RLX Technology Announces Unaudited Second Quarter 2023 Financial Results
- Net revenues decreased significantly from Q2 2022 to Q2 2023.
- Gross margin declined from the previous year.
- U.S. GAAP net income decreased in Q2 2023 compared to Q2 2022.
- Non-GAAP net income also decreased year-over-year.
- None.
Second Quarter 2023 Financial Highlights
- Net revenues were
RMB378.1 million (US ) in the second quarter of 2023, compared with$52.1 million RMB2,233.9 million in the same period of 2022. - Gross margin was
26.1% in the second quarter of 2023, compared with43.8% in the same period of 2022. U.S. GAAP net income wasRMB204.7 million (US ) in the second quarter of 2023, compared with$28.2 million U.S. GAAP net income ofRMB441.6 million in the same period of 2022.- Non-GAAP net income[1] was
RMB86.2 million (US ) in the second quarter of 2023, compared with$11.9 million RMB634.7 million in the same period of 2022.
[1] Non-GAAP net income is a non-GAAP financial measure. For more information on the Company's non-GAAP financial measures, please see the section "Non-GAAP Financial Measures" and the table captioned "Unaudited Reconciliation of GAAP and Non-GAAP Results" set forth at the end of this press release. |
"During the second quarter of 2023, we continued to firmly execute our core strategy amid the challenging market environment," said Ms. Ying (Kate) Wang, Co-founder, Chairperson of the Board of Directors, and CEO of RLX Technology. "Specifically, we remained dedicated to offering compliant, high-quality products while developing new products to meet users' evolving needs. Though the recent resurgence of illegal products has had a lingering impact on our sales, we believe the impact will be temporary rather than a major trend that could derail our recovery trajectory. As a trusted e-vapor brand for adult smokers, we remain confident that, supported by regulatory oversight, our premium products will continue to win users' trust and gradually supplant inferior and harmful illegal products. Moving forward, we will continue prioritizing product innovation, harm reduction, and quality control initiatives while further enhancing our product portfolio as we strive to create sustainable value for all stakeholders."
Mr. Chao Lu, Chief Financial Officer of RLX Technology, commented, "In light of the external challenges, especially the disruptions from illegal products, we deepened our focus on efficiency and profitability improvement during the second quarter. Thanks to our supply chain optimizations and product design enhancements, our topline improved sequentially to
Second Quarter 2023 Financial Results
Net revenues were
Gross profit was
Gross margin was
Operating expenses were
Selling expenses were
General and administrative expenses were positive
Research and development expenses were
Income from operations was
Income tax expense was
Non-GAAP net income was
Non-GAAP basic and diluted net income per ADS[2] were
[2] Non-GAAP basic and diluted net income per ADS is a non-GAAP financial measure. For more information on the Company's non-GAAP financial measures, please see the section "Non-GAAP Financial Measures" and the table captioned "Unaudited Reconciliation of GAAP and Non-GAAP Results" set forth at the end of this press release. |
Balance Sheet and Cash Flow
As of June 30, 2023, the Company had cash and cash equivalents, restricted cash, short-term bank deposits, net, short-term investments, long-term bank deposits, net and long-term investment securities, net of
Conference Call
The Company's management will host an earnings conference call at 8:00 AM
Dial-in details for the earnings conference call are as follows:
+1-888-317-6003 | |
International: | +1-412-317-6061 |
+800-963-976 | |
+852-5808-1995 | |
Mainland | 400-120-6115 |
Participant Code: | 3325354 |
Participants should dial in 10 minutes before the scheduled start time and ask to be connected to the call for "RLX Technology Inc." with the Participant Code as set forth above.
Additionally, a live and archived webcast of the conference call will be available on the Company's investor relations website at https://ir.relxtech.com.
A replay of the conference call will be accessible approximately two hours after the conclusion of the call until August 25, 2023, by dialing the following telephone numbers:
+1-877-344-7529 | |
International: | +1-412-317-0088 |
Replay Access Code: | 5550144 |
About RLX Technology Inc.
RLX Technology Inc. (NYSE: RLX) is a leading branded e-vapor company in
For more information, please visit: http://ir.relxtech.com.
Non-GAAP Financial Measures
The Company uses non-GAAP net income and non-GAAP basic and diluted net income per ADS, each a non-GAAP financial measure, in evaluating its operating results and for financial and operational decision-making purposes. Non-GAAP net income represents net income excluding share-based compensation expenses. Non-GAAP basic and diluted net income per ADS is computed using non-GAAP net income attributable to RLX Technology Inc. and the same number of ADSs used in
The Company presents these non-GAAP financial measures because they are used by the management to evaluate its operating performance and formulate business plans. The Company believes that they help identify underlying trends in its business that could otherwise be distorted by the effect of certain expenses that are included in net income. The Company also believes that the use of the non-GAAP measures facilitates investors' assessment of its operating performance, as they could provide useful information about its operating results, enhances the overall understanding of its past performance and future prospects and allows for greater visibility with respect to key metrics used by the management in its financial and operational decision making.
The non-GAAP financial measures are not defined under
For more information on the non-GAAP financial measures, please see the table captioned "Unaudited Reconciliation of GAAP and non-GAAP Results" set forth at the end of this press release.
Exchange Rate Information
This announcement contains translations of certain RMB amounts into
Safe Harbor Statement
This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the
For more information, please contact:
In
RLX Technology Inc.
Head of Capital Markets
Sam Tsang
Email: ir@relxtech.com
Piacente Financial Communications
Jenny Cai
Tel: +86-10-6508-0677
Email: RLX@tpg-ir.com
In
Piacente Financial Communications.
Brandi Piacente
Tel: +1-212-481-2050
Email: RLX@tpg-ir.com
RLX TECHNOLOGY INC. | ||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | ||||
(All amounts in thousands) | ||||
As of | ||||
December 31, | June 30, | June 30, | ||
2022 | 2023 | 2023 | ||
RMB | RMB | US$ | ||
ASSETS | ||||
Current assets: | ||||
Cash and cash equivalents | 1,268,512 | 1,761,694 | 242,949 | |
Restricted cash | 20,574 | 15,750 | 2,172 | |
Short-term bank deposits, net | 7,084,879 | 5,221,295 | 720,049 | |
Receivables from online payment platforms | 3,000 | 4,948 | 682 | |
Short-term investments | 2,434,864 | 2,210,005 | 304,774 | |
Accounts and notes receivable, net | 51,381 | 87,412 | 12,055 | |
Inventories | 130,901 | 90,178 | 12,436 | |
Amounts due from related parties | 5,112 | 38,352 | 5,289 | |
Prepayments and other current assets, net | 198,932 | 397,337 | 54,795 | |
Total current assets | 11,198,155 | 9,826,971 | 1,355,201 | |
Non-current assets: | ||||
Property, equipment and leasehold improvement, net | 87,871 | 78,755 | 10,861 | |
Intangible assets, net | 7,552 | 6,977 | 962 | |
Long-term investments, net | 8,000 | 8,000 | 1,103 | |
Deferred tax assets, net | 63,894 | 63,894 | 8,812 | |
Right-of-use assets, net | 75,008 | 79,710 | 10,993 | |
Long-term bank deposits, net | 1,515,428 | 2,306,679 | 318,106 | |
Long-term investment securities, net | 3,409,458 | 4,271,197 | 589,025 | |
Other non-current assets, net | 13,458 | 8,029 | 1,107 | |
Total non-current assets | 5,180,669 | 6,823,241 | 940,969 | |
Total assets | 16,378,824 | 16,650,212 | 2,296,170 | |
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||
Current liabilities: | ||||
Accounts and notes payable | 269,346 | 132,193 | 18,230 | |
Contract liabilities | 75,226 | 94,531 | 13,036 | |
Salary and welfare benefits payable | 127,749 | 94,050 | 12,970 | |
Taxes payable | 109,676 | 82,290 | 11,348 | |
Amounts due to related parties | 423 | - | - | |
Accrued expenses and other current liabilities | 161,455 | 120,058 | 16,557 | |
Lease liabilities - current portion | 45,955 | 49,286 | 6,797 | |
Total current liabilities | 789,830 | 572,408 | 78,938 | |
Non-current liabilities: | ||||
Deferred tax liabilities | 8,653 | 8,653 | 1,193 | |
Lease liabilities - non-current portion | 39,968 | 38,878 | 5,361 | |
Total non-current liabilities | 48,621 | 47,531 | 6,554 | |
Total liabilities | 838,451 | 619,939 | 85,492 | |
Shareholders' Equity: | ||||
Total RLX Technology Inc. shareholders' equity | 15,569,060 | 16,056,370 | 2,214,279 | |
Noncontrolling interests | (28,687) | (26,097) | (3,601) | |
Total shareholders' equity | 15,540,373 | 16,030,273 | 2,210,678 | |
Total liabilities and shareholders' equity | 16,378,824 | 16,650,212 | 2,296,170 | |
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF | |||||||||
(All amounts in thousands, except for share and per share data) | |||||||||
For the three months ended | For the six months ended | ||||||||
June 30, | March 31, | June 30, | June 30, | June 30, | June 30, | June 30, | |||
2022 | 2023 | 2023 | 2023 | 2022 | 2023 | 2023 | |||
RMB | RMB | RMB | US$ | RMB | RMB | US$ | |||
Net revenues | 2,233,893 | 188,877 | 378,123 | 52,146 | 3,948,343 | 567,000 | 78,193 | ||
Cost of revenues | (1,256,010) | (78,693) | (171,733) | (23,683) | (2,313,457) | (250,426) | (34,535) | ||
Excise tax on products | - | (64,458) | (107,853) | (14,874) | - | (172,311) | (23,763) | ||
Gross profit | 977,883 | 45,726 | 98,537 | 13,589 | 1,634,886 | 144,263 | 19,895 | ||
Operating expenses: | |||||||||
Selling expenses | (122,634) | (85,761) | (45,226) | (6,237) | (198,581) | (130,987) | (18,064) | ||
General and administrative expenses | (290,745) | (256,504) | 41,368 | 5,705 | (224,350) | (215,136) | (29,669) | ||
Research and development expenses | (117,567) | (76,682) | (43,317) | (5,974) | (141,574) | (119,999) | (16,549) | ||
Total operating expenses | (530,946) | (418,947) | (47,175) | (6,506) | (564,505) | (466,122) | (64,282) | ||
Income/(loss) from operations | 446,937 | (373,221) | 51,362 | 7,083 | 1,070,381 | (321,859) | (44,387) | ||
Other income: | |||||||||
Interest income, net | 42,724 | 148,803 | 162,888 | 22,463 | 69,875 | 311,691 | 42,984 | ||
Investment income | 40,631 | 21,385 | 20,588 | 2,839 | 72,870 | 41,973 | 5,788 | ||
Others, net | 115,586 | 129,157 | 21,380 | 2,948 | 232,443 | 150,537 | 20,760 | ||
Income/(loss) before income tax | 645,878 | (73,876) | 256,218 | 35,333 | 1,445,569 | 182,342 | 25,145 | ||
Income tax (expense)/benefit | (204,316) | 17,571 | (51,502) | (7,102) | (316,952) | (33,931) | (4,679) | ||
Net income/(loss) | 441,562 | (56,305) | 204,716 | 28,231 | 1,128,617 | 148,411 | 20,466 | ||
Less: net (loss)/income attributable to | (19,499) | 661 | 1,929 | 266 | (37,725) | 2,590 | 357 | ||
Net income/(loss) attributable to RLX | 461,061 | (56,966) | 202,787 | 27,965 | 1,166,342 | 145,821 | 20,109 | ||
Other comprehensive loss: | |||||||||
Foreign currency translation adjustments | 580,438 | (148,096) | 563,078 | 77,652 | 534,614 | 414,982 | 57,229 | ||
Unrealized income on long-term investment securities | - | 2,873 | 5,539 | 764 | - | 8,412 | 1,160 | ||
Total other comprehensive income/(loss) | 580,438 | (145,223) | 568,617 | 78,416 | 534,614 | 423,394 | 58,389 | ||
Total comprehensive income/(loss) | 1,022,000 | (201,528) | 773,333 | 106,647 | 1,663,231 | 571,805 | 78,855 | ||
Less: total comprehensive (loss)/income | (19,499) | 661 | 1,929 | 266 | (37,725) | 2,590 | 357 | ||
Total comprehensive income/(loss) attributable | 1,041,499 | (202,189) | 771,404 | 106,381 | 1,700,956 | 569,215 | 78,498 | ||
Net income/(loss) per ordinary share/ADS | |||||||||
Basic | 0.348 | (0.043) | 0.154 | 0.021 | 0.877 | 0.111 | 0.015 | ||
Diluted | 0.347 | (0.043) | 0.150 | 0.021 | 0.867 | 0.108 | 0.015 | ||
Weighted average number of ordinary | |||||||||
Basic | 1,323,877,777 | 1,316,798,713 | 1,318,628,588 | 1,318,628,588 | 1,329,964,500 | 1,317,718,705 | 1,317,718,705 | ||
Diluted | 1,330,060,097 | 1,316,798,713 | 1,353,296,802 | 1,353,296,802 | 1,345,014,312 | 1,348,021,483 | 1,348,021,483 |
RLX TECHNOLOGY INC. | ||||||||
UNAUDITED RECONCILIATION OF GAAP AND NON-GAAP RESULTS | ||||||||
(All amounts in thousands, except for share and per share data) | ||||||||
For the three months ended | For the six months ended | |||||||
June 30, | March 31, | June 30, | June 30, | June 30, | June 30, | June 30, | ||
2022 | 2023 | 2023 | 2023 | 2022 | 2023 | 2023 | ||
RMB | RMB | RMB | US$ | RMB | RMB | US$ | ||
Net income/(loss) | 441,562 | (56,305) | 204,716 | 28,231 | 1,128,617 | 148,411 | 20,466 | |
Add: share-based compensation expenses | ||||||||
Selling expenses | 17,896 | 23,955 | (15,338) | (2,115) | (24,043) | 8,617 | 1,188 | |
General and administrative expenses | 151,069 | 201,343 | (90,923) | (12,539) | (79,018) | 110,420 | 15,228 | |
Research and development expenses | 24,213 | 14,654 | (12,229) | (1,686) | (28,998) | 2,425 | 334 | |
Non-GAAP net income | 634,740 | 183,647 | 86,226 | 11,891 | 996,558 | 269,873 | 37,216 | |
Net income/(loss) attributable to RLX Technology | 461,061 | (56,966) | 202,787 | 27,965 | 1,166,342 | 145,821 | 20,109 | |
Add: share-based compensation expenses | 193,178 | 239,952 | (118,490) | (16,340) | (132,059) | 121,462 | 16,750 | |
Non-GAAP net income attributable to RLX | 654,239 | 182,986 | 84,297 | 11,625 | 1,034,283 | 267,283 | 36,859 | |
Non-GAAP net income per ordinary share/ADS | ||||||||
- Basic | 0.494 | 0.139 | 0.064 | 0.009 | 0.778 | 0.203 | 0.028 | |
- Diluted | 0.492 | 0.136 | 0.062 | 0.009 | 0.769 | 0.198 | 0.027 | |
Weighted average number of ordinary | ||||||||
- Basic | 1,323,877,777 | 1,316,798,713 | 1,318,628,588 | 1,318,628,588 | 1,329,964,500 | 1,317,718,705 | 1,317,718,705 | |
- Diluted | 1,330,060,097 | 1,345,828,279 | 1,353,296,802 | 1,353,296,802 | 1,345,014,312 | 1,348,021,483 | 1,348,021,483 |
RLX TECHNOLOGY INC. | |||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||
(All amounts in thousands) | |||||||||
For the three months ended | For the six months ended | ||||||||
June 30, | March 31, | June 30, | June 30, | June 30, | June 30, | June 30, | |||
2022 | 2023 | 2023 | 2023 | 2022 | 2023 | 2023 | |||
RMB | RMB | RMB | US$ | RMB | RMB | US$ | |||
Net cash generated from/(used in) operating | 1,444,388 | (230,686) | 41,339 | 5,701 | 1,752,557 | (189,347) | (26,112) | ||
Net cash (used in)/generated from investing | (4,145,885) | 381,954 | 431,683 | 59,532 | (5,096,649) | 813,637 | 112,206 | ||
Net cash (used in)/generated from financing | (145,189) | 4,346 | (199,080) | (27,454) | (306,801) | (194,734) | (26,855) | ||
Effect of foreign exchange rate changes on cash, | 171,597 | 10,409 | 48,393 | 6,673 | 151,041 | 58,802 | 8,109 | ||
Net (decrease)/increase in cash and cash | (2,675,089) | 166,023 | 322,335 | 44,452 | (3,499,852) | 488,358 | 67,348 | ||
Cash, cash equivalents and restricted cash at | 4,384,704 | 1,289,086 | 1,455,109 | 200,669 | 5,209,467 | 1,289,086 | 177,773 | ||
Cash, cash equivalents and restricted cash at | 1,709,615 | 1,455,109 | 1,777,444 | 245,121 | 1,709,615 | 1,777,444 | 245,121 |
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SOURCE RLX Technology Inc.
FAQ
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