YiduCloud Files for Hong Kong IPO: Proprietary Data Intelligence Infrastructure YiduCore Drives Triple-Digit Revenue Growth for Three Consecutive Years

China’s medical artificial intelligence industry is developing rapidly, making continuous and meaningful progress.

Recently, Yidu Cloud, a leading medical AI enterprise, submitted its listing application to the Hong Kong Stock Exchange. With an increasingly mature business system and exponential growth in revenue and gross profit... Yidu Cloud’s prospectus acts like a “magnifying glass,” not only revealing the company’s assets but also reflecting the booming development of China’s medical AI and big data industry.

The prospectus reveals that Yidu Cloud’s revenue and gross profit both experienced substantial growth over the past three fiscal years. The “snowball effect” of its independently developed data intelligence infrastructure, YiduCore, has begun to emerge, with a business ecosystem built upon it taking shape. The monetization capability of its big data platform and solutions was prominently demonstrated in fiscal year 2020. Meanwhile, its life sciences solutions and health management platforms and solutions, which have been cultivated in recent years, are gradually showing an upward trend in profitability.

So, how did Yidu Cloud build its technological barriers and explore business models in the cross-disciplinary field of “healthcare + technology”? VCBeat analyzed Yidu Cloud’s prospectus to provide insights.

As is well known, with the intensifying aging of the population, imbalances in the medical supply chain have become increasingly prominent, imposing significant supply-side constraints on the healthcare industry. Public information indicates that by 2035, China’s elderly population may approach 400 million, with a considerable risk of individuals falling into poverty or returning to poverty due to illness. Digital technology is widely regarded as the key to breaking through the imbalance between medical supply and demand. Moreover, the past decade has witnessed rapid development in healthcare informatization in China, generating massive amounts of medical data. However, under the broader trend of advancing precision medicine, fragmented storage and low levels of data structuring have become bottlenecks hindering the full realization of this data’s value.

In this context, it is imperative to leverage cutting-edge technologies to unlock the scientific and clinical value of medical data. Consequently, as efforts accelerate to implement artificial intelligence and big data technologies in the healthcare sector, a wave of health technology enterprises has emerged. These companies, relying on their proprietary technological strengths and collaborating with key industry stakeholders, are developing innovative solutions. In 2014, Yidu Cloud was established, becoming a prominent pioneer in the industry.

Market Size of China's Medical Big Data Solutions Disclosed in the Prospectus

The growth of emerging industries cannot be separated from the nourishment of policy support.

Since the State Council issued the Guiding Opinions on Promoting and Regulating the Application and Development of Health and Medical Big Data in 2016, the Chinese government has repeatedly emphasized the development of the medical big data industry in key policy documents such as the Outline of the “Healthy China 2030” Plan and the 13th Five-Year Plan for Health and Wellness. In 2018, the National Health Commission further provided a standardized framework for industrial development by releasing the Administrative Measures for Standards, Security, and Services of National Health and Medical Big Data (Trial).

In response to the national call, various regions have successively introduced corresponding regulations and policies, and collaborated with medical big data enterprises to promote the application and development of technology.

Market Demand and Policy Support Create a Favorable Environment for the Medical AI Industry. According to estimates in an Ernst & Young report, the market size of medical big data solutions has grown rapidly over the past five years, with a compound annual growth rate (CAGR) of 54.2%. In 2015, the total market size was less than RMB 2 billion, but by 2019, it had successfully surpassed the RMB 10 billion mark.

The EY report also shows that the market penetration rate of big data solutions in the hospital and government segments was only 5% in 2015, exceeding 15% by 2019. EY predicts that this figure will surpass 30% around 2024.

Yidu Cloud has been actively promoting the integration of healthcare and technology amid this trend, thereby achieving its leap from a startup to listing on the secondary market.

So, how can the integration of healthcare and data bear fruit? VCBeat has found that Yidu Cloud has adopted a development path from “data foundation” to “data application.” In its early stages, Yidu Cloud collaborated with hospitals and government entities, leveraging its self-developed intelligent data infrastructure, YiduCore (the “Healthcare Brain”), to solidify its technological foundation. It then empowered key stakeholders across the industry, gradually identifying application scenarios and achieving commercialization.

YiduCore-Powered Ecosystem

The key to Yidu Cloud’s core competitiveness lies in its independently developed data intelligence infrastructure, YiduCore. YiduCore possesses advanced capabilities for efficient medical data processing. Authorized medical data is further standardized and structured using YiduCore’s technology, enabling computers to understand, process, and analyze it—thereby transforming “difficult-to-use” medical data into “user-friendly” data. The prospectus also indicates that throughout the entire data processing workflow, Yidu Cloud has implemented a rigorous system for medical data compliance and quality control, ensuring that the final quality of medical data meets national and industry standards.

Once medical data becomes “usable,” the analysis process naturally becomes smoother. Yidu Cloud leverages statistical tools and AI technologies—such as knowledge graphs, symbolic knowledge reasoning models, and deep learning—to continuously generate insights and knowledge for the healthcare industry. As customers frequently use solutions powered by YiduCore, the platform continually produces these insights and knowledge, which in turn empower more customers, creating a virtuous cycle within the system.

YiduCore Technical Architecture

After several years of development, YiduCore has established a robust multi-layered technical architecture and is capable of providing diverse solutions tailored to various stakeholders across the healthcare industry chain. It has formed a business system primarily composed of three major segments: Big Data Platforms and Solutions, Life Sciences Solutions, and Health Management Platforms and Solutions. Each business segment serves different roles within the healthcare industry.Three Major Segments Exerting Their Respective Strengths to Accelerate Layout Across the Healthcare Industry Chain.

Big Data Platform and Solutions is Yidu Cloud’s largest division, serving hospitals and other healthcare institutions, regulatory bodies, and policymakers. The platform conducts in-depth processing and analysis of large-scale, multi-source, heterogeneous medical data to build real-world disease domain models, thereby supporting medical research, healthcare management, and government public policy decision-making.

Life Science Solutions refer to solutions provided to professionals in the life sciences industry, designed to help them reduce the time and cost of clinical development while simultaneously improving clinical and market success rates.

Health Management Platforms and Solutions is Yidu Cloud’s newest division, holding immense potential. In this segment, Yidu Cloud operates a research-driven personal health management platform that leverages digital tools to help physicians better manage patients while providing personalized care services to individuals.

At this point, Yidu Cloud’s three major business segments have successfully covered the six key stakeholders in the healthcare industry—namely, governments, hospitals, pharmaceutical and medical device companies, insurance institutions, physicians, and patients—thereby gradually building an industrial ecosystem.

Overall, Yidu Cloud has built its core technical infrastructure by starting with hospitals, and then leverages this technological foundation to empower other segments of the healthcare industry. Is this business model viable? Let’s examine Yidu Cloud’s revenue performance.

Partial Financial Data

It is evident from the financial data disclosed by Yidu Cloud that its revenue achieved rapid growth during the 2018–2020 fiscal years,From RMB 22.727 million in fiscal year 2018 to approximately RMB 558 million in fiscal year 2020, representing a triple-digit growth rate, with year-on-year growth rates of 348.9% and 447.1% respectively over the past three years.Meanwhile, as its business system has gradually matured, Yidu Cloud has moved out of the gross profit pressure state it experienced in fiscal year 2018, turning negative into positive, toIn fiscal year 2020, the gross profit reached approximately RMB 147 million, with a gross profit margin of 26.3%.

Meanwhile, losses are narrowing further.Adjusted net loss narrowed by approximately 22.9%, from RMB 419 million in fiscal year 2019 to RMB 323 million in fiscal year 2020.

Clearly, fiscal year 2020 marked a strong start for Yidu Cloud’s commercial expansion.

Revenue Structure

Specifically, for each business segment in fiscal year 2020, the big data platform and solutions remained Yidu Cloud’s largest business segment, accounting for 66.6% of total revenue. Although other business segments, such as life sciences solutions and health management platforms and solutions, also achieved rapid growth, they hold substantial development potential relative to the scale of the company’s core business and market demand.

Gross Profit Structure

Regarding gross profit margin, Yidu Cloud also admitted in its prospectus that during the early stage of development, the company focused on consolidating YiduCore. During this period, the business mainly involved building data intelligence infrastructure for hospitals, which put pressure on overall gross profit. However, through this process, Yidu Cloud gained profound insights and knowledge from YiduCore, which were applied to solution development in broader application scenarios. With the expansion of its customer base and the maturation of its solutions, the profitability of Yidu Cloud’s solutions has significantly improved.

In other words, in its early development stage, Yidu Cloud provided cost-effective solutions to hospitals and government entities, with the aim of refining its YiduCore product while cultivating the market. The breakthrough in profitability achieved in fiscal year 2020 was an inevitable outcome of the maturation of Yidu Cloud’s solutions.

Among other business segments, the Life Sciences Solutions segment is expected to deliver stronger gross margin performance. In the early stages, gross margins faced temporary pressure due to the need to build brand awareness, unproven value propositions, and expenses related to team development. However, as the company’s advantages in artificial intelligence and big data become more pronounced, brand recognition grows, and its value is validated, gross margins are gradually improving. Data from the prospectus already reflects this trend: in fiscal year 2020, the gross margin for this solution rose to 13.4%, up from 2.1% in 2018. Therefore, VCBeat believes that the future gross margin level of the Life Sciences Solutions segment will continue to rise as its solutions become increasingly mature.

The changes in the revenue structure among various segments of Yidu Cloud in the future can be analyzed from both short-term and long-term perspectives.

In the short term, China’s medical big data industry remains in its early stages of development. Although there has been some penetration among hospitals and government entities, substantial room for growth still exists. Therefore, Yidu Cloud is expected to continue focusing on hospital and government clients in the coming years, until the penetration rate of medical big data solutions in these two sectors reaches a threshold level.

In the long term, the market size of other solutions, such as life science solutions and health management platforms, ensures Yidu Cloud’s future market potential. Meanwhile, Yidu Cloud’s penetration rate among hospital and government clients reinforces its competitiveness in medical data and solutions.

Healthcare is a unique sector that directly impacts people's livelihoods; it requires adherence to a long-term strategic approach, with top-level designers and key industry participants working together to drive progress. Yidu Cloud’s primary objective in applying for this listing is to secure additional capital to support its next phase of development—strengthening its technology and building an ecosystem.

In the next phase of development, Yidu Cloud plans to “strengthen both internal and external capabilities”: internally, it will continue to solidify its technological moat by focusing on infrastructure; externally, it will enhance marketing efforts and pursue investment and mergers and acquisitions.

Future Development Directions

Specifically, the financing proceeds will be primarily allocated to three areas: strengthening the company’s core capabilities, further business expansion, and enriching the ecosystem. Its strategic initiatives will also revolve around these three pillars.

In terms of enhancing core capabilities, Yidu Cloud will continue to strengthen its data processing capabilities and increase ongoing investment in and technological iteration of the YiduCore infrastructure.

For example, we will continue to strengthen our team by attracting and retaining top talent in the fields of artificial intelligence and data science, and actively collaborate with leading global technology companies, universities, and research institutions to accelerate technological innovation.

Yidu Cloud also plans to continue collaborating with top researchers at universities and hospitals to deepen its understanding of various disease areas and enrich its use cases. This enhancement in knowledge and use cases will further expand Yidu Cloud’s competitive advantages and drive profit growth for its solutions.

In terms of business expansion, with a clear business model in place, Yidu Cloud needs to expand its achievements by retaining more existing customers through high-quality solutions while enhancing customer connectivity to broaden its customer base. Yidu Cloud will also enter the international market, with Southeast Asia expected to be the primary focus of its initial phase of internationalization.

In terms of enriching the ecosystem, Yidu Cloud will continue to enrich its ecosystem by seeking strategic partnerships, investments, alliances, and mergers and acquisitions as a complement to its organic growth strategy.

2020 was clearly a memorable year for Yidu Cloud. During this period, the company achieved business and market expansion, and more importantly, recorded breakthroughs in both revenue and profit. A successful IPO would further drive its expansion in the capital markets.

The application and development of big data in healthcare is a crucial component of the "Healthy China 2030" strategy, with policy support continuing to play a key role. However, there is no standard template for the application of medical big data; both technological R&D and commercialization pathways require further practical exploration. As a pioneer, Yidu Cloud’s progress in product development and market promotion, as well as its performance in the capital markets, has naturally drawn significant attention from the industry. Success in any of these areas would help bolster confidence across the sector.