Huize(HUIZ) - 2025 Q2 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Total revenue reached RMB400 million, a three-year quarterly high, representing a 40% year-over-year increase [4][16] - Net profit for the quarter was approximately RMB11 million, with non-GAAP net profit at RMB8 million [16] - Gross written premiums facilitated on the platform grew 34% year-over-year to RMB1.8 billion, while first-year premiums increased by 73% year-over-year to RMB1.13 billion [5][16] - The expense to revenue ratio improved by 16.6 percentage points year-over-year to 23.9% [9][20] Business Line Data and Key Metrics Changes - Long-term insurance products accounted for over 90% of total gross written premiums facilitated, with first-year premiums from long-term savings products more than doubling year-over-year to RMB864 million [17][18] - Short-term insurance business recorded a 19% year-over-year growth in gross written premiums, reaching approximately RMB140 million [7] - The average first-year premium ticket size for long-term products increased by 57% year-over-year to RMB7,600 [6] Market Data and Key Metrics Changes - Cumulative insurance users exceeded 11.4 million, with approximately 400,000 new clients added during the quarter [5][18] - In Vietnam, the subsidiary Global Care recorded a 32% year-over-year increase in both gross written premiums and revenue [11][20] - Active platform users in Global Care increased by 52%, while the average ticket size on the B2A to C business line tripled sequentially [20] Company Strategy and Development Direction - The company is focused on a customer-centric approach, evolving product offerings to meet customer needs and partnering with industry leaders [4] - AI initiatives are being rolled out across the company to enhance operational efficiency and customer engagement [9][10] - The company aims to expand its ecosystem in Southeast Asia, leveraging local partnerships to capture long-term opportunities [14][22] Management's Comments on Operating Environment and Future Outlook - The management noted strong momentum in China's insurance industry, driven by rising needs in health, retirement, and wealth management [13] - AI is seen as a core growth engine, enhancing customer experience and reducing operating costs [13] - The company expects continued sequential growth in the distribution of participating products in the second half of the year [32] Other Important Information - The company has established a private AI large language model and local application development platform to promote in-house AI agent development [19] - The company has secured a financial adviser and exempt insurance broker license from the Monetary Authority of Singapore, marking a significant milestone in Southeast Asia expansion [11][21] Q&A Session Summary Question: Insights on enhancing professional capabilities in selling participating insurance and sales performance guidance - Management highlighted ongoing training for agents and collaboration with insurers to develop customized savings products, expecting continued growth in participating product distribution [26][29][32] Question: Leveraging AI technology for product sales and efficiency - Management discussed the integration of AI in customer acquisition and underwriting, enhancing product recommendations and customer relationship management [27][33][34] Question: Impact of regulatory changes on overseas business and sales momentum - Management acknowledged regulatory changes affecting sales in Hong Kong but expects continued demand for offshore products due to interest rate differentials [36][38] Question: Net profit outlook for the full year - Management expressed confidence in sequential improvement in net profit, particularly in Q3, while continuing to invest in business growth [41][42] Question: Gross margin performance and sustainability - Management noted stabilization of gross margin at around 27%, expecting it to remain stable in the coming quarters [44][48] Question: Demand for health and protection products - Management reported a 24% sequential growth in first-year premiums for health and protection products, indicating steady growth in this segment [50]