What happened
Shares of the Chinese online content company Zhihu (ZH 1.54%) fell more than 8% today after the company reported earnings results for the second quarter of the year earlier in the day.
So what
Zhihu reported a net loss of $0.12 per American depositary share on total revenue of close to $125 million, with both numbers beating analyst estimates.
Also in the quarter, Zhihu grew its average monthly active users to 105.9 million, up about 12% year over year. Average monthly paying members grew to 8.5 million in Q2, up more than 78% year over year.
"The recent COVID-19 pandemic situation and macroeconomic condition created challenging environment in the second quarter. Against this backdrop, we focused on retaining high quality user growth in a sustainable and efficient manner," Zhihu's CEO, Yuan Zhou, said in an earnings statement.
On the company's quarterly earnings call, he said that "there is no clear sign of recovery just yet" when looking at the company's performance in July and August stacked up against June. He also said that other areas of the question-and-answer website's operations -- such as cosmetics, self-care, food, and beverage -- have not recovered yet and are still struggling due to supply chain shortages.
Now what
The company did beat on earnings, but the outlook was not really positive from management. Additionally, Zhihu only grew monthly active users by about 12% in a year, which could certainly be better. I'm staying on the sidelines.
