ZKH Group Limited Announces Second Quarter 2025 Unaudited Financial Results

Core Viewpoint - ZKH Group Limited reported a decline in key financial metrics for the second quarter of 2025, including a 3.7% decrease in net revenues and a 12.1% drop in Gross Merchandise Value (GMV), while also achieving growth in customer base and operational efficiency despite macroeconomic challenges [1][5][14]. Financial Performance - Net revenues for Q2 2025 were RMB 2,166.8 million (US$ 302.5 million), down 3.7% from RMB 2,250.0 million in Q2 2024 [5][11]. - GMV decreased to RMB 2,420.2 million, a 12.1% decline from RMB 2,754.6 million in the same quarter of the previous year [2][5]. - The ZKH platform GMV fell by 13.5%, while the GBB platform saw a slight increase of 0.4% [2]. - Net loss narrowed to RMB 53.5 million (US$ 7.5 million) from RMB 66.3 million in Q2 2024, indicating improved cost management [14][15]. Operational Highlights - The number of customers increased by 53.5% year-over-year, reaching 74,854, with significant growth in the GBB platform customer base [2][5]. - The operational launch of the Taicang facility is expected to enhance R&D and production capabilities, contributing to future competitiveness [1][2]. Cost Management - Cost of revenues decreased by 3.1% to RMB 1,809.8 million, reflecting effective cost reduction initiatives [8][11]. - Gross profit was RMB 356.9 million, down 6.8% from the previous year, with a gross margin of 16.5% [9][10]. Strategic Initiatives - The company is focusing on higher-margin private-label products, which have shown growth despite overall revenue declines [1][14]. - ZKH is committed to long-term investments and maintaining a lean operational structure to support sustainable growth [1][14]. Share Repurchase Program - As of June 13, 2025, ZKH had repurchased approximately 0.36 million ADSs for about US$ 1.10 million under a new share repurchase program [19][20]. Balance Sheet and Cash Flow - As of June 30, 2025, cash and cash equivalents totaled RMB 1.85 billion (US$ 258.4 million), down from RMB 2.06 billion at the end of 2024 [18]. - Net cash used in operating activities was RMB 110.7 million in Q2 2025, compared to net cash generated of RMB 122.1 million in Q2 2024 [18].