Summary of Key Points
Meitu, which once became a national sensation with its photo editing tools and had a market value close to 10 billion Hong Kong dollars but almost went bankrupt, has made a comeback in the AI era by adopting a strategy of "internal entrepreneurship" and focusing on "image productivity." The 2025 financial report shows an increase in total revenue by 28.8% to 3.86 billion yuan, and net profit by 64.7% to 965 million yuan. The number of paid users reached a new high of 16.91 million, with overseas monthly active users exceeding 100 million for the first time. By cutting off less profitable businesses and using a small team of fewer than 10 people with an initial investment of 10 million yuan, Meitu launched niche products such as MVLAND (AI-based MV generation), Picchi (AI photo editing that mimics user preferences), and real-person photo enhancement services. The company also considered the needs of users who are not familiar with AI, shifting from being a simple photo editor to a user-friendly image productivity platform, thus avoiding direct competition with giants like ByteDance and Kuaishou.
Detailed Analysis
1. From "Market Value Collapse" to "AI Comeback": What Was the Key to the Improvement in Performance?
Meitu's turnaround was not due to simply riding on the AI trend; instead, it accurately identified the demand for "image productivity." In the past, Meitu tried various areas (such as social media and hardware) without success. It wasn't until 2023, under the leadership of Wu Xinhong as chairman, that the company focused on image and AI technologies, expanding its products from everyday use (e.g., ordinary people editing photos for social media) to more productive applications (e.g., e-commerce owners creating posters, video bloggers producing voiceovers, musicians making MVs).
Why did focusing on productivity lead to growth? Because it directly helped users generate revenue. For example, e-commerce sellers could use Meitu's tools to design promotional materials, earning hundreds of thousands of yuan per month for just a few hundred yuan in membership fees, resulting in high user willingness to pay. Data shows that revenue from productive use cases is 20 times higher than that from everyday use cases, which was the main driving force behind the performance improvement.
2. Internal Entrepreneurship: How Does a Small Team with 10 Million Work?
Meitu's internal innovation mechanism is akin to supporting several small startups:
- Small Teams and Start-up Funds: Teams of fewer than 10 people (even two-person teams for product development) can apply for 10 million yuan in start-up funds to work on projects like a startup would.
- Silicon Valley-style Evaluation: If the team generates annual stable revenue of over one million US dollars, they receive further funding; otherwise, they are disbanded or reassigned.
- Flexible Approaches: The company provides flexible support, such as special credit cards for direct payment of external model fees without lengthy approval processes.
- Resource Coordination: A "Meitu Small Tribunal" (for teams of up to 10 people) is established to resolve resource conflicts, prioritizing maximum company benefits and innovation.
This approach retains the resource advantages of a large company while maintaining the agility of a small team, allowing for rapid trial and error in developing successful products.
3. User Insights: Behind the Counterintuitive Approaches Lie Real Needs
Meitu's product innovations are not based on guesswork but on thorough understanding of user needs:
- Real-person Photo Editing: While many companies talk about AI replacing human tasks, Meitu offers real-person photo editing services for users who cannot use AI tools. For example, small-town youths and offline businesses prefer to pay for professional print services rather than learning to use AI tools.
- MVLAND: This service addresses the need for low-cost MVs for less well-known musicians. Since many independent artists lack distribution channels, they often post their music on YouTube or TikTok, but creating MVs is expensive (costing thousands of yuan). MVLAND can generate MVs in bulk and help distribute them on social media platforms.
- Picchi as a Separate App: Although it could be integrated into Meitu XiuXiu, it was made as a standalone app. This is because Meitu XiuXiu is a mature product with a large user base, and the independent team can focus on developing this feature without additional pressure, integrating it later when the technology is fully developed.
These insights come from direct interaction with users—such as Chen Jianyi discovering that users in print shops couldn't use AI tools, similar to how Pinduoduo identified unmet needs in the lower-tier market that Taobao missed.
4. Positioning in the AI Era: Not "China's Adobe," but a "User-friendly Image Tool"
Previously, Meitu aimed to compete with Adobe, but now it has changed its strategy. Adobe's tools are too complex for ordinary users, so Meitu focuses on creating user-friendly products that solve specific problems in various scenarios:
- E-commerce sellers need quick poster creation; Meitu's tools can generate them with one click.
- Video bloggers need voiceover scripts; Meitu provides tools for easy creation.
- Musicians need low-cost MVs; MVLAND can handle this efficiently.
Meitu also believes that the boundaries between consumer and business segments will blur, so it is focusing on overseas business users—its first-ever 100 million monthly active users abroad is a sign of this trend.
5. Is Culture More Important than Technology?
Chen Jianyi emphasizes that Meitu's core competitiveness lies not in user base or technology but in its "culture":
- User Focus: The company always understands real user needs, rather than being driven by the idea that AI will replace everything.
- Passion for Image: Many team members are image enthusiasts, which influences the quality of products.
- Traditional Product Managers: In the AI era, Meitu values product managers who can understand user needs, not just those skilled in using AI tools. Innovation that is disconnected from user realities is often ineffective.
This cultural focus has helped Meitu avoid competition with giants like ByteDance and Kuaishou while maintaining its position in the AI landscape.
Conclusion
Meitu's comeback is no accident. By adopting internal entrepreneurship, focusing on user needs, and creating user-friendly tools, it has found its place in the AI era. For other traditional internet companies, this case study serves as a reference for finding their own role in the new technological landscape.