Summary of Shenzhou Taiyue Conference Call Company Overview - **Company**: Shenzhou Taiyue - **Industry**: Gaming and Computer Services Key Points Financial Performance - In Q3, the company achieved a revenue of 8 billion yuan, a year-on-year decrease of 10% [3] - Cumulative revenue for the year to date is 4 billion yuan, indicating a trend of narrowing revenue decline [3] - The net profit after deducting non-recurring items shows a significant quarter-on-quarter narrowing, reflecting stable operational conditions [3] Performance of Existing Games - Q3 non-recurring profit mainly derived from existing games, with almost all profits coming from older titles [4] - Revenue from older games has shown a decreasing trend since last year, but the decline is narrowing each quarter, indicating good performance [4] New Product Development - Two new games, DL and LOV, are currently in testing and require modifications for optimization; the launch timeline remains unclear [5] - Three new SLG titles are progressing as per the planned schedule [5] Market Competition and Strategy - The overseas market is experiencing intense competition, but the performance of both new and existing games remains stable [8] - The company has a diversified product line, including light and casual games, which accounts for approximately 20% of its reserves [8] Game Project Evaluation - The company employs strict standards for evaluating and selecting game projects, focusing on long-term operational potential [9] - Non-SLG games have a low probability of successful project initiation due to these stringent criteria [9] Computer Business Outlook - Q4 is traditionally a peak season for the company's computer business, expected to continue the growth trend [10] - Cloud services and Xiaoman business are performing well, while the Arvox product is expected to show user growth but limited revenue contribution in the short term [10] Q4 Game Business Expectations - The game business in Q4 is expected to remain stable, primarily driven by revenue from older games, with no large-scale promotion of new titles anticipated [11] - The overall performance across both computer and gaming sectors is expected to be stable in Q4 [11] New Game Launch Strategy - The domestic launch of new games typically follows the overseas launch schedule, with plans to promote in China approximately six months after the North American launch [12] - The three upcoming new games are still under production, and their performance predictions remain uncertain [12] Arvox Product Update - Arvox was launched in late July and has seen a steady increase in user numbers, although specific data has not been disclosed [13] - As a small B-end product, its revenue contribution is expected to be minimal initially, with plans for overseas promotion in the upcoming year [13]

New Token Offerings - Binance Wallet's exclusive TGE Phase 38 launches JoJoWorld (JOJO) [1] - 32 million JOJO tokens will be reserved for future events [1] - Binance Alpha will launch Dill (DL) at 11:30 AM (UTC) on September 19 [1] Launch Details - JoJoWorld (JOJO) subscription period is open from 9:00 AM to 11:00 AM (UTC) on September 19 [1]

Summary of Shenzhou Taiyue Conference Call Company Overview - **Company**: Shenzhou Taiyue - **Industry**: Gaming and Software Development Key Financials - **Revenue**: 1.36 billion CNY, a quarter-on-quarter increase of 2.85% [2] - **Net Profit**: 270 million CNY, a quarter-on-quarter increase of 13.45%, indicating steady improvement in overall profitability [2] - **First Half of 2025**: Revenue of 2.685 billion CNY, a year-on-year decrease of 12%; net profit of 509 million CNY, a year-on-year decrease of 19.26% [3] Gaming Business Insights - **Revenue Source**: 92% of revenue comes from the overseas gaming market, with North America contributing approximately half [2][12] - **Upcoming Games**: Two games, DL and LA, are nearing launch on the Apple Store, with three additional SL products expected to enter commercialization testing in Q1 and Q2 of 2026 [2][4][8] - **Existing Games**: The games "Sunrise City" and "War Fire and Order" are performing well, with stable revenue maintained through frequent updates and consistent investment [6] Software Business Developments - **Abox Smart Voice Robot**: Launched with a subscription model based on call duration, showing good market feedback and plans for international expansion [5][7] - **Productization and Internationalization**: The software segment is experiencing continuous growth, with a focus on productization and international outreach [5][11] Market Strategy and Trends - **New Product Development**: The company is accelerating the pace of new product launches, integrating various themes and gameplay styles to capture the expanding SLG market [10] - **Cultural Elements**: Games incorporate Chinese cultural elements, which have been well-received by overseas players [13][14] - **Competitive Landscape**: The SLG market is highly competitive, with established players dominating due to their understanding of overseas player preferences [14] Future Outlook - **Game Development Focus**: Emphasis on refining product quality and learning from successful market examples to enhance new product offerings [15][16] - **Profitability of Software Products**: The subscription model for Everbox is expected to yield high profit margins, with a focus on customer feedback and demand growth [17][18] - **Domestic Market Plans**: Domestic versions of games have been completed and are expected to launch soon, aligning closer with overseas release schedules [19]

Investment Rating - The report maintains a "Buy" rating for the company, with a target price of 8 HKD, corresponding to a P/E of 20x for 2025 and 16x for 2026 [4][7]. Core Insights - The company reported a revenue of 2.24 billion USD for the first half of 2025, representing a year-on-year growth of 6.8%, driven by the continuous growth in the Asia-Pacific region [1]. - The adjusted EBITDA for the first half of 2025 reached 230 million USD, a year-on-year increase of 16.8%, benefiting from the higher revenue share from the Asia-Pacific region [2]. - The company is actively advancing its line control chassis technology, including line control steering and braking systems, with expectations of securing more orders in the second half of the year [3]. Revenue and Profitability - The company's gross margin improved by 1.5 percentage points year-on-year to 11.5%, with gross profit increasing by 22.7% to 260 million USD [2]. - The net profit attributable to shareholders surged by 304.5% year-on-year to 63.48 million USD, with a net profit margin of 2.8% [2]. - The Asia-Pacific region's revenue share increased by 2.3 percentage points to 30.6%, with a significantly higher EBITDA margin compared to North America and EMEASA [4]. Future Outlook - The company expects to achieve a record high in annual revenue, outperforming the market by 300-400 basis points, with a target of 5 billion USD in orders for the year [1]. - Revenue projections for 2025-2027 are estimated at 4.6 billion USD, 4.8 billion USD, and 5.1 billion USD, respectively, with net profits expected to grow significantly [4][6].