Investment Rating - The report maintains a "Positive" investment rating for the communication industry [9]. Core Insights - The communication sector saw a 3.65% increase in the 49th week of 2025, ranking 3rd among major industries, and a 70.43% increase since the beginning of the year, ranking 2nd [2][4]. - AWS launched the Trainium 3 chip, significantly enhancing performance and energy efficiency, while DeepSeek V3.2 made breakthroughs in inference capabilities and cost reduction for long sequences [2][5][6]. - The collaboration between AWS and NVIDIA is expected to accelerate the integration of self-developed chips with the NVIDIA ecosystem, clarifying the ASIC penetration logic [7]. Summary by Sections Market Performance - The communication sector's performance in the 49th week of 2025 was a 3.65% increase, with a year-to-date increase of 70.43% [2][4]. - Top gainers in the sector included Tianfu Communication (+25.8%), Tongyu Communication (+23.9%), and Meige Intelligent (+13.7%), while the largest declines were seen in Online and Offline (-11.8%), Data Port (-10.8%), and Kesi Technology (-8.6%) [4]. Technological Developments - AWS's Trainium 3 chip offers a 4.4x performance increase and a 40% improvement in energy efficiency, reducing training costs for clients by up to 50% [5]. - DeepSeek V3.2, the first open-source model to integrate "deep thinking" and "tool invocation," surpassed GPT-5 in inference benchmarks, significantly lowering costs for long sequence tasks [6]. Investment Recommendations - Recommended companies include China Mobile, China Telecom, and China Unicom in the operator category; Zhongji Xuchuang, Xinyi Sheng, and Tianfu Communication in optical modules; and AI applications such as Boshi Jie, Heertai, and Tuobang Co. [7].

Core Insights - The AI mobile phone concept is gaining traction, with companies like Shenghong Technology and Furong Technology seeing significant stock price increases following the announcement of the open-sourcing of the AutoGLM AI model by Zhiyu Technology [1][2] Industry Developments - Zhiyu Technology has open-sourced its AutoGLM model, which is recognized as the world's first AI agent capable of mobile operations, enabling complex tasks like food ordering and flight booking [1][2] - The open-sourcing of AutoGLM is expected to lower the technical barriers for AI mobile phones, transitioning the ecosystem from a closed to an open collaborative model [1][2] - The project supports both local and cloud deployment, ensuring users maintain control over their data and privacy [1][2] Market Trends - The AI mobile phone sector is witnessing significant interest from major players, with the recent collaboration between Douyin's AI assistant "Doubao" and ZTE marking a substantial step in the integration of AI models with mobile hardware [2][3] - AI mobile phones are moving from concept to real-world applications, capable of automating tasks in various scenarios such as food delivery and customer service [2][3] Future Outlook - Citic Securities predicts that AI mobile phones will be a major transformation in the industry, with expectations for the launch of AI phones equipped with advanced capabilities by the end of 2025 [3] - The Chinese government's policies are increasingly supportive of AI mobile technology, aiming to foster a comprehensive ecosystem for smart products [3][4] - Experts believe that the continuous breakthroughs in core technologies will unlock significant market potential, driving the evolution of consumer electronics from tools to intelligent partners [4]

Core Insights - The Terahertz concept sector experienced a 1.14% increase, ranking fourth among concept sectors, with 10 stocks rising, including Shaanxi Huada and Leike Defense hitting the daily limit up of 20% [1] - The sector saw a net inflow of 721 million yuan from main funds, with Leike Defense leading the inflow at 929 million yuan [2][3] Sector Performance - The Terahertz concept was among the top-performing sectors, with notable stocks like Shaanxi Huada (20% increase), Leike Defense (10.01% increase), and Saiwei Electronics (2.74% increase) [1][2] - Conversely, stocks such as Chuangyuan Xinke, Yaguang Technology, and Tianhe Defense faced declines of 3.08%, 2.59%, and 2.14% respectively [1] Fund Flow Analysis - Leike Defense, Shaanxi Huada, and Haige Communication had the highest net inflow ratios at 15.35%, 11.20%, and 3.25% respectively [3][4] - The overall net inflow for the Terahertz concept was significant, with eight stocks receiving inflows, and five stocks exceeding 50 million yuan in net inflow [2][3]

Core Viewpoint - BlackRock's long position in ZTE Corporation's H-shares increased from 6.79% to 7.18% as of December 4, 2025 [1] Group 1 - BlackRock's holding in ZTE Corporation reflects a growing confidence in the company's performance [1] - The increase in holdings indicates potential positive sentiment towards ZTE's future prospects [1]

Group 1 - BlackRock's stake in ZTE Corporation's H-shares increased from 6.79% to 7.18% as of December 4 [1]

Core Viewpoint - The collaboration between Doubao and ZTE to launch an AI phone assistant signifies the beginning of a transformative era driven by AI, addressing real user demands [1] Group 1: AI Transformation - The essence of the AI assistant is that the device owner authorizes the assistant to perform operations, which falls within the legal and compliant use of data [1] - The technology that allows for automatic ride-hailing, previously seen only in films, is now technically feasible [1] Group 2: User Authorization and Privacy - With the owner's authorization, the phone assistant can execute tasks by accessing various applications and data, including location, ride-hailing software, navigation, traffic information, and payment [1] - The process is fundamentally about the "owner" authorizing the "assistant" to perform actions, which does not relate to invasion, hacking, or privacy violations [1] - As long as user consent is obtained, there is no infringement on privacy [1]

Core Viewpoint - The collaboration between Doubao and ZTE to launch an AI phone assistant signifies a transformative shift driven by AI technology, addressing real user demands and marking the beginning of a new era in mobile automation [1]. Group 1: AI Phone Assistant Development - Doubao's AI phone assistant can automate complex tasks, such as booking a ride, by utilizing various applications and data with user authorization, ensuring compliance with data usage regulations [1]. - The assistant's capabilities are highlighted through practical examples, demonstrating that what was once only seen in movies is now technically feasible [1]. - The development of the AI assistant is still in the exploratory phase and is not yet available to the general public, adhering to high industry compliance standards [1]. Group 2: Privacy and User Authorization - Concerns regarding privacy and unauthorized access have been addressed, with Doubao emphasizing that all operations require explicit user consent, as outlined in their privacy policy [1][2]. - The necessity of user permission for accessing information, such as location and contacts, is underscored, reinforcing that privacy infringement does not occur when users grant access [2].

Core Viewpoint - The collaboration between ZTE and Douyin on the Nubia M153 smartphone assistant has sparked discussions about the role of AI in the mobile industry, emphasizing that AI is a transformative force that addresses real user needs [1][4]. Group 1: Company Initiatives - ZTE's Nubia has been focusing on AI since 2017, aiming to make AI accessible to everyone, not just a select few [4]. - The partnership with Douyin is seen as a strategic move to enhance user experience through innovation, reflecting a commitment to open collaboration [4][5]. - The Nubia M153 smartphone is part of a broader strategy that includes the development of AI capabilities and a multi-model collaborative approach by 2025 [4]. Group 2: Industry Trends - The smartphone industry has not seen significant disruptive innovations for a long time, and the integration of AI is viewed as a necessary evolution [4]. - The collaboration is positioned as a response to the changing landscape of user expectations and technological advancements, with a focus on improving product experiences [4][5]. - The sentiment expressed by Douyin's executive highlights the belief that AI will play a crucial role in the future of technology and user engagement [1].

Core Insights - Nubia Technology's president Ni Fei acknowledged receiving feedback and is actively communicating with partners to address issues [1] - Douyin Group's vice president Li Liang emphasized the real transformation brought by AI and the genuine demand from users, indicating that the exploration by Doubao and ZTE is just the beginning, regardless of the outcome [1] Company Developments - Nubia Technology is in the process of resolving issues raised by users and partners, indicating a proactive approach to feedback [1] - Douyin Group is recognizing the impact of AI on user needs and market trends, suggesting a strategic focus on AI integration in future developments [1] Industry Trends - The statement from Douyin Group highlights a broader industry acknowledgment of AI's transformative potential, suggesting that companies are increasingly prioritizing AI in their strategies [1] - The exploration efforts by Doubao and ZTE are positioned as initial steps in a larger trend towards AI adoption within the industry [1]

Strategy - The technology competition under the Kondratiev wave continues to open up valuation ceilings, with a focus on "bottleneck" and future industry high ground [14][15] - The current valuation of China's science and technology innovation is still lower than that during the internet boom in the 1990s, indicating potential for further upward movement [14][18] - The "14th Five-Year Plan" emphasizes seizing the high ground of technological development, focusing on key areas such as integrated circuits and advanced manufacturing [14][19] Electronics - The scaling law remains effective, with the introduction of multi-modal and agent models expected to accelerate AI computing demand [8][15] - The PCB industry is anticipated to maintain high growth due to its heavy asset nature and product structure optimization, which can lead to non-linear performance improvements for companies [8][15] Computer - New models are being launched intensively, marking a shift in AI competition towards "strong reasoning + native multi-modal" capabilities [9][15] - Significant releases include Google's Gemini 3 and DeepSeek V3.2, which enhance multi-modal understanding and practical applications [9][15] Media - Long-term optimism for the acceleration of AI product applications and commercialization, with a focus on AI agents, companionship, multi-modal applications, education, and edge AI [9][15] Humanoid Robots - The industry is transitioning from concept validation to commercialization, with companies that have growth potential in key components or specific solutions likely to benefit [10][15] - Investment opportunities are identified in the incremental component sector, with a focus on aesthetic preferences in the market [10][15] Automotive - The launch of Horizon Robotics' HSD and J6P models marks a significant step in mass production, with companies like WeRide and Pony.ai also making strides in the market [10][15] - Recommendations include focusing on luxury car opportunities with strong product pipelines and valuation elasticity, as well as autonomous driving technologies [10][15] Selected Portfolio - The December selected portfolio includes upstream production tools like Zhuoyi Information, upstream computing infrastructure such as Jingwang Electronics, and downstream applications like Alibaba [11][15]