Loongson Technology(688047) 东兴证券·2025-02-18 06:23Investment Rating - The report maintains a "Recommended" rating for the company, indicating a positive outlook despite short-term performance challenges [2][12]. Core Viewpoints - The company is experiencing short-term pressure on its performance, with a forecasted revenue of approximately 506 million yuan for 2024, remaining stable compared to the previous year. However, the expected net profit attributable to shareholders is projected to decline significantly to -619 million yuan, a decrease of about 87.89% year-on-year [3][6]. - The company is actively addressing operational pressures and is optimistic about long-term growth potential, particularly in the AI and information technology sectors. The local deployment of AI models using the company's processors is seen as a significant advancement [5][12]. Summary by Sections Financial Performance - The company anticipates a revenue of approximately 506.53 million yuan for 2024, which is nearly flat compared to the previous year. The net profit is expected to drop to -617.82 million yuan, reflecting a year-on-year decline of 87.54% [3][13]. - The company has reported a significant increase in sales of information technology products, which has positively impacted gross margins, although overall gross margin levels have not fully recovered due to high fixed costs and declining contributions from industrial control chip revenues [4][6]. Market Position and Strategy - The company is leveraging its strengths in the electronic government market, which is beginning to recover, and is focusing on the cost-performance advantages of its new products, such as the 3A6000 and 2K0300 processors [4][5]. - The collaboration with industry partners to deploy AI models locally is a strategic move to enhance productivity and reduce reliance on cloud services, which is expected to benefit the company in the evolving "AI + information technology" landscape [5][12]. Future Outlook - The company is projected to return to a growth cycle in the second half of 2024, driven by the recovery in the electronic government market and the successful deployment of new products [4][6]. - The forecast for net profit for 2025 and 2026 is set at 13.34 million yuan and 88.74 million yuan, respectively, indicating a potential recovery in profitability [12][13].