Longsys forecasts profit surge to $1.5B driven by AI demand for memory chips

Projected Profits Surge

Shenzhen Longsys Electronics forecasts a net profit between $1.36 billion and $1.62 billion for the first half of 2026. This represents a staggering increase from the $2.2 million profit reported in the same period last year, translating to a growth rate close to 73,636%.

Revenue Expectations

The company's revenue forecast for the first half of 2026 is between $3.24 billion and $3.68 billion, substantially higher than the previous year's $1.5 billion. This increase is largely attributed to the ongoing demand for memory and storage chips fueled by the global shift towards artificial intelligence.

Supply Agreements and Production Stability

Longsys has secured long-term agreements with global memory wafer suppliers to ensure stable supply amidst increasing demand. The exact suppliers were not disclosed, but Longsys is shifting away from conventional suppliers like Micron and Samsung towards newer players like CXMT and YMTC.

Market Impact and Stock Performance

The anticipated growth has led to a 12.5% increase in Longsys stock over the weekend, with prices doubling from their lowest points in recent months. The company also received regulatory approval to raise $544 million through a private share placement, aimed at enhancing its R&D capabilities.

Shifting Landscape in Memory Chip Manufacturing

As the demand for memory chips escalates, established manufacturers face pressure from emerging players in China. The global memory chip shortage has affected PC manufacturers significantly, leading to a projected 14% decline in the PC market this year. Companies like Longsys are positioning themselves as crucial alternatives to traditional suppliers.