Largan Precision Earnings: Android Shipments Volume and Periscope Profitability Disappoint

We trimmed our fair value estimate for Largan Precision to TWD 2,500 from TWD 2,600 following its second-quarter earnings call due to the weaker-than-expected outlook in Android sales and profitability of periscope lenses for Apple. Largan alluded that shipments of its midend lenses would outperform its higher-end lenses in the second half, but we doubt if it is enough to compensate for the disappointing first-half revenue as the overall smartphone market outlook for 2023 has declined further. We view Largan’s shares as fairly valued as the upside from its periscope lenses, highly likely to be released in the iPhone 15 Pro Max telephoto camera, has already been fully priced in.