Core Viewpoint - The company reported a decline in revenue and an increase in net losses for the first half of 2025, but showed signs of recovery in orders and cash flow in the second quarter [1][2]. Financial Performance - The company achieved revenue of 338 million yuan in 1H25, a year-on-year decrease of 15.98%; net loss attributable to shareholders was 135 million yuan, with a non-recurring net loss of 134 million yuan, indicating an expanded loss compared to the previous year [1]. - In 2Q25, revenue was 233 million yuan, a year-on-year increase of 5.99%; net loss attributable to shareholders was 69 million yuan [1]. - The net cash flow from operating activities was -58 million yuan, showing significant improvement compared to previous periods [1]. Development Trends - There is a recovery trend in contract orders, with contract liabilities in 1H25 increasing by 37% year-on-year; direct sales contract amounts grew by 20.2%, with orders over one million yuan increasing by 72.7% [1]. - AI-related contracts amounted to 46.69 million yuan, with significant growth in contracts from central state-owned enterprises (up 57.8%) and government business (up 139.4%), particularly in government innovation products (up 170.9%) [1]. - The company’s second-quarter revenue and order recovery trends are expected to support annual revenue recovery [1]. Cost Management and Efficiency - The company continues to focus on cost reduction and efficiency improvement, with a notable decrease in operating losses and improved cash flow management [2]. - The gross margin saw a decline due to increased complexity and costs in direct sales projects, but the company managed to reduce sales, R&D, and management expense ratios [2]. - Accounts receivable decreased by 18.3% compared to the end of the previous year, indicating improved cash flow quality [2]. AI Investment and Applications - The company launched a new generation of AI products, CoMi, which integrates mainstream large models and proprietary collaborative operational models, enhancing its capabilities [2]. - The AI-native application, iForm, adopted a public cloud SaaS model, expanding its coverage to various industries [2]. - The company is developing AI applications in digital government and HR, increasing the practical deployment of AI [2]. Profit Forecast and Valuation - Due to short-term pressures on revenue and profit, the company has revised its 2025 revenue forecast down by 24.2% to 890 million yuan, predicting a net loss of 51.51 million yuan [3]. - For 2026, revenue is projected at 950 million yuan, with a net loss of 23.56 million yuan [3]. - The valuation has been adjusted to a 2026 P/S ratio, maintaining an outperform rating and raising the target price by 32% to 33 yuan, indicating a 7% upside potential from the current stock price [3].

Core Viewpoint - The company is preparing for its 2024 annual financial settlement and 2025 budget report, emphasizing the importance of maintaining shareholder rights and ensuring orderly conduct during the shareholder meeting [1][5]. Meeting Procedures - The meeting will be organized by a designated committee to ensure proper attendance verification and orderly proceedings [1][2]. - Shareholders and their representatives have the right to speak, inquire, and vote, but must register to speak and adhere to time limits [2][3]. - Legal representatives will witness the meeting and provide legal opinions on the proceedings [3][4]. Financial Performance - In 2024, the company achieved a total revenue of 846.53 million yuan, a decrease of 18.97% year-on-year, with a notable 8.7% growth in enterprise orders [6][7]. - Research and development expenses accounted for 25.15% of total revenue, an increase of 2.48 percentage points compared to the previous year, indicating a commitment to enhancing core competitiveness through sustained investment [6][7]. Business Segments - The company has strengthened its market position in key industries such as central state-owned enterprises, manufacturing, and healthcare, with a 20.8% increase in contract amounts from central enterprises [7][8]. - The introduction of standardized products for small and medium-sized enterprises has lowered digitalization barriers and improved management efficiency [8][9]. Product Development - The company has launched several AI-driven products, including the AI-COP platform and various versions of its software tailored for different market segments, enhancing operational capabilities [9][10]. - The upcoming release of the new generation AI intelligent product line, CoMi, is expected to provide customizable AI solutions for clients [12][13]. Governance and Compliance - The board of directors has conducted regular meetings to ensure compliance with legal and regulatory requirements, maintaining effective governance and oversight [18][20]. - The supervisory board has confirmed that the company’s financial management and internal controls are robust, ensuring the protection of shareholder interests [33][34]. Future Outlook - The company aims to enhance its operational efficiency and customer value through strategic initiatives focused on AI integration and platform development, targeting sustainable growth [27][28]. - Plans for 2025 include expanding market presence in Southeast Asia and the Middle East, as well as enhancing digital solutions for government services [28][29].

Investment Rating - The report maintains an "Outperform" rating for the company [1][5][11] Core Views - The company is expected to face short-term revenue and profit pressure due to economic conditions and extended project cycles, with projected EPS for 2025-2026 at -0.73 and -0.28 RMB, respectively, and a forecast of 0.32 RMB for 2027 [5][11] - Revenue projections for 2025-2027 are estimated at 903 million, 1.01 billion, and 1.15 billion RMB, respectively [5][11] - The target price is set at 35.27 RMB, based on a 4.5x PS for 2025 [5][11] Financial Summary - In 2024, the company achieved revenue of 847 million RMB, a decrease of 18.97%, with a net profit attributable to shareholders of -236 million RMB [5][11] - For Q1 2025, revenue was 105 million RMB, down 42.40%, with a net profit of -67 million RMB [5][11] - Corporate contract orders grew by 8.7% in 2024, with contracts over 1 million RMB increasing by 27.2% [5][11] Product Development - The company launched a new AI product line, CoMi, in Q1 2025, allowing customers to choose pre-made or customizable intelligent agents, contributing to a rich AI ecosystem [5][11] - The company continues to invest in platform and technology, enhancing business customization efficiency [5][11]