FangDD H1 2024: Stagnant Results as Chairman Cites Economic Downturn

The Chinese real estate portal operator FangDD has released its unaudited half-year financial statement for the 2024 financial year, with Chairman Xi Zeng commenting that the Chinese market has experienced a "second bottoming-out" as results stagnated after a promising 2023.

Highlights include:

• Revenues of RMB 140 million ($19.3 million), down 8.8% year-on-year
• Gross profit decreased to RMB 17.5 million ($2.5 million), down 11.9% YoY
• Total GMV decreased to RMB 6.2 billion ($884.2 million)
• A small net profit of $2.3 million essentially means breakeven for the period
• FangDD retains cash reserves of circa $21.2 million
• HY2 forecast for a slight market stabilization and sales worth RMB 10 trillion ($1.4 trillion)

FangDD, not to be confused with its rival Fang, has suffered significant losses and revenue since the 2020 Covid-19 pandemic which has seen disastrous (and widespread) downturns across China's entire economy.

In context, FangDD's full-year revenues have been almost literally decimated (cut down to 1/10 the size) in the past three years:

The headline takeaway is that FangDD has remained profitable, if only nominally, for the period.

Unfortunately for FangDD, it appears amidst another economic downturn as the firm's financial results stagnated compared to last year, with either small growth or small decline across most major metrics.

Xi Zeng, chairman and CEO of FangDD, said that the numbers coming out of China's National Bureau of Statistics saw a 20% decline in new property sales compared to H1 2023, while the value of those transactions also fell by 25% on average.

"This decline in both market volume and value has led to a 'second bottoming out'," said Zeng.

In March 2024, FangDD's share price jumped 80% when it revealed an updated strategy focusing on real estate stock asset services, as opposed to relying primarily on property transactions.

FangDD has been transparent about wanting to future-proof its strategy and warned of potential financial losses while it enacts this change when it released its full-year results in April.

Meanwhile, in June the company entered an agreement to purchase certain patents related to cloud computer technology in China to the tune of circa $35 million.