
Investment Rating - The report maintains a "Buy" rating for the company [5][7]. Core Views - The company has launched the AI-native gameplay in the mobile game "Space Kill" and released two self-developed large models, enhancing its game interaction experience and content creation capabilities [3][4]. - The "Journey" IP has shown strong performance with the mini-game "King's Journey" ranking as high as fourth in the WeChat mini-game sales chart, indicating effective low-cost user acquisition strategies [2]. - The company is actively building an MMO esports event system, with multiple esports formats already launched for the "Journey" IP series games [2]. Financial Overview - For the first three quarters of 2024, the company reported a revenue of 2.218 billion yuan, a year-on-year decline of 2.15%, and a net profit attributable to shareholders of 1.071 billion yuan, down 1.29% year-on-year. The net profit excluding non-recurring items was 1.274 billion yuan, up 14.16% year-on-year [1]. - In Q3 2024, the company achieved a revenue of 791 million yuan, a year-on-year decrease of 3.94%, but a quarter-on-quarter increase of 8.28%. The net profit attributable to shareholders was 353 million yuan, down 16.18% year-on-year, but up 3.34% quarter-on-quarter [1]. - The company has adjusted its profit forecast for 2024-2026, expecting net profits of 1.510 billion, 1.730 billion, and 1.946 billion yuan respectively, with growth rates of 39.0%, 14.6%, and 12.5% [5][6]. Financial Metrics - The company’s projected revenue for 2024 is 3.105 billion yuan, with a year-on-year growth rate of 6.2%. The projected net profit for 2024 is 1.510 billion yuan, with a year-on-year growth rate of 39.0% [6][13]. - The earnings per share (EPS) for 2024 is expected to be 0.78 yuan, with a projected price-to-earnings (P/E) ratio of 16.3 times [6][13]. - The company’s return on equity (ROE) is projected to be 11.5% in 2024, increasing to 11.9% by 2026 [6][13].