Investment Rating - The report does not explicitly state an investment rating for the industry or specific companies Core Insights - NVIDIA has announced the launch of NVQLink, a new architecture that connects quantum systems with classical computing systems, marking the beginning of the "quantum GPU computing era" [1][15] - The competition between NVIDIA and AMD has extended into the quantum computing domain, with NVIDIA collaborating with around 17 companies to develop NVQLink, while AMD has partnered with IBM to demonstrate quantum error correction on FPGA chips [2][16] - Nokia has re-emerged as a key player in the AI race due to NVIDIA's strategic investment, highlighting the importance of networking alongside computing power in building next-generation AI infrastructure [3][17][18] - Apple reported that iPhone 17 sales exceeded expectations, with strong momentum expected to continue into the next fiscal quarter, particularly in the Chinese market [4][19][20] - Chinese automakers, including BYD and XPeng, are rapidly deploying AI robots in manufacturing, focusing on enhancing production speed and efficiency to gain market share [7][21][22] - Hesai Technology has launched a low-cost LiDAR priced at $200, challenging the notion that reliance on LiDAR is doomed, and aims to make it a standard feature in vehicles [8][23][24] Summary by Sections Quantum Computing - NVIDIA's NVQLink architecture aims to interconnect quantum and classical computing systems, representing a significant advancement in quantum GPU computing [1][15] - AMD's collaboration with IBM has successfully demonstrated quantum error correction on FPGA chips, showcasing competitive advancements in the quantum domain [2][16] AI and Networking - NVIDIA's investment in Nokia signifies a strategic move to integrate computing and networking resources, emphasizing the growing importance of networking in AI infrastructure [3][17][18] Consumer Electronics - Apple's iPhone 17 has shown strong sales performance, with expectations of continued demand in the Chinese market, potentially impacting local smartphone brands [4][19][20] Automotive Industry - Chinese automakers are leading the deployment of AI robots in manufacturing, focusing on speed and efficiency to enhance production capabilities and market competitiveness [7][21][22] - Hesai Technology's introduction of a $200 LiDAR aims to challenge existing perceptions in the autonomous vehicle market and promote wider adoption [8][23][24]

Core Viewpoint - Apple's revenue in Greater China has declined again after a brief improvement, marking it as the only market with a revenue drop globally in the fourth quarter of fiscal year 2025 [1][2][10] Financial Performance - In Q4 FY2025, Apple's total net revenue was $102.47 billion, up 8% from $94.93 billion year-on-year; net profit was $27.47 billion, an increase of 86% from $14.74 billion; diluted earnings per share rose to $1.85 from $0.97 [2] - Revenue in Greater China was $14.49 billion, down 3.6% from $15.03 billion year-on-year, contrasting with growth in other regions [2][10] Reasons for Revenue Decline - CEO Tim Cook attributed the decline in Greater China to supply constraints affecting iPhone sales, specifically that the estimated production of the iPhone 16 series was slightly below actual demand [4][10] - Experts suggest that the decline is due to both internal and external pressures, including limited upgrades in iPhone models and strong competition from local brands like Huawei [6][7][10] Competitive Landscape - The Chinese smartphone market is becoming increasingly competitive, with local brands rapidly innovating in areas like foldable screens and fast charging, providing consumers with more choices [6][10][11] - Huawei's return has significantly impacted Apple's market share in the high-end segment, as it rebuilds its brand loyalty and technological confidence [10][13] Product Launch Challenges - The delayed launch of the iPhone Air, which only supports eSIM and faced compatibility issues with local carriers, directly affected sales in Q4 [7][9] - User feedback on the iPhone Air has been mixed, with concerns about its features and durability, leading to lower-than-expected demand [9] Future Outlook - Despite current challenges, Apple maintains a strong brand influence and loyal customer base, with potential for recovery if it accelerates innovation and optimizes pricing strategies [10][13] - The competitive landscape is shifting, and Apple must adapt to maintain its market position in China [10][13]

Group 1 - Xiaomi Group has seen a net buy of HKD 1.029 billion, with a total of HKD 19.1269 billion net bought over four consecutive days [1] - CNOOC reported a net buy of HKD 0.993 billion, totaling HKD 16.0304 billion net bought over three consecutive days [1] - Tencent Holdings experienced a net sell of HKD 1.51 billion, with a total of HKD 19.9056 billion net sold over four consecutive days [1] Group 2 - Xiaomi's automotive division announced that it will deliver over 40,000 vehicles by October 2025, with a significant reduction in delivery times due to increased production capacity [3] - CNOOC's Q3 revenue reached CNY 104.895 billion, a year-on-year increase of 5.7%, while net profit decreased by 12.2% [3] - China Mobile, along with China Unicom and China Telecom, has received approval to conduct commercial trials for eSIM mobile services, which are expected to enhance user communication needs and provide opportunities for domestic software and systems [4]

Core Viewpoint - Xiaomi Group's stock price increased by 3.1%, reaching HKD 44.54, with a trading volume of HKD 48.38 billion, driven by positive news regarding its automotive division [1] Group 1: Automotive Performance - Xiaomi's official Weibo announced that by October 2025, the company expects to deliver over 40,000 vehicles consistently [1] - According to Guojin Securities, Xiaomi's automotive deliveries exceeded 290,000 units in the first ten months of this year, more than doubling last year's total [1] - Xiaomi's official Weibo also reported that the total payment amount across all channels surpassed HKD 18.2 billion by October 31, 2025 [1] Group 2: Market Sentiment and Innovation - Dongfang Securities noted that some investors express concerns about Xiaomi's technological innovation and execution capabilities, particularly regarding the sustainability of growth across its automotive and smart home businesses [1] - The firm believes that Xiaomi has significantly improved its competitiveness in new feature development and product manufacturing, establishing a stronger operational ecosystem [1] - Xiaomi's ability to innovate and scale its products is expected to continue enhancing, driving sustained growth across its automotive and smart home sectors [1]

Core Viewpoint - Xiaomi Group-W (1810.HK) shares increased by over 4%, reaching HKD 45.06, following the announcement of its automotive delivery plans for October 2025 [1] Delivery Plans - Xiaomi Automotive announced a continuous delivery volume exceeding 40,000 units by October 2025 [1] - The delivery cycle for various models has been significantly shortened compared to the original timeline: - YU7: Expected delivery in 35-38 weeks, shortened by 10 weeks - YU7 Pro: Expected delivery in 34-37 weeks, shortened by 8 weeks - YU7 Max: Expected delivery in 32-35 weeks, shortened by 4 weeks [1] - The reduction in delivery cycles is attributed to increased production capacity [1]

Market Overview - Global markets showed mixed performance, with the Hang Seng Index down 1.43% and the Shanghai Composite Index down 0.81%, while the US markets saw slight gains, particularly the Nasdaq which rose by 0.61% [1][3] - Southbound capital saw a net inflow of HKD 8.719 billion, with Xiaomi, Meituan, and 3SBio leading in net purchases, while Tencent and SMIC experienced significant net sales [3] Economic Insights - China's manufacturing PMI fell to its lowest level since 2008, indicating a further slowdown in economic activity for Q4, with expectations of policy easing from the central bank [4] - The real estate sector continues to face challenges, with a 16.3% year-on-year decline in sales for the top 100 property companies from January to October, and a further drop in second-hand housing prices [4] Industry Analysis - The CIS market is expected to grow by 6.4% in 2024, reaching USD 23 billion, driven by the adoption of automotive ADAS and emerging applications like smart glasses [4][5] - The competitive landscape in the CIS industry is becoming more concentrated, with leaders like Sony pushing technological boundaries while competitors like Samsung focus on high-resolution solutions [5] Company Performance - Amazon reported Q3 2025 revenue of USD 180.2 billion, a 13.4% year-on-year increase, with AWS revenue exceeding expectations [6] - Coinbase's Q3 2025 revenue grew by 59% year-on-year to USD 1.79 billion, driven by strong trading performance [6] - Zhongji Xuchuang achieved record quarterly revenue of RMB 10.2 billion, a 57% year-on-year increase, supported by strong demand for 800G optical modules [7]

Core Viewpoint - Jianyin International has slightly lowered the target price for Xiaomi Group-W (01810) by 2.9% from HKD 69 to HKD 67 while maintaining an "Outperform" rating due to adjustments in profit forecasts for IoT and smartphone margins [1] Financial Performance - The forecast for Xiaomi's Q3 2025 revenue is expected to be slightly below institutional expectations, with a year-on-year increase of 22% to RMB 112.7 billion, but a quarter-on-quarter decrease of 3% [1] - Adjusted net profit for Q3 is projected to be RMB 9.7 billion, reflecting a year-on-year increase of 55% but a quarter-on-quarter decrease of 10% [1] - The smartphone gross margin is anticipated to be under pressure, estimated at around 11%, due to rising component prices, particularly for LPDDR4X smartphones [1] IoT and Network Services - Growth in the IoT segment is expected to significantly slow down, primarily due to a high base from the previous year influenced by government subsidies, with a reduction in subsidies this quarter [1] - Despite the impact of price wars being limited, the IoT segment is projected to grow by 25% and 22% in the fiscal years 2025 and 2026, respectively [1] - For network services, growth is anticipated at 9% and 6% for the fiscal years 2025 and 2026, respectively [1] Electric Vehicle (EV) Performance - Xiaomi's EV deliveries for Q3 are expected to reach 108,800 units, representing a quarter-on-quarter increase of 34% [1] - The average selling price of EVs continues to rise, benefiting from the contribution of the YU7 model, with projected EV revenue of RMB 28.7 billion [1]

Core Insights - The penetration rate of AI assistants in smartphones is lower than expected, with users still waiting for a truly powerful and reliable AI assistant [1] - The upcoming flagship phone releases have made AI capabilities a central marketing focus for major manufacturers [1] Group 1: Evolution Trends of AI Assistants - **Deeper Understanding**: AI can recognize more screen information, but this raises privacy concerns, prompting regulatory attention [2] - **Stronger Actionability**: AI is beginning to participate in local life by recognizing restaurants, comparing prices across platforms, and writing reviews [3] - **Higher Interoperability**: There is increased communication and collaboration between different AI assistants [4] Group 2: Key Features and Upgrades - **Screen Content Understanding**: AI assistants are expected to interact more with users' screen content, such as identifying unknown callers and providing alerts for sensitive applications [5] - **Memory Functionality**: New features like "AI one-click flash memory" allow users to summarize and save screen content automatically [6] - **Privacy Measures**: OPPO is addressing privacy concerns by processing sensitive data locally on the device [7] Group 3: AI in Offline Life - **Real-time Interaction**: AI assistants can now use cameras for real-time conversations, enhancing user experience in physical environments [8] - **Price Comparison**: New AI features allow users to compare prices across multiple e-commerce platforms in real-time [8] - **Voice Recognition**: AI assistants are incorporating voice recognition to improve usability in noisy environments [8] Group 4: Challenges and Future Directions - **Complex Task Execution**: Current mobile AI assistants struggle with executing complex multi-step tasks due to a lack of mainstream protocols for communication [12] - **Third-party App Integration**: The reliance on "accessibility features" for AI to control third-party apps raises privacy concerns [12] - **Collaborative AI Models**: The emergence of "smart agents" and A2A protocols may facilitate better task delegation among AI systems [12][13]

Core Viewpoint - Apple is introducing advertising content into its Maps application, signaling a strategic shift for the company, which has traditionally focused on privacy and user experience [1] Group 1: Service Revenue Trends - Apple's hardware sales growth has slowed due to market saturation, with iPhone sales peaking in 2015 and entering a plateau [2] - Since 2016, Apple has aggressively pursued a "service transformation" strategy, resulting in service revenue growing from $24.1 billion in 2016 to $85.1 billion in 2023, a more than 2.5 times increase over seven years, with a compound annual growth rate (CAGR) of approximately 19.3% [2][10] - Service revenue's share of total revenue has increased from 11.2% in 2016 to over 20% in recent years [3] Group 2: Profitability of Services - The profit margins for service businesses are significantly higher than for hardware products, with the App Store's gross margin exceeding 70%, compared to the iPhone's gross margin of about 35%-40% [4] - Although service revenue accounts for around 20% of total revenue, it contributes over 30% of operating profit, making it a core driver of Apple's profitability [4] Group 3: Challenges Facing Service Growth - Apple's service revenue growth is facing challenges, with a projected year-on-year growth rate of only 3.7% for the 2024 fiscal year [5] - Regulatory pressures, particularly regarding the App Store, are increasing, with the EU's Digital Markets Act requiring Apple to open third-party app stores and payment systems, threatening its core service revenue [6] - Competition in the streaming content market is intensifying, with Apple TV+ lagging behind competitors like Netflix and Disney+, and other services like iCloud and AppleCare facing limited market growth [6] Group 4: Advertising in Apple Maps - Apple Maps, with millions of active users, is seen as an underutilized asset with significant commercial potential, especially as it has not previously explored monetization through advertising [7] - The introduction of advertising in Apple Maps is viewed as a necessary step in response to growth pressures and regulatory challenges, marking a shift from a product-centric to a platform-oriented business model [8] - Users express concerns that the introduction of ads may compromise the user experience and the brand's long-standing commitment to privacy [9] Group 5: Future Projections - Despite the current challenges, Apple's service business is projected to exceed $100 billion in revenue for the first time in the 2025 fiscal year, with an expected revenue of $108.6 billion, representing a year-on-year growth of approximately 13% [10] - Apple has surpassed a market capitalization of $4 trillion and is actively seeking new growth avenues [11]

Core Insights - The penetration rate of AI assistants in smartphones is lower than expected, with users still waiting for a truly powerful and reliable AI assistant [1] - The upcoming flagship smartphone releases have made AI capabilities a central marketing focus for major manufacturers, indicating a competitive landscape [1] Group 1: Evolution of AI Assistants - The first evolution focuses on deeper understanding, where AI can recognize more screen information, but this raises privacy concerns [1] - The second evolution emphasizes stronger action capabilities, allowing AI to participate in local life by recognizing restaurants, comparing prices, and writing reviews [1][10] - The third evolution highlights increased interoperability among different AI assistants, enabling them to communicate and collaborate more effectively [1][15] Group 2: Market Performance - In Q3, vivo led the domestic smartphone market with 11.8 million units shipped, capturing 17.3% market share, followed by Apple and Huawei [2] Group 3: Understanding Screen Content - Personalization has become a key focus, with AI expected to interact more with users' screen content, such as providing answers while browsing social media [4] - New features like call identification have been introduced to detect potential scams during incoming calls [4] - AI memory functions have been added to summarize screen content and generate bills, although privacy concerns remain [5][8] Group 4: Participation in Offline Life - AI assistants are now equipped with real-time visual capabilities, allowing them to interact with the physical world through camera input [10] - Features like cross-platform price comparison and automatic review generation are being developed to enhance user experience [10][11] Group 5: Interoperability of Intelligent Agents - The lack of mainstream protocols for mobile AI assistants limits their ability to perform complex tasks across different applications [15] - New collaboration paradigms are emerging, with many apps developing their own AI assistants and emphasizing agent-to-agent communication [15][16]