IPO New Observation | IPO Key Period Faces 25 Million Claims: What’s Next for Taosheng Technology

Want to list on the STAR Market? Pay a first penalty of 25 million yuan!

On March 31, during its IPO process, semiconductor testing equipment provider Taosheng Technology suddenly ran into a “technology” lawsuit—a claim by Qianggyi Co., Ltd. that its subsidiary recruited employees with access to trade secrets, seeking damages of more than 25M yuan.

Qianggyi filed claims, asking the court to order an injunction against the acts that infringed the relevant technical secrets, and to order Taosheng Technology and its wholly owned subsidiary Suzhou Jingsheng to jointly compensate the plaintiff for infringement losses of 25.08M yuan. The compensation amount was determined based on a reasonable forecast derived from Taosheng Technology’s prospectus: the sales revenue for the MEMS probe card business in 2024 and the sales revenue for January–June 2025.

It is worth noting that in the first half of this year, Taosheng Technology’s gross margin for the probe card business has narrowed to less than 1%. Its wafer testing business (i.e., the R&D, production, and sales of probe cards) has continued to incur losses, yet the prospectus states that it “has achieved breakthrough results.”

What specific technical secrets are Qianggyi accusing Taosheng Technology and Suzhou Jingsheng of infringing? What “breakthrough results” did Taosheng Technology mention? The Beike Finance reporter contacted the two companies separately by phone and email; as of the time of writing, no reply had been received.

Recruiting employees with access to trade secrets in a subsidiary? Qianggyi sues

On March 31, Qianggyi said that, because its technical secrets were infringed, the company proactively brought a lawsuit. It sued Shanghai Taosheng Electronic Technology Co., Ltd. (hereinafter “Taosheng Technology”) and its wholly owned subsidiary Suzhou Jingsheng Micro-Nano Semiconductor Technology Co., Ltd. (hereinafter “Suzhou Jingsheng”).

According to the announcement, Qianggyi is a leading player in market position, holding proprietary MEMS probe manufacturing technology and able to produce MEMS probe cards in volume, breaking the monopoly held by overseas manufacturers in the MEMS probe card field. Suzhou Jingsheng recruited employees who previously worked at Qianggyi and who possessed Qianggyi’s alleged technical secrets and had confidentiality obligations.

After investigation, Taosheng Technology and Suzhou Jingsheng’s multiple core technologies are substantially similar to the technical secrets that Qianggyi claims to protect, and they are suspected of infringing Qianggyi’s technical secrets and violating the provisions of the Anti-Unfair Competition Law of the People’s Republic of China.

“As of now, the case has not yet been tried in court. The specific impact of this lawsuit on the company’s current-period profits or profits in future periods remains uncertain. The final actual impact will depend on the court’s judgment and enforcement situation.” Qianggyi said that this lawsuit is one the company proactively filed because it believes its technical secrets have been infringed. It is a legitimate measure the company took to protect its own lawful rights and interests.

Taosheng Technology was established in 2007, with registered capital of 32.7992 million yuan. The actual controller is Yin Lanyong. The company focuses on the semiconductor testing interface field. Suzhou Jingsheng is a wholly owned subsidiary of Taosheng Technology, established in 2021, and its legal representative is Yin Lanyong.

Qianggyi was established in 2015, with registered capital of 129.5593 million yuan. The actual controller is Zhou Ming. It conducts R&D and production of semiconductor chip testing probe cards.

On December 30, 2025, Qianggyi successfully listed on the STAR Market. On the same day, the Shanghai Stock Exchange accepted the listing application materials of Taosheng Technology, and on January 21 this year, it entered the inquiry stage.

In its prospectus, Qianggyi mentioned that the company’s business categories are probe cards, with customers mainly consisting of participants in China’s semiconductor industry. It directly competes with overseas manufacturers FormFactor, Technoprobe, MJC, JEM, Wanshi Technology, and China Testing & Measurement, among others. Its global market share exceeds 3%.

The aforementioned prospectus states that Taosheng Technology’s business categories are probe cards and testing sockets. The business is relatively comprehensive, mainly testing sockets, and it gradually expands into probe-card-related businesses. Its global market share is lower than Qianggyi’s.

Breakthrough results in MEMS probe card R&D? Last first half of the year, probe card business gross margin was below 1%

Taosheng Technology focuses on the semiconductor testing interface field. Its main products include chip testing interfaces, probe cards, and so on. It provides key testing hardware solutions for customers across downstream industry links such as chip design, wafer manufacturing, and packaging and testing.

The prospectus shows that from 2022 to 2024 and in the first half of 2025, Taosheng Technology’s chip testing interface business revenue was always more than 80%. The probe card business accounted for 6%–11% of revenue, and the testing equipment business accounted for 3%–10%.

Taosheng Technology’s breakdown of revenue by business segment. Screenshot from the prospectus

Over the past four years, Taosheng Technology’s revenue has grown steadily, but its net profit has fluctuated. From 2022 to 2024, the company achieved revenue of 165 million yuan, 209 million yuan, and 331 million yuan, respectively. However, in 2023 it recorded a net loss of 8.1316 million yuan. In 2024 it returned to profitability, achieving an attributable net profit of 12.1427 million yuan, which still fell short of the 2022 level. In the first half of 2025, Taosheng Technology achieved revenue of 192 million yuan, and an attributable net profit of 8.4020 million yuan.

The Beike Finance reporter noted that the net losses of the wafer testing business (i.e., the R&D, production, and sales of probe cards) have been widening year by year. The financial reports show that in 2022–2024 the business recorded net losses of 16.1343 million yuan, 32.0698 million yuan, and 40.7490 million yuan, respectively. In the first half of 2025, the net loss was 21.9708 million yuan.

Taosheng Technology’s operating performance. Screenshot from the prospectus

Taosheng Technology said that it maintains high-intensity R&D investment in the probe card business. With R&D results gradually being industrialized and implemented, the sales revenue generated from the probe card business has grown rapidly—especially in the MEMS probe card business. Sales revenue grew from 1.7895 million yuan in 2022 to 17.3368 million yuan in 2024, becoming a new revenue growth point.

From 2022 to 2024, the sales volume of MEMS probe cards gradually increased, and sales revenue rose from 1.7895 million yuan to 17.3368 million yuan. The average selling price increased from 63.9k yuan per unit to 194.8k yuan per unit. In the first half of 2025, MEMS probe card sales revenue was 3.8706 million yuan, and the selling price fell to 49.6k yuan per unit.

“During the reporting period, the company achieved breakthrough results in R&D of MEMS probe cards, and successfully obtained recognition from well-known semiconductor customers such as Yangtze Memory, customer Z, and A-Guang Circuit (Aofei). Sales revenue achieved a significant increase.” Taosheng Technology said that in 2023 and 2024, the prices of the MEMS probe cards sold by the company were relatively high, mainly because customers such as customer Z and A-Guang Circuit had relatively complex wafer testing requirements, with a large number of probes mounted on each probe card, resulting in a higher selling price of probe cards than that of other orders.

Taosheng Technology’s gross margin by business segment. Screenshot from the prospectus

Judging by gross margins, the chip testing interface business gross margin exceeded 40% in 2022, 2024, and the first half of 2025, while the probe card business gross margin narrowed year by year. In 2022–2024 and the first half of 2025, the gross margins were 21.20%, 7.55%, 1.23%, and 0.66%, respectively.

By contrast, the probe card business is Qianggyi’s main business. The prospectus shows that in 2022–2024 and the first half of 2025, MEMS probe card revenue was 136 million yuan, 235 million yuan, 510 million yuan, and 326 million yuan, respectively, accounting for 53.51%, 66.23%, 79.49%, and 87.01% of operating revenue, respectively, driving the company’s operating revenue to grow rapidly.

“Impacted by factors such as the acceleration of domestic substitution for probe cards and the increase in the revenue share of MEMS probe cards with relatively high gross margins of the company, (in 2022–2024 and the first half of 2025) the company’s gross margin was 40.78%, 46.39%, 61.66%, and 68.99%, respectively.” Qianggyi said.

The actual controller is an engineer by training; before the IPO, he signed a “betting” agreement

Yin Lanyong, a “post-70s” generation, as shown in his résumé, studied at Southeast University and Canada’s Western Ontario University, receiving a bachelor’s degree and a master’s degree in business administration, respectively. He previously worked at Motorola Systems (China) Co., Ltd., serving in roles including semiconductor division testing engineer, system integration engineer, and wafer testing engineer. He also served as a sales manager at Electroglas International Inc.

In terms of equity structure, Taosheng Technology’s largest shareholder, i.e., the actual controller Yin Lanyong, holds a total of 44.83% of the company’s shares. He directly holds 28.40% of the shares, and also controls 14.42% of the shares through Suzhou Houji, and controls 2.01% of the shares through Haori Changjing.

Yin Lanyong also serves as the company’s chairman, general manager, and chief operating officer, while Gao Kai serves as deputy general manager of Taosheng in Hong Kong.

The prospectus shows that before this issuance, Taosheng Technology’s total share capital is 32.7993 million shares. The company plans to publicly issue no more than 10.9331 million shares, not less than 25% of the total share capital after the issuance.

The funds raised in this offering will be invested in: the construction project of the Suzhou Taosheng semiconductor testing interface and testing probe production base; the construction project of the Suzhou Jingsheng wafer testing probe R&D and wafer testing probe card production base; the Shanghai headquarters and R&D center construction project; the Tianjin Taosheng R&D center project; and supplemental working capital.

Since its establishment, Taosheng Technology has completed Series C financing. Investors include Yida Capital, Anhui Railway Investment, Jiangsu Hi-Tech Investment, Kunshan Guoke Investment, Suzhou Zhanxin Fund, Fudan Innovation & Entrepreneurship Investment, Shangqi Capital, Junxin Capital, and others.

On March 18, 2025, some shareholders of Taosheng Technology signed a “Shareholders’ Agreement,” in which the performance-bet clauses stipulated that Taosheng Technology must complete a qualified IPO by December 31, 2028; otherwise, it will trigger a share repurchase. The repurchase obligors are Yin Lanyong, Gao Kai, Suzhou Houji, and Haori Changjing.

Beijing News Beike Finance reporter Xu Yuting | Editor Chen Li | Proofreader Mu Xiangtong

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