Summary of 易点天下 Conference Call Company Overview - 易点天下 has over a decade of experience in overseas advertising services, accumulating extensive marketing data with clients spanning cross-border e-commerce, gaming, and entertainment industries. Cross-border e-commerce is the primary category, with partnerships including major brands like Alibaba, Shein, and Huawei [2][3] Core Business Insights - In 2023, 易点天下 restarted its programmatic advertising business, which has become a major revenue source by 2025, accounting for a significant percentage of total income. Revenue growth exceeded 50% in the first three quarters of the year, although short-term media subsidies have led to weak profit growth, similar to the development paths of companies like AppLovin [2][4][5] - The company leverages AI algorithms to optimize advertising ROI, making it attractive for brand owners to allocate budgets to these platforms, achieving rapid growth that can even surpass traditional media advertising effectiveness [2][6] Future Strategies - 易点天下 plans to focus on the e-commerce sector, utilizing accumulated customer data to train vertical AI model algorithms, enhancing platform ROI. The company is increasing media subsidies to onboard more media with direct SDK purchases, improving data feedback and differentiation in competition [2][7] - The overall development plan spans 2-3 years, with the company expected to remain in a spending phase until 2026, with profit release anticipated in 2027 and beyond. However, the market can foresee potential profit release through current revenue growth, with projected programmatic advertising revenue around 2 billion RMB in 2025 [2][8] Competitive Advantages - 易点天下 possesses two core advantages in programmatic advertising for e-commerce: a substantial data accumulation from major media operations and the ability to control budget allocation for e-commerce clients, allowing for flexible resource optimization [2][9] Challenges and Responses - The company faces challenges in the traffic domain, where the app media market is largely occupied by competitors. To address this, 易点天下 is implementing strategies such as subsidizing high-cost-performance media and focusing on AI-enabled mid-tail media to gain competitive advantages [2][10] Financial Projections - For 2025, 易点天下 anticipates programmatic advertising revenue of approximately 2 billion RMB, with a gross margin of around 18% and a net profit of over 200 million RMB after deductions. Daily consumption is expected to reach 1 million USD, with aspirations to increase this to 4-6 million USD in the following year [2][11] AI Applications - The company is actively expanding its AI applications, including collaborations with Alibaba Cloud to promote AI-driven content overseas, aiming to reduce production costs and enhance efficiency. Plans also include binding with AI content production teams to explore overseas markets through advertising monetization [2][12] Long-term Profit Outlook - Despite short-term profit pressures due to media subsidies, long-term profit release is expected as these subsidies decrease and programmatic advertising continues to grow. Projections suggest that if programmatic advertising revenue exceeds 3 billion RMB in 2026, net profits could reach over 600 million RMB, indicating significant potential for overall profit growth [2][13][14]

Investment Rating - The report initiates coverage with a "Buy" rating for the company, expecting a relative increase of over 20% compared to the benchmark index within six months [9]. Core Insights - The company has significantly increased its investment in AI, anticipating long-term benefits from overseas expansion [4][6]. - In H1 2025, the company reported a revenue of 1.737 billion yuan, a year-on-year increase of 59.95%, and a net profit of 144 million yuan, up 8.82% year-on-year [4]. - The e-commerce segment has shown remarkable growth, with revenue reaching 544 million yuan, a 102.22% increase year-on-year [5]. - The company is enhancing its programmatic advertising capabilities, which has led to improved gross margins [5][6]. - The company has established long-term partnerships with major global media platforms, positioning itself to benefit from the growing demand for overseas advertising [7][8]. Company Overview - Latest closing price: 32.25 yuan - Total shares: 472 million, circulating shares: 373 million - Total market capitalization: 15.2 billion yuan, circulating market capitalization: 12 billion yuan - 52-week high/low: 38.50/16.23 yuan - Debt-to-asset ratio: 37.9% - Price-to-earnings ratio: 65.82 [3]. Financial Projections - Expected revenues for 2025, 2026, and 2027 are 3.403 billion, 4.120 billion, and 4.795 billion yuan, respectively, with corresponding net profits of 278 million, 344 million, and 419 million yuan [11][14]. - The company anticipates an EPS of 0.59, 0.73, and 0.89 yuan for the years 2025, 2026, and 2027, respectively [9][11].

Core Viewpoint - The company is leveraging its partnership with AppLovin to enhance its programmatic advertising business and expand market share in the e-commerce sector [2] Group 1 - The company's programmatic advertising business is similar to that of AppLovin, positioning it as AppLovin's first-level e-commerce agent in Greater China [2] - The partnership allows AppLovin to access more e-commerce clients through the company, while the company benefits from a rapid business expansion and market share growth via the agency model [2] - Technologically, the company is improving its programmatic algorithm capabilities by utilizing AppLovin's brand and resources, which also enhances the company's brand and programmatic advertising business [2]