CITIC Securities International maintains a "buy" rating on KUAISHOU-W (01024), with a focus on Can-Ling AI.

Guotou Securities International released a research report saying that KUAISHOU-W (01024) met expectations in the first quarter, with a 91% increase in revenue from KeLing AI compared to the previous quarter, and March ARR exceeding 500 million USD. The company maintains the SOTA capability of KeLing AI as a current strategic focus. The bank slightly adjusted its annual revenue and profit forecast, expecting a total revenue increase of 3.7% year-on-year and adjusted net profit of 17.3 billion yuan, with a profit margin of 11.7%. They maintain a "buy" rating. Key points from Guotou Securities International: Rapid growth in KeLing AI ARR In the first quarter of 2026, KeLing AI revenue was 650 million yuan, a 333% increase year-on-year and a 91% increase quarter-on-quarter, accounting for 11.6% of revenue from other services. In March 2026, ARR was close to 500 million USD (compared to 300 million USD in January), benefiting from the strong performance of KeLing AI 3.0. The company maintains its 2026 CAPEX guide at 26 billion yuan, an increase of about 74% year-on-year (11 billion yuan). They have already conducted training and inference computational power reserves in the first quarter, which are expected to support subsequent model iterations. The focus remains on the SOTA capability of the KeLing AI model, with iteration directions including long text control, camera capabilities, image quality, native unity, etc. The bank expects a nearly 30% quarter-on-quarter increase in KeLing AI revenue in the second quarter and has raised its revenue forecast for KeLing in 2026 to 500 million USD (3.3 billion yuan). The company had previously announced that the board of directors is evaluating a restructuring plan for KeLing AI-related assets or introducing external financing. Financial forecast It is expected that total revenue will increase by 1.1% in the second quarter, with a 6.5% year-on-year increase in online marketing services, and non-e-commerce marketing service revenue growing faster than in e-commerce scenarios. Growth is driven by cartoons, lifestyle services, AI applications, etc. It is expected that other service revenues will increase by 10%, with KeLing being the main source of growth, and e-commerce commission income remaining stable year-on-year. Looking ahead to 2026, the bank has adjusted its revenue and profit forecasts, expecting a total revenue increase of 3.7% year-on-year and adjusted net profit of 17.3 billion yuan, with a profit margin of 11.7%. Risks: Rapid iteration of big model technology, leading advantage may not be sustainable; platform content ecological governance loopholes, intense competition for entertainment user time; fierce competition for e-commerce market share, and affected by macroeconomic consumption expectations.