创业最前线

wrote a column ·

Veteran IT firm dons an 'AI makeover,' but Legend Holdings still earns most of its money from financial services, as its controlling shareholder faces a divorce scandal

Produced by | Frontline of Entrepreneurship

Author | Feng Yu

Editor | Egg Chief

Art Editor | Xing Jing

Reviewed | Songwen

When a veteran IT company with annual revenue of RMB 21 billion suddenly starts telling a new story about 'supply chain AI,' the capital market’s first reaction is often excitement—after all, in today’s environment where 'AI+' has become a national strategy, few companies can simultaneously claim both AI and supply chain as core strengths.

Legend Holdings is precisely such a case. In the first half of 2026, the company made a series of bold moves: launching the 'xᴬᴵ·Supply Chain' ecosystem co-creation initiative, winning a RMB 7.11 billion logistics procurement contract from China Mobile, and unveiling the 'Yanyun Trio' technology platform... Legend Holdings is striving to position itself as a 'leader in AI-powered solutions centered on supply chains.'

However, a closer look at Legend Holdings’ 2025 annual report reveals another set of figures that temper enthusiasm: of its total revenue of RMB 21.015 billion, financial technology services accounted for as much as 64.2%, essentially supporting banks and other financial institutions in their digital transformation; integrated supply chain services generated only RMB 1.932 billion, less than 10% of total revenue; and the company’s overall gross margin declined from 13.76% the previous year to 11.83%, hitting a multi-year low.

In other words, Legend Holdings’ core earnings still come from its traditional financial technology business, while the narrative being promoted centers on AI and supply chain solutions.

This misalignment between its business narrative and underlying financial performance is precisely key to understanding Legend Holdings’ current situation:A veteran company with over two decades of history and multiple transformations is attempting, amid the AI wave, to leap from a traditional IT services provider to an integrated AI-driven supply chain solutions provider—does this represent the culmination of long-term accumulation, or is it, to some extent, wishful thinking?

1. A veteran IT company dons a new 'AI cloak'

To understand Legend Holdings’ AI narrative, one must first grasp the true nature of its revenue base and also revisit the company’s history of frequent strategic pivots.

Legend Holdings was spun off from Lenovo Group in 2000 and listed on the Hong Kong Stock Exchange in 2001. It subsequently spun off and incubated two A-share listed platforms—in 2013 and 2016, respectively: Digital China Information Service Company (DCITS) is a non-wholly-owned subsidiary, while Digital China Holdings was fully divested after its spin-off and no longer has a controlling relationship with Legend Holdings. All three listed companies are ultimately controlled by Guo Wei and collectively known as the 'Legend Group.'

Over the past two decades, Legend Holdings has undergone multiple strategic shifts—from IT services to smart city initiatives, and ultimately focusing on big data and artificial intelligence.

Each transformation came with growing pains, yet also accumulated valuable client resources across sectors such as finance and supply chain.

But the critical issue is this: while its strategic direction keeps shifting toward ever more cutting-edge areas, the fundamental composition of its revenue has never truly changed.

For the full year of 2025, Legend Holdings reported revenue of RMB 21.01 billion, an increase of 26.16% year-over-year. However, a closer look reveals starkly divergent growth trajectories across its three core business segments.

(Image / SheTu.com, based on VRF (AI-generated content))

Of this, financial technology services and others contributed RMB 13.495 billion, accounting for 64.21% of total revenue and growing by 32% year-over-year—this is the company’s core foundation. Data intelligence services generated RMB 5.588 billion, representing 26.59% of revenue, while integrated supply chain services brought in RMB 1.932 billion, or just 9.19% of the total.

According to Legend Holdings, its financial technology services primarily provide digital transformation support to financial institutions and industry clients, enabling AI to evolve from isolated tools to end-to-end intelligent upgrades across entire business processes.

In practice, this means providing banks with core system development and maintenance, industry cloud services, and infrastructure construction—essentially financial IT outsourcing and systems integration.

While this segment is large in scale, its gross margin is relatively low. The revenue is fundamentally project-based, with downstream clients primarily consisting of banks, which often entail lengthy payment cycles and rising credit risk.

The company’s newly emphasized vision of 'AI-powered supply chain' corresponds to parts of its integrated supply chain services and data intelligence businesses, which together generated less than RMB 7.5 billion in revenue.

In fact, in 2024, Legend Holdings’ business segments primarily included information technology innovation and traditional services, software and operations services, and big data products and solutions. By 2025, however, the company undertook its first major restructuring of business segments, reclassifying them into data intelligence services, integrated supply chain services, and financial technology services and others.

This signals that Legend Holdings has begun comprehensively scaling back its traditional business lines and is now fully focusing on the 'AI + Supply Chain' strategic pathway.

This year, the company also introduced its 'Data×AI' strategy, positioning itself as an 'AI solutions provider centered on the supply chain.' In June 2026, it launched the 'xᴬᴵ·Supply Chain' ecosystem co-creation initiative, proposing a lightweight implementation model featuring 'AI diagnostics within 1–3 days and MVP (minimum viable product) validation within two weeks.'

Moreover, in its 2025 financial report, Legend Holdings introduced a new high-value-added 'service-oriented business' segment, which leverages integrated supply chain operations and data intelligence technologies to deliver fulfillment, e-commerce operations, and digital-intelligence enablement services to clients. Revenue from this segment reached RMB 10.14 billion last year, up 9% year-over-year, accounting for 48% of total revenue.

However, Legend Holdings did not disclose the profit margin for this high-value-added business segment; instead, the company’s profits still primarily rely on its core operations.

In 2025, the company’s integrated supply chain services generated a profit of RMB 175 million, an 18% year-over-year increase, making it the healthiest-margin segment. Data intelligence services contributed only RMB 34 million in profit—though this represented a substantial 197% year-over-year growth, the base was very small. The real profit engine was fintech, which posted a segment profit of RMB 135 million, a significant improvement from the prior year’s loss of RMB 413 million.

While the integrated supply chain business boasts healthy profitability, its revenue scale remains limited; the bulk of earnings still depends on traditional fintech operations. As things stand, Legend Holdings’ vision of becoming a 'supply chain AI leader' appears more like a strategic narrative aimed at capital markets than a realized commercial reality.

2. Technology Implementation vs. Commercial Monetization

Of course, Legend Holdings does have technological strengths to leverage.

In 2026, the company launched the 'Yanyun Trio' built around its 'Yanyun' ecosystem: Yanyun DaaS handles data ingestion from multiple heterogeneous sources, enabling data to be 'extracted'; Yanyun Infinity standardizes data governance and builds business models, making data 'usable'; and Yanyun Cortex, an AI semantic engine, transforms closed enterprise systems into AI-readable 'white boxes,' allowing AI to 'understand' them.

(Image / Legend Holdings Video Channel)

On the application side, in September 2025, KJET—a smart supply chain subsidiary of Legend Holdings—launched the supply chain AI agent 'Xiao Jin,' embedding AI deeply into core operational processes such as order management, warehousing, transportation, and billing to enable end-to-end intelligent collaboration and efficiency gains for enterprises.

This AI agent has already been deployed in practice at KJET’s Kunshan digital-intelligence flagship warehouse.

On the commercialization front, Kecheng has adopted a 'pilot-first, gradual-expansion' strategy. In 2025, it will prioritize launching the 'Xiao Jin' AI agent client version, partnering with industry-leading clients in retail, consumer electronics, and fast-moving consumer goods (FMCG) for pilot trials. Following successful validation of these pilots, the solution will be rolled out across all industries in 2026.

In June this year, Kecheng Supply Chain officially signed an AI and autonomous picking vehicle application contract with the well-known home gardening brand 'Hattie’s Garden.' This collaboration will focus on optimizing picking efficiency across the latter’s thousand-acre facility, reducing reliance on manual scheduling, and addressing challenges posed by gravel road conditions, aiming to establish a fully unmanned picking workflow.

At the World Artificial Intelligence Conference in July this year, Kecheng Supply Chain demonstrated its Daka embodied-intelligence robots operating in a real logistics warehouse at its Wuqing, Tianjin facility. The demonstration showcased the entire process—from task receipt and path planning to cargo identification and sorting/packaging—bringing its AI-powered supply chain solutions into real-world application scenarios.

However, the business logic of empowering supply chains with AI does not yet appear to be fully reflected in the financial data.

In 2025, Digital China Holdings’ integrated supply chain business generated revenue of only RMB 1.932 billion and profit of RMB 175 million. Although the overall business remains healthy and is growing rapidly, its scale is still relatively small.

If AI truly delivers significant efficiency gains, a corresponding jump in profitability should already be evident in the financial statements. Moreover, there is a vast chasm between possessing technical capabilities and realizing their commercial value.

The most direct evidence lies in gross margin. In 2025, Digital China Holdings reported an overall gross margin of just 11.83%, down nearly 1.93 percentage points from 13.76% in 2024, marking a four-year low.

For a company that brands itself as an 'AI solutions leader,' its gross margin is even lower than many traditional IT integrators—a clear indication that high-value-added services represent only a small share of its business, with the bulk of revenue still coming from low-margin system integration and technical outsourcing.

Although Digital China Holdings has built up certain technological capabilities—particularly in the niche areas of data governance and semantic parsing—the gap between 'having technology' and 'generating high-margin technology revenue' hinges on product standardization, depth of industry penetration, and pricing power.

When a company repeatedly highlights its technological foundation yet fails to reflect it in gross margins, the market has every reason to question: are these technologies genuine competitive moats, or merely another form of project-based delivery capability?

A gross margin of 11.83% signals to the market that the road ahead remains long.

3. The actual controller is embroiled in a divorce scandal, triggering a power struggle between state-owned capital and management.

Technology implementation takes time, but neither capital markets nor competitors will wait.

The first pressure facing Legend Holdings stems from a high-profile executive divorce that has shaken capital markets.

Guo Wei, Chairman of the Board and CEO, simultaneously leads three listed companies. In July 2024, his wife, Guo Zhengli, filed for divorce in Hong Kong. Guo Zhengli previously held senior roles at Intel and Microsoft in the Asia-Pacific region and joined Legend Holdings as Chief Operating Officer in 2017. Their professional synergy made them widely regarded as the tech industry’s 'legendary couple.'

Just two months after the divorce filing, Guo Zhengli was removed from all her positions via an internal email, without board approval. Then, in November, the core management team underwent a major reshuffle, with key roles filled by executives from Digital China and Legend Info, both controlled by Guo Wei.

The divorce litigation directly triggered a chain reaction of share freezes.In January 2025, 77.3889 million shares of Digital China held by Guo Wei were judicially frozen, with a market value of approximately RMB 3.4 billion. By February 2026, his remaining shares were also fully frozen.

As a result, Guo Wei’s entire stake of 155 million shares in Digital China—100% of his holdings—has been judicially frozen, with a market value exceeding RMB 5.5 billion, making it one of the largest divorce-related equity disputes in A-share history by amount involved.

In May 2026, the final appellate ruling upheld the divorce judgment, but the asset division plan remains unresolved—meaning Guo Wei’s core assets in Digital China, valued at over RMB 5.5 billion, remain frozen, creating significant uncertainty around control of the company.

Guo Wei is also the actual controller of Legend Holdings. For a publicly listed company actively pushing an AI transformation, it remains to be seen whether the fallout from the controller’s marital breakdown—beyond management reshuffles—will ripple into the execution of corporate strategy.

Meanwhile, within Legend Holdings, power struggles between management and state-owned shareholders are intensifying.

As of December 31, 2025, Guangzhou Urban Construction Investment and Guangzhou Chengtou Jiazi Investment held approximately 19.79% and 17.91% of Legend Holdings’ shares, respectively—both backed by Guangzhou state-owned capital. Guo Wei holds a combined direct and indirect stake of about 20.66%.

The tug-of-war over control became public in 2026: in January, Guangzhou Chengtou Jiazi submitted a proposal to amend the company’s bylaws to restrict management’s authority over large-scale asset disposals, which the board openly opposed on grounds that it was 'not in the best interests of the company and all shareholders.'

Clearly, Guangzhou’s state-owned shareholders and management have developed an open rift over authority for major asset disposals, with their positions failing to align—putting pressure on the company’s governance stability.

Now, management changes triggered by the controller’s marital split and activist moves by state-owned shareholders are compounding internal governance uncertainties, even as external competitive pressures mount.

Legend Holdings’ ‘supply chain AI’ ambition isn’t venturing into uncharted territory—Cainiao, JD Logistics, and SF Technology are all racing for it. Alibaba and JD.com possess far larger data volumes and stronger computing resources, leaving Legend Holdings with a window of perhaps only two to three years.

(Image / Shezhaiwang, based on VRF (AI-generated content))

The company’s ace lies in over two decades of physical supply chain experience. Its subsidiary Kecheng operates real warehouses, real vehicles, and real deliveries—processing over 100 million shipping orders in 2025, with a net renewal rate of 100% among existing clients. This hard-earned industry know-how from doing the ‘dirty, tough work’ is difficult for giants to replicate in the short term.

But a strong legacy doesn’t guarantee speed. When internal governance falters, even the best strategic vision struggles to take root. Transitioning from a ‘veteran IT integrator’ to a ‘supply chain AI leader,’ its RMB 21 billion revenue is both a foundation and a burden. The key question is whether the company can find a truly viable path between today’s thin margins and tomorrow’s compelling narrative.

Time waits for no one, and neither does the race track.

*Note: The featured image in this article is from the official WeChat account of Digital China Holdings; other uncredited images are sourced from SheTu.com under the VRF license.

7079 Views