Investment Rating - The industry investment rating is "Outperform the Market," indicating that the industry is expected to perform better than the market benchmark over the next 12 months [56]. Core Insights - The WAIC conference highlighted key trends in technology innovation, emphasizing the acceleration of intelligent agent applications by companies like Tencent and JD.com, the rapid development of open-source ecosystems supporting AI, and the focus on world models and embodied intelligence [5][4]. - The report recommends companies with strong technological capabilities and broad application scenarios, including Alibaba, Tencent, Kuaishou, Baidu, Horizon Robotics, Li Auto, and Xpeng, as they are expected to benefit from the increasing demand for large model applications [5][4]. Summary by Sections AI Development and Applications - Tencent has launched over 10 intelligent agents across various verticals, while JD.com has open-sourced its JoyAgent intelligent agent [5][4]. - Alibaba's Tongyi Qianwen has surpassed 400 million downloads, with over 140,000 derivative models created [5][4]. - The report notes that Tencent's mixed 3D world model 1.0 significantly simplifies the 3D scene construction process, enhancing efficiency in game development and digital content creation [9][4]. Autonomous Driving - The report identifies a dual inflection point in the autonomous driving sector, with improved regulatory environments and the introduction of Tesla's advanced Full Self-Driving (FSD) technology in China expected to boost competition [4][5]. - The penetration rate of L2+ autonomous driving vehicles in China is estimated to be around 30-35%, with projections indicating it could exceed 50% by 2026 [4][5]. Company Recommendations - The report recommends investing in companies with robust technological foundations and diverse application scenarios, specifically highlighting Alibaba, Tencent, Kuaishou, Baidu, Horizon Robotics, Li Auto, and Xpeng [5][4]. - The anticipated growth in cloud business driven by the increasing demand for large model applications is expected to support the stock performance of these companies [5][4].

Core Viewpoint - The article discusses the evolution of JD's AI model, now branded as "JoyAI," emphasizing its transition from a focus on model training to practical applications in various industries, marking the beginning of a new phase in AI development [1][2][3]. Group 1: JoyAI Model Upgrade - JD has upgraded its AI model brand to "JoyAI," which now encompasses a wide range of modalities including language, voice, image, and video, showcasing advancements in AI technology [6][7]. - The upgraded JoyAI features models ranging from 3 billion to 750 billion parameters, achieving a 30% increase in inference efficiency and a 70% reduction in training costs [7][8]. Group 2: Application and Impact - JoyAI has been applied in hundreds of scenarios within JD, with a significant increase in model usage during the recent "618" shopping festival, showing a 130% increase compared to the previous "11.11" event [11][12]. - The digital human technology based on JoyAI has been widely adopted, with over 20,000 brands utilizing it, demonstrating its commercial viability [16][19]. Group 3: Future of AI in Industry - The article highlights the potential growth of China's core AI industry, projected to reach a market value of $140 billion by 2030, indicating a shift from AI as a supplementary tool to a critical component in various industries [14]. - JD's AI technology is not only advancing in digital humans but also expanding into logistics, retail, and healthcare, with applications that enhance productivity and service quality [44][53]. Group 4: JoyInside Platform - JD introduced the JoyInside platform, which integrates AI capabilities into smart hardware, allowing for personalized interactions and enhancing user engagement [29][32]. - JoyInside has been adopted by numerous companies, including educational and industrial applications, showcasing its versatility across different sectors [33][34]. Group 5: Investment and Ecosystem Development - JD is actively investing in the embodied intelligence sector, having recently invested in four companies, indicating a strategic focus on building a robust ecosystem around AI technologies [41][42]. - The company is opening its JoyInside platform to various brands, providing a comprehensive solution that includes software, hardware, and content integration [43][56].