Abstract: Joint operation of cascade hydropower stations improves system-wide power-generation benefits, while scientifically allocating cooperative gains is essential to alliance stability. In this study, we combine implicit stochastic optimization with a long short-term memory model to select operating rules, which are used to simulate long-term operation and to construct payoff functions. Cooperative gains are allocated using proportional, nucleolus, and Shapley-value methods, and the preferred strategy is identified through multidimensional evaluation. A case study of the Mardang–Banduo–Yangqu cascade hydropower system shows that joint operation yields an average annual benefit of CNY 3.728 billion, an increase of CNY 173 million, or 4.87%, over independent operation. Under the Shapley-value allocation, Mardang, Banduo, and Yangqu receive 48.55%, 11.56%, and 39.88% of the cooperative gain, respectively, resulting in the most stable alliance. These findings provide a theoretical basis for designing joint-operation mechanisms for multi-operator cascaded hydropower systems.