Release Date: April 21, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Yunji Inc (YJ, Financial) achieved an improved overall gross margin of 49.4% in 2024, indicating strong profitability.
- The user repurchase rate remained robust at 71.9%, reflecting high customer loyalty and satisfaction.
- The company's private label organic health products, such as probiotic bolus and slimming coffee, have gained significant consumer trust and generated substantial sales.
- Yunji Inc (YJ) successfully launched the SUYE Pro-Ascen firming series, generating over RMB20 million in sales, demonstrating strong demand for their skincare solutions.
- The Jianxin Tea Therapy Program showed promising results during its trial phase, with a 91% return rate among participants, indicating strong user engagement and loyalty.
Negative Points
- Total revenue decreased to RMB97.1 million from RMB149.1 million a year ago, indicating a decline in sales performance.
- The company experienced an increase in general and administrative expenses to RMB71.1 million, primarily due to severance payments and impairment charges.
- Net loss widened to RMB85 million compared to RMB65.9 million a year ago, reflecting financial challenges.
- Operating expenses increased to RMB126.2 million from RMB109.8 million in the same period of 2023, impacting profitability.
- Despite strategic cost-saving measures, near-term expenses such as severance costs partially offset the benefits, affecting the bottom line.
Q & A Highlights
Q: Can you provide more details about the Jianxin Tea Therapy Program and its significance?
A: The Jianxin Tea Therapy Program, launching in May, offers a unique wellness experience combining tea tasting, traditional Chinese studies, meditation, and stretching. It uses award-winning organic black tea from Wuyi Mountain, certified by multiple countries. The program is an 80-minute ritual divided into stretching, tea tasting, and sharing sessions, promoting self-healing and cultural appreciation. It aims to enhance personal wellness, strengthen community ties, and boost sales of organic health products.
Q: How did Yunji's financial performance fare in the first quarter of 2024?
A: Yunji reported total revenue of RMB97.1 million, down from RMB149.1 million the previous year. Despite a decrease in sales, the gross margin remained strong at 48.3% due to customer loyalty and effective product curation. Operating expenses increased to RMB126.2 million, resulting in a net loss of RMB85 million. The company is focused on optimizing costs and improving profitability.
Q: What strategic changes did Yunji implement in 2024 to enhance operational efficiency?
A: Yunji undertook a complete operational realignment, enhancing organizational structure, improving efficiency, and optimizing business layout. This included consolidating the health and finance businesses, refining staffing structures, and implementing cost reductions in fulfillment and technology. These changes aim to build a more efficient operational framework for future growth.
Q: How is Yunji's private label brand SUYE performing, and what are its future plans?
A: SUYE has seen significant success, with the Pro-Ascen firming series generating over RMB20 million in sales in 2024. The brand is expanding its product line in 2025 with new offerings like the SUYE Pro-Ascen firming lotion. SUYE aims to become a world-class leader in skincare by offering premium quality products at accessible prices and driving growth through innovation.
Q: What is Yunji's strategic focus for 2025 and beyond?
A: Yunji is committed to becoming a global leader in organic living, focusing on high-value organic health foods and advanced skincare products. The strategy involves shifting towards high-margin, high-repurchase products to enhance profitability and achieve breakeven. Yunji is also evolving into a service experience platform, leveraging opportunities in the silver economy and building health-focused communities through initiatives like the tea therapy wellness courses.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
