Shares of XtalPi Holdings Limited (02228.HK) plummeted 5.16% in intraday trading on Thursday, despite the company reporting a turnaround to profitability for the first half of 2025. The AI-driven drug discovery company announced a net profit of RMB82.795 million for the six months ended June 30, 2025, compared to a net loss of RMB1.237 billion in the same period last year.

The stark contrast between the positive earnings report and the negative stock movement has left investors puzzled. Several factors could be contributing to the sell-off, including the possibility that the profit fell short of market expectations or concerns about the sustainability of the company's newfound profitability. Additionally, some investors may be taking profits following a potential run-up in the stock price ahead of the earnings announcement.

XtalPi's turnaround marks a significant milestone for the company, which has been investing heavily in AI-driven drug discovery technologies. While the company reported a basic earnings per share of RMB0.0151, it did not propose any dividend, which may have disappointed some income-focused investors. As the market digests this mixed news, analysts will be closely watching XtalPi's performance in the coming quarters to assess whether this profit trend can be maintained and expanded upon.