Kuaishou: Emphasizing content-driven e-commerce marketing strategies (3Q24 Earnings Call Minutes)

Below is the $KUAISHOU-W(01024.HK) Minutes of the Q3 2024 Earnings Conference Call. For financial report analysis, please refer to《Kuaishou: How Will "Old Iron" Live Commerce Mature and What’s Next?》

I. Key Financial Highlights:

II. Detailed Conference Call Content

2.1. Management Presentation Highlights:

2.1.1 Business Progress

1) User Growth & Content Ecosystem

a. User Scale: DAUs reached 408 million, up 5.4% YoY; MAUs hit 714 million, up 4.3% YoY; average daily usage time rose to 132.2 minutes, up 7.3% YoY; daily views for short videos/livestreams neared 110 billion.

b. Content Distribution: Enhanced recommendation algorithms and vertical content (e.g., sports with 310.6B Paris Olympics exposures, 15.89B interactions; concerts like TFBOYS’ 950M-view livestreams).

c. Search: MAUs exceeded 500M post-optimization; daily searches grew 20% YoY (peak: 800M/day), driving ad revenue.

2) Online Marketing

a. Revenue: Online ads hit RMB17.6B, up 20% YoY (6th straight quarter >20% growth); active merchants using ads rose 50%+ YoY.

b. Tools: Smart ads (UAX) accounted for 50% of spend; short-video ad spend surged 300% YoY.

c. Traffic Conversion: Livestream conversion spend grew ~20% YoY in Q3.

d. Brand Partnerships: 150+ collaborations (e.g., China Mobile, FAW-VW) leveraging Olympics.

3) E-commerce

a. GMV: Total GMV hit RMB334.2B, up 15.1% YoY; short-video GMV jumped 40%; "shelf commerce" GMV share rose to 27%, up 45%.

b. Merchants: New sellers grew 30% YoY; monthly active sellers +40%, SKUs +20%.

c. KOLs: "Shopping Squad" tool boosted orders/user by 25%; SME KOLs’ GMV grew 27% YoY during 818 Festival.

d. Paying Users: Monthly active buyers reached 133M, up 12.2% YoY.

4) Livestreaming

a. Revenue: RMB9.3B, with narrowing YoY decline.

b. Diversification: Added local culture/gaming (3M+ game streamers).

5) Overseas

a. Brazil DAUs +9.7% YoY; revenue RMB1.33B, +104.1%; ops loss narrowed 75.9% to RMB153M.

2.1.2 Financials

1) Overall: Revenue RMB31.01B (+11.4% YoY), gross margin 54.3% (+2.6pp); net profit RMB3.3B (+50%).

2) Segment Revenue: Ads 56.6% share (RMB17.6B, +20%); e-commerce RMB4.2B (+17.5%).

3) Costs: R&D spend RMB3.1B (+4.5%), 10% of revenue.

4) Buybacks: Repurchased HK$3.98B shares (2.1% float).

2.2. Q&A

Q: Updates on AI model "Kling"? Data and monetization roadmap?

A: Kling hit 5M users since June, generating 51M videos/150M images. September MAU >1.5M; API services launched with RMB10M+ monthly revenue. Expect rapid 2025 growth.

Q: DAU/usage trends post-400M milestone?

A: Focus on retention/algo efficiency, not just duration. Three strategies: 1) Optimize traffic mix, 2) Boost social/private traffic, 3) Vertical content.

Q: Short-video ads’ sustainability?

A: Spend tripled YoY (peaking RMB40M/day). IAA/IAP models to drive growth; targeting RMB100B+ market by 2027.

Q: 11.11 performance?

A: Record GMV via content-shelf synergy. Subsidized 20B video views, RMB3B user/merchant incentives. 2.5K+ livestreams surpassed RMB1M GMV.

Q: Local services outlook?

A: Paying users +28% QoQ, GMV +26%. Revenue 2.5x YoY; targeting city-level breakeven.

Q: Opex increase?

A: Higher subsidies for ads/e-commerce (ROI-driven). Q4 seasonal rise expected, but efficiency improving.

Disclosures: Dolphin Research Disclaimer