In the previous article on semiconductor classification, we compared the differences between analog chips and digital chips, and introduced the connections between analog chips and sensors, optical devices.In fact, analog chips are present in every aspect of our lives. When we fast charge our phones, accelerate smoothly in electric vehicles, or listen to clear music with wireless headphones, there is an easily overlooked “invisible hero” behind it all—analog chips (also known as “analog ICs”).Unlike digital chips (such as CPUs and AI chips), which frequently appear in the news, analog chips act as the “nervous system and steward of electronic devices,” silently regulating voltage, amplifying signals, and filtering noise to ensure the stable operation of every electronic device.For ordinary investors like us, analog ICs represent a high-quality track in the semiconductor industry that is both offensive and defensive: they are not as heavily impacted by fluctuations in computing power cycles as digital ICs, nor do they have low valuation elasticity like discrete components; they have a long lifecycle (a product can be sold for over 10 years), high technical barriers (design relies on accumulated experience), and benefit from long-term growth scenarios such as electric vehicles and industrial control.This article will use a “life scenario + product examples + listed companies” approach to break down the core logic of analog ICs, helping everyone understand this “low-key yet important” investment track.1. First, fully understand: What are analog chips?Many of us cannot distinguish between “analog ICs” and “digital ICs”. In fact, the core difference between the two lies in the “type of signal they process”—just like “recording temperature”: analog ICs continuously display temperature using a mercury column, while digital ICs display discrete numbers like 25°C on an electronic screen.1. Analog ICs: The “translator + steward” for processing “continuous signals”.The core function of analog ICs is to “communicate with the physical world”—converting continuously varying signals in reality (such as sound, temperature, voltage, light) into electrical signals, or amplifying, filtering, and stabilizing electrical signals before passing them to digital ICs for processing. They act like the “nervous system of electronic devices”:For example, our voice (a continuous signal) is amplified by the analog IC in a microphone before being transmitted to a digital IC to be converted into 0/1 data;For instance, the battery voltage of an electric vehicle (which fluctuates during charging/discharging) is stabilized by an analog IC (power management chip) before supplying power to the motor and central control screen.2. The core difference from digital ICs: “Stability” vs “Speed”.Digital ICs process “0/1 discrete signals”, pursuing “fast computation speed and high integration” (for example, CPUs perform billions of operations per second); analog ICs process “continuous signals”, pursuing “low signal distortion and high stability” (for example, power management ICs must have an output voltage error of less than 1%).Using a “factory production” analogy:Digital ICs = “assembly line workers”: quickly assembling parts (0/1 data), focusing on efficiency;Analog ICs = “quality inspectors and equipment maintenance personnel”: ensuring parts are qualified (signal quality) and machines are stable (normal voltage/current), focusing on reliability.3. Why are analog ICs “indispensable”?Without analog ICs, digital ICs would be “cooking without rice”—digital ICs can only process 0/1 data and cannot directly perceive the physical world:No matter how powerful a mobile phone SoC (digital IC) is, without an analog IC (RF chip) to receive 5G signals, it cannot connect to the internet;No matter how high the computing power of an AI chip (digital IC) is, without an analog IC (ADC converter) to convert the temperature/pressure signals from sensors into digital data, it cannot process real-world data.2. Classification of analog chip functions: Six core branches covering all electronic devices.Based on functionality, application scenarios, and technical characteristics, analog ICs can be further divided into the following six core branches, each with significant differences in technical paths and market demands:1. Signal Chain ICs (Core Function: Signal Processing and Conversion)Definition: Handles the complete signal chain from sensor input to digital system output, including signal acquisition, amplification, filtering, conversion, and transmission.Core Subcategories:Amplifiers and Comparators: Operational amplifiers (such as high-precision products from Sanken Electric), high-speed comparators (such as RF front-end chips from Siretta).Data Converters (ADC/DAC): High-precision ADCs (such as 24-bit industrial-grade chips from Chipsea Technology), high-speed DACs (such as medical imaging chips from Shanghai Belling).Analog Switches and Multiplexers: Used for signal routing, typical manufacturers include NXP Semiconductors.Application Scenarios: Industrial automation, automotive electronics, medical devices, etc., where high signal accuracy is required.Related Stocks:Sanken Electric (300661.SZ): Covers amplifiers (high-precision/high-speed/low-power), ADC/DAC, and all categories of analog switches, with signal chain revenue accounting for 33.99% in 2024, of which amplifier revenue accounts for 45% of total signal chain revenue; automotive-grade products have entered the supply chains of BYD and Great Wall, with the Jiangyin base focusing on special testing.Siretta (688536.SH): A leader in high-precision signal chains, with high-speed operational amplifiers reaching bandwidths of 1GHz (suitable for 5G base stations/industrial testing), developed in collaboration with SMIC using 55nm BCD technology.NXP Semiconductors (688052.SH): Global market share of 41% in isolation chips, automotive-grade isolators/magnetic sensors have entered BYD and Continental Group, suitable for industrial isolation communication and automotive electronics.Shanghai Belling (600171.SH): High-speed, high-precision ADC/DACs are widely used in industrial control and medical imaging, solving precision issues in complex signal conversion scenarios.Chipsea Technology (688595.SH): Industrial-grade 32-bit ADCs have a market share of 8-10% (24-bit ADCs compete with ADI), high-precision ADC+MCU integrated solutions are used for industrial measurement/automotive electronics, and automotive-grade BMS chips have passed ASIL-D certification.Shengjing Micro (603375.SH): Subsidiary Shanghai Xianji focuses on signal chain chips, entering the drone sector, focusing on signal processing for low-altitude flying vehicles.Zhenhua Fengguang (688439.SH): Leading market share in military signal chain chips, radiation-resistant chips are used in satellites/space stations; high-reliability operational amplifiers (highest radiation resistance level in the industry) are suitable for military radar and aerospace equipment signal processing needs.2. Power Management ICs (Core Function: Power Control and Distribution)Definition: Responsible for the conversion, stabilization, distribution, and protection of electrical energy, serving as the “power hub” of electronic devices.Core Subcategories:AC-DC and DC-DC Converters: Such as the automotive-grade DC-DC chips from Silan Micro.LDO Regulators: Sanken Electric’s low-power LDO products account for over 65% of the power management business.Battery Management Chips (BMS): NXP’s automotive-grade BMS chips have passed ASIL-D certification.Application Scenarios: Consumer electronics, electric vehicles, servers, etc., where energy efficiency and stability are highly demanded.Related Stocks:Silan Micro (600460.SH): A leader in the IDM model, automotive-grade power chips are used in servers/automobiles, with significant advantages in chip design and manufacturing synergy.Sanken Electric (300661.SZ): Power management product revenue accounts for 65.18% (including DC-DC, LDO), steadily increasing market share in consumer electronics/industrial sectors.NXP Semiconductors (688052.SH): Power management products include gate drivers and power supplies, with revenue accounting for 35.87% in 2024, rapidly growing automotive electronics business, suitable for electric vehicle control systems.Nanchip Technology (688484.SH): A pioneer in domestic fast charging protocol chips (supporting 240W fast charging), automotive-grade products cover battery management, with clients including leading mobile phone/electric vehicle manufacturers.Jiehuate (688141.SH): Multi-phase power controllers suitable for AI servers, automotive-grade products lead in energy efficiency, focusing on high-performance power solutions for industrial/automotive applications.Aiwei Electronics (688798.SH): Audio amplifier chips have a market share of 82%, with automotive-grade products in mass production, addressing audio power supply needs for automotive/consumer electronics.Jingfeng Mingyuan (688368.SH): LED lighting driver chips lead global market share, using third-generation semiconductor integration technology, suitable for green lighting/smart appliances.3. RF ICs (Core Function: High-Frequency Wireless Signal Processing)Definition: Specializes in processing high-frequency signals from 300kHz to 300GHz, serving as core components in wireless communication.Core Subcategories:RF Front-End Modules: Including power amplifiers (PA, such as Weijie Chuangxin), low-noise amplifiers (LNA, such as Zhuoshengwei).RF Switches and Filters: SAW/BAW filters (such as Maijie Technology) suitable for high-frequency bands in 5G mobile phones.Wireless Connection Chips: Wi-Fi, Bluetooth modules (such as Broadcom Integrated).Application Scenarios: Smartphones, base stations, automotive radar, satellite communication, etc.Related Stocks:Zhuoshengwei (300782.SZ): A leader in RF front-end, products include RF switches and LNAs, with clients covering Huawei and Xiaomi, planning L-PAMiD, WiFi7 modules, and automotive-grade UWB chips by 2025, with over 20% market share in consumer electronics RF front-end.Weijie Chuangxin (688153.SH): Supplier of RF PA modules, bound to Xiaomi and vivo, automotive-grade PA entering electric vehicle radar and vehicle networking.Huizhiwei (688512.SH): RF front-end covering smartphones/wearable devices (supporting 5G Sub-6GHz), balancing RF performance and cost for mid-to-low-end models.Broadcom Integrated (603068.SH): Wireless connection chips (Wi-Fi, Bluetooth) used in smart transportation, automotive-grade products entering BYD’s supply chain, suitable for in-vehicle central control and smart cockpit.Maijie Technology (300319.SZ): SAW/BAW filters meet high-frequency demands for 5G mobile phones, with BAW products certified by Huawei, breaking overseas monopolies.Xinjingang (300629.SZ): Military RF front-end chips (microwave devices/components) have over 30% market share, used in anti-drone systems and military radar, with military trade orders accounting for over 40%, outstanding anti-interference performance.Leidian Weili (301050.SZ): Millimeter-wave active phased array microsystems (core components for RF signal processing), used in satellite communication and guided weapons, with 10 times better anti-interference capability than traditional solutions, with a surge in orders for the Falcon fighter jet.Zhenhua Fengguang (688439.SH): RF direct acquisition chips cover the 2-18GHz frequency band, suitable for military radar and satellite communication equipment, collaborating with its military signal chain business to form a “signal processing + RF transmission” military solution.4. Interface ICs (Core Function: Signal Transmission and Protocol Conversion Between Devices)Definition: Achieves communication protocol conversion and signal level matching between different devices.Core Subcategories:Serial Communication Interfaces: UART, SPI, I2C chips (such as Siretta’s industrial-grade RS485 chips).High-Speed Interfaces: USB-C, HDMI, PCIe controllers (such as Nanchip Technology’s fast charging protocol chips).Isolation Interfaces: Digital isolators (such as NXP’s magnetic isolation chips) used in industrial and automotive electronics.Application Scenarios: Industrial automation, smart homes, automotive electronics (such as CAN/LIN buses).Related Stocks:NXP Semiconductors (688052.SH): Digital isolators have a market share of 41%, with automotive-grade products covering electric vehicle BMS and industrial isolation communication, achieving the highest EMC performance in automotive-grade standards.Siretta (688536.SH): Provides RS485 and I2C buffer chips, with industrial automation revenue accounting for over 40%, collaborating with CATL on BMS interface solutions to ensure stable signal transmission for power batteries.Sanken Electric (300661.SZ): CAN transceivers and RS485 chips are used in automotive electronic control systems, with significant automotive-grade interface orders expected by 2025, suitable for body control and chassis electronic control.Lihui Micro (688589.SH): A leader in PLC chips (power line communication), used in smart grids/smart homes, solving long-distance transmission challenges in power systems.5. Display Driver ICs (Core Function: Controlling Pixel Emission on Display Panels)Definition: Converts digital signals into analog voltage or current to drive LCD/OLED panels to display images.Core Subcategories:LCD Driver Chips: Source drivers and gate drivers, such as Gekewei’s small and medium-sized products.OLED Driver Chips: Integrating timing control and power management, such as Mingwei Electronics’ Mini-LED backlight drivers.Touch Display Integration Chips (TDDI): Integrating touch functionality with display driving, such as Tiande Yu’s smart terminal chips.Application Scenarios: Smartphones, automotive displays, AR/VR devices, etc.Related Stocks:Gekewei (688728.SH): Display drivers used in smartphones/wearable devices, with global shipments ranking third in 2024, focusing on small and medium-sized LCD drivers suitable for low-end terminals.Jingfeng Mingyuan (688368.SH): LED lighting drivers lead global market share, using third-generation semiconductor technology, suitable for green lighting.Mingwei Electronics (688699.SH): LED display drivers support Mini-LED backlighting, entering the BOE supply chain, addressing high brightness and low power consumption needs.Tiande Yu (688252.SH): TDDI chips (touch display integration) cover mobile phones/tablets, with AMOLED drivers passing BOE certification in 2024, suitable for mid-to-high-end panels.6. Sensors and Analog Front Ends (Core Function: Physical Signal Conversion and Preprocessing)Definition: Converts physical signals such as temperature, pressure, and light into electrical signals, and performs amplification and filtering.Core Subcategories:Sensor Interface Chips: Magnetic sensors, pressure sensor interfaces (such as NXP’s automotive-grade magnetic current sensors).Analog Front Ends (AFE): Integrating ADC and signal conditioning, such as Chipsea Technology’s industrial measurement chips.MEMS Sensors: Microphones, inertial sensors (such as Minxin’s automotive-grade pressure sensors).Application Scenarios: Automotive electronics (such as tire pressure monitoring), wearable devices, industrial IoT.Related Stocks:NXP Semiconductors (688052.SH): Magnetic current sensors have passed automotive-grade certification, bound to BYD and NIO, with sensor interface revenue accounting for 28% in 2024, used for current detection and motor control in electric vehicles.Chipsea Technology (688595.SH): High-precision ADC+MCU integrated AFE solutions are used for industrial measurement/automotive electronics, with a market share of over 20% for photovoltaic inverter AFE.Minxin (688286.SH): MEMS microphones/pressure sensors lead the domestic market share, with automotive-grade pressure sensors entering Tesla’s supply chain by 2025, used for tire pressure monitoring and cabin environment detection.Xindong Lian Technology (688582.SH): MEMS inertial sensors have a gross margin of 85.03%, used in aerospace/autonomous driving, with 10 times better anti-interference capability than traditional solutions.3. Supplementary Explanation of Analog Chip Industry ClassificationClassification logic from authoritative institutions:Texas Instruments (TI) classifies analog ICs into six categories: signal chain, power management, interface, RF, amplifiers, and data converters.EE Times points out that analog ICs can be divided into general-purpose (power management, signal chain) and specialized types (RF, display drivers, sensors, etc.), with the latter accounting for 61% of the market.Technical barriers in segmented fields:RF ICs: Require mastery of high-frequency processes (such as SOI, GaAs) and complex modulation techniques, with domestic manufacturers still relying on imports in high-end fields like L-PAMiD modules.Display Driver ICs: OLED drivers need to address pixel lifespan and power consumption issues, with domestic manufacturers increasing their market share in small and medium-sized markets to 30%.4. Core Investment Logic of Analog ICs: Why is it a “Stable Track”?For ordinary investors, the appeal of analog ICs lies not in “explosive growth” but in “long-term stability + significant domestic substitution potential”. The core logic has three points:1. Long lifecycle, small performance fluctuations.The technological iteration speed of analog ICs is much slower than that of digital ICs (digital ICs update every 1-2 years, while analog ICs can go 5-10 years without iteration). Once a product passes customer certification (such as automotive-grade certification, which takes 2-3 years), it can provide stable supply for many years.For example, a certain LDO regulator from Sanken Electric has been in production since 2015 and continues to contribute revenue to the company; in contrast, digital ICs like Intel’s CPUs have seen rapid obsolescence, with the 10th generation Core being replaced by the 13th generation in just three years.Investment significance: Companies’ performance is more stable and less affected by short-term factors such as “computing power cycles” and “consumer electronics replacement waves”, making them suitable for long-term holding.2. High technical barriers and favorable competitive landscape.The design of analog ICs relies not only on “technology” but also on “experience”—for example, controlling the “offset voltage” (signal error) of operational amplifiers requires engineers to optimize through extensive experimentation, making it difficult for newcomers to break through in a short time; in contrast, the design of digital ICs relies more on EDA tools and algorithms, with faster iteration speeds and more intense competition.Currently, the global analog IC market is dominated by foreign companies like TI and ADI (with a market share of over 60%), while domestic companies have achieved substitution in the mid-to-low-end market and are gradually breaking into the high-end market (automotive-grade, industrial), with domestic substitution potential exceeding 50%.Investment significance: Leading companies (such as Sanken and Zhuoshengwei) can maintain high gross margins (generally above 35% for domestic analog IC leaders, compared to 25%-30% for digital ICs) once they establish technological advantages.3. Clear demand drivers: Automotive + Industrial as long-term growth engines.The demand for analog ICs does not rely on a single scenario but is distributed across multiple fields such as consumer electronics, automotive, industrial, and medical, with automotive and industrial being the core growth areas for the next five years:Electric Vehicles: Each electric vehicle uses about $500-800 worth of analog ICs, which is 3-4 times that of fuel vehicles (about $150-200), mainly used for battery management (BMS), motor control, and in-vehicle radar;Industrial Control: Industrial automation equipment (such as robots and machine tools) requires a large number of high-precision analog ICs (such as ADC/DAC, operational amplifiers), with demand expected to grow by over 15% annually as “Industry 4.0” progresses.Investment significance: Demand is diversified and long-term growth is clear, so even if consumer electronics are weak in the short term, automotive and industrial demand can still support the performance of analog IC companies.5. How should ordinary investors select targets? Three key screening criteria.Although the analog IC track is promising, not all companies are worth investing in. Ordinary investors can screen based on three criteria: “track + capability + performance”.1. Prioritize “automotive-grade + industrial-grade” targets.Consumer electronics-grade analog ICs (such as mobile phone LDOs) face fierce competition and low gross margins; automotive-grade and industrial-grade analog ICs have long certification cycles and high technical requirements, allowing for strong pricing power (automotive-grade products have gross margins 10-15% higher than consumer-grade).2. Focus on “design + manufacturing” integrated (IDM) companies.The performance of analog ICs depends not only on design but also closely on manufacturing processes (such as doping concentration in wafer foundries, packaging technology). Companies with an IDM model (self-design + self-manufacturing) can better control costs and performance, giving them an advantage in automotive and industrial scenarios.3. Avoid “pure consumer electronics” companies without technical barriers.Some analog IC companies only produce mid-to-low-end consumer electronics products (such as ordinary LDOs, low-voltage DC-DC), facing price war pressures and continuous declines in gross margins, which should be cautiously avoided.Negative examples: Some companies focused on mobile charger ICs have seen their gross margins drop below 20% in 2024, far lower than the 35%+ of automotive-grade companies.Final Summary:In the semiconductor industry, digital ICs are the “vanguard” (benefiting from AI and computing power growth), while analog ICs are the “steadfast defenders” (benefiting from automotive and industrial growth). For ordinary investors, if you want to share in the growth dividends of the semiconductor industry without bearing the high volatility of digital ICs, the analog IC track is worth focusing on.Remember a core logic: the value of analog ICs lies in their “irreplaceability” and “long-term demand”—as long as electronic devices need stable voltage and clear signals, analog ICs will have an irreplaceable role; as long as electric vehicles and industrial automation continue to grow, the demand for analog ICs will continue to be released. Choose leading companies with “automotive/industrial-grade + IDM model + high gross margins” for long-term investment, and you are likely to achieve good returns in this “stable track”.
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