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Gigadevice Semiconductor Inc. (stock code: 603986, abbreviated as Gigadevice) hit its daily down limit on the A-share market today. As of the close, Gigadevice's A-share price stood at 390.63 yuan, giving it a market capitalization of 274.1 billion yuan. Meanwhile, its H-share price fell 17%, closing at 451.2 Hong Kong dollars, with a market cap of 316.6 billion Hong Kong dollars.
In early July 2026, Gigadevice's share price had reached a high of 846.66 yuan. This means that in less than a month, the A-share price has dropped by 54%, and over 320 billion yuan in market value has been erased.
Several core reasons are behind Gigadevice's sharp decline:
1. The Core Speculative Thesis Has Completely Collapsed. Gigadevice has a relationship with CXMT Corporation (688825), as both companies share the same founder, Zhu Yiming. Previously, significant capital flows treated Gigadevice as a “shadow stock” of CXMT, betting on the appreciation of its related equity holdings. However, following CXMT's listing on the STAR Market yesterday, which saw its shares soar 466% to a market cap of 3.3 trillion yuan, the value of Gigadevice's shadow-stock status has substantially diminished.
2. Massive Profit-Taking Pressure. Just one year ago, Gigadevice's share price was around 120 yuan. As the stock rallied to a peak of 846.66 yuan, a large number of profitable positions accumulated. As the entire sector enters a period of volatility, these accumulated profits have been released in concentrated selling pressure once the market direction turned.
3. Product Pricing at Historical Highs. Gigadevice had previously indicated that product prices were at an all-time high, and the trend of continued significant increases is unsustainable.
4. Global AI Capex Concerns. Meta's plan to sell off excess AI computing power and Nvidia's proposal to provide OpenAI with $250 billion in funding support have sparked fears of “circular financing.” This has raised concerns that global AI capital expenditure may have peaked, leading to a sustained correction in the memory chip sector recently.
Behind Gigadevice's continuous plunge, the so-called “tech herd funds” are believed to be collapsing, with the stock experiencing daily “ICU” visits. Some analysts point out that Gigadevice has 20 billion yuan in margin financing. If the stock were to hit the daily down limit for four consecutive days, a large number of these positions would likely be forced to liquidate.
Founder Zhu Yiming Cashes Out Over 4 Billion Yuan
As of March 31, 2026, Zhu Yiming held a 6.53% stake in Gigadevice. Other major shareholders included Hong Kong Securities Clearing Company Ltd. (5.9%), HKSCC Nominees Limited (4.74%), Ge Weidong (2.32%), and InfoGrid (2.32%).
As of March 31, 2026, the shareholder structure also included the China Construction Bank Corporation - E Fund CSI 300 ETF (1.1%), Wang Ping (1.08%), and the China CITIC Bank - Yongying Pioneer Semiconductor Smart Selection Mixed Securities Investment Fund (0.83%).
Gigadevice's actual controller, Zhu Yiming, reduced his stake by 0.49 percentage points between May 6 and 7, 2026. He then cut his holdings by another 0.91 percentage points from May 11 to 25, 2026. In total, Zhu Yiming sold 1.4 percentage points of his stake in Gigadevice during May 2026. Based on the stock price at the time, he cashed out approximately 4.7 billion yuan.