Kuaishou (快手) Can't Buy a Growth Story with 20 Billion Profit

Profits, but no re-rating

Kuaishou (快手) posted revenue of about RMB 142.8 billion and adjusted net profit north of RMB 20 billion last year, with a final dividend of HK$3 billion. Numbers that look healthy on paper. Yet the market has punished the stock: peak market value at listing in 2021 was HK$1.7 trillion; today it is only a little above HK$200 billion — an erosion of more than 80%. Why does a profitable, cash-generative platform trade like a slow-growth utility?

Slowing commerce growth and disappearing signal

Part of the answer is what Kuaishou and its peers are no longer willing to shout about. It has been reported that during a Q2 earnings call CEO Cheng Yixiao said Kuaishou will stop separately disclosing quarterly and annual e‑commerce GMV from Q1 2026. The underlying GMV trajectory helps explain the caution: year‑on‑year GMV growth fell from 78% in 2021 to 33% in 2022, 31% in 2023 and about 17% in 2024, with Q4 at 12.9% (Q4 GMV reported at RMB 521.8 billion). This is not just Kuaishou — Alibaba (阿里巴巴) and PDD (拼多多) have also seen domestic e‑commerce growth slow to single digits, and JD (京东) long ago stopped leaning on GMV as the headline metric. The implication? High‑growth China e‑commerce is structurally cooling.

Users, ARPU and the limits of efficiency

Daily activity tells a similar story. Kuaishou’s quarterly peak DAU was about 416 million in Q3, slipping to 408 million in Q4; full‑year DAU around 410 million shows growth close to stagnation. Q4 revenue of RMB 39.6 billion implies roughly RMB 1 per DAU per day. By contrast, Douyin (抖音) — the larger, privately held rival under ByteDance (字节跳动) — reportedly has about 600 million DAUs and an estimated per‑user monetization two to three times higher. QuestMobile data also show Kuaishou ranks last among six mainstream platforms on “high‑value” user share (~70 million, 15.5%), a structural gap not fixed in a year.

Why profit alone won’t reopen the story

Kuaishou has improved margins by cutting costs, streamlining operations and using AI to automate ad placement and content production — adjusted net margin rose into the mid‑teens and adjusted net profit exceeded RMB 20 billion. But investors appear to have priced those gains already: the stock trades at roughly 10–13x PE, consistent with a “no‑growth, cash machine” valuation. Efficiency improvements have a physical limit; once you’ve squeezed costs and optimized monetization, incremental upside is limited without a new growth engine. Against a backdrop of domestic regulatory reset, intense competition with ByteDance, and wider geopolitical uncertainty for Chinese tech, investors seem to have decided profitability isn’t enough — Kuaishou needs new, sustainable growth to win back multiple expansion.