Key takeaway

The company is a global leader in TV and IFPD OEM manufacturing. In 2025, demand in the IFPD and TV OEM industries declined. The company’s smart TV revenue scale and share decreased, but smart interactive display and innovative display businesses grew against the trend. In 2026Q1 all three major core businesses achieved growth in both volume and value. Meanwhile, benefiting from declining panel prices, the company’s gross margin recorded YoY improvement for two consecutive quarters. As the impact of asset impairment provisions weakens, together with a recovery in industry demand and continued rapid growth of innovative display products and proprietary brands, revenue and profit are expected to return to an upward trend in 2026.

Event

On April 19, 2026, KTC released its 2025 annual report; on April 29, 2026, KTC released its 2026 1Q report.

The company reported revenue of RMB14.473bn in 2025 (-7.14% YoY), with net profit attributable to shareholders of the parent company of RMB505mn (-39.35% YoY), and a net margin of 3.49% (-1.85pct); among which, in Q4 revenue reached RMB3.693bn (-11.98% YoY), net profit attributable to shareholders of the parent company was RMB3mn (-99.04% YoY), and net margin was 0.07% (-6.49pct). In 1Q26, revenue reached RMB3.492bn (+11.14% YoY), net profit attributable to shareholders of the parent company was RMB155mn (-27.64% YoY), and net margin was 4.45% (-2.38pct).

Risks

1) Decline in market demand: The global TV market has entered a stage of stock-based competition. Developed countries and regions like Europe, the US, and Japan are showing signs of demand exhaustion. High inflation is also eroding consumers' real purchasing power, leading to sustained sluggish demand for TV shipments. According to RUNTO data, global TV shipments are expected to reach 221mn units in 2025 (-0.7%). According to RUNTO Technology data, China’s TV shipments were 32.895mn units in 2025 (-8.5%). Looking ahead, the TV market environment is unlikely to see fundamental changes.

2) Panel price rebound: The persistent decline in inventory levels at leading panel manufacturers, coupled with expanded production cuts, reinforced the balance between market supply and demand. According to data from AVC Revo, prices for TV panels of various sizes have stopped falling since October 2022 and have subsequently experienced modest increases. Compared to October 2022, the average prices for 75/65/55/50/43/32 -inch TV panels increased by USD72/73/52/40/17/10 respectively as of June 2024.

3) RMB exchange rate fluctuations: Long-term exchange rate fluctuations can impact the business strategies of foreign trade enterprises. The USD exchange rate has been subject to significant short-term fluctuations. According to data from the China Foreign Exchange Trade System, the current spot exchange rate of USD to RMB is around 6.9.