Chinese state enterprises are replacing foreign databases, operating systems and applications against fixed dates. The demand is real and the domestic products are improving, but a services firm that lets the date stand in for a test serves neither its client nor the products it installs.
47 per cent Japan, 41 per cent China, 12 per cent Europe
Colleagues in six delivery locations
11,800
Dalian, Shenyang, Chengdu, Ho Chi Minh City, Japan and Munich
Japan gross margin, 2025
28%
Up from 23 per cent in the second half of 2022, after the currency clause
A Dalian IT services company keeps its clients by carrying a written share of their risk: in currency, in data and in what migrated software can actually do.
I am chief executive of Yanxiao Information Technology Company Limited, a fictional software services company headquartered in Dalian whose H shares have traded on the Hong Kong Stock Exchange's Main Board since November 2025. We earned revenue of RMB 4.36 billion in 2025: 47 per cent from Japanese clients, 41 per cent from Chinese enterprises and 12 per cent from European manufacturers. Our 11,800 colleagues work in Dalian, Shenyang, Chengdu, Ho Chi Minh City, three Japanese cities and Munich, writing, testing and maintaining software that other companies run their business on.
I have spent my whole working life on the seam between Chinese engineers and the people who buy their work. I joined Yanxiao as a programmer in 1997, when it had 140 staff and one kind of customer, and spent six and a half years in Tokyo carrying requirements between Japanese project managers and Dalian teams. I later ran a Japanese integrator's captive centre in Dalian, which showed me how our clients decide what to send offshore, before returning to build our business with Chinese state and private enterprises. The board made me chief executive in April 2019.
The years since have tested the business model I grew up in. The yen lost about a fifth of its value against the renminbi between early 2021 and the end of 2023. Chinese state enterprises began replacing foreign databases and operating systems to fixed dates. Japanese and European clients started sending questionnaires about Chinese law and export controls that ran to hundreds of questions. My response each time has been to name the risk, agree on paper who carries which part of it, and accept losing the clients or contracts that preferred not to look.
A currency clause instead of a quiet pay freeze
Fourteen of our eighteen largest Japanese clients accepted a symmetric clause that shares yen movements beyond 5 per cent. Two clients worth RMB 146 million a year left. Japan gross margin recovered from 23 per cent in the second half of 2022 to 28 per cent in 2025.
Billing moved to a domestic database after parallel running
At a provincial port group we refused to accept a billing cut-over before three months of parallel running, and lost RMB 112 million of related work to a competitor that promised the date. The billing system moved in September 2024 and its first month produced no disputed invoices.
Controlled work moved out of China at a client's request
When a German drivetrain client concluded that part of its engineering scope could not be accessed from China, we moved about 150 roles to Ho Chi Minh City and Munich within nine months. The client stayed, and its revenue with us reached RMB 181 million in 2025.
A listing on the research ratio we actually had
We declined to reclassify billable delivery hours as research in order to fit the STAR Market, and listed in Hong Kong in November 2025 instead, raising HK$1.08 billion at about sixteen times 2024 earnings.
Current focus
I am preparing the board's decision on acquiring a 310-person systems integrator in Fukuoka, a ¥5.2 billion question about whether owning client relationships in Japan is worth the integration risk for a company that has only ever been a supplier there. Alongside it, I am moving the rest of our Japanese work from person-month rates to priced outputs, because AI-assisted coding is changing the hours faster than our contracts are.
Conversations I welcome
I am not looking to leave Yanxiao. I would consider one independent non-executive directorship at a listed manufacturer or logistics company, in Hong Kong or on a mainland exchange, that is building operations in Japan, Southeast Asia or Europe and has no business with Yanxiao. Twenty-five days a year is what I can offer, and only with the Yanxiao board's agreement. I also accept a few invitations to speak to exporters and company directors.
Beyond the page
The record behind the perspective.
In the boardroom
Yanxiao Information Technology Company LimitedExecutive director and chief executive · 2019–present
Yanxiao Japan K.K.Director of the wholly owned Japanese subsidiary, in an executive capacity · 2019–present
Yanxiao Vietnam Company LimitedChair of the wholly owned Vietnamese subsidiary, in an executive capacity · 2023–present
Formation
Bachelor of Engineering in Computer ScienceHaocheng Institute of Technology · 1997
Executive MBA, part-timeQiyun School of Management · 2014
Cheng brought the committee the file-handling lapse within a week, with what was known and what was not marked separately. He had done the same with the Kurobane rate benchmark before any of us thought to ask for it. In a founder-led company that habit is worth more than any presentation.
Tsang Wing-yeeFictional independent non-executive director and audit committee chair, Yanxiao Information Technology Company LimitedThe full record ↗
Contact
I am not looking to leave Yanxiao. I would consider one independent non-executive directorship at a listed manufacturer or logistics company, in Hong Kong or on a mainland exchange, that is building operations in Japan, Southeast Asia or Europe and has no business with Yanxiao. Twenty-five days a year is what I can offer, and only with the Yanxiao board's agreement. I also accept a few invitations to speak to exporters and company directors.