Core-Tech Abandons A-Share Listing for H-Share: Riding the Price Surge Trend, or Placing a High-Stakes Wager on the Industry Cycle?
Its market share is only 1.3%
The price surge of memory chips is still ongoing. Against this backdrop, a chip company that once failed to list on the A-share market is trying to ride the trend to get access to the Hong Kong Stock Exchange.
Recently, the day after the first version of its Hong Kong IPO prospectus became invalid, Xtx Technology Co., Ltd. (hereinafter referred to as "Xtx Technology") submitted its application for listing on the Main Board of the Hong Kong Stock Exchange again.
This "seamless" second sprint stands in sharp contrast to its A-share listing journey. In November 2022, after Xtx Technology passed the IPO review at the ChiNext board, it failed to enter the registration process for a long time, and finally voluntarily withdrew its application in December 2023.
The listing road has experienced many twists and turns, and this time Xtx Technology is impacting the Hong Kong stock market with a quarterly report showing "explosive growth".
In the first quarter of 2026, Xtx Technology's revenue increased by 77.4% year-on-year to RMB 224 million, recording a net profit of RMB 75.89 million, nearly 3 times the full-year net profit of 2025, and its gross profit margin rose by 41.27 percentage points year-on-year to 55.63%.
With the upward industry cycle and supply contraction driving up prices, has Xtx Technology finally got the best listing window?
01 Fifth in the Industry, With a Market Share of Only 1.3%
As a chip company that takes code-type flash memory as its absolute main business, Xtx Technology has developed three major product lines: NOR Flash, SLC NAND and MCP, of which NOR Flash and SLC NAND together contribute more than 90% of the revenue, forming the absolute core foundation of the company.
These chips are mainly used to store the boot code and firmware of storage devices, and their end applications cover communication base stations, industrial controllers, automotive ECUs, smart homes and other fields.
Calculated based on the revenue in 2025, Xtx Technology ranks fifth among the global fabless code-type flash memory enterprises, with SLC NAND ranking fourth and NOR Flash ranking fifth.
However, the gold content of this "top five in the industry" is limited. The market shares of Xtx Technology in the SLC NAND and NOR Flash sub-tracks are 2.4% and 0.7% respectively. In the same period, the combined share of the top two manufacturers in the two major fields is about 40%, and the trend of head concentration is obvious.
In addition, it cannot be ignored that the market capacity of code-type flash memory itself is small, and the industry pattern is highly concentrated, leaving limited room for Xtx Technology to negotiate prices.
In 2025, the global flash memory chip market reached USD 74.5 billion, of which code-type flash memory only accounted for USD 5.1 billion, less than one-tenth of data-type flash memory. With a market share of 1.3%, Xtx Technology ranks 11th in the entire global flash memory chip market, and the combined CR5 of the industry is about 67.9%.
The deeper constraint comes from its dependence on upstream suppliers. The prospectus reveals that as a fabless enterprise, Xtx Technology's wafer manufacturing, packaging and testing links all rely on outsourcing. From the perspective of cost structure, wafer procurement accounts for more than 80% of the sales cost all year round.
The concentration is also at a high level. From 2023 to 2025, the proportion of Xtx Technology's purchases from the top five suppliers increased from 75.4% to 81.6% in total, with extremely high concentration. It further rose to 86.8% in the first quarter of 2026, of which the largest supplier alone accounted for 51.9%.
The passive disadvantages in the upstream and downstream have amplified the impact of the industry cycle on the company.
Xtx Technology admitted in its prospectus that the flash memory chip industry usually cycles every three to four years. After experiencing the downturn from 2020 to 2023, the industry rebounded strongly in 2024, with the market size increasing by 67% year-on-year to USD 68.4 billion.
However, the recovery pace of Xtx Technology lagged behind the industry, and it did not start to rebound until 2025.
From 2023 to 2025, the company's revenue was RMB 663 million, RMB 442 million and RMB 519 million respectively, and the net profit attributable to shareholders was RMB -14.0261 million, RMB -37.136 million and RMB 27.216 million respectively.
In response, Xtx Technology explained in its prospectus that it was a "temporary operational lag", which points to a specific action behind it: strategic stockpiling.
02 Stockpiling Pays Off, A High-stakes Bet on the Cycle
From 2023 to 2025, Xtx Technology's inventory was RMB 363 million, RMB 318 million and RMB 294 million respectively, which seemed to be effectively cleared, but the inventory turnover days were 215 days, 327 days and 279 days respectively.
The turnover days rose first and then fell, which also confirmed from the side that the low-priced inventory in 2024 had not been effectively realized, and it was gradually released until 2025.
In the first quarter of 2026, Xtx Technology's inventory jumped to RMB 424 million again, a year-on-year increase of 44.3%, accounting for 48.6% of the total assets, and the turnover days extended to 330 days. From the perspective of inventory structure, nearly 70% are raw materials and work-in-progress.
In 2026, Xtx Technology increased its stock preparation again, betting that the price rise trend will continue. In the first quarter of 2026, the selling prices of Xtx Technology's core product lines rose sharply across the board, and its strategy was initially verified.
Among them, the average price of SLC NAND products, which contribute nearly 70% of the revenue, increased by 235.22% year-on-year to RMB 13.04. Even when the sales volume dropped by 34.39% year-on-year, the revenue of this segment still achieved a year-on-year surge of 119.12%, and the gross profit margin jumped from 14.2% to 67.5%.
At the same time, the average price of NOR Flash products increased by 21.67% year-on-year to RMB 0.73, and the average price of MCP products increased by 70.01% year-on-year to RMB 29.02.
With all product lines raising prices, Xtx Technology's comprehensive gross profit margin in the first quarter of 2026 surged by 41.27 percentage points year-on-year to 55.63%.
However, the other side of the explosive performance growth is the unsustainability of the upward cycle.
From the perspective of a three-to-four-year cycle, this round of rebound that started in 2024 has lasted for two years. As of the end of the first quarter of 2026, it takes an average of 11 months for Xtx Technology's inventory to move from warehousing to outbound. Once the cycle inflection point comes, this batch of high-priced inventory will change from profit reserve to cost burden.
The cyclical fluctuation of inventory value has already left traces in the financial data. From 2023 to the first quarter of 2026, Xtx Technology has accrued a total of about RMB 81.7 million for inventory write-downs.
This historical burden has also added variables to this Hong Kong IPO. In 2022, Xtx Technology underestimated the downward speed of the cycle, leading to a huge difference between its A-share performance forecast and the actual results, receiving a written warning from the Shenzhen Stock Exchange, and finally withdrew its ChiNext IPO application.
This time, after switching to the Hong Kong stock market, the Stock Exchange of Hong Kong requires the disclosure of historical information disclosure violations, and the China Securities Regulatory Commission's filing review also requires the supplement of equity compliance matters. The cycle risk not only blocked its A-share listing in the past, but is still a compliance threshold that the company must cross.
03 When the Tide Recedes
The other side of the high-stakes bet on the cycle is that stockpiling consumes a large amount of cash.
In the first quarter of 2026, although Xtx Technology's profit surged, the net cash flow from operating activities turned negative, reaching RMB -45.426 million, which was mainly caused by large-scale stockpiling.
In addition, the payment collection rhythm of sales channels is also affecting cash return.
In the first quarter of 2026, the distributor channel contributed 88.1% of Xtx Technology's revenue, and the gross profit margin of the channel exceeded the direct sales channel for the first time, rising by 12.7 percentage points year-on-year to 56.2%, which has become the core foundation of the company.
The pressure of payment collection has also increased synchronously. As of the end of March 2026, trade receivables increased from RMB 72.4 million at the end of 2025 to RMB 103 million, and the turnover days extended from 45 days to 57 days.
As of the end of March 2026, Xtx Technology's cash and cash equivalents were RMB 149 million, which could still cover its RMB 87.392 million short-term loans and RMB 53.7 million long-term loans. However, if the inventory clearance fails to meet expectations and the payment collection continues to slow down in the future, the buffer space of the capital chain will gradually narrow.
Xtx Technology also warned in its prospectus that net cash outflow from operating activities may continue to occur. In the purpose of this IPO fundraising, supplementing working capital is listed as one of the four core projects.
Under the pressure of the capital chain, Xtx Technology maintained large-scale dividends during the loss period.
In 2024, against the background of declining revenue and expanding losses, Xtx Technology distributed RMB 30.9 million in dividends to shareholders; after turning losses into profits in 2025, it distributed another RMB 20.6 million in dividends, with a total dividend of more than RMB 51.5 million in two years.
While distributing generous dividends, it raises funds to supplement liquidity. The rationality of Xtx Technology's capital planning has raised doubts. What makes the market more worried is that early shareholders and actual controllers are intensively reducing their holdings on the eve of the IPO.
From August to November 2025, Shanghai State Investment, which held shares for seven years, transferred all its shares in four transactions, cashing out about RMB 150 million; three companies under the Shenzhen Venture Capital Group also reduced their positions, cashing out a total of about RMB 59.9 million; Long Dongqing, the actual controller, transferred 1.6 million shares, cashing out RMB 25.6 million; initial shareholder Shen Yue transferred 925,900 shares, cashing out about RMB 15 million.
While shareholders vote with their feet, the regulatory scrutiny has also come. In June 2026, in the feedback on overseas listing filing, the China Securities Regulatory Commission required Xtx Technology to supplement and explain the pricing basis of previous capital increases and equity transfers, and whether there are abnormal share subscription prices and interest transfer situations.
With shareholders cashing out and leaving, and regulators inquiring about pricing, on Xtx Technology's IPO journey, the question to be answered is never just whether the industry has recovered, but whether it can stand on its own when this round of price surge recedes.
This article is from the WeChat Official Account "Insight IPO" (ID: dongcha-ipo), written by Pan Yan, edited by Wei Fanxi, and published with authorization from 36Kr.