Huaan Securities·2025-11-27 03:44Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company reported a revenue of 7.685 billion yuan in Q3 2025, representing a year-over-year increase of 5.2% and a quarter-over-quarter increase of 4.7% [4] - The adjusted net profit attributable to the parent company for Q3 2025 was 786 million yuan, showing a significant year-over-year increase of 233% [4] - The gross margin for the third quarter was 36.7%, an increase of 1.8 percentage points year-over-year [4] - Mobile game revenue was 1.51 billion yuan, down 17.1% year-over-year due to a high base effect from the previous year [4] - Value-added services revenue reached 3.02 billion yuan, up 7.1% year-over-year, driven by growth in paid membership revenue [4] - Advertising revenue exceeded expectations at 2.57 billion yuan compared to the consensus of 2.51 billion yuan, marking a year-over-year increase of 22.7% [4] - IP derivatives and other revenue amounted to 580 million yuan, up 2.7% year-over-year [4] Business Performance - The company is focusing on long-term game operations, with the new game "Three Kingdoms: Hundred Generals Card" set to launch in Q1 2026 [5] - The game "Three Kingdoms: Strategize the World" continues to operate steadily, contributing to incremental growth in the gaming business [5] - The newly launched game "Escape from Duckkov" sold over 3 million copies in its first month, with peak online users exceeding 300,000 [5] - The core user metrics reached new highs, with daily active users (DAU) at 117 million, up 9% year-over-year, and monthly active users (MAU) at 376 million, up 8% year-over-year [6] - The average daily usage time per user increased by 6 minutes to 112 minutes, with the number of paying users reaching 35 million, up 17% year-over-year [6] Financial Forecast - The company is expected to achieve revenues of 30.18 billion yuan, 33.72 billion yuan, and 36.44 billion yuan for the years 2025, 2026, and 2027, respectively [7] - The adjusted net profit attributable to the parent company is projected to be 2.23 billion yuan, 3.60 billion yuan, and 4.42 billion yuan for the same years [7] - The previous forecasts for revenue and net profit have been slightly adjusted upwards [7] - The company maintains a gross margin forecast of 36.7% for 2025, increasing to 40.3% in 2026 and 40.9% in 2027 [10]