Increase research and development and SaaS transformation and upgrading Wanxing Technology profit reduction in 2021

Shuya Jiang Wanxing Technology recently released a performance forecast, is expected to 2021 attributable to the shareholders of the listed company’s net profit of 18 million to 26 million yuan, a year-on-year decline of 79.24% to 85.63%.The main reason for the change in performance is the company’s increased research and development and SaaS transformation and upgrading.According to the announcement, wanxing’s r&d spending in 2021 increased by about 50% from the same period last year.During the reporting period, Wan Xing increased investment in technology research and development of science and technology, vigorously the introduction of high-quality elite technology talent, increasing the original product optimization and development of new products, new technology, strengthen the creative video algorithm, AI based and virtual digital and virtual scene construction and application, to complete a new generation of video technology engine WES into production be born, strengthen product.In addition, the company invested large research and development resources for subscription order management, transaction payment platform, customer operation platform construction and upgrade.Continuous investment in elite technical personnel, algorithms, subscription order management, etc., actively supports the SaaS upgrade of Wanxing Technology.According to its 2021 semi-annual report, Wanxing Technology redefines “user-centric” with subscription model, and breakthroughs have been made in several key indicators related to subscription transformation.The annual performance forecast shows that subscription orders accounted for the proportion of total orders continued to increase rapidly due to the company’s rapid subscription transformation and upgrading.SaaS transformation will be beneficial to business development in the long term, but in the early stage of transformation, the unit price of current users and customers often falls, which is regarded as a strategic measure for enterprises to exchange short-term profits for long-term development.As the subscription sales price was much lower than the software license sales price, the average unit price of orders fell to a certain extent, adversely affecting operating revenue, the forecast showed.In addition, the continued global epidemic, overall year-on-year decline in external market flows, RMB appreciation and other external comprehensive factors also affected the company’s performance growth.It is worth noting that Wanxing technology is continuing to deepen its efforts in the field of digital creative software, and increasing its attention to and exploration of the new trend of the meta-universe. It is also increasing the economy of enabling creators in terms of products, technologies, resources and industrial ecology, and actively supporting the long-term development of the company.In terms of industrial ecology, Wanxing Technology has recently been invited to become a member of China Mobile Communications Federation Meta-space Industry Committee, and will boost the development of China meta-space industry together with colleagues in the industry.In January this year, the company, together with Tencent, Alibaba, Bytedance and other enterprises, was awarded the “Meta-universe” outstanding construction enterprises, and was selected into the “2021 Top 10 Enterprises Changing People’s Living Habits” list released by Internet Weekly, Net Research Institute and Deben Consulting.(Editor Lee Bo)

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