Core Viewpoint - The recent launch of AI tools by Anthropic has raised concerns in the market about the software industry narrative shifting from "empowered by AI" to "consumed by AI," affecting companies like Adobe and Meitu. However, a report from Zheshang Securities indicates that Meitu's products are positioned as aesthetic creation platforms and are beneficiaries of AI technology, assigning a "buy" rating with a target price of HKD 11.6 [1][4]. Group 1: Product Positioning and Market Concerns - Meitu's products are categorized as decision support software, focusing on enhancing user creativity and subjective judgment, which differentiates them from process optimization tools that AI agents are likely to replace [1][4]. - The report suggests that Meitu's existing customer base is not the target audience for "one-click AI photo editing" products, as their core demand is for tools that allow for subjective aesthetic expression [2][5]. - Despite the rise of AI-generated images or editing products from major AI firms, Meitu's core advantages lie in its extensive material library and familiar workflow interface, which reduces the likelihood of customer churn [6]. Group 2: User Engagement and Growth Potential - Meitu has maintained an upward trend in monthly active users (MAU) since 2021, indicating a stable demand for its services, even as smartphone editing features become more advanced [5][6]. - The company continues to see an increase in paid users, demonstrating a willingness among customers to pay for personalized aesthetic expression tools [6]. - New product launches, such as the video editing tool Wink, have successfully attracted over 30 million global MAUs, showcasing Meitu's ability to capture quality new traffic despite competition [6]. Group 3: Long-term Viability and Financial Outlook - The report concludes that while AI capabilities may alter the interaction forms of Meitu's products, they will not undermine the company's long-term competitive advantages, including its aesthetic expertise and large, stable user base [3][6]. - Meitu's overseas MAU and paid penetration rates are expected to continue growing, with higher subscription prices and willingness to pay among B-end users likely to enhance average revenue per paying user (ARPPU), driving sustained revenue growth [3][6].