2025-05-28-Jefferies-金山软件（3888）_第一季度业绩弱于预期；期待即将推出的新游戏_12页_310kb

Kingsoft Corp Ltd. (3888 HK) reported 1Q25 financial results with revenue down 16% year-over-year to RMB2.3 billion, missing both market consensus and the analysts' targets. The online games segment declined 20% quarter-over-quarter due to fewer commercial updates for JX3 Online, while office software and services revenues were also below expectations. Management highlighted strategies focused on AI integration, genre expansion, and overseas growth during the conference call, with JX3 Online maintaining stable user and ARPU metrics despite the sequential revenue decline.

For the 2Q outlook, the 2Q revenue is expected to decline YoY mainly due to higher comparisons with last year's hit game, Snowbreak: Containment Zone, and adjusted operating profit margin is projected to fall on increased spending for upcoming releases like Mecha BREAK. The full-year 2025 revenue estimates remain unchanged, reflecting confidence in long-term growth drivers from Cloud and WPS segments, despite short-term challenges.

Key developments include AI upgrades at the group level, with localized operations driving overseas expansion for WPS, which grew 63% YoY in 1Q25. Risks involve weaker-than-expected game launches, slower Cloud/WPS growth, and margin pressures. The report maintains a "Buy" rating with a price target of HK$42.80 (+21% from prior target), based on SOTP valuation, incorporating upside scenarios for AI-driven Cloud and WPS growth but cautioning on potential margin risks and competitive pressures.