STAR CM (06698) issues a profit warning, expecting a net loss of approximately 1 to 1.25 billion yuan in 2025.

STAR CM (06698) announces that the group is expected to record a net loss of approximately RMB 100 million to RMB 125 million for the year ending December 31, 2025, compared to a net loss of approximately RMB 230 million in the same period of 2024. The expected reduction in net loss for the 2025 fiscal year is mainly due to the following reasons: the group's revenue remained stable in the 2025 fiscal year. By strengthening cost control measures and improving operational efficiency, the group achieved a higher gross profit margin compared to the same period last year. In 2024, the group recognized (a) impairment of goodwill due to the expected decrease in future film distribution rights income and (b) impairments of certain financial assets and long-term assets. Such significant impairments did not occur in the 2025 fiscal year. Due to ongoing cost optimization measures, the group's administrative expenses significantly decreased compared to the same period in 2024. Despite a significant reduction in losses, the group has still not turned a profit in the 2025 fiscal year. This is mainly due to the recognition of impairment provisions on properties held by certain associated companies, resulting in a significant change in the carrying value of these investments.