Yonyou(SH:600588) Western Securities·2025-08-28 11:07Investment Rating - The report maintains a "Buy" rating for the company, indicating a positive outlook for future investment returns [5][10]. Core Insights - The company reported a revenue of 3.58 billion yuan for H1 2025, a year-over-year decrease of 5.9%, with a net profit attributable to shareholders of -0.94 billion yuan [1][5]. - The company is experiencing a turning point, with Q2 2025 showing a revenue increase of 7.15% year-over-year, marking the first positive growth in four quarters [1][2]. - The transition to a subscription model is progressing well, with subscription-related contract liabilities reaching 2.41 billion yuan, a year-over-year increase of 23.6% [2]. Summary by Sections Financial Performance - For H1 2025, revenue from large enterprise clients was 2.32 billion yuan (down 2.9% year-over-year), while revenue from core product BIP3 was 1.33 billion yuan (up 7.7% year-over-year) [1][5]. - The company reported a significant improvement in cash flow, with a net cash inflow of 0.09 billion yuan in Q2 2025 [1][2]. Business Segments - Revenue from medium-sized enterprise clients decreased by 23.0% year-over-year to 0.46 billion yuan, primarily due to the ongoing transition to a subscription model [1][2]. - The cloud service business achieved an Annual Recurring Revenue (ARR) of 2.65 billion yuan, reflecting a year-over-year growth of 13.7% [2]. Future Projections - The company is expected to generate revenues of 10 billion yuan, 11.1 billion yuan, and 12.4 billion yuan for the years 2025, 2026, and 2027, respectively, with net profits projected to improve significantly by 2027 [2][3].