Summary of Conference Call Records Company and Industry Involved - The records pertain to **CXL technology** and **AI chip development** within the **semiconductor industry**. - The company mentioned is **澜起科技 (Lianqi Technology)**, which is involved in the development of various chips including CXL and PCIe technologies. Core Points and Arguments - **Investment and Listing**: The company went public on February 9, raising up to **70 billion HKD** with a share price not exceeding **106.89 HKD**. Key cornerstone investors include **AlisoftChina** (an Alibaba subsidiary) and **华勤通讯 (Huaqin Communication)** [1] - **CXL Memory Pooling**: Alibaba Cloud is advancing **CXL memory pooling** technology, showcasing a new architecture for large model inference at the **2026 PolarDB Developer Conference**. This architecture is designed for elastic scaling and cross-machine sharing for AI applications [1] - **CXL Alliance Participation**: Alibaba Cloud is a founding member of the **CXL Alliance**, promoting solutions related to memory pooling, heterogeneous interconnects, and AI inference optimization across various business scenarios [1] Product Development Progress - **CXL3.1 MXC Chip**: The company is on track to launch the **CXL3.1 MXC chip** in 2025, which supports both **CXL.mem** and **CXL.io** protocols. Samples have been sent to major clients for testing [2] - **PCIe Retimer Chip**: The company is also set to release a **PCIe6.x/CXL3.x Retimer chip** in 2025, with successful sample deliveries [2] - **Clock Chips**: Clock buffer and spread spectrum oscillator products have entered the customer sampling phase [2] Market Demand and Future Outlook - **Increased Demand for Memory Interface Chips**: The company anticipates a significant increase in shipments of **DDR5 memory interface and module chips** due to rising demand driven by the AI industry. The expected order value for the second-generation **MRDIMM** chips is over **140 million RMB** as of October 27, 2025 [3] - **MRDIMM Penetration**: The company is optimistic about the penetration rate of the second-generation MRDIMM, indicating a positive outlook for future sales and market growth [3]

Core Viewpoint - The company, 澜起科技, is expected to see significant growth in its 2025 annual performance, driven by the booming AI industry and increased demand for its interconnect chips [1][2]. Financial Performance - For 2025, 澜起科技 anticipates a net profit attributable to shareholders of between 2.15 billion and 2.35 billion RMB, representing a year-on-year increase of 52.29% to 66.46% [1][2]. - The company expects a non-recurring net profit of 1.92 billion to 2.12 billion RMB, reflecting a growth of 53.81% to 69.83% compared to the previous year [1][2]. - In 2024, 澜起科技 reported a revenue of 3.639 billion RMB, a year-on-year increase of 59.20%, and a net profit of 1.412 billion RMB, up 213.10% [4]. Market Trends and Product Development - The growth in 澜起科技's performance is attributed to the strong demand in the AI sector, with a notable increase in the shipment of interconnect chips [1][2]. - The company launched its second-generation MRCD/MDB chips in January 2025, with expected orders exceeding 140 million RMB for the next six months [3]. - The transition of AI from training to inference is anticipated to drive further demand for high-speed interconnect chips [3]. Upcoming IPO and Strategic Partnerships - 澜起科技 is making progress on its H-share listing plan in Hong Kong, with key investors such as Alibaba and Morgan Asset Management participating as cornerstone investors [1][7]. - The company has received necessary approvals from regulatory bodies, including the China Securities Regulatory Commission, for its overseas listing [7]. Company Background - 澜起科技 is a leading international designer of data processing and interconnect chips, focusing on high-performance, low-power chip solutions for cloud computing and AI [6]. - The company has a significant presence in overseas markets, with revenue from international markets accounting for 84.02% and 70.83% of total revenue in 2023 and 2024, respectively [6].

Core Viewpoint - The demand for high-speed data transmission in data centers is experiencing exponential growth due to the AI model revolution, positioning interconnect chips as a critical sector in the technology industry [1]. Group 1: Company Overview - Lanqi Technology, a leading global memory interconnect chip company, is set to raise funds through its listing on the Hong Kong Stock Exchange to enhance R&D and commercialization efforts [1]. - The company has a strong market presence, holding a significant share in the global interconnect chip market, particularly in memory interconnect and PCIe/CXL segments [2][7]. Group 2: Competitive Advantages - Lanqi Technology has established a dual barrier of "R&D innovation + standard-setting" as its core competitive advantage, with a total of 208 patents and significant R&D investments amounting to 2.54 billion RMB from 2022 to 2024 [2][5]. - The company is one of the few suppliers offering a full range of memory interface chips from DDR2 to DDR5, with its DDR4 architecture adopted as an international standard by JEDEC [3]. Group 3: Market Position - In the memory interconnect chip market, Lanqi Technology is projected to hold a 36.8% market share in 2024, ranking first globally alongside Renesas and Rambus [7]. - The company is rapidly gaining traction in the PCIe Retimer segment, expected to achieve a 10.9% market share in 2024, ranking second globally [7]. Group 4: Financial Performance - The company's revenue is expected to grow significantly, with a forecasted increase from 3.67 billion RMB in 2022 to 4.06 billion RMB in 2025, reflecting a 57.8% year-on-year growth in the first three quarters of 2025 [9][10]. - The gross profit margin has been steadily increasing, reaching 61.5% in the first three quarters of 2025, with interconnect chips achieving a gross margin of 64.8% [10]. Group 5: Industry Growth Potential - The global high-speed interconnect chip market is anticipated to grow from $15.4 billion in 2024 to $49 billion by 2030, with a CAGR of 21.2%, driven by the increasing demand for AI servers and data center upgrades [12]. - Lanqi Technology's strategic focus on Ethernet and optical interconnects is expected to open new market opportunities, covering a wide range of interconnect needs from memory to system-level solutions [12]. Group 6: Future Strategies - The company plans to allocate the net proceeds from its Hong Kong listing towards R&D in advanced interconnect technologies, commercial expansion, and strategic investments [14]. - With a strong financial foundation, including cash reserves of 8.77 billion RMB and a low debt ratio of 10.9%, the company is well-positioned to capitalize on growth opportunities in the AI infrastructure sector [14].

Core Insights - The article highlights a significant increase in order volumes among nearly 200 A-share listed companies, indicating a robust industrial climate in China, particularly in the machinery, electronics, and power equipment sectors [2] - The shift from "product export" to "value chain export" is evident, with companies leveraging technology and brand strength to secure key orders in high-end markets [3][6] - Emerging industries such as AI, energy storage, and semiconductors are experiencing substantial order growth, reflecting the transformation of technological trends into rapid market expansion [7][8][9] Group 1: Industrial Performance - Nearly 200 A-share listed companies reported "full orders" or "industry prosperity," with machinery, electronics, and power equipment being the most vibrant sectors [2] - Companies like Tongyu Communication and Chutian Technology are accelerating their globalization efforts, achieving significant breakthroughs in developed markets [3] - Keda Manufacturing reported that its ceramic machinery orders exceeded the previous year's figures, with over 65% of orders coming from overseas [5] Group 2: Emerging Industries - The AI, energy storage, and semiconductor sectors are seeing high growth in orders, with companies like Lanke Technology reporting over 140 million yuan in pending orders for their DDR5 chips [7] - The energy storage market is recovering rapidly, driven by global energy transitions, with companies like Nanfang Technology noting a temporary supply shortage in high-quality battery cells [8] - The semiconductor industry is benefiting from a dual boost of cyclical recovery and domestic substitution, with companies like Aisen Co. reporting over 40% revenue growth [9] Group 3: Traditional Industries - Traditional heavy industries such as marine equipment and shipbuilding are also showing strong performance, with some companies' order backlogs extending to 2027 or 2029 [10][11] - CIMC reported a backlog of approximately 5.55 billion USD in its marine engineering segment, with production scheduled through 2027-2028 [10] - Xiamen Xiangyu's shipbuilding business has orders scheduled through 2029, reflecting a robust demand in marine oil and gas development [11]

Core Viewpoint - The semiconductor industry, particularly in storage products, is entering a price upcycle driven by the demand from AI technology, marking a "super cycle" in the market [1][2]. Group 1: Price Trends and Market Dynamics - Storage products have seen significant price increases since September, with prices for certain memory products rising from over 100 yuan to 300 yuan per unit within two months [1]. - The current price uptrend is characterized by rapid order backlogs and a global restructuring of the storage industry, with companies needing to convert external benefits into R&D investments and customer loyalty for sustainable growth [1][2]. Group 2: Impact on Industry Chain - Upstream companies like SMIC are benefiting from the price increases, reporting a 95.8% capacity utilization rate and a 4.6% increase in shipment volume [2]. - Midstream companies face a dual impact: while rising storage prices positively affect profit margins, the stability of the supply chain is a concern, prompting companies to secure long-term contracts with suppliers [2]. - Downstream manufacturers are expected to face challenges as rising storage prices increase overall production costs, leading to downward revisions in production forecasts for smartphones and laptops [2]. Group 3: Technological Innovation and Future Outlook - The current price surge is not seen as a short-term fluctuation but rather a result of AI-driven demand and supply constraints from leading manufacturers [3]. - Industry experts predict that the price increase may continue until 2026, with some suggesting potential shortages could last until 2027 [4]. - Companies are focusing on technological innovation to enhance core competitiveness, with examples including the development of integrated products for AI wearables and advancements in packaging technology [4][5].

Core Insights - The company reported a record high quarterly revenue of 1.424 billion yuan in Q3 2025, representing a year-on-year growth of 57.22% and a quarter-on-quarter growth of 0.92% [1] - The net profit attributable to shareholders for Q3 2025 was 473 million yuan, showing a year-on-year increase of 22.94% [1] Cumulative Performance - For the first three quarters of 2025, the company achieved a total revenue of 4.058 billion yuan, a significant year-on-year increase of 57.83% [3] - The cumulative net profit attributable to shareholders reached 1.632 billion yuan, with a year-on-year growth of 66.89% [3] Business Growth Drivers - The interconnect chip business is the main driver of the company's rapid growth, with Q3 revenue from this segment reaching 1.371 billion yuan, a year-on-year increase of 61.59% and a quarter-on-quarter increase of 3.78% [3] - This product line has seen continuous quarter-on-quarter revenue growth for 10 consecutive quarters [3] Profit Adjustment - The quarter-on-quarter decline of 25.33% in net profit was primarily due to increased share-based payment expenses resulting from the rise in the company's stock price, amounting to 353 million yuan in Q3 [3] - Excluding this expense, the adjusted net profit attributable to shareholders would be 811 million yuan, reflecting a year-on-year growth of 105.78% and a quarter-on-quarter growth of 10.96% [3] Product Development - The company is accelerating new product development, having launched a memory expansion controller (MXC) chip based on CXL 3.1 in Q3, which is currently undergoing sample testing with major clients [3] - Additionally, clock buffers and spread spectrum oscillator products have also entered the customer sample testing phase [3] Order Backlog - As of October 27, 2025, the company has a robust order backlog, with anticipated deliveries of DDR5 second-generation MRCD/MDB chips exceeding 140 million yuan in the next six months [4]

Investment Rating - The investment rating for the company is "Accumulate" (maintained) [2] Core Views - The company has launched new products rapidly and has a full order book, with significant growth in revenue and net profit reported for the first three quarters of 2025 [7] - The company expects to achieve revenues of RMB 56.99 billion, RMB 77.28 billion, and RMB 94.64 billion for 2025, 2026, and 2027 respectively, with corresponding net profits of RMB 20.43 billion, RMB 31.15 billion, and RMB 40.77 billion [7] Financial Performance - For the first three quarters of 2025, the company achieved revenue of RMB 40.58 billion, a year-on-year increase of 57.83%, and a net profit of RMB 16.32 billion, up 66.89% year-on-year [7] - The company’s revenue for Q3 2025 was RMB 14.24 billion, reflecting a year-on-year increase of 57.22% and a quarter-on-quarter increase of 0.92% [7] - The interconnect chip revenue for Q3 2025 was RMB 13.71 billion, a year-on-year increase of 61.59% and a quarter-on-quarter increase of 3.78% [7] Earnings Forecast - The company’s projected earnings for 2025 include revenue of RMB 5,699 million, a growth rate of 56.6%, and a net profit of RMB 2,043 million, with a net profit growth rate of 44.7% [6] - The projected EPS for 2025 is RMB 1.78, with a PE ratio of 85.2 [6] Product Development - The company has accelerated the launch of new products, including the CXL 3.1 memory expansion controller (MXC) chip, which is currently in the sample testing phase with major clients [7] - As of October 27, 2025, the company has over RMB 1.4 billion in orders for the DDR5 second-generation MRCD/MDB chips expected to be delivered in the next six months [7]