Zepp Health Corp (ZEPP) 2025 Q1 法說會逐字稿

Hello, ladies and gentlemen. Thank you for standing by for Zepp Health Corporation's first quarter 2025 earnings conference call. (Operator Instructions) Today's conference call is being recorded.

女士們、先生們，大家好。感謝您參加 Zepp Health Corporation 2025 年第一季財報電話會議。（操作員指示）今天的電話會議正在錄音。

I will now send the call over to your host, Ms. Grace Zhang, Director of Investor Relations for the company. Please go ahead, Grace.

現在我會把電話轉給主持人、公司投資人關係總監 Grace Zhang 女士。請繼續，格蕾絲。

Hello, everyone, and welcome to Zepp Health Corporation's First Quarter 2025 Earnings Conference Call. The company's financial and operating results were issued in a press release via the newswire services earlier today and are posted online. You can also view the earnings press release and slides referred to on this call by visiting the IR section of the company's website at ir.zepp.com.

大家好，歡迎參加 Zepp Health Corporation 2025 年第一季財報電話會議。該公司的財務和經營業績於今天早些時候透過新聞通訊社以新聞稿形式發布，並在網路上發布。您也可以造訪本公司網站 ir.zepp.com 的 IR 部分，查看本次電話會議中提到的收益新聞稿和投影片。

Participating in today's call are Mr. Wang Huang Wang, our Chairman of the Board of Directors and the Chief Executive Officer; and Mr. Leon Cheng Deng, our Chief Financial Officer. The company's management will begin with prepared remarks, and the call will conclude with a Q&A session. Mr. Mike Yeung, our Chief Operating Officer, will join us for the Q&A session.

參加今天電話會議的有我們的董事會主席兼執行長王黃旺先生；以及我們的財務長鄧立成先生。公司管理階層將以準備好的發言開始會議，最後以問答環節結束。我們的營運長 Mike Yeung 先生將參加我們的問答環節。

Before we continue, please note that today's discussion will contain forward-looking statements made under the safe harbor provision of the US Private Securities Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, the company's actual results may be materially different from the views expressed today. Further information regarding this and other risks and uncertainties are included in the company's annual report on Form 20-F for the fiscal year ended December 31, 2024, and other filings as filed with the US Securities and Exchange Commission.

在我們繼續之前，請注意，今天的討論將包含根據 1995 年美國私人證券訴訟改革法案的安全港條款做出的前瞻性陳述。前瞻性陳述涉及固有風險和不確定性。因此，該公司的實際結果可能與今天表達的觀點有重大差異。有關此風險和其他風險及不確定因素的更多信息，包含在公司截至 2024 年 12 月 31 日的財政年度的 20-F 表年度報告以及向美國證券交易委員會提交的其他文件中。

The company does not assume any obligation to update any forward-looking statements, except as required under applicable law. Please also note Zepp's earnings release and this conference call include discussions of unaudited GAAP financial information as well as unaudited non-GAAP financial information. Zepp's press release contains a reconciliation of the unaudited non-GAAP measures to the unaudited most directly comparable GAAP measures. I'll now turn the call over to our CEO, Mr. Wang Huang Wang.

除適用法律要求外，本公司不承擔更新任何前瞻性聲明的義務。另請注意，Zepp 的收益報告和本次電話會議包括未經審計的 GAAP 財務資訊以及未經審計的非 GAAP 財務資訊的討論。Zepp 的新聞稿包含未經審計的非 GAAP 指標與未經審計的最直接可比較 GAAP 指標的對帳。現在我將電話轉給我們的執行長王黃旺先生。

Please go ahead.

請繼續。

Hello, everyone. Welcome, and thank you for joining our first quarter 2025 earnings call. We are delighted to announce that this quarter, we see a 10% year-over-year growth of Amazfit revenue, first time after two years of our transformation period. Before delving into this quarter's results, I would like to emphasize the challenging macro terrain within the consumer electronics sector. Trade frictions and fluctuating tariff policies have not only introduced uncertainty but also prompted us to undertake strategic enhancements to our operations.

大家好。歡迎，感謝您參加我們的 2025 年第一季財報電話會議。我們很高興地宣布，本季度，Amazfit 的營收年增 10%，這是我們轉型期兩年來的首次成長。在深入探討本季的業績之前，我想先強調一下消費性電子產業面臨的宏觀挑戰。貿易摩擦和不斷變化的關稅政策不僅帶來了不確定性，也促使我們對營運進行策略性改善。

We proactively diversified our supply chain several years ago foreseeing geopolitical complexities. Also, the recent US tariff exemptions on specific product categories has [alleviated] some of the immediate pressure. Our dual sourcing model from China and Vietnam remains pivotal in ensuring operational agility; we have expanded our supply chain footprint in Vietnam and are actively exploring opportunities within NAFTA region. This initiative aim to mitigate change risk and optimize cost measurement.

幾年前，我們預見了地緣政治的複雜性，並主動實現了供應鏈多元化。此外，美國近期對特定產品類別實施的關稅豁免也緩解了一些眼前壓力。我們在中國和越南的雙重採購模式對於確保營運彈性仍然至關重要；我們已經擴大了在越南的供應鏈足跡，並正在積極探索北美自由貿易區內的機會。該計劃旨在減輕變更風險並優化成本衡量。

Our pricing strategy is tailored to each market and product line. In some instances, we have the flexibility to adjust prices, while in more competitive segments, price increases are challenging. Thus, we approach pricing on a case-by-case basis. Additionally, by offering a broader portfolio of products ranging from high-end to budget-friendly options, we are better equipped to offset potential tariff impacts.

我們的定價策略針對每個市場和產品線量身訂做。在某些情況下，我們可以靈活地調整價格，而在競爭更激烈的領域，漲價則具有挑戰性。因此，我們根據具體情況來決定定價。此外，透過提供從高端到經濟實惠的更廣泛的產品組合，我們可以更好地抵消潛在的關稅影響。

In summary, the US represents a significant growth market for our business, accounting for about 15% of our revenue. Currently, tariffs have a minimal impact on our operations, but we remain vigilant, closely monitoring the macroeconomic environment and situation.

總而言之，美國是我們業務的一個重要的成長市場，約占我們收入的 15%。目前，關稅對我們的營運影響很小，但我們仍保持警惕，密切關注宏觀經濟環境和情況。

Turning to our performance for the first quarter of 2025. Despite the first quarter traditionally being a low season for consumer electronics, our overall sales aligned with our guidance. Notably, Amazfit products' sales increased by more than 10% compared to the same quarter last year, underscoring the success of our strategic shift to a more self-reliant, brand-centered approach and sustainable growth.

談談我們 2025 年第一季的業績。儘管第一季傳統上是消費性電子產品的淡季，但我們的整體銷售額與我們的預期一致。值得注意的是，Amazfit 產品的銷售量與去年同期相比增長了 10% 以上，凸顯了我們向更自力更生、以品牌為中心的方式和可持續增長的策略轉變的成功。

However, due to the seasonal nature of the first quarter, fixed operating expenses were not fully absorbed by the increased sales, putting some pressure on our operating profit. However, we expect this to be improved in the coming quarter.

然而，由於第一季的季節性，固定營運費用並未被增加的銷售額完全吸收，對我們的營運利潤造成了一些壓力。不過，我們預計下一季情況將會有所改善。

Now let's highlight some of our product achievements which continue to anchor our brand momentum. During the first quarter, we successfully launched the Amazfit Active 2 at CES 2025, which received positive reviews from major media outlets in both Europe and the United States. The (inaudible) Active 2 wrong lumium line expand our profile, our strategic of combining cutting-edge technology with stylish design and (inaudible) band and (technical difficulty) glass screen, catering to the growing demand in the lifestyle smartwatch market.

現在讓我們重點介紹一下我們的一些產品成就，這些成就繼續鞏固了我們的品牌勢頭。第一季度，我們在 CES 2025 上成功推出了 Amazfit Active 2，並獲得了歐洲和美國主流媒體的正面評價。(聽不清楚) Active 2 wrong lumium 系列擴大了我們的形象，我們將尖端技術與時尚設計以及（聽不清）錶帶和（技術難度）玻璃屏幕相結合的戰略，滿足了生活方式智能手錶市場日益增長的需求。

It features 24/7 health and fitness monitoring utilizing the latest advanced generation biosensor for enhanced precision in health tracking, includes improved algorithm and 160 sports modes, including support for new sports like skiing. With AI-driven coaching and multi-satellite navigation, it offers seamless smart interactions targeting the overall user experience.

它具有全天候健康和健身監測功能，利用最新一代先進生物感測器來提高健康追蹤的精確度，包括改進的演算法和 160 種運動模式，包括對滑雪等新運動的支援。透過人工智慧驅動的指導和多衛星導航，它提供針對整體用戶體驗的無縫智慧互動。

Furthermore, we broadened our market reach with the launch of the Amazfit Bip 6 in March. The Bip 6 integrates advanced health tracking biosensing technology, AI coaching and multi-satellite navigation for offline app, offering consumers exceptional value at accessible price points. This product further strengthens our presence in the entry-level segment, aligning with our strategy to cater to a wide range of consumer needs and increase market penetration.

此外，我們在 3 月推出了 Amazfit Bip 6，擴大了我們的市場範圍。Bip 6 整合了先進的健康追蹤生物感測技術、AI 指導和離線應用程式的多衛星導航，以可承受的價格為消費者提供卓越的價值。該產品進一步加強了我們在入門級市場的地位，符合我們滿足廣泛消費者需求和提高市場滲透率的策略。

Over the past four months, the successful launches of these smart watches has secured top positions in the growth Amazon's smart banking. (inaudible) of 4.3 and with the extremely positive scores of 4.6 in the USA, they have consistently secured spots within the top 50 and frequently ranks among the top 10 on Amazon's smartwatch category in the markets of major countries.

過去四個月，這些智慧手錶的成功推出確保了亞馬遜智慧銀行業務的成長領先地位。 （聽不清楚）的評分為 4.3，在美國也獲得了 4.6 的極高評分，它們一直穩居前 50 名，並經常在主要國家的市場上亞馬遜智慧手錶類別中名列前十。

They also earned rave reviews within the Reddit community. The initial sales momentum of Active 2 and Bip 6 are much stronger than the previous versions. They have gained wide recognition from mainstream off-line channels, helped the Amazfit brand keep gaining market share in most competitive smartwatch market such as Spain and Italy.

他們還在 Reddit 社群中贏得了熱烈的評價。Active 2 和 Bip 6 的初始銷售勢頭比之前的版本強勁得多。獲得了主流線下通路的廣泛認可，助力Amazfit品牌在西班牙、義大利等競爭最激烈的智慧手錶市場持續獲得市場份額。

To name a few, in Italy, according to GFK, our market share of no sim smartwatch unit sales stood at 23.3% in March 2025, ranked as number two in the core wearable smartwatch market right after 42% of Apple. In Italy and Spain, 5% of us are among the CFK 25 head list in March '25.

舉例來說，在義大利，根據 GFK 的數據，2025 年 3 月我們的無 SIM 卡智慧手錶銷售市場份額為 23.3%，在核心可穿戴智慧手錶市場排名第二，僅次於蘋果的 42%。在義大利和西班牙，我們當中的 5% 人位列 2025 年 3 月 CFK 25 人名單中。

Just this past weekend, our global brand gained major international visibility when Amazfit athlete, Jasmine Paolini won the Rome Open, becoming the first Italian woman in 40 years to claim the title. Her breakthrough moment generated strong global media attention and spotlighted our Amazfit Active 2 watch, which she wore during the trophy ceremony and media interviews, along with branded apparel prominently featuring the Amazfit logo throughout the tournament.

就在上週末，Amazfit 運動員 Jasmine Paolini 贏得了羅馬公開賽冠軍，成為 40 年來首位奪得該項冠軍的意大利女性，我們的全球品牌獲得了巨大的國際知名度。她的突破時刻引起了全球媒體的強烈關注，並引起了我們 Amazfit Active 2 手錶的關注，她在頒獎典禮和媒體採訪中佩戴了這款手錶，同時在整個比賽期間還穿著帶有 Amazfit 標誌的品牌服裝。

We will leverage this momentum to further accelerate growth in our already strong Italian market and expand our influence across the broader sports category. As we continue to grow our global footprint, moments like these help build long-term brand equity and emotional connection with our expanding user base. Robustness of these budget friendly and profound impact on our brand influence and market share not only paves the robust groundwork for the upcoming launches of our mid-to high-end products in the following quarter, but also bolster the confidence of our channel partners. It has significantly broadened our user base and expanded the sales funnel, creating a more promising market landscape for our brand.

我們將利用這一勢頭進一步加速我們已經強大的義大利市場的成長，並擴大我們在更廣泛的體育類別中的影響力。隨著我們繼續擴大全球影響力，這樣的時刻有助於建立長期品牌資產以及與不斷擴大的用戶群的情感聯繫。這些價格親民且對我們品牌影響力和市場份額產生深遠影響的產品，不僅為我們下一季即將推出的中高端產品打下了堅實的基礎，也增強了我們通路合作夥伴的信心。它大大拓寬了我們的用戶群，擴大了銷售管道，為我們的品牌創造了更光明的市場前景。

To summarize, our new product sales in Q1 demonstrated exceptional momentum, reaching the highest level in our product history. The performance not only surpasses previous records, but also outpaces our historical best-selling models, including the Bip 5 and the first-generation Active series. With the production and the delivery challenges on the verge of being fully resolved, we expect higher sales in the upcoming quarters from our new product launches.

總而言之，我們第一季的新產品銷售表現出色，達到了我們產品歷史上的最高水準。該性能不僅超越了以往的記錄，也超越了我們歷史上最暢銷的車型，包括Bip 5和第一代Active系列。隨著生產和交付挑戰即將全面解決，我們預計未來幾季新產品的銷售將有所提高。

Turning to our technology innovations, Amazfit 2 and Amazfit Bip 6 occurred with the latest Zepp OS 4.5 powered by OpenAI. Key features include advanced full voice control, enabling users to adjust settings and check progress hands-free. The messaging experience has also been improved, allowing users to reply using a full keyboard or speech to text input, with the system optimizing responses through suggestions or translations powered by large language models.

談到我們的技術創新，Amazfit 2 和 Amazfit Bip 6 採用了由 OpenAI 提供支援的最新 Zepp OS 4.5。主要功能包括先進的全語音控制，使用戶能夠調整設定並免持檢查進度。訊息傳遞體驗也得到了改善，允許用戶使用全鍵盤或語音到文字輸入進行回复，系統透過大型語言模型提供的建議或翻譯來優化響應。

Additionally, we have introduced the camera powered food log feature in the Zepp app, which allows users to take photos of their meals directly in the app. The system automatically uploads nutrition data for seamless meal checking. This feature is currently available in Europe, the US and Japan. We remain committed to leveraging open source technologies such as LLaMA. Recently, we enhanced the responsiveness of Zepp voice commands on our smart watches, achieving a 17-fold improvement in speed.

此外，我們在 Zepp 應用程式中引入了攝影機驅動的食物日誌功能，用戶可以直接在應用程式中拍攝他們的餐點照片。系統自動上傳營養數據，實現無縫膳食檢查。此功能目前在歐洲、美國和日本可用。我們仍然致力於利用 LLaMA 等開源技術。最近，我們增強了智慧型手錶上 Zepp 語音指令的反應速度，速度提高了 17 倍。

Additionally, by adopting a hybrid AI solution combining OpenAI and Google Gemini, we reduced the cost of food recognition in our app's food log to just 10% of the original. This enabled us to expand the service across our wider region in Europe and double the daily usage allowance for users.

此外，透過採用OpenAI和Google Gemini相結合的混合AI解決方案，我們將應用程式食物日誌中食物識別的成本降低到原來的10％。這使我們能夠將服務擴展到歐洲更廣泛的地區，並將用戶的每日使用量增加一倍。

This agile and strategic technological integration has accelerated the scalability of our health and fitness services, driving both innovation and cost efficiency. As part of our strategic effort to gain greater brand recognition and expand our influence, we have been actively involved the Hyrox community. This year, we participate in Hyrox events in Chicago, Taipei and Shanghai, engaging with a global audience of fitness enthusiasts.

這種靈活且策略性的技術整合加速了我們的健康和健身服務的可擴展性，推動了創新和成本效率。作為我們獲得更大品牌認知度和擴大影響力的策略努力的一部分，我們積極參與 Hyrox 社群。今年，我們參加了在芝加哥、台北和上海舉行的 Hyrox 活動，與全球健身愛好者進行了互動。

Our partnership with Hyrox, where Amazfit serves as the official wearable and timekeeping partner continues to strengthen our position in the competitive fitness sector. This collaboration allows us to support athletes with advanced wearable technology which enhances their training and performance.

我們與 Hyrox 的合作（Amazfit 是其官方穿戴裝置和計時合作夥伴）繼續加強我們在競爭激烈的健身領域的地位。此次合作使我們能夠為運動員提供先進的可穿戴技術，從而提高他們的訓練水平和表現。

Looking ahead, we plan to expand our presence at Hyrox events, further integrating our products into the fitness community through a comprehensive series of brand campaigns and community building initiatives centered around Hyrox. The activation rate of our T-Rex 3 device has sustained robust growth both year-over-year and month-over-month.

展望未來，我們計劃擴大在 Hyrox 活動中的影響力，透過以 Hyrox 為中心的一系列全面的品牌活動和社區建設計劃，將我們的產品進一步融入健身社區。我們的T-Rex 3設備的活化率年比和季比均保持強勁成長。

Even eight months post launch the product has successfully captured a claim of sports enthusiasts across an expanding number of regions. This remarkable achievement not only underscores the market appeal of our offering, but also paves the way of a strong and promising launch of our upcoming lineup of flagship sports products.

該產品推出八個月後就已成功吸引了越來越多地區的運動愛好者。這項非凡成就不僅凸顯了我們產品的市場吸引力，也為我們即將推出的強勁且前景廣闊的旗艦運動產品系列鋪平了道路。

We continue to advance our sports and lifestyle strategy by building brand awareness through event sponsorships and partnerships with top athletes. We are thrilled to welcome five-time Olympic Medalist Gabby Thomas and Italian tennis star Jasmine Paolini as our global athlete partners. These partnerships enhance our brand visibility on the world stage while showcasing how Amazfit smart wearables empower top-tier athletes with data-driven insights and to optimize their training, recovery and overall performance through Zepp, through new product introductions, innovations in our software and continuous investment of brand awareness and recognition.

我們透過賽事贊助和與頂級運動員合作來建立品牌知名度，從而繼續推進我們的體育和生活方式策略。我們非常高興地歡迎五屆奧運獎牌得主加布麗·托馬斯和義大利網球明星賈斯敏·保利尼成為我們的全球運動員合作夥伴。這些合作提升了我們在世界舞台上的品牌知名度，同時展示了 Amazfit 智慧型穿戴裝置如何透過 Zepp、新產品的推出、軟體的創新以及品牌知名度和認知度的持續投資，為頂級運動員提供數據驅動的洞察力，並優化他們的訓練、恢復和整體表現。

We have set clear strategic objectives to drive our next phase of growth. These include strengthening our presence in entry-level markets, deepening collaboration and investment with our off-line channel partners, expanding brand exposure and community engagement and ultimately guiding users towards upgrading our mid-and high-end product offerings from Angelobit Active series towards the Balance and T-Rex series.

我們已經制定了明確的策略目標來推動下一階段的成長。這些措施包括加強我們在入門級市場的存在，深化與離線通路合作夥伴的合作和投資，擴大品牌知名度和社群參與度，並最終引導用戶將我們的中高端產品從 Angelobit Active 系列升級到 Balance 和 T-Rex 系列。

Looking ahead to the second quarter of 2025, we are optimistic about achieving our first year-over-year growth of overall sales since 2021, which will be a significant turning point of our company. The anticipated growth is driven by product innovation, strengthened partnership and expanding global presence. At the same time, we remain vigilant of the macroeconomic challenges and uncertainties.

展望2025年第二季度，我們樂觀地認為，公司整體銷售額將實現自2021年以來的首次年比成長，這將是公司發展的重要轉捩點。預期的成長是由產品創新、加強的合作夥伴關係和擴大的全球影響力所推動的。同時，我們也要警惕宏觀經濟面臨的挑戰和不確定性。

Our strategy to navigate these complexities includes further optimize our supply chain, strengthening broader brand positioning and enhanced product differentiation. These efforts will ensure Zepp Health remain resilient and competitive in the evolving smart wearable market. And I believe 2025 will be a fruitful year of Zepp.

我們應對這些複雜情況的策略包括進一步優化我們的供應鏈、加強更廣泛的品牌定位和增強產品差異化。這些努力將確保 Zepp Health 在不斷發展的智慧穿戴市場中保持彈性和競爭力。我相信2025年將會是Zepp豐碩的一年。

I will now turn the call over to Leon to go over the highlights of our first quarter financial results.

現在我將把電話轉給 Leon，讓他回顧我們第一季財務表現的亮點。

Thank you, Wang. Greetings, everyone. Thank you again for joining our first quarter 2025 earnings call. Let me start by highlighting some key metrics from our financial results for the first quarter of 2025. I would like to share some of our supply chain strategy first.

謝謝你，王。大家好。再次感謝您參加我們的 2025 年第一季財報電話會議。首先，我來重點介紹我們 2025 年第一季財務表現的一些關鍵指標。我想先分享我們的一些供應鏈策略。

We operate in a dynamic global environment influenced by macroeconomic factors and changing tariffs. However, we are well positioned due to past actions. Echo to what Wang just mentioned, we shifted most US bound productions from China to Vietnam in past years, limiting our exposure to China tariffs.

我們在一個受宏觀經濟因素和不斷變化的關稅影響的動態全球環境中運作。然而，由於過去的行動，我們處於有利地位。正如王剛才所提到的，過去幾年，我們將大部分銷往美國的產品從中國轉移到了越南，這限制了我們受到中國關稅的影響。

Our remaining China tariffs exposure is limited to a few accessories like packing boxes and chargers, which are a very small part of our business. These moves give us production flexibility and optionality as new tariff structures take shape. Currently, we are seizing the opportunity of the temporary Vietnam tariff halt by ramping up production, scenario planning with manufacturers for origin flexibility, collaborating with partners and retailers to showed consumers and accessing pricing and promotion strategies to keep products more appealing while optimizing gross profit.

我們剩餘的中國關稅風險僅限於包裝盒和充電器等少數配件，這些只占我們業務的一小部分。隨著新的關稅結構逐漸形成，這些措施為我們的生產提供了靈活性和選擇性。目前，我們正在抓住越南暫時停止徵收關稅的機會，加大產量，與製造商一起規劃原產地靈活性的情景，與合作夥伴和零售商合作向消費者展示，並製定定價和促銷策略，以保持產品更具吸引力，同時優化毛利潤。

We believe these strategic arrangements will enhance our operational resilience. With a strong balance sheet, a nimble operational posture and an experienced team that is executing with discipline, we are setting ourselves up for fruitful performance in 2025. Now let's turn to the financials.

我們相信這些策略安排將增強我們的營運彈性。憑藉強大的資產負債表、靈活的營運態勢和一支經驗豐富、紀律嚴明的團隊，我們為 2025 年取得豐碩的業績做好了準備。現在讓我們來談談財務狀況。

In Q1, our sales come in line with the guidance range we provided. Notably, we achieved 10.2% year-over-year growth in our Amazfit branded products, which reflects the strong market reception of our newly launched models, Active 2 and Bip 6. This marks the first year-over-year growth of our Amazfit branded products we have achieved since the start of our transformation journey. We considered it a significant milestone as we are confident this positive momentum will persist through the second quarter and expand well beyond as we have more new products lined up for the remainder of the year.

第一季度，我們的銷售額符合我們提供的指導範圍。值得注意的是，我們的 Amazfit 品牌產品實現了 10.2% 的同比增長，這反映了我們新推出的型號 Active 2 和 Bip 6 受到了市場的熱烈歡迎。這是我們轉型以來Amazfit品牌產品首次實現年成長。我們認為這是一個重要的里程碑，因為我們相信這種積極的勢頭將持續到第二季​​度，隨著我們在今年剩餘時間內推出更多新產品，這種勢頭還將進一步擴大。

Turning to gross margin. It was influenced by various factors, including product mix, product launch timing and product life cycle such as model upgrades. In Q1 2025, we achieved a gross margin of 37.3%, which is higher than both Q4 2024 and Q1 2024, largely driven by new product launches.

轉向毛利率。它受到多種因素的影響，包括產品結構、產品推出時機以及模型升級等產品生命週期。2025 年第一季度，我們的毛利率達到 37.3%，高於 2024 年第四季和 2024 年第一季度，這主要得益於新產品的推出。

During the quarter, gross margin was negatively impacted by the additional 20% US tariff on China-made products, which reduced our gross margin by approximately 1 percentage point. Excluding the tariff impact, gross margin would have reached 38.4%. Looking ahead, we expect the gross margin expansion to continue into the rest of 2025.

本季，毛利率受到美國對中國製造產品加徵20%關稅的負面影響，導致毛利率下降約1個百分點。不計關稅影響，毛利率將達38.4%。展望未來，我們預計毛利率擴張將持續到 2025 年剩餘時間。

Now let's turn our attention to costs. We remain steadfast in our commitment to cost management, continuing with the program that we began in 2020 Q3 on reducing overall operating costs. Operating expenses for the first quarter totaled USD31.5 million compared to USD29.3 million in Q4 '24 and then USD27.8 million in Q1 2024.

現在讓我們把注意力轉向成本。我們堅定不移地致力於成本管理，繼續執行 2020 年第三季啟動的降低整體營運成本的計畫。第一季的營運費用總計 3,150 萬美元，而 2024 年第四季為 2,930 萬美元，2024 年第一季為 2,780 萬美元。

The USD2.2 million quarter-on-quarter increase mainly reflects higher R&D expenses as we continue to invest in new product development, along with increased selling and marketing expenses to support our Q1 launches. Compared to Q1 2024 last year, operating expenses increased by USD4 million year-over-year. This increase includes approximately USD3 million in higher selling expenses, driven by USD1.7 million spent on digital marketing campaigns and new product launch events and USD1.4 million invested in strengthening our sales channels.

環比成長 220 萬美元主要反映了我們繼續投資新產品開發而導致的研發費用增加，以及為支持第一季產品發布而增加的銷售和行銷費用。與去年2024年第一季相比，營業費用年增了400萬美元。這一成長包括約 300 萬美元的銷售費用增加，其中 170 萬美元用於數位行銷活動和新產品發布活動，140 萬美元用於加強銷售管道。

Additionally, we faced around USD1.0 million in foreign exchange headwinds during the quarter. We will maintain our cost-conscious approach in the upcoming quarters to keep the overall operating cost at a level between USD25 million to USD27 million per quarter. Concurrently, we remain committed in investing in R&D and marketing activities to ensure our long-term competitiveness.

此外，本季我們還面臨約 100 萬美元的外匯逆風。我們將在未來幾季繼續保持注重成本的做法，將整體營運成本保持在每季 2,500 萬美元至 2,700 萬美元的水平。同時，我們繼續致力於投資研發和行銷活動，以確保我們的長期競爭力。

R&D expenses in the first quarter of 2025 were USD11.5 million, a decrease by 3.4% year-over-year. The decrease was a result of our refined research and development approaches. As Wang previously mentioned, we are committed in investing in new technologies and AI-like open source technologies to secure our long-term technology leadership.

2025年第一季研發費用為1,150萬美元，年減3.4%。這一下降是我們改進研發方法的結果。正如王建宙先前所提到的，我們致力於投資新技術和類似人工智慧的開源技術，以確保我們長期的技術領先地位。

Selling and marketing expenses in the first quarter of 2025 were USD13.8 million and increased by 31% year-over-year. This increase was primarily driven by the USD1.7 million spent on digital marketing campaigns and new product launch events and then USD1.4 million invested in strengthening our sales channels.

2025年第一季銷售和行銷費用為1,380萬美元，年增31%。這一成長主要得益於我們在數位行銷活動和新產品發布活動上花費的 170 萬美元，以及在加強銷售管道上投資的 140 萬美元。

We also engaged with rising sports stars like Gabby Thomas and Jasmine Paolini to improve our brand awareness. At the same time, we consistently pushed on retail profitability and channel mix improvement. We are committed to investing efficiently in marketing and branding expenses to ensure our sustainable growth. G&A expenses were USD6.2 million in the first quarter of 2025 compared with USD5.4 million in the first quarter of 2024. The increase was largely attributed to foreign exchange headwinds.

我們也與 Gabby Thomas 和 Jasmine Paolini 等新興運動明星合作，以提高我們的品牌知名度。同時，我們不斷推動零售獲利能力和通路組合改善。我們致力於有效投資行銷和品牌費用，以確保我們的永續成長。2025 年第一季的一般及行政費用為 620 萬美元，而 2024 年第一季為 540 萬美元。這一增長主要歸因於外匯逆風。

Adjusted operating loss for the first quarter of 2025 was USD17.2 million compared to adjusted operating loss of USD13.1 million for the same period of 2024. The first quarter is typically the season with the lowest sales, which resulted in an inability to fully cover the operating costs.

2025 年第一季調整後營業虧損為 1,720 萬美元，而 2024 年同期調整後營業虧損為 1,310 萬美元。第一季通常是銷售額最低的季節，導致無法完全覆蓋營運成本。

As of March 31, our cash balance stood at USD104 million compared to USD110 million in Q4 2024. Despite a net loss in the quarter, our cash balance only declined by roughly USD6 million, thanks to our enhanced working capital management and improved cash conversion cycle, offsetting the cash burn.

截至 3 月 31 日，我們的現金餘額為 1.04 億美元，而 2024 年第四季為 1.1 億美元。儘管本季出現淨虧損，但由於我們加強了營運資本管理並改善了現金轉換週期，我們的現金餘額僅下降了約 600 萬美元，從而抵消了現金消耗。

We also made solid progress in our capital structure. During the quarter, we successfully refinanced a significant portion of our short-term debt into long-term instruments with a more favorable interest rate and a two year duration. This move significantly reduced our near-term liquidity pressure and improves our overall balance sheet flexibility.

我們的資本結構也取得了穩定進展。在本季度，我們成功地將大部分短期債務再融資為利率更優惠、期限為兩年的長期工具。此舉大大減輕了我們近期的流動性壓力，並提高了我們的整體資產負債表彈性。

During Q1 2023, we have initiated the retirement of our short/long-term debt portfolio. As of Q1 '25, the company has retired a total of USD67.8 million of debt cumulatively with another USD11.5% (sic - "11.5 million") repaid in Q1 2025. As the capital structure will be further optimized as our operating cash flow strengthened. We're pleased to reconfirm our commitment to the share repurchase program for 2025. We believe our current valuation continues to represent an attractive opportunity and reflects our confidence in the company's long-term fundamentals.

2023 年第一季度，我們已開始退出短期/長期債務組合。截至 2025 年第一季度，該公司已累計償還了總計 6,780 萬美元的債務，另有 11.5%（原文如此 - “1,150 萬美元”）將於 2025 年第一季償還。隨著經營現金流的增強，資本結構將進一步優化。我們很高興再次確認我們對 2025 年股票回購計畫的承諾。我們相信，我們目前的估值仍然代表著一個有吸引力的機會，並反映了我們對公司長期基本面的信心。

Turning to our outlook. For the second quarter, we expect revenue to be in the range of USD50 million to USD55 million showing significant year-over-year revenue growth of 23% to 35%, along with the efforts we have made over the past years to cut operating expenses, diversify our supply chain and reduced costs, we anticipate a boost in profitability during the second quarter. Additionally, we remain focused on driving operational efficiencies and expanding our supply chain beyond China to reduce costs and mitigate external risks.

轉向我們的展望。對於第二季度，我們預計收入將在 5,000 萬美元至 5,500 萬美元之間，年比大幅增長 23% 至 35%，加上我們過去幾年為削減營運費用、多元化供應鏈和降低成本所做的努力，我們預計第二季度盈利能力將有所提升。此外，我們仍致力於提高營運效率並將供應鏈擴展到中國以外，以降低成本並減輕外部風險。

At current tariff rates, we estimate the tariff impact in 2025 full year will be approximately USD2 million to USD3 million. However, this impact is expected to be fully offset by global operating efficiency gains. To provide some color on expectations for the balance of 2025, we have many exciting products lined up for the remainder of the year, which will continue to drive our revenue growth for the rest of the year, witnessed by our strong sales performance guided for Q2 2025.

以目前的關稅稅率，我們估計 2025 年全年的關稅影響約為 200 萬至 300 萬美元。不過，預計這項影響將被全球營運效率的提高完全抵銷。為了給 2025 年剩餘時間的預期提供一些參考，我們在今年剩餘時間內準備了許多令人興奮的產品，這些產品將繼續推動我們在今年剩餘時間內的收入增長，我們對 2025 年第二季度強勁的銷售業績預示就是明證。

We expect our full year 2025 operating expenses to be at or below its level versus 2024. We expect to offset tariff cost headwinds with operating efficiency gains, continued supply chain diversifications outside China. The initiatives we undertook in 2024 to reduce operating expenses and improve gross margins are bearing fruit. We are focused on launching a significant number of new products in 2025 and 2026 to restore growth and profitability to our business.

我們預計 2025 年全年營運費用將與 2024 年持平或低於 2024 年水準。我們期望透過提高營運效率、持續推進中國境外的供應鏈多元化來抵銷關稅成本的不利影響。我們在 2024 年採取的降低營運費用和提高毛利率的措施正在取得成效。我們專注於在 2025 年和 2026 年推出大量新產品，以恢復業務成長和獲利能力。

Thank you all for your time today. I will now open the call for questions. Operator, please go ahead.

感謝大家今天的寶貴時間。我現在開始提問。接線員，請繼續。

(Operator Instructions)

（操作員指示）

Sid Rajeev, Fundamental Research Corp.

基礎研究公司 (Fundamental Research Corp.) 的 Sid Rajeev

Hi, thank you. I was wondering if we could get more color on the impact of tariffs. As US exports are produced in Vietnam, is it fair to say your products are currently subject to a 10% tariff? And also, given the 90-day pause, what happens if the tariff has increased to 46% in July? How are you planning that impact?

你好，謝謝。我想知道我們是否可以更詳細地了解關稅的影響。由於美國出口產品是在越南生產的，因此說你們的產品目前要繳納 10% 的關稅是否公平？此外，考慮到 90 天的暫停期，如果 7 月關稅增加到 46%，會發生什麼事？您如何規劃這種影響？

Yeah, I think very good question. So as I just mentioned, we are expecting the full year tariff impact would be around $2 million to $3 million in total. However, this impact is to be offset fully by our global operating efficiency gains. So if you look at it, there are twofold. Number one is even at the environment whereby China, US tariff is sky high, I think at the height of it, it was 100 -- more than 145%. The -- our category as a smart watch is exempt from such a tariff impact. So certain electronics products are exempt from the tariff impact between China and US, even at the height of the tariff situation between China and US.

是的，我認為這個問題問得非常好。正如我剛才提到的，我們預計全年關稅影響總額將在 200 萬至 300 萬美元左右。然而，這項影響將被我們全球營運效率的提高完全抵銷。如果你看一下，你會發現它有兩面性。第一，即使在中國和美國關稅高企的環境下，我認為在最高的時候，關稅曾經達到 100% 到 145% 以上。我們的智慧手錶類別不受此類關稅的影響。因此，即使在中美關稅情勢最嚴峻的時候，某些電子產品仍可免受中美關稅的影響。

So -- and our second scenario is to use Vietnam as a backup of the dual sourcing to provide goods for our US business, right? So if you take a step back, we're actually supplying US with Vietnam and the rest of the world from China. And as -- so number one, we are expecting after the 90 days pause, the situation between US and Vietnam will be coming back to a normal level, maybe at 10% right?

那麼——我們的第二個方案是利用越南作為雙重採購的備份，為我們的美國業務提供商品，對嗎？所以如果你退一步來看，我們實際上是從中國向美國、越南和世界其他地區供應產品。所以第一點，我們預計 90 天的暫停期過後，美國和越南之間的局勢將恢復到正常水平，大概是 10% 對嗎？

Number two, even if it doesn't come back, I think given the recent truce between China and US and our product category is exempt from the tariff impact, I think our tariff situation for the US business for the rest of the year would be in a controllable manner.

第二，即使它沒有恢復，我認為鑑於最近中美之間的休戰以及我們的產品類別不受關稅影響，我認為我們今年剩餘時間美國業務的關稅狀況​​將處於可控狀態。

However, we're also going to use the upcoming 90 days or so to front-load some of the inventories into our US warehouse to prepare for the Q4 sales so that we can actually lock down this number, which I just mentioned to you on tariff. So overall, I don't think it's going to be a big impact for us if you look at what is going on for today.

不過，我們還將利用接下來的 90 天左右的時間將部分庫存預先裝入我們的美國倉庫，為第四季度的銷售做準備，這樣我們才能真正鎖定這個數字，我剛才在關稅方面提到過。所以總的來說，如果你看看今天發生的情況，我認為這不會對我們造成很大的影響。

But yes, the uncertainty remains, and we're also looking at over mid- to long term to do a triple sourcing, for example, in the NAFTA region, which has been mentioned by Wang. So that's a little bit over a mid- to long term.

但是，是的，不確定性仍然存在，我們也在考慮中長期進行三重採購，例如王先生提到的北美自由貿易協定地區。所以這有點超出中長期範圍。

Got it. So the $2 million to $3 million you estimate, that is based on a 10% tariff, not the 46%...

知道了。因此，您估計的 200 萬到 300 萬美元是基於 10% 的關稅，而不是 46%...

That is based on roughly a 10% tariff, yes.

是的，這是基於大約 10% 的關稅。

Okay. Thank you. And what are you seeing in the market these days? Are you and your competitors planning or raising prices, passing cost to consumers? What are your thoughts on that?

好的。謝謝。您最近在市場上看到了什麼？您和您的競爭對手是否打算提高價格，並將成本轉嫁給消費者？您對此有何看法？

No, we're not going to rule out on all the possibilities, but I think we're not going to be the first mover in this if we look at -- and we'll definitely monitor the situation on, for example, Apple or Garmin and all the competitors of us. And if they make a move on pricing, for example, we probably would consider that. But again, since the impact would be relatively limited for us, I don't think we're going to make big adjustments on our pricing strategy. But as I said, we are going to evaluate our pricing strategies on a region-by-region and country-by-country basis, and we're going to make the adjustment where needed.

不，我們不會排除所有可能性，但我認為，如果我們觀察的話，我們不會成為這方面的先行者——我們肯定會監控蘋果或 Garmin 以及我們所有競爭對手的情況。例如，如果他們在定價上採取行動，我們可能會考慮。但同樣，由於對我們的影響相對有限，我認為我們不會對定價策略做出重大調整。但正如我所說，我們將根據每個地區和每個國家的情況評估我們的定價策略，並根據需要進行調整。

Okay. And in terms of OpEx, your goal to get to $25 million to $27 million a quarter. When can you realistically achieve this? And what areas would you cut to get to that number?

好的。就營運支出而言，您的目標是每季達到 2500 萬至 2700 萬美元。你什麼時候才能真正實現這個目標？為了達到這個數字，你會削減哪些領域？

I think realistically, you will see a big reduction in Q2 already. I think in Q2, we're quite confident that we're heading back to a normalized manner. Why you see such a high amount or relatively high amount in Q1 is because of some of the product launch events, which took place in Q1 in a big manner, which is not going to happen on a recurring manner, if you want.

我認為，從現實角度來看，第二季的降幅已經很大了。我認為在第二季度，我們非常有信心恢復正常化。您在第一季看到如此高或相對較高的金額的原因在於一些產品發布活動在第一季大規模舉行，如果您願意的話，這種活動不會以重複的方式發生。

So -- and also we were impacted by $1 million of currency FX headwind which we are also hedging. So that hedge contract in Q2 is actually turning into a profit. So I think overall, I think you will see a first good sign of the cost going down in Q2 already.

所以 — — 我們也受到了 100 萬美元外匯逆風的影響，我們也對其進行了對沖。因此，第二季的對沖合約實際上正在轉化為利潤。所以我認為總的來說，你將在第二季看到成本下降的第一個好跡象。

Okay. Just one final question, Leon, if I may. Last year, you had one product release. And this year, from now to end of the year, how many new products or upgrades are you planning?

好的。如果可以的話，我只想問最後一個問題，Leon。去年，您發布了一款產品。今年，從現在到年底，您計劃推出多少新產品或升級？

I couldn't tell you an exact number, but I think I have alluded to it in the previous call as well. This year, we're aiming to refresh all our major product lines in the different quarters ahead of us, right? So if you look at Q1, we have already launched Active and Balance, and if you look at May, we're actually preparing for some new product launches in China, and we have many exciting products, and that many is definitely more than two in the upcoming quarters to come.

我無法告訴你一個確切的數字，但我想我在之前的通話中也提到過這個數字。今年，我們的目標是在未來幾季更新所有主要產品線，對嗎？因此，如果您看一下第一季度，我們已經推出了 Active 和 Balance，如果您看一下五月份，我們實際上正在準備在中國推出一些新產品，我們有很多令人興奮的產品，而且在接下來的幾個季度中，這個數字肯定會超過兩款。

Thank you so much, Leo.

非常感謝，Leo。

Thank you, Sid.

謝謝你，席德。

(Operator Instructions)

（操作員指示）

[Nicolette Jones], Brooks Investments.

[妮可萊特瓊斯]，布魯克斯投資公司。

Thanks for taking my questions. Sid has actually asked most of them, but I just wanted to sort of get more detail into the full year 2025 performance. If you could just give us some sort of further sort of color on how you see the full year panning out?

感謝您回答我的問題。實際上，Sid 已經詢問了大部分問題，但我只是想更詳細地了解 2025 年全年的表現。您能否進一步說明一下您對全年業績的展望？

Yeah. So yes, normally, we don't guide for a full year number, but this time, I can definitely say a few things about it. So I think we have explained to -- and as Sid just asked, we have many exciting new products lined up for the remainder of the year, which from a sales perspective, will continue to drive our revenue growth for the remainder of the year. And as you can see, our Q2 guidance for the sales growth is already up by 23% to 35%, if not more than that, okay? So that's from a sales perspective.

是的。是的，通常我們不會預測全年的數字，但這次，我肯定可以說幾句。所以我想我們已經解釋過了——正如 Sid 剛才問到的，我們在今年剩餘時間內準備推出許多令人興奮的新產品，從銷售角度來看，這些產品將繼續推動我們在今年剩餘時間內的收入成長。正如您所看到的，我們對第二季銷售成長的預期已經上升了 23% 至 35%，甚至更多，好嗎？這是從銷售角度來看的。

And I think as we're heading into the second half of this year and traditionally for consumer electronics business, also the second half of the year is the high seasons as we're heading into Black Friday, Christmas, Double 11, whatever you name it. So we think the revenue growth trend will definitely go up for the remainder of the year.

我認為，隨著我們進入今年下半年，對於消費電子業務而言，傳統上下半年也是旺季，因為我們將迎來黑色星期五、聖誕節、雙十一號等等。因此我們認為今年剩餘時間內營收成長趨勢肯定會上升。

And you also noticed that our gross margin expansion journey has been growing, and we will continue that journey as well. So I'm expecting the gross margin will be hover around the current level and higher as we head into the remainder of the year. And the last thing of the puzzle is definitely the costs.

而且您也注意到了，我們的毛利率擴張之旅一直在成長，我們也將繼續這趟旅程。因此，我預計毛利率將徘徊在當前水準左右，並且在今年剩餘時間內會更高。而最後一個難題肯定是成本。

As I explained just now, I think Q1 is a little bit of an outlier in the whole cost story, which we have communicated before. But as a full year perspective, we're expecting the full year cost for G&A plus R&D plus marketing expenses to be in line or lower than the 2024 full year cost, right?

正如我剛才解釋的那樣，我認為 Q1 在整個成本故事中有點異常，我們之前已經溝通過這一點。但從全年角度來看，我們預計 G&A 加上研發加上行銷費用的全年成本將與 2024 年全年成本持平或更低，對嗎？

And with that, I think we are going to try to offset the tariff cost headwinds with operating efficiency gains. So hopefully, that will not have any negative impact on our gross margin. And we are quite confident that 2025 would be, as Wang mentioned, a fruitful year for us if we execute as we planned.

因此，我認為我們將嘗試透過提高營運效率來抵消關稅成本的不利影響。所以希望這不會對我們的毛利率產生任何負面影響。正如王總所說，我們非常有信心，如果我們按照計畫執行，2025 年將會是我們碩果累累的一年。

Many thanks.

非常感謝。

Okay.

好的。

Since there are no further questions, now I'd like to turn the call back over to the company's IR Director, Grace Zhang, for closing remarks.

由於沒有其他問題，現在我想將電話轉回給公司的投資者關係總監 Grace Zhang 進行結束語。

Thank you once again for joining us today. If you have further questions, please feel free to contact Zepp Health's Investor Relations department through the contact information provided on our IR website. Thank you.

再次感謝您今天加入我們。如果您還有其他問題，請隨時透過我們的 IR 網站上提供的聯絡資訊聯絡 Zepp Health 的投資者關係部門。謝謝。

Thank you.

謝謝。

This concludes the conference call. You may now disconnect your lines. Thank you.

電話會議到此結束。現在您可以斷開線路了。謝謝。