On August 22, Manycore updated its prospectus and submitted its second listing application to the Hong Kong Stock Exchange, with JPMorgan Chase and China Construction Bank International serving as joint sponsors.

According to the prospectus, Manycore plans to use the fundraising proceeds for: implementing the company's international expansion strategy; enhancing existing product functions and launching new products and/or features to meet demands in real-world spaces and virtual environments; supporting domestic sales and marketing activities and enhancing brand awareness; investing in core technology and infrastructure; working capital and general corporate purposes.

It's clear that Manycore's primary purpose for listing and fundraising is to drive global business expansion. However, paradoxically, in recent years, Manycore has aggressively pursued layoffs and cost-cutting measures. Its R&D expense ratio plummeted from 72.9% in 2022 to 44.7% in 2024, and further declined to 37.5% in the first half of 2025. During the same period, the sales expense ratio also dropped from 53.4% to 33.9%.

In the first half of 2025, Manycore's adjusted net profit finally turned from loss to profit. However, net operating cash flow remained negative, with cumulative net outflows of 549 million yuan since 2022. More critically, since the E+ round financing in October 2021, Manycore has not secured any new funding, suggesting capital markets may have lost interest. As of the end of June 2025, redemption liabilities approached 4 billion yuan.

For Manycore, listing and fundraising is not the icing on the cake, but a lifeline.

**Nearly 4 Billion Yuan Redemption Debt Looming**

Manycore is a leading cloud-native spatial design software provider, with products widely used in business scenarios ranging from residential and office buildings to retail stores and commercial projects. The company's software is powered by artificial intelligence (AI) technology and dedicated graphics processing unit (GPU) clusters, enabling designers and businesses to create engaging designs and experience them through real-time and immersive visual effects.

Manycore owns spatial design software "Kujiale" and its overseas version "Coohom," the Manycore Spatial Intelligence Platform "SpatialVerse," and spatial design BIM software "Manycore Cool Space." Its products cover over 200 countries and regions globally, making it the world's largest spatial design platform. According to Frost & Sullivan data, by 2024 revenue, the company is China's largest spatial design software provider, accounting for approximately 23.2% market share.

According to the prospectus, from 2013-2021, Manycore completed 11 rounds of financing totaling $295 million, equivalent to approximately 2.113 billion yuan. Compared to the first round's share price, by the E+ round, the cost per share had increased 145 times.

Manycore's investors include GGV Capital, Shunwei Capital, New Gultar, Hillhouse, MPC, Coatue entities, Hearst entities, Qingting Investments, CITIC Hong Kong, Yun Qi entities, Aquanauts 3820 III L.P., and others.

Notably, Manycore's Chief Financial Officer Shen Bei has played a key role in the company's financing and investment planning. Shen Bei has over 20 years of experience in the financial industry, having worked at JPMorgan Chase and Citigroup. In 2019, he joined Manycore as CFO, responsible for investment planning and management as well as financing matters. In June 2021, Shen Bei first joined Manycore's board of directors as an executive director.

During 2022-2024 and the first half of 2025 (referred to as the "reporting period"), Shen Bei's compensation was 6.551 million yuan, 5.018 million yuan, 3.466 million yuan, and 1.157 million yuan respectively, approximately several times that of the three founders during the same periods. Share-based payments were 6.012 million yuan, 4.063 million yuan, 2.604 million yuan, and 540,000 yuan respectively.

Manycore has multiple overseas investment entities, possibly related to its previous plans for US listing. On June 25, 2021, Manycore applied for listing with the US Securities and Exchange Commission. At that time, Manycore also proposed the concept of "first 3D cloud design stock," but officially announced abandoning its US listing plan on February 13, 2023.

Since the E+ round in October 2021, Manycore has not secured any new financing, indicating its diminishing appeal to capital. Without timely fundraising for "blood transfusion," based on the company's current cost expenditure, it may struggle to maintain normal operations.

On February 14, 2025, Manycore turned to Hong Kong's capital market, submitting a listing application to the Stock Exchange. In April, it received requirements for supplementary materials from the CSRC for overseas issuance and listing filing, but as of now, its overseas listing filing status remains "supplementary materials."

During Manycore's lengthy financing process, the company granted investors a series of special rights including information rights, director election rights, anti-dilution rights, drag-along rights, withdrawal rights, preemptive purchase rights, tag-along rights, redemption rights, and requirements for prior approval from preferred shareholders. However, once Manycore successfully lists on the Stock Exchange, all these special rights will immediately become invalid.

On December 17, 2024, Manycore reached a new agreement with investors: the redemption and withdrawal rights originally enjoyed by investors automatically terminated the moment Manycore submitted its listing application to the Hong Kong Stock Exchange. However, if Manycore withdraws its listing application, or if the listing application is withdrawn, rejected, or returned by the Stock Exchange, or if the listing application expires within three months without renewal, or if Manycore fails to complete a qualified listing as defined in the shareholders' agreement within 18 months after submitting the listing application, then the redemption and withdrawal rights will automatically restore.

As of the end of June 2025, Manycore's redemption liabilities reached 3.938 billion yuan, accounting for 86.97% of total current liabilities. After excluding the impact of redemption liabilities, the company's total assets were 547 million yuan, total liabilities were 665 million yuan, with an asset-liability ratio still as high as 121.56%, facing the risk of insolvency.

Another major reason for Manycore's high liabilities is deferred revenue, which represents prepayments received from customers for future delivery of subscriptions or professional services. During the reporting period, deferred revenue under current and non-current liabilities was 507 million yuan, 617 million yuan, 592 million yuan, and 535 million yuan respectively.

**Turning Profitable Through Expense Reduction, Customers Mainly from Real Estate Industry**

In recent years, Manycore has shown rapid development momentum with fast revenue growth, but still hasn't achieved profitability.

During the reporting period, Manycore achieved operating revenues of 601 million yuan, 664 million yuan, 755 million yuan, and 399 million yuan respectively. It recorded net losses of 704 million yuan, 646 million yuan, 513 million yuan, and 226 million yuan respectively, totaling 2.089 billion yuan in net losses. Including foreign exchange losses, total losses would reach 2.377 billion yuan. Under non-IFRS standards, adjusted net profits were -338 million yuan, -242 million yuan, 70 million yuan, and 18 million yuan respectively, totaling 667 million yuan in net losses.

However, in the first half of 2025, although Manycore achieved a turnaround from loss to profit (based on adjusted net profit), net operating cash flow remained at -76.136 million yuan. Combined with 2022-2024 operating cash net outflows of 473 million yuan, this reflects poor "blood-making" capability. As of the end of June 2025, Manycore's time deposits (including non-current asset portions), cash and cash equivalents totaled 419 million yuan, indicating most of the over 2 billion yuan in financing has been "burned through."

In fact, Manycore's narrowing losses primarily stem from reduced expenditures.

During the reporting period, Manycore's R&D expenses were 438 million yuan, 391 million yuan, 337 million yuan, and 150 million yuan respectively, with R&D expense ratios of 72.9%, 58.9%, 44.7%, and 37.5% respectively. Sales and marketing expenses were 321 million yuan, 356 million yuan, 326 million yuan, and 135 million yuan respectively, with sales expense ratios of 53.4%, 53.7%, 43.3%, and 33.9% respectively.

It's evident that Manycore has compressed R&D and marketing expenses for "cost-cutting," but high operating expenses remain the main reason for consuming gross profit and causing losses.

However, what's puzzling is that while Manycore continues layoffs and cost reduction to narrow losses, it plans to use most of the fundraising proceeds for business expansion, including increasing marketing and R&D expenses and expanding sales and R&D teams.

According to the prospectus, Manycore plans to focus on South Korea, Southeast Asia, India, the United States, and Japan as primary markets, establishing localized sales networks and building a specialized sales team of approximately 250 sales professionals. Meanwhile, it will use part of the fundraising for marketing activities, including hosting seminars, participating in institutional events, and strengthening digital marketing efforts, with annual marketing budgets of approximately 20 million yuan for the next three to five years.

Manycore also plans to expand R&D teams focused on AIGC and geometric modeling, e-commerce, embodied artificial intelligence, and spatial intelligence. Over the next three to five years, team size will grow to 60-75 personnel. It also plans to add approximately 3,000 servers and invest in establishing self-operated data centers to host additional GPU clusters.

Although Manycore vigorously claims future market prospects are bright, it's important to note that its core customers are mainly interior design and architecture companies, furniture manufacturers and retailers, and other real estate upstream and downstream enterprises. During the golden period of real estate development, this model might have captured a share of frantic expansion, but with the current real estate industry downturn and developers urgently contracting and postponing land acquisition, design companies still face difficult payment collection, which will inevitably impact the company's future operations.

According to National Bureau of Statistics data, national new home sales in 2024 were 967.5 billion yuan, down 17.1% year-over-year. AVC data for 2024 shows the home decoration market scale declined 16.8%, with the overall industry showing contraction trends.

Possibly affected by downstream real estate industry demand contraction, during the reporting period, Manycore's subscription revenue per enterprise customer was 14,800 yuan, 13,700 yuan, 13,600 yuan, and 14,000 yuan respectively. Enterprise customer net revenue retention rates were 112.3%, 106.0%, 103.4%, and 101.6% respectively, all showing declining trends.