On November 4, 2026, the China Securities Regulatory Commission (CSRC) added Jiangsu Vertilite Semiconductor Technology Co., Ltd. to its filing list for IPO coaching, with Guotai Haitong Securities serving as the sponsor.
| Walking on Two Legs: From Consumer Electronics to Automotive Standards
Vertilite was founded in 2015 by a team of PhDs from Stanford University, based in Wujin, Changzhou, focusing primarily on VCSEL chips.
The term "VCSEL" may be unfamiliar to the general public, but its application scenarios are close at hand: facial recognition in smartphones, obstacle avoidance in robot vacuums, and automotive LiDAR all rely on it as a core light source.
Vertilite established its foothold in the industry through accumulation in two key areas.
In consumer electronics, the company achieved mass production and supply of VCSEL chips for smartphones relatively early, becoming one of the few suppliers in mainland China with this capability at the time.
In automotive standards, Vertilite became the world's first VCSEL manufacturer to pass automotive-grade certification in 2020. The requirements for VCSELs in automotive LiDAR are significantly higher than for consumer-grade products; stability under extreme temperatures, beam quality, and zero-defect delivery are each high barriers to entry. Vertilite's automotive-grade chips have been integrated into mainstream LiDAR manufacturers such as RoboSense and Hesai Technology, with annual vehicle installations exceeding one million units.
The combination of these two lines has given Vertilite a relatively solid foundation in the niche VCSEL market. According to information from the official website of the People's Government of Wujin District, Changzhou City, in September 2026, the cumulative shipment volume of the company's VCSEL chips has exceeded 900 million units. In the chip industry, shipping scale combined with a zero-defect record is more convincing than any promotional rhetoric.
| Revenue Rising, Losses Persisting
According to data disclosed in Dongyangguang's external investment announcement in June 2025, Vertilite's full-year revenue in 2024 was approximately CNY 125 million, with a net loss of about CNY 58.3 million; in Q1 2025, revenue was CNY 41.23 million, with a net loss of CNY 15.32 million. The magnitude of losses is narrowing, but profitability has not yet been achieved.
Optical chips are a typical capital-intensive, long-cycle industry, requiring substantial real money investments in 6-inch gallium arsenide epitaxial production lines, MOCVD equipment, and packaging and testing platforms. Vertilite completed and put into operation its FabX project with a total investment of CNY 550 million in September 2025, and signed a contract in August 2026 for a high-end optical communication chip base with a total investment of approximately CNY 5 billion, focusing heavily on indium phosphide laser chips. Expanding capacity while running at a loss is common in the semiconductor industry; the key question is whether the expanded capacity can be absorbed by the market.
| Structural Shift in the VCSEL Market
Understanding Vertilite's story within the broader trends of the VCSEL industry provides clearer insight.
The industry is undergoing a migration in demand structure. Consumer electronics (3D sensing, Face ID) remain the largest application segment for VCSELs, but growth has slowed. The true incremental growth comes from two directions: optical communications and automotive electronics. On the automotive line, Vertilite has secured its position. The logic behind the shift of LiDAR light sources from edge-emitting lasers (EEL) to VCSELs is clear: VCSELs naturally suit two-dimensional arrays and wafer-level manufacturing, and their automotive reliability surpasses that of EELs, making them nearly the only mature laser light source solution for all-solid-state architectures. However, competition is intensifying. Everbright Photonics has entered the automotive VCSEL market with an IDM model, while Ruisi Technology is advancing mass production of two-dimensionally addressable VCSELs, focusing on chip-level beam control for all-solid-state LiDAR. Vertilite's first-mover advantage lies in the time window for automotive certification and mass production experience accumulated during the consumer electronics era, but this window will not remain open indefinitely.
What truly determines the future valuation elasticity of Vertilite is the indium phosphide line.
| Indium Phosphide: A Bet on Breaking Bottlenecks
The core of the CNY 5 billion high-end optical communication chip base signed by Vertilite in August 2026 is indium phosphide laser chips. The industrial background of this choice is worth exploring.
The upgrade of optical modules driven by AI computing power is pushing indium phosphide from the bottom of the supply chain to the forefront. A report released by Goldman Sachs in September 2026 predicts that shipments of 800G and above optical modules will reach 78.22 million units in 2026, a year-on-year increase of 166%; shipments of 1.6T optical modules are expected to grow from approximately 32.8 million units in 2026 to approximately 71.4 million units in 2027. With each generation increase in speed, the consumption of indium phosphide substrates does not grow proportionally but accelerates—substrate consumption for 1.6T is 2.7 to 3 times that of 800G.
The supply gap is more noteworthy than the demand growth rate. Data shows that global demand for indium phosphide substrates reached 2.6 to 3 million pieces in 2026, while effective capacity was only about 750,000 pieces, resulting in a gap of over 70%. The domestic self-supply ratio for indium phosphide substrates is less than 5%, indicating extremely high external dependency. Under this supply-demand landscape, Vertilite's bet on indium phosphide is easy to understand: it already possesses mass production capabilities on both gallium arsenide and indium phosphide platforms, making it one of the few domestic optical chip companies operating under an IDM model. If the indium phosphide production line successfully ramps up and passes certification by top-tier customers, its narrative will no longer just be "domestic VCSEL supplier," but rather entering the most scarce link in the domestic substitution of core optical communication chips. However, risks are equally clear: yield ramp-up of the indium phosphide production line, customer certification cycles, and potential supply-demand turning points around 2027 are all variables.
| Industrial Signals in the Shareholder List
A review of Vertilite's shareholder list reveals a clear clue: industrial capital appeared earlier and more densely than financial capital. Huawei Hubble and Xiaomi joined in the Series C round at the end of 2020, followed by BYD, Hesai Technology, and RoboSense in subsequent rounds. According to a report by Shanghai Securities News in August 2026, BYD holds a 1.09% stake, Hesai holds 0.95%, and RoboSense holds 0.95%. Dongyangguang invested CNY 90 million in 2025, acquiring an approximate 2.575% stake. Hesai and RoboSense are themselves LiDAR manufacturers, and BYD is an automaker; their investments carry clear implications of supply chain synergy. Dongyangguang's involvement leans towards considerations of upstream materials and data center layout.
| Filing for Coaching Is Just the Beginning
How will the secondary market price a company that has successfully navigated both consumer electronics and automotive standard lines in the VCSEL field and placed a heavy bet on indium phosphide optical communication chips? The VCSEL track itself is shifting, the supply-demand gap for indium phosphide is widening, and policy windows and industrial demands for domestic substitution are present, but the competitive landscape is far from settled. The answer will not emerge quickly, but the filing itself indicates that Vertilite believes it is ready.
Disclaimer: This article is written based on publicly available materials and does not constitute investment advice. Data cited herein is subject to relevant company announcements, government websites, and authoritative media reports; official disclosures shall prevail in case of discrepancies. There is uncertainty in the IPO process, and readers should make independent judgments.