YIDU TECH (02158) held an investor day on August 13, drawing participation from analysts at Goldman Sachs, Citigroup, CITIC Securities, CSC Financial, HSBC, GF Securities, and institutional investors including E Fund and Boyu Capital. The company's management, including Co-founder and CEO Xu Jiming and CFO Feng Xiaoying, addressed key market concerns such as order growth, earnings sustainability, medical AI commercialization progress, and shareholder returns.

Key inflection point marks shift from investment to value delivery

Management highlighted that FY26 represents a critical inflection point in the company's development. For the first time, YIDU TECH achieved full-year profitability, driven by revenue growth, gross margin expansion, and improved operational efficiency. This signals a transition from a prolonged "capability investment phase" into a "commercialization realization phase."

AI products enter commercialization phase, driving order momentum

Order growth and AI commercialization were among the most discussed topics. The company noted that hospitals are accelerating their shift from traditional project-based models to productized, platform-based, and intelligent agent-based systems. AI-native products like Doctor Copilot, the medical AI middle platform, and Yidu Smart Evidence are gaining traction in hospitals. In the past fiscal year, YIDU TECH deployed AI middle platforms in over 50 large hospitals, with some also adopting the Copilot platform. Pilot projects that have been validated are now progressing to tender bidding and commercial procurement stages.

In the AI for Life Sciences segment, new orders and backlog from the previous fiscal year are gradually being realized. Leveraging its data processing technology and AI capabilities, the company has expanded into clinical trial protocol design, patient recruitment, and intelligent quality control. Nearly 100 research hospitals in China have deployed its intelligent GCP platform. In some clinical research scenarios, AI-assisted patient recruitment can accelerate the process by 30% to 50%.

Xu Jiming emphasized that the company will not rely on low pricing to win projects. Instead, it will continue to focus on key disease areas, integrating hospital data infrastructure, disease intelligence, and clinical R&D capabilities. By productizing and applying AI, YIDU TECH aims to enhance project execution efficiency and customer value.

From turning profitable to accelerating growth, sustainability becomes core focus

For FY26, YIDU TECH reported revenue of approximately RMB 820 million, up about 15% year-on-year. Annual net profit reached nearly RMB 80 million, with attributable net profit of about RMB 73 million, both exceeding the upper end of the profit alert guidance. Adjusted EBITDA reached RMB 220 million, 5.6 times the previous year's level, while overall gross margin improved from 33.5% to 36.4%.

Cash flow and operational efficiency also improved. In the second half of the fiscal year, net operating cash flow turned positive, reaching RMB 29.3 million, with a notable improvement in net working capital turnover. Management attributed these improvements to enhanced product strength, optimized receivables management, and the ongoing application of AI in R&D, delivery, and internal management processes, boosting both human and cost efficiency.

For FY27, management clarified that the company is not entering a "low-speed stable period" after profitability. Instead, it is in a "stable growth phase supported by profits." Future growth will come from three main areas: increased revenue contribution from AI-native products in hospitals, gradual release of backlog in AI for Life Sciences, and steady growth in AI for Care scenarios like city-customized insurance (Huimin Bao) and chronic disease management. As high-margin AI products increase their share and marginal costs decline through scaled replication of flagship products, the company expects continued steady improvement in revenue, gross profit, and net profit.

Strong cash reserves support R&D investment and shareholder returns

Beyond business growth, capital allocation and shareholder returns were key topics. As of the end of FY26, the company held approximately RMB 3.3 billion in net cash, providing a solid foundation for sustained R&D investment, business expansion, and shareholder returns. Management stated that it will maintain a prudent capital allocation strategy, focusing on R&D that strengthens core competitiveness and investment opportunities with clear synergies to existing operations.

YIDU TECH has also strengthened shareholder returns. The company previously proposed its first final dividend and continues to execute share repurchases. As of now, it has repurchased approximately 42.69 million shares in 2026, with treasury shares accounting for nearly 5% of total equity, a high level among peers. Management indicated that it will continue to prudently pursue capital allocation within compliance frameworks, considering operating conditions, long-term development needs, and market valuations. This will be achieved through business growth, dividends, and share repurchases to enhance long-term shareholder returns.

Medical AI is a big variable but a slow-moving one

Facing intensifying competition in medical AI, YIDU TECH stated that the field is a "big variable" but also a "slow variable." Rather than chasing traffic and application volume, the company will continue to focus on the accuracy, professional depth, and clinical value of disease decision-making. It will validate products through top-tier hospitals, specialized departments, and leading experts before replicating them across broader medical scenarios.

In conclusion, management summarized that FY26 validated the pathway from years of capability accumulation to commercial value realization. Looking ahead, the company will focus on order conversion, AI product penetration, gross margin improvement, profit growth, and operating cash flow enhancement. The goal is to move medical AI from proof-of-concept scenarios to larger-scale commercial deployment, rewarding long-term investor trust with sustained, high-quality operational growth.