Zepp Health Corporation Reports Third Quarter 2022 Unaudited Financial Results

BEIJING, Nov. 21, 2022 /PRNewswire/ -- Zepp Health Corporation ("Zepp" or the "Company") (NYSE: ZEPP) today reported revenues of RMB1.2 billion (US$169.5 million); a GAAP diluted net loss per share of RMB0.07 (US$0.01); and a GAAP diluted net loss per ADS of RMB0.28 (US$0.04) for the third quarter ended September 30, 2022. Each ADS represents four Class A ordinary shares.

"While challenging macro dynamics persist, we further improved our top line on a quarter-over-quarter basis and restored growth in sales of our self-branded products in the third quarter, thanks to our unremitting efforts in product innovation as well as our strong channel and go-to-market capabilities. For example, in the North American market, we saw revenue growth of 23% year-over-year and 54% quarter-over-quarter," said Wang Huang, Chairman and CEO of Zepp Health. "We are also encouraged by the initial launch of Zepp Clarity, our hearing aid product line, and Zepp Aura, our personal AI composer service for improving sleep quality. These launches represent important milestones in our expansion into the healthcare service sector, which we believe will usher in a new phase of growth for Zepp. Leveraging our proprietary and evolving Zepp Digital Health Management Platform, we remain confident in our ability to create and deliver new, innovative fitness and healthcare products and services, helping more users live a healthy life."

Chief Financial Officer Leon Deng added, "Amid global economic and geopolitical uncertainties and prolonged pandemic-related impacts on our operations, our third quarter revenues came in at RMB1.2 billion, in line with our previous guidance and down 24.9% year-over-year. However, we are pleased to see that for the first time this year we logged revenue growth of 4.2% year-over-year and 35.6% quarter-over-quarter in our self-branded products owing to our upgraded and expanded self-branded product portfolio. Moreover, as we continued to enhance our operational efficiency with streamlined organization and disciplined expense control, our reported net loss for the quarter narrowed to RMB17.1 million and adjusted net loss narrowed sequentially to RMB8.8 million, despite severance payment of RMB10 million. Our cash position remains strong, with RMB1.01 billion in cash, cash equivalents and restricted cash, while our inventory decreased further compared with the end of last quarter. Looking to the future, cost structure optimization remains our primary focus. With more disciplined cost reduction measures and ROI-based operations, we will strive to return to profitability to create incremental shareholder value."

Third Quarter 2022 Financial Summary