iQIYI(US:IQ) Orient Securities·2024-05-21 07:32Investment Rating - The report maintains a "Buy" rating for the company with a target price of $7.76 per ADS [2][4]. Core Insights - The company's revenue for Q1 2024 reached 7.9 billion, representing a year-over-year increase of 5.1% and a quarter-over-quarter increase of 2.9%, primarily driven by growth in content distribution revenue [1]. - The report anticipates Q2 2024 revenue to be around 7.7 billion, with a projected GAAP net profit of 420 million, reflecting a year-over-year increase of 14.8% but a quarter-over-quarter decrease of 36% [1]. - Membership service revenue for Q1 2024 was 4.8 billion, down 13.5% year-over-year, attributed to a high base effect from the previous year [1]. - Advertising revenue for Q1 2024 was 1.48 billion, up 5.6% year-over-year, driven by growth in performance advertising [1]. - Content distribution revenue for Q1 2024 was 930 million, showing a significant year-over-year increase of 26.8% [1]. Financial Summary - The company expects GAAP net profits for 2024 to be 3.017 billion, with projected growth rates of 56.68% in 2024, 47.68% in 2025, and 25.99% in 2026 [2][3]. - The gross margin for Q1 2024 was 29%, with a year-over-year increase of 0.30 percentage points [1]. - The report projects a steady increase in revenue from 31.873 billion in 2023 to 39.633 billion in 2026, with corresponding growth rates of 9.91% in 2023 and 4.87% in 2024 [3][9].