Giant Network(SZ:002558) Changjiang Securities·2024-11-06 01:54Investment Rating - The investment rating for the company is "Buy" and is maintained [7]. Core Views - The company reported a revenue of 791 million in Q3 2024, a year-on-year decrease of 3.94% but a quarter-on-quarter increase of 8.28%. The net profit attributable to the parent company was 353 million, down 16.18% year-on-year and down 3.34% quarter-on-quarter [3]. - The core products are performing steadily, with revenue continuing to show quarter-on-quarter growth. The "Journey" series is expected to maintain stable user numbers and revenue, while the casual competitive games have shown strong performance due to seasonal factors and version updates [3][4]. - The company is focusing on AI empowerment and IP development, with ongoing innovations in technology and gameplay expected to contribute to future performance growth [5]. Financial Performance Summary - For Q3 2024, the company experienced a slight increase in sales expenses to 280 million, up 22.0% year-on-year and 22.7% quarter-on-quarter, leading to a sales expense ratio of 35.2% [4]. - The company achieved an investment income of approximately 90 million in Q3 2024, down from 140 million in Q3 2023 and 200 million in Q2 2024 [4]. - The company’s contract liabilities stood at 490 million as of September 30, indicating potential revenue recognition in the future [5]. Profit Forecast and Investment Suggestions - The company is projected to achieve net profits attributable to the parent company of 1.45 billion in 2024 and 1.62 billion in 2025, corresponding to price-to-earnings ratios of 16.7 and 14.9, respectively [5].