On August 18, Huami Technology (NYSE:HMI) released its second quarter 2020 financial report: the company’s revenue reached 1.137 billion yuan (161 million US dollars), a year-on-year increase of 9.5%, exceeding the previously issued revenue guidance ceiling . Total shipments reached 8.9 million units, an increase of 7.2% from the 8.3 million units in the second quarter of 2019.
“Faced with the severe challenges of the global epidemic, our team and brand achieved a revenue growth of 9.5% in the second quarter and a revenue growth of 21.1% throughout the first half of the year. I am proud of them.” Huami Technology founder, Chairman and CEO Huang Wang said that Huami Technology continued to expand its product categories in the first half of the year. The newly launched smart health devices including new smart watches and sports headphones have been recognized by consumers, helping the company achieve continuous increase.
Huang Wang believes that the performance in the first half of the year reflects Huami Technology’s growing brand recognition, effective sales and marketing strategies, and excellent value proposition. According to the IDC report, in the first quarter of this year, Huami Technology’s Amazfit brand products ranked fifth in global shipments, and sales growth in the United States, Western Europe and Southeast Asia reached triple digits. In the second quarter, Huami Technology’s overseas performance was eye-catching, with overseas version products already accounting for 47.9% of total shipments; throughout the first half of the year, overseas shipments accounted for 55.8% of total shipments.
The financial report shows that Huami Technology’s research and development expenses in the second quarter of 2020 are 117.2 million yuan, an increase of 25%, and its share of revenue has exceeded 10%. These investments are mainly reflected in increasing R&D personnel and expanding R&D activities, which will accelerate the development of new products and new categories; Huami Technology is expected to launch a variety of new products in the second half of 2020.
At the first AI Innovation Conference held in June this year, Huami Technology not only officially upgraded its artificial intelligence laboratory to an artificial intelligence research institute, but also released a new generation of smart wearable chips “Huangshan No. 2” and a series of new biological Sensors and health big data AI algorithms, thus building a complete set of AI health management technology architecture; new products using the “Huangshan No. 2” chip are planned to be launched in the first quarter of 2021.
At the same time, Huang Wang also introduced that in July this year, Huami’s wholly-owned subsidiary PAI Health announced an agreement with Prudential Corporation Asia to incorporate PAI Health (Personal Health Assessment System) into Prudential’s Pulse Digital health application. This will provide Prudential members in 11 Asian markets with new heart health analysis services. This is also a direct manifestation of the company’s mission “Technology Connects Health”.
Looking forward to the third quarter of this year, the management of Huami Technology predicts that net revenue will reach RMB 2.1 billion to RMB 2.15 billion, an increase of approximately 12.9% to 15.6% from RMB 1.86 billion in the third quarter of 2019. Huang Wang said, “We are confident that product shipments will continue to rise in the second half of the year, and we also look forward to bringing more value to all users.”