The bright future is expected to have a revenue of approximately 0.48 billion yuan in the first half of 2024, with a year-on-year increase in the number of recurring customers of 23.3%.

[August 28, 2024 - Hong Kong] China's leading mobile internet marketing technology and solutions expertBright Future Technology Holdings Limited ("Bright Future" or the "Company", together with its subsidiaries collectively referred to as the "Group"; stock code: 1351.HK) released its interim performance announcement for the six months ended June 30, 2024 ("the reporting period").

In the first half of 2024, despite the strong momentum of China's economic development, the external environment is becoming increasingly challenging, with sluggish global economic growth and poor trade conditions. In this challenging context, the recovery of the Chinese economy is inevitably hindered, resulting in lower-than-expected performance in the advertising market in the first half of the year. Faced with rapidly changing market demands and intensifying market competition, Bright Future has taken proactive strategies to adapt to market trends, adjust internal structures, and achieve operational and cost benefits.

During the reporting period, Bright Future recorded revenue of approximately RMB 0.48 billion, a year-on-year increase of approximately 4.1% compared to the same period in 2023. Measured by transaction volume, gross revenue decreased slightly by 2.6% year-on-year to approximately RMB 6.8. Despite the unfavorable market environment, the Group focused on developing its integrated smart marketing solutions services, achieving stable revenue performance, and demonstrating strong business resilience.

Due to the increase in media testing flow cost in the first half of the year and advertisers' increased caution towards advertising costs, Bright Future provides customers with more accurate and cost-effective smart marketing services in order to achieve long-term sustainable and healthy profitability. During the reporting period, the Group recorded a gross profit of approximately RMB 30.468 million yuan and a net profit of approximately RMB 3.542 million yuan. Excluding the impact of share-based compensation and income tax expenses, the adjusted net profit for the reporting period is approximately RMB 4.762 million yuan.

Service improves customer loyalty and deepens media relationships.

According to the announcement, with the changing consumer behavior and preferences in China, the industry is facing new opportunities to cater to the changing values and evolving demands of Chinese consumers. On the other hand, the development of generative AI technology (AIGC) has become a major driving force for innovation in various industries. Therefore, in addition to maintaining stable cooperation with well-known internet giants in fields like network services, tools, finance, and e-commerce, the Group has actively established new business relationships with insurance, local life, and entertainment clients with development potential in the post-pandemic market, and steadily expanded the scale and quantity of cooperation with AIGC product clients.

In addition, the Group is committed to expanding its cooperation with top anchors to further diversify its customer base in the e-commerce industry and enhance its influence in the live streaming industry, with the aim of cultivating a more diverse customer base and expanding its market coverage and influence.

In the first half of the year, the number of repeat customers for the Group increased by approximately 23.3% to 296, and it steadily expanded with 172 new customers (compared to 176 in the same period of 2023), demonstrating that the Group, even in a turbulent market, is still able to improve customer loyalty with high-quality services and maintain a stable customer base.

At the same time, the Group has successfully maintained and expanded its business relationship with well-known domestic media platforms. For example, the Group has been appointed as the exclusive service provider for the audiovisual entertainment industry of Shenzhen Honor Software Technology Co., Ltd. ("Honor") for 2024, and has been appointed as the core agent for Honor's push service ("Honor PUSH") and Honor's business promotion platform ("Honor Business Promotion"). In the first half of the year, the Group also obtained the four-star enterprise certification from Baidu, which serves as a testament to the Group's industry strength.

The Group is committed to deepening cooperation with top-tier media platforms in order to achieve mutual benefits. During the reporting period, the Group recorded a total consumption of approximately 0.82 billion virtual tokens through media platforms, an increase of approximately 3.7% compared to the same period in 2023.

Ensuring quality and quantity to seize the new growth momentum of short videos.

During the reporting period, short videos continued to dominate the advertising industry in China. According to the Quarterly Report on China's Mobile Internet Traffic for Q1 2024 released by Shanghai iResearch Consulting Co., Ltd., in the first quarter of 2024, the monthly active users of short video applications exceeded 1 billion, with a user penetration rate of 82.2%. The rise of short dramas has also injected new vitality into the short video advertising industry, enabling advertisers to enrich their advertising content forms and explore innovative ways of audience participation.

At the same time, AIGC technology and products have made significant progress in the field of advertising creative content generation. The continuous exploration and improvement of AIGC technology applications are influencing the development of the advertising industry, providing new possibilities for effectively and innovatively attracting audiences. The Group has further upgraded and improved its self-developed LinkBriAI system, honing its precision marketing capabilities, strengthening the application of AIGC and other technologies, updating the content and form of short videos, and continuously improving advertising strategies. In the first half of the year, the Group's monthly video production capacity was approximately 19,600 clips (compared to approximately 17,500 clips in the same period of 2023). As of the end of the reporting period, the Group had also reached approximately 704,600 inventory videos (as of December 31, 2023: approximately 587,000 inventory videos).

Future Strategy and Outlook

Looking ahead to the second half of 2024, although uncertainties in the external environment still exist, the Chinese market has demonstrated strong resilience. The National Development and Reform Commission, together with other government departments, has launched new consumer scenes such as cultural exchange, tourism, and sports, aiming to stimulate economic activities and cultivate new economic growth drivers in the consumer market. As a late-cycle industry, the advertising industry is expected to benefit from the orderly and sustained recovery of the macro economy. In addition, AIGC technology and the short video marketing industry have strong adaptability, and are also expected to further expand the market size of the industry and stimulate new growth momentum.

Mr. Dong Hui, Chairman and CEO of Bright Future Group, said, "In recent years, we have witnessed the rapid development of short video technology, but no technology can exist without being people-oriented. This year, we have further strengthened the management of our internal teams and improved their capabilities in the use, research and development, and production of emerging technologies. The market is constantly changing, but structural opportunities are always waiting to be explored. We believe that excellent teams and outstanding technologies are the keys to seizing future opportunities. The market has a way, and the road lies beneath our feet."

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About Bright Future Technology Holdings Limited

Established in 2015, Bright Future is a leading marketing technology and solution expert in China, providing technology and data-driven smart marketing solutions based on the independently developed AIGC service embedded in the system platform. The company actively promotes short video marketing, pioneering the short video incubation matching platform, and maintains high-quality short video and other advertising material resources in the long run to tap into the vast untapped market. It covers 200+ top and long-tail traffic media companies across the entire network, with partners including Tencent, Alibaba, ByteDance, Baidu, and other well-known internet groups.

Bright Future Technology Holdings Limited was listed on the main board of the Hong Kong Stock Exchange on November 11, 2020.

Stock code: 1351.HK. Company website:www.btomorrow.cn

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