Meitu Exits Crypto to Go All-In on AI and Global Expansion

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In 2024, as Bitcoin surged toward the $100,000 mark—peaking at $93,574.2 by December 30—one surprising player made a strategic retreat from the crypto market: Meitu, the Hong Kong-listed tech company known for its photo-editing apps. Instead of riding the bull run, Meitu announced it had sold off its entire cryptocurrency portfolio, locking in profits and redirecting capital toward its core mission—AI-powered imaging and design tools.

This move signals a clear pivot: away from high-risk digital assets and toward a focused, sustainable future built on artificial intelligence and global growth.

Strategic Exit from Crypto at Market Peak

On December 4, 2024, Meitu officially declared the completion of its full divestment from Bitcoin and Ethereum. The company received approximately $180 million** in cash proceeds, realizing a gain of around **$79.63 million (about CNY 571 million).

The crypto assets were originally acquired in 2021 during a wave of corporate interest in digital currencies. Meitu invested a total of $100 million, purchasing roughly 31,000 ETH and 940.89 BTC across three separate transactions.

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However, the volatility of crypto markets soon took its toll. In July 2022, Meitu issued a profit warning, forecasting a net loss between CNY 274.9 million and CNY 349.9 million—largely due to impairment losses on its crypto holdings. With regulatory scrutiny intensifying worldwide and market swings becoming increasingly unpredictable, holding such assets posed growing financial and compliance risks.

"From a financial stability standpoint, selling crypto assets in this environment is a rational move," said Chen Xiaohua, Director of the Blockchain and Data Elements Committee at the China Mobile Communications Federation. "It reduces exposure to market volatility and strengthens liquidity—especially as global regulators tighten oversight."

By exiting at a peak, Meitu not only avoided future uncertainty but also secured a war chest to reinvest in its most promising growth engine: AI-driven creative software.

AI Fuels Record Growth in Imaging and Design

With crypto behind it, Meitu is doubling down on what it does best—empowering users with intelligent visual tools. The results speak for themselves.

In the first half of 2024, Meitu reported total revenue of CNY 1.62 billion, a 28.6% year-on-year increase. Adjusted net profit attributable to equity holders reached CNY 270 million, up 80.3%. Most notably, revenue from its subscription-based imaging and design products hit CNY 930 million, accounting for 57.4% of total income.

The number of paying subscribers exceeded 10.81 million, marking an all-time high with a paid penetration rate of 4.2%—a figure that continues to climb.

What’s driving this surge? The rise of generative AI.

"Generative AI has unlocked a massive innovation dividend for our industry," a Meitu spokesperson told Securities Daily. "Our AI-enhanced features—from advanced image retouching to video editing and graphic design—deliver superior user experiences, which directly boost conversion rates and subscription growth."

Unlike many companies still experimenting with AI monetization, Meitu has already achieved commercial success. Its AI tools are seamlessly integrated into flagship apps like MeituPic, offering real-time enhancements such as skin smoothing, background replacement, and artistic filters—all powered by proprietary deep learning models.

This early-mover advantage in AI commercialization sets Meitu apart in a crowded tech landscape.

Global Ambitions: Scaling AI Products Worldwide

While domestic success is strong, Meitu’s next frontier is international expansion.

The company has adopted a dual strategy centered on productivity tools and globalization. It plans to launch localized versions of its imaging and design apps across key markets—including the U.S., UK, and Australia—and is actively building overseas teams to support these efforts.

Morgan Stanley recently upgraded Meitu to an "Overweight" rating, citing two critical strengths: its recurring subscription model and rising paid user penetration. The firm also highlighted Meitu’s overseas potential, noting that Western consumers tend to have higher willingness-to-pay for digital creativity tools.

"International markets offer vast room for growth," said an analyst at Morgan Stanley. "Meitu’s vertical expertise in visual AI, combined with agile product development, positions it well to capture share abroad."

Already, Meitu has established offices in North America and Oceania, hiring local talent in engineering, marketing, and customer support. These moves suggest long-term commitment—not just to selling software overseas, but to understanding and serving global user needs.

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Frequently Asked Questions (FAQ)

Q: Why did Meitu sell all its cryptocurrency holdings?
A: Meitu sold its crypto assets to reduce financial risk associated with market volatility and regulatory uncertainty. The proceeds—around $180 million—are being used to strengthen its balance sheet and fund growth in AI-based imaging products.

Q: Did Meitu make a profit from its crypto investments?
A: Yes. Despite earlier impairments during the 2022 market downturn, Meitu realized a net gain of approximately $79.63 million from the sale of its Bitcoin and Ethereum holdings after prices rebounded in 2024.

Q: What is Meitu’s main business now?
A: Meitu’s primary focus is on AI-powered imaging and design software delivered through a subscription model. Its apps offer photo/video editing, graphic creation, and productivity tools enhanced by generative AI.

Q: Is Meitu expanding outside China?
A: Yes. The company is actively pursuing global expansion, launching products in English-speaking markets like the U.S., UK, and Australia, while setting up overseas offices and hiring international teams.

Q: How many paying users does Meitu have?
A: As of mid-2024, Meitu had over 10.81 million paying subscribers, with a paid penetration rate of 4.2%, both record highs for the company.

Q: Can other tech companies replicate Meitu’s AI success?
A: While competition exists, Meitu benefits from years of domain-specific data and refined algorithms in visual processing—an edge that’s hard to replicate quickly. Its early integration of generative AI into consumer apps gives it a first-mover advantage in monetization.

Future Outlook: Betting Big on AI Innovation

With crypto fully exited and gains secured, Meitu plans to allocate about 80% of the profit from the sale as a special dividend, returning value to shareholders. The remainder will be used as general working capital, primarily funding R&D and global marketing for its AI product suite.

This capital injection could accelerate innovation in areas like:

As generative AI reshapes digital content creation, Meitu aims to be at the forefront—not as a speculative investor, but as a builder of practical, profitable AI applications.

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The message is clear: Meitu isn’t chasing trends. It’s building the future—one pixel, one algorithm, one global user at a time.

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