Produced by | Entrepreneurship Frontline

Art Editor | Xing Jing

Reviewed by | Song Wen

After two years of large-scale AI models dominating the cloud landscape, the evolution of artificial intelligence (AI) is gradually transitioning from "algorithm iteration" to real-world scenario implementation and hardware commercialization.

Driven by AI technology and specializing in integrated perception and interaction solutions for intelligent terminals, Jihao Technology (Tianjin) Co., Ltd. (hereinafter referred to as Jihao Technology) officially submitted its listing application to the Hong Kong Stock Exchange on June 24.

Leveraging its proprietary chip designs and related modules, Jihao Technology has developed solutions for smartphones, smart glasses, and embodied AI. In 2025, the company achieved RMB 469 million in revenue, securing the second position in the Chinese smartphone biometric solutions market, and has garnered support from multiple industrial capital firms and leading institutions.

However, amidst the burgeoning AI hardware sector, Jihao Technology faces a series of pressing challenges, including a gap with industry leaders, financial structural pressures, a maturing main business sector, and new businesses yet to achieve scale.

Its IPO journey and long-term development potential remain under close scrutiny.

Chen Keqing, the founder and CEO of Jihao Technology, is a 35-year-old straight-A student from the post-90s generation.

Born and raised in Shaoxing, Zhejiang Province, Chen won a gold medal in the National Informatics Olympiad during high school, earning him admission to the Department of Computer Science and Technology at Tsinghua University. He obtained his bachelor's and master's degrees in 2014 and 2017, respectively.

In 2011, while still a university student, Chen joined Megvii Technology, one of the "AI Four Little Dragons," as the company's fifth founding employee. He later rose to the position of Deputy General Manager.

(Image / Generated by AI)

During his tenure, Chen led the team in implementing facial unlocking features for multiple Android flagship smartphones and drove the development of China's first mass-produced 3D structured light smartphone project, accumulating rich experience in deep learning and computer vision development.

In November 2019, Chen chose to leave Megvii Technology to embark on his entrepreneurial journey.

Initially, Chen co-founded Beijing Jigan Technology Co., Ltd., and in 2020, jointly established Jihao Technology with OmniVision Group (Will Semiconductor). As evident, the name Jihao Technology is derived from the first characters of the two companies.

In just five years, Jihao Technology has achieved rapid growth and reached the forefront of the industry.

From 2023 to 2025, the company's revenue was RMB 208 million, RMB 368 million, and RMB 469 million, respectively, with a compound annual growth rate of 50.1%.

However, the company is still operating at a loss. From 2023 to 2025, it incurred losses of RMB 91.782 million, RMB 38.277 million, and RMB 14.384 million, respectively, with cumulative losses over three years reaching RMB 144 million.

(Image / Prospectus)

Nevertheless, the company's adjusted net profit (non-IFRS measurement) in 2025 was approximately RMB 20.464 million, marking its first turnaround.

According to Frost & Sullivan data, in the Chinese smartphone biometric solutions market, based on relevant revenue in 2025, Jihao Technology held a 14.5% market share, ranking second; based on shipment volume, it also ranked second with a 24.1% market share.

It is reported that through cooperation with module manufacturers, Jihao Technology's smartphone solutions have been applied to products from eight of China's top 10 smartphone brands (based on 2025 shipment volume).

During its rapid development, the company has attracted investments from institutions such as OPPO's Xunxing Investment, Will Capital, and Qiming Venture Partners.

(Image / Generated by AI)

Despite its rapid development and support from star capital, the gap between Jihao Technology and industry leader Goodix Technology remains significant.

Frost & Sullivan data shows that based on revenue and shipment volume, Company A (i.e., Goodix Technology) holds the top position in the industry, with market shares of 49.3% and 42.8%, respectively, far surpassing Jihao Technology, which ranks second.

The gap is not only reflected in market share. In terms of operations, Goodix Technology achieved RMB 4.736 billion in revenue and RMB 837 million in net profit in 2025, with a gross profit margin of 42.65% for its main business.

During the same period, Jihao Technology's revenue was RMB 469 million, still operating at a loss, with a gross profit margin of 37.6%.

One is a mature industry leader with annual profits of RMB 800 million, while the other is a "dark horse" player still operating at a loss—the two are clearly not in the same league.

In its operations, Jihao Technology exhibits a high degree of dependency on both upstream and downstream sectors.

On the client side, Jihao Technology's major clients include leading manufacturers such as OPPO, Xiaomi, vivo, Honor, and Samsung Electronics.

From 2023 to 2025, revenue from the top five clients accounted for 99%, 97.4%, and 89.6% of the company's total revenue, respectively. Although this has decreased year by year, nearly 90% of revenue is tied to a few major clients, making it highly susceptible to changes in their business policies. Any order cancellation from a major client could impact Jihao Technology's performance.

(Image / Generated by AI)

Among them, revenue from the largest client accounted for 44.5%, 46.8%, and 41.4% of total revenue, respectively, indicating significant risks associated with a concentrated client structure.

On the supply side, Jihao Technology faces similar issues.

From 2023 to 2025, procurement from the top five suppliers accounted for 90.9%, 84.8%, and 84.0% of the company's total procurement, respectively. In 2025, procurement from the largest supplier exceeded 50%.

Jihao Technology admits in its prospectus that it has weak control over suppliers' operational rhythms, capacity allocation, and pricing strategies, and may face risks such as insufficient capacity, extended lead times, raw material price increases, quality defects, and even supply disruptions at any time.

Binding to a few major smartphone manufacturers downstream and relying on core suppliers upstream places Jihao Technology in a passive position where its supply chain is constrained on both ends, and its profit margins are easily squeezed bidirectionally by upstream and downstream players.

In addition to supply chain risks, potential repurchase pressures at the equity level further amplify cash flow risks.

The prospectus shows that the company has redemption rights clauses for its employee stock ownership plans. If the listing is not completed within 24 months of filing, the repurchase rights will automatically be restored.

As of the end of 2025, the redemption liability was as high as RMB 633 million, accounting for 74.28% of the total current liabilities (RMB 853 million), while the company's cash and cash equivalents were only RMB 125 million, and its net current liabilities had reached RMB 613 million.

During the same period, the company's current ratio and quick ratio were only 0.3 and 0.2, respectively, far below the industry safety threshold of 1, indicating pressure on short-term debt repayment capacity.

This means that if the IPO fails, large-scale repurchases will directly create a cash flow gap, potentially triggering a liquidity crisis.

(Image / Prospectus)

More importantly, Jihao Technology's self-generated cash flow capacity has not yet stabilized. In 2025, its net operating cash flow turned positive for the first time, reaching RMB 12.25 million, but the cumulative net operating cash flow over the three years from 2023 to 2025 was still a net outflow of approximately RMB 21.71 million, indicating overall weak self-generated cash flow capacity.

(Image / Prospectus)

Although Jihao Technology appears to have improving revenue and gross profit margins, its operational foundation is fragile, with uncertain profitability. The combination of weak cash flow and rigid equity repurchase obligations continues to escalate its financial pressure.

In addition to financial pressures and risks associated with client and supply chain concentration, Jihao Technology also faces developmental bottlenecks due to a maturing main business sector.

Although Jihao Technology has deployed three major solutions—smartphones, smart glasses, and embodied AI—the prospectus discloses that over 90% of its revenue over the past three years still came from the smartphone business.

(Image / Prospectus)

The key issue is that the smartphone biometric market, in which Jihao Technology operates, is expected to shrink in 2026.

Frost & Sullivan data shows that the market size of perception and interaction solutions for smartphone biometrics in China was RMB 2.940 billion in 2025, but it is expected to decline to RMB 2.106 billion in 2026, a decrease of 28.37%.

Even though the market size is expected to rebound slightly to RMB 2.660 billion in 2027, it will still not return to the 2025 peak. Against the backdrop of an overall shrinking sector, it will be challenging for Jihao Technology to sustain its past high growth.

(Image / Prospectus)

To hedge against risks in its main business, Jihao Technology has proactively deployed two high-growth AI sectors: smart glasses and embodied AI, which offer vast potential for future growth.

The market size of the smart glasses sector is expected to grow from RMB 840 million in 2025 to RMB 4.26 billion in 2030, with a compound annual growth rate of 38.3%; shipments are expected to increase from 10.5 million units in 2025 to 85 million units in 2030, with a compound annual growth rate of 51.9%.

The market size of the embodied AI sector is expected to grow from RMB 3.38 billion in 2025 to RMB 15.5 billion in 2030, with a compound annual growth rate of 35.6%; shipments are expected to increase from 20.7 million units in 2025 to 38.6 million units in 2030, with a compound annual growth rate of 13.2%.

Prior to the IPO, Jihao Technology has deployed eye-tracking and gesture interaction solutions in the smart glasses sector, which have passed technical verification by manufacturers such as Xiaomi and Honor, although mass production orders have not yet been secured. In the embodied AI sector, the company has launched a spatial data platform and a 5mm ultra-thin visual-tactile sensor, providing perception modules for humanoid robots.

However, Jihao Technology's businesses in these two popular sectors are still in the early stages of R&D. Based on past project experience, the company states that the typical cycle from project initiation to mass production is 6 to 12 months.

In 2025, the smart glasses and embodied AI sectors contributed RMB 39.964 million in revenue to Jihao Technology as part of its "technical services" business segment, representing a 626% increase from RMB 5.5 million in 2024, showing rapid growth.

(Image / Shutterstock, based on VRF protocol)

However, from a business perspective, this revenue consists of customized R&D service fees for specific clients, representing phased, one-time technical cooperation revenue rather than sustainable revenue from hardware mass production.

Moreover, the "technical services" business accounted for only 8.5% of revenue in 2025, and the business volumes in the smart glasses and embodied AI sectors are currently insufficient to support the company's "second growth curve," remaining more of a promising "storyline."

The smartphone industry is undergoing a phased adjustment, while new businesses are unable to contribute sustainable, scalable revenue in the short term. The time lag in transitioning between old and new growth drivers will become one of the biggest challenges for Jihao Technology's future development.

Jihao Technology now stands at a crossroads in its destiny. To break through its growth "ceiling," this company, which started with smartphone unlocking solutions, must first resolve its operational, financial, and sectoral deployment dilemmas.

For Jihao Technology, a successful IPO would not only provide cash through listing to weather the downturn in the smartphone market but also secure a valuable window for R&D and commercialization of new businesses such as AI glasses and embodied AI.

With opportunities and risks lying ahead, whether Jihao Technology can successfully list on the Hong Kong Stock Exchange and achieve business iteration and breakthroughs will continue to be closely watched by "Entrepreneurship Frontline."

*Note: The featured image in the article is generated by AI.