C114 news: during the 20th CIOE, HG Genuine holds a product release in Four Season Hotel and invites industry partners to discuss about latest progress of HG’s products and technology. With the international design of show booth, 400G QSFP-DD SR8 and SFP+ Combo PON OLT parts are live demoed. Mr. Changfei Hu (General Manager of HG Genuine) has been meeting with customers for the whole morning. He explains that HG would focus on globalization strategy and try to develop into a global optical communication enterprise.
2018 has not been a big year for communication industry. LTE deployment is coming to the end and 5G requirements are not expected to rise until 2019. Backhaul, Transport and Access fields are all waiting for the commercialization of 5G. Operator CAPEX is continuously decreasing and many optical transceiver manufacturers are facing a slowdown in growth or even negative growth.
HG Genuine’s revenue growth is therefore very eye-catching. HG Genuine’s General Manager Mr. Changfei Hu says that in H1 of 2018, CAPEX of operators is less than expected and industry development is negatively impacted by the Trade War. HG has achieved sparkling growth despite the industry dilemma. The revenue of optical transceiver has increased by 30% and net margin grows by 100%. Product sales in Wireless, Access and Data Center sections have all achieved good results.
In the past few years, with continuously rising traffic of global internet, the construction of Data Centers has been a hot topic, especially in North America, where big internet tycoons have become key buyers of optical communication products. Therefore, many Chinese optical transceiver manufacturers are marching into US Data Center markets.
DC markets have different requirements in product quality, purchasing modes and service than Telecom markets. Compared with Operators, Internet companies prefer to purchase optical components directly and requires lower cost and faster product update, which is quite a challenge for suppliers. Frankly speaking, HG Genuine is somewhat late to enter into the DC market. In 2018, HG has determined the strategic priority of globalization and founded HG US subsidiary and built a team with local industry veterans and professionals. A local R&D and Sales team has been built with one strike.