Keep Inc. Shows Resilience in 2024 Interim Results
August 28, 2024, 10:41 am
Keep Inc., the titan of online fitness in China, has unveiled its interim results for the first half of 2024. The numbers tell a story of growth, resilience, and strategic evolution.
In a world where fitness is often a fleeting trend, Keep stands firm. The company reported total revenues of RMB 1,037.3 million, marking a 5.4% increase from RMB 984.7 million in the same period last year. This growth is not just a number; it reflects a robust strategy that is paying off.
Gross profit also saw a significant rise, reaching RMB 477.3 million, a 12.7% increase from RMB 423.7 million in 2023. The gross profit margin climbed to 46.0%, up from 43.0%. This upward trajectory indicates that Keep is not just growing; it is doing so efficiently.
The adjusted net loss narrowed to RMB 160.7 million, a substantial improvement from RMB 223.1 million in the previous year. This shift in financial health is a testament to the company’s ability to adapt and thrive in a competitive landscape. The adjusted net loss margin decreased to 15.5%, down from 22.7%.
Operationally, Keep is also gaining momentum. The average monthly active users (MAUs) reached 29,660, a slight increase from 29,549 in 2023. This growth in user engagement is crucial. It shows that more people are turning to Keep for their fitness needs. The average monthly revenue per MAU rose to RMB 5.8, up from RMB 5.6.
Membership is a key driver of Keep’s success. The number of subscribing members surged to 3,282, compared to 3,017 last year. The membership penetration rate climbed to 11.1%, up from 10.2%. This increase signals a growing trust in the Keep brand and its offerings.
CEO Wang Ning highlighted the company’s proactive strategies. The launch of App 8.0 and an expanded portfolio of services have enhanced user experience. Marketing campaigns have integrated online fitness services with smart devices, creating a cohesive ecosystem.
Revenue streams are diversifying. Self-branded fitness products generated RMB 501.5 million, a 7.5% increase from RMB 466.4 million. This growth is driven by stronger wholesale channel sales and increased demand for fitness gear.
However, not all segments are thriving. Revenue from online membership and paid content dipped to RMB 437.0 million, down 2.6% from RMB 448.9 million. This decline is primarily due to reduced income from virtual sports events. Yet, the rise in online membership revenue offers a silver lining.
Advertising revenue soared by 42.4%, reaching RMB 98.9 million. This surge reflects Keep’s successful integration of online and offline advertising services.
Cost management is another area where Keep excels. The cost of revenues slightly decreased to RMB 560.0 million, down 0.2% from RMB 561.0 million. This reduction is attributed to lower costs in online membership and paid content.
Fulfillment expenses dropped significantly by 25.8%, thanks to optimized warehousing and delivery processes. Conversely, selling and marketing expenses rose by 25.8%, reflecting increased promotional activities aimed at user acquisition.
Administrative expenses fell by 19.3%, showcasing effective cost control measures. Research and development expenses also decreased by 19.6%, indicating a shift in resource allocation.
Despite a net loss of RMB 163.4 million, down from a profit of RMB 1.2 billion last year, Keep remains optimistic. The previous year’s profit was largely due to fair value changes in convertible redeemable preferred shares.
Liquidity remains strong, with cash and cash equivalents at RMB 1.4 billion, down from RMB 1.6 billion at the end of 2023. This decrease is primarily due to cash used for operating and financing activities.
Keep is not resting on its laurels. The company plans to enhance its online offerings and explore outdoor fitness categories. AI-driven solutions will play a pivotal role in delivering innovative fitness experiences.
Looking ahead, Keep aims to promote growth in self-branded fitness products and seek collaborative opportunities across the industry. The goal is clear: to increase commercial value and ensure sustainable long-term development.
In a landscape where fitness apps come and go, Keep Inc. is a steadfast player. Its interim results reflect a company that is not just surviving but thriving. With a solid strategy and a commitment to innovation, Keep is poised for continued success in the ever-evolving fitness market.
As the company prepares for its earnings conference call, stakeholders will be eager to hear more about its future plans. Keep Inc. is not just a fitness platform; it’s a movement. And this movement is gaining momentum.
In a world where fitness is often a fleeting trend, Keep stands firm. The company reported total revenues of RMB 1,037.3 million, marking a 5.4% increase from RMB 984.7 million in the same period last year. This growth is not just a number; it reflects a robust strategy that is paying off.
Gross profit also saw a significant rise, reaching RMB 477.3 million, a 12.7% increase from RMB 423.7 million in 2023. The gross profit margin climbed to 46.0%, up from 43.0%. This upward trajectory indicates that Keep is not just growing; it is doing so efficiently.
The adjusted net loss narrowed to RMB 160.7 million, a substantial improvement from RMB 223.1 million in the previous year. This shift in financial health is a testament to the company’s ability to adapt and thrive in a competitive landscape. The adjusted net loss margin decreased to 15.5%, down from 22.7%.
Operationally, Keep is also gaining momentum. The average monthly active users (MAUs) reached 29,660, a slight increase from 29,549 in 2023. This growth in user engagement is crucial. It shows that more people are turning to Keep for their fitness needs. The average monthly revenue per MAU rose to RMB 5.8, up from RMB 5.6.
Membership is a key driver of Keep’s success. The number of subscribing members surged to 3,282, compared to 3,017 last year. The membership penetration rate climbed to 11.1%, up from 10.2%. This increase signals a growing trust in the Keep brand and its offerings.
CEO Wang Ning highlighted the company’s proactive strategies. The launch of App 8.0 and an expanded portfolio of services have enhanced user experience. Marketing campaigns have integrated online fitness services with smart devices, creating a cohesive ecosystem.
Revenue streams are diversifying. Self-branded fitness products generated RMB 501.5 million, a 7.5% increase from RMB 466.4 million. This growth is driven by stronger wholesale channel sales and increased demand for fitness gear.
However, not all segments are thriving. Revenue from online membership and paid content dipped to RMB 437.0 million, down 2.6% from RMB 448.9 million. This decline is primarily due to reduced income from virtual sports events. Yet, the rise in online membership revenue offers a silver lining.
Advertising revenue soared by 42.4%, reaching RMB 98.9 million. This surge reflects Keep’s successful integration of online and offline advertising services.
Cost management is another area where Keep excels. The cost of revenues slightly decreased to RMB 560.0 million, down 0.2% from RMB 561.0 million. This reduction is attributed to lower costs in online membership and paid content.
Fulfillment expenses dropped significantly by 25.8%, thanks to optimized warehousing and delivery processes. Conversely, selling and marketing expenses rose by 25.8%, reflecting increased promotional activities aimed at user acquisition.
Administrative expenses fell by 19.3%, showcasing effective cost control measures. Research and development expenses also decreased by 19.6%, indicating a shift in resource allocation.
Despite a net loss of RMB 163.4 million, down from a profit of RMB 1.2 billion last year, Keep remains optimistic. The previous year’s profit was largely due to fair value changes in convertible redeemable preferred shares.
Liquidity remains strong, with cash and cash equivalents at RMB 1.4 billion, down from RMB 1.6 billion at the end of 2023. This decrease is primarily due to cash used for operating and financing activities.
Keep is not resting on its laurels. The company plans to enhance its online offerings and explore outdoor fitness categories. AI-driven solutions will play a pivotal role in delivering innovative fitness experiences.
Looking ahead, Keep aims to promote growth in self-branded fitness products and seek collaborative opportunities across the industry. The goal is clear: to increase commercial value and ensure sustainable long-term development.
In a landscape where fitness apps come and go, Keep Inc. is a steadfast player. Its interim results reflect a company that is not just surviving but thriving. With a solid strategy and a commitment to innovation, Keep is poised for continued success in the ever-evolving fitness market.
As the company prepares for its earnings conference call, stakeholders will be eager to hear more about its future plans. Keep Inc. is not just a fitness platform; it’s a movement. And this movement is gaining momentum.