ArcSoft(688088) Guotou Securities·2024-09-01 09:43Investment Rating - The investment rating for the company is "Buy-A" with a target price of 31.37 CNY per share, maintaining the rating [4]. Core Views - The company's revenue for the first half of 2024 reached 381 million CNY, a year-on-year increase of 11.97%, while the net profit attributable to shareholders was 61.45 million CNY, up 22.82% year-on-year [1][2]. - The smart driving and IoT device business saw significant growth, with revenue increasing by 93.19% to 43 million CNY, driven by the increase in the number of smart car projects and product deliveries [2]. - The gross margin remained high at 90.35%, attributed to the successful transition of the smart driving business [2]. Business Segments Summary Smart Phone Visual Business - Revenue from the smartphone visual business was 332 million CNY, a growth of 6.43% year-on-year, due to the accelerated promotion of Turbo Fusion technology and its application in more high-end models [2]. Smart Driving and IoT Devices - The smart driving and IoT devices segment achieved revenue of 43 million CNY, marking a 93.19% increase year-on-year, primarily due to the increase in designated projects and product deliveries [2]. Smart Commercial Photography - The company launched the PhotoStudio® AI smart commercial photography cloud studio, which significantly reduced product shooting costs for merchants. The product has made notable progress in both product features and channel partnerships [3]. - The AI model video generation feature was introduced, allowing users to create realistic videos from a single photo, enhancing the product's market competitiveness [3]. Customer Expansion and Product Delivery - The company has successfully established multiple front-end mass production projects with various car manufacturers, including Changan New Energy and Geely, among others [8]. - The company’s algorithms for in-cabin and out-of-cabin applications have seen increased adoption, with several products achieving mass production [8]. Financial Projections - Revenue projections for 2024, 2025, and 2026 are estimated at 839 million CNY, 1.03 billion CNY, and 1.28 billion CNY respectively, with net profits expected to be 145 million CNY, 203 million CNY, and 288 million CNY [9][10].