Here Group (HERE) Q3 2024 earnings summary

Executive summary

• Q3 FY2024 revenue grew 17.1% year-over-year to RMB945.6 million, driven by skills upgrading, elderly-focused courses, and new business initiatives.

• Adjusted net income reached RMB31.9 million, a 47.1% increase year-over-year, with net income at RMB14.6 million.

• Total registered users rose 40.3% to 121.0 million, and paying learners increased 48.4% to 0.5 million.

• Gross billings of individual online learning services increased 22.1% year-over-year to RMB981.5 million.

• Expanded course offerings, launched TCM and elderly-focused courses, and opened the first offline school in Hong Kong.

Financial highlights

• Gross profit was RMB799.7 million, with a gross margin of 84.6%, down from 87.5% last year.

• Adjusted net income for Q3 FY2024 was RMB31.9 million, with an adjusted net margin of 3.4%.

• Cash and short-term investments totaled RMB1,149.9 million as of March 31, 2024, up 35.2% year-over-year.

• Net cash provided by operating activities reached RMB272.6 million in FY2023.

• Cost of revenues rose 44.3% year-over-year to RMB145.8 million, mainly due to higher labor outsourcing and procurement costs.

Outlook and guidance

• Q4 FY2024 revenue expected between RMB900 million and RMB930 million, representing 8.7% to 12.3% year-over-year growth.

• Focus on expanding user base, investing in technology, and enriching course offerings.

• Plans to extend lifetime value through live e-commerce and develop enterprise services for synergistic growth.

• Pursuing global expansion and strategic partnerships to drive future growth.