CXMT Founder Gifts Employees $5.6 Billion After Record IPO
Xu Yiming, founder and chairman of Chinese memory chip manufacturer CXMT, has pledged to award his company’s employees stock bonuses worth approximately $5.6 billion, a rare move that reflects intensifying competition to attract talent in the semiconductor and artificial intelligence sectors.
The pledge follows the strong performance of CXMT’s shares on the Shanghai Stock Exchange, where the stock surged 466% in its first trading session, propelling Xu’s wealth up by roughly 30% to $13.9 billion, according to the Bloomberg Billionaires Index.
In the company’s prospectus released last May, Xu revealed his plan to convert 767.9 million shares into employee incentive programs. Following the sharp rise in the stock price, the value of this stake reached approximately $5.6 billion, equivalent to nearly 40% of his current net worth.
Xu reinforced his commitment to the company by agreeing to restrictions that prevent him from selling his shares for 10 years, an unusual measure among companies listed on Chinese exchanges.
Despite the size of the announced bonus, employees will not receive their shares immediately. The prospectus stated that distribution will begin after three years, with shares vesting gradually over a full decade. The company did not specify the number of employees eligible for the program, noting that it employed 19,298 staff members by the end of 2025.
Xu’s significance stems from his role as one of the Chinese billionaires linked to the country’s efforts to strengthen technological supply chain security. In 2018, he stepped down from his previous successful company, GigaDevice Semiconductor, to lead the CXMT project in partnership with the Hefei municipal government, pledging at the time to forgo any salary until the project became profitable.
Those bets have proven successful: CXMT is now China’s largest company and the world’s fourth-largest producer of DRAM chips, the core components used in data centers, AI servers, and advanced computing applications.
The incentive program also reflects the company’s ownership structure. Prior to the listing, the Hefei municipal government held more than 30% of CXMT’s shares, both directly and indirectly, while China’s Semiconductor Industry Investment Fund (Big Fund II) held a stake exceeding 8%, highlighting the significant role of government support in nurturing this strategic chip industry.
