ASR Microelectronics Files for Hong Kong Listing After Swing to Profit

ASR Microelectronics submitted a listing application to the Hong Kong Stock Exchange on September 11, 2026, with Morgan Stanley and Haitong International as joint sponsors. The company is a platform-based fabless semiconductor company that has built an integrated technology platform supported by multi-standard cellular baseband technology, artificial intelligence computing technology and complex system-on-chip design capabilities. According to the prospectus, based on 2025 shipments, ASR Microelectronics ranked first in the global cellular connectivity chip market with a 37.8% share, and its shipment growth rate between 2023 and 2025 exceeded that of the other top five global peers. In the first half of 2026, the company achieved net profit attributable to shareholders of RMB 84.24 million, reversing a loss into profit.

The reporting periods are 2023, 2024, 2025 and the first half of 2026. During the reporting periods, sales to the company's top five customers accounted for 80.1%, 82.1%, 82.6% and 79.9% of total revenue in each period, respectively. Customer B is an unlisted electronic components distributor established in 2010 and headquartered in Shanghai, and remained the company's second-largest customer throughout the reporting periods. Sales to it amounted to RMB 425 million, RMB 722 million, RMB 848 million and RMB 462 million, representing 16.4%, 21.3%, 22.2% and 18.9% of total revenue in the same periods, respectively.

Customer B is also ASR Microelectronics' supplier G. In the first half of 2026, ASR Microelectronics purchased RMB 128 million of memory chips from supplier G, accounting for 5.6% of total purchases in the period, making supplier G directly the company's third-largest supplier. From 2023 to 2025, purchases from this entity were zero in each year. The company said the customer purchases its own-brand products and resells them to downstream customers, while also supplying memory chips to the company for use in certain chip products and reference designs; the sales and purchase terms with this counterparty are independently negotiated, the sales transactions and purchase transactions are independent of each other, there is no related-party relationship, and neither is premised on the other.

In the first half of 2026, ASR Microelectronics' gross margin rose to 28.5% from 21.4% in the same period of 2025, which the company attributed to an increased share of high-end products such as 5G and a decline in average unit cost. During the reporting periods, purchases from the company's top five suppliers accounted for 75%, 77.6%, 71.4% and 74.8% of total purchases in each period, respectively. Supplier A is a listed company established in 1987 and headquartered in Taiwan, China, specializing in integrated circuit manufacturing. During the reporting periods, purchases from supplier A accounted for 52.4%, 51.5%, 45.5% and 51.1%, respectively. Wafer costs are the largest component of the company's cost of sales, accounting for 71.6%, 68.8%, 69.8% and 70.4% of total cost of sales in each period. The company said it selected this supplier mainly based on its process technology, yield levels, production maturity and capacity for the advanced processes required by the company's products, and that it has worked with the supplier since 2017 and maintains a long-term relationship.

The company's prospectus said that if this supplier reduces supply due to capacity constraints, geopolitical factors or changes in commercial terms, the cost and time required for the company to find alternative capacity in the short term and complete product redesign and certification would pose a substantial challenge to business continuity. During the reporting periods, the company's research and development expenses reached RMB 1.116 billion, RMB 1.242 billion, RMB 1.299 billion and RMB 663 million, respectively. From 2023 to 2025, ASR Microelectronics recorded net losses of RMB 506 million, RMB 693 million and RMB 390 million, respectively. As of the end of June 2026, accumulated losses on the company's consolidated balance sheet reached RMB 5.015 billion. The company said future net profits must first be used to make up for accumulated losses and to set aside statutory reserves, and that before the relevant conditions are met, it cannot declare or pay cash dividends to shareholders.

During the reporting periods, ASR Microelectronics' net cash flow from operating activities was negative RMB 678 million, negative RMB 412 million, negative RMB 456 million and negative RMB 378 million, respectively. In the first half of 2026, despite recording a book profit of RMB 84.24 million, the company's net operating cash outflow expanded year on year. Its inventory rose from RMB 1.351 billion at the end of 2024 to RMB 2.155 billion at the end of June 2026, while trade receivables increased from RMB 309 million at the end of 2025 to RMB 456 million at the end of June 2026. As of the end of June 2026, the company's short-term borrowings stood at RMB 499 million.

Alibaba Network originally held a 12.43% stake in ASR Microelectronics. From August 17 to September 7, 2026, Alibaba Network reduced its holdings of the company's A-shares by 5.2831 million shares through centralized bidding and block trades; from September 8 to September 10, Alibaba Network continued to reduce its holdings by another 2.4827 million shares. During the above periods, Alibaba Network reduced its holdings by a total of about 7.7658 million shares, or about 1.86% of the company's total share capital, cashing out a total of about RMB 700 million, with its shareholding ratio falling from 12.43% to 10.58%. As of the filing, ASR Microelectronics' ownership structure is relatively dispersed, and the company's single largest shareholder group consists of chairman Dai Baojia and the shareholding platforms he controls, which together control 22.32% of the company's voting rights.