Luxshare Precision Industry Co., Ltd. is transitioning from its traditional role as a leading supplier in the "Apple supply chain" to becoming a core provider in the "AI supply chain," securing partnerships with global tech giants such as OpenAI, Apple, Meta, and Google.
On February 27, 2026, Luxshare Precision Industry Co., Ltd. formally submitted a listing application to the Hong Kong Stock Exchange once again. CITIC Securities, Goldman Sachs, and CICC are acting as joint sponsors.
The company had initially disclosed its H-share prospectus as early as August 18, 2025, which subsequently lapsed on February 18, 2026.
Alongside the filing, Luxshare has been active in recent corporate moves. On February 23, the company announced it had completed its first-ever share repurchase since listing, conducted through a centralized bidding method on February 13. The buyback involved 9.9006 million shares, with a total transaction value of nearly 500 million yuan. The repurchase price ranged from 50.14 yuan to 50.91 yuan per share, and all repurchased shares will be used for employee stock ownership plans or equity incentives.
On February 26, Luxshare's new-generation AI terminal project, with a total investment exceeding 10 billion yuan, commenced construction in Kunshan, Suzhou. The project, which focuses on high-value computing hardware like AI servers and AI PCs, has been included in Jiangsu Province's 2026 major projects list. Upon reaching full production capacity, its annual output value is projected to surpass 100 billion yuan.
This company, which initially grew by being part of the "Apple supply chain," has now surpassed its former benchmark, industry giant Foxconn, in its core business areas. However, the secondary market appears to hold a different view. Star fund manager Xie Zhiyu reduced his holdings in Luxshare by approximately 34.4082 million shares (a 43% reduction) in the fourth quarter of 2025, with his three main funds all participating in the sell-off.
Veteran fund manager Zhu Shaoxing of Fullgoal Fund also reduced his holdings in Luxshare during the same period, causing the stock to drop out of the top ten holdings of the Fullgoal Tianhui Select Growth fund. Notably, as of the latest update, Luxshare's A-share price has fallen over 30% from its peak of 72.04 yuan per share on September 24, 2025, to 50.22 yuan per share on February 27, 2026.
**Surpassing Foxconn**
Luxshare Precision started in consumer electronics precision manufacturing. Through its integrated layout spanning "precision components, modules, to system assembly," it has not only secured partnerships with tech giants like Apple but has also overtaken Foxconn in supplying key products.
According to the prospectus, the company's revenue for 2022-2024 was 214.028 billion yuan, 231.905 billion yuan, and 268.795 billion yuan, respectively, with profits growing from 10.5 billion yuan and 12.2 billion yuan to 14.6 billion yuan. For the first three quarters of 2025, revenue reached 220.9 billion yuan, with profit increasing 30.1% year-on-year to 12.7 billion yuan.
The connection between Luxshare and Foxconn dates back to 1988, when founder Wang Laichun, at age 21, became one of the first female workers at Foxconn's facility in Shenzhen. She worked at Foxconn for over a decade, rising from an assembly line worker to a section chief managing thousands of people—the highest position a mainland Chinese employee could attain in a Taiwanese company at the time.
In 2004, Wang Laichun founded Luxshare Precision. Initially relying on Foxconn as a key customer, the company gradually expanded into the broader electronics manufacturing market through deep technical expertise in connectors and flexible service response, eventually successfully entering the Apple supply chain.
Starting with iPad connector cables, Luxshare made a significant breakthrough around 2017 by securing the contract to manufacture AirPods, transforming from a peripheral supplier to a core partner of Apple. In the AirPods series, Luxshare holds over 60% of the global manufacturing share, establishing absolute dominance. For Apple Watch structural components and wireless charging modules, its market share exceeds 50%, significantly领先 Foxconn's approximately 25%. In supplying core components like iPhone connectors and acoustic modules, Luxshare holds a 35% share, surpassing Foxconn's 28% to become the top supplier in this segment.
Furthermore, Luxshare secured orders for core structural components, thermal modules, and sensors for Apple's Vision Pro mixed reality headset (with a unit value of approximately 12,000 yuan), while Foxconn is only involved in partial assembly.
Foxconn's Apple supply chain business remains focused on whole-unit assembly, holding about 60% of iPhone assembly share in 2024. However, this business has a gross margin of only 3%-5% and faces pressure from Apple's strategy to diversify its supply chain. In contrast, Luxshare, with its full-chain service capability covering components, modules, and assembly, maintains a gross margin of 10%-12% within the Apple supply chain, higher than Foxconn's assembly business.
A milestone achievement is that Luxshare has historically surpassed Foxconn in Apple's core whole-unit assembly business. During the mass production cycle for the iPhone 17 series in 2025, Luxshare became Apple's largest assembler with approximately 45% of the assembly share, while Foxconn retreated to second place with about 35%. Specifically, for the standard iPhone 17/Plus models, Luxshare secured 60% of the assembly orders, and its share also increased for the higher-margin Pro series models.
According to the prospectus, Luxshare's consumer electronics business covers four main product categories: structural components, functional components, electronic components, and system assembly. In 2024, revenue from consumer electronics products and solutions reached 233.1 billion yuan, accounting for 86.7% of total revenue. The company ranks second globally and first in mainland China in the global market for precision manufacturing solutions for consumer electronic components and modules, with an 11.3% market share. In the first half of 2025, Luxshare's total revenue was 124.503 billion yuan, with consumer electronics contributing 97.799 billion yuan, representing 78.55% of total revenue.
Notably, Luxshare has built a global production and supply chain network covering Asia, Europe, the Americas, and Africa. As of September 30, 2025, it operated 105 production bases worldwide, primarily located in China, Vietnam, Mexico, Germany, and Poland.
**The "Second Curve"**
Beyond consumer electronics, Luxshare is also expanding into emerging fields such as automotive electronics, data centers, and AI endpoint devices. Automotive electronics is currently its fastest-growing core business. The prospectus shows that from 2022 to September 2025, the revenue contribution from automotive electronics continuously increased from 6.0% to 10.7%. In 2024, revenue from this segment reached 18.36 billion yuan, a 26.5% year-on-year increase.
In terms of products, Luxshare ranks fourth globally and first in mainland China in the global automotive wiring harness precision manufacturing solutions market, with an 11.9% market share. In July 2025, the company completed the acquisition of relevant assets from Leoni AG, the largest automotive wiring harness manufacturer in Europe and fourth globally. Post-acquisition, Luxshare's global market share in automotive wiring harnesses increased to over 15%, making it the world's third-largest supplier.
In the smart driving domain, Luxshare has achieved mass production of several mid-to-high-end domain controller products based on 100 TOPS and plans to volume-supply high-end products exceeding 500 TOPS between 2026 and 2027. Related products have already received orders from new automakers like Xpeng, Li Auto, and Nio, as well as traditional automakers.
Additionally, during a multi-institutional调研 in November 2025, Luxshare indicated that it expects significant growth elasticity in its data center AI computing business segments in 2026, with AI endpoint consumer electronics business accelerating in the second half of 2026.
In the data center business, Luxshare focuses on core products like high-speed interconnects and liquid cooling, entering the supply chains of global tech giants such as NVIDIA, Google, and Amazon. According to the prospectus, in the first half of 2025, revenue from the communication and data center business was 11.098 billion yuan, a 48.65% year-on-year increase.
In high-speed interconnect products, Luxshare is the exclusive supplier of 224G high-speed copper cables for NVIDIA's GB200/GB300 servers, with a unit value of about 8,000 yuan. Order volume for 2026 is projected to exceed 500,000 units, generating related revenue of over 4 billion yuan.
Liquid cooling is another growth area within Luxshare's data center segment. Its gravity-enhanced immersion liquid cooling solution has been deployed in Alibaba data centers, offering advantages like higher cooling efficiency and lower energy consumption compared to traditional air cooling. As AI server power consumption continues to rise, the penetration rate of liquid cooling is growing rapidly. An Oriental Securities research report estimates the global penetration rate of data center liquid cooling will increase to around 30% by 2026. Sources predict Luxshare's liquid cooling business revenue could exceed 5 billion yuan in 2025.
In the AI endpoint domain, Luxshare is focusing on consumer-grade AI hardware and has secured several orders. In September 2025, AI giant OpenAI signed an agreement with Luxshare to jointly develop a consumer-grade AI device, expected to launch as early as late 2026 or early 2027.
With AI glasses becoming a new trend in smart wearables, Luxshare has also made extensive布局, supplying precision structural components and acoustic modules for AI glasses products from tech giants like Meta and Google.
By partnering with OpenAI, Apple, Meta, Google, and other global tech leaders, Luxshare is transitioning from a traditional "Apple chain" leader to a core "AI chain" supplier. Whether it can continue to command a premium in the engineering manufacturing and ecosystem collaboration of AI hardware will be a key focus for the market.
**Financial Concerns**
Despite achieving leapfrog development in its operations, Luxshare's financial reports still reveal underlying risks and challenges.
Excessively high customer concentration is its most prominent financial risk. The prospectus discloses that from 2022-2024 and the first nine months of 2025, revenue from the top five customers accounted for 83.1%, 82.4%, 78.5%, and 65.0% of total revenue, respectively. Revenue from the largest customer (Apple) accounted for 73.3%, 75.2%, 70.7%, and 56.3%, respectively. Although the share from the largest customer has declined year-on-year, it still constitutes over half of total revenue. Any future adjustments by Apple to its supply chain, product price reductions, or order cuts could significantly impact Luxshare's revenue and profits.
Persistent pressure on gross margins is another issue. From 2022 to 2024, the overall gross margin was 11.9%, 11.1%, and 10.1%, respectively, showing a year-on-year declining trend. For the core consumer electronics segment, the gross margin was only 10.5% in 2024.
Luxshare's asset-liability structure and liquidity also warrant attention. Before 2021, its asset-liability ratio remained below 60% for many years. From 2021-2024, it climbed to around 62%, and by the end of September 2025, it had further increased to 67.01%, significantly higher than peers like Foxconn Industrial Internet and Lens Technology.
In terms of debt structure, the proportion of medium- to long-term debt has been increasing. In 2024, the scale of long-term borrowings reached 19.62 billion yuan, accounting for 14.1% of total liabilities, a significant increase from 1.5 billion yuan in 2021.
Regarding cash flow, Luxshare's net cash outflow from investing activities was 35.656 billion yuan in 2024, while net cash flow from operating activities was only 3.478 billion yuan, forcing reliance on external financing to cover the cash flow gap. In 2024, cash received from borrowing hit a record high of 91.709 billion yuan since listing. This cycle of "heavy borrowing and repayment" has increased financial expenses, which reached 1.463 billion yuan in 2024, becoming a significant factor contributing to the decline in net profit margin.
Insufficient R&D investment is another challenge Luxshare must address during its expansion. R&D expenses for 2022-2024 and the first nine months of 2025 were 8.447 billion yuan, 8.189 billion yuan, 8.556 billion yuan, and 8.170 billion yuan, respectively. However, as revenue expanded rapidly, the ratio of R&D investment to total revenue continued to decline, dropping to 3.2% in 2024, slightly lower than some industry peers. In high-tech barrier sectors, insufficient R&D investment could hinder technological breakthroughs, creating uncertainty about whether it can support new businesses in securing leading positions within their industries.
Comments