The company performed decently in the first quarter of 2022, with a spike in revenue and gross margin growth. At the same time, operating expenses continue to decline despite ongoing R&D efforts.
Audio-social and entertainment company LIZHI (LIZI:NASDAQ) announced its unaudited financial results on May 26, which showed a 4% increase in net revenue to CNY 516.7 million (USD 81.5 million). .
The net profit recorded during the reporting period amounted to CNY 16.4 million (USD 2.6 million), compared to a net loss of CNY 70.0 million in the first quarter of 2021.
Marco Lai, Founder and CEO of LIZHI, highlighted the company’s efforts to optimize operational efficiency and improve margins. The result is positive as the company’s gross profit was CNY 168 million in the first quarter of 2022, which is a jump of 34% from CNY 125 million in the same period last year.
During this time, it should be noted that the company’s total operating expenses have also decreased. It was only 153.5 million yuan in the current quarter, compared to 197.3 million yuan in the same period last year. Nonetheless, LIZHI remained dedicated to R&D and increased spending by 25% year-on-year. It is mainly explained by the increase in wages, social benefits and rental charges.
Additionally, the company aims to boost the vitality of its audio community and boost user interactions. As a result, the average number of mobile monthly active audio entertainment (MAU) users increased by 11%, from 8.3 million in the first quarter of 2021 to 9.1 million in the first quarter of this year.
Meanwhile, the average total number of monthly paid users also increased by 2% to 482,200 during this quarter. This group of users is crucial as it remains an important source of revenue for the company.
The company’s domestic rivals include Dragonfly FM and Himalaya. To further strengthen its position in the field of user-generated audio content, the company will continue to build a more competitive audio ecosystem, pursuing diversified marketing channels and advancing its technological capabilities, LIZHI said.
LIZHI shares closed up 5.26% at $1.14 each, with a market capitalization of $57.8 million.