Jinwu Financial News | According to the CICC Research Report, the general traffic market: steady growth over the 3Q23 period. According to the bank's statistics, the total online time in 3Q23 also increased 4.4%, up 4.2% from the previous month. Among them, the total time of the social/short video/game circuit both achieved a year-on-year increase from a relatively high base last year. However, on the other hand, the bank observed that the slowing trend in the year-on-year growth rate of total time continued in recent months. Looking ahead to 4Q23, considering the epidemic in the same period last year and the high traffic base brought about by large-scale online events such as the World Cup, the bank expects the 4Q23 online time growth to grow or face some pressure.
Key track performance: Fundamentals remain resilient. 1) Advertising: According to the bank's statistics, online advertising increased by 20.3% in 3Q23. Among them, e-commerce and O2O platform advertising revenue increased 17.0%, and online content platform advertising increased by 22.6%. Against the backdrop that the online advertising industry has begun to gradually recover and the low base effect has weakened in the same period last year, it has maintained a high growth rate. The bank recommended focusing on the continued promotion of internal circulation advertising due to the continued high prosperity of live e-commerce, and the increase brought to the advertising industry by enabling AI tools to improve quality and efficiency.
2) Gaming: A large number of new games are driving the accelerated growth of the domestic game industry in 3Q23, mainly benefiting from the significant increase brought about by the launch of many key new games in the summer program this year; entering 4Q23, although the pace of new game launches has slowed significantly compared to the summer, product testing by leading manufacturers is still being carried out intensively. Subsequent focus on products include Tencent's “Yuan Dream Star”, “Fearless Contract Mobile Game”, etc. Furthermore, the bank believes that mini-games currently still have dividends on customer acquisition, channels, and content, and expects the revenue space for small games to reach 60 billion yuan in 2025.
3) Online recruitment: The overall recruitment market activity in 3Q23 recovered from month to month, mainly benefiting from the “gold, nine, silver, ten” recruitment season. Judging from the performance, BOSS direct recruitment flexibility was stronger, and the decline in recruitment was narrowed; looking ahead, 4Q23 may usher in the big KA signing season. Big KA represents some forward-looking expectations in the entertainment market. We recommend focusing on the progress of macroeconomic recovery.
According to the bank, judging from the 3Q23 performance, the online platform's 3Q23 revenue mostly met expectations, and the profit side exceeded expectations even more, but looking ahead to 2024, most companies still gave relatively cautious guidelines or indicated that there was still uncertainty. Looking ahead, the bank suggests focusing on five directions: 1) the development of short live video e-commerce, which still has track dividends; 2) potential opportunities brought about by marginal improvements in the product cycle; 3) a recruitment track that is expected to show greater flexibility in the context of macro-restoration; 4) the implementation of AI products in the ToC direction; and 5) the target of active shareholder returns. In the online platform sector, the bank's recommendation order is Kuaishou (01024), NetEase (09999), Tencent Holdings (00700), BOSS Direct Hiring (02076), and Meitu (01357).