Driven by the global energy transition and computing power revolution, silicon carbide (SiC) has become an ideal choice for power devices in fields such as new energy vehicles, photovoltaic energy storage, and AI data centers due to its excellent physical properties such as high breakdown electric fields, high thermal conductivity, and high electron saturation drift speed.
In the first half of 2026, the construction of AI computing power, mass production of 800V high-voltage platform models, and the expansion of optical storage equipment jointly boosted demand for SiC power devices, but industry competition intensified simultaneously, price wars continued to spread, and gross margins of many peers were still in a negative range. In this macro context, Basic Semiconductor (09971), a leading company in the field of silicon carbide power devices in China, handed over its first report card since listing. In a cycle where the industry generally faces gross profit challenges, basic semiconductors not only achieved steady revenue growth, but also achieved a historic leap from negative to positive gross margin, establishing their benchmark position on the silicon carbide circuit.
Revenue grew steadily, and gross margin reached a critical inflection point
The Zhitong Finance App notes that during the reporting period, the company's revenue increased 15.5% year on year; overall gross margin improved sharply from -28.8% to 2.8%, an increase of 31.6 percentage points, and achieved a milestone of positive gross margin in the field of silicon carbide power devices.
In a context where the industry is generally still mired in a quagmire of negative gross margins, the weight of this figure is self-evident. Loss for the period narrowed by 8.8% year on year; adjusted net loss narrowed by 15.1% year over year. This is not only a digital improvement, but also a substantial inflection point in the quality of the company's operations — verifying the path of profit improvement in the fierce price war in the silicon carbide industry, and has industry benchmark significance.
Why was gross margin corrected? The password is hidden in the dual optimization of the product structure and customer structure.
An in-depth analysis of changes in revenue structure reveals that basic semiconductors are actively optimizing product portfolios to cope with cyclical fluctuations in different market segments. During the reporting period, silicon carbide discrete devices became a new growth engine, and the share of revenue in total revenue during the period increased from 9.6% in the same period last year to 21.6%. Among them, SiC MOSFET revenue increased by more than 580% year-on-year, mainly due to the accelerated adoption of such products in renewable energy, industrial applications, AI data centers, and consumer electronics.
Overall revenue from SiC power modules accounts for 25.4% of total revenue. Although revenue from automotive-grade modules declined due to lower sales prices and strategic reductions in sales of low-margin products, active resource reallocation led to a revenue structure with higher profit quality — industrial-grade modules ushered in explosive growth, and revenue surged 2825.1% year-on-year during the period. Compared to automotive-grade products, industrial-grade modules require fewer chips and packaging materials, and gross margin performance is naturally better at the same sales scale. Its rapid release directly drives overall gross margin improvement.
At the same time, the customer structure is also undergoing positive changes. The company actively selects high-quality customers. The customer base has expanded from a small number of leading customers to a wider customer base, and the revenue sources are more diverse and stable. On the upstream supply chain side, procurement costs for epitaxial wafers and major materials have generally been reduced through measures such as centralized negotiation, introduction of second suppliers, and domestic substitution. Procurement costs for some production consumables have been reduced by up to 30%. Cost control provides strong support for improving gross profit. The triple collaboration of tilting the product structure towards high gross profit, diversification of the customer structure, and continuous optimization of supply chain costs has jointly promoted gross margin to cross the break-even line, verifying the effectiveness and forward-looking nature of the company's “qualitative growth” strategy.
New scenarios open up growth poles, and the application layout is further expanded
If the change in gross margin is a “financial answer” handed over by basic semiconductors, then its card position on the application scenario side outlines a longer-term growth story.
AI data centers are a new scenario that is exploding. AI computing power requirements are driving the upgrading of data center power supply architectures to HVDC, and silicon carbide has changed from “optional” to “required.” During the reporting period, basic semiconductor products were adopted in AI data centers of leading domestic telecom operators to provide support for localized replacement of intelligent computing clusters and green and low-carbon operation. The cumulative number of orders for industrial-grade silicon carbide power modules in the field of electroplating power supplies has exceeded 30,000, and demand for renewable energy scenarios such as photovoltaics and energy storage continues to increase.
The robot circuit is the latest strategic development. At the 2026 World Robotics Conference, Basic Semiconductor officially signed a strategic cooperation agreement with the “First Stock in Humanoid Robots” Yubi Choice. The two sides will develop in-depth cooperation on the application of silicon carbide power devices in the field of intelligent humanoid robots to develop low power consumption and high battery life solutions for scenarios such as power management and motion control. What is more noteworthy is that basic semiconductors will deploy preferred humanoid robots on their own silicon carbide production lines to jointly build demonstration production lines for semiconductor manufacturing applications. The “third-generation semiconductor+embodied intelligence” integration paradigm not only opens up new market space, but is also expected to feed back improvements in manufacturing efficiency.
Simultaneous breakthroughs in overseas markets. Automotive-grade silicon carbide power modules have obtained new targets for overseas vehicle projects from European first-tier suppliers; solid-state circuit breaker projects of leading international electrical companies using industrial-grade silicon carbide power modules have entered the testing and introduction stage. Silicon carbide discrete devices also enable batch overseas delivery of photovoltaic inverters.
Implementation did not stop after listing, and an in-depth strategy began to take shape
The Zhitong Finance App noticed that less than two months after launch, the strategic implementation of basic semiconductors was in a tight and orderly manner.
In terms of technology upgrades, less than a month after launch, it was announced that a strategic cooperation had been reached with Hanlei Technology to accelerate the development and mass production of 8-inch silicon carbide wafers. Currently, the industry is in a critical window of iteration from 6 inches to 8 inches — the 8-inch substrate area is 78% larger than the 6-inch, the number of chips that can be cut in a single chip has increased 1.8-2 times, and the cost of a single chip can be reduced by 35%. Companies that pioneered the layout on the 8-inch track are expected to take the initiative in the next round of cost competition.
At the capital operation level, on the day the results were announced (August 28), the company simultaneously held an extraordinary shareholders' meeting to deliberate and pass five special resolutions, including general authorization to repurchase shares, H share incentive plan, and general authorization to issue H shares, all of which were passed by full vote. According to the previous announcement, the company plans to repurchase no more than 10% of the total number of H shares issued during the authorization period. The repurchase capital comes from internal resources, with the aim of protecting corporate value and shareholders' rights. At the same time, the H share incentive plan is limited to 10% of the total number of issued shares. The purpose is to provide eligible participants with an opportunity to obtain the company's share capital benefits and motivate the core team to work to enhance the company's long-term value. Buybacks send value signals to the market, and incentives bind long-term benefits to the team — the two go hand in hand, which not only expresses management's confidence in the company's prospects, but also reserves organizational momentum for it to move from improving profit quality to “continuous growth.”
Summary
The valuation logic of the silicon carbide industry is undergoing a profound reshaping — the market is no longer paying a premium for a simple production expansion story, and future valuation differentiation will be more intense than before. In this round of systematic switching, basic semiconductors have completed accurate “strategic calibration”: competing for next-generation costs with 8-inch technology upgrade cards, building a profit base with industrial-grade market volume, and opening up long-term space with batch delivery in the vehicle regulation market. The correction in gross margin is the first milestone in this strategic path.
What is particularly noteworthy is that this mid-term questionnaire was handed over on the condition that the company had not yet used the IPO to raise capital — the team had achieved a critical inflection point of gross margin correction through execution at a stage where capital was relatively limited, which in itself was a strong test of the company's strategic strength and operational capability. Once the capital raised by the IPO is in place, production capacity expansion, technology iteration, and global market expansion will be supported by more resources. When the industry gradually fades away from the narrative, what will eventually stay on the valuation table will be companies with real hematopoietic capabilities and in-depth strategies. What basic semiconductors have proven is not only a viable path to profit-driven quality-driven growth — and this path has only just begun.