So-Young Publishes Q2 Results, Shares Plummet Nearly 20%
COVID-19 and China
Image: Credit to Ishant Mishra on Unsplash

So-Young (新氧) (SY: NASDAQ) published Q2 results: the company could maintain its high margins after the IPO with 82.5% in Q2.

The total number of paying users were 201,500, an increase of 118.8% from 92,100 in the second quarter of 2018, yet the number of paying medical service providers on So-Young’s platform was 3,157, an increase of 39.4% from 2,265 in the second quarter of 2018, that is a slower growth compere to the previous periods.  

The company have not faced with a significant regulatory or branding crisis during the period, except one to two insignificant branding cases, and could expand its operational scope. The aggregate value of medical aesthetic treatment transactions facilitated by So-Young’s platform was CNY 892.9 million, an increase of 81.9% from CNY 491.0 million in the second quarter of 2018.

The growth in operational capacity and surging paying users should not be regarded as an increasing market share of So-Young; instead, we are estimating that the market has been expanding during the period since parallel operational jumps observed in the company's competitors Gengmei (更美) and Yuemei, as well. 

As expected, the company's most significant expenses are marketing-related, So-Young poured CNY 105 million into marketing; however, did not specify the details in the report.​​​​

The market size of China's Medical Aesthetic sector is set to reach CNY 481 billion in 2022, Deloitte estimates. 

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