Phancy Group Co., Ltd. Issues Voluntary Clarification on Market Speculation Amidst Share Price Volatility

Hong Kong, 24 February 2026 — Phancy Group Co., Ltd. (formerly known as Beijing Fourth Paradigm Technology Co., Ltd., Stock Code: 6682), a leading provider of AI-driven computing power services, has released a voluntary clarification announcement in response to recent market speculation and a notable decline in its share price.

Key Points Highlighted in the Announcement

• Sharp Share Price Decline: The Board has observed a significant drop in the Company’s share price, which appears to be triggered by market speculation regarding the impact of large language model (LLM) advancements on existing business models in the software industry.
• Market Concerns Addressed: The speculation suggests that rapid developments in LLMs could potentially disrupt or replace current business models in the sector, creating uncertainty about the future prospects of both the industry and Phancy Group in particular.
• Business Model and Revenue Structure: The Company emphasized that its primary business is centered on computing power services, which precisely benefits from the increasing demand driven by LLM advancements. For the nine months ended September 30, 2025, a substantial 83.9% of the Group’s revenue was derived from computing power-related services, with only 16.1% coming from traditional software services.
• Strong Financial Performance: The Group’s revenue for January–September 2025 surged by 36.8% year-on-year. Importantly, the Company achieved quarterly profitability for the first time in Q3 2025, reflecting strong operational execution and significant benefits from AI industry growth.
• Business Outlook and Opportunities: The rapid iteration and adoption of large language models have resulted in a substantial increase in market demand for computing power, opening up new opportunities for Phancy Group’s core business. The Group serves enterprise clients across various industries, supporting their digital transformation and AI enablement efforts.
• Operational Status and Disclosure: After thorough inquiry, the Board confirms that the Group’s business operations remain normal. As of the date of the announcement, there is no inside information that requires disclosure but has not yet been made public.

Potentially Price-Sensitive Information for Shareholders

• Market Positioning: Despite concerns about AI advancements disrupting traditional software businesses, Phancy Group’s revenue is overwhelmingly tied to computing power provision—a segment that stands to benefit directly from AI and LLM developments rather than being threatened by them.
• Growth Trajectory: The Company’s significant revenue growth and first-ever quarterly profitability in Q3 2025 demonstrate operational resilience and the ability to capture value from AI industry trends.
• No Undisclosed Inside Information: The Company has stated clearly that there is no undisclosed inside information, which may help reassure investors worried about unexpected negative news.
• Investment Caution: The Board advises shareholders and potential investors to exercise caution when dealing in the Company’s securities, given recent market volatility and ongoing speculation.

Board Composition Update

As of the date of the announcement, the Board comprises:

• Executive Directors: Dr. Dai Wenyuan (Chairman), Mr. Chen Yuqiang, Mr. Yu Zhonghao
• Non-executive Directors: Dr. Yang Qiang, Mr. Dou Shuai, Mr. Zhang Jing
• Independent Non-executive Directors: Mr. Li Jianbin, Mr. Liu Chijin, Ms. Ke Yele, Mr. Pan Jialin
• Employee Representative Director: Mr. Chai Yifei

Conclusion

Phancy Group’s latest clarification aims to address investor concerns by highlighting the Company’s strong alignment with AI industry growth, robust financial results, and the absence of any negative undisclosed information. With the core business centered on computing power, the Group is positioned to benefit from the very technological trends that are causing anxiety among investors. Nevertheless, caution is advised when trading the Company’s shares given recent volatility and market sentiment.

Disclaimer: The content above is for informational purposes only and does not constitute investment advice. Investors should consider their own circumstances and consult with professional advisors before making any investment decisions. The Company’s share price may remain volatile in the short term due to ongoing market speculation and external factors.

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