Sanan Optoelectronics' actual controller Lin Xiucheng arrested; He Gang appointed Huawei director; Cambricon's first three quarters revenue doubled year-on-year

1. Sanan Optoelectronics: Actual controller Lin Xiucheng approved for arrest;

2. He Gang appointed Huawei director, continues to head Terminal BG;

3. Goke Microelectronics raises prices for the second time this year: memory shortage spreads to "rigid-demand small components";

4. Cambricon's revenue in the first three quarters of 2026 doubled year-on-year, net profit up over 130%;

5. Three tech giants reportedly pay hundreds of billions of New Taiwan dollars for substrate capacity, driving Unimicron, Kinsus and Nan Ya PCB to accelerate plant expansion;

6. Apple iPhone Duo in high demand; IDC optimistic it will dominate the foldable phone market

1. Sanan Optoelectronics: Actual controller Lin Xiucheng approved for arrest

Sanan Optoelectronics (600703.SH) announced that the company received notice from the family of actual controller Lin Xiucheng that Lin Xiucheng has been approved for arrest by the procuratorate on suspicion of the crimes of embezzlement and misappropriation of funds.

The announcement noted that the company's production and operations management are currently normal, that Lin Xiucheng has not held any position in the company since July 10, 2017, and that the matter is unrelated to the company and will not have a material impact on the company's production and operations.

On March 23 this year, Sanan Optoelectronics had announced that the listed company's actual controller Lin Xiucheng was placed under retention and subject to investigation by the supervisory authority; on September 24, Sanan Optoelectronics received notice from Lin Xiucheng's family that Lin Xiucheng had been criminally detained by the public security authorities on suspicion of the crimes of embezzlement and misappropriation of funds.

In the first half of 2026, Sanan Optoelectronics' revenue was 6.468 billion yuan, a comparable increase of 8.97% after excluding the adjustment to the precious metal scrap caliber; net profit attributable to the parent was -97.9 million yuan, turning from profit to loss, and non-recurring net loss was 504 million yuan. LED epitaxial chip revenue increased 11.81%, optical technology turned profitable in the second quarter, and silicon carbide is still ramping up; inventory was 6.635 billion yuan and short-term debt 9.087 billion yuan, with the controlling shareholder's bankruptcy reorganization hanging overhead.

On October 15, Sanan Optoelectronics (600703) issued an announcement that the company today received notice from controlling shareholder Sanan Electronics that creditors of Sanan Electronics, Hubei Changjiang Anxin Industrial Investment Fund Partnership (Limited Partnership) and Hunan Lugu Development Group Co., Ltd., applied to the Xiamen Intermediate People's Court for bankruptcy reorganization of Sanan Electronics.

At the same time, creditor of Sanan Group Hunan Lugu Development Group Co., Ltd. also applied to the Xiamen Intermediate People's Court for bankruptcy reorganization of Sanan Group. As of the disclosure date of the announcement, Sanan Electronics and Sanan Group had not received the ruling of the Xiamen Intermediate People's Court accepting the bankruptcy reorganization, and whether the applications will be formally accepted remains uncertain.

The announcement mentioned that Sanan Electronics holds 1.13 billion shares of the company, and the company's indirect controlling shareholder Sanan Group holds 182 million shares of the company; the two together hold 1.312 billion shares of the company, accounting for 26.30% of the company's total share capital.

2. He Gang appointed Huawei director, continues to head Terminal BG

On October 23, an update to the management information on Huawei's official website showed that He Gang has been appointed a director of Huawei and continues to serve as CEO of Terminal BG. A simultaneous change was the verification of his personal Weibo account, which has now been updated to "Huawei Director, Terminal BG CEO."

This means that Huawei's terminal business line now has two executives on the board of directors at the same time: Yu Chengdong and He Gang, further highlighting the weight of the terminal business at the level of Huawei Group governance.

Public résumé information shows that He Gang is a Huawei veteran with nearly 30 years of experience who joined the company in 1998, with a career path spanning the main wireless track and the terminal consumer business. In his early years he worked deeply in the wireless communications field, successively serving as president of the wireless GSM&UMTS product line and head of the global wireless solutions sales department; he later moved to the terminal segment, serving successively in key positions including president of the Terminal BG mobile phone product line and chief operating officer of Terminal BG, and has long-term operating experience with Huawei phones, the HarmonyOS ecosystem and all-scenario terminal business.

Since taking over as CEO of Terminal BG, He Gang has continued to lead the team in advancing Huawei terminal product iteration and HarmonyOS ecosystem expansion, with the all-scenario product matrix of phones, tablets, smart wearables and HarmonyOS smart home continuing to be rolled out. This entry into the board of directors will also allow him to participate in Huawei's overall strategic planning at the company's top decision-making level and coordinate the long-term development of the terminal business.

3. Goke Microelectronics raises prices for the second time this year: memory shortage spreads to "rigid-demand small components"

Goke Microelectronics announced that from November it will raise prices again for co-packaged KGD products, with 64MB to 256MB increased by US$0.5 to US$1.5 respectively, the second price adjustment this year. Direct competitor Geke Microelectronics simultaneously adjusted prices for KGD packaging by 40% to 80%, and security and memory chip makers such as Fullhan Microelectronics and Beijing Junzheng followed with price increases, with the memory shortage spreading rapidly along the security supply chain as the industry bids farewell to low-price involution.

Two adjustments in one year: from "percentage increase" to "absolute dollar value"

On October 22, Goke Microelectronics sent a price adjustment notice letter to customers and distributor partners, announcing that from November 2026 it would implement a new round of price increases for co-packaged KGD memory products. This is Goke Microelectronics' second price adjustment this year, after the large percentage-based adjustment at the start of the year, and the pricing method has also switched from "percentage increase" to "absolute dollar value."

According to the notice letter, this price adjustment covers small-capacity co-packaged KGD products: co-packaged 64MB KGD products are raised by US$0.5 (about RMB 3.34), co-packaged 128MB products by US$1.0 (about RMB 6.69), and co-packaged 256MB products by US$1.5 (about RMB 10.03); price adjustments for external DDR products will be notified separately. The reasons Goke Microelectronics gave in the letter are consistent with before: DDR memory chips remain persistently scarce across the entire industry, the supply gap for co-packaged KGD memory chips is expected to widen further, and costs have climbed sharply compared with before; at the same time, production raw materials such as substrates and frames are also under significant upward pressure. Goke Microelectronics reiterated that it will provide partners with stable technical support and competitive commercial support, and hopes to stand shoulder to shoulder and overcome the difficulties together, smoothly getting through this round of volatility in the memory industry.

Looking back at the first round of price adjustments in January this year, the magnitude was even more rare: starting from January 2026, the price of co-packaged 512Mb KGD products was raised by 40%, co-packaged 1Gb products by 60%, and co-packaged 2Gb products by up to 80%, with prices for external DDR products to be notified separately; the company said at the time that the price increases in the second quarter of 2026 would be adjusted accordingly based on fluctuations in the KGD market at that time. In the semiconductor supply chain, a one-time price increase of 80% for a single model is already an extreme situation—behind it there is usually only one logic: severe supply-demand imbalance, and the shortage has reached the point where prices must be used to suppress demand. According to a review by Jiwei.com, Goke Microelectronics also adjusted prices for its full series of products, including solid-state storage chips and SSD controller chips, by 20% to 80% starting from February 1, 2026, with enterprise-grade SSDs and high-end DDR-adapted products rising by as much as 80%—the two price adjustments covered the entire proprietary product line from co-packaged KGD to controller chips and SSDs.

From percentages to absolute dollar values, the switch in pricing method itself is a signal: after a round of broad increases at the start of the year, the absolute price base for small-capacity products has already risen, and increases are beginning to be locked in tier by tier in US dollars, with the pricing system entering a stage of "re-estimation order by order."

[Chart: Magnitude of Goke Microelectronics' first round of price adjustments for co-packaged KGD products]

Chart interpretation: In January 2026, Goke Microelectronics raised prices for co-packaged KGD products by capacity tier, with 2Gb products rising by as much as 80%—a one-time 80% increase for a single model is the most direct price footnote to supply-demand imbalance.

What co-packaged KGD is: a "rigid-demand small component" for industrial and automotive applications

To understand this round of price increases, one must first understand what co-packaged KGD is. KGD stands for "Known Good Die," referring to qualified dies that have been strictly tested and screened after wafer dicing and supplied directly to packaging and testing houses without final packaging. The co-packaged KGD solution uses multi-chip packaging (MCP) to co-package memory dies and controller chips in the same package, with core advantages of smaller size, lower power consumption, and higher reliability.

Such products are not consumer-grade flash memory, but "rigid-demand small components" in fields such as security surveillance, automotive electronics, industrial control, edge AI devices, and IoT terminals, with extremely high requirements for stability and integration. Their customer profile determines price elasticity: downstream customers dare not run out of materials—if a security device lacks one memory chip, the entire production line must stop; if a dashcam lacks one co-packaged die, the whole vehicle certification must be redone. Precisely because of this, when supply contracts, price transmission can be realized. The rise in co-packaged KGD prices reflects the deepening of structural shortages in underlying hardware, rather than price fluctuations of a single product.

Competitors and peers: a relay of price increases along the security memory chain

An important background to why Goke Microelectronics' price increases could be implemented is that its competitors and peers did almost the same thing at almost the same time. Around the track of "security SoC + memory controller + co-packaged KGD," a relay of price increases is unfolding.

Direct peer: GalaxyCore follows with KGD co-packaging price adjustments. After Goke Microelectronics sent its letter in January, GalaxyCore immediately followed, planning price adjustments of 40% to 80% for KGD packaging products—completely overlapping with Goke Microelectronics' increase range. The product logic of the two companies is highly similar: both are memory controller chip manufacturers, both serve downstream markets such as security and consumer electronics with KGD co-packaging solutions, and price following means the market price center for co-packaged KGD has been raised overall.

Direct competitor in security SoCs: Fullhan Microelectronics makes two rounds of comprehensive price adjustments. As a veteran manufacturer in the security chip field, Fullhan Microelectronics has dynamically adjusted prices quarterly since the second half of 2025, and launched a second round of comprehensive price adjustments in February 2026—the company publicly stated that all SoCs and edge AI chips would rise by varying degrees, fully passing memory costs downstream, while downstream customers prioritized securing supply and had a high acceptance of price increases. The motivation for its price adjustments came from a dramatic change in cost structure: Fullhan Microelectronics disclosed that in some IPC chips containing large-capacity KGD, the memory cost share has risen from the original 20% to 40% to 60% to 70% or even higher, and DDR2, due to upstream capacity exit, has risen several times compared with the first half of the previous year. The effect is directly reflected in the financial statements: in the first half of 2026, Fullhan Microelectronics' gross margin rose by nearly 10 percentage points in half a year, exceeding 45%.

A restrained version from a leading rival: SigmaStar's consultative price adjustments. SigmaStar, which ranks first globally in security vision SoC market share, has chosen a gradual route by leveraging the scale advantages of its "chip + built-in memory" integrated solution—gradually advancing dynamic price adjustments after friendly consultations with customers, without announcing a uniform increase, but adjusting by business line according to product competitiveness and market supply and demand, maintaining a balance between raising prices and preserving customer relationships.

Storage peers: some Beijing Junzheng products have more than doubled in price. Beijing Junzheng, which has both storage and computing chip businesses, began adjusting prices as early as the third quarter of 2025, prioritizing DRAM chips with relatively larger increases, with NOR Flash and computing chips following suit. The company also confirmed in an investor relations event that DRAM price adjustments for domestic customers continued from the first quarter into the second and third quarters, with overseas customers following gradually; the company disclosed that domestic market prices have risen significantly, with some products more than doubling, while overseas markets have been relatively moderate, and consumer-grade storage increases have been notably higher than industry-grade products. Even more telling is the change in its pricing mechanism: quote validity periods have been shortened from annual and quarterly to monthly, with prices updated in real time according to market conditions, and wafer capacity locked in through long-term agreements.

Supporting chips and small and mid-sized manufacturers are following suit. CMOS image sensor leader SmartSens sent a price increase letter to customers on February 26, uniformly raising prices by 20% starting March 1 for smart security and AIoT products produced at Samsung's wafer fabs and by 10% for products from Nexchip's wafer fabs; Yanji Microelectronics raised prices on Shenmou channel offline products by 1% to 20%, and Ankai Micro has implemented price adjustments on some products starting January 2026. The downstream module segment is also under pressure: Zhongwei Century raised prices on channel security products by 5% to 20% starting December 18, 2025, and Jiegao Electronics announced the "simultaneous activation of an allocation model" alongside its price adjustments—a rationing practice last seen during the chip shortage during the pandemic is making a comeback.

Notably, the magnitude of price increases varies significantly. Storage-related products and high-computing-power edge AI chips are the main drivers of price adjustments, while manufacturers with a low storage cost share have been much more moderate: Amlogic has only gradually raised prices on its main SoC products, Telink and Bestechnic have not yet announced clear adjustment magnitudes due to their small storage cost shares, Espressif, whose storage accounts for only about 10% of revenue, has chosen not to raise prices for now, and Allwinner has not clarified any price adjustment plans. Fullhan Microelectronics' differentiated strategy also corroborates this logic: automotive products saw relatively moderate price adjustments because they do not have KGD built in. Storage cost share is becoming the dividing line that determines manufacturer flexibility in this price increase cycle.

[Chart: Comparison of price increase magnitudes among major manufacturers in the security storage chain]

Chart interpretation: Goke Microelectronics and GalaxyCore, both in the KGD co-packaging camp, saw completely synchronized increases (up to 80%), some of Beijing Junzheng's storage products rose by more than 100% domestically, while supporting and module segments such as SmartSens, Yanji Microelectronics, and Zhongwei Century saw increases concentrated in the 10% to 20% range—price increases decline step by step along "storage content."

Why has this track that Goke Microelectronics occupies collectively turned? The source still lies on the storage supply side. Under the AI demand explosion, storage giants such as Samsung, SK Hynix, and Micron have concentrated wafer, packaging, and testing resources on high-value-added products such as HBM and high-capacity DDR, continuously squeezing the supply of niche storage and co-packaged KGD; the supply tightening amplifies along the chain—after negotiations among Samsung Electronics, SK Hynix, and Apple, the quoted prices for LPDDR memory used in iPhones rose by more than 80% and nearly 100% respectively, and Counterpoint expects DRAM prices to rise another 40% to 50% after last year's 50% increase. On the demand side, downstream sectors such as security, automotive, and industrial have entered a restocking cycle after destocking, and co-packaged KGD, as a key supporting component for storage controllers, has extremely rigid demand, with downstream customers afraid of running out of materials, allowing price transmission to be realized.

Beyond the main thread of supply contraction and rigid demand transmission, two other forces are adding fuel to the fire.

The first is the contraction of mature capacity. Leading wafer fabs are gradually consolidating and shrinking 8-inch capacity, directing more capital expenditure toward 12-inch advanced processes, and the global expansion of mature processes has slowed markedly; even expanding production through second-hand equipment faces longer delivery cycles and rising costs. The foundry and packaging/testing resources that design companies such as Goke Microelectronics and GalaxyCore rely on have become increasingly tight against this backdrop.

The second, and more alarming, is the timing of this change: this round of price increases is not occurring during an economic recovery but is unfolding in tandem with weakening consumer demand—IDC and Counterpoint forecast that smartphone sales will decline 2% this year, the first annual decline since 2023; the PC market will contract 4.9%, and game console sales will fall 4.4%. Weak demand only delays rather than prevents price increases: some consumer-grade SoCs and low-end IoT chips have not yet fully reflected rising costs, not because they are immune to inflation, but because IC design companies, under pressure from fierce terminal price competition, are holding orders by compressing profits, delaying the transmission of price increases downstream. Some analysts call this a typical "gray rhino" risk on the eve of 2026: visible to all, yet underestimated.

For Goke Microelectronics itself, raising prices is also an inevitable choice at the operational level. The company previously expected a net loss attributable to shareholders of about 180 million to 250 million yuan for the full year of 2025, turning from profit to loss year-on-year—mainly due to declining sales of some products, rising raw material costs without product price increases, and increased R&D investment in multiple fields. Against the backdrop of performance pressure in 2025, it is imperative to hedge cost pressure through product structure optimization and price increases.

Industry direction: the beneficiaries, the pressured, and the cycle inflection point of price increases

The industrial impact of the price increase wave is emerging in layers.

On the benefiting side are manufacturers with the ability to pass on costs. Brokerage research reports note that Goke Microelectronics' gross margin is expected to continue improving, with an earnings inflection point imminent; Fullhan Microelectronics' SoC chips, because the cost share of memory particles has surged, have opted for quarterly dynamic pricing, and downstream customers place greater value on supply stability and are relatively accepting of price increases—the pass-through of price increases combined with product upgrades has together produced its high profit growth. For Goke Microelectronics, in addition to co-packaged KGD, the company has already formed a dual business engine in the solid-state storage field of "solid-state drive controller chips + industry solid-state drive products," and by taking a stake in Xinsheng Intelligent it has extended its storage industry ecosystem, and is expected to benefit from the storage price increase wave.

On the pressured side are the links that are difficult to pass on. The sharp fluctuations in KGD prices are sending a direct warning to OSAT manufacturers, module makers, and system manufacturers—it is already difficult within the supply chain to "quietly absorb" cost increases; manufacturers such as Apple and Dell face the choice of whether to pass on cost increases to consumers, and the impact on low-end and mid-range device manufacturers may be greater.

At the industrial logic level, this round of price increases is changing the competitive landscape. The security industry, long mired in low-price involution, is using this round of cost reshaping to bid farewell to price wars—industry analysis generally believes that the price increase cycle has broken the deadlock under product homogenization, and manufacturers with integrated "chip + storage" capabilities and rigid customer structures have instead gained the opportunity to restore profitability and share; and in the storage main line, the niche market space freed up by the original manufacturers' shift to HBM is shifting to manufacturers with production capacity—the domestic substitution window for the domestic storage industry chain is opening in sync with the price increase cycle.

Of course, a cycle always has another side. Every historical price increase wave has ended with capacity expansion and falling demand: when original manufacturers' HBM capacity is gradually released and consumer electronics demand continues to weaken, the price elasticity of niche storage may also reverse. Goke Microelectronics' statement in its price increase letter about "overcoming difficulties together and smoothly passing through this round of storage industry fluctuation cycle" has already made clear the industry consensus—this is a cycle, not a new normal. For every company in the industry chain, the real question is not how much this round of price increases can rise, but when the cycle reverses, whether what is in hand is a rigid customer structure or only price.

4. Cambricon's revenue in the first three quarters of 2026 doubled year-on-year, net profit growth exceeded 130%

On the evening of October 23, Zhongke Cambricon Technology Co., Ltd. (stock code: 688256.SH) released its 2026 third-quarter report. The financial report shows that the company's third-quarter and first-three-quarter revenue and profitability indicators all achieved rapid growth, with operating quality improving simultaneously.

In the third quarter of 2026, the company achieved operating revenue of 3.531 billion yuan, a year-on-year increase of 104.47%; net profit attributable to parent company shareholders of 1.404 billion yuan, a year-on-year increase of 147.74%; net profit after deducting non-recurring gains and losses of 1.358 billion yuan, a year-on-year increase of 168.13%.

Cumulatively for the first three quarters, the company achieved operating revenue of 9.526 billion yuan, a year-on-year increase of 106.76%; net profit attributable to parent company shareholders of 3.715 billion yuan, a year-on-year increase of 131.49%; net profit after deducting non-recurring gains and losses of 3.523 billion yuan, a year-on-year increase of 148.30%. In terms of R&D investment, in the first three quarters the company's total R&D investment was 1.225 billion yuan, a year-on-year increase of 45.35%.

Regarding the reasons for the substantial performance growth, the company stated in its financial report that it was mainly due to continuous market expansion and active support for the implementation of artificial intelligence applications, which drove operating revenue to grow substantially year-on-year, thereby driving simultaneous increases in total profit, net profit, and net profit after deducting non-recurring gains and losses and other profitability indicators.

5. Three tech giants reportedly pay over NT$100 billion for substrate capacity, driving Unimicron, Kinsus, and Nan Ya PCB to accelerate plant expansion

In order to ensure capacity in the artificial intelligence (AI) supply chain, industry sources say the three major tech giants Intel, Nvidia, and AMD have paid deposits totaling more than NT$100 billion to reserve long-term capacity at high-end substrate plants, while the top three IC substrate makers Unimicron, Kinsus, and Nan Ya PCB are actively expanding production to alleviate supply chain bottlenecks. This year, major substrate companies have announced investment in plant construction at a record high, cumulatively reaching a new record of NT$161.2 billion.

The companies named by the market all declined to comment on individual customer information, but Unimicron, Kinsus, and Nan Ya PCB have recently accelerated plant expansion. Unimicron's capital expenditure this year ranks first among substrate companies; its board of directors previously resolved to approve an additional NT$19.7 billion in capital expenditure for this year, bringing total capital expenditure for this year to NT$53.7 billion, with large-scale purchases of long-lead-time equipment, and the amount of purchase orders was further increased by NT$17.6 billion.

At the end of September, Unimicron announced the purchase of Bridgestone's Hukou plant in Taiwan, China, for about NT$10.08 billion, mainly to respond to customers' future high-end substrate capacity expansion needs by laying out land and plant resources. Unimicron's announcement stated that the land purchase is for medium- and long-term operational development strategy, for overall production allocation and capacity planning.

Kinsus has in recent years transformed to cultivate high-end substrates, phasing out traditional PCB production, and has expanded high-end substrate capacity in recent years. The board of directors approved capital expenditure of NT$23.5 billion to meet equipment demand for expanding ABF substrate capacity over the next three years, with NT$8 billion to be spent in 2026, of which NT$6 billion will be used for ABF substrate investment, and a further special project capital expenditure budget of NT$19.6 billion has been added.

Nan Ya PCB's board of directors previously resolved to approve additional capital expenditure to build a smart factory for large-size, high-layer-count high-end substrates, with an estimated investment amount of NT$46.8 billion.

Intel CEO Chen Li-wu previously publicly mentioned that AI is driving demand for advanced packaging and chips, and upstream IC substrates and materials are tight. To ensure materials and subsequent chip supply, several customers have proactively paid Intel in advance to help lock in substrates and capacity. Legal entities estimate that Intel's long-term prepurchased substrate capacity is about US$3 billion.

AMD previously announced an investment of US$10 billion in Taiwan, which the industry interprets as investing in the supply chain to secure capacity, with an estimated investment of about US$1 billion in substrates. Nvidia previously announced a large-scale capacity expansion plan with several core global supply chain partners, and outsiders also speculate that its investment in Taiwanese substrate makers is around US$1 billion, and may even be increased further. The cumulative investment of the three major players in the substrate industry amounts to as much as US$5 billion. (Source: Economic Daily News)

6. Apple iPhone Duo in high demand; IDC optimistic it will dominate the foldable phone market

Apple's first foldable phone, the iPhone Duo, went on sale on October 23. Even with a base price of more than US$2,000, it still attracted users to line up at physical stores, and online pre-orders are already scheduled through the end of January next year. Although this phone faces challenges such as tight supply and app support, research firm IDC still expects Apple to overtake Samsung Electronics and Huawei next year to become the leader in foldable phones.

Taiwan's three major telecom operators had already made preparations for the launch, and most iPhone Duo units had been allocated. However, telecom stores across Taiwan were closed yesterday due to a typhoon holiday, so Apple fans could see the phone but not get it, resulting in a launch-day "zero sales" record. Telecom operators said that users who have completed reservations only need to go to their original store to complete the follow-up procedures after stores resume normal operations, and they expect Apple fans signing up for high-rate plans of NT$1,399 or more to account for the largest share.

American-style warehouse store Costco began selling the iPhone Duo in Taiwan yesterday, and it sold out in just 5 minutes, becoming a focus of market discussion. Costco's price, combined with Black Diamond Card discounts, can save up to NT$5,445. Members on site witnessed that some consumers lined up the night before, and the iPhone Duo sold out in just 5 minutes after going on sale, with the typhoon failing to dampen the buying frenzy.

IDC Vice President Geronimo believes that foldable phones have been on the market for years, yet their penetration is far below that of ordinary smartphones, and Apple's entry is expected to attract more consumers. IDC estimates that Apple's sales share of the foldable phone market this year will reach 44%, with a shipment share of 31%, and next year it is expected to rank first in both sales value and shipments. (Source: Economic Daily News)