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Core Viewpoint - The Hang Seng Tech Index has shown a strong performance, with a year-to-date increase exceeding 6%, driven primarily by advancements in AI technology [1] Group 1: Market Performance - On January 6, the Hang Seng Tech Index surged over 2% during early trading, with leading stocks such as SenseTime and JD Health contributing to the gains [1] - The overall sentiment in the Hong Kong tech market is being significantly influenced by AI developments, as evidenced by the recent IPO of Biren Technology, known as the "first domestic GPU stock," which has reignited investor interest in the tech sector [1] Group 2: Market Dynamics - The debate surrounding the "AI bubble" has persisted through Q4 2025, with the Hang Seng Tech Index experiencing a prolonged period of volatility and adjustment, leading to a return of index valuations to historical lows [1] - However, with the iterative optimization of AI models and products by major internet companies, market confidence has begun to recover [1] Group 3: Investment Opportunities - The Hang Seng Tech Index ETF (513180) focuses on core Chinese AI assets, combining both hardware and software technologies, and includes major holdings such as Alibaba, Tencent, Xiaomi, Meituan, SMIC, and BYD [1] - This ETF ranks first in terms of scale among those tracking the Hang Seng Tech Index, indicating strong liquidity and investor interest [1]

Summary of SenseTime Conference Call Company Overview - **Company**: SenseTime (0020.HK) - **Industry**: Generative AI and Technology Key Points Generative AI Product Launches 1. **AI Drama Generation Platform (Seko 2.0)**: - Launched to assist short drama and motion comic creators - Production time reduced by 80%-90% compared to traditional methods - Subscription pricing ranges from Rmb39 to Rmb195 per month based on usage [8][9] - Expected to enhance monetization due to expanding market and affordability [8] 2. **AI Office Assistant (Racconn 3.0)**: - Key upgrades include one-click presentation generation, improved understanding capabilities, and integrated workflow for cross-platform task processing - Pricing starts at Rmb29.9/month for consumers and Rmb1,599/month for businesses [9] - Anticipated growth in the office software market to reach US$17 billion by 2030, with generative AI features expected to drive incremental revenues [9] 3. **AI Marketing Agent (SenseAvatar)**: - Designed to improve live commerce efficiency with multiple AI agents for various functions (e.g., store management, digital human cloning, traffic monitoring) - Pricing based on subscription or project fees for customized solutions [10] - Aims to enhance client productivity and drive revenue through tailored solutions [10] Financial Performance and Projections - **Generative AI Revenue Contribution**: - 77% in 1H25, expected to rise to 91% by 2030 [1] - **Revenue Forecast**: - Projected revenues of Rmb3,772.1 million in 2025, increasing to Rmb8,549.9 million by 2027 [16] - **Valuation**: - 12-month price target set at HK$3.53, with a potential upside of 73% from the current price of HK$2.04 [16][14] Risks - Potential risks include slower-than-expected customer adoption of generative AI, lower customer spending, and increased market competition [15] Market Context - The generative AI market is experiencing rapid growth, with significant opportunities in various sectors, including entertainment, office productivity, and marketing [1][8][9][10] Additional Insights - The company is leveraging its open-source LightX2V framework to support cost-effective AI video creation [8] - The focus on specific scenarios for product launches indicates a strategic approach to market segmentation and customer needs [10]

Summary of Key Takeaways from the Corporate Day on AI and LLM in Beijing Industry Overview - The LLM (Large Language Model) market competition remains intense, but there is optimism for AI monetization, particularly in the vertical enterprise market [1] Company-Specific Insights iFlytek (002230 CH, Neutral) - The consumer business is identified as the core growth engine, contributing about one-third of total revenue in 1H25, driven by strong momentum from learning machines [5] - Management expects the consumer business and education sector to be the main growth drivers, supported by the "Spark" LLM platform [5] - iFlytek is noted as potentially the only large LLM in China trained on domestic AI chips, allowing it to secure orders from government and state-owned enterprises (SOEs) [5] - The "Spark" LLM platform is projected to generate approximately CNY1 billion in revenue for FY25E [5] Kingsoft Cloud (3896 HK, Buy) - AI computing power demand is accelerating, with Xiaomi's LLM training and inference demand in smartphones and electric vehicles (EVs) being major growth drivers [4] - Management anticipates FY25F revenue growth to exceed 20% year-on-year, although gross profit margin (GPM) will be under pressure due to increased leased computing [5] - The company expects computing power assets to increase by approximately CNY9 billion, including both self-purchased and leased assets [5] Fourth Paradigm (6682 HK, Not rated) - Aiming for CNY20 billion in revenue by 2029E, with a focus on enterprise-level AI service platforms [6] SenseTime (20 HK, Not rated) - Generative AI is the main revenue growth driver, contributing 70%-80% of total revenue [8] - The company is committed to building full-stack AI capabilities and has released multimodal LLMs [9] Yonyou Network (600588 CH, Neutral) - Domestic substitution and large enterprises' AI migration are key growth drivers, with AI agents integrated into ERP systems [12] - Management expects steady revenue growth and significant cash flow recovery in 2025 [15] Qihu 360 (601360 CH, Not rated) - Revenue for 9M25 reached CNY6.1 billion, up 8% year-on-year, with a focus on "AI + Security" [13] - The company is shifting towards SaaS security, which now accounts for 30% of security revenue [17] Youdao (DAO US, Not rated) - Positioned as an AI-powered solutions provider, with online marketing services as the largest revenue contributor at 45% [18] - The company has achieved 5x growth in online marketing services over the past 3-4 years, driven by programmatic advertising [19] Additional Insights - The public cloud and enterprise cloud segments account for approximately 70% and 30% of revenue, respectively, with AI cloud being the fastest-growing segment [5] - Management noted that the demand for AI products is expected to drive revenue growth across both consumer and enterprise segments [11] - The overall macro environment remains challenging, but the penetration rates for AI solutions in enterprises are still low, indicating potential for growth [10] Conclusion The corporate day highlighted the competitive landscape of the AI and LLM market in China, with various companies showcasing their growth strategies and revenue projections. The focus on consumer and enterprise applications of AI, along with the integration of LLMs into existing business models, presents significant opportunities for growth in the coming years.

Core Insights - 36Kr Holdings Inc. successfully hosted the WISE 2025 Business Kings Conference, which redefined traditional business conference formats and attracted significant media attention with over 500 million views [1][2][11] Event Overview - The WISE 2025 conference took place on November 27-28, 2025, in Beijing's 798 Art District, featuring a unique seven-act agenda inspired by short plays [1][3] - The event gathered business leaders and innovators from various sectors, including intelligent hardware, artificial intelligence, life sciences, retail, and investment [1][2] Key Highlights - The conference featured a mass-participation AI short play titled "Forging the Dawn," showcasing AI's advancements in creative generation [3] - A live demonstration of Unitree Technology's G1 humanoid robot set a tone of technological innovation for the event [3] Thematic Acts - **Act 1: New Beginnings 2025 and 2035** - Executives shared entrepreneurial journeys and launched Houmo.AI's M50 chip [4] - **Act 2: Challengers and the Tech Wave** - Discussions on technological disruption and the evolution of AI for Science [5] - **Act 3: Embodied Artificial Intelligence** - In-depth discussions on defining embodied AI and its applications [5] - **Act 4: Brand Building** - Introduction of the "Three Constants" brand-building theory and the "Future Super Chinese Brands List" [6] - **Act 5: Tech-empowered Innovation in Consumer Goods** - Showcasing how AI is reshaping the marketing value chain [7] - **Act 6: Global Expansion and Synergy** - AI applications in global expansion scenarios discussed by industry leaders [9] - **Act 7: Outlook on the New Tech Era** - Insights on generational consumption drivers and the computing power revolution [9] Recognition and Support Initiatives - 36Kr unveiled the WISE 2025 Business Kings Annual Honors Lists, recognizing notable figures in China's capital markets [10] - The company launched the IPO Acceleration Camp in partnership with Zhong Lun Law Firm, providing a structured support framework for enterprises [10] Future Commitment - 36Kr aims to deepen its engagement in the industrial ecosystem, focusing on long-term commitment, tech-driven advancement, and innovation [11] - The company plans to support entrepreneurs and help investors identify long-term value opportunities through various initiatives [11]

Company Overview - Biren Technology, a Chinese AI chip startup founded in 2019, is planning to launch an initial public offering (IPO) in Hong Kong, aiming to raise approximately $300 million [1][2] - The company was co-founded by Zhang Wen, a former president at SenseTime, and Jiao Guofang, who has experience with Qualcomm and Huawei [5] IPO Details - Biren plans to issue up to 372.5 million shares in Hong Kong, converting 873.3 million onshore shares into Hong Kong-listed stock [3] - The IPO could commence as early as December 2023, with a potential debut in January 2024 [2] Industry Context - The IPO is part of China's broader strategy to develop domestic semiconductor alternatives in response to U.S. export restrictions on advanced chips [2][4] - Biren's planned offering follows successful IPOs from competitors like Moore Threads and MetaX, which were significantly oversubscribed [4] Financial Background - Prior to a funding round in the first half of 2025, Biren was valued at approximately 14 billion yuan ($2 billion) after raising about 1.5 billion yuan from various investors, including government entities [6] - Key investors include Qiming Venture Partners, IDG Capital, and the venture arm of Hillhouse Investment [7] Product Development - Biren gained attention in 2022 with the launch of its BR100 chip, which claims to match the performance of Nvidia's H100 AI processor [5] - The company has faced challenges, including being added to the U.S. 'Entity List' in 2023, which restricts its ability to use TSMC for chip manufacturing [6]

Summary of China Software 3Q25 Result Review Industry Overview - The report focuses on the **China Software** industry, specifically analyzing the performance of various software companies in the third quarter of 2025 (3Q25) and updating estimates based on recent trends. Key Points Overall Performance - Average revenue growth for the covered companies was **4% YoY** in 3Q25, a decline from **9% in 1H25** [1] - Average net margin improved to **3% in 3Q25**, compared to **-3% in 1H25**, indicating enhanced efficiency and profitability among software companies [1] Company-Specific Highlights - **Kingsoft Office**, **Thundersoft**, and **Arcsoft** showed strong revenue growth driven by increased demand for AI products, despite overall soft IT spending [1] - **iFlytek**, **Sangfor**, and **Glodon** experienced net income recovery in 3Q25 due to productivity improvements [1] Management Insights - Management teams expressed optimism regarding enterprise and government spending on AI applications, AI agents, and AI models to enhance productivity and creativity [1] - Despite positive sentiments, the report maintains a **Sell rating** on **ZWSOFT**, **Glodon**, **Thundersoft**, and **Sangfor**, primarily due to valuation concerns [1] Valuation Metrics - The average P/E ratio for China software companies is around **55x-60x**, compared to a five-year average of **59x** [2] - The average EV/Sales ratio remains at **8x-9x**, lower than the 2020-21 average of **12x-18x** [2] Individual Company Performance - **Glodon**: Revenue increased by **4% YoY** to **Rmb1.5 billion**, driven by construction management and design software growth. However, the company faces weak momentum in new construction projects [11] - **ZWSOFT**: Revenue remained flat YoY at **Rmb204 million**, attributed to weak end demand in the China market. Management expects slight recovery in 4Q25 [22] - **Thundersoft**: Revenue grew **43% YoY** to **Rmb1.848 billion**, driven by IoT software and automotive software growth. The company is focusing on next-generation automotive OS and AI edge solutions [30] - **Sangfor**: Revenue growth of **10% YoY** to **Rmb2.116 billion**, attributed to strong demand for cloud computing solutions. The company launched new AI platforms to enhance efficiency [37] Earnings Revisions - **Glodon**: Net income estimates revised down by **6%** for 2025-28E due to lower construction-cost software revenues and higher operating expenses [16] - **ZWSOFT**: Net income estimates revised down by **18%** for 2025-27E due to lower revenues and gross margins [26] - **Thundersoft**: Earnings revised down by **15%** for 2025-27E, mainly due to lower revenue in smartphone software [33] - **Sangfor**: Earnings revised up by **1%** for 2025-27E, reflecting better-than-expected cost management [40] Future Outlook - Management of **Glodon** expects the new code of bills in the construction market to support revenue growth, while **ZWSOFT** anticipates recovery driven by overseas business growth and new client penetration [20][22] - **Thundersoft** is optimistic about opportunities from AI edge devices and the next generation of automotive OS [30] Conclusion - The China Software industry is experiencing mixed performance, with some companies benefiting from AI-related demand while others face challenges. Valuation concerns persist, leading to cautious outlooks for several firms despite positive management sentiments regarding future growth opportunities.

Summary of China Software Industry Conference Call Industry Overview - The China software industry experienced a revenue growth of **15.1% YoY** in September 2025, maintaining the same growth rate as August 2025, with a **12% MoM** increase [1][10] - Cumulative revenues for the first nine months of 2025 (9M25) grew by **13% YoY**, compared to **10.8% YoY** in 9M24 [1][19] - The software industry is showing signs of recovery in IT spending, particularly in AI software and productivity tools [1][10] Key Financial Metrics - The net margin for the software industry dropped to **7.9%** in September 2025 from **17.4%** in August 2025, leading to a 9M25 net margin of **12.9%** [19][26] - The total revenue for the software industry in September was approximately **Rmb 1.5 trillion (US$204 billion)** [19] - The revenue from non-China markets decreased to **2.7%** of total revenue, down from **3.5%** in August 2025 [19] Segment Performance - IT services accounted for **69%** of total revenues in 9M25, followed by software products at **21%** and embedded system software at **8%** [19][29] - Specific segments such as semi design, cloud computing, and big data showed strong performance in September [2] AI Product Momentum - The monthly active users (MAU) of major AI productivity tools and AI video/image editing tools outperformed expectations in October 2025 [2][7] - Companies like **Kingsoft Office** and **Sensetime** are highlighted as strong performers in their respective segments [3] Market Sentiment and Outlook - The Small and Medium Business (SMB) Purchasing Managers' Index (PMI) decreased to **47.1** in October 2025 from **48.2** in September, indicating a cautious spending environment [10][12] - Despite the decrease in PMI, there is an expectation of improved IT spending in the fourth quarter of 2025, particularly on AI and productivity-enhancing technologies [10] Notable Company Performances - **Kingsoft Office** reported a **25% YoY** revenue increase in 3Q25, while **Thundersoft** saw a **43% YoY** increase [9] - **Hundsun** experienced a **21% YoY** decline in revenue for 3Q25, indicating challenges in the finance IT segment [9] Additional Insights - The software industry is facing near-term margin pressures but is expected to improve with enhanced employee efficiency [12][13] - The overall sentiment in the market reflects a prioritization of spending on core business operations and innovative AI solutions due to external uncertainties [2][10] This summary encapsulates the key points discussed in the conference call regarding the China software industry, highlighting growth metrics, segment performance, and market outlook.

Summary of Cambricon's Conference Call Company Overview - **Company**: Cambricon (688256.SS) - **Industry**: AI Chip Manufacturing Key Points Financial Performance - **3Q25 Revenue**: Rmb1.7 billion, up 1333% YoY, consistent with 2Q25 levels, and close to Bloomberg consensus estimates [4][8] - **9M25 Revenue**: Rmb4.6 billion, nearing the low-end of the 2025 revenue guidance of Rmb5 billion [1] - **4Q25 Revenue Projection**: If high-end guidance of Rmb7 billion is achieved, 4Q25 revenues could increase by 39% QoQ to Rmb2.4 billion [1] - **Gross Margin (GM)**: Decreased to 54% in 3Q25 from 56% in 2Q25, reflecting a shift in product mix from government projects to enterprise clients [4][10] - **Operating Expenses (Opex)**: Ratio improved to 21%, better than consensus estimates, with R&D expenses increasing by 12% QoQ [7][10] Strategic Partnerships - **Sensetime Cooperation**: A strategic agreement signed in October 2025 to leverage technical advantages in AI chips and foundation models, aiming to enhance product compatibility and accelerate AI deployment [2] - **Zhipu Collaboration**: Zhipu's new GLM-4.6 model successfully deployed on Cambricon's AI chips, marking a significant achievement in local chip production [3] Market Dynamics - **Contract Liability**: Reduced to Rmb80 million in 3Q25 from Rmb543 million in 2Q25, indicating improved cash flow management [1] - **Inventory Increase**: Inventory rose by 39% QoQ, suggesting strong market demand and effective wafer supply management [1] Future Outlook - **Revenue Guidance**: Analysts have raised 2025E net income estimates by 8% due to better-than-expected cost control [10] - **Target Price**: Maintained at Rmb2,104, reflecting a 68.6% upside potential from the current price of Rmb1,247.68 [16][14] Risks - **Supply Chain Risks**: Potential wafer supply restrictions due to Cambricon being added to the US Entity List in December 2022 [15] - **Competition**: Increased competition in the cloud chips market could impact future growth [15] Additional Insights - **R&D Capability**: Recognition of Cambricon's strong R&D capabilities, as evidenced by passing compatibility tests with other leading AI models [3] - **Cost Control**: Effective cost management strategies have led to a significant improvement in operating income, exceeding analyst expectations [7][10] This summary encapsulates the essential insights from Cambricon's conference call, highlighting its financial performance, strategic partnerships, market dynamics, future outlook, and associated risks.

Group 1: Strategic Collaboration - Cambricon Technologies and SenseTime are collaborating to enhance China's self-reliance in AI infrastructure, aiming to create a new indigenous AI development paradigm [1][2] - The partnership will combine SenseTime's foundational models with Cambricon's AI processors to develop AI computing solutions and vertical enterprise services [3] Group 2: National Priorities and Market Context - The Chinese government has prioritized self-reliance in AI, encompassing integrated circuits and AI models, as part of its 15th five-year plan [2] - Cambricon, known as "little Nvidia," has seen its stock price increase fivefold over the past year, reflecting strong market interest [4] Group 3: Financial Performance - Cambricon reported a remarkable 4,348% year-on-year increase in first-half revenue, reaching 2.88 billion yuan (approximately US$404.8 million) [5] - SenseTime experienced an adjusted loss of 1.16 billion yuan in the first half, impacted by previous US sanctions [5] Group 4: Technological Advancements - SenseTime has released several foundational models, including the SenseNova V6.5, and emphasizes its strengths in computer vision technology [6]