On November 15, Caixin reported (Reporter Fu Jing) that Dawning Information Industry (603019.SH), which specializes in the research and manufacturing of high-end computers, storage, security, and data center products, has been on the rise in recent years. During the earnings conference held this afternoon, an investor even asked: "Can you become the Nvidia of China?"

"The company is striving to catch up with advanced overseas products in areas such as data center storage, liquid cooling, and networking. In the chip field, the joint venture enterprise Haiguang Information (688041.SH) continues to upgrade and iterate," said Dawning Information Industry President Li Jun in response.

Caixin journalists noticed that despite the continuous growth in high-performance computing and data center demand, Dawning Information Industry admitted at the earnings conference that the competition for computing power is intensifying.

The company's Chief Financial Officer and Board Secretary Weng Qinan told Caixin journalists that the computing power industry chain includes multiple links such as upstream chips, servers and infrastructure, software stacks, and services. Currently, there is a wide array of domestic computing power manufacturers, with new participants emerging. Despite the intensified competition, faced with the growing domestic demand for computing power and the demand for domestic substitution, the market space continues to expand.

Li Jun stated, "The company operates in a highly competitive industry and has a certain ability in negotiating prices with suppliers and setting prices for customers, while also facing certain restrictions. The company's main business has a high technological barrier, and it has a strong advantage in potential competitors entering and substitutability of alternative products."

However, looking at the financial data, in the first three quarters of this year, Dawning Information Industry's revenue and net income attributable to the parent company increased by 3.65% and 2.57% year-on-year, respectively. In fact, since Q1 of this year, the trend of double-digit year-on-year growth in net income for each quarter over the past four years has not continued.

During the earnings conference, several investors compared Dawning Information Industry with its counterpart Inspur Electronic Information Industry (000977.SZ) in terms of performance (revenue and net profit growth in the first three quarters increased by 72.26% and 67.05% year-on-year, respectively), with some investors even questioning: "Inspur Electronic Information's performance in the first three quarters has been growing rapidly, similarly engaged in servers, why is our company not making progress?"

In response, Li Jun stated that the growth of income is influenced by various factors such as market demand and business planning of each business sector.

It is also worth noting that Dawning Information Industry once disclosed in the semi-annual report that the company is constructing a "national integrated computing power service platform," investing 0.283 billion yuan in the first half of the year in Shanxi computing power network hub node construction and operation limited company jointly with partners. As a result, Dawning Information Industry's external investment in the first half of the year increased by as much as 407.43%.

However, when asked about the progress in this area at the earnings conference, Li Jun only mentioned that Dawning Information Industry has been involved in the construction of related computing power centers in recent years. Through a self-developed integrated computing power service platform, it has achieved resource integration in computing power centers, to some extent addressing issues of resource isolation and uneven computing power distribution.

In recent years, the company has expanded its layout to the computing ecosystem business, investing in multiple assets such as Haiguang Information, Geovis Technology Co., Ltd. (688568.SH), and Shuguang Digital Creativity (872808.BJ). Dawning Information Industry's invested enterprises have also attracted market attention. Haiguang Information has increased its technology research and development investment around the general computing market, with market demand driving its year-on-year revenue and net profit attributable to shareholders increasing by 55.64% and 69.22% respectively in the first three quarters; Geovis Technology has been deploying in the low-altitude economy sector since 2020, with early-stage capabilities in low-altitude navigation products and projects established.

In June 2019, Dawning Information Industry, Tianjin Haiguang, Chengdu Haiguang Integrated Circuit, and Chengdu Haiguang Microelectronics Technology were once listed by the US Department of Commerce in the Entity List. Li Jun stated that the company is closely monitoring relevant external information that may affect the industry chain, such as overseas intensifying sanctions on China's technology industry, and the company will actively respond and strive to minimize the potential impacts.

It is worth mentioning that although many investors inquired about the current order situation and the company's expectations for full-year performance, Dawning Information Industry did not provide a positive response. However, in the past few years, Dawning Information Industry has recognized more revenue in Q4. The financial union reporters will continue to monitor how the company's performance unfolds throughout the year.