XD (2400) H1 2024 earnings summary

Executive summary

• Revenue rose 26.7% year-over-year to RMB2,220.6 million for the six months ended June 30, 2024, driven by new self-developed game launches, platform growth, and cost control measures.

• Gross profit increased 44.3% year-over-year to RMB1,496.8 million, with gross margin improving to 67.4%.

• Adjusted EBITDA reached RMB319.3 million, up 72.7% year-over-year, reflecting operational efficiency and cost control.

• Profit for the period was RMB250.6 million, up 143.8% year-over-year; adjusted profit was RMB278.8 million, up 115.1%.

• No interim dividend was declared for the period.

Financial highlights

• Revenue: RMB2,220.6 million (+26.7% YoY); gross profit: RMB1,496.8 million (+44.3% YoY).

• Online game revenue grew 32.0% YoY to RMB1,425.9 million, offsetting declines in older titles.

• TapTap platform revenue increased 21.7% YoY to RMB734.3 million, with PRC MAUs up 27.3%.

• Selling and marketing expenses rose 110.4% to RMB695.3 million, mainly due to new game launches and TapTap marketing.

• Cash and short-term investments totaled RMB2,281.7 million as of June 30, 2024.

Outlook and guidance

• Continued focus on high-quality self-developed games and platform expansion.

• Expansion of GoGo Muffin and Heartopia into overseas markets planned for H2 2024.

• TapTap to enhance user experience and long-term growth through AI and marketing strategies.