Financial News

KANZHUN LIMITED Announces First Quarter 2023 Financial Results

BEIJING, May 24, 2023 (GLOBE NEWSWIRE) -- KANZHUN LIMITED (“BOSS Zhipin” or the “Company”) (Nasdaq: BZ; HKEX: 2076), a leading online recruitment platform in China, today announced its unaudited financial results for the quarter ended March 31, 2023.

First Quarter 2023 Highlights

  • Revenues for the first quarter of 2023 were RMB1,277.5 million (US$186.0 million), an increase of 12.3% from RMB1,137.9 million for the same quarter of 2022.
  • Calculated cash billings1 for the first quarter of 2023 were RMB1,649.6 million (US$240.2 million), an increase of 27.7% from RMB1,291.5 million for the same quarter of 2022.
  • Average monthly active users (MAU)2 for the first quarter of 2023 were 39.7 million, an increase of 57.5% from 25.2 million for the same quarter of 2022.
  • Total paid enterprise customers3 in the twelve months ended March 31, 2023 were 4.0 million, on par with that in the twelve months ended March 31, 2022.
  • Net income for the first quarter of 2023 was RMB32.7 million (US$4.8 million), compared to a net loss of RMB12.2 million for the same quarter of 2022. Adjusted net income4 for the first quarter of 2023 was RMB245.0 million (US$35.7 million), an increase of 102.3% from RMB121.1 million for the same quarter of 2022.

Mr. Jonathan Peng Zhao, Founder, Chairman and Chief Executive Officer of the Company, commented, “We are pleased to deliver a strong quarter with revenue growth starting to re-accelerate, driven by robust user growth and a rebound of recruitment demand post-spring festival. Our MAU, revenues, calculated cash billings and multiple other key metrics hit record highs in the quarter. We are confident to maintain this growth momentum and continue delivering solid results in the coming quarters.”

Mr. Phil Yu Zhang, Chief Financial Officer, added, “Our adjusted net income reached RMB245.0 million, representing a 102.3% year-on-year growth, despite the fact that the first quarter is normally a high season for marketing expenses related to strong user growth. This solid profitability mainly resulted from our enhanced brand recognition and improved marketing efficiency, which we also believe will drive our sustainable and quality growth.”

_____________________

1 Calculated cash billings is a non-GAAP financial measure, derived by adding the change in deferred revenue to revenues. For more information on the non-GAAP financial measures, please see the section of “Non-GAAP Financial Measures.”
2 Monthly active users refer to the number of verified user accounts, including both job seekers and enterprise users, that logged on to our mobile application in a given month at least once.
3 Paid enterprise customers are defined as enterprise users and company accounts from which we recognize revenues for our online recruitment services.
4 Adjusted net income/loss and adjusted basic and diluted net income/loss per ADS attributable to ordinary shareholders are non-GAAP financial measures, excluding the impact of share-based compensation expenses. For more information on the non-GAAP financial measures, please see the section of “Non-GAAP Financial Measures.”

First Quarter 2023 Financial Results

Revenues

Revenues were RMB1,277.5 million (US$186.0 million) for the first quarter of 2023, representing an increase of 12.3% from RMB1,137.9 million for the same period in 2022.

  • Revenues from online recruitment services to enterprise customers were RMB1,260.1 million (US$183.5 million) for the first quarter of 2023, representing an increase of 11.8% from RMB1,127.3 million for the same period in 2022. This increase was mainly driven by the user growth and recovery of recruitment demand after spring festival.
  • Revenues from other services, which mainly comprise paid value-added services offered to job seekers, were RMB17.5 million (US$2.5 million) for the first quarter of 2023, representing an increase of 65.1% from RMB10.6 million for the same period in 2022, mainly benefiting from expanded user base.

Operating cost and expenses

Total operating cost and expenses were RMB1,373.7 million (US$200.0 million) for the first quarter of 2023, representing an increase of 19.9% from RMB1,146.1 million for the same period of 2022. Total share-based compensation expenses were RMB212.3 million (US$30.9 million) for the first quarter of 2023, representing an increase of 59.4% from RMB133.2 million for the same period of 2022.

  • Cost of revenues was RMB247.2 million (US$36.0 million) for the first quarter of 2023, representing an increase of 39.4% from RMB177.3 million for the same period of 2022, primarily due to increases in server and bandwidth cost and payment processing cost.
  • Sales and marketing expenses were RMB628.8 million (US$91.6 million) for the first quarter of 2023, representing an increase of 20.4% from RMB522.4 million for the same period of 2022, primarily due to increases in expenses related to sales employee compensations and user acquisition.
  • Research and development expenses were RMB333.1 million (US$48.5 million) for the first quarter of 2023, representing an increase of 14.6% from RMB290.7 million for the same period of 2022, primarily due to an increase in share-based compensation expenses.
  • General and administrative expenses were RMB164.6 million (US$24.0 million) for the first quarter of 2023, representing an increase of 5.7% from RMB155.7 million for the same period of 2022, primarily due to an increase in share-based compensation expenses.

Loss from operations

Loss from operations was RMB77.3 million (US$11.3 million) for the first quarter of 2023, compared to RMB3.3 million for the same period of 2022.

Net income/loss and adjusted net income

Net income was RMB32.7 million (US$4.8 million) for the first quarter of 2023, compared to a net loss of RMB12.2 million for the same period of 2022.

Adjusted net income was RMB245.0 million (US$35.7 million) for the first quarter of 2023, representing an increase of 102.3% from RMB121.1 million for the same quarter of 2022.

Net income/loss per ADS and adjusted net income per ADS

Basic and diluted net income per ADS attributable to ordinary shareholders for the first quarter of 2023 were RMB0.08 (US$0.01) and RMB0.07 (US$0.01), respectively, compared to basic and diluted net loss per ADS of RMB0.03 in the same period of 2022.

Adjusted basic and diluted net income per ADS attributable to ordinary shareholders4 for the first quarter of 2023 were RMB0.57 (US$0.08) and RMB0.54 (US$0.08), respectively, compared to adjusted basic and diluted net income per ADS of RMB0.28 and RMB0.26, respectively, in the same period of 2022.

Net cash provided by operating activities

Net cash provided by operating activities was RMB543.9 million (US$79.2 million) in the first quarter of 2023, representing an increase of 85.0% from RMB294.0 million in the same period of 2022.

Cash position

Balance of cash and cash equivalents and short-term investments was RMB13,456.1 million (US$1,959.4 million) as of March 31, 2023.

Share Repurchase Program

In March 2023, the Company’s board of directors authorized a new share repurchase program under which the Company may repurchase up to US$150 million of its shares (including in the form of ADSs) over the next 12 months.

Outlook

For the second quarter of 2023, the Company currently expects its total revenues to be between RMB1.43 billion and RMB1.46 billion, representing a year-on-year increase of 28.6% to 31.3%. This forecast reflects the Company’s current views on the market and operational conditions in China, which are subject to change and cannot be predicted with reasonable accuracy as of the date hereof.

Conference Call Information

The Company will host a conference call at 8:00AM U.S. Eastern Time on Wednesday, May 24, 2023 (8:00PM Beijing Time on Wednesday, May 24, 2023) to discuss the financial results.

Participants are required to pre-register for the conference call at:
https://register.vevent.com/register/BI046c9777bdf4411b8a395b15e5c64a31 

Upon registration, participants will receive an email containing participant dial-in numbers and unique personal PIN. This information will allow you to gain immediate access to the call. Participants may pre-register at any time, including up to and after the call start time.

Additionally, a live and archived webcast of the conference call will be available on the Company's investor relations website at https://ir.zhipin.com.

Exchange Rate

This announcement contains translations of certain RMB amounts into U.S. dollar (“US$”) amounts at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to US$ were made at the exchange rate of RMB6.8676 to US$1.00 on March 31, 2023 as set forth in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or US$ amounts referred could be converted into US$ or RMB, as the case may be, at any particular rate or at all.

Non-GAAP Financial Measures

In evaluating the business, the Company considers and uses non-GAAP financial measures, such as calculated cash billings, adjusted net income/loss, adjusted net income/loss attributable to ordinary shareholders, adjusted basic and diluted net income/loss per ordinary share attributable to ordinary shareholders and adjusted basic and diluted net income/loss per ADS attributable to ordinary shareholders as supplemental measures to review and assess operating performance. The Company derives calculated cash billings by adding the change in deferred revenue to revenues. The Company uses calculated cash billings to measure and monitor sales growth because the Company generally bills its paid enterprise customers at the time of sales, but may recognize a portion of the related revenue ratably over time. The Company believes calculated cash billings provides valuable insights into the cash generated from sales and is a valuable measure for monitoring service demand and financial performance. The Company defines adjusted net income/loss and adjusted net income/loss attributable to ordinary shareholders by excluding the impact of share-based compensation expenses, which are non-cash expenses, from the related GAAP financial measures. The Company believes that these non-GAAP financial measures help identify underlying trends in the business that could otherwise be distorted by the effect of certain expenses and facilitate investors’ assessment of the Company’s operating performance.

The non-GAAP financial measures are not defined under U.S. GAAP, and are not presented in accordance with U.S. GAAP. The non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for most directly comparable GAAP financial measures. The Company encourages investors and others to review its financial information in its entirety and not rely on a single financial measure.

A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures has been provided in the table captioned “Unaudited Reconciliation of GAAP and Non-GAAP Results” at the end of this press release.

Safe Harbor Statement

This press release contains statements that may constitute “forward-looking” statements which are made pursuant to the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “aims,” “future,” “intends,” “plans,” “believes,” “estimates,” “likely to,” and similar statements. The Company may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission, in announcements made on the website of The Stock Exchange of Hong Kong Limited, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about the Company’s beliefs, plans, and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. Further information regarding these and other risks is included in the Company’s filings with the U.S. Securities and Exchange Commission and The Stock Exchange of Hong Kong Limited. All information provided in this press release is as of the date of this press release, and the Company does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

About KANZHUN LIMITED

KANZHUN LIMITED operates the leading online recruitment platform BOSS Zhipin in China. The Company connects job seekers and enterprise users in an efficient and seamless manner through its highly interactive mobile app, a transformative product that promotes two-way communication, focuses on intelligent recommendations, and creates new scenarios in the online recruiting process. Benefiting from its large and diverse user base, BOSS Zhipin has developed powerful network effects to deliver higher recruitment efficiency and drive rapid expansion.

For investor and media inquiries, please contact:

KANZHUN LIMITED
Investor Relations
Email: ir@kanzhun.com 

PIACENTE FINANCIAL COMMUNICATIONS
Email: kanzhun@tpg-ir.com 

KANZHUN LIMITED
Unaudited Condensed Consolidated Statements of Comprehensive Loss
(All amounts in thousands, except for share and per share data)
 
  For the three months ended March 31,
  2022  2023
  RMB RMB US$
Revenues      
Online recruitment services to enterprise customers 1,127,318  1,260,057  183,479 
Others 10,562  17,489  2,547 
Total revenues 1,137,880   1,277,546    186,026  
Operating cost and expenses      
Cost of revenues(1) (177,348) (247,164) (35,990)
Sales and marketing expenses(1) (522,374) (628,838) (91,566)
Research and development expenses(1) (290,739) (333,068) (48,498)
General and administrative expenses(1) (155,687) (164,586) (23,966)
Total operating cost and expenses (1,146,148)  (1,373,656)  (200,020)
Other operating income, net 5,009  18,811  2,739 
Loss from operations (3,259)  (77,299)  (11,255)
Investment income 9,274  51,611  7,515 
Financial income, net 3,677  75,782  11,035 
Foreign exchange loss (442) (1,099) (160)
Other (expenses)/income, net (8,854) 5,642  822 
Income before income tax expenses 396   54,637    7,957  
Income tax expenses (12,568) (21,974) (3,200)
Net (loss)/income (12,172)  32,663    4,757  
Net (loss)/income attributable to ordinary shareholders (12,172)  32,663    4,757  
       
Net (loss)/income (12,172)  32,663    4,757  
Other comprehensive loss      
Foreign currency translation adjustments (44,243) (139,928) (20,375)
Total comprehensive loss (56,415)  (107,265)  (15,618)
       
Weighted average number of ordinary shares      
—Basic 869,631,088  865,986,168  865,986,168 
—Diluted 869,631,088  907,404,032  907,404,032 
Net (loss)/income per ordinary share attributable to ordinary shareholders      
—Basic (0.01) 0.04  0.01 
—Diluted (0.01) 0.04  0.01 
Net (loss)/income per ADS* attributable to ordinary shareholders      
—Basic (0.03) 0.08  0.01 
—Diluted (0.03) 0.07  0.01 
          

* Each ADS represents two Class A ordinary shares.

(1) Include share-based compensation expenses as follows:

  For the three months ended March 31,
  2022 2023
  RMB RMB US$
Cost of revenues 7,719 10,610 1,545
Sales and marketing expenses 29,330 60,463 8,804
Research and development expenses 57,415 90,674 13,203
General and administrative expenses 38,762 50,544 7,360
  133,226  212,291   30,912
       


KANZHUN LIMITED
Unaudited Condensed Consolidated Balance Sheets
(All amounts in thousands)
 
  As of
  December 31,
2022
 March 31, 2023
  RMB RMB US$
ASSETS      
Current assets      
Cash and cash equivalents 9,751,824  6,254,572  910,736 
Short-term investments 3,458,089  7,201,542  1,048,626 
Accounts receivable, net 9,862  13,236  1,927 
Amounts due from related parties 5,714  11,167  1,626 
Prepayments and other current assets 600,773  476,080  69,323 
Total current assets 13,826,262   13,956,597    2,032,238  
Non-current assets      
Property, equipment and software, net 691,036  749,414  109,123 
Intangible assets, net 10,251  9,712  1,414 
Goodwill 5,690  5,690  829 
Right-of-use assets, net 289,628  279,463  40,693 
Other non-current assets 4,000  4,000  582 
Total non-current assets  1,000,605    1,048,279    152,641  
Total assets 14,826,867   15,004,876    2,184,879  
LIABILITIES AND SHAREHOLDERS’ EQUITY      
Current liabilities      
Accounts payable 185,297  108,925  15,861 
Deferred revenue 2,060,892  2,432,903  354,258 
Other payables and accrued liabilities 633,482  393,122  57,243 
Operating lease liabilities, current 151,438  150,458  21,908 
Total current liabilities  3,031,109    3,085,408    449,270  
Non-current liabilities      
Operating lease liabilities, non-current 143,591  124,963  18,196 
Deferred tax liabilities 11,404  27,099  3,946 
Total non-current liabilities  154,995    152,062    22,142  
Total liabilities  3,186,104    3,237,470    471,412  
Shareholders’ equity      
Ordinary shares 564  564  82 
Treasury shares (918,894) (918,892) (133,801)
Additional paid-in capital 15,450,389  15,684,295  2,283,810 
Accumulated other comprehensive income 695,184  555,256  80,852 
Accumulated deficit (3,586,480) (3,553,817) (517,476)
Total shareholders’ equity 11,640,763   11,767,406    1,713,467  
Total liabilities and shareholders’ equity 14,826,867   15,004,876    2,184,879  
          


KANZHUN LIMITED
Unaudited Condensed Consolidated Statements of Cash Flows
(All amounts in thousands)
  For the three months ended March 31,
  2022 2023
  RMB RMB US$
Net cash provided by operating activities 294,011  543,910  79,199 
Net cash used in investing activities (243,519) (3,962,775) (577,025)
Net cash provided by financing activities 9,104  45,789  6,667 
Effect of exchange rate changes on cash and cash equivalents (44,671) (124,176) (18,081)
Net increase/(decrease) in cash and cash equivalents 14,925  (3,497,252) (509,240)
Cash and cash equivalents at beginning of the period 11,341,758  9,751,824  1,419,976 
Cash and cash equivalents at end of the period 11,356,683  6,254,572  910,736 
          


KANZHUN LIMITED
Unaudited Reconciliation of GAAP and Non-GAAP Results
(All amounts in thousands, except for share and per share data)
 
  For the three months ended March 31,
  2022  2023
  RMB RMB US$
Revenues 1,137,880  1,277,546 186,026
Add: Change in deferred revenue 153,640  372,011 54,169
Calculated cash billings 1,291,520   1,649,557   240,195
       
Net (loss)/income (12,172) 32,663 4,757
Add: Share-based compensation expenses 133,226  212,291 30,912
Adjusted net income 121,054   244,954   35,669
       
Net (loss)/income attributable to ordinary shareholders (12,172) 32,663 4,757
Add: Share-based compensation expenses 133,226  212,291 30,912
Adjusted net income attributable to ordinary shareholders 121,054   244,954   35,669
Weighted average number of ordinary shares (non-GAAP)      
—Basic 869,631,088  865,986,168 865,986,168
—Diluted 922,626,236  907,404,032 907,404,032
Adjusted net income per ordinary share attributable to ordinary shareholders      
—Basic 0.14  0.28 0.04
—Diluted 0.13  0.27 0.04
Adjusted net income per ADS attributable to ordinary shareholders      
—Basic 0.28  0.57 0.08
—Diluted 0.26  0.54 0.08
        

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