4Q25 results: resilient recruitment demand;increasing shareholder return
4Q25 results: resilient recruitment demand;increasing shareholder return Target PriceUS$24.00(Previous TPUS$25.50)Up/Downside75.3%Current PriceUS$13.69 Boss Zhipin announced 4Q25 results: total revenue grew by 14% YoY toRMB2.08bn, and non-GAAP net income was up by 25% YoY to RMB906mn,both largely in line withBloomberg consensus estimates. For 1Q26E, thecompany guidedtotal revenue to grow by 6-8%YoY to RMB2.050-2.085bn,slightly below consensus estimate(RMB2.12bn),as the late start oftheSpringFestival this year led to fewer days for revenue recognition of the spring peakseason in 1Q26.Managementnoted therecruitmentdemand remained solid in1Q26 after adjustment of the Spring Festival effect.Given that the company willincrease investment in AIand S&M in FY26,we slightly trim our FY26-27adjusted operating profit by 2-3%. That said, we still expect solidtotalrevenuegrowth of 12% YoY and adjusted OPM to improve by c.1ppt YoY on operatingleverage in FY26E. We slightly lower our target price to US$24.0 based on 20xFY26E non-GAAP PE (previous: US$25.5 on 21x FY26E PE).Maintain BUYonresilient earningsgrowth and decent shareholder return. China Internet SaiyiHE, CFA(852) 3916 1739hesaiyi@cmbi.com.hk Wentao LU, CFAluwentao@cmbi.com.hk Ye TAO, CFA(852) 3850 5226franktao@cmbi.com.hk Resilient recruitmentdemand.Total paid enterprise customersgrewby11% YoY to 6.8mn in 12 months endedDec 2025. Average MAUs increasedby 10% YoY to 58mn in 4Q25.Manufacturing, electronics, communicationsand semiconductorsectors ledin terms of recruitment demand.For1Q26,theaverage daily job postings in the 15 days after theSpringFestival grewby a double-digit% YoY, and theratio of job seekers to enterpriseusersremained within a reasonable rangeaccording to the company, which reflecthealthysupply and demand dynamics. Supported by the solid demand, weexpect total revenue growth to accelerate throughout FY26E. Shuyin GUO(852) 3916 3716guoshuyin@cmbi.com.hk Stock Data Positiveprogress on the AI front.1)AI improves the company’scapabilities to deliver closed-looprecruitmentservices, the revenue fromwhich has reachedhundreds of millionsofRMB.AI enables large-scaleclosed-loop services throughimproving the accuracyandefficiencyof jobmatching, effectivelyreducing the costs oflarge-scale recruitment.2) TheAI quick hiring tool for high-end usershas beenscaled up for broader trials.Itcanbetterunderstand therecruitmentrequirement,automatically conductsearches within a database of 250mnjob seekers,andinteractwith usersto improve hit rate.This allows the company to capture greater wallet shareofhigh-end enterprise users.3)TheAI-assisted interview feature has beenfully rolled out tojob seekers, which has significantly increased userengagement. Stepping upshareholderreturn.AdjustedOPM improved by 9ppt YoY to41% in FY25 thanks to the operating leverage and prudent opex control. Weexpect adjusted OPM to further improve by 1ppt YoY in FY26E,despitetheincrease in AI and marketing investment. Looking ahead, the companyplans to increase shareholder returnthroughallocatingno less than 50% ofprior-year adjusted net income for distribution of dividends and sharerepurchaseseach year during FY26-28.This shall translate into ashareholder returnof over 4% in FY26E,based on our estimates. Source: FactSet Business forecasts update and valuation Valuation We valueBoss Zhipinat US$11.5bn (US$24.0perADS) based on20x 2026E PE. Ourtarget PE multipleisat a premium to itspeersaverage (13x), given Boss Zhipin’s strongleadership in China’s online recruitment market and earnings visibility. Disclosures& Disclaimers Analyst CertificationThe research analyst who isprimary responsible for the content of this research report, in whole or in part, certifies that with respect to the securities or issuer that 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 Securities and 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 days after 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 covered in this report. CMBIGM RatingsBUY : 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 lossof over 10% over next 12 monthsNOT RATED: Stock is not rated byCMBIGM :
