1. What Happened? Q3 Earnings Summary

BH reported Q3 2025 revenue of KRW 389.7 billion (vs. estimated KRW 405.1 billion, -4%), operating profit of KRW 16 billion (vs. estimated KRW 13.1 billion, +22%), and a net loss (vs. estimated KRW 10.3 billion profit). While operating profit exceeded expectations, the net loss is a negative signal for the market.

2. Why These Results? Analyzing the Underperformance

The primary driver of the net loss is the underperformance of the FPCB division. Rising raw material costs and low production capacity utilization negatively impacted profitability. High dependence on Samsung Display also poses a risk. The automotive electronics division performed relatively better, but sales still declined year-on-year.

  • External Factors: Rising raw material prices, unfavorable exchange rates, interest rate hikes, and the global economic slowdown also contributed to the negative performance.

3. What Now? Investment Strategy Recommendations

The outlook for BH remains uncertain. Key factors to monitor include the FPCB division’s ability to improve competitiveness and diversify its customer base, the growth trajectory of the automotive electronics division, and the evolving macroeconomic environment. We recommend the following investment strategy:

  • Risk Management: Construct a portfolio that accounts for the elevated financial risks.
  • Monitoring: Continuously monitor raw material prices, exchange rates, interest rates, and global economic conditions.
  • Information Gathering: Review the detailed Q3 report and assess future management plans.

Currently, a ‘wait-and-see’ approach or a strategy focused on ‘risk management’ is more appropriate than outright ‘buy’.