Haoxi Health Technology Limited Reports Financial Results for Fiscal Year Ended June 30, 2024
Rhea-AI Summary
Haoxi Health Technology (HAO) reported strong financial results for fiscal year 2024. Net revenue increased 72% to $48.52 million, up from $28.23 million in 2023. Gross profit rose 33% to $2.75 million, while net income grew 33% to $1.29 million. The company expanded its customer base from 393 to 543 clients, with average revenue per client increasing from $71,830 to $89,355. HAO's cash position strengthened to $6.66 million from $1.20 million year-over-year. The company recently closed a $12 million follow-on offering and announced a strategic partnership with AI platform Gauss Intelligence.
Positive
- Net revenue grew 72% YoY to $48.52 million
- Net income increased 33% to $1.29 million
- Customer base expanded by 38% to 543 clients
- Average revenue per client rose to $89,355 from $71,830
- Cash position increased to $6.66 million from $1.20 million
- Successfully raised $12 million through follow-on offering
Negative
- Gross margin declined to 5.7% from 7.3% due to competitive pressures
- General and administrative expenses increased 17% to $911,531
- Income tax expenses doubled to $443,582 from $220,653
Insights
HAO shows mixed financial performance with notable revenue growth but concerning margin compression. Revenue surged
The recent
The Chinese online marketing sector shows intense competition, evidenced by HAO's need to offer rebates to maintain market share. The company's focus on healthcare clients and partnership with ByteDance platforms demonstrates strategic positioning, but the declining margins suggest pricing power. The post-COVID recovery in China has benefited digital advertising, as shown by increased click-through rates and service volume.
The Gauss Intelligence AI partnership could provide differentiation in an increasingly commoditized market. However, the low R&D investment relative to revenue (
BEIJING, Oct. 29, 2024 (GLOBE NEWSWIRE) -- Haoxi Health Technology Limited (the “Company” or “HAO”), an online marketing solution provider headquartered in Beijing, China, today reported its financial results for the fiscal year ended June 30, 2024.
Financial Highlights for Fiscal 2024
- Net revenue for the fiscal year ended June 30, 2024 grew by
72% to$48.52 million , up from$28.23 million in 2023. - Gross profit increased by
33% to$2.75 million for the fiscal year ended June 30, 2024 from$2.06 million in the fiscal year ended June 30, 2023. - Net income grew by
33.0% to$1.29 million for the fiscal year ended June 30, 2024, up from$0.97 million in the fiscal year ended June 30, 2023.
Mr. Zhen Fan, Chairman and Chief Executive Officer of the Company, stated that, “HAO has experienced financial growth in the fiscal year ended June 30, 2024, with net revenue increasing from
“While costs rose in tandem with revenue, which increased from
Recent Developments
On September 25, 2024, the Company announced a strategic partnership with AI platform Gauss Intelligence (Beijing) Technology Co., Ltd., a subsidiary of Global Mofy AI Ltd (Nasdaq: GMM). This collaboration aims to leverage the advanced capabilities of Gausspeed, a generative AI platform, with HAO’s application scenarios to deliver AI marketing solutions.
On September 20, 2024, the Company announced the closing of a follow-on offering underwritten by EF Hutton LLC, to raise aggregate gross proceeds of
Results of Operations for the Fiscal Year Ended June 30, 2024
Revenue
The Company generates revenue from one-stop online marketing solutions, including traffic acquisition from mainstream online media platforms, content production, data analysis and advertising campaign optimization, to advertisers through its operating entity, Beijing Haoxi Digital Technology Co. Ltd. in the People’s Republic of China.
Net revenue was
The average revenue per client under our advertisement pricing model consists of two components: 1) the average per unit-of-service price, which is the average price per click-through that we charge our advertiser customers, and 2) the quantity of services, which is the actual number of click-throughs with respect to each advertiser.
The increase in our quantity of services was because more people determined to use online services since the beginning of the COVID-19 pandemic, and the strong recovery from our client base since January 2024 occurred when the COVID control measures were lifted in China. In addition we attribute the increase in services, in part to the increasing popularity of ByteDance media platforms, which we mainly collaborated with, among our advertiser customers.
Cost of revenue
Our cost of revenue(“COR”) consists primarily of the purchase of online traffic from third-party media platforms after deducting rebates, and salaries and benefits for business operation staff. The cost of revenue increased by
Gross profit and gross margin
Our gross profit increased by
Selling and marketing expenses
Our selling and marketing expenses primarily consist of payroll costs and office related expenses. Selling and marketing expenses increased by
General and administrative expenses
Our general and administrative expenses mainly consist of salaries and bonus, as well as office related expenses. General and administrative expenses increased by
Research and development expenses
Our research and development(“R&D”) expenses mainly consist of salaries and benefits of our R&D staff for the development of Bidding Compass, our online ads bidding analysis software. R&D expenses increased by
Income taxes
We had income taxes of
Net (loss)/income
As a result of the foregoing, we had net income of
Cash and equivalents
As of the fiscal year ended June 30, 2024, HAO had
About Haoxi Health Technology Limited
Haoxi Health Technology Limited is an online marketing solution provider headquartered in Beijing, China, specializing in serving healthcare industry advertiser clients. The Company’s growth is driven by the rise of news feed ads and the rapid development of the healthcare sector. The Company offers one-stop online marketing solutions, especially in online short video marketing, helping advertisers acquire and retain customers on popular platforms in China, such as Toutiao, Douyin, WeChat, and Sina Weibo. The Company is dedicated to reducing costs, increasing efficiency, and providing easy online marketing solutions to advertisers. For more information, please visit: http://ir.haoximedia.com.
Forward-Looking Statement
This press release contains forward-looking statements. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. When the Company uses words such as “may,” “will,” “intend,” “should,” “believe,” “expect,” “anticipate,” “project,” “estimate” or similar expressions that do not relate solely to historical matters, it is making forward-looking statements. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that may cause the actual results to differ materially from the Company’s expectations discussed in the forward-looking statements. These statements are subject to uncertainties and risks including, but not limited to, the uncertainties related to market conditions, and other factors discussed in the “Risk Factors” section of the registration statement filed with the U. S. Securities and Exchange Commission (the “SEC”). For these reasons, among others, investors are cautioned not to place undue reliance upon any forward-looking statements in this press release. Additional factors are discussed in the Company’s filings with the SEC, which are available for review at www.sec.gov. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.
For more information, please contact:
Investor Relations
WFS Investor Relations Inc.
Janice Wang, Managing Partner
Email: services@wealthfsllc.com
Phone: +86 13811768599
+1 628 283 9214
HAOXI HEALTH TECHNOLOGY LIMITED
CONSOLIDATED BALANCE SHEETS
| As of June 30, | ||||||||
| 2024 | 2023 | |||||||
| ASSETS | ||||||||
| Current Assets | ||||||||
| Cash and cash equivalents | $ | 6,655,734 | $ | 1,203,203 | ||||
| Trade receivables, net | 226,747 | 7,748 | ||||||
| Advances to suppliers | 5,174,302 | 2,404,680 | ||||||
| Prepaid expense, receivables and other assets | 3,323,047 | 58,474 | ||||||
| Total current assets | 15,379,830 | 3,674,105 | ||||||
| Non-current assets | ||||||||
| Property and equipment, net | 126,743 | 143,836 | ||||||
| Operating right-of-use asset | — | 89,544 | ||||||
| Deferred listing costs | — | 556,752 | ||||||
| Total non-current assets | 126,743 | 790,132 | ||||||
| Total Assets | $ | 15,506,573 | $ | 4,464,237 | ||||
| LIABILITIES AND EQUITY | ||||||||
| Current Liabilities | ||||||||
| Short-term loans | $ | 833,521 | $ | 511,409 | ||||
| Accounts payable | 653,694 | 27,312 | ||||||
| Advance from customers | 1,185,130 | 1,493,947 | ||||||
| Due to a related party | 6,187 | 20,210 | ||||||
| Taxes payable | 1,044,532 | 328,093 | ||||||
| Accrued expenses and other liabilities | 102,436 | 41,517 | ||||||
| Salary and welfare payable | 41,075 | 37,145 | ||||||
| Operating right-of-use liabilities-current | — | 89,544 | ||||||
| Long-term accounts payable-current | — | 27,344 | ||||||
| Total current liabilities | 3,866,575 | 2,576,521 | ||||||
| Non-current Liabilities | ||||||||
| Long-term accounts payable | 66,365 | 72,104 | ||||||
| Long-term borrowing | 301,678 | 249,107 | ||||||
| Total non-current liabilities | 368,043 | 321,211 | ||||||
| Total Liabilities | 4,234,618 | 2,897,732 | ||||||
| Commitments and contingencies | ||||||||
| SHAREHOLDERS’ EQUITY: | ||||||||
| Class A Ordinary Shares (Par value US | 1,497 | 1,221 | ||||||
| Class B Ordinary Shares (Par value US | 1,727 | 1,727 | ||||||
| Additional paid-in capital | 10,589,916 | 2,176,796 | ||||||
| Retained earnings (Accumulated deficit) | 723,207 | (568,460 | ) | |||||
| Accumulated other comprehensive loss | (44,392 | ) | (44,779 | ) | ||||
| Total shareholders’ equity | 11,271,955 | 1,566,505 | ||||||
| Total liabilities and shareholders’ equity | $ | 15,506,573 | $ | 4,464,237 | ||||
HAOXI HEALTH TECHNOLOGY LIMITED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
| Years Ended June 30, | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| Revenues | $ | 48,519,836 | $ | 28,229,149 | $ | 16,156,865 | ||||||
| Cost of revenues | 45,769,459 | 26,167,083 | 15,508,144 | |||||||||
| Gross profit | 2,750,377 | 2,062,066 | 648,721 | |||||||||
| Operating expenses: | ||||||||||||
| Selling | 41,613 | 32,133 | 37,488 | |||||||||
| General and administrative | 911,531 | 775,961 | 239,941 | |||||||||
| R&D | 79,985 | 58,161 | 102,524 | |||||||||
| Total operating expenses | 1,033,129 | 866,255 | 379,953 | |||||||||
| Income from operations | 1,717,248 | 1,195,811 | 268,768 | |||||||||
| Other income (loss): | ||||||||||||
| Interest expense | (41,186 | ) | (20,902 | ) | (9,961 | ) | ||||||
| Interest income | 76,096 | — | ||||||||||
| Other income (expense) | (16,909 | ) | 15,496 | 788 | ||||||||
| Total other income (loss), net | 18,001 | (5,406 | ) | (9,173 | ) | |||||||
| Income before income taxes | 1,735,249 | 1,190,405 | 259,595 | |||||||||
| Income tax expense | (443,582 | ) | (220,653 | ) | (15,008 | ) | ||||||
| Net income | $ | 1,291,667 | $ | 969,752 | $ | 244,587 | ||||||
| Comprehensive income | ||||||||||||
| Net income | $ | 1,291,667 | $ | 969,752 | $ | 244,587 | ||||||
| Foreign currency translation gain | 387 | 68,180 | 63,037 | |||||||||
| Total Comprehensive income | $ | 1,292,054 | $ | 1,037,932 | $ | 307,624 | ||||||
| Earnings per ordinary share* | ||||||||||||
| – Basic and diluted | $ | 0.04 | $ | 0.04 | $ | 0.010 | ||||||
| Weighted average number of ordinary shares outstanding | ||||||||||||
| – Basic and diluted | 30,600,000 | 27,613,333 | 25,000,000 | |||||||||
HAOXI HEALTH TECHNOLOGY LIMITED
CONSOLIDATED STATEMENTS OF CASH FLOWS
| Years Ended June 30, | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| Cash flows from operating activities | ||||||||||||
| Net income | $ | 1,291,667 | $ | 969,752 | $ | 244,587 | ||||||
| Adjustments to reconcile net income to net cash used in operating activities: | ||||||||||||
| Depreciation | 10,567 | 8,393 | 2,212 | |||||||||
| Changes in operating assets and liabilities: | ||||||||||||
| Accounts receivable | (217,900 | ) | (4,279 | ) | 665,618 | |||||||
| Advances to suppliers | (2,723,828 | ) | (2,473,178 | ) | 439,423 | |||||||
| Prepayments, receivables and other assets | (175,298 | ) | 51,862 | 8,088 | ||||||||
| Accounts payable | 623,168 | (1,201,034 | ) | (1,604,129 | ) | |||||||
| Advance from customers | (328,077 | ) | 1,393,774 | (369,220 | ) | |||||||
| Accrued expenses and other liabilities | 60,069 | 14,406 | (31,572 | ) | ||||||||
| Taxes payable | 708,658 | 330,316 | (29,025 | ) | ||||||||
| Operating lease right-of-use assets | (90,377 | ) | (7,618 | ) | 90,409 | |||||||
| Operating lease liabilities | 90,377 | 29,402 | (87,689 | ) | ||||||||
| Salary and welfare payable | 3,398 | 16,072 | (4,063 | ) | ||||||||
| Net cash used in operating activities | (747,576 | ) | (872,132 | ) | (675,361 | ) | ||||||
| Cash flows from investing activities | ||||||||||||
| Purchase of property and equipment | (55,367 | ) | (45,500 | ) | (8,698 | ) | ||||||
| Loans to third parties | (3,073,684 | ) | — | |||||||||
| Net cash used in investing activities | (3,129,051 | ) | (45,500 | ) | (8,698 | ) | ||||||
| Cash flows from financing activities | ||||||||||||
| Proceeds from short-term borrowings | 478,404 | 453,123 | 329,869 | |||||||||
| Repayment of short-term borrowings | (115,934 | ) | (345,604 | ) | (52,062 | ) | ||||||
| (Repayment of) due to a related party | (14,329 | ) | 21,038 | (811,260 | ) | |||||||
| Payment received from related party | 1,302,752 | |||||||||||
| Proceeds from IPO (a shareholder) | 8,975,416 | 1,994,258 | 163,920 | |||||||||
| Proceeds from long-term borrowings | — | 259,311 | ||||||||||
| Deferred listing costs | — | (579,558 | ) | |||||||||
| Net cash provided by financing activities | 9,323,557 | 1,802,568 | 933,219 | |||||||||
| Effect of foreign exchange rate on cash and restricted cash | 5,601 | 24,756 | (11,534 | ) | ||||||||
| Net increase in cash | 5,452,531 | 909,692 | 237,626 | |||||||||
| Cash at the beginning of the year | 1,203,203 | 293,511 | 55,886 | |||||||||
| Cash at the end of the year | $ | 6,655,734 | $ | 1,203,203 | $ | 293,511 | ||||||
| Supplemental disclosures of cash flow information: | ||||||||||||
| Income taxes paid | $ | 27,570 | $ | — | $ | 7,388 | ||||||
| Interest paid | $ | 37,265 | $ | 19,775 | $ | 206 | ||||||
| Operating right-of-use asset | — | $ | 89,544 | $ | 88,528 | |||||||
FAQ
What was HAO's revenue growth in fiscal year 2024?
How much did HAO's net income increase in fiscal year 2024?
What was HAO's cash position as of June 30, 2024?
How many clients did HAO serve in fiscal year 2024?
