Dahua's 'Profits' Investigated

Author: John Honovich, Published on Jun 15, 2016

Dahua's profits are up 100%+, defying common sense and industry trends.

We hired a China economics expert to investigate the source of those profits to better understand what is truly driving the world's second largest video surveillance manufacturer.

*****'* ******* *** ** ***%+, ******* ****** ***** *** ******** ******.

** ***** * ***** ********* ****** ** *********** *** ****** of ***** ******* ** ****** ********** **** ** ***** ******* the *****'* ****** ******* ***** ************ ************.

[***************]

Financials **********

***** ********** **** **********, **** **% ******* ****** *** ***% ****** ********.

*** ******, ** **********, *** *** **** *****, ******* **** Dahua ****** *** ***** *********** ** ****** *** *** ****** more ****** **** *** **** *** *****. *** *****'* **** competitor, ********* *** ******** **** ************ ******* ********.

Profits ************

*****'* *******, *** **** *******, *** *** ******** ******** ** **** operational ******* *** ****** *********.

**** *** *** ****** ***** **** *** ***** ********* ******:

  • "**** ** ******** ** ***** *** ** **** ****** ***** from. *** ******* ************ ** ************* *****-*************** ** ***** *** ****** *** ********* **** **% ** nearly **%. **** ** ******* *** ****** ********** *********(***** ** ******** ** ******) ************* *********. ***** ***** ********* **** ******** *********, **** ******* **** were ******* ** ***** *** **** **** *** ** ***** rates. **** ** ********* ******** ** ******** ** * ****** of *************. ***********, ********** *********, ********** ***** *** **** **** the ********** ** *** ******* ********, ** ******** ** ********."
  • "*****'* ********* ******* **** **** ******* *** * *** *****. ** ** 2013, **** *** ** *********** ****** ** **.*% ***** ***** it ** *.*% *** ***** ** ****** *******, ********** ** fall."
  • ** *** **** ****: "**** **** ********* ** ***** ******* ************ **** ** **** are * **** ******* *** ******* ****** ** ****** *********  and ***** ** **** ** ******. ************, **** ** **** are * ****, **** ****** **** ****** ********* ** **** lots ** *******."
  • "*** ***** ***** ** ****: ***** ****** ******* ******** ****** by ***-********* *******.  ** *** ******* ***** ***-********* *******, *** drops **% ** * ***** * *****. ***** *** ******* margins, ******* ***, *** *** ************* ******** ** **** *** EPS **** ******* **********, **** **** ******* * ********* **** worrisome *******."

***** ******, **** ****** ******** *********'* ********** *** *** *** see ***** ****** ***** *** *********.

Dahua *******

**** ********** ***** ** *****, ** ** *** ****.***** ** ******* ************* **********, ** ********, **** * ******* ** * ******** **********.

***** ***** ** *****, ** **** ** *** ******* **** that ******* ********* *** *******, *** ******* ***** ***** *** future ** *** ******* ************ ******. ** ** ***** **** carefully ******** *** ***** **** ******* ** ***** *********.

Comments (14)

** ******* *** ******* *** ******** ** ** *********** *******? Does ** **** ********** **** ***** ******* ****** ** ***** upwards ** ***** *** ****** ** ** ***** ********** "*****" continue ** ********* *** *******? ***** *** *** ****** *** too *** ** ** ******* *** ** **** *** ******* able ** ******* **... * ***** ** **** ******** ********.

*** *******, *** **** *******, *** *** ******** ******** ** true *********** ******* *** ****** *********.

*** *** ******* ****, **** ** ***-**** ******?

*** *** **** ********, ** ****?

*** **** ** ***** ******** ** ****** ***** ** ********, shouldn't ******* ** ****** ***?

** **** ***** **** *** *** ****** ***** ** ******** but ******* **** **** **** **** ***** ** ******** ** the ******.

***** **** ***** ** ***** (*** ***** ** *****) **** are * **** ******* *** *** * ********** ******* *******. They ****** ******* ******* **** **** **** ** *** ** they ***'*, ** *** **** *** **** **** **** ** profit ** ***.

***** ********* **** **** * ***** **** ** ****, **** a "*****" *** ****** ***** ********* **** ****** ** ****-****** or *** ***** ****** *** ** ***** ***** *** ******* or ***** *** ********** ** ***** ******** ********* *** *** cloud *** ******** ** ****** *********.

** **** ***** **** *** *** ****** ***** ** ******** but ******* **** **** **** **** ***** ** ******** ** the ******.

** **** ******* ** ********** ****** * ******?

******, **** **** "**** *******" *** **** *** "******** ** continue".

*'* *** * ********* ****** ** * ***** ** *****.
**** **** * ********** **** *** "*******" **** *** *** will *** **** **** *** *** ****** *** ********* **** they **** ******* ** *** ******.

*** **** ** **** *** ***** *** *** *** **** get ******** *** **** ******... ** **** **** **** **** have ***** ***** ****** ** ***.

******* ***** **** **** *** ******** ***** *****. ** ** they **** ** *** **** **** **** **** ** *******. This ** **** ********** *** ********* ** **** ** **** risks ******* ** ******** *****.

** **** ***** * ***** * ****** **** **** *** let ******* **** **** **** ********* ******* **** *** **** the **** :)

**** ********** ** *** "******* ******" *** ********* *****.

*. *** ***** *** ******/**** **** ***-********* ********** (***-********* ******) for ** **** ** *.*** ***, ***** *% ** *** total *****-*** ****** **** ***.

***** *** *** *** *** **%?

*. ***** *** ** ******** ** ***-********* ****** **** **** Q1 ** **** **. *** ** *** *** ***********.

** **** ***-********* ******: *.*** ***

***. *********: *.*** ***

*** ** ***** ******* ********: *.*** ***

** **** ***-********* ******: *.*** ***

***. *********: *.*** ***

*** ** ***** ******* ********: -*.*** ***

*. *** ***** ******** ** ************* ** **** ** ** a ****** ** "*** ****" ** **** **.

**** ** ***** ******: **** ***

**** ** ***** ******: *** ***

**** ** ***** ******: **** ***

***** *** **** *** + ****** ** **** **. **** Q1, ******* *** ************ ***, **** ****** *** ******* ********* from ****.

**** **, ***, *** * "*** ****", ******* **** *** Dahua ********** ************ **** **** ******* **** *** ** **** when *** **** ****-**-**** ******* *********** ******* "******", ********* **** see * *** **** *** ***** *** ******* **** ****** stock *****.

**** *** * *** ****** ** ******** ** *****'* "*** Bath":

*. ** **** *** ***** ******** ** ********* ******* (********* loss ********** ** ********* *** ***** *****; ***** ** ***** subject ** **********'* ************.)

*. *** *******, ***, *** *** ******** ****** *** ******** principle *** ***** ****** **** ** *** ****** ******* ** this *******, **** ** ********* *** *****;

*. ***** *** **** **** ** ********** ******* ** ****** advantages ** ********** ********** ************, **** ** ************ ** ********* R&D ***** *** ******** *********** **** ***.

**********:

**** *** ****** *** ***% ******** ** **** ** ** simply *** ** *** ************ ******* **** **.

**** **, ***, *** * "*** ****", ******* **** *** Dahua ********** ************ **** **** ******* **** *** ** **** when *** **** ****-**-**** ******* *********** ******* "******", ********* **** see * *** **** *** ***** *** ******* **** ****** stock *****.

****** **** **** ** *** ***** ******* ** **** ******** of * *** ******* *** ** **** ****.

** **** **** ****** * *** ****, **** ** ***** imagine **** *** ******** **** ************* ******, *** ************* ******** lower. *** *** ****** *** **** ******** ****, *** **** reason *** *** ****. ******** ** *** **** ******** **** at ****, ** ** * ****** * ****** ******** ** unhinge ********* *** ** ***** ********** ** ****** ******** ********* by ********* ** ********** *** ******?

*** *** **** ****** ** ******* ** * ******? *** then **** *** **** **** *** ****** **** **, **** a **** ****** ***, ** **** **** *** ** ***** under *** *** ** *** ****?

...*** ***** ********** ************ **** **** ******* **** ***.

** ******, * ****** ****** *** *** **** ** ********** trashes * *** ******, *** ***** ** ***** ******* **** are *** ** *** ***** ***** ****** *** **** ******. Or * ******** *** ****** *** ******** ***'* **** ******* to **** *** ****** **** **** ******.

**** ******* **** ***** ** *** ******* ** ********* *** the **** **** ***** ***** ***** **** ** ********* ******** by *** ********* **********, **** ***** *** *********** "****" ******* reinstates *** ********.

*** ** *** **** ** *****, ** **** ** *****/*******/********* who **** ~**% ** *** *****. ** **** ************ *** likely **** ********** *** ********** ******* *** *** ****** ** likely ******** ** **** *****.

*** **** **** *** ********** **** * **** *** ***** preclude ***** ********* *** *** ****. *** ***** *** * totally ********* ***** ****** **** ***** ************ *** ********* ******* tradings.

** *** **** ** *****, *** *** ******* *** *********** that ******** *** ******* ** ** ********** *** ******* ******** by ******** *** ******* ** *** ********** ******?

*********, *** ******** ********* * *** ****. *** ********* ** provision, ***** ******* *** *****. ******* ******* *** *** ** 2015 ** ** *** ********** ** **** **.

**** **** ******** **** ********** ** *****, * **** *** accounting *** ********* *** ***** **** *** ************; *** *** sales **** ******** ** *** ****** ***** ****** ** ****-**** relationship **** **** ***** ***** ** *** ******* **** * period ** ****; *** **** ****** **** **** *********** ** pre-paid *******.

******** * **** ******* *** *** **** ***** *** ******** and ******** ******* ***** *****, *** ** *** ***** *** still ********* *** ********* ** ****** **** *** ************ ** new ***********, ** ***** ** ***.

*** **** ****** ******* ** ** * ******/********** ** **** is **** *** **** ** ********* *********. ***** *** *** get *** **% ** * ***** ** ***-********* ****** **** total ******?

** *** **** ** *****, *** *** ******* *** *********** that ******** *** ******* ** ** ********** *** ******* ******** by ******** *** ******* ** *** ********** ******?

** ** ******* *** *******, ** ***** ****** ******* ** buy ** ******* *** **** ****** ** *** ***** ********?

****'* *** *******, **** ******* ******* ***** *** ** ************ without ** ******'* **********. *** **** *****'* **** ** ** to ** ****** *****

**, ****** **** *** ***** ** *** ******* ** *** pre-dump *****, ***** **** ** ********* ***, ** ***** ** least, *** ******* **** *** ******** ****** ** *** ********. Sure ** ***** **** **** ******** ********** **** ****** ** pre-bath ****** *** *** ***** ***** **** ** ***** ** was, ** ** ***** ** * ****, *** **** **** he's *** * ****** ** ***** ** *% ******, *** tarnished *** *******'* ********** **********.

** ***** ** *** ******* *** *** ****** ***-**** *** bought **** **** ****-****? *****, ** ***** **** ** ** a *****, ***** ****-*** ***-**** ** ******* ******* ******** ****** you ***** ***.

* ***'* **** ***** *** **%, *'* **** **** **** answer **** ******.

*** ******* ******* *** ** ***** ******* ***. ******, *** stock ****** *** ***** ********** ** *** **** ** ******.

** *** **** ****, *** ******** ** *** ******* ***** be *********** *********. *** **% ******** ** ***** ******* ** 2015 ** ********* ** **** ** ***** ** **** ***** jobs. *** *****.

*** **** ** **** ***** *** ********** ********** ******* *** Dahua ** ***** * ********** *******.

****, ********** ***'** *** ****** ***** *****, **'* **** **** in **** ********** **** ***** *** ********* ** **** **** 50% ** *** ******* *****, *** ******** **** ************* ********* the ***** ***** ** ******** ** **.

*** *** ******** **** ***** *** *******'* ********* ******** **** you **** * ****** **** *** *** ****, ** *** you ******* ****-***?

** * ******* ****, ** *****, *** *** **** ******* as *****?

**, *** ****/******** *** ******* *** ***** ****** ** ******* expense, * ******* ***** *******. ****** ** *** ******* *** same ***** ** ******* ***. *** *** **** ** ** is ** ******** *** ******* **** *** ******** *** ******** future ******* ** *** ******* ****** * ****.

*** ********* ****** **** **** **% ***** ******. ** *** case ** *****, ** ****** ***** ** ***** ******* *** for *** ***** **** ** ****** *** ******* ************ ***. No *** ******* ** ***** *** ***** *****. *** **** of *** **** ** ****** ** **** *** ****** ** one ****** ** **** ***** ******* ***** **** ****. *** stock ***** ********** ** ****** *** ************ ** *** ******* management. ****'* ** ******** ********.

***** ***, ** ******* **** *** ******* ****** ****** **** you **: *** ****. *****.

*** *********** ********:

******** * ******* ********* ********* ******** ** ****, ***** ** meetson *******, which of results would you think the market would react the most positively to?

**:*****:******:*****:****

**:******:******:*****:****

**

**:*****:******:*****:***

**:******:******:*****:****

*, ******** **** *** ******:

*'* *** **** ******* **** ******* **/*** ** ******* **. According ** ****, *** ******* ******* ** *********, ***** *** can *** ** ************** * **** *********** *********** **** * ***** **** *******, ***-********* ******* *** 161m *** *** ***-********* ******** **** *.* *******. ***** ** not * ******** ********* **** **** *** ***-********* ****** ** I ********** **** ***** **** ***-********* ******* ***** ***-********* ********. The ***-********* *** ********* ****** ** *** *** ********* ** total ****** *** **** ** ******** ********. ********* ****** (*********** in ****) ** ****** ** *********; ************ ****** ** ****** as **** ***. ******** ***** *** ***** *** ** **** RMB. *** ****** (*********** ** ******) ** ** ** ****** as **** *** *** * ********** ** **** **%. ***** expected ******* ** *** ****** **** ** ***** *** ******* items, **** ********** ** ***** ****** ** ** **********. *** reason * ******* **** ** ** ********* **** ******** ****** operating ****** *** ** *********** ** ***-********* ****** ********* ****** closely ** *** ******** *** ****** ******.

** *** **** '*** ****' ********, *** ********:

**** ** ********** **** ****** **** ********. * ***** **** however * ****** ** ******. *****, **** ** ********** ****** practice *** ***** **** **** *********** **** ****. ******** **** rush ** ***** ******* ** **** *** ****** **** ***** there ** * *** ******* ** ****. * ****** **** this ** * *****. ******, * ***** ** ** ******** we *** ********* ** **** ******** ***** ****** ** **** lots ** ****** *********** *** *** ******* **** *********** ** start ******** "******" **********. *** *********/**** ******* **** ** ****** correct ***** *** **** **** ******* ******* *****. *** **** reasons ******, * ***** ** *** ** * ******** ******* unless ** ****** ** ** * ************* ******** *** *** this ***** ********** ****** *******. ** **** * ****, *** me *** * ****** *******. ****** ***** ** *******, ***'* assume *** ****** ****** ** **** *** ** ** **** and **** ** ****. **** ** ** *** **** **** their ***** ******* *** *** ******* *** ******* * ****** between **** *** **** **** ********** ****** *** *******? *****, most ********* ***** **** **** ** ******** **** ***** ********. They **** **** *******, **** **** ** ** **** **** for **** ** **** *** **********, ** **** **, **** they **** ***** ** **** ***** ********. *** *** ***** in *** ****, *********** ***, *** ***'* ***** ***** *** revenue ** **** ********** **** ****. ** *****, *** ********* is ******** *****. ** ****, ** **** ** *** ******* accounting ******* **** ******* *** **** ***** ********** *****. *******, it ***** ** *********** ********* ** ******* ****** ******* ** an ******** *** ********* **** **** *** ***** ********* ***********.

Login to read this IPVM report.
Why do I need to log in?
IPVM conducts unique testing and research funded by member's payments enabling us to offer the most independent, accurate and in-depth information.

Related Reports

Hikvision China Criticizes The WSJ on Nov 15, 2017
Hikvision, through the Chinese government's authoritative news service, has criticized the WSJ investigation into Hikvision. In this...
Dahua Launches Electric Cars on Nov 13, 2017
Embattled mega video surveillance manufacturer Dahua is now electric car manufacturer Dahua. Let the jokes begin: But is the joke on Dahua's...
WSJ Investigates Hikvision on Nov 13, 2017
The Wall Street Journal (WSJ) has released a detailed investigation into Hikvision's government ownership and cybersecurity problems, hitting the...
Bubble: Dahua Doubles Market Capitalization on Nov 07, 2017
Dahua's stock is in a bubble. Those of you in the industry know how bad of a year Dahua has had - the zero-day backdoor, the massive hacking...
Dahua USA Removes Head of Marketing on Nov 06, 2017
Dahua USA's marketing and just their overall business organization has been a mess. These guys could not sell life jackets on the Titanic. But,...
CPSE 2017 Highlights on Nov 01, 2017
CPSE 2017, the largest security-oriented exhibition, held in China, has wrapped up. Inside we cover some top trends from the show,...
Failed Arecont China Acquisition on Oct 25, 2017
Arecont cameras are not the only things that fail. Arecont spent months trying to be acquired by a Chinese manufacturer, only for the deal to...
Hikvision Admits Backdoor 'PR Issue' on Oct 24, 2017
Hikvision is admitting a problem. The backdoor itself is evidently not the problem for them. The problem, according to Hikvision, is a public...
ADI To Be Spun Out of Honeywell on Oct 10, 2017
Honeywell has announced it will spin off ADI and its Home products division into a new public company. This is a big move for the mega-security...
Knightscope Financials Reveal Huge Increase In Expenses And Incorrect Accounting on Oct 02, 2017
Knightscope's H1 2017 financials are out, in the midst of their ongoing crowd funding approaching $17 million. In this note, we analyze...

Most Recent Industry Reports

Panasonic Unified Surveillance Strategy Analyzed on Nov 17, 2017
Panasonic is now a "Unified Surveillance" offering, as their ASIS 2017 booth proclaimed: Looking to make a comeback in the security industry,...
Amazon Cloud Cam Is Poor (Tested) on Nov 17, 2017
Retail behemoth Amazon has entered the surveillance market with the Amazon Cloud Cam, the eyes of its just-announced Amazon Key delivery...
Nest Secure Alarm System Tested on Nov 16, 2017
Google's expansion continues, this time into home security with their Nest subsidiary's move into alarm systems. They paid more than a...
Dahua Forbes 'Next Web Crisis' Vulnerability Dispute on Nov 16, 2017
The buffer overflow vulnerability in Dahua products is not in dispute, in fact we covered it when it was first published. What is in dispute is...
Isonas Cofounders Split, Launch Partner/Competitor on Nov 16, 2017
Breaking up is hard to do, especially when door access security is at stake. But that is exactly what has happened at Isonas. Senior employees...
Hikvision China Criticizes The WSJ on Nov 15, 2017
Hikvision, through the Chinese government's authoritative news service, has criticized the WSJ investigation into Hikvision. In this...
Axis Commits To Long-Term Firmware Support on Nov 15, 2017
With the rise of cyber security awareness, and a general increase in hardware reliability, "software warranties" may prove more valuable than...
Hikvision NVR 4.0 Improvements Tested on Nov 14, 2017
Hikvision has released firmware version 4.0 for select NVRs, touting two years of research and development, and claiming "the new generation GUI...
Vivotek Remote Stack Overflow Vulnerability on Nov 14, 2017
A stack overflow vulnerability in Vivotek cameras has been discovered by bashis, the security researcher who has also found vulnerabilities in...

The world's leading video surveillance information source, IPVM provides the best reporting, testing and training for 10,000+ members globally. Dedicated to independent and objective information, we uniquely refuse any and all advertisements, sponsorship and consulting from manufacturers.

About | FAQ | Contact