Kunlun(SZ:300418) China Post Securities·2025-06-27 06:15Investment Rating - The report maintains a "Buy" rating for the company, expecting a relative increase in stock price of over 20% compared to the benchmark index within six months [7][15]. Core Insights - The company reported a revenue of 5.662 billion yuan in 2024, a year-on-year increase of 15.20%, but faced a net loss of 1.595 billion yuan, a decline of 226.74% compared to the previous year [4][11]. - The company is experiencing pressure on profits due to increased R&D and sales expenses, particularly in AI ecosystem development, which saw a 59.46% increase in R&D costs to 1.543 billion yuan [5][6]. - The international revenue share is growing, with overseas income reaching 51.5 billion yuan in 2024, accounting for 90.98% of total revenue, indicating a positive trend in internationalization [5]. Financial Performance Summary - For 2025, the company is projected to achieve revenues of 7.142 billion yuan, with a net loss of 440 million yuan, and an expected EPS of -0.35 yuan [7][11]. - The EBITDA is expected to improve from -302.30 million yuan in 2024 to -209.08 million yuan in 2025, indicating a potential recovery in operational performance [11][14]. - The company’s asset-liability ratio is currently at 17.9%, with expectations of gradual increases in the coming years [3][14]. Revenue and Profit Forecast - Revenue forecasts for 2025, 2026, and 2027 are 7.142 billion yuan, 8.009 billion yuan, and 8.886 billion yuan respectively, with corresponding net profits projected to be -440 million yuan, 10.38 million yuan, and 271.70 million yuan [7][11]. - The growth rates for revenue are expected to be 26.14% in 2025, 12.14% in 2026, and 10.94% in 2027, reflecting a strong growth trajectory despite current losses [11][14]. AI Commercialization Progress - The company has accelerated its AI commercialization efforts, with annual recurring revenue (ARR) from AI music reaching approximately 12 million USD and from the short drama platform DramaWave reaching about 120 million USD [6]. - The launch of the Skywork Super Agents app marks a significant step in AI application, integrating multiple intelligent agents into a single platform [6]. Market Position and Strategy - The company is positioned as a comprehensive internet technology firm, currently at a pivotal point for AI technology breakthroughs and application implementations, aiming to meet strong market demand through continuous innovation [6].