Investment Rating - The report assigns a "Buy-A" rating to the company, with a 6-month target price of 44.5 yuan [4]. Core Insights - The company demonstrated strong revenue growth in Q3 2025, achieving 1.706 billion yuan, a year-on-year increase of 115.63%, and a net profit of 640 million yuan, up 81.19% year-on-year [1]. - The game "Supernatural Action Group" has shown rapid user growth and revenue increase, contributing significantly to the company's performance [1][2]. - The company has a strong ability to release deferred revenue, with contract liabilities reaching 1.333 billion yuan in Q3 2025, indicating robust commercialization potential [2]. - The company maintains a focus on self-developed and high-quality games, with successful IPs like "Journey" and "Ball Battle," which form a stable performance base [2]. Summary by Sections Financial Performance - In the first three quarters of 2025, the company reported total revenue of 3.368 billion yuan, a 51.84% increase year-on-year, and a net profit of 1.416 billion yuan, up 32.31% year-on-year [1]. - The gross margin for Q3 2025 was 90.46%, slightly up by 0.64 percentage points year-on-year [1]. - The sales expense ratio increased to 36.65%, up 1.41 percentage points year-on-year, reflecting higher advertising and channel costs [1]. Future Projections - The company expects revenues of 5.14 billion yuan, 7.36 billion yuan, and 8.085 billion yuan for 2025, 2026, and 2027 respectively, with net profits projected at 2.252 billion yuan, 3.367 billion yuan, and 3.691 billion yuan for the same years [3][8]. - The report anticipates that the deferred revenue will continue to be released, supporting future earnings growth [2]. Valuation Metrics - The report suggests a price-to-earnings (PE) ratio of 25 times for 2026, leading to a target price of 44.5 yuan [3]. - The expected earnings per share (EPS) for 2025, 2026, and 2027 are projected to be 1.19 yuan, 1.78 yuan, and 1.95 yuan respectively [3][8].

Core Insights - Giant Network reported a revenue of 3.368 billion yuan for the first three quarters of 2025, representing a year-on-year growth of 51.84% [1] - The net profit for the same period was 1.417 billion yuan, showing a year-on-year increase of 32.31% [1] - The sudden resignation of CEO Zhang Dong was announced, with Liu Wei taking over the role, focusing on nurturing young core talent [1] Company Developments - Zhang Dong resigned due to personal reasons, and the company stated that his departure would not affect normal operations [1] - Liu Wei, who previously stepped down as CEO two years ago, has returned to lead the company [1] Strategic Direction - The company is developing along the "gaming + artificial intelligence" path as envisioned by its actual controller, Shi Yuzhu [1] - Shi Yuzhu emphasized the importance of player experience over revenue, stating that the growth in player numbers is more significant than revenue growth [1][2] - The focus for future game development will be on making games enjoyable, engaging, and sustainable for players [2]

Core Insights - The chairman of Giant Network, Shi Yuzhu, expressed satisfaction with the growth in player numbers for the "Journey" IP, which has outpaced revenue growth over the past two years, indicating the team is on the right track [2] - Shi emphasized the importance of focusing on player experience rather than just revenue, highlighting three key aspects for future development: being engaging, enjoyable, and sustainable [2] - The company aims to enhance its appeal to younger players by adjusting art styles, simplifying gameplay, and improving communication regarding game rules and features [2] Company Strategy - Shi Yuzhu rated the team's performance at 80 out of 100, indicating a strong foundation but recognizing the need for further improvement in game enjoyment [2] - The company plans to prioritize the development of games that not only last for 20 years but also thrive, with expectations for significant improvements in gameplay and player growth in the coming years [2] - Future game versions and products will involve direct player feedback, with Shi committing to engage with the games personally to understand player opinions [2]

Core Insights - The chairman of Giant Network, Shi Yuzhu, emphasized that the growth in player numbers for the "Zhengtu" IP has significantly outpaced revenue growth over the past two years, which he considers a major achievement for the team [1] - Shi Yuzhu expressed a focus on enhancing player experience rather than solely prioritizing revenue, highlighting the importance of attracting younger players and ensuring the game is enjoyable and engaging [1] Summary by Categories Company Performance - The player growth for the "Zhengtu" game has exceeded revenue growth, indicating strong team performance in expanding the user base [1] - Shi Yuzhu rated the team's overall performance at 80 out of 100, reflecting satisfaction with their efforts while also indicating room for improvement [1] Strategic Focus - The company aims to prioritize player experience, focusing on three key aspects: being playable, enjoyable, and sustainable [1] - Shi Yuzhu's return to the development front in late 2022 has reinforced the emphasis on these strategic priorities [1]

Core Insights - The chairman of Giant Network, Shi Yuzhu, expressed satisfaction with the growth in player numbers for the "Journey" IP, which has outpaced revenue growth over the past two years [2] - Shi emphasized the importance of focusing on player experience rather than just revenue, highlighting the need for games to be engaging, fun, and durable [2] - He rated the team's performance at 80 out of 100, indicating that while there has been significant progress, there is still room for improvement [2] Company Performance - The growth in player numbers for the "Journey" IP has significantly exceeded revenue growth, which Shi considers a positive indicator of the team's efforts [2] - Shi believes that the game must prioritize player experience, stating that the focus should be on making the game enjoyable and sustainable [2] - The company has experienced a resurgence in recent years, and Shi is optimistic about the future, expecting substantial improvements in gameplay and player growth [2] Future Outlook - Shi Yuzhu expressed a commitment to enhancing the game's quality over the next twenty years, aiming for both longevity and excellence [2] - He plans to engage with new versions and products personally to gather player feedback and ensure a better gaming experience [2] - The chairman is confident that the collaborative effort between developers and players will lead to significant advancements in the game's appeal [2]

Core Insights - The chairman of Giant Network, Shi Yuzhu, emphasized that the growth in the number of players for the "Journey" IP has significantly outpaced revenue growth over the past two years, which he views positively as it indicates the team is on the right track [1] - Shi Yuzhu rated the team's performance at 80 out of 100, suggesting there is still considerable room for improvement despite acknowledging their achievements [1] - The chairman believes that a game should prioritize player experience and the number of users over revenue, reflecting a shift in focus since his return to the R&D front line at the end of 2022 [1]

Core Insights - The chairman of Giant Network, Shi Yuzhu, expressed satisfaction with the growth in player numbers for the "Journey" IP, which has outpaced revenue growth over the past two years, indicating the team is on the right track [1][3] - Shi rated the team's performance at 80 out of 100, emphasizing the need to focus on younger players and improve the gaming experience by making it simple, enjoyable, and engaging [1][4] Player Growth and Revenue - The growth in player numbers has significantly exceeded revenue growth, which Shi views as a positive sign of the team's performance [3][4] - The focus should shift from revenue to player experience, as a game should prioritize player engagement over income [3][4] Key Improvement Areas - The company needs to simplify gameplay to attract younger players, who may find complex features off-putting [4][5] - Enhancements in core gameplay mechanics are necessary, with room for significant improvement despite progress made in the last two years [4] - To maintain player interest, the game must offer varied experiences daily, enhancing interaction and randomness in gameplay [4][5] Focus on Younger Players - Shi highlighted the importance of understanding the preferences of younger players, suggesting three optimization strategies: 1. Balancing art style to appeal to both young and old players [4] 2. Simplifying gameplay to accommodate fast-paced lifestyles [4] 3. Communicating with players to adapt rules and features to their interests [4][5] Future Outlook - Shi is optimistic about the future of the "Journey" IP, believing that player numbers will continue to grow significantly [5] - The company aims to enhance game quality over the next few years, with a commitment to actively engage with players for feedback on new versions and products [5]

Core Insights - Chengdu is emerging as a new hub for China's cultural and creative industries, characterized by a unique blend of traditional and modern elements, creating a vibrant cultural landscape [1][15] Group 1: Industry Growth and Development - Chengdu's cultural and creative industry has seen rapid growth, with the industry's added value reaching 287.6 billion yuan in 2024, marking an 11.69% year-on-year increase [4] - The number of digital cultural enterprises in Chengdu has surpassed 6,000, contributing to a robust industrial ecosystem [4] Group 2: Investment Promotion Activities - The "2025 Chengdu Cultural and Creative Industry 'Li Yuan Man Yuan' Investment Promotion Inspection Activity" focused on the gaming and esports sector, attracting representatives from over ten well-known companies [1][16] - The event highlighted the city's commitment to fostering collaboration and exploring new opportunities in the gaming and esports fields [1][16] Group 3: Key Locations and Transformations - The inspection included visits to three major cultural and creative parks in Chengdu, showcasing the transformation of old industrial sites into vibrant cultural hubs [4][9][13] - The East Eight District Film and Cultural Park, a former industrial site, has been revitalized into a comprehensive ecosystem for film production, digital creation, and commercial activities [4][9] Group 4: Esports Industry Insights - Chengdu's esports industry is thriving, having produced hit games like "Honor of Kings" and hosted major tournaments, including the League of Legends Mid-Season Invitational [16] - The city aims to establish itself as an "Esports Cultural Capital," supported by government policies promoting high-quality development in the gaming and esports sectors [16][17] Group 5: Company Engagement and Future Plans - Companies like SNK and Shanghai Giant Network expressed strong interest in collaborating with Chengdu, citing the city's supportive environment and strategic planning for the gaming industry [20][23] - The event also focused on talent acquisition and collaboration opportunities, with local companies eager to engage in projects that promote the development of the digital cultural sector [24]

Core Viewpoint - The article discusses the recent financial troubles of Shi Yuzhu, a prominent businessman, due to frozen shares and guarantees made for friends, highlighting the risks associated with personal guarantees in business dealings [4][21][26]. Group 1: Share Freezing Events - Shi Yuzhu's shares worth over 3.9 billion yuan have been frozen, with the latest incident involving 277 million yuan in shares from Guangxi Beibu Gulf Bank [3][4]. - The previous freezing occurred in May 2023, where Giant Investment was implicated in a 490 million yuan execution case related to Lu Zhiyuan [4][10]. - The total amount of frozen shares related to Shi Yuzhu has exceeded 3.9 billion yuan, including significant amounts from companies he has been associated with [20][21]. Group 2: Personal Guarantees and Financial Impact - Shi Yuzhu has been involved in multiple guarantee cases, including a notable 1.8 billion yuan guarantee for Zhao Wei and her ex-husband, which led to significant financial repercussions for him [21][22]. - The article mentions that Shi Yuzhu's guarantees have resulted in a cumulative liability of approximately 5.8 billion yuan, highlighting the risks of high-leverage and personal guarantees in the capital market [21][26]. - Despite these challenges, Shi Yuzhu's company, Giant Network, has shown resilience with a reported revenue of 2.923 billion yuan in 2024, indicating a slight decrease but a significant profit increase of 31.15% [23][24]. Group 3: Return to Core Business - Following advice to focus on game development, Shi Yuzhu returned to Giant Network in September 2022, leading to a revitalization of the company's flagship game, "Zhengtu" [22][23]. - The introduction of new game features and marketing strategies has attracted over 25 million new users for the "Zhengtu" series, contributing significantly to revenue [23][24]. - The stock price of Giant Network has seen a substantial increase of approximately 74% since May 2025, reflecting positive market sentiment despite the ongoing financial issues [23][24]. Group 4: Historical Context and Future Outlook - Shi Yuzhu's business journey has been marked by cycles of debt and recovery, dating back to the 1990s when he faced significant financial challenges [25][26]. - The article suggests that despite his current wealth, the ongoing issues with frozen shares and personal guarantees may continue to pose risks to his financial stability and business operations [26][27]. - The narrative emphasizes the lessons learned from Shi Yuzhu's experiences, particularly regarding the dangers of mixing personal relationships with business commitments [27].

Core Viewpoint - The chairman of Giant Network, Shi Yuzhu, expressed the ambition for the game "Journey" to thrive for another 20 years, emphasizing the importance of respecting players as the key to achieving this goal [2][3]. Group 1: Player Engagement - The game has been successful for 20 years, largely due to the support from players, creating lasting memories and emotional connections [3]. - Shi Yuzhu highlighted the need for the development team to listen to player feedback, noting significant improvements in this area over the past few years [4]. Group 2: Game Quality Over Revenue - The focus should be on enhancing game quality rather than prioritizing revenue, as player satisfaction is paramount [4]. - The development team has shifted its approach to prioritize gameplay, correcting previous mistakes of overemphasizing income [4]. Group 3: User-Friendly Development - New features must be designed to be enjoyable and accessible for players, with a commitment to ensuring that the game remains engaging [4]. - Shi Yuzhu expressed satisfaction with the current development team's progress in making the game more user-friendly and anticipates further improvements [4].