BEKE(BEKE) - 2024 Q1 - Quarterly Results

Financial Performance - Gross transaction value (GTV) decreased by 35.2% year-over-year to RMB629.9 billion (US$87.2 billion) in Q1 2024, with existing home transactions down 31.8$2.3 billion) in Q1 2024, primarily due to declines in existing and new home transaction services[9]. - Net income was RMB432 million (US$60 million) in Q1 2024, with adjusted net income at RMB1,392 million (US$193 million)[2]. - Total net revenues for the three months ended March 31, 2024, were RMB 16,377,314, down from RMB 20,278,080 for the same period in 2023, representing a decline of approximately 19%[51]. - The gross profit for the three months ended March 31, 2024, was RMB 4,122,086, compared to RMB 6,349,798 for the same period in 2023, indicating a decrease of about 35%[51]. - KE Holdings Inc. reported a net income of RMB 432,122 for the three months ended March 31, 2024, compared to RMB 2,749,746 for the same period in 2023, reflecting a significant decline[51]. - Adjusted net income for the three months ended March 31, 2024, was RMB 3,561,263 thousand (approximately US$192,818 thousand), compared to RMB 2,749,746 thousand in the same period of 2023[59]. Revenue Breakdown - Revenue from home renovation and furnishing increased by 71.1$0.3 billion), driven by synergies with home transaction services[13]. - Revenue from home rental services surged by 189.3% year-over-year to RMB2.6 billion (US$0.4 billion), attributed to the growth of rental units under the Carefree Rent model[14]. - Net revenues from existing home transaction services for the three months ended March 31, 2024, were RMB 9,181,199 thousand, with a contribution of RMB 4,501,720 thousand[66]. - New home transaction services generated net revenues of RMB 8,404,084 thousand, contributing RMB 2,272,348 thousand for the same period[66]. - Home renovation and furnishing services reported net revenues of RMB 1,407,931 thousand, with a contribution of RMB 431,012 thousand[66]. - Home rental services generated net revenues of RMB 907,354 thousand, with a contribution of RMB (81,490) thousand, indicating a loss in this segment[66]. Operating Expenses - Total operating expenses increased by 21.9$0.6 billion) in Q1 2024 from RMB3.4 billion in Q1 2023[19]. - General and administrative expenses rose by 24.5% to RMB2,019 million (US$280 million) in Q1 2024 compared to RMB1,621 million in Q1 2023[20]. - Sales and marketing expenses increased by 25.5$225 million) in Q1 2024 from RMB1,294 million in Q1 2023[20]. Cash and Investments - As of March 31, 2024, the combined balance of cash, cash equivalents, restricted cash, and short-term investments was RMB60.8 billion (US$8.4 billion)[26]. - Cash and cash equivalents decreased to RMB 17,845,299 as of March 31, 2024, from RMB 19,634,716 as of December 31, 2023[45]. - The company’s long-term investments decreased to RMB 20,658,437 as of March 31, 2024, from RMB 23,570,988 as of December 31, 2023[45]. - The company reported a net increase in cash and cash equivalents of RMB 12,860,096 thousand for the three months ended March 31, 2024[64]. Shareholder Returns - The company allocated approximately US$220 million to share repurchases in Q1 2024, aiming to enhance shareholder returns[7]. - The company has established a share repurchase program allowing for the purchase of up to US$2 billion of its Class A ordinary shares and/or ADSs until August 31, 2024[29]. - Approximately 76.6 million ADSs (representing about 229.8 million Class A ordinary shares) have been purchased under the share repurchase program for a total consideration of approximately US$1,129.8 million[30]. Strategic Initiatives - The "one body, three wings" strategy is being actively advanced to adapt to the evolving market environment[6]. - The company will separately report the financials of home rental services starting Q1 2024 to enhance understanding of revenue structure and margin trends[27]. Assets and Liabilities - As of March 31, 2024, KE Holdings Inc. reported total assets of RMB 119,021,436, a decrease from RMB 120,331,931 as of December 31, 2023[45]. - Total current liabilities increased to RMB 41,755,435 as of March 31, 2024, from RMB 39,523,983 as of December 31, 2023, representing an increase of approximately 6%[46]. - The company’s total shareholders' equity decreased to RMB 69,124,976 as of March 31, 2024, from RMB 72,201,105 as of December 31, 2023[50].