Revenue Dip, Cost-Cutting Success, Eyeing H2 Recovery

Published: 8/26/2024

Author: FRC Analysts

*See important disclosures at the bottom of this report

Sector: Technology | Industry: Consumer Electronics

Ticker Symbols:

ZEPP - NYSE 🔹

Rating and Key Data

Subscribe for free to get exclusive insights and data.

In Q2-2024, revenue was down 56% YoY, missing our estimate by 22% due to lower than anticipated unit sales. EBITDA remained negative, but improved due to higher gross margins, and lower operating expenses.
Revenue declined due to the discontinuation of several low-margin products, with new product launches skewed toward H2-2024, combined with softer global demand for smartwatches, and stronger competition.

Sources indicate that global smartwatch shipments declined by 9% YoY in Q2 amid slower global GDP growth. Additionally, average product pricing fell due to discounts driven by excess supply.

Rating and Key Data