Guoxin Securities·2025-08-03 14:00Investment Rating - The report maintains an "Outperform" rating for the communication industry, indicating expected performance above the market benchmark [4][57]. Core Insights - The North American technology companies continue to validate the high prosperity of AI, with significant revenue growth reported by major CSPs such as Microsoft, Meta, and Amazon, with revenues of $764 billion, $475 billion, and $1,677 billion respectively, reflecting year-on-year growth of 18%, 22%, and 17% [1][12]. - The "Artificial Intelligence+" initiative approved by the State Council is expected to support the continuous development of domestic AI, with a focus on investment opportunities in IDC, networks, and liquid cooling technologies [2][38]. - The report highlights the sustained high demand for computing infrastructure, driven by AI investments, and recommends focusing on domestic computing companies such as Huagong Technology, Guangxun Technology, and ZTE [3][53]. Summary by Sections Industry News Tracking - North American CSPs are increasing their capital expenditures significantly, with Microsoft expected to raise its capital expenditure to over $30 billion in FY26Q1, and Amazon's total capital expenditure projected to reach $118.5 billion for the year [1][27]. - Companies like Celestica, Corning, and Vertiv reported strong revenue growth, with Celestica's revenue increasing by 21% to $2.89 billion, Corning's by 12% to $4.05 billion, and Vertiv's by 35% to $2.64 billion [29][31][34]. Market Performance - The communication index rose by 2.54% this week, outperforming the Shanghai Composite Index, which fell by 1.75%, resulting in a relative return of +4.29% [2][45]. - Within the sector, optical modules, optical components, and satellite internet showed strong performance, with respective increases of 8.22%, 5.43%, and 2.78% [45][47]. Investment Recommendations - The report suggests a long-term investment in the three major telecom operators due to their stable operations and increasing dividend payouts, recommending stocks such as China Mobile, ZTE, and Huagong Technology for the upcoming week [3][53].