Gasgoo Munich- China's memory chip industry has reached a historic inflection point.
On May 17, the Shanghai Stock Exchange revealed that CXMT had officially filed an updated prospectus. The financial figures sent a jolt through the market: nearly a decade after its founding, the chipmaker turned its first annual profit in 2025. By the first quarter of 2026, it was reporting 50.8 billion yuan in revenue and 24.76 billion yuan in net income attributable to shareholders.
This marks more than just a profitability inflection point for CXMT; it signals that China's domestic DRAM industry has achieved mass-scale profitability as the global memory cycle recovers.
From an Annual Loss of 7.8 Billion to a Quarterly Profit of 24.7 Billion: CXMT Achieves Rapid Turnaround
Data shows CXMT's revenue grew at a compound rate of 160.78% between 2023 and 2025. In 2025 alone, revenue reached 61.8 billion yuan — a roughly 155% increase from the previous year.
Even more critical is the bottom line. After posting a net loss of 7.87 billion yuan in 2024, CXMT returned to a profit of 1.88 billion yuan in 2025 — a turnaround that arrived well ahead of schedule. After years of heavy R&D spending and production line construction, the company has finally achieved self-sustaining cash flow.
Image Source: CXMT
The momentum continued in the first quarter of 2026. Revenue for the period reached 50.8 billion yuan, a 719% year-over-year increase, while net income attributable to shareholders reached 24.76 billion yuan. Excluding non-recurring items, profit was even higher at 26.34 billion yuan. That single-quarter result is more than ten times the company's total profit for all of 2025.
CXMT projects a strong first half of 2026, forecasting revenue between 110 billion and 120 billion yuan — up 613% to 677% year-over-year. Net profit is expected to be between 66 billion and 75 billion yuan, with attributable net income ranging from 50 billion to 57 billion yuan. By those estimates, first-half attributable profit alone will be more than 26 times what the company earned in all of 2025.
A swing from significant losses in 2024 to modest gains in 2025, followed by rapid profit growth in early 2026, is a rapid turnaround rarely seen in semiconductor history. It underscores the high volatility of the DRAM cycle, but also proves that CXMT has effectively aligned its product mix, capacity expansion, and market strategy.
Notably, the company's revenue mix is improving. The prospectus reveals a rising share of high-end products like DDR5 and LPDDR5/5X, which has significantly improved margins. Gross margins, previously negative or in the low single digits, rose to double digits in 2025. By the first quarter of 2026, as prices continued their increase, margins improved even further.
In terms of footprint, CXMT operates three 12-inch DRAM wafer fabs across Hefei and Beijing. Citing Omdia data, the company ranks first in China and fourth globally for DRAM by capacity, shipments, and sales. With capacity utilization running high, economies of scale are taking effect.
Rising Prices and Supply Mismatches: How a DRAM Super Cycle Drives a Domestic Leader's Recovery
How did CXMT transition from deep losses to significant profitability in just a year? The answer lies in the convergence of the DRAM cycle and its own strategic choices.
The most direct driver is rising prices. The prospectus shows the average selling price of CXMT's main DRAM products increased by 55.08% in 2024 and another 33.69% in 2025. For a vendor shipping increasing volumes, that kind of pricing power provides significant profit leverage.
"Since the second half of 2025, sustained price increases have driven a rapid improvement in gross margins and profit levels, propelling the company to profitability in 2025," CXMT stated. Far from slowing, that trend accelerated into the first quarter of 2026. Global DRAM supply is struggling to meet demand, and prices have continued their sharp increase since mid-2025.
What is fueling this DRAM price rally? Three main factors are at play.
First, a surge in global computing demand. Since 2023, the generative AI boom has triggered rapid growth for High Bandwidth Memory (HBM) and premium DDR5. Major cloud and AI chipmakers are buying aggressively, diverting DRAM capacity toward HBM and limiting supply for conventional memory. Although CXMT only began mass-producing HBM in early 2026 and is still ramping up, its DDR5 and LPDDR5X products are already benefiting from the price increases caused by tightening supply.
Second, capacity reallocation by global giants. As major players shift large amounts of capacity to HBM and advanced-node DRAM, shortages have emerged for mainstream products like DDR4 and LPDDR4X. CXMT, with a complete product line in the mainstream market, is well-positioned to capture those premium orders.
Third, a reversal in inventory cycles. After a deep destocking phase from 2022 to early 2024, DRAM inventory levels fell to a healthy roughly 2.5 months by mid-2024. The combination of fresh AI demand and the top three manufacturers shifting capacity to HBM created a confluence of "low inventory + strong AI server demand + capacity transfer," pushing prices up since mid-2025. Data from the National Development and Reform Commission's Price Monitoring Center shows mainstream DRAM prices rose about 83% between September 2025 and January 2026.
CXMT's "generation-skipping" R&D strategy also deserves credit in this super cycle. Rather than chasing competitors node-by-node, the company skipped several generations early on, evolving rapidly from its first process platform to its fourth. It has now completed the product coverage and upgrade cycle from DDR4 and LPDDR4X to DDR5 and LPDDR5/5X. That approach allowed it to achieve cost and performance competitiveness in newer products faster, maximizing profit leverage when prices rose.
Furthermore, ChangXin's capacity ramp-up is yielding results. The launch and yield improvements at its three 12-inch fabs have steadily expanded production scale. The 719% revenue increase to 50.8 billion yuan in the first quarter of 2026 confirms that shipment volumes are also rising rapidly. Rising volumes plus rising prices — that is the core logic behind the rapid profit growth.
The company's outlook for the first half of 2026 suggests this trend will persist. Based on the midpoint of its guidance, net profit for the period should reach around 70.5 billion yuan, with attributable net income of about 53.5 billion yuan. That implies that even if prices ease in the second half, ChangXin's full-year earnings will remain substantial.
Of course, industry cycles are a double-edged sword. The history of DRAM is filled with lessons about sharp price swings. CXMT acknowledged the risk of price volatility in its prospectus, noting that unit prices fluctuated by more than 30% in both 2024 and 2025. If demand slows or capacity floods the market, prices could retreat. Still, over the long term, CXMT is building resilience against these cycles through steady improvements in technology, capacity, and its customer mix.
Ultimately, the financial data CXMT released represents more than just a corporate turnaround; it is a signal that China has achieved a commercial breakthrough in DRAM, a critical segment of the memory market. From its founding in 2016 to profitability in 2025, CXMT spent nearly a decade developing its capabilities. With financial results that significantly exceeded expectations, it has proven the commercial viability of domestic DRAM. And in this new global cycle for memory chips, driven by AI, its story may only just be beginning.
