On the evening of March 27, Xuanwu Cloud (2392.HK), a leading smart CRM service provider in China, announced its 2023 annual results announcement. During the reporting period, the company's overall revenue increased 22.8% year-on-year to 1,281 billion yuan. In terms of business development, Xuanwu Cloud adheres to the concept of technology+business two-wheel drive. While continuing to deeply cultivate the four major industries of big consumption, finance, government enterprises, and TMT, the company also released a multi-modal model perpendicular to the big consumer industry - Xuantao during the reporting period, empowering consumer goods enterprise terminals to achieve digital intelligence growth; in addition, Xuanwu Cloud has also strengthened ecological cooperation at home and abroad, opening up the overseas layout of the communication business, adding a new “engine” to the company's accelerated future development.

Judging from the company's revenue composition, Xuanwu Cloud's SaaS and PaaS sectors both maintained growth of more than 20% during the reporting period. Among them, the PaaS sector achieved revenue of 690 million yuan, an increase of 21.3% over the previous year. The more focused SaaS sector achieved revenue of 591 million yuan in the current period, an increase of 24.6% over the previous year.

Regarding the growth of the SaaS sector, Xuanwu Cloud stated in the announcement that there are three main reasons: the first is the increase in customer demand for the company's SaaS services, the second is the company's continuous optimization and launch of products that meet customer and market expectations, and the third is the increase in the number of core customers of the company's SaaS services.

According to the data, as of the end of the reporting period, the total number of Xuanwu Cloud customers was 2,970. The total core customer contribution value (ARPU) increased 25.9% from the previous year to 3.7 million yuan, and the net revenue retention rate (NDR) of core customers increased to 112.7%. This also means that Xuanwu Cloud's product value has been continuously recognized by more customers, and they are willing to further increase their own budget investment. Among them, in the SaaS sector, the number of the company's customers reached 2,120, an increase of 28.9% over the previous year. At the same time, the per capita contribution value (ARPU) of SaaS core customers reached 2.4 million yuan, an increase of 12.3% over the previous year.

In terms of technology and product innovation, Xuanwuyun released the first domestic multi-modal large-scale model perpendicular to the consumer industry during the reporting period, codenamed “Xuantao”, which will help the company's AI to recognize more accurately and generalize. Based on this, Xuanwu Cloud further enriches and perfects AIGC product applications for the entire business chain of large consumer terminals around people, goods, and has successively released AIGC applications such as “Display Commander” and “Visit and Summary Assistant”. At the same time, the company also launched DI Smart Store to help consumer goods companies increase their terminal scale and sales volume.

In the field of smart finance, Xuanwu Cloud's star product ICC (Integrated Communications Center) in the marketing cloud sector has successively completed localization adaptations with Baoland, Oceanbaes, etc. At this point, ICC has completed the localization adaptation of the entire chain of innovation. At the same time, Marketing Cloud has also further focused on financial, government and enterprise solutions in the field of precise marketing, and has launched a data management platform (DMP) with the goal of accurate delivery, intelligent management, and increasing conversion rates.

Furthermore, Xuanwuyun's operating expenses rate fell to 21.5% in 2023, down 4.4 percentage points from the same period of the previous year. This is mainly due to the company's internal organizational structure updates during the reporting period. The announcement shows that in terms of external customer service, Xuanwu Cloud carried out integrated and localized operations for sales, implementation, pre-sales, and after-sales service departments to increase the value of the company's customer management system and help the company maintain a healthy cash flow; in terms of product development, Xuanwu Yun promoted the “quantitative profit growth model” proposed by industry research institutes to upgrade AI and DI from the original BU to the product division.