So-Young(US:SY)2025-08-18 01:00Summary of So-Young's Q2 2025 Earnings Call Company Overview - Company: So-Young International Inc - Industry: Medical Aesthetics Key Financial Performance - Q2 2025 total revenue reached RMB 379 million, with aesthetic center revenue at RMB 144 million, marking a strategic shift as the largest revenue segment for the first time [2][3] - Total revenues decreased by 7% year-over-year to RMB 378.7 million, primarily due to a decline in information service revenues [2][15] - Aesthetic treatment service revenues soared by 426.1% year-over-year to RMB 144.4 million [15] - Net loss recorded at RMB 36 million, compared to a net income of RMB 18.9 million in the same period last year [16] Operational Highlights - Aesthetic center business saw a 46% quarter-over-quarter and 426% year-over-year revenue increase, driven by expansion to 29 centers [2][4] - Over 100,000 active users and 67,400 verified treatment visits in Q2, up 24% quarter-over-quarter and 381% year-over-year [4] - High repeat purchase rate exceeding 60% and customer satisfaction score of approximately five out of five [5] Strategic Initiatives - New treatments launched in Q2 2025 include Miracle PLLA, Mermaid Skin Booster, and BBL Hero, enhancing the product portfolio and increasing average revenue per user (ARPU) [2][9] - Customer acquisition strategies focus on cost efficiency, with over 70% of new clients coming from existing customers [7][21] - Plans to open around ten new aesthetic centers in Q3 2025, aiming for a total of 50 centers by the end of the year [11][17] Quality Assurance and Service Delivery - Rigorous physician selection and standardized training ensure high service quality, with nearly 90% of doctors being specialist dermatologists [6][24] - Digitalization and AI-driven solutions enhance transparency and traceability in medical experiences [6] Market Outlook - The light medical aesthetic market in China is expected to reach around RMB 340 billion by 2030, with So-Young targeting a 25% market share [20] - Current penetration in China is below 5%, indicating substantial growth potential compared to mature markets like South Korea [20] Future Expansion Plans - Long-term goal to achieve 1,000 centers within 8-10 years, with a phased approach to expansion [18][19] - Plans to pilot two to three franchise centers in Q4 2025, with future expansion pace dependent on pilot performance [19] Cost Structure and Efficiency - Average customer acquisition cost remains low, with a focus on private domain traffic and referrals [21] - R&D expenses decreased by 26.6% to RMB 31.2 million, attributed to improved staff efficiency [14] Product Strategy - Focus on anti-aging treatments and a curated product portfolio to drive repeat business and positive referrals [26][27] - Plans to introduce new light-based treatments and injectable products, enhancing the product pipeline [22][23] Conclusion So-Young's strategic shift towards aesthetic centers has resulted in significant revenue growth, despite overall revenue declines in other segments. The company is well-positioned for future expansion in the rapidly growing medical aesthetics market in China, with a focus on quality service delivery, customer acquisition efficiency, and a robust product portfolio.