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01/11 03:09
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call presents a positive outlook with strong financial metrics, such as a 15% YoY revenue growth and a significant increase in EngageLab ARR. The new share repurchase plan and high deferred revenue also signal confidence. While there are risks like regulatory challenges and weak demand in certain segments, the overall sentiment from the Q&A and strategic growth plans, including market expansion and AI platform development, are positive. The absence of market cap information suggests a neutral to positive reaction, leaning towards positive due to the strong financial and strategic indicators.
Group Revenue RMB 19.9 million, achieving a remarkable 15% year-over-year and 1% sequential growth. The growth was driven by strong numbers from Developer Services and Financial Risk Management business.
EngageLab ARR RMB 53.7 million in September 2025, representing a 160% year-over-year growth. This growth was attributed to strong customer acquisition and contract value growth.
Financial Risk Management Revenue RMB 22.6 million, with a 33% year-over-year growth and 3% quarter-over-quarter growth. The increase was due to a 44% growth in customer numbers.
Gross Profit RMB 63.8 million, growing 20% year-over-year and 7% quarter-over-quarter. This was the highest gross profit in the past 15 quarters, driven by high-margin revenue.
Developer Subscription Services Revenue RMB 57.3 million, with an 11% year-over-year growth and 7% quarter-over-quarter growth. The growth was driven by an increase in customer numbers and ARPU.
Value-Added Services Revenue RMB 7.1 million, with a 22% year-over-year growth but a 24% quarter-over-quarter decrease. The year-over-year growth was due to an increase in new advertisers, while the sequential decline was due to the absence of a traditional online shopping festival.
Net Operating Cash Inflow RMB 23.3 million, the highest level since Q4 of 2020, indicating strong cash flow generation.
Operating Expenses RMB 64.4 million, representing a 12.8% year-over-year increase and a 5.8% quarter-over-quarter increase. The increase was due to higher staff costs, sales commissions, and marketing expenses for global expansion.
NDR (Net Dollar Retention Rate) 104% for the core developer service business, indicating strong customer retention and increased spending by customers.
Deferred Revenue RMB 166.3 million, a historical high, signifying strong customer loyalty and predictable future revenue.
EngageLab ARR: Reached RMB 53.7 million in September 2025, marking a 160% year-over-year growth.
EngageLab Contract Value: Cumulative contract value reached RMB 128 million by Q3 2025, with RMB 15 million worth of new contracts signed in Q3 alone.
Developer Subscription Services Revenue: Achieved RMB 57.3 million, marking an 11% year-over-year and 7% quarter-over-quarter growth.
Global Expansion of EngageLab: Products and services now sold in over 52 countries and regions, with a 156% year-over-year increase in customer numbers.
Market Share Gains: EngageLab is taking market share from competitors in overseas markets.
Gross Profit: Increased by 20% year-over-year, reaching the highest level in 15 quarters at RMB 63.8 million.
Operating Cash Flow: Net operating cash inflow of RMB 23.3 million, the highest since Q4 2020.
Deferred Revenue: Reached a historical high of RMB 166.3 million, indicating strong customer loyalty and predictable future revenue.
Share Repurchase Program: Board approved a USD 10 million share repurchase program, doubling the previous USD 5 million program.
Market Intelligence Revenue Decline: Market Intelligence revenue decreased by 23% year-over-year and 2% quarter-over-quarter due to continued weak demand for Chinese APP data. This reflects ongoing challenges in this segment, which could impact overall revenue growth.
Value-Added Services Revenue Volatility: Value-added services revenue grew 22% year-over-year but decreased 24% quarter-over-quarter. The absence of traditional online shopping festivals contributed to this decline, indicating potential revenue volatility in this segment.
Increased Operating Expenses: Operating expenses increased by 12.8% year-over-year and 5.8% quarter-over-quarter, driven by higher R&D, sales commissions, and marketing expenses. This could pressure profit margins if revenue growth slows.
Regulatory and Market Risks: The company operates in a highly regulated environment and faces uncertainties in market conditions, as highlighted in the forward-looking statements disclaimer. These factors could adversely impact operations and financial performance.
Dependence on Key Products: The company's growth heavily relies on its flagship product, EngageLab, which, while performing well, represents a concentration risk if market conditions or competition adversely affect its performance.
Weak Demand in Specific Segments: Continued weak demand for Chinese APP data in the Market Intelligence segment poses a challenge to diversifying revenue streams and achieving balanced growth.
Revenue Guidance for Q4 2025: The company expects Q4 2025 revenue to be in the range of RMB 94 million to RMB 96 million, representing a year-over-year growth of 1% to 3% compared to Q4 2024.
EngageLab Growth Expectations: EngageLab's revenue growth momentum is expected to continue for the next 12 to 24 months, driven by strong global customer acquisition and market share gains.
Deferred Revenue and SaaS Business Sustainability: The company highlighted a historical high deferred revenue of RMB 166.3 million, indicating strong customer loyalty and predictable future revenue.
Market Intelligence Segment Outlook: The Market Intelligence segment is expected to face continued weak demand for Chinese app data, aligning with current market conditions.
Share Repurchase Program: The company announced a new share repurchase program, authorizing up to USD 10 million worth of ordinary shares or ADS over the next 12 months, doubling the previous program's size.
Share Repurchase Plan: In the quarter ended September 30, 2025, the company repurchased 4,000 ADS. Cumulatively, a total of 327,000 ADS have been repurchased since the start of the repurchase program. Additionally, the Board of Directors approved a new share repurchase program authorizing the company to repurchase up to USD 10 million worth of its ordinary shares, including in the form of ADS, during the 12-month period starting from the approval date. This represents a 100% increase from the previous USD 5 million program. The repurchases may be made in the open market, private negotiated transactions, block trades, or other legally permissible means, depending on market conditions and applicable regulations. The repurchase will be funded using the company's existing cash.
The earnings call presents a positive outlook with strong financial metrics, such as a 15% YoY revenue growth and a significant increase in EngageLab ARR. The new share repurchase plan and high deferred revenue also signal confidence. While there are risks like regulatory challenges and weak demand in certain segments, the overall sentiment from the Q&A and strategic growth plans, including market expansion and AI platform development, are positive. The absence of market cap information suggests a neutral to positive reaction, leaning towards positive due to the strong financial and strategic indicators.
The earnings call summary presents a mixed picture. While financial performance shows strong growth in certain areas, such as EngageLab and financial risk management, there are concerns about the decline in market intelligence revenue and increased operating expenses. The Q&A section did not provide additional clarity, leaving some uncertainty. The share repurchase plan is a positive signal, but operational efficiency challenges and regulatory risks weigh negatively. Overall, the balance of positive growth and negative risks suggests a neutral stock price movement in the short term.
The earnings call highlights strong financial performance with a 38% revenue growth, positive EBITDA, and improved gross margins. The company shows promising expansion with a 127% revenue increase in EngageLab and a successful share repurchase program. Despite some market demand weaknesses and regulatory risks, optimistic guidance and strategic investments in AI and global expansion suggest positive future prospects. The Q&A section reveals cautious optimism, with a focus on balancing growth and profitability. Overall, these factors indicate a likely positive stock price movement in the short term.
The company demonstrated strong financial performance with record revenue achievements, positive adjusted EBITDA, and robust cash management. The EngageLab business and overseas expansion indicate strategic growth potential. Despite some regulatory and market demand risks, the overall sentiment remains positive due to successful financial metrics, share repurchase program, and optimistic guidance. The Q&A section reinforced confidence in future revenue trends, despite some lack of clarity. Given the positive financial outlook and strategic initiatives, a positive stock price movement is expected.
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