Tai Ping Yang·2024-08-21 07:09Investment Rating - The report maintains a "Buy" rating for the company, expecting a relative increase of over 15% compared to the CSI 300 index in the next six months [3][10]. Core Insights - The company's revenue is showing signs of recovery, particularly in the AI sector, with both revenue and profit growth maintaining a positive trend [3]. - For FY24/25E, the company is projected to achieve an EPS of $0.10, with further increases to $0.12 in FY25/26E and $0.14 in FY26/27E [3][4]. Financial Performance Summary - The company reported Q1 FY24/25 revenue of $15.447 billion, a year-on-year increase of 20%, and a net profit of $243 million, up 38% year-on-year [2]. - The gross margin for Q1 FY24/25 was 16.6%, a decrease of 0.9 percentage points from the previous year, primarily due to rapid growth in the lower-margin infrastructure solutions segment [2]. - The company’s three business segments showed varied performance: - Smart Devices segment revenue reached $11.422 billion, up 11.32% year-on-year, with an operating profit margin of 7.25% [2]. - Infrastructure Solutions segment revenue surged to $3.160 billion, a 65.11% increase year-on-year [2]. - Solutions Services segment revenue was $1.885 billion, reflecting a 10.83% year-on-year growth [2]. Strategic Developments - In May 2024, the company entered a strategic cooperation framework agreement with Alat, a subsidiary of Saudi Arabia's Public Investment Fund, to issue $2 billion in zero-coupon convertible bonds and establish a regional headquarters in Saudi Arabia [2].