Profitability Analysis of Shiya Technology's Silicon-Based OLED Business

Based on the information I have obtained, I will conduct an in-depth analysis of the profit sustainability of Shiya Technology’s silicon-based OLED business for you.

Shiya Technology is a high-tech enterprise focused on

, and is currently in the process of a STAR Market IPO [1]. The company’s products are mainly used in consumer electronics fields such as [1].

In terms of business structure, the company’s revenue breakdown for January-September 2025 is as follows [1]:

Business Segment	Revenue (ten thousand RMB)	Proportion
Silicon-Based OLED Micro-Displays	21,691.86	74.1%
Strategic Product Development	5,740.51	19.6%
Optical Systems and XR Integrated Solutions	1,843.12	6.3%

: According to public information I retrieved [1][2], the gross margin levels of Shiya Technology’s silicon-based OLED micro-display business as disclosed are as follows:

• January-June 2025
  : Overall gross margin was approximately
  26.55%
  (after excluding the impact of the sales allowance strategy for 0.6-inch products) [1]
• 2025 Full-Year Forecast
  : The gross margin of the silicon-based OLED micro-display business is projected to be
  27.26%
  [1]
• 2026 Forecast
  : Expected to reach
  25.14%
  [1]
• 2027 Forecast
  : Expected to further increase to
  30.12%
  [1]

:

1. The 58.5% figure may come from the gross margin of a specific high-end product line or a specific customer, rather than the overall business level
2. It may be confused with data from other silicon-based OLED manufacturers such as BOE
3. It may be the gross margin from the early R&D stage or small-batch products

• The global silicon-based OLED market size grew from RMB 390 million in 2020 to RMB 1.27 billion in 2024, with a compound annual growth rate (CAGR) of 34.3% [3]
• The market size is projected to reach
  RMB 67.93 billion
  by 2030 [3]
• The company’s silicon-based OLED business revenue grew 47.64% year-on-year in January-September 2025 [1]

• Key customers include industry leaders such as ByteDance, Thunderbird, Insta360, and Lanjing Innovation [1]
• The FPV (First-Person View) industry has strong demand, which highly aligns with the technical characteristics of silicon-based OLED [1]
• The expansion of new customers reduces the risk of reliance on a single customer [1]

• The revenue share of 1.03-inch large-size products continues to increase, driving the improvement of overall gross margin [1]
• The gross margin in 2024 increased significantly compared to 2023, mainly benefiting from the sales growth of 1.03-inch products [1]

• Mass sales of 0.6-inch products were achieved in 2025, but the overall gross margin slightly decreased due to the sales allowance strategy [1]
• As a strategic concession during the market development period, this may compress short-term profit margins [1]

• Fluctuations in the costs of upstream raw materials such as wafer backplanes
• Continuous increase in R&D investment (expected period expenses of RMB 375 million in 2025) [2]

• Panel giants such as BOE are also actively deploying in the silicon-based OLED field [4]
• As the market scale expands, more competitors will enter, increasing the risk of price wars

According to the forecasts in the company’s prospectus [1][2]:

Indicator	2025	2026	2027
Operating Revenue (hundred million RMB)	4.69	22.60	37.34
Gross Margin	27.26%	25.14%	30.12%
Net Profit	Expected loss narrowing	Turn profitable	Profit growth

1. Current Profitability
   : Shiya Technology is still in a
   loss-making state
   (net profit of -RMB 167 million in January-September 2025), but it is rapidly reducing its losses [1]

2. Gross Margin Sustainability
   :
   • The current gross margin level of approximately
     26-27%
     is within a reasonable range in the industry
   • With the
     release of economies of scale
     and
     optimization of product structure
     , there is room for medium- to long-term gross margin improvement
   • The
     58.5% gross margin level lacks official data support
     ; if it is data from a specific product line, attention should be paid to the revenue share and sustainability of that product line

3. Key Focus Areas for Investment Recommendations
   :
   • The company is expected to
     turn profitable in 2026
     [2]
   • Focus on the gross margin performance of
     1.03-inch and larger products
   • Track the
     progress of customer expansion
     and
     order backlog status
   • Pay attention to changes in the industry competition pattern, especially the strategic layout of giants such as BOE

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[1] Shanghai Stock Exchange - Prospectus for the Initial Public Offering of Shares by Shiya Technology Co., Ltd. (http://static.sse.com.cn/stock/disclosure/announcement/c/202512/002094_20251214_4FN8.pdf)
[2] Shanghai Stock Exchange - Shiya Technology IPO Application Documents (http://static.sse.com.cn/stock/disclosure/announcement/c/202510/002094_20251015_DHE2.pdf)
[3] Moomoo - Billion-Dollar Unicorn Loses Over RMB 900 Million, IPO Serves as a “Shot in the Arm” (https://www.moomoo.com/hans/news/post/63164408)
[4] Gelonghui - Silicon-Based OLED Industry Analysis (https://img3.gelonghui.com/)