So-Young International Inc. (NASDAQ: SY) reported Q3 EPS of $0.04. Revenue for the quarter came in at $42.3 million versus the consensus estimate of $38.79 million.

Third Quarter 2019 Financial Highlights

• Total revenues were RMB302.4 million (US$42.3 million1), an 79.6% increase from the same period of 2018 and exceeding the high-end of the Company's guidance range.
• Gross margin was 82.2%, compared with 85.7% in the same period of 2018.
• Income from operations was RMB20.0 million (US$2.8 million), compared with a loss from operation of RMB 22.1 million in the same period of 2018.
• Net income was RMB31.6 million (US$4.4 million), compared with a net loss of RMB25.2 million in the same period of 2018.
• Non-GAAP net income2 was RMB40.5 million (US$5.7 million), compared with a non-GAAP net loss of RMB9.3 million in the same period of 2018.
• Basic and diluted earnings per American Depositary Shares (“ADSs”) attributable to ordinary shareholders were RMB0.31 (US$0.04) and RMB0.29 (US$0.04), respectively. Thirteen ADSs represent ten Class A ordinary shares.

Third Quarter 2019 Operational Highlights

• Average mobile MAUs were 3.42 million, an increase of 143.8% from 1.40 million in the third quarter of 2018.
• Total number of purchasing users were 172,500, an increase of 60.2% from 107,700 in the third quarter of 2018.
• Number of paying medical service providers on So-Young’s platform were 3,230, an increase of 33.6% from 2,418 in the third quarter of 2018.
• Number of medical service providers subscribing to information services on So-Young’s platform were 2,104, an increase of 51.5% from 1,389 in the third quarter of 2018.
• Aggregate value of medical aesthetic treatment transactions facilitated by So-Young’s platform was RMB976.2 million, an increase of 74.7% from RMB558.6 million in the third quarter of 2018.

"We delivered another strong quarter of results with revenue exceeding the high-end of our guidance range as we capitalized on the strength, quality and stickiness of our platform,” commented Mr. Xing Jin, Co-Founder and Chief Executive Officer of So-Young. “Our community of users continues to grow as a result of our enhanced user experience and rich content which drove significant 86.8% year-over-year growth in information services revenue. Medical service providers on our platform continue to see the unique value proposition our effective customer acquisition services, differentiated branding, and ability to improve operating efficiency offer in driving growth across their businesses. Average mobile MAUs and total number of purchasing users also continued to grow rapidly as well, with increases of 143.8% and 60.2%, respectively, from the same period last year. We will continue to focus on expanding our user base both in quantity and quality by penetrating deeper into the medical aesthetic service industry. Looking ahead, we do believe that this sector will continue to generate substantial growth opportunities and are confident that our strategy will uniquely positioned to benefit from them and create long-term value for our shareholders.”

“Total revenues during the quarter exceeded guidance, coming in at RMB302.4 million, an increase of 79.6% year-over-year,” added Mr. Min Yu, Chief Financial Officer of So-Young. “We continue to be strategic in monetizing services across our platform which has not impacted our user base or stickiness. This is key to enhancing the user experience and growing our user base. We are aware of the competitive nature of the industry but remain confident that our differentiated platform and technological innovation will continue to drive operational efficiency while we grow our community of users and capitalize on the network effect. We continue to build our platform out to scale with diverse revenue streams which will help strengthen and support our profitability over the long-run.”

GUIDANCE:

So-Young International Inc. sees Q4 2019 revenue of $44.8-47.6 million, versus the consensus of $42.04 million.

• For the fourth quarter of 2019, So-Young expects total revenues to be between RMB320 million (US$44.8 million) and RMB340 million (US$47.6 million), representing a 74.9% to 85.8% increase from the same period in 2018.
• The above outlook is based on the current market conditions and reflects the Company’s preliminary estimates of market and operating conditions, and customer demand, which are all subject to change.

For earnings history and earnings-related data on So-Young International Inc. (SY) click here.