Shares of major Chinese optical communications suppliers slumped on Friday.
Eoptolink Technology dropped as much as 15 per cent during morning trading in Shenzhen. Suzhou TFC Communication slid 10.3 per cent during morning trading in Shenzhen. By the midday break, Eoptolink was down around 9 per cent, while TFC pared its decline to 4 per cent.
These losses followed a sharp decline on Thursday, when TFC plunged 19.8 per cent and Eoptolink tumbled 11.1 per cent. Innolight fell 8.5 per cent on Thursday. Innolight and Eoptolink manufacture optical transceivers, while TFC produces optical components used in communications equipment.
On Thursday, Innolight reported a 173.7 per cent increase in third-quarter net profit, reaching 8.59 billion yuan (US$1.29 billion). The company's revenue jumped 171.8 per cent to 27.77 billion yuan during the same period.
Eoptolink reported a quarterly net profit of 3.84 billion yuan, up 61.2 per cent year on year, on an 80.3 per cent rise in revenue to 10.94 billion yuan on Thursday. However, Eoptolink's profit fell 19.1 per cent and revenue shrank 13 per cent on a quarter-on-quarter basis.
The nine-month operating cash flow for Eoptolink contracted 68.4 per cent to 1.46 billion yuan, with an operating cash outflow of about 152 million yuan in the third quarter. Innolight stated its order book was full, with major overseas clients placing orders through 2027. Eoptolink said mass shipments of its 1.6T modules had entered a sustained shipment growth phase.
