1. Scienjoy's Q1 2025 revenues decreased 2.8% year-over-year. 2. Gross profit increased 12.1%, improving gross margin to 19.4%. 3. Income from operations surged 33.3%, despite a net loss of RMB 13 million. 4. Cash reserves rose by RMB 33.9 million, indicating financial stability. 5. Company anticipates future growth through global expansion and operational excellence.
Though gross profit increased, overall revenues declined. Net losses may deter investor confidence.
The article provides key insights into financial performance, affecting investor sentiment. Strategic comments imply future potential but current losses may lead to concerns.
Immediate quarterly performance may impact stock price. Long-term effects depend on strategic execution.
BEIJING, June 4, 2025 /PRNewswire/ -- Scienjoy Holding Corporation ("Scienjoy", the "Company", or "we") (NASDAQ: SJ), an interactive entertainment leader in the Chinese market, today announced its financial results for the first quarter ended March 31, 2025.
Mr. Victor He, Chairman and Chief Executive Officer of Scienjoy, commented, "Our first quarter results reflect our continued focus on operational efficiency and strategic cost management. Despite a slight decline in total revenues, we achieved a substantial increase in gross profit and gross margin. These results underscore our unwavering commitment to executing our long-term growth strategy, particularly advancing our global expansion through our Dubai hub and continuing to scale in the dynamic Middle East and beyond. Our Dubai subsidiary has established a strong foundation for our dual model in the AI sector, combining a compelling AI-focused app with a growing user base and a complementary offline presence that not only generates revenue but also serves as a marketing funnel. The momentum from late 2024 through the first quarter of 2025 reflects strong execution in this strategy and lays a solid platform for further global expansion in subsequent quarters. Moving forward, we remain confident in our ability to drive operational excellence, scale globally, and remain agile in response to market dynamics. With clear objectives in place, we believe we are well-positioned for sustainable long-term shareholder value creation."
Mr. Denny Tang, Chief Financial Officer of Scienjoy, added, "We are encouraged by the resilience of our business in the first quarter of 2025. Our income from operations increased by 33.3% year over year, demonstrating the ongoing effectiveness of our disciplined cost management and our capability to extract greater value from a more targeted paying user base. Although we reported a net loss this quarter, the strength of our core operations was not impacted, as evidenced by the significant increases in both income from operations and gross profit. Additionally, the increase in cash reserves reinforces our financial stability and ability to support future sustainable growth. We believe the progress we have achieved in fiscal year 2024 has laid a solid foundation for continued momentum in 2025. Looking ahead, we will remain focused on executing our strategic priorities while advancing our innovation roadmap, with renewed confidence and resolution to pursue high-quality growth and operational efficiency."
Total revenues decreased to RMB307.3 million (US$42.4 million) in the first quarter of 2025 from RMB316.3 million in the same period of 2024, primarily caused by a decrease in paying users due to competitive landscape of China's mobile live streaming market. Total paying users were 151,971 in the first quarter of 2025, as compared to 164,044 in the same period of 2024.
Cost of revenues decreased to RMB247.8 million (US$34.2 million) in the first quarter of 2025 from RMB263.2 million in the same period of 2024. The decrease was primarily attributable to a decrease of RMB22.9 million in the Company's revenue sharing fees due to the fact that the Company already had a stable market share, offset by an increase of RMB7.0 million in the Company's user acquisition costs.
Gross profit increased by 12.1% to RMB59.5 million (US$8.2 million) in the first quarter of 2025 from RMB53.1 million in the same period of 2024. The gross margin increased to 19.4% in the first quarter of 2025 from 16.8% in the same period of 2024 due to higher average live streaming revenue per paying user ("ARPPU") during the first quarter of 2025, showing the Company's effectiveness in converting high-quality paying user to its profit growth.
Total operating expenses increased by 7.0% to RMB45.8 million (US$6.3 million) in the first quarter of 2025 from RMB42.8 million in the same period of 2024.
Income from operations increased by 33.3% to RMB13.7 million (US$1.9 million) in the first quarter of 2025 from RMB10.3 million in the same period of 2024.
Change in fair value of investment in marketable security increased by 654.1% to loss of RMB24.3 million (US$3.4 million) in the first quarter of 2025 from loss of RMB3.2 million in the same period of 2024. The change was primarily attributable to the fair value changes in investments in a publicly traded company.
Investment loss decreased to RMB0.4 million (US$0.1 million) in the first quarter of 2025, as compared to an investment loss of RMB2.2 million in the same period of 2024. The investment loss was primarily attributable to share of unrealized loss in long-term investments.
Net loss was RMB13.0 million (US$1.8 million) in the first quarter of 2025, as compared to a net income of RMB2.8 million in the same period of 2024. Despite delivering a 33.3% increase in income from operation, the Company reported a net loss for the first quarter of 2025, primarily attributable to an unrealized loss of RMB 24.3 million from change in fair value of investment in marketable security.
Net loss attributable to the Company's shareholders was RMB9.1 million (US$1.3 million) in the first quarter of 2025, as compared to a net income attributable to the Company's shareholders of RMB6.6 million in the same period of 2024.
Adjusted net loss attributable to the Company's shareholders was RMB5.5 million (US$0.8 million) in the first quarter of 2025, as compared to a net income adjusted attributable to the Company's shareholders of RMB9.0 million in the same period of 2024.
Basic and diluted net loss attributable to the Company's shareholders per ordinary share were both RMB0.22 (US$0.03) in the first quarter of 2025. In comparison, basic and diluted net income attributable to the Company's shareholders per ordinary share were both RMB0.16 in the same period of 2024.
Adjusted basic and diluted net loss attributable to the Company's shareholders per ordinary share were both RMB0.13 (US$0.02) in the first quarter of 2025. In comparison, adjusted basic and diluted net income attributable to the Company's shareholders per ordinary share were both RMB0.22 in the same period of 2024.
As of March 31, 2025, the Company had cash and cash equivalent balance of RMB286.5 million (US$39.5 million), which represented an increase of RMB33.9 million from RMB252.5 million as of December 31, 2024.
Scienjoy is a pioneering Nasdaq-listed interactive entertainment leader. Driven by the vision of shaping a metaverse lifestyle, Scienjoy leverages AI-powered technology to create immersive experiences that resonate with global audiences, fostering meaningful connections and redefining entertainment. For more information, please visit http://ir.scienjoy.com/.
Adjusted net income is calculated as net income adjusted for change in fair value of contingent consideration, change in fair value of warrant liability and share based compensation. Adjusted basic and diluted net income per ordinary share is non-GAAP net income (loss) attributable to ordinary shareholders divided by weighted average number of ordinary shares used in the calculation of non-GAAP basic and diluted net income per ordinary share. The non-GAAP financial measures are presented to enhance investors' overall understanding of the Company's financial performance and should not be considered a substitute for, or superior to, the financial information prepared and presented in accordance with U.S. GAAP. Investors are encouraged to review the reconciliation of the historical non-GAAP financial measures to its most directly comparable GAAP financial measures. As non-GAAP financial measures have material limitations as analytical metrics and may not be calculated in the same manner by all companies, they may not be comparable to other similarly titled measures used by other companies. In light of the foregoing limitations, you should not consider non-GAAP financial measures as a substitute for, or superior to, such metrics in accordance with US GAAP.
This announcement contains translations of certain RMB amounts into U.S. dollars at a specified rate solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to U.S. dollars are made at a rate of RMB7.2567 to US$1.00, the noon buying rate in effect on March 31, 2025, in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB amounts could have been, or could be, converted, realized or settled in U.S. dollars at that rate on March 31, 2025, or at any other rate.
Certain statements made in this release are "forward looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. When used in this press release, the words "estimates," "projected," "expects," "anticipates," "forecasts," "plans," "intends," "believes," "seeks," "may," "will," "should," "future," "propose" and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the Company's control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Important factors, among others, are: the ability to manage growth; ability to identify and integrate other future acquisitions; ability to obtain additional financing in the future to fund capital expenditures; fluctuations in general economic and business conditions; costs or other factors adversely affecting our profitability; litigation involving patents, intellectual property, and other matters; potential changes in the legislative and regulatory environment; a pandemic or epidemic. The forward-looking statements contained in this release are also subject to other risks and uncertainties, including those more fully described in the Company's filings with the Securities and Exchange Commission ("SEC") from time to time. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. Such information speaks only as of the date of this release.
Denny Tang
Chief Financial Officer
Scienjoy Holding Corporation
+86-10-64428188
[email protected]
Ascent Investor Relations LLC
Tina Xiao
+1-646-932-7242
[email protected]
(All amounts in thousands, except share and per share data or otherwise stated)
| As of | December 31, 2024 | As of March 31, 2025 | US$ |
|---|---|---|---|
| ASSETS | |||
| Current assets | 252,540 | 286,482 | 39,478 |
| Accounts receivable, net | 226,060 | 208,242 | 28,697 |
| Prepaid expenses and other current assets | 28,415 | 30,424 | 4,193 |
| Amounts due from related parties | - | 100 | 14 |
| Investment in marketable security | 37,629 | 13,295 | 1,832 |
| Total current assets | 544,644 | 538,543 | 74,214 |
| Non-current assets | 1,981 | 1,839 | 253 |
| Intangible assets, net | 405,256 | 403,519 | 55,606 |
| Goodwill | 182,661 | 182,619 | 25,166 |
| Long term investments | 257,387 | 256,890 | 35,400 |
| Long term deposits and other assets | 906 | 906 | 125 |
| Right-of-use assets-operating lease | 4,845 | 19,614 | 2,703 |
| Deferred tax assets | 7,505 | 7,600 | 1,047 |
| Total non-current assets | 860,541 | 872,987 | 120,300 |
| TOTAL ASSETS | 1,405,185 | 1,411,530 | 194,514 |
| LIABILITIES AND EQUITY | |||
| Current liabilities | 36,015 | 29,623 | 4,079 |
| Accrued salary and employee benefits | 22,346 | 24,367 | 3,358 |
| Accrued expenses and other current liabilities | 6,840 | 9,585 | 1,321 |
| Income tax payable | 11,284 | 12,960 | 1,786 |
| Lease liabilities-operating lease -current | 4,098 | 5,693 | 785 |
| Deferred revenue | 80,186 | 82,276 | 11,338 |
| Total current liabilities | 160,769 | 164,504 | 22,667 |
| Non-current liabilities | 58,400 | 58,045 | 7,999 |
| Lease liabilities-operating lease -non-current | 700 | 12,725 | 1,754 |
| Total non-current liabilities | 59,100 | 70,770 | 9,753 |
| TOTAL LIABILITIES | 219,869 | 235,274 | 32,420 |
| Commitments and contingencies | |||
| EQUITY | |||
| Ordinary share, no par value, unlimited Class A ordinary shares and Class B ordinary shares authorized | 38,922,726 Class A ordinary shares and 2,925,058 Class B ordinary shares issued and outstanding as of December 31, 2024 | 39,078,340 Class A ordinary shares and 2,925,058 Class B ordinary shares issued and outstanding as of March 31, 2025 | |
| Class A ordinary shares | 444,162 | 447,737 | 61,700 |
| Class B ordinary shares | 23,896 | 23,896 | 3,293 |
| Shares to be issued | 20,817 | 20,817 | 2,869 |
| Treasury stocks | (19,952) | (19,952) | (2,749) |
| Statutory reserves | 50,705 | 51,326 | 7,073 |
| Retained earnings | 662,499 | 652,788 | 89,957 |
| Accumulated other comprehensive income | 16,967 | 17,339 | 2,389 |
| Total shareholders' equity | 1,199,094 | 1,193,951 | 164,532 |
| Non-controlling interests | (13,778) | (17,695) | (2,438) |
| Total equity | 1,185,316 | 1,176,256 | 162,094 |
| TOTAL LIABILITIES AND EQUITY | 1,405,185 | 1,411,530 | 194,514 |
(All amounts in thousands, except share and per share data or otherwise stated)
| For three months ended | March 31, 2024 | March 31, 2025 | US$ | |
|---|---|---|---|---|
| Live streaming - consumable virtual items revenue | 309,015 | 294,474 | 40,580 | |
| Live streaming - time-based virtual item revenue | 5,974 | 4,858 | 669 | |
| Technical services and others | 1,310 | 8,003 | 1,103 | |
| Total revenue | 316,299 | 307,335 | 42,352 | |
| Cost of revenues | (263,212) | (247,842) | (34,154) | |
| Gross profit | 53,087 | 59,493 | 8,198 | |
| Sales and marketing expenses | (1,988) | (2,113) | (291) | |
| General and administrative expenses | (19,930) | (23,352) | (3,218) | |
| Research and development expenses | (21,527) | (19,562) | (2,696) | |
| Recovery of (provision for) credit losses | 643 | (754) | (102) | |
| Income from operations | 10,285 | 13,712 | 1,891 | |
| Change in fair value of investment in marketable security | (3,227) | (24,334) | (3,353) | |
| Investments loss | (2,240) | (412) | (57) | |
| Interest income, net | 1,979 | 539 | 74 | |
| Other income, net | 113 | 1,433 | 197 | |
| Foreign exchange (loss) gain, net | 534 | (1,016) | (140) | |
| Income (loss) before income taxes | 7,444 | (10,078) | (1,388) | |
| Income tax expense | (4,638) | (2,880) | (397) | |
| Net income (loss) | 2,806 | (12,958) | (1,785) | |
| Less: net loss attributable to non-controlling interest | (3,774) | (3,868) | (533) | |
| Net income (loss) attributable to the Company's shareholders | 6,580 | (9,090) | (1,252) | |
| Other comprehensive income (loss): | ||||
| Other comprehensive (loss) income - foreign currency translation adjustment | (436) | 323 | 45 | |
| Comprehensive income (loss) | 2,370 | (12,635) | (1,740) | |
| Less: comprehensive loss attributable to non- controlling interests | (3,774) | (3,917) | (533) | |
| Comprehensive income (loss) attributable to the Company's shareholders | 6,144 | (8,718) | (1,207) | |
| Weighted average number of shares | Basic | 41,164,872 | 41,563,935 | |
| Diluted | 41,164,872 | 41,563,935 | ||
| Earnings (loss) per share | Basic | 0.16 | (0.22) | (0.03) |
| Diluted | 0.16 | (0.22) | (0.03) | |
| Reconciliations of Non-GAAP Results | ||||
| All amounts in thousands, except share and per share data or otherwise stated | ||||
| For the three months ended | March 31, 2024 | March 31, 2025 | US$ | |
| Net income (loss) attributable to the Company's shareholders | 6,580 | (9,090) | (1,252) | |
| Less: | Share based compensation | (2,435) | (3,575) | (493) |
| Adjusted net income (loss) attributable to the Company's shareholders | 9,015 | (5,515) | (759) | |
| Adjusted net income (loss) per ordinary share | Basic | 0.22 | (0.13) | (0.02) |
| Diluted | 0.22 | (0.13) | (0.02) | |
| "Adjusted net income (loss) attributable to the Company's shareholders" is defined as net income (loss) attributable to the Company's shareholders excluding share based compensation. For more information, refer to "Use of Non-GAAP Financial Measures" and "Reconciliations of Non-GAAP Results" at the end of this press release. |