Phoenix New Media (FENG) Q2 2024 earnings summary

Executive summary

• Q2 2024 operations remained stable, with performance targets met and a significant reduction in losses year-over-year; revenues fell 6.6% to RMB 168.3 million, mainly due to declines in net advertising and paid services revenues.

• Gross profit rose 17.0% year-over-year to RMB 65.4 million, with gross margin improving to 38.9% from 31.0% due to cost controls.

• Net loss attributable to shareholders narrowed to RMB 5.5 million from RMB 31.3 million a year ago; net margin improved to -3.2% from -17.4%.

• Management emphasized operational efficiency, content quality, and new revenue streams to strengthen market position.

• Enhanced media influence through high-quality content, news reporting, and broad online distribution.

Financial highlights

• Total revenues were RMB 168.3 million, down from RMB 180.2 million year-over-year, a 6.6% decline.

• Net advertising revenues reached RMB 154.7 million, compared to RMB 161.8 million in Q2 2023, a 4.4% decrease.

• Paid services revenues were RMB 13.6 million, down from RMB 18.4 million year-over-year, a 26.1% drop.

• Cost of revenues decreased by 17.2% to RMB 102.9 million, improving gross margin from 31% to 38.9%.

• Loss from operations narrowed to RMB 8.9 million from RMB 35.7 million year-over-year; net loss per share was RMB 0.01, compared to RMB 0.05 in Q2 2023.

Outlook and guidance

• Q3 2024 total revenues forecasted between RMB 131.6 million and RMB 166.6 million; some guidance places the lower end at RMB 151.6 million.

• Net advertising revenues expected between RMB 142.3 million and RMB 152.3 million; paid service revenues between RMB 9.3 million and RMB 14.3 million.

• Guidance reflects management’s preliminary view amid substantial macroeconomic uncertainty.