Profitability Analysis and Improvement Recommendations for Teamsun Technology (600410)

Based on the collected data, I provide you with a systematic analysis of the current profitability status and improvement recommendations for Teamsun Technology.

---

Indicator	Teamsun Technology (2024)	Industry Average	Gap
Consolidated Gross Profit Margin	12.09%	~25%	-12.91pp
Net Profit Margin	3.05%	~9.2%	-6.15pp
ROE	7.83%	~12-15%	-4.17pp
Operating Revenue	RMB 4.22 Billion	-	-

Teamsun Technology’s gross profit margin of 11.86% is indeed lower than the industry average (approximately 25%), with a noticeable gap. The main reason for the low gross profit margin is closely related to the company’s business structure [0][1].

Business Segment	Revenue Proportion	Gross Profit Margin	Gross Profit Margin Contribution
Enterprise IT System Solutions	78.4%	9.62%	7.54%
Cloud Computing Products and Services	21.6%	21.01%	4.54%
Total	100%	12.09%	12.09%

From the perspective of business structure,

, which significantly drags down the overall gross profit margin. In contrast, the cloud computing business has a gross profit margin of 21.01%, which is a bright spot in the company’s profitability [1].

As can be seen from the chart above:

• Gross Profit Margin
  : Gradually increased from 8.92% in 2020 to 12.09% in 2024, showing a continuous improvement trend
• Net Profit Margin
  : Significantly improved from -6.08% in 2020 to 3.05% in 2024, turning losses into profits
• ROE
  : Increased from -12.35% in 2020 to 7.83% in 2024, with the return capability for shareholders gradually recovering [0][1]

• The IT system solutions business is mainly focused on hardware integration and project implementation, with relatively low added value
• Labor costs and project delivery costs account for a relatively high proportion, compressing profit margins
• The company’s major clients are government, financial institutions, and operators, resulting in relatively weak bargaining power

• The software and IT service industry is highly competitive, with leading enterprises such as Kingsoft Office (gross profit margin of approximately 70%) and Yonyou Network (gross profit margin of approximately 40-50%) having higher gross profit levels
• Teamsun Technology’s brand premium capability in segmented fields needs to be enhanced

• The operating cost ratio reached 87.91% in 2024, resulting in significant cost control pressure
• Labor costs and project management expenses are the main components of costs

Improvement Direction	Specific Measures	Expected Effect
Expand Cloud Computing Business	Increase layout of AI computing power and intelligent computing centers	Cloud computing has a gross profit margin of 21%, higher than the overall level
Develop High-Value-Added Services	Increase the productization rate of software and add consulting service revenue	Target gross profit margin increased to 25%+
Control Scale of Low-Gross-Margin Businesses	Moderately shrink inefficient projects and improve project quality	Reduce projects with gross profit margin <5%

According to the company’s 2025 core “AI +” strategy [2]:

• Intelligent Operation and Maintenance Solutions
  : Adopt the dual-core architecture of “DeepSeek Intelligent Engine + Intel Arc Graphics Card”, reducing local AI inference costs to less than 30% of the original solution
• AI Smart Park Solutions
  : With multimodal large model technology as the core, realize “one model drives full-scenario intelligence”
• Computing Power Infrastructure
  : Focus on the construction of intelligent computing centers (benchmark projects such as Tianjin 300P computing power, Suzhou Guochuang Intelligent Computing Center, etc.)

• Cost Reduction and Efficiency Improvement
  : Improve the customer credit system, strengthen account period management, and shorten the payment collection cycle
• Lean Operation
  : Improve inventory turnover efficiency through accurate demand forecasting and optimized procurement planning
• Technology Upgrade
  : Increase R&D investment, improve product standardization, and reduce marginal costs

• Deepen Engagement in High-Gross-Margin Industries
  : High-value-added fields such as fintech and energy digitalization
• Enhance Customer Stickiness
  : Transform from project-based to long-term service-based models to increase recurring revenue
• International Expansion
  : Use Hong Kong subsidiary ASL (0771.HK) to expand overseas markets

• Spin off U.S. cloud computing company GDI for listing on Nasdaq (valuation of USD 398 million, representing a 237% increase from the acquisition price)
• Early-stage industrial investments have entered the harvest period: Telink Microelectronics (688591.SH), HyperStrong, E-Town Semiconductor, etc. have successively launched IPOs [2]

Indicator	2024 Status	2025 Target	2026 Target
Consolidated Gross Profit Margin	12.09%	15%+	18%+
Net Profit Margin	3.05%	5%+	7%+
ROE	7.83%	10%+	12%+
Proportion of Cloud Computing Business	21.6%	30%+	40%+

Teamsun Technology’s gross profit margin of 11.86% is lower than the industry average, mainly due to the high proportion of low-gross-margin IT solutions business in its business structure. However, the company’s profitability has been continuously improving:

1. Positive Factors
   : Gross profit margin has increased for 4 consecutive years, turned losses into profits in 2024, accelerated “AI +” strategic transformation, and computing power business has become a new growth driver
2. Improvement Path
   : Optimize business structure (increase the proportion of cloud computing), strengthen AI technology application, and improve operational efficiency
3. Investment Value
   : As a core partner of the Huawei Ascend Ecosystem, the company has a competitive edge in the AI computing power field. With the optimization of its business structure, its profitability is expected to continue to improve

It is recommended to continue to pay attention to the development progress of the company’s AI computing power business, changes in the proportion of cloud business revenue, and improvements in gross profit margin.

---

[0] Jinling API Financial Data - Annual Financial Analysis of Teamsun Technology (600410.SS)
[1] Teamsun Technology 2024 Annual Report - Gross Profit Margin Data of Main Business by Product
[2] Caifuhao - “Growth Miracle Amid AI Wave: Ten Rising Stars in the 2025 Third Quarterly Report” (https://caifuhao.eastmoney.com/news/20260111195649337567980)
[3] Caifuhao - “Driven by Computing Power + Ecosystem, Teamsun Technology Ushers in New Opportunities for Value Reassessment” (https://caifuhao.eastmoney.com/news/20260112233144807447190)