Z.AI CO., LTD. (2513.HK): ARR Guidance Raised

Z.ai reached US$1.8bn ARR as of mid-September and raised year-end ARR guidance from US$2.4bn to US$3.0bn; we reiterate Overweight. Management's framework suggests the US$5bn (~Rmb30bn) funding round could support ~94k GPUs, with ~40% for training and ~60% for inference; the ~56k-GPU inference pool implies a theoretical annual revenue ceiling of ~Rmb41bn (US$6bn) with theoretical inference GPM of up to ~80%. The compute bottleneck was evident in June, when GLM-5.2 demand surged but Z.ai's own infrastructure could serve only ~10% of token demand. Z.ai has reached revenue-sharing arrangements with leading domestic and overseas cloud vendors, with revenue contribution expected from October. Cowork is expanding beyond coding, with over 100 cybersecurity companies having integrated GLM models and orders exceeding Rmb1bn within one month of GLM-5.3's launch. ARR guidance was raised on three drivers: coding, cloud partnerships and Cowork.