Investment Rating - The investment rating for the media industry is "Positive (Maintain)" [1] Core Insights - The report emphasizes the strong performance of leading mobile games in overseas markets, with notable revenue increases and new game launches driving industry growth [3][29] - The integration of AI in content creation, particularly in AI-generated comics and advertising, is highlighted as a key area for investment, with significant advancements in domestic AI models [3][29] - The report suggests a continued focus on high-growth areas such as AI applications, gaming, and IP collaborations, recommending specific companies for investment [3][29] Industry Data Overview - The game "Delta Force" ranked first in the iOS free game chart in mainland China, while "Honor of Kings" topped the iOS revenue chart [9][13] - The film "Predator: Hunting Grounds" achieved the highest box office for the week, grossing 0.36 billion [25][29] Industry News Summary - OpenAI has reached 1 billion monthly active users, enhancing its product distribution capabilities [25] - The gaming market saw continued growth in October, with Bilibili's game "Escape from Duckkov" surpassing 3 million in sales [29] - The report notes the ongoing high growth in the comic market, with significant collaborations involving popular artists [25][29] Company Performance - Heartbeat Company saw a 30% increase in global revenue in October, with its game "Etheria: Restart" contributing significantly [3][29] - Century Huatong's games "Whiteout Survival" and "Kingshot" also reported strong revenue growth, with a 6% increase in October [3][29] - Bilibili's self-developed game "Escape from Duckkov" achieved sales of over 3 million copies [3][29]

Investment Rating - The report suggests a focus on cloud vendors and companies with exceeding expectations in the current market environment [3]. Core Insights - The report highlights a divergence in market performance, with consumer companies facing pressure while AI technology companies continue to show mixed results. Concerns about AI valuation bubbles persist, but leading tech companies like Microsoft, Google, and Meta maintain strong cash flows, suggesting a stable outlook for cloud vendors [3]. - The gaming demand remains robust, although there is a short-term lack of new game releases. Attention is drawn to the progress of key game tests and launches, which could drive revenue growth for related companies [3]. - The report emphasizes the importance of monitoring quarterly reports from major Chinese companies like Tencent, JD, Baidu, and Alibaba, as well as the ongoing value in sectors like PDD and the gaming industry [3]. Summary by Sections 1.1 Consumer & Internet - **Education**: The education index fell by 3.59%, with notable performance differences among companies. The implementation of a spring and autumn break system in Sichuan is expected to impact the sector positively [11][18]. - **Luxury & Gaming**: The luxury goods and gaming sectors are closely tied to macroeconomic conditions. Recent Q3 earnings from major gaming companies exceeded expectations, benefiting from a longer holiday schedule in 2026 [19][24]. - **Coffee & Tea**: The coffee sector remains vibrant, while the tea sector faces challenges due to reduced delivery platform subsidies and seasonal competition [3][27]. - **E-commerce**: The e-commerce sector is under pressure, with a lackluster performance during the Double Eleven shopping festival [3][35]. 1.2 Platform & Technology - **Streaming Platforms**: The streaming sector is driven by domestic demand, with platforms like Spotify reporting better-than-expected earnings [3][42]. - **Virtual Assets & Internet Brokers**: The cryptocurrency market is experiencing volatility, with a significant drop in global market value. However, there are potential buying opportunities following recent corrections [3][43]. - **Automotive Services**: The automotive aftermarket is projected to decline, with a year-over-year decrease of 4% expected by October 2025 [3][61]. 1.3 Media - The media sector is experiencing mixed performance, with streaming services facing challenges but also opportunities for growth through strategic partnerships and content offerings [3][41].

Game Releases - The mobile RPG "Black Clover: Path of the Magic Emperor" was officially launched on November 6, featuring a 3D world based on the anime and allowing players to experience Asta's journey alongside popular characters [1] - MiHoYo's first life simulation game "Starry Valley" began its "habitable test" on November 7, allowing players to engage in activities like planting and fishing across different planets [3] Industry Developments - The DLC for "Elden Ring: Night's Fall" is currently in development and is expected to be released in the fiscal year 2025, with performance exceeding initial expectations [6] - The 2025 KPL Grand Finals set a new record for the highest attendance at an esports event, with 62,196 attendees, as Chengdu AG Super Play Team claimed the championship [8] Company News - Rockstar Games announced a delay for "GTA VI," pushing the release date from May 26, 2026, to November 19, 2026, which caused a nearly 10% drop in its parent company Take-Two's stock price [11] - Chen Rui stepped down as General Manager and CFO of Shanghai Bilibili Technology, with the company stating that this change is a normal adjustment and does not affect his role as Chairman and CEO [13] Market Performance - In Q3 2025, China's gaming market generated actual sales revenue of 880.26 billion yuan, reflecting a quarter-on-quarter growth of 6.96%, with leading companies like Kaixin Network and Giant Network reporting net profits exceeding 500 million yuan and growth rates above 35% [15]

Market Overview - On November 7, the gaming sector declined by 0.97% compared to the previous trading day, with 37 Interactive Entertainment leading the drop [1] - The Shanghai Composite Index closed at 3997.56, down 0.25%, while the Shenzhen Component Index closed at 13404.06, down 0.36% [1] Individual Stock Performance - ST Huada (002602) rose by 2.01% to a closing price of 18.29, with a trading volume of 995,300 shares and a turnover of 1.8 billion yuan [1] - 37 Interactive Entertainment (002555) fell by 3.42% to a closing price of 22.00, with a trading volume of 695,700 shares and a turnover of 1.542 billion yuan [2] - Perfect World (002624) decreased by 2.85% to 16.01, with a trading volume of 425,200 shares and a turnover of 687 million yuan [2] Capital Flow Analysis - The gaming sector experienced a net outflow of 999 million yuan from main funds, while retail investors saw a net inflow of 760 million yuan [2][3] - ST Huada had a main fund net inflow of 14.7 million yuan, while 37 Interactive Entertainment saw a net outflow of 270 million yuan [3] ETF Performance - The Gaming ETF (159869) tracking the China Animation and Gaming Index fell by 1.49% over the past five days, with a net outflow of 51.09 million yuan [5] - The Food and Beverage ETF (515170) saw a slight decline of 0.17%, with a net inflow of 10.36 million yuan [5]

Investment Rating - The report maintains an "Outperform" rating for the media industry [2] Core Insights - The media sector has shown significant growth in Q3 2025, with public funds increasing their allocation to the sector, reaching a five-year high in both holding scale and allocation ratio [5][8] - The report highlights the strong performance of the gaming industry, AI applications, state-owned educational publishing companies, and leading advertising media companies as key areas of investment focus [5][8] Summary by Sections 1. Q3 Performance Overview: Record Revenue and Significant Profit Recovery - In the first three quarters of 2025, the media sector's total revenue reached CNY 416.065 billion, a year-on-year increase of 4.98%, while net profit attributable to shareholders was CNY 32.891 billion, up 40.23% [8][13] - Q3 alone saw revenue of CNY 143.178 billion, a year-on-year increase of 8.41%, and net profit of CNY 10.617 billion, up 44.74% [8][13] 2. Subsector Performance: Notable Industry Divergence, Strong Growth in Gaming - The gaming sector demonstrated high market vitality, with revenue of CNY 74.788 billion in the first three quarters, a 25.92% increase year-on-year, and net profit of CNY 13.475 billion, up 82.32% [30][32] - The film sector's revenue increased by 10.52% year-on-year to CNY 26.265 billion, while net profit surged by 482.33% to CNY 1.826 billion [50] - The publishing sector faced a revenue decline of 7.10% to CNY 97.600 billion, but net profit increased by 15.43% to CNY 11.421 billion, largely due to tax policy impacts [80][86] 3. Fund Holding Changes: Significant Increase in Sector Allocation, Favoring Gaming Companies - Public funds' total market value of heavy holdings in the media sector reached CNY 59.394 billion in Q3 2025, a 63.43% increase from Q2 2025 [5][95] - The gaming sector received the most attention, with heavy holdings amounting to CNY 43.546 billion, representing 73.32% of the total media sector holdings [5][95] 4. Investment Recommendations - The report suggests focusing on sectors with high industry vitality, such as gaming and AI applications, as well as state-owned educational publishing companies with defensive value characteristics [5][8]

Core Viewpoint - The China Securities 1000 Growth ETF (562520) opened down 0.54% at 1.298 yuan, reflecting a decline in several of its major holdings [1] Group 1: ETF Performance - The China Securities 1000 Growth ETF (562520) has a performance benchmark of the China Securities Select 1000 Growth Innovation Strategy Index [1] - Since its inception on March 8, 2022, the fund has returned 30.60%, while its return over the past month is -1.32% [1] Group 2: Major Holdings Performance - Key stocks in the ETF include: - Jucheng Co., Ltd. down 2.51% - Gylon Electronics down 0.96% - Gibit down 0.45% - Guangku Technology down 1.82% - Srypu down 1.34% - Lexin Technology down 0.91% - Huatu Shanding up 0.07% - Yuanjie Technology down 2.68% - Weimaisi up 0.17% - Anji Technology down 1.39% [1]

Investment Rating - The report rates the media industry as "Buy" [1] Core Insights - The media industry experienced significant revenue and profit growth in Q3 2025, with a revenue of 135.21 billion yuan, up 8.6% year-on-year, and a net profit of 10.4 billion yuan, up 43.7% year-on-year. The gaming sector was a major driver, with a net profit growth of 111% [2][11] - The report highlights the positive impact of AI technology on new formats such as animated dramas and short dramas, which are expected to enhance efficiency and drive growth [2][65] Summary by Sections Investment Recommendations - The gaming sector is highlighted for its high growth potential, with Q3 2025 revenue reaching 33 billion yuan, a 27.1% increase year-on-year, and a net profit of 5.88 billion yuan, reflecting a profit margin of 17.8%. Key companies recommended include Kayi Network, Giant Network, and Jibite [8][20][27] - The report suggests focusing on the IP and film sectors, which are recovering from a low base, with recommendations for Mango Super Media and Shanghai Film, particularly in the context of AI-driven innovations [8][54][64] - The publishing sector is noted for its stability, with a recommendation for state-owned publishing companies due to their strong cash reserves and high dividend yields [9][48] Q3 2025 Overview - The media sector's revenue and profit growth is attributed to the gaming sector's performance, with significant contributions from companies like ST Huatuo and Jibite [11][14] - The publishing sector saw a revenue decline of 5.1% but managed to achieve a net profit increase of 27.9% due to favorable tax policies [39][44] Gaming Sector - The gaming industry is experiencing a favorable supply-demand structure, with a notable increase in the number of domestic game licenses issued, reaching a total of 1,354 licenses in 2025 [20][28] - The report emphasizes the strong performance of leading gaming companies, with significant year-on-year growth in both revenue and net profit [27][31] IP and Film Sector - The film sector's revenue in Q3 2025 was 28.59 billion yuan, a decrease of 5.1%, but net profit surged by 936.3% due to improved box office performance [54][58] - The report highlights the potential of AI technologies in transforming the film industry, particularly in production efficiency and IP monetization [65] Marketing Sector - The marketing sector achieved a revenue of 47.16 billion yuan, up 7.6% year-on-year, with notable growth from leading companies like Yidian Tianxia [66]

Core Viewpoint - The report from Zheshang Securities highlights that JiBit's Q3 revenue reached 1.968 billion (YOY +129.19%) and net profit attributable to the parent company was 569 million (YOY +307.70%) driven by the strong performance of "The Legend of the Staff" and the potential of new SLG games [1] Financial Performance - JiBit's Q3 revenue was 1.968 billion, reflecting a year-over-year increase of 129.19% [1] - The net profit attributable to the parent company for Q3 was 569 million, showing a year-over-year growth of 307.70% [1] Game Performance - The success of "The Legend of the Staff" significantly contributed to the revenue and profit growth [1] - There is a focus on the potential of new SLG games, indicating a strategic interest in expanding this segment [1]

Core Insights - The report from Guohai Securities indicates that Jibite's net profit attributable to shareholders for Q1 to Q3 of 2025 reached 1.214 billion yuan, representing a year-on-year increase of 84.66% [1] - In Q3 alone, the net profit attributable to shareholders was 569 million yuan, showing a year-on-year growth of 307.70% and a quarter-on-quarter increase of 57.58% [1] - The company's performance is at the upper end of its forecast, with a focus on the launch of new products in different regions [1] Financial Performance - As of the end of Q3 2025, the company had an unamortized balance of recharge and in-game items totaling 635 million yuan, an increase of 157 million yuan from the end of 2024 [1] - This increase is primarily due to the new product launches in 2025, including "Legend of the Staff (Mainland Version)," "Treasure Hunter," "Legend of the Staff (Overseas Version)," and "Sword of Immortality (Mainland Version)" [1] Product Development and Future Outlook - The company has a rich product matrix, and with the upcoming launches in Q4 2025 and 2026, including "Sword of Immortality" in Hong Kong, Macau, Taiwan, and South Korea, as well as "Legend of the Staff" in overseas regions, profit contributions are expected to increase [1] - The already launched product "Legend of the Staff" is anticipated to contribute to revenue throughout 2026, which is expected to enhance the company's operating profit year-on-year [1] Revenue and Profit Projections - The projected operating revenue for the company from 2025 to 2027 is 6.187 billion yuan, 6.805 billion yuan, and 7.214 billion yuan, respectively [1] - The net profit attributable to shareholders is expected to be 1.695 billion yuan, 2.028 billion yuan, and 2.287 billion yuan for the same period, with corresponding price-to-earnings ratios of 19.21x, 16.06x, and 14.24x [1] - The rating for the company is maintained at "Buy" [1]

Key Insights - The report highlights significant year-on-year revenue growth in Q3, driven by advancements in the semiconductor and AR/VR testing sectors, particularly for companies like Maolai Optics and Junsheng Electronics [4][7] - Companies such as Amazon and Yudong Network have shown resilience in their revenue streams, with Amazon's Q3 revenue reaching $180.2 billion, a 13% increase year-on-year, and Yudong Network's revenue growing by 84.04% in the same period [21][27] - The report indicates a structural shift in the secondary market, with new infrastructure sectors experiencing a favorable market environment despite overall market pressure [18] Group 1: Company Performance - Maolai Optics reported a revenue of 503 million yuan in the first three quarters of 2025, a 34.05% increase year-on-year, with a net profit of 46 million yuan, up 86.57% [4] - Junsheng Electronics achieved a revenue of approximately 154.97 billion yuan in Q3 2025, reflecting a 10.25% year-on-year increase, with a net profit of about 4.13 billion yuan, up 35.4% [7] - Concept Electronics reported a net profit increase of 173.46% year-on-year, with a revenue of 315 million yuan in the first three quarters of 2025 [12] Group 2: Industry Trends - The semiconductor sector is experiencing robust growth, with Maolai Optics reporting that 58.80% of its revenue comes from this field [5] - The report notes a significant increase in new business orders for Junsheng Electronics, with a total of 714 billion yuan in new orders accumulated in the first three quarters of 2025 [9] - The e-commerce sector, particularly Amazon, continues to show resilience, with various revenue streams exceeding expectations, including a 24% increase in advertising service revenue [23][24] Group 3: Future Outlook - Forecasts for Maolai Optics suggest revenues of 673 million yuan, 871 million yuan, and 1.07 billion yuan for 2025-2027, with corresponding net profits of 63 million yuan, 97 million yuan, and 139 million yuan [6] - Junsheng Electronics is expected to achieve revenues of 625.64 billion yuan, 673.16 billion yuan, and 726.56 billion yuan from 2025 to 2027, with net profits projected at 15.39 billion yuan, 18.54 billion yuan, and 21.65 billion yuan [11] - Amazon's revenue is projected to reach $711 billion, $800 billion, and $900 billion for 2025-2027, with net profits of $76.5 billion, $87.9 billion, and $108.9 billion [26]