Group 1 - The Hang Seng Tech Index rose over 1% after previously declining more than 1% [1] - Kingsoft Corporation (03888.HK) led the component stocks with an 11% increase [1]

智通财经6月16日电，截至发稿，金山软件(03888.HK)涨8.38%、心动公司(02400.HK)涨5.74%、友谊时 光(06820.HK)涨4.08%、多牛科技(01961.HK)涨3.95%。 港股游戏股走强 金山软件涨8% ...

金山软件(03888.HK)涨超8%，成交额超2亿港元。 ...

Financial Data and Key Metrics Changes - Group revenue reached RMB2.34 billion, up 9% year over year [6] - Revenue from office software and services decreased 6% year on year to RMB301 million [14] - Online games revenue increased 40% year on year to RMB370 million [16] - Gross profit increased 10% year on year to RMB1.19 billion, with a gross profit margin of 82% [17][19] - Net profit attributable to owners of the parent was RMB284 million, slightly down from RMB285 million year on year [19] Business Line Data and Key Metrics Changes - Kingsoft Office Group revenue reached RMB1.301 billion, marking a 6% year on year increase [8] - WPS individual business generated revenue of RMB857 million, up 11% year on year [8] - Online gaming business revenue reached RMB1.037 billion, a 14% year on year increase [11] Market Data and Key Metrics Changes - WPS Office global monthly active devices reached 647 million, an 8% year on year increase [9] - Monthly active devices for the PC version increased by 11% year on year to 301 million [9] - Monthly active devices for the mobile version increased by 5% year on year to 346 million [9] Company Strategy and Development Direction - Kingsoft Office Group focuses on AI integration and global expansion, enhancing product experiences and user engagement [6][10] - The gaming business aims to deepen the ecosystem around flagship IPs while exploring new genres [11][12] - The company plans to enhance its international presence and develop multiple game categories beyond martial arts [28] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining growth through AI collaboration and product innovation [12][57] - The company is optimistic about the gaming sector's performance despite market uncertainties [49] - Management highlighted the importance of empowering enterprises through AI solutions [57] Other Important Information - Research and development costs increased 16% year on year, driven by AI-related expenses [18] - The company maintains a strong cash position with cash resources of RMB26 billion [20] Q&A Session Questions and Answers Question: Strategic plans for gaming business and updates on Metro Break launch - Management emphasized the need for quality games, diversification into multiple genres, and international market expansion [28][30] - Metro Break is expected to launch in July, with an official announcement in June [31] Question: Updates on WPS office business overseas - Management discussed plans for multiple language versions and operational strategies to enhance overseas presence [34][36] Question: Major optimizations for Metro Break and performance expectations - Management noted ongoing modifications based on player feedback and expressed cautious optimism for post-launch performance [42][45] Question: Trends in active user base and revenue growth for JX3 - Management indicated stable performance for JX3, with expectations for continued engagement despite seasonal fluctuations [46][49] Question: Potential collaboration with Xiaomi in AI - Management outlined a strategic focus on AI development and collaboration with Xiaomi to enhance enterprise solutions [51][57]

Financial Data and Key Metrics Changes - Group revenue reached RMB2.34 billion, up 9% year over year [5] - Revenue from office software and services decreased 6% year on year to RMB301 million [12] - Revenue from online games increased 40% year on year to RMB370 million [14] - Gross profit margin increased by one percentage point year on year to 82% [15] - Profit attributable to owners of the parent was RMB284 million, slightly down from RMB285 million year on year [18] Business Line Data and Key Metrics Changes - Kingsoft Office Group revenue reached RMB1.301 billion, marking a 6% year on year increase [7] - WPS individual business generated revenue of RMB857 million, up 11% year on year [7] - Online gaming revenue reached RMB1.037 billion, a 14% year on year increase [9] Market Data and Key Metrics Changes - WPS global monthly active devices reached 647 million, an 8% year on year increase [8] - Monthly active devices for the PC version increased by 11% year on year to 301 million [8] - Monthly active devices for the mobile version increased by 5% year on year to 346 million [8] Company Strategy and Development Direction - Kingsoft Office Group will focus on AI collaboration and global expansion, sustaining R&D investment [10] - The gaming business will prioritize the development of flagship IPs and explore new genres [10] - The company aims to enhance its international presence and diversify game categories beyond martial arts [27] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the gaming business's ability to adapt and innovate despite market challenges [46] - The company is committed to empowering enterprises through AI and enhancing its own capabilities before assisting others [56] - Management highlighted the importance of quality and passion in game development for future success [28] Other Important Information - Research and development costs increased 16% year on year to RMB828 million [16] - The company had cash resources of RMB26 billion as of March 31, 2025 [19] Q&A Session Summary Question: What are the strategic plans for the gaming business going forward? - Management emphasized the need for quality games, diversification into multiple genres, and internationalization of products [28] Question: Updates on the launch schedule for Metro Break? - The game is expected to launch in July, with an official announcement in June detailing the release specifics [30] Question: Updates on the overseas business of WPS Office? - Management discussed plans for multiple language versions and a comprehensive strategy for overseas operations [34][36] Question: Major optimizations for Metro Break post-testing? - Management mentioned modifications based on player feedback and design adjustments to enhance gameplay experience [42] Question: Trends in active user base and ARPU for JX3? - Management noted stable performance but acknowledged a slight year-on-year decrease compared to the previous quarter [45]

Core Viewpoint - Kingsoft Software reported Q1 2025 revenue of 2.338 billion RMB, achieving a 9% year-on-year growth but a 16% quarter-on-quarter decline, with net profit remaining stable year-on-year [1][2][5]. Financial Summary - Revenue for Q1 2025 was 2.338 billion RMB, compared to 2.136 billion RMB in Q1 2024, and 2.792 billion RMB in Q4 2024, reflecting a 9% increase year-on-year and a 16% decrease quarter-on-quarter [1][2][4]. - Operating profit was 601.5 million RMB, nearly unchanged from the previous year but down 46% from the previous quarter [1][4]. - Net profit attributable to the parent company was 283.9 million RMB, stable year-on-year but down 38% quarter-on-quarter [1][2][5]. - Basic and diluted earnings per share were both 0.21 RMB, unchanged year-on-year but down 40% and 38% respectively from the previous quarter [1][2][5]. Business Segment Performance - Office software and services generated 1.301 billion RMB in revenue, a 6% year-on-year increase, accounting for 56% of total revenue [3][5]. - Gaming business revenue reached 1.037 billion RMB, a 14% year-on-year increase, making up 44% of total revenue [3][5]. - WPS global monthly active devices reached 647 million, an 8% year-on-year increase, with paid users in mainland China totaling 41.7 million, a 17% increase [3][6]. Cost and Investment - R&D costs surged to 828 million RMB, a 16% year-on-year increase, representing 35% of total revenue [2][6]. - The increase in R&D spending was primarily due to higher employee numbers and AI-related expenditures [6]. Gaming Business Insights - The gaming segment saw a revenue of 1.037 billion RMB, a 14% year-on-year increase but a 20% decline quarter-on-quarter [7][8]. - Core IPs like "Dust White Zone" and "Jian Wang 3" contributed stable revenue, but a lack of commercial content updates in Q1 2025 led to a decline in this segment [8].

Financial Performance - For the three months ended March 31, 2025, the revenue was RMB 2,337,995 thousand, representing a 9% increase year-over-year but a 16% decrease quarter-over-quarter[3]. - Operating profit for the same period was RMB 601,453 thousand, showing no change year-over-year and a 46% decrease quarter-over-quarter[3]. - Profit attributable to equity holders of the parent was RMB 283,874 thousand, remaining stable year-over-year but down 38% from the previous quarter[3]. - The basic earnings per share for the period was RMB 0.21, unchanged year-over-year and down 40% quarter-over-quarter[3]. - The total comprehensive income for the period was RMB 500,251 thousand, down from RMB 547,590 thousand year-over-year[7]. - The gross profit for Q1 2025 was RMB 1,918.6 million, with a gross margin of 82%, a year-on-year increase of 1 percentage point[21]. - Operating profit before share-based compensation was RMB 655.1 million, down 3% year-on-year and 44% quarter-on-quarter[26]. Revenue Breakdown - Revenue from office software and services was RMB 1,301,469 thousand, up from RMB 1,225,349 thousand year-over-year[5]. - Revenue from online games and others was RMB 1,036,526 thousand, an increase from RMB 911,526 thousand year-over-year[5]. - Revenue from office software and services was RMB 1,301.5 million, a year-on-year increase of 6% and a quarter-on-quarter decrease of 13%[19]. - The gaming and other business revenue reached RMB 1,036.5 million, showing a year-on-year growth of 14% but a quarter-on-quarter decline of 20%[20]. User Metrics - The number of global WPS Office monthly active devices reached 647 million, an 8% increase year-over-year and a 2% increase quarter-over-quarter[4]. - Cumulative paying users reached 41.70 million, reflecting a 17% increase year-over-year[4]. Research and Development - The group incurred research and development costs of RMB 827,853 thousand, compared to RMB 712,788 thousand in the same period last year[5]. - R&D costs increased to RMB 827.9 million in Q1 2025, up 16% year-on-year and 13% quarter-on-quarter, driven by increased personnel and AI-related expenses[22]. - The company will continue to focus on AI, collaboration, and internationalization, maintaining R&D investments to deliver practical office products to users[38]. Cash Flow and Assets - The net cash flow from operating activities for Q1 2025 was a negative RMB 102,150 thousand, compared to a positive RMB 329,037 thousand in Q1 2024[10]. - The company reported a net cash outflow from operating activities of RMB 102.2 million for the three months ended March 31, 2025[35]. - Current assets totaled RMB 29,839,571 thousand as of March 31, 2025, down from RMB 30,240,397 thousand as of December 31, 2024[8]. - Total non-current assets amounted to RMB 7,988,975 thousand as of March 31, 2025, compared to RMB 8,044,078 thousand as of December 31, 2024[8]. - The company's total equity increased to RMB 28,902,154 thousand as of March 31, 2025, from RMB 28,412,402 thousand as of December 31, 2024[9]. - The total liabilities decreased from RMB 8,716,614 thousand as of December 31, 2024, to RMB 7,802,618 thousand as of March 31, 2025[9]. - The company maintained a strong cash position with cash and bank deposits totaling RMB 22,819.0 million, representing 60% of total assets[32]. Gaming Business - The decline in gaming revenue quarter-on-quarter was attributed to fewer commercial content updates for "Jian Wang 3" in Q1 2025[20]. - The game "Sword of the Net 3" continues to strengthen its user base through content updates and gameplay innovations[38]. - The game "Dust White Zone" maintains user engagement and reputation with differentiated content positioning and long-term operational strategies[38]. - The sci-fi mech game "Limitless Mech" is set to launch in summer 2023, having reached the fifth position on Steam's global wishlist during testing[38]. - The classic sequel "Sword of the Knight: Zero" is planned for release in Q2 2023, inheriting the essence of the IP[38]. - The gaming business will deepen flagship IP ecosystem operations, focusing on new tracks such as anime and sci-fi, enhancing content innovation capabilities[38]. Strategic Focus - The CEO highlighted the growth in WPS personal business and the strategic focus on increasing AI active user numbers to drive user base and paid user growth[37]. - The growth in office software revenue was driven by an increase in user base and paid users, supported by an operational strategy focused on enhancing AI active users[19]. - Sales and distribution expenses rose to RMB 340.5 million, a 30% year-on-year increase, primarily due to higher promotional and advertising investments[23]. - Capital expenditures for Q1 2025 amounted to RMB 121.2 million, compared to RMB 114.6 million in Q1 2024[36].

Financial Data and Key Metrics Changes - The company reported notable growth in earnings per share, indicating a positive trend in profitability [4]. Business Line Data and Key Metrics Changes - There was a significant increase in concurrent users exceeding 300,000, showcasing high popularity for the company's offerings [5]. Market Data and Key Metrics Changes - User feedback on recent tests has been polarized, with key issues including server crashes and debates regarding gameplay mechanics [5]. Company Strategy and Development Direction - The management is expected to discuss strategic investment plans and the use of cash in future communications, indicating a focus on growth and sustainability [4]. Management's Comments on Operating Environment and Future Outlook - Management's views on the sustainability of earnings growth in 2025 were sought, reflecting concerns about maintaining performance in a competitive environment [4]. Other Important Information - The call included a reminder that forward-looking statements may not be reliable for future predictions, highlighting the inherent uncertainties in the market [1]. Q&A Session Summary Question: Sustainability of earnings per share growth in 2025 - Management was asked if the improvement in earnings per share is expected to be sustainable in 2025 [4]. Question: Strategic investment plans and cash usage - A question was raised regarding the company's views on the use of cash and strategic investment plans [4]. Question: User feedback on recent tests - Inquiry was made about the recent test results and the polarized user feedback, particularly concerning server issues and gameplay [5].

Financial Performance - In 2024, Kingsoft achieved a total revenue of RMB 10,317.9 million, representing a year-on-year growth of 21%[10]. - Revenue from office software and services reached RMB 5,121.1 million, an increase of 12% compared to the previous year[10]. - Revenue from online games and other businesses surged to RMB 5,196.8 million, marking a significant growth of 31%[10]. - Operating profit for 2024 soared to RMB 3,646.6 million, a remarkable increase of 64%, with an operating margin rising to 35% from 26% in 2023[10]. - The company achieved a net profit of RMB 2,797.1 million for the year, compared to a loss of RMB 5,341.9 million in the previous year[9]. - The gross profit for 2024 was RMB 8,580.5 million, reflecting a 22% increase year-over-year, with a gross margin of 83%[21]. - The profit attributable to the owners of the parent company for 2024 is RMB 1,551.6 million, up from RMB 483.5 million in the previous year[30]. - The profit attributable to the owners of the parent company before share-based payment costs for 2024 is RMB 1,719.6 million, compared to RMB 684.5 million last year[31]. - The net profit margin excluding share-based payment costs for 2024 and 2023 is 17% and 8%, respectively[32]. - The company reported a significant increase in revenue, achieving a total of $1.5 billion for the quarter, representing a 25% year-over-year growth[1]. Research and Development - Research and development costs increased to RMB 3,045.4 million, reflecting the company's commitment to enhancing core capabilities in collaboration and AI[9]. - Research and development costs rose to RMB 3,045.4 million, a 13% increase year-over-year, due to increased staffing and AI-related investments[22]. - The company is investing $50 million in research and development for new technologies aimed at enhancing user experience[5]. - The company aims to deepen the application of AI technology in the office sector and strengthen the capabilities of WPS 365 while expanding globally[12]. Strategic Focus and Market Expansion - Kingsoft's strategic focus includes enhancing its product ecosystem around "multi-screen, cloud, content, collaboration, and AI" to improve market competitiveness[10]. - The company is actively exploring new game categories while deepening its engagement with classic martial arts IPs in the online gaming sector[10]. - The company plans to launch several new games in 2025, including "Jian Xia Qing Yuan: Zero" and a sci-fi mech game "Jie Xian Ji"[12]. - Market expansion plans include entering three new international markets by the end of the fiscal year, targeting a 15% increase in global market share[6]. Corporate Governance - The company is committed to enhancing corporate governance practices to ensure compliance with the applicable codes and regulations[68]. - The board consists of seven members, including one executive director, three non-executive directors, and three independent non-executive directors, ensuring compliance with listing rules[79]. - The board held four meetings and one annual general meeting during the year ending December 31, 2024, with all directors attending all meetings[86]. - The company has established written guidelines to regulate securities trading by employees who may possess unpublished internal information[76]. - The board is responsible for the preparation of financial statements that fairly reflect the group's financial position and performance, ensuring compliance with applicable accounting standards[78]. - The company has implemented a continuous professional development program for all directors to enhance their knowledge and skills[83]. - The board has authorized senior management to conduct daily operations while maintaining oversight of significant decisions affecting the company[77]. - The company has established a board diversity policy, achieving a female representation of 14% on the board and 32% among all employees[90]. Shareholder Communication and Dividends - The proposed final dividend for 2024 is RMB 184.6 million, up from RMB 171.4 million in 2023[9]. - The board considers internal control, risk management, and the company's financial condition when proposing dividends[114]. - Effective communication with shareholders is prioritized, with updates on business operations and financial data available on the company's website[122]. - The company has reviewed its shareholder communication policy and is satisfied with its execution and effectiveness[123]. Employee and Talent Management - The group employed approximately 8,047 full-time employees as of December 31, 2024, up from 7,172 in 2023[144]. - Employee costs, including directors and senior management remuneration, were approximately RMB 4,070.9 million for 2024, compared to RMB 3,765.5 million in 2023[144]. - The company aims to attract, motivate, and retain key talent through a compensation structure that includes base salary, benefits, retirement plans, performance bonuses, and incentive stock options[98]. - The company has established a shorter vesting period for employee participants under the 2024 share plan to enhance flexibility in attracting and retaining talent[99]. Audit and Compliance - The total remuneration paid to the external auditor, Ernst & Young, for audit services was RMB 6.20 million for 2024, down from RMB 6.65 million in 2023, while non-audit services amounted to RMB 2.45 million, compared to RMB 2.60 million in the previous year[111]. - The company’s financial reporting system and internal controls are regularly reviewed for effectiveness and adequacy[96]. - The company has not detected any non-compliance with the established guidelines by employees during the year[76]. Share Option Plans - The 2024 Share Option Plan was approved on May 23, 2024, allowing for the issuance of up to 133,916,711 new shares, which is 10% of the total shares issued as of that date[158]. - The total number of unexercised share rewards under the 2024 Share Option Plan remained at 1,527,400 as of December 31, 2024[159]. - The maximum number of shares that may be issued upon exercise of options under the 2021 Share Option Plan is capped at 10% of the total issued shares as of December 9, 2021, which amounts to 137,020,371 shares[166]. - The company has approved and adopted the 2021, 2022, 2023, and 2024 share incentive plans, with a total of 870,000, 1,000,000, 1,000,000, and 997,000 shares authorized for issuance, respectively, representing approximately 0.19%, 0.22%, 0.22%, and 0.22% of the total issued share capital as of December 31, 2024[178].

Key Points Summary of Kingsoft Software Conference Call Company Overview - **Company**: Kingsoft Software - **Year**: 2024 - **Total Revenue**: 10.316 billion RMB, a 23% year-on-year increase, marking a historical high [2][5] Financial Performance - **Office Software Revenue**: 5.12 billion RMB, up 12% year-on-year [2][5] - **Online Gaming Revenue**: 5.196 billion RMB, a significant increase of 31% year-on-year [2][5] - **Operating Profit Margin**: 3.65 billion RMB, a 64% increase year-on-year [3][5] - **Net Profit**: 1.55 billion RMB, a remarkable growth of 220% year-on-year [3][5] Business Segments Office Software - **R&D Investment**: Increased focus on AI and collaboration, with the launch of WPS AI 2.0, which includes four components: writing, design, reading, and data [2][6] - **User Engagement**: Aiming to enhance user activity and work efficiency through new features [2][18] - **Overseas Market**: Monthly active users on PC nearing 30 million, with personal product revenue reaching 180 million RMB, a 42% increase [4][20] Online Gaming - **New Game Launch**: "Bottom Line Machine" has over 3 million total testers and 310,000 concurrent users, expected to launch in Q2 [2][7] - **Long-term Product**: "Jian Wang 3" achieved record revenue growth of approximately 20% in 2024, with a stable operation strategy planned for 2025 [2][11] Strategic Focus - **AI Development**: Continued investment in AI technology to enhance product offerings and user experience [6][19] - **Global Expansion**: Plans to increase investment in overseas markets, including R&D and marketing efforts [4][20] - **Shareholder Returns**: Company holds approximately 26.5 billion RMB in cash equivalents, with plans to increase dividends and buybacks when market conditions allow [4][30] Market Position and Competition - **Competitive Landscape**: "Bottom Line Machine" faces competition from titles like "World of Tanks 3" and other similar products [8][10] - **User Growth Strategy**: No perceived ceiling on user numbers in the anime market, with ongoing content updates to maintain engagement [14] Future Outlook - **2025 Projections**: Gaming business expected to see single-digit growth due to high base in 2024; office business guidance not provided but anticipated to perform well [4][15][16] - **AI Integration**: Focus on enhancing AI capabilities in office software, with specific targets for user engagement metrics [18][19] Additional Insights - **Cash Management**: Company maintains a cautious approach to capitalizing expenses, with all costs treated as current expenses [28] - **Cloud Business**: Future funding support for cloud services remains uncertain, with no immediate plans for equity adjustments [34][35] This summary encapsulates the key points from the Kingsoft Software conference call, highlighting the company's financial performance, strategic initiatives, and future outlook across its business segments.