Zepp Health (ZEPP) investor relations material

Executive summary

• Q2 2026 revenue reached $63.5 million, up 6.9% year-over-year, driven by new product launches and a shift toward higher-value product segments, despite higher memory and component costs.

• Gross margin for Q2 2026 was 37.4%, up 120 basis points year-over-year, reflecting a stronger premium product mix.

• Net loss attributable to the company was $11.3 million, compared to $7.7 million in Q2 2025, as higher revenue and margin were offset by FX headwinds and increased R&D and marketing spend.

• Cash and cash equivalents stood at $106.3 million as of June 30, 2026, up from $95.3 million a year earlier, reflecting improved working capital management.

• Product launches spanned professional running, hybrid training, entry-level smartwatches, and screen-free wearables.

Financial highlights

• Q2 2026 revenue was $63.5 million, up 6.9% year-over-year, with gross profit at $23.7 million.

• Gross margin improved to 37.4% from 36.2% a year ago.

• Adjusted operating expenses rose to $34.8 million, mainly due to higher selling and marketing costs and foreign currency impacts.

• Adjusted operating loss was $11.1 million in Q2 2026; adjusted net loss was $12.5 million.

• Cash and cash equivalents: $106.3 million as of Q2 2026; inventory: $62.4 million, down from $79.9 million year-over-year.

Outlook and guidance

• Q3 2026 revenue is expected between $68 million and $73 million, a year-over-year decline of 4%-10% due to a high comparison base and ongoing supply constraints.

• Full supply for Helio Strap and Bip is anticipated in Q4, supporting a return to growth.

• Selling expenses are expected to moderate in H2 as the pace of new product launches slows.

• Management remains focused on expanding premium product contribution, improving unit economics, and disciplined cost control.

• Product mix and demand improved in July and August, but supply and channel cycles will delay full revenue impact.