Core Viewpoint - The China Securities Hong Kong Internet Index has shown a mixed performance, with a recent increase but a decline over the past three months, reflecting the overall volatility in the Hong Kong internet sector [2]. Group 1: Index Performance - The China Securities Hong Kong Internet Index rose by 0.94% in the past month, decreased by 1.66% over the last three months, and has increased by 19.85% year-to-date [2]. - The index is based on 30 publicly listed companies in Hong Kong related to internet businesses, with a base date of December 30, 2016, set at 1000.0 points [2]. Group 2: Index Holdings - The top ten weighted companies in the index are Alibaba-W (17.7%), Tencent Holdings (15.98%), Xiaomi Group-W (13.18%), Meituan-W (10.93%), NetEase-S (7.31%), Kuaishou-W (5.65%), Baidu Group-SW (5.29%), JD Group-SW (4.71%), Trip.com Group-S (4.59%), and JD Health (1.73%) [2]. - The index's holdings are entirely composed of companies listed on the Hong Kong Stock Exchange [3]. Group 3: Sector Allocation - The sector allocation of the index holdings includes Consumer Discretionary (39.29%), Communication Services (38.32%), Information Technology (18.76%), Healthcare (3.07%), and Financials (0.56%) [3]. Group 4: Index Adjustment Mechanism - The index samples are adjusted semi-annually, with adjustments occurring on the next trading day after the second Friday of June and December each year [3]. - New internet companies in Hong Kong with a market capitalization exceeding $10 billion may be added to the index on their eleventh trading day if they rank among the top twenty companies [3].

Core Viewpoint - The article emphasizes the importance of game operation in the current market, highlighting that success or failure often hinges on effective player engagement and retention strategies in a saturated gaming environment [6][18][56]. Group 1: Game Operation and Player Engagement - The recent incident in "Battlefield 2" illustrates how crucial game operation is, as player dissatisfaction arose from perceived operational flaws despite the game's initial success [3][5]. - Tencent's strategic officer noted that stagnation in a game often points to issues within the operational team rather than the game itself, stressing the need for the right personnel to manage player engagement [15]. - The gaming industry is transitioning from a phase of rapid growth to one focused on retaining existing players, making player operation more critical than ever [17][18][19]. Group 2: Challenges in Player Retention - In 2024, China's gaming user growth was only 0.94%, indicating a shift towards a more competitive landscape where retaining existing players is paramount [17]. - Companies are now tasked with keeping older games engaging for long-term players, which presents unprecedented challenges for player operation roles [19][30]. - Effective player operation involves monitoring user behavior and intervening before players decide to leave, utilizing data-driven strategies to enhance user experience [28][30]. Group 3: Evolution of Game Operation - The evolution of player operation has been significant, moving from basic customer service to a comprehensive lifecycle management approach that addresses user needs at every stage [49][52]. - The cost of acquiring new players has increased dramatically, necessitating a focus on retaining existing users to justify the investment made in acquiring them [55][56]. - Companies are learning from successful long-standing games, implementing strategies to extend their lifecycle and maintain player interest [57][58]. Group 4: The Role of Player Operation Teams - Player operation teams are now expected to provide "exceeding expectations" services, creating emotional connections with players to enhance retention [43][48]. - Successful player operation involves not just addressing complaints but also proactively engaging with players through personalized interactions and community-building activities [43][44][67]. - The emotional aspect of player operation is highlighted, as operators often form bonds with players, which can lead to increased loyalty and reduced churn [66][72].

Core Viewpoint - The article emphasizes the critical importance of game operation in the current market, highlighting that success or failure often hinges on effective player engagement and retention strategies [5][7][9]. Group 1: Game Operation Importance - Game operation has become increasingly vital as the gaming industry transitions into a phase of stagnant user growth, with only a 0.94% increase in China's gaming user base in 2024 [8]. - The era of coarse growth in the gaming industry has ended, necessitating a focus on retaining existing users rather than acquiring new ones [9]. - Effective game operation can lead to significant player retention, as evidenced by the resurgence of player numbers in games like "绝地潜兵2" through strategic operational efforts [4][5]. Group 2: Player Engagement Strategies - Companies are now employing detailed player operation strategies, including personalized communication and proactive engagement to prevent player churn [14][15]. - The use of data analytics allows companies to identify at-risk players and intervene before they decide to leave, with some companies reporting a 70% chance of player loss if no action is taken [15][29]. - The concept of "全用户全生命周期服务" (full user lifecycle service) is being adopted, indicating that engagement starts from the moment a player shows interest in a game [15][28]. Group 3: Challenges in Player Operation - The operational teams face immense pressure to manage player expectations and emotions, often acting as a buffer between the players and the game developers [19][20]. - High turnover rates and the emotional toll of dealing with frustrated players are common challenges faced by game operation staff [20][21]. - Companies are implementing measures to support the mental health of their operational teams, recognizing the need for emotional resilience in high-stress environments [21][23]. Group 4: Historical Context and Evolution - The evolution of game operation practices has been significant over the past two decades, transitioning from basic customer service to sophisticated user engagement strategies [27][29]. - The gaming industry has shifted from a focus on acquiring new players to extending the lifecycle of existing games, driven by increased competition and rising user acquisition costs [29][30]. - Historical practices in player engagement, such as community events and personalized interactions, are being revisited and enhanced with modern technology [30][31].

Core Insights - China's technology sector is expected to show resilience in H2 2025, leveraging global trade pressures to foster indigenous innovation despite facing significant U.S. tariffs and export restrictions [2] - Major Chinese tech companies are pivoting investments towards AI infrastructure and emerging technologies, with strong demand for AI outpacing supply [2] - The semiconductor industry in China has captured over 25% of the global market share in advanced packaging technologies, showcasing its competitive edge [5] Company Highlights - **NetEase**: - Demonstrated strong financial momentum with Q1 2025 gaming revenues increasing by 12.1% year over year to RMB24.0 billion and net income rising by 35% to RMB10.3 billion [9][11] - Upcoming game titles and a robust pipeline position the company for growth in the second half of 2025 [10][11] - **Alibaba**: - Reported Q4 fiscal 2025 non-GAAP earnings surged by 23% year over year to $1.73 per ADS, exceeding estimates by 16.89% [12][13] - The Cloud Intelligence segment achieved 18% revenue growth, with AI-related products maintaining triple-digit growth for seven consecutive quarters [12] - **Taiwan Semiconductor**: - Achieved Q1 2025 revenues of $25.53 billion, a 35% year-over-year increase, with net income rising by 53% to nearly $11 billion [15] - Plans to increase capital spending to between $38 and $42 billion in 2025 to meet growing AI-driven demand for advanced chips [16] - **Tencent**: - Reported Q1 revenues of RMB180 billion, a 13% year-over-year increase, with gaming division growth accelerating [17] - Integrated AI capabilities are enhancing user engagement and advertising effectiveness, positioning the company favorably in the market [18][19] Industry Trends - The robotics sector in China is advancing with innovations such as sophisticated humanoid robots, while the electric vehicle ecosystem is bolstered by companies like Zeekr and Great Wall Motor [6] - Augmented reality companies in Beijing are developing advanced AR solutions, reflecting China's strategy to lead in high-tech sectors [7] - The overall technological advancements and significant investments in development present substantial growth opportunities for investors in the Chinese tech landscape [8]

Market Capitalization Changes - The market capitalization of major global technology and internet companies has shown varied changes as of June 4, 2025, with notable increases in companies like Tesla and AMD, which rose by 0.46% and 2.34% respectively [3][5] - Companies such as Uber and Booking Holdings experienced declines, with Uber down by 1.33% and Booking Holdings down by 1.15% [4][5] Notable Performers - Tesla's market cap reached $1,108.8 billion, while AMD's market cap was $190.2 billion, reflecting strong performance in the semiconductor sector [3][5] - Oracle and SAP also saw increases in their market caps, with Oracle up by 1.54% and SAP by 0.57%, indicating positive market sentiment towards enterprise software companies [3][4] Decliners - Booking Holdings and Uber faced declines in their market valuations, with Booking Holdings at $178.1 billion and Uber at $172.5 billion, suggesting potential challenges in the travel and ride-sharing sectors [4][5] - Other companies like Shopify and Spotify also reported slight decreases, indicating mixed performance across the tech and internet landscape [4][5] Emerging Trends - Companies like Palantir and CrowdStrike showed positive growth, with Palantir increasing by 0.86% and CrowdStrike by 2%, highlighting a trend towards cybersecurity and data analytics [3][5] - The semiconductor industry remains strong, with companies like Micron Technology and SK Hynix showing significant increases of 4.15% and 6.27% respectively, reflecting ongoing demand for chips [5][6]

Summary of the Gaming Industry Conference Call Industry Overview - The gaming industry is currently undervalued, with an average valuation of 15-18 times earnings, significantly lower than new consumption companies which are valued at 25-30 times earnings [1][2][4] - The industry experienced a growth rate of 20% in April, driven by leading companies maintaining and innovating existing games, while smaller companies are breaking through in niche segments [1][2][8] Key Players and Performance - Leading companies such as Tencent, NetEase, and miHoYo have achieved growth through long-term operations of existing games like "Honor of Kings," "Peacekeeper Elite," and "Genshin Impact" [1][5] - Smaller companies like Gigabit, Electric Soul, and Century Huatong are innovating in niche areas, with titles like "Endless Winter" and "King's Raid" showing significant revenue growth [1][6][7] Market Dynamics - The gaming industry is showing potential to be part of the new consumption sector, with a recovery in growth rates and active exploration of AI applications and product innovations [8] - Upcoming months will see the launch of multiple new products, particularly during the summer season, which is expected to boost user engagement and spending [9] Competitive Landscape - The competitive landscape is stabilizing, with companies focusing on their strengths; Tencent leads in FPS games, while smaller companies excel in OSG and female-oriented games [3][12][13] - The industry is entering a new product cycle, with many companies launching new titles, leading to a more favorable competitive environment compared to previous years [35] New Product Launches - Notable upcoming products include "Supernatural Action Group" by Giant Network, "King's Raid" by Century Huatong, and "Wildman 2" by Electric Soul, all expected to perform well [14][16][17] - Tencent is set to release "Valorant Mobile" and "Honor of Kings World," while NetEase has several new titles lined up [17][18] Financial Outlook - The average valuation of the gaming sector remains attractive compared to other new consumption sectors, with core companies valued at 15-20 times earnings [10][35] - Companies like Giant Network, Gigabit, and Electric Soul are highlighted as having significant potential due to new product launches and market dynamics [39] Regulatory Environment - The regulatory environment for the gaming industry has improved, with an increase in the number of game approvals and supportive policies from local governments [24] Investment Recommendations - Current market conditions present a favorable opportunity for investment in the gaming sector, particularly in companies with new product launches and strong growth potential [25][26][39]

Investment Rating - The report maintains a "Positive" investment rating for the media and internet industry [4] Core Viewpoints - Hong Kong's introduction of the "Stablecoin Regulation Draft" on May 30 marks a significant step in the digital asset sector, potentially positioning Hong Kong as an international Web3 and digital finance hub, which may also aid in the internationalization of the Renminbi and the development of offshore financial services [4] - The upcoming summer blockbuster season is highlighted, with a focus on the performance of quality content products, including new game launches and film releases [4] Summary by Sections Industry Performance - From May 26 to May 30, 2025, the Shanghai Composite Index decreased by 0.03%, while the Shenzhen Component Index fell by 0.91%. The media sector, however, saw a positive change of 1.74%, ranking 6th among all industries [13][14] Game Sector - The launch of quality products continues to significantly contribute to company performance, as seen with the game "Chaotic Chef" from Friendship Time, which boosted its market value after its release on May 28 [6] - Recommendations include focusing on leading gaming companies exploring AI+ gaming paradigms, as well as monitoring the performance of new game product cycles [6] Film Sector - The summer film season is approaching, with key films like "Liao Zhai: Lan Ruo Si" and "Chang'an's Lychee" being scheduled for release, which is expected to drive steady growth in box office revenues [6] Card and Trendy Toys - The sector shows high growth potential, with companies increasingly focusing on the "Guzi Economy" and expanding into trendy toy markets [7] Internet Sector - Major companies like Tencent and Alibaba have reported stable business development, emphasizing the optimization of business efficiency through AI [8] AI Applications - Companies embracing new technologies with data, user, and application advantages are recommended for continued observation, as AI applications are expected to undergo a paradigm shift [9] State-Owned Publishing - State-owned media companies are actively pursuing mergers and acquisitions, with some exploring new business models in education [9] Market Overview - The report notes that the media industry continues to experience an upward trend, suggesting ongoing investment in new channels and content directions [10]

Investment Rating - The report maintains a "Recommendation" rating for the media industry, expecting the industry index to rise more than 5% over the next 3-6 months compared to the benchmark index [49]. Core Viewpoints - The report expresses a positive outlook on the IP toy sector, highlighting its long-term growth potential driven by diverse product categories. The recent success of the "Jinli Naju" limited edition merchandise from Alibaba Pictures during the Dragon Boat Festival is noted as a significant indicator of market interest [5][6]. - The media sector is currently experiencing a resurgence in AI applications, with a focus on cultural confidence stemming from popular IPs like "Nezha." The report anticipates a reshaping of the application landscape in 2023, particularly in public cloud services and B-end SaaS enterprises [5][6]. - The gaming market is highlighted as a key area of interest, with recommendations to focus on companies like Huatuo, Perfect World, and JiBit, driven by product cycles and deepening AI integration [5][6]. Summary by Sections Market Performance Review - The media sector index rose by 1.74% last week, outperforming the CSI 300 index, which fell by 1.08%, resulting in a relative outperformance of 2.82% [8]. - The total market capitalization of the media sector is approximately 1,569.05 billion yuan, with 140 listed companies [2]. Gaming Market - Tencent's games dominate the iOS sales rankings, with "Honor of Kings" and "Peacekeeper Elite" leading the charts. New releases from other companies are also noted, indicating a competitive landscape [16][17]. Film Market - As of May 30, 2025, the film market has achieved a box office of 24.545 billion yuan, recovering approximately 98% of the box office compared to the same period in 2019. The total number of viewers is around 588 million, recovering about 86% [19][22]. - The top films during the week of May 26 to May 30 include "Mission: Impossible 8" and "Lilo & Stitch," with significant box office contributions [26]. Key Company Announcements - Meituan reported a revenue of 86.6 billion yuan for Q1 2025, exceeding market expectations by 18.1%, with a net profit of 10.95 billion yuan, reflecting a year-on-year growth of 46.2% [33]. - Kuaishou's Q1 2025 revenue reached 32.608 billion yuan, showing an 8.8% year-on-year increase, with a net profit of 3.978 billion yuan [34].

Group 1 - The recent performance of Hong Kong and A-shares has been lackluster, with market movements heavily influenced by U.S. events, particularly Trump's tariff actions [1] - Trump's recent threats to impose tariffs on the EU and increase steel tariffs to 50% have created volatility in the markets, reflecting the uncertainty surrounding U.S. fiscal policy [1][2] - The 30-year U.S. Treasury yield remains above 5%, raising concerns about the stability of U.S. debt and its implications for the broader financial market [1][2] Group 2 - The new consumption sector in Hong Kong is gaining attention, characterized by a diverse range of companies from bubble tea to beauty products, indicating a broad interpretation of consumer spending [5][6] - Major internet companies in China, such as Meituan and Xiaomi, reported strong earnings, with Meituan exceeding revenue and profit expectations despite ongoing competition with JD.com [6] - PDD's financial performance has been mixed, with revenue growth but a significant drop in net profit, attributed to government subsidies and market conditions, leading to volatility in its stock price [6] Group 3 - The IPO market in Hong Kong has shown a positive trend, with a low first-day loss rate of 28.6% for new listings, the lowest since 2017 [7] - New stock performance varies significantly, with some companies like Ningde Times and Guanshi Shuduan showing substantial first-day gains, while others like Paige Biopharma experienced significant losses [8] - The strategy for participating in new stock offerings emphasizes quick exits within three days, suggesting a focus on short-term gains rather than long-term holdings [8][9]

另据美国商务部最新公布的数据，美联储最青睐的通胀指标——4月核心PCE物价指数同比上涨2.5%，符合预 期，为四年多来最小涨幅。数据发布后，交易员仍押注美联储将在9月降息。 号称"美联储传声筒"的《华尔街日报》记者NickTimiraos警告称，预测人士估计，随着关税政策的影响显现， 预计今年5月，尤其是6月，美国商品价格涨幅将会加快。美股开盘后，三大指数呈现窄幅震荡格局，美股大型 科技股多数走弱。 美国关税政策的扰动仍在持续。 重磅数据出炉 受关税政策影响，美国贸易数据出现史诗级波动。今晚，美国普查局发布的《经济指标预览》报告显示，4月 份美国商品进口额从3月的3444.70亿美元下降至2760.97亿美元，环比暴跌19.8%，创有记录以来的最大降幅。 北京时间5月30日晚间，美国商务部普查局表示，随着关税政策实施前进口抢跑带来的推动作用消退，美国4月 商品贸易逆差大幅收窄。 据最新发布的《经济指标预览》报告，美国4月份商品贸易逆差收窄至876亿美元，市场预估为逆差1430亿美 元，前值为逆差1632亿美元。 报告显示，4月份美国商品进口额从3月的3444.70亿美元下降至2760.97亿美元，环比大幅下降 ...