Muxi Inc.: GPU Sector "Burns Money" and Is Difficult to Profit, Market Value Shrinks by Over 100 Billion

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Source: Securities Star

Recently, Muxi Co., Ltd. (688802.SH) released its 2025 earnings forecast and Q1 2026 performance preview. The company is still operating at a loss.

Securities Star notes that, in the context of high industry R&D investment and long cycles, the company’s current sales scale is insufficient to cover costs and expenses, which is the main reason for ongoing losses. Since 2022, the company’s accumulated losses have reached up to 4 billion yuan. While revenue is growing rapidly, the company faces urgent issues such as reducing dependence on a single product, accelerating mass production of new products, and breaking through development limitations of the eco-compatible GPU route.

Despite continuous losses, Muxi Co.'s performance in the secondary market is also not optimistic. Since listing, the stock price has steadily declined, with a drop of over 40% from its peak, and market value has shrunk by more than 150 billion yuan.

1. High operating expenses, losses for four consecutive years

Public data shows that Muxi’s main business is the research, design, and sales of full-stack GPU products used in AI training and inference, general computing, and graphics rendering, along with supporting software stacks and computing platforms around GPU chips.

The 2025 earnings forecast shows the company achieved a total revenue of 1.644 billion yuan, up 121.26% year-over-year; net profit attributable to shareholders was -781 million yuan, narrowing losses by 44.53%. Securities Star notes that although revenue continues to grow, the growth rate has slowed. In 2023 and 2024, revenue growth rates were 12,334.6% and 1,301.46%, respectively.

The Q1 2026 forecast indicates revenue of 400 million to 600 million yuan, up 24.84% to 87.26% year-over-year; net loss attributable to shareholders is estimated between 90.75 million and 182 million yuan, narrowing losses by 21.93% to 60.97%. Since 2022, the company’s accumulated losses have reached up to 4.02 billion yuan.

Securities Star points out that high R&D investment is a key reason for Muxi’s sustained losses. The GPU chip industry is capital- and technology-intensive, with high barriers to entry and heavy R&D requirements. The company continues to increase R&D spending to strengthen product competitiveness.

Meanwhile, the company’s products are still in the market ramp-up phase, and revenue is not yet sufficient to cover costs. Its intelligent computing inference GPU chip series Xisi N100 and training-inference integrated GPU chip series Xiyun C500 achieved mass production in April 2023 and February 2024, respectively. Due to the rigorous technical validation and ecological adaptation cycles required for key industry clients, current sales are insufficient to cover costs.

The high proportion of R&D and other expenses further confirms this situation. From 2022 to 2024, cumulative R&D expenses totaled 2.248 billion yuan, 2.82 times the total revenue during the same period; in the first three quarters of 2025, R&D, sales, and administrative expenses combined reached 1.057 billion yuan, accounting for 85.52% of total revenue.

Additionally, due to multiple employee stock incentive plans in earlier years, significant share-based payment expenses were recognized, impacting profitability. From 2022 to 2024, share-based payment expenses totaled 570 million yuan, becoming another major reason for losses. In 2025, these expenses decreased, reducing overall losses.

It is noteworthy that, amid ongoing losses, the company’s new depreciation and amortization from fundraising projects will further squeeze profit margins.

The company raised 4.197 billion yuan through an IPO, which was allocated to R&D and industrialization of new high-performance general GPU chips, next-generation AI inference GPU chips, and high-performance GPU technology for frontier and emerging applications. As these projects advance, significant depreciation and related expenses are expected to directly impact future performance.

Securities Star also notes that as business scale expands, inventory levels have risen from 18 million yuan in 2022 to 777 million yuan in 2024. As of the end of September 2025, inventory further increased to 1.472 billion yuan, accounting for 119% of current period revenue.

2. Single product line, stock price down over 40%

Currently, Muxi’s revenue mainly depends on sales of the training-inference integrated chip series Xiyun C500. In 2024, this product generated 722 million yuan, accounting for 97.28% of total revenue, indicating a high risk of revenue dependence on a single product.

The company is developing new products based on domestic supply chains, including the next-generation training-inference chips Xiyun C600 and C700 series, as well as new intelligent inference GPU Xisi N series and graphics rendering GPU Xicai G series. However, given the long R&D cycles, large investments, and complex validation processes, these products are unlikely to achieve large-scale shipments and revenue support in the short term.

It is also worth noting that domestic AI chip manufacturers include GPU design companies like Muxi, Haiguang Information, Shendu Zhixin, Biren Technology, and Moore Thread, as well as ASIC chip companies such as Huawei HiSilicon, Cambrian, Kunlun Chip, Pingtouge, and Suiyuan Technology. This means that, with increasing market demand for AI chips, the company faces competition not only from domestic GPU designers but also from ASIC chip manufacturers.

Some analysts point out that current leading domestic GPU startups have distinct strategic directions. Moore Thread focuses on full-featured GPU routes, Biren Technology targets high-end GPGPU original computing power, while Muxi has chosen an eco-compatible GPU route, aiming to quickly reduce user migration costs rather than redefining GPUs.

Technologically, Muxi emphasizes CUDA compatibility layers and mainstream framework adaptation, focusing more on software and ecosystem toolchains, with hardware architecture designed around ecological compatibility. Its advantage lies in low migration costs and faster commercialization, but it also faces challenges such as dependency on mainstream ecosystems and limited space for architectural innovation.

Furthermore, revenue from the top five clients accounts for a high proportion of total income. In 2024, revenue from these clients was 527 million yuan, representing 71.09% of total revenue, indicating high customer concentration risk.

Securities Star notes that, amid ongoing losses, Muxi’s performance in the secondary market is also not optimistic. As the second listed “Chinese GPU Four Little Dragons” after Moore Thread, the company’s stock price has already experienced a correction.

On its listing day (December 17, 2025), the stock opened high and rose throughout the day, reaching a peak of 895 yuan per share, a maximum increase of 755.15%. It closed at 700 yuan per share, up 692.95% for the day. Since then, the stock has declined, and as of March 16, the closing price was 535 yuan per share, over 40% below the peak, with a market value shrinkage of about 144 billion yuan. (This article first published by Securities Star, author: Li Ruohan)