Income from Operations up 33.3% Year Over Year

BEIJING, June 4, 2025 /PRNewswire/ -- Scienjoy Holding Corporation ("Scienjoy", the "Company", or "we") $(SJ)$, an interactive entertainment leader in the Chinese market, today announced its financial results for the first quarter ended March 31, 2025.

First Quarter 2025 Operating and Financial Summaries

   -- 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. 
 
   -- 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. Gross margin increased to 19.4% in the first quarter of 2025 from 
      16.8% 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. 
 
   -- 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. 
 
   -- 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. 
 
   -- As of March 31, 2025, the Company had RMB286.5 million (US$39.5 million) 
      in cash and cash equivalents, which represented an increase of RMB33.9 
      million from RMB252.5 million as of December 31, 2024. 

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."

First Quarter 2025 Financial Results

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.

   -- Sales and marketing expenses increased by 6.3% to RMB2.1 million (US$0.3 
      million) in the first quarter of 2025 from RMB2.0 million in the same 
      period of 2024, primarily attributable to more marketing activities. 
 
   -- General and administrative expenses increased by 17.2% to RMB23.4 million 
      (US$3.2 million) in the first quarter of 2025 from RMB19.9 million in the 
      same period of 2024. The increase was primarily due to an increase of 
      RMB3.8 million in professional consultant fee. 
 
   -- Research and development expenses decreased to RMB19.6 million (US$2.7 
      million) in the first quarter of 2025 from RMB21.5 million in the same 
      period of 2024, due to a decrease of RMB2.4 million in technical service 
      fee. 
 
   -- Provision for credit losses was RMB0.8 million (US$0.1 million) in the 
      first quarter of 2025, as compared to a recovery of credit losses of 
      RMB0.6 million in the same period of 2024, due to slow collection. 

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.

About Scienjoy Holding Corporation

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/.

Use of Non-GAAP Financial Measures

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.

For more information on these non-GAAP financial measures, please see the table captioned "Reconciliations of Non-GAAP Results" near the end of this release.

Exchange Rate Information

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.

Safe Harbor Statement

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.

For investor and media inquiries, please contact:

Investor Relations Contacts

Denny Tang

Chief Financial Officer

Scienjoy Holding Corporation

+86-10-64428188

ir@scienjoy.com

Ascent Investor Relations LLC

Tina Xiao

+1-646-932-7242

investors@ascent-ir.com

 
       UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS 
(All amounts in thousands, except share and per share data or 
                      otherwise stated) 
 
                              As of              As of 
                           December 31,         March 31, 
                          --------------  -------------------- 
                               2024         2025      2025 
                          --------------  ---------  ------- 
                               RMB           RMB       US$ 
                          --------------  ---------  ------- 
ASSETS 
Current assets 
Cash and cash equivalents        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 
Property and equipment, 
 net                               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 
Accounts payable                  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 
Deferred tax 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, 
respectively. 
39,078,340 Class A 
ordinary   shares and 
2,925,058 Class B 
ordinary shares issued 
and outstanding   as of 
March 31, 2025, 
respectively. 
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 
                           =============  =========  ======= 
 
 
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND 
                  COMPREHENSIVE INCOME (LOSS) 
(All amounts in thousands, except share and per share data or 
                      otherwise stated) 
 
                               For three months ended 
                         ----------------------------------- 
                          March 31,   March 31,   March 31, 
                         -----------  ----------  ---------- 
                            2024         2025        2025 
                         -----------  ----------  ---------- 
                             RMB         RMB         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 
 noncontrolling 
   interest                  (3,774)     (3,868)       $(533.SI)$ 
                          ----------  ----------  ---------- 
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  41,563,935 
                          ==========  ==========  ========== 
Diluted                   41,164,872  41,563,935  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,    March 31,  March 31, 
                          ------------  ---------  --------- 
                              2024        2025       2025 
                          ------------  ---------  --------- 
                              RMB          RMB        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.

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SOURCE Scienjoy Holding Corporation

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June 04, 2025 08:00 ET (12:00 GMT)