深信服

Summary of the Conference Call for 深信服 Company Overview - 深信服 operates primarily in the network security (60%-70% of revenue) and cloud computing sectors, with expectations for both to contribute equally by 2025-2026 [2][4] - The company has over 20 years of history, initially focusing on network security before expanding into cloud computing in 2015 [4] Key Insights and Arguments - Network Security Business: - Focuses on productization rather than operational services, maintaining a high gross margin of around 80% [5] - Products include VPNs, next-generation firewalls, and situational awareness tools, contributing 7%-8% to total revenue [5] - The business has stabilized and is expected to recover growth through AI-enhanced automated operations [6] - Cloud Computing Development: - The company leads the market in hyper-converged infrastructure, particularly benefiting from domestic substitution demand as foreign competitors exit [7] - Achieved nearly 20% growth in the first half of 2024, driven by increased demand from small and medium enterprises [7] - AI Opportunities: - 深信服 is well-positioned to leverage AI trends, providing comprehensive solutions for enterprises transitioning to AI, including data preparation, model training, and deployment [8] - The company’s strengths in cloud services and data governance allow it to integrate deeply with both foundational cloud and upper-level AI models [12] - Financial Performance and Projections: - Signs of recovery were noted in Q2 2025, with revenue growth, profit turnaround, and improved cash flow [13] - Projected cash flow for 2025 is estimated at 1.3-1.5 billion, with a valuation based on a 30x P/E ratio suggesting a safety margin of approximately 40-45 billion [13] - Long-term conservative valuation could reach 100 billion, significantly driven by cloud computing contributions [13] Additional Important Points - Market Positioning: - The company primarily serves mid-tier clients, avoiding direct competition with larger players like Alibaba [12] - Future Growth Potential: - If revenue growth reaches 10%-20% in 2026, the valuation could exceed 90 billion, with significant contributions from cloud computing [13] - The overall market sentiment towards the AI industry is positive, allowing for early investment without waiting for 2026 performance [13]