Financial Data and Key Metrics Changes - In 2024, total revenue was reported at RMB 1,468 million, down 40% year-on-year, with subscription revenue at RMB 918 million, down 31.9%, and merchant solutions revenue at RMB 20 million, down 52% year-on-year [45][53][56] - Adjusted revenue, accounting for one-off discounts and policy impacts, would have been approximately RMB 2,090 million, indicating a more reasonable comparison to 2023 [61] - Operating loss increased to RMB 1,744 million, with significant portions attributed to one-off or non-cash items [66][72] Business Line Data and Key Metrics Changes - Subscription revenue accounted for 68% of total revenue, up 22 percentage points year-on-year, with smart retail solutions contributing 67% of subscription revenue [46][84] - Merchant solutions revenue saw a significant decline due to reduced rebates from Tencent, with expectations for stabilization in 2025 [11][12] - The company focused on high-quality development, leading to a contraction in low-margin businesses, which affected overall revenue [54] Market Data and Key Metrics Changes - The advertising gross billing reached RMB 18 billion, up 24.5% year-on-year, but profitability was not realized due to missed opportunities in platform policies [15][50] - The company maintained a strong position in the top 100 retailers, with GMV for retailers up 59% [18] - The overall market for WeChat mini shops is projected to grow significantly, with potential scales reaching RMB 2 trillion to RMB 3 trillion [32][96] Company Strategy and Development Direction - The company is focusing on key accounts and high-quality development, with a strategic contraction in non-core and low-quality businesses [8][54] - Future growth is expected to come from AI deployments and enhanced SaaS solutions, with a focus on efficiency and intelligent operations [90] - The company aims to deepen its ecosystem capabilities through cross-platform integration and partnerships with major players like Alipay and Huawei [86][36] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a challenging macroeconomic environment in 2024, impacting consumer retail and overall revenue [41] - There is confidence in a recovery for 2025, with expectations for subscription revenue growth and improved gross profit margins [73][39] - The company plans to enhance operational efficiency and customer mix to navigate the rebate decline and improve profitability [102] Other Important Information - The company completed a refinancing of its convertible bonds, reducing interest-bearing debt significantly [48][49] - Cash flow management improved, with a net cash inflow of RMB 300 million and free cash flow showing signs of recovery [51][68] Q&A Session Summary Question: What is the outlook for subscription business in 2025? - Management expects subscription revenue to stabilize with a growth projection of 5% to 10% in 2025, with a potential turnaround in profitability by 2026 [80][82] Question: What are the future business strategies and operation strategies? - The focus will be on key accounts, smart retail revenue, and enhancing ecosystem capabilities through cross-platform integration [84][86] Question: How will the company address the decline in advertising rebates? - The company plans to manage customer expectations and improve operational efficiency to maintain profitability despite rebate declines [99][102]
微盟集团(02013) - 2024 H2 - 业绩电话会