RLX Technology Reports Strong Financial Results for Q4 and Fiscal Year 2024

RLX Technology's Impressive Financial Performance in Q4 and Fiscal Year 2024

RLX Technology Inc. (NYSE: RLX), a leading player in the global e-vapor market, has announced its financial results for the fourth quarter and the entire fiscal year ending December 31, 2024. This period marks a significant upward trajectory for the company, showcasing resilience and strategic growth despite industry challenges.

Q4 2024 Financial Highlights

In Q4 2024, RLX Technology reported net revenues of RMB 813.5 million (approximately USD 111.4 million), a remarkable increase from RMB 520.5 million in the same quarter of the previous year. This surge can be attributed primarily to the company’s robust international expansion strategy. The gross margin for this quarter stood at 27.0%, slightly up from 23.7% in Q4 2023, signifying improved profitability.

U.S. GAAP net income was RMB 127.4 million (USD 17.5 million) for Q4 2024, reflecting a decrease compared to RMB 216.0 million in the same quarter of the last year. However, on a non-GAAP basis, net income was RMB 251.5 million (USD 34.5 million), down from RMB 432.6 million the previous year, indicating the impact of market dynamics on the company's earnings.

Full Year 2024 Overview

For the entire fiscal year of 2024, RLX Technology's net revenues soared to RMB 2,748.6 million (USD 376.6 million), growing from RMB 1,586.4 million in 2023. This marks an impressive increase of 73.3% year-over-year, reflecting the growing demand for e-vapor products globally and strategic market positioning.

The company also noted a gross margin increase to 26.4%, compared to 24.4% the prior year, showcasing effective cost optimization strategies. Notably, the U.S. GAAP net income climbed slightly to RMB 564.3 million (USD 77.3 million) from RMB 541.0 million in the previous year. On a non-GAAP basis, net income reached RMB 934 million (USD 128 million), an increase from RMB 903.9 million a year ago.

Management's Insights

According to Ms. Ying (Kate) Wang, CEO and Co-founder of RLX Technology, 2024 was a transformational year characterized by significant enhancements in their global operations. The company has not only upgraded its organizational structure but also refined its business models to cater to the diverse needs of international markets. The launch of innovative open-system and disposable e-vapor products has set new trends and reaffirmed their commitment to harm-reduction practices in the industry.

Chao Lu, the Chief Financial Officer, emphasized that the company’s focus on global expansion is a key contributor to their outstanding performance. They successfully reported a sequential rise in non-GAAP operating profit for four consecutive quarters, marking a significant return to profitability in 2024. Lu also mentioned the steps taken to return value to shareholders through share repurchase programs and dividend payments.

Operational Metrics and Future Outlook

In Q4, RLX Technology's operational expenses decreased to RMB 231.5 million (USD 31.7 million) from RMB 263.9 million, highlighting the company's effective cost management measures. Additionally, their cash and cash equivalents rose to RMB 15,870.8 million (USD 2,174.3 million) by the end of December 2024, enhancing their liquidity and financial stability.

The road ahead seems promising as RLX Technology intends to continue emphasizing innovation and compliance while diversifying its product offerings. With a focus on capturing new market opportunities in 2025, the company aims to keep its leadership position intact within the evolving e-vapor sector.

In summary, RLX Technology’s financial results for Q4 and fiscal year 2024 indicate remarkable growth and solid strategic planning, reaffirming its commitment to innovation and shareholder value. As the company navigates through the fast-changing landscape of the e-vapor industry, its proactive measures place it in a strong position to harness future growth potential.