In 2023, the average selling price of a projector was around 3,200 yuan. However, by the first half of 2024, the price had plummeted to around 1,700 yuan. As the "leader" in projectors, Jimi Technology's profit margins naturally came under pressure. Nevertheless, to compete, Jimi Technology had no choice but to compete on low prices.

Projectors are no longer selling, and "leader" Jimi Technology can no longer hold on.

On the evening of August 29, Jimi Technology disclosed its half-year report for 2024. The data showed that Jimi Technology generated revenue of 1.6 billion yuan in the first half of the year, a decrease of 1.66% year-on-year. Net profit attributable to shareholders amounted to 4.1 million yuan, a significant decline of 95.58% from 92.7273 million yuan in the same period last year.

Jimi Technology reached its peak performance in 2022, generating revenue of 4.222 billion yuan and net profit attributable to shareholders of 516 million yuan. In 2023, however, its net profit plummeted by 76% to 121 million yuan.

Since its listing on the capital market in March 2021, Jimi Technology's share price has risen steadily due to its high growth potential, reaching an all-time high of 614.33 yuan per share in June. However, since then, the share price has declined due to factors such as slowing revenue growth. Compounded by intensifying market competition and an unfavorable industry environment, Jimi Technology's share price has continued to decline, setting new lows. Currently, the share price is down 90% from its peak, with a market value of only 3.718 billion yuan.

As Jimi Technology's share price continued to fall, its second-largest shareholder, the "Baidu group," began aggressively reducing its stake. The Baidu-affiliated companies holding shares in Jimi Technology are Beijing Baidu Netcom Science & Technology Co., Ltd. (hereinafter referred to as "Baidu Netcom") and Beijing Baidu Investment Management Co., Ltd. - Beijing Baidu Biwei Enterprise Management Center (limited partnership) (hereinafter referred to as "Baidu Biwei"). As concerted actors, these two Baidu-affiliated companies held a total of 5,090,976 shares in Jimi Technology. By the expiration of the reduction period on August 25, 2024, the Baidu group had reduced its stake in Jimi Technology by a cumulative total of 1,220,994 shares. Baidu Netcom attributed the reduction to its own funding needs, but undoubtedly, the reduction is closely related to Jimi Technology's performance.

"The leader in projectors" is in crisis

Founded in 2013, Jimi Technology surpassed numerous international brands to become the leading projector supplier in China's market in 2018, maintaining its top position in sales until 2023. Fueled by capital, Jimi Technology surpassed market leaders such as Epson, BenQ, Sony, and NEC within just ten years.

Capital can bring rapid growth but also rapid decline. Currently, Jimi Technology faces a double decline in revenue and net profit.

Although the entire projector market is currently experiencing a downturn, Jimi Technology's decline has far exceeded the industry average. According to IDC data, China's projector market shipped 4.736 million units in 2023, a year-on-year decrease of 6.2%, with sales of 14.77 billion yuan, down 25.6% year-on-year.

Based on these figures, the average selling price of a projector in 2023 was around 3,200 yuan. However, by the first half of 2024, data from Runto Technology revealed that the total market sales volume reached 2.889 million units, up 3.5% year-on-year, with sales of 4.76 billion yuan, down 10.2% year-on-year.

Calculating these figures, the average selling price of a projector in the first half of 2024 was less than 1,700 yuan. Over six months, the price decline of projectors was significant, directly impacting Jimi Technology's profit margins.

Faced with declining profit margins, Jimi Technology chose to "go with the flow." The company officially stated that it was currently launching products covering a wider range of price points, including those priced below 2,000 yuan.

At the same time, to avoid persistent low-price competition and internal strife, Jimi Technology has also set its sights on overseas markets. As of the first half of 2024, Jimi Technology generated overseas revenue of 448 million yuan.

Apart from the unfavorable external industry conditions, Jimi Technology also faces issues such as high marketing expenses and a lack of product diversity.

The "Baidu group" is aggressively reducing its stake

Robin Li's "Baidu group" continues to sell off its stake in Jimi Technology.

Before reducing its stake, Baidu Netcom and Baidu Biwei held a cumulative total of 5,805,300 shares in Jimi Technology, corresponding to a shareholding ratio of 11.61%, all acquired through pre-IPO financing and capital reserve conversions.

However, since the lifting of restrictions on Jimi Technology's shares in March 2022, the "Baidu group" has frequently reduced its stake. In March 2022, Baidu Netcom and Baidu Biwei planned to reduce their stake by no more than 2,139,700 shares within a specific period, corresponding to a reduction of no more than 4.28%. In June 2022, they announced plans to reduce their stake by no more than 2,100,000 shares, or 3% of the total shares.

In March 2023, the "Baidu group" announced another reduction plan. Baidu Biwei planned to reduce its stake by no more than 583,600 shares, or 0.83% of the total, within three months.

In May 2024, Baidu Netcom planned to reduce its stake by no more than 1,859,300 shares, corresponding to a reduction of 2.66%, while Baidu Biwei planned to reduce its stake by 240,700 shares, or 0.34%.

Specifically, from March 2022 to May 2023, Baidu Netcom reduced its stake by a cumulative total of 1,277,100 shares, corresponding to a reduction of 2.55%, while Baidu Biwei reduced its stake by 222,900 shares, or 0.45%.

From July to August 2022, Baidu Netcom reduced its stake by 623,000 shares, or 0.89%, and Baidu Biwei reduced its stake by 312,000 shares, or 0.45%.

Between early May and May 28, 2024, Baidu reduced its stake by 0.66%. From May 29 to June 17, Baidu Netcom's shareholding ratio fell from 6.03% to 5.04%, while Baidu Biwei's shareholding ratio fell from 0.58% to 0.49%.

As of June 18, 2024, the shareholding ratio of Baidu Netcom and Baidu Biwei had fallen from 11.61% before the lifting of restrictions to 5.53%. In other words, over two years, the "Baidu group" has reduced its stake in Jimi Technology by 6.08%.

Behind the frequent stake reductions are Jimi Technology's significant decline in performance and the continuous decline in its share price. On August 29, Jimi Technology's share price hit an all-time low of 50.71 yuan per share. Not only has it lost 90% of its value in three years, but it is also down 60% from its issue price of 133.73 yuan per share.

It seems that the "Baidu group" has not gained much by frequently reducing its stake and cashing out.