Zepp Health Corporation reported its unaudited financial results for the first quarter of 2025, with revenues of US$38.5 million, a 3.6% decrease year-over-year. However, sales of Amazfit-branded products grew 10.2% year-over-year, marking a return to growth for the brand since the first quarter of 2022. This growth was driven by the successful launches of the Amazfit Active 2 and Bip 6, despite some supply constraints for the Active 2 premium version and the delayed launch of the Bip 6.
The gross margin for Q1 2025 was 37.3%, higher than both Q1 and Q4 2024. Excluding the additional 20% tariffs imposed on China-made products, the gross margin would have been 38.4%. The company reported an operating loss of US$18.4 million and a net loss of US$19.7 million, as the first quarter is traditionally the lowest sales season for the consumer electronics industry.
As of March 31, 2025, the cash balance stood at US$103.8 million. Zepp Health continued its debt optimization efforts, repaying US$11.5 million in Q1 2025, bringing the total debt retired since early 2023 to US$67.8 million. The share repurchase program remained active, with US$15.4 million used to repurchase approximately 2.0 million ADSs.
Technological advancements included a 17-fold improvement in Zepp Flow voice command responsiveness using Llama, and a 90% reduction in food recognition costs in the app's food log through a hybrid AI solution. The company expanded this service across Europe and doubled daily usage allowance. Zepp Health also deepened its HYROX community presence and welcomed Olympic medalist Gabby Thomas and Italian tennis star Jasmine Paolini as athlete partners, with Paolini winning the Rome Open wearing the Active 2 watch.
For the second quarter of 2025, management expects net revenues between US$50 million and US$55 million, representing an increase of approximately 23% to 35% from US$40.6 million in Q2 2024. This outlook reflects anticipated continued growth in Amazfit-branded sales and new product launches.
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