Core Viewpoint - The company emphasizes the urgent need for composite talents skilled in AI technology to drive innovation and growth in the gaming industry, as demonstrated by its recruitment efforts at top universities [1][4][13]. Group 1: Recruitment and Talent Development - The company is actively recruiting at prestigious universities like Tsinghua University, Peking University, and Zhejiang University, showcasing its commitment to integrating AI technology with talent cultivation [1][11]. - The recruitment strategy focuses on high-level talents who possess both technical skills and innovative thinking, particularly those with a background or interest in AI [13]. - The company offers competitive salaries, with technical positions reaching up to 650,000 yuan and non-technical positions up to 400,000 yuan, along with various benefits to support new hires [15]. Group 2: AI Integration and Industry Strategy - The company has invested heavily in AI capabilities, acquiring over a thousand high-performance GPUs and achieving a total computing power of 312 PFLOPS, with nearly 100 million yuan invested since 2022 [4]. - The development of the proprietary industry model "Xiao Qi" has led to the creation of nearly 400 intelligent agents, significantly enhancing operational efficiency [4]. - AI applications have improved productivity, with AI-generated 2D drawings exceeding 2 million per month and AI video production reaching over 40,000 clips annually [4]. Group 3: Global Expansion and Cultural Promotion - The company has been executing a global strategy since 2012, establishing the 37GAMES brand and expanding its gaming business to over 200 countries, positioning itself among the top Chinese gaming companies in international markets [8][10]. - The company utilizes games as a medium to promote Chinese culture, integrating traditional elements into its products to bridge cultural gaps [8][10]. - AI is also employed in localization and operational processes, achieving a 95% accuracy rate in AI translation for overseas markets [8]. Group 4: Future Directions and Industry Trends - The company aims to focus on "premium, diversified, and global" product development, expanding into various game genres to meet diverse user needs [10]. - The company believes that the future of the gaming industry lies in composite talents who can leverage AI and innovation to drive growth [13]. - The company is committed to fostering a dynamic relationship between academia and industry through initiatives like the Global University Game Innovation Competition, which includes a funding pool exceeding 1 million yuan [13].

Core Insights - The gaming sector is experiencing steady growth, with a notable acceleration in the PC gaming market. [1] - The gaming ETF (159869) has shown a slight increase, reflecting positive market sentiment. [1] Market Performance - On September 16, the gaming sector opened lower but rebounded, with the gaming ETF (159869) turning positive. [1] - Key stocks such as Xinghui Entertainment reached the daily limit, marking a two-day consecutive rise, while other stocks like Fuchun Co., Tianzhou Culture, and Kaiying Network also saw gains. [1] Market Size and Growth - According to Gamma Data, by July 2025, the domestic gaming market's actual sales revenue is projected to reach 29.084 billion yuan, representing a year-on-year growth of 8.14% and a quarter-on-quarter increase of 4.62%. [1] - The PC gaming market has shown significant growth, with sales in June and July reaching 5.866 billion yuan and 6.637 billion yuan, respectively, reflecting year-on-year growth rates of 0.81% and 13.14%. [1] - Self-developed games in the overseas market generated actual sales revenue of 1.693 billion USD, marking a year-on-year increase of 8.18%. [1] Product Highlights - The game "Delta Action" has topped the charts, with new entries in the top 10 including "Douluo Dalu: Hunting Soul World" and "Paper Marriage 8: Qianzi Tree." [1] Industry Outlook - Guojin Securities indicates that gaming demand remains strong, with key game revenues continuing to rise. The industry is expected to maintain a high level of prosperity, supported by ample game reserves. [1] - The gaming sector is poised for multiple catalysts, including advancements in AI, content, and commercialization models. [1] - The gaming ETF (159869) tracks the Zhongzheng Animation and Gaming Index, reflecting the overall performance of A-share listed companies in the animation and gaming industry, presenting investment opportunities. [1]

Group 1: Service Trade Growth - Guangzhou's service trade import and export total continued to show double-digit growth in the first half of the year [2] - The city organized 28 enterprises to participate in the 2025 China International Service Trade Fair, showcasing its achievements in the service trade sector [2] Group 2: Innovation in Technology - Guangzhou enterprises displayed innovative products such as EH216-S unmanned aerial vehicle and MAXHUBX7 industrial robot, highlighting advancements in low-altitude economy and intelligent equipment [3] - Titanium Technology showcased its MarTech+AI technology products, improving marketing efficiency by over 10 times for over 80,000 Chinese enterprises going global [3][4] - The company plans to launch its global marketing AIAgent, Navos, in late October in Guangzhou [3] Group 3: Cultural Export and IP Development - Companies like 37 Interactive Entertainment and Yongsheng Animation showcased their digital entertainment innovations, with 37 Interactive having launched over 120 games globally [5] - Yongsheng Animation introduced an AI early education robot that integrates advanced 3D technology, expanding the application of cultural IP [5] - Miniso's "DUN Chicken" and "PenPen" plush toys utilized innovative materials to enhance cultural IP appeal in global markets [6] Group 4: Global Engagement and Future Prospects - Guangzhou is reshaping its competitive advantage in service trade through high-level openness and aims to connect global resources [7] - The city anticipates more enterprises to shine on the world stage and contribute to global service trade development [7]

Core Insights - The 2025 China International Service Trade Fair opened in Beijing, with Anhui Province participating as a guest province, showcasing its service trade growth and cultural trade initiatives [1][2] Service Trade Growth - Anhui Province's service trade total increased from 33.37 billion yuan in 2020 to 49.27 billion yuan in 2024, achieving an average annual growth rate of 10.2% [2] - In the first half of 2025, Anhui's service trade reached 30.64 billion yuan, marking a 34.4% increase, ranking third nationally and exceeding the national average growth rate by 26.4 percentage points [2] Structural Optimization - The structure of Anhui's service trade is improving, with digital delivery trade, including insurance, finance, and information services, accounting for 40.4% of the total service trade in the first half of 2025, growing by 32.8% year-on-year [2] - Anhui has developed a high-level open system centered around Hefei, enhancing its service trade capabilities and promoting service outsourcing [2][3] Cultural Trade Development - Anhui is leveraging "Hui culture" to enhance its cultural trade, with 33 enterprises and 3 projects recognized as key cultural export enterprises, ranking third nationally [4][5] - The province's cultural and tourism sector is thriving, with over 700 million annual visitors, contributing significantly to service trade and consumption upgrades [5] Business Environment Optimization - Anhui has implemented 35 measures to optimize its business environment, including a "one-stop" service reform that reduces the number of required visits by 94% [7] - The province has allocated 18.79 billion yuan directly to 41,000 enterprises, enhancing financial support for businesses [7] Foreign Investment and Cooperation - Anhui has successfully attracted major projects, including NIO headquarters and IKEA, and has established 33 overseas business service points to facilitate international cooperation [8][9] - From January to July 2025, Anhui's actual foreign investment reached 2.1 billion USD, growing by 19.2%, ranking eighth nationally [8]

Core Insights - The 2025 China International Service Trade Fair opened in Beijing, with Anhui Province participating as the guest province, showcasing its service trade growth and cultural trade initiatives [1][4]. Group 1: Service Trade Growth - Anhui Province's service trade total increased from 33.37 billion yuan in 2020 to 49.27 billion yuan in 2024, achieving an average annual growth rate of 10.2% [2]. - In the first half of 2025, Anhui's service trade reached 30.64 billion yuan, marking a 34.4% increase, ranking third nationally and exceeding the national average growth rate by 26.4 percentage points [2]. Group 2: Structural Optimization - The structure of Anhui's service trade is improving, with digital delivery trade, including insurance, finance, and information services, accounting for 40.4% of the total service trade in the first half of 2025, growing by 32.8% year-on-year [2]. - Anhui has developed a high-level open system centered around Hefei, enhancing its service trade capabilities and promoting service outsourcing [2][3]. Group 3: Cultural Trade Initiatives - Anhui is leveraging "Hui culture" to enhance its cultural trade, with 33 enterprises and 3 projects recognized as key cultural export enterprises, ranking third nationally [4]. - The province's cultural trade is accelerating, with companies like 37 Interactive Entertainment showcasing games that promote Chinese culture at the trade fair [4]. Group 4: Economic and Investment Environment - Hefei ranks 15th among China's top foreign trade cities, with significant international cooperation and a focus on cross-border trade facilitation [3]. - Anhui's actual foreign investment reached 2.1 billion USD in the first seven months of the year, growing by 19.2%, ranking 8th nationally [8]. Group 5: Business Environment Optimization - Anhui has implemented 35 measures to enhance its business environment, including a "one-stop" service model that reduces administrative burdens for enterprises [7][9]. - The province's government ranks 7th in national transparency and 3rd in optimizing the business environment, reflecting its commitment to improving conditions for private enterprises [9].

Core Viewpoint - The 2025 China International Service Trade Fair highlights the significant growth and structural optimization of Anhui Province's service trade, showcasing its cultural trade as a key soft power asset. Group 1: Service Trade Growth - Anhui Province's service trade total increased from 33.37 billion yuan in 2020 to 49.27 billion yuan in 2024, with an average annual growth rate of 10.2% [4] - In the first half of 2025, Anhui's service trade reached 30.64 billion yuan, marking a 34.4% growth, ranking third nationally and exceeding the national average growth rate by 26.4 percentage points [4] - Digital delivery trade, including insurance, finance, and cultural services, accounted for 40.4% of the total service trade in the first half of 2025, with an import-export value of 12.37 billion yuan, growing by 32.8% year-on-year [4] Group 2: Economic and Cultural Integration - Hefei City, as a core engine, has deepened international cooperation with over 220 countries and regions, ranking 15th among China's top foreign trade cities [5] - The city has seen a significant economic growth, with a total economic output exceeding 1.35 trillion yuan in 2024, making it one of the fastest-growing cities in China over the past 20 years [5] - Anhui's cultural trade is accelerating, with 33 enterprises and 3 projects recognized as key national cultural export enterprises, ranking third nationally [6] Group 3: Business Environment Optimization - Anhui Province has implemented 35 measures to enhance service trade quality and efficiency, including a "one-stop" service reform that reduced the number of required visits by 94% [8] - The province has allocated 18.79 billion yuan directly to 41,000 enterprises to support business operations [8] - The establishment of 33 overseas business service points and the successful attraction of major projects like NIO and IKEA demonstrate Anhui's commitment to expanding its international trade footprint [9]

Investment Rating - The report maintains a "Buy" rating for the company with a target price of 27.50 CNY [5][3]. Core Views - The company is expected to optimize its self-developed project diversification in 2026, leading to an increase in the proportion of self-developed games and an improvement in gross margin. The forecasted net profit for the company from 2025 to 2027 is 2.763 billion, 3.226 billion, and 3.656 billion CNY respectively, with adjustments made based on game launch progress and marketing data [3][9]. Financial Performance Summary - The company's revenue for H1 2025 was 8.49 billion CNY, a year-on-year decrease of 8%, primarily due to the decline of older games like "Seeking the Great Thousand." The gross margin for H1 2025 was 76.7%, down 2.9 percentage points, mainly due to an increase in the proportion of agency games. The net profit attributable to the parent company was 1.4 billion CNY, an increase of 11% year-on-year, mainly due to reduced sales expenses [9]. - Domestic revenue for H1 2025 was 5.76 billion CNY, a year-on-year decrease of 9%, while overseas revenue was 2.72 billion CNY, a year-on-year decrease of 6%. The company has several global products awaiting launch, with a diverse portfolio across various genres [9]. - The company has significantly integrated AI technology into its operations, with over 80% of 2D art assets and over 30% of 3D assets generated using AI. AI has also been involved in generating over 70% of game advertising materials and has achieved a 95% accuracy rate in localizing translations for 85% of its overseas games [9]. Financial Forecasts - The projected revenue for the company from 2023 to 2027 is as follows: 16.547 billion, 17.441 billion, 17.087 billion, 18.097 billion, and 18.646 billion CNY, with corresponding growth rates of 0.9%, 5.4%, -2.0%, 5.9%, and 3.0% [4][11]. - The forecasted net profit for the same period is expected to grow from 2.659 billion CNY in 2023 to 3.656 billion CNY in 2027, with growth rates of -10.0%, 0.5%, 3.4%, 16.8%, and 13.3% respectively [4][11].

Core Viewpoint - Company reported a decline in revenue for the first half of 2025, but a significant increase in net profit, indicating improved profitability despite revenue challenges [1][2] Financial Performance - For the first half of 2025, the company achieved revenue of 8.486 billion yuan, a year-on-year decrease of 8.08%, while net profit attributable to shareholders was 1.4 billion yuan, an increase of 10.72% [1] - In Q2 2025, the company reported revenue of 4.243 billion yuan, down 5.33% year-on-year, but net profit increased by 31.24% to 851 million yuan [1][2] - The company announced a cash dividend of 2.10 yuan per share, totaling 926 million yuan for the first half of 2025, representing 66% of net profit [1] Cost Management and Profitability - The significant improvement in Q2 2025 net profit was attributed to a reduction in sales expenses, which decreased by 19.3% to 1.99 billion yuan [1] - The sales expense ratio fell by 8.1 percentage points to 46.9%, primarily due to the transition of key games into maturity, leading to reduced marketing spend [1] - AI-driven advertising has enhanced the efficiency of user acquisition, with AI advertising accounting for 50% of total ad spend, improving efficiency by 70% [1] Product Performance and Future Outlook - The decline in Q2 revenue was influenced by the introduction of new games, which are still in the launch phase, compared to stable revenue from mature games in the previous year [2] - The company is set to launch its self-developed game "Douluo Dalu: Hunting World," which has already topped the iOS free chart, expected to contribute to revenue in Q3 [2] - The company has a rich product pipeline, with a focus on the release schedule of new games, including various genres such as SLG and MMORPG [2] Investment Outlook - Projections for 2025-2027 indicate revenues of 18.838 billion, 20.322 billion, and 21.546 billion yuan, with net profits of 2.931 billion, 3.334 billion, and 3.819 billion yuan respectively [2] - The company is expected to maintain a "buy" rating due to its recovering user acquisition costs and promising new game performance [2]

Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected stock price increase of over 15% relative to the industry index in the next six months [4][16]. Core Views - The company is experiencing a recovery in profits due to reduced sales expenses and improved advertising efficiency through AI, with a notable 31.24% year-on-year increase in net profit for Q2 2025 [2][3]. - The company has a rich product pipeline, with several new games expected to contribute to revenue growth, particularly the self-developed game "Douluo Dalu: Hunting Soul World" which has already topped the iOS free chart [3][2]. - The financial outlook for the company is positive, with projected revenues and net profits increasing steadily from 2025 to 2027, alongside a decreasing P/E ratio, indicating potential for value appreciation [3][4]. Financial Summary - For 2023, the company reported revenue of 16,547 million yuan, with a slight growth rate of 0.9% year-on-year. The net profit attributable to the parent company was 2,659 million yuan, reflecting a decline of 10.0% year-on-year [1]. - The forecast for 2025 estimates revenue to reach 18,838 million yuan, with a growth rate of 8.0%, and net profit expected to be 2,931 million yuan, marking a 9.7% increase [1][3]. - The company's return on equity (ROE) is projected to remain strong, around 19.3% in 2025, while the earnings per share (EPS) is expected to grow from 1.20 yuan in 2023 to 1.33 yuan in 2025 [1][3]. Product and Market Position - The company has a diverse product portfolio, including self-developed and licensed games, with a significant focus on SLG and MMORPG genres. The upcoming releases are anticipated to enhance revenue streams [3][2]. - The company has successfully reduced its sales expenses by 19.3% in Q2 2025, contributing to improved profit margins and overall financial health [2][3].

Investment Rating - The report maintains a "Buy" rating for the company [1] Core Views - The company's performance exceeded expectations, with stable profits from existing games and a strong pipeline of new games [7] - The company has released a new game based on the "Douluo" IP, which has performed well since its launch [7] - The integration of AI technology in game development and marketing is expected to enhance operational efficiency and innovation [7] Financial Performance Summary - For the first half of 2025, the company achieved total revenue of 8.486 billion yuan, a year-on-year decrease of 8.08%, while net profit attributable to shareholders was 1.4 billion yuan, an increase of 10.72% year-on-year [7] - The second quarter of 2025 saw revenue of 4.243 billion yuan, down 5.33% year-on-year, but net profit increased by 31.24% year-on-year [7] - The company maintained a high dividend payout ratio of 66.17%, with a total dividend of 0.927 billion yuan for the first half of 2025, resulting in a dividend yield of 2.43% [7] Earnings Forecast and Valuation - The earnings per share (EPS) for 2025-2027 are projected to be 1.29 yuan, 1.39 yuan, and 1.44 yuan respectively, with corresponding price-to-earnings (P/E) ratios of 15, 14, and 14 times based on the current stock price [7][8] - The report highlights the company's strong cash flow and asset management, with a projected return on equity (ROE) of around 20% [8]