Bingo Software (SH:688227) Hua Xia Shi Bao·2025-05-31 12:11Core Viewpoint - The announcement by Pingao Co., Ltd. regarding a service contract with Shenzhen Yuanmai Cloud Computing Technology Co., Ltd. highlights the company's role as a resource integrator and intermediary service provider in the computing power service chain, which poses dual risks to its gross margin due to upstream supply chain stability and its own technical premium capability [2][3][4]. Group 1: Contract Details - Pingao's wholly-owned subsidiary, Guangzhou Weigao Software Technology Co., Ltd., signed a service contract with Shenzhen Yuanmai for a total amount of 397 million yuan (including tax) [2]. - The contract includes the provision of computing power resources, software platform usage, and five years of technical support [2]. Group 2: Business Model and Risks - The business will recognize revenue using the net method, focusing on service premium while excluding equipment leasing costs [3][4]. - The dual pressure on gross margin arises from the upstream computing power rental market's supply-demand dynamics and the pricing constraints from clients and industry competition [4]. Group 3: Financial Performance - Pingao has experienced declining net profits since 2022, with a net profit of 47.11 million yuan in 2022, down 15.31% year-on-year, and a net loss of 10.68 million yuan in 2023, marking the first loss since its listing [6]. - The company's gross margin has decreased from 41.39% in 2022 to 22.95% currently [6]. Group 4: Accounts Receivable and Cash Flow - The accounts receivable balance has increased over the past three years, with a significant portion being overdue, raising concerns about collection risks [7]. - The net cash flow from operating activities has been negative since 2023, indicating ongoing financial strain [7]. Group 5: Counterparty Concerns - Shenzhen Yuanmai, established in February 2024, has a weak capital structure with a registered capital of only 1 million yuan, raising concerns about its ability to fulfill contractual obligations [4][5]. - The largest shareholder of Shenzhen Yuanmai also has limited capital, which may affect the company's risk management and performance [5].