Core views:
Event: The blue cursor releases the 2023 results forecast. In 2023, the company expects to achieve net profit of 100 to 150 million yuan; after deducting non-net profit of 130 to 180 million yuan, all of which significantly turned losses into profits over the previous year.
Following the recovery of the macroeconomic environment in '23, the company's revenue side grew rapidly. Annual revenue is expected to exceed 52 billion yuan, an increase of 42% over the previous year; net profit turned loss into profit, and net cash flow from operating activities exceeded 600 million yuan.
Looking at a single quarter, based on annual revenue of 52 billion yuan, the blue cursor is expected to achieve revenue of 15.7 billion yuan in 23Q4, up 55.2% year on year, up 9.5% from month to month, with strong revenue growth; net profit loss to mother of 140 to 190 million yuan, narrowing sharply from 22Q4 loss to 2.2 billion yuan, from profit to loss; after deducting non-net profit loss of 140 to 190 million yuan, the year-on-year loss narrows sharply, from profit to loss month-on-month. Net profit is expected to drag down mainly due to the accrual of credit impairment losses, gains and losses from changes in fair value, and cost amortization of restricted stock incentives (grant date of September 7).
In terms of new AI businesses, the All in AI strategy is gradually paying off. According to the Blue Cursor official account, according to internal research results at the end of 2023, the overall AI-driven business efficiency was between 30% and 1000%, highlighting the efficiency improvement in business scenarios by more than ten times; in 23 years, 300+ cases were created through generative AI. Of these, more than 1/3 of the cases were deeply driven and brought large-scale revenue, and AI-driven revenue was over 100 million. The marketing industry model Blue AI continues to upgrade and continues to explore in the direction of AI Native to adapt to diverse business scenarios. According to the company's official account, Blue Label expects to achieve more than 10-fold AI-driven revenue growth in 24 years.
In 24, the good growth trend of the overseas business is expected to continue, driving the company's revenue side to maintain a good growth rate; as the advertising and marketing market recovers and gross margin stabilizes, the profit side is expected to recover further.
Profit forecasting and investment advice. We expect the company to achieve revenue of $520/62.5 billion in 23-24 and net profit of 136/480 million yuan to mother. The company is a leading digital marketing company. It actively embraces AI, promotes commercialization, considers comparable company valuations, and gives a 24-year 40X PE, corresponding to a reasonable value of 7.70 yuan/share, maintaining a “buy” rating.
Risk warning. Advertiser confidence is low; overseas advertising growth falls short of expectations; new business development falls short of expectations.