Going public is to go further, but in the end, only performance proves itself.
Cambrian, the company that was once in a mess in the semiconductor market, is now quieter. In less than a year of listing, Cambrian’s stock price fell by more than 55% from a high, and its market value evaporated by more than 60 billion yuan.
For the Cambrian, was the sharp decline a return of value or was it underestimated by the market?
As a chip company that has only been established for five years, the Cambrian was born with a “golden spoon” in it.
After its establishment in 2016, they soon launched the artificial intelligence chip 1A processor, and in one fell swoop created a technological precedent for artificial intelligence chips in China.
In 2017, Cambrian received 100 million U.S. dollars in Series A financing. Ali and Lenovo are its shareholders, and the post-investment valuation exceeded 1 billion U.S. dollars.
As a result, Cambrian has also become the first unicorn company in the global AI chip field.
In the same year, Huawei HiSilicon developed the first mobile phone artificial intelligence chip Kirin 970, and it was the Cambrian that provided HiSilicon with AI computing power chips, and the Cambrian became a hit.
In the first two or three years of its establishment, Cambrian’s business model was the business path of IP authorization. According to its financial report, most of Cambrian’s revenue in 2017 and 2018 came from Huawei.
In 2019, Huawei HiSilicon decided to develop its own chips, and the honeymoon period of Cambrian and Huawei also ended.
According to the prospectus, the Cambrian terminal intelligent processor IP authorization business income was 68,771,200 yuan, a decrease of 41.23% compared to 2018. In this regard, Cambrian also said that because the company and HiSilicon failed to reach a new cooperation, it is difficult for the company to develop large customers of the same size in the short term.
The financial report shows that in 2020, the Cambrian’s terminal intelligent processor IP realized operating income of 11,717,600 yuan, a decrease of 82.96% from the same period last year.
The end of cooperation with Huawei forced Cambrian to open up new business channels and directions-intelligent computing cluster system business.
According to Cambrian’s financial report, this business accounted for 67% and 70.96% of its revenue in 2019 and 2020, respectively.
On April 27, Cambrian released its 2020 annual report and the first quarter of 2021 financial report. The financial report showed that the net loss of Cambrian in 2020 was 435 million; the net loss of the first quarter of 2021 was 206 million, a year-on-year decrease of more than 8.9. 72. The loss has a tendency to expand.
On May 13, Cambrian held the 2020 annual performance briefing meeting, when asked whether it would cut into the automotive field.
Cambrian Chairman and CEO Chen Tianshi said that smart driving is one of the important application areas of the AI chip industry. The demand for automotive chips will expand rapidly in the future, and smart chips have a broad market space in the automotive field. Therefore, Cambrian will not be absent from such an important application market.
On the whole, as a young newly established chip manufacturer, Cambrian is still young compared with international manufacturers, and its competitiveness is also slightly weaker. Compared with some medium-sized chip manufacturers, its price/performance ratio is a bit worse.
Therefore, the pressure that the Cambrian will face in the future is still relatively large.
In fact, in addition to the pressure on revenue, the pressure on research and development of the Cambrian is also not small. As we all know, the higher the chip development, the more expensive it is. The Cambrian financial report shows that its R&D investment from 2017 to 2019 has shown a trend of increasing year by year, which is 0.29 billion, 240 million and 540 million respectively.
According to the financial report for the first quarter of 2021, Cambrian’s book currency funds are 1.887 billion yuan. For a chip company, these cash reserves are definitely not enough.
In the future, in terms of practicality, Cambrian must develop more high-end and better products. Of course, it is also a good choice to enter the automotive chip field, because with the continuous outbreak of the new energy vehicle field, the demand for chips in this field will continue to expand. The current global “chip shortage”, especially the shortage of automotive chips, is becoming more and more serious. For the Cambrian, it was an excellent opportunity.
In addition, Cambrian must also solve the problem of relying heavily on large customers. Data shows that its largest customer accounts for more than 57% of its revenue. In order to avoid incidents similar to Huawei, Cambrian must do Out of circumvention.