On August 28, Beijing time, Quantum Song (NASDAQ: QSG) announced its unaudited financial results for the fourth quarter and full year of fiscal year 2024 ("Q4 2024" refers to the period from April 1, 2024 to June 30, 2024; "Q4 2024" refers to the period from July 1, 2023 to June 30, 2024).
According to the financial report, the total revenue for the year reached 3.8 billion yuan, a year-on-year increase of 23.2%; The total revenue for the fourth quarter was 1 billion yuan, a year-on-year increase of 20.7%; Adjusted net profit has been profitable for seven consecutive quarters, and profitability has continued to improve. Quantum Song users continue to maintain high-quality growth. As of June 30, 2024, the total number of registered users of Quantum Song has reached 127.6 million.
The board of directors of the company has approved a new phase of stock repurchase plan, which will repurchase up to $20 million worth of stocks within 12 months starting from June 11, 2024. This measure reflects the management's confidence in the market and the future of the company.
Li Peng, founder and chairman of Quantum Song Group, said, "Thanks to the steady growth of our core business and the continuous improvement of operational efficiency, Quantum Song achieved the best total revenue, net profit and other core indicators in history this year. Guided by the focus on the silver economy industry and the company's new mission and vision, we continue to deepen our cultivation in the silver economy field, creating more convenient and rich service experiences for more users; we continue to work together with industry partners to create a new ecosystem of silver economy services, and use practical actions to help the high-quality development of the silver economy industry
Deepen strategic priorities
Empowering Silver Hair Economy Blue Ocean
Vigorously developing the silver economy is an important strategic direction to actively respond to population aging. In June 2024, Quantum Song released the "White Paper on the Middle aged and Elderly Service Market", which showed that the size of China's middle-aged and elderly consumer market exceeded 14 trillion yuan and is expected to maintain a strong growth trend in the next five years. With the process of population aging, its diversified and high-level demands are driving the industry to expand into broader and deeper fields.
In this macro context, with its profound accumulation in the field of elderly and middle-aged services, Quantum Song has released its new mission of "assisting in a beautiful and long-lasting life" and new vision of "becoming the most beloved and trusted long-term partner of adults". It highly integrates the market demand of the silver economy with the company's experience advantages, and clearly focuses on serving the silver economy, achieving initial results.
The company combines interests with knowledge and offers a variety of online courses such as calligraphy classes and traditional health preservation techniques like the Eight Section Brocade; Offline launch of study tour products, innovatively combining online interest courses with offline tourism services, providing a more diversified service experience for the silver haired group. In addition, the company has accurately positioned the middle-aged and elderly health consumer goods market, with a GMV of nearly 33.6 million yuan in the fourth quarter, a month on month growth of up to 83.3%. This clearly indicates that the company is transforming towards serving the silver haired economy sector, responding to user demand and supporting industry development.
Improving core business quality
Accelerate and increase the volume of innovative business
In the fiscal year 2024, Quantum Song achieved a total revenue of 3.8 billion yuan, a year-on-year increase of 23.2%, thanks to high-quality and practical online learning courses. Specifically, the revenue from personal online learning services reached 3.36 billion yuan, a year-on-year increase of 23.0%. Among them, skill enhancement courses and entertainment and leisure courses contributed 1.66 billion yuan and 400 million yuan in revenue respectively, both achieving a year-on-year growth of over double. The overall profitability has improved, with a net profit of 390 million yuan for the whole year; Adjusted net profit increased by 410.2% year-on-year, reaching 420 million yuan, with profit growth rate higher than revenue growth rate.
In terms of business expansion, the consumer business utilizes existing live streaming platforms for cross selling consumer products, achieving a scale revenue of 174 million yuan for the entire fiscal year 2024. In the future, the consumer business will focus on its own brand products to meet the comprehensive needs of users; The GMV of health products for middle-aged and elderly people increased significantly by 83.3% month on month, from 18.32 million yuan in the third quarter to 33.58 million yuan in the fourth quarter. In addition, the offline consumption and service sectors continue to expand, and the "2024 Thousand Foot Cup Calligraphy Competition" held in August attracted nearly a hundred students to participate; The study tour program has expanded to multiple routes including Beijing, Wudang Mountain, and Shanghai. The company is also actively exploring offline centers as hubs for socializing and learning, developing blended online and offline courses to meet the diverse needs of the silver haired population.
At the same time, the company has also set its sights on the international market. The establishment of the Quantum Song Hong Kong office marks a solid step in its globalization strategy, aiming to introduce advanced concepts and experiences from overseas and promote excellent Chinese products and services to the world. Quantum Song fully acquires Kelly's Education, a Hong Kong online language learning platform, as a window to explore the international market, allowing the company to gain a foothold in the broader education market.
Optimize product strategy
Building a silver haired economic ecosystem
The company continues to build a diversified growth curve, optimize product strategies and resource allocation, ensuring close alignment with the consumption needs of middle-aged and elderly people. As of June 30, 2024, the company's cash and cash equivalents, restricted cash, and short-term investments amounted to 1.026 billion yuan. This robust financial foundation provides strong support for the company's flexible transition to a silver economy while maintaining operational stability.
In the future, the company will continuously enrich the content and forms of courses, consolidate the potential of silver online education, and expand offline consumption and service scenarios; Actively promoting self owned brand consumer goods, meeting the diverse needs of middle-aged and elderly users through live streaming e-commerce, offline stores and other diversified channels, helping users achieve the vision of a better life of "learning and enjoying the elderly", and collaborating with the industry to create a silver haired economic ecosystem.
The strategic shift of Quantum Song's mainland business towards the silver economy is a solid foundation for the company's natural evolution and long-term value creation. Looking ahead to the development prospects of the 2025 fiscal year, Li Peng said, "We will persist in deepening the field of silver economy, devote ourselves to creating long-term value, continuously innovate services, improve products, and create a better life experience for more middle-aged and elderly users, and use practical actions to help the high-quality development of the silver economy industry