BOSS Zhipin: "Industry BOSS" status remains, waiting for the wind

Hello everyone, I am Dolphin Analyst!

After the Hong Kong stock market closed on May 24th Beijing time, Kanzhun.US released its Q1 2023 performance. Due to the relatively stable industry position of BOSS Zhipin, short-term monitoring of macro trends is still the key to judging BOSS Zhipin. The expectation of the current job market is quite pessimistic, and I believe everyone has some understanding of this, which is also the reason for the recent sluggish stock price trend.

However, I am more concerned about BOSS Zhipin's ability to quickly catch up in the past few years in its history. Therefore, the financial reports during the adversity period are also a touchstone for constantly testing BOSS Zhipin's core competitiveness and management capabilities.

Later, I will release the summary of the conference call to the user research group as soon as possible. Interested friends can add my WeChat account "dolphinR123" to join the group.

Overall, BOSS Zhipin's Q1 report basically met expectations, and the specific operating indicators mainly revealed two pieces of information:

1. BOSS Zhipin's industry position is still stable

(1) The platform's monthly active users increased by a net of 8.8 million compared to the previous month, reaching 39.7 million. Not only did the absolute value hit a new historical high, but the net increase rate also hit a new high.

Combined with the user data of other recruitment platforms under QM, BOSS Zhipin is undoubtedly the leader in the industry and the largest online recruitment platform in the hearts of job seekers.

(2) The short-term adversity period of competitive advantages is conducive to BOSS optimizing its own profit model. From a long-term perspective, as long as there is a large amount of fresh and active traffic, recruiters will naturally be attracted.

In the first quarter, the operating loss of BOSS Zhipin's core main business compared to the previous month was significantly narrowed. In addition to the increase in traffic driving server bandwidth costs and affecting gross profit margin by about 1-2 percentage points, sales expenses are also relatively high in the whole year as the main customer acquisition period. Since the invalid delivery was relatively small due to the registration ban period in the first quarter of last year, the sales expenses have returned to growth since the fourth quarter of last year, and the expansion intention is obvious. However, this has also affected the speed of repairing the operating profit margin to a certain extent.

2. Environmental pressure is obvious, slow improvement in the short term, not pessimistic in the medium term

(1) The first quarter continues to perform the scene of labor supply and demand being in short supply.

a. Corporate recruitment demand has recovered, but it is far from the demand of job seekers.

The most direct way is to look at the revenue growth rate of two segmented businesses. The online recruitment revenue paid by enterprises increased by 11% year-on-year, and the revenue from other services paid mainly by job seekers increased by 66% year-on-year.

However, the gold owner of the recruitment platform is still the enterprise side. The recruitment revenue on BOSS Zhipin also accounts for 98.6%, so the total revenue growth rate follows the enterprise payment. The company's revenue guidance for the second quarter is 1.43-1.46 billion yuan, an increase of 28% to 31% year-on-year, which is similar to market expectations.

b. The number of paying enterprises is increasing, but the annualized recruitment demand per individual enterprise has decreased.

Looking at the average situation of enterprise payment can reflect some problems more deeply. In the past 12 months, the number of paying enterprises was 4 million, a net increase of 400,000 month-on-month. Considering the benefits of registration unblocking and the natural growth of the spring recruitment season, at first glance, this number of 400,000 may not be a strong recovery.

However, considering that the second, third, and fourth quarters of last year were really bad in the past 12 months, Dolphin Analyst believes that the enterprise payment in the first quarter should actually be better than what it appears.

Moreover, everyone has more or less felt the changes in the macro environment since the beginning of the year, so it is basically priced in.

Over the past 12 months, the average online recruitment revenue per enterprise has reached 4 million yuan. However, in the first quarter, it decreased by 7% compared to the previous quarter. This means that from the perspective of each micro-enterprise, on the one hand, some companies have indeed seen a contraction in job demand, while on the other hand, more small and medium-sized enterprises have entered the market.

(2) However, the mid-term outlook for companies is not bad.

Looking at BOSS Zhipin, there are two key forward-looking indicators: cash receipts and deferred revenue.

In the first quarter, both cash receipts and deferred revenue showed a significant increase compared to the same period last year. The 30% revenue guidance for the second quarter may also benefit from the low base of the same period last year. However, from the perspective of the record high deferred revenue, even if some of the price increases are excluded, companies are by no means lacking in confidence, even from a one-year perspective.

In short, the short-term pressure brought by the environment rather than BOSS Zhipin itself is obvious, but the flexibility of the tool is precisely the platform feature of BOSS Zhipin. Therefore, once the economy accelerates its recovery, the expansion of companies will also be reflected in BOSS's performance as quickly as possible.

The current decline in valuation has almost reached the pessimistic expectations of Dolphin Analyst, but as long as BOSS Zhipin's core competitive advantage is not damaged, Dolphin Analyst believes that it can become more active in the bottom stage of the economic cycle.

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Dolphin Research on BOSS Zhipin:

Financial report season

March 21, 2023 Telephone Conference Call "Platform data hits new highs, revenue has confidence to exceed expectations (BOSS Zhipin 4Q22 Telephone Conference Call Summary)"

March 20, 2023 Financial Report Review "BOSS Zhipin: Recovery is confirmed, but the pace is slow"

November 30, 2022 Financial Report Review "BOSS Zhipin: Short-term impact of the epidemic, turning point comes after the economic trough"2022 年 8 月 25 日电话会《 BOSS 直聘：经营端恢复的同时，继续理智花钱、效率优先（2Q22 电话会纪要）》

2022 年 8 月 24 日财报点评《双压过后，BOSS 直聘重回增长倒计时》

2022 年 6 月 25 日电话会《疫情结束后服务业需求反弹最高，竞争暂未看到威胁（BOSS 直聘电话会）》

2022 年 6 月 25 日财报点评《 BOSS 直聘：抗住了逆风，待 “封印” 解除》

2022 年 3 月 24 日电话会《解封之前继续做存量精细化运营（BOSS 直聘电话会纪要）》

2022 年 3 月 24 日财报点评《 BOSS 直聘：当下广积粮，将来高筑墙》

2021 年 11 月 25 日财报点评《 BOSS 直聘：监管与宏观双压，先赚钱过冬（含电话会纪要重点）》