Abstract:
After storage manufacturer Changxin Technology (688825.SH) released its third-quarter performance forecast, its stock price plummeted in early trading on October 19. As of 10:40 a.m., Changxin Technology fell 6.31%, its market value evaporated by 192.7 billion yuan, and its total market value was 2.87 trillion yuan. Its market value returned to less than 3 trillion yuan, and it also slipped from first to third place in the A-share market value rankings.
On the news, Changxin Technology released a performance forecast for the first three quarters on the evening of October 16. It is expected that the revenue in the first three quarters will be 265 billion yuan to 270 billion yuan, a year-on-year increase of 726% to 741.5%, and the net profit will be 131 billion yuan to 132.5 billion yuan, turning losses into profits year-on-year.
According to the performance forecast, Changxin Technology’s revenue in the third quarter was 114.69 billion yuan to 119.69 billion yuan, a year-on-year increase of 589% to 619%, and its net profit was 53.395 billion yuan to 54.895 billion yuan. Compared with the second quarter, the revenue increased by 95.9% month-on-month, and the net profit increased by 113.4% month-on-month. In the third quarter, Changxin Technology’s revenue increased by 15.25%~20.3% month-on-month, and the net profit increased by 1.04%~3.88% month-on-month.
This means that although Changxin Technology’s revenue and net profit in the third quarter are still growing rapidly year-on-year, the quarter-on-quarter growth rate has slowed down.
Some time ago, Changxin Technology was in a stage of rapid growth. Changxin Technology originally expected to achieve profitability in 2026 or 2027, but subsequently disclosed information showed that last year’s revenue was 61.799 billion yuan, a year-on-year increase of 155.6%, and net profit was 1.87 billion yuan, achieving profitability earlier than expected. In the first half of this year, Changxin Technology’s revenue was 150.31 billion yuan, a year-on-year increase of 873.64%, and its net profit was 77.605 billion yuan, which also exceeded the previous expectations of “revenue of 110 billion yuan to 120 billion yuan, and net profit of 50 billion yuan to 57 billion yuan.”
However, with the disclosure of the third quarter performance forecast, the narrative of performance exceeding expectations and rapid growth has been re-evaluated by the market. The company's disclosure of information related to share repurchases does not seem to significantly boost investor confidence.
Changxin Technology announced Chairman Zhu Yiming’s proposal for repurchase on the evening of October 16. Zhu Yiming proposed that the company use its own or self-raised funds to repurchase some of the issued RMB ordinary shares through centralized bidding transactions. The total repurchase funds should not be less than 1 billion yuan and not exceed 2 billion yuan.
What is the background of the slowdown in quarter-on-quarter growth of Changxin Technology? The company did not explain in detail in the announcement, but said that the demand for AI computing power has grown rapidly since the second half of 2025, and the company's capacity utilization rate has remained high in the first three quarters of this year. However, other domestic storage industry chain companies that have disclosed performance forecasts mentioned changes in the industry.
According to the performance forecast data recently disclosed by storage module and brand manufacturer Longsys (301308.SZ), the company’s non-net profit in the third quarter fell by 22% to 38% month-on-month. Longsys said that the overall supply and demand pattern of the global memory market in the third quarter was still tight. However, due to the higher price base in the previous period, the price increases of DRAM and NAND flash memory were significantly narrower than in the previous period, and the marginal contribution of rising storage prices to the company's profits has significantly slowed down.
Market research institutions also predict the narrowing of price increases. TrendForce predicts that general DRAM prices will increase by 13% to 18% month-on-month in the third quarter of this year, which is narrower than the previous quarter. The month-on-month growth rate in the fourth quarter will further shrink to 10% to 15%.
Among other leading storage manufacturers, the recent financial report data released by Samsung Electronics (005930.KS) has also triggered discussion. Although Samsung Electronics' operating profit exceeded 100 billion won in the third quarter of this year, with sales and operating profit both hitting single-quarter highs, the year-on-year growth in performance has narrowed quarter-on-quarter.
Comments