Creality 3D is gearing up for a Hong Kong IPO. Its shipment volume last year was less than 60% of that of Totem 3D | IPO Observation

Author | Zhang Ziyi

Editor | Peng Xiaoqiu

Currently, when most hardware companies going global talk about their competitors, they can't avoid Chinese companies. Overseas competitors are no longer a big concern. What really scares them are the waves of hardware companies from China. They are both highly competitive within the industry and hard - working. They have the advantage of a common supply chain and a continuous stream of new technologies.

Creality must have a very profound understanding of this.

In 2014, the four partners of Creality met at an exhibition and decided to cooperate in developing 3D printers. Eleven years later, it is just one step away from listing in Hong Kong.

However, this path is no longer an exclusive stage for them. The new leader, Bambu Lab, is growing rapidly, and old players like Anycubic and Elegoo are lurking around.

Around 2015 was the period when the Chinese 3D printer industry developed most rapidly, and a large number of related enterprises emerged. In this year, Anycubic and Elegoo were established one after another.

After the 3D printing boom came the bubble - bursting period, leaving behind technology and the supply chain. Located in Shenzhen, Creality and Anycubic seized the foreign trade opportunities of coastal cities. In four or five years, they both became 3D printing enterprises with revenues exceeding 1 billion yuan.

A revenue of over 1 billion yuan is an outstanding achievement in the rather niche 3D printing track.

Until the new entrant, Bambu Lab, joined the market. In April 2022, Bambu Lab launched its first - generation 3D printer products and reshuffled the market with irresistible momentum. By 2024, market sources said that Bambu Lab's revenue had exceeded 5.5 billion yuan, while Creality's revenue at that time was 2.288 billion yuan.

The gap between the late - comer and the early - starter is getting wider and wider.

Fortunately, Creality is now leveraging its early - starter advantage and preparing for listing. It should be noted that the four founders of Creality, Chen Chun, Ao Danjun, Liu Huilin, and Tang Jingke, still hold equal shares. They hold 21.31%, 19.67%, 19.67%, and 21.31% respectively, which has planted many hidden worries.

Creality is very likely to become the first 3D printing listed company on the Hong Kong Stock Exchange, but it must answer a question: After becoming the first, then what?

01 Creality Becomes the "Largest in the World" in a Word Game

In the consumer - grade 3D printing field, the competitors of companies going global are Chinese companies, more precisely, Shenzhen companies.

The CONTEXT Q2 2024 report shows that in the global entry - level 3D printer market, four Shenzhen manufacturers, Creality, Bambu Lab, Anycubic, and Elegoo, together account for more than 90% of the global shipment volume.

The Matthew effect in the consumer - grade 3D printing industry is becoming more and more significant.

In the prospectus, the data cited by Creality shows that calculated by the cumulative shipment volume of consumer - grade 3D printers from 2020 to 2024, Creality is the world's largest provider of consumer - grade 3D printing products and services, with a cumulative shipment volume market share of 27.9%. Moreover, it is the only company among the major participants in the global 3D creative industry that simultaneously provides consumer - grade 3D printing, consumer - grade 3D scanning, and consumer - grade laser engraving products and services.

Image source: Creality's prospectus

However, the first - place result in cumulative shipment volume actually bypasses the giant, Bambu Lab. Judging from last year's shipment volume, Creality is no longer the first. Company B (Bambu Lab) shipped about 1.2 million units last year, with a market share of 29%. Creality shipped only 700,000 units last year, less than 60% of Bambu Lab's, with a market share of about 16.9%.

On the one hand, Bambu Lab's shipment volume far exceeds that of other domestic consumer - grade 3D printing companies. On the other hand, the gap between Creality and Anycubic and Elegoo is not large.

Creality stated in its prospectus that the sales volume of its 3D printers decreased from 870,000 units in 2023 to 720,000 units in 2024, mainly because it focused on promoting relatively high - end product lines, resulting in more targeted sales volume and a higher average selling price.

In fact, the proportion of Creality's 3D printer business has been decreasing in recent years. The prospectus shows that the revenue proportion of the 3D printer business reached 81.7% in 2022 and dropped to 61.9% in 2024.

Judging from the performance, Creality's revenue has slightly increased in the past three years, the gross profit margin has slightly improved, but the profit during the period has decreased.

In 2022, 2023, and 2024, Creality's operating revenues were 1.346 billion yuan, 1.883 billion yuan, and 2.288 billion yuan respectively; the profits during the period were 104 million yuan, 129 million yuan, and 88.66 million yuan respectively; and the gross profit margins were 28.8%, 31.8%, and 30.9% respectively.

In the face of fierce market competition, Creality is actually having difficulty maintaining its title of "the world's largest consumer - grade 3D printing company in terms of cumulative shipment volume", and being overtaken is almost just a matter of time.

Finding a new growth curve has become a must - do for Creality.

02 Betting on New Businesses with Equally Fierce Competition

In 2024, Creality became the world's largest consumer - grade 3D scanner company in terms of shipment volume and the world's third - largest consumer - grade laser engraving machine company.

It should be noted that the consumer - grade 3D scanners and consumer - grade laser engraving machines with high shipment volumes are all Chinese companies.

The market for consumer - grade 3D scanners is not large. It is regarded as the key entry point for the 3D creative industry, enabling ordinary users to carry out 3D creation, significantly lowering the threshold for digital creation, and helping users achieve high - precision modeling of object geometry and texture data without mastering complex modeling skills.

The prospectus shows that the global shipment volume of consumer - grade 3D scanners increased from 39,000 units in 2020 to 186,000 units in 2024, with a compound annual growth rate of 47.8%. Last year, the top three consumer - grade 3D scanner companies accounted for 83.5% of the global shipment volume and 79.9% of the total GMV, and Creality's market share was 37.7%.

Specifically in terms of revenue, Creality's 3D scanners contributed 208 million yuan in revenue in 2024, accounting for 9.1%, showing rapid growth. However, the actual revenue contribution is still less than that of the 3D printing consumables business.

Image source: Creality's prospectus

It is worth noting that the average selling price of Creality's 3D scanners decreased from 2,700 yuan in 2022 to 1,700 yuan in 2023. The company explained that in 2022, the 3D scanners were sold through crowdfunding, which usually charges a higher price. By 2023, most 3D scanners were sold through distributors at the distribution price.

The sharp drop in prices through different channels also shows that the product's price competitiveness is limited.

As for laser engraving machines, Creality also has a powerful competitor.

Laser engraving machines attracted attention two years ago because the annual revenue of the leading consumer - grade laser engraving machine company, xTool, exceeded 1 billion yuan.

Consumer - grade laser engraving machines are composed of a frame, guide rails, an electronic control system, and a laser module. The laser module integrates a laser, a cooling fan, and a focusing structure, which is the key component for completing engraving and cutting, and its cost accounts for about half of the overall equipment. From the supply side, the technical conditions of Chinese laser equipment products are relatively mature. Their iteration speed and product quality can match those of overseas giants, giving them a natural advantage in going global. From the demand side, European and American countries currently have the largest demand, and the Asia - Pacific region is the fastest - growing region. Its consumer group overlaps to some extent with the 3D printing consumer group, including geeks, small - B entrepreneurs, or handicraft enthusiasts.

The sudden rise of xTool has made many 3D printing companies, including Creality, re - examine this track.

The prospectus shows that laser cutting machines contributed 160 million yuan in revenue to Creality in 2024, accounting for 7.1%. Last year, the top five consumer - grade laser engraving machine companies accounted for 40.7% of the global shipment volume and 54.9% of the total GMV.

Zheshang Securities estimated that xTool's revenue in 2024 was 2 - 3 billion yuan, and it is expected to exceed 5 billion yuan in 2025.

In the laser engraving machine field, the Matthew effect is also significant, and the revenue gap between the first - place and third - place companies in terms of shipment volume is very large.

Creality's advantage lies in its years of accumulation at home and abroad, with a lot of precipitation in the supply chain and sales channels. Compared with some cross - border e - commerce companies that rely more on online channels, the proportion of the company's online and offline sales is basically similar.

Image source: Creality's prospectus

In the early years, Creality mainly supplied goods to large cross - border e - commerce sellers and engaged in foreign trade sales. After 2018, it began to pay attention to brand layout. The prospectus shows that in terms of sales channels, the company's sales network is mainly composed of online platforms and offline distribution. From 2022 to the first quarter of this year, the proportion of the company's online sales revenue has been continuously increasing, and the proportion of online revenue in Q1 reached 47.9%. Online sales channels include independent websites, overseas platforms such as Amazon and eBay, and domestic platforms such as Tmall, JD.com, and Taobao.

As of the first quarter of this year, Creality has 74 self - operated online stores and 2,163 distributors. Its sales network covers about 140 countries and regions around the world, and the number of its overseas online stores has increased from 6 at the end of 2022 to 58.

However, for the highly competitive hardware industry, although channels can help enterprises with sales, product strength is the key. The success of Bambu Lab and xTool has proved the importance of the latter.

Moreover, Creality's prospectus also shows that the proportion of the company's sales expenses to revenue increased from 8.1% in 2022 to 16.7% in 2024. Although the R & D investment has increased, the proportion has always been less than 7%.

However, for hardware companies that attach importance to product strength, the R & D proportion should be much higher than 7%.

Eleven years ago, at that exhibition that changed their fate, Liu Huilin, the co - founder of Creality, found that the price of consumer - grade 3D printers at the exhibition was 30,000 to 40,000 yuan. They saw a huge business opportunity here and made cheaper products, and have come this far.

The pandemic catalyzed the overseas 3D printing market. Creality has encountered a larger market and more fierce competition. In the turbulent waves, listing is just the beginning.