YAOJI TECHNOLOGY(SZ:002605) KAIYUAN SECURITIES·2025-05-05 08:23Investment Rating - The investment rating for the company is "Buy" (maintained) [1][3] Core Views - The company demonstrated resilience in its performance, with a notable improvement in Q1 2025 compared to the previous quarter, driven by a recovery in its main business and a focus on new product categories in casual gaming and card business [3][4] - The revenue for 2024 was reported at 3.271 billion yuan, a year-on-year decrease of 24.0%, while the net profit attributable to the parent company was 539 million yuan, down 4.2% year-on-year [3][4] - The company is expected to see a gradual recovery in its performance, with projected net profits for 2025, 2026, and 2027 at 651 million, 720 million, and 768 million yuan respectively, indicating a positive growth trajectory [3][4] Financial Performance Summary - In Q1 2025, the company achieved a revenue of 779 million yuan, a year-on-year decrease of 20.67% but a quarter-on-quarter increase of 61.66% [3][4] - The gross margin improved to 44.27% in Q1 2025, up by 6.47 percentage points year-on-year, attributed to a higher proportion of high-margin gaming business and price increases in the card business [4] - The company maintained effective cost control, with sales expenses down 12.7% year-on-year and R&D expenses down 21.9% year-on-year [4] Business Outlook - The gaming business remains solid, with leading market positions in products like "Finger Fishing" and new growth opportunities from products like "Happy Dou Di Zhu" [5] - The card business is expected to benefit from increased production capacity and price hikes, with a new production base for 600 million decks of cards under construction [5] - The company is also strategically investing in a trading platform for sports cards, which is anticipated to have significant growth potential due to the industry's favorable conditions [5]