Group 1 - The 2025 Global Artificial Intelligence Terminal Exhibition opened in Shenzhen, showcasing the latest technological breakthroughs in the AI terminal field and promoting the integration of technology, capital, talent, and scenarios [1][15] - Shenzhen launched two industry funds focused on artificial intelligence and embodied robotics, with the Shenzhen AI and Embodied Robotics Industry Fund having an initial scale of 2 billion and the Shenzhen AI Terminal Industry Investment Fund at 5 billion [18] - The exhibition featured various immersive experience zones, including industrial collaborative robots and medical rehabilitation robots, allowing attendees to explore the potential applications of AI across multiple sectors [4][10] Group 2 - The AI glasses section was a highlight, with significant advancements in voice interaction and dynamic visual perception, moving towards the consumer market [4] - TCL showcased the Thunder X3 Pro smart glasses, which are lightweight and capable of real-time translation, with a market share exceeding 50% in the AI/AR glasses segment in Q1 [7] - The exhibition included five major zones, focusing on smart terminals, large model applications, innovative products, core technologies, and human-robot interaction, aiming to drive the evolution of "cloud collaboration" to "edge intelligence" [15][10] Group 3 - Shenzhen has over 2,600 AI-related companies, with the smart terminal industry cluster's added value reaching 204.55 billion, a year-on-year growth of 9.9% [21] - The exhibition serves as an important window to observe the high-quality development of Shenzhen's AI industry, with a full-chain support system from basic research to scenario implementation [21] - The event is guided by the Shenzhen Municipal Bureau of Industry and Information Technology and aims to position Shenzhen as a global AI pioneer city [17][18]

Investment Rating - The report maintains a "Strong Buy" investment rating for the company [3][7]. Core Views - The company is expected to face profit pressure in 2024 due to mergers and acquisitions, but the software business shows signs of stabilization and improvement. The company is well-positioned to capitalize on opportunities in AI and domestic production [1][7]. - The company achieved a total revenue of 31.316 billion yuan in 2024, reflecting a year-on-year growth of 78.13%, while the net profit attributable to shareholders was 180 million yuan, down 66.21% year-on-year [7]. - The report emphasizes the company's strategy of integrating hardware and software, which is expected to enhance profitability in the future [7]. Financial Data and Valuation - Total revenue projections for the company are as follows: 17.581 billion yuan in 2023, 31.316 billion yuan in 2024, and expected growth to 32.906 billion yuan in 2025 [2][13]. - The net profit attributable to shareholders is projected to recover from 180 million yuan in 2024 to 370 million yuan in 2025, with a growth rate of 105% [2][14]. - The company's price-to-earnings (PE) ratio is projected to decrease from 306.9 in 2024 to 149.5 in 2025, indicating a potential improvement in valuation [2][14]. Business Performance - In 2024, the company's software and digital technology services generated revenue of 18.121 billion yuan, while the computer products and intelligent electronics business contributed 12.920 billion yuan [7]. - The company has launched several AI products and established strategic partnerships to enhance its offerings in various industries, including insurance, retail, and healthcare [7]. - The company is focusing on domestic production, with its PC terminal business leading in the government and education sectors [7].