Investment Rating - The report assigns a "Buy" rating for the company, marking its first coverage [4]. Core Insights - The company leverages its long-standing IPs in gaming and embraces AI to enhance efficiency and reduce costs, particularly in the MMORPG sector [2][36]. - The education segment, led by Mynd.ai, is transitioning towards a SaaS model, which is expected to improve profitability as the market for educational hardware enters a replacement cycle [3][55]. - Strategic investments in AI, AR, and the broader entertainment sector are aimed at building a long-term growth ecosystem [4][69]. Summary by Sections 1. Gaming and Application Services - The company has a strong foundation in MMORPGs, with flagship IPs like "Magic Domain," "Conquest," and "Spirit of Heroes" contributing to stable cash flow [36]. - AI integration has led to a 26.7% reduction in R&D costs in the gaming segment, enhancing profitability [51]. - The gaming segment is expected to generate revenues of 2,594 million, 3,160 million, and 3,318 million yuan from 2025 to 2027, with respective year-on-year growth rates of -25%, +7%, and +5% [76]. 2. Education Segment - Mynd.ai, a leader in educational interactive display devices, has a market share of nearly 16% in the global stock of interactive devices as of 2024 [3][56]. - The transition to a SaaS model is underway, with a 8% quarter-on-quarter growth in SaaS subscriptions, particularly for the flagship application "Explain Everything" [63]. - Revenue from the education segment is projected to be 1,685 million, 1,769 million, and 1,946 million yuan from 2025 to 2027, with year-on-year growth rates of -20%, +5%, and +10% [76]. 3. Strategic Investments - The company has made strategic investments in AI, AR, and the entertainment sector to create synergies with its core gaming and education businesses [4][69]. - Investments in companies like Rokid and Shuaiku Network are expected to enhance market competitiveness and provide new channels for user engagement [72][75]. - The collaboration with Zhongke Wenge aims to develop AI applications for various sectors, positioning the company as a leader in AI technology deployment [70].

Core Viewpoint - Mynd.ai is planning significant layoffs to improve operational efficiency and aims to achieve EBITDA profitability by 2026 [1] Company Overview - Mynd.ai specializes in the sales of interactive flat panel displays (IFPD) for K-12 classrooms and subscription-based software (SAAS) under the brand Promethean, primarily targeting North America and Western Europe [1] - The company has a gross margin of approximately 30% [1] Market Conditions - The demand for classroom flat panel products surged during the pandemic, but the market is now experiencing a downturn from 2023 to 2025 [1] - Mynd.ai has been facing losses due to this market adjustment [1] Strategic Initiatives - The company is implementing measures to meet the board's strong directive to achieve EBITDA profitability by 2026 [1] - Plans include significant reductions in administrative and middle-management personnel, aiming to lower overall employee costs to below $45 million, a 25% decrease year-over-year [1] - Mynd.ai is also looking to relocate its SAAS development team from North America and Western Europe to Asia to significantly reduce software development costs [1] Financial Metrics - Mynd.ai currently has a market capitalization of approximately $28 million, equating to a price-to-sales ratio of 0.15 [1] - If the planned initiatives are successfully executed, the company is expected to experience a turning point in performance and stock price by 2026 [1]

Core Viewpoint - NetDragon's business remains stable despite facing challenges in the first half of 2025, with a focus on optimizing operations and improving cost efficiency, leading to a 15.6% year-on-year reduction in overall operating expenses [1][3]. Financial Performance Summary - Total revenue for the first half of 2025 was RMB 2.38 billion, a decrease of 27.9% year-on-year [1]. - Revenue from gaming and application services was RMB 1.74 billion, accounting for 73.0% of total revenue, down 18.1% year-on-year and 4.3% quarter-on-quarter [2][5]. - Revenue from Mynd.ai was RMB 640 million, representing 26.9% of total revenue, a significant decline of 45.7% year-on-year due to economic uncertainties [2][9]. - Gross profit was RMB 1.66 billion, down 24.7% year-on-year, with a gross margin increase of 2.9 percentage points to 69.5% [3]. - Profit attributable to shareholders was RMB 30 million, a decrease of 92.5% year-on-year, primarily due to impairment losses on intangible assets and one-time expenses related to personnel restructuring [3][10]. Strategic Initiatives - The company is committed to long-term sustainable growth and value creation, with a focus on AI integration in gaming and education sectors [1][7]. - The board approved an interim dividend of HKD 0.5 per share, a 25% increase year-on-year, and plans to distribute at least HKD 600 million to shareholders over the next 12 months [1][3]. - In gaming, the company is enhancing user engagement through the flagship IP "Magic Domain" and expanding its international presence with successful projects [1][5]. - In education, the company is restructuring its domestic education technology business to focus on key AI technology service projects and vocational education [7][9]. Mynd.ai Business Overview - Mynd.ai's revenue for the first half of 2025 was RMB 640 million, down from RMB 1.18 billion in the same period last year, reflecting budget cuts and reduced spending due to economic uncertainty [9][10]. - The company is focusing on enhancing its product offerings with the launch of next-generation integrated solutions and has signed an agreement to acquire award-winning AI voice assistant technology [10].

（原标题：网龙(00777)：Mynd.ai中期取得收入8927.2万美元） 智通财经APP讯，网龙(00777)发布非全资附属公司Mynd.ai , Inc.(Mynd.ai)截至2025年6月30日止6个月业 绩，收入8927.2万美元;净亏损2889.2万美元，同比收窄39.57%;每股普通股净亏损0.06美元。 ...

Financial Performance - In the first half of 2025, the company reported revenue of 2.38 billion RMB and gross profit of 1.66 billion RMB, with a gross margin increase of 2.9 percentage points to 69.5% year-on-year [1] - Operating expenses decreased by 15.6% year-on-year to 1.35 billion RMB, reflecting the effectiveness of cost optimization and efficiency improvement measures [1] Business Operations - The gaming business is undergoing a "long-term operation plan" with stable performance, despite short-term revenue fluctuations, showing only a slight decline in revenue quarter-on-quarter [1] - The Mynd.ai business faced challenges due to increased tariffs and weak demand in core markets, but the company is focused on optimizing operations and improving cost efficiency [1][2] Shareholder Returns - The board approved an interim dividend of 0.5 HKD per share, a 25% increase year-on-year, and plans to distribute no less than 600 million HKD to shareholders through dividends and share buybacks over the next 12 months [2] Strategic Initiatives - The company is embracing the AI era, implementing "AI + gaming" and "AI + education" strategies, with gaming and application services revenue of 1.74 billion RMB in the first half of 2025, down 18.1% year-on-year [2] - The flagship IP "Magic Domain" is enhancing content quality and engaging in various cultural and social projects to boost user activity [2] Product Development - The new product "Code MY" has begun small-scale testing, and the mobile game "Code Alpha" will expand into multiple overseas markets [3] - The company plans to leverage its AI production center to launch multilingual versions of its flagship IP and has successfully entered the mini-game market with "Magic Domain Legend" [3] AI Integration - The company has introduced leading domestic AI model firm Zhongke Wenge as a strategic shareholder to assist its AI transformation [4] - Collaborative AI applications have been developed, marking a significant step for Chinese core AI technology to enter international markets [4]

Core Insights - The United Nations held a high-level expert group meeting in New York to establish an online university for Least Developed Countries (LDCs), where Dr. Liu Dejian, founder and chairman of NetDragon, presented the "AI + Education" model to promote global educational equity and quality [1] - NetDragon signed a strategic cooperation agreement with UNESCO-ICHEI to collaborate on smart classrooms, AI courseware, and micro-credential development, aiming to support the digital transformation of higher education in developing countries [1] Group 1: AI + Education Strategy - NetDragon plans to provide high-quality teaching content and immersive self-exploration learning environments through its AI production center, targeting millions of active users globally [2] - The company's AI + strategy aligns with two major trends: the evolution of the gaming industry towards digital twin infrastructure and the transformation of educational technology into a cognitive revolution [2] - The AI production center has already integrated neural network algorithms into game NPC behavior and educational content generation, enhancing efficiency by 30-60% in game production processes [3] Group 2: EDA Education Metaverse - The EDA education metaverse platform will serve as the main hub for delivering immersive educational experiences across various subjects and learning stages [3] - The platform will utilize blockchain technology to create a decentralized learning community, where participants' contributions are recorded and converted into verifiable digital rights [3] - A dual incentive system combining digital assets and achievement badges will encourage continuous engagement and growth among global education participants [3] Group 3: Broader AI + Education Initiatives - NetDragon's subsidiary Mynd.ai, which owns the Promethean brand, is positioned to become a key platform for AI + education content and software [4] - The company's investment in AR firm Rokid, which recently launched AI glasses, introduces a new paradigm of "metaverse + vocational training" [4] - Institutional investors are reassessing NetDragon's valuation based on its AI capabilities, with a current dynamic P/E ratio approximately 40% lower than the median of the Hong Kong tech sector, alongside a consistent 18-year dividend payout history [4]

Core Viewpoint - NetDragon (00777) is accelerating its global expansion in the "AI + Education" sector, aiming to reshape global education models and establish itself as an industry leader [1] Group 1: Company Leadership and Recognition - Dr. Liu Dejian, founder and chairman of NetDragon, was invited as the sole corporate representative to the "United Nations Online University" meeting, reflecting the company's strong leadership position in the international education market [1] - The invitation also signifies international recognition of Dr. Liu's strategic vision and NetDragon's robust R&D capabilities [1] Group 2: AI + Education Strategy - NetDragon's EDA strategy aims to create a borderless educational community, promoting a more equitable and high-quality education system globally, focusing on three main aspects: AI production center, 3E high-quality educational content, and EDA education metaverse platform [6] - The company has already implemented the "AI + Education" model in global educational scenarios, with a recent collaboration with Thailand's Ministry of Higher Education to launch the AI education platform MHESI Skill [6][12] Group 3: Market Potential and Growth - The AI + Education market is expected to exceed 300 billion yuan, driven by the rapid adoption of educational information technology and online education, particularly accelerated by the COVID-19 pandemic [8] - AI's integration into education enhances various processes, including lesson preparation, teaching, assessment, and management, benefiting both teachers and students [8] Group 4: Policy Support and Industry Dynamics - Recent policies from the Ministry of Education and other departments promote the digitalization of education and encourage AI's application across all educational sectors, further stimulating market growth [9] - NetDragon is positioned as a leader in the AI education sector, with a comprehensive product lineup and a strong global competitive advantage [11][14] Group 5: Future Outlook and Financial Implications - The company's strategic deployment of AI + Education is expected to lead to a significant revaluation of its business, with ongoing developments in both AI education and AI gaming sectors contributing to cash flow and core profits [7][14] - The anticipated explosion of AI applications in 2025 will further solidify NetDragon's competitive edge in the education market [13]

Core Viewpoint - NetDragon reported a 14.8% year-on-year decline in revenue for the fiscal year ending December 31, 2024, despite a significant growth of 356% in its education services business [3][4]. Group 1: Financial Performance - Total revenue for NetDragon in 2024 was RMB 6 billion, down from the previous year [3]. - Gross profit decreased by 10.4% to RMB 3.9 billion, while net profit attributable to shareholders fell by 43.5% to RMB 311 million [3]. - The company recorded a net profit of RMB 114 million, a decline of 74.4% year-on-year [3]. - The gaming and application services segment generated RMB 3.9 billion, accounting for 65.1% of total revenue, down 6.0% [3]. - Revenue from the overseas education subsidiary Mynd.ai was RMB 2.1 billion, representing 34.8% of total revenue, a decrease of 27.6% [3]. Group 2: Business Segments - Mynd.ai's revenue decline was attributed to challenges in the global education market, while the company is transitioning from a hardware supplier to a leader in the "Classroom as a Service" (CaaS) sector [5]. - Mynd.ai's education device sales revenue was RMB 1.77 billion, down 37.5%, while education services revenue surged to RMB 333 million, up 356% [4][5]. - Mynd.ai reported a loss of RMB 279 million, but this represented an 11.4% reduction in losses compared to the previous year [4]. Group 3: Strategic Initiatives - The implementation of the "AI+ strategy" improved operational efficiency, reducing employee costs by nearly RMB 100 million [4]. - The company optimized its capital structure, leading to a 19.1% increase in pre-tax profit to RMB 756 million [4]. - Net cash increased by 13.3% to RMB 2.1 billion, with stable operating cash flow of RMB 1.1 billion [4]. Group 4: Workforce and Corporate Actions - The number of employees increased from 5,984 at the beginning of the year to 6,123 mid-year, but decreased to 4,593 by year-end [5]. - The company completed the sale of non-strategic early education business in October 2024, which helped repay some debt and optimize cost structure [5]. - NetDragon announced a final dividend of HKD 0.50 per share, totaling approximately RMB 246 million [6].