2025-09-06 07:23Summary of Kuaishou Technology Conference Call Company Overview - Company: Kuaishou Technology (1024.HK) - Event: Asia Leaders Conference 2025 - Date: September 4, 2025 - Location: Hong Kong Key Industry Insights Kling AI - Revenue Composition: 70% of Kling AI's revenue comes from professional users, including AI freelancers, creators, and studios, while 30% is generated from API partnerships with over 20,000 enterprise clients [5] - Geographical Revenue Distribution: 70% of revenue is from overseas regions, and 30% is domestic [5] - Competitive Landscape: There are three major players in the AI video generation industry, each with distinct advantages. Kling AI focuses on professional users and has competitive advantages in user base, controllability, and real-world reflection in both input and output [5] - User Retention: Management noted infrequent user switching to other platforms unless a significantly stronger or cheaper model emerges [5] - Gross Margin: Kling AI's gross margin is currently positive and expected to grow, although high amortization from training chips remains a challenge. Management anticipates continued narrowing of losses [5] - Capex and Computing Power: Capex and computing power are not bottlenecks, with sufficient training chips available. Inference chips are lower-performance and sourced domestically [5] E-commerce and Advertising Monetization - Overall Take Rate: Kuaishou's overall take rate is less than 4%, with approximately 1% from e-commerce commissions and 2-3% from e-commerce ads [9] - Livestreaming E-commerce: Accounts for over 60% of total GMV (Gross Merchandise Volume) with a take rate of 4% [9] - Shelf-based E-commerce: Represents 32% of total GMV in Q2 2025, with a lower take rate of less than 2% [9] - Service Tools for Merchants: The company is enhancing service tools for merchants, allowing cost savings from content creation to be redirected towards purchasing traffic on Kuaishou [9] - Long-term Take Rate Potential: Management believes the platform's take rate can exceed 5% in the long term, benchmarking against peers [9] Financial Projections and Risks - Price Target: Kuaishou is rated as a "Buy" with a 12-month target price of HK$83, representing an upside of 18.7% from the current price of HK$69.90 [8] - Market Capitalization: HK$298.1 billion / $38.2 billion [8] - Revenue Forecasts: Projected revenues for the next few years are Rmb 126.9 billion in 2025, Rmb 142.8 billion in 2026, Rmb 157.6 billion in 2027, and Rmb 172.6 billion in 2028 [8] - Key Risks: 1. Slower-than-expected recovery in ad budgets [7] 2. Weaker-than-expected monetization [7] 3. Slower growth in user engagement [7] 4. Lower-than-expected profitability [7] 5. Weaker-than-expected progress in AI [7] Conclusion Kuaishou Technology is focusing on enhancing its AI capabilities and monetization strategies in e-commerce and advertising. The company is optimistic about its growth potential, despite facing competitive pressures and market risks. The management's insights into user retention and service enhancements for merchants indicate a strategic approach to maintaining and growing its user base and revenue streams.