Waterdrop Inc. Announces First Quarter 2025 Unaudited Financial Results, Net profit rises 34.2% year-on-year

Rhea-AI Summary

Waterdrop Inc. (NYSE: WDH) reported strong Q1 2025 financial results with net operating revenue of RMB 753.7M and net profit of RMB 108.2M, up 34.2% YoY, marking its 13th consecutive profitable quarter. The insurance segment generated RMB 658.0M in revenue (+8.4% YoY) with operating profit of RMB 151.4M. First-year premiums reached RMB 2,092.4M (+19.3% YoY), while short-term premiums grew 30.1% YoY. The company's AI initiatives showed significant progress, with AI Insurance Expert facilitating over RMB 2M in monthly premiums and AI Service Quality Copilot improving efficiency by 83%. Waterdrop Medical Crowdfunding has helped 3.47M patients raise RMB 68.8B, while the Digital Clinical Trial Solution revenue grew 11.5% YoY to RMB 23.0M. The company continues its share repurchase program, having bought back 54.2M ADSs as of May 31, 2025.

Positive

• Net profit increased 34.2% year-over-year to RMB 108.2M, marking 13th consecutive profitable quarter
• Operating expenses decreased by 6.1 percentage points year-over-year to 40.3% of revenue
• Insurance-related revenue grew 8.4% YoY to RMB 658.0M with first-year premiums up 19.3%
• Short-term premiums increased significantly by 30.1% year-over-year
• AI Service Quality Copilot improved operational efficiency by 83%

Negative

• None.

Insights

Financial Analyst

Waterdrop's Q1 shows strong 34.2% profit growth, improved operational efficiency, and successful AI integration across insurance operations.

Waterdrop's Q1 2025 results reveal a company efficiently executing its growth strategy with impressive bottom-line improvement. The 34.2% year-over-year increase in net profit to RMB 108.2 million marks the thirteenth consecutive profitable quarter, demonstrating sustainable business fundamentals rather than temporary success.

Operational efficiency stands out as a key driver, with operating expenses decreasing to 40.3% of revenue—a reduction of 6.1% year-over-year. This cost discipline is supporting margin expansion even as the company invests in growth initiatives.

The insurance segment shows particularly strong momentum with 8.4% revenue growth to RMB 658.0 million and operating profit of RMB 151.4 million. More impressive is the 19.3% increase in first-year premiums to RMB 2,092.4 million, suggesting effective customer acquisition and product adoption.

Product innovation appears to be paying dividends, especially in short-term premiums which surged 30.1%. The company's AI integration is delivering tangible business impact, with AI insurance applications now generating RMB 2 million in monthly premiums and improving operational efficiency by 83%.

The share repurchase program signals management's confidence in business fundamentals and commitment to shareholder returns. Meanwhile, the company's medical crowdfunding platform continues to demonstrate impressive scale, having raised RMB 68.8 billion for 3.47 million patients—reinforcing Waterdrop's dual focus on profitability and social impact.

BEIJING, June 5, 2025 /PRNewswire/ -- On June 5, 2025, Waterdrop Inc. (NYSE: WDH), a leading technology platform dedicated to insurance and healthcare services with a positive social impact, unveiled its unaudited financial results for the three months ended March 31, 2025. During the quarter, Waterdrop reported net operating revenue of RMB 753.7 million. Net profit attributable to ordinary shareholders totaled RMB 108.2 million, up 34.2% from the previous year, sustaining profitability for the thirteenth consecutive quarter. Operating expenses, including sales, administrative, and R&D expenses, accounted for 40.3% of revenue, a decrease of 6.1 percentage points year-on-year.

Since announcing its first share repurchase program in September 2021, As of May 31, 2025, Waterdrop has repurchased approximately 54.2 million American Depositary Shares (ADSs) from the open market.

Insurance Business Operating Profit Totaled RMB 151.4 Million

Waterdrop's insurance-related revenue amounted to RMB 658.0 million in the first quarter of 2025, representing an increase of 8.4% year-over-year. The insurance business operating profit reached RMB 151.4 million in the first quarter 2025. First-year premiums (FYPs) generated by insurance business amounted to RMB 2,092.4 million, representing an increase of 19.3% year over year.

In line with the annual growth objectives, Waterdrop's insurance business maintained a strong upward trajectory. Waterdrop refined public domain user acquisition strategies and improved services for private domain users, leading to a notable 30.1% year-over-year increase in short-term premiums. Product innovation remains a top priority, as highlighted by the upgrade of "Jiehaoyun", industry-first product, to version 5.0. Furthermore, the company recently introduced a revolutionary Million Medical Insurance product that uniquely offers both a health declaration waiver and guaranteed renewal for five consecutive years.

Waterdrop Guardian AI applications are playing increasingly critical roles in both internal and external use cases. For instance, the penetration of  "AI Insurance Expert - Medical Insurance" has further expanded and facilitated over 2 million yuan in monthly premiums this quarter. Additionally, "AI Service Quality Copilot" has boosted unit operational efficiency by 83% since its launch. Beyond internal initiatives, Waterdrop has partnered with four P&C insurers to pilot AI-driven applications in the auto insurance sector, collaborating to set industry benchmarks.

Waterdrop Medical Crowdfunding cumulatively Raised RMB 68.8 Billion for 3.47 Million Patients

During the quarter, Waterdrop Medical Crowdfunding upheld its mission of "saving lives" with remarkable success. As of March 31, 2025, around 475 million people cumulatively donated an aggregate of RMB 68.8 billion to 3.47 million patients through Waterdrop Medical Crowdfunding.

Waterdrop's Digital Clinical Trial Solution has maintained its growth in the first quarter of 2025, generating revenues of approximately RMB 23.0 million, representing an increase of 11.5% year-over-year. As of March 31, 2025, the Company had cumulatively enrolled 11,217 patients into 1,281 clinical trial programs through the E-Find Platform.

Mr. Peng Shen, Founder, Chairman, and Chief Executive Officer of Waterdrop, commented, "Our business performance in Q1 demonstrates solid revenue and profit growth. AI capabilities now power our core business scenarios and ecosystems, enhancing service quality through technological innovation. Moving forward, we will focus on tech-driven value creation with consistent commitment to 'Tech for Good'. We strive to deliver value to all stakeholders through high-quality growth."

 

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SOURCE Waterdrop Inc.

FAQ

What was Waterdrop's (WDH) net profit growth in Q1 2025?

Waterdrop's net profit grew 34.2% year-over-year to RMB 108.2 million in Q1 2025, marking its 13th consecutive profitable quarter.

How much revenue did Waterdrop's insurance business generate in Q1 2025?

Waterdrop's insurance-related revenue reached RMB 658.0 million in Q1 2025, an 8.4% increase year-over-year, with operating profit of RMB 151.4 million.

What is the total amount raised through Waterdrop Medical Crowdfunding?

As of March 31, 2025, Waterdrop Medical Crowdfunding has helped raise RMB 68.8 billion for 3.47 million patients through donations from approximately 475 million people.

How many ADSs has Waterdrop (WDH) repurchased since September 2021?

As of May 31, 2025, Waterdrop has repurchased approximately 54.2 million American Depositary Shares (ADSs) from the open market.

What was the impact of Waterdrop's AI initiatives in Q1 2025?

Waterdrop's AI Insurance Expert facilitated over RMB 2 million in monthly premiums, while the AI Service Quality Copilot improved unit operational efficiency by 83%.