Investment Rating - The report maintains an "Accumulate-A" rating for the company, indicating a positive outlook with expected price appreciation relative to the benchmark index [1][3]. Core Insights - The company has established itself as a leading player in the domestic telecommunications server market, with a market share of 23.03% as of May 30, 2024, according to the Communication Industry Network [1]. - The company is focusing on intelligent computing as a long-term strategic direction, providing comprehensive solutions and leveraging its self-developed chips to create differentiated system advantages [1]. - The company reported a revenue of 900.45 billion yuan for the first three quarters of 2024, reflecting a year-on-year increase of 0.73%, while the net profit attributable to shareholders was 79.06 billion yuan, up 0.83% year-on-year [1][2]. Financial Performance Summary - For Q3 2024, the company achieved a revenue of 275.57 billion yuan, a decrease of 3.94% year-on-year and 13.64% quarter-on-quarter [1]. - The gross margin for Q3 2024 was reported at 40.4%, down 4.3 percentage points year-on-year but up 1.4 percentage points quarter-on-quarter [2]. - The company’s operating expenses increased slightly in Q3, with sales, management, and R&D expense ratios at 8.0%, 3.6%, and 21.5%, respectively [2]. Earnings Forecast and Valuation Analysis - The company is projected to achieve net profits of 95.3 billion yuan, 103.0 billion yuan, and 111.5 billion yuan for the years 2024, 2025, and 2026, respectively, with year-on-year growth rates of 2.2%, 8.1%, and 8.2% [3]. - The expected earnings per share (EPS) for 2024, 2025, and 2026 are 1.99 yuan, 2.15 yuan, and 2.33 yuan, respectively, with corresponding price-to-earnings (P/E) ratios of 13.5, 12.5, and 11.6 [3].

Investment Rating - The investment rating for the company is "Buy" with a 6-month outlook [1][5]. Core Views - The company reported a revenue of 90.04 billion yuan for the first three quarters of 2024, a year-on-year increase of 0.7%, and a net profit attributable to shareholders of 7.91 billion yuan, up 0.8% year-on-year [1]. - The domestic operator business is under pressure, but effective cost control measures are in place, and the deepening of "connection + computing power" is aiding AI development [1][2]. - The company is focusing on research and development, with R&D expenses amounting to 18.64 billion yuan, representing 20.7% of revenue, which supports technological innovations in 5G-A, optical networks, and AI solutions [4]. Summary by Sections Financial Performance - For Q3 2024, the company achieved a revenue of 27.557 billion yuan, a decline of 3.94% year-on-year, and a net profit of 2.174 billion yuan, down 8.23% year-on-year [1]. - The gross margin for the first three quarters was 40.43%, a decrease of 3.24 percentage points compared to the same period last year [3]. Business Segments - The domestic operator network business is facing challenges due to the investment environment, while international markets continue to grow at double-digit rates [2]. - Consumer and government enterprise businesses have shown rapid growth, benefiting from demand for computing power and connectivity [2]. Cost Management - The company has successfully reduced sales, management, and R&D expenses year-on-year, indicating effective cost control [3]. - Financial expenses increased due to exchange rate fluctuations, but impairment losses have significantly narrowed, reflecting improved cost management [3]. Research and Development - The company is committed to R&D, with significant investments aimed at enhancing its capabilities in AI and telecommunications [4]. - Innovations include the launch of AI servers compatible with mainstream GPUs and the development of self-researched large models for various applications [4]. Profit Forecast and Investment Advice - The operator business is expected to stabilize in the short term, while the government enterprise business is projected to accelerate growth due to demand for computing power and connectivity [5]. - The company’s revenue is anticipated to remain stable, with improved profitability expected from effective cost management [5].

Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company reported a slight decline in performance for the third quarter of 2024, with a year-on-year revenue increase of 0.73% to CNY 90.045 billion and a net profit attributable to shareholders of CNY 7.906 billion, up 0.83% year-on-year [1] - The third quarter revenue was CNY 27.557 billion, representing a year-on-year decline of 3.94% and a quarter-on-quarter decline of 13.64% [1] - The gross margin for the third quarter was 40.35%, down 4.28 percentage points year-on-year [1] - The company maintains a leading position in both wireless and wired core products, with stable domestic market share and growth in specific segments such as indoor distribution and high-speed rail [1] - The company is actively expanding into 5G-A innovations and has secured projects in international markets, including Cameroon and Côte d'Ivoire [1] Financial Performance Summary - For the first three quarters of 2024, the company achieved total revenue of CNY 90.045 billion, with a net profit of CNY 7.906 billion [1] - The projected revenue growth rates for 2024 to 2026 are 4.58%, 5.84%, and 5.83%, respectively, with expected revenues of CNY 129.94 billion, CNY 137.53 billion, and CNY 145.55 billion [2] - The projected net profit for the same period is expected to be CNY 10.111 billion, CNY 11.329 billion, and CNY 12.722 billion, with corresponding P/E ratios of 14.2, 12.7, and 11.3 [2][3] - The company’s total assets are projected to grow from CNY 180.954 billion in 2022 to CNY 251.021 billion by 2026 [4][5] Market Position and Competitiveness - The company has maintained a dual oligopoly in the domestic core network product market and has made significant inroads in international markets, including Thailand and several African countries [1] - The company’s wired products continue to lead globally, with market share growth in Italy, Indonesia, and Brazil [1] - The company is positioned as a key player in the digital economy, focusing on "connection + computing power" as its main strategy [1]

Investment Rating - The report maintains a "Buy" rating for the company, citing a positive outlook in the context of digital China construction and increasing AI computing power demand [2][7]. Core Insights - The company reported a revenue of 90.045 billion yuan for the first three quarters of 2024, a year-on-year increase of 0.73%, and a net profit attributable to shareholders of 7.906 billion yuan, up 0.83% year-on-year. However, the net profit excluding non-recurring items decreased by 2.86% [1]. - In Q3 2024, the company's revenue was 27.557 billion yuan, a year-on-year decline of 3.94%, and the net profit attributable to shareholders was 2.174 billion yuan, down 8.23% year-on-year. The gross margin was 40.35%, a decrease of 4.28 percentage points year-on-year [1]. - The decline in revenue and profit is primarily attributed to the pressure on operator business due to reduced capital expenditure from operators [1]. Summary by Sections Revenue and Profitability - The company achieved a revenue of 90.045 billion yuan in the first nine months of 2024, with a slight increase of 0.73% year-on-year. The net profit attributable to shareholders was 7.906 billion yuan, reflecting a growth of 0.83% year-on-year. However, the net profit excluding non-recurring items saw a decline of 2.86% [1]. - For Q3 2024, the revenue was 27.557 billion yuan, down 3.94% year-on-year, and the net profit attributable to shareholders was 2.174 billion yuan, a decrease of 8.23% year-on-year [1]. Market Position and Innovations - The company continues to lead in key products in both wireless and wired markets, ranking second globally in cumulative shipments of 5G base stations and core networks. It has also received industry leader ratings for RAN products, 5G core networks, and 5G optical transmission [1]. - The company is focusing on the commercial deployment of 5G-A and has collaborated with operators to innovate across various scenarios, enhancing new business vitality in ground, low-altitude, and high-altitude sectors [1]. Strategic Focus - The company has identified intelligent computing as a long-term strategic focus, offering comprehensive intelligent computing solutions. It has launched an open architecture AI server compatible with mainstream GPUs and is advancing research in high-capacity switching chips and intelligent task distribution [1]. - The company emphasizes the integration of infrastructure delivery and engineering services for large model training and applications, promoting the establishment of intelligent computing infrastructure projects across various regions and industries [1].

Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company has maintained steady performance with double-digit growth in international markets, despite a slight decline in domestic operator business due to investment environment pressures. The forecast for net profit from 2024 to 2026 has been adjusted downwards, but the long-term outlook for operator and government enterprise business remains positive [2][3] - The company is accelerating its transition towards a "connectivity + computing power" model, enhancing its product ecosystem and maintaining a leading position in key wireless and wired markets [3] - The company continues to invest heavily in R&D, with a R&D expense rate of 20.7% in the first three quarters of 2024, focusing on advanced technologies and self-developed chips [4] Financial Summary - For the first three quarters of 2024, the company achieved revenue of 900.45 billion yuan, a year-on-year increase of 0.73%, and a net profit attributable to shareholders of 79.06 billion yuan, up 0.83% year-on-year [2] - The projected net profit for 2024-2026 is 90.52 billion yuan, 99.19 billion yuan, and 112.61 billion yuan respectively, with corresponding P/E ratios of 16.8, 15.3, and 13.5 [2][5] - The company’s revenue for 2024 is expected to be 123.545 billion yuan, reflecting a slight decline of 0.6% year-on-year, while net profit is projected to be 9.052 billion yuan, down 2.9% year-on-year [5] Product and Market Development - The company has launched new products in the 5G-A field and has deepened collaborations with operators for commercial deployment [3] - In the optical transmission sector, the company introduced an 800G OTN pluggable solution capable of 2000 km transmission, and new intelligent optical access products based on 50G PON technology [3] - The company is expanding its AI capabilities with the launch of AI-enabled smartphones and the Nubia brand's international expansion [3]

Investment Rating - The report maintains a "Buy" rating for the company [4][6][7] Core Views - The company reported a revenue of 900.45 billion yuan for the first three quarters of 2024, a year-on-year increase of 0.73%, and a net profit attributable to shareholders of 79.06 billion yuan, up 0.83% year-on-year. However, the non-recurring net profit decreased by 2.86% year-on-year [2][6] - The company is focusing on building an open intelligent computing ecosystem as a long-term strategic direction, with a significant emphasis on providing comprehensive intelligent computing solutions [6][7] - Despite short-term pressure on performance, the company has seen rapid growth in its government and enterprise business as well as consumer business [2][6][7] Financial Performance Summary - For Q3 2024, the company reported a revenue of 275.57 billion yuan, a year-on-year decrease of 3.94%, and a net profit of 21.74 billion yuan, down 8.23% year-on-year. The gross margin for Q3 was 40.35%, an increase of 1.37 percentage points quarter-on-quarter [6][7] - The company expects revenues for 2024-2026 to be 1258.92 billion yuan, 1327.56 billion yuan, and 1409.42 billion yuan, with year-on-year growth rates of 1.32%, 5.45%, and 6.17% respectively [7][8] - The projected net profit for the same period is 98.67 billion yuan, 104.43 billion yuan, and 108.90 billion yuan, with growth rates of 5.80%, 5.84%, and 4.28% respectively [7][8] Strategic Initiatives - The company is actively advancing the deployment of 5G-A technology, collaborating with operators to create an integrated 5G-A network that stimulates new business opportunities in various sectors [7] - The establishment of an open intelligent computing laboratory aims to enhance multi-vendor GPU interconnectivity and optimize compatibility testing for large models [6][7]

Investment Rating - The report maintains an "Accumulate" rating for the company with a target price based on a market capitalization of 151.68 billion [1][3]. Core Views - The company's revenue for Q1-Q3 2024 reached 90.04 billion, a year-on-year increase of 0.7%, while the net profit attributable to shareholders was 7.91 billion, up 0.8% year-on-year. However, the net profit excluding non-recurring items decreased by 2.9% to 6.90 billion [1]. - In Q3 2024, the company reported revenue of 27.56 billion, a decrease of 3.9% year-on-year, and a net profit of 2.17 billion, down 8.2% year-on-year [1]. - The domestic operator business faced pressure due to a decline in capital expenditures, while the international market continued to grow at double-digit rates [1]. - The company is focusing on "connection + computing power" and has made significant advancements in both connectivity and computing power sectors, including leading positions in 5G base station shipments and fixed network product market share [1]. - The gross margin for Q1-Q3 2024 was 40.4%, a decrease of 3.2 percentage points year-on-year, while the net margin remained stable at 8.7% [1][2]. Summary by Sections Financial Performance - For Q1-Q3 2024, the company achieved a revenue of 90.04 billion, with a net profit of 7.91 billion, and a net profit excluding non-recurring items of 6.90 billion [1]. - In Q3 2024, the revenue was 27.56 billion, with a net profit of 2.17 billion and a net profit excluding non-recurring items of 1.93 billion [1]. - The gross margin for Q1-Q3 2024 was 40.4%, and the net margin was 8.7% [1]. Business Segments - The operator business is under pressure due to a decline in capital expenditures, while the international market is experiencing double-digit growth [1]. - The company is enhancing its connectivity and computing power capabilities, with significant advancements in 5G and AI server technologies [1]. - The consumer and government enterprise businesses are also growing rapidly [1]. Research and Development - The company is increasing its R&D investments, focusing on 5G, optical networks, and intelligent computing [1]. - The R&D expense ratio reached 20.7% for Q1-Q3 2024, reflecting the company's commitment to innovation [1][2]. Cash Flow and Asset Management - The operating cash flow for Q3 2024 was 8.05 billion, with a revenue cash ratio of 1.06 [2]. - Inventory decreased by 10.0% year-on-year to 40.63 billion, primarily due to reduced shipments [2].

中兴通讯（000063.SZ）2024 年三季报点评 [盈利预测与财务指标 Table_Forcast] Q3 业绩承压，深化布局"连接+算力"助力 AI 向实 2024 年 10 月 22 日 ➢ 事件：2024 年 10 月 21 日，公司发布三季报，24 年前三季度营收为 900.4 亿元，同比增长 0.7%；归母净利润 79.1 亿元，同比增长 0.8%；扣非净利润 69.0 亿元，同比下降 2.9%。单季度看，24Q3 实现收入 275.6 亿元，同比下降 3.9%， 环比下降 13.6%；归母净利润 21.7 亿元，同比下降 8.2%，环比下降 27.3%；扣 非净利润 19.3 亿元，同比下降 11.7%，环比下降 16.4%。 ➢ 运营商业务承压，政企和消费者业务快速增长。 分业务看，前三季度，三大运营商资本开支下滑（24H1 资本开支总额同比下降 10.3%）背景下，公司国内运营商网络业务受投资环境影响整体承压，国际市场 持续突破大国大 T，保持双位数增长；消费者业务和政企业务均快速增长。 ➢ 毛利率因收入结构下滑，费用控制成效凸显。 24Q3 毛利率为 40.4%，同比下降 4.3pct， ...

Investment Rating - The report maintains a "Buy" rating for the company [1] Core Views - The company reported a revenue of 90.045 billion RMB for the first three quarters of 2024, a year-on-year increase of 0.73%, and a net profit attributable to shareholders of 7.906 billion RMB, up 0.83% year-on-year [1] - In Q3 alone, the company experienced a revenue decline of 3.94% year-on-year, with a net profit decrease of 8.23% [1] - The operator business is under short-term pressure due to a decline in capital expenditure, but the net profit margin remains stable [1] - The company is actively transitioning from a "connectivity" model to a "connectivity + computing power" model, aiming to expand market space [1] - The company has introduced the OLink open exchange interconnection standard and developed high-capacity switching chips to support AI server capabilities [1] - The terminal business is rapidly advancing, with the company leading the cloud terminal market in China [1] Summary by Sections Financial Performance - For 2024-2026, the company is projected to achieve revenues of 130.8 billion, 140 billion, and 151.3 billion RMB, respectively, with net profits of 10.3 billion, 11.3 billion, and 12.7 billion RMB [1][4] - The corresponding P/E ratios are expected to be 15, 13, and 12 times [1] Business Strategy - The company is focusing on integrating edge computing solutions to meet the rapid deployment needs of small and medium enterprises [1] - The Nebula large model architecture supports collaborative deployment of cloud and edge computing, offering a range of intelligent edge hardware [1] Market Position - The company has been recognized as the market leader in cloud terminal shipments and VDI solution shipments in China [1] - Recent product launches include advanced AI terminals and cloud computer terminals compatible with China Mobile's capabilities [1]

Investment Rating - The investment rating for the company is "Outperform the Market" and is maintained [2] Core Views - The company reported a revenue of 900.45 billion yuan for the first three quarters, a year-on-year increase of 0.73%, with a net profit attributable to shareholders of 79.06 billion yuan, up 0.83% year-on-year [5] - The third quarter revenue was 275.57 billion yuan, down 3.94% year-on-year, with a net profit attributable to shareholders of 21.74 billion yuan, down 8.23% year-on-year [5] - The company is focusing on enhancing its "connection + computing power" capabilities, with significant growth in consumer and government enterprise businesses, and continuous breakthroughs in international markets [5] Summary by Sections Financial Performance - For Q3, the gross margin was 40.35%, down 4.28 percentage points year-on-year, and the net profit margin was 7.89%, a decrease of 0.37 percentage points year-on-year [5] - The company expects revenues of 1297.33 billion yuan, 1407.09 billion yuan, and 1537.17 billion yuan for 2024, 2025, and 2026 respectively, with net profits of 96.33 billion yuan, 102.22 billion yuan, and 114 billion yuan for the same years [5][6] Business Segments - The operator network segment is projected to generate revenues of 786.21 billion yuan in 2024, with a gross margin of 49.21% [8] - The terminal segment is expected to see revenues of 320.95 billion yuan in 2024, with a gross margin of 22.50% [8] - The government enterprise business is forecasted to achieve revenues of 190.17 billion yuan in 2024, with a gross margin of 31.94% [8] Valuation - The company is assigned a PE ratio of 20-25 for 2024, leading to a reasonable value range of 40.28 yuan to 50.35 yuan per share [5]