2021Q4 performance outlook: we expect the company's total 2021Q4 revenue to be 22.74 billion yuan, an increase of 25.6% over the same period last year, with an adjusted net profit of 4.02 billion yuan and a profit and loss rate of 17.8%. The net loss rate is better than that in the third quarter, narrowing more than expected. In terms of segments, we expect the live broadcast business to remain stable year-on-year, rising slightly to 7.93 billion yuan compared with the same period last year; online marketing business will grow by 50% to 12.767 billion yuan compared with the same period last year; and other businesses will increase by 21% year-on-year to 2.043 billion yuan. Combined with the results of the first three quarters, we expect annual revenue of 80.137 billion yuan in 2021, an increase of 36% over the same period last year. Revenue from the live broadcast business will fall 8.37% year-on-year to 30.43 billion yuan, online marketing business will grow 95% to 42.609 billion yuan, and other businesses will grow 91% to 7.098 billion yuan.
The proportion of income in the cost side has an obvious optimization trend, and the logic of reducing cost and increasing efficiency has been verified.
In the fourth quarter, we expect the gross margin to be the same as in the third quarter, at about 41%. The rate of sales and R & D expenses is lower than that of Q3, the absolute value remains stable, and the rate of administrative expenses is relatively stable. It is estimated that the sales / R & D / administrative expense rates for the fourth quarter will be 48%, 19% and 4% respectively.
The optimization of the expense side shows the results of Kuaishou Technology's organizational structure adjustment and operational efficiency improvement, and the future gross profit margin, sales expense rate and net loss rate are expected to continue to be optimized.
The overall flow of Q4 is stable, and the efficiency of customer acquisition and retention continues to improve. The growth of the short video industry is coming to an end, we expect Q4 DAU to remain at around 320 million, MAU steady development, Q4 slightly higher than the previous month. The platform will further refine the operation of users and pay attention to the optimization of commodity content and services to enhance the stickiness and activity of users. The duration of user use reaches its peak in Q3, and it is expected that the duration of Q4 users will fluctuate slightly, but remain basically stable at about 114 minutes. Kuaishou Technology on the content side of the first quarter of 22 may develop content ecology around the theme of the Winter Olympic Games, and the total flow is expected to grow by more than 20%.
Advertising business Q4 continued high growth, + 50% year-on-year, the growth rate in line with the guidelines. In the macro environment and regulatory tightening, Kuaishou Technology advertising growth rate is still faster than the industry average, the driving force is mainly in: 1) Q4 is the peak season of e-commerce, e-commerce GMV to drive the proportion of internal circular advertising continues to increase; 2) Kuaishou Technology continues to make efforts in brand advertising, brand advertising increment is obvious; 3) the flow market remains stable, 22 years are expected to further improve. AdloadQ4 is relatively stable and may increase slightly in 22 years, driving advertising revenue. Depending on the CPM of the market, the total growth rate of the advertising business in 2022 is expected to fluctuate between 30% and 40%.
E-commerce is developing steadily, and GMV for the whole year is expected to exceed 650 billion. We expect Q4 e-commerce GMV to grow by 22% year-on-year to 216.1 billion yuan, and the annual e-commerce GMV in 2021 will exceed 650 billion yuan. The platform Take rate is relatively stable, and the take rate for the whole year of 2021 is stable at around 1%. Since Kuaishou Technology e-commerce proposed "trust in e-commerce, brands and service providers" this year, the ecology of e-commerce has continued to improve. A new "industrial belt" will be added in 2022.
Strategy, e-commerce business construction continues to make efforts, e-commerce is expected to continue the momentum of high growth in 2022, the annual GMV is expected to grow by 40% year-on-year to 910 billion yuan. The long-term goal of GMV remains unchanged and is expected to exceed 2 trillion yuan in 2025.
The growth rate of the live broadcast industry has changed from negative to positive, and Q4 live broadcast business revenue is expected to stop falling compared with the same period last year. Kuaishou Technology focuses on improving the quality of live content. Increase cooperation with trade unions, optimize distribution efficiency, and ensure a steady increase in live broadcast business. Expected revenue for 2021 fell 8 per cent year-on-year to 30.43 billion yuan. Thanks to the introduction of more live streaming associations and the exposure of public domain traffic, the live broadcast business is expected to grow slightly by 5% and 7% in 22 years.
Kuaishou Technology and Meituan reached a strategic cooperation to inject new vitality into local life. Meituan will launch Meituan Mini Program on Kuaishou Technology's open platform, providing Meituan merchants with complete service capabilities such as package, voucher, booking and other commodity display, online trading and after-sales service. Kuaishou Technology users will be able to reach directly through Meituan Mini Program. With the complementary advantages of the two giants, Meituan can make up for his deficiency in content through Kuaishou Technology diversion, while Kuaishou Technology can further realize the flow through Meituan's mature local life service system to speed up the formation of a commercial closed loop of "content + fans + business". Kuaishou Technology's "old friend" acquaintance culture is also consistent with the characteristics of the local life business, and the local life business is expected to further expand.
Profit forecast: we expect the company's revenue from 2021 to 2023 to be 80.137 billion yuan, 99.714 billion yuan and 115.939 billion yuan respectively, with year-on-year growth rates of 36.3%, 24.4% and 16.2%, respectively. We use SOTP valuation: live / Advertising / ecommerce gives 1x/6x/5x 's PCMS, with a combined valuation of 428.1 billion, maintaining a "buy" rating.
Risk tips: user growth is lower than expected; industry competition is intensified; Internet regulatory risks; commercialization is not as expected.