On December 24, 2025, Xinhe Semiconductor Technology (Shanghai) Co., Ltd. (hereinafter referred to as "Xinhe Semiconductor") formally completed its IPO guidance process. CITIC Securities issued a report confirming that the company has established the necessary governance structure and compliance capabilities for a public listing, marking a significant milestone as this leading domestic EDA company enters the final sprint towards its market debut.
Financially, Xinhe Semiconductor achieved operating revenue of 265 million yuan in 2024, more than doubling the 106 million yuan revenue recorded in 2023. The company reported a net profit of 48.1282 million yuan, a notable turnaround from a loss in the previous year, demonstrating robust growth momentum and profitability. This impressive performance is attributed to the widespread application of its solutions across 5G communications, smartphones, the Internet of Things, artificial intelligence, and data centers, coupled with the increasing market recognition of its full-stack EDA solutions.
Xinhe Semiconductor's core product portfolio spans the entire chain from chips, packaging, and modules to PCB board-level, interconnects, and complete system-level solutions. It supports advanced packaging technologies like Chiplet and provides a critical toolchain for the design of high-speed, high-frequency intelligent electronic products. The company's independently developed Metis, a 3DIC Chiplet advanced packaging simulation platform, was awarded the CIIF prize at the China International Industry Fair in September 2025, standing as a landmark achievement for breakthroughs in domestic EDA technology.
The company's capital operations this year have been notably intensive. Xinhe Semiconductor initiated the filing for its A-share IPO guidance on February 7, and merely a month later, the leading domestic EDA firm Empyrean Technology Co.,Ltd. announced plans to acquire Xinhe Semiconductor's assets through a combination of share issuance and cash payment.
However, four months later, on July 9, the board of directors at Empyrean Technology deliberated and decided to terminate this major asset reorganization. The company's management later stated during an investor communication meeting that the involved parties failed to reach an agreement on core terms. Some media reports suggested that disagreements in such M&A transactions typically revolve around valuation and performance clauses, and Empyrean Technology's recent state of increasing revenue without corresponding profit growth might have impacted its bidding capability and willingness to pay.
Xinhe Semiconductor's firm choice to pursue an independent IPO perhaps reflects the strategic competition within the EDA market landscape. The domestic EDA market has long been dominated by foreign companies, with the three giants—Synopsys, Cadence, and Siemens EDA—collectively holding 74% of the global market share in 2024. As the international trade situation continues to evolve, the market is placing greater emphasis on the localization process of EDA tools. From 2018 to 2021, the localization rate of EDA in China increased from 6% to 11%.
By opting for an independent listing, Xinhe Semiconductor may be better positioned to maintain the uniqueness of its technological roadmap within an expanding market, allowing it to more proactively adjust its market strategy and seize early-mover advantages.
Note: This article incorporates AI-generated content. The views expressed herein are for reference only and do not constitute investment advice. Market investments carry risks; caution is advised.
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