Breaking Down Qi An Xin Technology Group Inc. Financial Health: Key Insights for Investors

From its 2014 founding by Qi Xiangdong to its STAR Market debut in July 2020, Qi An Xin Technology Group (ticker 688561.SS) has rapidly positioned itself as a national cybersecurity pillar-backed strategically by China Electronics Corporation and boasting a market capitalization of about $3.74 billion (CN¥27.48 billion) as of November 7, 2025-while advancing a mission of data-driven, endogenous security that saw it serve as the official cybersecurity sponsor for the Beijing 2022 Winter Olympics with a "zero incident" record; the company, which lists a 52‑week share range of CN¥23.12-47.77, dedicates nearly a third of its workforce to R&D, launched the proprietary TianGou security engine in 2024, expanded internationally in 2025 into Southeast Asia, the Middle East and Africa, and today combines product sales, subscription services, consulting/intelligence and system integration to serve government and enterprise customers despite an 18.10% year‑over‑year revenue decline in the trailing twelve months ending September 30, 2025, making its strategy, ownership, technology stack and revenue mix essential reading for anyone tracking China's cybersecurity leaders.

Qi An Xin Technology Group Inc. (688561.SS): Intro

• Founded in 2014 by Qi Xiangdong, a veteran of Qihoo 360 and earlier co‑founder of 3721, leveraging decades of security and internet operations experience.
• 2019: Strategic separation from Qihoo 360; China Electronics Corporation (CEC) took a strategic stake, positioning Qi An Xin as a national-level cybersecurity player.
• July 2020: Listed on the Shanghai STAR Market (ticker 688561.SS), raising approximately RMB 2.62 billion in the IPO to accelerate R&D and product expansion.
• 2022: Appointed official cybersecurity services sponsor for the Beijing Winter Olympics and delivered a 'zero incident' operational record during the Games.
• 2024: Launched the TianGou security engine, a next‑generation threat detection and analytics core strengthening product capabilities across network, endpoint and cloud.
• 2025: Accelerated international expansion, providing cybersecurity services to Chinese multinational enterprises across Southeast Asia, the Middle East and Africa.

• Founding/management: Qi Xiangdong retains founder/CEO influence and board representation.
• State strategic investor: China Electronics Corporation (CEC) is a major strategic shareholder (institutional/strategic stake secured in 2019), aligning the company with national cybersecurity priorities.
• Public float: Listed shares on STAR Market trade under 688561.SS with a mix of institutional and retail shareholders post-IPO.

• Mission: Provide enterprise and government-grade cybersecurity products and services to defend complex digital environments-network security, endpoint protection, threat intelligence, cloud security and SOC services.
• Core product pillars: threat detection & response (including TianGou engine), network security appliances, managed security services, and security consulting/compliance for critical infrastructure.
• Target customers: government agencies, critical infrastructure, telecoms, finance, large enterprises and expanding support for Chinese firms overseas.

• Product + service stack: sells hardware/software licenses and subscription-based cloud/SOC services; integrates threat intelligence, sandboxing, behavioral analytics and AI-powered detection from TianGou.
• Delivery model:
  • On-prem appliances and software for high-security environments.
  • Cloud and hybrid deployments for enterprise customers.
  • Managed security operations (24/7 SOC) and incident response retainers.
• R&D emphasis: large internal security research teams, red-team/CTF activities, and ongoing machine learning model development to detect advanced persistent threats (APT).

• Product sales: one‑time hardware and perpetual license revenues for appliances and on-prem software.
• Recurring revenues: subscription licenses, cloud SOC, threat intelligence feeds and maintenance contracts (increasing share of total revenue over time).
• Services: professional services, consulting, compliance assessments, incident response and managed detection & response (MDR).
• Channel & enterprise direct: mix of direct enterprise sales and partner/channel distribution for mid-market and regional customers.

• IPO proceeds (July 2020): ~RMB 2.62 billion to fund R&D, go‑to‑market and capacity buildout.
• Olympics 2022: delivered zero cybersecurity incidents during the Beijing Winter Games engagement-high visibility national credential.
• TianGou launch 2024: introduced advanced detection and analytics engine, improving mean time to detect (MTTD) and false positive reduction for clients.
• International footprint 2025: active client projects and partnerships across Southeast Asia, Middle East and Africa supporting Chinese enterprises' overseas operations.

• R&D investment: sustained high R&D spend to maintain threat research, AI capabilities and product differentiation (majority of capex focused on software, cloud and security intelligence).
• M&A and partnerships: selective acquisitions and alliances to extend cloud SOC, OT/ICS security and regional service capabilities.
• Recurring revenue growth: focus on increasing subscription and managed services to improve predictability and gross margins.

Qi An Xin Technology Group Inc. (688561.SS): History

• Founded: focused on network security, threat detection and endpoint protection.
• 2019: CEC acquired a strategic stake, elevating Qi An Xin's role in national cybersecurity initiatives.
• Post-2019: accelerated product commercialization, cloud-security offerings, and industry partnerships.

• Listing: Shanghai Stock Exchange, ticker 688561.SS.
• Largest shareholder: China Electronics Corporation (CEC), strategic stake taken in 2019.
• Shareholder mix: institutional and individual investors; actively traded stock.
• Dividend policy: no declared dividends; earnings are reinvested for growth and R&D.

• Product suite: network security appliances, endpoint protection, threat intelligence, cloud-security platforms.
• Revenue streams: software licenses, hardware sales, managed security services, professional services, long-term government and enterprise contracts.
• Business model focus: recurring revenue via subscriptions and managed services, supplemented by one-time appliance and integration fees.

Qi An Xin Technology Group Inc. (688561.SS): Ownership Structure

• Mission: Provide comprehensive cybersecurity solutions that embed "endogenous security" and leverage data-driven intelligence to detect, prevent, and respond to threats across public- and private-sector environments.
• Core values: data-driven security, research-led innovation, collaborative defense, client confidentiality, and national service commitment.
• National role: contributed cyber-protection capabilities to the Beijing 2022 Winter Olympics, supporting secure operations and incident response during the Games.

• R&D focus: nearly one-third of the company's workforce is dedicated to research and development, reflecting a high emphasis on innovation and product evolution.
• Operations: operates a centralized Security Operations Center (SOC) providing real-time monitoring, threat hunting, and incident response (24/7 coverage).
• Ethics & compliance: maintains strict data confidentiality and integrity controls for clients and collaborates with national cybersecurity initiatives and standards bodies.

• How it makes money:
  • Product sales: licensing of security platforms (endpoint, network, cloud)
  • Subscription & SaaS: recurring revenue from managed detection & response, threat intelligence feeds, and cloud security services
  • Managed services: SOC operations, incident response retainers, and consulting engagements for government and enterprise clients
  • Professional services: deployment, customization, training, and long-term maintenance contracts

Qi An Xin Technology Group Inc. (688561.SS): Mission and Values

• Product and service portfolio: infrastructure security, next‑generation IT infrastructure protection, endpoint and cloud security, and big‑data driven security detection and management.
• Security Operations Center (SOC): continuous threat detection, large‑scale data acquisition, analysis, real‑time coordination and response capabilities to enable early threat awareness and incident mitigation.
• Proprietary engines and concepts: development of the TianGou security engine and promotion of an "endogenous security" approach that embeds security controls into IT system architectures rather than as bolt‑on solutions.
• Human + machine operations: SOC analysts, threat hunters and automated detection engines operate in tandem to create a collaborative defense model suited to the Internet of Everything (IoE) era.
• Go‑to‑market: a mixed direct‑sales and channel partner model serving public sector and enterprise clients across finance, telecommunications, energy, transportation and other critical sectors.

• TianGou security engine: a core detection and correlation engine that aggregates telemetry from endpoints, networks and cloud sources to perform behavioral analysis, anomaly detection and automated response orchestration.
• Endogenous security: integrates security models into system design - for example embedding runtime protection into middleware, databases and application platforms to reduce attack surface and speed response.
• SOC workflows: automated ingestion pipelines, threat intelligence fusion, playbook‑driven response and escalation to regional incident response teams; services offered 24/7 to priority customers.

• Revenue mix: product licenses (on‑prem and virtual), subscription services, managed detection and response (MDR), professional services (implementation, audits, threat hunting) and maintenance.
• Channels: nationwide reseller network, system integrators and direct enterprise/government sales teams for large contracts and strategic accounts.
• Customer base: emphasis on government agencies and regulated industries (banking, insurance, utilities, telecoms, energy, transportation), with reported thousands of enterprise customers and multiple government framework agreements.

• License sales and perpetual/subscription models for security appliances, virtual appliances and cloud instances.
• Recurring services: managed detection & response (MDR), SOC as a Service (SOCaaS), threat intelligence subscriptions and security monitoring.
• Professional services and long‑term maintenance contracts tied to large government and enterprise deployments.
• Cross‑sell and upsell: upgrading customers from basic perimeter controls to integrated endogenous security and advanced analytics modules.

• Competitive edge: strong domestic government and regulated industry customer relationships, localized threat intelligence, and vertically integrated product + SOC capabilities.
• Investment focus: sustained R&D spend to advance detection engines (TianGou), AI/ML models for behavioral analysis, and further integration of endogenous security into mainstream IT platforms.

Qi An Xin Technology Group Inc. (688561.SS): How It Works

Qi An Xin Technology Group Inc. (688561.SS) operates as a cybersecurity products-and-services company serving government, critical infrastructure and enterprise customers across China and select overseas markets. Its business blends product sales, recurring security subscriptions, professional services and system-integration/third-party hardware distribution.

• Core product portfolio: network security appliances, endpoint protection, cloud security gateways and next‑generation firewalls designed for infrastructure protection and industrial control systems.
• Recurring services: subscription-based managed detection & response (MDR), cloud-native security monitoring, threat intelligence feeds and regular signature/behavioral updates.
• Professional services: consulting, incident response, penetration testing, security architecture design and long‑term outsourcing contracts.
• Channel and integration: third‑party hardware sales, value‑added system integration and bundled deployment services sold through integrators and direct government procurement channels.

Revenue mix (typical composition):

• Hardware & appliance sales: ~45-60% of total revenue in many periods (driving short‑term cash).
• Software & subscription services: ~20-35% (growing share as the company shifts to recurring revenue).
• Professional services and system integration: ~10-20% (variable by contract cycle).

Key financial and operating dynamics

• Sales funnel: large, multi‑year government and enterprise procurement cycles with periodic lumpiness tied to budget cycles and national projects.
• Gross margin profile: product sales historically produce lower gross margins than pure software/subscription offerings; a higher mix of services/subscriptions supports margin expansion.
• Customer concentration: meaningful exposure to government and state-owned entities, with enterprise diversification increasing over time.
• Revenue volatility: subject to fluctuations from project timing, procurement approvals and competitive pricing; reflected in an 18.10% year‑over‑year decline in trailing twelve‑month revenue ending September 30, 2025.

Operational levers that generate cash and growth

• Cross‑sell and attach rate - selling subscriptions and threat intelligence on top of hardware deployments raises lifetime value.
• Longer subscription contracts - converting license sales to multi‑year SaaS/managed agreements increases ARR stability.
• Margin improvement - shifting revenue mix toward software and services improves gross and operating margins.
• Channel expansion - using system integrators and third‑party hardware resale to access smaller enterprises and municipal customers.

Representative performance snapshot (illustrative structure rather than audited figures):

Further reading: Exploring Qi An Xin Technology Group Inc. Investor Profile: Who's Buying and Why?

Qi An Xin Technology Group Inc. (688561.SS): How It Makes Money

• Core revenue streams: on-premises security products (appliances, endpoint protection), cloud-native security platforms, security operation center (SOC) services, managed security services (MSS), professional services (integration, training), and software-as-a-service (SaaS) subscriptions.
• Key customer segments: central and local government agencies, telecom operators, financial institutions, large enterprises, and overseas Chinese enterprises.
• Competitive advantages: strong government certifications, large installed base in China, partnerships with cloud providers, and specialized threat intelligence capabilities (including the TianGou security engine).

• Leading market share in several enterprise and government security segments in China, with strong brand recognition after serving as the official cybersecurity services sponsor for the Beijing 2022 Winter Olympics.
• High R&D intensity: R&D spend routinely near or above 18-20% of revenue supports product upgrades (cloud, IoT, 5G) and development of advanced engines such as TianGou for threat detection and response.
• Recurring revenue mix: growing share of subscription and cloud services improves revenue visibility and margins versus one‑time appliance sales.
• International expansion: targeted service offering for Chinese enterprises overseas in Southeast Asia, the Middle East and Africa increases TAM (total addressable market) beyond domestic demand.

• Hardware/appliance sales: generate upfront revenue and channel margins; install base drives recurring maintenance and upgrade contracts.
• SaaS/cloud security: higher gross margins and annuity-like subscriptions, increasingly important as clients migrate workloads to public/private clouds.
• MSS & SOC services: recurring managed-service contracts with multi-year terms; add predictable ARR (annual recurring revenue) and customer stickiness.
• Professional services & integration: one-off higher-margin projects that accelerate adoption of core platforms.
• Licensing & threat intelligence: monetization of proprietary engines (e.g., TianGou) through platform licensing and partner OEM agreements.

• Strong pipeline driven by cloud migration, 5G rollout and IoT proliferation-markets that increase demand for unified security platforms and managed services.
• Ongoing product innovation and R&D investments position the company to capture higher-value security projects and cross-sell cloud/SaaS offerings to an expanding client base.
• Strategic initiatives to grow overseas services and partnerships could lift international revenue share over the medium term.