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The average growth rate of China’s top 50 rapidly expanding tech companies over the past three years has declined this year compared to last year, according to a Deloitte China report.
This year’s average annual growth rate among these leading tech firms was 490%, down from 588% in the previous year.
Additionally, 19 of these companies reported revenues between 50 million and 100 million yuan (roughly $7.1 million to $14.2 million), up from 15 last year. Meanwhile, the number of companies with revenues exceeding 100 million yuan remained steady at 22, indicating a rise in small and medium-sized businesses and sustained stability among established firms. The revenue growth rate for the top 10 companies experienced only slight changes.
Nearly a quarter of these companies invest more than half of their revenue into artificial intelligence research and development. However, they all face challenges such as a shortage of high-tech talent, limited application of AI in real-world business scenarios, and rising R&D costs, according to Zhao Jindong, the national managing partner of Deloitte China’s Technology Fast program.
Over half of these firms—26 out of 50—are based in the Guangdong-Hong Kong-Macao Greater Bay Area. Major cities like Shanghai, Shenzhen, Beijing, and Guangzhou, with their mature industrial bases, abundant talent pools, and dense capital resources, continue to be the primary hubs for such companies.
The hardware industry led with 14 companies, followed by nine from the high-end equipment sector. The growth in semiconductors contributed to the hardware segment’s success, while the high-end equipment sector benefited from strong performance in intelligent manufacturing. Conversely, the number of firms in the software and life sciences industries declined year-over-year, and entries from the internet sector saw a significant drop.
The program supporting fast-growing tech companies was established in Silicon Valley in 1995 and expanded into China in 2005. Entrants this year were required to submit audit reports covering 2022 through 2023, with a minimum operating revenue of 2 million yuan (about $284,000) in 2022 and 30 million yuan by 2024, along with demonstrating a solid capacity for sustainable growth.
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