ChinaBiz Briefing | EV Margin Crunch, CXMT Snubs Apple, Momenta's $9B IPO

China's technology and industrial sectors are undergoing simultaneous inflection points on July 7, 2026. EV startups are discovering that volume without profitability is a liability, not an asset. A domestic chipmaker is rewriting the rules of supplier-customer power. An autonomous driving software company is making the case that royalties beat engineering contracts. And China's robotics boom is about to meet its first public-market reality check. Taken together, these stories mark a single macro shift: Chinese tech is moving from growth-at-any-cost toward a harder question — who actually makes money?

China's EV Startups Post Record Sales — and Miss Every Annual Target

Not one of China's leading EV startups has crossed the halfway mark on its 2026 delivery target at the midpoint of the year. Leapmotor led the pack with 356,487 H1 units — up 61.2% year-on-year — but its Q1 gross margin collapsed 550 basis points to 9.4%, producing a net loss of RMB 390 million (US$54M). Li Auto, the only major player posting negative volume growth (down 5.1% to 193,500 units), saw its vehicle gross margin crater from 19.8% to 6.1%, swinging to a net loss of RMB 2.3 billion (US$319M).

Why it matters: China's NEV penetration hit 57.4% in H1 and breached 63% in June alone — a threshold that signals the market has crossed from adoption into zero-sum competition. Incremental volume no longer differentiates winners. The new benchmark is unit economics, and by that measure, no major startup has yet passed. H2 forces a binary: chase volume targets through discounting and sacrifice more margin, or revise guidance downward and defend the balance sheet.

CXMT Puts Xiaomi and Alibaba Ahead of Apple in Its DRAM Queue

China's sole advanced DRAM producer, Chang Xin Memory Technologies (CXMT), has locked approximately US$3 billion in long-term supply agreements with domestic clients — including Tencent, Alibaba Cloud, ByteDance, and Xiaomi — leaving Apple, which has lobbied Washington for a procurement waiver to access CXMT chips, at the back of the queue. CXMT is China's only manufacturer capable of volume production across DDR4, DDR5, and LPDDR5, making it the only domestic alternative to Samsung and SK Hynix for customers scaling AI inference workloads.

Why it matters: This is a structural inversion of the power dynamic that has historically defined Apple's relationships with Chinese component suppliers. CXMT's caution is grounded in institutional memory — Goertek and O-Film both suffered near-fatal revenue collapses after Apple removed them from its supply chain — and in regulatory risk: a U.S. export control ruling could void any Apple-linked capacity commitment overnight. As CXMT's roadmap shifts toward server-grade DDR for China's AI infrastructure build-out, its strategic alignment with domestic hyperscalers deepens further, reducing the imperative to accommodate Apple's procurement cycles.

Even Realities Raises $150M at $1.2B Valuation, Backed by Meituan and Tencent

Shenzhen-based smart glasses startup Even Realities closed a US$150 million Pre-B round co-led by Meituan and Tencent, reaching a US$1.2 billion post-money valuation roughly 30 months after founding. The company's flagship G2 — a camera-free, 36-gram Micro LED display device priced at US$599, rising to approximately US$1,000 when bundled with its R1 smart ring — targets enterprise professionals, with over half its user base in the United States. Weekly active usage exceeds 90%.

Why it matters: The global smart glasses market is bifurcating between camera-equipped social devices (Meta commands ~70% share) and display-forward, privacy-compliant productivity tools. Even Realities is the most credible funded bet on the latter axis, and Meituan's participation through both its financial and strategic investment arms signals ecosystem ambitions beyond a pure financial return. The company turned profitable after its first product and has not yet entered China's domestic market — suggesting a deliberate sequencing toward margin-rich Western markets first.

Momenta Launches $9B Hong Kong IPO, Reframing Autonomous Driving as a Royalty Business

Momenta cleared its Hong Kong Stock Exchange listing hearing and launched its IPO at HK$295.6 per share (code: 6880), targeting gross proceeds of HK$5.89 billion (US$754M) at a pre-greenshoe market cap of approximately US$9 billion. Cornerstone investors include GIC (US$100M), Fidelity International (US$100M), BlackRock, Oaktree, Mercedes-Benz, and BYD. The financial case is built on a revenue mix shift: licensing royalties — charged per vehicle equipped with Momenta's software — rose from 3.2% of revenue in 2023 to 40.1% in 2025, driving gross margin from 17.5% to 71.6%. Adjusted net loss narrowed 72% to RMB 303 million (US$42M) over the same period.

Why it matters: Momenta is the first pure-play autonomous driving software company to establish a public price-to-sales benchmark at this scale, ahead of Haomo.AI, QCraft, and others. Its data flywheel — 680,000 production vehicles generating 630,000 data clips per day — creates a compounding moat that explains why its IPO valuation is roughly double that of Pony.ai. Nine of the world's ten largest automakers are active clients. The critical risk: top five clients still represent 62.6% of revenue. Adjusted profitability and positive operating cash flow are both projected for 2026; those milestones will determine whether the platform premium holds.

Unitree's CSRC Approval Triggers a Valuation Reckoning Across China's Robotics Boom

China's securities regulator has approved Unitree Robotics' IPO registration for a STAR Market listing, the final hurdle before share issuance. Unitree — which shipped more than 5,500 robots in 2025, making it the world's top-selling robotics manufacturer by unit volume — is profitable and implies a market cap of RMB 42 billion (US$5.83B), with analysts projecting a post-listing valuation of RMB 109 billion (US$15.1B) at 32x sales. Two peers are also approaching public markets: DEEP Robotics (quadruped industrial robots, profitable, 41x implied P/S) and Leju Robotics (humanoid-focused, loss-making, breakeven not expected until 2028).

Why it matters: China's robotics primary market absorbed more than RMB 102.5 billion (US$14.2B) in H1 2026 alone, priced largely on TAM projections rather than commercial fundamentals. Once Unitree, DEEP, and Leju trade publicly, institutional investors will have three auditable, segmented benchmarks. Startups without batch delivery capability or a credible revenue path will face sharply narrowing financing windows. The top five embodied-intelligence companies already captured 37% of all H1 sector funding; the Matthew Effect is compressing the timeline for late entrants faster than the EV shakeout did at a comparable stage.

What to watch next: Li Auto's H2 guidance revision and whether it can defend its extended-range SUV franchise while funding a pure-EV push simultaneously. CXMT's capacity roadmap as it pivots further toward server-grade DRAM for AI infrastructure. Momenta's first post-IPO earnings report, which will either validate or challenge the platform premium the market has priced in. And the pace at which Unitree's public valuation becomes the forcing function that triggers consolidation among China's 200-plus second-tier robotics startups.

Related Coverage:

China’s Robot Exports Hit RMB 19.99 Billion, Break Into Germany and JapanEven Realities Raises $150M Pre-B Round at $1.2B Valuation, Backed by Meituan and TencentChina's EV Startups Post Stronger Sales but Every Major Player Misses Half-Year TargetChina's Humanoid Robot IPO Wave Forces a Valuation Reckoning Across the Sector
Momenta’s $9B IPO Turns Autonomous Driving Into a Royalty Platform StoryCXMT Reorders DRAM Supply, Putting Xiaomi and Alibaba Ahead of Apple