Business
Xiangdixian Collapses Amid Cash Crisis and Legal Troubles: A Setback for China’s Chip Self-Sufficiency Pursuit
Xiangdixian, a Chinese chip company, reportedly goes under due to financial strains and legal issues. The Chongqing-based firm has reportedly dissolved and ended the contracts of approximately 400 staff members, as per reports from Chinese media.
The Chinese semiconductor company, Xiangdixian Computing Technology, has allegedly been forced to shut down and let go of all its staff due to a severe cash flow problem. This incident underscores the challenges encountered by local chip manufacturers, even as the country strives for nationwide technological independence.
On Friday, Xiangdixian, a company located in the southwestern city of Chongqing, conducted a company-wide meeting where they declared the business's closure. The company's decision resulted in almost 400 employees losing their jobs, as per local news outlets like ijiwei and TMTPost.
The firm was unable to meet the conditions stipulated in a prior investment round, causing its stockholders to initiate a legal case. This resulted in the suspension of its bank account, as disclosed by TMTPost. Xiangdixian is currently in pursuit of fresh investors and attempting to regain control of its account, according to the same source.
In a message shared on WeChat on Sunday night, Xiangdixian refuted claims that it has initiated steps to dissolve or wind up the business. The company admitted to grappling with "market realignment pressures", given that the progress of domestic GPUs has fallen short of its projections.
Currently, the company has announced it is "making changes" to cut operational expenses that impact certain team members, but will bolster its essential research and development and operation teams. The company also stated it is presently engaging in active discussions with investors and seeking options for external funding.
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