Xiaomo: Zhi Spectrum (02513)'s API business grew sharply in the first half of the year and raised the target price to HK$2,000

The Zhitong Finance App learned that J.P. Morgan Chase released a research report saying that Zhi Spectrum (02513) had revenue of 954 million yuan in the first half of the year, up 400% year on year, and cloud-based business revenue of 825 million yuan, up 2,736% year on year. This is roughly in line with expectations and now accounts for 86.5% of total revenue. The bank raised its 2026 and 2027 revenue forecasts by 14% and 18% respectively, and raised the target price from HK$1,800 to HK$2,000, reaffirming the “Overweight” rating.

The more important update comes after June: Smart Spectrum's annual recurring revenue (ARR) for August reached US$1.6 billion, which means that August's revenue alone is about US$133 million, which has already surpassed the API business of US$123 million (825 million yuan) in the first half of the year, while management now expects ARR to reach US$2.4 billion by the end of the year, a sharp increase from the previous guidance of US$1 billion.

J.P. Morgan continues to be optimistic about the position of Smart Spectrum in the field of large-scale models in China, as its rapid model iteration, ability improvement can be effectively converted into paid use, and reasoning capabilities continue to improve.