FOURSEMI has commenced its public offering after confidentially submitting its application and passing the Hong Kong Stock Exchange hearing. The subscription period for the Hong Kong IPO ended on March 26, with trading on the main board scheduled to begin on March 31. Guotai Junan and Orient Securities International are acting as joint sponsors, with no cornerstone investors participating in the offering.
The company plans to issue 12 million shares globally, with a price range set between HK$40 and HK$50 per share. Each board lot consists of 100 shares, requiring a minimum subscription amount of HK$5,050. The maximum fundraising amount could reach HK$600 million.
Despite being a manufacturer focused on perception-intelligent audio chips and achieving total shipments exceeding 470 million units in 2024, with major clients including Samsung, Xiaomi, and vivo in the consumer electronics and automotive sectors, the company has yet to achieve profitability.
FOURSEMI's recent growth trajectory exemplifies a classic strategy of trading price for volume. Founded in 2016, the company rapidly ascended to a leading position in global market share for amplifier audio chips through aggressive market strategies. In 2024, FOURSEMI shipped 460 million amplifier audio chips worldwide. According to a Frost & Sullivan report, this places the company third globally and third in China within this specific segment, trailing the leader by approximately 4.7% in market share.
However, this rapid sales growth has been accompanied by thin margins and sustained losses. To quickly capture market share, FOURSEMI significantly reduced its product prices. In 2023, the average price of its low-power audio chips dropped sharply from 1.08 yuan to 0.66 yuan, while the average selling price of its adaptive power control audio chips fell from 0.91 yuan to 0.56 yuan. Consequently, the gross profit margin declined from 17% in 2022 to 2.7%.
The company stated in its prospectus that audio chip prices in China showed a downward trend between 2020 and 2023, primarily due to industry-wide inventory adjustments. These adjustments are expected to be largely complete after 2024. Audio chip prices are forecast to stabilize and begin a gradual recovery starting in 2025. By 2029, the average chip price is projected to rebound to 1.3 yuan per unit.
Furthermore, the company's overall gross margin has been volatile in recent years. For the periods covering 2022, 2023, 2024, and the first ten months of 2025, the gross margins were 7.3%, -0.1%, 13.1%, and 20%, respectively.
Although the gross margin is expected to continue improving, the company remains loss-making. It recorded losses in 2022, 2023, and 2024. For the first ten months of 2025, it reported a loss of approximately 51.78 million yuan, an increase compared to the same period in 2024. The company attributed this to higher administrative expenses, including one-time listing costs, and increased financial costs related to business expansion.
Notably, on March 16, the day after FOURSEMI passed its hearing, a peer company, Awinic, filed a lawsuit alleging patent infringement. The court hearing is scheduled for April 27, with FOURSEMI named as the defendant in the first-instance civil case. Records indicate this is currently the only judicial case involving FOURSEMI.
The founding story of FOURSEMI began with a professional relationship forged at a major semiconductor firm. The company's founder and board chairman, Xu Xiaolin, and the vice president and director of algorithm applications, Liu Baoliang, both previously worked at NXP Semiconductors (Shanghai) Co., Ltd., a subsidiary of the Nasdaq-listed NXP Semiconductors N.V. The two collaborated for many years, including a three-year period as direct colleagues. In 2016, as the wave of domestic substitution in China's semiconductor industry began, Xu and Liu almost simultaneously left the international giant and soon established FOURSEMI.
Since its founding, FOURSEMI has completed 11 rounds of financing, attracting prominent financial and industrial investors such as Fortune Capital, the National Integrated Circuit Industry Investment Fund's Beyond Moore Fund, Transsion Holdings, and Longcheer Technology. The post-money valuation following the latest Series D financing was approximately 2.775 billion yuan.
According to the latest IPO details, FOURSEMI did not secure any cornerstone investors for its Hong Kong listing.
Based on the median offer price of HK$45, and assuming the over-allotment option is not exercised, FOURSEMI expects to raise net proceeds of approximately HK$480 million. The funds will be primarily allocated to building a research and development center, procuring automated testing equipment, hiring supply chain management engineers, product marketing, and working capital. Specifically, 46.8% of the proceeds will be used over the next five years to establish a new R&D center to enhance capabilities in amplifier audio chip development.
Beyond consolidating its position in the mobile phone market, FOURSEMI is accelerating its expansion into tablets, smartwatches, and the automotive sector. In the first ten months of 2025, products for the automotive field contributed their first profit, achieving a high gross margin of 47.4%, the highest among all its product categories.
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