Kuaishou Technology Q3 2023 Earnings Call Transcript: Strong Growth, New Strategies Planned

Kuaishou Technology released its Q3 2023 earnings report on November 21th.

1. Kuaishou reported a robust financial performance in Q3 2023, with group-level net profit increasing quarter-over-quarter to RMB2.18 billion and adjusted net profit of RMB3.17 billion, attributed to consistent growth across core businesses and financial management efforts. The company's profitability was bolstered by robust revenue growth in online marketing, e-commerce, and live streaming, as well as ongoing optimization efforts to enhance operating efficiency. Additionally, the company's refined operations for vertical industries improved the effectiveness of marketing services for native e-commerce merchants, resulting in a 26.7% increase in revenue from online marketing services. E-commerce GMV increased by 30% year-over-year due to growth in active merchants and paying users.

2. Kuaishou continued to prioritize user growth and ecosystem construction, achieving high-quality growth across both its user base and traffic due to efficient user strategies, extensive content offerings, and continuous algorithm optimization. Monetization progress was also made through exceptional online marketing revenue growth, driven by upgrades to commercial products, technology development in algorithms, and deeper operation in various vertical industries.

3. Kuaishou has made substantial progress in industries such as media information, education and training, and healthcare by refining industry-specific operations. The company is focused on cultivating small- and medium-sized merchants within its ecosystem and improving the synergy between marketing and e-commerce traffic to amplify the long-term value of merchants' investment. Kuaishou continues to demonstrate unique resilience in its e-commerce business by enhancing buyer conversion efficiency and providing full support to merchants throughout the process.

4. In Q3 2023, Kuaishou's external enterprising revenue growth accelerated year-over-year, driven by solid progress in media information, education and training, and health care industries. Looking towards future strategies, Kuaishou plans to implement industry-specific and refined operations, creating native marketing content, fostering synergy between commercial and organic traffic, and leveraging AI technology to improve post-click conversion rates.

5. Kuaishou experienced significant inflow of RMB7.7 billion in Q3, with total available funds amounting to RMB55.4 billion as of the end of Q3. Kuaishou announced a HKD4 billion share repurchase plan in May of this year and has cumulatively repurchased approximately HKD907 million worth of shares. Kuaishou's AI strategy is progressing as expected, with leading language model capabilities and various LLM applications in content, consumption, supply, and monetization scenarios.