Original title: Hisense has built a core sword in two years, pointing to 100 billion revenue
On the high-end chip track, Hisense is undoubtedly one of the companies with high expectations.
“Chip is the core underlying technology of Hisense’s large display strategy.”
On January 11, Yu Zhitao, vice president of Hisense Group and president of Hisense Video (600060.SH), said at the launch of China’s first self-developed 8K AI image quality chip.
Yu Zhitao emphasized that for decades, Chinese, Japanese and Korean companies have fought fiercely over display technology and the industrial chain, and Hisense has always been at the forefront of this war, especially in the core track of chip technology.
He believes that as the global TV competition enters an inflection point, the core image quality technology represented by 8K image quality chips will become a new round of “winning weapons”.
Create a “core” big move
The successful development of China’s first 8K AI image quality chip this time further reflects Hisense’s ambitions for the layout of the large display industry.
The chip is known as the country’s “industrial grain” and is the heart of the whole machine. Chip technology is the technical level symbol of the whole machine, which reflects the core intellectual property rights and main added value of the product.
Hisense has accumulated more than 20 years in chip research and development.
In June 2005, Hisense developed China’s first digital video processing chip with independent intellectual property rights and industrialization.
Since 2015, Hisense has released 5 image quality chips, constantly refreshing China’s display image quality ceiling.
The 21st Century Business Herald reporter learned at the Hisense press conference that the development of the fifth-generation 8K AI image quality chip took two years. In terms of application, Hisense’s fifth-generation 8K AI image quality chip has been used in the whole machine, and will be released in 2022. Comprehensive coverage of Hisense TV, Toshiba TV, broadcast-grade benchmark monitors, medical professional display and other large display industries.
From the perspective of enterprise development, Hisense continues to increase investment in chip research and development to occupy a competitive high ground. On January 11, Yu Zhitao emphasized in his keynote speech that “chips are the core underlying technology of Hisense’s large display strategy.”
Yu Heng, head of Hisense Chip Display, also said in an interview with a 21st Century Business Herald reporter, “High-end products can not only bring a better experience to users, but at the same time, various technologies collected during the research and development process can quickly sink to popularization. In the type of products, it drives the improvement of the entire product line experience.”
From the perspective of industrial upgrading, the breakthrough in domestic chip research and development is of great significance.
In response to the current situation of the industry, Xu Wenli, deputy director of the Electronic Information Department of the Ministry of Industry and Information Technology, said, “my country has achieved the world’s largest scale in the field of consumer electronics, and its color TV shipments have ranked first in the global market for many years. The bottleneck for the high-quality development of the industry is still chips.”
In Xu Wenli’s view, the current industrial supporting chips still need to be imported in large quantities, which affects the industrial upgrading and the popularization of high-end products to some extent.
On the high-end chip track, Hisense is undoubtedly one of the companies with high expectations.
According to Yu Zhitao, under the “assistance” of the chip upgrade, the attributes of the current Hisense display products have undergone tremendous changes, from the original single display attribute to the current five categories of picture quality, sound quality, content, interaction and AIoT. core positioning elements.
In these five core elements, how to provide users with a better product experience? How to make products always have good differentiated competitiveness?
“For a single product, the core is the chip. The specifications of the chip and the performance of the chip will affect the competitiveness of the terminal product in the market, and determine the profit and operating efficiency of the enterprise.” Yu Zhitao responded.
According to Yu Zhitao, it is the collaborative operation of chip research and development and the whole machine industry that has enabled Hisense to achieve its current achievements.
He pointed out that Hisense has the advantages of a natural vertical industry chain; it has the needs of TV sets, commercial displays, medical displays, etc., which provides an industrial foundation for the research and development of Hisense chips. The accumulation of image quality capabilities for more than 50 years has also provided a guarantee for the design and industrialization of image quality chips.
Technological upgrades create differentiated advantages
Yu Zhitao pointed out that for the TV industry, only when manufacturing develops towards high quality, the industry leaps forward to the mid-to-high end, and the price war moves to the value war, will it gain vitality and future.
It is reported that Hisense Group owns three listed companies, Hisense Home Appliances (000921.SZ), Hisense Video, and Sanden Holdings (6444.JP), which are operated by Hisense, Toshiba, gorenje, Kelon, Rongsheng, Vidda and other brands. Among them, Hisense Video focuses on TV-related businesses.
Relying on its unique advantages in the field of chips, Hisense Video has successively created products with high market competitiveness and technical content, such as stack-screen TVs, U7 TVs and broadcast-grade benchmark monitors, forming a complete and vertical system from chips to complete machines. industrial chain.
Always adhering to the large display strategy, Hisense Video has continuously expanded new tracks to meet the increasingly diversified consumption needs of scenarios, rediscovered the value of screens and connections, and found new growth space.
According to the research report of CICC on January 9, CICC maintained that Hisense Video outperformed the industry with a target price of 17.5 yuan, and predicted that Hisense Video’s net profit attributable to its parent in 2021 would be 1.41 billion yuan, a year-on-year increase of 17.95%.
It is worth noting that the stock price of Hisense Video has been fluctuating upwards since September 2021. As of the close on January 12, Hisense Video’s stock price closed at 14.93%, with a total market value of 19.536 billion yuan.
Yu Zhitao said, “Starting from 2020, Hisense Video has re-formulated its development strategy and will become a world-class system display provider in the next 5 to 10 years.”
On the one hand, Hisense Video will develop from the original single picture presentation to “display everywhere”; on the other hand, the competition that Hisense will face in the future will be the deepening of research and development, productization and ecologicalization of the industry.
Judging from the “transcript” handed over by Hisense, it has formed a complete series of chip products. Previously, it launched 4 generations of image quality chips and achieved mass production, forming a unique advantage on the image quality track and getting rid of homogeneity. compete.
It is understood that Hisense Video has now completed the adjustment of its industrial structure and formed a “1+4” diversified business layout.
Financial data shows that in the first three quarters of 2021, Hisense Video achieved operating income of 33.921 billion yuan, a year-on-year increase of 23.44%; net profit of 626 million yuan, a year-on-year increase of 8.79%; deducted non-net profit of 370 million yuan, a year-on-year increase of 319.9%.
From the perspective of product structure, Hisense Video’s business mainly includes two major sectors: smart display terminals and new display and new businesses. At present, Hisense’s video TV business has a solid market leadership, and the new display and new business segments are also in a period of rapid growth.
According to data from Aowei Cloud, in the third quarter of 2021, Hisense Video ranked first in both offline and online listings (sales caliber). In terms of domestic and foreign sales, the increase in the average price of products has promoted the growth of domestic sales, and the marketing investment of the European Cup has also driven the export sales to improve.
In addition to color TVs, the development trend of new display and new business segments of Hisense Video is also improving. Among them, laser TVs benefit from the cost advantage brought by large-screen display, and product penetration rate and market share continue to increase.
In addition, in the context of consumption upgrades in recent years, people’s demand for immersive large-screen viewing and entertainment experience is increasing. Hisense Video has also followed the trend and continuously increased investment in research and development.
The 21st Century Business Herald reporter checked the financial report and found that in the first three quarters of 2021, Hisense Video’s R&D investment was as high as 1.345 billion yuan, compared with 1.183 billion yuan in the same period in 2020.
With the recent successful development of 8K AI image quality chips, Hisense has not only formed a comprehensive strength covering display chips, smart chips and optical chips, but also has the ability to further develop smart TV SoC chips.
Regarding future development plans, Yu Zhitao once said that the revenue of Hisense’s large display industry will increase to 100 billion in 2025. He also predicted that “2022 will be the year of inflection point for global TV competition: out of the decades-long battle for cost performance, and into the battle for picture quality and quality.”
(Author: Lei Chen Editor: Zhu Yimin)
.
