2024Q2's revenue increased rapidly, and global multi-channel expansion led to growth in all categories, maintaining the “buy” rating of 2024H1 with a revenue of 9.65 billion yuan (+36.55%, same below), net profit to mother of 0.872 billion yuan (+6.36%), deducting non-net profit of 0.77 billion yuan (+40.53%). 2024Q2 revenue of 5.27 billion yuan (+42.43%), net profit due to mother of 0.56 billion yuan (+9.2%), after deducting non-net profit of 0.45 billion yuan (+50%), after deducting the high increase in non-profit is mainly the difference in profit and loss due to changes in fair value. In the long run, categories such as charging and energy storage/video/security are expected to continue to perform well under strategic focus and channel deepening. We will maintain 2024 and raise our profit forecast for 2025-2026. We expect net profit to the mother for 2024-2026 of 1.975/2.359/2.838 billion yuan (original value of 1.975/2.332/2.708 billion yuan), corresponding EPS is 3.72/4.44/5.34 yuan, and the current stock price is 17.0/14.2/ 11.8 times, brand potential has increased, and the deepening of diversified global channels is expected to drive continued growth in all categories and maintain a “buy” rating.

The growth rate of 2024Q2's offline channels increased significantly month-on-month. Global multi-channel expansion led to high growth in various categories: 2024H1 charging, energy storage/intelligent innovation/smart video products had revenue of 4.975/2.36/2.309 billion yuan respectively, +42.81%/+35.33%/+30.84% year-on-year respectively. On the one hand, the high increase in charging energy storage is the company's continuous promotion of new products and the increase in energy storage products; on the other hand, demand in the industry may be strong. You can refer to Greenlink Technology/Aohai Technology's 2024H1 charging business revenue compared to +53.5%/+57% year-on-year. Subregions: 2024H1 North America/Europe/Japan/Middle East/Mainland China/Australia/Other regions were 46.3/20.5/12.9/5.7/0.38/0.34/0.39 billion yuan, respectively, up to 40.68%/+44.6%/+21.5%/+39.17%/+39.3%/+22.91%/+15.67%, respectively. Sub-channels:

Looking at the breakdown, 2024H1 Amazon/other tripartite platforms/independent sites/offline revenue was 50.4/0.76/0.93/2.92 billion yuan respectively, +27.7%/+67.4%/+103%/+32.3% year-on-year respectively. Online third-party platforms and independent websites increased rapidly, and brand power continued to increase. 2024Q1/2024Q2 offline revenue was +22.37%/+41% year-on-year respectively. As the company continued to deepen global offline channels, the 2024Q2 offline revenue growth rate increased significantly compared to Q1.

Gross margin continued to accelerate as favorable external factors of 2024Q2 continued to accelerate. Expense ratios remained stable 2024Q1/2024Q2 gross profit margins of 45.12%/45.23%, +3.59/+0.55pct, respectively. The year-on-year increase in gross margin in a single quarter slowed or mainly due to a weakening of the positive exchange rate contribution+increase in shipping costs. The difference in the 2024H1 average exchange rate was small compared to the same period. By category, the gross margin of 2024H1 charging and energy storage/smart innovation/smart video was -0.42/+3.27/+4.91 pct year-on-year, respectively. On the cost side, the cost rates for the 2024Q1/2024Q2 period were 35.17%/33.44%, respectively, +0.76/+0.16pct, respectively. Among them, 2024Q2 sales/management/R&D/finance expenses were 21.56%/4.01%/8.12%/-0.25%, respectively, +0.06/+1.13/-0.51pct, respectively. The overall cost rate remained stable. Under the combined influence, net interest rates due to mother in 2024Q1/2024Q2 were 7.1%/10.65%, respectively, -1.99/ -3.24pct year on year; net interest rates without return to mother were 7.21%/8.54%, respectively, and -0.06/+0.43pct year on year, respectively.

Risk warning: Overseas consumer demand is falling rapidly; shipping prices are rebounding; new product expansion falls short of expectations, etc.