Core Viewpoint - Midea Group is actively addressing the impact of rising commodity prices, particularly copper, through various strategic measures [1] Group 1: Business Expansion - The company operates in over 200 countries and regions, with 22 R&D centers and 41 major manufacturing bases across more than a dozen countries [1] - Midea Group plans to continue expanding its overseas manufacturing footprint and promote the construction and operation of new overseas factories [1] Group 2: Response to Commodity Price Fluctuations - To mitigate the effects of raw material price volatility, the company will implement product structure upgrades, enhance efficiency across the entire value chain, and optimize supply chain management [1] - Midea Group engages in bulk hedging to manage the price fluctuations of raw materials and utilizes centralized procurement to gain relative price advantages [1]

Financial Performance - The total revenue for the year-to-date period reached 364.7 billion CNY, representing a year-on-year growth of approximately 14% [2] - The net profit attributable to the parent company was 37.9 billion CNY, with a growth rate of 20% [2] - The revenue from the three major ToB segments is as follows: - New Energy and Industrial Technology: 30.6 billion CNY, a year-on-year increase of 21% [3] - Smart Building Technology: 28.1 billion CNY, a year-on-year increase of 25% [3] - Robotics and Automation: 22.6 billion CNY, a year-on-year increase of 9% [3] Energy Storage and AI Strategy - The company launched its energy strategy focusing on "Energy Storage + Heat Pump + AI" [3] - The new Aqua-C3.0 Pro liquid cooling energy storage system was unveiled, reducing total ownership costs by 10.63% [3] - The ultra-high temperature industrial heat pump can achieve 130°C, with a COP of up to 4.2, promoting energy savings [3] - The Energy+ platform has integrated over 1.5 GW of distributed photovoltaic systems, achieving a price forecast accuracy of 92% and load prediction accuracy of 97% [3] Robotics Development - The company introduced a robotics strategy focusing on AI + Robotics, humanoid robot development, and core components [4] - At the 2025 Shanghai Industrial Expo, KUKA showcased five strategic intelligent products, marking a new phase in intelligent manufacturing [4] - The humanoid robot "Mei Luo" is now operational in the company's washing machine factory, performing various tasks [5] - The core components for robotics, such as harmonic reducers, have a production capacity of 80,000 units by the end of 2024 [5] Supply Chain and Commodity Price Management - The company operates in over 200 countries and regions, with 22 R&D centers and major manufacturing bases in more than ten countries [5] - To mitigate the impact of commodity price fluctuations, the company is enhancing product structure, optimizing supply chain management, and implementing bulk purchasing strategies [5] - Copper prices increased by approximately 40% year-on-year, but the company's net profit margin has rebounded since 2022 [5] - The company aims to deepen DTC reforms to achieve cost reduction and efficiency improvement [5]

Core Viewpoint - Midea Group announced a share buyback plan, investing 99.9971 million yuan to repurchase 1.3244 million A-shares, scheduled for November 3, 2025 [1] Company Summary - The total amount allocated for the share buyback is 99.9971 million yuan [1] - The number of A-shares to be repurchased is 1.3244 million [1] - The buyback is set to take place on November 3, 2025 [1]

Investment Rating - The investment rating for Midea Group is "Outperform the Market" [5] Core Views - Midea Group demonstrated resilient growth in operating performance, with revenue for Q1-Q3 2025 reaching 364.72 billion, a year-on-year increase of 13.8%, and net profit attributable to shareholders at 37.88 billion, up 19.5% [1] - The company's B-end and OBM (Original Brand Manufacturer) businesses continue to drive growth momentum, with B-end revenue increasing by 18% in the first three quarters [2] - The gross margin has improved, with Q3 gross margin rising by 1.2 percentage points to 26.4%, ending a four-quarter decline [3] Summary by Sections Revenue and Profitability - For Q3 2025, Midea Group achieved revenue of 112.38 billion, a 9.9% increase year-on-year, and net profit of 11.87 billion, up 8.9% [1] - The company’s C-end appliance business grew by 13% year-on-year in the first three quarters, showcasing strong operational capabilities despite market pressures [2] B-end Business Performance - The B-end business revenue grew by 18% in the first three quarters, with significant contributions from new energy and industrial technology, intelligent building technology, and robotics and automation [2] Financial Metrics - The company’s Q3 net profit margin was 10.6%, maintaining a solid profitability level [3] - The forecast for net profit attributable to shareholders for 2025-2027 is adjusted to 44.9 billion, 49.4 billion, and 54 billion respectively, reflecting a year-on-year growth of 16%, 10%, and 9% [4][5]

Market Overview - The Shanghai Composite Index rose by 0.55% on November 3, with 22 industries experiencing gains, led by Media and Coal, which increased by 3.12% and 2.52% respectively [1] - The market saw a net outflow of 23.944 billion yuan in major funds, with 9 industries recording net inflows, primarily in the Media sector, which attracted 2.031 billion yuan [1] Industry Performance - The Household Appliances industry declined by 0.66%, with a net outflow of 900 million yuan in major funds [2] - Within the Household Appliances sector, 94 stocks were tracked, with 65 rising and 28 falling; 4 stocks hit the daily limit up [2] - The top three stocks with the highest net outflow in the Household Appliances sector were Sanhua Intelligent Controls, Gree Electric Appliances, and Midea Group, with outflows of 520 million yuan, 315 million yuan, and 153 million yuan respectively [2] Fund Flow Analysis - The top inflow stock in the Household Appliances sector was Kangsheng Co., with a net inflow of 2.42 billion yuan, followed by Sichuan Changhong and Lidasin with inflows of 904.55 million yuan and 552.87 million yuan respectively [2][5] - The overall fund flow data indicates that 43 stocks in the Household Appliances sector had net inflows, while 6 stocks experienced outflows exceeding 500 million yuan [2] Key Stock Movements - Notable stock movements included Kangsheng Co. with a 10.11% increase, and Sichuan Changhong with a 1.47% rise [5] - The stock with the largest decline in the Household Appliances sector was Haier Smart Home, which fell by 0.34% [2]

Core Insights - The inclusion of "embodied intelligence" and "intelligent robots" in the 2025 government work report signifies the formal recognition of cutting-edge technology as a national strategy [1] - Foshan has introduced a series of new policies aimed at establishing the intelligent robot industry as a new engine for high-quality development and a new pillar of the economy [1] - The focus on self-controllable core components is a critical battle for the industry, highlighted by Midea Group's recent advancements in localizing core robot technologies [1] Group 1 - Midea's Central Research Institute has developed a servo motor design platform from scratch, overcoming initial challenges and breaking international technology monopolies [3][5] - The success of the KUKA China project, which integrates local core components into heavy-duty robots, marks a significant milestone in Midea's vertical integration strategy [5][9] - Midea's robot and automation business reported a 9% year-on-year revenue increase, reflecting a strategic focus on industrial robot intelligence, home appliance robotics, and humanoid robot value [5][9] Group 2 - The development of servo motors involved extensive trial and error, requiring a system-level approach to address issues beyond the motor itself [7][8] - A pivotal decision was made to abandon a conventional design in favor of a new structure, demonstrating the team's innovative capabilities and commitment to high standards [8][9] - The establishment of the Blue Orange Laboratory, a key national laboratory supported by a private enterprise, has achieved significant advancements in critical technologies, further enhancing Midea's position in the industry [9] Group 3 - The collaborative efforts within the Blue Orange Laboratory aim to consolidate domestic robot companies and enhance the overall technological capabilities of the industry [9] - The integration of AI technology into Midea's robotics applications is paving the way for deeper collaboration between intelligent systems and physical robots [9] - The ongoing efforts in core technology localization not only deepen Midea's vertical integration strategy but also lay a solid foundation for the safety and self-sufficiency of China's intelligent robot industry [9]

Investment Rating - The investment rating for Midea Group is "Outperform the Market" [5] Core Views - Midea Group demonstrated resilient growth in operating performance, with revenue for Q1-Q3 2025 reaching 364.72 billion, a year-on-year increase of 13.8%, and net profit attributable to shareholders at 37.88 billion, up 19.5% [1] - The company's B-end and OBM (Original Brand Manufacturer) businesses continue to drive growth momentum, with B-end revenue increasing by 18% in the first three quarters [2] - The gross margin has improved, with Q3 gross margin rising by 1.2 percentage points to 26.4%, ending a four-quarter decline [3] Summary by Sections Revenue and Profitability - For Q3 2025, Midea Group reported revenue of 112.38 billion, a 9.9% increase year-on-year, and net profit of 11.87 billion, up 8.9% [1] - The company expects a 10% growth in C-end home appliance business for Q3, showcasing strong operational capabilities despite market pressures [2] B-end Business Performance - The B-end business revenue grew by 18% in the first three quarters, with significant contributions from new energy and industrial technology, smart building technology, and robotics and automation [2] Financial Metrics - Midea Group's Q3 net profit margin was 10.6%, maintaining a solid profitability level [3] - The company has adjusted its profit forecast upwards, expecting net profits of 44.9 billion, 49.4 billion, and 54 billion for 2025, 2026, and 2027 respectively, reflecting year-on-year growth of 16%, 10%, and 9% [4]

Core Viewpoint - Midea Group announced a share buyback plan, intending to repurchase 1 billion RMB worth of A-shares, totaling 1.32 million shares at a price range of 75.19 to 76.89 RMB per share [1] Summary by Category Company Actions - Midea Group will spend 1 billion RMB to buy back 1.32 million A-shares [1] - The buyback price is set between 75.19 and 76.89 RMB per share [1]

Core Insights - Tengshi Automotive has announced a deep integration with Chemours Smart Home, allowing users to control smart home appliances from their Tengshi N8L vehicle and vice versa [2] - Midea Group is implementing a dual-brand strategy with COLMO and Midea to enhance home intelligence, focusing on the integration of people, vehicles, and homes to meet user needs across different spaces and scenarios [2] - Midea's General Manager of Whole Home Intelligence, Shang Zhe, highlighted that the growth of home intelligence is closely linked to the rise of smart vehicles, indicating a shift from mobile internet growth to smart automotive growth as a key driver [2]

Market Overview - The white goods sector experienced a decline of 0.85% on November 3, with Midea Group leading the drop [1] - The Shanghai Composite Index closed at 3976.52, up 0.55%, while the Shenzhen Component Index closed at 13404.06, up 0.19% [1] Individual Stock Performance - Aokema (600336) saw a closing price of 7.30, with an increase of 3.11% and a trading volume of 241,300 shares, totaling 174 million yuan [1] - TCL Smart Home (002668) closed at 11.03, up 1.29%, with a trading volume of 419,700 shares, amounting to 459 million yuan [1] - Midea Group (000333) closed at 75.39, down 1.32%, with a trading volume of 282,000 shares, totaling 2.132 billion yuan [1] Capital Flow Analysis - The white goods sector saw a net outflow of 559 million yuan from institutional investors, while retail investors contributed a net inflow of 510 million yuan [1] - Among individual stocks, Hisense Home Appliances (000921) experienced a net outflow of 35.42 million yuan from institutional investors [2] - Aokema (600336) had a net inflow of 17.79 million yuan from institutional investors, while retail investors contributed a net inflow of 4.70 million yuan [2]