China Unicom (Hong Kong) Limited

Investors, analysts, media friends, ladies and gentlemen, good afternoon. I am Wang Lingshen, board secretary of China Unicom. Welcome to China Unicom's 2025 interim results presentation. Thank you very much for your long term interest and support for the company. Hon Chuen-hsiu-sheng Executive Director and President Mr. Jianqin Executive Director Mr. Tang Yong Guo Mr. Dong Chun Head of Discipline and also Supervisors Executive Director and CFO Mr. Li Yu Huo Senior Vice President Mr. Wang Li Min Senior Vice President Mr. Hao Li Qian Senior Vice President Mr. Miao Shouye Senior Vice President and Chief Legal Advisor, Mr. Zhou Hanwen. According to the agenda, we will first invite Chairman Chen to present the 2025 interim results and then there will be an interaction section with participants. This event will be conducted in Chinese with English simultaneous interpretation. Now I will invite Chairman Chen to present the interim results. Honourable investors, analysts, media friends, ladies and gentlemen, welcome to China Unicom's 2025 interim results presentation. In the first half of the year, the company seized strategic opportunities Effectively addressed challenges and comprehensively advanced integrated innovation to cultivate and strengthen new quality productive forces. Business development maintained a positive momentum with foundation for high quality development becoming more solid, momentum stronger and quality improved. Operating results have shown steady growth. In the first half, revenue scale remained stable with a slight increase. Operating revenue exceeded $200 billion. Representing a year-on-year increase of 1.5%, profitability continued to strengthen with total profit reaching $17.7 billion, up 5.2% year-on-year. Business structure continued to optimize. In the first half of the year, CC revenue reached $131.9 billion, CDSA revenue reached $45.4 billion RMB, Thank you very much. CC Business made steady progress. Thank you very much. First, actively expanding subscriber base. The company is continuously driving network and product upgrades, striving to create new momentum and advantages through faster connectivity, better communication and superior products. In the first half of the year, number of connected subscribers exceeded 1.2 billion, with a net increase of over 11 million mobile and broadband subscribers, a new high for the same period in recent years. The President Second, effective enhancements of subscriber value. Customer value is the fundamental source of the company's operational value. The company is fully committed to stabilizing existing customers, expanding new customers, tapping potential and enhancing value, deepening integrated development, introducing new business elements, adding new service content, and expanding new value spaces. China Unicom Smart Home has gained widespread recognition and Unicom WarPi has been well received. Over 50% of our users have chosen dual gigabit services with services such as Unicom Ultra HD, Unicom Home Surveillance, Cloud Intelligent Smartphones and Smart Home Robot reaching 270 million users. Penetration rate of integrated services exceeds 77%, and average price per user exceeds 100 RMB. Third, enhancing service quality, focusing on network craftsmanship, business reliability, channel convenience, and care and warmth. We have enhanced customer service quality. We have revamped over 10,000 stores, further expanding product categories, optimizing services, and improving efficiency. China Unicom APP Customer satisfaction continues to improve and brand influence is further enhanced. Second, CDSA business delivered enhanced quality. In the first half of the year, our CDSA business achieved both qualitative and quantitative growth. This is mainly reflected in the following three areas. First, strong momentum in computing power business. Unicom Cloud was upgraded and renewed, strengthening the integration of computing, intelligence, and cloud and networks. Intelligent Transformation of Data Centres has yielded significant results, with more internet platform companies and financial institutions such as banks moving into IT, China UNICOM's data centers. Revenue reached 14.4 billion RMB, a year-on-year increase of 9.4%, while AIDC contract value signed grew by 60% year-on-year, further solidifying our company's market position. Second, accelerated growth of intelligence services. Deepening the integration and innovation of data and intelligence, constructing high-quality data sets from multiple sources, developing multimodal coexistence of Uni-AI large models, and opening the Uni-AI Wanwu Intelligent Entity Development Platform, the scaled commercial application of AI in key areas such as industrial manufacturing, economic operations, urban governance, and healthcare. has begun to show results. Over 30 trusted data spaces have been established and over 100 AI agents have been developed. Third, empowering industry-wide upgrade. Leverage the advantages of information networks and digital technology to serve the digital development of the economy, government affairs, culture, society and ecology and strive to become a digital service provider with a deeper understanding of the industry. The President of the United States of America Co-Founder, Co-Founder Co-Founder iterating digital management platforms for transport, environment, emergency response, public facilities and cultural venues, and assisted over 400 cities in enhancing innovative development. Third, international business acceleration expansion revitalized the international brand Unicom collaborated with over 600 global operators and 1,000 industry partners and integrated into the global innovation network and leveraged global innovation resources. We continuously enhanced our global development capabilities. We leveraged our global network and operational service advantages and provided intelligent network services to over 280 global cloud service providers, connected more than 400 data centres. We established five new overseas intelligent computing centers, further enhancing our international intelligent computing infrastructure. We have developed benchmark projects such as ASEAN Smart Manufacturing, Middle East Smart Warehousing, Africa Smart Mining and Europe Smart Ports, and offered efficient and convenient digital and intelligent services to global customers. Network Investment Precise and Efficient CAPEX The Simplified Network Initiative was implemented in an orderly manner, achieving annualized operational expense savings of nearly 1 billion RMB, with data center resource utilization exceeding 70%. By adhering to high standard construction and high efficiency operations and fully deepening collaboration and shared benefits, the company has achieved a more complete network layout, significantly enhanced network capabilities and a more secure network architecture. New upgrades in network capabilities. We are advancing the upgrades of mobile network from 5G to 5GA and broadband network from gigabit to terabit, achieving broader connectivity, faster speeds with wider uplink bandwidth, lower latency and more precise sensing. Mobile network population coverage exceeded 99%, with 5GA commercial deployment in over 330 cities. Broadband networks cover 570 million households and 106 cities will pilot 10 gigabit optical networks. Second, innovative supply of computing power network. We optimized the integrated layout of computing power infrastructure, built and operated 10,000 card intelligence computing centers in Shanghai, Ninggang, Hohot, Ningxia, Zhongwei, and Qinghai, Sanjiangyuan, and promoted integrated development of advanced computing power and green electricity. Data center capacity reserves have reached 2,650 megawatt with total intelligent computing capacity reaching 30 eflops. Co-Founder, Co-President The U.S. economy is growing by more than 200,000 kilometers in the 8 vertical 8 horizontal backbone optical cable network, further enhancing robustness and security of the global network. Capacity of international submarine cables has increased by 239 and construction of the Qingdao and Haikou international offices is progressing smoothly. Fifth, scientific and technological innovation capabilities continues to strengthen. We focus on key technologies such as next-generation Internet, big data, AI and cyber security. We are strengthening our layout in cutting-edge fields such as 6G, low-altitude intelligent internet, satellite internet, embodied intelligence and quantum technology. We further increased investment with R&D expenses growing by 16%. The President of the United States of America We optimised innovation systems, fully leveraged the roles of research institutions such as the National Engineering Research Centre, Institute of Data Science and Artificial Intelligence and Hong Kong Innovation Institute, and strived to build a high ground for science and technological innovation and industrial innovation. We actively fulfil our corporate ESG responsibilities. First, we adhered to green development. launching the China Unicom Carbon Neutral Green Action Plan or Carbon Search Green Action Plan. We deepened network energy conservation, operating 22 green data centers, strengthening computing power synergy, and building a green power intelligent computing integration demonstration park. Second, we fulfill our social responsibilities, deeply advancing universal telecommunication services, helping to bridge the digital divide, and providing warm-heart products for the elderly and disabled, benefiting over 5 million users. We leveraged our nationwide network advantages, and we efficiently coordinated flood prevention and emergency response efforts. Co-President Tsai Ing-wen Thank you very much. 1.112 RMB per 10 shares representing a year-on-year increase of 16%. In the future, we'll better balance current operations and long-term development to actively deliver better returns to our shareholders. 2025 marks a pivotal year for AI as it transitions from theory to practice and represents a critical juncture for the large-scale application of AI to deliver tangible results. On 19 July, we hosted the 2025 China Unicom Partner Conference under the theme of moving forward together, co-creating a new ecosystem of integration. We'll work more closely with our partners to promote integration and innovation across different technological fields, production factors, industry sectors and application scenarios, co-creating a new ecosystem of integration in AI infrastructure, technology and AI industries. Thank you very much. Thank you all.