Kingsoft Office(SH:688111) Huachuang Securities·2025-11-12 10:43Investment Rating - The report maintains a "Strong Buy" rating for Kingsoft Office (688111) with a target price of 432.9 CNY [1]. Core Insights - Kingsoft Office reported a revenue of 1.521 billion CNY for Q3 2025, representing a year-on-year growth of 25.33%. The net profit attributable to shareholders was 431 million CNY, up 35.42% year-on-year, while the non-GAAP net profit reached 421 million CNY, growing by 39.01% year-on-year [1][8]. - For the year-to-date, the total revenue reached 4.178 billion CNY, reflecting a year-on-year increase of 15.21% [1]. - The company is experiencing robust growth across its three main business segments, driven by advancements in AI and the promotion of domestic software solutions [3][8]. Financial Performance - The WPS 365 business generated 201 million CNY in revenue, marking a significant increase of 71.61% year-on-year. The company has effectively expanded its reach among private enterprises and local state-owned enterprises, enhancing its product capabilities and industry influence [3]. - The WPS software business achieved revenue of 391 million CNY, a year-on-year increase of 50.52%, supported by accelerated bidding and revenue recognition in government projects [3]. - The company’s R&D investment was 536 million CNY in Q3 2025, accounting for 35.24% of its revenue, indicating a strong commitment to innovation and technology development [8]. Business Growth Drivers - The personal WPS business reported revenue of 899 million CNY, with a year-on-year growth of 11.18%. The number of active devices reached 669 million, an increase of 8.83% year-on-year, with significant growth in the PC segment [8]. - The report highlights the company's strong cash flow, with a net cash flow from operating activities of 538 million CNY in Q3 2025, and a cumulative total of 1.277 billion CNY for the first three quarters, up 18.26% year-on-year [8]. Future Projections - The company is projected to achieve revenues of 6.049 billion CNY, 7.162 billion CNY, and 8.505 billion CNY for the years 2025, 2026, and 2027, respectively, with corresponding growth rates of 18.1%, 18.4%, and 18.7% [8]. - The net profit attributable to shareholders is expected to be 2.044 billion CNY, 2.324 billion CNY, and 2.702 billion CNY for the same years, with growth rates of 24.2%, 13.7%, and 16.3% respectively [8].