Kuaishou Technology Announces First Quarter 2024 Unaudited Financial Results
PR Newswire
HONG KONG, May 22, 2024
HONG KONG, May 22, 2024 /PRNewswire/ -- Kuaishou Technology ("Kuaishou" or the "Company"; HKD Counter Stock Code: 01024 / RMB Counter Stock Code: 81024), a leading content community and social platform, today announced its unaudited consolidated first quarterly results for the three months ended March 31, 2024.
First Quarter 2024 Key Highlights
-- Average DAUs on Kuaishou APP were 393.8 million, representing an increase
of 5.2% from 374.3 million for the same period of 2023.
-- Average MAUs on Kuaishou APP were 697.4 million, representing an increase
of 6.6% from 654.4 million for the same period of 2023.
-- Total e-commerce GMV(1) was RMB288.1 billion, representing an increase of
28.2% from RMB224.8 billion for the same period of 2023.
-- Total revenue increased by 16.6% to RMB29.4 billion from RMB25.2 billion
for the same period of 2023. Online marketing services and live streaming
contributed 56.6% and 29.2%, respectively, to the total revenue. The
other 14.2% came from other services.
-- Gross profit increased by 37.6% to RMB16.1 billion from RMB11.7 billion
for the same period of 2023. Gross profit margin in the first quarter of
2024 was 54.8%, improving from 46.4% for the same period of 2023.
-- Profit for the period was RMB4.1 billion, compared to a loss of RMB876
million for the same period of 2023. Adjusted net profit(2) increased to
RMB4.4 billion from RMB42 million for the same period of 2023.
-- Operating profit from the domestic segment(3) increased to RMB4.0 billion
from RMB963 million for the same period of 2023. Operating loss from the
overseas segment(3) decreased to RMB268 million by 67.4% year-over-year.
Mr. Cheng Yixiao, Co-founder, Chairman, and Chief Executive Officer of Kuaishou, said, "Our robust operational and financial performance in the first quarter showcase the powerful economic moat we have created across our user and commercial ecosystems. Strong execution of our high-quality user growth strategy drove steady traffic growth. At the same time, we continued to cultivate a healthy content ecosystem, further integrating AI technology throughout our platform to strengthen experiences in content consumption, shopping and services for our users. This steadily elevated growth in our e-commerce business and improved commercialization efficiency. Our total revenue increased by 16.6% year-over-year in the first quarter, reaching RMB29.4 billion. Our operating strategy centered on improving quality and efficiency also led to increased profitability with our adjusted net profit reaching RMB4.4 billion. Looking ahead, we will continue strengthening our business by leveraging the power of short videos plus live streaming to unlock new growth opportunities. As we continue to harness technology-driven innovation, we believe we can deliver even greater value to our users, partners and shareholders."
First Quarter 2024 Financial Review
Revenue from our online marketing services increased by 27.4% to RMB16.7 billion for the first quarter of 2024, from RMB13.1 billion for the same period of 2023, primarily attributable to the growth in the number of marketing clients and increased consumption from marketing clients driven by our efforts to promote the application of our smart marketing solution and upgraded omni-platform marketing capabilities.
Revenue from our live streaming business decreased by 8.0% to RMB8.6 billion for the first quarter of 2024 from RMB9.3 billion for the same period of 2023, due to our continuing endeavor in further building long-term sustainable live streaming ecosystem.
Revenue from our other services increased by 47.6% to RMB4.2 billion for the first quarter of 2024, from RMB2.8 billion for the same period of 2023, primarily due to the growth of our e-commerce business, represented by the growth in our e-commerce GMV. The growth in e-commerce GMV was driven by increases in the number of active e-commerce paying users and active merchants as a result of our continuously refined operating strategies and expanded e-commerce scenarios.
Other Key Financial Information for the First Quarter of 2024
Operating profit was RMB4.0 billion, compared to an operating loss of RMB698 million for the same period of 2023.
Adjusted EBITDA(4) was RMB6.0 billion, increasing from RMB2.0 billion for the same period of 2023.
Total available funds(5) reached RMB63.7 billion as of March 31, 2024.
Notes:
(1) Placed on or directed to our partners through our platform.
(2) We define "adjusted net profit" as profit/(loss) for the period adjusted by share-based compensation expenses and net fair value changes on investments.
(3) Unallocated items, which consist of share-based compensation expenses, other income, and other gains, net, are not included.
(4) We define "adjusted EBITDA" as adjusted net profit for the period adjusted by income tax (benefits)/expenses, depreciation of property and equipment, depreciation of right-of-use assets, amortization of intangible assets, and finance income, net.
(5) Total available funds which we considered in cash management included but not limited to cash and cash equivalents, time deposits, financial assets and restricted cash. Financial assets mainly included wealth management products and others.
Business Review
We commenced the year with robust operational and financial performance during the first quarter of 2024. In the first quarter of 2024, our total revenue expanded by 16.6% year-over-year to RMB29.4 billion, with a gross profit margin of 54.8%, profit of RMB4.1 billion and profit margin of 14.0%. These results demonstrate the strong resilience of our business and economic moat created by our user and commercial ecosystems despite that the first quarter is a typical slow season for the industry.
In the first quarter of 2024, we further rolled out our new traffic recommendation mechanism to all users, aligning improvements in user experience with increased monetization efficiency. Our smart marketing solution empowered marketing clients to improve their performances, attracting increased client budgets. Through our commitment to creating excellent user shopping experience, we have steadily grown our e-commerce business with a dual-drive approach of live-streaming e-commerce and shelf-based e-commerce. We have also continued our efforts to foster a healthier live-streaming ecosystem, laying a solid foundation for the platform's sustainable growth. Moreover, we made steady advances in the research, development and training of our self-developed large language models to empower multiple business scenarios with AI technology, facilitating growth through efficiency gains.
User and content ecosystem
In the first quarter of 2024, average DAUs and MAUs on the Kuaishou App reached 394 million and 697 million, representing year-over-year increases of 5.2% and 6.6%, respectively. The average daily time spent per DAU on the Kuaishou App was 129.5 minutes. Our user traffic grew steadily in terms of the total user time spent increasing by 8.6% year-over-year in the first quarter of 2024. The increases in our user metrics are the strong testaments of our success in high-quality user growth strategy. By meeting user demand with superior content and continuously elevating user experience, we provide more value to the users on our platform.
In terms of user growth, we optimized our user acquisition channel mix, simultaneously combining algorithms to forecast new user retention rates, thereby increasing the ROI of our user growth. Additionally, we implemented several initiatives, such as delving into the diversity of user interest and enhancing ranking strategies of the short videos' comments. These efforts not only improved user experience but also increased user time spent on the platform.
In terms of content supply, we nurtured quality creators embodying distinctive Kuaishou characteristics, and created differentiated, high-quality, bespoke Kuaishou IP content for important occasions, incentivizing users to open the Kuaishou App. For example, in celebrating the Year of the Dragon with our nearly 400 million users, we continued "A Taste of Chinese New Year on Kuaishou" activities in 2024 featuring a diverse array of Chinese New Year-themed content. This included Kuaishou 1001 Nights Fans' Gala ( ), online festival fairs ( ) and the Village Basketball Association ( BA). In addition to serving as a stage for creators to showcase their talent, these events also increased users' stickiness on Kuaishou. Meanwhile, during the Spring Festival in 2024, 20 short plays produced by Kuaishou Astral Short Plays ( ) received more than 100 million views each, and seven of which gained over 300 million views each.
For our search business, we optimized the search function by leveraging large language model technology and refined the landing page for "search after watching" feature. These initiatives improved user penetration and overall search experience. In the first quarter of 2024, Kuaishou search's average monthly users increased by more than 15% year-over-year, and the number of daily searches peaked at nearly 800 million. In terms of search commercialization, revenue from search marketing services grew by over 50% year-over-year in the first quarter of 2024.
Online marketing services
In the first quarter of 2024, our revenue from online marketing services rose by 27.4% year-over-year to RMB16.7 billion, accounting for 56.6% of our total revenue. Through our robust efforts to promote the application of our smart marketing solution across various scenarios, the number of active marketing clients increased by almost 90% year-over-year in the first quarter of 2024.
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