While Software Ate the World, This Company Ate Its Own Software Business

Editor’s note: This short article is republished from Jumpstarta TechNode Group publication.

In 2023, AI software application was DataCanvas’s organization. By the very first half of 2026, it was nearly missing from its sales.

The modification is uncommonly plain. AI fundamental software application services created 76.5% of the Chinese business’s earnings in 2023. 3 years later on, their contribution had actually been up to 0.1%.

This was more than an old department being eclipsed by a faster-growing one. Software-service income itself contracted– from RMB81.3 million in 2023 to less than RMB500,000 in the very first 6 months of 2026. Overall yearly profits climbed up from RMB106.2 million in 2023 to RMB1.10 billion in 2025, a compound yearly development rate of 221.5%.

DataCanvas had actually developed a various organization.

The Beijing business, understood in China as 九章云极, started rerouting its resources towards calculating facilities in early 2023. It consequently included cloud services, turning from a provider of software application tools into a business that assists put together calculating facilities and offers access to its capability.

On September 29, 2026, it declared a Hong Kong notingThe application opens a window onto that reinvention: a business established more than a years back, approaching the general public market with its initial income engine successfully turned off.

news Before the Servers

DataCanvas was developed in 2013, long before generative AI made calculating facilities a mainstream service story.

Its early proposal was to assist companies deal with information and construct machine-learning designs. A visual modelling platform followed in 2014, with subsequent items extending throughout design advancement and implementation.

These tools dealt with an uncomfortable space inside business. Having information did not suggest a business might easily turn it into a working design. Constructing a design did not imply it might be dependably included into daily operations.

DataCanvas used software application to bridge those actions. Its items assisted consumers prepare information, construct analytical workflows and put designs to work.

Constructing the innovation was not the exact same as discovering an organization.

In 2022, creator and chairman Fang Lei remembered that the group had actually invested its early years focusing on code while ignoring the marketplace. The creators were skilled engineers; comprehending what clients would really spend for took longer.

Banks ended up being a crucial entry point. They had considerable information, developed innovation spending plans and factors to enhance how info notified choices. Dealing with such consumers provided DataCanvas a business setting for its tools– and a clearer understanding of what it suggested to offer them.

The business provided business the ways to establish and utilize artificial intelligence. Clients still needed to supply the computing environments in which those tools would run.

That limit would end up being the next service chance.

news The Decision to Change business

By 2023, big AI designs were making the equipment behind software application much more difficult to overlook.

Clients required significant computing resources, collaborated throughout processors, networks and storage. They needed to acquire that capability, make the elements collaborate and keep work running.

For DataCanvas, this opened an option: continue offering software application into those environments, or take duty for more of the facilities itself.

It selected the latter.

The business started offering computing facilities services in 2023 and signed its very first job agreement that September. These were bigger projects than providing a standalone software application platform. They included developing the computing environment, obtaining and incorporating hardware, and releasing systems to support clients’ work.

DataCanvas rerouted resources towards the brand-new operation while gradually withdrawing from its initial software-service organization.

The business effects appeared rapidly. Facilities options created RMB24.9 million in 2023. By 2025, they generated simply over RMB1 billion and represented 91.2% of overall profits.

The old service relocated the opposite instructions. Its earnings fell in both 2024 and 2025.

This was the definitive break in DataCanvas’s history. Offering tools had actually provided it a function inside consumers’ innovation operations. Providing facilities made it accountable for more of the environment those operations depended upon.

The business had actually moved more detailed to the equipment– and handled a bigger share of the work.

news Construct It, Then Keep It Running

The next action came when DataCanvas introduced its cloud service in September 2024.

A facilities job assists a client develop computing capability. A cloud service lets consumers gain access to capability without organizing a whole setup themselves.

For DataCanvas, that indicated moving beyond task shipment towards a continuous operating relationship.

The very first cloud-service profits was small: RMB196,000 in 2024. It increased to RMB77.6 million in 2025 and reached RMB153.8 million in the very first half of 2026. Already, cloud services provided 26.1% of income, along with the 73.8% produced by facilities options.

Its cloud-service business consumer count increased from 2 in 2024 to 75 in 2025 and 84 in the very first half of 2026.

That development offers the reinvention 2 unique phases. Facilities tasks initially developed the scale of the brand-new organization. Cloud services then started altering how the business kept and monetized its relationship with clients.

A finished setup might produce job profits. Offering access to calculating capability developed a factor for consumers to keep purchasing.

The software application business had actually ended up being a facilities company. It was now likewise ending up being an operator.

news What Survived the Reinvention

DataCanvas did not stop composing software application when software application services stopped driving its sales.

It presented Alaya NeW OS in April 2024, putting a software application control layer at the centre of its more recent company. The system collaborates calculating resources and the work utilizing them. Its subsequent cloud platforms develop on that structure.

This is the exposing stress in the change. DataCanvas was withdrawing a method of offering software application while maintaining the engineering that made its brand-new services work.

Formerly, the platform was something a client purchased. Significantly, it ended up being the system through which DataCanvas provided another item: functional computing capability.

The business likewise established its own computing measurement system, DCU, which it markets in China as “one degree of calculating power,” echoing the daily expression for a system of electrical energy.

The concept is to make computing simpler to determine and acquire throughout various resources, with charges connected to usage. It reveals the business’s brand-new aspiration in useful terms: clients must have the ability to purchase computing as a service without putting together every component required to produce it.

For DataCanvas, this provided a various response to a concern it had experienced early in its life: what should a business purchase from the business?

Its very first response was software application that assisted clients establish and release designs. Its more recent response consisted of the resources on which those designs run.

news The Price of Starting Again

Changing a company can produce an incredible development chart. It likewise alters what development expenses.

DataCanvas reported a general gross margin of 40.6% in 2023, being up to 11.7% in 2024 as facilities options ended up being the dominant source of sales. The margin recuperated to 17.4% in 2025 and 31% in the very first half of 2026.

The preliminary decrease reveals the range in between the 2 organizations. A facilities agreement can consist of considerable hardware procurement and implementation work. A much bigger order can for that reason bring a much bigger expense of shipment.

Running computing services includes another set of needs. Capability should be offered when clients require it, supported by systems that designate resources and keep work operating. Winning an order is just part of the task.

DataCanvas integrates plans with facilities owners and partners with financial investment of its own. Moving into calculating shipment nonetheless brings devices expenses, capability dedications and the continuing job of turning offered resources into paying use.

Success stays incomplete. Its changed bottom line narrowed from RMB194.3 million in 2023 to RMB91.3 million in 2025, then to RMB14.9 million in the very first half of 2026.

Its reported first-half loss was much bigger, at RMB1.09 billion, mainly due to the fact that of RMB1.07 billion in fair-value modifications in monetary liabilities. That accounting charge describes the majority of the space in between the reported and changed figures.

DataCanvas has actually shown that it can change its old income. It is still developing just how much it can make from the replacement.

news Taking the New Company Public

The Hong Kong IPO shows up 3 years into the improvement.

DataCanvas prepares to utilize the earnings to enhance research study and advancement, broaden calculating resources for its data-centre tasks, establish sales channels and assistance operating capital. Hardware procurement types part of the proposed capability growth.

Those strategies extend the choice made in 2023. The business is looking for capital to deepen a company that has currently improved its operations and earnings.

For potential investors, the job is to comprehend what that company has actually ended up being. DataCanvas brings the history and technical abilities of a software application business. The majority of its income now originates from facilities shipment, while cloud operations represent a growing share.

Its starting identity no longer explains how it makes the majority of its cash.

What makes DataCanvas unique is the degree of the option it has actually currently made. It invested a years structure tools for business to utilize AI, then intentionally stepped far from offering those tools as its primary organization. In their location, it developed the facilities and services required to keep those systems running.

The profits change is mostly total. The Hong Kong noting brings the next concern into public view: whether business DataCanvas picked to end up being can turn its reinvention into resilient profits.