Viomi Technology Co Ltd Reports Q2 2024 Financial Results
Intellectia.AI2024-08-27
Viomi Technology Co., Ltd Reports Q2 2024 Financial Results
Viomi Technology Co., Ltd (NASDAQ:VIOT) has announced its financial results for the first half of 2024.
Key Financial Metrics
| Metric | Q2 2024 | Q2 2023 | Year-over-Year Change | Consensus Estimates (Q2 2024) |
|---|---|---|---|---|
| Total Revenue | $143.3M | $179.8M | -20.5% | - |
| Gross Profit | $35.5M | $39.5M | -10.1% | - |
| Gross Margin | 24.8% | 22% | +2.8 pp | - |
| Net Income | $0.82M | -$0.24M | N/A | - |
Interpretation: Viomi Technology experienced a 20.5% year-over-year decline in total revenue, driven by a strategic shift in focus toward home water solutions. However, the company's gross margin improved by 2.8 percentage points, reflecting enhanced cost controls and a favorable product mix. Notably, Viomi swung to a net income of $0.82 million, indicating the effectiveness of its renewed focus.
Segment Revenue Performance
| Segment | Q2 2024 Revenue | Q2 2023 Revenue | Year-over-Year Change |
|---|---|---|---|
| IoT @ Home Portfolio | $66.9M | $96.1M | -30.3% |
| Home Water Solutions | $44.9M | $39.9M | +12.9% |
| Consumables | $19.0M | $19.0M | 0% |
| Small Appliances & Others | $13.8M | $26.5M | -48.0% |
Interpretation: The Home Water Solutions segment saw a 12.9% year-over-year revenue increase, reflecting the company's strategic emphasis on this category. However, revenues from the IoT @ Home Portfolio and Small Appliances & Others declined markedly by 30.3% and 48.0%, respectively, due to Viomi's decision to streamline less profitable segments.
Key Developments and Operational Highlights
- Implemented a focused strategy prioritizing high-quality development.
- Year-over-year operating expenses declined by 19.2%, supporting improved net profits.
- Major business reorganization planned for completion by the end of August.
- Viomi will leverage its core strength in water purification and divest certain underperforming IoT-related businesses.
Comments from Company Officers
Xiaoping Chen, Founder and CEO, emphasized the company's dedication to leveraging AI for high-quality home water solutions. He noted, "Viomi has built an extensive expertise in AI technology, and our smart water purifiers provide hassle-free and affordable essential for a healthy lifestyle." The CEO also highlighted ongoing strategic partnerships and global market expansion efforts.
Dividends and Share Repurchase Program
No dividends or share repurchase programs were announced during this reporting period.
Forward Guidance
For the full-year 2024, Viomi expects: - Revenues from continuing businesses to be between RMB1.7 billion and RMB1.9 billion. - Income from operations from continuing businesses to range between RMB110 million and RMB130 million.
Stock Price Movement
Following the earnings release, Viomi's stock saw a minor decline of -0.28%, reflecting a cautious market reaction to the company's financial results and strategic reorganization efforts.
In summary, Viomi Technology's first-half 2024 financial performance reflects a strategic pivot towards high-margin home water solutions and cost management initiatives, setting up a path for sustainable growth despite short-term revenue contractions in other segments.
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