Zhihu Inc. Reports Unaudited Fourth Quarter and Fiscal Year 2022 Financial Results
Zhihu Inc. (NYSE: ZH) reported its financial results for Q4 and fiscal year 2022, highlighting total revenues of RMB1,114.0 million (US$161.5 million) in Q4, a 9.3% increase year-over-year. The net loss narrowed by 53.2% to RMB179.5 million (US$26.0 million). Average monthly active users reached 100.7 million, while paid membership revenue rose 92.8% to RMB402.5 million (US$58.4 million). The company saw significant growth in its vocational training, with revenue increasing 281.1%. Although advertising revenue dropped, the gross margin improved to 56.4%.
- Total revenues for Q4 2022 were RMB1,114.0 million, up 9.3% YoY.
- Net loss decreased by 53.2% to RMB179.5 million, improving financial health.
- Paid membership revenue surged 92.8% YoY to RMB402.5 million.
- Vocational training revenue increased by 281.1% YoY, highlighting a new growth area.
- Gross margin improved to 56.4% from 47.1% YoY, reflecting enhanced operational efficiency.
- Advertising revenue fell to RMB274.7 million, down from RMB377.8 million YoY, affected by the macroeconomic downturn.
- Total operating expenses increased to RMB844.8 million despite the reduction in net loss, indicating ongoing cost pressures.
Fourth Quarter 2022 Highlights
- Total revenues were
RMB1,114.0 million (US ) in the fourth quarter of 2022, representing a$161.5 million 9.3% increase from the same period of 2021. - Net loss was RMB179.5 million (
US ) in the fourth quarter of 2022, narrowed by$26.0 million 53.2% from the same period in 2021. - Adjusted net loss (non-GAAP)[1] was
RMB134.1 million (US ) in the fourth quarter of 2022, narrowed by$19.4 million 44.3% from the same period of 2021. - Average monthly active users (MAUs)[2] reached 100.7 million in the fourth quarter of 2022, compared with 103.3 million in the same period of 2021.
- Average monthly subscribing members[3] reached 13.0 million in the fourth quarter of 2022, representing a
112.5% increase from the same period of 2021.
"We capped off 2022 by delivering solid operating and financial results in the fourth quarter and full year. Our total revenues in the fourth quarter recorded a
Mr.
Fourth Quarter 2022 Financial Results
Total revenues were
Advertising revenue was
Paid membership revenue was
Content-commerce solutions revenue was RMB297.7 million (
Vocational training revenue[4] was
Other revenues were
Cost of revenues decreased by
Gross profit was
Total operating expenses was
Selling and marketing expenses increased to
Research and development expenses increased to
General and administrative expenses decreased by
Loss from operations decreased by
Adjusted loss from operations (non-GAAP)[1] decreased by
Net loss decreased by
Adjusted net loss (non-GAAP)[1] decreased by
Diluted net loss per American Depositary Share ("ADS") was
Cash and cash equivalents, term deposits and short-term investments
As of
Fiscal Year 2022 Financial Results
Total revenues were
Advertising revenue was
Paid membership revenue was
Content-commerce solutions revenue was RMB1,030.2 million (
Vocational training revenue[4] was
Other revenues were
Cost of revenues increased by
Gross profit increased to
Total operating expenses increased to
Selling and marketing expenses increased to
Research and development expenses increased to
General and administrative expenses decreased to
Loss from operations was
Adjusted loss from operations (non-GAAP)[1] was RMB1,218.8 million (
Net loss was
Adjusted net loss (non-GAAP)[1] was
Diluted net loss per ADS was
Share Repurchase Program
The Company announced a share repurchase program in
[1] Adjusted loss from operations and adjusted net loss are non-GAAP financial measures. For more information on the non-GAAP financial measures, please see the section of "Use of Non-GAAP Financial Measures" and the table captioned "Unaudited Reconciliations of GAAP and Non-GAAP Results" set forth at the end of this press release.
[2] MAUs refers to the sum of the number of mobile devices that launch our mobile app at least once in a given month, or mobile MAUs, and the number of logged-in users who visit our PC or mobile website at least once in a given month, after eliminating duplicates.
[3] Monthly subscribing members refers to the number of our Yan Selection (盐选) members in a specified month. Average monthly subscribing members for a period is calculated by dividing the sum of monthly subscribing members for each month during the specified period by the number of months in such period.
[4] Effective in the first quarter of 2022, the Company separately reported the revenue of its vocational training business, which was formerly included in "revenue - others," in light of the significant growth of the revenue contribution from vocational training to the Company's total revenues. For comparison purposes, the revenue of vocational training business and the revenue in "others" for each quarter of 2021 have been retrospectively re-classified.
Conference Call
The Company's management will host an earnings conference call at
All participants wishing to join the conference call must pre-register online using the link provided below. Once the pre-registration has been completed, each participant will receive a set of dial-in numbers, a passcode, and a unique registrant ID which can be used to join the conference call. Participants may pre-register at any time, including up to and after the call start time.
Participant Online Registration: https://dpregister.com/sreg/10176364/f620171988
Additionally, a live and archived webcast of the conference call will be available on the Company's investor relations website at https://ir.zhihu.com.
About
Use of Non-GAAP Financial Measures
In evaluating the business, the Company considers and uses non-GAAP financial measures, such as adjusted loss from operations and adjusted net loss, to supplement the review and assessment of its operating performance. The Company defines non-GAAP financial measures by excluding the impact of share-based compensation expenses, amortization of intangible assets resulting from business acquisitions and the tax effects of the non-GAAP adjustments, which are non-cash expenses. The Company believes that the non-GAAP measures facilitate comparisons of operating performance from period to period and company to company by adjusting for potential impacts of items, which the Company's management considers to be indicative of its operating performance. The Company believes that the non-GAAP financial measures provide useful information to investors and others in understanding and evaluating the Company's consolidated results of operations in the same manner as it helps the Company's management.
The non-GAAP financial measures are not defined under
Exchange Rate Information
This announcement contains translations of certain Renminbi amounts into
Safe Harbor Statement
This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the
For investor and media inquiries, please contact:
In
Email: ir@zhihu.com
Tel: +86-10-6508-0677
Email: zhihu@tpg-ir.com
In
Phone: +1-212-481-2050
Email: zhihu@tpg-ir.com
ZHIHU INC. | |||||||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||
(All amounts in thousands, except share, ADS, per share data and per ADS data) | |||||||||||||
For the Three Months Ended | For the Year Ended | ||||||||||||
2021 | 2022 | 2022 | 2021 | 2022 | |||||||||
RMB | RMB | RMB | US$ | RMB | RMB | US$ | |||||||
Revenues: | |||||||||||||
Advertising | 377,812 | 196,689 | 274,693 | 39,827 | 1,160,886 | 926,296 | 134,300 | ||||||
Paid membership | 208,756 | 335,435 | 402,531 | 58,362 | 668,507 | 1,230,804 | 178,450 | ||||||
Content-commerce solutions | 367,295 | 265,249 | 297,694 | 43,162 | 973,986 | 1,030,184 | 149,363 | ||||||
Vocational Training | 22,197 | 78,004 | 84,591 | 12,265 | 45,823 | 248,266 | 35,995 | ||||||
Others | 43,160 | 36,334 | 54,456 | 7,895 | 110,122 | 169,369 | 24,556 | ||||||
Total revenues | 1,019,220 | 911,711 | 1,113,965 | 161,511 | 2,959,324 | 3,604,919 | 522,664 | ||||||
Cost of revenues | (539,392) | (467,327) | (485,442) | (70,382) | (1,405,423) | (1,796,867) | (260,521) | ||||||
Gross profit | 479,828 | 444,384 | 628,523 | 91,129 | 1,553,901 | 1,808,052 | 262,143 | ||||||
Selling and marketing expenses | (470,175) | (478,279) | (509,229) | (73,831) | (1,634,733) | (2,026,468) | (293,810) | ||||||
Research and development | (208,006) | (160,760) | (212,495) | (30,809) | (619,585) | (763,362) | (110,677) | ||||||
General and administrative | (176,881) | (83,944) | (123,107) | (17,849) | (690,292) | (621,973) | (90,178) | ||||||
Total operating expenses | (855,062) | (722,983) | (844,831) | (122,489) | (2,944,610) | (3,411,803) | (494,665) | ||||||
Loss from operations | (375,234) | (278,599) | (216,308) | (31,360) | (1,390,709) | (1,603,751) | (232,522) | ||||||
Other income/(expenses): | |||||||||||||
Investment income | 22,107 | 23,138 | 5,922 | 859 | 59,177 | 70,380 | 10,204 | ||||||
Interest income | 9,877 | 14,598 | 33,671 | 4,882 | 31,305 | 68,104 | 9,874 | ||||||
Fair value change of financial | 6,100 | (79,322) | (4,619) | (670) | 27,846 | (176,685) | (25,617) | ||||||
Exchange (losses)/gains | (30,154) | 28,302 | (1,524) | (221) | (16,665) | 71,749 | 10,403 | ||||||
Others, net | (12,964) | (3,047) | 6,099 | 884 | (4,391) | 5,983 | 867 | ||||||
Loss before income tax | (380,268) | (294,930) | (176,759) | (25,626) | (1,293,437) | (1,564,220) | (226,791) | ||||||
Income tax expense | (3,023) | (2,655) | (2,755) | (399) | (5,443) | (14,183) | (2,056) | ||||||
Net loss | (383,291) | (297,585) | (179,514) | (26,025) | (1,298,880) | (1,578,403) | (228,847) | ||||||
Net income attributable to | - | (2,590) | (164) | (24) | - | (2,754) | (399) | ||||||
Accretions of convertible | - | - | - | - | (170,585) | - | - | ||||||
Net loss attributable to | (383,291) | (300,175) | (179,678) | (26,049) | (1,469,465) | (1,581,157) | (229,246) | ||||||
Net loss per share | |||||||||||||
Basic | (1.29) | (0.98) | (0.59) | (0.09) | (6.12) | (5.19) | (0.75) | ||||||
Diluted | (1.29) | (0.98) | (0.59) | (0.09) | (6.12) | (5.19) | (0.75) | ||||||
Net loss per ADS (Two ADSs | |||||||||||||
Basic | (0.65) | (0.49) | (0.29) | (0.04) | (3.06) | (2.59) | (0.38) | ||||||
Diluted | (0.65) | (0.49) | (0.29) | (0.04) | (3.06) | (2.59) | (0.38) | ||||||
Weighted average number of | |||||||||||||
Basic | 296,870,566 | 306,621,507 | 304,665,906 | 304,665,906 | 240,174,108 | 304,836,318 | 304,836,318 | ||||||
Diluted | 296,870,566 | 306,621,507 | 304,665,906 | 304,665,906 | 240,174,108 | 304,836,318 | 304,836,318 | ||||||
ZHIHU INC. | |||||||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (CONTINUED) | |||||||||||||
(All amounts in thousands, except share, ADS, per share data and per ADS data) | |||||||||||||
For the Three Months Ended | For the Year Ended | ||||||||||||
2021 | 2022 | 2022 | 2021 | 2022 | |||||||||
RMB | RMB | RMB | US$ | RMB | RMB | US$ | |||||||
Share-based compensation | |||||||||||||
Cost of revenues | 8,865 | (411) | 3,663 | 531 | 18,973 | 11,861 | 1,720 | ||||||
Selling and marketing | 10,419 | 6,647 | 5,019 | 728 | 31,947 | 24,334 | 3,528 | ||||||
Research and development | 25,514 | 16,608 | 15,831 | 2,295 | 57,595 | 62,503 | 9,062 | ||||||
General and administrative | 95,904 | 22,002 | 18,032 | 2,614 | 439,950 | 275,197 | 39,900 |
ZHIHU INC. | |||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | |||||
(All amounts in thousands) | |||||
As of 2021 | As of 2022 | ||||
RMB | RMB | US$ | |||
ASSETS | |||||
Current assets: | |||||
Cash and cash equivalents | 2,157,161 | 4,525,852 | 656,187 | ||
Term deposits | 2,815,509 | 948,390 | 137,504 | ||
Short-term investments | 2,239,596 | 787,259 | 114,142 | ||
Trade receivables | 831,628 | 834,251 | 120,955 | ||
Amounts due from related parties | 18,196 | 24,798 | 3,595 | ||
Prepayments and other current assets | 272,075 | 199,249 | 28,889 | ||
Total current assets | 8,334,165 | 7,319,799 | 1,061,272 | ||
Non-current assets: | |||||
Property and equipment, net | 9,865 | 7,290 | 1,057 | ||
Intangible assets, net | 68,308 | 80,237 | 11,633 | ||
73,663 | 126,344 | 18,318 | |||
Long-term investments | 19,127 | - | - | ||
Term deposits | 159,393 | - | - | ||
Right-of-use assets | 126,512 | 100,119 | 14,516 | ||
Other non-current assets | 14,132 | 22,450 | 3,255 | ||
Total non-current assets | 471,000 | 336,440 | 48,779 | ||
Total assets | 8,805,165 | 7,656,239 | 1,110,051 | ||
LIABILITIES AND SHAREHOLDERS' EQUITY | |||||
Current liabilities | |||||
Accounts payable and accrued liabilities | 1,026,534 | 916,112 | 132,824 | ||
Salary and welfare payables | 313,676 | 283,546 | 41,110 | ||
Taxes payables | 66,184 | 25,975 | 3,766 | ||
Contract liabilities | 239,757 | 355,626 | 51,561 | ||
Amounts due to related parties | 83,591 | 24,861 | 3,605 | ||
Short term lease liabilities | 40,525 | 53,190 | 7,712 | ||
Other current liabilities | 127,447 | 165,531 | 24,000 | ||
Total current liabilities | 1,897,714 | 1,824,841 | 264,578 | ||
Non-current liabilities | |||||
Long term lease liabilities | 82,133 | 43,367 | 6,288 | ||
Deferred tax liabilities | 14,030 | 11,630 | 1,686 | ||
Other non-current liabilities | 73,139 | 82,133 | 11,908 | ||
Total non-current liabilities | 169,302 | 137,130 | 19,882 | ||
Total liabilities | 2,067,016 | 1,961,971 | 284,460 | ||
6,730,654 | 5,653,696 | 819,709 | |||
Noncontrolling interests | 7,495 | 40,572 | 5,882 | ||
Total shareholders' equity | 6,738,149 | 5,694,268 | 825,591 | ||
Total liabilities and shareholders' equity | 8,805,165 | 7,656,239 | 1,110,051 |
ZHIHU INC. | |||||||||||||
UNAUDITED RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS | |||||||||||||
(All amounts in thousands) | |||||||||||||
For the Three Months Ended | For the Year Ended | ||||||||||||
2021 | 2022 | 2022 | 2021 | 2022 | |||||||||
RMB | RMB | RMB | US$ | RMB | RMB | US$ | |||||||
Loss from operations | (375,234) | (278,599) | (216,308) | (31,360) | (1,390,709) | (1,603,751) | (232,522) | ||||||
Add: | |||||||||||||
Share-based compensation | 140,702 | 44,846 | 42,545 | 6,168 | 548,465 | 373,895 | 54,210 | ||||||
Amortization of intangible | 2,400 | 2,763 | 3,490 | 506 | 4,380 | 11,053 | 1,603 | ||||||
Adjusted loss from | (232,132) | (230,990) | (170,273) | (24,686) | (837,864) | (1,218,803) | (176,709) | ||||||
Net loss | (383,291) | (297,585) | (179,514) | (26,025) | (1,298,880) | (1,578,403) | (228,847) | ||||||
Add: | |||||||||||||
Share-based compensation | 140,702 | 44,846 | 42,545 | 6,168 | 548,465 | 373,895 | 54,210 | ||||||
Amortization of intangible | 2,400 | 2,763 | 3,490 | 506 | 4,380 | 11,053 | 1,603 | ||||||
Tax effects on non-GAAP | (600) | (600) | (600) | (87) | (1,095) | (2,400) | (348) | ||||||
Adjusted net loss | (240,789) | (250,576) | (134,079) | (19,438) | (747,130) | (1,195,855) | (173,382) |
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