Group 1 - The Ministry of Industry and Information Technology supports accelerating technological breakthroughs and industrialization of automotive chips, with institutions noting that automotive simulation chips are entering a concentrated release phase. A company has over 200 automotive-grade chips applied in various scenarios such as intelligent cockpits, intelligent driving, intelligent connectivity, vehicle body, chassis, and power systems [1] - Eight departments have issued a document conditionally approving the production access of L3-level vehicles. Institutions claim that the intelligent driving industry has reached a critical point. A company integrates people, vehicles, roads, and clouds, providing a new generation of intelligent connected vehicle solutions covering everything from networked terminals to business platforms and user touchpoints. The company has also independently developed L4-level unmanned electric sightseeing buses [1] - A company is set to release a 1.6T LPO module sample and a 51.2T CPO switch based on commercial scenarios [1]

Core Insights - The global demand for AI computing power is experiencing unprecedented explosive growth, while the process of domestic substitution is accelerating [1] - The A-share market is witnessing significant development in three major technology sectors: computing power, CPO (Co-Packaged Optics), and PCB (Printed Circuit Board) [1] Group 1: Computing Power Infrastructure - Gansu Qingyang has successfully deployed a domestic 100,000-card intelligent computing cluster, utilizing a fully autonomous architecture and Ascend chips, marking a significant advancement in China's computing power infrastructure [1] - This achievement breaks international technological barriers and signifies a leap from "usable" to "optimal" computing power infrastructure [1] Group 2: CPO Technology - CPO technology integrates optical modules with chip packaging, significantly reducing signal transmission losses and greatly enhancing the energy efficiency and bandwidth of data centers and AI servers [1] - Morgan Stanley predicts that the CPO market will surge from $8 million in 2023 to $9.3 billion by 2030, with a staggering compound annual growth rate (CAGR) of 172% [3] Group 3: PCB Market - The PCB sector is also showing strong growth, driven by the rapid increase in AI inference demand, with applications in servers, switches, and optical modules [3] - Prismark forecasts that the AI server PCB market will achieve a CAGR of 32.5% from 2023 to 2028 [3] Group 4: Investment Opportunities - ZTE Corporation is actively pursuing a "computing power network" strategy, providing comprehensive ICT infrastructure solutions and has won multiple domestic intelligent computing center projects [4] - ZTE has collaborated with NVIDIA to develop a 51.2T CPO switch, setting a new industry record for single-chip bandwidth, which is already applied in Meta's data center [4] - Huada Technology, a leading AI server PCB supplier, has orders booked until 2026 and has made significant breakthroughs in 800G optical module PCB signal integrity [4] - Shengyi Technology, the second-largest copper-clad laminate manufacturer globally, holds over 20% market share in the high-frequency and high-speed CCL market and has achieved a 99.5% yield rate for 800G optical modules [5] - The company has also developed high thermal conductivity PCBs for liquid-cooled servers, successfully applied in the 100,000-card intelligent computing cluster in Qingyang [5] - The top potential stock, H3C, leads the domestic switch market and ranks among the top three globally in AI server shipments, having launched the 51.2T 800G CPO silicon optical switch [4][5]

Core Viewpoint - The company reported a revenue of 16.758 billion yuan for 2024, reflecting a year-on-year increase of 5.35%, while the net profit attributable to shareholders was 405 million yuan, showing a decline of 4.76% [3] Group 1: Financial Performance - In Q4 2024, the company achieved a revenue of 4.872 billion yuan, a slight increase of 0.34% year-on-year, and a net profit of 142 million yuan, which is a significant increase of 16.22% year-on-year [3] - The gross margin for Q4 2024 was 38.13%, representing a quarter-on-quarter increase of 6.29 percentage points [3] Group 2: Product Innovation and Development - The company made breakthroughs in network infrastructure products, particularly in the data center sector, enhancing its innovation capabilities and driving the development of data center infrastructure [4] - The AI-FlexiForce intelligent computing center network solution achieved large-scale delivery and won the "Annual Influential Solution Award" [4] - The company launched innovative products such as the TH5 switch, 51.2T CPO switch, and globally leading 400G/800G LPO optical modules in 2024 [4] Group 3: Expansion in AI Applications - In the field of trusted computing (信创), the company developed the "Shenghua" series machines based on Huawei's latest Kirin 9000C chip, aiding various sectors like government, state-owned enterprises, education, and healthcare in achieving intelligent upgrades [5] - The company received telecom equipment network access licenses for multiple AI voice core products, enhancing its competitiveness in the operator market and industry private networks [5] - In the vehicle networking sector, the company advanced its ODM and EMS businesses, solidifying its presence in North America while expanding into over 20 countries across Europe, Africa, Asia, and South America [5]

Core Viewpoint - The company reported a revenue of 16.758 billion yuan for 2024, reflecting a year-on-year increase of 5.35%, while the net profit attributable to shareholders was 405 million yuan, down 4.76% year-on-year [1] Group 1: Financial Performance - The company achieved Q4 revenue of 4.872 billion yuan, a slight increase of 0.34% year-on-year, with a net profit of 142 million yuan, up 16.22% year-on-year [1] - The gross margin for Q4 was 38.13%, showing a quarter-on-quarter increase of 6.29 percentage points [1] Group 2: Product and Market Development - The company made significant breakthroughs in network infrastructure products, particularly in the data center sector, enhancing its innovation capabilities [2] - The AI-FlexiForce intelligent computing center network solution was delivered on a large scale and won the "Annual Influential Solution Award" [2] - The company launched innovative products such as the TH5 switch, 51.2T CPO switch, and leading global 400G/800G LPO optical modules [2] Group 3: AI Applications Expansion - In the field of trusted computing, the company developed the "Shenghua" series machines based on Huawei's Kirin 9000C chip, aiding various sectors in achieving intelligent upgrades [2] - The company received telecom equipment access licenses for multiple AI voice core products, enhancing competitiveness in the operator market and industry private networks [3] - The company made strides in smart medical solutions, which were implemented in national regional medical centers across provinces like Shandong, Shanghai, and Beijing [3] Group 4: Market Outlook and Profit Forecast - The company adjusted its net profit forecasts for 2025 and 2026 downwards by 39% and 42% to 510 million yuan and 622 million yuan, respectively, while introducing a new forecast of 728 million yuan for 2027 [3] - The company maintains a "buy" rating, anticipating growth opportunities from AI intelligent computing center networks and increased demand for white-label switches in data centers driven by operator investments [3]