Latest news with #ZEPP
Yahoo
21-05-2025
- Business
- Yahoo
Zepp Health Corp (ZEPP) Q1 2025 Earnings Call Highlights: Revenue Growth and Strategic ...
Amazfit Revenue Growth: 10% year-over-year increase in Amazfit revenue. Gross Margin: Achieved 37.3%, higher than both Q4 2024 and Q1 2024. Operating Expenses: USD31.5 million in Q1 2025, up from USD29.3 million in Q4 2024 and USD27.8 million in Q1 2024. Adjusted Operating Loss: USD17.2 million in Q1 2025, compared to USD13.1 million in Q1 2024. Cash Balance: USD104 million as of March 31, 2025, down from USD110 million in Q4 2024. Debt Repayment: USD11.5 million repaid in Q1 2025, with a total of USD67.8 million retired cumulatively. Revenue Guidance for Q2 2025: Expected to be in the range of USD50 million to USD55 million, indicating 23% to 35% year-over-year growth. Warning! GuruFocus has detected 5 Warning Signs with ZEPP. Release Date: May 20, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Zepp Health Corp (NYSE:ZEPP) reported a 10% year-over-year growth in Amazfit revenue, marking the first growth after a two-year transformation period. The company successfully launched new products, Amazfit Active 2 and Amazfit Bip 6, which received positive reviews and strong initial sales momentum. Zepp Health Corp (NYSE:ZEPP) has diversified its supply chain by expanding operations in Vietnam and exploring opportunities in the NAFTA region, enhancing operational agility. The company achieved a gross margin of 37.3% in Q1 2025, higher than both Q4 2024 and Q1 2024, driven by new product launches. Zepp Health Corp (NYSE:ZEPP) has strengthened its brand presence through strategic partnerships with athletes and participation in global events, enhancing brand visibility and market share. Despite the sales growth, fixed operating expenses were not fully absorbed, putting pressure on operating profit. The company faced a $1 million impact from foreign exchange headwinds during the quarter. Operating expenses increased year-over-year, driven by higher R&D and marketing expenses. Zepp Health Corp (NYSE:ZEPP) reported an adjusted operating loss of $17.2 million for Q1 2025, compared to a loss of $13.1 million in the same period of 2024. The company remains exposed to potential tariff impacts, with an estimated $2 million to $3 million impact for the full year 2025, although efforts are being made to offset this through efficiency gains. Q: Can you provide more details on the impact of tariffs, especially considering the 90-day pause and potential increase to 46% in July? A: Leon Cheng Deng, CFO, explained that the full-year tariff impact is estimated to be around $2 million to $3 million, based on a 10% tariff. This impact is expected to be fully offset by global operating efficiency gains. Zepp Health's smartwatches are exempt from the highest tariffs, and the company uses Vietnam as a backup for dual sourcing. They plan to front-load inventories to mitigate potential tariff impacts. Q: Are you and your competitors planning to raise prices to pass costs to consumers? A: Leon Cheng Deng, CFO, stated that Zepp Health is not planning to be the first mover in raising prices. They will monitor competitors like Apple and Garmin and adjust pricing strategies on a region-by-region basis if necessary. Q: When do you expect to achieve your goal of reducing operating expenses to $25 million to $27 million per quarter? A: Leon Cheng Deng, CFO, mentioned that a significant reduction is expected in Q2. The high expenses in Q1 were due to product launch events and currency exchange headwinds, which are not recurring. Q: How many new products or upgrades are planned for the remainder of the year? A: Leon Cheng Deng, CFO, indicated that Zepp Health aims to refresh all major product lines throughout the year, with more than two new products expected in the upcoming quarters. Q: Can you provide more color on the full-year 2025 performance expectations? A: Leon Cheng Deng, CFO, expressed optimism for 2025, highlighting a strong lineup of new products and expected revenue growth, particularly in the second half of the year. The company anticipates maintaining or improving gross margins and offsetting tariff costs with operational efficiencies. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus.
Yahoo
21-05-2025
- Business
- Yahoo
Zepp Health Corp (ZEPP) Q1 2025 Earnings Call Highlights: Revenue Growth and Strategic ...
Amazfit Revenue Growth: 10% year-over-year increase in Amazfit revenue. Gross Margin: Achieved 37.3%, higher than both Q4 2024 and Q1 2024. Operating Expenses: USD31.5 million in Q1 2025, up from USD29.3 million in Q4 2024 and USD27.8 million in Q1 2024. Adjusted Operating Loss: USD17.2 million in Q1 2025, compared to USD13.1 million in Q1 2024. Cash Balance: USD104 million as of March 31, 2025, down from USD110 million in Q4 2024. Debt Repayment: USD11.5 million repaid in Q1 2025, with a total of USD67.8 million retired cumulatively. Revenue Guidance for Q2 2025: Expected to be in the range of USD50 million to USD55 million, indicating 23% to 35% year-over-year growth. Warning! GuruFocus has detected 5 Warning Signs with ZEPP. Release Date: May 20, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Zepp Health Corp (NYSE:ZEPP) reported a 10% year-over-year growth in Amazfit revenue, marking the first growth after a two-year transformation period. The company successfully launched new products, Amazfit Active 2 and Amazfit Bip 6, which received positive reviews and strong initial sales momentum. Zepp Health Corp (NYSE:ZEPP) has diversified its supply chain by expanding operations in Vietnam and exploring opportunities in the NAFTA region, enhancing operational agility. The company achieved a gross margin of 37.3% in Q1 2025, higher than both Q4 2024 and Q1 2024, driven by new product launches. Zepp Health Corp (NYSE:ZEPP) has strengthened its brand presence through strategic partnerships with athletes and participation in global events, enhancing brand visibility and market share. Despite the sales growth, fixed operating expenses were not fully absorbed, putting pressure on operating profit. The company faced a $1 million impact from foreign exchange headwinds during the quarter. Operating expenses increased year-over-year, driven by higher R&D and marketing expenses. Zepp Health Corp (NYSE:ZEPP) reported an adjusted operating loss of $17.2 million for Q1 2025, compared to a loss of $13.1 million in the same period of 2024. The company remains exposed to potential tariff impacts, with an estimated $2 million to $3 million impact for the full year 2025, although efforts are being made to offset this through efficiency gains. Q: Can you provide more details on the impact of tariffs, especially considering the 90-day pause and potential increase to 46% in July? A: Leon Cheng Deng, CFO, explained that the full-year tariff impact is estimated to be around $2 million to $3 million, based on a 10% tariff. This impact is expected to be fully offset by global operating efficiency gains. Zepp Health's smartwatches are exempt from the highest tariffs, and the company uses Vietnam as a backup for dual sourcing. They plan to front-load inventories to mitigate potential tariff impacts. Q: Are you and your competitors planning to raise prices to pass costs to consumers? A: Leon Cheng Deng, CFO, stated that Zepp Health is not planning to be the first mover in raising prices. They will monitor competitors like Apple and Garmin and adjust pricing strategies on a region-by-region basis if necessary. Q: When do you expect to achieve your goal of reducing operating expenses to $25 million to $27 million per quarter? A: Leon Cheng Deng, CFO, mentioned that a significant reduction is expected in Q2. The high expenses in Q1 were due to product launch events and currency exchange headwinds, which are not recurring. Q: How many new products or upgrades are planned for the remainder of the year? A: Leon Cheng Deng, CFO, indicated that Zepp Health aims to refresh all major product lines throughout the year, with more than two new products expected in the upcoming quarters. Q: Can you provide more color on the full-year 2025 performance expectations? A: Leon Cheng Deng, CFO, expressed optimism for 2025, highlighting a strong lineup of new products and expected revenue growth, particularly in the second half of the year. The company anticipates maintaining or improving gross margins and offsetting tariff costs with operational efficiencies. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus.
Yahoo
27-03-2025
- Business
- Yahoo
Zepp Health Corp (ZEPP) Q4 2024 Earnings Call Highlights: Strong Sales Growth Amid Challenges
Release Date: March 26, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Zepp Health Corp (NYSE:ZEPP) reported a 40% quarter-over-quarter sales increase in Q4 2024, aligning with their guidance. The company's gross margin for 2024 improved significantly to 39% from 26.2% in 2023. The successful launch of the T-Rex 3 smartwatch, featuring advanced AI technology, has driven substantial growth and positive market feedback. Zepp Health Corp (NYSE:ZEPP) has diversified its product lineup with new launches like the Masfe Active 2, which has received positive reviews. The company has strategically managed its supply chain to mitigate the impact of US tariffs, with 20-25% of manufacturing now outside China. Overall revenue declined year-over-year due to a decrease in Xiaomi product sales and limited new product launches. The company reported an adjusted operating loss of $7.4 million in Q4 2024, primarily due to lower sales volume. Net loss for Q4 2024 was $36.9 million, impacted by investment impairments and deferred tax asset valuation allowances. Zepp Health Corp (NYSE:ZEPP) faces challenges from macroeconomic issues affecting the global consumer market. The stock remains illiquid, and the company acknowledges being undervalued in the market. Warning! GuruFocus has detected 5 Warning Signs with ZEPP. Q: Regarding the new tariffs on Chinese smartwatch imports to the US, you mentioned there'll be minimal impact due to supply chain management. Could you please expand on this point? A: We have been working on a dual sourcing strategy for 2 to 3 years. The US tariff targets goods manufactured in China and shipped to the US. We mitigate this by using our manufacturing base in Southeast Asia, avoiding the tariff impact on Chinese goods. (CFO) Q: Can you disclose what percent of your overall manufacturing comes from outside China? A: Currently, 20 to 25% of our overall portfolio is manufactured outside China, specifically for products sold in the United States. (CFO) Q: Could you give more color on the impairment loss from investments and the increase in taxes? A: The impairment losses stem from investments in upstream and downstream technology companies that didn't perform as expected due to macroeconomic headwinds. The deferred tax asset increase is a technical accounting adjustment due to reported losses, which are non-cash and one-off in nature. (CFO) Q: Are you seeing a shift in demand towards lower-priced players in the smartwatch market? A: Contrary to that, while the market overall declined, segments like outdoor and sports smartwatches are growing. Our T-Rex 3 launch gained significant market share, especially in developed countries. The decline is more due to a lack of new features in Apple Watches and a collapse in the ultra-cheap smartwatch market in India. (CFO) Q: How is Zepp Health tracking against its vision of building a global health ecosystem, given most revenue still comes from wearables? A: Besides smartwatches, we are diversifying our product portfolio with items like earbuds and hearing aids. We are also exploring services like sleep monitoring to create a subscription business. In the long term, we aim to partner with insurance and enterprises to develop a comprehensive ecosystem. (COO) Q: What is the perspective on the relationship with Xiaomi, given their market share growth and your product disengagement? A: Our relationship with Xiaomi remains strong. Our strategic shift is to transform from an OEM/ODM model to a branded smartwatch company. We aim to sustain profitability through self-branded product sales before considering expanding revenue with Xiaomi or other large customers. (CFO) Q: What is being done about the stock's illiquidity? A: We believe the company is undervalued. We've refinanced short-term debts to long-term, ensuring no immediate maturities. We continue our stock buyback program and are prepared to upsize it. As we prove our transformation strategy, we expect improved liquidity and share price recovery. (CFO) Q: Could you provide more information about the new product roadmap for 2025 and its impact on growth? A: We have different smartwatch lines targeting various price segments. In 2025, we plan to launch new products every quarter, which will drive revenue growth. Our T-Rex 3 and other products have already gained significant traction, and we expect this trend to continue. (CFO) For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Sign in to access your portfolio
