Shanghai TopsRockets Technology Co., Ltd. (referred to as TopsRockets) has officially entered the inquiry phase for its IPO on the STAR Market, as disclosed on the Shanghai Stock Exchange's official website on February 11. Established in 2018, this cloud AI chip company progressed from IPO application acceptance on January 22 to the inquiry stage in approximately 20 days, attracting market attention due to the accelerated review pace.
As one of the "Four Domestic GPU Dragons," TopsRockets competes with listed peers such as Moore Threads, Muxi Shares, and Biren Technology. A successful listing on the STAR Market would bring all four domestic GPU leaders together in the capital markets.
According to the prospectus, TopsRockets aims to raise 6 billion yuan, primarily for the research, development, and industrialization of its fifth and sixth-generation AI chips, as well as projects related to advanced AI software and hardware collaboration.
Behind the rapid IPO progress, the prospectus clearly reveals the challenges faced by this hard-tech company during its high-growth phase: cumulative losses exceeding 50 billion yuan and heavy reliance on Tencent for revenue.
The profitability turning point has yet to arrive. In terms of growth performance, TopsRockets' revenue growth is notable. Prospectus data show that the company's revenue increased from 90 million yuan in 2022 to 722 million yuan in 2024, achieving a two-year compound annual growth rate of 183.15%. For the first three quarters of 2025, the company reported revenue of 540 million yuan.
The revenue structure has also undergone a critical transformation, shifting from early reliance on IP licensing to a core product portfolio centered on AI accelerator cards and modules, intelligent computing systems, and clusters. In the first three quarters of 2025, AI accelerator cards and modules accounted for 76.73% of revenue, indicating accelerated commercialization.
Technologically, over nearly eight years since its establishment, TopsRockets has independently developed and iterated five cloud AI chips across four generations of architecture, building a comprehensive product system that covers AI chips, accelerator cards, intelligent computing clusters, and its self-developed software platform, "TopsRider."
This high growth is built on sustained, substantial R&D investment. From 2022 to 2024, the company's cumulative R&D expenditure reached 3.529 billion yuan, with an R&D expense ratio consistently above 160%, far exceeding the industry average. High R&D spending directly led to continuous losses, with cumulative net losses attributable to shareholders reaching approximately 5.18 billion yuan during the reporting period.
Specifically, from 2022 to the first three quarters of 2025, the company's net losses attributable to shareholders were 1.116 billion yuan, 1.665 billion yuan, 1.51 billion yuan, and 888 million yuan, respectively. Although the loss narrowed in 2024 compared to 2023, the absolute value remains high, and the company has not yet reached breakeven.
Cash flow is another area of concern. During the reporting period, net cash flow from operating activities was consistently negative, with a cumulative net outflow of 4.764 billion yuan. This is primarily due to large advance payments made to ensure supply chain security, leading to continuous cash outflows.
From 2022 to the first three quarters of 2025, the company's prepayments balance was 111 million yuan, 204 million yuan, 128 million yuan, and 210 million yuan, respectively, indicating consistently high inventory needs. This situation makes the company heavily reliant on external financing to sustain operations. If future financing channels are constrained or collections fall short of expectations, the company could face significant liquidity pressure.
According to management disclosures, barring major changes in the external market environment, the company expects to reach its profitability turning point no earlier than 2026.
Heavy reliance on a single major customer is a core concern. The deep ties between TopsRockets and Tencent are a defining feature of its development history. While this relationship has been crucial for growth, it also represents a significant risk as the company approaches the capital markets.
In terms of equity, Tencent Technology (Shanghai) Co., Ltd. has been investing since the Pre-A round and is currently the largest institutional shareholder, directly holding 19.9493% of shares. Combined with its affiliate Suzhou Paive, their total stake is 20.258%. Tencent also appoints a director to TopsRockets' board, deeply involving itself in corporate governance. Such deep capital integration is uncommon among domestic chip startups.
On the business cooperation front, which began in 2019, the relationship has evolved from small-scale validation in single scenarios to large-scale multi-scenario testing, now entering a deep strategic partnership phase. This bond is directly reflected in sales data: during the reporting period, sales to the top five customers consistently exceeded 90%, at 94.97%, 96.5%, 92.6%, and 96.41%, respectively, indicating persistently high customer concentration.
Specifically, sales to Tencent (including direct sales and AVAP model sales) rose from 8.53% in 2022 to 33.34% in 2023, further increasing to 37.77% in 2024, and reaching 71.84% in the first three quarters of 2025. This means over 70% of current revenue comes from this single related party.
For a company seeking a STAR Market listing, such high customer concentration inevitably raises market concerns: First, does the company possess the capability to independently develop non-related major customers and break free from reliance on a single client? Second, if Tencent's AI computing procurement strategy changes or if their partnership is replaced by other chip suppliers, can TopsRockets maintain its current revenue scale?
TopsRockets candidly highlights these risks in its prospectus, stating that "if new customer development falls short of expectations or Tencent's procurement strategy undergoes significant changes, it would materially adversely affect the company's operating results." However, the statement that "the situation of high sales proportion to Tencent will continue for a certain period in the future" suggests this pattern is unlikely to change soon.
The battle for breakthrough under oligopoly conditions is intense. Competition in the AI chip sector has evolved from pure hardware performance to comprehensive software and hardware ecosystem rivalry. According to IDC data, China's AI accelerator card shipments exceeded 2.7 million units in 2024, with international giant NVIDIA dominating approximately 70% of the market share, thanks to its GPU performance and entrenched CUDA software ecosystem.
For domestic AI chip manufacturers, breaking NVIDIA's ecosystem barrier is a daunting task. In terms of market share, TopsRockets sold 38,800 AI accelerator cards and modules in 2024, accounting for only about 1.4% of China's AI accelerator card market. While this places it among the top domestic AI chip manufacturers, the gap with NVIDIA remains vast.
Notably, among the "Four Domestic GPU Dragons," TopsRockets has chosen a distinct technical path. Instead of following NVIDIA's GPGPU architecture, it developed the GCU-CARE computing unit and GCU-LARE inter-chip interconnect technology based on its own instruction set. This choice reflects a commitment to self-reliance but implies that downstream customers face additional adaptation costs when migrating from the CUDA ecosystem. In contrast, domestic manufacturers adopting GPGPU architectures can better兼容 the CUDA ecosystem, lowering customer migration barriers and gaining an edge in market expansion.
Competitive pressure is directly reflected in profitability metrics. According to comparable company data in the prospectus, TopsRockets' gross margin for AI accelerator cards and modules was 40.78% in 2024, below the industry average for similar products. This highlights the pricing pressure the company faces while competing for market share.
Simultaneously, the company's inventory has expanded rapidly, rising from 311 million yuan at the end of 2022 to 1.148 billion yuan by the end of September 2025. Although the company has made provisions for inventory depreciation, if market conditions change or product technology iterations lag, the net realizable value of inventory could decline further, posing asset impairment risks.
If TopsRockets successfully lists on the STAR Market, IPO proceeds could accelerate the technological iteration and industrialization of its fifth and sixth-generation AI chips, potentially securing its position in the domestic AI chip substitution wave. However, the real test remains: Can this chip company, deeply intertwined with Tencent, demonstrate to the market its ability to achieve independent profitability? After all, over-reliance on a single customer is not a sustainable long-term strategy.
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