According to a research report published by Morgan Stanley, China Unicom's first-quarter results were in line with expectations. Service revenue increased by 3.4% year-on-year. Among them, revenue from the Networked ICT business and Networked Digital Intelligence business both grew steadily, and Unicom's cloud revenue increased 30% year-on-year. The company's net profit for the first quarter exceeded 5.6 billion yuan, an increase of 8.9% year-on-year. Although it was in line with Damo's expectations, it was slightly lower than the company's full-year double-digit growth guide. Damo generally kept its profit forecast unchanged. The investment rating is still “increase in holdings”, with a target price of HK$6.5.