Summary of Key Points
Meitu has seen double-digit growth in revenue and profit in the first half of the year driven by AI, yet its stock price has dropped by 37%. The reason is as follows: In the short term, AI has indeed helped Meitu generate revenue (with growth in its core business, an increase in paid users, and the success of new business models). However, the market is concerned that the enhanced capabilities of large-scale models in the long term could directly replace Meitu's applications. Therefore, Meitu needs to demonstrate that this growth is not just a temporary functional upgrade but a sustainable new business model, what they refer to as a "second growth curve."
1. AI Has Really Helped Meitu Generate Revenue: Double-Digit Growth in Revenue and Profit, with the Core Business Driving the Growth
In the first half of the year, Meitu's revenue reached 2.2 billion yuan (a 22% increase from last year), and its net profit was 619 million yuan (a 40% increase). This growth was mainly driven by its "image and design products," which accounted for 80% of total revenue, with a year-on-year increase of 30.9%. In terms of users, the platform had 282 million monthly active users, and the number of paid subscribers exceeded 18.44 million (a 19.7% increase), especially with rapid growth in revenue from overseas users. Simply put, AI has made Meitu's photo editing and design tools more user-friendly, leading more people to pay for membership, resulting in increased revenue and profit.
2. Productivity Tools Become a New Driver of Growth: Users Are Willing to Pay More for Efficiency-Enhancing Tools
Compared to everyday photo editing and beautification tools (used in personal scenarios), Meitu's "productivity tools" (such as AI-powered design and video generation) are more profitable because users in professional work scenarios are willing to pay for improved efficiency. Data shows that the annual recurring revenue (ARR) from these productivity tools is approximately 620 million yuan. More importantly, the consumption of "AI computing power" has increased by 113% in the first half of the year. This model involves pay-per-use services, where users need to purchase additional computing power for tasks like generating high-definition videos or complex images, with fees charged each time the service is used, primarily from the paid users of these productivity tools.
3. Pay-Per-Use Computing Power: A New Revenue Generation Method That Overcomes Subscription Limits
The traditional subscription model has limitations (for example, monthly memberships may cost only a few dozen yuan), but the pay-per-use model for computing power does not. As long as users find the features useful, they are willing to pay more as they use the service more frequently. Meitu's CFO described this as a new business model that differs from subscriptions and advertising: subscriptions involve a fixed amount of revenue, while pay-per-use models generate unlimited revenue. For instance, if a user needs to generate 10 images for a design project, a subscription member might only be able to generate 3 for free, and the remaining 7 would require purchasing additional computing power, with fees charged each time the service is used, allowing Meitu to earn more revenue.
4. The 37% Drop in Stock Price: Market Concerns About Large-Scale Models Competing with Meitu's Business
Despite the company's performance growth, its stock price has fallen by 37% this year. The market is worried that large-scale models could threaten Meitu's market position. As these models become more powerful (for example, ChatGPT can generate text and may eventually be able to generate images and perform photo editing), users might no longer need Meitu's apps and instead use these large-scale models directly. The market believes that Meitu's current growth is merely a short-term benefit from AI enhancements and not a long-term new business opportunity.
5. Meitu's Future: Proving That Growth Is Sustainable
Investors believe that Meitu's valuation is not high, and its ability to control its own technology is a competitive advantage. However, the company needs to show the market that its growth is sustainable. Meitu is currently in the process of proving that its new business models (such as productivity tools and pay-per-use computing power) are viable long-term solutions, rather than simply adding AI to its existing photo editing functions. Only then is its stock price likely to recover.
In summary, Meitu is experiencing short-term success driven by AI, but its long-term viability depends on its ability to establish itself in a market dominated by large-scale models as an irreplaceable player.