Now, while I'm showing you these tests, I want you to remember one thing. This model is open source. Quen 3, which just came out of Alibaba out of China, is completely open- source and is a Frontier coding model. And today, we're going to put it to the test. So, we have the 2D Navier Stoke solver. Check this out. Boom. And so, we can start with any amount of little squares we want. We hit start and there it goes. And so here you can see it's fluid dynamics or smoke dynamics and it looks really cool. If you ...

Summary of Key Points from the Conference Call Company and Industry - **Companies Involved**: NetEase, Bilibili, Kuaishou - **Industry**: China Digital Entertainment Core Insights and Arguments 1. **Stock Performance**: China digital entertainment stocks have seen significant YTD performance with Kuaishou, NetEase, and Bilibili rising by +75%, +57%, and +30% respectively, compared to HSI's +27% [1][11] 2. **Downgrade Ratings**: NetEase and Bilibili have been downgraded from Overweight (OW) to Neutral due to less attractive risk-reward profiles after recent stock rallies [1][11] 3. **NetEase Earnings Outlook**: Limited earnings upside for NetEase is anticipated due to rising game promotion expenses and a lack of blockbuster game launches in the second half of 2025. The estimated P/E ratio for 2025 is 16x, with a projected EPS CAGR of 6% for 2026-2027 [1][11][26] 4. **Bilibili Revenue Growth**: Bilibili's revenue growth is expected to decelerate from over 20% in the first half of 2025 to 5% in the second half, primarily due to a high comparison base from mobile games [1][11] 5. **Investment Recommendations**: The report suggests accumulating stocks with reasonable valuations (less than 20x P/E) and double-digit profit CAGR, favoring Kuaishou with a 14x P/E and 20% profit CAGR [1][11] Financial Forecasts and Changes 1. **NetEase Financials**: - Revenue forecast for 2025 is RMB 113.54 billion, with an adjusted net income of RMB 39.87 billion [22] - Expected net profit growth to slow to -1% in Q4 2025 and -9% in Q1 2026 [11][26] 2. **Bilibili Financial Revisions**: - Net revenue for 2025 revised down by 1% to RMB 30.20 billion, with mobile games revenue down by 6% [5] - Advertising revenue forecasted to decline by 3% [5] Other Important Insights 1. **Market Conditions**: The digital entertainment sector is influenced by themes such as AI and the experience economy, which are seen as safer investments compared to e-commerce and local services [1] 2. **Competition and Regulation**: Increased competition in the gaming market and potential regulatory changes in China pose risks to revenue growth for both NetEase and Bilibili [11][15] 3. **Valuation Metrics**: NetEase's valuation is at a 20% discount to its five-year average P/E, reflecting a cautious outlook on its future performance [14][17] Conclusion The conference call highlights a cautious outlook for NetEase and Bilibili amidst strong past performance, with concerns over rising costs and competition. The recommendation is to focus on companies with solid growth potential and reasonable valuations within the digital entertainment sector.

Michael MENG (852) 3988 6433 michael.meng@bocigroup.com Index Performance Daily Spotlight 29 July 2025 | | Last close | % 1D | % YTD | | --- | --- | --- | --- | | HSI | 25,562 | 0.7 | 27.4 | | HSCEI | 9,177 | 0.3 | 25.9 | | HSCCI | 4,328 | 0.1 | 14.5 | | MSCI HK | 13,442 | 2.2 | 27.3 | | MSCI CHINA | 81 | 0.4 | 25.4 | | FTSE CHINA A50 | 13,992 | 0.2 | 3.5 | | CSI 300 | 4,136 | 0.2 | 5.1 | | TWSE | 23,413 | 0.2 | 1.6 | | SENSEX | 81,463 | (0.9) | 4.3 | | NIKKEI 225 | 40,998 | (1.1) | 2.8 | | KOSPI | 3,210 | ...

Dr. . Wang, I want to thank you so much for joining us on Bloomberg. What is capturing your attention the most today in artificial intelligence technology.It is the change in the way actually how we doing things and actually how we think about things. Okay. So, you know, and I have a psychology background.So artificial intelligence as a word, as an area is not new for me. And as when I was in a college of students and we we already started to do that. Okay.That was in the early off eighties. Okay. But if yo ...

Summary of China AI Chip Market Conference Call Industry Overview - The conference focused on the **China AI chip sector**, particularly the dynamics of **supply and demand** in light of recent U.S. export controls affecting companies like Nvidia and AMD [2][12][19]. Key Points and Arguments 1. **Demand and Supply Dynamics**: - Demand for AI chips in China is projected to remain strong, with an estimated **$39.5 billion** demand in **CY25**, of which **37%** is expected to come from domestic vendors [3][12]. - Despite the resumption of Nvidia's H20 chip sales, supply constraints are anticipated to persist, leading to a projected **$2.5 billion** supply shortage in CY25, down from an initial estimate of **$12.6 billion** [3][12]. 2. **Impact of Nvidia's H20 Sales Resumption**: - The resumption of H20 sales is expected to benefit local cloud service providers (CSPs) such as **Bytedance, Alibaba, Tencent, and Baidu**, which together account for over **80%** of H20 chip demand in 2024 [4][19]. - The new **B30 chip** is anticipated to contribute an additional **$2.8 billion** in sales, with shipments starting in September 2025 [3][12]. 3. **Domestic Vendor Growth**: - Domestic AI chip vendors are projected to increase their market share significantly, reaching **55% self-sufficiency** by 2027, driven by advancements in local chip performance and production capacity [5][19]. - The localization ratio of China's AI chip market is expected to surge from **17% in 2023 to 55% by 2027** [5][19]. 4. **Investment Trends**: - Total AI capital expenditure in China is projected to reach **RMB 655 billion (USD 91 billion)** in 2025, with more than half allocated to AI chip purchases [35][48]. - Major internet companies are significantly increasing their investments in AI infrastructure, with **ByteDance** allocating **150 billion yuan (USD 20.6 billion)** and **Alibaba** committing **380 billion yuan (USD 53 billion)** over three years [39][40]. 5. **Competitive Landscape**: - The competitive landscape for AI chips in China is fragmented, with significant participation from both global and domestic vendors [58][60]. - Nvidia is expected to maintain a **54% market share** in 2025, down from **66%** in 2024, while domestic players like Huawei are projected to increase their share to **28%** [63][64]. Other Important Insights - The U.S. export controls have created opportunities for domestic vendors as they are not competing with the most advanced global alternatives [5][19]. - The government is heavily investing in AI infrastructure, indicating a strategic prioritization of AI as a national competitive advantage [36][39]. - The AI chip market in China is expected to double in size by 2025, with significant growth in both local and global suppliers [64][68]. This summary encapsulates the critical insights from the conference call regarding the dynamics of the China AI chip market, highlighting the interplay between demand, supply, and the competitive landscape amidst regulatory changes.

15 July 2025 | 11:09AM HKT JD Health International (6618.HK) 2Q25 Preview: solid topline alongside still disciplined spending; On-demand investments a key focus; Buy | | | JDH share price has rallied 60% YTD (vs. HSI +21%), outperforming peers (ALH +37%) and the broader Internet sector. At the current valuation level (21X CY26 PE), heading into 2Q result season we anticipate the key debates to be around: 1) On-demand initiatives: JDH's investments/spending and competition dynamics amid broadly intense on-de ...

Investment Rating - The report assigns a "Buy" rating to major companies in the China Internet sector, including Alibaba, JD.com, Meituan, and Tencent [28]. Core Insights - The quick commerce sector in China is experiencing rapid growth, with a projected market size of Rmb760 billion by 2025, representing 4-5% of the e-commerce market [3]. - Major players like Alibaba and Meituan are significantly increasing their investments to capture market share, with Alibaba committing Rmb50 billion and Meituan surpassing 120 million daily orders [2][3]. - The competition is described as a "game of chicken," with companies expected to continue heavy investments until at least the Double 11 shopping festival [4]. Summary by Sections Quick Commerce Competition - Competition in quick commerce is intensifying, driven by substantial platform subsidies from major players [2]. - Alibaba's Taobao InstaShopping and Meituan are leading in daily order volumes, with Alibaba achieving 80 million combined daily orders and Meituan surpassing 120 million [2]. Market Size and Growth - The total addressable market (TAM) for quick commerce is expected to grow by 30% by 2025, primarily taking market share from traditional retail rather than e-commerce [3]. - The rapid increase in order volume is attributed to consumer behavior and effective coupon utilization strategies [3]. Financial Implications - Earnings cuts are anticipated across e-commerce giants due to the competitive landscape, with expected annual investments of Rmb25 billion from JD, Rmb25-30 billion from Alibaba, and Rmb25 billion from Meituan [4]. - The report forecasts a market share split of 50% for Meituan, 30% for Alibaba, and 20% for JD in the medium term [4]. Stock Recommendations - The report suggests a cautious approach towards Meituan due to high earnings expectations and valuation concerns, while recommending Alibaba for potential value extraction if executed well [7]. - JD's valuation is considered undemanding, and its performance will be monitored as trade in subsidies fades [7].

Company Overview - Nextracker (NASDAQ: NXT) is a significant player in the utility-scale solar sector, which is crucial for the clean energy transition [1] - The company specializes in solar tracking systems and energy optimization software, positioning itself strategically in the market [1] Industry Relevance - The utility-scale solar business is gaining importance as the world shifts towards clean energy solutions [1] - Nextracker's technology plays a vital role in enhancing the efficiency and effectiveness of solar energy production [1]

Group 1 - Visteon Corporation (NASDAQ: VC) is a significant player in the automotive technology sector, focusing on digital cockpit solutions and vehicle electronics [1] - The company is capitalizing on trends in the automotive industry, particularly in the areas of vehicle connectivity and advanced electronics [1] Group 2 - The analysis highlights the importance of fundamental analysis in evaluating publicly listed companies, emphasizing the need to assess whether a stock is undervalued or overvalued for informed long-term investment decisions [1]

Core Insights - J&T reported strong operating data for 2Q25, with parcel volume increasing by an average of 24% YoY, primarily driven by a remarkable 66% YoY growth in the Southeast Asia (SEA) market [1][2] - The earnings forecast for 2025E/26E has been revised, with an increase of 18% for 2025E and a slight decrease of 2% for 2026E, reflecting an upward adjustment in parcel volume forecasts despite a minor reduction in pricing assumptions [1] - The target price (TP) has been raised to HK$10 from HK$6.9, indicating a positive outlook for J&T in the Hong Kong market due to its market share gains in the SEA region [1] Southeast Asia Market - The SEA volume surged by 66% YoY to 1.69 billion units, with growth accelerating from 50% in 1Q25, benefiting from strong sales growth from platforms like Temu, Shein, and TikTok [2] - Management believes that J&T has further strengthened its competitive advantage over major peers in terms of parcel volume growth in the SEA market [2] China Market - In China, parcel volume grew by 15% YoY to 5.6 billion units, although the growth rate slowed from 27% in 1Q24 [3] - The largest customer in China is PDD, followed by Douyin and Alibaba, with reverse parcels and individual orders accounting for 7% of total volume [3] - Management expressed a conservative outlook due to uncertainties from intense price competition [3] New Markets - New markets experienced a 24% YoY increase in volume to 89 million units, driven by growth in the Brazilian market [4] - J&T has initiated cooperation with Mercado Libre this year, and the entry of more e-commerce platforms into Brazil presents additional growth opportunities [4]