Core Viewpoint - The company reported a decline in revenue for the first half of 2025, but showed significant growth in profit attributable to shareholders, indicating a strategic shift and focus on innovation and core business areas [1][2] Group 1: Financial Performance - The company's revenue for the first half of 2025 was 2.6775 billion RMB, a year-on-year decrease of 24.2% [1] - Profit attributable to shareholders reached 244 million RMB, reflecting a year-on-year increase of 102.5% [1] - Basic earnings per share were 0.13 RMB [1] Group 2: Business Strategy and Development - The company is adjusting its strategic focus, with some innovative business lines still in exploratory stages [1] - The live social business remains a cornerstone, maintaining steady growth through refined operational strategies and technological advancements [1] - The company is enhancing the ecosystem for streamers and guilds, improving product technology and operational barriers to increase user engagement [1] Group 3: Innovation and Market Expansion - The innovative business segment experienced rapid growth, with a focus on enriching the product system and business layout [2] - The short drama business has shown significant improvement in both production capacity and content quality, maintaining a leading market position amid fierce competition [2] - The company is strategically expanding its overseas business, particularly in Southeast Asia and the Middle East, while also exploring emerging markets [2] - The company maintains a positive outlook on WEB3.0 and blockchain development, continuously increasing its cryptocurrency reserves [2] - AI technology is being integrated into business operations to enhance user experience and innovate business models, providing new growth momentum [2]

Core Insights - The company, Yingyu Universe (03700.HK), reported a revenue of RMB 2.678 billion for the first half of 2025, representing a year-on-year decrease of 24.2% [1] - The net profit for the period was RMB 274 million, showing a significant year-on-year increase of 102.8% [1] - Adjusted net profit amounted to RMB 281 million, reflecting a year-on-year growth of 92.0%, with basic earnings per share at RMB 0.13 [1] Revenue Analysis - The decline in revenue is attributed to strategic adjustments and a shift in business focus, with some innovative business lines still in exploratory and early development stages [1]

[Financial Summary](index=1&type=section&id=Financial%20Summary) Revenue declined by 24.2%, but operating and net profits significantly increased, despite decreases in key operating metrics [Key Financial Indicators](index=1&type=section&id=Financial%20Summary-Key%20Financial%20Indicators) During the reporting period, the company's revenue decreased by 24.2% year-on-year, while operating profit and profit for the period significantly increased by 170.2% and 102.8% respectively, with non-IFRS adjusted net profit growing by 92.0% Key Financial Metrics | Metric (RMB thousands) | Six Months Ended June 30, 2025 (Unaudited) | Six Months Ended June 30, 2024 (Unaudited) | Y-o-Y Change (%) | Year Ended December 31, 2024 (Audited) | | :--------------------- | :----------------------------------------- | :----------------------------------------- | :--------------- | :------------------------------------- | | Revenue | 2,677,543 | 3,533,173 | (24.2) | 6,850,721 | | Cost of Sales | (1,400,581) | (1,873,214) | (25.2) | (3,508,024) | | Gross Profit | 1,276,962 | 1,659,959 | (23.1) | 3,342,697 | | Operating Profit | 369,356 | 136,687 | 170.2 | 220,291 | | Profit for the Period/Year | 273,979 | 135,115 | 102.8 | 216,642 | | Non-IFRS Adjusted Net Profit | 281,277 | 146,485 | 92.0 | 234,393 | [Key Operating Data](index=2&type=section&id=Financial%20Summary-Key%20Operating%20Data) During the reporting period, the company's main products saw decreases in Monthly Average Active Users and Monthly Average Revenue Per User by 16.1% and 9.8% year-on-year, respectively Key Operating Metrics | Metric | Six Months Ended June 30, 2025 (Unaudited) | Six Months Ended June 30, 2024 (Unaudited) | Y-o-Y Change (%) | Year Ended December 31, 2024 (Audited) | | :-------------------------- | :----------------------------------------- | :----------------------------------------- | :--------------- | :------------------------------------- | | Monthly Average Active Users (thousands) | 20,185 | 24,045 | (16.1) | 20,836 | | Monthly Average Revenue Per User (RMB) | 22.1 | 24.5 | (9.8) | 27.4 | [Management Discussion and Analysis](index=3&type=section&id=Management%20Discussion%20and%20Analysis) This section covers the group's strategic business review, financial performance, liquidity, human resources, and dividend policy for the reporting period [Business Review and Outlook](index=3&type=section&id=Business%20Review%20and%20Outlook) The Group maintains its long-term strategy, embracing advanced technologies and diversified growth, with live social and innovative businesses evolving, and future plans focusing on AI integration and global expansion [Overall Strategy and Market Environment](index=3&type=section&id=Business%20Review%20and%20Outlook-Overall%20Strategy%20and%20Market%20Environment) In H1 2025, the Group actively responded to market changes, maintaining its long-term strategy, embracing advanced technologies, and exploring diversified growth, particularly in live social and innovative businesses - The Group adheres to its long-term development strategy, actively embracing cutting-edge technological changes and exploring diversified growth paths[5](index=5&type=chunk) - The live social business actively addresses market challenges by deepening platform ecosystem development and integrating AI technology applications[5](index=5&type=chunk) - Innovative business segments achieved rapid development, with short-form drama business maintaining industry leadership and overseas business deepening presence in Southeast Asia while expanding to new regions[5](index=5&type=chunk) - Future plans include continuously deepening AI technology applications, accelerating localized deployment in overseas markets, and focusing on Web3.0 and digital asset development[6](index=6&type=chunk) [Business Review](index=3&type=section&id=Business%20Review%20and%20Outlook-Business%20Review) The Group's live social business remained stable through refined operations and AI integration, while innovative businesses rapidly developed, and the Group remains optimistic about Web3.0 and blockchain [Live Social Business](index=3&type=section&id=Business%20Review%20and%20Outlook-Business%20Review-Live%20Social%20Business) As a cornerstone business, live social maintained stability in a complex market, enhancing user stickiness and interaction through refined operations, ecosystem building, and AI technology integration - Live social business maintains stable development, laying a foundation through refined operations and forward-looking technology deployment[7](index=7&type=chunk) - Continuously deepening the development of streamer and guild ecosystems, enhancing product technology and operational barriers, and increasing user stickiness[7](index=7&type=chunk) - Actively embracing AI technology, exploring its integration with social products, and innovating user interaction experiences[7](index=7&type=chunk) [Innovative Businesses](index=4&type=section&id=Business%20Review%20and%20Outlook-Business%20Review-Innovative%20Businesses) Innovative businesses achieved rapid growth in H1 2025, with short-form drama leading the market and overseas operations expanding through localization, while the Group remains optimistic about Web3.0 and blockchain - Innovative businesses achieved rapid development in the first half, with short-form drama business demonstrating dual improvements in production capacity and content quality, maintaining industry leadership[8](index=8&type=chunk) - Overseas business deepens its presence in core markets like Southeast Asia and the Middle East, while expanding into new markets, enhancing user reputation and commercialization efficiency through localized teams and product iterations[8](index=8&type=chunk) - The Group maintains an optimistic attitude towards the Web3.0 and blockchain industries, holding and continuously expanding its cryptocurrency reserves long-term[8](index=8&type=chunk) - Actively promoting AI technology to empower businesses, exploring user experience enhancement and business model innovation[8](index=8&type=chunk) [Business Outlook](index=4&type=section&id=Business%20Review%20and%20Outlook-Business%20Outlook) The Group plans to foster a healthy live social ecosystem, increase AI investment, deepen overseas market strategies, and proactively explore AI and Web3.0 for long-term growth [Core Business and AI Applications](index=4&type=section&id=Business%20Review%20and%20Outlook-Business%20Outlook-Core%20Business%20and%20AI%20Applications) The Group will focus on building a sustainable live social ecosystem, increasing investment in AI and other cutting-edge technologies to enhance user experience and platform value - Committed to building a long-term healthy and sustainable live social ecosystem, increasing investment in AI and other cutting-edge technologies[9](index=9&type=chunk) - Integrating advantageous resources, improving operational efficiency, and continuously exploring diverse and segmented social entertainment needs of users[9](index=9&type=chunk) - Focusing on the exploration of AI technology applications in live social scenarios, enhancing user experience and platform value through differentiated product positioning and refined user operations[9](index=9&type=chunk) [Overseas Market Expansion](index=4&type=section&id=Business%20Review%20and%20Outlook-Business%20Outlook-Overseas%20Market%20Expansion) The Group will deepen its overseas market strategy through differentiated regional approaches and localized innovation, strengthening operations and brand building while expanding into new markets - Deepening overseas market strategic layout, building a more comprehensive overseas interactive entertainment ecosystem through differentiated regional development strategies and localized innovation[10](index=10&type=chunk) - Strengthening localized operations and brand building, continuously exploring new markets with development potential based on core market experience[10](index=10&type=chunk) - Continuously exploring user needs, optimizing product experience, and exploring cutting-edge technology applications to enhance product competitiveness[10](index=10&type=chunk) [AI and Web3.0 Forward-looking Layout](index=5&type=section&id=Business%20Review%20and%20Outlook-Business%20Outlook-AI%20and%20Web3.0%20Forward-looking%20Layout) The Group actively embraces AI development, exploring its business growth potential, while remaining optimistic about blockchain and cryptocurrency as core anchors for future asset security and global expansion - Actively embracing the rapid development trend of the AI industry, deeply exploring effective paths for AI technology to drive business growth[11](index=11&type=chunk) - Continuously optimistic about the development potential of the blockchain industry and the growth potential of cryptocurrencies, and continuously allocating related assets[11](index=11&type=chunk) - Positioning cryptocurrencies as a core anchor for future asset security, growth, and globalization[11](index=11&type=chunk) [Financial Review](index=5&type=section&id=Financial%20Review) During the period, Group revenue decreased by 24.2%, but operating profit and profit for the period significantly increased, with sales costs declining, gross margin stable, and other net income turning positive [Revenue and Cost](index=5&type=section&id=Financial%20Review-Revenue%20and%20Cost) Group revenue decreased by 24.2% to RMB2,677.5 million, primarily due to strategic adjustments, while cost of sales decreased by 25.2%, and gross profit declined by 23.1% with a stable gross margin of 47.7% Revenue and Cost Metrics | Metric (RMB millions) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Y-o-Y Change (%) | | :-------------------- | :----------------------------- | :----------------------------- | :--------------- | | Revenue | 2,677.5 | 3,533.2 | (24.2) | | Cost of Sales | 1,400.6 | 1,873.2 | (25.2) | | Gross Profit | 1,277.0 | 1,660.0 | (23.1) | | Gross Margin | 47.7% | 47.0% | +0.7pp | - Revenue decrease is primarily due to the Group's strategic and business focus adjustments, with some innovative business lines still in exploration and initial development stages[12](index=12&type=chunk) [Expenses and Profit](index=6&type=section&id=Financial%20Review-Expenses%20and%20Profit) Sales and marketing, administrative, and R&D expenses all decreased, while other net income turned positive due to fair value gains, and profit for the period increased by 102.8% Expense and Profit Metrics | Metric (RMB millions) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Y-o-Y Change (%) | | :-------------------- | :----------------------------- | :----------------------------- | :--------------- | | Sales and Marketing Expenses | 990.2 | 1,289.7 | (23.2) | | Administrative Expenses | 108.6 | 131.5 | (17.5) | | Research and Development Expenses | 82.7 | 99.1 | (16.6) | | Other Net Income/(Loss) | 297.2 (Income) | (18.5) (Loss) | N/A | | Net Finance Income | 16.9 | 20.5 | (17.5) | | Share of Loss of Investments Accounted for Using Equity Method | 51.1 | 1.3 | 3830.8 | | Income Tax Expense | 61.2 | 20.8 | 194.2 | | Profit for the Period | 274.0 | 135.1 | 102.8 | - Other net income significantly turned positive, primarily due to an increase in the fair value of certain financial assets at fair value through profit or loss[18](index=18&type=chunk) - Share of loss of investments accounted for using the equity method significantly increased, primarily due to increased investment losses recognized by associates and joint ventures[20](index=20&type=chunk) [Non-IFRS Measure—Adjusted Net Profit](index=7&type=section&id=Financial%20Review-Non-IFRS%20Measure%E2%80%94Adjusted%20Net%20Profit) The Group uses non-IFRS adjusted net profit, excluding share-based compensation, as a supplementary financial measure, which increased by 92.0% to RMB281.3 million during the period Non-IFRS Adjusted Net Profit Reconciliation | Metric (RMB thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------- | :----------------------------- | :----------------------------- | | Profit for the Period | 273,979 | 135,115 | | Add: Share-based compensation expenses (non-cash) | 7,298 | 11,370 | | Adjusted Net Profit | 281,277 | 146,485 | - Adjusted net profit increased by **92.0%** year-on-year, reflecting improved operating performance after excluding share-based compensation expenses[2](index=2&type=chunk) [Liquidity and Capital Resources](index=8&type=section&id=Liquidity%20and%20Capital%20Resources) The Group funds operations primarily through cash from operating activities, showing improved liquidity and gearing ratios, increased financial assets at fair value, and significant capital expenditure, while managing contingent liabilities and foreign exchange risk [Liquidity and Gearing Ratios](index=8&type=section&id=Liquidity%20and%20Capital%20Resources-Liquidity%20and%20Gearing%20Ratios) As of June 30, 2025, the Group's current ratio improved to 5.9 from 3.7, and the gearing ratio decreased to 0.1 from 0.3, indicating enhanced liquidity and reduced debt levels Liquidity and Gearing Ratios | Metric | June 30, 2025 | December 31, 2024 | Change | | :------------ | :------------ | :---------------- | :------- | | Current Ratio | 5.9 | 3.7 | Increase | | Gearing Ratio | 0.1 | 0.3 | Decrease | - The Group primarily funds its operations through cash generated from operating activities and plans to fund expansion and business operations through internal resources and sustainable growth[24](index=24&type=chunk) [Cash and Cash Equivalents and Restricted Cash](index=8&type=section&id=Liquidity%20and%20Capital%20Resources-Cash%20and%20Cash%20Equivalents%20and%20Restricted%20Cash) As of June 30, 2025, cash and cash equivalents decreased to RMB1,690.2 million, while restricted cash significantly declined to RMB68.9 million, including funds frozen due to regulatory investigations Cash and Restricted Cash | Metric (RMB millions) | June 30, 2025 | December 31, 2024 | Change | | :-------------------- | :------------ | :---------------- | :----------------- | | Cash and Cash Equivalents | 1,690.2 | 2,195.7 | Decrease | | Restricted Cash | 68.9 | 319.6 | Significant Decrease | - Approximately **RMB28.5 million** of restricted cash is related to investigations by local regulatory authorities, resulting in a portion of cash being frozen[26](index=26&type=chunk) [Financial Assets at Fair Value Through Profit or Loss](index=9&type=section&id=Liquidity%20and%20Capital%20Resources-Financial%20Assets%20at%20Fair%20Value%20Through%20Profit%20or%20Loss) As of June 30, 2025, total financial assets at fair value through profit or loss significantly increased to RMB1,566.3 million, primarily comprising investment products and financial instruments with preference rights Financial Assets at Fair Value Through Profit or Loss Breakdown | Financial Asset Category (RMB thousands) | June 30, 2025 | December 31, 2024 | | :--------------------------------------- | :------------ | :---------------- | | **Subtotal Investment Products** | **1,391,230** | **564,849** | | - Listed equity securities | 751,584 | 302,439 | | - Derivative options on listed equity securities | 56,132 | – | | - Funds | 544,514 | 147,410 | | - Others | 39,000 | 115,000 | | **Subtotal Unlisted Preference Shares** | **175,043** | **194,520** | | **Total** | **1,566,273** | **759,369** | - Investment product subscriptions aim to maximize returns on unutilized funds, considering risk levels, investment returns, liquidity, and maturity periods[28](index=28&type=chunk) - Directors believe the investment products' risks are controllable, terms are fair and reasonable, align with the overall interests of the Company and shareholders, and are expected to generate stable income[29](index=29&type=chunk) [Capital Expenditure](index=10&type=section&id=Liquidity%20and%20Capital%20Resources-Capital%20Expenditure) Capital expenditure significantly increased to RMB231.2 million during the period, primarily for equipment, leasehold improvements, and intangible assets, funded by operating cash flow Capital Expenditure | Metric (RMB millions) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Y-o-Y Change (%) | | :-------------------- | :----------------------------- | :----------------------------- | :--------------- | | Capital Expenditure | 231.2 | 69.6 | 232.2 | - Capital expenditure was primarily for the purchase of equipment, leasehold improvements, and intangible assets to support business development[30](index=30&type=chunk) [Contingent Liabilities and Guarantees](index=10&type=section&id=Liquidity%20and%20Capital%20Resources-Contingent%20Liabilities%20and%20Guarantees) As of June 30, 2025, approximately RMB28.5 million in bank deposits were frozen due to regulatory investigations, with management unable to estimate potential financial impact despite believing operations comply with regulations - Approximately **RMB28.5 million** in bank deposits were frozen due to investigations by local regulatory authorities[31](index=31&type=chunk) - Management believes the Group's business operations comply with Chinese regulations and has not received any summons as a defendant, thus having no present obligation[31](index=31&type=chunk) - Due to ongoing investigations and lack of detailed information, the potential financial impact cannot be assessed or estimated, and therefore no provision has been made[31](index=31&type=chunk) [Pledge of Assets](index=10&type=section&id=Liquidity%20and%20Capital%20Resources-Pledge%20of%20Assets) As of June 30, 2025, the Group had not pledged or charged any assets - As of June 30, 2025, the Group had no assets pledged or charged[32](index=32&type=chunk) [Foreign Exchange Risk Management](index=11&type=section&id=Liquidity%20and%20Capital%20Resources-Foreign%20Exchange%20Risk%20Management) The Group manages foreign exchange risk by regularly reviewing net exposure and utilizing natural hedges, potentially entering into forward foreign exchange contracts when necessary - The Group manages foreign exchange risk by regularly reviewing net foreign exchange exposure and using natural hedges where possible[33](index=33&type=chunk) - Forward foreign exchange contracts may be entered into when necessary to mitigate risk[33](index=33&type=chunk) [Employees and Remuneration Policy](index=11&type=section&id=Employees%20and%20Remuneration%20Policy) As of June 30, 2025, the Group had 1,462 full-time employees, with 389 in technology and R&D, and maintains a remuneration policy based on experience, qualifications, and market conditions, alongside talent development programs Employee Headcount | Metric | June 30, 2025 | | :--------------------- | :------------ | | Total Full-time Employees | 1,462 | | Technology and R&D Employees | 389 | - Remuneration policy is based on experience, qualifications, and market conditions, including basic salary, allowances, bonuses, share-based payments, and other benefits[34](index=34&type=chunk) - The Group maintains good labor relations and has established efficient and systematic talent training and development programs to enhance employee skills and professional ethics[34](index=34&type=chunk)[35](index=35&type=chunk) [Interim Dividend](index=11&type=section&id=Interim%20Dividend) The Board of Directors resolved not to declare any interim dividend for the six months ended June 30, 2025 - The Board of Directors resolved not to declare an interim dividend for the first half of 2025[36](index=36&type=chunk) [Interim Condensed Consolidated Financial Statements](index=12&type=section&id=Interim%20Condensed%20Consolidated%20Financial%20Statements) This section presents the interim condensed consolidated financial statements, including the statement of comprehensive income, statement of financial position, and statement of changes in equity [Interim Condensed Consolidated Statement of Comprehensive Income](index=12&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) During the reporting period, the Group recorded revenue of RMB2,677,543 thousand, profit for the period of RMB273,979 thousand, with basic and diluted earnings per share both at RMB0.13 Consolidated Statement of Comprehensive Income | Metric (RMB thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------- | :----------------------------- | :----------------------------- | | Revenue | 2,677,543 | 3,533,173 | | Gross Profit | 1,276,962 | 1,659,959 | | Operating Profit | 369,356 | 136,687 | | Profit for the Period | 273,979 | 135,115 | | Profit Attributable to Owners of the Company | 244,269 | 120,599 | | Total Comprehensive Income for the Period (Net of Tax) | 266,837 | 140,944 | | Basic Earnings Per Share (RMB) | 0.13 | 0.06 | | Diluted Earnings Per Share (RMB) | 0.13 | 0.06 | [Interim Condensed Consolidated Statement of Financial Position](index=14&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's total assets were RMB5,424,739 thousand, total equity RMB4,718,392 thousand, and total liabilities RMB706,347 thousand, with significant increases in intangible assets and financial assets at fair value through profit or loss Consolidated Statement of Financial Position | Metric (RMB thousands) | June 30, 2025 | December 31, 2024 | | :--------------------- | :------------ | :---------------- | | Total Assets | 5,424,739 | 5,572,333 | | Total Non-current Assets | 1,575,564 | 1,607,414 | | Total Current Assets | 3,849,175 | 3,964,919 | | Total Equity | 4,718,392 | 4,446,266 | | Total Liabilities | 706,347 | 1,126,067 | | Total Non-current Liabilities | 52,081 | 47,362 | | Total Current Liabilities | 654,266 | 1,078,705 | - Intangible assets increased from **RMB214,243 thousand** at the end of 2024 to **RMB387,111 thousand**[41](index=41&type=chunk) - Current financial assets at fair value through profit or loss increased from **RMB564,849 thousand** at the end of 2024 to **RMB1,391,230 thousand**[41](index=41&type=chunk) [Interim Condensed Consolidated Statement of Changes in Equity](index=16&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) As of June 30, 2025, total equity attributable to owners of the Company was RMB4,642,433 thousand, with non-controlling interests of RMB75,959 thousand, and total comprehensive income for the period of RMB266,837 thousand Consolidated Statement of Changes in Equity | Metric (RMB thousands) | June 30, 2025 (Unaudited) | January 1, 2024 (Balance) | | :--------------------- | :------------------------ | :------------------------ | | Subtotal Equity Attributable to Owners of the Company | 4,642,433 | 4,266,133 | | Non-controlling Interests | 75,959 | 15,710 | | Total | 4,718,392 | 4,281,843 | | Total Comprehensive Income for the Period | 266,837 | 140,944 (June 30, 2024) | - Accumulated profits increased from **RMB231,304 thousand** as of January 1, 2024, to **RMB655,885 thousand** as of June 30, 2025[43](index=43&type=chunk) [Notes to the Interim Condensed Consolidated Financial Information](index=17&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information) This section provides detailed notes on the basis of preparation, accounting policy changes, estimates, revenue breakdown, expense details, income tax, earnings per share, dividends, and trade receivables and payables [General Information](index=17&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information-General%20Information) Inkeverse Group Company Limited primarily engages in value-added services and entertainment content in China, is registered in the Cayman Islands, listed on the HKEX, and presents financial information in RMB - Inkeverse Group primarily engages in value-added services and entertainment content services in China[44](index=44&type=chunk) - The Company's shares are listed on the Main Board of The Stock Exchange of Hong Kong, and financial information is presented in RMB[45](index=45&type=chunk)[46](index=46&type=chunk) [Basis of Preparation of Financial Information](index=17&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information-Basis%20of%20Preparation%20of%20Financial%20Information) The interim condensed consolidated financial information is prepared in accordance with IAS 34 "Interim Financial Reporting" and should be read in conjunction with the annual consolidated financial statements - The financial information is prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting"[47](index=47&type=chunk) - It should be read in conjunction with the Company's annual report for the year ended December 31, 2024[47](index=47&type=chunk) [Changes in Accounting Policies](index=17&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information-Changes%20in%20Accounting%20Policies) Adopted accounting policies are consistent with the prior fiscal year, except for income tax estimates and new/amended standards, with no significant impact expected from newly issued but unadopted standards - Accounting policies are consistent with the prior fiscal year, except for income tax estimates and the adoption of new and amended standards[48](index=48&type=chunk) - The Group is not required to change accounting policies or make retrospective adjustments due to the adoption of new and amended standards[50](index=50&type=chunk) - Newly issued but not yet adopted standards are not expected to have a significant impact on future reporting periods[51](index=51&type=chunk) [Estimates](index=18&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information-Estimates) The preparation of interim condensed consolidated financial information involves management judgments, estimates, and assumptions, with significant uncertainties consistent with the 2024 annual consolidated financial statements - Financial information preparation involves management judgments, estimates, and assumptions, and actual results may differ from these estimates[52](index=52&type=chunk) - The significant judgments and sources of estimation uncertainty made by management in preparing this financial information are consistent with those in the 2024 annual consolidated financial statements[52](index=52&type=chunk) [Revenue Breakdown](index=18&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information-Revenue%20Breakdown) During the reporting period, the Group's revenue primarily derived from value-added services and entertainment content services, with value-added services being the largest component but showing a year-on-year decrease Revenue by Category | Revenue Category (RMB thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------- | :----------------------------- | :----------------------------- | | Value-added Services | 2,034,496 | 2,601,174 | | Entertainment Content Services | 590,364 | 642,749 | | Others | 52,683 | 289,250 | | **Total Revenue** | **2,677,543** | **3,533,173** | Revenue Recognition Timing | Revenue Recognition Timing (RMB thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------------- | :----------------------------- | :----------------------------- | | Revenue recognized at a point in time | 2,576,513 | 3,419,944 | | Revenue recognized over a period of time | 101,030 | 113,229 | | **Total Revenue** | **2,677,543** | **3,533,173** | [Expense Details](index=19&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information-Expense%20Details) Key expenses include streamer sharing, promotion and advertising, and employee benefits, with streamer sharing and advertising expenses decreasing, and expected credit loss provisions shifting from reversal to provision Expense Breakdown | Expense Category (RMB thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------- | :----------------------------- | :----------------------------- | | Streamer Sharing | 1,120,427 | 1,458,817 | | Promotion and Advertising Expenses | 966,576 | 1,259,338 | | Employee Benefit Expenses | 246,080 | 296,385 | | Payment Handling Fees | 55,558 | 61,007 | | Amortization of Intangible Assets | 52,852 | 61,599 | | Technical Support and Professional Service Fees | 45,306 | 39,710 | | Bandwidth and Server Hosting Fees | 36,216 | 50,170 | | Expected Credit Loss Provision/(Reversal) | 30,504 | (1,574) | | Cost of Goods Sold | 2,004 | 97,004 | | **Total Expenses** | **2,612,519** | **3,392,063** | - Expected credit loss provision shifted from a reversal in the same period of 2024 to a provision in the first half of 2025[56](index=56&type=chunk) - Cost of goods sold significantly decreased from **RMB97,004 thousand** to **RMB2,004 thousand**[56](index=56&type=chunk) [Income Tax Expense](index=19&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information-Income%20Tax%20Expense) Income tax expense significantly increased by 194.2% to RMB61,229 thousand during the period, primarily due to higher current income tax expense and deferred tax shifting from credit to expense Income Tax Breakdown | Income Tax Category (RMB thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :----------------------------- | :----------------------------- | | Current Income Tax Expense | (52,163) | (23,035) | | Deferred Tax (Expense)/Credit | (9,066) | 2,221 | | **Income Tax Expense** | **(61,229)** | **(20,814)** | - Income tax expense increased by **194.2%** year-on-year, primarily due to an increase in profit before tax[21](index=21&type=chunk)[57](index=57&type=chunk) [Earnings Per Share](index=20&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information-Earnings%20Per%20Share) Basic and diluted earnings per share attributable to owners of the Company both significantly increased to RMB0.13 during the reporting period, up from RMB0.06 in the prior period Earnings Per Share | Metric (RMB) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------- | :----------------------------- | :----------------------------- | | Basic Earnings Per Share | 0.13 | 0.06 | | Diluted Earnings Per Share | 0.13 | 0.06 | - Basic and diluted earnings per share both significantly increased, reflecting improved company profitability[59](index=59&type=chunk)[60](index=60&type=chunk) [Dividends](index=20&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information-Dividends) The Board of Directors resolved not to declare any interim dividend for the six months ended June 30, 2025 - The Board of Directors resolved not to declare an interim dividend for the first half of 2025[59](index=59&type=chunk) [Trade Receivables](index=21&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information-Trade%20Receivables) As of June 30, 2025, total trade receivables increased to RMB167,320 thousand, with the majority of receivables aged within three months Trade Receivables Aging Analysis | Aging (RMB thousands) | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Up to 3 months | 162,363 | 143,716 | | 3 to 6 months | 9,493 | 6,325 | | 6 months to 1 year | 1,412 | 1,125 | | Over 1 year | 579 | 1,528 | | Less: Impairment Provision | (6,527) | (4,580) | | **Total** | **167,320** | **148,114** | - The carrying amount of trade receivables is primarily denominated in RMB and approximates fair value[61](index=61&type=chunk) [Trade Payables and Bills Payable](index=21&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information-Trade%20Payables%20and%20Bills%20Payable) As of June 30, 2025, total trade payables and bills payable significantly decreased to RMB459,915 thousand, with the largest portion of trade payables aged within three months Trade Payables and Bills Payable | Category (RMB thousands) | June 30, 2025 | December 31, 2024 | | :----------------------- | :------------ | :---------------- | | Trade Payables | 419,587 | 459,269 | | Bills Payable | 40,328 | 286,095 | | **Total** | **459,915** | **745,364** | Trade Payables Aging Analysis | Trade Payables Aging (RMB thousands) | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :------------ | :---------------- | | Up to 3 months | 243,668 | 310,103 | | 3 to 6 months | 26,509 | 17,538 | | 6 months to 1 year | 17,803 | 11,169 | | Over 1 year | 131,607 | 120,459 | | **Total** | **419,587** | **459,269** | [Other Information](index=22&type=section&id=Other%20Information) This section covers information on the purchase, sale, or redemption of listed securities, events after the reporting period, compliance with corporate governance codes, and the audit committee's review [Purchase, Sale or Redemption of the Company's Listed Securities](index=22&type=section&id=Other%20Information-Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company%27s%20Listed%20Securities) During the reporting period, neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - During the reporting period, neither the Company nor its subsidiaries purchased, sold, or redeemed any listed securities[64](index=64&type=chunk) [Events After the Reporting Period](index=21&type=section&id=Events%20After%20the%20Reporting%20Period) On August 20, 2025, Beijing Milaiwu Network Technology Co., Ltd., a subsidiary, signed an agreement to purchase 9,950,617 Series A preferred shares of Skywork AI Inc. for RMB100 million, with the transaction yet to be completed - On August 20, 2025, Beijing Milaiwu Network Technology Co., Ltd., a subsidiary of the Company, signed a share purchase agreement with Skywork AI Inc[63](index=63&type=chunk)[65](index=65&type=chunk) - Beijing Milaiwu will purchase **9,950,617 Series A preferred shares** of Skywork AI Inc. for **RMB100 million**[63](index=63&type=chunk)[65](index=65&type=chunk) - As of the date of this interim results announcement, the transaction has not yet been completed[65](index=65&type=chunk) [Compliance with Corporate Governance Code](index=22&type=section&id=Compliance%20with%20Corporate%20Governance%20Code) The Company has adopted and complied with the Corporate Governance Code, with a deviation from C.2.1 regarding the combined roles of Chairman and CEO, which the Board believes benefits Group management - The Company has adopted and complied with all applicable code provisions of the Corporate Governance Code[66](index=66&type=chunk) - There is a deviation from Code Provision C.2.1 of the Corporate Governance Code, where Mr. Feng Yousheng serves as both Chairman and Chief Executive Officer[66](index=66&type=chunk)[67](index=67&type=chunk) - The Board believes this combined role benefits Group management, with senior management and the Board ensuring a balance of power and authority[67](index=67&type=chunk) [Compliance with the Model Code for Securities Transactions by Directors](index=23&type=section&id=Compliance%20with%20the%20Model%20Code%20for%20Securities%20Transactions%20by%20Directors) The Company has adopted and confirmed compliance with the Model Code for Securities Transactions by Directors as set out in Appendix C3 of the Listing Rules during the reporting period - The Company has adopted and complied with the Model Code for Securities Transactions by Directors[68](index=68&type=chunk) [Audit Committee](index=23&type=section&id=Audit%20Committee) The Audit Committee, comprising three independent non-executive directors with Mr. Cui Dawei as Chairman, reviewed the interim results, confirming compliance with accounting principles and disclosure requirements, with the financial information reviewed but not audited - The Audit Committee comprises three independent non-executive directors, with Mr. Cui Dawei serving as Chairman[69](index=69&type=chunk) - The Committee has reviewed and discussed the Group's interim results, confirming compliance with applicable accounting principles, standards, and disclosure requirements[69](index=69&type=chunk) - The interim condensed consolidated financial information is unaudited but has been reviewed by the auditor in accordance with International Standard on Review Engagements 2410[69](index=69&type=chunk) [Publication of Interim Results and Interim Report](index=23&type=section&id=Publication%20of%20Interim%20Results%20and%20Interim%20Report) This interim results announcement is published on the HKEX and Company websites, and the interim report will be dispatched to shareholders and published concurrently - This interim results announcement has been published on the website of The Stock Exchange of Hong Kong (www.hkexnews.hk) and the Company's website (www.inkeverse.com)[71](index=71&type=chunk) - The interim report will be dispatched to shareholders in due course and published concurrently on the HKEX and Company websites[71](index=71&type=chunk)

Core Insights - The establishment of the "Hong Kong Digital Asset Listed Companies Association" marks a significant step in promoting digital assets in Hong Kong, with participation from over 80 listed companies and financial institutions [1][2] - The Hong Kong government is committed to fostering innovation in financial technology, with over 1,100 fintech companies operating in the region and a 15% annual growth rate [1][2] Group 1: Government Initiatives - The Hong Kong government plans to regularize the issuance of green bonds and explore tokenization applications in various sectors, including renewable energy [2] - A funding program has been launched to support projects with commercial potential, offering up to HKD 500,000 for tokenization certification and commercialization [2] Group 2: Participating Companies - A list of participating companies includes notable H-shares such as Guofu Quantum, China New Economy Investment, and Huya Capital, among others [3] - A-share participants include Zhaoxin Co. and Jingbeifang, while US-listed companies include Galaxy Digital and Amber [4]

Core Viewpoint - The company, Ying Universe (03700), has experienced a significant stock price increase of over 7% following the announcement of a positive earnings forecast, projecting a net profit of no less than RMB 260 million for the six months ending June 30, 2025, representing a growth of over 90% compared to the same period last year [1][1][1] Financial Performance - The anticipated profit growth is primarily attributed to changes in the fair value of financial instruments recognized in profit or loss during the reporting period [1][1][1] Strategic Developments - Ying Universe has entered into a Series A preferred stock purchase agreement with Skywork AI, acquiring approximately 9.95 million shares for a total consideration of RMB 100 million, which represents about 0.67% of Skywork AI's expanded share capital [1][1][1] - Skywork AI, a subsidiary of Kunlun Group Limited, focuses on investments in general artificial intelligence and AI-generated content, having launched various AI-native products globally, including AI search, short dramas, games, music, and social platforms [1][1][1] - The board believes that this transaction will enhance collaboration with Skywork AI in the field of AI large model technology and is significant for the implementation of the company's strategic objectives [1][1][1]

Group 1 - The core viewpoint of the article is that Yingyuzhou (03700) has experienced a significant stock price increase of over 7% following the announcement of a positive earnings forecast, expecting a net profit of no less than RMB 260 million for the six months ending June 30, 2025, representing a growth of over 90% compared to the same period last year [1][1][1] - The primary reason for the expected profit increase is attributed to the fair value changes of financial instruments recognized in profit or loss during the reporting period [1][1][1] Group 2 - Yingyuzhou has entered into a Series A preferred stock purchase agreement with Skywork AI, acquiring approximately 9.95 million shares for a total consideration of RMB 100 million, which represents about 0.67% of Skywork AI's expanded share capital [1][1][1] - Skywork AI, a subsidiary of Kunlun Group Limited, is engaged in investments related to general artificial intelligence and AI-generated content, having launched several AI-native products globally, including AI search, short dramas, games, music, and social platforms [1][1][1] - The board believes that this transaction will enhance cooperation with Skywork AI in the field of AI large model technology and is significant for the implementation of the company's strategic objectives [1][1][1]

Core Viewpoint - The transaction between Yingyu Universe and Skywork AI highlights the strategic importance of artificial intelligence technology in reshaping various sectors such as social media, entertainment, and Web 3.0 [1] Group 1: Transaction Details - Yingyu Universe's indirect control over Beijing Milaiwu is purchasing approximately 0.67% of Series A preferred shares from Skywork AI for a price of 100 million RMB [1] - The investment aims to strengthen collaboration in the field of large AI model technology [1] Group 2: Company Overview - Skywork AI operates in the artificial intelligence model sector, covering text, voice, image, video, and music with a comprehensive multimodal layout [1] - The company possesses self-developed technological advantages and has launched several AI-native products, demonstrating rapid commercialization progress [1] Group 3: Strategic Implications - Yingyu Universe believes that AI technology will significantly transform social, entertainment, and Web 3.0 sectors [1] - The transaction is seen as a crucial step in implementing the group's strategic objectives, particularly in enhancing global presence and product commercialization experience [1]

Group 1: Hong Kong Stock Exchange Developments - Hong Kong Stock Exchange (HKEX) CEO Charles Li stated that HKEX will research a 24-hour trading mechanism, taking into account international experiences and local market conditions [1] - HKEX plans to enhance its competitiveness through strategic investments in data platform optimization and trading settlement system upgrades [1] - The exchange is also exploring shortening the settlement cycle for the cash market, with a potential T+1 settlement system supported by its technology by the end of this year [1] Group 2: Market Overview - The S&P 500 index fell for four consecutive days, with the index closing down 0.24% at 6395.78 points [2] - Major technology stocks mostly declined, with Intel dropping approximately 7% [2] - The Nasdaq China Golden Dragon Index rose by 0.33%, with notable gains from Tiger Brokers and JinkoSolar [2] Group 3: Financial Regulatory Updates - The National Financial Regulatory Administration is seeking public opinion on the draft of the "Commercial Bank M&A Loan Management Measures," which includes provisions for equity acquisition loans [3] Group 4: Federal Reserve Insights - The Federal Reserve's July meeting minutes indicated a moderate GDP growth in the first half of the year, with a focus on inflation risks over labor market concerns [4] - There was a notable dissent among Fed officials regarding interest rate decisions, marking a significant moment since 1993 [4] Group 5: Corporate Earnings Reports - Alibaba Group announced plans to spin off its subsidiary, Zhaima, for an independent listing on the Hong Kong Stock Exchange [5] - Baidu Group reported a total revenue of RMB 327.13 billion for Q2 2025, a year-on-year decrease of 4%, while net profit increased by 33% to RMB 73.22 billion [8] - Huazhu Group's total revenue for Q2 2025 was RMB 64.26 billion, with a net profit of RMB 15.44 billion, reflecting a 44.7% year-on-year increase [9] - China Oriental Group expects a net profit increase of no less than 70% for the first half of 2025, projecting at least RMB 2.20 billion [10] - Lijun Pharmaceutical reported a net profit of RMB 12.81 billion for the first half of 2025, a 9.4% increase year-on-year [11] - BOSS Zhipin reported a net profit of RMB 7.16 billion for Q2 2025, a 69.87% increase year-on-year [12] - New World Development reported a significant increase in net profit to HKD 887 million, a 1076% rise year-on-year [13] - Yimuyou Group expects a net profit of no less than RMB 2.6 billion for the first half of 2025, representing a growth of over 90% [14] - Yongsheng Medical reported a net profit of HKD 51.63 million, a 55.1% increase year-on-year [15] - Lepu Biopharma achieved a revenue increase of 249.59% for the first half of 2025, marking its first profit [16] - Huya Technology expects a net profit of USD 30 million to 38 million for the first half of 2025, a significant increase from the previous year [17] - Kingsoft reported a net profit of RMB 816 million for the first half of 2025, a 20.41% increase year-on-year [18] - Zhong An Online reported a net profit of RMB 668 million, a 1103.54% increase year-on-year [19] - Yaoshi Bang reported a net profit of RMB 78.12 million, a 258% increase year-on-year [20] - Crystal International reported a net profit of USD 98.27 million, a 17% increase year-on-year [21] - Ocean Group expects a turnaround with a projected net profit of RMB 9.5 billion to 11 billion for the first half of 2025 [22] - Kingsoft Cloud reported an adjusted EBITDA of approximately RMB 725 million, a 672.62% increase year-on-year [23] Group 6: Pharmaceutical Developments - Heyou Pharmaceutical's IND application for a combination therapy for NSCLC has been approved by the CDE [24] - Shengbela reported a net profit of RMB 327 million, marking a turnaround from a previous loss, with significant growth in various business segments [25]

Group 1 - The core announcement involves a conditional agreement between Beijing Milaiwu and Skywork AI for the purchase of Series A preferred shares, with a total consideration of RMB 100 million for 9.9506 million shares, representing approximately 0.67% of Skywork AI's expanded issued share capital [1] - Skywork AI is recognized as one of the few companies globally that has independently developed and achieved a full-modal layout in the field of artificial intelligence models, covering text, speech, image, video, and music [1] - The company has rapidly commercialized several AI-native products aimed at global consumers, including AI search, short dramas, games, music, and social platforms [1] Group 2 - The group continues to focus on exploring opportunities in social, entertainment, artificial intelligence, and Web 3.0 sectors, believing that AI technology is reshaping the way work is conducted, product forms, business structures, and organizational boundaries [2] - The board believes that leveraging Skywork AI's extensive experience in globalization and commercialization of AI products will strengthen collaboration in the field of large AI model technology and is significant for the implementation of the group's strategy [2]

Group 1 - The core announcement involves a conditional agreement between Beijing Milaiwu and Skywork AI for the purchase of Series A preferred shares, with a total consideration of RMB 100 million for 9.9506 million shares, representing approximately 0.67% of Skywork AI's expanded issued share capital [1] - Skywork AI is recognized as one of the few companies globally that has independently developed and achieved a full-modal layout in the field of artificial intelligence models, covering text, speech, image, video, and music [1] - The company has rapidly commercialized several AI-native products aimed at global consumers, including AI search, short dramas, games, music, and social platforms [1] Group 2 - The group continues to focus on exploring opportunities in social, entertainment, artificial intelligence, and Web 3.0 sectors, believing that AI technology is reshaping the way work is conducted, product forms, business structures, and organizational boundaries [2] - The board believes that leveraging Skywork AI's extensive experience in globalization and commercialization of AI products will strengthen collaboration in the field of large AI model technology and is significant for the implementation of the group's strategy [2]