Easou Technology (2550) H1 2025 earnings summary

Executive summary

• H1 2025 revenue rose 37.6% YoY to RMB382.3m; profit for the period increased to RMB10.3m from RMB3.4m, with growth led by digital marketing and online reading.

• Strategic priorities include AI recommendation and AIGC, overseas short dramas and games, and expansion into Web3.0 and RWA.

Financial highlights

• Gross profit rose 30.3% to RMB149.5m; gross margin eased to 39.1% from 41.3% as lower-margin digital marketing gained revenue share.

• Profit before tax was RMB11.6m versus RMB5.2m; basic and diluted EPS was RMB3.16 cents versus RMB1.07 cents, with no dilution adjustment required.

• Selling and distribution expenses rose 53.9% to RMB105.9m, driven by overseas reading and short-drama promotion; administrative expenses fell 63.8% to RMB8.4m, mainly due to no listing expenses.

• R&D expenses increased 26.9% to RMB22.3m, mainly on server, bandwidth and employee costs.

Outlook and guidance

• H2 priorities include upgrading AI recommendation accuracy, expanding AIGC applications, and developing reading, digital marketing, games, Web3.0 and RWA activities.

• Short-drama plans include localizing Chinese content and producing regional originals, initially targeting Europe and America before further expansion.

• At least five games are expected to launch overseas in 2025; two completed testing and entered trial operation in H1.

• Premium games are being prepared for overseas publishing; July subscription proceeds are intended for data center assets (50%), AI/Web3.0/RWA or digital content investments (30%), and working capital (20%).