Goldman Sachs: United Imaging’s third-quarter revenue growth accelerates, profit misses Goldman Sachs’ forecast; Goldman cuts price target

Why did profit miss expectations as revenue growth accelerated?

In the third quarter of 2026, United Imaging reported revenue of 3.529 billion yuan, up 24.1% year on year, accelerating from 17.2% in the first half and matching Goldman Sachs’ earlier forecast of 3.392 billion yuan. Net profit attributable to shareholders was 138 million yuan, up 13% year on year but below Goldman’s forecast of 384 million yuan.
Goldman attributed the profit weakness mainly to R&D expenses, share-based compensation and foreign exchange losses. R&D expenses rose approximately 35% year on year in the first nine months of 2026, reflecting the company’s continued investment in next-generation imaging equipment, core components and AI technology; the year-on-year increase in the drag on profit from share-based compensation was 146 million yuan.
Foreign exchange losses were approximately 150 million yuan, compared with just 1.6 million yuan a year earlier. Goldman estimates that, excluding the foreign exchange impact, attributable net profit rose 22.5% year on year in the third quarter and 9.5% in the first nine months.

Goldman estimates that domestic revenue rose approximately 15% year on year in the third quarter, up from 8.5% in the first half, supported mainly by market share gains and increased penetration of high-end products. In the first nine months, the company’s overall domestic market share rose 2.2 percentage points, including gains of 1.6 percentage points in magnetic resonance imaging and 7.8 percentage points in molecular imaging.
Overseas revenue rose approximately 45% year on year in the third quarter, with Asia-Pacific remaining the main driver, although growth was slower than the 54.5% recorded in the first half.

Service revenue rose approximately 24% year on year in the third quarter, up from 20% in the first half; overseas service revenue rose 60.9% year on year in the first nine months.
Goldman believes that as the installed equipment base expands, a greater contribution from high-margin service contracts could drive recurring revenue growth and gradually improve the revenue mix and overall gross margin.

Management remains confident that revenue will grow by more than 20% and profit will grow in 2026, citing a robust order book and the continued commercialization of high-end products. Goldman maintained its 2026 revenue forecast of 16.743 billion yuan but cut its attributable net profit forecast by 10.5% to 1.975 billion yuan.
Goldman cut its revenue forecasts for 2027 and 2028 by 5.1% and 9.9%, respectively, and its attributable net profit forecasts by 15.5% and 15.9%, respectively. An expanded scope of centralized procurement of medical equipment in China could gradually increase pricing pressure; overseas trade tensions, procurement restrictions and geopolitical uncertainty could affect order conversion and deliveries.
Continued R&D spending, overseas expansion costs and potential foreign exchange losses could also constrain a near-term margin recovery. Goldman remains positive on the long-term potential of domestic market share gains, high-end products, overseas operations and high-margin services. It maintained its Buy rating and cut its 12-month price target from 182 yuan to 169 yuan.