Chinese selfie app maker Meitu H1 loss narrows as revenue surges

[HONG KONG] Chinese selfie app maker Meitu Inc on Thursday reported a 272 per cent surge in first-half revenue on strong demand from female consumers.

The company, which makes beauty-enhancing apps and smartphones, said its adjusted net loss in the six months ended June narrowed by 87 per cent to 33 million yuan (S$6.75 million).

Revenue rose to 2.18 billion yuan, thanks to higher income from handset sales and a 762 per cent surge in revenues from internet services and others.

That business segment, which includes online advertising, e-commerce and virtual item sales, turned profitable at the gross level for the first time, Meitu said. It rose to account for 11.3 per cent of Meitu's revenue, up by 6.4 per centage points.

Meitu generated the rest of its income from selling its beauty-enhancing smartphones Meitu M8 and the high-priced T8 that had a retail price tag of US$495.

Meitu got listed on the Hong Kong Stock Exchange in December. Its shares have risen 55 per cent this year, against a 25 per cent rise in the benchmark Hang Seng Index.

Meitu said it still expected to incur a net loss for the year due to planned investment, adding it had generated net profits in the months of March and May.

"We believe that in order to maximise long-term shareholder value, it is necessary to accelerate investment, mostly in terms of expenses, in the second half of 2017, of our people, technology and user growth," chairman Cai Wensheng said in a statement.

REUTERS