Quhuo Limited Q4 FY2022 earnings call

• In 2021, the company proposed a strategy to improve profitability after increasing revenues. By 2022, they achieved full-year revenue growth of 56% in 2021 and gross profit growth of 43.9% in 2022.
• Initiatives included expansion in on-demand delivery solutions, growth in mobility service solutions, and deepening housekeeping and accommodation solutions. Despite COVID-19 impacts, they maintained stable income and saw profit increases.
• Full-year 2022 revenue was RMB3,820.4 million with gross profit of RMB252.7 million, resulting in a gross margin of 6.6%.
• Achieved historical turnarounds in operating income, adjusted EBITDA, and adjusted net income. The business model is sustainable with an average payback period of about 12 months.
• In 2023, the company launched international business in February, aiming to export industry plus Internet products and services overseas, leveraging China's strengths.

Quhuo Limited has two main product segments. The first is order fulfillment services for platforms, which generated revenue of RMB3.474 billion in 2022. The second is housekeeping and accommodation services provided under a SaaS service model, with full-year 2022 revenue of RMB73.6 million. The order fulfillment segment contributed significantly more to total revenue, while the housekeeping and accommodation segment had a smaller revenue contribution but is part of the company's strategy to expand services.

• The company's strategy to improve profitability after increasing revenues was effective in 2022.
• In 2023, Quhuo embarked on new expansion, officially launching international business in February, aiming to empower overseas partners with mobility service and other capabilities, expecting global business to bring new growth.

Q: What's the company strategy in 2022 to improve profitability after increasing the revenues and what's the strategy in 2023?

A: The strategy for 2021 and 2022 was to improve profitability after increasing revenues, focusing on scale increase including revenue and profit. From 2023 to 2025, the strategy is to extend the industry ecosystem to localized life, transforming from a localized life human service provider to an operation service provider. For example, the [Chantou] project has empowered over a thousand small and medium-sized homestay service providers, and in 2023, they launched international business to export industry plus Internet products and services overseas.