Core Viewpoint - The company reported steady revenue growth and significant profit increase in the first half of 2025, driven by both classic and innovative game offerings [1][2]. Group 1: Financial Performance - In the first half of 2025, the company achieved revenue of 2.578 billion yuan, a year-on-year increase of 0.89% [1] - The net profit attributable to shareholders reached 950 million yuan, reflecting a year-on-year growth of 17.41% [1] Group 2: Product Development and Innovation - The company focused on the classic "Legend" category and launched several new products, including "Dragon Valley World" and "Digital Monster: Source Code," which performed well in app store rankings [1] - The company has multiple new titles approved for release, expected to launch in the second half of this year and early next year [1] Group 3: Market Position and Strategy - Industry experts believe that the launch of new products by leading companies will significantly impact the competitive landscape as the industry recovers [2] - The company is diversifying its product portfolio to mitigate risks associated with single-category reliance and enhance its resilience against market cycles [2] Group 4: Global Expansion - The company reported overseas revenue of 202 million yuan in the first half of 2025, marking a year-on-year increase of 59.57% [2] - The RPG title "MU Immortal" topped the iOS RPG free charts in multiple countries, indicating strong international performance [2] Group 5: IP Strategy - The company is diversifying its IP strategy by developing original IPs and incorporating well-known IPs like "King of Fighters" and "Ultraman" into its offerings [3] - The focus is on creating a multi-channel distribution strategy to reach a broader audience across different age groups [3]

Investment Rating - The report maintains an "Accumulate" rating for the company [2][5]. Core Views - The company has shown a significant increase in revenue and has turned its net profit positive in Q1 2025, indicating a performance inflection point [3][8]. - The company is actively expanding its product matrix, including AMOLED DDIC, touch chips, automotive display timing control chips, and micro-display products for AR glasses [3][8]. - A strategic acquisition of Aisheng is planned to enhance the company's industrial ecosystem and R&D capabilities [3][8]. Financial Summary - The company’s revenue is projected to grow from RMB 480 million in 2023 to RMB 1,542 million by 2027, reflecting a compound annual growth rate (CAGR) of approximately 34.2% [7]. - The net profit is expected to recover from a loss of RMB 28 million in 2024 to RMB 151 million in 2027, with a significant growth rate of 226.2% in 2025 [7]. - The estimated earnings per share (EPS) for 2025 is revised down to RMB 0.06, with further increases expected to RMB 0.33 by 2027 [5][7]. Market Performance - The company's stock has shown a year-to-date increase of 5.5% and a 12-month increase of 83.2%, outperforming the Shanghai Composite Index [2]. - The total market capitalization of the company is approximately RMB 8.48 billion as of May 7, 2025 [2]. Product Development - The company is focusing on new product development in the display driver chip market, which is expected to see a gradual recovery, with a global market size of approximately USD 11.13 billion in 2024 [8]. - The company’s R&D expenses are projected to increase by 15% year-on-year, indicating a commitment to innovation and product development [8].