Financial Performance - In 2024, the company reported a comprehensive sales gross margin of 20.47% and a net profit margin of 10.06% [1] - In Q1 2025, the comprehensive sales gross margin increased to 25.15%, with a net profit margin of 18.07% [2] - The significant decline in revenue in 2024 was attributed to intensified competition in overseas markets, slower new product rollout, increased expenses, and extended accounts receivable periods [2][3] Strategic Focus - In 2025, the company plans to reduce or eliminate its traditional display terminal business, with Q1 revenue primarily coming from the backlight module business [2][4] - The strategic focus for 2025 is on "focusing on core (modules), specializing, and moving up the industry," emphasizing the development of display module business and accelerating the automotive display sector [4] Growth Opportunities - The company anticipates a revenue growth of 40%-60% in display modules for 2025, aiming for a net profit of approximately 170 million yuan [4] - The display module business grew by 35% year-on-year in 2024, with MiniLED display modules experiencing a doubling in growth [5] - The automotive display business is identified as a second growth curve, with products already in the sampling phase and beginning mass shipments [6] Industry Outlook - The display industry is entering a rapid growth phase, driven by national subsidy policies and the accelerated penetration of MiniLED technology [5] - The global shipment volume in the large-size display market remains stable at around 200 million units, with the industry expected to expand further with advancements in MiniLED, MiniRGB, and MicroLED technologies [7][8]

Financial Data and Key Metrics Changes - The company generated $88 million in revenue and $57 million in cash from operations for Q1 2025, aligning with expectations [5] - The full year 2025 revenue outlook remains unchanged, with over 80% supported by contracted revenue [6] - Adjusted EBITDA for Q1 was $47.3 million, reflecting an adjusted EBITDA margin of 54% [20] - The company ended Q1 with $116.5 million in cash, cash equivalents, and marketable securities [21] Business Line Data and Key Metrics Changes - Recurring revenue for Q1 2025 increased modestly year over year, with non-pay TV parts of the business seeing a 25% increase [7][8] - The company signed 10 license agreements in Q1, including four with new customers in key growth areas such as social media, OTT, and semiconductors [8][9] - Renewals accounted for six agreements in Q1, maintaining a strong track record of over 90% renewal rates [12] Market Data and Key Metrics Changes - The company is focusing on growth in OTT, semiconductors, and adjacent media markets, with significant opportunities in the OTT sector due to its growing subscriber base [10] - The semiconductor market is seeing increased adoption of hybrid bonding, which is driving new deal flow [11] Company Strategy and Development Direction - The company emphasizes a balanced capital allocation strategy, focusing on growth through strategic acquisitions while maintaining a strong cash position [5][16] - The strategy includes expanding and diversifying patent portfolios to meet evolving market needs, with a focus on organic growth through R&D [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of the business model despite macroeconomic volatility, with visibility into revenue supported by long-term contracts [6] - The company is monitoring the broader macroeconomic environment and remains prudent in spending, anticipating potential impacts on future performance [25] Other Important Information - The company acquired two IP portfolios for $5 million, enhancing its media and semiconductor capabilities [15][22] - A new board member, Sandeep Vizh, was nominated to replace retiring board member Raghu Rao, bringing extensive expertise in technology and semiconductors [17] Q&A Session Summary Question: Potential for new sports league deals - Management is optimistic about the new deal with a U.S. Professional Sports League, viewing it as a potential breakthrough for future agreements [30][31] Question: Opportunities in sports betting - Management is exploring the sports gambling market as an adjacent opportunity, though it is considered a longer-term prospect [33] Question: Licensing status of acquired portfolios - The acquired micro LED and imaging portfolios do not currently have existing licenses attached, but management sees significant potential for future revenue [35] Question: Semiconductor announcement context - The recent semiconductor deal is not the large opportunity anticipated from the previous year, but it reflects ongoing progress in hybrid bonding adoption [40] Question: OTT market opportunities - The majority of OTT opportunities are domestic, with ongoing litigation affecting some potential deals, but international opportunities are also being pursued [41] Question: Social media market potential - The company has licensed approximately 90% of the social media market, with opportunities primarily in renewals rather than new deals [43]