Boqii Holding(US:BQ)2022-09-15 18:15Financial Data and Key Metrics Changes - Total revenue for Q1 2023 slightly decreased by 2.1% to RMB315.1 million, primarily due to a 2.7% decline in product sales revenue [14] - Revenue from higher margin online marketing and information services increased by 14.7% to RMB11.9 million [14] - Gross profit increased from RMB56.4 million to RMB17.7 million, up 25.3% year-over-year, with gross profit margin enhancing by 419 basis points to 22.4% [15] - Net loss narrowed significantly by 66.8% year-over-year to RMB12.4 million, marking the best quarter so far [9][17] - Non-GAAP net loss narrowed by 66.7% year-over-year to RMB10.5 million [17] Business Line Data and Key Metrics Changes - Private label revenue increased by 27.3% year-over-year, demonstrating the company's ability to respond to market needs [8] - High margin online marketing and information services reported a 14.7% year-over-year growth in revenue [7] - Fulfillment expenses increased slightly from 10.2% of revenue last year to 11.8% this quarter due to supply chain disruptions [15] Market Data and Key Metrics Changes - The number of brands on the platform increased by 14.1% to 745 from 653 in the same period last year [11] - SKU count rose by 25.9% from 22,732 to 28,620 [11] - Active users increased by 11.4% year-over-year and 20.8% quarter-over-quarter to 1.83 million [11] Company Strategy and Development Direction - The company aims to become an end-to-end connector between brand partners and pet parents, expanding its offerings and community [10] - Focus on enhancing big data analytics capabilities to identify market trends and capture opportunities [7] - Plans to increase the proportion of private labels, which have a higher gross margin compared to non-private labels [22][28] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing challenges from COVID-19 affecting supply chain and logistics but remains committed to growth [6] - The company expects the gross margin to reach 30% in the future, driven by an increase in third-party revenue and private labels [22][28] - The pet market in China is expected to grow significantly, providing ample space for the company to capture market share [10] Other Important Information - The company ended the quarter with cash, cash equivalents, and short-term investments of RMB247.4 million, indicating a solid financial position [18] - The company engaged in community support activities, including donations to pet care centers [19] Q&A Session Summary Question: Future gross margin expectations - Management expects gross margin to reach 30% in the future, driven by increased third-party revenue and private labels [22] Question: Spending trends between members and non-members - Spending of members is about twice that of non-members this quarter [25] Question: Supply chain challenges and procurement of international brands - Management noted that the supply chain for overseas brands has not significantly recovered, and they plan to substitute with private labels and domestic brands [27]