Core Insights - Mingyuan Cloud (00909.HK) reported a mid-year performance for the first half of 2025, with revenue reaching RMB 605.8 million, a year-on-year decline of 15.9% [1] - The company achieved a profit of RMB 13.748 million, compared to a loss of RMB 115 million in the same period last year, indicating a turnaround to profitability [1] - Adjusted net profit for the period was RMB 33.1 million, a significant improvement from a loss of RMB 10,000 in the previous year [1] Revenue Breakdown - Cloud service revenue amounted to RMB 524.7 million, down 14.3% year-on-year, accounting for 86.6% of total revenue [1] - The decline in cloud service revenue was primarily due to changes in the macro market environment and a decrease in historical contract signings, which affected deferred revenue [1] - Revenue from localized deployment software and services was RMB 81.1 million, reflecting a year-on-year decrease of 24.8% [1] - Despite stable income from existing customers for product support and value-added services, the overall decline in localized deployment revenue was attributed to limited new customer acquisition in the residential market and a drop in new product license sales and contract signings [1]

Core Viewpoint - Mingyuan Cloud (00909) reported a decline in revenue and gross profit for the first half of 2025, but achieved profitability in net income, indicating a potential recovery path despite current challenges [1] Financial Performance - Revenue for the first half of 2025 was approximately 606 million yuan, a year-on-year decrease of 15.9% [1] - Gross profit was about 486 million yuan, also down 15.9% year-on-year [1] - Net profit for the period was 13.748 million yuan, marking a turnaround from a loss [1] - Adjusted net profit reached 33.119 million yuan, indicating a return to profitability [1] Business Segments - Cloud service revenue was approximately 525 million yuan, a year-on-year decline of 14.3%, accounting for 86.6% of total revenue (up from 85.0% in the same period of 2024) [1] - The decline in cloud services was attributed to changes in the macro market environment and a decrease in historical contract signings affecting deferred revenue [1] - Revenue from localized deployment software and services was 81.1 million yuan, down 24.8% year-on-year [1] - Revenue from existing customers for product support and value-added services remained stable, but new customer acquisition in the residential market was limited [1] Growth Outlook - Despite the revenue decline, there has been an improvement in revenue structure, with contributions from AI and overseas products [1] - The Chinese residential market is showing signs of stabilization, and the company plans to focus on AI innovation and expanding into overseas markets to drive sustainable growth and profitability [1]