Core Viewpoint - Zhibao Technology Inc. reported a net loss of approximately RMB 8.5 million ($1.2 million) for the six months ended December 31, 2023, a significant decline from a net income of approximately RMB 8.9 million in the same period of 2022, primarily due to decreased revenues and operational challenges [6][15][41]. Financial Performance - Total revenues for the six months ended December 31, 2023, decreased by approximately 8% to RMB 84.3 million ($11.9 million) from RMB 91.8 million in the same period of 2022 [12][41]. - The revenue decline was attributed to a decrease in insurance brokerage service fees and managing general underwriting (MGU) services, with specific account renewals dropping and a reinsurance partner's abrupt business closure impacting results [41]. - Cost of revenues decreased to approximately RMB 54.2 million ($7.6 million), a reduction of about 8% from RMB 58.7 million in the same period of 2022, aligning with the revenue decrease [19]. Operational Highlights - The number of B channels increased from approximately 1,000 to nearly 1,500, contributing to the growth of the 2B2C embedded digital insurance model [7]. - The company expanded its collaborations with 118 insurance and reinsurance companies as of December 31, 2023, enhancing its market position [14]. - Zhibao launched customized household insurance in seven cities and regions across China, including major cities like Guangzhou and Nanjing, and provided sports insurance coverage for over 100,000 instances [15][38]. Strategic Initiatives - The company completed "Project Amoeba," a reorganization aimed at improving operational efficiency by establishing 27 mid- and back-office service teams that operate as quasi-profit centers [9]. - Zhibao is actively pursuing mergers and acquisitions to enhance its business model and expand its market presence, although no definitive agreements have been reached as of the press release date [16]. Investment in Growth - Sales and marketing expenses increased by approximately 66%, and research and development (R&D) expenses rose by approximately 82% compared to the same period in 2022, reflecting the company's commitment to driving future revenue growth [13][20][21]. - The company served over 10 million end customer users as of December 31, 2023, indicating a strong user base that is expected to contribute to revenue growth in the coming years [36].
Zhibao Technology Inc. Announces Unaudited Financial Results for the Six Months Ended December 31, 2023