Soochow: The artificial intelligence industry is in a rapid development stage, focusing on the growth potential of consumer electronics.

Soochow released a research report stating that the artificial intelligence industry has gone through an exploratory period and a growth period in the past nearly 20 years, and is currently in a phase of rapid development. According to the "National Information Development Report (2024)", the user base of generative AI products in China has reached 249 million, accounting for 17.7% of the total population. The AI industry chain is mainly divided into: the basic layer, the technology layer, and the application layer. The global artificial intelligence industry has entered a high-speed development channel. From 2019 to 2023, the market size has increased from $1,917 billion to $4,732.7 billion. It is further expected to accelerate from 2024 to 2027, with the market size expected to exceed $11.6 trillion by 2027. The size of the AI market in China is expected to exceed 400 billion yuan in 2025, with large models, embodied intelligence, and intelligent driving becoming growth engines. Soochow's main points are as follows: AIPC: Intelligent Revolution in Productivity Tools The combination of PCs and AI large models is natural, derived from the powerful computing and storage capabilities, rich interactive methods, and extensive application scenarios of PCs, which highly meet the demands for personal large models. The application scenarios of AIPC are continuously expanding, from traditional office and entertainment fields to education, medical, finance, and other industries. Recommended focus: THUNDEROBOT, HONGXI TECHNOLOGY. AI Wearable Devices: Significant Improvement in Human Cognitive Means Wearable devices are not just hardware devices, but also achieve powerful functions through software support, data interaction, and cloud interaction. Currently, the main forms of wearable devices are smart glasses, smart watches, smart wristbands, and so on. By connecting to the internet, combining with various software applications, wearable devices enable users to perceive and monitor their physiological conditions and surrounding environments, quickly view, reply, and share information without manual operation. Their functions cover many areas such as health management, sports measurement, social interaction, casual games, audio and video entertainment, location navigation, and mobile payments. Recommended focus: ZZT, HAOSHENG ELECTRONIC. Generative AI Smartphones: Accelerating the Replacement of New Generation Smart Terminals Starting in 2024, numerous domestic and foreign companies have launched flagship AI smartphones and announced their respective development strategies, leading global mobile phone manufacturers to enter the AI smartphone race. Currently, the market's demand for end-side AI capabilities continues to increase, and AI functions have initially landed in high-end products of various mobile phone manufacturers. The strategic deployment of AI smartphones by major manufacturers is closely linked to their path to high-end and AI capabilities will become an effective driving force for mobile phone manufacturers to move towards high-end. Recommended focus: GABRIELLE, LANGHONG TECHNOLOGY, TGGF. Artificial Intelligence Promotes the Renewal of Home Appliance Products In 2024, among the top 10 AI product sales in various categories of mainstream electrical appliances on major e-commerce platforms, there is a significant difference in sales between categories. Major appliances lead with sales of 6.05 billion yuan. Overall, the sales performance of major appliances on e-commerce platforms is stronger, reflecting consumers' higher attention and demand for such smart appliances. Smart home uses Internet of Things technology to connect various home appliances, home systems, and smart terminals, enabling interconnection and collaboration among devices. This intensifies the cooperation and competition between the home appliance industry and the technology industry. Recommended focus: GVS. Risk warnings: 1) Policy risks; 2) Liquidity risks; 3) Corporate profits falling below expectations.