When Yuncong technology, Shangtang technology, Kuangshi technology and Yitu technology were awarded the title of “AI (Artificial Intelligence) four dragons” by the market, they also became the most concerned stars in the spotlight of the industry.
on April 6, 4, the registration application of cloud from the technology innovation board for IPO was approved, which is only the last step away from listing at present, among the “Ai four dragons”, Shangtang Technology (HK: 00020) landed on the Hong Kong Stock Exchange at the end of last year; The IPO of Kuangshi technology innovation board was held in September last year, and then submitted for registration. At present, the audit status is suspended; The IPO path of Yitu technology’s science and Innovation Board ended on June 30 last year.
Zhou Xi, the founder of Yuncong technology, was once the deputy director of the Information Institute of Chongqing Research Institute of the Chinese Academy of Sciences and was selected into the “100 person plan” of the Chinese Academy of Sciences. In 2015, Zhou Xi established Yuncong technology. The initial artificial intelligence project was incubated from Chongqing Research Institute of Chinese Academy of Sciences, and many core technicians also came from the system of Chinese Academy of Sciences.
although the “debut configuration” is excellent, the road of cloud technology listing is not smooth
Red Star capital Bureau noted that as early as December 3, 2020, cloud’s IPO application from the science and technology innovation board was accepted by the Shanghai Stock Exchange, entered the inquiry state on December 31 of that year, and was passed on July 20, 2021. But until April 6 this year, the cloud technology IPO registration application was approved, which took 16 months.
At the financial report level, Yuncong technology is still in a state of continuous loss. From 2018 to 2020 and the first half of 2021, it lost 3.008 billion yuan in three and a half years
While the halo is gathering, the listing is “bumpy”. What is the current situation and future imagination of the upcoming cloud technology businessP align = “center” (I) p align = “center” split the cloud from the technology revenue structure p align = “center” AI is the main source of revenue
According to the prospectus of Yuncong technology, in fiscal 20182020, the company’s operating revenue was 484 million yuan, 807 million yuan and 755 million yuan respectively in 2018 and 2019, the growth rate of the company’s revenue was 650.2% and 66.8% respectively; In 2020, or affected by the epidemic, the company’s revenue decreased by 6.5% year-on-year
The latest financial report shows that in the first half of 2021, cloud technology achieved a revenue of 455 million yuan, a year-on-year increase of 105.7%, and the overall revenue recoveredP align = “center” source: prospectus, red star capital Bureau
From the perspective of cloud technology revenue structure, it is mainly composed of man-machine cooperative operating system and artificial intelligence solution at present, the AI solution business is the main revenue source of the company
According to the prospectus, from 2018 to 2020, the business income of cloud technology man-machine cooperative operating system was 31 million yuan, 183 million yuan and 237 million yuan respectively, accounting for 6.4%, 22.7% and 31.4% of the total revenue respectively. The revenue contribution of this business is increasing.
From 2018 to 2020, the business revenue of cloud technology artificial intelligence solutions was 452 million yuan, 597 million yuan and 515 million yuan respectively, accounting for 93.3%, 74.0% and 68.2% of the total revenue respectivelyP align = “center” source: prospectus, red star capital Bureau
Here is a brief explanation of the two main businesses of cloud technology.
The first is the man-machine cooperative operating system, which means that the company provides customers with self-developed basic operating system, application products, core components and technical services based on man-machine cooperative operating system. At present, the man-machine cooperative operating system independently developed by cloud technology includes four components: kernel, algorithm library, runtime and application framework. It has formed a complete operating system architecture and has the system foundation of connecting aiot devices downward and carrying applications upward.
In short, it is AI software authorization and technical services, which is similar to Arcsoft Corporation Limited(688088) authorizing algorithms and applications in the image field to chip manufacturers and smartphone terminal manufacturers. Cloud also authorizes the self-developed man-machine cooperative operating system to relevant customersP align = “center” source: prospectus
The second is the artificial intelligence solution, which refers to the intelligent upgrading solution provided by cloud technology to solve the business problems of customers in specific industries through the strong technical barriers in the field of face recognition and speech recognition.
Specifically, cloud technology is mainly based on the self-developed man-machine cooperative operating system and its application products and aiot hardware equipment, and provides comprehensive solutions for the four fields of smart finance, smart governance, smart travel and smart business.
Among them, the intelligent governance scenario is currently the most widely used. According to the prospectus, 20182020, the revenue of corporate smart governance accounted for 75.3%, 58.1% and 57.5% respectively. As of December 31, 2020, the company’s smart governance products and solutions have been put into police practice in 30 provincial administrative regions across the country
In addition, the smart finance scenario grew rapidly and gradually became the second largest core application scenario. From 2018 to 2020, the revenue of the company’s smart finance accounted for 10.9%, 18.9% and 23.9% respectively.
In addition to splitting the company’s revenue structure and comparing the business revenue trend, it is more important to compare the “money making” quality of various businesses.
First of all, from the perspective of gross profit margin of man-machine cooperative operating system, due to the high degree of standardization of this business, which mainly provides self-developed software of the company, the gross profit margin of this business is also relatively high. According to the prospectus, 20182020, the gross profit margin of the company’s man-machine cooperative operating system business was 75.6%, 89.3% and 75.9%
In terms of artificial intelligence solutions, since it mainly provides overall solutions for customers in various industries, it needs to purchase a large number of third-party software and hardware, and the hardware will also reduce the company’s gross profit margin, so the overall gross profit margin of the business is relatively low 20182020, the gross profit margin of the company’s artificial intelligence solutions business was 17.8%, 23.4% and 28.2% p align = “center” source: prospectus, red star capital Bureau
From 2018 to 2020, the overall gross profit margin of cloud technology was 21.7%, 40.9% and 43.5% respectively, showing a trend of steady progressP align = “center” (II) p align = “center” expense side: continuous loss, where is all the money spent
According to the prospectus, from 2018 to 2020, the net losses of Yuncong technology were RMB 200 million, RMB 1.763 billion and RMB 721 million respectively; In the first half of 2021, the net loss attributable to the owner of the parent company was 324 million yuan.
In the past three and a half years, cloud technology has lost a total of 3.008 billion yuan.
for the huge losses in 2019, Yuncong technology said that this was due to the implementation of equity incentive for the company’s executives and core employees in September 2019, and there were no restrictive terms such as service period or performance indicators
In accordance with the provisions of accounting standards, the company will record the services obtained into the current expenses at one time according to the fair value of equity instruments on the grant date. The share based payment expense recognized by the parent company of equity incentive this time is 1.275 billion yuan. According to the financial report data, the management expense rate of cloud technology increased significantly to 181.7% from 2019.
in addition to the huge administrative expenses, the sales expenses of Yuncong technology are also on the high side as a whole, and the sales expense rate shows an upward trend year by year 20182020, the company’s sales expense ratio was 26.6%, 28.3% and 36.3% respectively, which is also one of the main reasons for the loss of Yuncong technologyP align = “center” source: prospectus, red star capital Bureau
As a technology-based enterprise, huge R & D investment is also one of the important reasons for the loss of cloud technology
According to the prospectus, from 2018 to 2020, the R & D expenses of cloud technology were 150 million yuan, 450 million yuan and 580 million yuan respectively, accounting for 30.6%, 56.3% and 76.6% of the revenue of each period respectivelyP align = “center” source: prospectus, red star capital Bureau
In terms of the number and proportion of R & D personnel, from 2018 to 2020, the number of R & D personnel of cloud technology was 465, 824 and 997 respectively; The company has set up artificial intelligence R & D teams in core cities such as Guangzhou, Chongqing, Shanghai, Suzhou and Chengdu, with R & D personnel accounting for 51.1%, 49.6% and 55.4% respectively.
To sum up, under the three mountains of sales, management and R & D, Yuncong technology has not yet achieved profitability. In addition, according to the latest financial data, the revenue of Yuncong technology in the first half of 2021 was 455 million yuan, and the net profit attributable to the owner of the parent company was – 324 million yuan. Compared with the net profit of – 286 million yuan in the same period of the previous year, this dimension directly increased the loss surface by 13.1%.
However, in this regard, cloud technology does not seem to “panic”. According to Yuncong technology, through the calculation of profitability, the current business plan, on-hand orders and relevant conditions are the conditions for turning losses into profits, and preset the time node for turning losses into profits in 2025 in the report p align = “center” (III) p align = “center” will be launched soon, and the cloud will start from the worries and difficulties of Technology
From the perspective of the overall environment, AI enterprises in China and even around the world are not doing well.
According to the EU billion report, in 2018, nearly 90% of AI enterprises were in a state of loss, and the other 10% assisted traditional industry giants, playing the role of technology providers and barely maintaining food and clothing.
Objectively speaking, compared with the other two companies of the “Ai four dragons”, cloud technology still loses less
According to the financial report of Shangtang technology, the company lost 17.17 billion yuan in 2021, an increase of 41.3% compared with 12.15 billion yuan in 2020. The adjusted loss of the company was 1.418 billion yuan, an increase of 61.5% compared with the loss of 878 million yuan in 2020.
According to the prospectus of Kuangshi technology, from 2018 to 2020, the net losses of Kuangshi technology were 2.8 billion yuan, 6.643 billion yuan and 3.326 billion yuan respectively, and the net losses after deduction were 565 million yuan, 1.249 billion yuan and 1.547 billion yuan respectively. In the first half of 2021, Kuangshi technology had a net loss of 1.858 billion yuan and a net loss of 929 million yuan after deduction.
Of course, compared with the company’s revenue scale and R & D investment, cloud technology also has a certain gap with the above two enterprises.
for AI enterprises, one side is the bottomless R & D investment, and the other side is the R & D achievements that need to be competed. This imitation Buddha is the two ends of the balance, pulling these AI enterprises
This is not a small pressure for today’s cloud technology. On the one hand, cloud technology needs to face the competition of native AI enterprises, such as giants such as Shangtang technology, Kuangshi technology and Yitu technology, including not only the competition of core algorithm technical strength, but also the competition of artificial intelligence applications and industry solutions. However, at present, cloud technology as a whole is in a “not high or not low” position and does not show unique advantages.
On the other hand, cloud technology also faces competitive risks such as Internet giants competing for AI field and traditional industry manufacturers transforming AI
The layout of major Internet manufacturers such as Huawei, Alibaba, Tencent and Baidu has refreshed the competition pattern of AI industry. They not only have the hard strength in terms of flow and finance, but also have rich enterprise management experience. Once the Internet giants gradually rise and gain a firm foothold, the four dragons such as cloud technology will face greater pressure.
In addition, Hangzhou Hikvision Digital Technology Co.Ltd(002415) ( Hangzhou Hikvision Digital Technology Co.Ltd(002415) . SZ), Zhejiang Dahua Technology Co.Ltd(002236) ( Zhejiang Dahua Technology Co.Ltd(002236) . SZ) and other manufacturers have deep accumulation in hardware and supply chain, and their participation continues to add weight to the fierce competition.
Therefore, whether for cloud technology or the whole AI industry, there are still too many uncertainties in the future, and the industry will continue to shuffleP align = “center” summary
Generally speaking, the real spring of AI industry at this stage has not yet come. Today, the scattered actual landing scenes, low product standardization and high labor costs have led these AI giants to fail to find a sustainable profit path.
However, capital pays attention to profit first, and the market has never stopped questioning the valuation and profitability of the “Ai four dragons”. Listing is only the first step from cloud technology, and there are still many tough battles to fight.
