China Interactive Media & Entertainment: The First AI Movie Missed; But Industry Trend Intact

China's first AI movie, Sanxingdui: Past of the Future (三星堆：未來往事), which was released in cinemas on Oct 23, only generated box office of Rmb1.2mn as of today. Based on the current box office collection and our estimated production cost of Rmb20mn, it is highly likely that this movie project is loss-making for producer Bona Film. While this movie has missed expectations so far, at a cost of merely Rmb20mn we believe it is unlikely to deter platforms/producers from further leveraging AI content to lower the overall movie content production cost for larger screens. Post the release of the movie, we expect the China media sector to wait for the next AI content catalyst.