XChange TEC.INC Plunges 16.67% Amid Financial Distress

On May 14, 2025, XChange's stock experienced a significant drop of 16.67% in pre-market trading, reflecting a substantial decline in investor confidence.

XChange TEC.INC recently performed a 1 for 20 reverse stock split, which means shareholders now hold 1 share for every 20 shares they previously owned. This move is part of the company's broader strategy to manage its financial obligations and improve its capital structure.

Additionally, XChange TEC.INC completed a significant financial transaction with Infinity Asset Solutions Ltd., converting a portion of its debt into equity by issuing over 108 billion Class A ordinary shares. The company also adopted a 2025 Equity Incentive Plan, issuing 11.8 billion Class B ordinary shares to Golden Stream Ltd. to incentivize its employees. These actions are expected to enhance the company’s financial flexibility and align employee interests with company performance.

Despite these efforts, XChange TEC.INC is facing severe financial distress, with declining revenue and negative cash flows indicating ongoing operational challenges. Technical analysis signals a bearish trend with strong downward momentum, further underscoring the company’s weak financial position.