In the first half of 2024, the Company faced serious challenges, the external business environment continued to show complexity and uncertainty, and the investment budgets of corporate customers across industries generally showed a tightening trend. In particular, the slowdown in the growth rate of the telecommunications industry, investment cycle staying at trough and the sudden increase in the effort on cost reduction by telecom operators resulted in marked pressure on the Company's order prices, increased difficulty in business negotiation, and significant delays of orders, which created a relatively considerable impact on the Company's BSS and other traditional businesses, leading to significant pressure on the interim results. The operating revenue amounted to RMB2,994 million, representing a year-on-year decrease of 8.8%, of which the revenue from BSS and other traditional businesses amounted to RMB1,794 million, representing a year-on-year decrease of 18.1%. The Three New Business^[1]maintained a double-digit growth, with revenue amounted to RMB1,200 million, representing a year-on-year increase of 10.0%. As a result of a relatively large decline in operating revenue, there was a net loss of RMB70 million during the Period.

In terms of new business, the Company attached greater importance to the high-quality development of the business and strengthened risk control in the process, resulting in a slower pace of business development and revenue growth. Similarly, due to various factors such as slowdown of the growth in the telecommunications industry, being in the trough of the industry investment cycle and steep increase in cost compression by telecom operators, revenue from the OSS business experienced a slight year-on-year decline of 1.6% to RMB280 million in the first half of the year. Revenue from the digital intelligence-driven operation business steadily improved and registered revenue of RMB447 million, representing a slight year-on-year decrease of 1.9%. Meanwhile, the Company continued to progress in the vertical industries digitialisation market and enhanced the expansion efforts in key areas such as energy, transportation and government affairs, maintaining a relatively fast growth and achieving a year-on-year increase of 34.6% in revenue to RMB473 million.

The Board attaches great importance to shareholders' interests and return and guided the final dividend payout ratio for 2024 to maintain at 40% of the profit for the year attributable to the equity holders of the Company, while actively consider maintaining the amount of the final dividend per share at a relatively stable level as compared to that of last year.

It is expected that the Company will achieve a performance rebound in the second half of the year, with full effort to achieve better full year profit than last year. The Company will accelerate the process of business negotiation of BSS orders to mitigate the impact of order prices pressure and signing delays. At the same time, the Company will seize technological upgrade opportunities brought by "AI+" and "LLM+", etc., actively participate in joint R&D with customers, and ensure the leading position of the BSS business in the telecommunications industry. It is expected that the rate of decline in BSS business revenue will be notably narrowed for the full year.

In terms of the Three New Business, the full year revenue is expected to maintain decent growth. The Company will accelerate the promotion and replication of digital intelligence-driven operation business, expand the scale of result-based and commission-based models, and strengthen collaboration with telecom operators in government and corporate business, and international business expansion to strive for a larger share of these cooperation opportunities and expand revenue scale. Additionally, the Company will continue to deepen its efforts in key industries such as energy, transportation, and government affairs, achieving continuous high-quality growth in non-telecommunications market businesses. While promoting revenue trend improvement, the Company will further step up cost control efforts in the second half of the year by rigorously controlling staff scale, strengthening process management of labour costs linked to performance, and reasonably allocate resources. The Company will expand centralised procurement and one-stop business expense platforms to effectively control daily costs and expenditures, striving to achieve full year profit exceeding that of last year.

The Company considers that telecommunications industry remains a high-quality industry. As long as we continue to build on our technological leadership, seize new technology upgrade opportunities brought by "AI+" and "LLM+", and actively participate in joint R&D with telecom operators, we can maintain our leading position in the traditional business and seize the high-quality development on the Three New Business, seeking growth through challenges. Meanwhile, the Company will actively apply new technologies like AI to improve the automatisation level of R&D and delivery process, enhance production efficiency, reduce costs, and boost efficiency. The Company believes after a short- hit on results, the fundamentals for the Company's long-term development remain solid, and its revenue and profit will maintain a stable and healthy momentum.

Hashtag: #AsiaInfoTechnologies

The issuer is solely responsible for the content of this announcement.