Woofun AI reports that Xingsen Technology has achieved a dramatic financial turnaround, shifting from a net loss of 198 million yuan in 2024 to a net profit of 135 million yuan in 2025, propelled by the resurgence of the AI-driven economy. As of the market close on June 25, the company's market capitalization stood at 90.98 billion yuan, reflecting investor confidence in its strategic pivot toward advanced packaging substrates and optical modules. On the evening of June 23, the firm announced a private placement plan to raise no more than 3.9 billion yuan, earmarked specifically for advanced mSAP substrate intelligent manufacturing and integrated circuit packaging substrate projects. These capital injections are designed to expand production capacity for optical module substrates and IC packaging substrates, directly addressing the surging demand generated by the artificial intelligence industry. The trajectory of Xingsen Technology represents a rare case where a mature sector player leveraged a technological paradigm shift to reverse a decade of stagnation and achieve a valuation exceeding 90 billion yuan.

The origins of this enterprise were born of necessity rather than opportunity, rooted in the precarious financial state of its predecessor. In 1989, Qiu Xingya, then 21 years old, graduated from the Business Administration program at Central South University of Technology, now known as South China University, and began his career in the comprehensive planning department of a state-owned machinery factory in Wuxi. Two years later, he relocated to Guangzhou to work as a general clerk in the marketing department of Guangzhou Pulin Circuit Co., Ltd., eventually rising through the ranks to become a scheduler and later the manager of the business planning department. By August 1995, Qiu Xingya had joined Guangzhou Kuaijie Circuit Board Co., Ltd. as its general manager, an entity established in 1993 that specialized in double-sided and multi-layer circuit boards with a particular strength in PCB prototypes. The Asian financial crisis of 1997 devastated the sector, leaving Guangzhou Kuaijie's parent company, Chaojie Enterprise Co., Ltd., on the verge of bankruptcy by 1998. Facing a critical career juncture, Qiu Xingya observed that most PCB prototype services were dominated by expensive and slow providers from Hong Kong and Taiwan, creating a vacuum for a mainland-based competitor familiar with local operational paces. With Huawei expressing a need for a reliable circuit board manufacturer and hoping for the survival of Guangzhou Kuaijie, Qiu Xingya decided to take a calculated risk. He borrowed funds from friends and mobilized employees to raise capital, leading to the establishment of Guangzhou Xingsen Kuaijie Circuit Technology Co., Ltd. in 1999 by him and several colleagues from Guangzhou Kuaijie. This new entity would eventually evolve into the listed company Xingsen Technology.

Structurally, the company's early success was defined by its differentiated positioning in the niche market of PCB prototypes, also known as prototype production. These products are essential during the research, testing, development, and pilot production stages of new products, requiring manufacturers to balance product quality and stability with speed and flexibility. Unlike mass production orders, prototype orders typically involve small production areas, generally less than 5 square meters per order, while small-batch orders, which Xingsen also undertakes, range between 5 and 20 square meters. Despite the smaller scale, these orders command significantly higher gross profit margins compared to mass production. Before the explosion in AI demand, Xingsen Technology's PCB business maintained gross profit margins that far exceeded those of its peers. The gross profit margins of leading competitors were as follows: Dongshan Precision (electronic circuit business) at 15.50%, Pengding Holdings at 20.39%, Shanghai Electric Shares at 28.50%, Shenghong Technology at 20.37%, and Shennan Circuit (PCB business) at 25.28%. In stark contrast, Xingsen Technology's PCB business gross profit margin reached 33.13%. This high-margin strategy allowed the company to become the 'number one in Asia' in its niche market just one year after its establishment. The deep cooperative relationship with Huawei, which remained the company's largest customer until its 2010 IPO, laid the foundation for this dominance. In August 2001, Qiu Xingya and co-founder Jin Yuxing, both alumni of Guangzhou Kuaijie, acquired Chaojie Enterprise, thereby gaining control of 40% of the shares of Guangzhou Kuaijie and effectively acquiring their former parent company.

Woofun AI data shows that the company's financial volatility in recent years was driven by a combination of declining traditional demand and heavy investment in new sectors. From 2022 to 2024, Xingsen Technology shifted from profit to loss due to shrinking gross profit margins in its traditional PCB business and losses in its packaging substrate division, culminating in a net loss of 198 million yuan in 2024.

However, the recovery of the AI economy in 2025 reversed this trend, enabling the company to post a net profit of 135 million yuan. While the traditional PCB business has recovered, it currently faces a significant decline in gross profit margins and has fallen behind leading AI PCB companies such as Shennan Circuit, Shenghong Technology, and Shanghai Electric Shares. To address this, the company has identified the optical module business as a key priority for 2026. Its subsidiary, Beijing Xingsifei, is currently in the mass production phase of 1.6T optical module product boards and is simultaneously conducting verification and introduction work for multiple customers. According to the private placement plan, revenue from PCBs used in optical modules in 2025 will not exceed 150 million yuan, accounting for no more than 2.08% of total revenue. The mSAP substrate project, intended to expand optical module production, has not yet started, leaving a considerable time gap before it can contribute to revenue. In the highly competitive AI industry chain, the ability of this business to capitalize on the AI boom remains uncertain.

Beyond optical modules, the capital market is intensely focused on Xingsen Technology's packaging substrate business, particularly its FCBGA (flip chip ball grid array) segment. Packaging substrates, or IC carriers, serve as the medium between chips and PCBs, requiring high technical expertise and long-term investment. These substrates connect to chips via wire bonding (WB) or flip chip (FC) methods and to PCBs via ball grid array (BGA) or chip level packaging (CSP). FCBGA products, which combine flip chip and ball grid array technologies, possess the highest number of layers and technical requirements, making them ideal for packaging AI chips. Xingsen Technology entered this field in 2012, initially developing CSP packaging substrates. By September 2018, the company obtained Samsung certification, becoming the only mainland Chinese supplier of IC packaging substrates for Samsung at that time. By 2025, packaging substrates had become the company's second-largest business, generating 1.67 billion yuan in revenue, which accounted for 23.22% of total revenue.

However, this segment has not yet turned profitable, recording a gross profit margin of -16.06% in 2025. The revenue is primarily derived from earlier-developed CSP products, while the private placement project aims to produce high-end CSP substrates for storage, automotive, and radio frequency chips. The market, however, remains more interested in FCBGA products for AI chips.

In 2022, Xingsen Technology officially entered the FCBGA packaging substrate field, launching two major projects in Guangzhou and Zhuhai. As of August 27, 2025, the total investment in these FCBGA projects exceeded 3.8 billion yuan. This substantial capital outlay has yielded tangible technical results: the company now possesses the capability to mass-produce FCBGA products with 20 layers or fewer. The yield for low-layer boards, typically 10 layers or fewer, exceeds 95%, while the yield for high-layer boards exceeds 90%. Considering technology research and development, production capacity layout, and product progress, Xingsen Technology's FCBGA business ranks second only to Shennan Circuit among A-share PCB listed companies. Another domestic leader, Qunce Technology, is also preparing to list on the Hong Kong stock market. Despite these achievements, the revenue contribution of the FCBGA business remains relatively small and has not met expectations. From 2023 to 2025, the overall operation of the FCBGA projects dragged significantly on net profit. In its 2025 annual report, the company disclosed that due to subpar mass production progress and investment returns, a provision for impairment of 5.2666 million yuan was made for the Zhuhai FCBGA project. The introduction of mass production orders involves a rigorous process including factory inspections, sample introductions, reliability tests, and the issuance of mass production orders, all of which are highly dependent on industry supply and demand, customer progress, and supplier management strategies. Currently, FCBGA products are in the small-batch production stage with varying progress across different customers, leaving considerable uncertainty.

In the global FCBGA packaging substrate market, Japanese and Korean companies currently hold a leading position, with Japanese firms ahead in technology and high-end products. Mainland Chinese companies, having started later, are in a stage of catching up through large-scale investment. Xingsen Technology stands out as one of the mainland companies that the market views with optimism. Whether the firm can achieve domestic substitution in areas such as FCBGA packaging substrates remains a critical variable for its future valuation. The company's journey from a forced startup in 1999 to a 90 billion yuan enterprise illustrates the resilience required to navigate sectoral shifts. This highlights the sector's sensitivity to AI-driven demand cycles, highlighting the sector's sensitivity to AI-driven demand cycles. The success of the upcoming mSAP and FCBGA projects will ultimately determine if Xingsen Technology can sustain its momentum or if it will face the same cyclical headwinds that previously threatened its existence.