Core Viewpoint - The company has released a revised response to the Shenzhen Stock Exchange regarding its application for issuing convertible bonds, detailing its business development and financial status. Financial Performance - The company's gross profit margin has declined over the past three years, with figures of 47.71%, 38.46%, and 33.25% for 2022, 2023, and 2024 respectively [2] - In Q1 2025, the company reported revenue of 58.76 million yuan, a year-on-year decrease of 24.20%, and a net profit of -13.95 million yuan, a decline of 526.51% [2] - Cash flow from operating activities showed significant volatility, with a net cash flow of -59.14 million yuan in 2023 due to increased employee numbers, while it improved to 115.72 million yuan in 2024 [2] Business Analysis - The decline in gross profit margin is primarily attributed to the custom software business, influenced by complex delivery processes for strategic clients, low margins on new business, and rising labor costs [3] - Sales to the top five clients have decreased as a percentage of total revenue since 2023, reflecting the company's efforts to expand its customer base and new business [3] - The company maintains stable and sustainable long-term relationships with its major clients, with no significant dependency on any single client [3] R&D and Internal Control - R&D expenses have fluctuated significantly, with amounts of 96.97 million yuan, 90.41 million yuan, 46.99 million yuan, and 43.63 million yuan over the past four years [4] - The company has clear standards for distinguishing R&D activities from production activities, ensuring accurate allocation of R&D costs [4] - Internal control systems related to contract performance are well-established and effectively executed [4] Future Outlook - Despite challenges such as declining gross margins and performance volatility, the company asserts it has normal cash flow and a reasonable asset-liability structure [5] - The company expects that its cumulative net cash flow from operating activities will cover its total working capital needs over the next three years [5] - Future strategies include focusing on innovation and intelligence, enhancing business layout, strengthening market leadership, increasing product R&D, and optimizing management systems to improve core capabilities [5]

Core Viewpoint - The company has been experiencing continuous losses since its establishment, primarily due to significant capital expenditures on cloud service infrastructure and high depreciation costs, which have not been offset by sufficient gross profit contributions [15][23][24]. Financial Performance - In 2024, the company reported operating revenue of 27,206.62 million yuan, a decrease of 18.95% compared to the previous year [1][15]. - The net profit attributable to shareholders was -9,575.77 million yuan, representing a reduction in losses by 43.72% year-on-year [1][15]. - As of the end of the first quarter of 2025, the company's net asset scale was 6,411.97 million yuan, continuing a downward trend since its listing [1]. Business Structure and Revenue - The company's main business includes cloud products and cloud services, with cloud products accounting for 53.48% of total revenue in 2024, an increase of 21.58 percentage points since 2021 [4][6]. - The sales revenue from cloud products decreased by 56.12% compared to 2021, primarily due to a strategic focus on high-margin software products and a reduction in low-margin hardware sales [6][15]. - The cloud service revenue showed a slight decline of 2.11% in 2024, but the gross margin improved due to the introduction of AI computing services [8][19]. Customer and Supplier Stability - The top five customers have remained stable since 2021, with significant contributions from long-term partnerships [17]. - The company has adjusted its supplier relationships to meet the demands of new AI computing services, indicating a responsive supply chain [10][17]. Market Position and Competition - The company ranks among the top six in the hyper-converged software market with a market share of 6.4% in 2024, reflecting its competitive positioning [18]. - Despite facing intense competition from larger players like Alibaba Cloud and Tencent Cloud, the company has established a solid reputation in sectors such as finance, energy, and education [18][22]. Strategic Adjustments - The company has implemented strategic adjustments to focus on high-margin business areas, optimize organizational structure, and reduce costs [24][25]. - Measures include enhancing the integration of proprietary software and core products, as well as streamlining personnel to improve efficiency [24][25]. Future Outlook - The company aims to improve its operational stability and reduce the risk of negative net assets, which could trigger delisting conditions [25][26]. - Continued investment in cloud computing product development is planned, although challenges remain in achieving profitability in the short term [23][24].

Group 1: Financial Performance - The company reported a revenue of 58.76 million yuan in Q1 2025, a decrease of 24.20% compared to the same period last year, and a decline of 2.4% compared to the average revenue of 60.22 million yuan from 2022 to 2024 [2][3] - The revenue from customized software is significantly high, with Q1 revenue historically accounting for a low percentage of annual revenue: 7.0% in 2022, 7.2% in 2023, and 9.3% in 2024 [2][3] - The company had an order backlog of 378 million yuan at the end of 2024, representing a year-on-year growth of 27.7% [3] Group 2: R&D and Product Development - In Q1 2025, the company increased its R&D investment in core products, with R&D expenses amounting to 26.18 million yuan, significantly impacting profits [3] - The company aims to continue promoting the development of core products, including the Xinchang ERP project and intelligent applications [4][5] Group 3: Strategic Development Goals - The company emphasizes the importance of intelligent and innovative opportunities for sustainable development, focusing on high-quality product development and service capabilities [4] - The strategy includes maintaining a focus on two key areas: deepening cooperation with strategic clients and expanding new group clients through high-quality delivery [4] - The company plans to adopt a "product + market" strategy to enhance the scale and quality of its specialized business areas, particularly in the Xinchang ERP series software [4][5] Group 4: Organizational Efficiency - The company intends to optimize resource allocation and enhance organizational collaboration to improve efficiency and cost control [6] - There will be a focus on improving the quality and structure of human resources to meet the demands of the intelligent era [6]