FAST NEWS: Waterdrop posts sixth consecutive quarterly profit

The latest: Online insurer Waterdrop Inc. (WDH.US) on Thursday reported a 21.7 million yuan ($2.95 million) net profit in the second quarter, its sixth consecutive quarterly profit.

Looking up: The company’s insurance marketplace generated first-year premiums of 2.2 billion yuan in the second quarter, up 29.8% from the previous quarter.

Take Note: The company’s second-quarter revenue rose 12% sequentially to 679 million yuan. But its second-quarter 21.7 million yuan net profit was down 56.3% from the previous quarter, mainly due to a 64.13 million yuan operating loss for its crowdfunding business.

Digging Deeper: Waterdrop was founded in 2016 by Meituan (3690.HK) co-founder Shen Peng and listed in New York in May 2021. Its businesses include internet platforms for insurance, crowdfunding and new drug R&D services. After operating for most of its life in the red in China’s fiercely competitive insurance market, the company started implementing cost control measures in late 2021 to bring down its selling, administrative and R&D expenses. It was able to swing to the black through those efforts, reporting profits since the first quarter of last year.

Market Reaction: Waterdrop shares fell 4% to $1.46 on Thursday in New York. The stock now trades at the lower end of its 52-week range.

Translation by A. Au

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