AI Reconstructs Moat of Paid Sports Information Services: Decoding Underlying Logic of Crazy Sports (0082.HK)'s Counter-trend Growth
In the wave of accelerated restructuring of the global sports industry in 2024, China's sports economy is writing a new chapter with unique resilience. This year, the State Council included the sports industry in the cultivation list of new-quality productive forces, and policy dividends combined with technological revolution are driving the industry's transformation from "scale expansion" to "value reconstruction".
How to actively grasp industry trends and translate the "imagination" of new-quality productive forces into enhancing enterprise "value" has become the core proposition for Chinese sports industry chain enterprises.
Coinciding with the recent release of the 2024 financial report by Crazy Sports, a leading domestic digital sports entertainment operator and internet sports industry leader, the report reflects not only the growth trajectory of a single enterprise but also the epitome of the entire industry's exploration of the second growth curve in the intelligent era.
In essence, the Group's annual report serves as an observation window to decode the triple resonance effect of technological empowerment, consumption upgrading, and policy orientation.
I. Paid Sports Information Services Achieve Counter-trend Growth, with AI Technology Reshaping the Content Ecosystem Moat
The financial report shows that Crazy Sports' 2024 revenue reached HKD 411.4 million. Although it decreased year-on-year, the Group achieved a significant reduction in losses, with the annual loss narrowing to HKD 14.7 million, a year-on-year decrease of 32.2% compared to last year's HKD 21.7 million.
What particularly catches the author's attention is that the revenue of the paid sports information platform reached HKD 259 million, a year-on-year increase of 13.7%, accounting for 62.9% of the total revenue, rapidly rising from 46.4% in the same period last year, and becoming its core growth engine.
This achievement benefits from two strategic breakthroughs:
On the one hand, the Group deeply integrates AI technology into vertical scenarios. In June last year, relying on 20 years of data on events, user behavior, and expert analysis methods, the Group officially launched the new AI assistant "Ruyi". As China's first large model in the "Sports + Lottery" field, "Ruyi" can provide users with personalized dialogue experiences such as answering questions, organizing materials, screening events, and analyzing recommendations.
On this basis, the Group has also created a lottery assistant tool that significantly improves users' betting decision-making efficiency through real-time odds analysis, team strength evaluation, and historical trend prediction. This has received unanimous praise from the market and users, providing a solid foundation for improving the monthly active users, user retention rate, and paid conversion rate of the company's Crazy Red Insights APP.
On the other hand, the Group has strengthened content ecosystem construction and actively expanded internationally.
The underlying logic here is that the foundation of knowledge-based paid services is user attention, and the key to attracting user attention lies in content. To continuously optimize content ecosystem construction, the Group has launched a creator assistant tool to help creators enrich their content more efficiently.
Meanwhile, its paid sports information products were officially launched in overseas markets, with operations first starting in Southeast Asia. Differentiated functions such as real-time score updates and AI prediction models are being used to enter the local market. Data shows that overseas users have given positive feedback on the depth and response speed of data analysis, laying the foundation for subsequent global expansion.
The Group's ability to achieve technological leaps and content innovation is inseparable from its continuous increase in R&D investment. Data shows that the amortization of intangible assets included in the cost of revenue in 2024 increased by 12.1% compared to 2023, reaching approximately HKD 34.7 million, mainly due to increased investment in R&D assets. It is precisely this continuous increase in R&D investment that has transformed into technological barriers, helping the Group build a full-chain digital capability covering event prediction, live interactive, and creation tools, creating a generational gap with traditional sports information platforms.
II. Event Operations Activate Brand Potential, with "Sports+" Creating New Consumption Scenarios
While empowering core businesses with technology, the Group has also deeply integrated the synergistic effects of "Digital + Sports" with the ecological advantages of "Digital + Entertainment". By integrating IP events, digital tools, and cultural tourism resources, it has built a three-dimensional operation chain of "traffic entrance - immersive experience - scenario consumption", opening up new battlefields for the release of cross-border integration value in the sports industry.
This not only lays the foundation for its value growth but also, as the Group continues to deepen its event operations layout, is expected to open up a second growth curve. The financial report shows that during the reporting period, its sports event operations business grew from scratch, achieving revenue of HKD 7.5 million.
In 2024, the Group capitalized on a combination of "sports IP event + traffic operations" to transform offline activities into brand assets and revenue increments. The China Foshan WBC Professional Boxing Championship set a new record for Chinese professional boxing viewership with over 300 million views, while the Yellow Duck Happy Run series created sports-tourism integrated consumption scenarios in places such as the Summer Resort and Foshan Danzao through the "Sports + Cultural Tourism" model.
This layout aligns with both policy and market logic:
First, sports event traffic is spread through platforms like Douyin, reaching a broad sports user base. As the operator, the Group can effectively achieve brand exposure during events through live broadcasts and highlight clips, thus deeply planting its brand in the minds of viewers. As users' demand for professional services such as sports analysis tools and betting strategies increases, they will naturally transition from general entertainment viewers to consumers in vertical fields.
This content-driven, platform-channeled traffic circulation system bridges the gap between mass sports entertainment needs and professional service supply, constructing an online-offline integrated business ecosystem that feeds back into its online knowledge-based paid services and lottery business.
Second, local government support for "sports event economy" (such as Foshan local government's resource allocation for the WBC event) provides policy dividends for commercialization. The underlying logic is that, on the one hand, government support in areas such as venue provision, public safety, and transportation directly reduces the fixed costs of event implementation, allowing the Group to focus more resources on content innovation and user experience improvement. On the other hand, the credibility provided by policy endorsements significantly enhances the attractiveness of events to commercial sponsors and cross-border cooperation institutions, forming an ecological cycle of "government sets stage - enterprises perform - multi-parties achieve win-win outcomes".
The financial report shows that the Group’s sales and marketing expenses decreased by 20.7% year-on-year in 2024, but its brand influence has grown exponentially, which also indirectly verifies the effectiveness of its asset-light operation model.
III. Policy Dividends and AI Revolution Resonate, Positioning in the 5-Trillion Sports Industry Gold Track
From a macro perspective, Crazy Sports is at the intersection of multiple favorable factors.
On the policy front, the State Council's "National Fitness Program (2024-2026)" clearly proposes to cultivate new forms of sports service consumption. China’s 12 departments including the General Administration of Sport jointly issued the "Guiding Opinions on Promoting Sports to Assist Rural Revitalization Work", requiring full coverage of county-level national fitness centers by 2025. The policy emphasizes the expansion of county and rural markets, and Crazy Sports' business model, which covers over 100 million users through knowledge-based paid products, has a natural fit with the sports service needs of the sinking market.
Furthermore, as China's strategy of "building a leading sports powerhouse" enters uncharted waters, the difference between the total scale of the sports industry in 2023 (RMB 3.67 trillion) and the 2025 target (RMB 5 trillion) provides structural growth support for Crazy Sports' core business.
Technically, driven by AI, technological iteration is reconstructing the sports industry value chain. the "Ruyi" large model has established a first-mover advantage, with its uniqueness lying in the deep accumulation of vertical field data - its 20-year historical event database has a higher granularity than the industry average, and this technological barrier is being transformed into commercial value.
Notably, the Group plans to introduce a multimodal data analysis system in 2025 to optimize the accuracy of event recommendations, aligning with the AI event analysis system path of international giants such as Sportradar. Currently, the U.S. sports data analysis provider Sportradar has a valuation exceeding USD 8 billion thanks to its AI event prediction system. If more business breakthroughs driven by AI were achieved in the future, how will the secondary market react?
It can be envisaged that with the introduction of multimodal technology, the planned "data collection - intelligent analysis - personalized push" closed loop will have significant room for technological dividend release, potentially breaking through the bottleneck of homogeneous traditional sports content and becoming the underlying infrastructure for sports data services.
From a market opportunity perspective, the commercial value of top events is accelerating under their catalysis. The 2025 FIFA Club World Cup will be upgraded to a 32-team format, and according to FIFA President Gianni Infantino, it is expected to attract 5 billion viewers globally, with high commercial value.
Given that major events have historically driven significant increases in users and revenue, Crazy Sports is actively seizing these opportunities. It is expected to utilize its existing content and prediction tools to leverage user value through the "traffic - conversion - retention" funnel. This "content + tool" dual-wheel drive model creates a differentiated competitive advantage compared to peers.
At the critical point of industrial transformation, the three-dimensional layout of "technology + content + scenario" has given it a first-mover advantage in the sports industry digitalization wave. If it makes breakthroughs in areas such as promoting the open-source cooperation of AI models (similar to Google TensorFlow's application in sports data analysis) and participating in smart sports city pilot projects in the future, the Group is expected to successfully transform its technological potential into ecological advantages.
By then, it is expected to further open up valuation reconstruction space in the new round of industrial digitalization wave and become a new model for Chinese sports technology going global.
IV. Conclusion
As a typical case of digital transformation in China's sports industry, Crazy Sports' practices reveal the paradigmatic transformation of traditional industries empowered by technology. Its exploration of reconstructing knowledge service ecosystems with AI large models and activating scenario consumption with IP events demonstrates the value reconstruction logic of new-quality productive forces for the industry.
This also reflects the deep transformation of China's sports economy: driven by both policy and technological revolution, the industry is shifting from resource-dependent growth to innovation-driven development. Enterprises need to not only deepen their professional barriers in vertical fields but also possess the ability for ecological integration, organically linking digital infrastructure, cultural symbols, and commercial scenarios to form a sustainable value creation system.
In this regard, its development path based on technological innovation and ecological construction may provide an Eastern solution for the global sports economy transformation.
