Zhibao Technology Inc (ZBAO) Q2 2024 Earnings Report

Zhibao Technology’s QQ2 2024 quarter delivered a pronounced year-over-year expansion in profitability, underscored by double-digit revenue growth and expanding margins, as the company leverages its digital insurance broker platform in China. Revenue rose to 13.78 million USD, up 18.4% YoY, while gross profit climbed 43.0% YoY to 5.82 million USD and gross margin held solid at approximately 42.3%. Operating income reached 2.56 million USD, up 321.3% YoY, and net income was 3.02 million USD with an EPS of 0.0958. This marks a meaningful improvement in operating leverage and earnings quality, supported by a strong contribution from core brokerage services and related underwriting activities.

However, the quarter also reflected a cash flow deterioration, with cash provided by operating activities negative at -12.36 million USD and free cash flow negative at -12.39 million USD, driven by substantial non-cash adjustments and working capital dynamics (notably other non-cash items totaling -15.75 million USD). The balance sheet shows substantial intangible and current asset bases with elevated accounts receivable, contributing to a cash conversion challenge despite a current ratio of 1.40 and positive working capital. Management commentary (where available) was not included in the provided dataset, so the analysis below incorporates all disclosed metrics and the broader market context to form a balanced investment view.