Summary of Shunwang Technology Conference Call Company Overview - Shunwang Technology holds a leading position in the market, reaching a large number of heavy gamers. The revival of PC gaming and the relaxation of game licensing have improved the gaming industry's outlook, increasing user stickiness for PC and console games, which in turn boosts advertising demand from gaming companies [2][3][4]. Core Business Insights - The primary revenue sources for Shunwang Technology are online advertising and value-added services, mainly targeting internet cafes and esports hotels, which dominate the market share. The company has seen significant revenue growth in 2025, attributed to the overall improvement in the gaming industry and seasonal advertising trends [3][4]. - The advertising business primarily utilizes a Cost Per Thousand Impressions (CPT) model, enhanced by big data for precise ad targeting. The upcoming 9,300 major version update in 2025 is expected to further enhance AI technology applications, improving ad effectiveness and user experience [2][5]. AI and Cloud Computing Initiatives - Shunwang's "Shunwang Intelligent Computing" platform leverages advanced AI capabilities for data analysis and user behavior prediction, enabling precise ad targeting and optimization, thus enhancing marketing efficiency [6]. - The cloud and AI computing services are based on esports technology, utilizing consumer-grade graphics cards for edge computing. The company plans to establish over 300 edge cloud data centers nationwide to meet the demand from internet cafes and esports hotels, ensuring low latency [7][8]. Esports Industry Engagement - The esports industry is viewed as a significant component of competitive sports, with a growing acceptance among the younger generation (Generation Z). Shunwang focuses on grassroots development in esports, aiming to foster a healthy ecosystem that supports the entire industry chain [11][12]. - The company is involved in the development and publishing of mobile games, such as "Three Kingdoms: Hundred Generals Card," which is currently in the testing phase and expected to launch in October [13][15]. Financial Management and Incentives - Shunwang has adjusted its expense recognition method to distribute costs evenly across quarters, promoting healthier financial management. The company is also considering new incentive plans that align with performance targets rather than traditional stock options [16][17]. Future Outlook - The company anticipates continued growth in the second half of 2025, driven by the increasing demand for advertising in the gaming sector and the expansion of its cloud computing services [4][7]. The integration of AI technology is expected to open up new application scenarios and customer growth opportunities [10].

Group 1 - The core point of the announcement is that Beijing Zhangqu Technology Co., Ltd. has decided to absorb and merge its wholly-owned subsidiary, Beijing Juyou Zhanglian Technology Co., Ltd., to optimize resource allocation and improve operational efficiency [1] - The merger will result in the cancellation of Juyou Zhanglian's independent legal status, with all rights and obligations related to its assets and liabilities being assumed by the parent company [1] - The merger does not constitute a related party transaction or a major asset restructuring as defined by relevant regulations [1] Group 2 - Juyou Zhanglian was established on August 26, 2009, with a registered capital of 1 million RMB and is wholly owned by the parent company [1] - As of June 30, 2025, Juyou Zhanglian reported total assets of approximately 146.89 million RMB and a net asset of approximately -527.59 million RMB [1] - The financial performance for the first half of 2025 showed a net loss of approximately 149.93 million RMB, compared to a net loss of approximately 875.38 million RMB for the entire year of 2024 [1] Group 3 - The purpose of the merger is to enhance the overall operational and management efficiency of the company, aligning with its development needs [1] - The financial statements of Juyou Zhanglian have already been included in the consolidated financial statements of the parent company, indicating that the merger will not have a significant impact on the company's financial condition or operating results [1]

Core Viewpoint - The article discusses the delay of GTA 6 and highlights the advancements in AI-driven game engines, particularly focusing on the evolution of the Mirage game engine from version 1 to version 2, which aims to create interactive worlds similar to GTA [1][22]. Group 1: Mirage Game Engine Development - Mirage 1 was the first real-time world model-driven AI native UGC game engine, but it had limitations in scene generation [3][4]. - Mirage 2 has been released just over a month after Mirage 1, showcasing significant improvements in flexibility, intelligence, and performance [5][8]. - The new version allows users to create, experience, and modify any game world instantly, supporting image uploads and real-time dialogue for world modifications [8][17]. Group 2: Performance Enhancements - Mirage 2 has made notable advancements in generation performance, with improvements in object proportions, scene understanding, and overall scene precision [19][21]. - The interaction latency has been reduced to 200 milliseconds, allowing for smoother gameplay on a single consumer-grade GPU [18][20]. - The engine supports various styles of scenes, enhancing user experience and engagement [10][13]. Group 3: Comparison with Competitors - Mirage 2 is positioned to compete with DeepMind's Genie 3, offering more interactive capabilities such as running, jumping, and attacking, with a longer interaction horizon [17][18]. - Despite its advancements, Mirage 2 still faces challenges in visual consistency and character control precision, particularly during rapid scene changes [21][24]. Group 4: Future Prospects - The rapid development of Mirage 2 within a month raises questions about the potential advancements in AI-driven UGC game engines by the time GTA 6 is released in nine months [22].