Newborn Town Inc. has established its global headquarters at Hong Kong Science Park, officially launched on June 5.

Representatives from Hong Kong’s Office for Attracting Strategic Enterprises (OASES), Hong Kong Science and Technology Parks Corporation (HKSTP), and senior executives of Newborn Town attended the ceremony.

The headquarters operates under Solo X Technology Limited and is a key part of the company’s global expansion.

Chairman Chunhe Liu highlighted that Hong Kong’s business environment, capital market, and talent pool were major factors in this decision.

Founded in 2009, Newborn Town has been pursuing globalization since 2013 and went public on the Hong Kong Stock Exchange in 2019.

The company’s products, including MICO, YoHo, and Alice’s Dream: Merge Games, are available in more than 150 countries.

.source-ref{font-size:0.85em;color:#666;display:block;margin-top:1em;}a.ask-tia-citation-link:hover{color:#11628d !important;background:#e9f6f5 !important;border-color:#11628d !important;text-decoration:none !important;}@media only screen and (min-width:768px){a.ask-tia-citation-link{font-size:11px !important;}}

🔗 Source: Newborn Town

🧠 Food for thought

1️⃣ Strategic focus on underserved markets drives exceptional growth

Newborn Town’s targeted expansion in the Middle East and North Africa (MENA) demonstrates the value of precise regional focus over attempting to compete in saturated markets.

The company’s revenue in the MENA region grew by over 60% in 2024, significantly outpacing the overall company growth rate of 53.9% 1.

This success stems from deliberately targeting a region with unique characteristics: MENA users maintain an average of 8.4 social media accounts and spend 3.5 hours daily on these platforms, creating strong monetization opportunities 2.

The regional strategy is backed by deep localization efforts, with apps like TopTop featuring games such as Dominoes and Ludo that specifically cater to Middle Eastern entertainment preferences 2.

Establishing both a regional headquarters in Riyadh and now a global headquarters in Hong Kong creates a strategic operational bridge between the company’s high-growth markets and international financial centers.

The MENA media and entertainment market is projected to grow from $42.72 billion in 2024 to $66.99 billion by 2028, providing substantial runway for continued expansion 2.

2️⃣ AI innovation delivers concrete business results, not just marketing hype

Unlike many companies that position AI as future potential, Newborn Town has translated its AI investments into measurable financial outcomes through its proprietary Boomiix multimodal algorithm.

The company’s self-developed AI system has directly contributed to exceptional product performance, with apps like SUGO seeing revenue surge over 200% year-over-year and earning a top-10 ranking in the Middle East App Store revenue charts 3.

This AI-powered growth contrasts with the broader social networking industry, where Newborn Town’s 41-48% year-over-year revenue growth in Q1 2025 significantly outpaces most competitors 4.

The algorithm optimizes user engagement through sophisticated behavior analysis and recommendation systems, enabling the company to rapidly launch localized platforms in new markets with minimal manual intervention 5.

By establishing its global headquarters at Hong Kong Science Park, the company gains access to Hong Kong’s advanced AI research ecosystem, positioning itself to further enhance its competitive advantage through deeper AI integration.

3️⃣ Significant valuation gap suggests market underappreciation of social innovation

Despite delivering exceptional financial results, Newborn Town trades at just 11x projected 2025 earnings, representing a substantial discount to many technology and social media peers 6.

This valuation gap persists despite the company’s 44.1% revenue CAGR from 2020 to 2024, with revenues growing from RMB 1.18 billion to RMB 5.09 billion over this period 6.

The market’s hesitancy appears tied to investor perceptions about social entertainment companies rather than fundamental performance, as evidenced by the company’s trailing P/E ratio of 6.7 compared to Match Group’s significantly higher multiple 7.

Newborn Town’s share repurchase program of HKD 200 million signals management confidence in the company’s intrinsic value being higher than current market pricing 1.

CITIC Securities’ price target of HK$11 for 2025 suggests a potential upside of nearly 17% from current trading levels, reflecting professional analysts’ recognition of the value gap 5.

The establishment of a global headquarters in Hong Kong could serve as a catalyst for market revaluation by increasing institutional investor visibility and confidence in the company’s governance and growth strategy.

……