In the era of digital technology, digital transformation has become a necessary approach for enterprises to improve core-technology competence. From a micro perspective, digital transformation not only provides enterprises with means and tools to develop core-technology competence, but also provides new business scenarios for enterprises;from a macro perspective,it helps Chinese enterprises to further open the international market and cultivate the technological advantages in some high-tech fields by embracing digital technology and carrying out digital transformation. Thus, it is of significance to systematically and comprehensively explore how digital transformation helps enterprises enhance their core-technology competence. Existing studies mainly focus on the linear relationship between digital transformation and enterprise performance, and some studies note that carrying out digital transformation improves enterprise performance, while other studies argue that digital transformation hinders enterprise performance. The controversy raises the question of whether there is a non-linear relationship between digital transformation and enterprise performance. #br#This paper aims to fill in the above-mentioned research gap by verifying that the relationship between digital transformation and core-technology competence is an inverted U-shape. Drawing on Hanns et al.’s research template, it builds a theoretical framework that deconstructs the inverted U-shape into two forces, namely the driving force and the blocking force. The driving force promotes the improvement of core-technology competence through the search and recombination of information, the coordination of multi-tasks, and organizational structure changes. The blocking force, in contrast, decreases the enterprises' core-technology competence in three dimensions of cost saving, talent recruitment and distraction. By integrating the driving force and blocking force, the inverted U-shape relationship between digital transformation and core-technology competence is formed. Furthermore, because managers usually play a decisive role in whether to conduct digital transformation and control the process of digital transformation;managers’ time orientation which includes forward-lookingness and myopia uncovers managers' thoughts about the enterprise development in the short and long term, it is necessary to include managers' time orientation in the theoretical framework of this paper.#br#With the help of existing text data in the annual reports of listed companies, word frequency is used to estimate enterprise digital transformation, managerial forward-lookingness and myopia. In the calculation of the core-technology competence of enterprises using the revealed technology advantage index, three more indicators are added, namely the average cited number of enterprise patents, the average number of claims of patent rights, and the average quality of patents. The four-dimensional index is then built, and by applying the entropy method, the core-technology competence is calculated. Using the fixed-effect model and instrumental variable method, this paper studies 9 491 observations of 2 182 listed companies from 2010 to 2019. The result shows that there exists an inverted U-shaped relationship between enterprise digital transformation and core-technology competence, and several robustness tests and endogeneity tests reconfirm the conclusion;the managerial forward-lookingness strengthens this relationship, implying that managerial forward-lookingness significantly promotes the core-technology competence and makes the curve steeper;while the managerial myopia weakens the relationship, indicating that managers' myopia has negative effects on the core-technology competence and makes the curve flatter.#br#Digital transformation is not a panacea for strengthening enterprise core-technology competence. Managers should implement digital transformation moderately to attain optimal core-technology competence. In addition, in the process of digital transformation, the managers' time orientation should be taken into account. Forward-looking managers instead of myopic ones can help enterprises achieve higher core-technology competence through digital transformation. Implications for policy-making are presented. First, managers should recognize that carrying out digital transformation has two opposite impacts on core technological competence. When implementing digital transformation, it is essential to adopt appropriate strategies to maximize the positive influence and control the negative impact. Second, when making strategic decisions, managers should focus on the long-term interests of enterprises, enhance their dynamic capabilities, provide more information on forward-lookingness in annual reports, and avoid overemphasizing the short-term interests of enterprises. Third, the government should provide policy support for enterprises that actively promote digital transformation and focus on cultivating core-technology competence, and guide enterprises to take advantage of digital transformation.#br#