360 Security Technology loses 2.2 billion yuan due to enormous investment into LLMs

Data shows the companys total revenue in 2022 was 9.521 billion yuan, a year-on-year decrease of 12.54%, and the net loss attributable to the owners of the parent company was 2.204 billion yuan, compared with a net profit of 902 million yuan in the same period of the previous year, marking the first annual loss since the companys return to the A-share market in 2022.

In an internal letter released on April 21, 360 Security Technology Inc.s founder Zhou Hongyi demanded employees and business units to embrace artificial intelligence and adapt to human-machine collaboration.

In the first quarter of this year, 360 Security Technology Inc.s total revenue was about 1.966 billion yuan, a year-on-year decrease of 22.17%, and the net loss was 186 million yuan, compared with a profit of 222 million yuan in the same period last year. The main reason for the loss was the companys full-scale deployment of large language models (LLMs), resulting in a significant increase in expenses such as manpower and equipment.

In the annual report, 360 Security Technology Inc. stated that it adheres to the four-way path in commercialization: on the user side, the company has leveraged expereince from Microsofts NewBing to combine the product matrix of 360GPT with the search scene to launch a new generation of intelligent search engines; on the SME side, the company will launch SaaS-based vertical applications combined with the capabilities of 360 Brain of Security; on the government and enterprise side, the company will develop private LLMs for cities and enterprises; in the security field, the company plans to combine its core security capabilities with GPT to launch the 360GPT security application framework.


On April 21, 360 Security Technology Inc. released its 2022 annual report and results for the first quarter of 2023.

As of the days market close, 360 Security Technology Inc. closed at 15.98 yuan, down 5.22%, representing a cumulative increase of over 140% in the companys stock price so r this year.

The company said it is actively seizing the development opportunities of LLMs with the two-winged strategy: strengthening core algorithm research and development while accelerating the applications in advantageous scenarios.