爱奇艺（IQ）：1季度业绩符合预期，关注微剧商业化进展

Investment Rating - The report maintains a "Buy" rating for the company, with a target price of $2.10, indicating a potential upside of 22.8% from the current price of $1.71 [1][26]. Core Insights - The company's quarterly performance met expectations, focusing on content ecosystem upgrades and increased investment in micro-drama content and user growth, which may temporarily impact short-term profits but is expected to enhance long-term competitiveness in user engagement [1][6]. - The report highlights the importance of micro-drama in driving membership growth and the progress in monetization through advertising and e-commerce [1][6]. Financial Performance Summary - The company reported a total revenue of RMB 7.186 billion and an adjusted operating profit of RMB 459 million for Q1 2025, reflecting a year-on-year decline of 9% and 58%, respectively, but a quarter-on-quarter increase of 9% and 13% [6][20]. - The revenue forecast for 2025 is adjusted to RMB 29.053 billion, with a slight decrease from previous estimates, while the adjusted net profit is projected to be RMB 1.1 billion [1][27]. - The report anticipates stable membership and advertising revenue in Q2 2025, driven by the performance of popular content [6][21]. Revenue Breakdown - The revenue composition includes paid memberships, online advertising, content distribution, and other income sources, with paid memberships expected to contribute RMB 17.693 billion in 2025 [1][27]. - The report indicates a focus on high-quality, shorter series and micro-dramas to diversify content offerings and reduce reliance on single titles [6][20]. Market Position and Strategy - The company aims to enhance its competitive position by increasing the quantity and quality of content, particularly through self-produced works and exploring new monetization avenues [1][6]. - The report emphasizes the strategic shift towards micro-dramas, with a current total of 15,000 micro-dramas available, split evenly between free and membership models [1][6].