Open-source Securities: AI applications are gradually rising, with AIDC leading the way.

Open-source securities released a research report stating that as downstream enterprises continue to increase their usage of large-scale models from cloud providers, this may drive cloud providers to continuously increase their computing power infrastructure load, leading to an increase in demand for AIDC (AI Datacenter) infrastructure. The rapid growth in the number of AI applications on the web and apps is continuously increasing, boosting the demand for AIDC infrastructure. AI application terminals are expected to see a large-scale push with the combination of cloud and edge, driving the demand for AIDC. The main points of the open-source securities are as follows: CES2025 AI application terminals will see a large-scale push, with the combination of cloud and edge driving AIDC demand. Wearable devices equipped with AI functions such as AI translation earphones, AI bracelets/pendants, AI rings, and AI AR/VR glasses were showcased at the CES2025 international consumer electronics exhibition, featuring flagship MR devices with 8K Micro-OLED screens and AI large models for functions such as AI search, text translation, music creation, etc. The Thunderbird V3 AI glasses actively embrace Alibaba and Qualcomm, implementing AI SoC and AI edge large models. Smart homes are accelerating AI transformation, with various AI toy applications on display. With the continuous enhancement of the performance of small model AI on the edge, the empowering role of AI on terminals continues to be highlighted, leading to a gradual increase in demand for terminal AIoT modules and intelligent modules for latency-sensitive inference applications. The increasing usage of large models from cloud providers by downstream enterprises may drive cloud providers to increase their computing power infrastructure load continuously, leading to a demand for AIDC infrastructure. The user base and usage of AI applications in China continue to grow, with apps like Douba and Kimi leading the way in releasing the demand for inferences. The increase in demand for inferences is also driven by the rapid growth of AI applications on the web and apps. Overall, the user base and usage of AI applications in China continue to grow, with Douba and Kimi leading the way in releasing the demand for inferences. Web traffic data shows that Kimi, Douba, and Wenxin Yanyan AI intelligent assistants have a leading position, with the potential for a further increase in demand for inferences. The demand for inferences and training accelerates the release of AIDC demand, with a focus on AIDC suppliers with scarce resources. As internet giants such as ByteDance, Alibaba, and Tencent continue to deploy AI applications, there is the potential for increased demand for AIDC, emphasizing investment opportunities in AIDC. Recommended AIDC core suppliers for ByteDance: Range Intelligent Computing Technology Group (300442.SZ), Shanghai Baosight Software (600845.SH); beneficiaries include Beijing Sinnet Technology (300383.SZ), VNET Group, Inc. Sponsored ADR (VNET.US), Business-intelligence Of Oriental Nations Corporation (300166.SZ). Recommended AIDC core suppliers for Alibaba: Shanghai Baosight Software (600845.SH), Range Intelligent Computing Technology Group (300442.SZ); beneficiaries include GDS-SW (09698). Recommended AIDC core suppliers for Tencent: Shanghai Baosight Software (600845.SH); beneficiaries include Kehua Data Co., Ltd. (002335.SZ), Beijing Sinnet Technology (300383.SZ). Beneficiaries of AIDC core suppliers related to Baidu Inc Sponsored ADR Class A: Guangdong Aofei Data Technology (300738.SZ). Important AIDC beneficiaries include INESA Intelligent Tech Inc. (600602.SH), Shanghai AtHub (603881.SH), Wangsu Science & Technology (300017.SZ). Risk warnings: AI and cloud computing development falling short of expectations, delays in cabinet deployment, intensified industry competition, etc.