Yunji Inc ((YJ)) has held its Q2 earnings call. Read on for the main highlights of the call.
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Yunji Inc’s recent earnings call revealed a mixed sentiment, highlighting both achievements and challenges. The company celebrated successful product launches and brand expansion, yet faced financial hurdles with declining revenue and increased net loss. The strategic initiatives show promise but are juxtaposed against a backdrop of financial difficulties.
Successful Launch of Youjiang Organic Milk
Yunji Inc’s health-focused brand awareness received a boost with the successful launch of Youjiang Organic Milk, which achieved RMB 5 million in sales. This launch marks a significant step in the company’s strategy to establish itself in the health-conscious consumer market.
Strong Performance of Major Products
The company’s major products, including slimming coffee, probiotics, and freeze-dried sea buckthorn powder, demonstrated strong sales performance. Slimming coffee alone achieved sales of over RMB 10 million, showcasing Yunji’s ability to capture consumer interest in health-related products.
Growth in SUYE Beauty Brand
Yunji’s SUYE beauty brand also saw impressive growth, with the PRO-XLANE FIRMING ESSENCE LOTION generating over RMB 4 million in sales at launch. The entire SUYE series reached sales exceeding RMB 10 million, indicating a strong market presence in the beauty sector.
Expansion of Public Domain Channels
The company made strides in expanding its public domain channels by enhancing its Tmall infrastructure and partnering with influencers. Yunji’s WeChat channel transaction volume now ranks higher than 92% of its peers, reflecting successful digital marketing strategies.
Jianxin Tea Therapy Business Expansion
Yunji’s Jianxin Tea Therapy business has expanded significantly, achieving a 100% tea therapy team with a 50% participation rate. The program has successfully attracted high net worth individuals, broadening its customer base.
Revenue Decline
Despite these successes, Yunji faced a revenue decline, with total revenue decreasing to RMB 158.3 million from RMB 233.8 million a year ago. This decline was primarily attributed to softer consumer confidence and strategic product selection refinement.
Increased Net Loss
The company’s financial challenges were further highlighted by an increased net loss of RMB 100.7 million, compared to a net loss of RMB 8 million a year ago. Adjusted net loss also rose significantly, indicating financial strain.
Increased Operating Expenses
Yunji’s operating expenses increased to RMB 179.4 million, up from RMB 149.1 million in the same period of 2024. This rise was driven by significant increases in general and administrative expenses, impacting the company’s profitability.
Forward-Looking Guidance
CEO Shanglue Xiao emphasized Yunji’s commitment to an organic health strategy amidst challenging market conditions and declining consumer confidence. The company aims to optimize cost structures and improve profitability, with a focus on establishing future growth prospects through successful product launches and maintaining a strong cash position of RMB 217.1 million.
In summary, Yunji Inc’s earnings call presented a complex picture of achievements and challenges. While the company celebrated successful product launches and brand expansions, it faced significant financial difficulties with declining revenue and increased net loss. The strategic initiatives show promise, and the company’s commitment to an organic health strategy offers a hopeful outlook for future growth.