On August 26, LX Technology (02436), China's first publicly-listed DaaS (Device as a Service) company, released its interim results for 2025. The announcement shows that LX Technology's revenue increased approximately 18.5% year-over-year to 11.17 billion yuan (RMB) in the first half, while gross profit grew approximately 9.7% year-over-year to 102 million yuan. Net profit turned positive to approximately 5 million yuan, adjusted profit turned positive reaching approximately 18.645 million yuan, and adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) surged approximately 38.5% to 194 million yuan.

Overall, LX Technology delivered steady operational progress in the first half of 2025, presenting impressive revenue performance and outstanding profitability results. Notably, by revenue measure, LX Technology's first-half revenue reached a new historic high for the same period and continues to maintain its industry-leading position.

Since the beginning of this year, amid complex and profound changes in both domestic and international macroeconomic environments, LX Technology has maintained strategic focus, concentrated efforts on strategic planning, and continuously transformed positive factors in economic and market operations into development opportunities. The company achieved multi-dimensional release of business growth momentum with outstanding overall operational performance, establishing a solid foundation for high-quality development throughout the year.

Specifically, equipment recycling business revenue increased 24.4% year-over-year to approximately 8.48 billion yuan, equipment subscription service revenue grew 4.5% year-over-year to approximately 192 million yuan, and IT technical subscription services maintained steady development with revenue of approximately 76 million yuan. Total equipment subscription volume increased 11.7% year-over-year to approximately 3.475 million units.

Multiple institutions believe that under complex and challenging macroeconomic conditions, LX Technology forged ahead in the first half of 2025, continuously driving operational quality and efficiency improvements while consolidating excellent fundamentals, ultimately delivering outstanding results. This success can be attributed to at least two key factors worthy of market attention: first, LX Technology's full lifecycle equipment management business model possesses excellent capability to navigate complex cycles; second, LX Technology's management team has exceptional operational capabilities to handle complex situations.

In the first half of this year, LX Technology's net profit has turned positive. As the company continues to consolidate and expand its core competitive advantages while persistently enhancing customer service quality and efficiency to further strengthen customer satisfaction, its full-year performance is expected to impress the market and enter a phase of sustained, large-scale profitability in the coming years.

**Cultivating Strong Development Momentum, Core Business Continues Ascending Excellence**

Over the years, LX Technology has consistently focused on enhancing endogenous development capabilities and successfully built deep core competitiveness: first, the closed-loop DaaS ecosystem generates powerful synergistic effects; second, a comprehensive and robust recycling and refurbishment industrial chain provides strong support and synergistic effects for equipment subscription services; third, construction of industry-leading intelligent risk control systems, with the company maintaining consistently low bad debt rates; fourth, strong support from strategic shareholders.

These core competitive advantages have powerfully driven LX Technology's steady improvement in excellent fundamentals, enabling the company to maintain steady growth under complex economic conditions. In the first half of 2025, amid increasing economic uncertainties, LX Technology closely monitored, thoroughly researched, and precisely grasped evolving market and enterprise customer needs, keenly capturing positive factors therein. The company strategically cultivated strong development momentum, continuously and significantly improved customer service quality and efficiency, and enhanced enterprise customer experience and satisfaction, thereby further strengthening brand and customer loyalty and achieving continued steady growth in customer numbers.

Data shows that in the first half of 2025, LX Technology's core business customer metrics all achieved varying degrees of growth, with equipment recycling business customer numbers increasing approximately 20% year-over-year. Benefiting from this, LX Technology's core businesses continued their upward trajectory in the first half of the year. The announcement shows that equipment recycling business revenue increased significantly by 24.4% year-over-year, while equipment subscription service revenue grew 4.5% year-over-year with gross profit surging approximately 30% year-over-year.

Senior financial professionals believe that LX Technology has clear strategic judgment regarding DaaS market fundamentals and can precisely capture subtle changes occurring in the DaaS market under complex and challenging macroeconomic conditions. Based on this foundation, the company rapidly innovates and enriches DaaS service offerings, ensuring its core competitiveness maintains vigorous vitality, becoming an inexhaustible driving force for high-quality growth.

"Regarding DaaS market fundamentals, first, the trend of steady growth in national enterprise numbers remains unchanged. In 2024, China's registered enterprise numbers increased 5.1% year-over-year to 61.226 million, creating a solid foundation for further improvement in China's DaaS market penetration rate. Second, the trend of strong enterprise customer demand for DaaS services remains unchanged. In recent years, enterprises have faced significant operational pressure, highly prioritizing cost reduction, efficiency improvement, and cash flow, showing strong demand for comprehensive DaaS solutions for cost reduction and efficiency enhancement. Regarding new DaaS market developments, with the rapid development of artificial intelligence and computing power centers and other strategic emerging industries, related enterprises increasingly require DaaS services. The massive demand for DaaS services from AI and computing power markets may become important growth drivers for the DaaS market."

A relevant leader from LX Research Institute highly agrees with this assessment: "Based on precise judgment of DaaS market fundamentals and new situations, LX Technology consistently adheres to customer-centric service, implementing multiple measures to enhance customer service quality and efficiency, continuously creating new value for enterprise customers. One core initiative is continuously deepening digital intelligence construction to improve the company's lean management level."

LX Technology has been continuously undergoing digital transformation since 2018, comprehensively achieving barrier-free information flow throughout the company's internal value chain. Through data accumulation at various stages and analysis based on overall digital architecture, the company effectively supports various process controls, risk management, data analysis, and other operations, achieving more refined operational management.

Based on continuous big data accumulation, LX Technology has been continuously introducing advanced AI technology in recent years, continuously improving intelligent risk control systems, building proprietary AI customer service systems, and significantly enhancing operational and customer service quality and efficiency.

**Leveraging "Chain Leader Effect" to Strongly Promote Industry's High-Quality Entry into Trillion-Yuan Club**

Companies that gradually develop core cohesive capabilities across upstream, midstream, and downstream segments of an industry during industrial development are called "chain leader" enterprises. Multiple institutions point out that LX Technology, through over 20 years of innovative practice and high-quality development, has completely acquired the influence of a DaaS industry chain leader enterprise.

Two important milestones were successively leading the establishment of the industry's first forward-looking think tank "LX Research Institute" and the industry's first national platform "China Small and Medium Enterprise Association DaaS Service Professional Committee." Subsequently, LX Technology has transformed these two national industry think tank platforms into core windows for comprehensive and systematic understanding of the DaaS industry through continuous organization of high-level forums and publication of authoritative industry research reports.

Strengthening external deep understanding of the industry is a basic responsibility of DaaS industry chain leader enterprises. More importantly, it involves gradually popularizing and gaining market recognition for the strategic and economic value of DaaS services, promoting high-quality development of the DaaS industry. LX Technology understands this principle well, taking the lead in focusing on standard system construction and credit system construction, these two fundamental industry pillars, and producing fruitful results.

In recent years, LX Technology has actively promoted and deeply participated in dozens of credit system construction theme activities organized by various levels of government, and has successively participated in editing over ten standards, laying a solid foundation for steady improvement in DaaS market penetration rates.

In the first half of 2025, industry standard "Physical Leasing Terminology" and national standard "Grading Specifications for Usability of Second-hand Electronic Products," in which LX Technology participated as a core unit, were successively published and implemented, powerfully promoting DaaS industry standardization and mature development to new levels.

Notably, LX Technology has continuously led by example in recent years, promoting deep integration of the DaaS industry with national strategies and achieving fruitful results, creating a favorable atmosphere for steady improvement in DaaS market penetration rates.

In enterprise assistance, LX Technology's innovative digital closed-loop DaaS service model can help enterprises reduce 97.4% of initial investment and lower operational costs by approximately 30% within three years. To date, it has cumulatively helped tens of thousands of enterprises achieve cost reduction, efficiency improvement, and high-quality development.

In empowering "dual carbon" strategic goal achievement, LX Technology annually extends the usage cycle of millions of IT devices through industry-leading remanufacturing technology, reducing enterprise demand for new equipment during operations, thereby reducing tens of thousands of tons of carbon emissions annually. In 2024 alone, the company contributed over 83,740 tons of net carbon emission reduction to society.

In supporting rural education revitalization, LX Technology has donated substantial computers to township schools nationwide over many years, greatly facilitating rapid improvement in local smart education levels. In the first half of 2025 alone, the company successively donated and built 2 "computer classrooms" for primary and secondary schools in Guangdong mountainous areas.

These important initiatives by LX Technology have effectively promoted sustained high-quality growth in China's DaaS industry. Data from LX Research Institute and other institutions shows that over the past few years, under the intensive cultivation of leading enterprises like LX Technology, China's DaaS market has maintained a compound annual growth rate of over 30% and is expected to exceed 100 billion yuan in 2025, reaching 138.2 billion yuan in 2026, becoming an important force for China's high-quality economic growth.

Benefiting from this, LX Technology's main operating indicators have risen in sync with high-quality industry growth, with revenue maintaining high compound annual growth rates over the past few years, consistently ranking first in the industry for multiple consecutive years.

LX Technology's outstanding performance has created rich national strategic value, social value, and economic value, earning high recognition from governments at all levels. After being successively recognized as a National SME Public Service Demonstration Platform, National "Little Giant" Specialized and Sophisticated Enterprise, National High-tech Enterprise, and Shenzhen Multinational Corporation Headquarters Enterprise in recent years, LX Technology was further recognized by the Ministry of Commerce in the first half of 2025 as a National Service Industry Standardization Pilot (Commercial Circulation Special) Enterprise and one of the first national second-hand goods circulation pilot enterprises, making it the only enterprise in China's DaaS industry to receive this "dual recognition" from the Ministry of Commerce. Additionally, it was recognized as a "Shenzhen Gazelle Enterprise" by the Shenzhen SME Service Bureau.

**Institutions: Leading Enterprise Growth Expectations Materialization Inflection Point Emerged, Potential Growth Space Expected 20 Times**

Since the beginning of this year, with multiple targeted measures and precise policies implemented nationally, China's economic operation has maintained steady progress. This process has generated more positive factors and favorable conditions promoting continued high-quality development of the DaaS industry:

First, important legislation has further stimulated market vitality. In the first half of this year, following central-level private enterprise symposiums, the "Private Economy Promotion Law of the People's Republic of China" was officially implemented, powerfully stimulating private economic development vitality. Data shows that in the first half of 2025, the number of newly established private enterprises nationwide increased 4.6%. The continuously steady growth in enterprise numbers has further consolidated and expanded the foundation for high-quality growth in China's DaaS market.

Second, the in-depth implementation of major policies such as the "2025 Policy for Strengthening and Expanding Large-scale Equipment Updates and Consumer Goods Trade-in Programs" has further strengthened societal awareness of DaaS services.

Third, enterprises maintain stronger rigid demand trends for cost-reducing and efficiency-enhancing DaaS services.

Fourth, DaaS service providers are comprehensively introducing advanced AI technology, significantly improving operational and customer service quality and efficiency.

A relevant leader from LX Research Institute stated that benefiting from the continuous accumulation of positive factors and favorable conditions in macroeconomic operations, China's DaaS market penetration rate will reach an inflection point within the next five years: rising from the current approximately 5% to 10%. At that time, consumption consciousness and habits of various market participants will undergo tremendous changes, potentially prioritizing DaaS services when configuring IT office equipment. Against this backdrop, China's DaaS market scale will enter a sustained steady growth fast track.

"As the most leading enterprise in the DaaS market industry, LX Technology has steadily boarded this express train and will certainly benefit significantly," believe senior financial professionals. In recent years, LX Technology has been expanding the boundaries of its core competitiveness based on continuously strengthening core barriers. Its future market share will become increasingly higher, and its future revenue scale and profit levels have enormous potential.

As pointed out in Haitong International's research report, if LX Technology's market share increases by 1 times, the company's potential growth space would be 20 times.

"In the first half of this year, LX Technology's net profit has turned positive. This may indicate that the inflection point for gradual materialization of its growth expectations has emerged."

Looking ahead, with national policies continuously strengthening support for high-quality circular economy development, green consumption, and DaaS industry standardization construction, the DaaS industry has entered a transformation and upgrade period and will welcome structural growth. Against this backdrop, LX Technology, as the leading DaaS industry enterprise, will consistently adhere to customer-centric service, further expand key regional market layouts, focus on strengthening digital intelligence lean operations to improve overall operational efficiency and customer service quality of core businesses, continuously create more new value for customers, and enhance customer "satisfaction."

Simultaneously, LX Technology will continue to precisely grasp new development opportunities in macroeconomic operations, maintain high-quality growth, create sustainable value for shareholders, and make greater contributions to national high-quality economic development.