Viomi Technology Co., Ltd (VIOT) Q4 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call presents a mixed picture. Positive aspects include a 14.6% increase in net revenue and optimistic guidance on overseas expansion. However, a decline in gross margin, increased operating expenses, and lack of clarity on some strategic initiatives temper enthusiasm. The Q&A highlights management's optimism about international growth but also reveals uncertainties in market strategies and challenges. Overall, the sentiment is balanced, leading to a neutral prediction for stock price movement.
Key Financial Performance
Total Revenue (Second Half 2025) RMB 951 million, a decrease of 25.9% year-over-year from RMB 1,282.4 million in 2024, primarily due to the decrease in the home water systems.
Net Income Attributable to Ordinary Shareholders (Second Half 2025) RMB 21.2 million, no year-over-year comparison provided.
Total Revenue (Full Year 2025) RMB 2.4 billion, an increase of 14.6% year-over-year from RMB 2,119 million in 2024, attributed to solid core business performance.
Net Income Attributable to Ordinary Shareholders (Full Year 2025) RMB 141.6 million, no year-over-year comparison provided, with a net profit margin of 5.8%.
Revenues from Home Water Systems (Second Half 2025) RMB 628.2 million, a decrease of 32.1% year-over-year from RMB 925.7 million in 2024, primarily due to the decline in service for water purifiers.
Revenues from Consumables (Second Half 2025) RMB 112.2 million, a decrease of 17.9% year-over-year from RMB 133.7 million in 2024, primarily due to decreased sales of water purifier filters to Xiaomi.
Revenues from Kitchen Appliances and Others (Second Half 2025) RMB 210.2 million, a decrease of 4.5% year-over-year from RMB 220 million in 2024, primarily due to the reduction in orders from Xiaomi and contraction of Viomi brand products in this category.
Gross Profit (Second Half 2025) RMB 223.8 million, compared to RMB 289.5 million in 2024. Gross margin was 23.5%, up from 22.6% in 2024, mainly due to the elimination of one-off costs incurred during the divestment of certain IoT at home business and assets.
Total Operating Expenses (Second Half 2025) RMB 248 million, an increase of 12% year-over-year from RMB 221.5 million in 2024, due to increased selling and marketing expenses, partially offset by decreased G&A expenses.
R&D Expenses (Second Half 2025) RMB 76.3 million, an increase of 12.7% year-over-year from RMB 67.7 million in 2024, mainly attributable to increased investment in new product development.
Selling and Marketing Expenses (Second Half 2025) RMB 148.6 million, an increase of 29.8% year-over-year from RMB 114.6 million in 2024, mainly due to increased brand promotion investment and higher personnel costs from channel expansion.
G&A Expenses (Second Half 2025) RMB 23.1 million, a decrease of 41.2% year-over-year from RMB 39.3 million in 2024, primarily due to decreased employee compensation costs.
Net Revenue (Full Year 2025) RMB 2,428.2 million, an increase of 14.6% year-over-year from RMB 2,119 million in 2024.
Revenues from Home Water Systems (Full Year 2025) RMB 1,686.6 million, an increase of 12.6% year-over-year from RMB 1,498.4 million in 2024.
Revenues from Consumables (Full Year 2025) RMB 235.4 million, a decrease of 14.2% year-over-year from RMB 277.7 million in 2024.
Revenues from Kitchen Appliances and Others (Full Year 2025) RMB 506.2 million, an increase of 47.6% year-over-year from RMB 342.9 million in 2024.
Gross Profit (Full Year 2025) RMB 615 million, compared to RMB 548.7 million in 2024. Gross margin was 25.3%, slightly down from 25.9% in 2024.
Total Operating Expenses (Full Year 2025) RMB 529.4 million, an increase of 24.6% year-over-year from RMB 424.9 million in 2024.
R&D Expenses (Full Year 2025) RMB 165.6 million, an increase of 15.9% year-over-year from RMB 142.9 million in 2024.
Selling and Marketing Expenses (Full Year 2025) RMB 277.7 million, an increase of 31.5% year-over-year from RMB 211.2 million in 2024.
G&A Expenses (Full Year 2025) RMB 86.1 million, an increase of 21.6% year-over-year from RMB 70.8 million in 2024.
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Operating Highlights
Master 1 Mineral Water Purifier: Introduced as a premium flagship product, enriching the product portfolio.
INNO Mineral Water Dispenser: Launched in Southeast Asia, tailored for the local market with mineralization and cooling functions.
North American Market: Achieved triple-digit growth in Amazon channel sales sequentially. Products ranked 19th in water purifier category and 4th in under-sink RO tankless segment during Black Friday.
Southeast Asia Market: Deepened strategic cooperation with offline channels in Malaysia.
Water Purifier Gigafactory: Commenced full operations of overseas premium production line, integrating instant heating, cooling, and ice-making functions to support agile supply chain needs.
Global Patent Applications: Surpassed 1,950 patents across 14 countries and regions, focusing on AI-driven water quality algorithms, precision mineral control, and intelligent self-cleaning.
Global Water Strategy: Focused on expanding presence in North America and Southeast Asia, leveraging the Water Purifier Gigafactory for localized production.
AI Integration: Planned deeper integration of AI in water purification scenarios to drive technological innovation and sustained growth.
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Risk or Challenges
Revenue Decline in Home Water Systems: Net revenue from home water systems decreased by 32.1% in the second half of 2025 compared to the same period in 2024, primarily due to a decline in service for water purifiers.
Decreased Sales of Consumables: Revenues from consumables dropped by 17.9% in the second half of 2025 compared to the same period in 2024, mainly due to reduced sales of water purifier filters to Xiaomi.
Reduction in Kitchen Appliance Revenue: Revenues from kitchen appliances and other products decreased by 4.5% in the second half of 2025 compared to the same period in 2024, attributed to reduced orders from Xiaomi and contraction of Viomi brand products in this category.
Increased Operating Expenses: Total operating expenses rose by 12% in the second half of 2025 compared to the same period in 2024, driven by higher selling and marketing expenses, including increased brand promotion investments and personnel costs.
Rising R&D Costs: R&D expenses increased by 12.7% in the second half of 2025 compared to the same period in 2024, due to higher investments in new product development.
Higher Selling and Marketing Expenses: Selling and marketing expenses increased by 29.8% in the second half of 2025 compared to the same period in 2024, primarily due to increased brand promotion investments and personnel costs from channel expansion.
Decline in Gross Profit: Gross profit decreased to RMB 223.8 million in the second half of 2025 from RMB 289.5 million in the same period of 2024, despite a slight increase in gross margin.
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Guidance & Outlook
Global Water Vision for 2026: The company will focus on four key areas: deepening presence in core strategic markets such as North America and Southeast Asia, expanding into more countries and regions, and leveraging the Water Purifier Gigafactory for localized production; strengthening the health-centric positioning of the Kunlun series in the domestic market; advancing AI integration across water purification scenarios to drive technological innovation and sustained growth; and enhancing collaborations with global strategic partners to improve scale and efficiency.
New Product Launches: In April 2026, the company plans to unveil a new brand series at the WQA convention in Miami, showcasing the latest AI technologies and innovations in water treatment.
Overseas Market Expansion: The company aims to deepen its presence in North America and Southeast Asia, actively expanding into more countries and regions. The Water Purifier Gigafactory will support this expansion with agile supply chain capabilities.
Technological Advancements: The company will focus on AI-driven innovations in water purification, including water quality algorithms, precision mineral control, and intelligent self-cleaning, to enhance user experience and market competitiveness.
Brand Building: The company will continue to engage brand ambassadors and participate in global events to strengthen its brand image and market influence.
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Shareholder Return Plan
Special Dividend Declared in July 2025: A special dividend of USD per ADS was declared in July 2025.
Special Dividend Declared in August 2025: Another special dividend of USD 0.066 per share was declared, amounting to an aggregated RMB 31 million.
Share Repurchase Program Authorized: A new share repurchase program of USD 20 million was authorized by the end of 2025.
Shares Repurchased: A total of 1.03 million ADS were repurchased, amounting to approximately USD 2.5 million.
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Key Q&A
Q:Could you share the overall performance of the company's self-owned brand, Viomi in 2025? What are the key investment priorities and initiatives for Viomi's brand building this year?
A:In 2025, Viomi's brand revenue was primarily from domestic online channels. The brand ranked 10th among annual brands on Jingdong and 19th in sales on Amazon U.S.A. Moving forward, the company plans to adopt a differentiated strategy in North America by launching distinct brands and positioning on online and offline channels. They will participate in the World of Coffee Fair in San Diego and debut a new brand series at the WQA Convention in Miami, marking their entry into the North American offline market.
Q:What are the differences in your market strategies between the U.S. and Malaysia? What key challenges have you encountered, and how do you plan to mitigate them? Could you outline the overseas expansion goals for 2026?
A:In the U.S., Viomi focuses on online channels with under-sink water purifiers on Amazon and plans to introduce new brands and products for offline markets, including whole house filtration systems. In Malaysia, the focus is on offline channels with countertop units tailored to local drinking habits. Challenges include geopolitical tensions and uncertainties in overseas markets. For 2026, the company expects triple-digit growth in overseas revenue.
Q:What are the core pathways for further enhanced profitability and sustaining positive momentum for the next 2 to 3 years?
A:The company plans to expand overseas markets and grow the Viomi branded business to improve margins. Consumable revenues from Viomi products will be a long-term driver, kicking in 1-2 years after equipment sales. They will also broaden their product lineup with higher-margin products like countertop options and whole home filtration systems.
Q:Can you analyze the impact of the national subsidy reduction on the domestic market and forecast future impacts? What is the top-line contribution of the cooperation with China Gas?
A:The national subsidy reduction in 2025 negatively impacted revenue, and challenges are expected in the first half of 2026. However, demand for water purifiers is growing, and the market is expected to return to normal growth in 2026. Cooperation with China Gas and similar companies is seen as an efficient way to enter lower-tier markets, with 2026 being a pilot year for this partnership, expected to bring incremental growth.
Q:What is the normalized growth rate for the business over the next 3 to 5 years?
A:The industry’s normal growth rate is estimated to be high single digits without subsidy impacts. Viomi's growth rate is expected to be higher due to brand strength and international market expansion. Overall, the company anticipates low double-digit growth by 2027.
Q:Review of Unclear Management Responses
A:Management avoided providing specific details on the exact challenges faced in overseas markets and how they plan to mitigate them beyond general statements about geopolitical tensions and uncertainties. Additionally, the response about the cooperation with China Gas lacked clarity on the expected financial impact or specific growth targets.
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
Capital Investment
Conference Full
Europe
GA
Gap
Global
Investment Department
Limited Conference
Mr Xiaoping
North America
Purifier Gigafactory
RD increase
Revenues kitchen
Southeast Asia
USD share
Viomi Technology
Viomi press
Water Purifier
brand building
breakthrough
country region
decrease period
dividend USD
event
founder remark
front
function
health
income
increase period
period increase
shareholder return
VIOT Transcript
Viomi Technology Co., Ltd (VIOT) Presents at Deutsche Bank ADR Virtual Investor Conference Transcript
Neutral4-28
Viomi Technology Co., Ltd (VIOT) Q4 2025 Earnings Call Transcript
Unknown3-25
The earnings call presents a mixed picture. Positive aspects include a 14.6% increase in net revenue and optimistic guidance on overseas expansion. However, a decline in gross margin, increased operating expenses, and lack of clarity on some strategic initiatives temper enthusiasm. The Q&A highlights management's optimism about international growth but also reveals uncertainties in market strategies and challenges. Overall, the sentiment is balanced, leading to a neutral prediction for stock price movement.
Viomi Technology Co., Ltd (VIOT) Presents at Deutsche Bank ADR Virtual Investor Conference 2025 Transcript
Neutral11-4
Viomi Technology Co., Ltd (VIOT) Q4 2024 Earnings Call Transcript
Positive3-25
The company reported strong revenue growth, especially in home water systems, and a turnaround to profitability. Strategic partnerships and successful U.S. market entry are positive indicators. Despite lower gross margins, management's optimism about future improvements and strategic initiatives suggest a positive outlook. The lack of clarity on long-term goals and specific metrics is a minor concern but doesn't overshadow the overall positive sentiment from the earnings call.
VIOT Report
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