Core Viewpoint - The company reported a 5% year-on-year earnings growth in Q3 2025, aligning with estimates despite slower service revenue growth, and is increasing CAPEX investment to capitalize on the demand for domestic IP AI cloud services [1][3]. Financial Performance - Q3 2025 earnings rose by 5.3% year-on-year to RMB 5.5 billion, with stable EBITDA and margin compared to the previous year [1]. - Service revenue increased by 0.2% year-on-year to RMB 83.3 billion, while depreciation and amortization costs decreased by 3.4% year-on-year to RMB 20.1 billion [1]. - The decline in depreciation costs is attributed to stringent CAPEX spending over the last two years, marking a reduction for the last eight quarters [1]. Investment and R&D - The company is focusing on key technologies such as next-gen Internet, Big Data, artificial intelligence, and cybersecurity, leading to a 5.9% year-on-year increase in R&D expenses [2]. - CAPEX for Cloud and computing power in 2025 is expected to rise by 28% year-on-year to RMB 18 billion, driven by aggressive price competition in the market [3]. Market Outlook - The 2025 General Purpose Server centralized tender was announced for approximately RMB 6 billion, with vendors offering discounts of 30-40% compared to list prices [3]. - The company maintains a target price of HK$ 15.02, with projected cloud revenue of RMB 82.3 billion and group EBITDA of RMB 105.29 billion, sustaining a 2x P/S for cloud and 2.8x EV/EBITDA [3].