-- Maintained Quarterly Operational Profitability
-- Operating Expenses as a Percentage of Revenues Decreased 20 Basis
Points YoY
-- Maintained Positive Operating Cash Flow in the First Half of the Year
SHANGHAI, Sept. 17, 2025 /PRNewswire/ -- 111, Inc. ("111" or the "Company") $(YI)$, a leading tech-enabled healthcare platform company committed to reshaping the value chain of healthcare industry by digitally empowering the upstream and downstream in China, today announced its unaudited financial results for the second quarter ended June 30, 2025.
Second Quarter 2025 Highlights
-- Total operating expenses were RMB185.3 million (US$25.9 million), an
improvement of 9.3% compared to RMB204.3 million in the same quarter of
last year. As a percentage of net revenues, total operating expenses
decreased by 20 basis points to 5.8% from 6.0% in the same quarter of
last year, demonstrating continuous improvement in the Company's
operational efficiency.
-- Income from operations was RMB0.1 million (US$0.01 million), compared to
RMB3.3 million in the same quarter of last year. As a percentage of net
revenues, income from operations accounted for 0.003% this quarter as
compared to 0.1% in the same quarter of last year.
-- Non-GAAP income from operations (1) was RMB3.0 million (US$0.4 million),
compared to RMB8.5 million in the same quarter of last year. As a
percentage of net revenues, Non-GAAP income from operations accounted for
0.1% this quarter as compared to 0.2% in the same quarter of last year.
(1) (Non-GAAP income from operations represents income from operations
excluding share-based compensation expenses.)
Mr. Junling Liu, Co-Founder, Chairman, and Chief Executive Officer of 111, commented, "In the second quarter of 2025, we continued to navigate a challenging macroeconomic landscape, demonstrating the resilience of our business and our unwavering commitment to operational excellence. I am pleased to report that we sustained our operational profitability and maintained a positive operating cash flow for the first half of the year. Our disciplined approach to cost management and efficiency improvements is evident in the 9.3% year-over-year reduction in total operating expenses, which, as a percentage of net revenues, decreased by 20 basis points to 5.8%."
"Our strategic initiatives are yielding significant results. Marketing promotional products quickly reach pharmacies nationwide through the 111 digital marketing platform. Marketing promotional products related sales revenue increased by 53.6%, customer count increased by 19.0% YoY. This success underscores our unique capability to digitally empower our upstream partners. Furthermore, our general agency business model is gaining strong momentum. As the general distributor for a first-tier original research anti-infection drug among small and medium-sized chains, customer numbers and sales volume continue to grow monthly. Monthly sales volume rapidly increased to over seven times what it was when the project launched in Q1."
"We have also made substantial progress in strengthening our supply chain capabilities through our 'MANTIANXING' initiative. By the end of Q2, fulfillment centers expanded to 19 locations nationwide. The project generated an inventory value of 355 million RMB in Q2, with GMV increasing by 58.2% compared to Q1."
"Looking ahead, our strategy remains centered on leveraging technology to empower the healthcare value chain. We will continue to invest in AI and digital solutions to optimize our supply chain, deepen customer engagement, and solidify our position as a leader in the tech-enabled healthcare space. Our solid performance this quarter, despite market headwinds, reinforces our confidence in our ability to execute our long-term vision and create sustainable value for our shareholders."
Second Quarter 2025 Financial Results
Net revenues were RMB3.2 billion (US$447.5 million), representing a decrease of 6.4% from RMB3.4 billion in the same quarter of last year.
Gross segment profit (2) was RMB185.4 million (US$25.9 million), representing a decrease of 10.7% from RMB207.6 million in the same quarter of last year.
(In thousands RMB) For the three months ended June 30,
---------------------------------------
2024 2025 YoY
------------- ------------- ---------
B2B Net Revenue
Product 3,328,249 3,122,073 -6.2 %
Service 25,270 20,838 -17.5 %
------------- ------------- ---------
Sub-Total 3,353,519 3,142,911 -6.3 %
============= ============= =========
Cost of Products Sold(3) 3,162,928 2,970,558 -6.1 %
------------- ------------- ---------
Segment Profit 190,591 172,353 -9.6 %
============= ============= =========
Segment Profit % 5.7 % 5.5 %
============= ============= =========
(In thousands RMB) For the three months ended June 30,
---------------------------------------
2024 2025 YoY
------------ ----------- ------------
B2C Net Revenue
Product 65,480 59,584 -9.0 %
Service 5,371 3,265 -39.2 %
------------ ----------- ------------
Sub-Total 70,851 62,849 -11.3 %
============ =========== ============
Cost of Products Sold 53,844 49,822 -7.5 %
------------ ----------- ------------
Segment Profit 17,007 13,027 -23.4 %
------------ ----------- ------------
Segment Profit % 24.0 % 20.7 %
============ =========== ============
(2) Gross segment profit represents net revenues less cost of goods sold.
(3) For segment reporting purposes, purchase rebates are allocated to the B2B
segment and B2C segments primarily based on the amount of cost of products
sold for each segment. Cost of products sold does not include other direct
costs related to cost of product sales such as shipping and handling expense,
payroll and benefits of logistic staff, logistic centers rental expenses and
depreciation expenses, which are recorded in the fulfillment expenses. Cost of
service revenue is recorded in the operating expense.
Operating costs and expenses were RMB3.2 billion (US$447.5 million), representing a decrease of 6.3% from RMB3.4 billion in the same quarter of last year, broadly in line with the decline in net revenues.
-- Cost of products sold was RMB3.0 billion (US$421.6 million), representing
a decrease of 6.1% from RMB3.2 billion in the same quarter of last year.
-- Fulfillment expenses were RMB90.2 million (US$12.6 million), representing
an increase of 2.4% from RMB88.1 million in the same quarter of last
year. Fulfillment expenses accounted for 2.8% of net revenues this
quarter as compared to 2.6% in the same quarter of last year.
-- Selling and marketing expenses were RMB66.2 million (US$9.2 million),
representing a decrease of 17.7% from RMB80.4 million in the same quarter
of last year. Excluding the share-based compensation expenses of RMB1.1
million for the quarter and RMB1.7 million for the same quarter last year,
respectively, selling and marketing expenses as a percentage of net
revenues accounted for 2.0% in the quarter as compared to 2.3% in the
same quarter of last year.
-- General and administrative expenses were RMB17.4 million (US$2.4 million),
representing an increase of 0.6% from RMB17.3 million in the same quarter
of last year. Excluding the share-based compensation expenses of RMB1.6
million for the quarter and RMB2.5 million for the same quarter last year,
respectively, general and administrative expenses as a percentage of net
revenues accounted for 0.5% this quarter as compared to 0.4% in the same
quarter of last year.
-- Technology expenses were RMB14.9 million (US$2.1 million), representing a
decrease of 19.0% from RMB18.4 million in the same quarter of last year.
Excluding the share-based compensation expenses of RMB0.2 million for the
quarter and RMB1.0 million for the same quarter last year, respectively,
technology expenses as a percentage of net revenues accounted for 0.5%
this quarter, maintaining the same as last year.
Income from operations was RMB0.1 million (US$0.01 million), compared to RMB3.3 million in the same quarter of last year.
Non-GAAP income from operations was RMB3.0 million (US$0.4 million), compared to RMB8.5 million in the same quarter of last year. As a percentage of net revenues, non-GAAP income from operations accounted for 0.1% this quarter as compared to 0.2% in the same quarter of last year.
Net loss was RMB7.3 million (US$1.0 million), compared to RMB2.1 million in the same quarter of last year. As a percentage of net revenues, net loss accounted for 0.2% this quarter as compared to 0.1% in the same quarter of last year.
Non-GAAP net loss (4) was RMB4.4 million (US$0.6 million), compared to non-GAAP net income of RMB3.1 million in the same quarter of last year.
(MORE TO FOLLOW) Dow Jones Newswires
September 17, 2025 02:00 ET (06:00 GMT)