On May 6, with regard to the recovery of Huawei's mobile phone production capacity, Guanghong technology said on the investor interaction platform that the company has been cooperating with Huawei in many aspects to provide China with manufacturing services for multi-dimensional products such as mobile phones, tablets, smart wear, network terminals, security and PCs. The recovery of Huawei's mobile phone production capacity will undoubtedly have a positive impact on the company. We also look forward to continuing in-depth cooperation with Huawei in various fields.
In terms of business orders related to new energy vehicles, Guanghong technology has entered the supply chain system of Valeo, a world-renowned auto parts supplier, since last year, and officially began mass production after the Spring Festival this year. Taking this opportunity, the company's automotive electronics business will grow significantly this year.
In addition, in view of the fact that the growth rate of revenue is higher than that of net profit, Guanghong technology explained that the main reason is the change of the proportion of the company's business model. Since last year, the company has gradually increased the proportion of purchasing materials for customers in response to the needs of some customers on some projects, in addition to the previously focused processing mode of incoming materials. Compared with the pure incoming processing mode, the material procurement mode will bring more revenue growth to the company, while the net profit margin is relatively low. However, material procurement can not only bring more profit growth space for the company in addition to processing fees, but also greatly deepen the cooperation with customers. It is the only way for EMS enterprises to further develop.
From the latest financial report, Guanghong technology's orders in the first quarter were in good condition, and its revenue and profit increased significantly year-on-year. "In the second quarter, the company's orders will further maintain stable growth."