Kunlun(SZ:300418) INDUSTRIAL SECURITIES·2024-11-17 03:50Investment Rating - The report maintains an "Accumulate" rating for the company [3]. Core Insights - The company reported a revenue of 3.828 billion yuan for the first three quarters of 2024, representing a year-on-year growth of 4.00%. However, it incurred a net loss attributable to shareholders of 627 million yuan [5]. - The overseas business has shown strong performance, with its revenue share increasing to 89.68%, up by 5.62 percentage points year-on-year. The overall gross margin stands at 76.90% [5]. - The company has significantly increased its R&D expenses to 1.144 billion yuan, a rise of 84.47% year-on-year, to accelerate AI technology applications [5]. - The company is advancing its AI short drama and social applications, with the launch of the SkyReels platform scheduled for December 10, 2024 [5]. - The profit forecast has been adjusted due to increased R&D investments, with expected net profits for 2024-2026 being -214 million, 329 million, and 422 million yuan respectively [5]. Financial Summary - For 2023, the company reported a revenue of 4.915 billion yuan, with a projected increase to 5.435 billion yuan in 2024, reflecting a year-on-year growth of 10.6% [4]. - The gross margin is expected to improve from 78.8% in 2023 to 80.8% in 2024 [4]. - The return on equity (ROE) is projected to decline to -1.4% in 2024, with a gradual recovery to 2.2% and 2.7% in 2025 and 2026 respectively [4].