So-Young Doubles User Base But Halves Revenues
The information-sharing platform in China eyes a healthier Q2.
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Belinda Zhou
May 19,2020,06:55

Chinese plastic surgery promoter So-Young International Inc. (Nasdaq: SY) reported better than expected top-line growth in the first quarter on Monday, but it didn’t help to boost its stock price due to the half-cut revenue.

The Beijing-based plastic surgery information provider announced today that it earned $25.8 million in the first quarter, which slightly exceeded the company high end of its revenue guidance of $25.7 million. Its net loss in the first quarter $5.1 million, compared to its net income of $6.6 million in the corresponding period one year ago. 

The year-over-year revenue decrease is 11%, while its quarter-over-quarter drop hit 49%, as So-Young reported. “The decline was primarily due to the outbreak of COVID-19 which curtailed medical service providers’ spending and required end-customers to shelter in place which delayed the demand in the first quarter of 2020,” So-Young said in the statement.

CapitalWatch columnist Donovan Jones said in his report that interested investors should be cautious with So-Young's next report, which will probably include no financial impact from the coronavirus outbreak. Q1 2020's results were downright terrible as the coronavirus outbreak halted demand for aesthetic treatments in China.

So-Young said it boosted its user base. The average mobile monthly active users were 4.17 million on the platform, up 117% from 1.92 million in the same period of 2019.

“We are using a series of creative and incentivizing promotion plans, working more closely with medical aesthetic influencers to generate valuable content,” Xing Jin, the chief executive officer of So-Young, said in the statement.

The company added paying medical service providers to 3,295 by 22% from one year ago, while the number of medical service providers subscribing to information services reached 1,862 from 1,853 in 2019.

The company increased its revenue guidance for the second quarter to between $45 million and $49 million, representing 12% to 23% increase year-over-year. 

China’s authorities were encouraging internet-based healthcare, supporting with Healthy China 2030 strategy which announced by President Xi in 2016.

Data company QuestMobile said in April, So-Young ranked first with over 9.66 million monthly active users in the sector of mobile healthcare apps. So-Young was followed by Pingan Good Doctor developed by Hong Kong-listed Ping An Healthcare and Technology Company Ltd. (HKEX: 01833) and DXY.cn, an online community for physicians, health care professionals, pharmacies and facilities backed by Tencent Holdings Limited (HKEX: 0700). 

Shares in So-Young were trading at $11.10 per share, up 1% midday Monday. So-Young went public on May 2 in 2019 in New York and raised $180 million.


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