Incidents:
The company released its 2024 semi-annual report
Comment:
Revenue and profit grew steadily, and profit margins reached record highs
With 2024H1, the company achieved operating income of 60.383 billion yuan, a year-on-year increase of 14.0%; gross margin was 55.1%, an increase of 6.7 pct over the same period last year; adjusted net profit was 9.067 billion yuan, with a net margin of 15.0%, +9.8 pct compared to the same period last year. In the 2024Q2 quarter, the company achieved operating income of 30.975 billion yuan, up 11.6% year on year; gross margin was 55.3%, up 5.1 pct year on year; adjusted net profit was 4.679 billion yuan, net interest rate reached 15.1%, and the company's revenue and profit increased steadily.
The number of active users grew steadily, and the AI matrix enabled continuous optimization of the company's user and content ecosystem. 2024Q2, DAU, and MAU were 0.395 billion/0.692 billion, up 5.1%/2.7% year on year, the average daily usage time of a single DAU was 122 minutes, and the total usage time of Kuaishou app users increased 9.5% year over year. The company accelerated AI construction, developed an industry-leading AI matrix, and embedded in the company's multiple business scenarios. 24H1, nearly 0.02 million merchants used AI to optimize their operations on the Kuaishou platform. The company's first domestic AIGC original fantasy short drama “Miracle in the Mountains and the Sea” was broadcast for over 50 million weeks after launch. The company's search user penetration rate further increased. In 24Q2, the number of monthly active users using Kuaishou search was nearly 0.5 billion, and the number of daily searches increased by more than 20% over the same period last year.
The growth of the advertising business is in line with expectations. The e-commerce business GMV has slowed down in the online marketing business. 24Q2 achieved 17.5 billion yuan in online marketing revenue, an increase of 22.1% year on year. Combined with intelligent subsidies to increase the payment scale of users, the average daily marketing consumption of paid skits increased more than 2 times year on year, internal circulation advertising revenue also increased steadily, and the investment revenue of the 24Q2 Star Short Drama increased more than 20 times year on year. In e-commerce business, 24H1's GMV was 593.3 billion yuan, up 21% year on year. Q2 GMV reached 305.3 billion yuan in a single quarter, up 15% year on year, and the number of monthly active buyers also increased by 14.1% to 0.131 billion yuan, with a penetration rate of 18.9%. The company continued to optimize the live streaming ecosystem. 24Q2 live streaming revenue was 9.3 billion yuan, down 6.7% year on year, and the number of signed guild anchors increased 60% year on year.
Investment advice and profit forecasting
As an industry-leading content community and social networking platform, the company's commercialization capabilities continue to improve, results in cost reduction and efficiency are showing, and profits are expected to continue to be released. We expect the company's 2024-2026 adjusted net profit of 17.649/22.452/27.548 billion yuan, maintaining the company's “buy” rating.
Risk warning
User growth falls short of expectations, policy regulation risks, and new business incubation falls short of expectations.