Event: on October 24, the company released the third quarter report, the company achieved a total operating income of 2.895 billion yuan in the first three quarters,-12.04% year-on-year; the net profit attributed to shareholders of listed companies was 552 million yuan, + 80.43% year on year, and the performance was in line with expectations.
Profitability continued to repair, gross profit margin increased significantly. 1) in the first three quarters of 2023, the company achieved a total operating income of 2.895 billion yuan, compared with-12.04% of the same period last year. In the first three quarters of 2023, the company realized a net profit of 552 million yuan belonging to shareholders of listed companies, which was + 80.43% compared with the same period last year. 2) the gross profit margin in the first three quarters of 2023 was 36.74%, an increase in 11.92pct over the same period last year. 3) the company continues to attach importance to R & D investment, achieving a sales expense rate of 6.36% in the first three quarters of 2023, year-on-year + 0.51pct, management expense rate of 5.98%, year-on-year + 0.77pct, and R & D expense rate of 7.35%, year-on-year + 0.94pct.
Significant progress has been made in the renewal of licences, laying the foundation for a rate increase in the second half of the year. According to the announcement, on July 5, 2023, the people's Bank of China published on its official website the "Public Information on the Renewal of non-Bank institutions' payment Business licenses (the sixth batch of July 2023)". Jialian payment Co., Ltd., a wholly owned subsidiary of Shenzhen Xinguodu Co., Ltd. (hereinafter referred to as "Jialian payment"), obtained this renewal, license document number: Z2011244000012, license content: bank card receipt (national), validity period:
June 27, 2022 to June 26, 2027. We believe that the company's payment license renewal has made significant progress, and the negative impact of administrative penalties on payment business development in the past three quarters is about to be eliminated.
AI multimodal technology has been deeply cultivated for many years, and a breakthrough has been made in the overseas product line. 1) according to the announcement, Xinguodu, a subsidiary of the company, has successfully launched a variety of tool products in overseas markets, relying on AI in-depth content generation and video processing technology. Based on the cutting-edge AI technologies such as image deep learning and computer vision, New Capital Intelligence constantly updates the iterative frequency of the algorithm model, which provides rich calculation examples for the model. 2) PicSo is an AI image generation tool developed by the company, which supports both the mobile side (Android and IOS) and the web side. The product has rich and easy-to-use AI image generation functions. Users only need to enter a text description in the text box, choose their favorite picture style, and directly click the generate button to generate a high-quality picture in a short time. 2) FaceMagic applications use artificial intelligence to allow faces to be replaced in videos of their choice.
Maintain a "buy" rating. According to the key assumptions, the operating income from 2023 to 2025 is expected to be 4.07 billion yuan, 4.61 billion yuan and 5.257 billion yuan respectively, and the net profit of returning mother is 761 million yuan, 928 million yuan and 1.111 billion yuan respectively.
Risk tips: core product revenue is not up to expectations; financial supervision is strengthened; new product promotion is not as expected; core assumptions are not as expected.