Dawning Information Industry Co.,Ltd. achieved operating revenue of 3.199 billion yuan in the first quarter of 2026, representing a year-on-year increase of 23.71%. Net profit attributable to shareholders reached 228 million yuan, up 22.19% compared to the same period last year. Net profit after deducting non-recurring gains and losses was 164 million yuan, marking a significant increase of 53.30%.
The growth rate of the non-GAAP net profit surpassed the revenue growth. According to the company's disclosure, this was driven by the continuous expansion of core business boosting profitability, coupled with a decrease in non-recurring income as government subsidies previously approved for a subsidiary were fully amortized for their designated purposes. Earnings per share rose from 0.128 yuan in the prior-year period to 0.156 yuan, while the weighted average return on equity reached 1.02%, an improvement of 0.11 percentage points year-on-year.
Research and development expenses for the quarter amounted to 592 million yuan, a sharp increase of 51.7% compared to the first quarter of the previous year, accounting for approximately 18.5% of the operating revenue. Additionally, the company advanced its plan to issue convertible bonds during the quarter.
While both revenue and net profit increased, impairment losses expanded significantly. Total operating revenue for Q1 2026 was 3.199 billion yuan, an increase of 613 million yuan from 2.586 billion yuan in the same period last year. Operating costs were 2.350 billion yuan, up 22.9% year-on-year. The slightly slower growth rate of costs compared to revenue led to a modest improvement in the gross profit margin.
Total profit was 274 million yuan, an increase of 18.12%. Net profit was 192 million yuan, up 13.3% year-on-year. The net profit attributable to shareholders of the parent company was 228 million yuan, which was higher than the overall net profit. This was primarily due to a loss of 35.89 million yuan attributable to non-controlling interests, resulting in the parent company shareholders absorbing a larger share of the profits.
A notable point was the credit impairment loss, which swung significantly from a loss of approximately 7.9 million yuan in the same period last year to a loss of 62.33 million yuan this quarter. This was mainly due to a large provision for accounts receivable impairment, which somewhat constrained the further release of operating profit. Excluding this impact, the improvement in the profitability of the company's main business would have been more pronounced.
A surge in R&D investment led to costs slightly exceeding revenue, with investment income providing crucial support for profits. The substantial increase in R&D spending was one of the most prominent figures in the quarterly report. R&D expenses reached 592 million yuan, up 51.7% from 390 million yuan a year earlier. This high level of investment intensity aligns with Dawning Information Industry's strategic position as a core domestic supplier of high-performance computing and AI computing power.
Driven by the wave of large AI models, domestic demand for computing power continues to grow. The company's increased R&D investment helps solidify its technological moat and builds capacity for future product iterations. It is noteworthy that the high R&D expenditure pushed total operating costs to 3.202 billion yuan, slightly exceeding the total operating revenue of 3.199 billion yuan. The operating profit remained positive for the period, largely reliant on investment income of 184 million yuan contributed by associates.
Investment income increased by 43.4%, with associates contributing nearly 190 million yuan. The company's total investment income for the quarter was 187 million yuan, a year-on-year increase of 43.4%. Income from investments in associates and joint ventures amounted to 184 million yuan, forming a crucial support for the total profit. The scale of long-term equity investments reached 9.239 billion yuan, an increase of approximately 272 million yuan from the end of the previous year, indicating the company's ongoing efforts to expand its ecosystem investment layout.
This structure suggests that Dawning Information Industry's profit model is not solely reliant on product sales but is built around a platform-based architecture centered on high-performance computing, radiating outwards across the industry chain. By obtaining stable equity income through investments in associates, the company is gradually forming a dual-engine profit structure driven by both core business sales and investment returns.
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