Performance performance

[Overall performance]

(1) Revenue of 491 million yuan (+31.72%) for 23 years, net profit attributable to mother - $288 million, net profit not attributable to mother - $335 million.

(2) 23Q4 revenue of RMB 268 million (+33.14%), net profit attributable to mother - RMB 20 million, net profit after deducting non-return to mother - RMB 38 million.

(3) 24Q1 revenue of 63 million yuan (+46.00%), net profit attributable to mother - 89 million yuan, net profit not attributable to mother - 93 million yuan.

[View by product]

In '23, big data and cloud-based platform software business revenue was 187 million yuan (+43.51%), distributed relational database software business revenue of 54 million yuan (+71.57%), data development and intelligent analysis tool software business revenue of 85 million yuan (+61.98%), and application and solution revenue of 79 million yuan (+29.33%).

[Gross profit ratio]

The gross profit margin in '23 was 59.61%, the year-on-year increase of 3.07pct, the 23Q4 gross profit margin was 60.07%, up 1.32pct; the 24Q1 gross profit margin was 69.27%, up 17.70pct; Note: The year-on-year growth rate is all shown in parentheses

Performance reviews

Revenue is growing rapidly, and profitability continues to rise

The company achieved revenue of 491 million yuan (+31.72%) in 23, 268 million yuan (+33.14%) in 23Q4, and 63 million yuan (+46.00%) in 24Q1. According to the company's annual report for the year 23, the number of customers that confirmed revenue was 578, up 12.5% from 514 in the same period in 2022. Among them, the number of high-value customers with confirmed revenue greater than 1 million increased from 101 in the same period last year to 134 during the reporting period. The company's average customer unit price increased significantly compared to the same period last year. At the same time, the company continues to improve quality and efficiency, actively focus on high-value and high-margin software licensing services, actively build a product technology ecosystem, cultivate delivery partners, and optimize service implementation costs. The company's gross margin increased from 56.54% in 2022 to 59.61%.

The three-fee rate has been reduced across the board, and the cost optimization results have been remarkable

The company's 23-year sales/management/R&D expense ratio was 53.50%/25.66%/45.45%, the sales expense ratio decreased by 1.58 pct year on year, the management expense ratio decreased by 6.90 pct year on year, and the R&D cost ratio decreased by 6.61 pct year on year. The company's total three-fee rate dropped from 139.70% in 2022 to 124.61% in 2023. At the same time, through continuous optimization of internal processes, the company has laid a solid foundation for the company's long-term sustainable development.

Embrace the big model+vector database and collaborate with Intel to create the AIPC application era AIPC can optimize performance by learning user behavior patterns, and provide more accurate information retrieval, content recommendation, and automated task processing. End-side large model products are required, as well as vector databases to transform content such as text, images, and videos into high-dimensional vector analysis and processing.

Starlink Technology provides:

1) Distributed vector database Hippo

2) Large model operation management software Sophon LLMops

3) End-side big model products: enterprise-level vertical question and answer big model “endless” and its derived big data analysis model “search”.

Starlink Technology released the “AIPC Edition” at the Intel commercial client AIPC product launch in March 2024, and pre-released the AIPC version of the “Wuyuan · Inquire” AIPC version. Currently, “Endless Life” and “Quest” have both been registered through the State Internet Information Office's In-depth Synthesis Service Algorithm.

By the end of 2023, orders for Big Model Era AI Infra related products provided by the company exceeded 54 million yuan.

Profit forecasting and valuation

We expect the company to achieve operating income of 681/8.99/1.01 billion yuan in 2024-2026, a year-on-year growth rate of 38.73%/32.07%/22.48%; net profit to mother in 2024-2026 will be -1.29/ -0.67/015 million yuan, respectively, corresponding to 8.16 times P/S in 2024. Maintain a “buy” rating.

Risk warning

There is a risk that industry competition has intensified, business development falls short of expectations, products and services provided cannot meet policy requirements in a timely manner, and progress in domestic substitution has not met expectations.