reports
- Pierre FerraguÊ
Bible 4Q24 – Mobility & Delivery: Healthy underlying growth
Today, we are publishing the Mobility & Delivery section of our 26th Tech Infrastructure Quarterly Bible. The Tech Bible is a must-read for any tech investor, as it summarizes the quarterly earnings reports from the over 140 companies we track, providing an update on our key perspectives and convictions. Later this week we will publish sections on Memory, Semicap, Enterprise IT, PC. Ride-sharing bookings decelerated slightly but still posted robust double-digit growth, while delivery bookings a...
- Jin Yoon
BIDU 4Q24 Results: AI Cloud Remains Resilient
What’s new: Baidu’s reported 4Q24 top-line results that were largely in line with consensus and our expectations. Baidu Core ad rev growth could potentially bottom out in 4Q24 and recover throughout 2025 partly driven by monetization of gen-AI search ads. AI Cloud could remain resilient partly driven by demand for gen-AI related services. We maintain our PT at USD110. Analysts: Jin Yoon
- Julia Pan Mengyao
- Ming San Soong
Baidu Inc (9888 HK): 4Q24: Solid earnings beat and strong AI cloud rev...
Baidu’s 4Q24 earnings beat expectations. Revenue dipped 2% yoy to Rmb34.1b, in line with consensus estimate. Gross margin inched down 3ppt yoy to 47.2%, within consensus expectation. Non-GAAP operating profit was Rmb5b, down 29% yoy, while non-GAAP operating profit margin came in at 15%. Non-GAAP net profit plummeted 13% yoy to Rmb6.7b, albeit surpassing consensus estimate by 39%. Maintain HOLD with an unchanged target price of HK$93.00 (US$103.00).
- Damon Shen
- Greater China Research Team
- Jieqi Liu
- Julia Pan Mengyao
- Ming San Soong
Greater China Daily: Wednesday, February 19, 2025
KEY HIGHLIGHTS Results Baidu Inc (9888 HK/HOLD/HK$90.20/Target: HK$93.00) Baidu’s 4Q24 earnings beat expectations. Revenue dipped 2% yoy to Rmb34.1b, in line with consensus estimate. Gross margin inched down 3ppt yoy to 47.2%, within consensus expectation. Non-GAAP operating profit was Rmb5b, down 29% yoy, while non-GAAP operating profit margin came in at 15%. Non-GAAP net profit plummeted 13% yoy to Rmb6.7b, albeit surpassing consensus estimate by 39%. Maintain HOLD with an unchanged target p...
- Julia Pan Mengyao
- Ming San Soong
China Internet: Growth potential and AI development trends following e...
Amid geopolitical uncertainties, the emergence of DeepSeek models have ignited a major AI industry shake-up, garnered investor attention and drawn wide developer interest in the Chinese AI industry as it lowers the technical and financial barriers in deploying LLM. An increasing number of global hyperscalers and application companies have facilitated the deployment of DeepSeek and Qwen models, further expanding their accessibility and adoption. Maintain MARKET WEIGHT.
- Julia Pan Mengyao
- Ming San Soong
Baidu Inc (9888 HK): 4Q24 preview: Online ad weakness persists; poised...
Baidu’s 4Q24 results will be released on 18 Feb 25. We forecast 4Q24 revenue dropping 4% yoy, mainly dampened by a subdued macro backdrop. Management expects online ad revenue to drop at a high single digit yoy in 4Q24, deepening the decline from 3Q24. However, AI Cloud revenue growth is guided to ramp up in 4Q24 and maintain its double-digit growth in 2025, with GenAI now accounting for 11% of cloud revenue. Maintain HOLD with a lower target price of HK$80.00 (US$89.00).
- Carol Dou Xiao Qin
- Greater China Research Team
- Julia Pan Mengyao
- Kenny Yong Hui Lim
- Ming San Soong
- Roy Chen Chengzhi
- Shirley Wang Xueyi
- Stella Guo Yuting
- Sunny Chen
Greater China Daily: Monday, January 27, 2025
KEY HIGHLIGHTS Sector Aviation: Airlines Based on their preliminary earnings estimates, all three airlines remained in a loss-making position for 2024. This is below our expectations as we were expecting Air China and CSA to record slight profits. The losses were likely due to the sector’s overcapacity situation, but we remain hopeful for the sector’s turnaround in 2025 helped by further demand growth. Having said that, a moderate earnings recovery is not enough to resolve the airlines’ balanc...
- Jin Yoon
BIDU 4Q24 Preview: Lowering BIDU Core Margin Estimates
What’s New: We nudge down our 4Q24 and 1Q25 Baidu Core non-GAAP OPM estimates partly to reflect the impairment losses related to JIDU in 4Q and potential investments in user acquisitions related to search and other consumer-facing related products in 1Q. Analysts: Jin Yoon
- Julia Pan Mengyao
- Ming San Soong
China Internet: 1H25 outlook shaped by implications of fiscal stimuli ...
We saw largely in-line top-line growth across companies in 3Q24, mainly pressured by a lukewarm macro environment, but with earnings beat thanks to enhanced efficiency from AI integration. Alongside pending visibility on further domestic supportive policies, we believe the key 2025 highlights are: a) re-acceleration of e-commerce GMV growth, b) potential upside in ad take rate monetisation, c) rejuvenation of online games grossing, and d) sustained travel enthusiasm. Maintain MARKET WEIGHT.
JD JD.COM INC. SPONSORED ADR CLASS A
K3SD BAIDU INC SPONSORED ADR CLASS A
A117ME ALIBABA GROUP HOLDING LTD. SPONSORED ADR
3K1 KINGSOFT CORP. LTD.
00700 TENCENT HOLDINGS LTD.
PDD PINDUODUO INC. SPONSORED ADR CLASS A
03690 MEITUAN CLASS B
00780 TONGCHENG-ELONG HOLDINGS LIMITED
TCOM TRIP.COM GROUP LTD. SPONSORED ADR
BEKE KE HOLDINGS INC. SPONSORED ADR CLASS A
09988 ALIBABA GROUP HOLDING LTD.
09999 NETEASE INC
09618 JD.COM INC. CLASS A
01024 KUAISHOU TECHNOLOGY CLASS B
09888 BAIDU INC
02423 KE HOLDINGS INC.
09961 CTRIP.COM INTERNATIONAL
- Jin Yoon
BIDU 3Q24 Results: Monetization of Gen-AI Search Could Take Time to Ma...
What’s new: Baidu’s reported 3Q24 top-line results that were largely in line with consensus and our expectations. Baidu Core ads could remain challenging in 4Q partly due to macro and limited monetization related to gen-AI search. AI Cloud rev growth could accelerate in 4Q partly driven by gen-AI related revs. We lower our PT from USD130 to USD110 amid lowered outlook. Our updated PT of USD110 implies 10.6x FY25E P/E. We maintain our BUY rating. Analysts: Jin Yoon
- Julia Pan Mengyao
- Ming San Soong
Baidu Inc (9888 HK/): 3Q24: Earnings miss on AIGC investment; expect s...
Baidu’s 3Q24 results came in below expectations. Revenue grew 3% yoy to Rmb33.6b, in line with consensus estimate. Gross margin inched down 2ppt yoy to 51.1%, within consensus expectation. Non-GAAP operating profit was Rmb7b, down 8% yoy, while non-GAAP operating profit margin came in at 21%. Non-GAAP net profit plummeted 19% yoy to Rmb5.9b, missing consensus estimate by 6%. Maintain HOLD with an unchanged target price of HK$90.00 (US$100.00).
- Bella Lu Yifei
- Colin Lee
- Gigi Cheuk
- Greater China Research Team
- Johnny Yum Chung Man
- Julia Pan Mengyao
- Kate Luang
- Ken Lee
- Ming San Soong
- Shirley Wang Xueyi
- Stella Guo Yuting
Greater China Daily: Friday, November 22, 2024
KEY HIGHLIGHTS Sector Automobile China’s PV insurance registrations grew 29% yoy, 15% mom and 14% wow during 11-17 Nov 24. PEV market share dipped 2.6ppt wow to 51.5%. BYD's price cuts aim to boost sales but risk pressuring 4Q24 margins. The NDRC indicated support for ICE-cars, the first time in recent years. The Guangzhou Auto Show highlighted record-breaking figures and new trends in technology, models and pricing. Maintain MARKET WEIGHT. Top BUYs: Geely, Fuyao, and Desay SV. IT Hardware Co...
- Julia Pan Mengyao
- Ming San Soong
China Internet: Encouraging monetisation visibility from adtech and LL...
Lately, internet companies convened their respective AI conferences, unveiling a wide range of upgraded AI products that showcase their AI infrastructure development and AI monetisation potential. We opine that the prevailing trend in adtech upgrades focuses on enhancing marketing efficiency and driving GMV growth, resulting in monetisation improvement. We remain optimistic in view of the favourable regulatory environment and industry development. Maintain MARKET WEIGHT.
- Julia Pan Mengyao
- Ming San Soong
China Internet: Key takeaways from marketing trip.
The key concerns of investors include the sustainability of the recent rally and potential fundamental changes upon policy rollout. We think a valuation repair is underway with the upcoming 11.11 campaign and 3Q/4Q24 results release as a critical juncture. Investors are also becoming increasingly optimistic on mega-cap names such as Tencent, Meituan, Alibaba and JD in view of a favourable regulatory backdrop and stabilised competitive environment. Maintain MARKET WEIGHT.
JD JD.COM INC. SPONSORED ADR CLASS A
K3SD BAIDU INC SPONSORED ADR CLASS A
A117ME ALIBABA GROUP HOLDING LTD. SPONSORED ADR
3K1 KINGSOFT CORP. LTD.
002230 IFLYTEK CO. LTD. CLASS A
00700 TENCENT HOLDINGS LTD.
PDD PINDUODUO INC. SPONSORED ADR CLASS A
03690 MEITUAN CLASS B
00780 TONGCHENG-ELONG HOLDINGS LIMITED
2013 WEIMOB INC
TCOM TRIP.COM GROUP LTD. SPONSORED ADR
BEKE KE HOLDINGS INC. SPONSORED ADR CLASS A
09988 ALIBABA GROUP HOLDING LTD.
09999 NETEASE INC
09618 JD.COM INC. CLASS A
01024 KUAISHOU TECHNOLOGY CLASS B
09888 BAIDU INC
02423 KE HOLDINGS INC.
09961 CTRIP.COM INTERNATIONAL
- Julia Pan Mengyao
- Ming San Soong
China Internet: Government policy rollout to boost consumption and dri...
In view of a stronger-than-expected government policy rollout, we reckon that the improved consumption sentiment will benefit e-commerce, local life services and OTA companies. In 2H24, we expect the undemanding valuations of internet companies to be repaired by shareholder returns, cross-border expansion and easing competition. Meanwhile, we believe monetisation momentum will be fuelled by AIGC development and adtech upgrades. Maintain MARKET WEIGHT.
JD JD.COM INC. SPONSORED ADR CLASS A
K3SD BAIDU INC SPONSORED ADR CLASS A
A117ME ALIBABA GROUP HOLDING LTD. SPONSORED ADR
3K1 KINGSOFT CORP. LTD.
002230 IFLYTEK CO. LTD. CLASS A
00700 TENCENT HOLDINGS LTD.
PDD PINDUODUO INC. SPONSORED ADR CLASS A
03690 MEITUAN CLASS B
00780 TONGCHENG-ELONG HOLDINGS LIMITED
2013 WEIMOB INC
TCOM TRIP.COM GROUP LTD. SPONSORED ADR
BEKE KE HOLDINGS INC. SPONSORED ADR CLASS A
09988 ALIBABA GROUP HOLDING LTD.
09999 NETEASE INC
09618 JD.COM INC. CLASS A
01024 KUAISHOU TECHNOLOGY CLASS B
09888 PINDUODUO PDD US
02423 BAIDU INC
09961 KE HOLDINGS INC.
CTRIP.COM INTERNATIONAL
- Julia Pan Mengyao
- Ming San Soong
Baidu Inc (9888 HK): Key highlights from Baidu Cloud Intelligence Conf...
Baidu Cloud Intelligence Conference 2024 was held on 25-26 September in Beijing. Baidu upgraded its two key AI infrastructures, Qianfan Large Model Platform 3.0 and AI Computing Platform 4.0, focusing on computing power, LLM, and AI applications. Meanwhile, the company also enhanced three major AI-native applications including intelligent customer service Keyue, digital human Xiling and code assistant Baidu Comate. Maintain HOLD with a slightly higher target price of HK$90.00 (US$100.00).
- Carol Dou Xiao Qin
- Damon Shen
- Greater China Research Team
- Jieqi Liu
- Julia Pan Mengyao
- Ming San Soong
- Sunny Chen
Greater China Daily: Friday, September 27, 2024
KEY HIGHLIGHTS Results New World Development (17 HK/SELL/HK$8.19/Target: HK$7.02) NWD reported HK$11.8b in attributable loss from continuing business for FY24. Dividend has been halted to accelerate deleveraging. Although its IP portfolio has remained resilient, sluggish Hong Kong property sales and high net gearing remain as key concerns. The new management has pledged to improve profitability. We think profitability recovery and dividend normalisation will take some time. Maintain SELL wit...
- Jin Yoon
BIDU 2Q24 Results: Ad Outlook Remains Challenging in 2H
What’s new: Baidu’s reported 2Q24 top-line results that were largely in-line with consensus and our expectations. Baidu Core ads could remain challenging in the 2H partly due to macro, competition, and limited monetization related to generative-AI search. AI Cloud rev growth could accelerate in 3Q partly driven by generative-AI related revs. We lower our PT from USD170 to USD130 due to limited visibility in ad recovery. Our updated PT of USD130 implies 12.5x FY25E P/E. We maintain our BUY rating...
- Julia Pan Mengyao
- Ming San Soong
Baidu Inc (9888 HK): 2Q24: Earnings beat; modest online ad growth; sol...
Baidu’s 2Q24 results were within expectations. Revenue remained flattish yoy at Rmb33.9b, in line with consensus estimate. Gross margin inched down 1ppt yoy to 51.7%, within consensus expectation. Non-GAAP operating profit was Rmb7.5b, up 2% yoy, while non-GAAP operating profit margin came in at 22%. Non-GAAP net profit declined 8% yoy to Rmb7.4b, exceeding consensus estimate by 11%. Maintain BUY with a lower target price of HK$110.00 (US$123.00).
- Bella Lu Yifei
- Carol Dou Xiao Qin
- Damon Shen
- Greater China Research Team
- Jieqi Liu
- Johnny Yum Chung Man
- Julia Pan Mengyao
- Ken Lee
- Kenny Yong Hui Lim
- Ming San Soong
- Sunny Chen
Greater China Daily: Friday, August 23, 2024
KEY HIGHLIGHTS Results AAC Technologies (2018 HK/BUY/HK$31.25/Target: HK$38.10) AAC’s 1H24 earnings grew 257% yoy to Rmb537m, significantly exceeding our and consensus estimates. The strong growth was mainly driven by an all-around beat in gross margins across all business segments amid better end-demand, specs upgrades and a competitive landscape. Going forward, the product mix improvements, AI smartphone upgrades, and automotive business will continue to drive earnings recovery from 2H24-2...
K3SD BAIDU INC SPONSORED ADR CLASS A
01299 AIA GROUP LIMITED
A2XN AAC TECHNOLOGIES HOLDINGS INC.
M3I MINTH GROUP LIMITED
06098 COUNTRY GARDEN SERVICES HOLDINGS CO. LTD.
09999 NETEASE INC
2269 WUXI BIOLOGICS (CAYMAN) INC.
09888 BAIDU INC
600699 NINGBO JOYSON ELECTRONIC CORP
JOYSON ELECTRONICS CORP
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