In 2023, AI emerged as the new growth engine for Meitu Corporation's performance.
On March 15, Meitu Corporation disclosed its 2023 financial report. The company achieved a total revenue of CNY 2.7 billion, representing a year-on-year increase of 29.3%. After adjustments, the net profit attributable to the equity holders of the parent company reached CNY 370 million, marking a substantial growth of 233.2% compared to the previous year.
The financial report indicates that in 2023, Meitu's revenue from image and design products, primarily driven by paid subscriptions, amounted to CNY 1.33 billion, a 52.8% year-on-year increase. Additionally, advertising revenue reached CNY 760 million, reflecting a 20.5% year-on-year growth, while the beauty industry solutions business generated CNY 570 million in revenue, marking a 29.1% year-on-year increase.
The report further highlights that the substantial increase in net profit was primarily driven by the image and design products business, which is predominantly based on paid subscriptions. This segment recorded a full-year revenue of CNY 1.33 billion, reflecting a 52.8% year-on-year growth. The main revenue model for this segment is through paid subscriptions.
Simultaneously, AI technology introduced more engaging experiences for Meitu users, significantly enhancing users' efficiency in creating digital content. This led to a rapid increase in the penetration rate of paid subscribers for the image product portfolio, consequently driving a substantial growth in subscription revenue. As of December 31, 2023, Meitu's paid subscription user base exceeded 9.11 million, reaching a historical high and marking a 62.3% year-on-year growth.
Leveraging the foundation of MiracleVision, an AI product launched in June 2023, Meitu has established an AI product ecosystem comprising infrastructure, ecology, and applications. Currently, MiracleVision has been filed with the "Interim Measures for the Administration of Generative Artificial Intelligence Services" and is applied across all Meitu products. The model's capabilities are fully open to industry clients and partners through APIs, SDKs, SaaS, and model training.
According to Wu Xinhong, Meitu's Chairman, AI-backed features account for as much as 83% of all Meitu products. "We have observed that AI significantly enhances subscription conversion rates, accelerating profit growth, fundamentally by shortening the time for new feature launches and improving innovation efficiency, thereby delivering higher product value to users and further promoting subscription conversions."
"After more than a year of rapid development in AIGC, we have confirmed that AI will lead a new round of productivity surge, also known as a new industrial revolution," Wu Xinhong stated. He predicts that in the future, the penetration rate of AI will continue to increase, gradually integrating into more fields and deeply merging with more products, further enhancing productivity across multiple industries.
Moreover, on the path to globalization, Meitu has achieved steady growth. Presently, Meitu has a presence in 195 countries and regions globally and ranks at the forefront of non-gaming companies in terms of outbound revenue.
"This year marks the beginning of the second decade of our globalization journey," Wu Xinhong emphasized when discussing Meitu's global experience. He stressed that the key to Meitu's success on a global scale lies in initiating the globalization process early. He emphasized that the so-called "learning in the battle" is gradually honed through continuous business operations. Hence, the earlier a company begins its globalization journey, the deeper its accumulated experience and capabilities.
Furthermore, during the globalization process, companies must address the challenges posed by cultural differences and diverse needs among different countries and regions. Wu Xinhong also stated that to meet these diverse needs, adaptive strategies need to be adopted in product design and development. However, this does not imply that Meitu needs to completely abandon the search for common global user needs or industry commonalities, as the two are not mutually exclusive. From the perspective of software company efficiency, he believes that identifying and utilizing global user commonalities or industry commonalities can more effectively utilize resources and create standardized products.
As of the time of writing, Meitu's stock is priced at HKD 3.7 per share, with a total market value of HKD 16.568 billion.