MANGO(SZ:300413) Xin Lang Cai Jing·2025-10-25 00:38Performance Review - The company's Q3 2025 performance was below expectations, with revenue of 3.099 billion yuan, a year-on-year decrease of 6.6% [1] - Net profit attributable to shareholders was 252 million yuan, down 33.5% year-on-year, while the net profit excluding non-recurring items was 181 million yuan, a decline of 42.3% [1] - The underperformance was primarily due to increased promotional spending and higher-than-expected sales expenses [1] Development Trends - Membership business showed stable development in Q3 2025, with new series launched including "Jinxiu Fanghua"; a slight decline in membership revenue is expected in the first three quarters of 2025 [2] - In Q4 2025, several key shows are scheduled for release, including "Shui Long Yin" on October 24, with additional content planned for 2026 [2] - Advertising revenue in Q3 2025 is anticipated to grow year-on-year, supported by new variety shows such as "The Great Escape Season 7" and "Flowers and Youth: Together Season" [2] - The gross margin slightly improved quarter-on-quarter to 27.6%, despite a year-on-year decline of 2.2 percentage points due to increased content costs [2] - Sales expenses rose by 20.3% year-on-year to 550 million yuan, driven by higher promotional investments, while management expenses also increased to 104 million yuan [2] Current Perspective - The company is expected to benefit from new regulations that will allow for more targeted investments in premium content, indicating long-term growth potential in the membership business [3] - In October, the company launched the "AIGC Micro-Short Drama Creator Ecosystem Plan," aiming to support the creation of numerous micro-short dramas and provide resources for AI applications [3] Profit Forecast and Valuation - Due to increased sales expenses, the net profit forecast for 2025 has been reduced by 20% to 1.103 billion yuan, while the 2026 net profit forecast remains unchanged [4] - The current price corresponds to a 31 times P/E ratio for 2026, with a maintained outperform rating and a target price of 35 yuan, indicating a potential upside of 21.2% [4]