How will AsiaInfo address the pressure on order prices in its traditional business?

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AsiaInfo Technologies to Expedite Business Negotiations to Counter Order Price Pressure

AsiaInfo Technologies plans to accelerate the negotiation process for its Business Support Systems (BSS) orders to mitigate the adverse effects of declining order prices and delayed signings. The company aims to leverage technological advancements, such as those driven by "AI+" and "LLM+", to foster joint research and development with clients. This strategic approach is intended to preserve the leading position of its BSS business within the telecommunications sector and is projected to significantly narrow the rate of revenue decline for BSS for the full year.
Accelerating BSS Order Negotiations

The company is implementing measures to expedite the negotiation phase for its BSS orders. This initiative is a direct response to the challenges encountered in the first half of 2024, which included a complex and uncertain external business environment. Corporate customer budgets across industries have generally tightened, and the telecommunications sector, in particular, has experienced a slowdown in growth and a significant push for cost reduction by operators. These factors have led to downward pressure on order prices and increased difficulties in finalising deals, contributing to substantial delays.
Leveraging Technological Advancements

AsiaInfo Technologies intends to capitalize on emerging technological upgrades, specifically mentioning "AI+" and "LLM+". By actively engaging in joint research and development with its customers, the company seeks to integrate these new technologies into its offerings. This collaborative effort is designed to ensure that AsiaInfo Technologies maintains its competitive edge and leadership in the BSS segment of the telecommunications industry, adapting to evolving market demands and technological landscapes.
Narrowing Full-Year Revenue Decline

The company anticipates that these strategies will lead to a notable reduction in the rate of decline for its BSS business revenue over the entire fiscal year. Despite a 18.1% year-on-year decrease in revenue from BSS and other traditional businesses to RMB1,794 million in the first half of 2024, and an overall operating revenue drop of 8.8% to RMB2,994 million, the outlook for the latter half of the year is more optimistic. This projected improvement is crucial for offsetting the pressures experienced earlier in the year and achieving better full-year financial results than the previous year.

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How will AsiaInfo address the pressure on order prices in its traditional business?

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