Core Viewpoint - The company reported a net profit attributable to shareholders of 37.395 million yuan, representing a year-on-year increase of 33.51%, despite a decrease in revenue [1] Financial Performance - The company achieved revenue of 726 million yuan, a year-on-year decrease of 13.12% [1] - Basic earnings per share were reported at 3.05 cents [1] Revenue Breakdown - The decline in revenue was primarily due to a 30.6% decrease in income from self-developed mobile games, which was impacted by adjustments in commercialization strategies affecting players' willingness to pay in the short term [1]

Core Points - The company, Home Town Interactive (03798), reported a revenue of 726 million, representing a year-on-year decrease of 13.12% [1] - The profit attributable to the owners of the company was 37.395 million, showing a year-on-year increase of 33.51% [1] - Basic earnings per share were 3.05 cents [1] Revenue Analysis - The decline in revenue was primarily due to a 30.6% year-on-year decrease in income from self-developed mobile games [1] - The decrease in mobile game revenue was influenced by adjustments in commercialization strategies, which temporarily affected some players' willingness to pay [1]

[Interim Results Announcement](index=1&type=section&id=%E4%B8%AD%E6%9C%9F%E6%A5%AD%E7%B8%BE%E5%85%AC%E5%91%8A) [Financial Highlights](index=1&type=section&id=%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) The company reported a 13.1% decrease in revenue and a 22.9% decrease in gross profit, but a significant 58.8% increase in profit for the period and a 78.3% increase in non-IFRS adjusted net profit for the six months ended June 30, 2025 Financial Highlights for the Six Months Ended June 30, 2025 | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 726,044 | 835,659 | (13.1) | | Gross Profit | 318,352 | 412,968 | (22.9) | | Profit for the Period | 53,469 | 33,670 | 58.8 | | Non-IFRS Adjusted Net Profit Attributable to Owners of the Company | 74,902 | 42,002 | Not Applicable | - Non-IFRS adjusted net profit is primarily adjusted for share-based payment expenses, share of losses (profits) of associates and joint ventures, and impairment losses recognized on loan receivables under the expected credit loss model[3](index=3&type=chunk) [Revenue by Virtual Product Type](index=2&type=section&id=%E6%8C%89%E8%99%9B%E6%93%AC%E7%94%A2%E5%93%81%E9%A1%9E%E5%9E%8B%E5%8A%83%E5%88%86%E7%9A%84%E6%94%B6%E7%9B%8A) For the six months ended June 30, 2025, revenue from self-developed mobile games decreased by 30.6%, while third-party mobile game revenue surged by 123.4% and advertising revenue grew by 21.6%, resulting in an overall revenue decline of 13.1% Revenue by Virtual Product Type (For the Six Months Ended June 30) | Revenue Source | 2025 (RMB thousand) | % of Total Revenue | 2024 (RMB thousand) | % of Total Revenue | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Self-developed Mobile Games | 505,256 | 69.6 | 727,599 | 87.1 | (30.6) | | Third-party Mobile Games | 196,141 | 27.0 | 87,799 | 10.5 | 123.4 | | **Total Mobile Game Revenue** | **701,397** | **96.6** | **815,398** | **97.6** | **(14.0)** | | Advertising Revenue | 24,647 | 3.4 | 20,261 | 2.4 | 21.6 | | **Total** | **726,044** | **100.0** | **835,659** | **100.0** | **(13.1)** | - For the six months ended June 30, 2024, RMB34.2 million of revenue from self-developed mobile games was reclassified to third-party mobile game revenue to better reflect the Group's current situation[5](index=5&type=chunk) [Operating Highlights](index=3&type=section&id=%E7%B6%93%E7%87%9F%E6%91%98%E8%A6%81) As of June 30, 2025, Daily Active Users (DAUs) and average Monthly Active Users (MAUs) remained stable year-on-year, but the number of paying users significantly decreased, reflecting the short-term impact of commercialization strategy adjustments on light users' willingness to pay Key Operating Data (As of June 30) | Indicator | As of or For the Six Months Ended June 30, 2025 | As of or For the Six Months Ended June 30, 2024 | As of or For the Year Ended December 31, 2024 | | :--- | :--- | :--- | :--- | | Daily Active Users (DAUs) | 12,306,675 | 13,360,659 | 13,377,495 | | Paying Users | 9,089,428 | 15,691,516 | 17,756,141 | | Average Monthly Active Users (MAUs) | 59,781,933 | 65,697,381 | 64,342,667 | - DAUs refer to the number of daily active users on the last calendar day of any given period[8](index=8&type=chunk) - Paying users refer to players who have paid at least once to play the Company's mobile game products or purchased virtual tokens offered by the Company in its mobile game products during any given period[8](index=8&type=chunk) [Business Overview and Outlook](index=4&type=section&id=%E6%A5%AD%E5%8B%99%E6%A6%82%E8%A7%88%E5%8F%8A%E5%B1%95%E6%9C%9B) During the reporting period, the Group continued to focus on advantageous segments, achieving significant growth in third-party co-operated game revenue and effective marketing cost control through product content iteration, commercialization model optimization, and refined operations, with future plans to deepen AI technology application, expand user base, strengthen product reserves, and broaden strategic alliances [Business Review](index=4&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) - Launched new seasonal mechanisms and themed visual versions, such as "Weile Fishing Thousand Cannons Edition" deeply integrating the Eastern fantasy theme of Shan Hai Jing[9](index=9&type=chunk) - "Weile Dou Dizhu" and "Weile Sichuan Mahjong" successfully launched on Douyin channel, consistently ranking among the top of Douyin's chess and card popularity list, achieving cross-platform user and brand growth[9](index=9&type=chunk) - Revenue from self-developed mobile games decreased year-on-year, primarily due to commercialization adjustments affecting the payment willingness of some light users[10](index=10&type=chunk) - Third-party mobile game revenue significantly increased by **123.4% to RMB196 million**[10](index=10&type=chunk) - Selling and marketing expenses decreased by **50.8% year-on-year to RMB128.6 million**[12](index=12&type=chunk) - Profit for the period increased by **58.8% year-on-year to RMB53.47 million**; adjusted net profit was **RMB74.9 million**, indicating an overall improvement in profitability[12](index=12&type=chunk) - Accelerated overseas expansion, with overseas fishing products receiving enthusiastic user response in markets such as Vietnam, Hong Kong, Macau, Taiwan, and Indonesia, and multiple products expected to be launched globally within 2025[13](index=13&type=chunk) - Multi-modal AI intelligent agent has entered comprehensive internal testing and multi-business adaptation stages, initially achieving automated empowerment in key aspects such as user portrait analysis, intelligent customer service, and video content distribution[14](index=14&type=chunk) [Strategies for H2 2025](index=6&type=section&id=%E4%BA%8C%E9%9B%B6%E4%BA%94%E4%BA%94%E5%B9%B4%E4%B8%8B%E5%8D%8A%E5%B9%B4%E7%AD%96%E7%95%A5) - Deepen cutting-edge technology, self-develop multi-modal AI intelligent agents, and promote their integration into various business segments, accelerating the AI transformation of the entire R&D and operation process[15](index=15&type=chunk) - Penetrate regional markets, precisely meet localized entertainment demands in domestic second and third-tier markets and regions with lower user penetration rates, and formulate differentiated marketing strategies to expand the user base[16](index=16&type=chunk) - Strengthen product reserves, advance testing and launch of multiple reserve projects, accelerate the launch of overseas products, and build diversified revenue growth engines[17](index=17&type=chunk) - Expand strategic alliances, actively explore new business opportunities through incubation, investment, and acquisition[18](index=18&type=chunk) [Management Discussion and Analysis](index=7&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%A4%E8%A8%8E%E8%AB%96%E8%88%87%E5%88%86%E6%9E%90) Management discussed the financial performance and operating strategies for the reporting period, noting that revenue decline was mainly due to reduced self-developed game income, offset by significant growth in third-party games and advertising revenue, while effective cost control, particularly in selling and marketing and R&D expenses, drove substantial increases in profit for the period and adjusted net profit, with the company maintaining ample liquidity, no significant debt, and continued investment in AI technology and overseas market expansion [Financial Review](index=7&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) [Revenue](index=7&type=section&id=%E6%94%B6%E7%9B%8A) - Revenue primarily comprises income from virtual token sales for self-developed mobile games, third-party mobile games, and advertising[19](index=19&type=chunk) - For the six months ended June 30, 2025, total revenue was approximately **RMB726.0 million**, a **13.1% decrease** from approximately RMB835.7 million in the same period of 2024[20](index=20&type=chunk) - The decrease in revenue was mainly due to a **30.6% year-on-year decline** in self-developed mobile game revenue, affected by commercialization strategy adjustments impacting player payment willingness[20](index=20&type=chunk) Revenue Composition (For the Six Months Ended June 30) | Revenue Source | 2025 % Share | 2024 % Share | | :--- | :--- | :--- | | Sale of Virtual Tokens (Self-developed) | 69.6 | 87.1 | | Distribution of Third-party Mobile Games | 27.0 | 10.5 | | Advertising | 3.4 | 2.4 | [Cost of Sales and Gross Profit](index=7&type=section&id=%E9%8A%B7%E5%94%AE%E6%88%90%E6%9C%AC%E5%8F%8A%E6%AF%9B%E5%88%A9) - Cost of sales decreased by **3.5%** from approximately RMB422.7 million in the same period of 2024 to approximately **RMB407.7 million** in the same period of 2025, primarily due to reduced revenue from self-developed mobile games[21](index=21&type=chunk) - Gross profit decreased by **22.9%** from approximately RMB413.0 million in the same period of 2024 to approximately **RMB318.4 million** in the same period of 2025[22](index=22&type=chunk) - Gross profit margin decreased from **49.4%** in the same period of 2024 to **43.8%** in the same period of 2025, mainly due to increased new media costs and amortization of intangible assets[22](index=22&type=chunk) [Other Income, Gains and Losses](index=8&type=section&id=%E5%85%B6%E4%BB%96%E6%94%B6%E5%85%A5%E3%80%81%E6%94%B6%E7%9B%8A%E5%8F%8A%E虧%E6%90%8D) - Other income decreased by **46.0%** from approximately RMB20.2 million in the same period of 2024 to approximately **RMB13.8 million** in the same period of 2025, primarily due to a decrease in interest income[23](index=23&type=chunk) - Other gains and losses changed from a gain of approximately RMB15.7 million in the same period of 2024 to a loss of approximately **RMB3.3 million** in the same period of 2025, a decrease of RMB18.9 million, mainly due to a loss of RMB10.4 million from derecognition of receivables upon disposal of an associate[24](index=24&type=chunk) [Net Exchange Loss](index=8&type=section&id=%E5%BD%99%E5%85%8C%E虧%E6%90%8D%E6%B7%A8%E9%A1%8D) - A net exchange loss of approximately **RMB2.2 million** was recorded for the six months ended June 30, 2025, compared to a net exchange loss of approximately RMB0.7 million in the same period of 2024, primarily due to fluctuations in the USD exchange rate[25](index=25&type=chunk) [Selling and Marketing Expenses](index=8&type=section&id=%E9%8A%B7%E5%94%AE%E5%8F%8A%E7%87%9F%E9%8A%B7%E9%96%8B%E6%94%AF) - Selling and marketing expenses decreased by **50.8%** from approximately RMB261.1 million in the same period of 2024 to approximately **RMB128.6 million** in the same period of 2025, primarily due to a sharp reduction in promotion and advertising expenses[26](index=26&type=chunk) [Administrative and Other Expenses](index=8&type=section&id=%E8%A1%8C%E6%94%BF%E5%8F%8A%E5%85%B6%E4%BB%96%E9%96%8B%E6%94%AF) - Administrative and other expenses decreased by **17.6%** from approximately RMB66.6 million in the same period of 2024 to approximately **RMB60.4 million** in the same period of 2025, primarily due to a decrease in professional service fees[27](index=27&type=chunk) [Research and Development Expenses](index=9&type=section&id=%E7%A0%94%E7%99%BC%E6%94%AF%E5%87%BA) - Research and development expenses decreased by **38.5%** from approximately RMB57.3 million in the same period of 2024 to approximately **RMB35.2 million** in the same period of 2025, primarily due to a decrease in R&D staff remuneration expenses[28](index=28&type=chunk) [Profit Before Income Tax](index=9&type=section&id=%E9%99%A4%E6%89%80%E5%BE%97%E7%A8%85%E5%89%8D%E6%BA%A2%E5%88%A9) - Profit before income tax increased by **55.6%** from approximately RMB40.3 million in the same period of 2024 to approximately **RMB62.8 million** in the same period of 2025[29](index=29&type=chunk) - The percentage of profit before income tax to total revenue increased from **4.8%** in the same period of 2024 to **8.6%** in the same period of 2025, primarily due to reduced selling and marketing expenses and R&D expenses[29](index=29&type=chunk) [Income Tax Expense](index=9&type=section&id=%E6%89%80%E5%BE%97%E7%A8%85%E9%96%8B%E6%94%AF) - Income tax expense increased by **39.7%** from RMB6.7 million in the same period of 2024 to **RMB9.3 million** in the same period of 2025[30](index=30&type=chunk) - The effective tax rate decreased from **16.5%** in the same period of 2024 to **14.8%** in the same period of 2025, with the increase in income tax expense attributed to higher profit before tax[30](index=30&type=chunk) [Profit Attributable to Owners of the Company](index=9&type=section&id=%E6%9C%AC%E5%85%AC%E5%8F%B8%E6%93%81%E6%9C%89%E4%BA%BA%E6%87%89%E4%BD%B5%E6%BA%A2%E5%88%A9) - Profit attributable to owners of the Company increased by **33.5%** from approximately RMB28.0 million in the same period of 2024 to approximately **RMB37.4 million** in the same period of 2025[31](index=31&type=chunk) [Non-IFRS Measures – Adjusted Net Profit](index=9&type=section&id=%E9%9D%9E%E5%9C%8B%E9%9A%9B%E8%B2%A1%E5%8B%99%E5%A0%B1%E5%91%8A%E6%BA%96%E5%89%87%E8%A8%88%E9%87%8F%E2%80%94%E7%B6%93%E8%AA%BF%E6%95%B4%E7%B4%94%E5%88%A9) - Adjusted net profit aims to assess financial performance by excluding the impact of non-recurring and non-cash items such as share-based payment expenses, share of losses of associates and joint ventures, and impairment losses on loan receivables[32](index=32&type=chunk)[33](index=33&type=chunk) Calculation of Adjusted Net Profit Attributable to Owners of the Company (For the Six Months Ended June 30) | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Profit for the period attributable to owners of the Company | 37,395 | 28,009 | | Add: Share-based payment expenses | 3,646 | 13,993 | | Add: Share of losses of associates and joint ventures | 5,027 | — | | Add: Impairment losses recognized on loan receivables under expected credit loss model (net of income tax) | 28,834 | — | | **Adjusted Net Profit Attributable to Owners of the Company** | **74,902** | **42,002** | [Liquidity and Capital Resources](index=10&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E5%8F%8A%E8%B3%87%E6%9C%AC%E4%BE%86%E6%BA%90) [Cash and Cash Equivalents](index=10&type=section&id=%E7%8F%BE%E9%87%91%E5%8F%8A%E7%8F%BE%E9%87%91%E7%AD%89%E5%83%B9%E7%89%A9) - The Group primarily funds its operations with cash generated from operating activities[35](index=35&type=chunk) - As of June 30, 2025, cash and cash equivalents were approximately **RMB827.7 million**, an increase from approximately RMB755.0 million as of December 31, 2024[36](index=36&type=chunk) - The Company currently has no foreign currency hedging policy, but the Board will monitor risks and consider hedging[36](index=36&type=chunk) [Indebtedness and Gearing Ratio](index=11&type=section&id=%E5%82%B5%E5%8B%99%E5%8F%8A%E8%B3%87%E7%94%A2%E8%B2%A0%E5%82%B5%E6%AF%94%E7%8E%87) - As of the six months ended June 30, 2025, the Group had no short-term or long-term bank borrowings, except for lease liabilities of RMB15.8 million[37](index=37&type=chunk) - The gearing ratio was zero as of June 30, 2025, due to the absence of debt[38](index=38&type=chunk) [Pledge of Assets](index=11&type=section&id=%E8%B3%87%E7%94%A2%E6%8A%B5%E6%8A%BC) - As of June 30, 2025, the Group had not pledged any assets[39](index=39&type=chunk) [Capital Expenditure](index=11&type=section&id=%E8%B3%87%E6%9C%AC%E9%96%8B%E6%94%AF) - Capital expenditure for the six months ended June 30, 2025, was approximately **RMB58.3 million**, a significant decrease from approximately RMB216 million in the same period of 2024[40](index=40&type=chunk) - The decrease in capital expenditure was mainly due to the Group's reduced expenditure on acquiring investments in associates[40](index=40&type=chunk) [Contingent Liabilities and Guarantees](index=12&type=section&id=%E6%88%96%E7%84%B6%E8%B2%A0%E5%82%B5%E5%8F%8A%E6%93%94%E4%BF%9D) - As of June 30, 2025, the Group had no unrecorded material contingent liabilities, guarantees, or any litigation against the Group[41](index=41&type=chunk) [Material Acquisitions, Disposals and Future Plans for Major Investments](index=12&type=section&id=%E9%87%8D%E5%A4%A7%E6%94%B6%E8%B3%BC%E3%80%81%E5%87%BA%E5%94%AE%E5%8F%8A%E4%B8%BB%E8%A6%81%E6%8A%95%E8%B3%87%E7%9A%84%E6%9C%AA%E4%BE%86%E8%A8%88%E5%8A%83) - During the reporting period, the Group had no material acquisitions or disposals of subsidiaries, joint ventures, associates, or financial assets, nor any future plans for major investments or capital assets[42](index=42&type=chunk) [Employees and Staff Costs](index=12&type=section&id=%E5%83%B1%E5%93%A1%E5%8F%8A%E5%93%A1%E5%B7%A5%E6%88%90%E6%9C%AC) - As of June 30, 2025, the Group had a total of **612 full-time employees**, primarily located in mainland China[43](index=43&type=chunk) - Total staff costs for the six months ended June 30, 2025, were approximately **RMB67.3 million**, a decrease from approximately RMB99.8 million in the same period of 2024, mainly due to year-on-year reductions in salaries, other in-kind benefits, and share-based payment expenses[43](index=43&type=chunk) - The Board resolved to terminate the share option scheme on April 2, 2025, and adopted the 2025 share scheme on June 17, 2025[44](index=44&type=chunk) [Condensed Consolidated Financial Statements](index=13&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8) This section presents the company's unaudited condensed consolidated statement of profit or loss and other comprehensive income, statement of financial position, statement of changes in equity, and statement of cash flows for the six months ended June 30, 2025, providing financial data reflecting operating results, financial position, and cash flow changes during the reporting period [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=13&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E5%8F%8A%E5%85%B6%E4%BB%96%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the Six Months Ended June 30) | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 726,044 | 835,659 | | Cost of sales | (407,692) | (422,691) | | Gross profit | 318,352 | 412,968 | | Other income | 13,837 | 20,203 | | Other gains and losses | (3,263) | 15,667 | | Net exchange loss | (2,198) | (683) | | Selling and marketing expenses | (128,556) | (261,129) | | Administrative and other expenses | (60,424) | (66,637) | | Research and development expenses | (35,224) | (57,253) | | Impairment losses under expected credit loss model | (34,275) | (6,285) | | Share of results of associates | (310) | (14,928) | | Share of results of joint ventures | (4,717) | (960) | | Interest on lease liabilities | (444) | (629) | | Profit before income tax | 62,778 | 40,334 | | Income tax expense | (9,309) | (6,664) | | Profit and total comprehensive income for the period | 53,469 | 33,670 | | Profit for the period attributable to owners of the Company | 37,395 | 28,009 | | Profit for the period attributable to non-controlling interests | 16,074 | 5,661 | | Basic earnings per share (RMB cents) | 3.05 | 2.23 | | Diluted earnings per share (RMB cents) | 3.05 | 2.23 | [Condensed Consolidated Statement of Financial Position](index=14&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) Condensed Consolidated Statement of Financial Position (As of June 30) | Indicator | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | **Non-current Assets** | | | | Property, plant and equipment | 54,979 | 64,813 | | Right-of-use assets | 14,771 | 20,512 | | Intangible assets | 18,265 | 33,807 | | Investments in associates | 52,015 | 54,920 | | Investments in joint ventures | 39,858 | 39,575 | | Financial assets at fair value through profit or loss | 26,766 | 31,243 | | Equity instruments at fair value through other comprehensive income | 33,439 | 33,439 | | Non-current other receivables and deposits | 8,086 | 9,573 | | Deferred tax assets | 75,675 | 65,933 | | Receivables from disposal of subsidiaries | 5,500 | 5,500 | | Receivables from disposal of associates | 51,426 | — | | Loan receivables | 70,102 | 44,000 | | **Total Non-current Assets** | **450,882** | **403,315** | | **Current Assets** | | | | Trade receivables | 88,353 | 94,413 | | Financial assets at fair value through profit or loss | 446,057 | 393,726 | | Prepayments, other receivables and deposits | 86,790 | 182,882 | | Receivables from disposal of subsidiaries | 1,700 | 11,350 | | Receivables from disposal of associates | 54,709 | 106,989 | | Loan receivables | 107,532 | 104,403 | | Restricted bank deposits | — | 50,000 | | Short-term bank deposits | 162,000 | 65,000 | | Cash and cash equivalents | 827,676 | 755,032 | | **Total Current Assets** | **1,774,817** | **1,763,795** | | **Current Liabilities** | | | | Trade and other payables | 89,344 | 55,114 | | Deferred revenue | 111,809 | 147,105 | | Tax payable | 31,028 | 18,900 | | Lease liabilities | 6,255 | 8,365 | | Dividends payable | — | 4,800 | | **Total Current Liabilities** | **238,436** | **234,284** | | **Net Current Assets** | **1,536,381** | **1,529,511** | | **Total Assets Less Current Liabilities** | **1,987,263** | **1,932,826** | | **Non-current Liabilities** | | | | Lease liabilities | 9,519 | 12,888 | | Deferred tax liabilities | 1,721 | 3,786 | | **Total Non-current Liabilities** | **11,240** | **16,674** | | **Net Assets** | **1,976,023** | **1,916,152** | | **Capital and Reserves** | | | | Share capital | 42 | 42 | | Reserves | 1,921,015 | 1,882,018 | | Equity attributable to owners of the Company | 1,921,057 | 1,882,060 | | Non-controlling interests | 54,966 | 34,092 | | **Total Equity** | **1,976,023** | **1,916,152** | [Condensed Consolidated Statement of Changes in Equity](index=16&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%AC%8A%E7%9B%8A%E8%AE%8A%E5%8B%95%E8%A1%A8) Condensed Consolidated Statement of Changes in Equity (For the Six Months Ended June 30) | Indicator (RMB thousand) | Share Capital | Shares Held for Share Award Scheme | Share Premium | Statutory Reserve | Other Reserves | Share-based Payment Reserve | Fair Value Through Other Comprehensive Income Reserve | Retained Earnings | Subtotal Attributable to Owners of the Company | Non-controlling Interests | Total Equity | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | As at January 1, 2024 (Audited) | 42 | (9,551) | 40,163 | 15,027 | 19,199 | 13,878 | (13,593) | 2,018,138 | 2,083,303 | 847 | 2,084,150 | | Profit and total comprehensive income for the period | — | — | — | — | — | — | — | 28,009 | 28,009 | 5,661 | 33,670 | | Share-based payment expenses recognized under share option scheme and increase in fair value under compensation grants (as defined in Note 19) | — | — | — | — | — | 142 | — | — | 142 | — | 142 | | Share-based payment expenses recognized under 2021 Share Award Scheme | — | — | — | — | — | 43 | — | — | 43 | — | 43 | | Share-based payment expenses recognized under 2024 Share Award Scheme | — | — | — | — | — | 13,808 | — | — | 13,808 | — | 13,808 | | Awarded shares vested under compensation grants, 2021 Share Award Scheme and 2024 Share Award Scheme | — | 14,382 | 12,162 | — | — | (26,544) | — | — | — | — | — | | Share-based payment expenses related to forfeited share awards after vesting date | — | — | — | — | — | (1,327) | — | 1,327 | — | — | — | | Shareholder contribution | — | (64,790) | — | — | 64,790 | — | — | — | — | — | — | | Repurchase of shares | — | (10,894) | — | — | — | — | — | — | (10,894) | — | (10,894) | | Dividends recognized as distribution | — | — | — | — | — | — | — | (117,226) | (117,226) | — | (117,226) | | **As at June 30, 2024 (Unaudited)** | **42** | **(70,853)** | **52,325** | **15,027** | **83,989** | **—** | **(13,593)** | **1,930,248** | **1,997,185** | **6,508** | **2,003,693** | | As at January 1, 2025 (Audited) | 42 | (94,323) | 46,305 | 15,027 | 99,636 | — | (11,845) | 1,827,218 | 1,882,060 | 34,092 | 1,916,152 | | Profit and total comprehensive income for the period | — | — | — | — | — | — | — | 37,395 | 37,395 | 16,074 | 53,469 | | Share-based payment expenses recognized under 2025 Share Award Scheme | — | — | — | — | — | 3,646 | — | — | 3,646 | — | 3,646 | | Awarded shares vested under 2025 Share Award Scheme | — | 6,386 | (2,740) | — | — | (3,646) | — | — | — | — | — | | Repurchase of shares | — | (2,044) | — | — | — | — | — | — | (2,044) | — | (2,044) | | Cancellation of dividends paid to non-controlling interests | — | — | — | — | — | — | — | — | — | 4,800 | 4,800 | | **As at June 30, 2025 (Unaudited)** | **42** | **(89,981)** | **43,565** | **15,027** | **99,636** | **—** | **(11,845)** | **1,864,613** | **1,921,057** | **54,966** | **1,976,023** | Share Repurchase Details (For the Six Months Ended June 30) | Repurchase Month | Number of Ordinary Shares | Price Per Share (HKD) (Highest/Lowest) | Total Consideration Paid (HKD thousand) | | :--- | :--- | :--- | :--- | | **2025** | | | | | January | 580,000 | 1.494 / 1.363 | 836 | | May | 680,000 | 1.176 / 1.103 | 769 | | June | 526,000 | 1.288 / 1.122 | 624 | | **Total** | **1,786,000** | | **2,229** | | **2024** | | | | | January | 2,974,000 | 2.684 / 2.197 | 7,439 | | April | 1,352,000 | 2.248 / 1.966 | 2,962 | | June | 838,000 | 1.915 / 1.877 | 1,581 | | **Total** | **5,164,000** | | **11,982** | - For the six months ended June 30, 2025, the Company repurchased **1,786,000 shares** in the open market through Futu Securities International (Hong Kong) Limited, with a total consideration of approximately **RMB2,044,000**[51](index=51&type=chunk) [Condensed Consolidated Statement of Cash Flows](index=18&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) Condensed Consolidated Statement of Cash Flows (For the Six Months Ended June 30) | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | **Operating Activities** | | | | Profit for the period | 53,469 | 33,670 | | Operating cash flow before working capital changes | 137,859 | 51,018 | | Net cash generated from operating activities | 210,779 | 12,162 | | **Investing Activities** | | | | Net cash used in investing activities | (132,175) | (309,147) | | **Financing Activities** | | | | Net cash used in financing activities | (6,111) | (16,926) | | **Net increase (decrease) in cash and cash equivalents** | **72,493** | **(313,911)** | | Cash and cash equivalents at beginning of period | 755,032 | 1,340,918 | | Effect of exchange rate changes | 151 | 1,684 | | **Cash and cash equivalents at end of period** | **827,676** | **1,028,691** | [Notes to the Condensed Consolidated Financial Statements](index=20&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E8%A8%BB) This section provides detailed notes to the condensed consolidated financial statements, covering the company's general information, accounting policies, revenue composition, dividend policy, income tax calculation, profit for the period breakdown, earnings per share calculation, changes in investments in associates, financial asset classification, aging analysis of receivables and payables, and share capital structure, offering deeper context and explanations for the financial data [General Information and Basis of Preparation](index=20&type=section&id=%E4%B8%80%E8%88%AC%E8%B3%87%E6%96%99%E5%8F%8A%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%BA%96) - Home Interactive Entertainment Technology Co, Ltd was incorporated in the Cayman Islands, and its shares have been listed on the Main Board of the Stock Exchange of Hong Kong Limited since July 4, 2019[54](index=54&type=chunk) - The Group is principally engaged in the development, publishing, and operation of mobile games in China[54](index=54&type=chunk) - The condensed consolidated financial statements are presented in RMB, which is also the functional currency of the Group[55](index=55&type=chunk) [Accounting Policies](index=20&type=section&id=%E6%9C%83%E8%A8%88%E6%94%BF%E7%AD%96) - The condensed consolidated financial statements are prepared on a historical cost basis, except for certain financial instruments measured at fair value[57](index=57&type=chunk) - The accounting policies and methods of calculation adopted for the condensed consolidated financial statements for the six months ended June 30, 2025, are consistent with those presented in the annual financial statements for the year ended December 31, 2024[57](index=57&type=chunk) - During this interim period, the Group has first adopted the revised IFRS accounting standards that are mandatorily effective for annual periods beginning on or after January 1, 2025, which had no significant impact on the financial position and performance[58](index=58&type=chunk) [Revenue and Segment Information](index=21&type=section&id=%E6%94%B6%E7%9B%8A%E5%8F%8A%E5%88%86%E9%83%A8%E8%B3%87%E6%96%99) - Revenue refers to income from the sale of virtual tokens for self-developed mobile games, third-party mobile games, and advertising income[59](index=59&type=chunk) - The Group's operating activities are conducted by a single operating segment focused on mobile game development and operation[59](index=59&type=chunk) - Revenue from self-developed and third-party mobile games is recognized at the point in time when the customer obtains control of the service; advertising revenue is recognized when advertisements placed on third-party platforms are displayed in the game interface[59](index=59&type=chunk)[60](index=60&type=chunk) - The Group has a large number of customers, and no single customer accounted for 10% or more of the Group's revenue in either period[61](index=61&type=chunk) [Dividends](index=22&type=section&id=%E8%82%A1%E6%81%AF) - No dividends were declared and paid during this interim period[62](index=62&type=chunk) - In the previous interim period, a final dividend of HKD0.10 per share (equivalent to RMB0.09) for the year ended December 31, 2023, was declared and paid on July 11, 2024, totaling approximately RMB117,226,000[62](index=62&type=chunk) [Income Tax Expense](index=23&type=section&id=%E6%89%80%E5%BE%97%E7%A8%85%E9%96%8B%E6%94%AF) Income Tax Expense Analysis (For the Six Months Ended June 30) | Tax Category | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Current tax—PRC corporate income tax | 19,542 | 21,835 | | Under-provision (over-provision) in prior years | 1,574 | (3,580) | | Deferred tax | (11,807) | (11,591) | | **Total** | **9,309** | **6,664** | - Yaotang (Xiamen) Network Technology Co, Ltd and Jilin Haiqi Network Technology Co, Ltd are recognized as "Double Software Enterprises," enjoying a two-year corporate income tax exemption followed by a three-year 50% tax rate reduction[64](index=64&type=chunk) - Yaotang (Shenzhen) Network Technology Co, Ltd obtained High-tech Enterprise certification, enjoying a preferential income tax rate of 15%[65](index=65&type=chunk) - Enterprises engaged in R&D activities are entitled to deduct 200% of R&D expenses incurred in the current year as deductible expenses (super deduction)[65](index=65&type=chunk) [Profit for the Period](index=24&type=section&id=%E6%9C%9F%E5%85%A7%E6%BA%A2%E5%88%A9) Profit for the Period Deductions (For the Six Months Ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Commissions and fees charged by distribution channels and payment providers | 203,693 | 288,031 | | Depreciation of property, plant and equipment | 12,611 | 8,007 | | Depreciation of right-of-use assets | 3,603 | 5,530 | | Amortization of intangible assets | 16,133 | 470 | | Impairment losses under expected credit loss model | 34,275 | 6,285 | | Directors' remuneration | 5,092 | 8,108 | | Total other staff costs | 67,310 | 99,847 | [Earnings Per Share](index=25&type=section&id=%E6%AF%8F%E8%82%A1%E7%87%9F%E5%88%A9) Calculation of Basic and Diluted Earnings Per Share (For the Six Months Ended June 30) | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Profit for the purpose of calculating basic and diluted earnings per share: Profit for the period attributable to owners of the Company | 37,395 | 28,009 | | | | | | Number of Shares | 2025 (Unaudited) | 2024 (Unaudited) | | Weighted average number of ordinary shares for the purpose of calculating basic and diluted earnings per share | 1,226,335,488 | 1,254,914,473 | - Share awards had no impact on diluted earnings per share for the current and previous interim periods[70](index=70&type=chunk) [Investments in Associates](index=26&type=section&id=%E6%96%BC%E8%81%AF%E7%87%9F%E5%85%AC%E5%8F%B8%E7%9A%84%E6%8A%95%E8%B3%87) Investments in Associates (As of June 30) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Cost of investments in associates | 58,538 | 61,100 | | Share of post-acquisition results (net of dividends received) | (6,523) | (6,180) | | **Total** | **52,015** | **54,920** | - During this interim period, investments were made in two new associates primarily engaged in game development, with a total consideration of **RMB850,000**[71](index=71&type=chunk) - During this interim period, interests in Chongqing Huangjiu Technology Co, Ltd and Guangzhou Yaoyang Technology Co, Ltd were disposed of for a total consideration of **RMB6,212,000**[71](index=71&type=chunk) - On June 1, 2025, a supplemental agreement was signed with an entity controlled by Mr Luo Wei, revising the repayment date for the outstanding consideration of RMB99,900,000 and recognizing a loss of **RMB10,351,000** due to the derecognition of receivables from the disposal of an associate[73](index=73&type=chunk) [Financial Assets at Fair Value Through Profit or Loss](index=27&type=section&id=%E6%8C%89%E5%85%AC%E5%B9%B3%E5%80%BC%E8%A8%88%E9%87%8F%E4%B8%94%E5%85%B6%E8%AE%8A%E5%8B%95%E8%A8%88%E5%85%A5%E6%90%8D%E7%9B%8A%E4%B9%8B%E9%87%91%E8%9E%8D%E8%B3%87%E7%94%A2) Financial Assets at Fair Value Through Profit or Loss (As of June 30) | Category | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | **Non-current Unlisted Securities** | | | | —Investments in partnership enterprises | 26,766 | 31,243 | | **Current Listed Securities Held for Trading** | | | | —Equity securities on SSE | — | 25,696 | | **Current Unlisted Securities Held for Trading** | | | | —Private equity funds | 276,879 | 129,269 | | —Money market funds | 148,752 | 106,461 | | —Structured deposits | 20,426 | 132,300 | | **Total** | **446,057** | **393,726** | [Trade Receivables](index=28&type=section&id=%E8%B2%BF%E6%98%93%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85) Aging Analysis of Trade Receivables (As of June 30) | Aging | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | 0 to 30 days | 71,402 | 77,594 | | 31 to 60 days | 9,594 | 11,494 | | 61 to 90 days | 1,573 | 2,469 | | 91 to 180 days | 1,876 | 284 | | Over 180 days | 3,911 | 2,572 | | **Total** | **88,356** | **94,413** | - The credit period for trade receivables is generally **0 to 90 days**[77](index=77&type=chunk) - As of June 30, 2025, overdue balances of **RMB3,911,000** were overdue for 90 days or more but were not considered in default due to the debtors' cooperative history and good collection history[77](index=77&type=chunk) [Prepayments, Other Receivables and Deposits](index=29&type=section&id=%E9%A0%90%E4%BB%98%E6%AC%BE%E9%A0%85%E3%80%81%E5%85%B6%E4%BB%96%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85%E5%8F%8A%E6%8C%89%E9%87%91) Prepayments, Other Receivables and Deposits (As of June 30) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Prepayments for co-operation commissions | 12,349 | 71,356 | | Prepayments for R&D expenses | 14,365 | 15,040 | | Prepayments for advertising and promotion expenses | 11,886 | 43,793 | | Prepayments to game developers | 11,630 | 5,863 | | Prepayments for game and server related expenses | 1,874 | 2,637 | | Loans to employees | 14,270 | 21,139 | | Lease and other deposits | 7,836 | 8,413 | | VAT and other recoverable taxes | 8,063 | 11,522 | | Loans to employees | 4,580 | 279 | | Other receivables | 12,972 | — | | Others | 8,049 | 12,439 | | **Total** | **107,874** | **192,481** | | Less: Provision for credit losses | (12,998) | (26) | | **Adjusted Total** | **94,876** | **192,455** | - The provision for credit losses is mainly for other receivables from co-operation commissions paid due to Chengdu Weiying facing significant financial difficulties[78](index=78&type=chunk) [Trade and Other Payables](index=30&type=section&id=%E8%B2%BF%E6%98%93%E5%8F%8A%E5%85%B6%E4%BB%96%E6%87%89%E4%BB%98%E6%AC%BE%E9%A0%85) Trade and Other Payables (As of June 30) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Trade payables | 36,986 | — | | Other payables | 52,358 | 55,114 | | **Total** | **89,344** | **55,114** | Aging Analysis of Trade Payables (As of June 30) | Aging | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | 0 to 60 days | 6,778 | — | | 61 to 90 days | 8,409 | — | | Over 90 days | 21,799 | — | | **Total** | **36,986** | **—** | [Share Capital](index=30&type=section&id=%E8%82%A1%E6%9C%AC) - As of June 30, 2025, the authorized share capital was **10,000,000,000 ordinary shares** of USD0.000005 each, with a par value of USD50,000[79](index=79&type=chunk) - The issued and fully paid share capital was **1,283,403,500 ordinary shares** of USD0.000005 each, with a par value of USD6,417, equivalent to RMB42 thousand[79](index=79&type=chunk) [Other Information](index=31&type=section&id=%E5%85%B6%E4%BB%96%E8%B3%87%E6%96%99) This section discloses the company's share repurchase activities during the reporting period, confirms no significant events after the reporting period, highlights continuous compliance with corporate governance codes and directors' securities transaction standards, notes the audit committee's review of interim results, and states the decision not to declare an interim dividend to conserve capital for business development [Purchase, Sale and Redemption of the Company’s Listed Securities](index=31&type=section&id=%E8%B3%BC%E8%B2%B7%E3%80%81%E5%87%BA%E5%94%AE%E5%8F%8A%E8%B4%96%E5%9B%9E%E6%9C%AC%E5%85%AC%E5%8F%B8%E4%B8%8A%E5%B8%82%E8%AD%89%E5%88%B8) - For the six months ended June 30, 2025, Futu Securities International (Hong Kong) Limited, as an independent trustee of the share award scheme, purchased **1,786,000 shares** in the open market for a total consideration of **RMB2,044,000**, for future grants under the share award scheme[80](index=80&type=chunk) - As of June 30, 2025, the Company and its subsidiaries did not hold any treasury shares[81](index=81&type=chunk) [Events After the Reporting Period](index=31&type=section&id=%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%BE%8C%E4%BA%8B%E9%A0%85) - No significant events affecting the Group have occurred from the end of the reporting period up to the date of this announcement[82](index=82&type=chunk) [Corporate Governance](index=31&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB) - The Company has complied with the applicable code provisions of the Corporate Governance Code set out in Appendix C1 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited for the six months ended June 30, 2025[83](index=83&type=chunk) [Compliance with the Model Code for Securities Transactions by Directors](index=31&type=section&id=%E9%81%B5%E5%AE%88%E8%91%A3%E4%BA%8B%E9%80%B2%E8%A1%8C%E8%AD%89%E5%88%B8%E4%BA%A4%E6%98%93%E7%9A%84%E6%A8%99%E6%BA%96%E5%AE%88%E5%89%87) - Following specific enquiries by the Company, all Directors confirmed their compliance with the "Model Code for Securities Transactions by Directors of Listed Issuers" set out in Appendix C3 to the Listing Rules throughout the reporting period[84](index=84&type=chunk) [Audit Committee](index=32&type=section&id=%E5%AF%A9%E6%A0%B8%E5%A7%94%E5%93%A1%E6%9C%83) - The Audit Committee comprises three independent non-executive Directors: Mr Hu Yangyang (Chairman), Mr Zhang Yuguo, and Ms Guo Ying[85](index=85&type=chunk) - The Audit Committee has reviewed the Company's unaudited condensed interim results for the reporting period and confirmed compliance with applicable accounting principles, standards, and requirements, with adequate disclosures made[85](index=85&type=chunk) [Changes in Directors’ Biographical Details under Rule 13.51B(1) of the Listing Rules](index=32&type=section&id=%E4%B8%8A%E5%B8%82%E8%A6%8F%E5%89%87%E7%AC%AC13.51B%20(1)%E6%A2%9D%E9%A0%85%E4%B8%8B%E8%91%A3%E4%BA%8B%E5%B1%A5%E6%AD%B7%E8%A9%B3%E6%83%85%E8%AE%8A%E5%8B%95) - There were no changes in Directors' biographical details requiring disclosure under Rule 13.51B(1) of the Listing Rules[86](index=86&type=chunk) [Interim Dividend](index=32&type=section&id=%E4%B8%AD%E6%9C%9F%E8%82%A1%E6%81%AF) - The Board resolved not to declare an interim dividend for the six months ended June 30, 2025 (2024: nil), to retain capital for strategic business development[87](index=87&type=chunk) [Publication of Interim Results and Interim Report](index=32&type=section&id=%E5%88%8A%E8%BC%89%E4%B8%AD%E6%9C%9F%E6%A5%AD%E7%B8%BE%E5%8F%8A%E4%B8%AD%E6%9C%9F%E5%A0%B1%E5%91%8A) - This announcement is published on the HKEX website and the Company's website, with the interim report to be published on both websites in due course[88](index=88&type=chunk)

格隆汇8月13日丨家乡互动(03798.HK)公告，公司将于2025年8月28日(星期四)举行董事会会议，藉以(其 中包括)考虑及批准公司及其附属公司截至2025年6月30日止6个月中期业绩及其发布。 ...

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其 準確性或完整性亦不發表任何聲明，並明確表示，概不對因本公告全部或任何部份內容 而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 Homeland Interactive Technology Ltd. 家 鄉 互 動 科 技 有 限 公 司 （ 於開曼群島註冊成立的有限公司） （股份代號：3798） 董事會會議日期 家鄉互動科技有限公司（「本公司」）董事（「董事」）會（「董事會」）謹此宣佈， 本 公 司 將 於 2025 年 8 月 28 日（ 星 期 四 ）舉 行 董 事 會 會 議 ， 藉 以（ 其 中 包 括 ）考 慮及批准本公司及其附屬公司截至2025年6月30日止六個月之中期業績及其 發佈。 承董事會命 中國深圳，2025年8月13日 於本公告日期，董事會成員包括執行董事吳承澤先生、蘇波先生及丁春龍先生；以及獨 立非執行董事張玉國先生、胡洋洋先生及郭瑩女士。 家鄉互動科技有限公司 主席 吳承澤 ...

公司名稱: 家鄉互動科技有限公司 呈交日期: 2025年8月4日 股份發行人及根據《上市規則》第十九B章上市的香港預託證券發行人的證券變動月報表 截至月份: 2025年7月31日 狀態: 新提交 致：香港交易及結算所有限公司 I. 法定/註冊股本變動 | 1. 股份分類 | 普通股 | 股份類別 | 不適用 | | 於香港聯交所上市 (註1) | | | 是 | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | 證券代號 (如上市) | 03798 | 說明 | 普通股 | | | | | | | | | | 法定/註冊股份數目 | | | 面值 | | | 法定/註冊股本 | | | 上月底結存 | | | 10,000,000,000 | USD | | 0.000005 | USD | | 50,000 | | 增加 / 減少 (-) | | | | | | | USD | | | | 本月底結存 | | | 10,000,000,000 | USD | | 0.000005 | USD | | 50,000 | 本月底法 ...

Core Viewpoint - The company, Jiaxiang Interactive, reported its first net profit loss since its IPO in 2019, with a revenue of 1.386 billion yuan, down 22.13% year-on-year, and a net loss of 74.17 million yuan, down 116.93% year-on-year [3][5][6] Financial Performance - Jiaxiang Interactive's operating revenue for 2024 was 1.386 billion yuan, a decrease of 22.13% compared to the previous year [3][5] - The net profit loss of 74.17 million yuan marked the company's first loss since its listing [6] - The net cash flow from operating activities was 71.07 million yuan, down 83.87% year-on-year [5] - Sales and marketing expenses increased by 31.1% year-on-year to 447 million yuan, primarily due to a rise in advertising and promotional costs [4][8] Business Strategy and Market Position - Jiaxiang Interactive focuses on localizing card games, particularly Mahjong and Poker, and has transitioned from a regional to a national market presence [6] - The company has over 1,000 streamers promoting its games through various interactive events, which has generated significant traffic for its core products [4][8] - Despite the increase in marketing expenses, the company acknowledged that these investments did not effectively drive revenue growth, leading to pressure on overall profitability [4][9] User Engagement and Product Development - The company reported a decline in daily active users (DAU) and monthly active users (MAU), with DAU at 13.37 million and MAU at 64.34 million, down from 14.38 million and 68.28 million respectively [6][7] - In 2024, Jiaxiang Interactive plans to launch two key products targeting the Middle Eastern and Japanese markets, with adaptations to local cultures [7] - The company has also introduced 3D versions of its core products, but these new releases have not yet significantly impacted revenue [6] Marketing and User Acquisition - Jiaxiang Interactive has adopted a multi-channel marketing strategy, including partnerships with leading streamers and MCN agencies to enhance brand exposure and user acquisition [8] - The number of paying users increased by 35% year-on-year to 17.8 million, indicating a growing willingness to pay among users [8] - The company is exploring new distribution channels, including mini-programs on platforms like Douyin, to enhance game accessibility [10]

Financial Performance - Total revenue for 2024 was RMB 1,386,080,000, a decrease of 22.1% compared to RMB 1,779,667,000 in 2023[10] - Gross profit for 2024 was RMB 629,586,000, down 45.4% from RMB 1,157,455,000 in 2023[10] - The company reported a net loss of RMB 76,221,000 for 2024, marking its first loss since going public[12] - Total equity decreased to RMB 1,916,152,000 in 2024 from RMB 2,084,150,000 in 2023[11] - Adjusted net profit attributable to the company was RMB 295 million, while considering non-operating one-time factors, a loss of RMB 742 million was recorded[23] - Profit attributable to owners of the company decreased from approximately RMB 436.9 million for the year ended December 31, 2023, to a loss of approximately RMB 74.2 million for the year ending December 31, 2024, primarily due to reduced game revenue and gross profit, increased selling and marketing expenses, and losses from associates and joint ventures[39] - The group recorded a loss before tax of approximately RMB 91.5 million for the year ended December 31, 2024, compared to a profit of RMB 501.1 million in 2023, representing a decrease of approximately 118.3%[37] User Engagement and Market Strategy - Daily Active Users (DAU) and Monthly Active Users (MAU) for existing business reached 13.37 million and 64.34 million respectively, with a 35% year-on-year increase in paying users, totaling 17.8 million[15] - Daily Active Users (DAU) reached 13.38 million, with Monthly Active Users (MAU) averaging 64.34 million, showing stable user engagement[22] - The number of paying users increased significantly to 17.76 million, representing a 35% year-over-year growth[22] - The company focused on localizing products to enhance user engagement in targeted regional markets[13] - The company increased marketing investments in regional markets to improve user penetration rates[13] - The company is focusing on a "culture + game" export model to gain international market recognition and build a unique competitive advantage[20] - The company aims to penetrate regional markets and expand user scale by optimizing products and marketing strategies tailored to local entertainment needs[27] Product Development and Innovation - The flagship games "Weile Doudizhu" and "Weile Sichuan Mahjong" underwent a 3D upgrade to enhance user experience[13] - The company launched 3D versions of core products, enhancing visual performance and user experience[22] - The company successfully launched the casual SLG game "Home Garden: Dream Party," expanding its product line[24] - The company is actively advancing AI deployment, having completed initial deployment of its self-developed AI agent, which has improved R&D efficiency[19] - Advanced AI technologies, including DeepSeek, were integrated into business processes to enhance operational efficiency[25] - The company launched two new games on the Douyin platform, achieving significant early success with high rankings in multiple core lists, indicating strong adaptability and commercialization potential in new media channels[15] Marketing and Sales - Marketing expenses increased by RMB 106 million, contributing to pressure on overall profitability[23] - Sales and marketing expenses increased by approximately 31.1% to RMB 446.7 million, primarily due to increased promotional and advertising expenditures[35] - A series of short videos titled "Mahjong Mahjong Shake It Up" garnered over 200 million views, significantly lowering the participation threshold for the public[17] - The company successfully hosted multiple large-scale online tournaments, achieving a total topic playback of 150 million and 15 million cumulative viewers, enhancing user engagement[18] Global Expansion and Strategic Initiatives - The company is accelerating its globalization strategy, with successful launches of games like "Micro Fishing Overseas Version" in multiple international markets[20] - Two key products targeting the Middle East and Japan markets are set to launch in 2025, incorporating local cultural elements while retaining traditional gameplay[20] - The company is exploring potential acquisitions to enhance its product portfolio, with a budget of $50 million allocated for this purpose[67] - The company is committed to long-term sustainable development and optimizing operational efficiency despite short-term profitability pressures[24] Financial Management and Compliance - The company maintained a zero leverage ratio as of December 31, 2024, with no short-term or long-term bank borrowings[46] - The company has adopted a prudent financial management approach to monitor liquidity and ensure the ability to meet funding needs[43] - The company will not distribute an annual dividend this year to focus resources on business expansion, technological innovation, and global strategy deployment[26] - The company has established a framework for regular reporting on compliance with the original contractual arrangements from relevant business units and operational divisions at least monthly[166] Corporate Governance and Shareholder Matters - The company has adopted corporate governance principles and has complied with the applicable code provisions without any deviations during the year ended December 31, 2024[199] - The independent auditor Deloitte confirmed no reservations regarding the related party transactions for the year ending December 31, 2024[168] - The company has confirmed that there are no related party transactions requiring independent shareholder approval as of the report date[169] - The board of directors has approved a share buyback program worth $10 million to enhance shareholder value[67] Risks and Challenges - The group faces risks related to its revenue dependence on two main game types, Mahjong and Poker variants, which could significantly impact business performance if not maintained or improved[75] - A small portion of registered players are paying users, and the group must effectively promote player payments to sustain growth[81] - The group relies on third-party payment providers, primarily WeChat Pay and Alipay, which introduces risks related to payment transmission stability[81] - The company may incur higher income tax liabilities due to differing tax rates applicable to the company and its Chinese operating entities, which could adversely affect its operating performance[162]

Financial Performance - For the fiscal year ending December 31, 2024, the company's revenue was RMB 1,386,080,000, a decrease of 22.1% compared to RMB 1,779,667,000 in 2023[3] - Gross profit for the same period was RMB 629,586,000, down 45.6% from RMB 1,157,455,000 year-over-year[3] - The company reported a loss before tax of RMB 91,542,000, a decline of 118.3% compared to a profit of RMB 501,097,000 in the previous year[3] - The adjusted net profit attributable to the company's owners was RMB 29,520,000, contrasting sharply with RMB 499,393,000 in 2023[3] - The group reported a net loss of RMB 76.2 million for the year ended December 31, 2024, compared to a profit of RMB 440.5 million in 2023[48] - The basic and diluted loss attributable to shareholders for the year ended December 31, 2024, is RMB (74,174,000) compared to a profit of RMB 436,936,000 for the year ended December 31, 2023[67] User Metrics - Daily active users (DAUs) as of December 31, 2024, were 13,377,495, slightly up from 13,360,659 on June 30, 2024, but down from 14,389,388 a year earlier[6] - The number of paying users reached 17,756,141, an increase from 15,691,516 in the previous six months and significantly up from 13,104,865 a year ago[6] - Monthly average active users (MAUs) were 64,342,667, down from 68,289,393 in the same period last year[6] - As of December 31, 2024, the company reported a daily active user (DAU) count of 13.38 million and a monthly active user (MAU) count of 64.34 million, maintaining relative stability year-on-year and quarter-on-quarter[7] - The number of paying users increased significantly to 17.76 million, representing a year-on-year growth of 35%[7] Revenue Breakdown - Revenue from self-developed mobile games was RMB 1,212,269,000, accounting for 87.46% of total revenue, while third-party mobile games contributed RMB 140,153,000, or 10.11%[4] - Revenue from self-developed mobile games decreased to RMB 1,212,269,000 in 2024 from RMB 1,566,458,000 in 2023, a decline of approximately 22.5%[58] - Advertising revenue decreased by 50.5% to RMB 33,658,000 from RMB 68,000,000 in the previous year[4] - Revenue from mainland China was RMB 1,329,281,000 in 2024, down from RMB 1,779,667,000 in 2023, a decrease of about 25.3%[59] Cost and Expenses - The group's sales cost increased by approximately 21.6% from RMB 622.2 million in 2023 to RMB 756.5 million in 2024, primarily due to increased commissions paid to new media and game operators[21] - Marketing expenses increased by RMB 106 million, contributing to pressure on overall profitability despite significant investments in promotional activities[9] - Sales and marketing expenses increased by approximately 31.1% from RMB 340.6 million to RMB 446.7 million, driven by an increase in advertising expenses by RMB 136.5 million[26] - Administrative and other expenses decreased by approximately 26.2% from RMB 387.9 million to RMB 286.2 million, mainly due to a reduction in share-based payment expenses by RMB 48.6 million and R&D expenses by RMB 35.7 million[27] - The total employee costs for the year ended December 31, 2024, were approximately RMB 192.1 million, down from RMB 278.9 million in 2023, reflecting a reduction due to workforce downsizing and cost control measures[44] Strategic Initiatives - The company is focusing on expanding its market presence and enhancing its product offerings through new technology developments and strategic initiatives[5] - The company introduced new payment mechanisms and restructured the in-game economy, enhancing user engagement and social interaction within its products[7] - The company successfully launched the casual SLG game "Home Garden: Dream Party" as part of its diversified strategy, aiming to explore new growth points[10] - The international versions of "Micro Fishing" performed well, contributing to considerable overseas revenue, with plans to expand into markets in Japan, South Korea, Southeast Asia, and the Middle East[10] - The company plans to expand its user base by targeting lower-tier markets through localized entertainment offerings and differentiated marketing strategies[15] - The strategy includes strengthening product reserves and accelerating the launch of overseas products to diversify revenue streams[16] Financial Position - As of December 31, 2024, the group had cash and cash equivalents of approximately RMB 755.0 million, a decrease from RMB 1,340.9 million as of December 31, 2023[36] - The group's capital expenditure for the year ended December 31, 2024, was approximately RMB 387.8 million, significantly up from RMB 63.8 million for the year ended December 31, 2023[41] - The group has a total equity of RMB 1,916,152 thousand in 2024, down from RMB 2,084,150 thousand in 2023, indicating a decrease of about 8.0%[50] - Total liabilities increased from RMB 190,164 thousand in 2023 to RMB 234,284 thousand in 2024, marking an increase of approximately 23.2%[50] - The company has no short-term or long-term bank borrowings as of December 31, 2024, resulting in a leverage ratio of zero[39] Compliance and Governance - The company has complied with the Corporate Governance Code throughout the year ended December 31, 2024[76] - The annual performance has been audited by Deloitte, confirming compliance with applicable accounting principles and sufficient disclosure[79] - The company has not adopted any new or revised International Financial Reporting Standards that would have a significant impact on the financial statements for the current or prior years[52] Dividend Policy - The group will not distribute annual dividends this year to concentrate resources on business expansion and technological innovation[13] - The company has decided not to recommend the distribution of a final dividend for the fiscal year ending December 31, 2024, in order to retain funds for strategic business development[81] - The final dividend for the year ended December 31, 2023, is HKD 0.10 per share, totaling HKD 128,340,350 (approximately RMB 118,073,122) to be paid on July 11, 2024[65]

Market Expansion and Strategy - Overseas markets such as Southeast Asia, Japan, North America, and the Middle East will be explored further, with new casual social games expected to launch soon[8] - The company plans to deepen regional market penetration and increase marketing efforts in underdeveloped areas in China[10] - New marketing channels, including collaborations with MCNs and influencers, will be explored to reduce customer acquisition costs[11] - Increased R&D investment will focus on preparing and launching new products for both domestic and overseas markets[12] - The company aims to identify potential business opportunities through partnerships, acquisitions, and investments in promising R&D teams[13] Financial Performance - Revenue decreased by 12.4% to RMB 835.7 million in the first half of 2024 compared to RMB 953.5 million in the same period of 2023, primarily due to a decrease in ARPPU despite a 70.0% increase in paying users[14] - Revenue breakdown for the first half of 2024: 91.2% from virtual token sales, 6.4% from third-party mobile game distribution, and 2.4% from advertising, compared to 85.9%, 9.9%, and 4.2% respectively in the same period of 2023[14] - Cost of sales increased by 35.2% to RMB 422.7 million in the first half of 2024, driven by higher commissions to third-party distribution channels, increased new media costs, and higher employee benefits[15] - Gross profit decreased by 35.6% to RMB 413.0 million, with gross margin dropping from 67.2% in the first half of 2023 to 49.4% in the first half of 2024[16] - Selling and marketing expenses surged by 101.4% to RMB 261.1 million in the first half of 2024, mainly due to increased advertising and marketing expenditures to maintain market share[20] - Profit before tax plummeted by 91.0% to RMB 40.3 million in the first half of 2024, with the profit margin declining from 47.1% to 4.8%[22] - Net profit attributable to owners of the company dropped by 92.9% to RMB 28.0 million in the first half of 2024[24] - The company's adjusted net profit attributable to owners for the six months ended June 30, 2024, was approximately RMB 42.0 million, a significant decrease of 90.6% compared to RMB 445.6 million for the same period in 2023[26] - Revenue for the six months ended June 30, 2024, decreased to RMB 835.659 million from RMB 953.477 million in the same period in 2023, representing a decline of approximately 12.4%[37] - Gross profit for the six months ended June 30, 2024, was RMB 412.968 million, down from RMB 640.840 million in 2023, a decrease of approximately 35.5%[37] - Net profit attributable to the company's owners for the six months ended June 30, 2024, was RMB 28.009 million, a significant drop from RMB 395.293 million in 2023, representing a decline of approximately 92.9%[38] - Basic earnings per share for the six months ended June 30, 2024, were RMB 0.0223, compared to RMB 0.3098 in 2023, a decrease of approximately 92.8%[38] - The company's profit attributable to owners for the six months ended June 30, 2024, was RMB 28,009 thousand, a significant decrease from RMB 395,293 thousand in the same period in 2023[63] Cash Flow and Capital Expenditures - Cash and cash equivalents as of June 30, 2024, were approximately RMB 1,028.7 million, down from RMB 1,340.9 million as of December 31, 2023[28] - Capital expenditures for the six months ended June 30, 2024, were approximately RMB 261.3 million, a significant increase from RMB 71.2 million in the same period in 2023[31] - Net cash generated from operating activities was RMB 12,162, compared to RMB 182,951 in the same period last year[47] - Net cash used in investing activities was RMB 309,147, primarily due to purchases of financial assets and investments in associates and joint ventures[47] - Net cash used in financing activities was RMB 16,926, including RMB 10,894 for share repurchases[47] - Cash and cash equivalents decreased by RMB 313,911, ending the period at RMB 1,028,691[47] Shareholder and Equity Information - The company had no short-term or long-term bank borrowings as of June 30, 2024, except for lease liabilities totaling RMB 20.5 million[29] - The company's debt-to-asset ratio was zero as of June 30, 2024, indicating no debt[30] - Total assets as of June 30, 2024, were RMB 2.010 billion, slightly up from RMB 1.887 billion as of December 31, 2023[39] - Current liabilities as of June 30, 2024, increased to RMB 304.944 million from RMB 190.164 million as of December 31, 2023, representing an increase of approximately 60.3%[39] - Net current assets as of June 30, 2024, were RMB 1.705 billion, slightly up from RMB 1.697 billion as of December 31, 2023[39] - Total equity as of June 30, 2024, was RMB 2.003 billion, down from RMB 2.084 billion as of December 31, 2023, representing a decrease of approximately 3.9%[40] - Non-current liabilities as of June 30, 2024, were RMB 12.863 million, slightly up from RMB 12.602 million as of December 31, 2023[40] - The company's net asset value as of June 30, 2024, was RMB 2.003 billion, down from RMB 2.084 billion as of December 31, 2023, representing a decrease of approximately 3.9%[40] - Dividends distributed during the period amounted to RMB 117.226 million[44] - Share-based payment expenses under the 2024 share incentive plan were RMB 13.808 million[44] - Share repurchases during the period totaled RMB 10.894 million[44] - Total equity as of January 1, 2024, was RMB 2,084.150 million, with a net profit of RMB 28.009 million for the period[44] - Share-based payment expenses under the 2021 share incentive plan were RMB 142,000[44] - Total equity as of June 30, 2023, was RMB 2,050.575 million, with a net profit of RMB 402.557 million for the period[43] - Share-based payment expenses under the 2023 share incentive plan were RMB 27.152 million[43] - Dividends distributed during the period amounted to RMB 162.823 million[43] - Total equity increased to 5,164,000 from 11,982 during the six months ended June 30, 2024[45] - The company received a donation of 32,085,086 shares from two shareholders, with a fair value of RMB 64,790,000[45] - The company repurchased 5,164,000 shares at prices ranging from HKD 1.915 to HKD 2.684, with a total cost of RMB 10,893,569 (HKD 11,982,260)[45] - The company declared a final dividend of HKD 0.10 per share, totaling HKD 128.3 million, compared to HKD 0.14 per share in the previous period[57] Share Incentive Plans and Awards - The company's share-based payment plan allows for the issuance of up to 10% of the total issued shares as of the listing date, which is 125,600,000 shares[86] - On November 14, 2019, the company granted options to 58 eligible employees to subscribe for a total of 62,360,000 ordinary shares with a fair value of HKD 47,452,000 (RMB 42,508,000)[87] - The exercise price for the granted options is HKD 2.09 per share, with vesting periods of 30% on November 14, 2020, 40% on November 14, 2021, and 30% on November 14, 2022[87] - As of September 30, 2021, 1,600,000 options were forfeited due to the termination of employment of two grantees, and 60,760,000 options remained unexercised[87] - The company compensated the remaining option holders with share awards, with compensation ratios of 0.35, 0.5, and 0.8333 shares per unexercised option[88] - 26 remaining option holders received 9,278,500 compensation shares for 26,510,000 unexercised options at a ratio of 0.35 shares per option[88] - 29 remaining option holders received 16,525,000 compensation shares for 33,050,000 unexercised options at a ratio of 0.5 shares per option[88] - 1 remaining option holder received 1,000,000 compensation shares for 1,200,000 unexercised options at a ratio of approximately 0.8333 shares per option[88] - A total of 26,803,500 compensation share awards were granted as compensation for the cancellation of unexercised existing share options[89] - 40% of the total share awards will vest on April 30, 2022, 30% on April 30, 2023, and 30% on April 30, 2024[89] - For the vesting on April 30, 2024, the company's consolidated revenue for the year ending December 31, 2023, should increase by at least 20% compared to the year ending December 31, 2020[89] - 5,343,000 shares vested during the period ending June 30, 2024, with 195,000 shares forfeited[91] - The fair value increase of HKD 7,710,000 will be amortized over the vesting periods ending April 30, 2022, April 30, 2023, and April 30, 2024, at 40%, 30%, and 30% respectively[92] - The company recognized share-based payment expenses of RMB 142,000 for the period ending June 30, 2024[92] - 600,000 share awards were granted under the 2021 Share Award Plan to two grantees on September 30, 2021[93] - For the 2021 Share Award Plan, 40% of the total share awards will vest on April 30, 2022, 30% on April 30, 2023, and 30% on April 30, 2024[93] - The company's operating profit should account for at least 75% of the total profit for the year ending December 31, 2023, for the vesting on April 30, 2024[93] - The company recognized share-based payment expenses of RMB 43,000 related to the 2021 Share Award Plan for the period ending June 30, 2024, compared to RMB 102,000 for the same period in 2023[95] - The 2023 Share Award Plan granted 19,311,675 shares to 21 grantees, with share-based payment expenses of RMB 27,152,000 recognized for the period ending June 30, 2023[96] - The 2024 Share Award Plan granted a total of 7,006,454 shares to 23 grantees, with share-based payment expenses of RMB 13,808,000 recognized for the period ending June 30, 2024[97] - The fair value of the company's 5% equity in Spirejoy Pte. Ltd. increased to RMB 2,999,000 as of June 30, 2024, from RMB 1,499,000 as of December 31, 2023[99] - The fair value of the company's equity securities listed on the Shanghai Stock Exchange decreased to RMB 19,144,000 as of June 30, 2024, from RMB 34,819,000 as of December 31, 2023[99] - The fair value of the company's private equity funds increased to RMB 130,824,000 as of June 30, 2024, from RMB 62,599,000 as of December 31, 2023[99] - The company's 10% equity in a partnership investing in consumer, enterprise services, and entertainment sectors was valued at RMB 31,243,000 as of June 30, 2024, slightly down from RMB 31,532,000 as of December 31, 2023[99] - No gains or losses were recognized in other comprehensive income for unlisted equity instruments classified as fair value through other comprehensive income during the period ending June 30, 2024, compared to a loss of RMB 3,333,000 for the same period in 2023[101] - Total revenue for the six months ended June 30, 2024, reached RMB 127,215 thousand, compared to RMB 38,615 thousand in the same period in 2023, representing a significant increase[103] - Advertising and promotion services revenue from Guangzhou Keyang amounted to RMB 56,145 thousand, a new addition compared to the previous year[103] - Game operation costs for Guangzhou Keyang were RMB 19,288 thousand, a new expense item for the period[103] - The company recorded a gain of RMB 9,032 thousand from the sale of assets, including mobile game R&D results and property, plant, and equipment, to Shenzhen Keyang[105] - Loans to associates increased to RMB 111,102 thousand as of June 30, 2024, up from RMB 80,000 thousand at the end of 2023[106] - Total compensation for key management personnel, including salaries, bonuses, and stock-based payments, was RMB 8,327 thousand for the six months ended June 30, 2024, down from RMB 30,786 thousand in the same period in 2023[108] - Mr. Wu Chengze holds a 33.80% equity interest in the company through his controlled entity, Wu Chengze Network Limited[110] - Wu Chengze Network Limited holds a beneficial interest of 33.80% in the company's shares, amounting to 433,842,000 shares[116] - Xiamen Challenger Venture Capital Partnership holds a controlled corporate interest of 5.52% in the company's shares, amounting to 70,840,000 shares[116] - Jiang Ming Kuan Network Limited holds a beneficial interest of 6.61% in the company's shares, amounting to 84,885,000 shares[116] - Zhang Na holds a beneficial interest of 5.25% in the company's shares, amounting to 67,414,500 shares, and a spousal interest of 5.31%, amounting to 68,112,838 shares[116] - The company's share incentive plan allows for the issuance of up to 10% of the total issued shares, which is 125,600,000 shares, or a higher limit as permitted by the stock exchange[119] - The total number of shares that can be issued upon the exercise of all options under the share incentive plan and other plans shall not exceed 30% of the total issued shares at any time[119] - The company's subsidiary, Hometown Interactive (Xiamen) Network Technology Co., Ltd., has a registered capital of RMB 10,000,000, with Wu Chengze holding a 100% interest through Jilin Yutai Network Technology Co., Ltd.[112][114] - Su Bo holds an 18.4% interest in Hometown Interactive (Xiamen) Network Technology Co., Ltd. through Jilin Yutai Network Technology Co., Ltd.[112] - The company's share incentive plan requires a payment of HKD 1.00 for the acceptance of granted options, which is non-refundable and not considered as part of the exercise price[119] - The company's share incentive plan stipulates that no further options can be granted to a qualified person if the total number of shares issued or to be issued exceeds 1% of the total issued shares, unless approved by shareholders at a general meeting[119] - No share options were granted/exercised/cancelled/expired under the share option plan as of June 30, 2024[120] - The share option plan has a remaining validity period of approximately 5 years as of June 30, 2024[120] - The company can grant up to 63,240,000 share options under the share option plan as of both January 1, 2024 and June 30, 2024[120] - The share incentive plan has a remaining validity period of approximately 4 years and 10 months as of June 30, 2024[122] - The maximum number of new shares that can be issued under the share incentive plan in any fiscal year is 3% of the total issued shares[122] - The maximum number of new shares that can be issued to selected participants under the share incentive plan in any 12-month period is 1% of the total issued shares[122] - The company did not grant any share options or share incentives that required the issuance of new shares in the six months ended June 30, 2024[123] - As of December 31, 2022, the total number of unvested share incentives under the share incentive plan was 13,038,000[124] - In 2022, the company granted a total of 49,345,449 share incentives under the share incentive plan[124] - The share incentives granted in 2022 had a vesting period from April