Core Insights - The company reported a total revenue of 2.626 billion yuan for the first half of 2025, representing a year-on-year growth of 40.7% [2] - The core business, "Fourth Paradigm Prophet AI Platform," generated significant revenue of 2.149 billion yuan, with a year-on-year increase of 71.9%, accounting for 81.8% of total revenue [2] - The SHIFT intelligent solutions generated revenue of 371 million yuan, making up 14.1% of total revenue, focusing on key industries and strategic customer applications [2] - The company reported an operating loss of 848.8 million yuan, a reduction in loss of 55.1% compared to the same period last year [2] - The total assets of the company as of June 30, 2025, were 7.759 billion yuan, a growth of 2.26% from December 31, 2024 [3] - Total liabilities decreased to 1.497 billion yuan, down 39.78% from December 31, 2024 [3]

业绩高增，AI 驱动业务多领域拓展 第四范式(6682) ——第四范式（06682.HK）2025 年中报点评 [Table_Invest] 评级： 增持 [Table_CurPrice] 当前价格(港元)： 61.15 [Table_Market] 交易数据 52 周内股价区间(港元) 20.05-63.50 当前股本(百万股) 520 当前市值(百万港元) 31,778 [Table_Summary] 维持"优于大市"评级。在 Agent 加持下，公司已经进入高速增长轨 道，公司增发 H 股战略布局 AI+稳定币赋能业绩增长，我们预测公 司 2025-2027 年营收为 68.84 / 88.63 / 112.76 亿元（不变）；EPS 为 0.10 / 0.54 / 1.14 元，考虑到公司在 50 亿+的营收体量下营收增速仍 能逆势提升，给予公司估值 2025 年 6 倍 PS 不变，提高目标价 4% 至 86.79 港元（1 港元= 0.9158 人民币）。 | 财务摘要（百万人民币） | 2024A | 2025E | 2026E | 2027E | | --- | --- | --- | --- ...

Core Insights - Fourth Paradigm reported a significant revenue increase of 40.7% year-on-year for H1 2025, reaching 2.626 billion yuan, with a gross profit of 990 million yuan, reflecting a 25.4% growth [1] - The company's AI platform, "Prophet AI," generated 2.149 billion yuan in revenue, marking a 71.9% increase and accounting for 81.8% of total revenue [1][2] - The average revenue per benchmark user increased by 56.6% year-on-year to 17.98 million yuan, indicating enhanced value capture in the enterprise sector [1] Revenue and Profitability - The company achieved a gross margin of 37.71%, down 4.61 percentage points from the previous year, primarily due to a shift towards integrated delivery models [1][2] - Adjusted net loss narrowed by 71.2% to 44 million yuan, showcasing improved financial performance despite the loss [1] R&D and Expenses - R&D expenses rose by 5.1% year-on-year to 893 million yuan, with an R&D expense ratio of 34.0%, down 11.5 percentage points [1][2] - Total expenses for sales, management, and R&D were 189 million, 86 million, and 893 million yuan respectively, with corresponding expense ratios of 7.2%, 3.29%, and 34.0% [2] Market Position and Future Outlook - Fourth Paradigm has maintained the largest market share in China's machine learning platform sector for seven consecutive years, indicating strong competitive positioning [3] - The company is expected to benefit from the digital transformation across various industries in China, with projected revenues of 6.937 billion, 9.062 billion, and 11.797 billion yuan for 2025-2027, reflecting a compound annual growth rate of approximately 30% [3]

Core Viewpoint - The company has demonstrated significant revenue growth and a substantial reduction in losses in H1 2025, driven by its focus on "AI agent + world model" and continuous investment in R&D, positioning itself for further expansion in various industries through its "AI+X" strategy [1][2][3][4] Financial Performance - In H1 2025, the company achieved a revenue of 2.626 billion yuan, representing a year-on-year increase of 40.7% [2] - The adjusted net loss attributable to the parent company was 44 million yuan, narrowing by approximately 71.2% year-on-year [2] - R&D expenses for H1 2025 amounted to 893 million yuan, up 5.1% year-on-year, with a R&D expense ratio of 34.0%, down 11.5% year-on-year [2] Business Segmentation - The "Fourth Paradigm Prophet AI" platform generated revenue of 2.149 billion yuan in H1 2025, a year-on-year increase of 71.9%, accounting for 81.8% of total group revenue [3] - The SHIFT intelligent solutions business contributed 371 million yuan, approximately 14.1% of total revenue [3] - The Fourth Paradigm AIGS service business generated 106 million yuan, representing about 4.1% of total revenue [3] Strategic Initiatives - The company is actively exploring "AI+X" applications, particularly in the AI + energy storage sector, by launching a joint venture to optimize control of virtual power plants and enhance operational efficiency [4] - In the AI + stablecoin sector, the company is collaborating with leading brokerages to develop risk control and compliance solutions, ensuring the safety and stability of stablecoin assets [4]

Group 1 - The core viewpoint of the articles emphasizes the growth potential of the company, particularly through its standardized AI products and services, which are expected to capture a significant market share in the AI application sector [1][2] - The company's revenue is projected to be split between its Prophet platform and products (70% of revenue in 2024) and application development and other services (30% of revenue in 2024), indicating a diversified business model [1] - The management team consists of highly qualified individuals with backgrounds in top internet companies, which enhances the company's competitive edge in the AI market [1] Group 2 - The company is currently in a rapid penetration phase in the AI application market, with standardized products facilitating quick market entry and customer acquisition [2] - The company is also expanding into the consumer market with its Phancy brand, which is expected to generate over 2 billion yuan in annual revenue from its consumer electronics business [2] - The company is compared to Palantir in terms of product form, customer expansion, and development stage, suggesting a strong positioning in the domestic market [2] Group 3 - The company is expected to achieve revenues of 6.852 billion yuan, 8.819 billion yuan, and 11.226 billion yuan from 2025 to 2027, with year-on-year growth rates of 30%, 29%, and 27% respectively [3] - The projected net profit for the company is expected to turn from a loss to a profit, with significant growth rates of 417% and 101% in subsequent years [3] - Based on comparable company valuations, the company is estimated to have a reasonable market value of 37.3 billion yuan, indicating over 40% upside potential [3]

Investment Rating - The report initiates coverage with a "Buy" rating for the company [7] Core Views - The company is positioned to benefit from a standardized product strategy that enhances customer acquisition in the short term and maintains competitive advantages in the long term [6][9] - The company is expected to achieve significant revenue growth, with projections of 68.52 billion, 88.19 billion, and 112.26 billion CNY for 2025-2027, reflecting year-on-year growth rates of 30%, 29%, and 27% respectively [7][8] - The company aims to transition towards standardized products, which is anticipated to improve market penetration and customer retention [6][9] Financial Data and Profit Forecast - Revenue (in million CNY) for the years 2023A to 2027E is projected as follows: - 2023A: 4,204 - 2024A: 5,261 - 2025E: 6,852 - 2026E: 8,819 - 2027E: 11,226 - The revenue growth rates are expected to be 36.4% in 2023, 25.1% in 2024, 30.2% in 2025, 28.7% in 2026, and 27.3% in 2027 [5][7] - The net profit attributable to ordinary shareholders (in million CNY) is forecasted as follows: - 2023A: -909 - 2024A: -269 - 2025E: 55 - 2026E: 283 - 2027E: 568 - The net profit growth rates are projected to be 416.6% in 2026 and 100.9% in 2027 [5][7] Business Segmentation - The company's business can be divided into two main segments: 1. Prophet Platform and Products (70% of 2024 revenue) 2. Application Development and Other Services (30% of 2024 revenue) [6][22] - The Prophet Platform includes standardized software and hardware products, while Application Development encompasses SHIFT intelligent solutions and AIGS services [6][22] Market Positioning - The company is recognized as a leader in the Chinese machine learning platform market, having maintained the top position for seven consecutive years [20][21] - The company’s strategy focuses on leveraging industry know-how accumulated through benchmark projects to enhance its standardized product offerings [9][38] Growth Catalysts - Key growth drivers include exceeding revenue growth expectations, increased revenue contribution from the Prophet platform, successful expansion into the consumer electronics market, and rising downstream AI demand [10]

Core Viewpoint - The company reported strong revenue growth in 1H25, exceeding expectations, with a significant increase in the contribution from its AI platform, while also narrowing its net losses [1][2]. Financial Performance - 1H25 revenue reached 2.626 billion yuan, a year-on-year increase of 40.7%, with a net loss narrowing to 44 million yuan from 1.08 billion yuan [1]. - In Q2 25, the company achieved revenue of 1.549 billion yuan, representing a 49.2% year-on-year growth [1]. - Gross profit for 1H25 was 990 million yuan, up 25.4% year-on-year, but the gross margin decreased by 4.6 percentage points to 37.7% [2]. Business Development - The revenue from the AI platform, SHIFT intelligent solutions, and AIGS services was 2.149 billion yuan, 371 million yuan, and 106 million yuan respectively, with the AI platform's revenue growing by 71.9% [1]. - The number of benchmark customers reached 90, with an average revenue per user (ARPU) of 17.98 million yuan, a 56.6% increase year-on-year [1]. - The company improved its accounts receivable, with a balance of 1.967 billion yuan, down 36.3% from the end of 2024 [1]. Research and Development - R&D expenses for 1H25 were 890 million yuan, a 5.1% year-on-year increase, with the R&D expense ratio at 33.9%, down 11.5 percentage points [2]. - The company is enhancing its AI Agent and smart hardware business, exploring new growth areas in AI and stablecoin partnerships [2]. Valuation and Outlook - The company maintains its profit forecast, optimistic about business structure optimization, and has raised its target price by 8.3% to 65 HKD, indicating a potential upside of 20.3% based on current trading at 3.3x 26e P/S [2].

Core Viewpoint - Beijing DeepZero Technology Co., Ltd. (DeepZero) is seeking to list on the Hong Kong Stock Exchange, but it faces significant challenges as its revenue and net profit are declining in contrast to the high growth rates of the industry [1][4]. Company Overview - DeepZero claims to be the leading company in China's marketing and sales decision AI application market, yet it has reported a decline in both revenue and net profit for 2024 [1][4]. - The company aims to use the funds raised from the IPO for continuous R&D, expanding its sales network, seeking strategic acquisitions, and general corporate purposes [2]. Financial Performance - Revenue for DeepZero from 2022 to 2024 was 5.43 billion, 6.11 billion, and 5.38 billion RMB, respectively, with a year-on-year decline of 11.9% in 2024 [4][5]. - Net profit figures for the same period were 59.36 million, 60.66 million, and 21.97 million RMB, showing a significant year-on-year decline of 64.5% in 2024 [4][5]. Market Position - DeepZero claims a market share of 2.6% in the marketing and sales decision AI application market, ranking first, but the top three companies only hold a combined market share of 7.1% [7][8]. - The competitive landscape includes several AI giants, such as Fourth Paradigm and SenseTime, which have significant advantages in the market [8][9]. Profitability and Margins - The overall gross margin for DeepZero from 2022 to 2024 was 30.9%, 31.2%, and 27.3%, indicating a downward trend [10][11]. - The gross margin for its intelligent advertising business was 27.7%, 30.7%, and 27.4%, while the intelligent data management business saw a more significant decline from 45.9% to 26.6% [10][11]. R&D Investment - R&D expenditures for DeepZero from 2022 to 2024 were 46.87 million, 54.06 million, and 56.34 million RMB, representing only 8.6%, 8.8%, and 10.5% of total revenue, which is significantly lower than industry peers [13][15]. Customer Concentration - Revenue from the top five customers accounted for over 50% of total revenue from 2022 to 2024, indicating a high concentration risk [16]. - The largest customer, Alibaba, has seen its contribution drop from 4.4 billion RMB in 2021 to approximately 0.9 billion RMB in 2024, leading to a shift in the customer base [17].

Investment Rating - The report maintains an "Outperform" rating for the company [4][8]. Core Insights - The company has entered a high-growth trajectory supported by its Agent business, with a forecasted revenue growth of 30.85% in 2025, 28.75% in 2026, and 27.22% in 2027 [4][8]. - The first quarter of 2025 saw revenue of 1.08 billion RMB, a year-on-year increase of 30.1%, with a gross profit of 444 million RMB, also up 30.1% [4][8]. - The average revenue per key user reached 11.67 million RMB, reflecting a 31.3% year-on-year increase, indicating strong performance despite macroeconomic pressures [4][8]. Financial Summary - Revenue projections for 2025-2027 are 6.88 billion RMB, 8.86 billion RMB, and 11.28 billion RMB respectively, with EPS expected to be 0.11 RMB, 0.56 RMB, and 1.19 RMB [3][4][8]. - The company’s gross profit margin (GPM) for Q1 2025 was 41.2%, maintaining stability compared to the previous year [4][8]. - The Prophet AI platform generated 805 million RMB in revenue for Q1 2025, marking a 60.5% increase year-on-year [4][8]. Business Development - The company has upgraded to a dual 2B+2C business model, enhancing its capabilities in both enterprise and consumer sectors [4][8]. - The launch of the AI Agent development platform has enabled the company to cover the full lifecycle of AI Agent development, with applications across over 14 industries [4][8]. - The establishment of the Phancy consumer electronics sector aims to provide AI Agent solutions for devices, further diversifying the company's offerings [4][8].

Core Insights - Fourth Paradigm (06682.HK) reported a total revenue of 1.077 billion yuan for Q1 of FY2025, marking a year-on-year increase of 30.1% [2] - The company's gross profit reached 444 million yuan, also reflecting a 30.1% year-on-year growth, with a gross margin of 41.2% [2] - Following the positive earnings report, the stock opened 4% higher and surged over 8% during trading on May 16, reaching 42.9 HKD per share and a market capitalization of 21.1 billion HKD [2] Business Segment Performance - The "Prophet AI Platform," which constitutes 74.8% of total revenue, generated 805 million yuan in Q1, showing a significant year-on-year growth of 60.5% [5] - The SHIFT intelligent solutions segment reported revenue of 212 million yuan, down 14.9% year-on-year, with its revenue share decreasing to 19.7% due to strategic business expansion [5] - The AIGS service segment contributed 60 million yuan, accounting for 5.6% of total revenue [5] R&D and Future Plans - R&D expenses for Q1 amounted to 368 million yuan, an increase of 5.7% year-on-year, with an R&D expense ratio of 34.2%, down 8 percentage points [5] - The company plans to establish Paradigm Group, with the original Fourth Paradigm business becoming a core subsidiary, while also entering new sectors like consumer electronics [6] - The focus remains on enhancing AI capabilities across various industries, with a commitment to not pivoting away from enterprise services [6][7] Market Position and Profitability Outlook - Fourth Paradigm's overall R&D and revenue scale is smaller compared to peers like SenseTime, but it has a larger profit margin potential [7] - Based on current trends, the company is projected to achieve breakeven or positive net profit for FY2025, potentially becoming the third domestic AI software company to report profitability [7] - The vision is to leverage accumulated experience in vertical world models to expand AI capabilities beyond enterprise software, aiming for a broader market reach [8]