Latest news with #MicroAlgo
Yahoo
08-05-2025
- Business
- Yahoo
We Don't Think MicroAlgo's (NASDAQ:MLGO) Earnings Should Make Shareholders Too Comfortable
Investors appear disappointed with MicroAlgo Inc.'s (NASDAQ:MLGO) recent earnings, despite the decent statutory profit number. We did some digging and found some worrying factors that they might be paying attention to. Our free stock report includes 4 warning signs investors should be aware of before investing in MicroAlgo. Read for free now. As finance nerds would already know, the accrual ratio from cashflow is a key measure for assessing how well a company's free cash flow (FCF) matches its profit. In plain english, this ratio subtracts FCF from net profit, and divides that number by the company's average operating assets over that period. You could think of the accrual ratio from cashflow as the 'non-FCF profit ratio'. Therefore, it's actually considered a good thing when a company has a negative accrual ratio, but a bad thing if its accrual ratio is positive. While it's not a problem to have a positive accrual ratio, indicating a certain level of non-cash profits, a high accrual ratio is arguably a bad thing, because it indicates paper profits are not matched by cash flow. To quote a 2014 paper by Lewellen and Resutek, "firms with higher accruals tend to be less profitable in the future". For the year to December 2024, MicroAlgo had an accrual ratio of 0.45. That means it didn't generate anywhere near enough free cash flow to match its profit. Statistically speaking, that's a real negative for future earnings. In fact, it had free cash flow of CN¥29m in the last year, which was a lot less than its statutory profit of CN¥38.6m. Notably, MicroAlgo had negative free cash flow last year, so the CN¥29m it produced this year was a welcome improvement. Unfortunately for shareholders, the company has also been issuing new shares, diluting their share of future earnings. The good news for shareholders is that MicroAlgo's accrual ratio was much better last year, so this year's poor reading might simply be a case of a short term mismatch between profit and FCF. As a result, some shareholders may be looking for stronger cash conversion in the current year. Note: we always recommend investors check balance sheet strength. Click here to be taken to our balance sheet analysis of MicroAlgo. To understand the value of a company's earnings growth, it is imperative to consider any dilution of shareholders' interests. MicroAlgo expanded the number of shares on issue by 5,977% over the last year. That means its earnings are split among a greater number of shares. To talk about net income, without noticing earnings per share, is to be distracted by the big numbers while ignoring the smaller numbers that talk to per share value. You can see a chart of MicroAlgo's EPS by clicking here. Unfortunately, we don't have any visibility into its profits three years back, because we lack the data. Zooming in to the last year, we still can't talk about growth rates coherently, since it made a loss last year. But mathematics aside, it is always good to see when a formerly unprofitable business come good (though we accept profit would have been higher if dilution had not been required). And so, you can see quite clearly that dilution is having a rather significant impact on shareholders. In the long term, if MicroAlgo's earnings per share can increase, then the share price should too. But on the other hand, we'd be far less excited to learn profit (but not EPS) was improving. For the ordinary retail shareholder, EPS is a great measure to check your hypothetical "share" of the company's profit. As it turns out, MicroAlgo couldn't match its profit with cashflow and its dilution means that shareholders own less of the company than the did before (unless they bought more shares). For all the reasons mentioned above, we think that, at a glance, MicroAlgo's statutory profits could be considered to be low quality, because they are likely to give investors an overly positive impression of the company. If you'd like to know more about MicroAlgo as a business, it's important to be aware of any risks it's facing. Case in point: We've spotted 4 warning signs for MicroAlgo you should be mindful of and 3 of these shouldn't be ignored. Our examination of MicroAlgo has focussed on certain factors that can make its earnings look better than they are. And, on that basis, we are somewhat skeptical. But there is always more to discover if you are capable of focussing your mind on minutiae. For example, many people consider a high return on equity as an indication of favorable business economics, while others like to 'follow the money' and search out stocks that insiders are buying. So you may wish to see this free collection of companies boasting high return on equity, or this list of stocks with high insider ownership. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. 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Associated Press
02-05-2025
- Business
- Associated Press
MicroAlgo Inc. Develops Classifier Auto-Optimization Technology Based on Variational Quantum Algorithms, Accelerating the Advancement of Quantum Machine Learning
SHENZHEN, China, May 2, 2025 /PRNewswire/ -- MicroAlgo Inc. (the 'Company' or 'MicroAlgo') (NASDAQ: MLGO) announced today the launch of their latest classifier auto-optimization technology based on Variational Quantum Algorithms (VQA). This technology significantly reduces the complexity of parameter updates during training through deep optimization of the core circuit, markedly improving computational efficiency. Compared to other quantum classifiers, this optimized model has lower complexity and incorporates advanced regularization techniques, effectively preventing model overfitting and enhancing the classifier's generalization capability. The introduction of this technology marks a significant step forward in the practical application of quantum machine learning. Traditional quantum classifiers can theoretically leverage the advantages of quantum computing to accelerate machine learning tasks, but they still face numerous challenges in practical applications. Firstly, current mainstream quantum classifiers often require deep quantum circuits to achieve efficient feature mapping, which results in high optimization complexity for quantum parameters during training. Additionally, as the volume of training data increases, the computational load for parameter updates grows rapidly, leading to prolonged training times and impacting the model's practicality. MicroAlgo's classifier auto-optimization technology significantly reduces computational complexity through deep optimization of the core circuit. This approach improves upon two key aspects: circuit design and optimization algorithms. In terms of circuit design, the technology adopts a streamlined quantum circuit structure, reducing the number of quantum gates and thereby lowering the consumption of computational resources. On the optimization algorithm front, this classifier auto-optimization model employs an innovative parameter update strategy, making parameter adjustments more efficient and substantially accelerating training speed. In the training process of classifiers based on variational quantum algorithms (VQA), parameter optimization is one of the most critical steps. Generally, VQA classifiers rely on Parameterized Quantum Circuits (PQC), where updating each parameter requires computing gradients to adjust the circuit structure and minimize the loss function. However, the deeper the quantum circuit, the more complex the parameter space becomes, requiring optimization algorithms to perform more iterations to achieve convergence. Furthermore, uncertainties and noise in quantum measurements can also affect the training process, making it difficult for the model to optimize stably. Traditional optimization methods often employ strategies such as Stochastic Gradient Descent (SGD) or Variational Quantum Natural Gradient (VQNG) to find optimal parameters. However, these methods still face challenges such as high computational complexity, slow convergence rates, and a tendency to get trapped in local optima. Therefore, reducing the computational burden of parameter updates and improving training stability have become key factors in enhancing the performance of VQA classifiers. MicroAlgo's classifier auto-optimization technology, based on variational quantum algorithms, significantly reduces the computational complexity of parameter updates through deep optimization of the core circuit. It also incorporates innovative regularization techniques to enhance the stability and generalization capability of the training process. The core breakthroughs of this technology include the following aspects: Depth Optimization of Quantum Circuits to Reduce Computational Complexity: In traditional VQA classifier designs, the number of layers in the quantum circuit directly impacts computational complexity. To lower computational costs, MicroAlgo employs an Adaptive Circuit Pruning (ACP) method during optimization. This approach dynamically adjusts the circuit structure, eliminating redundant parameters while preserving the classifier's expressive power. As a result, the number of parameters required during training is significantly reduced, leading to a substantial decrease in computational complexity. Hamiltonian Transformation Optimization (HTO): Additionally, MicroAlgo introduces an optimization method based on Hamiltonian transformations. By altering the Hamiltonian representation of the variational quantum circuit, this technique shortens the search path within the parameter space, thereby improving optimization efficiency. Experimental results demonstrate that this method can reduce computational complexity by at least an order of magnitude while maintaining classification accuracy. Novel Regularization Strategy to Enhance Training Stability and Generalization Capability: In classical machine learning, regularization methods are widely used to prevent model overfitting. In the realm of quantum machine learning, MicroAlgo introduces a novel quantum regularization strategy called Quantum Entanglement Regularization (QER). This method dynamically adjusts the strength of quantum entanglement during training, preventing the model from overfitting the training data and thereby improving the classifier's generalization ability on unseen data. Additionally, an optimization strategy based on the Energy Landscape is incorporated, which adjusts the shape of the loss function during training. This enables the optimization algorithm to more quickly identify the global optimum, reducing the impact of local optima. Enhanced Noise Robustness for Real Quantum Computing Environments: Given that current Noisy Intermediate-Scale Quantum (NISQ) devices still exhibit significant noise levels, a model's noise resilience is critical. To improve the classifier's robustness, MicroAlgo proposes a technique based on Variational Quantum Error Correction (VQEC). This method actively learns noise patterns during training and adjusts circuit parameters to mitigate noise effects. This strategy markedly enhances the classifier's stability in noisy environments, making its performance on real quantum devices more reliable. MicroAlgo's classifier auto-optimization technology, based on variational quantum algorithms, successfully reduces the computational complexity of parameter updates through deep optimization of the core circuit and the introduction of novel regularization methods. This approach significantly boosts training speed and generalization capability. This breakthrough technology not only demonstrates its effectiveness in theory but also exhibits superior performance in simulation experiments, laying a crucial foundation for the advancement of quantum machine learning. As quantum computing hardware continues to advance, this technology will further expand its application domains in the future, accelerating the practical implementation of quantum intelligent computing and propelling quantum computing into a new stage of real-world utility. In an era where quantum computing and artificial intelligence converge, this innovation will undoubtedly serve as a significant milestone in advancing the frontiers of technology. About MicroAlgo Inc. MicroAlgo Inc. (the 'MicroAlgo'), a Cayman Islands exempted company, is dedicated to the development and application of bespoke central processing algorithms. MicroAlgo provides comprehensive solutions to customers by integrating central processing algorithms with software or hardware, or both, thereby helping them to increase the number of customers, improve end-user satisfaction, achieve direct cost savings, reduce power consumption, and achieve technical goals. The range of MicroAlgo's services includes algorithm optimization, accelerating computing power without the need for hardware upgrades, lightweight data processing, and data intelligence services. MicroAlgo's ability to efficiently deliver software and hardware optimization to customers through bespoke central processing algorithms serves as a driving force for MicroAlgo's long-term development. Forward-Looking Statements This press release contains statements that may constitute 'forward-looking statements.' Forward-looking statements are subject to numerous conditions, many of which are beyond the control of MicroAlgo, including those set forth in the Risk Factors section of MicroAlgo's periodic reports on Forms 10-K and 8-K filed with the SEC. Copies are available on the SEC's website, Words such as 'expect,' 'estimate,' 'project,' 'budget,' 'forecast,' 'anticipate,' 'intend,' 'plan,' 'may,' 'will,' 'could,' 'should,' 'believes,' 'predicts,' 'potential,' 'continue,' and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include, without limitation, MicroAlgo's expectations with respect to future performance and anticipated financial impacts of the business transaction. MicroAlgo undertakes no obligation to update these statements for revisions or changes after the date of this release, except as may be required by law. View original content: SOURCE
Yahoo
30-04-2025
- Business
- Yahoo
Here's What's Concerning About MicroAlgo's (NASDAQ:MLGO) Returns On Capital
If you're not sure where to start when looking for the next multi-bagger, there are a few key trends you should keep an eye out for. One common approach is to try and find a company with returns on capital employed (ROCE) that are increasing, in conjunction with a growing amount of capital employed. If you see this, it typically means it's a company with a great business model and plenty of profitable reinvestment opportunities. However, after briefly looking over the numbers, we don't think MicroAlgo (NASDAQ:MLGO) has the makings of a multi-bagger going forward, but let's have a look at why that may be. We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free. For those that aren't sure what ROCE is, it measures the amount of pre-tax profits a company can generate from the capital employed in its business. To calculate this metric for MicroAlgo, this is the formula: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.019 = CN¥20m ÷ (CN¥1.3b - CN¥207m) (Based on the trailing twelve months to December 2024). Thus, MicroAlgo has an ROCE of 1.9%. In absolute terms, that's a low return and it also under-performs the IT industry average of 9.4%. Check out our latest analysis for MicroAlgo Historical performance is a great place to start when researching a stock so above you can see the gauge for MicroAlgo's ROCE against it's prior returns. If you'd like to look at how MicroAlgo has performed in the past in other metrics, you can view this free graph of MicroAlgo's past earnings, revenue and cash flow. Unfortunately, the trend isn't great with ROCE falling from 24% five years ago, while capital employed has grown 379%. That being said, MicroAlgo raised some capital prior to their latest results being released, so that could partly explain the increase in capital employed. It's unlikely that all of the funds raised have been put to work yet, so as a consequence MicroAlgo might not have received a full period of earnings contribution from it. While on the subject, we noticed that the ratio of current liabilities to total assets has risen to 16%, which has impacted the ROCE. If current liabilities hadn't increased as much as they did, the ROCE could actually be even lower. Keep an eye on this ratio, because the business could encounter some new risks if this metric gets too high. Bringing it all together, while we're somewhat encouraged by MicroAlgo's reinvestment in its own business, we're aware that returns are shrinking. And investors may be expecting the fundamentals to get a lot worse because the stock has crashed 100% over the last three years. In any case, the stock doesn't have these traits of a multi-bagger discussed above, so if that's what you're looking for, we think you'd have more luck elsewhere. MicroAlgo does have some risks, we noticed 4 warning signs (and 3 which can't be ignored) we think you should know about. While MicroAlgo may not currently earn the highest returns, we've compiled a list of companies that currently earn more than 25% return on equity. Check out this free list here. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Sign in to access your portfolio
Yahoo
02-04-2025
- Business
- Yahoo
WiMi Hologram Cloud raises stake in MicroAlgo to 67.65%
WiMi Hologram Cloud (WiMi) announced it has increased its stake in MicroAlgo (MLGO) to 67.65% and committed to a ten-year lock-up period for all currently owned MicroAlgo shares. As of March 27, WIMI Hologram Cloud holds 40,000 Class A ordinary shares, 1,810,658 Class A ordinary shares (restricted), and 44,878,261 Class B ordinary shares of MicroAlgo, representing a total equity stake of 67.65% of MicroAlgo's total shares outstanding. WIMI has no plans to sell or otherwise dispose of any Microalgo ordinary shares. To stabilize market expectations, WIMI Hologram Cloud has committed to a ten-year lock-up period for all currently owned MicroAlgo shares. Discover the latest stocks recommended by top Wall Street analysts, all in one place with Analyst Top Stocks. Make smarter investments with weekly expert stock picks from the Smart Investor Newsletter. Published first on TheFly – the ultimate source for real-time, market-moving breaking financial news. Try Now>> See Insiders' Hot Stocks on TipRanks >> Read More on WIMI: Disclaimer & DisclosureReport an Issue Largest borrow rate increases among liquid names WiMi Hologram Cloud Announces Termination of Deposit Agreement and Share Consolidation Plan WiMi Hologram Announces Major Share Restructuring and EGM WiMi Hologram Cloud to develop AI applications based on DeepSeek Sign in to access your portfolio
Yahoo
02-04-2025
- Business
- Yahoo
Why MicroAlgo (MLGO) Skyrocketed on Monday?
We recently compiled a list of the 10 Small Firms Kick Off Monday with Strong Gains. In this article, we are going to take a look at where MicroAlgo Inc. (NASDAQ:MLGO) stands against the other stocks with strong gains. Wall Street's main indices kicked off Monday's trading with a strong finish, ending in the green territory as investors hoped President Donald Trump would dial back on his wide-ranging tariff plans to allow the US to skirt an economic slowdown. The Nasdaq posted the largest gain, up 2.27 percent, followed by the S&P 500, up 1.76 percent, and the Dow Jones, at 1.42 percent. Ten companies under the micro- and small-cap sectors mirrored the broader market optimism, registering double- to triple-digit gains at intra-day trading. In this article, let us explore the reasons behind their gains. To come up with the list, we considered only the stocks with the highest gains in terms of percentage change. A technician in a lab coat analyzing the performance of a data intelligence service. MicroAlgo Inc. (NASDAQ:MLGO) skyrocketed by 508.7 percent at intra-day trading on Monday before ending the day just up by 455.16 percent to end at $13.99 apiece following news that it plans to issue more shares. According to the company, the new shares will be offered at a price of $8 apiece. The offering was in line with MLGO's $20-million bond purchase agreement with creditors in October last year. The bonds, which have a maturity period of 360 days, are convertible into common shares at a conversion price equal to 70 percent of the lowest closing market price during the 60 trading days preceding the conversion request. According to MicroAlgo (NASDAQ:MLGO), it received notice from the creditors under this US$20 million convertible bond purchase agreement, requesting the company to issue new shares at $0.8 per share to repay the debt in accordance with the agreement terms. 'The company plans to fulfill the relevant clauses of this US$20 million convertible bond purchase agreement and will issue new shares at $ 0.8 per share for debt repayment,' it said. Overall, MLGO ranks first on our list of small firms kick off Monday with strong gains. While we acknowledge the potential of MLGO as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is as promising as MLGO but trades at less than 5 times its earnings, check out our report about the cheapest AI stock. READ NEXT: and . Disclosure: None. This article is originally published at . Sign in to access your portfolio
