Smart Share Global Limited Reports Second Quarter 2024 Financial Results

Smart Share Global Limited Reports Second Quarter 2024 Financial Results

Smart Share Global Limited (NASDAQ: EM), also known as "Energy Monster," reported its unaudited financial results for the quarter ended June 30, 2024.

Key Financial Metrics:

Interpretation: For the second quarter of 2024, Smart Share Global Limited’s revenue fell significantly by 55.3% year-over-year (YoY) to $63.7 million, missing consensus estimates of $86.07 million. Net income also saw a notable decrease of 62.4% YoY to $1.3 million. The decline in revenue was primarily due to one-time adjustments from the previous year related to changes in contractual arrangements with network partners.

Revenue Breakdown by Segment:

Interpretation: The company’s primary revenue driver, mobile device charging services, experienced a significant decline, reflecting a 60.0% drop YoY. Revenue from the direct model shrank by 60.7%, and the network partner model saw a 59.7% decrease. Conversely, other revenues surged by 453.7% due to new business initiatives, indicating successful diversification efforts.

Operational Data:

Interpretation: The transition towards the network partner model has progressed, with POIs increasing from 1.245 million to 1.267 million QoQ. The number of available-for-use power banks also increased slightly to 9.5 million. The company achieved 12.8 million newly registered users during the quarter, contributing to a cumulative total of 417.1 million. However, there was a decline in mobile device charging orders from the previous year's 171.8 million.

Comments from Company Officers:

Mars Guangyuan Cai, Chairman and CEO: “Despite the weaker-than-expected consumption environment, we delivered a solid performance this quarter as we returned to profitability. Our commitment to long-term value, even in the current consumption climate, is evident in our ongoing transition towards the network partner model.”

Peifeng Xu, President: “The pace at which we have rebalanced our operations between the direct model and the network partner model has exceeded our initial expectations. Although the shift in our business model has imposed short-term impacts, we remain confident in our long-term prospects.”

Maria Yi Xin, CFO: “Our return to profitability this quarter is a positive development, especially in light of the current transitions. We will continue to pursue higher levels of operational efficiency within our core mobile device charging service.”

Dividends and Share Repurchase Program:

There was no information provided regarding any announced dividends or share repurchase programs.

Forward Guidance:

The company did not provide specific forward guidance.

Stock Price Movement:

Following the earnings release, Smart Share Global Limited's stock experienced a 1.47% increase in its share price.

Overall, Smart Share Global Limited reported a mixed financial performance for the second quarter of 2024, characterized by a significant decline in revenues and net income but a strategic emphasis on transitioning towards a more profitable network partner model. Despite current economic challenges, the company remains optimistic about its long-term growth prospects.