Core Viewpoint - Wuhan Xinxin Integrated Circuit Co., Ltd. (Xinxin Co.) has suspended its IPO process on the Sci-Tech Innovation Board due to expired financial documents, requiring updates for resumption of review [1][3] Financial Performance - Xinxin Co. plans to raise 4.8 billion yuan through its IPO and has shown continuous revenue growth from 2021 to 2024, with revenues of 3.138 billion yuan, 3.507 billion yuan, 3.815 billion yuan, and 3.146 billion yuan respectively [3][4] - The company's net profit has fluctuated significantly during the same period, with figures of 639 million yuan, 717 million yuan, 394 million yuan, and 138 million yuan, indicating a 45.05% year-on-year decline in 2023 [3][4] Revenue Sources - A significant portion of Xinxin Co.'s net profit in 2023 and the first three quarters of 2024 is derived from technology licensing income from an unnamed related party referred to as "Company Two" [7][9] - The contribution of this technology licensing income to net profit is substantial, with 2.84 billion yuan and 1.71 billion yuan reported for 2023 and the first three quarters of 2024, respectively [9] Industry Context - The global semiconductor industry is currently in a downturn, with comparable companies like SMIC and Hua Hong experiencing significant declines in net profit, indicating a challenging market environment [6] - Xinxin Co. has acknowledged that its net profit fluctuations are influenced by market demand, capacity utilization, R&D investments, and foreign exchange losses [6] Client Relationships - Xinxin Co.'s major clients include Hengshuo Co., which has seen a decline in procurement amounts, indicating potential shifts in client relationships [13][14] - The company has ended its capacity binding agreement with Hengshuo Co., which may impact future revenue streams [14][15] Related Party Transactions - Xinxin Co. has significant transactions with another related party, referred to as "Company Three," including a loan of 700 million yuan and various rental agreements [16][17] - There are indications that "Company Three" may be Yangtze Memory Technologies Co., Ltd., which has historical ties to Xinxin Co. [19][20]