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Annual Net Profit Increased By Nearly 70%, And Quarterly Loss Turned Around: Iflytek Embraces AI 2.0 Bonus Period

2021/4/22 9:02:00 0

YearNet ProfitQuarterAI

The bonus of artificial intelligence continues to be paid, and iFLYTEK's performance in 2020 will usher in comprehensive growth.

On April 20, iFLYTEK (002230. SZ) released financial reports for the whole year of 2020 and the first quarter of 2021. According to the financial report, iFLYTEK's annual revenue in 2020 will exceed 13 billion yuan, an increase of 29.23% over the same period last year; The gross profit was 5.876 billion yuan, an increase of 26.69% over the same period last year; The net profit attributable to the shareholders of the listed company was 1.364 billion yuan, up 66.48% over the same period last year; The net cash flow from operating activities was 2.271 billion yuan, a record high.

The data for the first quarter were also optimistic. According to the financial report, iFLYTEK's revenue exceeded 2.501 billion yuan, up 77.55% year on year; Compared with the loss of 131 million yuan in the same period of last year, the net profit attributable to shareholders of listed companies turned losses into profits.

"2020 is the key year for iFLYTEK and the era of artificial intelligence 2.0," Wu Xiaoru, President of iFLYTEK, pointed out on April 20, at the performance presentation meeting after the release of financial reports. "After entering the stage of AI 2.0, iFLYTEK's overall product dividend began to show continuously through large-scale product promotion and in-depth application value, IFLYTEK's profitability has also reached a high level. "

Around the brilliant performance of iFLYTEK, many securities companies and investment banks also gave positive comments. "We believe that 2020 is the first year of iFLYTEK's development towards the era of artificial intelligence strategy 2.0. The company's core track has developed well. Under the impact of the new crown epidemic, the track of education, medical treatment and open platform still maintain a high growth rate of more than 50%, reflecting the development trend of the company towards large-scale commercial use." Hua An Securities research team commented.

IFLYTEK

Key year of AI 2.0

In 2019, iFLYTEK proposed to enter AI 2.0 from AI 1.0, and its performance in 2020 is precisely the high growth of core track brought by AI 2.0 bonus period.

Specifically, in 2020, iFLYTEK's open platform achieved revenue of 1.921 billion yuan, with a year-on-year growth of 66.42%. By the end of the report period, iFLYTEK open platform has opened 396 AI capabilities and solutions to the outside world, gathering more than 1.756 million developer teams, and the number of developers has increased by 56.79% compared with the same period in 2019.

According to AI media consulting's special research report on China's artificial intelligence industry in the first half of 2020, iFLYTEK's comprehensive strength occupies the first echelon in the intelligent voice track. Under the background of the high base number of developers in the past, iFLYTEK open platform can also achieve a rapid growth in the number of developers in 2020, which also reflects its attraction to developers and its ability of ecological construction.

In 2020, the total revenue of iFLYTEK education track is 4.187 billion yuan, with a year-on-year increase of 67.59%. Among them, the income of educational products and services is 4.019 billion yuan, with a year-on-year growth of 70.68%. The proportion of education track in total income increased to 32.14%.

By the end of December 2020, iFLYTEK smart classroom products have covered 34 provinces and more than 30000 schools, serving more than 850000 teachers and 1.2 million students, helping teachers teach more than 9 million times and preparing more than 18 million times. The average time of preparing lessons for teachers is reduced by 56%, the average time for correcting homework is reduced by 45%, and the classroom efficiency is improved by 28%.

The revenue of medical racetrack was 313 million yuan, with a year-on-year increase of 69.25%, reflecting the explosive growth of this revenue. According to the financial report, in 2020, iFLYTEK intelligent medical assistant will fully cover primary medical institutions in Anhui Province, and gradually begin to implement application in Tibet, Inner Mongolia, Qinghai, Beijing, Xinjiang, Heilongjiang, Zhejiang and other places. At present, it has launched more than 30000 basic medical institutions in more than 170 districts and counties across the country, serving tens of thousands of grassroots doctors.

In terms of intelligent hardware, iFLYTEK will achieve revenue of 873 million yuan in 2020, with a year-on-year increase of 8.99%. During the reporting period, based on iFLYTEK recording pen, iFLYTEK office book, iFLYTEK translator and other "Ai + hardware" new categories, the company continuously updated products, further expanded the application scenarios and user group coverage, enriched product categories, launched scanning translation pens, intelligent readers and other products, using the international leading artificial intelligence core technology and application effect, Further expand the company's layout for C-end consumption.

Wu Xiaoru said that in 2020, iFLYTEK will achieve multi-point blossom in all important tracks and make a series of application progress. Behind this, iFLYTEK is not only the technical support of iFLYTEK, but also the continuous breakthrough of iFLYTEK in the market. At the same time, iFLYTEK has constructed a huge innovation ecology and industrial ecology, so as to provide integrated solutions in the industry track.

"We believe that in the era of artificial intelligence 2.0, iFLYTEK has moved from the early stage of technical exploration to the scale of commercial advantage track. In the future, iFLYTEK is expected to continue to improve the operation quality, so as to realize the performance release at the profit side." Hua An Securities research team said.

Endogenous growth

In February this year, iFLYTEK proposed that the goals for the next five years are to reach 1 billion users, achieve 100 billion revenue, and drive trillion industrial ecology.

According to Liu Qingfeng, chairman of iFLYTEK, the main driving force for iFLYTEK's future growth is the endogenous growth of the company's main tracks. It is estimated that about one third of iFLYTEK's revenue of 100 billion yuan in the future will come from education business, one third from digital economic transformation such as medical treatment and e-government, and one third from consumer products.

It should be noted that the "tob to TOC" two wheel drive business model of iFLYTEK education track has gradually run through.

At the B end, iFLYTEK has successively won several orders of more than 100 million yuan this year. In January and February 2021, iFLYTEK won the smart education projects in Jinshui District of Zhengzhou City and Yijiang District of Wuhu City with the bid winning amount of 688 million yuan and 126 million yuan respectively. This shows that iFLYTEK's products and solutions have begun to be verified in terms of reproducibility. In the future, it is expected to move from Anhui to the national market, with considerable growth potential behind it.

On the consumer side, iFLYTEK's personalized learning manual and learning machine products have also begun to attract attention. According to the introduction, the personalized learning manual relies on artificial intelligence and big data technology to analyze the daily study of each student, accurately locate weak knowledge points, and make each student's average homework duration of about 40 minutes, the average correct answer rate of more than 75%, and the error solving rate of more than 90%.

IFLYTEK intelligent learning machine will release 3 products in 2020, with a total of 54 upgraded versions. Since the launch of iFLYTEK intelligent learning machine x2 pro on July 22, it has accurately helped students find 13.255 million weak knowledge points, and through personalized learning and practice, the solution rate of weak knowledge points reached 74.9%.

Liu Qingfeng believes that in the context of quality education, it is the future trend to use scientific and technological innovation such as artificial intelligence to reduce the burden on teachers and students and teach students in accordance with their aptitude. In this context, iFLYTEK's leading position and brand leading position in the field of education will be further enhanced.

In addition to the education track, Liu Qingfeng pointed out that under the current wave of digital transformation, iFLYTEK has formed a good demonstration effect and advantages in the fields of digital life, including medical care and digital government affairs.

In addition, iFLYTEK is also constantly changing its array to adapt to the new digital economic development trend. In 2020, iFLYTEK will adjust its organizational structure, merge political and legal BG and smart city BG to establish a new smart city BG.

IFLYTEK explained that smart city business and smart politics and law business are highly complementary in terms of national market, A.I. understanding and development, comprehensive solutions, and large project operation. The merger is also to give full play to their advantages in business collaboration, capability complementarity and talent integration, so as to meet new strategic opportunities.

At the same time, Suntech will separate the operator business in the consumer BG and establish the operator Bu, so as to focus the intelligent service Bu on the financial track. A series of structural adjustments also reflect that iFLYTEK's business is further focused on the core track, and its future development strategy is also clearer.

"We believe that 2b-2c's closed-loop business model not only provides the company with the momentum of sustained growth in the field of education, but also hopes to further expand into other advantageous tracks, such as medical and other fields, so as to create multiple new growth poles for the company." The research team of Hua'an Securities said, "therefore, we believe that iFLYTEK, relying on artificial intelligence technology, data accumulation in professional fields and scene landing ability, is expected to run through the business model of scale landing in each advantageous track, so as to open up the space for upward development."

 

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