On August 4, Meitu released its first-half 2026 performance forecast, revealing a record high in paid subscribers and rapid growth in both productivity application ARR and AI computing power point consumption. Major investment banks, including Goldman Sachs, UBS, and Bank of America, have issued reports stating that Meitu's current valuation is low, and they maintain "Buy" ratings.
According to the announcement, Meitu expects its adjusted net profit attributable to shareholders for the first half of 2026 to achieve a year-on-year growth of 36% to 40%. A report from UBS indicated that this net profit surpasses market expectations and consensus forecasts by 4% to 12%. With Meitu's current valuation at 9-10 times the projected 2027 price-to-earnings ratio, UBS maintains a "Buy" rating with a target price of HK$7.2.
The announcement disclosed that as of June 2026, Meitu's paid subscribers exceeded 18.44 million. Revenue from imaging and design products increased by 30.9% year-on-year to approximately RMB 1.8 billion. Bank of America's report estimates that the average revenue per user (ARPU) for Meitu's imaging and design products in the first half of 2026 grew by 6% year-on-year. The strong growth in AI computing power point consumption indicates that user engagement with AI-driven visual creation workflows is deepening, which is expected to further boost ARPU for productivity applications. Bank of America believes that Meitu's growth in paid subscribers and operational leverage are driving a continuous improvement in fundamentals. With its current valuation at a low level, a PEG ratio of just 0.3 times compared to an average of about 1 time for leading US peers, Bank of America maintains a "Buy" rating with a target price of HK$7.4.
As of June 2026, Meitu's AI productivity application ARR grew by 47.8% year-on-year to over RMB 620 million. Goldman Sachs' report attributes this primarily to the strong growth of "Kaipai" and "Vmake." Meanwhile, the newly launched AI music video generation product, "MVLAND," doubled its ARR within three months, reflecting strong user demand for new products and the company's ability to rapidly develop and generate incremental revenue. Goldman Sachs remains optimistic about new features and products driving an increase in the paying user rate, and is positive about the contributions from new products like MVLAND and Picchi. It maintains a "Buy" rating with a target price of HK$12.3.
Comments