Event: 2024H1: Achieved revenue of 9.648 billion, +36.55% YoY, net profit to mother of 0.872 billion, +6.36% YoY, net profit of 0.766 billion, +40.53% YoY. 2024Q2: Achieved revenue of 5.271 billion, +42.43% YoY, net profit to mother 0.561 billion, +9.19% YoY, net profit 0.45 billion, +49.89% YoY.

Revenue growth is accelerating, and core categories are improving. The company's Q2 revenue growth rate reached 42%, up from Q1. By business, 24H1 charging, innovation, and wireless audio business revenue was +42.8%/+35.3%/+30.8% year-on-year respectively. The three major businesses all launched innovative new products with market competitiveness in 24H1. Among them, the charging business showed outstanding performance. The Anker SOLIX Solarbank 2nd generation Pro and Plus, launched in May, introduced the industry's first integrated design, supporting up to 2,400 W of photovoltaic input and 9.6 kWh of modular expansion, and achieved accurate power supply with smart meters to minimize energy waste, maximize user benefits, and accurately target user pain points.

The refined operation of online channels has doubled the revenue of independent sites. On the channel side, 24H1 Amazon/other online channel/independent website revenue was +27.7%/+67.4%/+102.9%, respectively. The company has continued to strengthen the construction of independent stations in recent years. The 24H1 independent station achieved revenue of 0.925 billion, accounting for 9.6% of total revenue, +3.1 pct compared to the previous year.

The independent station D2C model helps the company to better interact with users and more comprehensively display the complex categories launched by the company to achieve sales.

Gross margin bucked the trend. 24H1's gross margin increased 2.0pct year-on-year to 45.2%. Despite rising sea freight rates in Q2, it still achieved contrarian growth. We believe it is mainly due to the company's insistence on the path of innovation, and 24H1 has successively launched complex single products with high gross margins in various categories, which has led to overall gross margin growth. The 24H1 sales, management, R&D, and finance expense ratios of the fee-side company were 21.9%/4.1%/8.3%/-0.1%, respectively, +0.6pct/+1.1pct/-0.2pct/-1.1pct, respectively. The overall cost ratio was properly controlled. Under the combined influence, the company's 24H1 net profit margin -2.6pct year-on-year to 9.0%.

As a leader in cross-border e-commerce with a global layout, Anke has the advantage of successfully building a perfect channel system and high brand barriers, and gradually developing into a platform-based company that has established core capabilities and quickly replicated successful experiences. We are optimistic that the company will seize the opportunity to go overseas and achieve great development. As the results of the mid-year report exceeded expectations, we increased net profit to mother for 24-26 by 1.99/2.42/2.96 billion yuan (previous value was 1.895/2.257/2.606 billion yuan), and the corresponding PE was 16.7x/13.7x/11.2x.

Risk warning: the risk of rising raw material prices; private brand growth falling short of expectations; overseas market expansion falling short of expectations; market demand falling short of expectations due to changes in the macroeconomic environment, etc.