Dongxin Co., Ltd. Q3 revenue increased by 27.03% year-on-year, gross margin significantly improved, and net loss narrowed to 35.22 million yuan | Financial Report News

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Eastchip Co., Ltd. Q3 revenue increased by 27.03% year-on-year and 14.35% quarter-on-quarter, and gross profit margin increased by 10.57 percentage points year-on-year to 26.64%, indicating a rebound in industry prosperity and effective sales promotion by the company. However, the company remains in a loss position, with Q3 net profit attributable to shareholders at -35.22 million yuan, and a cumulative loss of 146 million yuan for the first three quarters.

On the 28th, Dongxin Semiconductor released its 2025 Q3 performance report:

Operating revenue was 229.6 million yuan, up 27.03% year-on-year and 14.35% quarter-on-quarter, achieving sequential growth throughout the year.Net loss attributable to shareholders of the listed company was 35.22 million yuan, narrowing from 39.22 million yuan in the same period last year.Gross profit margin increased by 10.57 percentage points year-on-year to 26.64%.

Revenue and Gross Margin Both Up, Industry Recovery Effective

Financial data show that Dongxin Semiconductor’s improvement in the third quarter was mainly driven by an increase in both revenue and gross margin. In the quarter, the company achieved operating revenue of 229.6 million yuan, up 27.03% year-on-year and 14.35% quarter-on-quarter, with sequential growth throughout the year.

The company attributes this to a combination of several key factors: firstly, the overall recovery of the semiconductor design industry led to a rebound in downstream market demand; secondly, the company achieved significant year-on-year growth in product sales in key application areas such as network communication, security monitoring, and consumer electronics.

In addition, with the market recovery, prices of some products have rebounded. The company said that by continuously optimizing product structure and market strategies, improving operational efficiency, and reducing product costs, its gross margin improved from 16.07% (adjusted) in the same period last year to 26.64% in the current period.

R&D and Investments Drag, Profitability Under Pressure

The financial report shows that the company continues to feel pressure on costs and investments. During the reporting period, total R&D expenditure reached 57.07 million yuan, up 9.31% year-on-year. The company stated that R&D expenses were mainly aimed at maintaining high-level investment in the memory segment to advance memory chip process upgrades. Meanwhile, its Wi-Fi chip products are still in the R&D stage and have yet to generate revenue.

On the other hand, external investments also directly impacted profits. The company confirmed an investment loss of 15.84 million yuan in its associate company Lisuankeji (Shanghai) Co., Ltd., which is one of the key factors contributing to this quarter’s loss. After deducting non-recurring gains and losses, the company’s net loss for the third quarter was 39.98 million yuan, narrower than the loss of 53.56 million yuan in the same period last year.

In the first three quarters, net cash flow from operating activities was -168 million yuan, a significant improvement compared to a net outflow of -244 million yuan for the same period last year. This was mainly due to increased payment collection as a result of revenue growth. As of the end of the reporting period, the book value of inventory was as high as 1.004 billion yuan, up 12.5% from 892 million yuan at the end of 2024.

Pushing Forward “Storage-Computing-Connectivity” Strategy with Deployment and Incentives

To advance its integrated “Storage-Computing-Connectivity” strategy, Dongxin Semiconductor adopted a number of important measures during and after the reporting period. The company recently announced plans to use about 211 million yuan of its own funds to increase capital in Lisuankeji (Shanghai) Co., Ltd. After completion, its expected shareholding will be about 35.87%.

To attract and retain core talent, the company also launched a 2025 restricted stock and stock appreciation rights incentive plan. According to the announcement, on October 16, the company granted about 900,000 restricted shares to 141 incentive recipients and granted 324,000 stock appreciation rights to 7 incentive recipients to closely align the interests of shareholders, the company, and the core team.

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