Zepp Health (ZEPP) Q4 2024 earnings summary

Executive summary

• Q4 2024 revenue was $59.5M, up over 40% sequentially, driven by the T-Rex 3 launch and brand-focused strategy, but down year-over-year due to Xiaomi declines and fewer new launches.

• Full-year 2024 revenue was $182.6M, meeting guidance but down 48.3% YoY as Xiaomi sales fell 88% and Amazfit sales dropped 34.2%.

• Transitioned to a high-margin, self-branded business model, with gross margin rising to 38.5% in 2024 from 26.2% in 2023.

• Units shipped in FY24 totaled 4.0M, with 2.3M Amazfit-branded and 1.7M Xiaomi units.

• Expanded product portfolio with AI-powered wearables and health solutions, including T-Rex 3, Active 2, Bip 6, and V1TAL.

Financial highlights

• Q4 2024 gross margin improved to 36.8% (vs. 34.7% prior year); FY24 gross margin rose to 38.5% (vs. 26.2% in FY23).

• Q4 adjusted operating loss was $7.4M, the narrowest in four quarters; adjusted net loss was $22.5M.

• FY24 adjusted net loss was $56.7M; GAAP net loss was $75.8M.

• Cash and equivalents at year-end 2024 were $111M, down from $140M, with improved inventory management.

• Inventory at $56.8M was the lowest since 2018.

Outlook and guidance

• Q1 2025 revenue expected at $40–$45M, with Amazfit-branded product revenue up 14–29% YoY.

• 2025 to feature 1–2 new product launches per quarter, supporting sustained growth and margin expansion.

• Management expects gross margin improvement to continue in 2025 with new launches.

• Continued share repurchase program, extended through November 2026, with $15M spent to date.

• Focus on international expansion, new products, value-added services, and strict cost control.