Dosilicon's Q3 revenue increased by 27.03% year-on-year, gross margin significantly improved, and net loss narrowed to 35.22 million yuan | Financial Report Insights

Dongxin Technology's Q3 revenue increased by 27.03% year-on-year and 14.35% quarter-on-quarter, with a gross profit margin up by 10.57 percentage points to 26.64%, indicating a recovery in industry prosperity and effective sales promotion by the company. However, the company is still in a loss position, with a net profit attributable to shareholders of -35.22 million yuan in Q3, accumulating a loss of 146 million yuan in the first three quarters.

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

• Operating revenue was 229.6 million yuan, an increase of 27.03% year-on-year and 14.35% quarter-on-quarter, achieving sequential growth within the year.
• The 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.
• The gross profit margin increased by 10.57 percentage points year-on-year to 26.64%.

Revenue and Gross Profit Both Increase, Industry Recovery Evident

According to the financial report, the improvement in Dongxin Semiconductor's performance in the third quarter was mainly driven by the dual increase in revenue and gross profit margin. The company achieved operating revenue of 229.6 million yuan in the quarter, an increase of 27.03% year-on-year and 14.35% quarter-on-quarter, achieving sequential growth within the year.

The company attributes this to several key factors: first, the overall recovery in the semiconductor design industry has driven a rebound in downstream market demand; second, the sales volume of products in key application areas such as network communication, security monitoring, and consumer electronics has seen significant year-on-year growth.

Additionally, with the market recovery, the sales prices of some products have rebounded. The company stated that through continuous optimization of product structure and market strategy, improving operational efficiency, and reducing product costs, its gross profit margin has effectively improved from 16.07% (adjusted data) in the same period last year to 26.64% in this report period.

R&D and Investment Pressure Profitability

The financial report shows that the company still faces pressure on the cost and investment side. During the reporting period, the total R&D expenditure reached 57.07 million yuan, an increase of 9.31% year-on-year. The company stated that R&D expenses are mainly used to maintain high-level investment in the storage sector to promote the upgrade of storage chip processes, while its Wi-Fi chip products are still in the R&D stage and have not yet generated revenue.

On the other hand, external investments have also directly impacted the current profits. The company confirmed an investment loss of 15.84 million yuan in its associate company, Lishuan Technology (Shanghai) Co., Ltd., which is one of the important factors leading to this quarter's loss. After deducting non-recurring gains and losses, the company's net loss in the third quarter was 39.98 million yuan, narrowing from a loss of 53.56 million yuan in the same period last year.

In the first three quarters, the net cash flow generated from operating activities was -168 million yuan, significantly improving compared to a net outflow of -244 million yuan in the same period last year. This improvement is mainly due to the increase in cash receipts from sales driven by revenue growth. As of the end of the reporting period, the company's inventory book value reached 1.004 billion yuan, an increase of 12.5% from 892 million yuan at the end of 2024

Promoting the "Storage, Computing, and Networking" Strategy with Parallel Layout and Incentives

To advance its integrated "Storage, Computing, and Networking" strategy, Dongxin Semiconductor has taken several important measures during and outside the reporting period. The company recently announced plans to increase its investment in Lishuan Technology (Shanghai) Co., Ltd. by approximately 211 million yuan of its own funds, and after the capital increase, it is expected to hold about 35.87% of the equity.

To attract and retain core talent, the company has also launched a restricted stock and stock appreciation rights incentive plan for 2025. According to the announcement, the company granted approximately 900,000 restricted shares to 141 incentive targets on October 16, and granted 324,000 stock appreciation rights to 7 incentive targets, aiming to deeply bind the interests of shareholders, the company, and the core team