Core Insights - The company Shenzhou Taiyue (300002) has confirmed that its two main games, "Age of Origins" and "War and Order," along with two new games, "Stellar Sanctuary" and "Next Agers," have obtained domestic game licenses [1] - The two new games, "Stellar Sanctuary" and "Next Agers," are currently in the commercialization testing phase and have not yet entered the formal promotion and launch stage [1]

Core Viewpoint - The company is currently in the commercialization testing phase for its new games "Stellar Sanctuary" and "Next Agers," and has not yet entered the formal promotion stage [2] Group 1: Project Information - The company has not disclosed specific details regarding the projects it will win bids for in 2025, including the amounts, as it will comply with legal disclosure obligations when the information meets the disclosure standards [2] Group 2: Game Development and Promotion - The two new games, "Stellar Sanctuary" and "Next Agers," are still undergoing commercialization testing and have not yet been officially launched or promoted [2]

Group 1 - The core point of the article is that Shenzhou Taiyue (300002.SZ) has received domestic game licenses for its two main games, "Age of Origins" and "War and Order," as well as for two new games, "Stellar Sanctuary" and "Next Agers," which are currently in the commercialization testing phase and have not yet entered the formal promotion stage [1] Group 2 - The gaming ETF (product code: 159869) tracks the China Securities Animation and Gaming Index and has seen a recent decline of 0.78% over the past five days, with a price-to-earnings ratio of 35.70 times and a net subscription of 190 million yuan [4] - The food and beverage ETF (product code: 515170) tracks the China Securities Subdivision Food and Beverage Industry Theme Index, experiencing a decline of 1.01% over the past five days, with a price-to-earnings ratio of 21.07 times and a net redemption of 47.515 million yuan [3] - The Sci-Tech Innovation 50 ETF (product code: 588000) tracks the Shanghai Stock Exchange Sci-Tech Innovation Board 50 Index, showing a decline of 2.48% over the past five days, with a price-to-earnings ratio of 150.85 times and a net redemption of 290 million yuan [5] - The cloud computing 50 ETF (product code: 516630) tracks the China Securities Cloud Computing and Big Data Theme Index, with a slight increase of 0.19% over the past five days, a price-to-earnings ratio of 91.61 times, and a net redemption of 12.313 million yuan [5]

Investment Rating - The report maintains a "Buy" rating for the company [4] Core Insights - The company's Q3 2025 performance met expectations, with a slight decline in revenue and net profit, while the overseas market remains stable, and there is optimism for the new game cycle [1][2] - The decline in net profit is primarily due to a significant recovery of a large lawsuit receivable in the same period last year, which reduced bad debt provisions by 245 million [2] - The company is focusing on building a "2+2+N" product matrix, emphasizing the SLG genre, with two new games currently in overseas commercialization testing [3] Financial Overview - Q3 2025 revenue was 1.38 billion (down 5.3% YoY), with a net profit of 215 million (down 53.6% YoY) and a non-GAAP net profit of 208 million (down 3.2% YoY) [2] - The gross margin for Q3 2025 was 56.17% (down 5.02 percentage points YoY), with sales expenses of 178 million and a research and development expense of 84 million [2] - Revenue projections for 2025-2027 are 6.93 billion, 8.94 billion, and 9.93 billion respectively, with net profits of 1.29 billion, 1.96 billion, and 2.15 billion [4][6] Product Development - The company has released two new games, "Stellar Sanctuary" and "Next Agers," which are currently in testing phases and have received domestic licenses for release [3] - The AI product line, avavox, is being promoted as a key new product, integrating various AI technologies to enhance its commercial application [3]

Core Viewpoint - Shenzhou Taiyue is a leading comprehensive information technology service provider in China, with strong technical capabilities in artificial intelligence and gaming, and has shown solid financial performance in the industry [1][2]. Group 1: Business Overview - Shenzhou Taiyue was established on May 18, 2001, and listed on the Shenzhen Stock Exchange on October 30, 2009, with its headquarters in Beijing [1]. - The company's main business segments include operator services, IoT and communications, artificial intelligence and big data, mobile gaming, and innovative businesses [1]. Group 2: Financial Performance - For Q3 2025, Shenzhou Taiyue reported revenue of 4.068 billion yuan, ranking 7th among 26 companies in the industry, with the industry leader, ST Huatuo, generating 27.223 billion yuan [2]. - The net profit for the same period was 711 million yuan, placing the company 6th in the industry, with ST Huatuo leading at 4.442 billion yuan [2]. - The company's asset-liability ratio was 11.09%, lower than the previous year's 12.55% and significantly below the industry average of 29.04%, indicating strong solvency [3]. - The gross profit margin for Q3 2025 was 58.58%, slightly down from 61.95% year-on-year but still above the industry average of 58.35% [3]. Group 3: Shareholder Information - As of September 30, 2025, the number of A-share shareholders decreased by 5.14% to 84,100, while the average number of circulating A-shares held per shareholder increased by 5.26% to 21,900 [5]. - The top circulating shareholder is the Huaxia CSI Animation Game ETF, holding 56.4599 million shares, an increase of 9.6514 million shares from the previous period [5]. Group 4: Executive Compensation - Chairman David Mao's compensation increased from 8.6126 million yuan in 2023 to 9.7151 million yuan in 2024, reflecting a rise of 1.1025 million yuan [4]. Group 5: Market Outlook - Analysts from Galaxy Securities expect the company's net profit to reach 1.059 billion yuan in 2025, with projections of 1.382 billion yuan in 2026 and 1.563 billion yuan in 2027, maintaining a "recommended" rating [6]. - Haitong Securities noted that the company's revenue and net profit have shown signs of narrowing decline, with stable performance from existing games and the launch of new titles [6].

Core Viewpoint - The company has shown a narrowing decline in revenue and net profit in Q3 2025, with strong performance from evergreen games like "Age of Origins" and "War and Order," and promising expectations for new games [1][2][3] Financial Performance - In Q3 2025, the company achieved revenue of 1.384 billion yuan, a year-on-year decrease of 5.29% - The net profit attributable to shareholders was 215 million yuan, down 53.55% year-on-year - The non-GAAP net profit attributable to shareholders was 208 million yuan, a decline of 3.20% year-on-year, indicating a smaller drop compared to revenue [2] - For the first three quarters of 2025, the cumulative revenue was 4.068 billion yuan, down 9.86% year-on-year, with a net profit of 724 million yuan, down 33.77% year-on-year [2] Game Performance - Evergreen games "Age of Origins" and "War and Order" have maintained stable performance, with "Age of Origins" undergoing frequent updates and events to enhance player engagement [3] - "War and Order" has also seen multiple updates to improve user experience, showcasing the company's long-term operational capabilities [3] - The new game "Stellar Sanctuary" has been launched, combining simulation management and SLG gameplay, with expectations for strong future performance [3] Future Outlook - The company anticipates steady revenue from its evergreen games and is optimistic about the performance of new releases [2][3] - EPS estimates for 2025-2027 are projected at 0.61, 0.84, and 1.01 yuan respectively, with a target price of 16.47 yuan based on a 27x dynamic PE for 2025 [2]

Financial Performance - In the first three quarters of 2025, the company achieved a revenue of 4.068 billion CNY and a net profit attributable to shareholders of 0.724 billion CNY [3] - In Q3 2025, the net profit attributable to shareholders was 0.215 billion CNY, with a non-attributable net profit of 0.208 billion CNY [3] Main Products - The two main products, "Age of Origins" and "War and Order," have maintained strong player engagement, continuing a stable revenue trend after over 6 and 8 years since their launch, respectively [3] - New games "Stellar Sanctuary" and "Next Agers" are currently in the commercialization testing phase and have received domestic game licenses [3] Computer Business Line - The computer business line remains stable, with new businesses in cloud and AI showing promising performance [3] - The AI product "avavox" was officially launched at the 2025 China Mobile Global Partner Conference, integrating general large models and proprietary small models to enhance commercial application efficiency [4]

Core Viewpoint - The company has successfully launched two new games aimed at the overseas market, which are currently in the final stages of commercialization testing and are expected to enter formal promotion soon [1] Group 1: Game Development and Launch - The company has released two new games, "Stellar Sanctuary" and "Next Agers," which are designed for the overseas market and are currently undergoing commercialization testing [1] - Both games have been listed on the Google Play and App Store in the US, indicating progress towards their official launch [1] - The company has also obtained domestic licenses for these games and is developing mini-program versions specifically for the domestic market, with plans to launch them at an appropriate time [1]

Investment Rating - The report maintains an "Overweight" rating for the industry [1]. Core Insights - The performance of A-share game companies in H1 2025 is strong, driven by two innovative game categories: "Micro Horror Search and Fight" and "Overseas SLG" [2]. - "Micro Horror Search and Fight" is expected to become a long-lasting game with a high profit margin, enhancing the performance of companies like Giant Network [2]. - The overseas SLG market is entering a new expansion cycle, with leading companies showing significant advantages [2]. Summary by Sections 1. Micro Horror Search and Fight: Long-lasting Games with High DAU - The "Search and Fight" category creates a loop of investment, risk, and return, making players addicted through high failure penalties and strong victory rewards [10]. - The game "Supernatural Action Group" targets the casual social and female-oriented segment, with no current competitors in the market, indicating potential for sustained growth [2][20]. - The female gaming market is projected to reach 8 billion yuan in 2024, growing by 124.1% year-on-year, highlighting the increasing importance of female players [11]. 2. Overseas SLG: New Expansion Cycle in the Industry - The overseas SLG mobile game market is expected to reach $124.64 billion in 2024 and $73.08 billion in H1 2025, with year-on-year growth of 17% and 25% respectively [43]. - Chinese companies are projected to generate $185.57 billion in overseas revenue in 2024, with strategy games accounting for 41.38% of the top 100 games [43]. - SLG games have high user value, with the average revenue per download (RPD) for 4X SLG being 8-9 times higher than the overall mobile game level [44]. 3. Major Companies - Giant Network is expected to benefit significantly from "Supernatural Action Group," which could lead to a "Davis Double" effect, enhancing both revenue and valuation [71].

Group 1 - The company is focusing on the domestic market development and has obtained domestic licenses for new products "Stellar Sanctuary" and "Next Agers," which are nearing the end of commercial testing [2] - The company has developed mini-program versions specifically for the domestic market, which is expected to enhance market share upon launch [2] - The Indian market leads globally in download volume but has a low payment rate; if payment capabilities improve in the future, it will become a key area of focus for the company [2]