Summary of Conference Call Notes Company and Industry Involved - The conference call discusses **Century Huatong** and its gaming subsidiary **DianDian** within the **mobile gaming industry**. Core Points and Arguments - **Google Play Revenue Share Reduction**: Google announced a reduction in the revenue share for Google Play from 30% to a range of 15%-25%, which includes a service fee of 15%-20% and a 5% payment processing fee that can be avoided through alternative payment methods. This change will be implemented regionally starting June 2026 in Europe and North America, with a global rollout by September 2027 [1]. - **DianDian's Market Position**: DianDian is positioned as a leader in the **SLG (Simulation Game)** segment globally and plans to focus on the **casual gaming** sector in 2026. In February 2026, two of its games, **Whiteout Survival** and **Find the Book**, ranked 2nd and 3rd respectively in the top 10 Chinese mobile games going overseas, with **Find the Book** rising to 9th place in the casual category [2]. - **Revenue Growth Expectations**: The reduction in Google Play's revenue share is expected to significantly boost DianDian's net revenue, primarily derived from overseas markets. This will support increased investment in user acquisition and enhance profit margins, with projected net profit growth in 2026 and 2027 [2]. - **Shengqu Games Strategy**: Shengqu Games is focusing on core IP operations, leveraging private traffic value. The **Legend IP** licensing is expected to contribute to annual performance, alongside monitoring the performance of the new **Find the Book** IP in collaboration with Tencent [2]. - **Share Buybacks and Financial Health**: The company has demonstrated long-term confidence through multiple share buybacks. Future outlook includes: 1. Game revenue scale is among the top 10 globally, with long lifecycles and improved profit margins in SLG games, and further growth expected in casual categories. 2. Strong cash flow supports exploration of new business opportunities. 3. Ongoing optimization of risk asset management and improvements [2]. Other Important but Possibly Overlooked Content - The strategic focus on casual gaming and the potential for revenue growth in this segment is highlighted as a core objective for 2026, indicating a shift in market strategy [2]. - The implications of the Google Play revenue share reduction on the overall competitive landscape in the mobile gaming industry are significant, potentially benefiting companies with a strong overseas presence [1][2].

Company and Industry Summary Company: Perfect World Key Points - **Game Launch and Testing**: Perfect World has initiated the third round of limited paid testing for "Find the Book," which has exceeded expectations in overall experience. The urban experience is highlighted, with vehicle and cohabitation gameplay being standout features. The PC version performs well, while there is room for optimization on the Android platform [1][2] - **Product Differentiation**: The game shows a solid foundation and significant differentiation in the second game market. There is potential for positive word-of-mouth growth in the upcoming Japanese and North American markets, which could lead to it becoming a long-term major product [1] - **Gameplay Highlights**: 1. The urban scene experience is realistic, with strong interaction depth and rich character interactions. The number of NPCs has increased, adding life-like details. The variety of vehicles includes some that can evolve, such as the motorcycle unlocking "Ghost Fire Motorcycle" [1] 2. A new cohabitation gameplay feature is introduced, which is unlocked at level 4 and includes interactions and exclusive voice lines, enhancing immersion through a first-person perspective [1] 3. Additional casual gameplay options have been added, including PVE search and Mahjong [1] - **Monetization Model**: The game employs a gacha system with a "Monopoly" board-style payment model. Players are guaranteed to receive the current UP character after 90 draws, with a 1.87% base rate for character acquisition. Monthly cards provide resource privileges, and all payments contribute to cumulative recharge [2] - **Performance Across Platforms**: The game runs smoothly on PC and iOS. However, there is variability in performance on Android devices, with mid to high-end models performing well, while devices with Dimensity 8100 and below experience significant frame rate fluctuations. Further optimization is anticipated [2]

Company and Industry Summary Company: 恺英网络 (Kaiying Network) Key Points 1. **Share Buyback Announcement** The company announced a share buyback plan of up to 200 million RMB and no less than 100 million RMB, which will be used for future equity incentive plans or employee stock ownership plans [1] 2. **Growth of Legendary Box** The growth of the Legendary Box is highly certain, with an estimated Daily Active Users (DAU) of approximately 500,000 by the end of 2025. The introduction of brand-specific games and the expansion of new emotional IPs like 热江 (Hot River) and 红月 (Red Moon) are expected to drive a DAU growth rate of over 30% in 2026. The future Compound Annual Growth Rate (CAGR) for the box is projected to be around 30% over the next three years, with a high platform profit margin leading to significant profit growth [1][2] 3. **Strong Partnerships** The company has strong partnerships with 玩心不止 (Wangxin No More), which has demonstrated a strong ability to explore new categories on top of existing legendary games. The game "查找图书" (Find the Book) is becoming a benchmark case for the integration of legendary games with new elements. This partnership is expected to further empower the company's game distribution capabilities [2] 4. **AI Companion Product Launch** The company is set to launch its first native AI companion product, "查找图书," on March 14. This product is unique in the market and has already undergone two rounds of iOS testing, with impressive user engagement metrics. The product is expected to evolve into a dual interface for emotional companionship and life management services, indicating significant potential [2] 5. **Profit Forecasts** According to Wind's consensus, the company's profits are projected to be 2.04 billion, 2.65 billion, and 2.94 billion RMB for the years 2025, 2026, and 2027, respectively, representing year-on-year growth of 26%, 30%, and 11%. The corresponding Price-to-Earnings (PE) ratios are 24.4x, 18.8x, and 16.9x. Given the company's platform attributes and AI positioning, there is room for upward adjustments in valuation and Earnings Per Share (EPS), leading to a positive recommendation [2]