First Full-Year Profitability! Cambricon's 2025 Revenue Surges 453%, Inventory Spike and Customer Concentration Raise Concerns

Invest in stocks with the Golden Kylin Analyst Reports—authoritative, professional, timely, comprehensive—helping you uncover potential thematic opportunities!

Daily Economic News Reporter | Ke Yang    Daily Economic News Editor | Wei Wenyu

Cambricon-U (SH688256, stock price 1,099.00 yuan, market value 463.432 billion yuan; hereinafter referred to as “Cambricon”) delivered a historic performance in 2025.

On the evening of March 12, Cambricon released its 2025 annual report, showing the company achieved an operating revenue of approximately 6.497 billion yuan, a year-over-year increase of 453.21%; net profit attributable to shareholders of the parent was about 2.059 billion yuan, compared to a loss of about 452 million yuan in the same period last year. This is also Cambricon’s first full-year profit since its listing.

However, Daily Economic News reporter (hereinafter “Daily Econ reporter”) notes that behind the impressive results, risks such as a significant increase in inventory levels and high customer concentration remain worth attention.

Data from the annual report shows that in 2025, Cambricon achieved an operating revenue of about 6.497 billion yuan, up 453.21% from approximately 1.174 billion yuan in 2024.

The sharp increase in revenue directly drove a substantial improvement in profits. In 2025, Cambricon posted a net profit attributable to shareholders of 2.059 billion yuan, compared to losses of 452 million yuan and 848 million yuan in 2024 and 2023, respectively. Cambricon also achieved its first full-year turnaround from loss to profit.

Image source: Cambricon 2025 Annual Report

Daily Econ reporter’s review shows that, from quarterly performance, Cambricon maintained a relatively balanced growth pace throughout the year. The quarterly revenues in 2025 were approximately 1.111 billion yuan, 1.769 billion yuan, 1.727 billion yuan, and 1.890 billion yuan, with the fourth quarter reaching the highest level of the year. Regarding net profit attributable to shareholders, Cambricon peaked in the second quarter at about 683 million yuan.

Regarding the reasons for the significant performance growth, Cambricon stated in its annual report that during the reporting period, the company continued to expand the market through excellent product capabilities and actively supported the deployment of artificial intelligence (AI) applications. Relying on significant progress in AI chip products, basic software platforms, and cluster software toolchains, the company’s products have been deployed at scale in key industries such as telecommunications, finance, and internet, passing rigorous customer environment tests. The products’ versatility, stability, and ease of use have been widely recognized by customers.

In terms of business structure, Cambricon mainly provides cloud-based intelligent chips, edge computing chips, as well as related IP (intellectual property) licensing and software platforms. It also offers intelligent complete machines and computing cluster solutions based on self-developed chips.

Looking at product lines, the cloud segment is Cambricon’s main revenue driver, generating about 6.476 billion yuan in 2025, a 455.34% increase year-over-year, accounting for over 99% of total revenue. The edge segment earned approximately 3.39 million yuan, and IP licensing and software business brought in about 2.29 million yuan.

Image source: Cambricon 2025 Annual Report

As AI applications move from experimental to large-scale deployment, data centers’ demand for computing infrastructure has significantly increased, opening new market opportunities for AI chip companies. Cambricon mentioned in its annual report that as models become more complex, the corresponding computing power demand rises, and the AI chip market is expected to see new incremental demand. According to IDC estimates, from 2022 to 2027, China’s intelligent computing power market will grow at a compound annual growth rate of 33.9%.

While turning a profit, Cambricon maintains high R&D investment levels.

In 2025, R&D expenditure was about 1.169 billion yuan, up 9.03% year-over-year; R&D spending accounted for 17.99% of operating revenue, significantly lower than 91.30% in 2024, mainly due to the substantial increase in revenue base, which reduced the R&D ratio proportionally.

However, alongside high revenue growth, Cambricon’s inventory levels are also rising rapidly.

The annual report shows that as of the end of 2025, Cambricon’s inventory book value was approximately 4.944 billion yuan, a surge of 178.67% from 1.774 billion yuan at the end of 2024. The proportion of total assets increased from 26.41% to 36.79%.

In this regard, Cambricon stated in the annual report that the increase in inventory mainly results from higher raw material stocking during the period. “If market conditions change in the future, there may be increased risk of inventory devaluation, which could adversely affect the company’s profitability.”

Additionally, in 2025, the combined sales to the top five customers totaled 5.76 billion yuan, accounting for 88.66% of the annual sales. The largest customer’s sales accounted for over 26%. Although the proportion of sales to the top five customers decreased from 94.63% in 2024, it remains relatively high.

Over the past three years (2023-2025), the total sales to the top five customers accounted for 92.36%, 94.63%, and 88.66% of operating revenue, respectively.

Regarding the supply chain, Cambricon indicated that the entire integrated circuit industry chain is highly specialized and has high technical barriers. Additionally, some subsidiaries have been listed on the “Entity List,” which poses certain risks to supply chain stability. Switching suppliers will incur costs and may negatively impact operations. However, the company’s core technology is independently developed by Cambricon, with proprietary intellectual property rights. To address these risks, the company plans to maintain good communication with relevant parties throughout product development stages, based on industry policies and long-term, extensive cooperation along the supply chain, actively exploring solutions to ensure sustained business growth.

Furthermore, Cambricon disclosed its 2025 profit distribution plan, which proposes a cash dividend of 15 yuan per 10 shares (tax included), and a capital reserve transfer of 4.9 shares for every 10 shares. Based on current share capital, the total cash dividend amounts to approximately 632 million yuan, representing 30.71% of net profit attributable to shareholders for the period.

Disclaimer: The content and data in this article are for reference only and do not constitute investment advice. Please verify before acting. Use at your own risk.

Cover image source: Daily Econ Media Library