While waiting for its listing on the Science and Technology Innovation Board, Ruishi Chuangxin, a domestic RF front-end chip and module manufacturer, suddenly "suspended" its IPO review.
The Shanghai Stock Exchange updated the latest IPO review status of Ruishi Chuangxin at the end of March. The information showed that since the financial information recorded in Ruishi Chuangxin's IPO documents has expired and needs to be supplemented, its review status has been temporarily changed to "suspended." According to the previously announced prospectus, the deadline for the financial data previously submitted by Ruishi Chuangxin is the end of June 2025. According to the requirements, Ruishi Chuangxin needs to provide financial data for the whole year of 2025.
Founded in 2017, Ruishi Chuangxin is one of the domestic companies that currently builds its own factories in the field of highly integrated filter modules. According to the prospectus, one of the purposes of the company's fundraising on the Science and Technology Innovation Board is to use it for the second phase construction project of the MEMS device production base to carry out iterative upgrades of filter products and expand market share.
In communication systems, filters are mainly used to filter out or weaken noise, interference, etc. in input signals and extract useful signals. They are a key segment in RF front-end chips and are widely used in application scenarios such as smartphones, drones, satellite communications, the Internet of Things, and smart wearable devices.
Until the end of 2024, the world's five giant companies, represented by Qualcomm, Broadcom, Murata, etc., still occupy more than 70% of the global market share. However, domestic RF front-end companies have long lingered in the field of mid-to-low-end discrete devices, and high-end filters are almost completely dependent on imports.
Against this background, Ruishi Chuangxin aims at the domestic high-integration market and takes self-developed and self-produced filters as the main breakthrough point as an important part of "domestic substitution" in the chip field.
This corporate layout is also favored by leading manufacturers. According to the shareholder list published in the prospectus, OPPO and Hubble Investment, which is backed by Huawei, are the company’s fourth and fifth largest shareholders. In terms of mobile phone manufacturers, Ruishi Chuangxin has also entered the supply chain system of global mainstream mobile phone brands including OPPO, Xiaomi, vivo, Honor, Samsung, Transsion and so on.
At the same time, Ruishi Chuangxin will implement a price reduction strategy for its core product 5G radio frequency front-end module in 2024, and the gross profit margin of this product will drop by 11.90 percentage points. As of the first half of 2025, the company's net profit has not yet turned around, and its undistributed book profit is -1.68 billion yuan. With deep accumulated losses, profitability risks may be difficult to ignore.
From 2022 to the first half of 2025 (hereinafter referred to as the "reporting period"), Ruishi Chuangxin's comprehensive gross profit margin was only 7.95%, 13.90%, 8.79%, and 9.79%, while the average gross profit margins of comparable companies during the same period were 26.31%, 23.49%, 20.90%, and 21.09% respectively. Ruishi Chuangxin's gross profit margin was less than half of that of comparable companies in the same industry in China.
Although Xinchuang's opportunity for domestic substitution provides a window for corporate development, market research institutions predict that global smartphone shipments will drop significantly, which will put sales pressure on related component manufacturing companies. How to find a balance between favorable policies and market pressure is testing the business wisdom of domestic technology innovation companies, including Ruishi Chuangxin.
Heavy warehouse investment filter
Judging from the company's development history, Ruishi Chuangxin is a typical high-tech innovative enterprise. Ni Jianxing, the company's founder and controlling shareholder, is 42 years old and a "post-80s generation". After graduating from the University of Electronic Science and Technology of China in 2005, majoring in microelectronics, he went to Iowa State University in the United States to pursue a graduate degree in electrical engineering. After graduation, he worked in world-renowned semiconductor companies such as Motorola Solutions, Inc. and Skyworks.
After leaving Sijiaxun, Ni Jianxing founded Ruishi Chuangxin. Since his establishment, in addition to serving as the company's chairman, general manager and actual controller, Ni Jianxing also serves as the head of the company's R&D department.
The R&D, design, manufacturing and sales of RF front-end modules and RF discrete devices are the main business of Ruishi Chuangxin. RF front-end modules and RF discrete devices for 5G, 4G, drones, and satellite communications are the company's main products.
Different from a single-link R&D and design company, Ruishi Chuangxin has a relatively complete product and technology layout, covering all categories of core RF devices such as RF filters (including duplexers, multiplexers, and SAW Banks), power amplifiers, RF switches, and low-noise amplifiers.
It is worth noting that investment in RF filters accounts for a large proportion of the development process of Ruishi Chuangxin. In 2019, Ruishi Chuangxin, which had just been established for 2 years, signed a contract to establish a filter production base in Chongqing. Such a significant investment, for a start-up company, seemed quite "radical" in the industry at the time.
However, judging from the development paths of global giants, investing in and building filter production lines is the only way for RF front-end module companies to develop. When a design company develops to a certain stage, it will inevitably need to merge or invest in a filter company to achieve a high degree of module integration.
With the production base put into operation in 2024, Ruishi Chuangxin has also transformed from the pure design (Fabless) model at the beginning of its establishment to a "Fab-lite" model.
At the same time, this also makes Ruishi Chuangxin the second company in China that has built its own filter factory and has the capability of highly integrated RF front-end modules. Prior to this, the first company to achieve self-production of filters + module integration was Zhuosheng Micro, which was launched in 2019.
Therefore, the production base with self-production capabilities has become one of the important advantages that differentiates Ruishi Chuangxin from other similar domestic RF front-end companies. Among the financing purposes of this listing, the investment and construction of the second phase of the production base is an important financing purpose.
The announcement shows that Ruishi Chuangxin’s total fundraising scale is approximately 810 million yuan, of which 369 million yuan is planned for the second phase construction project of the MEMS device production base, 330 million yuan is expected to be invested in the R&D center construction project, and another 110 million yuan is used to supplement working capital.
The prospectus mentioned that the second phase of the project will be used to expand the company's production capacity of SAW, TC-SAW, ML-SAW (POI substrate) and other filters. The produced filters will be combined with the company's existing PA, LNA and RF switch technologies to bring synergy to the company's highly integrated RF front-end modules.
As the industry's "involution" intensifies, how to make profits?
It should be pointed out that, similar to many technology entrepreneurial companies, Ruishi Chuangxin has not yet achieved profitability at least by the end of June 2025.
The prospectus shows that during the reporting period (January-June 2022 to 2025), Ruishi Chuangxin’s revenue scale was 370 million yuan, 649 million yuan, 669 million yuan, and 377 million yuan respectively, of which the revenue in three complete fiscal years The compound growth rate reached 34.43%; in terms of net profit performance, they were -328 million yuan, -328 million yuan, -353 million yuan, and -148 million yuan respectively during the period. The cumulative net loss in three and a half years was 1.157 billion yuan.
Regarding the loss, Ruishi Chuangxin explained that it was due to factors such as large R&D investment during the period, low product gross profit margin, and large share-based payment expenses. And due to the high technical barriers, long R&D cycles, and strict product certification and customer introduction processes in the RF front-end industry, the company expects to continue to maintain high R&D investment in the short term.
Judging from the scale of losses, the company's losses will tend to narrow in 2025, and the gross profit margin will show a certain rebound in the financial report for the first half of 2025. In addition, while the gross profit margin of the company's main products, 5G and 4G radio frequency front-end modules, has dropped to less than 10%, the gross profit margin of drone radio frequency front-end modules has reached more than 27%, which has played a certain role in boosting the company's overall gross profit margin level.
In contrast, Onrui Micro, another RF front-end company that just went public at the end of last year, has a more eye-catching financial performance. The announcement shows that by the end of 2024, the company's revenue has reached 2.1 billion yuan. At the same time, in the three and a half years from 2022 to 2025, the cumulative net loss was 840 million yuan, and the scale of the loss was even smaller.
In terms of corporate strategy, Onrui Micro mainly adopts the foundry method, and its business model appears to be more "light", which provides conditions for the company to achieve profitability faster. Ruishi Chuangxin, which chose to invest in the construction of a production line, in addition to having heavier assets, has also realized a full-chain closed loop of "chip design + filter manufacturing + module packaging and testing", making it technically more "hard-core".
This reflects, to a certain extent, the fierce competition among domestic RF front-end companies. At the same time, the unsatisfactory gross profit margin levels of the two companies also reflect that the price involution in the RF front-end market, especially the mid- to low-end market, has reached a fever pitch.
In fact, starting from the second half of 2024, leading companies in the RF front-end industry will generally experience performance pressure. In the 2025 financial report of domestic industry leader Zhuosheng Micro, it suffered its first loss since its listing. Although Huizhi Micro has increased revenue, it has not yet turned a loss. Ongrui Micro's latest financial report also shows that both revenue and profit are under pressure.
Industry analysts believe that the RF front-end is showing a "low-end red ocean and high-end blue ocean" situation. The low-end RF market has generally reduced gross profit margins due to overcapacity, while the high-end market is monopolized by international giants and is in short supply.
According to Yole's forecast, the global RF front-end market will exceed US$17 billion by 2030. By then, the global share of domestic manufacturers is expected to increase from the current 15% to 30%. The growth space will mainly come from high-end module replacement.
Therefore, moving from low-end to high-end is an inevitable demand for domestic substitution. What needs to be focused on is not only the company's breakthroughs in key technologies and processes, but also the process of upgrading the entire industrial chain.
Some industry insiders pointed out that the large initial investment in self-built filter factories will put pressure on the company's profit performance: "In fact, the industry currently has overcapacity in low-end products, and the cost of self-produced products may not be more advantageous. But the most important thing about having production capacity is not only cost considerations, but also in the process of upgrading from low-end to high-end R&D, technology can be independently controllable, production capacity is guaranteed, and it can meet the customized needs of enterprises. The significance of this aspect may be more important to enterprises."
Because of this, domestic RF front-end companies are forced to break through to the high-end market, and the demand for domestic substitution has also "teared" a hole in the market that is still occupied by international giants, and this is also the direction that Ruishi Chuangxin is aiming at.
It is worth mentioning that adjusting to the Fab-lite model is also the transformation direction of leading companies like Zhuo Shengwei. The current transformation process is also an important factor that put pressure on its performance last year. This situation of performance pressure is similar to that of Ruishi Chuangxin, which has invested heavily from the beginning.
The “dangers” and “opportunities” brought about by geopolitical conflicts
Industry investors revealed that due to the intensification of geopolitical conflicts this year, many domestic terminal equipment companies are worried about the "stuck neck" problem, and their demand for domestic components has become urgent: "On the one hand, some equipment companies are focusing on seeking alternatives on the domestic manufacturing side. On the other hand, some companies are required to complete their wafer customization needs in advance, all of which are preparing for supply cuts that may be caused by international trade frictions."
From the perspective of the development of the RF front-end industry, the uncertainty caused by geopolitical friction is a "double-edged sword." On the one hand, international conflicts make domestic and foreign companies tend to make “conservative” choices. In the domestic market, it forces many domestic equipment companies to shift component demand from international to domestic, objectively providing development opportunities for domestic companies.
In the international market, the merger of two industry giants, Skyworks and Qorvo, in November last year also shocked the industry. According to analysis by industry insiders, the intention of the merger between the two parties is not to rule out that it is to secure the more profitable Apple and military markets, so that there will be some spillover markets for mid-range products for other rivals to share.
On the other hand, institutions predict that smartphone shipments will decline globally, which will reduce the total demand for components by terminal companies. Counterpoint, a third-party market research organization, has predicted that global smartphone shipments will decline by about 12% to 12.4% year-on-year in 2026, slightly less than 1.1 billion units, which will be the lowest annual sales volume in the past 13 years.
As for the reason for the decline, Counterpoint cited the storage price crisis. As a result, the low-end market, where storage accounts for a higher proportion of the total machine cost, will be hardest hit, while the high-end price segment with a wholesale price of over US$700 may be one of the few markets that can achieve small growth.
Therefore, the low-end market will enter the stage of "bayonet seeing red", and iterating to the high-end market is not only the transformation direction of terminal equipment companies, but also the inevitable path for component equipment companies. The only difference lies in whether technological breakthroughs and the overall level of the industrial chain can meet the needs of iteration – these are precisely the greater tests for Ruishi Chuangxin, which is on the verge of listing.
