Techwinsemi now carries RMB28.99 billion of inventory after a RMB13.69 billion operating cash outflow, tying its next results closely to memory prices holding up into 2027.
Shenzhen Techwinsemi Technology, the storage chip and drive maker listed in Shenzhen as 德明利, earned RMB8.75 billion in net profit attributable to shareholders in the first nine months of 2026, against a loss of about RMB27.08 million a year earlier. Revenue rose 328.81% to RMB28.56 billion, according to the company’s third-quarter report, published on October 25 and reproduced by CFi.CN. Third-quarter revenue alone was RMB11.65 billion, up 356.64%, and quarterly net profit was RMB2.73 billion, up 2,902.75%, Jiemian reported.
The single quarter’s profit was nearly four times Techwinsemi’s net profit of RMB688 million for the whole of 2025, the Daily Economic News calculated. The company credits a strong storage market, a stable supply chain, its own controller chips (the processors that manage data on a drive) and a rising share of enterprise storage products in its sales.
Quarterly profit has nonetheless come off its peak. Second-quarter net profit was RMB2.671 billion, so the third quarter improved by only about 2% sequentially, according to 21st Century Business Herald. Both quarters trailed the first, when Techwinsemi earned RMB3.346 billion, Securities Times reported in April, leaving third-quarter profit about 18% below that high. The balance sheet also shows the cost of growth: the company spent heavily on inventory and posted a large operating cash outflow.
Techwinsemi’s results land at the top of a strong chip reporting season
Excluding one-off items, Techwinsemi’s nine-month net profit was RMB8.69 billion, and basic earnings per share were RMB27.77, the report shows. Research and development spending rose 171.65% to RMB478 million, the Daily Economic News reported. The results came in within the range the company forecast on October 16, when it guided for nine-month revenue of RMB27.5 billion to RMB29.5 billion and said enterprise storage sales had reached RMB8.237 billion, according to an earlier Daily Economic News report.
Techwinsemi’s forecast ranked third among A-share chip companies, behind CXMT and Longsys, when Shanghai Securities News ranked nine-month profit guidance on October 20. EastFrontier reported on CXMT’s profit forecast of RMB131 billion to RMB132.5 billion for the period. Across the wider market, 851 A-share companies had published nine-month results by October 25, Yicai reported using Wind data. The 30 semiconductor companies among them grew revenue by an average of 26.73% and net profit by 181.38%, and only six reported lower sales.
A RMB28.99 billion inventory build is behind the cash outflow
Techwinsemi’s inventory rose to RMB28.99 billion at the end of September from RMB7.06 billion at the start of 2026, which it links to stocking for enterprise storage orders. Net operating cash flow for the nine months was an outflow of RMB13.69 billion, and total assets nearly quadrupled to RMB40.22 billion from RMB10.85 billion at the end of 2025, according to the report. Financial expenses rose 331.7%, which the company attributes to foreign-exchange losses and interest on increased borrowing.
The bet on inventory pays off as long as memory prices keep rising. Shanghai Securities News described the market as a supply-short "super-cycle" since the second half of 2025, and cited Gartner forecasts that global memory revenue will reach US$837.3 billion in 2026, with growth slowing to about 30% in 2027 and no meaningful easing in DRAM and NAND prices before the second half of 2027.
Investors have already marked the stock down from its peak. The shares closed at RMB251 on October 23, giving a market value of RMB79.7 billion, China News Jingwei reported, and were up 52.41% for the year. They had reached an intraday high of RMB696.73 on June 26 and had fallen about 70% from that level by October 16, the Daily Economic News reported.
Fourth-quarter memory prices will decide whether the run continues
Techwinsemi says its enterprise storage products are shipping in volume to large domestic cloud providers and that it is expanding into server makers, government-led domestic IT procurement and overseas markets, with a production base in Vietnam now delivering in volume, according to the October 16 Daily Economic News report. The company also says it is prioritizing research into 3D PCM, a type of non-volatile memory, the Daily Economic News reported on October 25.
The figure to watch is how fast that RMB28.99 billion of inventory turns into revenue. Fourth-quarter results, and any slowdown in the price increases Gartner expects to last into 2027, will show whether the stockpile turns into sales at current margins or leaves the company holding chips bought near the top of the cycle.