Main revenue rose slightly, and net profit fell sharply in the first three quarters of 2006. In the first three quarters of 2006, the company achieved a total main business revenue of 3905.985 million yuan, an increase of 28.25% over the same period last year, and operating profit of 7.8793 million yuan. Net profit was 4.906 million yuan, down 84.27% from the same period last year. In the case of an increase in main business revenue, an increase in main operating costs and a sharp increase in management expenses was the main reason for the sharp decline in net profit. The company maintained profits by receiving subsidies and investing in revenue from Inspur Digital Mobile Communications Co., Ltd. Profitability continued to decline sharply since the first half of 2005, and the company's main gross margin and net sales margin both began to decline. This trend was maintained in the first three quarters of 2006, and there were signs of an accelerated decline. Due to the high gross margin of software products, if the company successfully transforms into a product software supplier, the main gross margin will increase further. Until then, the gross margin had already shown a continuous downward trend, so it is more likely that the company's profitability will continue to decline in 2006 or more. Operating efficiency has improved, and cash flow has improved in the first three quarters of 2006. The accounts receivable turnover ratio and inventory turnover ratio rebounded year-on-year in the first three quarters, and the operating cash flow per share rose from -0.362 yuan in the first three quarters of 2005 to 0.053 yuan. Whether these indicators can continue to improve remains to be seen. The profit forecast was lowered, and the holding rating was lowered to the profit forecast for 2006, 2007, and 2008. Through comprehensive comparison with companies in the same industry, the company's stock price is currently not undervalued, so the holding rating is maintained.