Datasea Enters into New Sales Agreements for its 5G AI Communications and High Tech Acoustic Segments Expecting $62 Million in Sales

Rhea-AI Summary

Datasea has announced three significant sales agreements totaling $61.7 million, aimed at boosting revenue for fiscal year 2025. The deals involve two agreements in the 5G AI communications segment and one in high-tech acoustic products. The first two agreements, signed with Shenzhen Juhaowan Technology and Shenzhen Yuzhongqing Technology, are valued at up to $30 million each, for 5G multimodal communication delivery services. The third agreement, with Tianjin Qianli Culture Communication, is valued at $1.7 million for the supply of approximately 20,000 units of high-tech acoustic products by December 31, 2024. CEO Liu Zhixin highlighted the growing traction of their 5G AI and acoustic product lines in the marketplace.

Positive

• Secured three new sales agreements totaling $61.7 million.
• Two agreements in the 5G AI communications segment worth up to $60 million.
• One agreement in the high-tech acoustic products segment valued at $1.7 million.
• Expected revenue boost for fiscal year 2025.
• Growing traction in the 5G communications and healthy living marketplaces.

Negative

• None.

Insights

Financial Analyst

Datasea's recent sales agreements signal a substantial revenue boost for the company. Securing $61.7 million in sales, predominantly from its 5G AI multimodal communication services, demonstrates significant market demand for its products. A key takeaway here is the diversification of their revenue streams, with two agreements each contributing $30 million over 12 months from 5G AI services and the third agreement adding $1.7 million from acoustic products. This diversification could help mitigate risks associated with dependency on a single revenue source.

In the short-term, this influx of orders is likely to enhance Datasea's cash flow and profitability, providing immediate financial relief and potentially improving the company's stock performance. In the long-term, these agreements could bolster market confidence and enable further investments in R&D, potentially leading to more innovative products and sustained growth. However, the execution risk remains—ensuring timely delivery and maintaining product quality will be important to converting these agreements into lasting business relationships.

Tech Expert

The agreements highlight Datasea's growing influence in the 5G and AI technology sectors. The recurring theme in these deals is the emphasis on multimodal communication, which integrates various communication methods, enhancing user experience by providing seamless interactions across different platforms. This is a cutting-edge technology that not only helps businesses to operate more efficiently but also offers end-users a more integrated and responsive service.

From an industry perspective, Datasea’s focus on 5G multimodal communications aligns with current trends where enterprises are increasingly adopting advanced communication tools to stay competitive. The company’s dual focus on high-tech acoustics is also noteworthy. Products like the 'Tianer' and 'Star Sleep' cater to the rising consumer demand for health and wellness technologies, indicating a smart market positioning.

These strategic moves can solidify Datasea's reputation as a tech innovator and pave the way for future technological advancements. Nevertheless, keeping up with rapid technological changes and ensuring the scalability of their solutions will be ongoing challenges.

Market Research Analyst

Datasea's successful negotiation of these sales agreements reflects a deep understanding of market needs in both the 5G AI communication and high-tech acoustic segments. The agreements with companies like Juhaowan and Yuzhongqing show that Datasea is effectively targeting firms in the Internet services sector, which are reliant on robust communication technologies to enhance their service offerings.

The agreement with Qianli Culture for the 'Tianer' and 'Star Sleep' products indicates a strategic move into the health and wellness market, which has been experiencing substantial growth. This market shift towards health-conscious products could open new revenue channels and help diversify their product portfolio. Additionally, leveraging AI in these products could provide a competitive edge by offering features that are more advanced and personalized than those of competitors.

However, the sustainability of this growth will hinge on Datasea's ability to consistently meet market expectations and innovate within these domains. Establishing a strong brand presence and ensuring consumer satisfaction will be critical factors in maintaining their market share.

The Three Agreements Support Continued Fiscal Year 2025 Revenue Growth for its Core AI-Based Businesses

BEIJING, July 1, 2024 /PRNewswire/ -- Datasea Inc. (NASDAQ: DTSS) ("Datasea" or the "Company"), a Nevada corporation engaged in innovative businesses in high-tech intelligent acoustics and 5G-Artificial Intelligence ("AI") multimodal communication technology in the United States and China, today announced three new sales agreements with its subsidiaries in China. If the parties to these agreements that total approximately $61.7 million that encompass two agreements for its 5G-AI communications segment, and one agreement for its high tech acoustic products segment.

Ms. Liu Zhixin, CEO of Datasea, commented, "We are pleased to enter into the new agreements as they are expected to increase new customer orders for both our 5G AI communications and acoustics products segments. We believe that both of our businesses are beginning to gain excellent traction due to their high value in the 5G communications and healthy living marketplaces. In addition, we are confident that the two segments' core AI functionality will drive further technological innovation and increased market share."

Datasea's three new sales agreements are as follows:

• On May 15, 2024, the Company's Guozhong Haoze subsidiary signed a 5G AI Multimodal Communication Agreement with Shenzhen Juhaowan Technology Co., Ltd. ("Juhaowan"), an online lifestyle services and application service provider. According to the agreement, Juhaowan can purchase 5G multimodal communication delivery services from Guozhong Haoze over the course of 12 months that have an estimated total value of up to $30 million.
• On May 13, 2024, the Company's Heilongjiang Xunrui subsidiary signed a 5G AI Multimodal Communication Agreement with Shenzhen Yuzhongqing Technology Co., Ltd. ("Yuzhongqing "), a firm primarily engaged in internet and related services. According to the agreement, Yuzhongqing can purchase 5G multimodal communication delivery services from Heilongjiang Xunrui over the course of 12 months that have an estimated total value of up to $30 million.
• On June 8, 2024, the Company's Shuhai Jingwei subsidiary entered into an Acoustic Products Sales Agreement with Tianjin Qianli Culture Communication Co., Ltd. ("Qianli Culture"), an internet promotion and marketing service provider, for the Company's acoustic high tech products. According to the agreement, Qianli Culture will purchase a total of approximately 20,000 units of the company's "Tianer" and "Star Sleep" branded products, including air disinfection machines, restroom deodorization and disinfection devices, and sleep aids, by December 31, 2024; the total contract amount is approximately $1.7 million.

About Datasea Inc.

Datasea Inc. ("Datasea") is a leading provider of products, services, and solutions for enterprise and retail customers in innovative industries, Intelligent Acoustics and 5G multimodal communication, especially focusing on ultrasonic, infrasound and directional sound technology. The Company's advanced R&D technology serves as the core infrastructure and backbone for its products. Its 5G multimodal communication segment operates on a cloud platform based on AI. Datasea leverages cutting-edge technologies in intelligent acoustics, utilizing ultrasonic sterilization to combat viruses and prevent human infections, and is also developing innovations in directional sound and medical ultrasonic cosmetology. In July 2023, Datasea established a wholly-owned subsidiary, Datasea Acoustics LLC, in Delaware, in a strategic move to mark its global presence. This underlies Datasea's commitment to Intelligent Acoustics and its intent to offer leading edge acoustic solutions to the US market. For additional information, please visit: www.dataseainc.com.

Cautionary Note Regarding Forward-Looking Statements 

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will", "expects", "anticipates", "future", "intends", "plans", "believes", "estimates", "target", "going forward", "outlook," "objective" and similar terms. Such statements are based upon management's current expectations and current market and operating conditions, and relate to events that involve known or unknown risks, uncertainties and other factors, all of which are difficult to predict and which are beyond Datasea's control, which may cause Datasea's actual results, performance or achievements  (including the RMB/USD value of its anticipated benefit to Datasea as described herein) to differ materially and in an adverse manner from anticipated results contained or implied in the forward-looking statements. Further information regarding these and other risks, uncertainties or factors is included in Datasea's filings with the U.S. Securities and Exchange Commission, which are available at www.sec.gov. Datasea does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under law.

Investor and Media Contact: 

Datasea Inc. Investor relations
Email:  investorrelations@shuhaixinxi.com
            sunhezhi@shuhaixinxi.com 

Precept Investor Relations LLC
David Rudnick
+1 646-694-8538
david.rudnick@preceptir.com

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SOURCE Datasea Inc.

FAQ

What is the total value of Datasea's new sales agreements announced on July 1, 2024?

The total value of Datasea's new sales agreements is $61.7 million.

Which companies are involved in Datasea's new 5G AI communications agreements?

Datasea's 5G AI communications agreements are with Shenzhen Juhaowan Technology and Shenzhen Yuzhongqing Technology.

How much is the agreement with Shenzhen Juhaowan Technology worth?

The agreement with Shenzhen Juhaowan Technology is worth up to $30 million.

What is the value of the agreement between Datasea and Shenzhen Yuzhongqing Technology?

The agreement with Shenzhen Yuzhongqing Technology is valued at up to $30 million.

What products are included in Datasea's agreement with Tianjin Qianli Culture Communication?

The agreement includes approximately 20,000 units of 'Tianer' and 'Star Sleep' branded acoustic products.

How much is Datasea's acoustic products agreement with Tianjin Qianli Culture Communication worth?

The agreement is worth approximately $1.7 million.

When was Datasea's agreement with Tianjin Qianli Culture Communication signed?

The agreement was signed on June 8, 2024.

What is the expected revenue impact of Datasea's new sales agreements?

The new sales agreements are expected to support revenue growth for fiscal year 2025.

What segment of Datasea's business does the $1.7 million agreement pertain to?

The $1.7 million agreement pertains to Datasea's high-tech acoustic products segment.

What is the stock symbol for Datasea?

The stock symbol for Datasea is DTSS.