Morgan Stanley issued a research update on MiniMax on March 2, 2026, following the Chinese AI startup's fourth-quarter and full-year 2025 earnings release. The bank maintained its Overweight rating with a price target of HK$930, implying US$2.50, and the numbers behind that conviction are hard to dismiss.

A Revenue Beat That Raises the Bar

MiniMax reported full-year 2025 revenue of US$79 million, up 159%. The fourth quarter alone delivered US$25.6 million in revenue, coming in 19% above the bank's forecast — a margin of outperformance that signals the company's commercial momentum is accelerating faster than even its most optimistic institutional backers had modeled.

The growth was driven by two engines: the Open Platform and enterprise AI services segment surged 278% year-over-year in Q4, while AI-native products — which include consumer-facing applications — rose 82% over the same period. Crucially, overseas markets accounted for 73% of total 2026 revenue, underscoring MiniMax's unusually aggressive international footprint for a Chinese AI company at this stage of development.

Margin Discipline Stands Out in a Loss-Heavy Sector

In a sector where "growth at all costs" remains the dominant operating philosophy, MiniMax's cost trajectory deserves attention. Full-year gross profit margin expanded 13 percentage points to 25.4%, while Q4 gross margin reached 30% — well above Morgan Stanley's 17% estimate. The bank flagged this as evidence of meaningful operating leverage beginning to take hold.

More telling is the loss discipline. Non-IFRS net loss in Q4 widened just 13% year-over-year, a fraction of the 131% top-line growth recorded in the same period. Sales and marketing expenses actually fell 63% year-over-year in Q4, suggesting the company is shifting from paid acquisition toward organic and platform-driven growth. R&D spend rose 44% — elevated, but controlled relative to revenue expansion.

Contract liabilities, a forward-looking indicator of subscription demand, nearly quintupled by year-end to US$7.5 million, pointing to a growing base of committed enterprise customers.

Token Consumption Data Signals Explosive Early-2026 Traction

Perhaps the most striking data point in the report is post-period usage metrics. Morgan Stanley noted that average daily token consumption for MiniMax's M2 series text models grew more than sixfold in February 2026 compared to December 2025. Coding Plan token consumption grew over tenfold in the same window. These figures suggest the product is achieving rapid adoption well beyond what the financial results alone would indicate.

The company also launched its MiniMax Agent AI-native Workspace in January 2026, a move that positions it directly in the enterprise productivity segment — a market where competition is intensifying but where switching costs and integration depth can create durable revenue streams.

Valuation and Risks

Morgan Stanley values MiniMax using a discounted cash flow model, assuming a 15% weighted average cost of capital and 3% terminal growth. The HK$930 price target implies a 54x price-to-sales multiple on 2027 estimates—a premium that reflects the bank's expectation of dramatic revenue scaling, with consensus projecting revenues of US$195 million in 2026 and US$700 million in 2027.

The bull case rests on MiniMax achieving state-of-the-art global model performance and sustaining its overseas revenue dominance. The bear case is well-documented: geopolitical risk remains a structural overhang for any Chinese technology company with significant international exposure, and the domestic AI landscape is characterized by intensifying competition and price compression. A slip in model performance relative to peers — domestic or foreign — could rapidly erode the platform's user base.

Bottom Line

MiniMax's 2025 results represent one of the cleaner revenue beats in the current cohort of listed Chinese AI pure-plays. The combination of accelerating top-line growth, improving gross margins, contained operating losses, and surging post-period usage metrics gives Morgan Stanley's Overweight thesis a tangible foundation. Whether the stock can sustain a valuation that prices in near-perfect execution through 2027 is a separate question — but for now, the operational narrative is running ahead of even the optimists' script.