WeTouch Announces First Quarter Fiscal Year 2024 Financial Results with Cash Reserves of $94.8 Million

Rhea-AI Summary

WeTouch Technology (NASDAQ: WETH) reported its first-quarter fiscal year 2024 results, showing a revenue increase of 11.2% to $14.9 million compared to $13.4 million in 1Q 2023. Overseas market revenue rose by 34.1% to $5.5 million. Cash reserves remained robust at $94.8 million. Total shipment volume increased by 7.3% to 681,370 units. Despite the revenue growth, net income dropped to $0.6 million, or $0.04 per diluted share, from $2.8 million, or $0.35 per diluted share, due to higher sales costs and increased shares outstanding. Gross margin decreased significantly to $3.3 million, or 22.4% of sales, down from $6.0 million, or 45.0% of sales. However, operating expenses reduced by 41.1% to $1.0 million. Shareholders' equity grew to $120.5 million.

Positive

• Revenue rose by 11.2% to $14.9 million compared to $13.4 million in 1Q 2023.
• Overseas market revenue increased by 34.1% to $5.5 million.
• Total shipment volume grew by 7.3% to 681,370 units.
• Cash reserves remained high at $94.8 million.
• Operating expenses decreased by 41.1% to $1.0 million.
• Shareholders' equity increased to $120.5 million.

Negative

• Net income decreased to $0.6 million, or $0.04 per diluted share, from $2.8 million, or $0.35 per diluted share.
• Gross margin fell by 45.0% to $3.3 million, or 22.4% of sales, from $6.0 million, or 45.0% of sales.
• The decline in net income was attributed to higher sales costs and increased shares outstanding.

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First Quarter Fiscal Year 2024 Revenue Reaches $14.9 Million, Marking an 11.2% Increase from 1Q 2023

CHENGDU, China, June 17, 2024 /PRNewswire/ -- WeTouch Technology Inc., (NASDAQ: WETH) ("WeTouch" or the "Company"), a leading innovator in the global touch display industry, today announced its financial results for the first quarter ended March 31, 2024.

"We achieved higher revenue in the first quarter of fiscal 2024 by aggressively promoting our high-end products. Although our cost of goods sold increased due to the export controls imposed by the U.S. Department of Commerce on advanced computing and semiconductor manufacturing to China, we expect the procurement costs of chips and other raw materials to stabilize after the second quarter of 2024 as our suppliers increase production volumes. We believe that the market demand for products with better materials and quality remains strong both in China and overseas, creating many exciting opportunities for WeTouch's long-term growth," concluded WeTouch Technology's CEO, Zongyi Lian.

First Half Fiscal Year 2024 Financial Highlights

- Cash Reserves: The company's cash reserves remain high at $94.8 million this quarter.

- Total Revenue: Increased 11.2% to $14.9 million compared to $13.4 million for the first quarter of fiscal 2023. This growth is primarily related to an increase in sales volume in both China and international markets and higher average selling prices for new higher-end products.

- Overseas Market Revenue: Reached $5.5 million, an increase of $1.4 million, or 34.1%. This was driven by a 12.9% increase in sales volume and an 18.1% increase in average selling price for industrial control computer touchscreens, automotive touchscreens, and gaming touchscreens.

- Total Volume Shipped: Increased 7.3% to 681,370 units from 635,276 units in the first quarter of 2023.

- Net Income: Decreased to $0.6 million, or $0.04 per diluted share, compared to $2.8 million, or $0.35 per diluted share, for the first quarter of fiscal 2023. The decrease is attributed to a temporary increase in sales costs and a higher number of shares outstanding.

- Gross Margin: Decreased 45.0% to $3.3 million, or 22.4% of sales, compared to $6.0 million, or 45.0% of sales, in the same quarter last year. The decline is due to a seasonal short-term increased labor and material costs.

- Operating Expenses: Decreased 41.1% to $1.0 million, or 6.9% of sales, compared to $1.7 million, or 12.9% of sales, for the same quarter last year, largely due to reduced professional fees.

- Shareholders' Equity: Increased to $120.5 million from $112.9 million as of December 31, 2023.There were approximately 11,931,534 and 9,732,948 common shares outstanding at March 31, 2024 and December 31, 2023, respectively.

About WeTouch Technology Inc.

Wetouch Technology Inc. is at the forefront of providing premium touch display solutions, dedicated to reshaping human-machine interaction across diverse industries. With a relentless focus on innovation and customer satisfaction, Wetouch consistently delivers cutting-edge technology and unparalleled performance in touch display solutions globally.

For additional information, please visit: WeTouch Technology Inc.at http://en.usa-wetouch.com/

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will", "expects", "anticipates", "future", "intends", "plans", "believes", "estimates", "target", "going forward", "outlook," "objective" and similar terms. Such statements are based upon management's current expectations and current market and operating conditions, and relate to events that involve known or unknown risks, uncertainties and other factors, all of which are difficult to predict and which are beyond Datasea's control, which may cause Datasea's actual results, performance or achievements (including the RMB/USD value of its anticipated benefit to Datasea as described herein) to differ materially and in an adverse manner from anticipated results contained or implied in the forward-looking statements. Further information regarding these and other risks, uncertainties or factors is included in Datasea's filings with the U.S. Securities and Exchange Commission, which are available at www.sec.gov. Datasea does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under law.

Investor and Media Contact: 

Horizon Research Management Consultancy
Michael Wei,
Email: hwey@horizonconsultancy.co 

View original content:https://www.prnewswire.com/news-releases/wetouch-announces-first-quarter-fiscal-year-2024-financial-results-with-cash-reserves-of-94-8-million-302174207.html

SOURCE Wetouch Technology Inc.

FAQ

What were WeTouch Technology's revenue figures for Q1 2024?

WeTouch Technology's revenue for Q1 2024 was $14.9 million, an 11.2% increase from Q1 2023.

How much did WeTouch Technology earn from overseas markets in Q1 2024?

WeTouch Technology earned $5.5 million from overseas markets in Q1 2024, marking a 34.1% increase.

What was WeTouch Technology's net income in Q1 2024?

WeTouch Technology's net income in Q1 2024 was $0.6 million, or $0.04 per diluted share.

How did WeTouch Technology's gross margin perform in Q1 2024?

WeTouch Technology's gross margin fell to $3.3 million, or 22.4% of sales, in Q1 2024 from $6.0 million, or 45.0% of sales, in Q1 2023.

What were WeTouch Technology's cash reserves in Q1 2024?

WeTouch Technology's cash reserves were $94.8 million in Q1 2024.

How many units did WeTouch Technology ship in Q1 2024?

WeTouch Technology shipped 681,370 units in Q1 2024, a 7.3% increase from the previous year.

What was WeTouch Technology's shareholders' equity as of March 31, 2024?

WeTouch Technology's shareholders' equity was $120.5 million as of March 31, 2024.