Changjiang Securities·2025-08-11 14:29Investment Rating - The investment rating for the company is "Buy" and it is maintained [9]. Core Views - In H1 2025, the company's revenue decreased by 0.5% to 543.8 billion yuan, primarily due to a decline in low-margin non-core business, aligning with the company's focus on "profitable and cash-generating revenue." However, Q2 profits exceeded expectations [2][12]. - The traditional business's ARPU (Average Revenue Per User) faced pressure, while AI direct revenue grew rapidly, reaching tens of billions [2][12]. - The company has implemented comprehensive cost reduction and efficiency improvement measures, with cost growth lower than revenue growth, resulting in a year-on-year decline in several metrics [2][12]. - The company has lowered its full-year capital expenditure guidance and confirmed that the dividend payout ratio for 2025 will be further increased compared to 2024 [2][12]. - The outlook for the year includes goals for stable revenue growth and good profit growth [2][12]. Summary by Sections Financial Performance - In H1 2025, the company achieved operating revenue of 543.8 billion yuan, a year-on-year decrease of 0.5%, with a net profit attributable to shareholders of 84.2 billion yuan, a year-on-year increase of 5.0% [6][12]. - In Q2 2025, the company reported revenue of 280 billion yuan, a year-on-year decline of 1.1%, with a net profit of 53.6 billion yuan, up 6.0% year-on-year [12]. Business Segments - In H1 2025, personal market revenue was 244.7 billion yuan, down 4.1%, while mobile ARPU was 49.5 yuan, down 2.9%. Family market revenue grew by 7.4% to 75 billion yuan, with a family customer ARPU of 44.4 yuan, up 2.3% [12]. - Emerging business revenue from the government and enterprise market was 118.2 billion yuan, up 5.6%, and mobile cloud revenue was 56.1 billion yuan, up 11.3% [12]. Cost Management - The company has effectively implemented cost reduction strategies, with various cost metrics showing year-on-year declines. For instance, network operation and support expenses decreased by 1.7% [12]. - In H1 2025, the company completed capital expenditures of 58.4 billion yuan and has adjusted its full-year capital expenditure guidance to less than 151.2 billion yuan [12]. Dividend Policy - The interim dividend per share is set at 2.75 HKD, a year-on-year increase of 5.8%, with an A-share interim payout ratio of 64% [12]. The company has indicated that the dividend payout ratio for 2025 will be higher than in 2024 [12].