Group 1 - The core viewpoint is that the domestic medical device sector is entering the end of an adjustment period, with expectations for a recovery in performance in the second half of 2025 [2] - In Q2 2025, the revenue of the medical device sector showed a year-on-year increase of 5.26%, while the net profit attributable to the parent company decreased by 27.93% [2] - The gross profit margin for the medical device sector fell from 53.07% in Q2 2024 to 49.00% in Q2 2025, a decrease of 4.07 percentage points, influenced by low procurement prices in county-level markets for mid-to-low-end products [2] Group 2 - The medical consumables sector experienced steady revenue growth, with a year-on-year increase of 1.33% in Q2 2025, indicating a stable demand linked to domestic patient treatment needs [2] - The net profit attributable to the parent company for medical consumables grew by 6.28%, and the gross profit margin improved slightly from 42.13% in Q2 2024 to 42.24% in Q2 2025, an increase of 0.11 percentage points [2] Group 3 - The in vitro diagnostics sector faced significant pressure, with a year-on-year revenue decline of 16.53% in Q2 2025, primarily due to the implementation of DRG and reduced unnecessary testing [3] - The net profit attributable to the parent company for in vitro diagnostics dropped by 37.58%, and the gross profit margin decreased from 62.43% in Q2 2024 to 59.66% in Q2 2025, a decline of 2.77 percentage points [3] - Despite short-term challenges, there is potential for an increase in domestic localization rates in the long term, with leading companies expected to gain market share [3] Group 4 - Investment recommendations focus on three areas: 1) Companies leading in international market product and channel expansion; 2) Leading domestic medical device companies; 3) High-value consumables companies with strong innovation capabilities benefiting from "anti-internal competition" [3]