The semiconductor industry is poised for a dual resonance of "AI computing power and domestic substitution" by 2026, with memory chips, as the core hardware foundation of the digital economy, expected to see their market scale surpass $220 billion. Within the domestic memory camp, Ingenic Semiconductor and Gigadevice have distinguished themselves through differentiated strategic positioning and technological barriers. The former has deeply cultivated the automotive-grade memory segment to build a high-barrier moat, while the latter is riding the tailwinds of the memory cycle to achieve simultaneous growth in volume and price. The competitive dynamics and growth trajectories of these two leaders are not only a microcosm of the upgrade within China's domestic memory industry but also serve as critical case studies for investors seeking to capture gains in the technology sector.
Ingenic Semiconductor's core competitiveness lies in its dominant position in the automotive-grade memory track and its comprehensive "computing + memory + analog" strategic layout. Through the acquisition of ISSI, the company rapidly became a key global player in automotive-grade memory. It holds a commanding 20%-35% global market share in automotive-grade SRAM, firmly ranking first in the industry, and a 15%-19% global share in automotive-grade DRAM, placing it second globally. It is the only domestic company to have achieved mass production of the full series of automotive-grade LPDDR4/4X/5 products.
The exceptionally long 5 to 7-year certification cycle for automotive-grade chips has constructed a formidable moat for Ingenic. Once its products are integrated into an automaker's supply chain, they become nearly irreplaceable. Its client roster covers major domestic and international automakers like Volkswagen, BMW, NIO, XPeng, and BYD, reflecting top-tier customer loyalty. Concurrently, the company adheres to a globalized strategy, with overseas revenue accounting for over 80% of its total, primarily from European and American clients, effectively hedging against volatility risks in the domestic market.
2026 is set to be a pivotal inflection point for Ingenic's earnings. Industry trends indicate that global memory giants like Micron, competing for AI server production capacity, are continuously reducing supply from their automotive-grade production lines. This is leading to a potential supply rate of less than 50% for automotive-grade memory, making price increases inevitable. Micron predicts that automotive-grade DRAM prices could surge by over 70% in the first quarter of 2026, with the potential for a doubling in price for the full year. Ingenic, with its preemptive deployment of 16nm and 18nm process DDR4/LPDDR4 products ready for volume supply, is perfectly positioned to capitalize on these price hikes while also reducing production costs through advanced processes. This could propel its net profit towards the 2 billion yuan milestone.
Regarding its long-term growth narrative, the company is steadily advancing the R&D of 3D customized DRAM. Coupled with its high-computing-power SoC chips, this strategically positions Ingenic at the core "memory-computing" nexus of smart vehicles, perfectly aligning with the industry trend where a single high-end car can require nearly 2TB of storage. Simultaneously, its computing chips are accelerating their transition towards AI capabilities; AIoT chips like the AX620A are rapidly penetrating markets such as intelligent security, video devices, and biometrics. Its analog chip business is also deeply integrated with its automotive operations, creating synergistic effects across "Memory + Computing + Analog" and further increasing the value contributed per vehicle.
Gigadevice has built a dual-engine business model driven by "Memory + MCU," with NOR Flash as its foundation, demonstrating remarkable earnings elasticity during the current memory cycle upswing. As the global leader with the second-highest market share in NOR Flash and the top position domestically, the company is fully benefiting from the industry-wide price increases. Prices for its medium- and high-capacity products rose 10%-20% quarter-over-quarter in Q3 2025, with forecasts suggesting a further expansion to 30%-100% in Q1 2026.
The rapid emergence of its niche DRAM business has become Gigadevice's second growth curve. The company has a deep strategic relationship with ChangXin Memory Technologies (CXMT), with its founder, Zhu Yiming, also serving as chairman of both entities, creating a synergistic "design + manufacturing" advantage. Revenue from niche DRAM is projected to reach 4-5 billion yuan in Q4 2025, with full-year revenue potentially breaking the 10 billion yuan mark and a target of 20 billion yuan set for 2026. As penetration rates for AI servers and AI PCs accelerate rapidly, the usage of NOR Flash in edge AI scenarios is doubling. Furthermore, a supply squeeze on DDR4, caused by capacity being diverted to HBM production, has led to the unusual phenomenon where its price exceeds that of DDR5, allowing Gigadevice's related products to continue enjoying the benefits of rising volume and prices.
Gigadevice also shows strong performance in the MCU sector. Its GD32 series encompasses 51 product families with over 600 variants, covering high-performance and low-power scenarios comprehensively. It holds a leading domestic market share and is accelerating the replacement of international leader STMicroelectronics' STM32 series. Notably, the company's automotive-grade NOR Flash and MCU products have passed AEC-Q100 certification and successfully entered the front-load markets of leading automakers like Tesla, making the automotive business a new growth engine.
Financially, Gigadevice's performance outpaces the industry average. Its Q3 2025 report showed revenue of 6.832 billion yuan, net profit attributable to shareholders of 1.083 billion yuan, and a gross margin of 40.72%, which increased by 3.7 percentage points quarter-over-quarter. Most impressively, cash flow from operating activities reached 1.796 billion yuan, placing its cash flow adequacy at the forefront of the industry. Looking ahead, by integrating Sychip to expand its analog and sensor business, Gigadevice is forming a comprehensive ecosystem layout of "Memory + MCU + Analog + Sensing." This broad product portfolio, covering consumer electronics, industrial control, and automotive electronics, will significantly enhance its risk resilience.
The core distinction between Ingenic and Gigadevice lies in their differing growth logics and dimensions of earnings elasticity. In the short term, Gigadevice appears to hold the advantage. The price increase effects from the memory cycle upswing translate directly into its financial performance, with clear price trends for NOR Flash and niche DRAM leading to faster earnings realization, making it suitable for investors seeking short-term momentum.
From the perspective of medium-term growth certainty, Ingenic's advantages are more pronounced. Vehicle intelligence is an irreversible long-term trend, and demand for automotive-grade memory will continue to grow. The company's leading market position and high technological barriers create a deep moat, coupled with extremely strong customer stickiness, resulting in higher certainty for earnings growth. This profile makes it a more suitable choice for medium- to long-term value investors.
Regarding the completeness of their product ecosystems, Gigadevice has broader coverage. Its "Memory + MCU + Analog + Sensing" ecosystem can meet diverse customer needs across various scenarios. Ingenic, conversely, focuses more intently on the automotive and AIoT fields; its "Computing + Memory + Analog" full-stack approach is more targeted, granting it stronger competitiveness within its specific segments. In terms of technological barriers, Ingenic's barriers in automotive-grade memory are exceptionally high, with leading domestic capabilities in full-stack design. Gigadevice's NOR Flash and MCU technologies are mature, while its niche DRAM business is rapidly catching up.
Valuation-wise, as of Q3 2025, Ingenic traded at a P/E ratio of approximately 50x, while Gigadevice's P/E was around 45x, giving the latter a slight valuation advantage. Concerning market space, the general-purpose memory and industrial/consumer MCU markets addressed by Gigadevice are valued in the trillions of yuan. In contrast, the automotive memory and AIoT computing markets on which Ingenic focuses are roughly in the hundred-billion-yuan range, indicating a broader potential market for Gigadevice.
For short-term investors, focusing on Gigadevice is advisable, closely monitoring the price trends of NOR Flash and niche DRAM to capture trading opportunities presented by the memory cycle upswing. For medium- to long-term investors, Ingenic represents a superior choice. The scarcity of its automotive-grade memory offerings and the stability of its earnings allow it to fully capitalize on the long-term红利 of vehicle intelligence, making it suitable for value investment allocation.
Balanced investors might consider allocating to both companies, thereby capturing both cyclical elasticity and long-term certainty while diversifying risk. Regarding risk factors, Ingenic requires monitoring for potential slower-than-expected recovery in industrial/medical demand and delays in the AI transformation of its computing chips. Gigadevice faces risks associated with a potential downturn in the memory cycle, capacity constraints for niche DRAM, and intensifying competition in the MCU market.
Against the dual backdrop of accelerating domestic substitution and exploding demand from AI and automotive electronics, both Ingenic Semiconductor and Gigadevice possess clear long-term growth narratives. Their differentiated strategies have not only carved out distinct growth paths for each company but also provide investors with a diverse range of options. The battle for supremacy in the 2026 memory track is just beginning, and the rise of domestic memory champions deserves the market's continued attention.
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