Communication Author: Contributor, 施放, Fuller Wang May 25, 2022 03:00 PM (GMT+8)

Zhihu Q1 2022 Financial Report showed a huge increase in the company's growth, with a 55.4% YoY increase in revenue. The content commercialization solution business became the biggest source of revenue.


On May 25, 2022, Zhihu (NYSE: ZH) announced its unaudited financial report for Q1 2022. Zhihu is the largest question-and-answer online community. Zhihu claimed total revenue of CNY 743.2 million, up 55.4% year-over-year compared with CNY 480 million in Q1 2021. Zhihu’s net loss was CNY 614.3 million, up 89.2% compared with CNY 324.7 million in Q1 2021. The adjusted net loss was CNY 367.4 million, compared with CNY 193.6 million in Q1 2021. The gross profit was CNY 335.5 million. The gross profit margin was 45.1%. There was a decrease of 11.9% in profit margin in Q1 2022 compared with the data of Q1 2021.

In terms of operating costs in Q1 2022, Zhihu increased this category from CNY 205.6 million to CNY 407.7 million. Zhihu concluded the reasons were increased advertising, content production, and labor costs. The expenses in research and development were CNY 166.5, up 56.6% compared with CNY 106.3 million in Q1 2021. The expenses in sales and marketing were CNY 506.6 million, up 46.2% year-over-year. Due to COVID-19, inflation in China could also be a reason of increased operating costs. 

As mentioned previously, Zhihu's revenue was up 55.4% year-over-year. In detail, the content commercialization solution business was the largest type of revenue, and counted for 30.5% with CNY 227 million of revenue in this quarter. It was up 87.7% year-over-year. The revenue of paid membership business reached 222 million yuan, accounting for 29.8%. It was up 75.1% year-over-year. The number of paid members reached 6.89 million, up 72.8% year-over-year. The payment rate was 6.8%. Online advertising revenue was 217 million yuan, accounting for 29.2%, up 1.7% year-over-year.

There have been rumors of Zhihu’s layoff action in the past several days. Zhihu reacted to this rumor that there were no-layoff actions, but normal personal changes based on the company’s plans.  

After the release of Q1 2022’s financial report, even though the three major U.S. stock indexes collectively opened lower, Zhihu surprisingly rose more than 8%. Zhihu also plans to repurchase up to USD 100 million in shares in the next 12 months. Zhihu will work forward toward the development of the community ecosystem.