Core Insights - The 2025 China International Information Communication Exhibition has opened in Beijing, showcasing China Telecom's strategic advancements in digital transformation and artificial intelligence [1] Group 1: Company Initiatives - China Telecom is promoting its enterprise strategy towards "cloud transformation, data transition, and intelligent benefits," supporting the digital transformation of the economy and society [1] - The exhibition features the "Xingchen Large Model," which has core advantages of "full modality, fully self-developed, and fully domestically produced" [1] - The "Tianyi AI Glasses," weighing only 38 grams, are designed for comfort and equipped with AI voice technology, showcasing the company's focus on user-friendly AI applications [1] Group 2: Technological Developments - The exhibition highlights the integration of "computing power + platform + data + model + application" in China Telecom's intelligent cloud services [1] - The "Intelligent Transmission Network" demonstrates the future vision of intelligence flowing freely between "end-edge-cloud-network," emphasizing advancements in communication technology [1] - The "Fully Domestic Computing Power" exhibit showcases the domestic hardware of the Zijin computing architecture and the self-developed CTyunOS operating system, indicating China Telecom's comprehensive self-control capabilities from hardware to applications [1]

Core Insights - The 2025 China Computing Power Conference was held in Datong, Shanxi, focusing on building a new computing power ecosystem and stimulating new industrial momentum through computing power [1][4] - Major telecommunications operators and related enterprises discussed strategies for optimizing the computing power ecosystem and promoting high-quality development of the computing power industry [1] Group 1: China Telecom - China Telecom has developed an intelligent cloud system centered around its "Xiangran" technology, providing integrated intelligent cloud services through cloud-network integration [1] - Users can select, purchase, and activate computing resources via a computing power market, making the process as convenient as using utilities [1] - The "Lingze 2.0" platform has established a data element circulation trading platform in Shanxi, enhancing data rights and trusted circulation [1] Group 2: China Mobile - China Mobile introduced the computing network concept and launched the Computing Network Brain 3.0, marking a transition to an intelligent computing network era [2] - The Computing Network Brain integrates over 80 EFLOPS of diverse computing power and more than 250,000 network link resources [2] - A new "Chip Integration" platform was unveiled, providing a comprehensive service model for hardware and software adaptation, migration, testing, and certification [2] Group 3: China Unicom - China Unicom focuses on building new computing network infrastructure, with over 1 million standard racks and large-scale data centers in key regions [3] - The company has developed a GW-level park to support over 100,000 card clusters, achieving a computing capacity of 33 EFLOPS [3] - The "Xingluo" platform has been implemented in multiple regions, enhancing intelligent collaboration among massive clusters [3] Group 4: China Tower - China Tower is transforming communication rooms into data rooms, promoting edge computing infrastructure and resource sharing [3] - The company leverages 2.1 million tower sites and 1 million rooms to provide diverse products and services for edge computing [3] Group 5: Industry Trends - The transition from the "Information Age" to the "Intelligent Age" is driven by computing network infrastructure, which is deeply integrated with artificial intelligence [4] - The large-scale application of AI is propelling explosive growth in the computing power industry, leading to a rapid upgrade of computing infrastructure [4]

Investment Rating - The investment rating for the company is "Buy" and is maintained [9]. Core Insights - In H1 2025, the company's operating performance steadily improved, with a notable recovery in service revenue growth in Q2. The company maintains its guidance for good growth in revenue, EBITDA, and net profit for the full year. The core business showed steady growth, while emerging businesses rapidly developed, fully upgrading the strategy from "cloud transformation" to "cloud transformation and intelligent benefits" [2][12]. - The company achieved operating revenue of 269.4 billion yuan in H1 2025, a year-on-year increase of 1.3%, and a net profit attributable to shareholders of 23 billion yuan, up 5.5% year-on-year [6][12]. Summary by Sections Operating Performance - In H1 2025, the company reported revenue of 269.4 billion yuan, a 1.3% increase year-on-year, with service revenue at 249.1 billion yuan, up 1.2%. In Q2 alone, revenue reached 134.9 billion yuan, growing 2.6% year-on-year, and net profit was 14.2 billion yuan, a 7.1% increase [12]. - The company maintains its guidance for good growth in revenue, EBITDA, and net profit for the full year [12]. Core Business and Emerging Strategies - The mobile communication service revenue reached 106.6 billion yuan in H1 2025, up 1.3%, while fixed-line and smart home service revenue was 64.1 billion yuan, a 0.2% increase. The mobile ARPU was 46.0 yuan, down 0.6%, and broadband ARPU was 48.3 yuan, unchanged [12]. - The company is actively promoting the upgrade of its enterprise strategy from "cloud transformation" to "cloud transformation and intelligent benefits," enhancing the integration of innovative-driven core and digital businesses [12]. Financial Management - The company reduced its full-year capital expenditure guidance to less than 83.6 billion yuan, with H1 capital expenditure at 34.2 billion yuan, down 27.5% year-on-year. The operating cash flow net amount was 47 billion yuan, a 19.4% decrease year-on-year, while free cash flow increased by 13.9% to 13.1 billion yuan [12]. - The interim dividend per share was 0.1812 yuan, an 8.4% increase, with a payout ratio of 72%. The company clarified that the full-year payout ratio for 2025 will be further increased compared to 2024 [12].

Core Viewpoint - China Telecom's Tianyi Cloud has been recognized as a leader in the Chinese government cloud solutions market by IDC, highlighting its technological strength and market influence [1]. Group 1: Market Position and Technological Advancements - Tianyi Cloud is positioned as a key player in the digital transformation of government services, evolving from a traditional data platform to a smart computing foundation for urban digital reforms [3]. - The demand for government cloud services is expanding to include aspects such as intelligence, data circulation efficiency, security compliance, and innovative service models [3]. - Tianyi Cloud has established a comprehensive computing infrastructure network, including major data centers in the Yangtze River Delta and Beijing-Tianjin-Hebei regions, enhancing its capabilities in providing government cloud solutions [3][4]. Group 2: Product Offerings and Innovations - Tianyi Cloud has launched several key solutions, including dedicated cloud services, secure government cloud, integrated government cloud, smart city initiatives, and intelligent rural development, offering IaaS, PaaS, and SaaS services [4]. - New products developed to meet the needs of the AI era include the Xirang Smart Government Office Assistant and Xirang Intelligent Computing Machine, aimed at improving inter-departmental collaboration and creating a digital work loop [5]. - The company maintains a leading position in the government cloud market, with significant market shares in IaaS, PaaS, and SaaS, and plans to continue increasing R&D investment to enhance service quality [5].

Core Viewpoint - The 2025 World Artificial Intelligence Conference emphasizes the integration of artificial intelligence into various industries, with China Telecom leading the charge in transforming its strategy to embrace AI for economic growth [1][2]. Group 1: Company Strategy - China Telecom is shifting its strategy from "cloud transformation to data transformation" to "cloud transformation to intelligent benefits" [1]. - The company aims to enhance its AI service capabilities and strengthen security measures while promoting open collaboration [1]. - A comprehensive intelligent cloud service system will be developed, integrating computing power, platforms, data, models, and applications to support digital transformation across industries [1]. Group 2: AI Development in Shanghai - Shanghai is positioned as an international technology innovation center, and China Telecom is increasing its AI investments in the city [2]. - The company plans to accelerate the construction of "Smart Cloud Shanghai," transitioning from "cloud for the city" to "intelligent benefits for the city" [2]. - China Telecom will collaborate with local universities and research institutions to tackle cutting-edge AI challenges and support the establishment of an AI hub in Shanghai [2].

Core Insights - The 2025 World Artificial Intelligence Conference and the High-Level Meeting on Global Governance of Artificial Intelligence were held in Shanghai from July 26 to 28, highlighting the importance of AI in economic growth and transformation [1][2] - China Telecom's Chairman, Ke Ruiwen, emphasized the company's strategic shift from "cloud transformation" to "intelligent cloud transformation," aiming to enhance AI capabilities and services [1] Group 1: Company Strategy - China Telecom is embracing AI to drive its strategic upgrade, focusing on creating an integrated intelligent cloud service system that combines computing power, platforms, data, models, and applications [1] - The company aims to enhance its AI security governance capabilities by establishing a comprehensive dynamic protection system for AI [1] - China Telecom plans to increase collaboration and build a shared industry ecosystem to promote co-creation, governance, and sharing [1] Group 2: Regional Focus - Shanghai is positioned as an international technology innovation center, and China Telecom is intensifying its AI initiatives in the region [2] - The company is accelerating the "Smart Cloud Shanghai" project, transitioning from "cloud for the city" to "intelligent benefits for the city," to support urban digital transformation [2] - China Telecom is committed to increasing research investment in Shanghai and collaborating with local universities and research institutions to tackle cutting-edge AI challenges [2]

Core Viewpoint - The "Tianyi Cloud Xirang Cup" AI competition aims to promote innovation in artificial intelligence and cultivate young talent, with significant participation from universities across China [1][3]. Group 1: Event Overview - The competition attracted over 3,800 teams nationwide since its launch in September 2024, culminating in 60 elite teams reaching the finals [1]. - The event is co-hosted by major organizations including China Telecom, Huawei, and various academic societies, highlighting its importance in the AI sector [1][3]. Group 2: Strategic Importance - China Telecom emphasizes the need for self-reliance in key technologies and aims to build a strong digital infrastructure, positioning Tianyi Cloud as a national cloud framework [3]. - The competition serves as a platform for collaboration between academia and industry, fostering talent development and innovation in AI [3][5]. Group 3: Technological Advancements - Tianyi Cloud has developed the "Xingchen" model, a trillion-parameter AI model based on domestically produced technology, and the Xirang integrated intelligent computing service platform [3][5]. - The competition demands high computing power and stable technology platforms, which Tianyi Cloud's Xirang platform is designed to meet [5]. Group 4: Future Prospects - The AI competition is seen as a "nurturing ground" for practical AI talents and an "accelerator" for building a domestic AI ecosystem, contributing to the development of China's AI industry [5].

Core Insights - The Smart Cloud Ecological Conference was held with the theme "Digital Intelligence National Cloud, Co-composing New Chapters" [1] - China Telecom's Tianyi Cloud Company introduced the latest technological achievement, the Triless architecture, during the conference [1] Group 1: AI Application Challenges - 2025 is identified as the year of AI application, with all future applications expected to be born, grow, and mature in AI [3] - Three major challenges for large-scale AI implementation were highlighted: efficient acquisition of computing resources, selection of training and inference frameworks, and convenient development of customized AI applications [3] Group 2: Triless Architecture Features - The Triless architecture aims to address the challenges by being "computing resource agnostic," "training and inference framework agnostic," and "AI tool agnostic" [3] - The "Xiangrang" platform upgraded its computing resource scheduling technology to connect diverse, cross-domain, and heterogeneous computing resources, allowing users to utilize computing power without being aware of underlying differences [3] - A self-developed heterogeneous training and inference framework was introduced, compatible with both domestic and NVIDIA computing resources, enhancing the performance of domestic computing and achieving compatibility with over 120 models [3] - A standardized AI development pipeline was launched, abstracting and encapsulating the AI toolchain into a ready-to-use development environment, allowing developers to focus less on tool differences [3]

Core Viewpoint - The conference highlighted the importance of accelerating the infrastructure of artificial intelligence (AI) technology through four key breakthroughs, as presented by the general manager of Tianyi Cloud, Hu Zhijiang [3]. Group 1: AI Infrastructure Breakthroughs - The first breakthrough is the standardization of AI capabilities, aiming to provide users with standardized AI service capabilities similar to communication services, without the need to understand underlying technologies [3]. - The second breakthrough focuses on the universal accessibility of AI services, which involves unified scheduling and efficient operation of computing resources to continuously lower computing costs [3]. - The third breakthrough emphasizes the popularization of AI applications, transitioning AI technology from a mere auxiliary tool for consumer (C-end) use to a productivity tool for business (B-end) applications [3]. - The fourth breakthrough is the self-sufficiency of the entire AI industry chain, recognizing AI as a critical battleground for major powers and advocating for the autonomy of key technologies and ecological reconstruction of the industry chain [3]. Group 2: Key Focus Areas for Tianyi Cloud - Tianyi Cloud is focusing on three key areas: platform architecture, domestic core technologies, and AI application ecology to achieve significant breakthroughs [4]. - The platform architecture has been enhanced with the introduction of the Triless architecture, which allows developers to focus solely on business logic without managing servers, thus lowering the barriers for large model application services [4]. - The domestic core technology initiative is moving towards integrated research and development of foundational software, ensuring self-sufficiency across the entire industry chain [4]. - The AI application ecology has been upgraded with the second generation of cloud computers and an AI application center, targeting various scenarios such as government, education, research, and management [4].

Core Insights - The State-owned Assets Supervision and Administration Commission (SASAC) is accelerating the "AI+" initiative, focusing on enhancing the capabilities of central enterprises in the artificial intelligence sector, including applications, computing power, data, and models [1][5]. Group 1: Application Scenarios - Central enterprises are implementing AI across over 500 application scenarios in key industries such as industrial manufacturing, energy, and intelligent connected vehicles, leading to significant cost reductions and efficiency improvements in research, production, and customer service [2]. - High-value scenarios have been established, including the State Grid's "Bright" model for grid safety and renewable energy integration, China Petroleum's "Kunlun" model for oil and gas exploration, and China Electronics' "Yuanqi" model for financial services [2]. Group 2: Computing Power Infrastructure - Operators have developed computing power platforms such as "Xirang," "Cloud Xia," and "Hui Ju," which provide public computing power services to society [3]. Group 3: Data Collaboration - The initiative promotes data innovation and standardization by leveraging existing data advantages, resulting in high-quality data sets in key sectors like transportation, finance, and industrial manufacturing [4]. - The establishment of data annotation bases and investments in specialized data companies are underway to create industry-leading standardized products [4]. Group 4: Model Development - Major telecom companies have developed large-scale models with capabilities in multimodal processing and complex reasoning, enhancing industry-specific expertise through collaboration with state-owned and private enterprises [5]. - Future efforts will focus on application leadership, data empowerment, and strengthening foundational computing power to support technological breakthroughs and application implementations [6].