Guohai Securities·2024-08-26 13:44Investment Rating - The report maintains a "Buy" rating for Kuaishou-W (1024.HK) [1] Core Insights - The company's revenue for Q2 2024 reached RMB 30.975 billion, representing a year-on-year increase of 11.6% and a quarter-on-quarter increase of 5.3% [5] - The adjusted net profit for Q2 2024 was RMB 4.679 billion, exceeding market expectations, with an adjusted net profit margin improving to 15.1% [3][5] - The company continues to leverage AI to enhance its core business operations, with significant improvements in profitability and user engagement metrics [6][7] Summary by Sections User Growth and Engagement - Kuaishou's platform user metrics show robust growth, with Monthly Active Users (MAU) reaching 692 million and Daily Active Users (DAU) at 395 million, maintaining high user engagement with an average daily usage time of 122 minutes [2][3] Financial Performance - The gross profit margin for Q2 2024 was 55.3%, an increase of 5.1 percentage points year-on-year [3] - The sales expense ratio was 32.4%, up 1.3 percentage points year-on-year, while the R&D expense ratio decreased to 9.1% [3] - The company achieved a significant year-on-year increase in online marketing service revenue, which grew by 22.1% to RMB 17.5 billion [4] Business Segments - Live streaming revenue for Q2 2024 was RMB 9.3 billion, a year-on-year decrease of 6.7% but an increase of 8.5% quarter-on-quarter [4] - Other business revenues increased by 21.3% to RMB 4.2 billion, with e-commerce GMV growing by 15% to RMB 305.3 billion [4][5] AI Integration - Kuaishou has developed an advanced AI matrix, including large language models and visual generation models, which are integrated into various business scenarios to enhance content creation and user interaction [6][7] Profitability Forecast - The report projects revenues for FY2024-2026 to be RMB 127.8 billion, RMB 142.5 billion, and RMB 157.4 billion respectively, with adjusted net profits of RMB 18.3 billion, RMB 23.3 billion, and RMB 27.8 billion [7][9]