Cambrian Company, which was known as the “No. 1 AI chip stock” in the A-share market and rode the wave of generative AI and saw its stock price soar, eventually “fell”. Not long ago, Cambrian's 150.1 million initial shareholder shares were lifted from sales restrictions, accounting for 36.02% of the company's total share capital. With the release of this news, the company's stock price fell 5.14% the next day. In the following two weeks, the company's stock price fell all the way from 134.90 yuan/share on the day the ban was lifted to 120.80 yuan/share at the time of publication, a significant drop.
Since the company's stock price peaked at 271.47 yuan per share in April 2023, Cambrian's stock price has fallen by more than 55.47%, and its market value has been cut in half. While the stock price has fluctuated sharply, Cambrian Company's revenue has continued to decline year-on-year since 2023. In the first three quarters, the company's revenue was 145 million yuan, a year-on-year decrease of 44.84%; during the same period, the company's losses accumulated to 808 million yuan.
Statistics from Sina Technology found that Cambrian's revenue in the first three quarters of 2023 has reached the company's lowest level in the past three years, but the loss momentum has not decreased. Prior to this, Cambrian was also exposed in July 2023 that its smart driving chip business had failed. "Nearly half of the employees in the software department were laid off, and only a few employees were retained in the hardware department."
With revenue plummeting and losses continuing, Cambrian has experienced several rounds of shareholder clearances and reductions. With the arrival of a large-scale stock lifting period, the myth of high market value may no longer be sustainable.
The market value has been cut in half, but the valuation has soared in the past year, but the revenue has dropped sharply.
Since the beginning of 2023, with the explosion of generative AI and the digital economy and information innovation sectors becoming market leaders, the Cambrian, which is the "number one AI chip stock", has caught a ride on the rising market value of track companies. In the first half of 2023, Cambrian's stock price soared from about 54 yuan to the highest price of 271.47 yuan per share during the year, with the highest cumulative increase in the range being nearly 4 times.
However, while the stock price skyrocketed, Cambrian's revenue situation did not improve accordingly. Instead, it showed an increase in revenue without increasing profits or even a sharp decline in revenue. According to Sina Technology statistics, from 2020 to 2022, Cambrian's operating income was 459 million yuan, 721 million yuan, and 729 million yuan respectively, with growth rates of 3.38% and 57.12% respectively. %, 1.11%; excluding non-net profits were -434 million yuan, -823 million yuan, and -1.257 billion yuan respectively, down 74.86%, 68.61%, and 34.09% respectively year-on-year.
Since entering 2023, the computing power demand generated by the new wave of AI large model technology should have allowed Cambrian to obtain more commercial orders and revenue sources, but the company has experienced a sharp decline in revenue.
In the first half of 2023, Cambrian delivered its worst half-year report since its listing. During the reporting period, the company's operating income was 114 million yuan, a year-on-year decrease of 33.37%. The net profit attributable to the parent company was a loss of 544 million yuan. After deducting non-compliance, the net profit loss attributable to the parent company was 640 million yuan, a year-on-year increase of 15.39%. As of the third quarter, Cambrian's cumulative revenue was 145 million yuan, a year-on-year decrease of 44.84%; the cumulative loss during the same period was 808 million yuan, which continued to expand.
The rising market value is not consistent with the company's true revenue capabilities. Since entering the second half of 2023, as the enthusiasm for market speculation has receded, the stock price of Cambrian Company has begun to decline significantly. As of press time, the company's stock price is 127.96 yuan per share, which has fallen by more than 52% from the highest price of 271.47 yuan per share at the beginning of the year, and the company's market value has also been cut in half.
"Abandoned" by venture capital shareholders, the amount has now exceeded 4 billion
As Cambrian's stock price has risen rapidly this year, a group of Cambrian's old shareholders have begun to feel restless.
From March 23 to June 29 this year, Cambrian Venture Capital shareholder SDIC Venture Fund reduced its holdings of 7.3987 million shares of Cambrian through block transactions and centralized bidding transactions. The average price of the reduction was 158.00-266.16 yuan, and the total amount of reduction was 1.481 billion yuan. Prior to this, SDIC Venture Fund had cashed out more than 466 million yuan through reduction of holdings.
In addition, Ningbo Hangao Investment Partnership (Limited Partnership) also cleared Cambrian from September 16, 2022 to March 6, 2023, cashing out 225 million yuan. Paleozoic Venture also reduced its holdings by a total of 4.2887 million shares from November 15, 2022 to March 14, 2023, cashing out 361 million yuan.
From February 9 to June 7, 2023, Nanjing CMB and Hubei CMB reduced their holdings of Cambrian shares by 3.1146 million shares and 1.5395 million shares respectively, cashing out 388 million yuan and 191 million yuan respectively. On August 26, Cambrian announced another round of completion of Paleozoic Entrepreneurship reduction announcement. Paleozoic Entrepreneurship cleared and reduced its holdings of 5.9754 million shares of Cambrian from March 23 to August 24, with an average price reduction of 152.77-225.84 yuan, and cashed out 1.071 billion yuan.
So far, Cambrian's five venture capital shareholders have all completed liquidation in the first half of this year, with a cumulative reduction of 4.183 billion yuan in cash. Prior to this, iFlytek, the ninth largest shareholder of Cambrian shares in circulation, also reduced its holdings in Cambrian in the third quarter of 2022 and withdrew from the list of the top ten shareholders.
But the founding shareholders no longer believe in Cambrian. The safe exit space created by the high market value has allowed old shareholders to make a steady profit.
Accused of "unfocused business", can high investment stabilize high market value?
In 2023, while the stock price soared and the company's revenue dropped sharply, Cambrian also experienced a round of business adjustments.
In July this year, Sina Technology exclusively reported on "Large layoffs in Cambrian Intelligent Driving Chip Business Xingge Technology", pointing out that new projects in this business have been suspended. At the same time, nearly half of the employees in the software department have been laid off, and only a few employees in the hardware department have been retained to "take care of the aftermath." This is the second time Cambrian has been exposed to layoffs since its massive layoffs in April 2023.
At the beginning of its establishment, Cambrian served as a supplier of Huawei's NPU (neural network processor) and received a large number of commercial orders. However, later, Huawei kicked Cambrian out of the supply chain by developing its own NPU. In this regard, Huawei's rotating chairman Xu Zhijun's public explanation is that "building a self-developed architecture to support AI chips is based on Huawei's understanding of AI and the demand for AI in the device, edge and cloud. Cambrian is good, but it cannot support all our scenarios."
In the following years, in order to make up for the limitations that Huawei said "cannot support our full scenarios". Cambrian began to develop all-round efforts in the cloud, edge and even basic software fields. But the more this happens, the more chaotic the company's business begins to become.
According to Cambrian’s official introduction, “The company can provide software and hardware synergy capabilities that integrate cloud-edge-end training and promotion, and also has a unified ecological series of smart chip products and platform-based basic system software.” But behind this series of introductions, what do the outside world think of Cambrian as a chip company? Or a software company or cloud computing company? The doubts are getting thicker.
In communication with Sina Technology, Li, a business director of SDIC Investment Investment who has been responsible for primary and secondary market investments for a long time, publicly stated, "Cambrian's current thinking is quite similar to the path of most cloud vendors, but the company does not seem to have enough resources and capabilities to do these systematic tasks."
In his view, "IP design is only one aspect of computing chips, followed by manufacturing links and the entire cloud computing ecosystem. Currently, there are many innovative methods in the field of domestic computing chips, but no computing chip company has yet established a better model. Under such circumstances, business focus is better than doing anything else."
"Huawei can do these things in the Cambrian era, but it will be difficult in the Cambrian era," said Li. After all, if the computing chip track has long slopes and thick snow, and it lacks revenue sources and only relies on financing and blood transfusions to maintain the company's high-intensity R&D investment, such a model will be difficult to sustain.
Text丨Sina Technology Zhou Wenmeng