One of the Chinese giants in the artificial intelligence server manufacturing sector, xFusion, has made an essential step toward a likely high-impact initial public offering, which strengthens the increased self-reliant artificial-intelligence hardware ecosystem being pursued by the country.
As per a filing submitted to China Securities Regulatory Commission, Huawei spin-off has hired Citic Securities on 31 December to provide executive-level compliance and corporate-governance advice, a mandatory pre-requisite to a domestic IPO.
This is putting the xFusion in a growing group of Chinese AI firms waiting in line to take advantage of the now stronger capital markets.
From Huawei Spin-Off to Market Leader
Since the restructuring of Huawei in 2021-2022 as a result of US sanctions, xFusion announced revenues of over 40 billion yuan ($5.72 billion) in 2024.
The company has risen to become a powerhouse in providing AI servers to telecom operators, financial organizations, online platforms, and governmental organizations with its products being sold in over 100 countries. State underlying investors in the company shareholders include China Telecom Group Investment and China Mobile Capital.
There have been numerous occasions when xFusion is proposed as a major element of provincial computing infrastructure, with Henan provincial authorities aligning with the overall approach of Beijing to reduce its dependence on foreign technology as U.S export controls tightened its grip on access to high-end chips.
AI Sector Rally Surge IPO Expectations
The endeavors of XFusion to take an initial public offering coincide with the intensification of the AI industry in China.
The CSI AI Index (CSI 930713) rose by 67% over 2025, as investor interest in domestic alternatives to U.S semiconductor manufactures. The recent listings have been volatile but with high returns.
Developers of AI chips Biren Technology, Moore Threads, and MetaX have enjoyed very strong valuations, with their market entries suggesting that AI hardware-oriented companies can become the investors of high-valuation targets.
Bold Road Ahead
However, there are still residual risks. Sanctions imposed by the U.S. can restrict foreign growth, and the domestic environment can grow by enhancing the competition in the country, consequently lowering the profit margins.
However, reports suggest a successful IPO could value xFusion at close to $14 billion and a listing on Shanghai or Hong Kong may be an option by mid 2026.
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