Track Hyper | Honor Launches IPO: An Enlightenment on AI Ecosystem Transformation

Author: Zhou Yuan / Wall Street News

On June 26, the official website of the China Securities Regulatory Commission disclosed that Honor has obtained the listing guidance filing from the Shenzhen Securities Regulatory Bureau, marking the official launch of Honor's A-share listing process.

From both industrial and commercial perspectives, Honor's IPO journey is not only a capital advancement for a consumer electronics company but also represents a collective exploration of traditional terminal manufacturers transitioning into AI ecosystem companies.

From Equity Restructuring to Ecological Foundation Building

The preparation for Honor's listing is essentially an orderly evolution of the "capital ecologicalization" process.

In December 2024, Honor completed its shareholding system reform. From then on, "Honor Terminal Co., Ltd." was changed to "Honor Terminal Joint Stock Company."

Behind this seemingly simple name change is a fundamental reshaping of the corporate governance structure. The organizational form of a joint-stock company has created conditions for Honor to introduce diverse capital, and the resulting lineup of over 20 shareholders is a classic case of industrial capital collaboration.

Shenzhen Zhixin, as the initiating shareholder, laid the foundation of state-owned capital, Guoxin Capital represents the strategic layout of local industrial funds, and the entry of China Mobile and China Telecom has opened up the channels and data resources of telecommunications operators, while the participation of industrial chain companies like BOE has further strengthened supply chain collaboration.

This design of equity structure aligns with Kevin Kelly's theory of "ecosystem value = number of connection nodes × connection strength" proposed in "The Technium."

The core logic of this formula is that the value of an ecosystem depends not only on the number of participating entities but also on the quality and depth of interactions among these entities.

Through capital ties, Honor has woven the originally dispersed industrial forces into a mutually empowering network, thus possessing extremely high depth quality—the system's capability often surpasses that of individual organizations, laying the groundwork for the open sharing of AI ecosystems.

It is noteworthy that Honor has maintained strategic initiative throughout the process of equity diversification.

Unlike some companies that dilute control for financing, the shareholders introduced by Honor all have strategic alignment with the AI terminal ecosystem.

For example, China Mobile's accumulation in the fields of 5G networks and cloud computing can form a "cloud-edge-end" synergy with Honor's terminal AI; BOE's flexible screen technology directly supports hardware innovations for Honor's flagship foldable devices like the Magic V5 (scheduled for release on July 2).

This "strategic investor priority" equity strategy ensures that capital injection always serves Honor's goal of transforming into an AI terminal ecosystem.

Wall Street News notes that the timing of Honor's listing guidance filing resonates cleverly with the rollout rhythm of Honor's Alpha strategy.

This strategy, released by Honor CEO Li Jian at this year's MWC in Barcelona in March, is not merely a technical roadmap but a reconstruction of the logic of the consumer electronics industry: as Apple co-founder Steve Jobs said, "Innovation is not about improving existing things, but about redefining their essence." The "three-step" path of the Alpha strategy corresponds to three stages of the integration of AI and terminals.

The era of AI agents focuses on the reconstruction of mobile phone forms, upgrading terminals from "tools" to "comprehensive intelligent partners" through features like a full-stack personal knowledge base; general AI technology breaks the limitations of single devices, injecting AI capabilities into new terminals such as robots (which Honor has already ventured into), forming cross-scenario collaboration; AGI (Generative AI) explores the extension of human capabilities through technology, implementing technological empowerment to realize the value of "humans."

To support this strategy, Honor plans to invest over $10 billion in R&D funding over the next five years.

The allocation logic of this investment is quite meaningful: it is not concentrated on a single product but is dispersed across areas such as foundational algorithms, cross-terminal protocols, and open ecological platforms.

For example, Honor's developed multi-agent collaborative system can enable devices like smartphones, computers, and robots to form "collective intelligence."

This technological breakthrough directly addresses the core pain points of the consumer electronics industry—historically, collaboration between different devices has remained at a superficial level, such as file transfer, while the involvement of AGI is upgrading it to "cognitive collaboration."

During the June MWC Shanghai, Honor's strategic cooperation with China Mobile on AI terminals revealed the open logic of its ecological construction.

This cooperation shows that both parties are not merely promoting simple technological integration but are co-building a data training system: China Mobile provides anonymized user behavior data (such as communication records and service usage habits), while Honor contributes terminal-side AI algorithms (such as multimodal interaction and large models on the device).

This model not only avoids data security risks but also achieves technological complementarity. Richard Stallman, the founder of the free software movement and advocate of the open-source movement, argued that "true innovation comes from sharing rather than closure," and Honor's AI ecosystem is practicing this concept.

Building Adaptive Systems for AI Transformation

To support the implementation of the "Alpha Strategy," Honor has promoted organizational renewal.

The famous American business historian and founding figure in strategic management, Alfred D. Chandler Jr. (1918.9.18-2007.5.9), mentioned a classic saying in management studies in his 1962 book "Strategy and Structure: Chapters in the History of the American Industrial Enterprise": structure follows strategy.

This statement itself is an outstanding classic assertion in strategic management: the core logic is that adjustments in corporate strategy will directly trigger adaptive changes in organizational structure, and the optimization of structure, in turn, supports the comprehensive implementation of strategy.

Honor's establishment of first-level departments such as the AI and Software Business Department is a practice of this principle: upgrading AI from a subsidiary function of the product department to the strategic core of the entire company The significance of the "Eagle Plan" goes far beyond talent selection: the open competition for 38 key positions, especially with 24% of participants being post-90s, breaks down the hierarchical barriers of traditional tech companies and forms an "ability-first" organizational culture.

This youthful team structure is crucial for AI research and development, as post-90s individuals, being digital natives, have a natural understanding of intelligent interactions that closely aligns with user needs.

More importantly, while launching the "Global Million Eagles Plan," Honor is building a four-tier talent matrix, creating a sustainable talent supply chain: "Qingying" level leading talents grasp the technological direction, "Zhanying" level backbones promote project implementation, the "Chuying" plan reserves future strength, and "Yaoying" user experience officers ensure that technology does not deviate from market demands.

Li Jian advocates the concept of "truth is power" on a cultural level, which seems simple but carries deep meaning.

When the executive team engages directly with users on social platforms, they are essentially constructing a feedback loop between the "organization and users": this is akin to the "Genchi Genbutsu" principle in the Toyota Production System (TPS), which is a cornerstone of Toyota management, discovering problems through direct contact with the end user.

In AI research and development, this culture is reflected in the deep involvement of user experience officers in algorithm training: for example, the AI photography algorithm of Honor's 400 series was developed by collecting shooting preference data from tens of thousands of experience officers, achieving a natural effect of "writing human portraits."

From Honor's recent business actions, the effectiveness of organizational change has begun to show: the newly established new industry incubation department has completed the preliminary layout of the robotics business in just six months.

This agility confirms the viewpoint of Nobel laureate Ronald H. Coase (1910.12.29-2013.9.2): the boundaries of a firm depend on the comparison of internal coordination costs and external transaction costs (this is the cornerstone of new institutional economics). Honor has reduced the internal coordination costs of AI innovation through organizational restructuring, enabling it to quickly enter emerging fields such as robotics.

Market performance is the best test of strategic effectiveness.

In the first half of 2025, Honor's product report shows that the transformation of the AI terminal ecosystem has translated into actual competitiveness.

The Honor 400 series leads in the 2.5K-4K price range not merely by relying on hardware parameters, but through its AI algorithms' precise capture of user needs: the 200 million ultra-clear human portrait function essentially understands the essence of "beauty" through AI, rather than simply enhancing pixels.

The upcoming launch of Honor's new flagship foldable phone, Magic V5, on July 2, carries the important mission of validating the AI terminal ecosystem.

Behind the "full brand terminal interconnection" feature is Honor's self-developed distributed AI protocol, which enables computing power scheduling and data sharing between different devices This technological breakthrough responds to Kevin Kelly's prediction in "The Inevitable": future technology will be fluid, seamlessly migrating between different carriers.

As smartphones, computers, and tablets form a "super terminal" through AI technology, the competitive dimension of consumer electronics has shifted from individual products to system capabilities.

Market Validation: Accumulating Ecological Potential

The growth data from the global market is also worth noting.

The Middle East and Africa market has quadrupled in growth over two years, reflecting the cross-cultural adaptability of Honor's AI capabilities: AI translation not only supports over 60 languages but can also recognize local dialects, and this localization ability allows it to break through rapidly in emerging markets.

Jack Trout, the creator of the theory of business positioning, once said, "The essence of globalization is the ability to localize." Honor's AI technology is building differentiated advantages in different markets through localized training.

Wall Street Insights has noted that the core logic of Honor's product layout has shifted from "price coverage" to "scenario coverage."

Honor Power focuses on battery life scenarios, GT Pro targets gaming scenarios, and the Honor 400 series is positioned as a "light flagship." Different products collaborate through a unified AI hub to form scenario-based solutions.

This strategy breaks the traditional parameter competition in consumer electronics and reconstructs product value centered around user scenarios: this is precisely the implementation of the Alpha strategy's concept of "returning to real needs."

Honor's attempt to go public is, in fact, challenging the capital market's understanding of the ecological value of AI terminals. If successful in listing, its significance will transcend the capital advancement of a single company, establishing a new valuation coordinate system for the technology sector.

"Warren Buffett," the "Oracle of Omaha," believes that the essence of investment is the judgment of future cash flows (i.e., Discounted Cash Flow), and Honor's value lies in its reconstruction of the cash flow generation method for consumer electronics companies.

The valuation of traditional terminal manufacturers relies on the "sales volume × profit per unit" model, while Honor's AI ecosystem is creating new revenue sources: for example, by opening AI capabilities to ecological partners, it can obtain technology licensing revenue; new businesses such as robotics open up a second growth curve.

This "hardware + software + services" model is similar to Apple's ecological profit logic but emphasizes the core driving role of AI more.

For the industry, Honor's IPO attempt provides three insights: first, the transformation of consumer electronics companies must be centered around AI, rather than as an added feature; second, ecological openness is more conducive to long-term development than technological closure; third, organizational change must be synchronized with strategic transformation.

These insights are reshaping the competitive and cooperative relationships in the industry: when Honor collaborates with shareholders such as BOE Technology Group and China Mobile, the innovation efficiency of the entire industry chain will be enhanced.

From the filing announcement by the Shenzhen Securities Regulatory Bureau to the gradual implementation of the Alpha strategy, every move by Honor reflects the transformation path and innovative aspirations of the consumer electronics industry The value of Honor's IPO lies not in whether it can truly become the "first stock of the AI terminal ecosystem," but in its exploration of a replicable transformation path: empowering technology through capital, supporting strategy through organization, and reconstructing value through ecology.

The upcoming Magic V5 foldable screen is likely the best window to observe this transformation.

When this product showcases features such as multi-agent collaboration, what people see is not just an innovation in mobile phones, but a future vision of an industry.

NVIDIA CEO Jensen Huang once said that AI is rebooting the world. In an era where AI reshapes everything, Honor's IPO journey is expected to become a classic case of how technology companies find certain anchor points amid transformation