Xunce Technology H1 Revenue Surges 389% with nearly RMB 100mn Profit; Token Commercialization Far Outpaces Expectations

The Hong Kong stock market’s AI sector boasts no shortage of standout names, yet it lacks a genuine performance benchmark that delivers tangible results.

On July 31, Xunce Technology (3317.HK, “Company”) unveiled its latest business results: revenue surged nearly four times, the Company secured first-half profitability for the first time in its decade-long history, gross margins remained elevated, and annual recurring revenue (ARR) from Token services jumped 410% quarter-over-quarter.

Taken together, no other player in Hong Kong’s AI sector can match this set of metrics. As the first player to deliver material earnings growth, Xunce Technology has effectively demonstrated a viable commercial AI business model.

All Core Metrics Show Strong Momentum

Driven by rapidly rising demand for enterprise-level real-time AI data infrastructure and analytics, Xunce Technology outperformed market expectations in the first half of 2026. The Company released its trading update on July 31, reporting H1 revenue of RMB 970 million, representing a year-over-year increase of 389% and hitting an all-time high for the period. This robust topline growth stems not from a single catalyst, but from five mutually reinforcing drivers: surging enterprise demand for AI implementation, accelerated penetration across industries, faster deployment of TokenOS, successful commercialization of its Token business model, international expansion and ecosystem development.

Revenue generated via the Token business model has exceeded 10% of total turnover. The ARR from Token services leapt 410% QoQ in June, with commercial progress far outstripping forecasts. Accelerated deployment of the TokenONE operating system is fueling exponential growth in data Token consumption. The Company projects Token-related revenue will account for 20% to 30% of total revenue by year-end.

Revenue reached RMB 970 million, surging 389% year-on-year to hit an all-time high for the period. Net profit attributable to owners stood at RMB 72.51 million, compared with a net loss of RMB 89 million in the prior-year period, marking the Company’s first profitable first half. Adjusted net profit amounted to RMB 67 million, versus a net loss of RMB 105 million recorded a year earlier, representing a substantial turnaround from losses to profitability.

The scale of this turnaround has exceeded broad expectations, signaling the Company’s transition from an investment phase to a period of earnings realization.

The turnaround and profit growth can be traced to three key factors. First, higher margin revenue streams now make up an increasing share of total income, driving an improved revenue mix and stronger profitability. Second, the platform-based and modularized product architecture unlocks economies of scale. R&D, sales and administrative expense ratios improved versus the prior-year period, with operating leverage kicking in at an accelerated pace. Third, enhanced capital management generated incremental investment income, further boosting profits for the period.

Five Growth Drivers behind the Strong Results

Enterprise demand for practical AI deployment is surging, shifting from experimental spending to critical business demand. Even so, effective deployment of large language models (LLMs) in specialized use cases including financial risk control, industrial quality inspection and energy scheduling remains constrained by three hurdles: data governance, real-time data provision, and security compliance. Enterprises are moving beyond simply purchasing model APIs, rather, they are systematically building data infrastructure to bridge the gap between private domain data and model-ready datasets. As AI applications expand from general use cases to specialized commercial scenarios, demand for high-quality, scenario-specific data infrastructure is growing exponentially.

TokenOS unlocks new upside for Token-driven commercialization. In May, Xunce Technology launched TokenONE, the world’s first TokenOS operating system, a platform that converts heterogeneous enterprise data into measurable and priceable vertical scenario Tokens in real time. Powered by exclusive private domain data, millisecond-level response speed and a decade of industry knowhow accumulated, its scenario Token pricing ranges from $10 to $100 per million tokens, over ten times the rates for generic LLM tokens. CITIC Securities characterizes the platform as a “data flow operating system”, highlighting its core strength: delivering millisecond-scale data governance and AI-ready outputs for high-frequency decision-making scenarios such as finance and energy.

The Token business model has been validated, delivering blistering ARR expansion. Under this pricing framework, revenue is driven by four multipliers: unit pricing, call frequency, module quantity and customer scale, removing constraints of linear growth. Surging Token consumption has fueled sharp ARR rises: approximately 300% month-over-month growth in April, 320% in May, and a 410% quarter-over-quarter jump in June, reflecting continuously accelerating momentum.

Penetration across multiple sectors is accelerating, with proven capacity to replicate solutions across sectors. In the first half, the Company secured traction in two new verticals: smart vehicles and low altitude economy. Within manufacturing, it partnered with Getech to build China’s first Token Factory. In connected vehicles, deep partnerships have been established with PATEO and Saime. On computing infrastructure, the Company formed strategic alliances with three major Chinese GPU developers: MetaX, Iluvatar CoreX and Biren Technology.

International expansion has reached a critical milestone. In July, Xunce signed a memorandum of understanding with a European digital and AI service provider to jointly develop Token factories tailored for the European market. Europe is renowned for stringent data sovereignty and compliance regulations. TokenOS’s entry into the region serves as top-tier validation of product maturity and compliance frameworks, creating a replicable blueprint for scaled rollout across additional overseas markets.

A New Cycle of Exponential Growth has Commenced

First-half results validate the soundness of the Company’s strategic roadmap. Three successive growth stages ahead pave the way for an extended expansion cycle.

In the short term, accelerated TokenOS deployment unlocks large scale revenue expansion. Commercialization of TokenOS remains in the early phase. As more industry-specific Token Factories move from piloting to formal operation, and an increasing number of clients shift from subscription to Token-based payment models, Token-driven revenue is on track to rise from the current 10% to the targeted 20%-30% for the full year, supporting sustained and accelerating ARR growth.

Over the medium term, TokenRouters will reshape the growth model. The official launch of TokenRouters scheduled for the second half of the year will systematically break down barriers to Token circulation across enterprises, industries and scenarios. This creates a full value loop covering internal data governance, tokenization, compliant encapsulation, cross-domain circulation and value exchange.

Long term, enterprise-specific small models and the data ecosystem together unlock a trillion-dollar market opportunity. The ultimate form of enterprise AI adoption centers on every organization owning privately deployable, continuously evolving domain-specific small models. Xunce has taken an early lead by building a full-stack value chain spanning computing power, data, Tokens, models and applications, establishing substantial first-mover advantages. Among the three core pillars of AI, computing infrastructure and foundational models are already dominated by large tech players. The data layer, however, lacks systematic investment from major players – a strategic gap Xunce aims to fill. The Company bridges the “last mile” for AI adoption, turning large model technology into enterprise productivity.

Over the past decade, Xunce has deepened its footprint in financial services and cross-industry data governance via project-based and subscription models, proving the viability of its technology and business model. Looking ahead to the next decade, the Company’s strategic roadmap is clear. Xunce will build on the TokenONE operating system as its foundation, use TokenRouters to enable cross-enterprise value exchange, and leverage enterprise small models to bridge the last mile of AI implementation. A new cycle marked by the shift from linear to exponential growth has commenced.