Core Viewpoint - China Wangwang's stock price fell over 5% following the release of its mid-term performance report, which showed a revenue increase but a decline in net profit, leading to multiple institutions lowering their target prices [2][6]. Financial Performance - For the first half of the 2025 fiscal year, China Wangwang reported revenue of 11.108 billion RMB, a year-on-year increase of 2.1%, while net profit attributable to shareholders was 1.717 billion RMB, down 7.8% [2][3]. - The revenue growth was primarily supported by the dairy and beverage segment, which accounted for 53% of total revenue, and the rice snacks and leisure foods segment, which accounted for 46% [3][4]. Product Performance - The dairy and beverage segment generated 5.9413 billion RMB, a decrease of 1.1% year-on-year, largely due to a low single-digit decline in sales of Wangzai milk [3][4]. - The rice snacks category saw a revenue increase of 3.5% to 2.13 billion RMB, with sales growth in emerging channels achieving double-digit growth [4]. Marketing and Expenses - Overall operating expenses increased by 10.6%, attributed to higher promotional costs for new products and channels following organizational restructuring [6]. - Despite the increase in revenue from new products, the associated advertising costs have negatively impacted net profit [5][6]. Market Reactions - Following the mid-term report, several institutions, including Morgan Stanley and Bank of America, downgraded their target prices for China Wangwang, citing concerns over profitability and market conditions [6][7].