111, Inc. Announces Fourth Quarter and Fiscal Year 2024 Financial Results

Achieved First-Ever Annual Operating Profit

Bottom Line Improved by RMB332.7 Million YoY in 2024

Operating Expenses as a Percentage of Revenues Decreased 230 Basis Points YoY in 2024

Q4'24 Operating Expenses as a Percentage of Revenues Decreased 470 Basis Points YoY

Achieved First-Ever Annual Positive Operating Cash Flow

SHANGHAI, March 20, 2025 /PRNewswire/ -- 111, Inc. ("111" or the "Company") (NASDAQ:YI), a leading tech-enabled healthcare platform company committed to reshaping the value chain of healthcare industry by digitally empowering the upstream and downstream in China, today announced its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2024.

Fourth Quarter 2024 Highlights

Net revenues were RMB3.8 billion (US$527.1 million) and gross segment profit (1) was RMB202.5 million (US$27.7 million). Due to an unfavorable macroeconomic environment, net revenues and gross segment profit had a 6.3% and 5.5% decrease respectively.

Total operating expenses were RMB209.8 million (US$28.7 million), an improvement of 50.1% compared to RMB420.8 million in the same quarter of 2023. As a percentage of net revenues, total operating expenses decreased by 470 basis points to 5.5% from 10.2% in the same quarter of 2023, demonstrating continuous improvement in the Company's operational efficiency.

Loss from operations was RMB7.3 million (US$1.0 million), representing an improvement of 96.5% from RMB206.5 million in the same quarter of 2023. As a percentage of net revenues, loss from operations accounted for 0.2% in the quarter, down from 5.0% in the same quarter of 2023.

Non-GAAP loss from operations (2) was RMB2.3 million (US$0.3 million), representing an improvement of 95.8% from RMB55.2 million in the same quarter of 2023. As a percentage of net revenues, Non-GAAP loss from operations accounted for 0.1% in the quarter, down from 1.3% in the same quarter of 2023.

Fiscal Year 2024 Highlights

Net revenues were RMB14.4 billion (US$2.0 billion) and gross segment profit was RMB829.2 million (US$113.6 million). Net revenues and gross segment profit had a 3.7% and 2.3% decrease respectively.

Total operating expenses were RMB827.1 million (US$113.3 million), an improvement of 31.0% compared to RMB1.2 billion in the previous year. As a percentage of net revenues, total operating expenses decreased by 230 basis points to 5.7% from 8.0% a year ago.

Income from operations was RMB2.1 million (US$0.3 million), compared to loss from operations of RMB350.1 million in 2023 to achieve first-ever annual operating profit.

Non-GAAP income from operations was RMB22.3 million (US$3.0 million), compared to non-GAAP loss from operations of RMB123.9 million in 2023.

Net cash from operating activities was RMB263.0 million (US$36.0 million), achieving first-ever positive operating cash flow for a year.

Cash and cash equivalents, restricted cash and short-term investments amounted to RMB518.3 million (US$71.0 million) as of December 31, 2024.

 

(1)                Gross segment profit represents net revenues less cost of goods sold.

(2)                Non-GAAP loss (income) from operations represents loss (income) from operations excluding share-based compensation expenses.

Mr. Junling Liu, Co-Founder, Chairman, and Chief Executive Officer of 111, commented, "2024 was a year of both challenges and transformation. The macroeconomic environment and ongoing healthcare reforms created headwinds across the industry, pressuring consumer spending, retail pharmacy sales, and profitability while also intensifying competition. Despite these challenges, we successfully navigated the evolving market landscape to achieve a historic milestone—our first-ever annual operational profitability and positive operating cash flow. Notably, income from operations for the full year 2024 was RMB2.1 million, a significant turnaround from an operating loss of RMB350.1 million in 2023. This solid performance underscores the resilience of our business model and our strategic execution in becoming the most efficient tech-enabled healthcare e-commerce platform."

"Our relentless focus on operational efficiency continues to drive impressive improvements through cost optimization and strategic infrastructure investments. In Q4, total operating expenses accounted for 5.5% of revenues, down 470 basis points year over year, while on a non-GAAP basis, the ratio fell 130 basis points to a record-low 5.3%. For full-year 2024, our operating expense ratio declined 230 basis points to 5.7%, while the non-GAAP ratio dropped 90 basis points to 5.6%."

"Meanwhile, we made further strides in supply chain management, primarily by streamlining logistics, reducing delivery times, and lowering costs through our Kunpeng Network, which now operates 28 transportation routes across our five major geographic super hubs. Our continued investments in AI-driven solutions and digital tools have also strengthened operational efficiency while enhancing customer engagement."

"While challenges remain, we believe the most difficult period is now behind us. Looking ahead into 2025, we remain confident in the long-term growth opportunities driven by the digitalization of healthcare, the transition of pharmaceutical sales toward retail pharmacies, and the rising healthcare needs of China's aging population. We will continue to invest in AI and digital technologies to further cement our competitive position, elevate operational efficiency, and empower the entire healthcare value chain. Our strategy also focuses on bolstering supply chain capabilities and stimulating demand through deepened customer engagement. With a robust technology foundation, an efficient supply chain, and an unwavering commitment to pioneering seamless one-stop shopping experiences in this sector, we are well positioned to seize new opportunities, drive sustainable growth, and enhance profitability in the quarters ahead."

Fourth Quarter 2024 Financial Results

Net revenues were RMB3.8 billion (US$527.1 million), representing a decrease of 6.3% from RMB4.1 billion in the same quarter of 2023.

(In thousands RMB)

For the three months ended December 31,

2023

2024

YoY

B2B Net Revenue

Product

3,996,772

3,759,824

-5.9 %

Service

24,045

21,771

-9.5 %

Sub-Total

4,020,817

3,781,595

-5.9 %

Cost of Products Sold(3)

3,821,868

3,592,588

-6.0 %

Segment Profit

198,949

189,007

-5.0 %

Segment Profit %

4.9 %

5.0 %

(In thousands RMB)

For the three months ended December 31,

2023

2024

YoY

B2C Net Revenue

Product

85,578

62,480

-27.0 %

Service

2,231

3,700

65.8 %

Sub-Total

87,809

66,180

-24.6 %

Cost of Products Sold

72,504

52,705

-27.3 %

Segment Profit

15,305

13,475

-12.0 %

Segment Profit %

17.4 %

20.4 %

(3) For segment reporting purposes, purchase rebates are allocated tothe B2B segment and B2C segments primarily based on the amount of cost of products sold for each segment. Cost of products sold does not include other direct costs related to cost of product sales such as shipping and handling expense, payroll and benefits of logistic staff,logistic centers rental expenses and depreciation expenses, which are recorded in the fulfillment expenses. Cost of service revenue is recordedin the operating expense.

Operating costs and expenses were RMB3.9 billion (US$528.1 million), representing a decrease of 10.7% from RMB4.3 billion in the same quarter of 2023.

Cost of products sold was RMB3.6 billion (US$499.4 million), representing a decrease of 6.4% from RMB3.9 billion in the same quarter of 2023.

Fulfillment expenses were RMB104.5 million (US$14.3 million), representing an increase of 3.1% from RMB101.3 million in the same quarter of 2023. Fulfillment expenses accounted for 2.7% of net revenues this quarter as compared to 2.5% in the same quarter of 2023.

Selling and marketing expenses were RMB76.2 million (US$10.4 million), representing a decrease of 56.1% from RMB173.5 million in the same quarter of 2023. Excluding the share-based compensation expenses of RMB1.8 million for the quarter and RMB66.3 million for the same quarter of 2023, respectively, selling and marketing expenses as a percentage of net revenues accounted for 1.9% in the quarter as compared to 2.6% in the same quarter of 2023.

General and administrative expenses were RMB20.2 million (US$2.8 million), representing a decrease of 79.4% from RMB98.0 million in the same quarter of 2023. Excluding the share-based compensation expenses of RMB2.3 million for the quarter and RMB62.1 million for the same quarter of 2023, respectively, general and administrative expenses as a percentage of net revenues accounted for 0.5% in the quarter as compared to 0.9% in the same quarter of 2023.

Technology expenses were RMB15.4 million (US$2.1 million), representing a decrease of 68.6% from RMB49.1 million in the same quarter of 2023. Excluding the share-based compensation expenses of RMB1.0 million for the quarter and RMB22.9 million for the same quarter 2023, respectively, technology expenses as a percentage of net revenues accounted for 0.4% in the quarter as compared to 0.6% in the same quarter of 2023.

Loss from operations was RMB7.3 million (US$1.0 million), representing an improvement of 96.5% from RMB206.5 million in the same quarter of 2023. As a percentage of net revenues, loss from operations accounted for 0.2% in the quarter, down from 5.0% in the same quarter of 2023.

Non-GAAP loss from operations was RMB2.3 million (US$0.3 million), representing an improvement of 95.8% from RMB55.2 million in the same quarter of 2023. As a percentage of net revenues, non-GAAP loss from operations accounted for 0.1% in the quarter, down from 1.3% in the same quarter of 2023.

Net loss was RMB12.5 million (US$1.7 million), representing an improvement of 93.9% from RMB205.2 million in the same quarter of 2023. As a percentage of net revenues, net loss accounted for 0.3% in the quarter, down from 5.0% in the same quarter of 2023.

Non-GAAP net loss (4) was RMB7.5 million (US$1.0 million), representing an improvement of 86.0% from RMB53.9 million in the same quarter of 2023. As a percentage of net revenues, non-GAAP net loss accounted for 0.2% in the quarter, down from 1.3% in the same quarter of 2023.

Net loss attributable to ordinary shareholders was RMB19.8 million (US$2.7 million), representing an improvement of 90.6% from RMB210.4 million in the same quarter of 2023. As a percentage of net revenues, net loss attributable to ordinary shareholders accounted for 0.5% in the quarter, down from 5.1% in the same quarter of 2023.

Non-GAAP net loss attributable to ordinary shareholders (5) was RMB14.8 million (US$2.0 million), representing an improvement of 74.9% from RMB59.0 million in the same quarter of 2023. As a percentage of net revenues, non-GAAP net loss attributable to ordinary shareholders accounted for 0.4% in the quarter, down from 1.4% in the same quarter of 2023.

(4) Non-GAAP net loss represents net loss excluding share-based compensation expenses, net of tax. Considering the impact of accretion of redeemable non-controlling interest for the fourth quarter and fiscal year ended December 31, 2024, non-GAAP net loss is used as a meaningful measurement of the operation performance of the Company.

(5) Non-GAAP net loss attributable to ordinary shareholders represents net loss attributable to ordinary shareholders excluding share-based compensation expenses, net of tax.

Fiscal Year 2024 Financial Results

Net revenues were RMB14.4 billion (US$2.0 billion), representing a decrease of 3.7% from RMB14.9 billion in the previous year.

(In thousands RMB)

For the year ended December 31,

2023

2024

YoY

B2B Net Revenue

Product

14,483,935

14,033,543

-3.1 %

Service

86,831

89,609

3.2 %

Sub-Total

14,570,766

14,123,152

-3.1 %

Cost of Products Sold

13,801,172

13,357,617

-3.2 %

Segment Profit

769,594

765,535

-0.5 %

Segment Profit %

5.3 %

5.4 %

(In thousands RMB)

For the year ended December 31,

2023

2024

YoY

B2C Net Revenue

Product

357,975

261,197

-27.0 %