Core Viewpoint - After years of continuous losses, Zhihu has finally achieved profitability, marking a significant milestone in its financial journey [1][7][32] Financial Performance - In the fiscal year 2024, Zhihu reported a revenue of 3.6 billion RMB, still in a declining trend, but the net loss narrowed to 169 million RMB, a year-on-year reduction of 79.9% [1] - For Q4 2024, Zhihu achieved a revenue of 860 million RMB and a net profit of 86.4 million RMB, compared to a net loss of 103.1 million RMB in the same period of 2023 [1][2] - The adjusted net profit for Q4 was 97.1 million RMB, with an adjusted operating profit of 23.1 million RMB, all exceeding market expectations [1][2] Cost Management - Zhihu significantly reduced costs and expenses in Q4 2024, with costs down by 31.5% to 318.5 million RMB, and expenses down by 37.9% to 528.8 million RMB [9] - The cost reduction was attributed to lower content and operational costs, improved technical efficiency, and stricter management of promotional and personnel-related expenses [9][10] Strategic Focus - The company has prioritized achieving profitability over revenue growth, indicating a strategic shift towards cost control and efficiency [12][14] - Despite a revenue decline of 24.5% year-on-year in Q4, Zhihu's gross profit margin improved from 54.7% in 2023 to 60.6% in 2024, with Q4 reaching 62.9% [11][12] AI Integration - Zhihu views AI as a historic opportunity, launching its AI product "Zhihu Direct Answer" which has seen its monthly active users (MAU) grow to over 10 million [3][6][18] - The integration of AI aims to enhance user interaction and content discovery, leveraging Zhihu's unique content pool to differentiate itself from competitors [19][20][22] Market Reaction - The capital market responded positively to Zhihu's financial results, with its stock price rising over 30% year-to-date [2][3] - Analysts recognize Zhihu's potential in the AI space, highlighting its unique content advantages and the ability to leverage its community for growth [23][32] Future Outlook - Zhihu aims to continue its path towards profitability while exploring AI opportunities, with a target to significantly reduce losses or achieve profitability by 2025 [16][32] - The company is also focusing on expanding its membership services, which contributed nearly half of its revenue in 2024, indicating room for growth in this area [26][27]

Group 1 - The core point of the article is that Zhihu has achieved its first quarterly profit, primarily due to significant cost reductions, despite facing declines in annual revenue and monthly active users [1][2][3] - In Q4 2024, Zhihu reported a net profit of 86.4 million yuan, compared to a net loss of 103.1 million yuan in the same period of 2023 [1] - The adjusted net profit for Q4 2024 was 97.1 million yuan, while the adjusted net loss for Q4 2023 was 91.3 million yuan [1] Group 2 - Zhihu's total revenue for 2024 was 3.6 billion yuan, representing a year-on-year decline of 14.3%, with Q4 revenue at 859 million yuan, down 25% year-on-year [2] - The monthly active user count for 2024 was 81.4 million, a decrease of 21% from 105 million in the previous year [2] - The company aims to focus on AI business development, having launched products like Zhihu Zhidao, which has reached millions of monthly active users within six months [3]

Core Insights - Zhihu reported a total revenue of 3.599 billion yuan for 2024, a year-on-year decrease of 14.3%, while net loss narrowed to 169 million yuan, a reduction of 79.9% compared to the previous year [1] - The fourth quarter of 2024 marked a significant milestone for Zhihu, achieving a net profit of 97.1 million yuan, the first time the company has reached profitability since its IPO [2][3] - The CEO emphasized the importance of 2024 as a turning point for Zhihu, highlighting the successful execution of strategic plans and the integration of AI into community interactions [1][4] Financial Performance - In Q4 2024, Zhihu's revenue was 860 million yuan, with an adjusted net profit of 97.1 million yuan and an adjusted operating profit of 23.1 million yuan, marking the first quarter of comprehensive profitability [2] - The revenue structure for Q4 included 420 million yuan from paid memberships (48.9% of total revenue), 320 million yuan from marketing services (36.8%), and 84 million yuan from vocational education [2] - For the full year 2024, paid membership and marketing services were the main revenue contributors, generating 1.762 billion yuan and 1.247 billion yuan respectively, with a decline in revenue across major business segments compared to 2023 [3] Operational Efficiency - Zhihu improved operational efficiency and cost management, resulting in a gross margin increase of 3.8 percentage points to 62.9% and a 37.9% reduction in operating expenses year-on-year [2][3] - As of the end of Q4 2024, Zhihu had cash and cash equivalents totaling 4.86 billion yuan, providing a solid foundation for continued profitability enhancement [3] AI Investment and Strategy - Zhihu has increased investments in AI, enhancing its self-developed large model "Zhihai Map AI" and improving various model capabilities [4] - The integration of AI into Zhihu's operations has significantly boosted business efficiency, with the AI search product "Zhihu Direct Answer" undergoing multiple iterations to enhance community and creator value [4] - The CEO stated that AI will greatly promote Zhihu's development, as the platform's expert network is essential in addressing trust issues in the AI era [5] User Engagement - By the end of Q4 2024, Zhihu's content creation volume reached 870 million, a year-on-year increase of 12.9%, with over 77 million creators actively participating [5] - The average monthly active users (MAUs) reached 81.4 million, showing continued quarter-on-quarter growth, while the average monthly subscription members reached 14.1 million [5]

Financial Data and Key Metrics Changes - In Q4 2024, the company reported an adjusted net income of RMB97.1 million, a significant turnaround from an adjusted net loss of RMB91.3 million in the same period last year [8] - The adjusted operating profit improved from a loss of RMB165.3 million in Q4 2023 to a profit of RMB23.1 million in Q4 2024 [8] - Total revenues for Q4 2024 were RMB859.2 million, down from RMB1,138.3 million in Q4 2023, reflecting a strategic shift away from lower-quality revenue [39][41] - The gross margin expanded to 62.9%, driven by improved operational efficiency and disciplined cost management [44] Business Line Data and Key Metrics Changes - Paid membership revenue was RMB420.2 million, a decrease from RMB455.9 million in Q4 2023, with average monthly paid members slightly declining by 0.8% year-over-year [41][25] - Vocational training revenue decreased by 50.4% year-over-year to RMB84 million, primarily due to strategic refinements in the acquired business [32][42] - Marketing services revenue reached RMB315.9 million, down from RMB465.2 million in Q4 2023, but showed a sequential growth of 23.1% [28][41] Market Data and Key Metrics Changes - The average monthly active users (MAUs) were 81.4 million, reflecting a 0.3% sequential increase despite a significant reduction in promotional expenses [13] - The community of content creators grew to 77.7 million, an increase of 8.9% year-over-year, with income-generating creators rising by over 22% year-over-year [18][19] Company Strategy and Development Direction - The company is focusing on enhancing community trust and user experience while forgoing some peripheral users to drive profitability [9][23] - AI is viewed as a historic opportunity, with plans to deepen integration between AI and the community to improve content quality and user engagement [10][36] - The company aims to strengthen its position as a trusted content platform by expanding into specialized verticals and introducing new original IPs [58] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's strategic roadmap and execution capabilities, highlighting a transformative turnaround in 2024 [7] - The CEO emphasized the importance of trustworthiness in the AI era, stating that the expert network is essential for combating AI-generated content issues [52] - The company plans to maintain a focus on profitability while exploring new opportunities arising from AI integration [74] Other Important Information - The company repurchased a total of 75.3 million Class A ordinary shares for an aggregate value of US$1.2 billion since its Hong Kong IPO [46] - The company achieved a double-digit non-GAAP net profit margin of 11% in Q4 2024, marking a significant milestone in its financial performance [72] Q&A Session Summary Question: Insights on Zhihu Zhida user size data and its benefits to the community - The CEO reported that Zhida's MAUs grew from about 1 million to 10 million, driven by high repeat visits and positive word-of-mouth [51] - The expert network is crucial in the AI era, as it provides trustworthy content amidst the rise of AI-generated content [52] Question: Expected changes and innovations on the product side this year - The CEO mentioned a focus on strengthening social interactions and enhancing the brand as a trusted content platform, with developments in social circles and new content formats [58][61] Question: How AI and large language models can benefit Zhihu's online marketing product - The CFO noted that AI is changing the monetization model of advertising, with a shift towards content marketing and brand reputation management on the platform [66][69] Question: Long-term margin profile and cash utilization outlook - The CFO indicated that the company achieved a double-digit net profit margin and sees AI as a historical opportunity for growth, with plans for share repurchases due to undervaluation [72][74]

Core Viewpoint - Zhihu has achieved profitability for the first time since its listing, marking a significant milestone in its financial performance [2][3] Financial Performance - In Q4 2024, Zhihu reported revenue of 859 million yuan and a net profit of 86.4 million yuan, compared to a net loss of 103 million yuan in the same period of 2023 [1] - Zhihu's marketing service revenue decreased to 316 million yuan from 465 million yuan year-on-year, while paid membership revenue fell to 420 million yuan from 456 million yuan [4] - The overall cost of revenue decreased from 465 million yuan to 319 million yuan, leading to a gross profit of 540 million yuan and a gross margin increase from 59.1% to 62.9% [5] Operational Efficiency - Zhihu improved its operational efficiency, reducing total operating expenses from 851 million yuan to 529 million yuan, resulting in an operating profit of 11.9 million yuan [5] - As of the end of Q4, Zhihu had over 77 million creators and a total content creation volume of 870 million pieces, reflecting a year-on-year growth of 12.9% [5] AI Integration - AI has become a key focus for Zhihu's future development, with ongoing investments in AI applications to enhance user interaction and competitive advantage [2] - Zhihu has launched AI search products like "Zhihu Direct Answer," which have undergone multiple iterations to improve search result quality and user engagement [7] - The integration of AI technologies has not only transformed Zhihu's business but also enhanced the professional value of its content community [8]

Financial Data and Key Metrics Changes - In Q4 2024, the company reported an adjusted net income of RMB97.1 million, a significant turnaround from an adjusted net loss of RMB91.3 million in the same period last year [7] - The adjusted operating profit improved from an adjusted net operating loss of RMB165.3 million in Q4 2023 to an adjusted operating profit of RMB23.1 million in Q4 2024 [7] - Total revenues for Q4 2024 were RMB859.2 million, compared to RMB1,138.3 million in Q4 2023, reflecting a strategic shift away from lower quality revenue [29][30] - Full year 2024 revenues were RMB3,598.9 million, a decrease of 14.3% from the previous year [19] Business Line Data and Key Metrics Changes - Paid membership revenue for Q4 2024 was RMB420.2 million, down from RMB455.9 million in Q4 2023, with average monthly paid members slightly decreasing by 0.8% year over year [20][30] - Vocational training revenue decreased by 50.4% year over year to RMB84 million in Q4 2024, primarily due to strategic refinements [24][30] - Marketing services revenue reached RMB315.9 million in Q4 2024, down from RMB465.2 million in the same period last year, but showed a sequential growth of 23.1% [22][30] Market Data and Key Metrics Changes - Average Monthly Active Users (MAUs) were 81.4 million, up 0.3% sequentially, despite a significant reduction in community-related promotional expenses [11] - Time spent per Daily Active User (DAU) grew by 23% year over year, indicating improved user engagement [11] - The community of content creators reached 77.7 million, an increase of 8.9% year over year, with income-generating creators increasing by over 22% year over year [15] Company Strategy and Development Direction - The company emphasized prioritizing community trust and enhancing core user experience, leading to a deliberate choice to forgo some peripheral users [7] - AI is viewed as a historic opportunity, with the company focusing on authentic, professional content to help AI overcome challenges [8][27] - The company plans to deepen integration of AI into its community and workflows to enhance content creation and distribution efficiency [48][49] Management's Comments on Operating Environment and Future Outlook - Management highlighted that the fourth quarter marked a transformative turnaround, achieving profitability for the first time [6][27] - The company is confident that its strategic focus on trust and quality will yield long-term benefits, despite short-term trade-offs [19][27] - Looking ahead to 2025, the company aims to enhance community trust while exploring innovative AI applications [28][59] Other Important Information - The company has cash and cash equivalents totaling RMB4.9 billion as of December 31, 2024, down from RMB5.5 billion a year earlier [33] - The company repurchased a total of 75.3 million Class A ordinary shares for an aggregate value of approximately $1.2 billion [33] Q&A Session Summary Question: Insights on Zihu Ju Da user size and its benefits to the community ecosystem - Management reported that JUDA's MAU grew from about 1 million to 10 million, driven by high repeat visits and positive word-of-mouth [37] - The expert network within the community is crucial for providing trustworthy content amidst the rise of AI-generated content [38][39] Question: Expectations for product changes and AI integration - The company plans to strengthen social interactions and enhance its brand as a trusted content platform, focusing on both short-form and long-form content [46][47] - AI will be integrated into community workflows to boost content creation efficiency [48] Question: Benefits of AI and market model to online marketing products - AI is changing the monetization model of advertising, with a focus on high-quality content generated by experts [53][54] Question: Long-term margin profile and cash utilization outlook - The company achieved a double-digit non-GAAP net profit margin of 11% in Q4 2024, with expectations for continued profitability growth [58][59] - The company plans to conduct share buybacks while maintaining a strong cash position [59]

Financial Data and Key Metrics Changes - In Q4 2024, the company reported an adjusted net income of RMB97.1 million, a significant turnaround from an adjusted net loss of RMB91.3 million in the same period last year [8] - The total revenues for Q4 were RMB859.2 million, compared to RMB1,138.3 million in Q4 2023, reflecting a strategic shift away from lower quality revenue [29] - Full year revenues for 2024 were RMB3,598.9 million, a decrease of 14.3% from the previous year [19][30] - The gross profit for Q4 was RMB540.7 million, with a gross margin of 62.9%, indicating improved operational efficiency [31] Business Line Data and Key Metrics Changes - Paid membership revenue was RMB420.2 million, down from RMB455.9 million in the same period last year, with average monthly paid members slightly decreasing by 0.8% year over year [20][30] - Vocational training revenue decreased by 50.4% year over year to RMB84 million, primarily due to strategic refinements of the acquired business [24][30] - Marketing services revenue reached RMB315.9 million, showing a sequential growth of 23.1% compared to the previous quarter [22][30] Market Data and Key Metrics Changes - Average Monthly Active Users (MAUs) were 81.4 million, up 0.3% sequentially, despite a significant reduction in community-related promotional expenses [12] - The community of content creators grew to 77.7 million, an increase of 8.9% year over year, reflecting a vibrant creator ecosystem [16] Company Strategy and Development Direction - The company emphasized a strategic focus on community trust and enhancing user experience, leading to a deliberate reduction in user acquisition expenses by 88% year over year [8][19] - AI is viewed as a historic opportunity, with the company planning to leverage its expert network to enhance content quality and trustworthiness [10][28] - The company aims to deepen integration of AI into its community workflows to boost content creation efficiency [51] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to maintain profitability and improve margins, with a double-digit net profit margin of 11% achieved in Q4 [61] - The company plans to continue investing in strategic initiatives, even if it means incurring short-term losses, to capture long-term growth opportunities [27][62] Other Important Information - The company has cash and cash equivalents totaling RMB4.9 billion as of December 31, 2024, down from RMB5.5 billion a year earlier [34] - The company has been active in share repurchases, having repurchased a total of 75.3 million Class A ordinary shares for an aggregate value of approximately $1.2 billion [34] Q&A Session Summary Question: Insights on Zihu Ju Da user size and its benefits to the Zhihu community - Management reported that JUDA's MAU grew from about 1 million to 10 million, driven by high repeat visits and positive word-of-mouth [38] - The expert network of Zhihu is deemed irreplaceable, especially in the context of AI-generated content and the need for trustworthy information [39][40] Question: Expected changes and innovations on the product side this year - The focus will be on strengthening social interactions and enhancing the brand as a trusted content platform, with new initiatives in social circles and original IPs [49][50] Question: How AI and market models benefit Zhihu's online marketing products - AI is changing the monetization model, with a shift towards high-quality content being prioritized by AI systems, enhancing Zhihu's competitive advantage [56][57] Question: Long-term margin profile and cash utilization outlook - The company achieved a double-digit net profit margin and plans to maintain a slightly overall loss temporarily to pursue growth opportunities [61][62]

知乎2024年第四季度营收同比下降24.5%，首次实现盈利，主要归功于其在成本控制方面的进步。毛利率扩大至62.9%，较去年同期的59.1%上升了3.8个 百分点。 26日，知乎发布2024年第四季度及全年业绩报告： 1）主要财务数据： | | | For the Three Months Ended | | | | For the Year Ended | | | --- | --- | --- | --- | --- | --- | --- | --- | | | December 31. | September 30. | December 31. | | December 31. | December 31. | | | | 2023 | 2024 | 2024 | | 2023 | 2024 | | | | RMB | RMB | RMB | US$ | RMB | RMB | US$ | | Revenues: | | | | | | | | | Marketing services | 465,153 | 256,631 | 315.940 | 43,284 | 1,652,992 | 1.24 ...

Core Insights - Zhihu achieved its first quarterly profit in Q4 2024, with a net profit of RMB 86.4 million, compared to a net loss of RMB 103.1 million in the same quarter of 2023 [1][2] - The adjusted net profit for Q4 2024 was RMB 97.1 million, a significant improvement from an adjusted net loss of RMB 91.3 million in Q4 2023 [1] - The average monthly active users reached 81.4 million in Q4 2024, while the average monthly subscription members were 14.1 million [1] Financial Performance - Total revenue for the year 2024 was RMB 3.599 billion, a decrease of 14.5% year-on-year [2] - Gross margin improved from 54.7% in 2023 to 60.6% in 2024 [2] - The net loss for 2024 was RMB 169 million, a reduction of 79.9% compared to a net loss of RMB 839 million in 2023 [2] - Adjusted net loss for 2024 was RMB 96.3 million, narrowing by 85.4% from RMB 659 million in 2023 [2] Operational Highlights - Zhihu's community ecosystem has been optimized, leading to improved user engagement and creator activity [1] - The company is investing in AI applications to enhance user interaction and strengthen its competitive advantage [1]

Financial Performance - Total revenue for the year ended December 31, 2024, was RMB 3,598.9 million, a decrease of 14.3% compared to RMB 4,198.9 million in 2023[5]. - Gross profit for the same period was RMB 2,180.8 million, down 5.0% from RMB 2,295.8 million in 2023[5]. - Net loss narrowed by 79.9% to RMB 169.0 million in 2024 from RMB 839.5 million in 2023[5][13]. - Adjusted operating loss improved by 54.4% to RMB 405.4 million in 2024 from RMB 888.0 million in 2023[5]. - The company achieved an adjusted net profit of RMB 97.1 million in Q4 2024, marking a significant turnaround[13]. - The gross margin expanded to 60.6% in 2024, the highest level in five years[13]. - The paid membership revenue for 2024 was RMB 1.76 billion, down 3.5% from RMB 1.83 billion in 2023[22]. - Marketing services revenue for 2024 was RMB 1.2 billion, down from RMB 1.7 billion in 2023, primarily due to ongoing optimization of service product offerings[29]. - Cost of revenue decreased by 25.5% to RMB 1.4 billion in 2024 from RMB 1.9 billion in 2023, mainly due to reduced content and operating costs[31]. - Operating expenses decreased by 21.0% in 2024, totaling RMB 2.66 billion compared to RMB 3.37 billion in 2023[25]. User Engagement - Average monthly active users decreased by 21.2% to 83.0 million in 2024 from 105.3 million in 2023[5]. - The average monthly active users rose from 14.5 million in 2023 to 15.0 million in 2024[18]. - The average monthly active users aged under 30 accounted for 73.8% of the total active users as of December 31, 2024[19]. - The number of content creators on the platform increased by 8.9% year-over-year, reaching 77.7 million by December 31, 2024[20]. Operational Efficiency - The company is focusing on enhancing operational efficiency through AI applications, improving content identification and review processes[15]. - The company aims to leverage artificial intelligence to improve operational efficiency across all business lines[24]. - The company plans to enhance operational efficiency and reduce losses through stricter cost management and optimized expense structures[24]. Shareholder and Governance - The company has not declared any annual dividend for the reporting period[59]. - The company has implemented a share incentive plan to motivate eligible employees towards growth and development[49]. - The company has complied with all applicable principles and provisions of the corporate governance code during the reporting period, except for the combined roles of Chairman and CEO[51]. - The audit committee, consisting of three independent non-executive directors, has reviewed the unaudited annual results for the reporting period[53]. - The board of directors consists of both executive and independent non-executive members, ensuring diverse governance[82]. Cash and Assets - Cash and cash equivalents at the end of 2024 were RMB 4.0 billion, up from RMB 2.1 billion at the end of 2023[40]. - Total assets decreased to RMB 5,732,952 thousand in 2024 from RMB 6,795,272 thousand in 2023[63]. - Total liabilities reduced to RMB 1,537,266 thousand in 2024, down from RMB 2,093,662 thousand in 2023, showing a decrease of approximately 26.5%[64]. - The company had no significant investments or acquisitions in 2024[41][42]. Taxation - The company has no income tax obligations in the Cayman Islands, where it is registered, which may positively impact its net income[79]. - Hong Kong subsidiaries with taxable profits of HKD 2 million or below are subject to a profit tax rate of 8.25%, while profits above HKD 2 million are taxed at 16.5%[80]. - In China, foreign-invested enterprises are subject to a corporate income tax rate of 25%, with certain entities recognized as high-tech enterprises eligible for a reduced rate of 15%[81]. - For the fiscal year ending December 31, 2024, the total income tax expense was RMB (9,391) thousand, compared to RMB 11,832 thousand for the previous year[81]. Strategic Initiatives - The company plans to continue focusing on market expansion and new product development as part of its strategic initiatives moving forward[65]. - The launch of the AI search feature "Zhihu Zhidao" received positive user feedback and was officially launched in June 2024[14]. - The "Professional Search" feature was introduced in October 2024, integrating over 50 million academic articles to support professionals[14].