Huaxin Securities: Medium International Xuchuang's gross profit margin has increased quarter by quarter, and the rating has been raised to "buy".

Huaxin Securities research report pointed out that as a leading supplier of optical modules, Zhongji Xuchuang's net profit attributable to mothers and non-recurring net profit in the first half of the year showed rapid growth compared to the same period last year and quarter-on-quarter. The gross profit margin continued to increase each quarter, with a significant increase in Q2 compared to Q1, mainly due to the increase in the proportion of high-speed optical modules such as 800G, improved yield rates, design improvements, and other factors. With the AI infrastructure construction, strong capital expenditures from CSP customers, and the demand for 400G and 800G optical modules driven by ASIC chips and Ethernet data centers, the overall industry remains highly prosperous, and the company is expected to continue to benefit from industry demand growth. The company has technological strength and economies of scale in the field of optical modules, and the gradual increase in volume of 800G and 1.6T high-speed products is expected to further drive the company's performance. The investment rating has been raised to "buy."