NaaS Technology (NAAS) Q3 2024 earnings summary

Executive summary

• Achieved first-ever positive non-IFRS net profit of RMB 20.6 million in Q3 2024, with IFRS net loss narrowing to RMB 8.3 million.

• Charging services revenue grew 36% year-over-year, now representing 95% of total revenue.

• Gross margin reached a record 57% in Q3 2024, marking four consecutive quarters of improvement.

• Strategic focus shifted to high-growth, high-margin core charging services and AI-driven technology, phasing out low-margin energy solutions.

• Significant cost reductions achieved by discontinuing low-margin offline businesses and optimizing operations.

Financial highlights

• Total revenues were RMB 44.4 million, down 55% year-over-year due to exit from low-margin energy solutions.

• Charging services revenue reached RMB 42.4 million, up 36% year-over-year.

• Gross profit was RMB 25.2 million, with gross margin at 57%.

• Sales expenses decreased by 81% year-over-year and 41.7% quarter-over-quarter.

• Non-IFRS net profit attributable to shareholders was RMB 21.2 million, compared to a non-IFRS net loss of RMB 175.7 million last year.

Outlook and guidance

• Priorities for Q4 2024 and FY2025 include profitability, scale, and technology, with continued focus on interconnectivity charging services and leveraging economies of scale.

• Management expects continued growth in charging services and further efficiency gains from AI-driven technology and network effects.