Core Viewpoint - Huada Jiutian (301269.SZ), a leading EDA company in China, has announced a partnership to establish Tianjin Zhongwan Xincheng Management Consulting Partnership, focusing on hardware-assisted verification in digital chip design, highlighting its strategic commitment to the digital chip verification field [1][4]. Group 1: Investment and Partnership - The total subscribed capital for the new partnership is set at 1.1001 billion yuan, with Huada Jiutian contributing 1 billion yuan for a 90.9008% stake, demonstrating its strong commitment to the digital chip verification sector [1]. - The partnership involves Guangdong Hengqin Yuemao Cooperation Zone Zhongjiwan Enterprise Management Co., Ltd. and Tianjin Binhai New Area Venture Capital Guidance Fund Co., Ltd. [1]. Group 2: Market Context and Strategic Importance - EDA is known as the "mother of chips," playing a crucial role throughout the chip design, manufacturing, and packaging processes, with hardware-assisted verification tools being essential for digital chip design [4]. - The complexity of AI chips and GPUs has led to the verification phase accounting for over 60% of the chip development cycle, making it a critical bottleneck in chip development [4]. - Huada Jiutian's investment aims to address this "key gap" in domestic EDA, focusing on leading companies in the hardware-assisted verification field [4]. Group 3: R&D and Competitive Positioning - In the first half of 2025, Huada Jiutian's R&D investment reached 365 million yuan, representing 72.84% of its revenue, resulting in the launch of 7 core tools and the development of 9 major solutions [4]. - The advanced packaging EDA platform can reduce the Chiplet design cycle by 60%, while the 3DIC physical verification platform fills a domestic gap, enhancing the company's tool coverage in the digital circuit process [4]. - The investment in hardware-assisted verification is expected to elevate the company's capabilities and narrow the gap with international giants in the EDA market [4][5].

Core Insights - The company reported a revenue of 303 million yuan in Q3 2025, a year-on-year increase of 1.16%, but the net profit attributable to shareholders decreased by 71.02% to 6 million yuan [1] - For the first three quarters of 2025, the company achieved a revenue of 805 million yuan, up 8.24% year-on-year, while the net profit attributable to shareholders fell by 84.52% to 9 million yuan [1] - The revenue growth has slowed down, and the profit has declined due to the rigid nature of operating expenses and the slowdown in revenue growth [1] Revenue and Profit Analysis - Q3 2025 revenue growth of 1.16% is a deceleration compared to the first two quarters of the year [1] - The net profit for Q3 2025 saw a significant decline of 71.02% year-on-year, indicating challenges in maintaining profitability [1] - The first three quarters of 2025 showed a net profit decline of 84.52%, highlighting ongoing profitability issues [1] Product Development and Market Position - The company is enhancing its product competitiveness through a technology-driven development strategy and increased R&D investment [2] - Significant breakthroughs have been made in various EDA systems, including digital chip design, storage chip design, advanced packaging, and 3DIC design, which are now integrated into major domestic chip design and manufacturing processes [2] - The digital EDA tool product line covers nearly 80% of the main tools for digital circuit design, and the company is expected to exceed 80% coverage in major processes by the end of 2025 [2] Profit Forecast and Investment Recommendations - Due to the slowdown in revenue growth, the company's revenue forecasts for 2025-2027 have been adjusted to 1.458 billion, 1.796 billion, and 2.197 billion yuan respectively [3] - The net profit forecasts for the same period are adjusted to 102 million, 191 million, and 284 million yuan respectively [3] - The company maintains a "buy" rating despite the adjustments in forecasts [3]

Core Viewpoint - The autonomy of EDA tools is crucial for the development of the integrated circuit industry and the security of the industrial chain, as stated by Liu Weiping, Chairman of Huada Jiutian [1][4]. Group 1: EDA Industry Development - The autonomy of the EDA industry is a prerequisite for a self-controlled industrial chain, with Huada Jiutian committed to providing comprehensive tool support for the development of China's chip industry [4]. - Huada Jiutian has achieved breakthroughs in multiple fields, including analog, digital, storage, and advanced packaging, contributing to strengthening the integrated circuit industry chain [4][5]. Group 2: Technological Advancements - Huada Jiutian has developed 48 key core EDA tools, achieving a product coverage rate of approximately 80% [5]. - The company has established a complete EDA tool system for analog circuit design, which has been deeply integrated into the core processes of leading domestic design companies [5]. - In the storage chip design sector, Huada Jiutian's solutions have improved design efficiency by over 50% through technological innovation [5]. - For digital circuit design, the performance of tools has been enhanced by over 30% through algorithm optimization and architectural innovation [6]. Group 3: Manufacturing Integration - Huada Jiutian has built a comprehensive support system for the manufacturing process, covering everything from PDK development to yield analysis [7]. - The Vision process diagnosis and analysis platform developed by the company has improved yield analysis accuracy to 99%, aiding wafer fabs in quickly identifying issues [7]. - The time required for generating TB-level mask data has been reduced to an industry-leading level, significantly enhancing the R&D efficiency of advanced processes [7]. Group 4: Future Layout and Collaboration - Huada Jiutian is proactively laying out advanced packaging and 3D IC technologies, which are essential for continuing Moore's Law [9]. - The company has established competitive solutions for Chiplet technology, reducing the design cycle by over 60% [9]. - Collaboration with wafer fabs, design companies, and educational institutions is key to building a self-sustaining EDA ecosystem [9]. - The company's R&D investment reached 365 million yuan in the first half of 2025, accounting for 72.84% of its revenue [9].