1、ab1 September 2025Global ResearchFirst ReadMeituOur reads on Googles Nano Banana Whats new:Google launches Nano BananaNano Banana,an image editing and generation model by Google,was launched on 25 August,and is integrated in the Gemini app and Google AI Studios.Meitus share price declined 14%today,i

2、n our view likely due to investor concerns over AI disruption risks after seeing positive feedback on the model.Our reads:chance to buy the dip;expanding TAM+model container strategyDuring a recent interim briefing in August,Meitu emphasised its strategy shift to focusing on vertical model training

3、and use cases,embracing a model container concept,instead of training its own foundation model.This approach allows Meitu to focus on developing AI-native workflows by leveraging a combination of open-sourced models,third-party APIs,and its own fine-tuned vertical models.We believe Meitus strategy i

4、s to ensure that rapid iterations in foundation models directly translate into superior product features for its nearly 300mn MAUs,by prioritising its strengths in product design,user experience,and its understanding of workflows of different verticals.Meanwhile,evolving model capabilities should bo

5、ost the overall TAM of graphic design.For example,our recent channel check with a Meitu DesignKit e-commerce merchant user indicates improvement in AI capabilities should boost overall usage of AI tools as the results catch up with real-world shoots.We remain positive on Meitu and we will continue t

6、o monitor its app grossing and MAU closely in our monthly tracker.Highlights(Rmbm)12/2212/2312/2412/25E12/26E12/27E12/28E12/29ERevenues2,0852,6963,3413,9875,1696,5187,9149,400EBIT(UBS)563605248141,1871,6042,0812,561Net earnings(UBS)1113685869471,2711,6912,1912,701EPS(UBS,diluted)(Rmb)0.020.080.130.2