US Stock IPO Preview | With Steady Revenue Growth, Can Leapmotor Achieve a Technological Breakthrough Through Its IPO?

In the first half of 2025, while the Hong Kong stock market IPOs were active, Chinese concept companies showed a trend of active performance in the U.S. market. According to statistics, a total of 45 companies successfully listed in the U.S., accounting for 22% of the U.S. IPO market, significantly exceeding the 30 companies from the same period last year. Among them, 40 companies went public through IPOs, 4 through De-SPAC, and 1 through OTC transfer. Excluding the 4 De-SPAC and 1 OTC transfer, Chinese concept companies raised approximately $870 million in the U.S. stock market in the first half of 2025, with total fundraising showing a counter-trend growth. This indicates that the U.S. stock market still has attention and investment interest in Chinese companies.

Recently, another Chinese concept company submitted a prospectus, preparing to enter the U.S. stock market.

According to the Zhitong Finance APP, Chinese cloud network software company Zerolimit Technology Holding has submitted its initial public offering (IPO) application to the U.S. Securities and Exchange Commission (SEC), with the stock code "ZDAN." The company plans to issue 2 million shares at a price of $4 per share, raising $8 million. Based on the proposed price, Zerolimit Technology's market value will reach $208 million.

Steady Performance

According to the prospectus, Zerolimit Technology was established in Shenzhen in 2017 and is a distributed application service provider in the digital economy. The company is committed to providing comprehensive solutions for global users in the transition to the new generation of the internet, offering digital solutions for government enterprises and various industries and fields. Its distributed network infrastructure software products enable users to efficiently build distributed networks or migrate existing centralized applications to distributed networks. Application areas include digital government, distributed online education, distributed search engines, distributed e-commerce, digital asset platforms, food traceability, the Internet of Things, and intelligent manufacturing.

The company primarily generates revenue from software product sales through distributors and related post-service contracts. As of the fiscal years 2024 and 2023, the company had 35 and 28 distributors in China, respectively. Currently, sales have expanded to 9 provinces and 11 cities in China.

In terms of revenue performance, the company has shown stable growth over the past two years. For the fiscal year ending September 30, 2023, and the fiscal year 2024, the company achieved revenues of $4.187 million and $4.381 million, respectively, a year-on-year increase of 5%; net profits were $2.523 million and $2.711 million, respectively, a year-on-year increase of 7%, with both core financial indicators showing steady growth.

By product, the cloud data base station node software is the company's main source of revenue. It is reported to be a foundational toolkit for building distributed networks, capable of transforming devices into network nodes. As a core module, it can operate specific tasks independently or integrate with other software. Each node acts as a microserver providing storage and computing capabilities, supporting users in the development of distributed networks. During the reporting period, revenue from this business continued to grow, achieving revenues of $4.903 million and $5.312 million, accounting for 86.3% and 89.9% of total revenue, respectively At the same time, the enterprise database station node software and hardware sector also brought in $123,000 in revenue for the company in fiscal year 2025 due to the launch of new products during the period.

However, sales of smart metaverse boxes and decentralized application software recorded a decline during the reporting period. Specifically, revenue from the smart metaverse box business fell from $143,000 in fiscal year 2024 to $37,000 in fiscal year 2024, with its revenue share dropping from 2.52% to just 0.6%; revenue from the decentralized application software business decreased from $635,000 in fiscal year 2024 to $434,000 in fiscal year 2024, with its revenue share falling from 11.18% to 7.4%.

Policy Promotion, Positive Industry Development

The steady upward performance is inseparable from the positive development of the industry outlook.

As a backbone force leading the implementation of the national innovation strategy, the digital economy has attracted significant market attention in recent years. Data, as a production factor, can generate and promote the development of new industries, new business formats, and new models in the digital economy, serving as an important lever for promoting high-quality development of the digital economy. Digital transformation has also become an essential path for high-quality urban development.

As a new model and concept for the operation and governance of modern cities, the concept of "smart cities" was proposed in 2008. Pilot projects for smart cities gradually began in 2012. In February 2023, the country proposed a top-level plan for building a digital China and promoting intelligent development strategies, clarifying that building a digital China is an important engine for advancing Chinese-style modernization in the digital age and a strong support for establishing new national competitive advantages.

With the widespread application of new-generation information technologies such as big data, artificial intelligence, the Internet of Things, and cloud computing, the pace of smart city construction in China is accelerating. According to a report by the China Business Industry Research Institute, the market size of China's smart cities, in terms of investment value, is expected to grow from 15 trillion yuan in 2020 to 36.8 trillion yuan in 2024, with a compound annual growth rate of 25.2%. Analysts from the China Business Industry Research Institute predict that the market size of China's smart cities will reach 45.3 trillion yuan by 2025.

Against this backdrop, there is enormous market potential for "one city, one cloud." Huawei is accelerating its layout in the central cloud market, while Lingji Digital, as a distributed cloud enterprise, is also actively positioning itself.

According to the Zhitong Finance APP, from a global perspective, the market size of decentralized distributed technology is expected to maintain rapid growth. According to data and forecasts released by the market research firm International Data Corporation, the global market size for decentralized distributed technology reached $1.4 billion in 2020. It is expected to reach $18.95 billion by 2024, achieving an approximate compound annual growth rate of 48% during the forecast period and maintaining a rapid growth trend  

Due to the increasing demand for decentralized and secure data storage, computing, and communication solutions, China's decentralized distributed technology market is still in its early stages, but the market size is expected to grow rapidly. According to data and forecasts released by the International Data Corporation, the market size of decentralized distributed technology in China reached USD 600 million in 2021. It is expected that China's distributed technology market will grow in the coming years, particularly focusing on areas such as intellectual property, healthcare, e-commerce, education, and financial services, which require secure and decentralized systems capable of handling sensitive data, transactions, and supply chain logistics. By 2026, the decentralized distributed technology market in China is expected to reach USD 4.28 billion, achieving an approximate compound annual growth rate of 32% during the forecast period, indicating rapid growth.

However, it is important to note that there are currently no widely recognized leading developers or companies in the Chinese market, with Lingji Digital as an early industry participant having a first-mover advantage.

Overall, as an early participant in the distributed technology field, Lingji Digital demonstrates certain market potential against the backdrop of rapid industry growth. Its core product, the cloud data base station node software, shows stable revenue performance, and the company's layout in smart cities and digital transformation provides a foundation for its future development. However, the distributed technology market is still in its early stages, and the competitive landscape has yet to take shape. Whether Lingji Digital can continue to seize opportunities and meet challenges remains to be further observed