Q Tech (01478) extended its decline on Thursday, dropping more than 3% in early trading before paring losses to trade 2.83% lower at HK$6.005, with turnover reaching HK$47.09 million. The stock has been under pressure following the release of its first-half results, which fell short of market expectations.

The company posted revenue of RMB 9.923 billion for the first half of 2026, up 12.36% year-on-year, while profit attributable to shareholders declined 10.49% to RMB 276 million. Gross margin contracted by approximately 0.8 percentage points to around 6.6%, and the company declared an interim dividend of HK$0.15 per share.

Citi Research issued a note stating that Q Tech's H1 performance missed consensus estimates, primarily due to an unfavorable product mix in its camera modules segment and low capacity utilization at its fingerprint recognition module business, which weighed on gross margins. Additionally, increased R&D spending on IoT and premium automotive products further pressured profitability.

Based on the company's first-half results and outlook, Citi has lowered its earnings forecasts for Q Tech for the 2026-2028 period by 13% to 16%, and cut its target price from HK$9.0 to HK$6.9, while maintaining a "Neutral" rating on the stock.