Author｜Kang Tian

Editor｜Wei Fanxi

In recent years, the wave of generative AI has swept through global capital markets, prompting an increasing number of AI companies to pursue IPOs.

On June 18, DataStory Artificial Intelligence Technology Co., Ltd. (hereinafter referred to as DataStory) submitted its prospectus to the Hong Kong Stock Exchange, with CITIC Construction International acting as the sole sponsor.

According to CIC Consulting, DataStory ranks third in China's enterprise-level large model-driven business growth market based on 2025 revenue.

However, behind the sustained hype around AI concepts, DataStory still faces multiple challenges, including an incomplete profitability framework, persistently declining gross margins, and long-term pressure on operating cash flows.

As capital markets shift their focus from technological narratives to commercial viability, whether DataStory can demonstrate its long-term value to the market remains to be seen.

DataStory is a native artificial intelligence (AI) technology company that empowers enterprise acceleration through a suite of enterprise-level large model-based application products and solutions.

Its core technological framework includes the SocialGPT vertical domain large model, the EnlightAI multi-agent system, and enterprise-level data infrastructure. DataStory aims to assist enterprises in achieving end-to-end growth management, from data analysis to business decision-making and execution.

From a financial perspective, DataStory's revenue demonstrated rapid growth from 2023 to 2025, reaching RMB 235 million, RMB 283 million, and RMB 503 million, respectively, with a compound annual growth rate of approximately 46.4%. In the first three months of 2026, its revenue surged by 53.8% year-on-year to RMB 79.647 million.

However, in stark contrast to this revenue growth, the company's profitability challenges remain unresolved.

From 2023 to 2025, DataStory reported annual profits of -RMB 115 million, -RMB 86.911 million, and -RMB 51.728 million, respectively. While losses continued to narrow, profitability remained elusive. In the first three months of 2026, losses further widened, with annual profits plummeting from -RMB 28.734 million in the same period last year to -RMB 144 million.

Persistent operating losses stem primarily from R&D expenditures and financing costs associated with redemption liability.

As a native AI technology company, DataStory has maintained consistently high R&D investment in recent years.

From 2023 to 2025, R&D expenditures reached RMB 110 million, RMB 96.673 million, and RMB 98.152 million, accounting for 46.8%, 34.1%, and 19.5% of total revenue in the respective periods, showing a declining trend primarily due to revenue growth outpacing R&D spending. In the first three months of 2026, R&D expenditures surged by 105.1% year-on-year to RMB 40.184 million.

Currently, large model commercialization remains in its early stages, with sustained R&D investment being a common feature of the AI industry. For DataStory, substantial ongoing R&D supports the iterative upgrades of its SocialGPT vertical large model and EnlightAI multi-agent system, building medium- to long-term technological moats. However, this objectively raises short-term costs, directly suppressing current profitability.

Meanwhile, financial costs associated with redemption liability have also become a significant factor affecting profitability.

DataStory's financial costs primarily include redemption liability, lease liability, and interest on bank loans and other borrowings. From 2023 to 2025, financial costs amounted to RMB 50.954 million, RMB 50.751 million, and RMB 51.435 million, respectively, with redemption liability interest accounting for RMB 50.355 million, RMB 50.373 million, and RMB 49.914 million in the respective periods.

These expenditures are non-cash in nature. The prospectus clarifies that if the H-share listing is successfully completed, all preferred stock redemption rights will be reclassified as company equity, eliminating tens of millions in annual rigid interest payments and significantly reducing reported loss pressures.

DataStory offers a suite of enterprise growth AI application products and solutions, covering key business scenarios across the full commercial growth cycle, including insights (market insights, consumer insights, and product innovation), marketing (brand marketing and content marketing), and sales (channel expansion and operational optimization).

From 2023 to 2025, revenue from DataStory's enterprise growth AI solutions grew from RMB 118 million to RMB 390 million, with its share of total revenue increasing from 50.1% to 77.5%. In contrast, revenue from enterprise growth AI application products rose slightly from RMB 88.19 million to RMB 106 million, with its share of total revenue declining from 37.6% to 21.1%.

DataStory's enterprise growth AI solutions encompass automated end-to-end business growth workflows, all highly customizable in nature. Consequently, their standardization, replication efficiency, and profit margin performance typically lag behind those of enterprise growth AI application products.

Specifically, from 2023 to 2025, gross margins for DataStory's enterprise growth AI solutions were 35.3%, 32.9%, and 30.1%, respectively, falling to 27.1% in the first three months of 2026. During the same periods, gross margins for enterprise growth AI application products were 89.9%, 91.2%, and 88.5%, respectively, declining to 80.0% in the first three months of 2026.

The overall decline in gross margins, coupled with the rising share of relatively low-margin solution products, caused DataStory's overall gross margin to drop from 57.2% in 2023 to 42.1%, further falling to 39.9% in the first three months of 2026.

Meanwhile, the customized deployment business model has made the company's operations highly dependent on downstream customer demand. According to the prospectus, DataStory's clients primarily include enterprises in the lifestyle, durable goods consumption, internet, automotive, and other industries.

From 2023 to 2025, the number of DataStory's major clients (contributing over RMB 1 million in annual revenue) increased yearly, reaching 45, 50, and 83, respectively. During the same periods, revenue from major clients accounted for 71.0%, 70.0%, and 81.1% of total revenue, with revenue from the top five clients accounting for 25.0%, 27.8%, and 26.1% of total revenue, respectively.

According to CIC Consulting, based on 2025 revenue rankings, DataStory has served over 65 Fortune Global 500 companies and 135 Global 500 consumer goods companies.

The growing number of major clients indicates increasing recognition of DataStory's solutions among large enterprises. However, if some large clients reduce budgets, adjust supplier systems, or choose to build in-house AI capabilities, the company's revenue growth could be impacted.

Despite DataStory's expanding revenue scale, the company remains in a development stage reliant on external capital to drive business expansion.

From 2023 to 2025 and in the first three months of 2026, DataStory's cash flows from operating activities remained negative, at -RMB 28.788 million, -RMB 41.186 million, -RMB 72.757 million, and -RMB 44.271 million, respectively.

As of the end of March 2026, DataStory's cash and cash equivalents stood at RMB 66.172 million, insufficient to cover its short-term interest-bearing bank loans and other borrowings of RMB 67.799 million and long-term interest-bearing bank loans and other borrowings of RMB 96 million.

In this Hong Kong IPO, DataStory plans to allocate part of the proceeds to supplement working capital and for general corporate purposes.

In addition to insufficient self-generated cash flow and weak cash reserves, extended payment terms from downstream clients further strain the company's capital turnover.

From 2023 to 2025, DataStory's trade receivables and bills receivable were RMB 68.416 million, RMB 123 million, and RMB 205 million, respectively, reaching RMB 193 million in the first three months of 2026. During the same periods, the company's trade receivables turnover days were 107, 123, and 119, respectively, further climbing to 225 days in the first three months of 2026.

DataStory explained in its prospectus that changes in trade receivables and bills receivable turnover days primarily stem from seasonal factors and credit terms granted to large, reputable clients.

For a long time, the company's daily operating funds have relied primarily on multiple rounds of financing. From 2017 to 2022, DataStory completed nine rounds of financing from Pre-A to C++ rounds, with a total paid consideration (excluding equity transfers) of approximately RMB 448 million.

Due to preferred rights attached to some shares, substantial preferred stock redemption liabilities were incurred, continuously increasing the company's debt scale. From 2023 to 2025, DataStory's redemption liabilities increased yearly to RMB 753 million, RMB 803 million, and RMB 853 million, respectively, further rising to RMB 866 million in the first three months of 2026.

In May 2026, less than a month before this IPO, DataStory conducted another strategic financing round, with a total consideration (excluding share transfers) of RMB 78.8603 million. After this financing, DataStory's valuation exceeded RMB 5 billion.

Standing at the forefront of rapid commercialization in enterprise-level AI, DataStory has successfully seized development opportunities brought by AI application adoption, leveraging its long-accumulated data assets, industry experience, and top-tier client resources. However, rapid revenue growth does not equate to a mature business model. From profitability and cash flow quality to client structure, DataStory still faces numerous challenges.