Revenue accelerated in the second quarter, and the expansion strategy paid off clearly. The company released its 24-year report, with revenue of 0.191 billion yuan (+30.01%) for the first half of the year, net profit to mother -0.061 billion yuan (+23.43%), deducting non-attributable net profit of 0.063 billion yuan (+23.99%). Looking at Q2 alone, the company's revenue was 0.135 billion yuan (+41.45%), net profit attributable to mother was 0.026 billion yuan (+21.92%), and net profit not attributable to mother was 0.027 billion yuan (+24.13%). The company's personnel increased in the first half of the year compared to the end of '23. Under the orderly expansion, the revenue of the company's entire product line increased.

Initiatives to improve quality and efficiency have achieved results, and various product lines have continued to be strengthened. The company strictly controls and improves efficiency per capita, strengthens internal management and integrates resources. All departments carry out dual accounting in terms of revenue and costs, and cost control is continuously optimized. In the first half of the year, the company's sales, management, and R&D expenses changed by -22.36%, +44.05%, and -8.41%, respectively. The company's gross margin was 61.97%, a slight increase over the previous year. In addition to the steady growth of traditional gateway products, the company's security management products have maintained rapid growth in recent years. The self-developed ABT SPOS visual network security system platform is a network security system suite widely used by many first-tier manufacturers and large solution integrators. As an upstream manufacturer, the company closely tracks hot technology directions, such as zero trust, data security, cloud security, secure operation, etc., and quickly launches products to seize market opportunities. For example, zero trust products have achieved comprehensive breakthroughs in many industries.

The AI layout is predictable, and computing power and security go hand in hand. The company has taken AI+ security as the main strategic direction for the next stage. In the AIGC+ security gateway direction, based on the AIOPS concept, conversational AI capabilities are quickly implemented into the security gateway to provide simple and easy to use AI intelligent protection and operation and maintenance capabilities; in the AIGC+ security management direction, it is deeply cultivating visual network security integrating network security, data security, and cloud security.

At the same time, the company continues to expand its business direction, and applications have been implemented in AIGC+ digital IoT and AIGC+ digital energy. In terms of computing power, Shanghai Anbotong Computing Power Technology Co., Ltd., a subsidiary of Anbotong, was established to focus on the scheduling and orchestration of integrated heterogeneous computing networks, and launch software-based computing network brains and SRv6-based computing power products.

Risk warning: Macroeconomics affects IT spending; industry competition intensifies; new business development falls short of expectations.

Investment advice: Maintain an “better than the market” rating. Due to the impact of the pace of macroeconomic recovery, the profit forecast was revised down. The estimated net profit for 2024-2026 is 0.052/0.077/0.108 billion yuan (the original forecast was 0.152/0.222 billion yuan for 24-25). The current stock price corresponds to PE 41/28/20 times. The company's revenue bucked the trend and increased by more than 30% in the first half of the year. At the same time, the company's active layout in the AI field, computing power networks, etc. are expected to become new growth points for the company, maintaining a “superior to the market” rating.