(Yicai) March 21 -- Kuaishou Technology’s chief executive said the Chinese short video app operator is positive that its large language model will perform as well as ChatGPT-4 within half a year, after the main rival of ByteDance’s Douyin reported its first annual profit since going public three years ago.

“We’re confident that we can elevate our large language model within the next six months to match GPT-4’s performance,” Cheng Yixiao, who is also Kuaishou’s co-founder, said on the Beijing-based company’s earnings conference call yesterday.

Its 175 billion parameter model, which is in testing, “significantly surpasses GPT-3.5 in overall performance, especially in understanding detail and readability,” he said, adding that “it's approaching GPT-4 levels in certain metrics.

“Early in 2023, we kicked off our AI strategy with a clear target and roadmap,” Cheng said. “Our progress is on track with our original plan.”

Kuaishou unveiled its self-developed LLM KwaiYii and SpikeGPT, the company’s first generative spiking neural networks language model, last August amid the global market frenzy over artificial intelligence chatbots.

“As an AI-driven company, we are committed to continuing our investment in AI large language models and their applications,” Cheng said.

Annual Earnings

In the 12 months ended Dec. 31, Kuaishou’s had an adjusted net profit of CNY10.3 billion (USD1.4 billion), compared with a loss of CNY5.8 billion (USD805.7 million) in 2022, the company’s annul earnings report showed yesterday. Revenue jumped 21 percent to CNY113.5 billion (USD15.8 billion).

“In 2023, we continuously elevated our content and commercial ecosystem, ushering in a new era of sustainable profitability for Kuaishou,” Cheng said in a statement. “In 2024, we will further refine our trust-based content and commercial ecosystem to maximize the value we create for our users and stakeholders alike.”

At CNY60.3 billion, more than half of its operating income came from online marketing services, a 23 percent increase. Revenue from Kuaishou’s livestreaming business rose 10 percent to CNY39.1 billion, accounting for 34 percent of total revenue.

Revenue from other services jumped 45 percent to CNY14.1 billion as users bought more products seen in videos. Gross merchandise volume increased 31 percent to CNY1.18 trillion (USD163.9 billion) annually and rose 29 percent in the fourth quarter.

Kuaishou's efforts abroad are bearing fruit as overseas revenue almost quadrupled to CNY2.3 billion due to mini-series, games, and sports. But its overseas businesses still made a loss of CNY2.8 billion, 60 percent less than in 2022. The firm has been actively seeking growth in key markets such as Brazil and Indonesia.

Kuaishou’s mini-series have 270 million viewers every day, the firm said. During the fourth quarter, the platform logged 94 million users watching over 10 episodes of mini-series per day, up by more than 50 percent. The number of paid subscribers surged by over four times.

Shares of Kuaishou [HKG: 1024] finished 1.9 percent lower at HKD51.25 (USD6.55) each in Hong Kong today. The stock is down 3.2 percent so far this year.

Editor: Emmi Laine