The AIPC industry is expected to accelerate development, and the company is expected to continue to benefit
The AIPC technology side route is gradually being clarified, and product implementation is gradually progressing, and the industry is expected to accelerate development. According to IDC, in 2022/23Q1-Q3, global PC shipments were 290 million units/160 million units, with a year-on-year growth rate of -16.5%/-18.4%. The PC market may have experienced a year-on-year decline for two consecutive years, while global PC shipments in 1Q23/2Q23/3Q23 grew at a year-on-year rate of -29%/-17%/-8% in a single quarter, and shipments improved marginal quarterly. We believe AIPC is expected to be an important driver for the further recovery of the PC market. The company is actively building AI+ products and cooperating closely with PC channels, which is expected to fully benefit the development of the AIPC industry. The 2023-2025 EPS is expected to be 0.01/0.09/0.35 yuan. Comparable companies in '23, ifind unanimously expected the average PS value to be 15.5 times, giving 15.5 times PS in 2023, with a target price of 107.11 yuan, a “buy”.
Technological breakthroughs+product implementation+ecosystem gradual establishment, AIPC industry accelerates development, AIPC industry accelerates development: 1) technical perspective, leading manufacturers meet AIPC's demand for low power consumption and high performance of terminal computing power through innovative architecture designs such as hybrid AI architectures and separate modules; 2) Product perspective: Chip manufacturers have released chip products optimized for AIPC scenarios one after another, such as Snapdragon XElite and Intel Meteor Lake. Machine manufacturers are also actively promoting product implementation. For example, Lenovo AIPC will be launched around September next year; 3) Ecological perspective: Underlying computing power manufacturers build on existing field advantages and actively cooperate, and the ecosystem is expected to be gradually established. We believe that with technological breakthroughs, product implementation, and gradual ecological establishment, the AIPC industry is expected to accelerate development.
Product side: The commercialization of AI+PDF is progressing smoothly, and the functions are expected to continue to iterate, and the commercialization of the company's AI+PDF is progressing smoothly. In September 2023, the PDF editor of the company's core product was upgraded. After the upgrade, all forms of overseas PDF editors integrated AIGC technology. The desktop and mobile editors can achieve the three functions of document summary, content rewriting, and real-time interaction. As of the end of 23Q3, the company has integrated AIGC functions in overseas desktop, cloud, and mobile PDF editors, and the commercialization of AI+PDF is progressing smoothly. The cloud version has the advantages of fast product updates and timely user feedback. The PC side has the advantage of having a large customer base, bringing more room for customer growth. We believe that as the company's AI+PDF products continue to iterate, the company's product strength is expected to continue to increase.
Channel side: Channel transformation is progressing smoothly, key channel cooperation is close, company channel transformation is progressing smoothly, and cooperation with key channels is close. In terms of cooperation methods, take Dell as an example. In the company's partnership with Dell, Dell can sell the company's products through bundled sales. The company has also set up a dedicated product promotion team within Dell. Other relatively mature traditional agents other than Dell can also endorse the company, and the company's brand influence is expected to continue to expand. In terms of revenue share, Dell ranked first in revenue among the company's overseas channel vendors in 2022, accounting for about 12% of the company's operating income. We believe that with the development of the AIPC industry, the company is expected to fully benefit by relying on good partnerships with channels.
Risk warning: The expansion of new application scenarios falls short of expectations; market competition risks.