On September 11, Z.AI fell 3.36% in regular trading, trading at 788.5 HKD/share with turnover of 18.71 billion HKD, extending a persistent downtrend since early September. The stock has now declined over 70% from its June high of 2,980 HKD.

The decline comes as Jefferies significantly cut its cloud business valuation multiple from 50x to 30x, lowering its target price from 1,299.8 HKD to 1,183.79 HKD while maintaining a Hold rating. The firm questioned the sustainability of Z.AI's year-end 24 billion USD ARR guidance, citing high customer concentration, uneven computing power supply, and potential gross margin erosion in the second half as new GPU clusters come online. Jefferies explicitly stated the Chinese large model space is overcrowded, favoring full-stack cloud platforms over independent AI labs.

Adding to the pressure, Morgan Stanley noted that DeepSeek's latest Flash series price cuts were likely driven by competitive threats from models including GLM-5.3-Flash, signaling an accelerating price war in the inference layer. Z.AI reported 9.54 billion RMB in first-half revenue, up 399.7% year-over-year, but overall gross margin declined to 26.4% from 50.0% a year earlier as its revenue mix shifted heavily toward lower-margin API services.

(The above content is based on publicly available market information, generated by a program or algorithm, and is intended solely as a stock movement alert. It does not constitute investment advice or a basis for trading decisions.)