Beike's first-quarter revenue fell by 19.2% year-on-year, and net profit fell by 84.3% year-on-year | Financial Report Insights

Ke Holdings' first-quarter financial report is mixed, with total transaction volume, revenue, and net profit all significantly declining. However, the number of active stores and monthly active users has slightly increased, with revenue from housing rental services nearly doubling year-on-year.

On Thursday, May 23, Ke Holdings released its first-quarter financial report for 2024:

In the first quarter, the total transaction volume was RMB 629.9 billion, a year-on-year decrease of 35.2%; revenue was RMB 16.4 billion, a year-on-year decrease of 19.2%; gross profit was RMB 4.1 billion, a year-on-year decrease of 35.1%; gross margin was 25.2%, down 6.1 percentage points from the same period in 2023. Net profit for the first quarter was RMB 0.432 billion, a year-on-year decrease of 84.29%; adjusted net profit was RMB 1.392 billion, a year-on-year decrease of 60.91%.

As of the end of the first quarter, Ke Holdings had 44,200 stores, an increase of 7.1% from the same period last year, with approximately 42,600 active stores, a 7.5% year-on-year increase. The number of agents was 442,700, an increase of 1.6% from the same period last year, with approximately 399,200 active agents, a 3.0% decrease from the same period last year. The average number of monthly active users on mobile in the first quarter was 47.7 million, compared to 45.4 million in the same period in 2023.

After the data was released, Ke Holdings' US stocks fell 2% in pre-market trading.

Significant Decline in New Home and Second-hand Home Transaction Volume and Revenue, First Disclosure of Rental Housing Performance

In the first quarter, the total transaction volume was RMB 629.9 billion, a year-on-year decrease of 35.2%. Both new home and second-hand home transaction volumes saw significant declines:

Second-hand home transaction volume was RMB 453.2 billion, a year-on-year decrease of 31.8%;

New home transaction volume was RMB 151.8 billion, a year-on-year decrease of 45.4%;

The total output value of home decoration was RMB 3.4 billion, a year-on-year increase of 26.1%;

The total output value of emerging and other services was RMB 21.5 billion, a year-on-year decrease of 19.3%.

In the first quarter, revenue was RMB 16.4 billion, a year-on-year decrease of 19.2%. Looking at the business segments, revenue from new homes and second-hand homes both saw significant declines, while revenue from housing rental services nearly doubled year-on-year:

Net revenue from second-hand home transaction services was RMB 5.7 billion, a year-on-year decrease of 37.6%;

Net revenue from new home transaction services was RMB 4.9 billion, a year-on-year decrease of 41.5%;

Net revenue from home decoration and furniture was RMB 2.4 billion, a year-on-year increase of 71.1%;

Net revenue from housing rental services was RMB 2.6 billion, a year-on-year increase of 189.3%;

Net revenue from emerging services and other services was RMB 0.7 billion, compared to RMB 0.4 billion in the same period in 2023.

During the reporting period, the contract amount for Ke Holdings' home decoration and home furnishing business reached RMB 3.39 billion, with net income of RMB 2.41 billion, a year-on-year increase of 71.1%. Performance data for housing rental services was disclosed for the first time, with net income of RMB 2.63 billion. **In the first quarter, Beike's non-real estate transaction service revenue increased by 112.9% year-on-year, further increasing its share to 35%.

Revenue cost decreased by 12% year-on-year, while marketing expenses increased by 26%.

The total revenue cost in the first quarter was 12.3 billion yuan, a 12.0% decrease compared to 13.9 billion yuan in the same period in 2023.

Total operating expenses were 4.1 billion yuan, a 21.9% increase compared to 3.4 billion yuan in the same period in 2023. Among them:

General and administrative expenses were 2.019 billion yuan, a 24.5% increase compared to 1.621 billion yuan in the same period in 2023.

Sales and marketing expenses were 1.624 billion yuan, a 25.5% increase compared to 1.294 billion yuan in the same period in 2023.

Research and development expenses were 0.467 billion yuan, basically flat compared to 0.457 billion yuan in the same period in 2023