1. Company Main Business and Product Structure

Xingchen Technology is a global leader in edge AI SoC chip design, focusing on three core areas: smart security, smart IoT, and smart automotive, forming a technology closed loop of “vision + AI” and “perception + computation.” The company’s revenue structure for 2024 is: smart security accounts for 68.81% (1.588 billion yuan), smart IoT accounts for 20.58% (475 million yuan), and smart automotive accounts for 10.61% (245 million yuan).

1. Core Products of Smart Security Chips: Covering a full range of chips including network cameras (IPC) and network video recorders (NVR), the global market share for IPC SoC in 2024 is expected to reach 36.5%, and NVR SoC market share is 38.7%, both ranking first in the world.Technological Breakthroughs: The self-developed ISP4.0 image processing engine supports 12M dual-channel shooting and 4K@30fps video encoding, with a dynamic range increase of 40%, and integrates 3A (auto-focus / exposure / white balance), HDR/WDR technology, leading the industry in strong light suppression and low-light noise control capabilities.Application Scenarios: Serving major clients such as Hikvision and Dahua, products are exported to over 160 countries, with overseas revenue increasing to 35%.
2. Smart IoT Chip for Intelligent Robots: In 2024, shipments and revenue are expected to grow by over 300% year-on-year, with Q1 2025 shipments already exceeding the total for 2024, covering major brands such as Ecovacs and Roborock.Smart Home: The SSD201/SSD202 series chips support scenarios such as smart locks and smart lighting, with smart IoT business revenue expected to grow by 38.61% year-on-year in 2024, becoming the fastest-growing business line.3D Perception Layout: By acquiring 3D ToF technology, the iToF series products are launched for robots, while the dToF series products are being developed for automotive LiDAR, with mass production expected in 2026.
3. Smart Automotive Chip in the ADAS Field: Focusing on L0-L2 level assisted driving, products support functions such as adaptive cruise control (ACC) and lane keeping assist (LKA), with smart automotive business revenue expected to grow by 31.01% year-on-year in 2024, and the proportion of pre-installed market orders increasing to 40%.Automotive Grade Breakthrough: Automotive-grade chips have passed AEC-Q100 Grade 2 certification, with a temperature range of -40℃ to 105℃, and have entered the supply chains of BYD and XPeng.

2. Financial Performance for 2024 and 2025

1. 2024 Core Data Revenue and Profit: Achieving an annual operating revenue of 2.354 billion yuan, a year-on-year increase of 16.49%; net profit attributable to the parent company is 256 million yuan, a year-on-year increase of 25.18%. The net profit excluding non-recurring items is 181 million yuan, with a slight increase of 0.42% year-on-year, mainly due to non-recurring gains and losses (government subsidies + financial asset income) reaching 75.31 million yuan.Profitability: Gross margin is 35.79%, a slight decrease of 0.67% year-on-year, mainly due to intensified price competition in smart security; R&D investment is 602 million yuan, a year-on-year increase of 21.95%, accounting for 25.59% of revenue, with a focus on AI processors and 3D perception.Cash Flow: Net cash flow from operating activities is 419 million yuan, a year-on-year decrease of 3.62%; cash balance is 980 million yuan, with a debt-to-asset ratio of 31%, indicating a stable financial structure.
2. 2025 Performance Outlook Revenue Forecast: Benefiting from the growth of smart robots, AI glasses, and automotive chips, revenue is expected to grow by 23.27% to 2.9 billion yuan in 2025, with smart IoT business growth expected to exceed 40%.Profit Forecast: Gross margin is expected to rebound to 36%, combined with optimized expense control, net profit attributable to the parent company is expected to reach 300 million yuan (a year-on-year increase of 17.34%), corresponding to a PE ratio of about 75 times.

3. Investment Highlights and Hot Topics

1. Core Target for Domestic Replacement of AI Glasses Chips: The company has launched the world’s first chip specifically designed for smart glasses, the SSC309QL, which uses Chiplet packaging technology, reducing the area by 24% compared to competitors and lowering power consumption by 50% (600mW). It supports 1.5TOPS computing power for local AI inference, enabling functions such as reading assistance and motion capture, with customer terminal products expected to enter mass production in the second half of 2025. The next generation of advanced process chips (5nm) has begun development, aiming for tape-out in the second half of 2025, targeting high-end scenarios such as AR navigation and instant translation.
2. Explosion in the Smart Robot Chip Track: In 2024, shipments of smart robot chips are expected to exceed 3 million units, with Q1 2025 shipments already surpassing the total for 2024, covering major brands such as Ecovacs and Roborock. The company’s new generation SSU9386 chip integrates multi-sensor fusion technology, supporting robotic arm control, with mass production expected in 2026, targeting a 20% market share.
3. Seizing Opportunities in Automotive LiDAR Chip Market: The dToF chip developed by the company’s 3D perception business line adopts SPAD-SoC architecture, supporting long-distance ranging up to 300 meters with centimeter-level accuracy. Collaborations with Hesai and RoboSense are in progress, with mass production expected after passing automotive certification in 2026, targeting a 15% market share in the automotive LiDAR chip market.

4. Core Business Competitive Advantages and Growth Potential

1. Smart Security: Dual Advantages of Technical Barriers and Market Position: The ISP4.0 image processing engine supports I-ISP (intelligent image signal processing), optimizing the efficiency of Transformer large models at the edge, with image quality parameters (SNR, dynamic range) comparable to international giants such as Sony and Ambarella.Market Position: The global market share for IPC/NVR SoC is first, with a 51.8% market share for USB video conferencing camera chips, and a customer repurchase rate exceeding 90%.Growth Drivers: The target for overseas market revenue is expected to increase to 40% by 2025, with security demand driven by low-orbit satellite internet construction expected to grow by 25%.
2. Smart IoT: Multi-Scenario Penetration and Technical Synergy: The ISP and AI algorithms accumulated in the security field are being migrated to robotics and smart home scenarios. The SSU9383 chip integrates motion ISP, supporting stabilization for drones and action cameras, with costs 15% lower than competitors.Growth Potential: The target revenue for the smart IoT business in 2025 is 700 million yuan (up 47% year-on-year), with over 60% of the revenue coming from robot chips and 3D perception chips contributing additional growth.
3. Smart Automotive: Automotive Certification and Pre-Installed Breakthroughs: The chips have passed 100,000 hours of reliability testing, with radiation resistance reaching 1×10⁹ Gy, and have entered the supply chains of BYD and XPeng, with a target of 1 million units shipped for automotive chips in 2025.Market Space: The domestic automotive vision chip market is expected to reach 8 billion yuan by 2025, with the company expected to capture 12% of the market share (approximately 960 million yuan) due to its technological advantages.

5. In-Depth Analysis of AI Glasses Chip Cooperation

1. Progress of Cooperation with ByteDance: The AI glasses chip SSC309QL customized for ByteDance has completed tape-out, with customer terminal products expected to be launched in the second half of 2025. This chip uses Chiplet packaging + built-in LPDDR4x design, compressing width by 20%, adapting to glasses frames, and supporting 4K video recording and local AI inference, with power consumption reduced by 50% compared to competitors. The cooperation focuses onAR interaction, motion recording, and instant translation in three major scenarios, aiming for a shipment of 500,000 units by 2025.
2. Technical Advantages and Industry Position: Low Power Design: Dynamic voltage adjustment technology achieves a power consumption of only 300mW for 2M recording, paired with a 150mAh battery for 15 hours of continuous use, leading the industry in battery life.Computing Power and Ecosystem: 1.5TOPS computing power supports local operation of lightweight large models (such as 1B parameters) and can seamlessly connect with ByteDance’s “Doubao” large model for real-time translation and scene recognition functions.Industry Position: The SSC309QL is the first AI glasses chip in China to pass TÜV Rheinland’s low blue light certification, with technical parameters comparable to Qualcomm’s AR1 Gen1, and costs reduced by 30%.
3. Market Space and Growth Potential: The global AI glasses market is expected to reach approximately $50 million in 2024, projected to grow to $120 million by 2031 (CAGR 14.3%), with China’s market share expected to increase from 30% in 2024 to 45% in 2031. With technological advantages and partnerships with leading customers, the company expects to capture 10% of the global market share by 2025 and increase to 25% by 2030, becoming the second-largest supplier after Qualcomm.

6. Risk Warnings

1. Technology Iteration Risk: The AI glasses chip needs to continuously follow up on process technology (such as 5nm), and delays in R&D progress may lead to a loss of market share.
2. Customer Concentration Risk: The top five customers account for over 40% of revenue, and fluctuations in major customer orders may affect performance stability.
3. Raw Material Price Fluctuations: Wafer foundry costs account for over 70%, and price increases from foundries such as TSMC and SMIC may compress gross margins.

7. Conclusion

Xingchen Technology, as a global leader in the “vision + AI” chip field, occupies a core position in smart security, robotics, automotive, and AI glasses sectors. In the short term, the growth of smart robots and automotive chips will support performance; in the medium to long term, the cooperation on AI glasses chips with ByteDance and breakthroughs in 3D perception technology are expected to open a second growth curve. Attention should be paid to the mass production progress of SSC309QL, the results of automotive certification for 3D perception chips, and the landing of smart robot orders.