Investment Rating - The investment rating for the company is "Buy" with a market price of USD 5.26 and a sector rating of "Outperform" [1][2]. Core Views - The company experienced a slight decline in membership revenue due to a high base effect from the previous year, but maintained high operational efficiency, achieving the best quarterly operating profit [2]. - The company is expected to focus on maximizing long-term membership revenue rather than just increasing membership numbers, with new growth opportunities anticipated from overseas business, IP derivative payments, and AIGC [2][3]. Financial Performance Summary - In Q1 2024, the company's operating revenue was CNY 79.27 billion, a year-on-year decrease of 5% but a quarter-on-quarter increase of 3% [2]. - Non-GAAP operating profit reached CNY 10.86 billion, with an operating profit margin of 14%, marking the best quarterly performance [2][4]. - GAAP net profit was CNY 6.55 billion, up 6% year-on-year and 41% quarter-on-quarter [2]. - Membership revenue for Q1 2024 was CNY 47.99 billion, down 13% year-on-year but stable quarter-on-quarter [2][4]. - Advertising revenue was CNY 14.82 billion, a year-on-year increase of 6% but a quarter-on-quarter decrease of 10% [2]. - Content distribution revenue surged to CNY 9.28 billion, up 27% year-on-year and 83% quarter-on-quarter, primarily due to increased important copyright sales [2][4]. Valuation and Future Projections - The company is projected to continue building a stable production system with a focus on profit and cash flow performance [2]. - Expected non-GAAP net profits for 2024, 2025, and 2026 are CNY 40.0 billion, CNY 45.8 billion, and CNY 51.5 billion respectively, with corresponding EPS of CNY 4.09, CNY 4.64, and CNY 5.21 [3][4].
爱奇艺：高基数导致会员收入下滑，保持较高运营效率