WLY(SZ:000858) HTSC·2025-10-31 08:49Investment Rating - The report maintains an investment rating of "Buy" for the company [1][9]. Core Views - The company reported a total revenue of 609.5 billion RMB for the first three quarters of 2025, a year-on-year decrease of 10.3%, with net profit attributable to the parent company at 215.1 billion RMB, down 13.7% [6][9]. - In Q3 2025, total revenue was 81.7 billion RMB, reflecting a significant decline of 52.7% year-on-year, with net profit down 65.6% [6][9]. - The company is actively reforming its marketing strategies and focusing on brand value enhancement, despite facing external pressures on core product sales and pricing [6][9]. - A cash dividend of 25.78 RMB per 10 shares is proposed, totaling 10 billion RMB, indicating a commitment to shareholder returns [6][9]. Financial Performance - Revenue projections for 2025 are adjusted to 77.065 billion RMB, a decrease of 13.58% from previous estimates, with net profit expected to be 26.162 billion RMB, down 17.87% [5][9]. - The company's gross margin for Q1-Q3 2025 decreased by 2.1 percentage points to 74.9%, with a more pronounced drop in Q3 to 62.6% [8][9]. - The report highlights a significant decline in cash flow, with operating cash flow at -28.9 billion RMB in Q3 2025, a year-on-year decrease of 117.65% [8][9]. Market Position and Strategy - The company is focusing on channel health and inventory reduction, with a stable growth in the opening rate of its premium products [7][9]. - The marketing reform is expected to enhance brand value and market presence, with a long-term view of sustainable development [6][9]. - The report emphasizes the company's strong brand power and ongoing marketing reforms as key drivers for future growth [9].