FOURTH PARADIGM(06682)platform business grew by 50.2% in the first three quarters, with over 40 AI products providing strong growth momentum.

On November 19th, FOURTH PARADIGM (06682) released its core business progress for the period ending September 30, 2024. The company achieved a revenue of 3.218 billion RMB in the first three quarters of this year, an increase of 26.1% year-on-year; gross profit was 1.35 billion RMB, a year-on-year increase of 12.5%. The company's core business, the Prodigy AI platform, grew significantly with a revenue of 2.171 billion RMB, a year-on-year increase of 50.2%. According to data from the international research firm International Data Corporation ("IDC"), FOURTH PARADIGM has maintained the first position in the Chinese machine learning platform market share for six consecutive years. The company continues to optimize key capabilities in the Prodigy AI platform, such as AI Agent and GPU resource pooling, and has achieved end-to-end capability supply at the calculation level, platform level, model level, and application level. Through the "Prodigy Inside" model, the company has efficiently created more than 40 artificial intelligence products, greatly expanding the industrial ecosystem and the boundaries of artificial intelligence applications empowering various industries. In the first three quarters, FOURTH PARADIGM's customer service depth and user stickiness continued to improve, focusing on key industries such as transportation, energy, finance, and telecommunications. During this period, the company had a total of 224 enterprise users, with the average revenue contribution per benchmark user being 14.87 million RMB (benchmark users: Global Fortune 500 companies or listed companies). With a 50.2% growth in core business, the 40 AI products under the "Prodigy Inside" model provide long-term growth momentum. The Prodigy AI platform is the core of all of the company's businesses. In the first three quarters, the Prodigy AI platform 5.0, a large-scale model development and management platform of FOURTH PARADIGM, has achieved end-to-end capability supply at the calculation level, platform level, model level, and application level. The Prodigy AI platform continues to optimize key capabilities such as AI Agent, GPU resource pooling, and model management, while integrating generative AI with various ecological products and solutions to promote the landing process of generative AI. For example, the AI Agent has improved the accuracy of complex reasoning and execution, covering the entire process of large model Agent design, development, debugging, release, operation analysis, and self-learning optimization to provide stable and reliable support for Agent production applications. Additionally, the company has further improved the functionalities and application effects of AI Coding products on the enterprise side, reducing development thresholds, increasing code development efficiency, transforming enterprise software interaction methods, and achieving the goal of scaling up AI applications. The company continues to innovate AI business application models by constructing scalable artificial intelligence products for different scenarios through the "Prodigy Inside" model. As of September 30, 2024, the company has developed more than 40 artificial intelligence products under this model, including intelligent mouse solutions, intelligent meeting solutions, vGPU, AI Data Foundry, large model toolchain, integrated platform "Tianshu" for search and promotion, large model management platform Model Hub, intelligent question and number, AIDIGIHUMAN video synthesis platform, document digitization management platform Smart Archive 2.0, AI + 5G video marketing, AI quality inspection system, 3D scanning and modeling equipment, among others, which have been widely applied in enterprises, expanding the industry coverage space of the Prodigy AI platform and providing long-term growth momentum for the company's future business development. AI Agent empowers multiple solutions, and the company is scaling up benchmark industry large models. During this period, FOURTH PARADIGM further expanded the coverage and penetration of its technology and products in multiple industries and scenarios. In terms of product feature iteration, the company has incorporated AI Agent capabilities into AIGS Builder, AIGS CodeX, and various intelligent hardware solutions to provide products with the ability to solve more complex reasoning and execution tasks. The AI Agent based on reinforcement learning technology has formed a self-learning cycle, with the model's inference and execution abilities becoming more accurate the more users use it. During this period, the company, together with benchmark users, jointly created a batch of demonstrative industry large models, accelerating the application of artificial intelligence technology in various industries. In the transportation sector, the company collaborated with a global leading port group to build a large model for port supply chains, providing intelligent capabilities for the transformation of port supply chain comprehensive services and promoting the sustainable application development of large models in the port and shipping industries. In the academic translation field, the company collaborated with modern publishing institutions to build the first professional large model for domestic publishing, achieving academic-level translation capabilities for large models, with a BLEU (BLEU: a mainstream evaluation standard for machine translation, mainly evaluating the similarity between machine translation results and manual reference translations) improvement of over 30%, meeting the high-accuracy translation requirements in the academic vertical field.