Kuaishou Technology Conference Call Summary Company Overview - Company: Kuaishou Technology (1024.HK) - Industry: China Internet and Other Services Key Points Financial Performance - 4Q24 Results: Total revenue increased by 9% YoY, slightly below the market consensus estimate of 10% [3] - Adjusted Net Profit: Rose 8% YoY to Rmb4.7 billion, which was 2% better than market expectations [3] - Gross Merchandise Volume (GMV): Increased by 14.4%, aligning with guidance [3] Revenue Breakdown - Online Marketing Services: Missed expectations by 1% due to traffic subsidies to small and medium-sized businesses (SMBs) [3] - Other Services: Missed by 4%, but this was partially offset by a 2% beat in live-streaming revenue [3] AI and Kling Tool - Kling Revenue Contribution: Cumulative revenue from Kling since commercialization reached Rmb100 million [4] - 2025 Revenue Target for Kling: Management aims for US60 million (Rmb450 million) in revenue, which may negatively impact margins by 1-2 percentage points due to increased investment in AI-related capital expenditures and R&D [4] - **AI's Role**: AI is enhancing online marketing effectiveness and e-commerce business [4] 2025 Guidance - **Overall Revenue Growth Guidance**: Set at 13%, with specific targets of 14-15% for marketing, 19-20% for other services, and 3% for live streaming [4] - **Profit Guidance**: Expected profit for 2025 is Rmb20 billion, indicating a stable margin [4] - **1Q25 Outlook**: Expected to show a different revenue mix pattern, with weak marketing and strong live streaming, which is anticipated to reverse in 2Q25 [4] Valuation and Price Target - **New Price Target**: Increased from HK48.00 to HK1.5 billion based on a 25x EV/sales multiple, reflecting high-growth SaaS benchmarks [5] - Current Valuation: 2025 estimated P/E ratio is 12x, considered close to fair [5] Market Reaction - Stock Rating: Maintained at Equal-weight, with the industry view rated as Attractive [2] - Market Cap: Approximately Rmb233.38 billion [2] Additional Insights - Management's Confidence: Management believes Kling will be a significant growth driver, although it may take time to demonstrate its impact on Kuaishou's overall platform [2] - Operational Metrics: Average Monthly Active Users (MAU) reached 736 million, reflecting a 5% YoY growth [11] Summary of Changes - Revenue Forecasts: Increased by 4.2% and 8.3% for 2025 and 2026, respectively, due to better-than-expected management guidance [13] - Non-IFRS Diluted EPS: Raised by 8.0% and 11.5% for 2025 and 2026, respectively [13] This summary encapsulates the key financial metrics, strategic initiatives, and market outlook for Kuaishou Technology as discussed in the conference call.
Kuaishou Technology_ 4Q24 Results, 2025 Guidance in Line; High Target for Kling
2025-03-31 02:41