GUOSEN SECURITIES: Google AI hardware suite released, accelerating the AI transformation of terminal operating systems

According to the latest report from GUOSEN SECURITIES, Google (GOOGL.US) has released an AI hardware suite, integrating Gemini into various hardware such as smartphones, smartwatches, and TWS earphones. Gemini supports cross-application scheduling and deep integration with all Google applications. Additionally, during the interim performance period, the electronics industry has shown a significant acceleration in prosperity, completing a sufficient destocking and supply-side clearance in the past two years of the downturn cycle. Now, driven by the marginal demand for AI computing power and the innovation expectations of a new round of terminal AI, the industry is entering a strong upward cycle with sustainability.

With the industry's prosperity on the rise, it is recommended to focus on individual stocks with strong fundamentals during the performance period. In the past week, the Shanghai Composite Index rose by 0.60%, electronics by 0.66%, while other electronics sub-industries increased by 5.40% and electronic chemicals decreased by 1.26%. During the interim performance period, the electronics industry continues to show a clear acceleration in prosperity, as indicated by the operating rates and gross profit margins of SMIC and Huahong from last week. It is recommended to focus on individual stocks that achieve strong growth in performance through their own product categories and application field expansions during the performance period, as well as industry chain targets benefiting from new product releases such as Huawei's foldable phones and Apple's AI terminals. Key recommendations include: Sunlord Electronics, Luxshare Precision, Dongmu Shares, Transsion Holdings, Lens Technology, Changdian Technology, Crystal Optoelectronics, Hengxuan Technology, Weir Shares, Lanqi Technology, New Energy, and Kang Crown Technology.

Google's AI hardware suite release marks a comprehensive AI transformation for Android. On August 14th, at the 9th Made by Google event, Google unveiled an AI hardware suite, integrating Gemini into various hardware such as smartphones, smartwatches, and TWS earphones. Gemini supports cross-application scheduling and deep integration with all Google applications. Google's upgrade strategy for AI on the device side is similar to Apple's, focusing on rebuilding the operating system around AI. Google is currently restructuring the Android system, directly integrating Gemini into the construction of the Android system, thereby accelerating the upgrade of terminal hardware and consumer replacement. According to Statcounter data, Android holds a 43.82% market share in the US smartphone market in the past year. Following Apple's WWDC, Google's AI upgrade will significantly boost the AI innovation competitiveness of Android smartphones. It is recommended to focus on related industry chain targets: Goertek, Sunlord Electronics, Elec-Tech International, and Furong Technology.

Apple continues to invest in the AR industry, with multiple new products in experimental development. On August 13th, tech journalist Mark Gurman revealed in "Power On" that Apple's Vision team focusing on AR technology is continuously experimenting and developing multiple products, including AR glasses and a "budget-friendly Vision Pro" planned for next year Entering the earnings disclosure period, it is recommended to pay attention to the trend of improvement in the performance of power device companies. In the second quarter, medium and low-voltage power devices gradually stabilized, entering a phase of improvement in performance compared to the previous quarter: benefiting from the repair of demand for existing MOSFETs, the exploration of incremental markets such as automotive and servers, the revenue of new clean energy non-IGBT businesses all achieved year-on-year growth, and gross profit margin improved quarter-on-quarter for four consecutive quarters. In addition, driven by the recovery of industrial and consumer demand, Jiejie Microelectronics' revenue and profit have shown significant improvement on a quarter-on-quarter basis, with its 8-inch online production capacity utilization rate reaching 96.05% in the first half of the year Entering the performance disclosure period, it is recommended to pay attention to the performance improvement trend of power device companies. We continue to recommend New Energy, Yangjie Technology, Silan Micro, Sd Semi, Huahong Micro, Times Electric, Dong Microelectronics, Hongwei Technology, etc.

Key Investment Portfolio

Consumer Electronics: Luxshare Precision, Pengding Holdings, Lens Technology, Crystal Optoelectronics, Transsion Holdings, Hudian Shares, Industrial Fulian, Dianlian Technology, Kangguan Technology, Guanghong Technology, BOE A, Kingwai Electronics, Shiyun Circuit, Sichuan Jiuzhou, Fuliwang, Wingtech Technology, Yongxin Optics, Hikvision, Sinyang Shares

Semiconductor: Hengxuan Technology, Changdian Technology, Weir shares, Lanqi Technology, SMIC, New Energy, JCET, Sanan IC, Huahong Semiconductor, Loongson Technology, Deming Li, Jiangbolong, Lix Micro, Sili Microelectronics, Times Electric, Zhaoyi Innovation, Yangjie Technology, Tongfu Microelectronics, Jiahua Special, Xin Pengwei, Sirui Pu, Zhuosheng Micro, Fengxiao Technology, Di Ao Micro, Sd Semi, Beijing Junzheng, Dong Microelectronics, Crystal Source, Silan Micro, Huahong Micro, Tianyue Advanced, Aiwei Electronics, Naxin Micro

Equipment and Materials: Zhongwei Company, Dinglong Shares, Xinqi Micro Assembly, Northern Huachuang, Tuojing Technology, Wanye Enterprise, Liang Micro, Hugui Industry

Passive Components: Shunluo Electronics, Fenghua High-Tech, Jiemei Technology, Jianghai Shares

Risk Warning: Downstream demand falls short of expectations; Industry development falls short of expectations; Intensified industry competition