#China #Beijing #Waterdrop Inc. #Medical Crowdfunding #Insurance Marketplace

Waterdrop Inc. Reports Remarkable Q3 2024 Financial Results

Waterdrop Inc. (NYSE: WDH), a pioneer in the insurance and healthcare service technology landscape, unveiled its unaudited financial results for the third quarter and nine months expired September 30, 2024. With a clear demonstration of robust growth, the report reveals increased profitability and expansion in key areas of the business, underscoring the company's positive social impact.

Key Highlights

Profitability

In an impressive turn of events, Waterdrop recorded a net profit of RMB 92.8 million for the third quarter, showcasing a staggering year-over-year growth of 152.6%. This profitability is attributed to enhanced operational efficiency and continuous positive cash flow management. As of September 30, 2024, the company maintained a healthy liquidity position, positioning it well for sustainable growth.

Insurance Business Growth

Waterdrop's insurance segment also experienced strong performance during the quarter, with first-year premiums (FYP) reaching RMB 2,041.8 million (approximately US$290.9 million), marking a 20.4% year-over-year increase. The net operating revenue rose to RMB 704.1 million (US$100.3 million), reflecting a 2.6% year-over-year uptick. Notably, the insurance business maintained an operating profit margin above 20%, indicating effective cost management and successful customer acquisition strategies.

Crowdfunding and Patient Recruitment

In the realm of medical crowdfunding, Waterdrop has cemented its status as a leading platform. By the end of September 2024, approximately 466 million individuals contributed an aggregate of RMB 66.3 billion to support over 3.32 million patients. The company also demonstrated its reliability in clinical trial recruitment, successfully enrolling over 9,500 patients in 1,137 programs through its E-Find Platform.

Technological Advancements

Mr. Peng Shen, founder and CEO, highlighted the advancements in their AI capabilities. The introduction of an AI Consultant, powered by Waterdrop's own large language model, has been pivotal in driving customer engagement, generating substantial revenue from user queries. Furthermore, the company outlined its strategic move in digital clinical trial solutions, witnessing a notable 17.4% revenue increase quarter-over-quarter through collaboration with pharmaceutical companies.

Financial Breakdown

Revenue Growth

• - Operating Revenue: Increased to RMB 704.1 million from RMB 686.5 million year-over-year.
• - Insurance-Related Income: Reported at RMB 600.7 million, slightly down by 3.0% compared to last year, primarily due to declines in technical service income.
• - Crowdfunding Service Fees: Jumped 83.0% year-over-year to RMB 65.8 million, showcasing demand for crowdfunding assistance.
• - Digital Clinical Trial Solutions: Revenue reached RMB 24.3 million, a 12.1% decrease year-over-year, but marked an increase of 17.4% relevant to the previous quarter.

Operational Cost Management

Despite increased operational expenses associated with scaling aspects of the business, Waterdrop successfully managed and improved its cost structure with a 1.6% year-over-year reduction in total costs to RMB 677.7 million. Notably, sales and marketing expenditures were trimmed by 7.7% year-over-year, indicative of efficiency in spending as the firm focuses on impactful marketing avenues.

Shareholder Engagement

Waterdrop also continued its shareholder-friendly practices by repurchasing around 50.9 million American Depositary Shares (ADSs) valued at approximately US$102.3 million, reiterating its commitment to enhancing shareholder value. The company also distributed a special cash dividend of around US$7.3 million, further underlining its strategic focus on delivering returns to investors.

Outlook

Looking ahead, Waterdrop Inc. remains optimistic about its growth trajectory. The support provided by recent regulatory measures intends to bolster transparency and management within the crowdfunding sector. Exciting advancements in AI technology and an unwavering focus on expanding its insurance and medical services indicate robust prospects for continued profitability.

In summation, Waterdrop's Q3 financial report indicates a solid foundation for future growth and a commitment to transforming the insurance and healthcare landscape through technology-driven solutions. As the company pushes forward in enhancing its services, stakeholders can be assured of Waterdrop's persistence in making a positive social impact while achieving substantial growth.