FAST NEWS: Keep Inc. reports small revenue growth as loss narrows
The Latest: Online fitness platform Keep Inc. (3650.HK) announced Friday its non-GAAP adjusted loss in the first half of this year narrowed to 160 million yuan ($22.5 million) from 223 million yuan a year earlier.
Looking Up: The company’s revenue grew by 5.4% to 1.04 billion yuan during the period, primarily on improving monetization across its self-branded products, online membership subscriptions, and advertising sales. As that improved, its gross margin also rose from 43% to 46%.
Take Note: The company’s selling and marketing expenses increased by 25.8% to 323 million yuan, mainly due to higher promotional and advertising spending with the launch of more brand promotions and marketing campaigns.
Digging Deeper: Keep was founded in 2015 as a provider of online fitness programs with its own structured classes. It went on to conduct eight financing rounds, raising over $600 million in total as it attained a valuation of over $2 billion. It initially planned to list in the U.S. in 2021, but decided to switch to Hong Kong as China’s securities regulator tightened its supervision of overseas listings. It was approved to list in Hong Kong after its third application and debuted on the Hong Kong Stock Exchange in July last year.
Market Reaction: Keep’s shares fell sharply on Monday, closing down 15.1% at HK$6.02 by the midday break. The stock now trades nearly 80% lower than last year’s IPO price of HK$28.92.
Translation by A. Au
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