BEIJING - KE Holdings Inc. (NYSE: BEKE), a prominent online and offline housing transaction and services platform, announced its financial results for the first quarter ended March 31, 2024.
The company reported first-quarter earnings per share (EPS) of $1.21, surpassing the analyst consensus of $0.98 by $0.23. Revenue for the quarter was $16.4 billion, exceeding the consensus estimate of $16 billion.
Despite the earnings beat, KE Holdings' stock fell by 3.5%, indicating investor concern. The revenue decline of 19.2% from the same quarter last year reflects a broader contraction in the housing market. Gross transaction value (GTV) experienced a significant year-over-year (YoY) decrease of 35.2%, with existing home transactions and new home transactions falling by 31.8% and 45.4% respectively.
The company's CEO, Mr. Stanley Yongdong Peng, commented on the market conditions, stating, "As the existing housing market plays an increasingly important role, China's real estate industry is accelerating its transformation into a new era." He highlighted the company's efforts to innovate and enhance its service capabilities in response to changing customer needs.
Mr. Tao Xu, Chief Financial Officer, provided further insights, explaining the year-over-year decline in the housing market as a result of high performance in the previous year due to pent-up demand post-pandemic. He noted the stability of the existing home market compared to typical first-quarter performance and emphasized the company's focus on shareholder returns and capital operation efficiency.
In terms of operational metrics, the number of stores increased by 7.1% YoY, and the number of active stores grew by 7.5%. However, the number of active agents saw a decrease of 3.0% from the previous year. Mobile monthly active users (MAU) averaged 47.7 million in the first quarter of 2024, showing an increase from 45.4 million in the same period of 2023.
The company's strategic shift towards a "one body, three wings" approach has seen growth in revenues from home renovation and furnishing, home rental services, and emerging and other services, which collectively grew by 112.9% YoY. This diversification strategy appears to be a response to the challenging market conditions in the housing transaction sector.
KE Holdings remains committed to refining its capital structure and has allocated approximately US$220 million to share repurchases in the first quarter, as part of its ongoing efforts to enhance shareholder value.
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