RLX Technology(RLX) - 2025 Q2 - Quarterly Results

RLX Technology Q2 2025 Earnings Release Management Commentary and Financial Highlights The company reported strong Q2 2025 results driven by successful international expansion and improved profitability - The CEO attributed strong performance to effective strategy execution and solid progress in international expansion[4] - The CFO highlighted a 40.3% YoY revenue growth propelled by international momentum and a 147.6% YoY increase in non-GAAP operating income[4] Q2 2025 Key Financial Metrics (YoY Comparison) | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Net Revenues | RMB 880.0M | RMB 627.2M | +40.3% | | Gross Margin | 27.5% | 25.2% | +2.3pp | | Non-GAAP Income from Operations | RMB 116.2M | RMB 46.9M | +147.8% | | U.S. GAAP Net Income | RMB 218.5M | RMB 134.9M | +62.0% | | Non-GAAP Net Income | RMB 291.2M | RMB 214.8M | +35.6% | Detailed Financial Results (Q2 2025) The company achieved significant YoY revenue growth and margin expansion, leading to a substantial increase in net income Revenue and Gross Profit Q2 2025 Revenue and Gross Profit Performance | Metric | Q2 2025 | Q2 2024 | Change (YoY) | | :--- | :--- | :--- | :--- | | Net Revenues | RMB 880.0M | RMB 627.2M | +40.3% | | Gross Profit | RMB 242.1M | RMB 157.9M | +53.3% | | Gross Margin | 27.5% | 25.2% | +2.3pp | - The increase in net revenues was mainly driven by the company's expansion into international markets[5] - Gross margin increased primarily due to a favorable change in revenue mix and margin improvement in selected Asian countries[6] Operating Expenses Q2 2025 Operating Expenses Breakdown (YoY) | Expense Category | Q2 2025 | Q2 2024 | Primary Reason for Change | | :--- | :--- | :--- | :--- | | Selling Expenses | RMB 84.6M | RMB 62.2M | Increase in salaries, welfare, and branding expenses | | General & Administrative | RMB 88.4M | RMB 129.0M | Decrease in share-based compensation expenses | | Research & Development | RMB 30.1M | RMB 0.04M | Increase in share-based compensation expenses | | Total Operating Expenses | RMB 203.1M | RMB 191.2M | +6.2% | Profitability and Earnings Per Share (EPS) Q2 2025 Profitability Metrics (YoY) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | U.S. GAAP Income from Operations | RMB 39.0M | (RMB 33.3M) | | Non-GAAP Income from Operations | RMB 116.2M | RMB 46.9M | | U.S. GAAP Net Income | RMB 218.5M | RMB 134.9M | | Non-GAAP Net Income | RMB 291.2M | RMB 214.8M | Q2 2025 Earnings Per ADS (YoY) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | U.S. GAAP Diluted Net Income per ADS | RMB 0.166 | RMB 0.103 | | Non-GAAP Diluted Net Income per ADS | RMB 0.218 | RMB 0.165 | Balance Sheet and Cash Flow The company maintained a strong liquidity position with RMB 15.52 billion in cash and generated positive operating cash flow Key Balance Sheet and Cash Flow Data (as of June 30, 2025) | Metric | Amount (RMB) | | :--- | :--- | | Cash, equivalents, and investments | 15,524.3 million | | Total Assets | 17,486.2 million | | Total Liabilities | 1,246.8 million | | Total Shareholders' Equity | 16,239.4 million | | Net cash from operating activities (Q2 2025) | 229.6 million | Corporate Actions and Investor Information The company announced a cash dividend of US$0.01 per ADS and provided details for its upcoming earnings conference call Dividend Announcement - The Board of Directors approved a cash dividend of US$0.01 per ordinary share or US$0.01 per ADS[18] - The record date for ADS holders is September 12, 2025, with the payment date expected around September 26, 2025[18] Conference Call Information - An earnings conference call is scheduled for 8:00 AM U.S. Eastern Time on August 22, 2025[19] - Dial-in details and a webcast will be available on the company's investor relations website[20][21] Supplementary Information This section clarifies the use of non-GAAP financial measures and includes a safe harbor statement for forward-looking information Non-GAAP Financial Measures Explanation - The company uses non-GAAP measures to evaluate operating results and for internal decision-making purposes[24] - These measures typically exclude non-cash items like share-based compensation to identify underlying business trends[24][25] - The company advises that non-GAAP measures should not be considered in isolation and provides a reconciliation to U.S. GAAP measures[26][27] Safe Harbor Statement - The announcement contains forward-looking statements under the 'safe harbor' provisions of U.S. securities law[29] - These statements involve inherent risks, and actual results could differ materially due to factors like competition and regulatory changes[29]