Core Viewpoint - The company has shown a narrowing decline in revenue and net profit in Q3 2025, with strong performance from evergreen games like "Age of Origins" and "War and Order," and promising expectations for new games [1][2][3] Financial Performance - In Q3 2025, the company achieved revenue of 1.384 billion yuan, a year-on-year decrease of 5.29% - The net profit attributable to shareholders was 215 million yuan, down 53.55% year-on-year - The non-GAAP net profit attributable to shareholders was 208 million yuan, a decline of 3.20% year-on-year, indicating a smaller drop compared to revenue [2] - For the first three quarters of 2025, the cumulative revenue was 4.068 billion yuan, down 9.86% year-on-year, with a net profit of 724 million yuan, down 33.77% year-on-year [2] Game Performance - Evergreen games "Age of Origins" and "War and Order" have maintained stable performance, with "Age of Origins" undergoing frequent updates and events to enhance player engagement [3] - "War and Order" has also seen multiple updates to improve user experience, showcasing the company's long-term operational capabilities [3] - The new game "Stellar Sanctuary" has been launched, combining simulation management and SLG gameplay, with expectations for strong future performance [3] Future Outlook - The company anticipates steady revenue from its evergreen games and is optimistic about the performance of new releases [2][3] - EPS estimates for 2025-2027 are projected at 0.61, 0.84, and 1.01 yuan respectively, with a target price of 16.47 yuan based on a 27x dynamic PE for 2025 [2]

Core Viewpoint - Shenzhou Taiyue's stock price has shown fluctuations, with a recent increase of 2.03% to 12.04 CNY per share, while the company faces a decline in revenue and profit year-on-year [1][2]. Financial Performance - For the period from January to September 2025, Shenzhou Taiyue reported a revenue of 4.068 billion CNY, a year-on-year decrease of 9.86%, and a net profit attributable to shareholders of 724 million CNY, down 33.77% year-on-year [2]. - The company has cumulatively distributed dividends of 1.297 billion CNY since its A-share listing, with 372 million CNY distributed over the past three years [3]. Stock Market Activity - As of October 31, Shenzhou Taiyue's market capitalization stands at 23.685 billion CNY, with a trading volume of 113 million CNY and a turnover rate of 0.51% [1]. - The stock has increased by 4.79% year-to-date but has seen a decline of 1.63% over the last five trading days and 22.57% over the last 20 days [1]. Shareholder Information - As of October 20, the number of shareholders increased to 92,300, with an average of 19,985 circulating shares per shareholder, a decrease of 3.27% [2]. - The largest circulating shareholder is Huaxia Zhongzheng Animation Game ETF, holding 56.4599 million shares, an increase of 9.6514 million shares compared to the previous period [3].

Core Viewpoint - The company reported a significant decline in net profit for Q3 2025, primarily due to a high profit base from the previous quarter and a decrease in gaming revenue and net profit [1][3] Financial Performance - In Q3 2025, the company achieved operating revenue of 1.384 billion yuan, a year-on-year decrease of 5.29% and a quarter-on-quarter increase of 1.7% [1] - The net profit attributable to shareholders was 215 million yuan, down 53.55% year-on-year [1] - The non-recurring net profit was 208 million yuan, a year-on-year decrease of 3.20% and a quarter-on-quarter decrease of 20.6% [1] - For the first three quarters of 2025, the company reported total operating revenue of 4.068 billion yuan, a year-on-year decline of 9.86% [1] Gaming Business - Existing games like "Age of Origins" and "War and Order" have seen a decline in revenue but still show resilience [2] - The company has several new "SLG+X" products in the pipeline, including "DL" and "LOA," which have received approval for domestic release [2] - The revenue decline from new games is expected to impact short-term performance, but future product releases may drive growth [2] AI Product Development - The company launched the AI voice digital employee product OurWorks in July, targeting cost reduction for small and medium enterprises [3] - The product's international version was launched in October, focusing on B2B users, with revenue growth expected to develop over time [3] - Q4 is anticipated to see seasonal growth in the computer business, potentially improving overall revenue and profit [3] Profit Forecast and Valuation - The company has revised down its net profit forecasts for 2025-2027 to 960 million, 1.4 billion, and 1.61 billion yuan, reflecting a decrease of 16.46%, 17.92%, and 20.63% respectively [4] - Based on relative valuation, the target price for 2026 is set at 16.37 yuan, corresponding to a PE ratio of 23 times [4] - The company maintains a "buy" rating despite the adjustments in profit forecasts [4]

Investment Rating - The report maintains a "Buy" rating for the company with a target price of RMB 16.37 [7][5]. Core Views - The company is currently undergoing a critical transition between old and new growth drivers, with short-term performance under pressure but long-term potential in overseas SLG products and AI business commercialization [1][5]. - The existing games are experiencing a natural decline in revenue due to reduced marketing spend, but they still show strong resilience, with expectations of narrowing revenue decline in the upcoming quarters [2]. - The AI product OurWorks has been launched with a business model targeting cost reduction for SMEs, and while it is in the user accumulation phase, it is expected to contribute positively to revenue in the future [3]. Financial Performance Summary - In Q3 2025, the company reported revenue of RMB 1.384 billion, a year-on-year decrease of 5.29% but a quarter-on-quarter increase of 1.7%. The net profit attributable to shareholders was RMB 215 million, down 53.55% year-on-year [1]. - For the first three quarters of 2025, the company achieved a total revenue of RMB 4.068 billion, a year-on-year decline of 9.86%, and a net profit of RMB 724 million, down 33.77% year-on-year [1]. - The gross margin for Q3 2025 was 56.17%, a decrease of 5.02 percentage points year-on-year, primarily due to a lower proportion of high-margin game business [4]. Earnings Forecast and Valuation - The earnings forecast for 2025-2027 has been revised downwards, with net profit estimates adjusted to RMB 961.53 million, RMB 1.401 billion, and RMB 1.605 billion, representing declines of 16.46%, 17.92%, and 20.63% respectively [5][11]. - The company is assigned a PE valuation of 23 times for 2026, reflecting its potential for new product elasticity and rapid AI application progress [5].

Performance Overview - In the first three quarters of 2025, the company achieved revenue of 4.068 billion yuan, a year-over-year decrease of 9.86% [1] - The net profit attributable to the parent company was 724 million yuan, down 33.77% year-over-year [1] - The non-recurring net profit was 696 million yuan, a year-over-year decline of 16.42% [1] - In Q3 2025, the company reported revenue of 1.384 billion yuan, a year-over-year decrease of 5.29% [1] - The net profit attributable to the parent company for Q3 was 215 million yuan, down 53.55% year-over-year [1] - The non-recurring net profit for Q3 was 208 million yuan, a year-over-year decrease of 3.20% [1] Game Operations and New Releases - The company's existing games, "Age of Origins" and "War and Order," are operating stably [2] - The new game "Stellar Sanctuary" was launched overseas at the end of August, maintaining over 500 daily advertising placements in Europe, America, and Southeast Asia within two weeks [2] - "Next Agers" has been launched on Google Play and the App Store in the US [2] - Two additional new games are expected to launch domestically in the near future [2] AI Product Development - The company plans to test three SLG games in the first half of 2026 [3] - On June 10, the company launched the "Taiyue Lighthouse" AI model application capability system, which includes three AI products [3] - The key product, avavox, integrates a large model with over 200 industry templates to provide intelligent voice robot services for B-end users [3] - Avavox operates on a subscription-based revenue model, with a focus on customer subscription numbers and overall payment status [3] Investment Outlook - The company is projected to achieve net profits attributable to the parent company of 1.08 billion yuan, 1.3 billion yuan, and 1.38 billion yuan for the years 2025, 2026, and 2027, representing year-over-year changes of -24.3%, 20.2%, and 6.5% respectively [4] - Corresponding price-to-earnings ratios are expected to be 22.05, 18.34, and 17.22 for the respective years [4] - The long-term operation of core games is expected to continue providing performance growth, while the overseas launch of new games is anticipated to contribute to revenue increases [4]

Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company is expected to gradually reach an inflection point in performance driven by a new game cycle and AI commercialization [4] - Q3 revenue and net profit margins show signs of resilience despite previous declines, indicating potential for recovery [4] - The company has adjusted its product launch strategies and is seeing improved performance in core gaming products [4] Financial Summary - For Q1-Q3 2025, the company achieved revenue of 4.068 billion yuan, a year-on-year decrease of 9.86%, and a net profit of 724 million yuan, down 33.77% [4] - Q3 revenue was 1.384 billion yuan, with a year-on-year decline of 5.3%, while the net profit margin was 17.5%, down 6.5 percentage points [4] - The gross margin for Q1-Q3 2025 was 58.6%, a decrease of 3.4 percentage points year-on-year [4] Game Performance - The core games "Age of Origins" and "War and Order" have shown stable performance in the U.S. iOS market, with rankings improving over the months [5] - New SLG games "Stellar Sanctuary" and "Next Agers" are nearing commercialization, which is expected to contribute to revenue growth [5] AI Product Development - The company launched the intelligent voice robot avavox, which has significantly improved communication efficiency and reduced operational costs [6] - The global expansion of avavox is anticipated to provide additional revenue streams [6] Financial Projections - The company’s projected net profits for 2025, 2026, and 2027 are 1.154 billion yuan, 1.724 billion yuan, and 2.604 billion yuan respectively, with corresponding P/E ratios of 20.6, 13.8, and 9.1 [4][7] - Revenue is expected to decline in 2025 but rebound significantly in 2026 and 2027, with growth rates of 36.4% and 28.9% respectively [7]

Performance Overview - In Q1-Q3 2025, the company achieved operating revenue of 4.068 billion yuan, a year-on-year decline of 9.86% [1] - The net profit attributable to shareholders was 724 million yuan, down 33.77% year-on-year [1] - The net profit excluding non-recurring items was 696 million yuan, a decrease of 16.42% year-on-year [1] - In Q3 2025, the operating revenue was 1.384 billion yuan, a year-on-year decline of 5.29% [1] - The net profit attributable to shareholders in Q3 was 215 million yuan, down 53.55% year-on-year [1] - The net profit excluding non-recurring items in Q3 was 208 million yuan, a decrease of 3.20% year-on-year [1] Game Development and Strategy - The new game "Stellar Sanctuary" was launched on the US App Store, while existing games continue to undergo frequent iterations [2] - The company’s subsidiary, Shellwood Games, adheres to a "diversification + quality" strategy, continuously innovating in game themes and gameplay [2] - "Age of Origins" maintained high-frequency updates in Q3, introducing new systems and celebrating its seventh anniversary with various activities [2] - "War and Order" also received multiple updates to enhance user experience [2] - Both "Age of Origins" and "War and Order" ranked in the top 20 of the "2025 Q3 China Game Overseas Evergreen List" [2] - The company is actively integrating with the Hongmeng ecosystem, with two strategy games already adapted for the Hongmeng system [2] AI and Digital Solutions - The "Yueqing" large model passed authoritative testing by the China Academy of Information and Communications Technology, marking a significant breakthrough in AI technology integration [3] - The "Yueqing" model is built on the "Taiyue Lighthouse" AI model application capability system, featuring a dual-core intelligent agent collaborative architecture [3] - The company joined the "Agent Qizhi" application research promotion plan initiated by the China Academy of Information and Communications Technology [3] - The company launched the voice digital employee "avavox," which includes over 200 industry templates to enhance operational efficiency [4] - "avavox" can complete tasks in 10 minutes that would take human agents half a day, achieving a 95% accuracy rate in problem identification [4] - The new knowledge management agent "UltraTalk" integrates generative AI capabilities and is adaptable to various industry scenarios [4] Profit Forecast - Due to the current product launch being in the investment phase, the profit forecast has been adjusted [5] - The company is expected to achieve net profits attributable to shareholders of 1.015 billion, 1.250 billion, and 1.437 billion yuan for 2025-2027, with corresponding P/E ratios of 23, 19, and 16 times [5] - The investment rating is maintained as "Buy" [5]

Core Viewpoint - Dongwu Securities report indicates that Shenzhou Taiyue achieved a net profit attributable to shareholders of 210 million yuan in Q3 2025, representing a year-on-year decline of 53.6% and a quarter-on-quarter decline of 20.6%, aligning with market expectations [1] Group 1: Gaming Business - The existing games are performing steadily, with attention on the progress of new game launches [1] - The revenue from existing games is expected to stabilize, with the decline in revenue narrowing quarter-on-quarter in Q3 2025 [1] - New games "Stellar Sanctuary" and "Next Agers" were launched in overseas markets in early 2025 and are currently in the testing and adjustment phase, having received domestic game licenses [1] Group 2: Computer Business - The company is advancing productization and internationalization, with a focus on the implementation of avavox [1] - The ICT operational business contributed incremental revenue in Q3 2025 [1] - The company continues to promote the commercialization and implementation of AI technology across various business sectors [1] Group 3: Future Outlook - The company is optimistic about the performance elasticity following the launch of new games and the potential of its AI business, maintaining a "buy" rating [1]

Summary of Shenzhou Taiyue Conference Call Company Overview - **Company**: Shenzhou Taiyue - **Industry**: Gaming and Computer Services Key Points Financial Performance - In Q3, the company achieved a revenue of 8 billion yuan, a year-on-year decrease of 10% [3] - Cumulative revenue for the year to date is 4 billion yuan, indicating a trend of narrowing revenue decline [3] - The net profit after deducting non-recurring items shows a significant quarter-on-quarter narrowing, reflecting stable operational conditions [3] Performance of Existing Games - Q3 non-recurring profit mainly derived from existing games, with almost all profits coming from older titles [4] - Revenue from older games has shown a decreasing trend since last year, but the decline is narrowing each quarter, indicating good performance [4] New Product Development - Two new games, DL and LOV, are currently in testing and require modifications for optimization; the launch timeline remains unclear [5] - Three new SLG titles are progressing as per the planned schedule [5] Market Competition and Strategy - The overseas market is experiencing intense competition, but the performance of both new and existing games remains stable [8] - The company has a diversified product line, including light and casual games, which accounts for approximately 20% of its reserves [8] Game Project Evaluation - The company employs strict standards for evaluating and selecting game projects, focusing on long-term operational potential [9] - Non-SLG games have a low probability of successful project initiation due to these stringent criteria [9] Computer Business Outlook - Q4 is traditionally a peak season for the company's computer business, expected to continue the growth trend [10] - Cloud services and Xiaoman business are performing well, while the Arvox product is expected to show user growth but limited revenue contribution in the short term [10] Q4 Game Business Expectations - The game business in Q4 is expected to remain stable, primarily driven by revenue from older games, with no large-scale promotion of new titles anticipated [11] - The overall performance across both computer and gaming sectors is expected to be stable in Q4 [11] New Game Launch Strategy - The domestic launch of new games typically follows the overseas launch schedule, with plans to promote in China approximately six months after the North American launch [12] - The three upcoming new games are still under production, and their performance predictions remain uncertain [12] Arvox Product Update - Arvox was launched in late July and has seen a steady increase in user numbers, although specific data has not been disclosed [13] - As a small B-end product, its revenue contribution is expected to be minimal initially, with plans for overseas promotion in the upcoming year [13]

Group 1 - The report highlights that the wealth management market in China has seen a significant increase in scale, reaching a new high despite valuation rectification pressures, with a third-quarter increase of 1.46 trillion yuan, which is 620 billion yuan more than the same period last year [5] - The report indicates that the financial institutions' deposit growth has slowed down, with a total increase of 4.76 trillion yuan in deposits in the third quarter, which is a decrease of 400 billion yuan year-on-year [5] - The wealth management and bond fund scales have shown a year-on-year decrease in the second half of the year, while deposits have started to recover [5] Group 2 - The report discusses the growth potential of the pool cleaning robot industry, which has a current market size of 2.5 billion USD and is expected to grow to 4.21 billion USD by 2029, with a CAGR of 11.1% from 2024 to 2029 [6] - The company is positioned as a leading player in the pool cleaning robot market, holding a 9.2% market share and ranking third globally, with the top five manufacturers accounting for approximately 74.9% of the market [6] - The report emphasizes the company's competitive advantages, including strong R&D capabilities, comprehensive product offerings, and a robust multi-channel sales strategy [6] Group 3 - The report notes that the company has experienced a slowdown in revenue growth, with a 2025 year-to-date revenue of 1.76 billion yuan, reflecting an 18.7% increase year-on-year, while net profit has decreased by 29% [11] - The company is expected to face continued pressure on profitability due to significant investments in new product molds [11] - The report projects net profits for the company to be 121 million yuan, 145 million yuan, and 171 million yuan for 2025, 2026, and 2027, respectively, indicating a decline in 2025 followed by growth in subsequent years [11] Group 4 - The report indicates that the company has achieved a significant increase in revenue and net profit, with a third-quarter revenue of 19.68 billion yuan, representing a 129.19% year-on-year growth [31] - The new game "杖剑传说" has contributed significantly to the company's revenue growth, with total revenue from this game reaching 11.66 billion yuan in the first three quarters of 2025 [31] - The report highlights the company's strong performance in overseas markets, with a 59.46% year-on-year increase in overseas revenue [33]