WEIMOB INC's H1 Revenue Returns to Growth, AI Application Revenue Surges Nearly 90% Year-on-Year

On the evening of August 18, WEIMOB INC released its unaudited interim results.

The company reported revenue of RMB 869.4 million, a year-on-year increase of 12.1%; gross profit was RMB 612.1 million, up 5.1%, while the gross margin declined from 75.1% to 70.4%. The loss for the period amounted to RMB 181.6 million, compared to a loss of RMB 47.2 million in the same period last year. On a non-HKFRS basis as disclosed in the announcement, the adjusted net profit was RMB 4.8 million, a year-on-year decrease of 34.2%.

After a 10.6% decline in revenue in the first half of last year, WEIMOB's revenue this year has slightly exceeded the RMB 867.4 million recorded in the same period of 2024. The current gross margin is higher than the 66.4% seen in the same period of 2024, but 4.7 percentage points lower than that of the same period in 2025. Revenue recovery is outpacing the improvement in earnings quality.

WEIMOB describes its strategic direction as transforming from a traditional SaaS company into an "AI-Native Business Service Provider."

Disclosures for the period show that AI has been integrated into three business lines. Within the core SaaS business, the original WAI has been upgraded to "Xingyuan," embedding natural language interaction and task execution into retail software. In precision marketing, the "Tian" series of tools covers the entire marketing process. Beyond the core business, the company listed four AI-Native products: Xingqi GEO, Xingtuo, Xingshu, and Xinchuang WIMO. Among these, Xingqi GEO extends into brand generative search marketing.

Following the integration of AI into its products, revenue contribution has begun to rise.

Based on the comparative basis of this announcement, revenue from AI applications increased from RMB 70.3 million to RMB 133.1 million, a year-on-year growth of 89.2%, surpassing the full-year 2025 figure of RMB 116.1 million. Its proportion of revenue in the "SaaS and AI" segment rose from approximately 16.1% to 28.8%, accounting for about 15.3% of the group's total revenue. From a product architecture perspective, WEIMOB has clearly undergone AI transformation; from a revenue structure perspective, AI is a significant source of incremental growth but has not yet become the main revenue driver.

The group's revenue increased by RMB 93.9 million year-on-year. Of this, AI applications contributed an increase of RMB 62.8 million, accounting for approximately two-thirds of the total increment. Precision marketing revenue increased by about RMB 70.4 million, offsetting the RMB 39.3 million decline in SaaS products. The number of paying SaaS merchants continued to decrease by 7.1% to 54,970, and smart retail revenue fell by 3.8% to RMB 275 million, although the number of brand merchants remained largely stable.

The current primary constraint lies in gross margin. The cost of sales for the SaaS and AI business grew by 42.2% to RMB 232.8 million, causing the segment's gross margin to drop from 62.6% to 49.5%. Specifically, the gross margin for AI applications fell from 16.4% to 13.8%. Precision marketing revenue grew by 20.9% to RMB 408.1 million, with its gross margin rising from 91.3% to 94.0%. The gross profit growth in this business offset the decline in SaaS and AI gross profit, allowing the group's overall gross profit to continue increasing.

The trend in precision marketing revenue does not align with advertising volume. In the first half of the year, gross advertising revenue was RMB 7.7223 billion, a decrease of 10.4%. The number of paying merchants increased by 4.0%, while the average spending per paying user decreased by 13.9%.

The company stated that it stopped serving some customers with low gross margins, high advance payments, or long payment terms, leading to an increase in net rebates from advertising platforms. Since revenue in this segment mainly comes from platform rebates and service commissions, the growth reflects more of an improvement in customer structure and operational efficiency rather than an expansion in total advertising volume.

Profitability and cash flow remain under pressure. In the non-HKFRS adjustment table, the company added back RMB 109.4 million in share-based payments and RMB 41.4 million in tax impacts. Adjusted EBITDA still decreased by 8.2% to RMB 56.3 million.

However, according to the company's metrics, adjusted net profit has been positive for three consecutive semi-annual periods. As of the end of June, the company had cash and bank deposits of approximately RMB 1.995 billion. Net cash outflow from operating activities was RMB 397.4 million, compared to an outflow of RMB 28.06 million in the same period last year. The company attributed this to short-term capital occupation resulting from the expansion of new channels for precision marketing.

Overall, WEIMOB's product system has clearly undergone AI transformation. AI applications have moved from the technology investment phase to the revenue validation phase, and improvements in precision marketing efficiency are providing profit support for the transformation.

However, given that AI applications have not yet become the main revenue source, gross margins are relatively low, and operating cash flow has weakened, it is premature to claim that the "transformation is complete." The next step is to observe whether gross margins and cash collection can improve in tandem as AI revenue increases.