Kanzhun’s Stock Surges Over 10% Following Strong Earnings Report
The job recruitment app is poised for major opportunities while facing significant challenges, as more individuals seek employment and companies appear ready to increase hiring.
Overview of Kanzhun Ltd.
Kanzhun Ltd., known for its flagship recruitment platform Boss Zhipin, has recently reported impressive financial results. The company’s net profit surged by 42.6% in the past year, reaching 1.57 billion yuan. Additionally, its revenue grew by 23.6%, totaling 7.36 billion yuan (approximately $1.02 billion). By the end of the year, Kanzhun held 14.7 billion yuan in cash and short-term investments, a significant increase from the previous year.
User Growth and Market Presence
As of 2024, Boss Zhipin boasted around 53 million monthly active users, a 25.3% increase from the previous year. Although there was a slight dip from a peak of 58 million in the third quarter, Kanzhun’s user base is still substantial; it surpasses the combined totals of its main competitors: Zhaopin, 51job, and Tongdao Liepin, according to Questmobile.
Revenue Streams and Business Strategy
Enterprise Customer Expansion
Kanzhun is steadily growing its paying enterprise customers, which increased by 17.3% to 6.1 million. This growth is essential for the company’s revenue, particularly from online recruitment services, which saw sales jump from 5.89 billion yuan to 7.27 billion yuan. Although revenue from value-added services for job seekers was lower, it still grew by 36.2% to 85.7 million yuan.
Cost Management
The company effectively manages expenses, with marketing costs rising only moderately by 4.1% to 2.07 billion yuan. This uptick mostly stems from increased employment costs, but was mitigated by a drop in advertising spending. As of last year, Kanzhun employed 5,688 people, reflecting a 6% increase in staff, primarily in marketing and sales roles.
Innovative Technology Deployment
Integration of AI Solutions
Kanzhun has integrated its DeepSeek technology into the Boss Zhipin platform and is undergoing gray-box testing for enhanced features. The company uses its proprietary Nanbeige AI model to offer services, allowing for smarter candidate selection and improved matching between job seekers and employers. The AI functionality can recommend suitable candidates and provide rationale behind these recommendations, enhancing the experience for both job seekers and recruiters.
Job seekers benefit from a user-friendly interface that allows them to communicate their needs naturally, access job information, and participate in practice interviews. This technological advancement aims to streamline the job application process and foster better interactions between applicants and potential employers.
Market Outlook
Expert Analysis
Recent reports from UBS indicate renewed optimism in the recruitment market, prompting the firm to raise its revenue outlook for Kanzhun. They anticipate year-over-year growth of around 12.2% and 12.1% for the first quarter and full year, respectively. As investor sentiment improves, Kanzhun’s stock price target was adjusted upwards from $17 to $19.50.
Economic Context and Job Market Forecast
The job market remains a critical issue for China, especially with the influx of approximately 12.22 million college graduates expected to enter the workforce this summer. The ability of the job market to absorb these newcomers presents both challenges and opportunities for recruiters. Kanzhun’s position as a leader in the human resources sector is supported by the increasing number of job seekers and the company’s commitment to enhancing service delivery through advanced technology.
Overall, Kanzhun continues to adapt and innovate within a dynamic labor market, navigating both industry challenges and growth opportunities with a forward-looking approach.
