4q25e 预览：预计收入和利润将在2025年第四季度恢复

earnings to recover in 4Q25 4Q25E preview:expect both revenue andearnings to recover in 4Q25 TargetPriceUS$2.75(Previous TPUS$2.65)Up/Downside36.8%Current PriceUS$2.01 We expect iQiyitotal revenue to regain growth momentum in 4Q25. We forecast4Q25E totalrevenue to grow by 2% YoY and 1% QoQ to RMB6.77bn, mainlydriven by the recovery of membership and content distribution businesses. Weexpect iQiyi to record non-GAAP net income of RMB93mn in 4Q25E, up fromnon-GAAP net loss of RMB59/148mn in 4Q24/3Q25, thanks to operatingleverage and enhanced efficiency. Besides, iQiyi’s innovative businesses suchas overseas business, micro drama and IP derivatives continued to makepositive progress. Overall, we lift FY25-27E non-GAAP net income forecaststoRMB0.3/1.0/1.3bn(RMB0.1/1.0/1.2bn previously),in view of the revenue China Internet Saiyi HE, CFA(852) 3916 1739hesaiyi@cmbi.com.hk Wentao LU, CFAluwentao@cmbi.com.hk Expect total revenueto recover by 2%/1% YoY/QoQ in 4Q25E.For4Q25E: 1)after declining YoY forsevenconsecutive quarters since 1Q24,weestimatemembership revenue tobelargelyflattish YoY at RMB4.1bn,primarily driven by the solidperformanceof several popular TV series titles;2) we forecast online advertising revenue todeclineby 6% YoY but grow by8% QoQ to RMB1.34bn. The QoQ increase was mainly due to the adbudgetgrowthduringe-commerce shopping festivals,and popular variety shows; Ye TAO, CFA(852) 3850 5226franktao@cmbi.com.hk Joanna Ma(852) 3761 8838joannama@cmbi.com.hk Positive progress in overseas market, micro drama and IP derivatives. iQIyicontinued to make progress on its new initiatives.1)Overseasbusiness: total video views of iQiyi overseas app grew by 114.5% YoY in2025, mainly driven by the strongperformanceof domestically-produced TVseries and movies.2)Micro drama: total number of micro drama titlesexceeded20,000, with over halfavailable for free.The company will further Expect margin improvement in 4Q25E/FY26E.Weexpect non-GAAPOPMtoimprove by 2ppt QoQ to 1.8% in 4Q25E, primarily attributable torevenue recovery and enhancedefficiency. WeforecastGPM to improve by2ppt QoQ to 20.2% in 4Q25E, supported by prudent cost control andoperating leverage. With topline recovery, we expect non-GAAP OPM tobottom out and improve to 6%/7% in FY26/27E, versus 2% in FY25E. Source: FactSet Business forecasts update and valuation Valuation We valueiQiyiat US$2.75perADSbased on18x2026E non-GAAP EPS.Our target PEmultiple isat adiscountto thesector average (24x), due to the intense competition in Disclosures& Disclaimers Analyst Certification The research analyst who is primary responsible for the content of this research report, in whole or in part, certifiesthat with respect to the securities or issuerthat the analyst covered in this report: (1) all of the views expressed accurately reflect his or her personal views about the subject securities or issuer; and (2)no part of his or her compensation was, is,or will be, directly or indirectly, related to the specific views expressed by that analyst in this report.Besides, the analyst confirms that neither the analyst nor his/her associates (as defined in the code of conduct issued by The Hong Kong Securitiesand Futures Commission) (1) have dealt in or traded in the stock(s) covered in this research report within 30 calendar days prior to thedate of issue of this report; (2) willdeal in or trade in the stock(s) covered in this research report 3 business daysafter the date of issue of this report; (3) serve as an officer of any of the HongKong listed companies covered in this report; and (4) have any financial interests in the Hong Kong listed companies coveredin this report. CMBIGM Ratings BUY: Stock with potential return of over 15% over next 12 monthsHOLD: Stock with potential return of +15% to-10% over next 12 monthsSELL: Stock with potential loss of over 10% over next 12 monthsNOT RATED: Stock is not rated byCMBIGM :Industry expected to outperform the relevant broad market benchmark over next 12 months:Industry expected to perform in-line with the relevant broad market benchmark over next 12 months:Industry expected to underperform the relevant broad market benchmark over next 12 months Important Disclosures There are risks involved in transacting in any securities. The information contained in this report may not be suitable forthe purposes of all investors.CMBIGMdoes not provide individually tailored investment advice. This report has been prepared without regard to the individual investment objectives, financial positionor special requirements. Past performance has no indication of future performance, and actual events may differ materially from that which is contained in thereport.The value of, and returns from, any investments are uncertain and are not guaranteed and may fluctuate as a result of their dependence on theperformance of underlying assets or other variable market factors.CMBIGMrecommends that investors should independently evaluatepart