Zepp Health Corporation Reports First Quarter of 2026 Unaudited Financial Results
Rhea-AI Summary
Zepp Health (NYSE:ZEPP) reported unaudited Q1 2026 revenue of US$51.5 million, up 33.8% year-over-year, with gross margin of 37.7% versus 37.3% a year earlier. Adjusted operating loss narrowed to US$16.3 million, and adjusted net loss was US$17.9 million.
Cash and restricted cash totaled US$103.2 million, while inventory fell to US$62.8 million despite strategic component purchases. The company launched new Amazfit Balance 3/Ultra, Bip Max, and Cheetah 2 models and extended its HYROX collaboration into an exclusive three-year global partnership. Q2 2026 revenue guidance is US$63.0–68.0 million, implying approximately 6%–14% year-over-year growth.
Positive
- Revenue US$51.5 million, up 33.8% year-over-year
- Gross margin 37.7%, up from 37.3% in Q1 2025
- Adjusted operating loss narrowed to US$16.3 million from US$17.2 million
- Cash and restricted cash at quarter-end of US$103.2 million
- Inventory reduced to US$62.8 million despite strategic component purchases
- Exclusive three-year global HYROX partnership expanding wearable and training ecosystem
- Q2 2026 revenue guidance of US$63–68 million, up ~6%–14% year-over-year
Negative
- GAAP operating loss of US$17.7 million in Q1 2026
- GAAP net loss of US$19.6 million and adjusted net loss of US$17.9 million
- GAAP operating expenses rose to US$37.1 million from US$32.7 million
- Foreign currency headwinds added about US$1.8 million to operating expenses
- Gross margin down from 40.4% in Q4 2025 to 37.7%
- Cash balance declined by US$9.7 million versus December 31, 2025
- Higher R&D, marketing, and G&A spending increased cost base
News Market Reaction – ZEPP
In the Jun 9 session, ZEPP declined 28.64%, reflecting a significant negative market reaction. Argus tracked a trough of -34.9% from its starting point during tracking. Our momentum scanner triggered 51 alerts that day, indicating high trading interest and price volatility. Trading volume was elevated at 2.3x the daily average, suggesting increased selling activity.
Data tracked by StockTitan Argus on the day of publication.
Key Figures
Previous Earnings Reports
| Date | Event | Sentiment | 24h Move | Catalyst |
|---|---|---|---|---|
| Mar 15 | Q4 2025 earnings | Positive | -17.9% | Strong Q4 and FY 2025 revenue growth with record 40.4% gross margin. |
| Nov 04 | Q3 2025 earnings | Positive | -6.0% | Q3 2025 revenue up 78.5% YoY and adjusted operating breakeven. |
| Aug 03 | Q2 2025 earnings | Positive | +34.0% | Q2 2025 revenue grew 46.2% YoY with narrower GAAP and adjusted losses. |
| May 19 | Q1 2025 earnings | Neutral | -6.3% | Q1 2025 showed modest growth and margin gains but maintained net loss. |
| Mar 26 | Q4 2024 earnings | Positive | +15.3% | Q4 2024 margins improved and cash remained strong despite lower revenue. |
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
Earnings releases have often been followed by volatile and sometimes negative reactions, even when revenue and margins improved.
Over the last five earnings cycles, Zepp reported consistent year-over-year revenue growth and gradually improving gross margins, including Q4 2025 revenue of US$85.2M with record 40.4% gross margin and full-year 2025 revenue of US$258.9M. Earlier quarters in 2025 showed narrowing net and operating losses as scale improved. Market reactions have been mixed, with some strong rallies (e.g., Q2 2025 at +34%) but also sharp selloffs such as Q4 2025 at -17.95%, highlighting an uneven response to fundamentally improving results.
Key Terms
gaap financial
adjusted operating income/(loss) financial
amortization of intangible assets financial
non-gaap financial
AI-generated analysis. How Rhea-AI works. Not financial advice.
First Quarter of 2026 Financial and Operating Highlights:
- Revenue reached
US , representing$51.5 million 33.8% year-over-year growth, in line with our guidance range. - Gross margin was
37.7% , an expansion of 0.4 percentage points compared with the first quarter of 2025. We typically refresh entry-level product lines in the first quarter; these offerings carry lower gross profitability. In addition, elevated memory component costs pressured the gross margin performance. - As of March 31, 2026, cash and cash equivalents and restricted cash were
US , nearly flat compared with$103.2 million US as of March 31, 2025. The cash balance decreased by$103.8 million US compared with$9.7 million US as of December 31, 2025, primarily driven by net operating losses and seasonality, as the first quarter is traditionally a low season for consumer electronics business.$112.9 million - Despite strategic risk purchases of key components for the future, our inventory balance decreased to
US compared with$62.8 million US as of December 31, 2025. This reflects ongoing improvements in inventory management.$72.8 million - For the second quarter of 2026, management currently expects net revenues to be between
US and$63.0 million US , which would represent a year-over-year increase of approximately$68.0 million 6% to14% . This outlook reflects continued year-over-year growth, supported by demand across our product portfolio, while also accounting for normal shipment timing and product launch phasing during the quarter. More importantly, we will continue to focus on the quality of growth-product mix, pricing power, gross margin structure, and user engagement. - New products debut:
- Amazfit Balance 3 and Balance Ultra: These products are designed for users who balance strength, endurance, recovery, work, stress, and daily life. Powered by HybridCharge™ Energy Intelligence in the Zepp App, they bring together BioCharge, LifeLoad, and Training Load into one clear view of personal capacity, helping users better understand when to push, when to recover, and how to maintain consistency over the long term.
- Amazfit Bip Max: Our new entry-level, all-around sports watch designed for users who want a large display, long battery life, comprehensive features, and accurate tracking data.
- Amazfit Cheetah 2 Pro: Engineered for marathon runners who train with discipline and recover with purpose, building strength alongside endurance and following a structure that develops the body over time.
- Amazfit Cheetah 2 Ultra: Built for trail runners facing prolonged exposure in unpredictable terrain, where distance is sustained through endurance and load is carried through structure.
- Extension for HYROX partnership: In April 2026, we further deepened our collaboration with HYROX through a new exclusive three-year global partnership, securing our position as its exclusive wearable technology partner. This landmark deal expands our prior regional cooperation to a full global footprint, marking a substantial upgrade in the depth and reach of our alliance.
- Further expansion of our Amazfit Athletes team: Welcome Rory Linkletter, an Olympian and one of
Canada's top distance runners, holding the national record in the half marathon, to our growing athletes' family.
Mr. Wang "Wayne" Huang, Founder, Chairman and CEO of Zepp Health, commented, "We began 2026 with another quarter in line with our guidance, as Amazfit-branded revenue grew
Our ambition for 2026 is to build a leadership position in Hybrid Training. This quarter, we extended that strategy across running and hybrid training with the launch of the Cheetah 2 lineup and, most recently, Balance 3 and Balance Ultra, products designed to support users across endurance, strength, recovery, and daily life.
Growth was broad-based across both premium and entry tiers, from T-Rex Ultra 2 to Active and Bip products.
In March and April, our premium T-Rex models such as T-Rex Pro and T-Rex Ultra accounted for nearly
Beyond hardware, we continued strengthening our ecosystem through Zepp OS, with Zepp Coach, HybridCharge, and our growing library of Hybrid Training and HYROX modes deepening engagement and retention.
Our ecosystem strategy is designed to meet users at the moment they move from casual tracking to more serious training, when training value begins to matter more than the phone ecosystem alone. We further deepened our collaboration with HYROX through a new exclusive three-year global partnership, expanding our role across smart wearables, connected app experiences, HYROX-specific training modes, and selected performance data integrations.
Importantly, HYROX gives us access not only to race participants, but also to a global network of gyms, coaches, and highly engaged training communities.
We are entering the next phase of growth with stronger product mix, clearer brand positioning, and a continued focus on long-term shareholder value."
Mr. Leon Deng, Zepp's Chief Financial Officer, added, "We delivered a strong start to 2026, with first-quarter revenue increasing
Our gross margin for the first quarter was
We remain disciplined in managing operating expenses while continuing to invest in the areas that support long-term competitiveness, including R&D, marketing, branding, and AI-enabled product innovation. Although foreign-exchange translation and growth-related channel costs impacted expenses in the quarter, our adjusted operating loss narrowed year over year, and adjusted net loss as a percentage of sales improved, reflecting better operating leverage as revenue scales. Thanks to higher revenue and improved gross margins, our adjusted operating loss[1] narrowed to
As of March 31, 2026, we ended the quarter with
For the second quarter of 2026, we expect revenue in the range of
[1] Adjusted operating income/(loss) represents operating income/(loss) excluding: (i) share-based compensation expenses and (ii) amortization of intangible assets resulting from acquisitions and business cooperation agreements. See "Reconciliation of GAAP and non-GAAP results" at the end of this press release. |
First Quarter of 2026 Financial Results
Revenues
Revenues for the first quarter of 2026 reached
Gross Margin
Gross margin in the first quarter of 2026 was
Research and Development Expenses
Research and development expenses in the first quarter of 2026 were
Selling and Marketing Expenses
Selling and marketing expenses in the first quarter of 2026 were
Selling and marketing expenses increased by
General and Administrative Expenses
General and administrative expenses were
Operating Expenses
GAAP and adjusted operating expenses[2] for the first quarter of 2026 were
GAAP and adjusted operating expenses in the fourth quarter of 2025 were
[2] Adjusted operating expenses represent operating expenses excluding (i) share-based compensation expenses and (ii) amortization of intangible assets resulting from acquisitions and business cooperation agreements. Please refer to the section titled "Reconciliation of GAAP and non-GAAP results" at the end of this press release. |
Operating Income/(Loss)
GAAP and adjusted operating results were loss of
Net Income/(Loss)
GAAP and adjusted net loss[3] attributable to Zepp Health Corporation for the first quarter of 2026 was
[3] Adjusted net income/(loss) attributable to Zepp Health Corporation represents net income/(loss) excluding (i) share-based compensation expenses, (ii) amortization of intangible assets resulting from acquisitions and business cooperation agreements, (iii) gain/(loss) from fair value change of long-term investment, (iv) impairment loss from long-term investments, (v) income/(loss) from equity method investments, and (vi) tax effects of the above non-GAAP adjustments. See "Reconciliation of GAAP and non-GAAP results" at the end of this press release. |
Liquidity and Capital Resources
As of March 31, 2026, the Company had cash balance (including restricted cash) totaling
The Company recorded inventory of
Long-term and short-term debt levels increased by
Share Repurchase Program Update
The Company announced in its third quarter 2021 earnings release that the board had authorized a share repurchase program of up to
Outlook
For the second quarter of 2026, the Company's management currently expects net revenues to be between
This outlook is based on current market conditions and reflects the Company's current and preliminary estimates of market, operating conditions and customer demand, which are all subject to change.
Conference Call
The Company's management team will hold a conference call at 9:30 p.m. Eastern Time on Monday, June 8, 2026 to discuss financial results and answer questions from investors and analysts. Listeners may access the call by dialing:
US (Toll Free): | +1-888-346-8982 |
International: | +1-412-902-4272 |
Mainland | 400-120-1203 |
800-905-945 |
Participants should dial in at least 10 minutes before the scheduled start time and ask to be connected to the call for "Zepp Health Corporation".
Additionally, a live and archived webcast of the conference call will be available at http://ir.zepp.com.
A telephone replay will be available one hour after the call until June 15, 2026 by dialing:
US Toll Free: | +1-855-669-9658 |
International: | +1-412-317-0088 |
Replay Passcode: | 3483283 |
About Zepp Health Corporation
Zepp Health Corporation (NYSE: ZEPP) is a global leader in smart wearables and health technology, empowering users to live their healthiest lives by optimizing their health, fitness, and wellness journeys through its leading consumer brands, Amazfit, Zepp Clarity, and Zepp Aura. Powered by its proprietary Zepp Digital Management Platform, which includes Zepp OS, AI chips, biometric sensors, and data algorithms, Zepp delivers cloud-based 24/7 actionable insights and guidance to help users attain their wellness goals. To date, Zepp has shipped over 200 million units and served more than 53 million users, and its products are available in more than 150 countries and regions. Zepp Health has team members and offices across the globe, especially in Europe and the United States.
Use of Non-GAAP Measures
We use adjusted net income/(loss), a non-GAAP financial measure, in evaluating our operating results and for financial and operational decision-making purposes. Adjusted operating expenses represent operating expenses excluding (i) share-based compensation expenses and (ii) amortization of intangible assets resulting from acquisitions and business cooperation agreements. Adjusted operating income/(loss) represents operating income/(loss) excluding: (i) share-based compensation expenses and (ii) amortization of intangible assets resulting from acquisitions and business cooperation agreements. Adjusted EBIT represents net income/(loss) excluding (i) share-based compensation expenses, (ii) amortization of intangible assets resulting from acquisitions and business cooperation agreements, (iii) gain/(loss) from fair value change of long-term investments, (iv) impairment loss from long-term investments, (v) income/(loss) from equity method investments, (vi) income tax (benefit)/expense, and (vii) interest income and interest expense. Adjusted net income/(loss) attributable to Zepp Health Corporation is a non-GAAP measure, which excludes (i) share-based compensation expenses, (ii) amortization of intangible assets resulting from acquisitions and business cooperation agreements, (iii) gain/(loss) from fair value change of long-term investments, (iv) impairment loss from long-term investments, (v) income/(loss) from equity method investments, and (vi) tax effects of the above non-GAAP adjustments, and is used as the numerator in computation of adjusted net income/(loss) per share and per ADS attributable to Zepp Health Corporation.
We believe that adjusted EBIT and adjusted net income/(loss) attributable to Zepp Health Corporation help identify underlying trends in our business that could otherwise be distorted by the effect of certain expenses that we include in net income/(loss) and net income/(loss) attributable to Zepp Health Corporation. We believe adjusted EBIT and adjusted net income/(loss) attributable to Zepp Health Corporation provides useful information about our operating results, enhances the overall understanding of our past performance and future prospects and allows for greater visibility with respect to key metrics used by our management in its financial and operational decision-making.
Adjusted EBIT and adjusted net income/(loss) attributable to Zepp Health Corporation, should not be considered in isolation or construed as an alternative to net income/(loss), basic and diluted net income/(loss) per share and per ADS attributable to Zepp Health Corporation or any other measure of performance or as an indicator of our operating performance. Investors are encouraged to review the historical non-GAAP financial measures to the most directly comparable GAAP measures. Adjusted EBIT and adjusted net income/(loss) attributable to ordinary shareholders, presented here may not be comparable to similarly titled measures presented by other companies. Other companies may calculate similarly titled measures differently, limiting their usefulness as comparative measures to our data. We encourage investors and others to review our financial information in its entirety and not rely on a single financial measure.
Safe Harbor Statement
This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of 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," "confident" and similar statements. Statements that are not historical facts, including statements about the Company's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the recognition of the Company's Amazfit-branded products; the Company's growth strategies; trends and competition in global wearable technology market; changes in the Company's revenues and certain cost or expense accounting policies; governmental policies relating to the Company's industry and general economic conditions around the globe. Further information regarding these and other risks is included in the Company's filings with the United States Securities and Exchange Commission. All information provided in this press release and in the attachments is as of the date of this press release, and the Company undertakes no obligation to update any forward-looking statement, except as required under applicable law.
For investor and media inquiries, please contact:
In China:
Zepp Health Corporation
Grace Yujia Zhang
Email: ir@zepp.com
Piacente Financial Communications
Tel: +86-10-6508-0677
Email: zepp@tpg-ir.com
Zepp Health Corporation | ||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | ||||
(Amounts in thousands of | ||||
except for number of shares and per share data, or otherwise noted) | ||||
As of December 31, | As of March 31, | |||
2025 | 2026 | |||
US$ | US$ | |||
Assets | ||||
Current assets: | ||||
Cash and cash equivalents | 57,046 | 52,399 | ||
Restricted cash | 55,887 | 50,752 | ||
Accounts receivable, net | 66,908 | 56,240 | ||
Amounts due from related parties | 6,665 | 6,161 | ||
Inventories, net | 72,756 | 62,839 | ||
Prepaid expenses and other current assets | 34,263 | 30,870 | ||
Total current assets | 293,525 | 259,261 | ||
Property, plant and equipment, net | 5,662 | 5,544 | ||
Intangible asset, net | 13,611 | 13,205 | ||
Goodwill | 9,581 | 9,581 | ||
Long-term investments | 220,047 | 222,306 | ||
Deferred tax assets | 15,743 | 15,804 | ||
Amount due from related parties, non-current | 991 | 997 | ||
Other non-current assets | 3,718 | 3,528 | ||
Operating lease right-of-use assets | 1,958 | 2,369 | ||
Total assets | 564,836 | 532,595 | ||
Zepp Health Corporation | ||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS - CONTINUED | ||||
(Amounts in thousands of | ||||
except for number of shares and per share data, or otherwise noted) | ||||
As of December 31, | As of March 31, | |||
2025 | 2026 | |||
US$ | US$ | |||
Liabilities | ||||
Current liabilities: | ||||
Accounts payable | 80,768 | 59,239 | ||
Advance from customers | 76 | 43 | ||
Amounts due to related parties | 654 | 585 | ||
Accrued expenses and other current liabilities | 37,527 | 35,950 | ||
Income tax payables | 366 | 355 | ||
Notes payable | 111,725 | 111,112 | ||
Short-term bank borrowings | 55,728 | 86,977 | ||
Total current liabilities | 286,844 | 294,261 | ||
Deferred tax liabilities | 2,673 | 2,710 | ||
Long-term borrowings | 59,475 | 40,043 | ||
Other non-current liabilities | 209 | 106 | ||
Non-current operating lease liabilities | 1,102 | 1,307 | ||
Total liabilities | 350,303 | 338,427 | ||
Zepp Health Corporation | ||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS - CONTINUED | ||||
(Amounts in thousands of | ||||
except for number of shares and per share data, or otherwise noted) | ||||
As of December 31, | As of March 31, | |||
2025 | 2026 | |||
US$ | US$ | |||
Equity | ||||
Ordinary shares | 26 | 26 | ||
Additional paid-in capital | 280,676 | 281,611 | ||
Treasury stock | (16,153) | (16,951) | ||
Accumulated retained earnings/(loss) | (11,450) | (31,093) | ||
Accumulated other comprehensive loss | (38,566) | (39,425) | ||
Total equity | 214,533 | 194,168 | ||
Total liabilities and equity | 564,836 | 532,595 | ||
Zepp Health Corporation | |||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||
(Amounts in thousands of | |||||
except for number of shares and per share data, or otherwise noted) | |||||
For the Three Months Ended March 31, | |||||
2025 | 2026 | ||||
US$ | US$ | ||||
Revenues | 38,537 | 51,547 | |||
Cost of revenues | (24,176) | (32,110) | |||
Gross profit | 14,361 | 19,437 | |||
Operating expenses: | |||||
Selling and marketing | (13,841) | (16,640) | |||
General and administrative | (6,518) | (7,355) | |||
Research and development | (12,377) | (13,134) | |||
Total operating expenses | (32,736) | (37,129) | |||
Operating loss | (18,375) | (17,692) | |||
Other income and expenses: | |||||
Interest income | 581 | 331 | |||
Interest expense | (1,358) | (1,654) | |||
(Loss)/Gain from fair value change of long-term investments | (125) | 77 | |||
Other income/(expense), net | 4 | (52) | |||
Loss before income tax and loss from equity method investments | (19,273) | (18,990) | |||
Income tax expenses | (110) | (214) | |||
Loss before loss from equity method investments | (19,383) | (19,204) | |||
Net loss from equity method investments | (358) | (439) | |||
Net loss attributable to Zepp Health Corporation | (19,741) | (19,643) | |||
Basic and diluted net loss per share attributable to Zepp Health | (0.08) | (0.08) | |||
Basic and diluted net loss per ADS (16 ordinary shares equal to 1 | (1.23) | (1.24) | |||
Weighted average number of shares used in computing basic and | 256,410,171 | 253,929,090 | |||
Zepp Health Corporation | |||||
Reconciliation of GAAP and Non-GAAP Results | |||||
(Amounts in thousands of | |||||
except for number of shares and per share data, or otherwise noted) | |||||
For the Three Months Ended March 31, | |||||
2025 | 2026 | ||||
US$ | US$ | ||||
Total operating expenses | (32,736) | (37,129) | |||
Share-based compensation expenses | 589 | 935 | |||
Amortization of intangible assets resulting from acquisitions | 635 | 490 | |||
Total adjusted operating expenses | (31,512) | (35,704) | |||
Operating loss | (18,375) | (17,692) | |||
Share-based compensation expenses | 589 | 935 | |||
Amortization of intangible assets resulting from acquisitions | 635 | 490 | |||
Adjusted operating loss | (17,151) | (16,267) | |||
Net loss | (19,741) | (19,643) | |||
Share-based compensation expenses | 589 | 935 | |||
Amortization of intangible assets resulting from acquisitions | 635 | 490 | |||
Interest income | (581) | (331) | |||
Interest expense | 1,358 | 1,654 | |||
Loss/(Gain) from fair value change of long-term investments | 125 | (77) | |||
Income tax expenses | 110 | 214 | |||
Loss from equity method investments | 358 | 439 | |||
Adjusted EBIT[4] | (17,147) | (16,319) | |||
Net loss attributable to Zepp Health Corporation | (19,741) | (19,643) | |||
Share-based compensation expenses | 589 | 935 | |||
Amortization of intangible assets resulting from acquisitions | 635 | 490 | |||
Gain/(Loss) from fair value change of long-term investments | 125 | (77) | |||
Tax effects on non-GAAP adjustments | (103) | (83) | |||
Loss from equity method investments | 358 | 439 | |||
Adjusted net loss attributable to Zepp Health Corporation | (18,137) | (17,939) | |||
Adjusted basic and diluted net loss per share attributable | (0.07) | (0.07) | |||
Adjusted basic and diluted net loss per ADS (16 ordinary | (1.13) | (1.13) | |||
Weighted average number of shares used in computing | 256,410,171 | 253,929,090 | |||
Share-based compensation expenses included are as | |||||
Selling and marketing | 42 | 196 | |||
General and administrative | 286 | - | |||
Research and development | 261 | 739 | |||
Total | 589 | 935 | |||
[4] Adjusted EBIT is a non-GAAP financial measure, which is defined as net loss, excluding (i) share-based compensation | |||||
[5] Adjusted diluted net income/(loss) is the abbreviation of adjusted net (loss)/income attributable to Zepp Health Corporation, resulting from acquisitions and business cooperation agreements, (iii) gain/(loss) from fair value change of long-term investments, | |||||
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SOURCE Zepp Health Corp.