Summary of the Conference Call for XGIMI Technology Company Overview - **Company**: XGIMI Technology - **Date of Call**: June 27, 2025 Key Points Industry and Market Performance - **Gross Margin**: Domestic market gross margin is approximately 30%, while overseas market gross margin has recently approached 45% [2][4] - **Market Demand**: Domestic market demand is under pressure, but profit margins are improving, and scale remains stable. Overseas markets continue to grow, with Europe generating revenue of 600 million RMB last year, growing over 40%, and the US market nearing 200 million RMB with similar growth rates [2][6] - **Japan Market**: The Japanese market has been a drag on overall overseas growth due to channel adjustments [2][6] Product Lines and Financials - **Home Products**: - Entry-level Play and Z series products have a gross margin close to 30% in the domestic market. Mid-to-high-end products like RS20 Ultra can achieve gross margins of 35% to 40% [3] - The gross margin for the K6 series has improved from about 10% to around 30% due to a 40% drop in TI DLP chip prices and design iterations [5] - **Vehicle Business**: - Focused on smart cockpits and smart headlights, with expected revenue contribution of 300 to 400 million RMB this year. The business is in the investment phase, aiming for stable profitability at around 1 billion RMB in revenue [7][16] - **Commercial Projection Business**: - Production began at the end of June, with shipments starting in July. The goal is to capture 10%-20% of the 10 billion RMB domestic commercial market [8][9] - Expected revenue of tens of millions RMB this year with a gross margin of 40%-50% [8] Strategic Developments - **LCOS Solution**: Collaboration with HiSilicon on LCOS solutions is ongoing, with potential mass production in Q4. This could disrupt TI's chip monopoly [3][10][11] - **North American Market**: Facing a 37.5% tariff on exports, the company plans to establish a factory in Vietnam to support future exports to North America and Europe [18][19] Future Outlook - **Revenue and Profit Goals**: - The company aims for stable revenue in the domestic market while maintaining growth in overseas markets. The home business is expected to generate over 400 million RMB in profit [27] - The vehicle business is projected to reach breakeven next year and achieve stable profitability by the following year [16] - **Market Strategy**: - The company does not plan to engage in large-scale marketing or price competition but will focus on integrating the midstream supply chain to mitigate risks from declining terminal demand [24] Additional Insights - **Sales Performance**: The suspension of national home appliance subsidies has had a limited impact on sales, primarily affecting product structure rather than overall sales volume [10] - **Product Mix**: The Play and Z series account for over 60% of total sales, with the Play series alone contributing over 30% [29] - **Dividend Plans**: The company plans to issue dividends this year, maintaining a historical payout ratio of around 50% [30]

Core Insights - The article emphasizes the increasing importance of rare earth elements (REEs) in various industries, highlighting their critical role in technology and military applications [1][3][35] - The Chinese government is intensifying scrutiny of rare earth enterprises, indicating a strategic shift towards protecting and controlling rare earth resources [21][29][30] Industry Importance - Rare earth elements are essential in modern technology, including smartphones, computers, and military equipment, making them more valuable than traditional resources like oil [5][7][13] - The extraction and refining of rare earth elements require advanced technology, which China has developed to a high level, achieving 90% refining capability [19][21] Technological Control - The complexity of rare earth refining technology has led to significant investments and research efforts, with past failures highlighting the challenges in the industry [17][19] - China’s control over rare earth refining technology positions it as a key player in global supply chains, giving it leverage in international trade and geopolitical matters [21][32] Security and Regulation - The Chinese government is implementing strict measures to monitor personnel involved in rare earth technology to prevent leaks and maintain national security [29][30] - Recent incidents of technology leaks have prompted the government to take action, reinforcing the importance of safeguarding rare earth technology [25][27] Global Implications - The article suggests that rare earth elements have become a strategic asset for China, comparable to a weapon in geopolitical negotiations [35][39] - Other countries, particularly in the West, are increasingly concerned about their dependence on Chinese rare earth supplies, indicating a potential shift in global economic dynamics [34][41]

Core Viewpoint - Xiaomi is set to launch its first SUV, the YU7, at the end of June, alongside other significant products, indicating a strong push into the automotive sector and continued growth in its technology offerings [7][10][14]. Group 1: Product Launches - The Xiaomi YU7, the company's first SUV, will be officially released at the end of June and is expected to be available in July, generating significant market interest [7][10]. - The Xiaomi MIX Flip 2, a new foldable smartphone, is anticipated to be unveiled this week, featuring a Leica imaging system and the new Surge OS, with a focus on high-end specifications [3][5]. Group 2: Product Specifications - The YU7 will feature standard configurations including laser radar, 800V fast charging, and long battery life, with dimensions of 4999x1996x1600 mm and a wheelbase of 3000 mm [10][14]. - The MIX Flip 2 will be powered by the Snapdragon 8 Gen 2 platform, boasting features such as IPX8 water resistance, 50W wireless fast charging, and a battery capacity exceeding 5000mAh [5][3]. Group 3: Market Performance - Xiaomi's stock price has increased by approximately 57% this year, marking three consecutive years of growth, reflecting investor confidence in the company's expanding product lineup [15][17]. - Analysts predict that the YU7's monthly sales could reach between 30,000 to 40,000 units, potentially surpassing the sales of the SU7 model [14]. Group 4: Technological Advancements - Xiaomi is focusing on operating systems and chip development, with the new HyperOS 3 set to launch in September, and the introduction of the 3nm chip, marking a significant milestone in China's semiconductor industry [16][17].

Core Viewpoint - The article discusses the escalating trade and technology conflict between the U.S. and China, particularly focusing on the strategic importance of rare earth elements and semiconductors in this rivalry [3][4][6]. Group 1: U.S.-China Trade Conflict - Following the first round of tariffs imposed by the U.S. in April, China began restricting export licenses, leading to warnings from U.S. manufacturers about potential production halts [2]. - The U.S. was caught off guard by China's control over rare earth elements, which are crucial for various technologies, including electric motors and military applications [3][5]. Group 2: Semiconductor Industry and Investments - Since mid-2019, leading Chinese chip manufacturers have invested $33.5 billion in capital expenditures and $4 billion in R&D, while Huawei reportedly spends approximately 180 billion yuan annually on R&D [4]. - The U.S. has invested only $439 million since early 2020 to establish a rare earth supply chain, highlighting a significant disparity in investment compared to China's extensive funding in the semiconductor sector [5]. Group 3: Future Implications and Military Concerns - The article suggests that the advancements in rare earth magnets could revolutionize mechanical power, making devices smaller, stronger, and more efficient, which could impact future warfare strategies [5]. - There are concerns that the U.S. military may find itself lacking critical minerals and batteries needed to counteract drone threats in future conflicts, emphasizing the risks of relying on foreign supply chains [6].

Core Insights - Ren Zhengfei, at nearly 80 years old, continues to demonstrate remarkable strategic vision and intellectual vitality, focusing on long-term technological advancements rather than short-term profits [2][3] - He emphasizes the importance of foundational research, allocating 60 billion yuan of Huawei's annual 180 billion yuan R&D budget to basic research without performance assessments, showcasing a rare commitment to long-term strategy in the tech industry [2] - Ren advocates for open collaboration and innovation, opposing isolationist approaches, and promoting Huawei's "onion-style open-source" strategy for its HarmonyOS to protect core technologies while expanding its ecosystem [2] Strategic Philosophy - Ren's management philosophy centers on focusing on core competencies, stating that Huawei has consistently targeted specific technological areas without chasing fleeting trends [3] - He warns against the pitfalls of a speculative economy, advocating for patience and sustained effort in achieving technological breakthroughs, contrasting with the prevalent short-term mindset in society [4] - Ren believes that national strategy should guide infrastructure development and talent cultivation, rather than relying solely on market forces, reflecting a deep understanding of the interplay between business and national progress [4] Learning and Adaptation - Continuous learning is a cornerstone of Ren's approach, as he engages with various fields including technology, economics, and philosophy, even personally studying mathematical algorithms [4] - His strategic patience is evident in his belief that "slow is fast," indicating a willingness to invest in long-term goals rather than immediate gains [4] - Ren's perspective transcends Huawei, positioning him as a significant figure in the broader context of China's technological and industrial development, serving as a model for future generations [4]

昨晚，小鹏G7全球首发，新车一大卖点即搭载3颗小鹏自研的图灵AI芯片。但在前一日的6月10日 20:40，微博名为"xp-小宇宙"的博主爆料，"震惊了！活动现场的图灵芯片被人盗走了！正在查监控！" 这个员工内部自曝吸引了不少网友围观。要知道对于芯片这样的核心技术，"被偷"事关重大。 很快有媒体注意到了这条微博并不寻常。功夫汽车公开质疑此举是否又是无底线的炒作？ 如此重要的芯片如果真的被偷，是否会造成严重的技术泄密？员工还有心情发微博，并且带着"何 小鹏回应g7将搭载3颗图灵芯片"和"小鹏g7将于6月11日全球首秀"两个tag，看起来其宣传的需求远大于 要找回芯片的紧迫感。 上海一家律师事务所高级合伙人告诉中国经济网记者，微博发布者表达"芯片被人偷走了！正在查 监控！"，是不是真的查监控是关键。如果没有查监控或者并不存在被盗窃的事实，基于微博是一个商 业化社交媒体平台，其内容带有商业宣传的性质，如果宣传与实际情况不符，其微博发布信息的行为可 能会导致公司存在涉及虚假宣传的可能性。 中国经济网向小鹏汽车公关部相关负责人求证芯片是否真的被偷，对方回应含糊其辞，说："那天 不见了，后面没再问。"记者进一步询问："被偷 ...

Core Viewpoint - The dialogue with Huawei's CEO Ren Zhengfei highlights the challenges and opportunities in China's semiconductor industry, emphasizing the need for continuous improvement and innovation despite existing difficulties [2][3]. Group 1: Company Insights - Huawei is recognized as one of many companies in China making progress in chip development, but Ren Zhengfei believes that the company has not yet reached the level of excellence perceived by the U.S. [2]. - Ren acknowledges that Huawei is currently one generation behind the U.S. in single-chip technology, but the company is leveraging mathematical approaches to compensate for physical limitations [2]. - The introduction of the Ascend 384 SuperNode, which consists of 12 computing cabinets and 4 bus cabinets, represents the largest scale supernode in the industry, capable of expanding into a supercluster with thousands of cards [3]. Group 2: Industry Context - Ren emphasizes that the semiconductor industry in China has numerous companies striving for advancement, particularly in compound semiconductors, which present significant opportunities [2]. - The Ascend supernode technology, launched at the Kunpeng Ascend Developer Conference, showcases Huawei's capability to achieve three times the training performance compared to traditional nodes [5]. - Ren also points out that the development of hundreds or thousands of operating systems in China will support advancements across various sectors, including industry, agriculture, and healthcare [2].

近日，在深圳华为总部，围绕大众关心的一些热点话题，人民日报记者一行与华为首席执行官任正非面 对面交流。昇腾芯片被"警告"使用风险，对华为有什么影响吗？任正非表示，中国做芯片的公司很多， 许多都做得不错，华为是其中一家。美国是夸大了华为的成绩，华为还没有这么厉害。要努力做才能达 到他们的评价。我们单芯片还是落后美国一代，我们用数学补物理、非摩尔补摩尔，用群计算补单芯 片，在结果上也能达到实用状况。(人民日报) ...

Core Viewpoint - The article discusses the advancements and challenges in lithography technology, particularly in the semiconductor industry, highlighting the need for innovative solutions to meet the growing demand for high-performance, low-energy, and scalable manufacturing processes [2][6][7]. Group 1: Industry Developments - The ability to manufacture nanoscale components is crucial for producing high-performance devices and driving technological advancements across various industries [2]. - Significant investments are being made in semiconductor research, with the U.S. government committing $280 billion through the CHIPS and Science Act, and the EU proposing $50 billion to double its chip production by 2023 [2]. - Taiwan Semiconductor Manufacturing Company plans to invest $33 billion by 2025 to keep pace with Moore's Law by entering new microchip markets [2]. Group 2: Lithography Technology Overview - Lithography is a manufacturing technique that creates patterned structures on substrates, with common methods including photolithography and electron beam lithography [3]. - Traditional lithography methods face challenges related to resolution, position control, and throughput, necessitating the development of new techniques to meet commercial application demands [3][7]. - Emerging lithography technologies are being developed to overcome the limitations of traditional methods, focusing on flexibility, scalability, and cost-effectiveness [6][7]. Group 3: Emerging Lithography Techniques - Various new lithography techniques are summarized, including: - **Nanoimprint Lithography**: High throughput and low cost, but may face issues with pattern replication [8]. - **Two-Photon Lithography**: Capable of generating smaller structures but has high time costs for large structures [8]. - **Block Copolymer Lithography**: Low cost but limited by the periodicity of microdomains [8]. - Each emerging technique has its advantages and disadvantages, with potential applications in various fields, including electronics and biomedicine [8][9]. Group 4: Upcoming Industry Events - The 2025 TrendBank (Fifth) Lithography Materials Industry Conference will be held from July 8-10 in Hefei, focusing on new applications, trends, and in-depth discussions on the lithography materials supply chain [11].

Group 1 - The core viewpoint of the article highlights the ongoing technological competition between China and the United States, with China making significant advancements in technology while the U.S. continues to impose sanctions, which are proving ineffective [1][3][4] - China's achievements in technology, such as the development of 3nm chips and domestic operating systems, are contrasted with the U.S. government's failure to contain China's technological growth through sanctions [1][4] - The U.S. government's recognition of the failure of its containment policy has led to the proposal of new sanctions, which are seen as discriminatory and aimed at hindering other countries' technological development [3][4] Group 2 - American companies, including Nvidia, express concerns over the high costs of U.S. export controls to China, with Nvidia estimating a loss of $15 billion due to these restrictions [4] - The article notes that despite past setbacks, Chinese companies have successfully developed a fully autonomous computer operating system and are expected to ship over 700,000 Ascend chips this year [4][6] - The article emphasizes that the U.S. attempts to monopolize AI leadership globally are met with resistance, as China offers alternative choices in advanced chips and operating systems, promoting a diversified technological future [11]