RLX Technology (NYSE:RLX) Announces Earnings Results

RLX Technology (NYSE:RLX) issued its quarterly earnings results on Friday. The company reported $0.03 EPS for the quarter, missing analysts’ consensus estimates of $0.09 by ($0.06), FiscalAI reports. RLX Technology had a return on equity of 6.15% and a net margin of 20.76%.The company had revenue of $148.73 million during the quarter, compared to the consensus estimate of $173.99 million.

Here are the key takeaways from RLX Technology’s conference call:

• Q2 revenue rose 14.8% year over year to RMB 1.01 billion, while gross profit increased 47.8% to RMB 357.8 million. Gross margin expanded to 35.4%, supported by supply-chain optimization, manufacturing yields, and favorable product mix.
• International markets accounted for approximately 70% of revenue and remained the primary growth engine. The Western European distribution acquisition will be fully consolidated beginning in Q3, providing access to more than 30,000 retail endpoints and over 20,000 independent merchants through its B2B platform.
• Sequential revenue moderated as trade inventories normalized after Q1 shipments were pulled forward by regulatory export adjustments. Management also expects gross margin to settle into a more balanced range, while the lower-margin distribution business will dilute percentage margins despite increasing absolute operating profit and net income.
• RLX reported RMB 13.9 billion in cash and liquid resources and plans to prioritize high-return organic investments, selective accretive M&A, share repurchases, and dividends, subject to board approval. Management emphasized that acquisitions must be strategically synergistic, cash-payback oriented, non-dilutive, and EPS-accretive.
• The company is limiting near-term U.S. investment until PMTA enforcement becomes more predictable, while forecasting Mainland China sales to be broadly flat for the full year amid stricter regulatory approvals. Growth priorities are shifting toward Europe, Asia, and modern oral nicotine pouches, supported by a planned Southeast Asian multi-category manufacturing hub.

RLX Technology Trading Down 2.2%

Shares of NYSE:RLX traded down $0.04 during trading on Friday, reaching $1.96. 8,778,373 shares of the company traded hands, compared to its average volume of 2,433,980. RLX Technology has a 52-week low of $1.76 and a 52-week high of $2.84. The firm has a market capitalization of $3.03 billion, a price-to-earnings ratio of 19.55 and a beta of 1.20. The business’s fifty day moving average is $1.96 and its 200-day moving average is $2.13.

Institutional Investors Weigh In On RLX Technology

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in the company. Mackenzie Financial Corp boosted its position in RLX Technology by 40.4% during the 4th quarter. Mackenzie Financial Corp now owns 4,218,617 shares of the company’s stock valued at $9,642,000 after buying an additional 1,214,766 shares during the period. Canada Pension Plan Investment Board increased its position in shares of RLX Technology by 53.7% in the second quarter. Canada Pension Plan Investment Board now owns 3,804,284 shares of the company’s stock valued at $8,407,000 after acquiring an additional 1,329,500 shares during the period. State Street Corp raised its stake in shares of RLX Technology by 4.5% during the fourth quarter. State Street Corp now owns 3,275,082 shares of the company’s stock valued at $7,630,000 after acquiring an additional 141,621 shares during the last quarter. Marshall Wace LLP raised its stake in shares of RLX Technology by 82.4% during the third quarter. Marshall Wace LLP now owns 2,067,228 shares of the company’s stock valued at $5,437,000 after acquiring an additional 934,135 shares during the last quarter. Finally, Mariner LLC raised its stake in shares of RLX Technology by 7,564.1% during the third quarter. Mariner LLC now owns 1,668,476 shares of the company’s stock valued at $4,388,000 after acquiring an additional 1,646,706 shares during the last quarter. 22.68% of the stock is currently owned by institutional investors.

Analyst Ratings Changes

Separately, Weiss Ratings reaffirmed a “hold (c)” rating on shares of RLX Technology in a research note on Friday, July 17th. Two investment analysts have rated the stock with a Hold rating, According to MarketBeat.com, the stock has an average rating of “Hold” and an average price target of $2.50.

About RLX Technology

RLX Technology Inc (NYSE:RLX) is a China-based company specializing in electronic nicotine delivery systems. The company develops, manufactures and markets closed-pod vaping devices and prefilled cartridges, positioning its products as an alternative to traditional combustible tobacco. RLX emphasizes consistent nicotine delivery, flavor variety and convenience through its proprietary e-liquid formulations and device design.

RLX operates a vertically integrated business model that encompasses research and development, production, quality control and sales.