The Zhitong Finance App learned that on May 20, the fourth paradigm (06682) of the industry's largest model share was announced, and the company spent about HK$3.753,900 to buy back 70,500 shares.

Notably, on March 21, the Fourth Model issued an announcement stating that the board of directors of the company plans to seek to buy back the company's shares in the open market from time to time, and the total amount to be used is not more than HK$300 million. The company believes that the proposed share repurchase under the current circumstances can show that the company is confident in its business outlook and prospects, and will ultimately bring benefits to the company and create value for shareholders.

Real money repurchases have now begun to be implemented, which indicates that management believes that the company's current value is undervalued. Furthermore, at present, the world has entered the fourth industrial revolution represented by artificial intelligence technology. The company has been deeply involved in the field of large-scale models in the industry for ten years. Growth potential can be expected, and the future is expected to usher in a “double attack by Davis.”

From a fundamental perspective, on March 20, Fourth Model released its first annual results since listing. According to financial reports, the company's revenue during the reporting period increased 36.4% year-on-year to 4.204 billion yuan, achieving rapid growth. At the same time, the company's adjusted net loss during the reporting period narrowed by 17.6% year on year, and the adjusted net loss ratio fell to 9.9%, achieving continuous loss reduction since 2021.

In fact, since 2021, the fourth paradigm loss reduction trend has been very obvious, making the company's profit path gradually clear and clear. Once the break-even point is crossed, fourth-paradigm profits are expected to be released at an accelerated pace, driven by the effect of scale.

From 2019 to 2022, revenue from the fourth paradigm increased from 460 million yuan to 3,083 billion yuan, with a compound annual growth rate of 88.5%, showing strong growth potential.

Looking at industry trends, artificial intelligence+the infinite promise brought by thousands of industries opens up room for long-term development of the fourth paradigm.

The fourth paradigm has been deeply involved in high-dimensional models for nearly 10 years, developed systematic large-scale model development capabilities and commercialization capabilities, and has accumulated more than 4 years in the direction of large-scale models. Under the generative AI wave, the company released the big model in April 2023, and based on this, the company released the AIGS Strategy (AI-Generated Software), which uses generative AI to restructure enterprise software and finally achieve AIGS through the three stages of Copilot, Copilot+ knowledge base, and thought chain COT+Copilot.

Currently, the company's big model has been implemented in various industries such as aviation manufacturing and retail to help customers improve operation and management efficiency.

According to SDIC Securities, the fourth paradigm is expected to become the “leading enterprise software service leader in the AI 2.0 era”, thanks to the company's significant first-mover advantage in pointing to the enterprise-level AI agent market. This first-mover advantage is expected to be transformed into a key competitiveness for rapid business implementation. While driving existing benchmark customers to increase paid revenue, it will also push the company to acquire new customers at lower sales expenses, thereby helping the company build a growth flywheel and drive continuous improvement in performance.

If we look at the value of the fourth paradigm from a long-term perspective, we need to focus on industry replacement. Different stages of development are driven by different new technologies. This is inevitable for new technology and industry trends. Now that we have entered the era of artificial intelligence, new technology giants will inevitably be born. They have gradually become the fourth paradigm for intelligent enterprise transformation infrastructure builders, and will surely benefit from the development of the entire artificial intelligence era.