Kuaishou Technology (1024) Q3 2024 earnings summary

Executive summary

• Achieved 408 million average DAUs and 714 million MAUs in Q3 2024, with DAUs up 5.4% year-over-year and strong user engagement, including 132 minutes average daily time spent per DAU.

• Total revenue grew 11.4% year-over-year to RMB31.1 billion, driven by online marketing and e-commerce.

• Adjusted net profit rose 24.4% year-over-year to RMB3.95 billion; group-level net profit up 49.9% to RMB3.3 billion, with a margin of 12.7%.

• Continued investment in AI, with Kling AI reaching over 5 million users, monthly revenue exceeding RMB10 million, and the launch of upgraded large language and video models.

• E-commerce GMV rose 15.1% year-over-year to RMB334.2 billion, with monthly active merchants up over 40% and strong growth in pan-shelf-based e-commerce.

Financial highlights

• Online marketing services revenue increased 20% year-over-year to RMB17.6 billion, representing 56.6% of total revenue.

• Live streaming revenue was RMB9.3 billion, a 3.9% decline year-over-year, but the rate of decline narrowed and partner talent agencies increased.

• Overseas revenue doubled year-over-year to RMB1.33 billion, with operating loss narrowed by 75.9% and DAUs in Brazil up 9.7%.

• Gross margin improved to 54.3%, up 2.6 percentage points year-over-year.

• Operating net cash flow was RMB7.7 billion in Q3; total available funds reached RMB86.7 billion.

Outlook and guidance

• Confident in continued user and revenue growth, focusing on AI innovation, user-centric strategies, and ecosystem expansion.

• Expect Q4 selling and marketing expenses to rise due to e-commerce promotions, but as a share of revenue, both selling/marketing and R&D expenses will decline.

• Anticipate rapid revenue growth for Kling AI in 2025 and further overseas expansion, especially in Brazil.