Beike's third-quarter net revenue reached 22.6 billion yuan, driving quality and efficiency to new heights.

On November 21, the technology-driven one-stop new living service platform $BEKE-W(02423.HK) released its financial results for the third quarter of 2024. Thanks to proactive business expansion strategies and scientific management measures, BEKE demonstrated active and sustainable growth momentum.

During the reporting period, BEKE $KE(BEKE.US) achieved a total transaction volume (GTV) of 736.8 billion yuan (RMB, same below), a year-on-year increase of 12.5%. Net revenue reached 22.6 billion yuan, up 26.8% year-on-year, while net profit amounted to 1.168 billion yuan. Adjusted net profit reached 1.782 billion yuan, exceeding market consensus expectations.

Peng Yongdong, Co-founder, Chairman, and CEO of BEKE, stated: "Against the backdrop of market adjustments, we have achieved solid results across all business lines. We actively expanded our real estate transaction services while steadfastly building a more harmonious ecosystem. Through mechanisms like the 'Store Points System,' we helped store owners gain better returns and receive value feedback from the platform. Our direct-operated business, Lianjia, continued to drive innovation and broker professionalism on the foundation of healthy operations. In home renovation and rental services, we also advanced the construction of foundational capabilities in product, process redesign, and supply chain. At the same time, we are encouraged by the recent positive statements from the central government, such as 'stopping the decline and stabilizing the market,' and a series of coordinated policy supports that have begun to show results. Market recovery is underway. In an improving external environment, we will remain steadfast in our long-term vision, continuously explore innovation, drive organizational growth, and maintain optimism, perseverance, and unity as we move toward a brighter future."

Xu Tao, Executive Director and CFO of BEKE, said: "In the third quarter, we continued to demonstrate sustainable growth momentum. Our real estate transaction services delivered steady revenue performance, and the monetization capability of our new home business further strengthened. We actively advanced our 'One Body, Three Wings' strategy, with the proportion of revenue from home renovation, rental services, and emerging businesses further increasing to 38.3% of net revenue in Q3. At the same time, we continued to reward shareholders who have grown with the company and shared the dividends of development with investors. From the beginning of the year to the end of Q3, we repurchased approximately $580 million worth of shares. Since the launch of the repurchase program in September 2022, we have cumulatively repurchased approximately $1.49 billion by the end of Q3, accounting for about 8.10% of the total shares outstanding before the program began."

Unlocking the Potential of Stores and Agents, Optimizing Platform Ecology and Operational Efficiency

After a pulse-like recovery following the intensive policy rollout in May, the market gradually entered a phase of adjustment in Q3. The secondary housing market remained relatively stable, while the new home market showed signs of further recovery on both supply and demand sides. At the end of September, multiple departments, including the People's Bank of China and the Financial Regulatory Authority, introduced a "policy combo," including measures such as lowering down payment ratios for second homes and reducing existing mortgage rates, sending a strong signal of "stabilizing the real estate market." Data from the Ministry of Housing and Urban-Rural Development showed that in October, the total transaction volume of new and secondary homes nationwide increased by 3.9% year-on-year, marking the first growth after eight consecutive months of decline, significantly boosting market confidence.

In Q3, BEKE's secondary housing business achieved a GTV of 477.8 billion yuan, up 8.8% year-on-year, with net revenue of 6.2 billion yuan. While actively expanding, BEKE's efficient cooperation network, professional empowerment initiatives, and diversified businesses such as new homes and renovation also attracted external stores, leading to a continuous increase in networked stores. During the reporting period, the number of active stores on BEKE's platform reached 46,857, up 14.6% year-on-year, with a net addition of nearly 6,000 stores. The number of active agents reached 423,400, up 6.1% year-on-year.

Since Q3, BEKE has rolled out a series of measures for platform ecology and store operations, sharing value with store owners and fostering mutual growth between stores and the platform.

Specifically, in terms of ecosystem building, BEKE focused on five areas—operational mechanisms, fairness and transparency, service commitments, business support, and honor systems—through regional co-governance councils to enhance store owners' satisfaction with the platform and create a competitive and upward collaborative atmosphere. Mechanically, BEKE implemented the "Store Points System" to reward stores with long tenure, strong performance, adherence to bottom lines, and innovative exploration, helping store owners achieve better returns and long-term development on the platform. In Q3, BEKE distributed rights and interests equivalent to 18 million yuan in cash to store owners in pilot cities.

In terms of refined operations, BEKE adopted more granular strategies, empowering stores at the neighborhood level. For neighborhoods with insufficient store cooperation efficiency, BEKE conducted data analysis, problem diagnosis, and strategy support through platform data, with the participation of store owner co-governance councils, to focus on listings and increase inter-store collaboration.

In the new home segment, BEKE's performance demonstrated strength beyond the market, achieving a GTV of 227.6 billion yuan in Q3, up 18.4% year-on-year, and net revenue of 7.7 billion yuan, up 30.9% year-on-year. BEKE's focused project strategy, incremental value beyond channels, and strong execution and sales capabilities continued to gain market recognition, further broadening cooperation interfaces. Not only did the number of cooperative projects reach a historical high in Q3, but strategic partnerships also continued to break new ground, now covering most of the Top 10 developers.

Additionally, BEKE maintained robust risk control, with the proportion of "fast commission" income—where developers prepay commissions—remaining high. Accounts receivable turnover days stayed at an extremely low level of 47 days. Stable collections further enhanced agents' job security and stimulated stronger service willingness.

Strengthening the Foundation of Quality, Continuously Investing in Infrastructure and Core Capabilities

Guided by the "One Body, Three Wings" development strategy, BEKE targeted the vast growth space in living services, continued to advance in home renovation, rental, and other business scenarios, and built new engines for long-term sustainable development, gradually moving toward a "one-stop new living service platform" to provide consumers with more "better living" options. In Q3, BEKE's non-real estate transaction services revenue grew 54.3% year-on-year, accounting for 38.3% of total revenue, up 6.8 percentage points from the same period last year.

Thanks to refined operations management, product package updates, and increased centralized procurement, BEKE's home renovation business achieved a contract value of 4.1 billion yuan in Q3, up 24.6% year-on-year, with net revenue of 4.2 billion yuan, up 32.6% year-on-year. The contribution margin reached 31.2%, showing improvement compared to the same period last year.

In the virtuous cycle of "quality, efficiency, and scale" for the home renovation business, "quality" is the core. BEKE continuously improved workflows and models around quality. To address the complexity of home renovation processes, BEKE comprehensively reviewed key points in construction this year, optimizing construction plans and internal control processes in a timely manner.

In terms of delivery capability and quality improvement, by further refining construction processes and dispatching efficiency, BEKE reduced the combined duration of basic construction and main materials to approximately 99.5 days in Q3, compared to about 109.3 days in the same period last year. Additionally, while promoting proactive maintenance services, BEKE also built in-house repair and maintenance teams nationwide, expanding from over 200 people at the end of last year to over 500 by the end of September this year, enhancing post-delivery experiences.

In the rental business, BEKE achieved net revenue of 3.9 billion yuan in Q3, up 118.4% year-on-year. By the end of Q3, the managed scale of "Worry-Free Rentals" exceeded 360,000 units, compared to over 160,000 units in the same period last year. In post-rental services, BEKE provided a series of services such as pre-move-in inspections, standardized handovers, and tenant-side property transfers, while centralizing and empowering the role of property managers to enhance service standardization and strengthen rental service capabilities and quality. In internal operational efficiency, key operational metrics for "Worry-Free Rentals" showed significant year-on-year improvement, benefiting from refined management of secondary rentals, increased tenant renewal rates and property pre-leasing rates, and reduced vacancy costs. The business also continued to optimize and upgrade product models, strengthen stable sales channels, and reduce the impact of market fluctuations, improving rental certainty.

In September, BEKE's "Beihaojia" business also made significant progress, successfully acquiring a prime plot in Chengdu's core area, which is planned to be BEKE's first self-operated project. From land acquisition to positioning, design, and marketing, the project will fully reflect Beihaojia's C2M (Consumer-to-Manufacturer) concept. Notably, Beihaojia is clearly positioned as a data-driven residential development service platform, not a real estate developer, aiming to validate the implementation capability of C2M product solutions through this Chengdu project and enhance partners' trust.

Moving forward, BEKE will continue to adhere to a long-term perspective, seeking internal evolution of platform capabilities and ecosystem while externally linking with more positive forces in the industry. Together, we will address the important topic of "better living" and strive tirelessly to build a virtuous cycle for the development of the living services industry.