On the evening of March 27, 2026, Sicc Co., Ltd. released its 2025 annual report. The company reported annual revenue of 1.465 billion yuan, a decrease of 17.15% year-over-year, and a net profit loss attributable to shareholders of 208 million yuan, shifting from profit to loss.
Despite the reported losses, the market reaction to the annual report was notably positive. The company's stock price rose for three consecutive trading days following the release, with a cumulative increase of 10.94% by the close on April 1.
Analysis of major financial forums indicates that bullish investors are primarily focused on production and sales volume data. In 2025, the company's production of silicon carbide substrates reached 690,400 units, a year-over-year increase of 68.31%, while sales volume was 633,300 units, up 54.90% compared to the previous year.
The company attributed the decline in performance mainly to a decrease in the average selling price of its silicon carbide substrate products, which led to lower revenue and gross profit. This was compounded by increases in sales and research expenses, as well as higher income tax expenses and late payment penalties.
Calculating the price per unit using the formula "segment revenue from silicon carbide substrates / sales volume," the unit price for Sicc Co., Ltd.'s silicon carbide substrates fell from 4,080 yuan per unit in 2024 to 2,304 yuan per unit in 2025, representing a sharp price decline of 56%.
Whether this price drop was a strategic move to capture market share or a forced response to competitive pressures, the magnitude of the decrease is severe. Coupled with the news of Wolfspeed, a global pioneer and dominant leader in silicon carbide, filing for bankruptcy, the silicon carbide substrate market in 2025 was characterized by intense competition.
In recent years, fierce price wars have erupted in downstream sectors. Rival Tanke Teda has also been reporting losses for multiple years.
Silicon Carbide (SiC), as a typical third-generation semiconductor material, offers advantages such as a wide bandgap, high breakdown electric field, and high thermal conductivity compared to traditional silicon-based (first-generation) and gallium arsenide/indium phosphide compound (second-generation) semiconductors. It is considered an ideal material for high-voltage, high-temperature, and high-frequency applications and is currently used primarily in various industrial settings.
According to Frost & Sullivan estimates, xEVs (encompassing electric and hybrid vehicles, broadly referred to as new energy vehicles) are and will remain the primary application field for silicon carbide for the next five years, consistently accounting for over 70% of the market space.
However, in recent years, competition among new energy vehicle manufacturers has intensified. The price war in the automotive market in 2025 was particularly aggressive, with various trade-in subsidies, scrappage subsidies, and manufacturer subsidies layering on top of each other, leading to unprecedented low prices for many models. Combined with rising raw material costs and tightening cost constraints for new energy vehicle makers, the upstream silicon carbide industry inevitably felt the impact.
According to securities firm research reports, the leading domestic suppliers of N-type silicon carbide substrates are primarily Sicc Co., Ltd. and Tanke Teda. Their respective global market shares are 17.3% and 17.1%, totaling 34.4%, which has surpassed Wolfspeed, previously the top global silicon carbide substrate company.
Yet, as the price war deepened in 2025, while Sicc Co., Ltd. reported a net loss again, its competitor Tanke Teda also faced significant challenges.
Tanke Teda, fully named Beijing Tanke Teda Semiconductor Co., Ltd., was established in September 2006 by Xinjiang Tianfu Group and the Institute of Physics of the Chinese Academy of Sciences. Founded four years earlier than Sicc Co., Ltd., it was one of the earliest Chinese enterprises engaged in silicon carbide semiconductor-related research and development.
Tanke Teda listed on the New Third Board in May 2017 and delisted in August 2019. Subsequently, it attempted an IPO on the STAR Market. Its application was accepted by the Shanghai Stock Exchange in July 2020 but was terminated in October 2020, halting its listing plans.
Financial data disclosed during its listing attempt showed that while its revenue from 2018 to 2019 was lower than Sicc Co., Ltd.'s, it was profitable. In 2019, its net profit attributable to shareholders was 30.04 million yuan, whereas Sicc Co., Ltd. reported a loss of 201 million yuan for the same period.
There are indications that Tanke Teda may have fallen into consecutive years of losses recently.
According to the financial reports of Tianfu Energy, Tanke Teda's second-largest shareholder, the profit or loss recognized under the equity method for its long-term equity investment in Tanke Teda from 2022 to the first half of 2025 was -6.6 million yuan, 8.36 million yuan, -19.49 million yuan, and -14.09 million yuan, respectively. During this period, Tianfu Energy consistently held a 9.09% stake in Tanke Teda. This implies that Tanke Teda's approximate profits for the respective periods were -72.63 million yuan, 91.94 million yuan, -214 million yuan, and -155 million yuan. It was profitable in only one year over this three-and-a-half-year span, with recent annual losses exceeding hundreds of millions, indicating significant financial strain.
In May 2025, U.S. media reported that Wolfspeed was working with bankruptcy advisors and preparing to file for bankruptcy protection within weeks to address its substantial debt issues.
Following this disclosure, Wolfspeed's stock price plummeted 60% overnight, ranking it at the top of the list of biggest decliners on U.S. stock markets.
Wolfspeed's predecessor, Cree, was founded in 1987. Initially focused on silicon carbide-based blue LED products, it later launched the world's first commercial silicon carbide wafer, earning a reputation as a pioneer in silicon carbide.
As its lighting business gradually declined, Cree spun off its LED business in 2016 and officially changed its name to Wolfspeed in October 2021, transforming entirely into a company focused on third-generation semiconductors.
Between 2021 and 2024, Wolfspeed engaged in significant factory expansion. This move, however, coincided with slower-than-expected electrification in the European and American automotive markets. Orders from automotive clients decreased substantially, turning its capacity advantage into a burden of depreciation. Faced with persistent heavy losses, Wolfspeed ultimately announced the initiation of bankruptcy restructuring proceedings.
Some market observers believe that silicon carbide substrate products suffer from high homogenization, easily leading to price competition. The price advantage of Chinese manufacturers in the global competition is considered a significant factor contributing to Wolfspeed's inability to cover costs and subsequent bankruptcy.
Wolfspeed's current poor performance and contraction in capacity utilization will further impact economies of scale, driving up costs and consequently weakening the price competitiveness of its products. This situation may present an opportunity for Chinese manufacturers to reshape the competitive landscape of the global silicon carbide substrate market.
On another front, the Chinese new energy vehicle market has recently undergone a strategic reversal. Automakers who adhered to a "volume-for-price" strategy in recent years have begun collectively raising prices.
According to incomplete statistics, as of March 29, 2026, more than 15 new energy vehicle manufacturers have announced price increases or reduced discounts, with hikes ranging from 2,000 to 20,000 yuan.
Reports indicate that the main price increases, around 3% to 5%, are concentrated in the volume-driven 100,000 to 200,000 yuan market segment. The 200,000 to 300,000 yuan segment saw increases of 2% to 4%, while the premium market above 300,000 yuan experienced hikes of 1% to 3%. Entry-level vehicles below 100,000 yuan maintained discounts, continuing a volume-driven strategy.
It is noteworthy that various factors suggest this round of price adjustments is primarily driven by cost pressures.
Recent sharp increases in lithium prices are estimated by UBS to add 3,000 to 5,000 yuan to vehicle costs. Additionally, AI demand is significantly squeezing capacity for automotive-grade chips, with memory chips driving up intelligentization costs by 2,000 to 3,000 yuan per vehicle. Simultaneously, the phase-out of the purchase tax exemption for new energy vehicles and tightening local subsidies mean that price hikes by automakers appear to be a necessary measure to protect profit margins.
In this context, the future direction for silicon carbide companies, already facing halved product prices, remains uncertain. Time will tell what answers emerge.
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