NetDragon Websoft Holdings Limited

Thank you for joining NetDragon Websoft Holdings Limited 2026 Interim Results Presentation. 各位投资界的朋友,早安! 欢迎各位参加网龙网络有限公司2026年中期演习发布会。 Before we start, please allow me to introduce the management who are joining us today. 首先,请到我为大家介绍今天的主席的代理人。 我们有Dr. Simon Leung, Group Vice Chairman and Executive Director. Liang Nianjian, Group Vice President and Executive Director Mr. Woodlau, Group Interim CFO Mr. Lin Chen, Group Senior Vice President Now, let's pass our time to Dr. Simon Leung to hold our presentation.

Okay, thank you. Good morning, good afternoon, good night, or whatever. So thank you for joining us today. Let me kind of, well, I'm not going to go through the agenda, because it's actually, you guys probably very familiar with the agenda. So what I'll do is actually I'll hit the highlights of our half-year results, and then I'll hand it over to Wood, and then we'll also go into the business. Good news is actually on the gaming side, We deliver growth half over half, which is actually very good news for us. It shows the resilience of our flagship IP, which is actually really good news. The second big one is actually something we discussed much earlier, but I think we are kind of wrapping it up as a product, which is the AI Workforce OS, which I will talk about a little bit. The cost reduction and in turn support the growth of our gaming business and also the education business going forward. Again, Lin Chen and I will talk about how to support our business going forward. Last but not least in gaming is actually AI continue to help not only on the cost side but also on the growth side. For mine, in education business in the US and In Europe, we're still facing a lot of headwinds because of domestic issues in the U.S., the two wars in both Ukraine and Iran. So it's actually facing a headwind. We successfully leveled our loss, our growth in global detail later on. Another milestone that we had is actually we delivered our latest product, which is AP10 for the premium market. and also the APLE to address the value market. The AP10 premium is actually quite critical because the support is at the third point I want to mention. The good news on SaaS is that we have grown our business year over year. This is going to be our future. When hardware gets commoditized, SaaS revenue is very important. The AP10 is actually designed to support all the SaaS businesses and so on, including deploying AI on our panel, which I will talk a little bit more about.

So with that, I'm going to turn it over to Wood to talk about the results. Thank you, Simon. Good morning, everyone. And I will walk you through the financial highlights for the first half of the 2026. And for the revenue, the total revenue of the group is $2.1 billion for the first half of 2026, which is done from 27% year-over-year. And for seven gaming and application services, the revenue was 1.6 billion, which is down about 5% YOY. But, you know, despite the YOY decline, we have seen a significant signal of stabilizing and recovery of all with a half-over-half growth by 3% for this half over the second half of the last year. And for Mind.ai, revenue was about $505 million, which due to the delayed pace of the industry-wide demand recovery. And for the constant exchange rate, the decrease was a little bit lower to about 70%. Goals project is about $1.5 billion, which is broadly in line with the revenue trend. And the core side, we continue to execute an AI strategy and the overall op-ed decreased about 80% to about 1.1 billion. And for B major op-ed and selling and marketing expenses decreased about 15% worldwide to about 213 million. And for the administrative expense decreased about 12% to about 416 million, reflecting our continuous effort to deploy AI applications. to enhance our internal strategy and internal efficiency. R&D expenses increased about 34% to about $409 million, which is mainly due to the operational deployment of our AI and 4E metrics, which support structural transformation and efficient games. As a result, our profit attributable to owner of the company was about $56 million. It increased 20% in six years. And I would like to draw your attention on the two major items here. First, we made an EDVN impairment provision for the first half about RMB 113 million, which reflects the EDVN price hit a multi-year low at around USD 100, 1,600 in the excess of our original N, which the EDVN price already covered a bit as of now. and secondly, the run-off service payment was decreased about 42% to about 86 million yuan a week, which indicates our operational structure is gradually reaching a new normal. Excluding these two factors, adjusted profit attributable to our owner of the company was about 254 million, which is down about 8% year-on-year, which is very stable given the market situation. Finally, our board has declared an interim dividend of about HKD 0.5 per share, which changed from last year, reflecting our commitment to our shareholders' return plan announced last March this year. Turning to the next page is our segmental financial highlights. And starting with programming and application services, and the revenue was about 1.6 billion USD year-on-year. Gold's profit is about 1.3 billion, which stands at about 12% this year, which with a gold profit margin is over 80%. And our core segmental profit was about 461 million, which is still a little bit lower compared with the same period last year. But, you know, age over age, the core segmental profit has already improved a The segmental operating expenses was reduced across key fee categories. For our R&D, the decrease is about 23%, and for the savings expenses, decrease is about 9%, and the administrative expenses is about 5%. Overall, the operating expenses for the gaming segment is down about 40%. As of the cost-saving impact, our AI strategy continued to 15%. Importantly, our core segmental profit improved half over half. are our business stabilizations and the operations pieces. Moving to the my.ai revenue is about $505 million, which stands about 21%, which mainly driven by a lower customer standing as, you know, the delayed time demand. Our fourth product was about $114 million, which stands only 40%, which have a The cost margin improved because of our cost savings charge. And our cost at mental losses level 2, about $126 million, which is down from the $195 million in the last year. The improvement was mainly supported by our continued cost reduction. R&D expenses is down about 27%. Marketing expenses is down about 25%. Administrative expenses is down about 56%. and overall the mind's operating expenses is down about 29% worldwide as we continue to optimize our cost structure while waiting for other industry demand recovery. So to conclude, although the top nine goals was under pressure in the first half, we made a solid progress in our cost control a bit under the AI strategy. So these actions help us to improve our operation efficiencies Hello everyone, I am very happy to introduce the performance of NetDragon Games in the first half of the year.

First of all, we have achieved better results in the first half of the year in terms of revenue and development. First of all, we have made a significant growth in terms of revenue. From the trend point of view, we have also ensured that Dejian Liu, Lau Hak Kin, Lin Wei will also contribute to future income stability and recovery growth. In the future, you will also see that in terms of cost, especially in terms of cost of development, through the deepening of AI, our cost of development and our efficiency of development are actually constantly improving. From the cost of development, we can also see this trend very well. Okay, next page. Next, I will tell you about the results of our core IPs in the first half of the year. First of all, we have our flagship IP, that is, our MoYu IP. We can see that in the first half of the year, our user activity has increased significantly. This also led to a recovery in our revenue. At this time, it has played a very big role in the sustainable development of our game. At the same time, when it comes to AI applications, we started with some non-mainstream projects. But with the introduction of these AI applications, it has gradually penetrated into the core development process of our relatively very important core IP. Not only in the design of our colorization, but also in the development of our content volume, it can significantly enhance our efficiency. This has also played a good role in our future sustainable development, because from the perspective of the entire market,

The growth of the number of users in the first half of the year is mainly from two aspects. This year marks the 20th anniversary of Moyu.

The 20th anniversary of Dejian Liu, including the release of our new video area, the story, our new profession, and the optimization of our social media system, the optimization of the functions and content of this series in the game has significantly driven the return of our users. This return of users is not only because there are more users coming back, but also because the stability of users, including the flow, has been greatly improved. For the long-term game, our long-term flow was already at a very high level. Currently, for this optimization, we have at least 2.8% long-term flow improvement in the long-term flow. This is also a very stable phenomenon for our users. We expect this kind of ecosystem to continue to improve and stabilize. This has played a very good role in our future user ecology and income. Next page. Next, I will have to mention again the benefits of AI to us. First of all, AI produces our content. Although our development costs have dropped, the amount of content produced in our core flagship products is actually increasing. Compared to the second half of last year, We have released more content for our version. At least in terms of core model products, we have increased content output by at least 10%. This content output not only helps us to give users, whether it's content, gameplay, social media, and our public services, we have the ability to release more content through AI. At the same time, we have greatly improved the richness and depth of content. This is a long-term ability construction. We believe that in the future, with the addition of our AI capabilities, the content production and quality of core products will also be able to grow steadily for a long time. Okay, next slide. Next is our government IP. The government IP's overseas income this year and the first half of the year is a highlight. It not only reaches the number of users and many more. At the same time, due to the reduced exchange rate, you can see that with the continuous growth of our MMOs and the promotion and sale of our limited edition blocks, we have also made significant improvements in terms of revenue. In fact, AI will be more helpful for government projects, especially when facing different countries and different language versions overseas. We have the opportunity to use AI We are developing our web version, mobile version, and various language versions to allow our users and content to reach more users. At the same time, we can activate our historical users to continue to promote our users' activity and income growth. At this point, the government IP has a very good growth trend in the second half of the year. Next slide. In the case of Soul Reincarnation, it has achieved a very good result in the first half of the year. Last year was the 10th anniversary of Soul Reincarnation, which means that this is a long-term IP product that we have been operating since 2011. It has also made a similar growth this year. At this time, for a MOBA game, its IP youthfulness is also a very important point. Next slide, please. Next, in the first half of this year, we have launched more games and literature collaborations. In fact, in the entire content industry, games and literature have already entered a government welfare. The government, regardless of the local literature bureau, is very eager to interact with our games and provide us with more content. The game is not just a simple link under the help of AI. We can put the content of the game's text into the gameplay of our game. These changes have received very positive feedback from users, both in terms of user participation and commercialization. Therefore, from a long-term point of view, for a strong operating IP, continuous text provides continuous quality content. and many more. This is a very positive cycle of integration and expansion. We also look forward to investing in this aspect to bring more vitality to our long-term game. Next slide, please. Next, let's talk about AI employees. In fact, at the last conference, we have already done a general overview of this year. In terms of the entire plan, we have completed our original plan very well in the first half of this year. First of all, from the point of view of AI to our overall workload, it has already reached 35% to 40%. It is already a trend of continuous growth. At the same time, it brings not only a decrease in our R&D cost, but also an improvement in our R&D content and quality. AI employees are not just a tool-based use. They have become AI employees. They can automatically receive orders, analyze work, and deliver. At the same time, we pay great attention to the fact that the development of the game has a so-called periodicity. Our AI employees have now realized the actual expansion based on the content of the work. That is, in one position, we have the ability to launch 100 to 200 forces at the same time, which is equivalent to the original 100 to 200 employees working at the same time. This is also a subversion of the development nature of our game. In terms of new games, due to the smaller historical debt, AI can help us, especially in terms of workload. In the second half of the new year, with the accumulation of our single-point capabilities, we have the ability to create a stronger content loophole. Especially in terms of our content production and AI operation, there is a great opportunity. We can combine the development and operation of the game better through AI. In the second half of the year, I think it will play a better role in the promotion of AI, especially in terms of income. In particular, the continuous investment of the entire group in AI, we will see that AI has also found great opportunities in decision-making and the exploration of the field of self-study. We are able to grasp some of the strengths of AI in this field to help us make a better growth. OK, next slide. Here is actually a small case. In fact, in some areas, we have already achieved a fully AI-automated closed loop. That is to say, we put our overseas version, that is, our English version, Biao Yu, Wang Song, Lin Wei, Wang Song, Lin Wei First of all, in the past, we have no ability to push our game to more than 100 countries. Secondly, in terms of efficiency and detection opportunities, in fact, AI has found a national memory opportunity that people's teams have not found. This is what we value very much. AI is not only a potential on the base, but also a potential on commercial opportunities and results. This is a very important point that we are gradually discovering in the future. Next slide. In summary, AI has completed a complete recovery in some areas in the next half of the year. The first part is the initialization of AI. We already have a few core IPs that are very long-term. AI can help us to quickly launch different language versions. and many more. AI can help us to evolve more content versions to expand our users. and so on. At the same time, through AIOB, these contents have the opportunity to better understand the different needs of each market. We can see that different regions, different countries, their content preferences, their different cultures are still very different. In the past, we could only make a general version, Now, with the help of AI content production and AI operations, we have the opportunity to promote more targeted content production and operations for each market and country. This will also be a great help to our game business in the second half of the year. In the process of the recovery of the game industry, we have some good know-how in the past two years. From how AI makes games, how to make fun games, and how to make games that have more commercial opportunities, we have also received some feedback. From the perspective of the pipeline in the second half of the year, we will try to make AI meat songs, AI literature games, and AI short films, which we have a strong support chain in the past. At the same time, AI can make it complete, and we will continue to try. Because MMO is a large-scale game, there are various ways to play in MMO. We will also make some successful games in the future. I believe these will also have a lot of opportunities to appear overseas and domestically. Overall, we firmly invest in the core IP. Thank you everyone.

Thank you, Linton. Let me kind of go through mine very quickly, and then I'll go into one of our strategic moves, which is the AI workforce OS going forward.

So for mine, I think we'll talk about it as we manage to increase our gross margin and also decrease our off-packs in a very hard time.

So by the way, in terms of optimization of costs, actually we have continued and we will continue. So you will see the results. in the second half of 2026. And if you look at the performance exactly, we really narrowed the loss in Q2. So we are on the path to EBITDA in second half of the year, which is a combination of cost reduction and optimization. And also the taking advantage of the buying season Q3 and the Q2 and Q3, which we are encouraged. So yeah, thanks. This is actually very critical to our path forward, like I said earlier. The AP10 launch is very critical for the deployment of AI services. For the LE, it's actually our product that we can address the lower end market, which we call it the value market, which mostly is the market outside of the US. That said, With budget pressure in the U.S., we also expect to see the LEU will pick up momentum. That said, we also continue to look at whether we can provide even a better price performance product in the lineup, which you will hear from us very shortly. Next. Again, very important. This is actually related to our AI Workforce OS. We have over a million classrooms around the world, which is a great user base to deploy AI services. So we'll continue to work on this. We call it a million classroom agile socket. If we can deploy AI services into all of these sockets, we will create a very significant SaaS service going forward, which we are very excited about. Thanks. Okay, let me turn it into AI workforce platform, which I talked about earlier, Lin Chen also talked about it. I'm not going to go into great big details because this device is really designed more like a product introduction. Since this is an earnings call, I will hit the high level. So if you remember, we talked a lot about using AI, embracing AI. This is the result of doing the embracing of AI What we often realize, what we are using in AI to support our core gaming business and also our education business can be a really great platform for us to support other businesses in other sectors. So we decided to productize all the AI features that we develop. And also with the introduction of agentic AI, We feel this is actually a great opportunity. So this is the result of that. So if you look at this, we basically create a foundation with all the features in there, and then we can create a workflow using a GenTech AI to help businesses to grow. So we're going to focus on different verticals rather than approaching it from a horizontal standpoint. You can kind of think about it and really we are like an employment agency. Whatever employee you want, you want to employ, you can come in and you can employ the AI employees to support your businesses, which we are very, very excited about. Next. So from a go-to-market standpoint, we see many different ways to deal with it. Well, first of all, first and foremost, our businesses, both gaming and education, will embrace this. and others. And then, of course, we'll go after other businesses, which I have applied on the next page to show you. But the key on that one is actually our differentiation, which is our mode. Our mode is actually not really about the AI technology itself, because we're not in the frontier model where we're going to be using whatever model that fits our purposes. So we're going to be using all of those, if you will. But along the way, we're going to gain a lot of domain expertise and knowledge, which is our differentiation. That's why we call it the data flywheel. It will provide our competitive edge. So again, I mean, go back to what I talked about earlier. A lot of people think about doing AI is that you're working on a large language model. That's not our case. Now, for that said, we're going to be doing something like which I'll explain later on which solve a large language model. But the key is actually along the way we're going to gain industry knowledge and work with our AI that will be our big advantage. Next one. So this is the use cases that we talked about. So leveraging all the AI capability on our platform. The number one, we can go B2C, that we can do our games. which Linton talked a lot about. We can do learning, whether we do it through comic books or interactive courses and all that. So we can continue to do that. But equally important, if not more important, is actually we can do support B2B and also B2G. So we continue to use this platform to support our movement in Thailand. but not limited to Thailand. I can't talk about it right now, but it's actually talking to a lot of countries in Southeast Asia to use the same concept that we have in Thailand to support their growth. A lot of the nationwide AI education products that we can support, one being Cameroon that we talked about. That's the one that we will do what we call a sovereign large language model. Again, we're not going to do a large language model capability ourselves. We're going to leverage the open source or open way model around the world, mainly the fields of China and then in the U.S. probably will be Gemma. In China will be either Quinn, Deep Seek, or Kimi. to support our education large language model. The idea is actually to localize and virtualize the education model in a school that can support it. Because in some of the African countries, they do not have access to internet and they do not have access to the large language model that is around the world. So with us doing what we call solving large language model, which basically run on a $5,000 but you have GPUPC that you can support the entire school. So we see that as a great basis for us to help us in our education business. Now, I mean, that approach is not only limited to developing countries. We also piloting that in Hong Kong, as you speak, in, you know, about four schools right now, across different sections. So that's, I mean, when I talk about that, I also cover the Smart Education Platform, LLM. So in a nutshell, this is actually what we do. We started out internally, we embraced AI, but that whole effort has morphed into our future strategy, which is leveraging the AI workforce platform to support our Thank you very much. We'll continue, of course, optimization. Actually, on that one, we have deployed a lot of AI services, especially in customer support and all the back-end services. To deploy AI services in the U.S. is a little bit more tricky because of the data privacy issues. Actually, the same thing applies to Europe, but we have ways to get around it, so we'll continue to be optimistic. We are seeing some signs of market recovery in North America. Our budget is being released, so that's why we are cautiously optimistic about the second half. Again, I talked in nauseam about AI and also sovereign LLM, so that's going to be our future. So in a nutshell, we are cautiously optimistic about the second half. We believe it will be a very easy topic even in the second half of 2020. With that, I'm going to close this presentation. Thank you for your patience. Now we're going to open it up for questions and hopefully answers.

Thanks, Simon. Thanks, management. Now it's time for our Q&A section. If you are joining us on the webcast platform, Please click the Q&A button on the right-hand side of your screen and key in your questions. If you are joining us via phone line, please press star 1, star 1, and our operator will bridge you through shortly. 如果您希望透过网络平台发问, 请在画面右方点击问答键并输入您的问题。 如果您希望透过电话语音提问, 请在键盘按新一。 We are welcoming questions in both English and Chinese. 我们欢迎各位以英文或者中文提问。 So let's welcome our first question. 我们第一道问题是来自国海证券分析师,是关于游戏方面的问题。 上半年的游戏业务环比回暖十分明显。 How is the management's outlook on the game industry in the second half of the year? And how is our game income continuing to grow? Thank you.

Okay, Lin Zhen.

Okay, so in the second half of the year, our main income is driven by the number of users and the activity of users. So we are relatively looking forward to the trend in the second half of the year. Of course, we are... We will try to do the same in the second half of this year. Of course, we will not deliberately pull the growth of revenue. Because we still pay more attention to the long-term operation of the game. As for the increase in revenue, we still have some, for example, G-SAN's IP authorization game line-up, our AI game line-up, including our various IP version line-up. We also expect this part to be able to Thank you, Mr. Lin Chen.

The next question is about the game. It's a supplementary question. I would like to ask you a question. I saw that this year's AI has done a good job on the game performance. Yes, our management team has developed the content of the entire AI performance in the next half of the year and in the future. And then there is a cost operation. What are your expectations in terms of the decline?

Let me start with the fact that we have been playing with AI for many years, not just the first half of the year. Lin Cheng, why don't you try to answer that question? Okay, so we can see that AI has helped us to improve our efficiency.

In this stage, the cost is a big help because it does have a lot of space. Since the first half of this year, I have already mentioned that some of our results correspond to the cost decline, but some of our results are actually reflected in the improvement of our content output. As we saw earlier, with our AI operations, We hope to increase the efficiency of AI development and put it in the pull-up income section. This means that in the future, the number of people in our development team may remain stable. Because after we increase the efficiency, we will have more development investment in AI games, new businesses, and system expansion to continue to create a more positive cycle.

I would like to add something from my side. As mentioned earlier, the goal is to maintain stability. This is the end of June. So in the first half of the year, if we look at it from a social perspective, we will still have it. Because you can see that in the first half of the year, we still have to draw. We still have to draw. As Mr. Lin mentioned before, there are four types of AI applications. Before, the ratio was quite low. Now it is 50% to 50%. This year, it is 60% to 70%. So we saw that in the first half of the year, maybe in the second half of the year, there were still some. In the first half of the year, I said that the performance of Dejian Liu is almost the same. In the second half of the year, it will be a little smaller because the technology has been reduced. It's impossible to know how much it is every year. It's impossible. So as I said, the future focus is not only on the cost of development, but also on the evolution of content to drive our income growth. From this point of view, in the first half of the year, in the second half of the year, there is still oil. Thank you, Mr. Wen. Thank you, Mr. Chen.

The next question is also from China. The question is, how do we see the competition between AI and the current general models or AI agents on the market? Especially in the context of education, content creation, we have more vertical data. How can we show our advantages in this regard? Thank you. How much time do we have? I'm kidding. I'm kidding.

Because that question is a loaded question in English.

We asked a lot of questions. I'll explain it briefly.

Actually, I have emphasized many times that we are not doing a big model. So it has a competitive relationship with other large models. In fact, there is a very good cooperation relationship. Because now there is actually no large model that can do everything well. So in fact, each large model has its strengths and weaknesses. In fact, our platform is the best. It is according to the needs of our customers. We will go with which large model. to use its functions. For example, video, we can get a certain model. For other things, we can get another model. We can get the best, and the price is better than the performance price for our customers. This is the first. The second is the knowledge in the industry. Because no matter how simple the data is, it's not as simple as the data. The most important thing is that after we collect the data, how do we turn it into knowledge? So that's why I was just talking about the so-called sovereign LLM. In Chinese, it can also be called the sovereign large model. In fact, it may not necessarily be a large model, because there are different methods that can implement it, that can use large model technology. It can also be called a REC technology, and LLM Wiki. That's our differentiation. That's how we do it. Just now, I talked about how we do the 3D model. We actually have B2C and B2B. I think B2B will help us in scaling. It will be faster. So, of course, in terms of games and education, and then in terms of finance In terms of training, we will use our platform. In fact, the game has been mentioned many times. We will not repeat it again. In terms of education, there are several aspects. In our education, of course, it is the same as the game. We also use a lot of AI in cost optimization. And then in terms of product, how do we help teachers We are also thinking about how to use our AI staff OS to help each school to manage. For example, we have the concept that AI vice president can help do a lot of administration functions. So actually, that's back to what I just said. Why do I say that? In the SaaS model, we are more encouraged to have a lot of exchanges with our products. We can put the AI workforce platform on our platform. In fact, our AI service or model, we have considered in education that we will definitely use other models. In addition, we have also considered our own so-called sovereignty model. There may be two ways to do it. One is to put it in the cloud. The second is to put it locally in the school. We are testing it now. We can put this model in the middle. One may be in a mobile phone. Why put it there? If it is in the mobile phone, we can help. Thank you, Simon. The next question is from our

I'd like to ask you a question. Can you introduce us to Rocket and Shuai Ku's investment and our business? Let me just briefly talk about it.

Because we are investors, we can't talk too much. Of course, we think it's a good company, so we are interested in it. Rocket, I think you... I can briefly talk about Rocket. Actually, we are talking about our SaaS service and how we use LLAM in education. This is what we imagined. In the very near future, we will also add Rocky's glasses. It's like a use case. A teacher in a classroom can bring his AI glasses in and ask questions. For example, if a student has a problem, he can go through Rocky and ask the AI. And then the information can be Thank you, Simon. Next is a question about gaming. Are you interested in AI?

I hope Mr. Lin can help us analyze the impact of AI on user experience, flow rate, and analysis. In addition, I hope Mr. Lin can help us introduce the overall performance trend of the game since the summer break. Thank you.

Okay, the first question is, what kind of help does AI bring to our game and key data? I will divide it into two categories. The first category is indirect help. The second category is direct help. For indirect help, as I mentioned earlier, through AI, we actually increased the content output by 10% and increased the quality of the content. For example, for the IP that we create, for example, for a certain PC, it may have a growth of about 15 to 20 minutes online. In terms of traffic, as mentioned earlier, there may be an absolute growth of 2.8 percent. For us, this is still a relatively long-term game. It is a relatively wide-ranging game. Therefore, the first category of AI is to help us improve the output and quality of content to indirectly drive the continuity and flow of the game. This is the first category. The second category, in fact, is that we may put it all in the so-called Smart PC. In the first half of this year, our AI NPC has also made progress. Through AI companions, AI pets, and various AI contents, users can directly communicate with AI NPCs via voice or text. In August, there were some policy talks in the country. From the perspective of compliance, we can guarantee compliance first. Then, within the scope of compliance, we will try our best to test the user's interaction with AI in various ways. We also found that indeed some of the needs for emotional compensation will emerge from the user and AI's approach. I believe that this part will also satisfy the player's need for individualization in the future to drive our online activities and activities. This is the first This is the first aspect. The second aspect is about the trend of summer holidays. I would like to add a little bit about this. Because our... Especially the MoYu IP and our ZhenHu IP are basically adult IPs. So the whole period of time it takes to recover may not have much to do with the summer holidays. Because if it has much to do with the summer holidays, it may take more time to mature. Of course, there is growth in the summer holidays. Our next question is regarding our education business.

How does the company view the recovery outlook for our overseas education technology market in the second half of the year? And judging from our order on hand, do we see any customer demand rebound?

I thought I talked about it. Actually, we're cautiously optimistic. So we are seeing some movement in the US. So that's why we are cautiously optimistic. I'm cautiously optimistic. I have to admit, it's actually quite slow in the Middle East for obvious reasons. I would not expect to see the Middle East recovering in the second half of the year. Europe is actually highly depending on a couple of countries, one being Germany. So again, I mean, we are cautiously optimistic. I think 2027 will be the year of recovery for us.

Thank you, Simon. So due to the time constraint, we are welcoming our last question right now. Okay. Okay. Okay.

We are about 6 billion Hong Kong dollars. You can do some math. You can know that this is our plan. So for now, we don't want to change it. To be more specific, from our current situation, at the end of June, we still have 10 billion yuan of cash in our hands.

So Simon and I have mentioned a lot about our situation in the second half of the year, whether it's education or gaming, we still think it will continue to improve. So in the future, we are very confident that we will be able to compete. We just mentioned in March that we will be able to return to the program. So we are very confident that we will be able to return to the program.

I'm sorry, I was just kidding. Okay. Okay. Thank you.

Thank you. Thank you. Thank you. Thank you. Let's successfully conclude our presentation today. Once again, thank you for joining us. We wish you have a great day ahead.