The much-anticipated first domestic DRAM (Dynamic Random-Access Memory, a core requirement for servers and mobile devices where data is lost upon power loss) company, ChangXin Technology, is on the verge of entering the capital market.
Since its IPO application was accepted on the Science and Technology Innovation Board in December 2025, ChangXin Technology has completed review, registration, and issuance preparation in approximately seven months, officially initiating online and offline IPO subscriptions on July 16, significantly accelerating its listing process.
This company, bearing the hopes of breakthroughs in domestic memory chips, has also delivered a starkly different financial performance report on the eve of its listing.
The prospectus shows net profits for 2023 to 2025 were -19.225 billion yuan, -9.051 billion yuan, and 7.144 billion yuan, respectively. For a memory chip company that has long relied on capital investment to catch up with overseas giants, this may signal that its domestic DRAM business has entered a stage of commercialization.
However, whether this round of profit growth can be sustained is the market's primary concern.
ChangXin Technology's Chairman, Zhu Yiming, stated at an investor exchange meeting on July 15 to Phoenix WEEKLY Finance that since the second half of 2025, the company's performance growth has benefited from the AI-driven DRAM demand surge and tight industry supply and demand. However, the DRAM industry is highly cyclical with significant price fluctuations, and the development of AI introduces uncertainty regarding market demand. If adverse changes occur in the macroeconomy, AI demand falls short of expectations, or new production capacity is concentrated for release, the industry could still return to a downturn cycle.
"The industry cycle is responsible for lighting the fire, but the company's capabilities are responsible for turning that fire into profit." Said Huang Lichong, President of Huisheng International Capital, stating that judging the sustainability of profit changes requires looking beyond this year's memory prices and continuously observing unit costs, the proportion of revenue from advanced products, and operating cash flow.
Having Achieved Profitability, Can It Shake Off Cyclical Impacts?
The memory chip industry is capital-intensive and extremely cyclical. The DRAM market has long been dominated by a few oligopolies like Samsung, SK Hynix, and Micron. Industry profitability heavily depends on supply-demand dynamics and product mix, with high-end DDR5 and HBM currently being the core profit drivers.
ChangXin is the only domestic manufacturer achieving mass production of DRAM. Initially starting domestic substitution with DDR4, it now primarily produces DDR5 and LPDDR5X, simultaneously advancing HBM R&D while gradually phasing out older DDR4 products.
In recent years, the global memory chip market experienced a deep adjustment, with price declines and high inventory being pressures shared across the industry, also affecting ChangXin Technology.
The prospectus shows that as of December 31, 2025, its cumulative unrecovered losses reached 36.65 billion yuan. The reasons include the scale-oriented nature of the DRAM industry requiring continuous capacity expansion, alongside high pressure from fixed asset investment and depreciation associated with wafer fab construction.
With the memory cycle reversal, ChangXin Technology's profitability has rapidly recovered.
The prospectus indicates that its 2025 revenue growth mainly stemmed from two aspects: first, an increase in DRAM product prices, and second, expanded production/sales scale and optimized product mix. Specifically, the average selling price of ChangXin's main DRAM products rose by 33.69% year-on-year.
"The industry cycle is merely an external factor for profit improvement; the enhancement of the company's own capabilities determines whether profits can be truly realized." Huang Lichong believes that if there was only price increase without improvements in product, capacity, and cost capabilities, profits wouldn't have been released so quickly.
The prospectus shows that in 2025, while the unit price of ChangXin's DDR products increased by 61%, the unit cost decreased by 26.26%; for LPDDR products, the unit price rose by 24.46% while the unit cost fell by 22.85%. ChangXin's comprehensive gross margin improved from -1.93% in 2023 to 40.99% in 2025, approaching levels of overseas manufacturers like Samsung and Micron.
In Huang Lichong's view, this indicates that economies of scale, yield improvements, lean production, and product mix upgrades are taking effect. The rapid expansion of high-margin DDR5 products is also a key factor in the profit improvement.
Screenshot of gross margin change analysis for main products
However, improved profitability does not mean ChangXin Technology can completely escape cyclical impacts.
The DRAM industry experiences severe price volatility, and companies face high fixed cost pressures. The prospectus shows that from 2023 to 2025, ChangXin Technology's fixed asset depreciation was 10.555 billion yuan, 14.875 billion yuan, and 24.68 billion yuan, respectively.
"Navigating cycles does not mean maintaining high profits every year, but rather losing less and avoiding severe financial bleeding during industry troughs, maintaining R&D continuity, and being able to release profits faster than in the previous cycle during recovery." Huang Lichong stated.
Crossing "From Zero to One," Gaps Remain with Samsung and Micron
The prospectus shows ChangXin Technology intends to raise 29.5 billion yuan through its Sci-Tech Innovation Board IPO. Of this, 7.5 billion yuan is for wafer manufacturing mass production line technology upgrades, 13 billion yuan for DRAM technology upgrades, and 9 billion yuan for forward-looking technology R&D.
This signifies that the listing is not merely a financing event but an important milestone for ChangXin Technology to further catch up with overseas giants.
Screenshot of ChangXin Technology's use of raised funds
At the July 15 investor exchange meeting, Chairman Zhu Yiming stated that ChangXin Technology's production capacity scale already ranks first in China and fourth globally, with three 12-inch DRAM wafer fabs in Hefei and Beijing. As DDR5 and LPDDR5/5X products accelerate penetration into downstream markets, coupled with the continuous development of servers, mobile devices, personal computers, smart cars, and other diverse application scenarios, DRAM market demand continues to grow, giving the fundraising projects favorable development prospects.
But looking at the global market, ChangXin Technology remains in a catch-up phase.
Data shows that in Q4 2025, ChangXin Technology's share of global DRAM sales revenue was approximately 7.67%, while Samsung, SK Hynix, and Micron held 33.96%, 34.48%, and 23.41%, respectively.
Guolian Minsheng Securities believes that through its planned 29.5 billion yuan IPO for large-scale capacity expansion, there is a significant gap between ChangXin's current capacity scale and overseas giants. Its existing capacity is nearly fully utilized. With multi-base layout advancement in the medium to long term, Semianalysis predicts the company's global market share will reach 17% by 2028. Compared to the capacity scale of overseas majors, ChangXin has substantial room for subsequent capacity expansion.
Huang Lichong also pointed out that ChangXin Technology has crossed the "from zero to one" stage for domestic DRAM, but gaps remain compared to becoming a global leader. "Having technology without yield cannot generate commercial profit; having capacity with excessively high costs leads to massive losses during industry downturns."
In Huang Lichong's view, the most critical capability ChangXin needs to build in the next phase is the ability for large-scale, stable mass production using advanced processes, primarily reflected in yield and cost-per-bit (the cost required to produce 1 bit of data storage capacity). Simultaneously, ChangXin needs to enhance its high-end product portfolio, global customer resources, and advanced packaging capabilities.
Driven by AI, Need to Demonstrate High-End Competitive Capability
"Market share growth is not the sole goal; more importantly, market share growth must be accompanied by technological generation advancement." Huang Lichong stated.
With the rapid development of the AI industry, memory chips are becoming a new competitive focal point.
AI servers place higher demands on memory capacity, bandwidth, and low-power capabilities, driving demand growth for DDR5, high-performance memory, and related storage products. For memory companies, AI not only brings incremental demand but is also reshaping the industry's competitive landscape.
Indeed, overseas memory giants have been strategically deploying in the AI market through high-value-added products like HBM in recent years to mitigate impacts from traditional DRAM cycle fluctuations.
In contrast, ChangXin Technology is in a stage of breaking into the high-end memory market. The prospectus shows that currently, the proportion of its AI-related revenue remains relatively low, and it has not disclosed that HBM has generated scale revenue. Huang Lichong believes that for the foreseeable future, ChangXin's growth will still mainly rely on the DDR4 to DDR5 upgrade, the LPDDR4X to LPDDR5/5X upgrade, and increases in domestic substitution rates.
"AI determines the industry's ceiling, while traditional DRAM upgrades, process yield, and cost capabilities determine whether ChangXin can truly climb to that ceiling." In Huang Lichong's view, ChangXin Technology needs to further enhance its high-end product competitiveness while maintaining its scale manufacturing advantage to gain greater market space.
"The AI wave has significantly widened the growth space of the memory industry and reshaped its growth logic." Also stated by Zhang Yi, CEO of iiMedia Consulting Group, ChangXin Technology needs to rely on a "dual-line strategy" of traditional DRAM iteration and AI high-end storage R&D in the future: in the short term, stabilizing its foundation and improving profit quality through DDR5 product mix upgrades; in the medium to long term, promoting the industrialization of high-value-added AI storage products like HBM, which will become an important direction for the company to further narrow the gap with international leaders.
This article is from the WeChat public account "Phoenix WEEKLY Finance," author: Wang Han, editor: Cui Lupeng
