Summary of 360 Security Technology (601360 CH) Equity Research Report Company Overview - **Company**: 360 Security Technology - **Industry**: IT Services - **Date of Report**: 21 February 2025 Key Points AI Monetisation and Business Growth - The company has accelerated its AI monetisation, particularly through its AI search and office businesses, which are expected to significantly contribute to earnings growth [2][3][12] - The launch of 'Nano AI Search' on 27 November 2024 has resulted in over 4 million downloads and a monthly active user (MAU) count exceeding 1 million as of January 2025 [20][21] - Revenue from AI search is projected to be RMB 481 million in 2025 and RMB 566 million in 2026 [3][21] - The AI office VIP subscription model is expected to generate revenues of RMB 412 million, RMB 693 million, and RMB 1,009 million from 2024 to 2026, respectively [3][26] Financial Estimates and Adjustments - The 2024 EPS estimate has been revised to a loss of RMB 0.13, while the 2025 EPS estimate has been cut by 37% [4][33] - The company anticipates AI businesses to account for 5% of total revenue in 2024, increasing to 13% in 2025, and 19% in 2026 [29] - Traditional business revenue estimates have been reduced by 17% for 2024 and 18% for 2025 due to intense competition and declining demand [4][29] Valuation and Target Price - The target price has been raised to RMB 12.10 from RMB 4.40, reflecting a market capitalisation of RMB 84.5 billion [5][36] - The stock is currently trading at an 8.4x 2026 estimated price-to-sales (PS) ratio, in line with peer averages [2][5] Revenue and Profitability Metrics - Revenue for 2024 is estimated at RMB 7,906 million, with a projected growth to RMB 9,862 million by 2026 [13][29] - The company expects a net profit of RMB 732 million in 2026, following a net loss of RMB 885 million in 2024 [33][34] - Gross margin estimates have been raised due to a shift towards higher-margin AI-related businesses, with projections of 65.3%, 67.1%, and 67.9% for 2024, 2025, and 2026, respectively [29][34] Risks and Considerations - The report highlights potential risks associated with the company's reliance on AI monetisation and the competitive landscape in traditional internet businesses [5][36] - The investment thesis may change if AI monetisation accelerates beyond current expectations [5][36] Other Notable Information - The company has over 400 million average MAU for its PC browser and navigation, indicating a large potential user base for its AI VIP services [26] - The AI VIP system launched in June 2024 has seen active membership growth, reaching over 400,000 by December 2024 [25][26] This summary encapsulates the critical insights and financial projections for 360 Security Technology, reflecting its strategic focus on AI monetisation and the challenges faced in traditional business segments.

February 21, 2025 09:20 AM GMT Chinese Airports | Asia Pacific Consumption Slump in the Price; Await Catalysts We expect consumption pressure will continue to weigh on Chinese airports' earnings recovery in 2025. However, we think soft consumption is largely in the price. We await catalysts. Key Takeaways Duty-free spending is soft; we also think air traffic and air cargo volume growth are at risk... We remain guarded toward China's 2025 consumption outlook, considering soft GDP growth amid tariffs and pers ...

Summary of Fund Flow Insights - February 21, 2025 Industry Overview - The report focuses on the equity fund flows in both Developed Markets (DM) and Emerging Markets (EM), highlighting trends in inflows and outflows across various regions and fund types. Key Points Developed Markets (DM) - **Equity Fund Inflows**: DM equity funds experienced inflows of **US$16.8 billion** during the week ending February 19, 2025, with US ETFs contributing **US$12.9 billion** to unit creation [1][5][29]. - **Bond Fund Inflows**: Bond funds saw inflows of **US$16.2 billion** during the same period [1]. - **Performance**: The MSCI AC World index rose by **1.5%**, indicating positive performance across most funds [1]. Emerging Markets (EM) - **Equity Fund Outflows**: EM funds faced outflows of **US$5.3 billion**, with China ETFs alone accounting for **US$4.7 billion** in redemptions despite a **5%** rally in the MSCI China index [2][5]. - **GEM Funds**: GEM funds reported almost net zero flows, as inflows into ETFs were offset by redemptions from non-ETFs [2]. - **Regional Insights**: - India experienced **US$1.6 billion** in Foreign Institutional Investor (FII) outflows, while Taiwan saw **US$0.2 billion** in foreign inflows [2]. - Foreign flows in Korea remained weak, with nearly net zero flows [2]. Geographic Focus of Fund Flows - **North America**: Inflows of **US$12.5 billion** were noted, with a performance increase of **1.4%** [3]. - **Western Europe**: Inflows totaled **US$4.0 billion**, with a performance increase of **0.5%** [3]. - **Asia Pacific**: Japan saw negligible inflows, while other regions like EM Asia experienced significant outflows of **US$5.5 billion** [3]. Fund Type Analysis - **ETFs vs Non-ETFs**: The report indicates a trend where ETFs are attracting more inflows compared to non-ETFs, particularly in the US and Global markets [5][29]. - **Cumulative Flows**: The cumulative flows to equity funds versus bond funds were analyzed, showing a significant divergence in investor preferences [9][10]. Additional Insights - **Market Allocation**: The report emphasizes that market equity flows are estimated by multiplying fund flows into a fund group with the group's market allocation, providing a clearer picture of market dynamics [5][45]. - **ESG Funds**: The report also touches on flows to ESG funds, indicating a growing interest in sustainable investment options [112][120]. Conclusion The fund flow insights for the week ending February 19, 2025, reveal a robust recovery in developed markets, particularly in equity funds, while emerging markets continue to face challenges with significant outflows. The preference for ETFs over traditional funds is evident, reflecting changing investor behavior in the current market landscape.

A c t i o n | 20 Feb 2025 20:00:00 ET │ 36 pages North America Hardware & Storage Broader Recovery In Infrastructure Demand With Near Term AI Lumpiness, PC Demand More Tempered But Expected to Recover CITI'S TAKE Hardware OEMs are expected to report in the coming weeks. On a median basis, shares have modestly underperformed the S&P500 over a three- month period. From a fundamental perspective, overall infrastructure demand indicators (excluding AI) remain constructive with supply chain commentary (SNX, CDW) ...

Summary of the Conference Call on Greater China Tech Semiconductor Industry Overview - The focus is on the Greater China Tech Semiconductor industry, particularly in the context of AI and non-AI opportunities [1][2]. Core Insights - **Top Investment Ideas**: - Key Overweight (OW) recommendations include FOCI, Novatek, Asmedia, Nuvoton, Espressif, Montage, and Yangjie [5]. - Key Equal Weight (EW) recommendations include Aspeed and ASMPT [5]. - Key Underweight (UW) recommendations include Realtek, Winbond, and Macronix [5]. - **Market Dynamics**: - The broader semiconductor cycle recovery is slow, with AI cannibalization impacting general computing, consumer, and automotive sectors as enterprises prioritize AI investments [5]. - The value of AI semiconductors is increasingly tied to software rather than just semiconductor technology [5]. - China's capital expenditure (capex) is strengthening, leading to a slower recovery in mature node foundry utilization [5]. - An increase in semiconductor inventory days historically signals a negative trend for semiconductor stock price appreciation [5]. - **Long-term Demand Drivers**: - Tech diffusion is expected to drive a reacceleration in AI semiconductor demand, particularly due to generative AI applications across various sectors [5]. - Tech deflation is anticipated to stimulate demand for technology products through "price elasticity" [5]. Financial Metrics and Valuation - **Valuation Comparisons**: - TSMC (Ticker: 2330.TW) has a current price of 1,080.0 TWD with a target price of 1,388.0 TWD, indicating a 29% upside [6]. - UMC (Ticker: 2303.TW) has a current price of 43.0 TWD with a target price of 48.0 TWD, indicating a 12% upside [6]. - SMIC (Ticker: 0981.HK) shows a current price of 50.8 HKD with a target price of 38.0 HKD, indicating a 25% downside [6]. - **Performance Metrics**: - TSMC's P/E ratio is projected to decrease from 33.4 in 2023 to 17.7 in 2025, with EPS growth expected to rebound from -18% to 35% [6]. - UMC's P/E ratio is expected to decline from 8.8 in 2023 to 13.9 in 2025, with EPS growth projected to be negative [6]. Additional Insights - **AI Semiconductor Growth**: - Excluding NVIDIA's AI GPU revenue, non-AI semiconductor growth is projected at only 10% year-over-year in 2024 [11]. - The semiconductor supply chain is seeing a slight decrease in inventory days, which historically correlates with an increase in the semiconductor stock index [11]. - **Technological Advancements**: - TSMC's CoWoS (Chip on Wafers on Substrate) technology is becoming mainstream for 2.5D packaging, with plans for rapid expansion of advanced package plants in Taiwan [14][15]. - The global market for CoWoS is expected to grow significantly, with a projected CAGR of 172% from 2023 to 2030, reaching an estimated market size of US$9 billion by 2030 [36]. - **CPO Technology**: - CPO (Chip on Photonic Integrated Circuit) is highlighted as a power-saving solution that enhances data transmission speeds [26][36]. - FOCI is expected to see significant revenue growth from CPO-related business, primarily driven by partnerships with NVIDIA [38][41]. Conclusion - The Greater China Tech Semiconductor industry is navigating a complex landscape with both challenges and opportunities, particularly in AI and advanced packaging technologies. The focus on long-term demand drivers and strategic investments in key companies will be crucial for navigating this evolving market.

Deutsche Bank Research Asia Economics Asia Macro Insight 22 February 2025 Date Calm before the storm Despite US tariff threats, which prompted many of Asia's authorities to seek a deal with the US (with the exception of China), local markets remained relatively resilient, especially in the absence of aggressive follow-up actions against China. That said, we strike a note of caution, given that the US's comprehensive review and remedial action plan is not scheduled to be completed until April 1. While there ...

+1-212-816-8830 veronica1.clark@citi.com US Economics Weekly Freezing temperatures, frozen markets CITI'S TAKE As Fed officials and markets are in a holding pattern awaiting more data and policy clarity, the limited data that was released this week if anything reinforced our expectation for slowing growth this year. Housing construction and sales fell, and weaker homebuilder sentiment suggests limited upside. Manufacturing PMI remains modestly expansionary, but services PMI surprisingly fell into contractio ...

Summary of Unity Software Inc Conference Call Company Overview - **Company**: Unity Software Inc (U.N) - **Industry**: Internet and Gaming - **Market Cap**: $11.345 billion as of February 20, 2025 - **Current Stock Price**: $28.00 - **Price Target**: Raised from $26.00 to $32.00, with a bull case of $45.00 [1][2][13] Key Points and Arguments 1. **Introduction of Vector**: Unity announced an earlier-than-expected rollout of its new GPU-enabled ad algorithm, Vector, at the end of Q1 2025, which is expected to significantly enhance its advertising business and drive competitive return on ad spend (ROAS) for advertisers [4][9]. 2. **Impact on Financials**: The transition to Vector may create short-term challenges in Q1 as legacy ad products are phased out, but it is anticipated to lead to growth against easier comparisons in 2025 [4][12]. 3. **Growth in Ad Business**: The company is expected to leverage unique data from its Create game engine, which powers 70% of the market, to enhance the effectiveness of its ad campaigns [10][9]. 4. **Competitive Landscape**: Unity is viewed as a minimal competitive threat to AppLovin (APP), as it only needs to defend its market share to achieve growth, particularly in the gaming ads market [9][11]. 5. **4Q Results**: Unity reported strong 4Q results, with revenue and EBITDA exceeding prior estimates by 2% and 20%, respectively. Strategic portfolio revenue grew 4% year-over-year, with the Create segment growing 9% year-over-year [12][13]. 6. **Cost Management**: Stock-based compensation (SBC) decreased by 39% year-over-year, contributing to improved margins. The company also executed layoffs of approximately 300 employees in the Grow segment [12][13]. 7. **Future Guidance**: The company is shifting to quarterly guidance, which disappointed some analysts due to a 6% revenue and 19% EBITDA miss for Q1 estimates. However, this is attributed to the rapid rollout of Vector [12][13]. 8. **Long-term Outlook**: Analysts remain optimistic about Unity's strategy, raising revenue forecasts for 2025 and 2026 by 1%. The long-term estimates are largely unchanged as the company awaits results in the coming quarters [13][12]. Additional Important Insights - **Revenue Projections**: For FY 2025, Unity's revenue is estimated at $1.858 billion, with an EBITDA of $401 million and an EBITDA margin of 21.6% [31]. - **Valuation Methodology**: The price target is based on an enterprise value/sales (EV/Sales) methodology, applying different multiples for the Create and Grow businesses [13][19]. - **Market Positioning**: Unity's unified game engine and ad network are positioned as leading offerings in the gaming and interactive content space, with a consensus rating distribution showing 43% overweight, 50% equal-weight, and 7% underweight [25][26]. Risks and Considerations - **Market Competition**: The competitive landscape remains a concern, particularly with the strong performance of APP's advertising business [11]. - **Execution Risks**: Successful deployment and scaling of the Vector algorithm are critical for achieving projected growth and maintaining competitive advantages [10][9]. This summary encapsulates the key takeaways from the conference call, highlighting Unity Software Inc's strategic initiatives, financial performance, and market outlook.

Nick Maciunas AC (1-212) 834-5671 nicholas.m.maciunas@jpmorgan.com J.P. Morgan Securities LLC Alex Kraus (1-212) 834-5954 alexander.d.kraus@jpmorgan.com J.P. Morgan Securities LLC Sanjana Prasad (1-212) 834-5720 sanjana.t.prasad@jpmchase.com J.P. Morgan Securities LLC David Kaminsky (1-212) 834-5116 david.kaminsky@jpmchase.com J.P. Morgan Securities LLC North America Securitized Products Research J P M O R G A N 21 February 2025 Agency MBS There's a first time for everything Views • Mortgages are on the tig ...

21 February 2025 Big tech builds AGI Disruptive Technologies Global AI infrastructure accelerates The "compute" economy It has been a whirlwind start to 2025 in the race for big tech to build AGI (artificial general intelligence). The Trump administration announced Project Stargate, which promised to fund American AI infrastructure. Then a few weeks ago, the highly market disruptive Chinese AI model DeepSeek was released, sending investors and corporate stakeholders to take stock of the AI boom. What else? ...