Key takeaway

The company’s 2025 results met expectations, with strong growth inrevenue and profit, mainly due to a significant improvement indomestic orders and high overseas growth. 1Q26 results also metexpectations. Looking ahead to 2026, the company’s revenue isexpected to achieve solid growth, and net profit margin is likely tofurther improve. In the domestic market, the company’s market shareis expected to continue rising. High-end products such as the 5.0TMR, uMI Panorama, photon-counting CT, and dual-source widebodyCT are expected to contribute incremental performance. Inoverseas markets, the company’s brand influence continues tostrengthen. Since 2H25, the delivery and revenue recognition pace ofkey overseas projects has accelerated significantly. Overseas marketsare expected to maintain the high growth momentum seen in 2025 in2026. In addition, the company’s ultrasound products have beenlaunched in multiple key markets both domestically and overseas,and are expected to become a new growth driver in the future.

Event

The company released its 2025 annual report and 1Q26 reportIn 2025, the company recorded revenue of RMB13.8bn (+34% YoY),net profit attributable to shareholders of the parent company ofRMB1.869bn (+48% YoY), and net profit attributable to shareholdersof the parent company excluding non-recurring items of RMB1.77bn(+75% YoY). Basic earnings per share was RMB2.28/share. 2025 profitdistribution proposal: Cash dividend of RMB1.80 per 10 shares (taxincluded). No bonus shares will be issued and no capital reserve willbe converted into share capital in this distribution.

In 1Q26, the company recorded revenue of RMB2.908bn (+17% YoY),net profit attributable to shareholders of the parent company ofRMB0.399bn (+8% YoY), and net profit attributable to shareholders ofthe parent company excluding non-recurring items of RMB0.372bn (-2% YoY). Basic earnings per share was RMB0.48/share.

Brief analysis

2025 results met expectations, mainly driven by a significant improvement in domestic orders and strongoverseas growth

In 2025, the company recorded revenue of RMB13.8bn (+34% YoY), net profit attributable to shareholders of theparent company of RMB1.869bn (+48% YoY), and net profit attributable to shareholders of the parent companyexcluding non-recurring items of RMB1.77bn (+75% YoY). Revenue met expectations and achieved stronggrowth, mainly due to a significant improvement in domestic tendering activity and strong growth in overseasmarkets. Net profit growth outpaced revenue growth mainly because the net profit margin base in the previousyear was relatively low. As revenue scale increased significantly in 2025, expense ratios declined and net profitmargin improved.

In 1Q26, the company recorded revenue, net profit attributable to shareholders of the parent company, and netprofit attributable to shareholders of the parent company excluding non-recurring items of RMB2.908bn (+17%),RMB0.399bn (+8%), and RMB0.372bn (-2%), respectively. Performance was in line with expectations. Revenuegrew steadily, while net profit grew slower than revenue mainly due to a slight decline in gross margin, whichled to a drop in net margin.

Domestic high-end product lines gained significant share, while overseas markets delivered stronggrowth

By business segment, in 2025 revenue from medical imaging diagnostic equipment and radiotherapy equipmentreached RMB11.39bn (+35%). Service revenue was RMB1.708bn (+26%), accounting for 12.38% of total revenue.Among this, overseas service revenue increased by more than 50% YoY, mainly due to the continuous increase inthe company’s installed base, which drove rapid growth in service revenue. Software revenue was RMB0.055bn(-34%), mainly because software projects have long acceptance cycles and the projects were not completed andaccepted during the reporting period. By product, sales revenue of CT, MR, XR, MI, and RT products wasRMB3.545bn (+16%), RMB4.548bn (+42%), RMB0.798bn (+36%), RMB1.908bn (+47%), and RMB0.591bn (+86%),respectively. Sales volume of CT, MR, XR, MI, and RT was 1,501 units (+7%), 664 units (+14%), 1,170 units (+13%),175 units (+32%), and 51 units (+50%), respectively. Sales of MR, MI, and RT products maintained relatively fastgrowth, with high-end products contributing significantly. CT and XR businesses also achieved steadydevelopment during structural optimization, with mid-to-high-end products becoming the main growth drivers.

By region, in 2025 revenue from the China market was RMB10.369bn (+29.07%), mainly benefiting from therecovery in domestic medical equipment demand and the company’s increased market share. In 2025, thecompany’s newly added market share in the China market across its full product line (excluding ultrasound)increased by 4.5 pcts YoY, ranking first. By product, the company ranked first in domestic market share for CT,MR, RT, PET-CT, PET-MR, and mammography DR. Among these, MR market share increased by 2.7pct YoY, RTby 18.0pct, PET-CT and PET-MR by 13.5pct and 40.0pct respectively, and mammography DR by 10.2pct YoY.Overseas revenue was RMB3.431bn (+51.39%), accounting for 24.86% of total revenue (+2.86 pcts). By overseasregion, the European market increased by nearly 50% YoY, the North American market increased by more than56% YoY, the Asia-Pacific market increased by more than 40% YoY, and emerging markets increased by morethan 80% YoY.

Risks

1) Industry policy risk: Prosperity in the medical device industry is mainly related to the level of national policysupport and the availability of hospital procurement funds. Some national policies are unpredictable, and ourearnings forecast may fall short of expectations. For example, policies such as plans for newconstruction/expansion/renovation/upgrading of hospitals, medical equipment replacement programs,compliance inspections in the medical industry, and mutual recognition of test and examination results mayaffect procurement demand in the medical device industry. Funding sources for hospitals to procure medicalequipment mainly include national and local fiscal support and hospitals’ own funds. Whether hospitals havesufficient procurement funds is influenced by multiple policies, including medical insurance cost control policiesand medical service price reforms. Centralized procurement policies in the medical device industry may affectthe ex-factory prices and gross margins of related manufacturers’ products.

2) Overseas market risk: Overseas geopolitical conflicts may affect the growth rate of the company’s overseasperformance, and exchange rate fluctuations may also impact the company’s results.

3) Market competition risk: Companies such as GE Healthcare, Siemens Healthineers, and Philips Healthcarehave dominated many fields of the medical device industry for years. They hold significant advantages inacademic accumulation, clinical evidence, customer recognition, global supply chain integration, producttechnology development, overseas after-sales service, and brand influence. Facing international marketcompetition, if the company cannot maintain and continuously strengthen its competitive advantages and corecompetitiveness, the market share and prices of its products may decline as market competition intensifies.

4. Financial risks: Risk of changes in tax incentive policies; risk of accounts receivable collection.