Business strategy: The comprehensive outbreak of electronic price increase tide is a structural change driven by the explosive growth of AI industry and the increase in upstream raw material costs.

CITIC Securities stated that the recent wave of price increases in the electronics industry has fully erupted. This round of price increases is not simply a periodic fluctuation, but a structural change driven by the explosive growth of the AI industry and the simultaneous rise in upstream raw material costs. In Q2 2025, benefiting from reduced production from original factories and improved end demand, the prices of memory chips are expected to reach a turning point in their cycle. With major manufacturers shifting their production capacity towards high-margin products like HBM, the supply of consumer-grade memory chips continues to shrink, leading to a widening gap between supply and demand, and prices continue to rise. By the end of 2025, as costs of industrial metals and other raw materials also rise rapidly, price increases will gradually spread from memory chips to passive components, packaging and testing, and other links in the entire industry chain, leading to increased cost pressure on end consumer electronics. Since the beginning of 2026, top manufacturers have been issuing price increase notices one after another, signaling a comprehensive trend of price increases in the electronics industry. Looking ahead, AI demand is expected to continue growing rapidly. With a weak U.S. dollar and resource nationalism contributing to long-term constraints on metal supplies, metal prices are expected to continue rising, and the trend of electronics price increases is likely to continue until the end of this year or early next year. It is recommended to pay attention to semiconductor, component, and non-ferrous metal companies that demonstrate resonating supply and demand and improving profitability.