Kingsoft Office(SH:688111) Ping An Securities·2025-11-05 04:39Investment Rating - The report maintains a "Recommended" investment rating for the company [1][13]. Core Insights - The company has shown accelerated growth in its third-quarter performance, benefiting significantly from the potential of AI development [1][8]. - For the first three quarters of 2025, the company achieved a revenue of 4.178 billion yuan, a year-on-year increase of 15.21%, and a net profit attributable to shareholders of 1.178 billion yuan, up 13.32% year-on-year [4][8]. - The company's WPS software and WPS 365 businesses have experienced substantial growth, with revenues increasing by 50.52% and 71.61% respectively in the third quarter [9]. Summary by Sections Financial Performance - In Q3 2025, the company reported revenues of 1.521 billion yuan, reflecting a significant year-on-year growth of 25.33% [8]. - The gross margin for the first three quarters was 85.55%, a slight increase of 0.45 percentage points year-on-year [8]. - R&D investment reached 1.495 billion yuan, up 18.48% year-on-year, representing 35.77% of revenue [8]. Business Segments - The WPS software business generated 391 million yuan in revenue, marking a 50.52% increase year-on-year [9]. - The WPS 365 business saw revenue of 201 million yuan, with a remarkable growth rate of 71.61% [9]. - The personal WPS business achieved 899 million yuan in revenue, growing by 11.18% year-on-year [9]. Future Projections - The company has adjusted its profit forecasts for 2025-2027, expecting net profits of 1.955 billion yuan, 2.384 billion yuan, and 2.928 billion yuan respectively [9]. - The estimated EPS for 2025, 2026, and 2027 are projected to be 4.22 yuan, 5.15 yuan, and 6.32 yuan respectively, with corresponding P/E ratios of 83.0, 68.0, and 55.4 [9][11].