New Easymount, cash flow surges by 1500%!

（Source: Langge Finance）

AI technology is driving a new wave of industrial transformation!

In 2025, AI large models will see explosive growth, with the global number nearing 4,000. Among them, more than 1,500 large models released in China, firmly ranking first globally.

Against this backdrop, cloud service providers are accelerating the building of AI infrastructure, and the industry’s overall capital expenditures have entered a phase of rapid growth.

The four tech giants—Google, Microsoft, Meta, and Amazon—are also making major moves, planning to invest a combined total of more than $400 billion in AI infrastructure in 2026, bringing unprecedented opportunities for the compute power track.

The continuous expansion of the AI compute power market directly ignites demand for optical modules.

Data shows that the global optical module market size in 2022 was only $11 billion, and it is expected to surge to $23 billion by 2028, potentially doubling in growth.

So, what is an optical module?

An optical module is the core carrier for data transmission between communication devices—like a precise “translator,” enabling the free conversion between optical signals and electrical signals.

In the AI era, it’s even more like the “heart of data transmission.” Every high-performance AI server needs dozens or even hundreds of high-speed optical modules to support it, and its importance is self-evident.

At the same time, the development of AI technology has also rewritten the product iteration cycle of the optical communications industry.

After 2023, as AI technology flourished, demand for computing capabilities far exceeded that of traditional general-purpose computing. Demand for optical communication products surged, and the iteration cycle was directly accelerated from about 3 years to 1–2 years.

With the pace of technological upgrades continuing to accelerate, 400G optical modules began large-scale commercial deployment in 2023. Today, 1.6T optical modules have already entered mass shipments, and higher-speed has become the core trend of industry development.

In this round of technological upgrades and market competition for optical modules, Xin Yi Sheng is putting on a “comeback at the bend”!

Accurate positioning:

Move into high-speed optical modules

In 2008, Gophoton Communication and Yijielong merged to establish Xin Yi Sheng. From its founding, the company has firmly focused its core business on the R&D and production of optical modules.

Currently, the company has successfully mass-produced and delivered the latest-generation 1.6T optical modules, while actively advancing the R&D and sample production of even higher-speed optical modules such as 3.2T and 6.4T, continuously positioning itself at the technological forefront of high-speed optical modules.

Behind its hard-core technical strength is real, sustained investment in money.

From 2021 to 2024, Xin Yi Sheng’s R&D expenses surged from 108 million yuan to 403 million yuan. In the first three quarters of 2025, R&D expenses also reached 501 million yuan, providing confidence for technological iteration.

The company’s 2024 annual report shows that its high-speed optical modules, data center interconnect optical modules, and other products have successfully passed acceptance, and LPO technology optical modules have also entered the small-batch production stage, with the technology roadmap continuing to stay at the industry’s leading edge.

Abundant cash flow provides solid support for the company’s continued R&D spending.

From 2021 to 2024, Xin Yi Sheng’s net operating cash flow rose from 219 million yuan to 641 million yuan. In the first three quarters of 2025, it was as high as 4.637 billion yuan, a year-on-year increase of 1,530%, showing very strong “blood-making” capability!

Cost control further enhances Xin Yi Sheng’s market competitiveness.

Optical devices account for 73% of the total cost of optical modules, while optical receiver subassemblies (ROSA) and optical transmitter subassemblies (TOSA) account for 80% of optical device costs. Xin Yi Sheng reduces production costs at the core stages by independently processing part of the ROSA and TOSA to replace externally purchased components.

In addition, in 2022, the company acquired Alpine, a North American silicon photonics chip technology company. With R&D cooperation between Alpine and core raw material manufacturers, it purchases components at advantageous prices, further improving its in-house supply capability.

From 2020 to the first three quarters of 2025, Xin Yi Sheng’s gross margin increased from 32.17% to 47.25%, up more than 15 percentage points.

With strong competitive advantages, the company has turned in an impressive performance.

According to the earnings forecast, Xin Yi Sheng expects net profit in 2025 of 9.4 billion yuan to 9.9 billion yuan, with the maximum year-on-year growth rate reaching 248.86%.

Worth mentioning is that this figure exceeds the sum of the company’s net profits over the past 10 years. In other words, in just 1 year, it earns the money it made over the previous 10 years.

As an “AI shovel seller,” supported by multiple factors such as technology and costs, Xin Yi Sheng has achieved leapfrog growth in the optical module sector. But with competition in the industry becoming increasingly intense, how will it plan for the future and continue to firmly seize the initiative in industry development?

Two-pronged approach:

Capture industry dividends

In the face of fierce market competition, Xin Yi Sheng has already laid groundwork early, preparing to seize the future market from two major angles.

One is accelerating expansion overseas.

The company started laying out global production capacity early. In 2023, the first phase of the Thailand plant officially began production. In 2025, the second phase ran smoothly and entered a sustained capacity expansion stage.

In 2024, Xin Yi Sheng issued an announcement stating it plans to raise 1.88 billion yuan to expand high-speed optical module capacity. Among them, the investment in the Thailand production base is about 1.08 billion yuan, continuing to add overseas capacity.

From 2021 to 2024, Xin Yi Sheng’s optical module capacity stayed below that of InniHightone. In the first half of 2025, its capacity reached 15.2 million units, achieving a decisive turnaround in capacity.

As capacity increases, its overseas business has developed rapidly.

From 2021 to 2024, Xin Yi Sheng’s overseas revenue rose from 2.273 billion yuan to 6.805 billion yuan. In the first half of 2025, its overseas revenue further increased to 9.86 billion yuan, and the share of overseas revenue soared to 94.5%, setting a new high in nearly a decade.

Currently, Xin Yi Sheng has established strong cooperative relationships with mainstream global communications equipment manufacturers and internet companies. Its customer base spans multiple regions including Europe, North America, and Asia, and its global delivery capabilities continue to improve.

The other is stockpiling on a large scale.

As of the end of Q3 2025, Xin Yi Sheng’s total inventory amounted to 6.6 billion yuan, representing 30.9% of total assets, up 117.8% year over year.

Based on the company’s 2025 semiannual report, the core composition of inventory consists of raw materials, work in progress, and self-manufactured semi-finished goods, totaling about 4.4 billion yuan and accounting for 70%.

And behind this large inventory balance, there are ample in-hand orders to support it.

Contract liabilities are an important indicator for measuring in-hand orders. In the first three quarters of 2025, they reached 3.2T yuan, a sharp year-on-year increase of 124.3%, directly reflecting the rapid rise in the company’s order volume.

Xin Yi Sheng has also clearly stated that the increase in inventory is due to pre-stocking some raw materials in advance based on order conditions, with the goal of responding to order demand in a timely manner and ensuring subsequent deliveries.

Of course, the company has also been monitoring inventory impairment risks. In the first half of 2025, it accrued 164 million yuan in inventory price-decline provisions.

Xin Yi Sheng is, on one hand, continuously strengthening its competitive advantage in overseas markets, and on the other hand, accelerating its stockpiling pace—laying a solid foundation for capturing future optical module industry dividends.

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