Summary of Key Points from Conference Call Records Industry Overview - The Hong Kong internet sector is expected to enter a new round of growth, with the current S&P Shiller PE in the US exceeding levels seen in 2021, indicating potential inflows into Hong Kong tech stocks as fundamentals improve for companies like Kuaishou and Alibaba [2][20]. Company Insights Kuaishou - Kuaishou's recent investor day showcased improvements in key business metrics, including e-commerce GMV, gross margin, and advertising revenue, all trending upwards [3][7]. - The company declared a dividend of 2 billion and launched the One Rack recommendation system, with management confident that they have stabilized at a mid-term profit bottom of 20 billion [3][8]. - AI algorithms are expected to enhance advertising business performance, with anticipated continuous improvement over the next one to two years [4][6]. - Kuaishou's financial performance has shown recovery, with core indicators returning to an upward trend despite previous declines due to competition from video platforms [7][21]. - The company is recommended for investment due to its clear strategy and competitive performance [11][12]. Alibaba - Alibaba's recent performance exceeded expectations, with strong growth in both e-commerce and cloud services, supported by AI advancements in cloud and self-developed chips [5][13]. - The core e-commerce segment's CMR grew by 10% year-on-year, driven by technology service fees, while instant retail saw a 12% increase [14]. - Despite a decline in overall profit margins by over 10 percentage points due to investments in instant retail, international digital business revenue showed significant improvement [14][19]. - Alibaba's target market valuation is assessed to have significant upside potential, with estimates suggesting at least a 50% increase or even a doubling of current prices [13]. - The company faces intense competition in instant retail from Meituan, with losses expected to reach 300 billion in the third quarter, but the order volume is stabilizing [15][16][17]. AI Technology Impact - AI technology is positively impacting various internet companies, with Tencent's advertising business expected to grow by 15-20% and Kuaishou's advertising revenue also on the rise due to AI enhancements [6][20]. - The global cloud computing market is experiencing accelerated revenue growth, with demand expected to outstrip supply, particularly benefiting Alibaba's cloud services [20]. Future Outlook - The instant retail market is projected to exceed 3 trillion, capturing a significant share of the e-commerce market, necessitating proactive strategies from Alibaba to maintain market position [18]. - Kuaishou's product development focuses on model effectiveness and controllability, with plans for further enhancements to improve user experience and competitiveness [9][10]. - Overall, the outlook for AI-related companies, including Kuaishou and Tencent, remains strong, with recommendations for investment based on their growth trajectories [21].