Transsion renews Hong Kong IPO application as Africa revenue rises
Shenzhen Transsion Holdings Co. Ltd. renewed its Hong Kong IPO filing, reporting a 25% revenue rise in Q1 2026 and a 7% rise in the second half of the prior year. Africa was its only growing market in 2025, while other regions declined. The company faces rising memory costs and patent litigation from Ericsson and InterDigital.
*this image is generated using AI for illustrative purposes only.
Shenzhen Transsion Holdings Co. Ltd. has renewed its application for a Hong Kong IPO, reporting that its revenue rose 25% in the first quarter of 2026 after returning to growth in the second half of last year. The budget smartphone maker controlled 61.5% of Africa’s smartphone market by unit shipments in 2024, but only 22.5% of the market by revenue, according to its preliminary prospectus filed last week. The filing complements its existing listing in Shanghai, where its stock has fallen 34% over the last 52 weeks.
The company’s financial performance shows a reversal of earlier declines. Revenue grew 7% in the second half of last year to 36.5 billion yuan from 34.1 billion yuan a year earlier. The growth rate accelerated to 25% in the first quarter of this year, with revenue rising to 16.2 billion yuan from 13 billion yuan a year earlier. Gross margin also rebounded to 22.0% in the first quarter from 19.3% a year earlier.
Financial Performance
| Period | Revenue (billion yuan) | Change | Gross Margin |
|---|---|---|---|
| Second half of last year | 36.5 | +7% | - |
| First quarter of this year | 16.2 | +25% | 22.0% |
| First quarter previous year | 13.0 | - | 19.3% |
Profitability has been volatile. Profit fell 53% to 2.61 billion yuan last year from 5.6 billion yuan in 2024, largely due to drops in other income and gains. However, profit rose 43% in the first quarter of this year to 700 million yuan from 490 million yuan a year earlier.
Market Position and Costs
Transsion has shifted its focus toward smartphones, which accounted for about 84% of revenue in 2025, while feature phones made up just 5.5%. The average selling price (ASP) for its smartphones rose to 566 yuan ($83.62) last year from 544 yuan in 2024, driven by rising memory costs. Memory chip costs rose about 10% last year, accounting for 28% of raw material costs, up from 21% in 2023.
Geographically, Africa was the company’s only major market where revenue rose last year, climbing nearly 10% to make up about 38% of sales. Revenue from Emerging Asia Pacific markets fell 3.6% to make up 36% of sales, while the Middle East and Latin America fell 7.1% and 24%, respectively.
Legal and Regulatory Challenges
Transsion faces patent infringement lawsuits in Europe and Southeast Asia filed by Ericsson and InterDigital in 2025 and 2026. China’s securities regulator requested additional information about the litigation in April, potentially creating a hurdle for approval from the China Securities Regulatory Commission for the Hong Kong IPO.
How will the ongoing patent infringement lawsuits in Europe and Southeast Asia impact Transsion's ability to expand beyond its dominant African market?
Can the company sustain its recent gross margin recovery if memory chip costs continue to rise?
Will the Hong Kong IPO valuation be heavily discounted given the 34% decline in its Shanghai-listed stock over the past year?
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