In the first half of 2024, Venustech achieved operating revenue of 12.526 billion yuan, a year-on-year increase of 45.98%; the net profit attributable to the parent company was a loss of 0.154 billion yuan, a year-on-year decrease of 176.17%; Under the wave of AI on the edge, the income generated by the company in the high-tech and manufacturing fields reached 4.094 billion yuan, a year-on-year increase of 268.73%.
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Financial Association News, August 29th (Reporter Wu Xin) Tonight, Venustech (301236.SZ) released its mid-term report for 2024. The revenue maintained positive growth but the net profit attributable to the parent company turned into a loss. This was mainly due to a decrease in customer quotes, labor costs, and increased competition in the software outsourcing industry. However, under the trend of AI on the edge, the company's revenue in the smart terminal and smart automobile fields increased by 268.73% year-on-year.
The financial report shows that Venustech achieved operating revenue of 12.526 billion yuan, a year-on-year increase of 45.98%; the net profit attributable to the parent company turned into a loss, with a loss of 0.154 billion yuan, compared to a profit of 0.203 billion yuan in the same period last year; the non-recurring net profit attributable to the parent company turned into a loss of 0.21 billion yuan, compared to a profit of 0.143 billion yuan in the same period last year.
Affected by the acquisition of Insigma Technology, at the end of the reporting period, the asset-liability ratio increased by 21.45 percentage points compared to the end of the previous year, reaching 53.58%. Similarly, due to the purchase of assets, the company's operating costs increased by 57.12%, reaching 10.95 billion yuan in the first half of the year.
Due to improved collection efficiency and strict expense management, Venustech's net cash flow from operating activities improved slightly in the first half of the year, reaching -0.37 billion yuan, compared to -0.88 billion yuan in the same period last year.
In terms of products, the software and digital technology services segment achieved revenue of 8.513 billion yuan, accounting for 67.97%; the computing products and digital infrastructure services segment achieved revenue of 3.91 billion yuan, accounting for 31.22%; the digital energy and smart calculation services achieved revenue of 0.096 billion yuan, accounting for 0.76%.
Since the beginning of this year, the wave of AI on the edge has been surging. Smartphones, smart automobiles, and other terminals have all viewed AI as a new selling point, especially smart automobiles. With the promotion of software-defined cars and vehicle networking, integrating large-scale models into cars has become a popular trend. The demand for terminals is strong. Therefore, in H1 this year, Venustech achieved revenue of 4.094 billion yuan from the high-tech and manufacturing fields, a year-on-year increase of 268.73%.
In contrast, revenue from the communication equipment sector was 3.908 billion yuan, a year-on-year growth of 10.84%; revenue from the internet and operator, and fintech sectors, the former increased by 20.44% year-on-year, while the latter decreased by 13% year-on-year.
However, in the first half of the year, the gross margin of the company's various businesses have declined to varying degrees. The gross margin of the high-tech and manufacturing sector decreased by 7.89 percentage points, the communication equipment sector decreased by 6.39 percentage points, and the internet and operator, and fintech sectors decreased by 3.48 and 0.66 percentage points respectively.
The announcement shows that during the reporting period, in terms of market expansion in the high-tech and manufacturing sector, the company added 5 new customers in the smart terminal segment of the industry chain, with customer service covering operating systems, smart vision, and whole machine verification and other fields. As for smart automobiles, the company revealed that it is deepening cooperation with domestic and foreign leading car manufacturers and Tier 1 suppliers, with revenue in the smart automobile sector achieving double-digit growth year-on-year in the first half of 2024.
CLSA journalists have also learned that Softtek has completed a complete set of smart cockpit solutions based on multiple chip dual system integration (QNX+Android) such as Qualcomm and NXP, which have been implemented and delivered in multiple projects.
However, it should be noted that under the price war of smart phones and smart automobiles, the profit margin of software suppliers will also be squeezed. In addition, there is serious homogenization of AI terminal products in the current market, which will also have a negative impact on companies like Softtek. The company reminds in the announcement that customer demands are also showing a rapid iterative trend, which will bring certain challenges to the company's technological innovation.