Investment Highlights

EZVIZ Network released 2024A&2025Q1 results:

2024 annual results: revenue of 5.442 billion yuan (+12.41% year-on-year, the same below), net profit attributable to the parent company of 504 million yuan (-10.52%), and non-net profit of 483 million yuan (-12.63%), mainly dragged down by the increase of 26.66% (697 million yuan →858 million yuan) in sales expenses.

2024Q4 single-quarter results: revenue of 1.479 billion yuan (+11.05%), net profit attributable to the parent company of 129 million yuan (-20.03%), and non-net profit of 115 million yuan (-29.73%).

2025Q1 single-quarter results: revenue of 1.380 billion yuan (+11.59%), maintaining a growth rate of 10%-15% for 8 consecutive quarters, net profit attributable to the parent company of 138 million yuan (+10.42%), and non-net profit of 138 million yuan (+13.24%).

Sub-business: The growth rate of smart home and cloud platform business is eye-catching, and intelligent service robots have achieved breakthroughs 1) Smart cameras: The annual revenue in 2024 will be 2.948 billion yuan (year-on-year - 1.38%, the same below), accounting for 54% of revenue, and the gross profit margin will be 37.19% (down 0.97pct year-on-year). In 2024, a number of new products will be launched, such as the S10 video call camera with screen, the H8x series of super night outdoor gimbals, and the TAMO pet sitting camera, etc., to continue to maintain the leading market position in this category of products.

2) Smart home: The annual revenue in 2024 will be 748 million yuan (+47.87% year-on-year), the revenue will account for 13.74% (10.45% in 23), and the gross profit margin will increase significantly to 42.53% (+8.99pct). In 2024, a number of new products such as the AI three-camera automatic face video lock DL60FVX Pro equipped with a large cloud model will be launched, and the product matrix will continue to be enriched, becoming the second growth curve of the smart home part, and the proportion of revenue will continue to rise, and the prosperity will continue.

EZVIZ smart locks, which focus on face recognition and visual capabilities, have begun to enter the forefront of the industry, and the Y3000 series has become a hot seller. The company has also launched innovative products such as cost-effective face + palm vein, industry-leading three-camera smart lock, etc., to meet the all-round needs of users for safety, convenience and intelligence in home scenarios.

3) Intelligent service robots: In 2024, the revenue of the separate column will be 166 million yuan (+265.12% year-on-year), and the future development prospects are broad and the potential is great. At present, in the smart home scenario for consumer users, the company has deployed household cleaning robots and companion robots to meet diversified needs such as cleaning, companionship, and nursing; At the same time, based on the scalability of the underlying technology of the robot, the company also continues to polish the commercial cleaning robot products to meet the growing cleaning needs of commercial scenarios, and is committed to improving the service quality of commercial cleaning and realizing the cost reduction and efficiency increase of building property management.

4) Cloud platform services: In 2024, the annual revenue will be 1.052 billion yuan (+22.87% year-on-year), accounting for 19.33% of the revenue. Based on the EZVIZ blue ocean model and integrated with the developer's industry scenarios, the company quickly iterates the AI capabilities of the cloud platform, from response to interaction, from video to vision, from seeing to reading, from scenario-based management services to helping customers innovate their business models. In 2024, the number of monthly active users of the cloud platform will reach 65.5281 million (+20.31% year-on-year), and the customer service revenue of B-end developers will increase by 26.30% year-on-year.

5) Accessories: Annual revenue in 2024 will be 384 million yuan (+43.73% year-on-year).

Overseas business grew rapidly, and the product matrix was further improved

In 2024, overseas revenue will be 1.912 billion yuan (+26.42% year-on-year), accounting for 35.42% of the company's main business income. The company continues to carry out business in many overseas countries and regions, adopts a localization strategy tailored to local conditions, relies on localized marketing teams, improves the channel ecosystem, and promotes the expansion of overseas business from single product category to multi-category. Smart home is actively becoming the second growth curve of overseas business, with an increase in the proportion, among which villa doorbells, smart peepholes, and smart lock products are highly competitive, driving the growth of the overall overseas home business. As an overseas incubation business, cleaning robots are growing rapidly, and will achieve an initial breakthrough in sales in 2024.

Technology Ecology and AI Layout.

Ecosystem upgrade: Upgraded from "1+4+N" to "2+5+N", driven by AI + EZVIZ IoT cloud dual-core, five self-developed product lines (smart home cameras, smart homes, smart service robots, smart control, and smart wearables) have been built, and open access to N ecological products. Breakthrough in AI technology: Released the "EZVIZ Blue Ocean Model" to achieve device-cloud collaboration and support multi-agent capabilities such as child care and elderly care.

Earnings Forecast and Valuation

It is estimated that the company's revenue in 25-27 years will be 6.39 billion (+17.42%), 7.44 billion (+16.44%), 8.519 billion (+14.5%), and net profit attributable to the parent company will be 661 million (+31.13%), 774 million (+17.08%), 943 million (+21.84%), and the corresponding PE will be 42.74X, 36.50X, and 29.96X. As a scarce target of the dual main business of smart home + cloud platform, the company's main business of smart cameras is firmly in the leading position in the industry, and the growth of smart home, cloud platform, and smart home products is eye-catching, supporting the second and third growth curves, and the profitability is steadily improving under the continuous optimization of products & channels & supply chains, maintaining a "buy" rating.

Risk warning: the development of smart home business is less than expected, and the price competition in the industry is intensifying