Koal(SH:603232)2025-07-25 00:52Summary of the Conference Call for Geer Software Company Overview - Company: Geer Software - Industry: Cybersecurity and Encryption Technology Key Points and Arguments 1. Performance Expectations: Geer Software anticipates landing orders of approximately 600-700 million yuan this year, representing a year-on-year increase, and maintains a neutral to slightly optimistic outlook for overall performance [2][3][20] 2. Sector Performance: The government and party sectors performed well, while the financial sector saw banks outperforming securities. However, the military sector experienced a significant decline compared to the previous year, negatively impacting overall performance [2][3][20] 3. Strategic Shift: The company is shifting its strategy to reduce reliance on encryption as a single label and is expanding into data, AI, and IoT. This includes developing a data middle platform, AI application security, and lightweight encryption products [2][5][6] 4. Market Potential: The encryption industry is characterized by strong certainty due to its connection to national security, with significant market potential. Emerging applications are challenging traditional encryption products, necessitating lightweight and user-friendly designs [2][6] 5. Next-Generation PKI Products: The next-generation Public Key Infrastructure (PKI) products will include quantum-resistant technology, with preparations underway to address risks posed by quantum computing [2][8][9] 6. Financial Sector Demand: There is a strong demand for quantum-resistant technology in the financial sector, with key information fields such as military, government, and state grid showing significant interest. Policy developments are expected to accelerate adoption [2][11] 7. Acquisition Strategy: Geer Software has acquired over 50% of Shenzhen Weipin Zhiyuan, focusing on its data middle platform capabilities and relationships with operators and manufacturers, which will help expand AI customer bases and move beyond a single security label [3][13][15] 8. Future Directions: The company aims to integrate more AI capabilities into its next-generation PKI systems and develop markets for data security and AI security, which are currently underdeveloped [14][15] 9. Financial Performance of Acquired Company: Weipin Zhiyuan reported approximately 500 million yuan in revenue and nearly 40 million yuan in profit for 2024, which enhances Geer Software's future growth potential [17] 10. Market Trends: The overall market for quantum-resistant encryption is expected to grow, with standards anticipated to be established by the end of 2025. However, large-scale mandatory replacements are not expected in the short term [21][22] Additional Important Insights - Customer Adoption: There are two types of customers regarding quantum-resistant solutions: those willing to invest heavily and adopt immediately, and those proceeding gradually according to policy [12] - Government Spending Influence: Special government bonds are expected to have a limited but positive impact on cybersecurity spending, particularly in the military sector [20] - Long-Term Outlook: The encryption technology market is projected to have substantial applications over the next 10 to 20 years, especially with the rise of IoT [6][7]