UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

 

FORM 6-K

 

 

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER

THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of September 2023

 

Commission File Number: 001-39591

 

 

 

iHuman Inc.

(Registrant’s Name)

 

 

 

Floor 8, Building B,
No. 1 Wangjing East Road,
Chaoyang District, Beijing 100102

People’s Republic of China

(Address of Principal Executive Offices)

 

 

 

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

 

Form 20-F  x     Form 40-F ¨

 

 

 

 

 

EXHIBIT INDEX

 

Exhibit No.   Description
99.1   Press Release

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  iHuman Inc.
       
  By   :

/s/ Vivien Weiwei Wang

  Name : Vivien Weiwei Wang
  Title : Director and Chief Financial Officer

 

Date: September 21, 2023

 

 

 

Exhibit 99.1

 

 

iHuman Inc. Announces Second Quarter 2023 Unaudited Financial Results

 

BEIJING, China, September 21, 2023 -- iHuman Inc. (NYSE: IH) (“iHuman” or the “Company”), a leading provider of tech-powered, intellectual development products in China, today announced its unaudited financial results for the second quarter ended June 30, 2023.

 

Second Quarter 2023 Highlights

 

·Revenues were RMB241.0 million (US$33.2 million), compared with RMB230.6 million in the same period last year.

·Gross profit was RMB170.8 million (US$23.6 million), compared with RMB163.2 million in the same period last year.

·Operating income was RMB40.9 million (US$5.6 million), a year-over-year increase of 80.8%.

·Adjusted operating income1 was RMB43.3 million (US$6.0 million), a year-over-year increase of 75.7%.

·Net income was RMB42.1 million (US$5.8 million), a year-over-year increase of 93.1%.

·Adjusted net income1 was RMB44.5 million (US$6.1 million), a year-over-year increase of 86.8%.

·Average total MAUs2 for the second quarter were 20.33 million, a year-over-year increase of 11.7%.

 

Dr. Peng Dai, Director and Chief Executive Officer of iHuman, commented, “Despite the impact of seasonality on our business, we are pleased to deliver another quarter of solid results, marked by year-over-year revenue improvement and enhanced profitability. This performance underscores the resilience of our business model and the effective execution by our team to further solidify our industry-leading position. During the quarter, we remained committed to our product-driven strategy and to strengthening our portfolio through a combination of cutting-edge technological innovation and captivating content. Domestically, we further optimized our comprehensive portfolio, rolling out enhancements to both newer releases and well-established core offerings. For example, within iHuman Little Artists, we launched “Interactive Art Gallery”, an innovative module designed to introduce children to art and nurture their creativity through an integrated online-offline experience. Leveraging advanced technologies such as key point recognition, image segmentation and an AI-driven assessment engine, the module provides children with extensive support throughout their creative journey, including step-by-step instructions, instant and personalized feedback, and guidance from seasoned art professionals. Within our long-standing flagship app, iHuman Chinese, which is the prominent market leader in the category, we introduced a new module named “Chinese Characters in Daily Life.” By integrating Chinese characters into everyday life scenarios and weaving them into intriguing short stories that resonate with children, the module strengthens children’s familiarity and proficiency with Chinese characters in a fun way. Internationally, we continued to boost our market presence by diligently enriching our product offerings with enlightening content and innovative features. In particular, we expanded Aha World with two more highly engaging modules, “My World” and “City.” Designed to further unleash children’s creativity, these modules offer children a wide array of elements with which they can use their imagination to custom-design scenes from daily life in the virtual world. The open-ended creative experience offered by these modules received an enthusiastic reception from our young audience. Looking ahead, we will continue to focus on technological innovation and content excellence to secure the long-term success of our products and sustainable growth of our business.”

 

Ms. Vivien Weiwei Wang, Director and Chief Financial Officer of iHuman, added, “We reported another solid set of results which reflects our commitment and continued focus on driving sustainable growth and profitability. Our revenues continued to grow year-over-year and our net income nearly doubled, marking our sixth consecutive quarter of profitability. Our strong and balanced financial position enables us to continue investing in innovation and cutting-edge technologies to support the sustainable growth of our business. The solid foundation created by our user base is an integral driver for our long-term growth. During the quarter, our average total MAUs increased by 11.7% year-over-year to 20.33 million. We are encouraged by the strength and resilience of our diversified business and our ability to execute on our strategy to drive business growth. As we move into the second half of the year, we will continue to drive business growth and create value for our shareholders by further enhancing our operational efficiency and strategically investing in long-term growth opportunities, fortifying our industry-leading position.”

 

 

1 “Adjusted operating income” and “adjusted net income” exclude share-based compensation expenses. Please see “Non-GAAP Financial Measures” and “Unaudited Reconciliation of GAAP and non-GAAP Results” at the end of this press release.

2 “Average total MAUs” refers to the monthly average of the sum of the MAUs of each of the Company’s apps during a specific period, which is counted based on the number of unique mobile devices through which such app is accessed at least once in a given month, and duplicate access to different apps is not eliminated from the total MAUs calculation.

 

1

 

Second Quarter 2023 Unaudited Financial Results

 

Revenues

 

Revenues were RMB241.0 million (US$33.2 million), an increase of 4.5% from RMB230.6 million in the same period last year, primarily driven by user expansion and enhanced user engagement.

 

Average total MAUs for the quarter were 20.33 million, an increase of 11.7% year-over-year from 18.20 million in the same period last year. The number of paying users3 was 1.31 million.

 

Cost of Revenues

 

Cost of revenues was RMB70.2 million (US$9.7 million), an increase of 4.1% from RMB67.4 million in the same period last year.

 

Gross Profit and Gross Margin

 

Gross profit was RMB170.8 million (US$23.6 million), an increase of 4.7% from RMB163.2 million in the same period last year. Gross margin was 70.9%, maintaining approximately the same level from 70.8% in the same period last year.

 

Operating Expenses

 

Total operating expenses were RMB130.0 million (US$17.9 million), a decrease of 7.6% from RMB140.6 million in the same period last year.

 

Research and development expenses were RMB63.4 million (US$8.7 million), a decrease of 18.9% from RMB78.2 million in the same period last year, primarily due to payroll-related cost savings and decreased outsourcing expenses as a result of the continued optimization of our operational efficiency.

 

Sales and marketing expenses were RMB40.6 million (US$5.6 million), an increase of 21.0% from RMB33.5 million in the same period last year, primarily due to increased strategic spending on promotional activities.

 

General and administrative expenses were RMB26.0 million (US$3.6 million), compared with RMB28.8 million in the same period last year.

 

Operating Income

 

Operating income was RMB40.9 million (US$5.6 million), an increase of 80.8% from RMB22.6 million in the same period last year.

 

Excluding share-based compensation expenses, adjusted operating income was RMB43.3 million (US$6.0 million), an increase of 75.7% from RMB24.6 million in the same period last year.

 

Net Income

 

Net income was RMB42.1 million (US$5.8 million), an increase of 93.1% from RMB21.8 million in the same period last year.

 

 

3 “Paying users” refers to users who paid subscription fees for premium content on any of the Company’s apps during a specific period; a user who makes payments across different apps using the same registered account is counted as one paying user, and a user who makes payments for the same app multiple times in the same period is counted as one paying user.

 

2

 

Adjusted net income was RMB44.5 million (US$6.1 million), an increase of 86.8% from RMB23.8 million in the same period last year.

 

Basic and diluted net income per ADS were RMB0.80 (US$0.11) and RMB0.77 (US$0.11), respectively, compared with RMB0.41 and RMB0.40 in the same period last year. Each ADS represents five Class A ordinary shares of the Company.

 

Adjusted diluted net income per ADS was RMB0.81 (US$0.11), compared with RMB0.44 in the same period last year.

 

Deferred Revenue and Customer Advances

 

Deferred revenue and customer advances were RMB325.8 million (US$44.9 million) as of June 30, 2023, compared with RMB379.1 million as of December 31, 2022.

 

Cash, Cash Equivalents and Time Deposits

 

Cash, cash equivalents and time deposits were RMB1,104.8 million (US$152.4 million) as of June 30, 2023, compared with RMB1,050.0 million as of December 31, 2022.

 

Exchange Rate Information

 

The U.S. dollar (US$) amounts disclosed in this press release, except for those transaction amounts that were actually settled in U.S. dollars, are presented solely for the convenience of the reader. The conversion of Renminbi (RMB) into US$ in this press release is based on the exchange rate set forth in the H.10 statistical release of the Board of Governors of the Federal Reserve System as of June 30, 2023, which was RMB7.2513 to US$1.00. The percentages stated in this press release are calculated based on the RMB amounts.

 

Non-GAAP Financial Measures

 

iHuman considers and uses non-GAAP financial measures, such as adjusted operating income, adjusted net income and adjusted diluted net income per ADS, as supplemental metrics in reviewing and assessing its operating performance and formulating its business plan. The presentation of non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). iHuman defines adjusted operating income, adjusted net income and adjusted diluted net income per ADS as operating income, net income and diluted net income per ADS excluding share-based compensation expenses, respectively. Adjusted operating income, adjusted net income and adjusted diluted net income per ADS enable iHuman’s management to assess its operating results without considering the impact of share-based compensation expenses, which are non-cash charges. iHuman believes that these non-GAAP financial measures provide useful information to investors in understanding and evaluating the Company’s current operating performance and prospects in the same manner as management does, if they so choose.

 

Non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. Non-GAAP financial measures have limitations as analytical tools, which possibly do not reflect all items of expense that affect our operations. Share-based compensation expenses have been and may continue to be incurred in our business and are not reflected in the presentation of the non-GAAP financial measures. In addition, the non-GAAP financial measures iHuman uses may differ from the non-GAAP measures used by other companies, including peer companies, and therefore their comparability may be limited. The presentation of these non-GAAP financial measures is not intended to be considered in isolation from or as a substitute for the financial information prepared and presented in accordance with GAAP.

 

Safe Harbor Statement

 

This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and similar statements. Statements that are not historical facts, including statements about iHuman’s beliefs and expectations, are forward-looking statements. Among other things, the description of the management’s quotations in this announcement contains forward-looking statements. iHuman may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the “SEC”), in its annual report to shareholders, in press releases and other written materials, and in oral statements made by its officers, directors or employees to third parties. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: iHuman’s growth strategies; its future business development, financial condition and results of operations; its ability to continue to attract and retain users, convert non-paying users into paying users and increase the spending of paying users, the trends in, and size of, the market in which iHuman operates; its expectations regarding demand for, and market acceptance of, its products and services; its expectations regarding its relationships with business partners; general economic and business conditions; regulatory environment; and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in iHuman’s filings with the SEC. All information provided in this press release is as of the date of this press release, and iHuman does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

 

3

 

About iHuman Inc.

 

iHuman Inc. is a leading provider of tech-powered, intellectual development products in China that is committed to making the child-upbringing experience easier for parents and transforming cognitive development into a fun journey for children. Benefiting from a deep legacy that combines over two decades of experience in the parenthood industry, superior original content, advanced high-tech innovation DNA and research & development capabilities with cutting-edge technologies, iHuman empowers parents with tools to make the child-upbringing experience more efficient. iHuman’s unique, fun and interactive product offerings stimulate children’s natural curiosity and exploration. The Company’s comprehensive suite of innovative and high-quality products include self-directed apps, interactive content and smart devices that cover a broad variety of areas to develop children’s abilities in speaking, critical thinking, independent reading and creativity, and foster their natural interest in traditional Chinese culture. Leveraging advanced technological capabilities, including 3D engines, AI/AR functionality, and big data analysis on children’s behavior & psychology, iHuman believes it will continue to provide superior experience that is efficient and relieving for parents, and effective and fun for children, in China and all over the world, through its integrated suite of tech-powered, intellectual development products.

 

For more information about iHuman, please visit https://ir.ihuman.com/.

 

For investor and media enquiries, please contact:

 

iHuman Inc.

Mr. Justin Zhang

Investor Relations Director

Phone: +86 10 5780-6606

E-mail: ir@ihuman.com

 

Christensen

In China

Mr. Eric Yuan

Phone: +86-13801110739

E-mail: eric.yuan@christensencomms.com

 

In the US

Ms. Linda Bergkamp

Phone: +1-480-614-3004

E-mail: linda.bergkamp@christensencomms.com

 

4

 

iHuman Inc.

 

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

 

(Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“US$”)

except for number of shares, ADSs, per share and per ADS data)

 

   December 31,   June 30,   June 30, 
   2022   2023   2023 
   RMB   RMB   US$ 
ASSETS               
Current assets               
Cash and cash equivalents   1,049,999    967,472    133,420 
Time deposits   -    137,290    18,933 
Accounts receivable, net   79,614    58,982    8,134 
Inventories, net   19,127    15,144    2,088 
Amounts due from related parties   2,286    1,780    245 
Prepayments and other current assets   102,765    92,630    12,774 
Total current assets   1,253,791    1,273,298    175,594 
Non-current assets               
Property and equipment, net   9,205    7,284    1,005 
Intangible assets, net   24,872    24,707    3,407 
Operating lease right-of-use assets   12,782    3,626    500 
Long-term investment   26,333    26,333    3,631 
Other non-current assets   6,416    6,659    922 
Total non-current assets   79,608    68,609    9,465 
Total assets   1,333,399    1,341,907    185,059 
                
LIABILITIES               
Current liabilities               
Accounts payable   24,206    20,198    2,785 
Deferred revenue and customer advances   379,063    325,828    44,934 
Amounts due to related parties   6,944    3,529    487 
Accrued expenses and other current liabilities   144,717    110,440    15,230 
Current operating lease liabilities   6,123    1,566    216 
Total current liabilities   561,053    461,561    63,652 
Non-current liabilities               
Non-current operating lease liabilities   2,894    2,267    313 
Total non-current liabilities   2,894    2,267    313 
Total liabilities   563,947    463,828    63,965 
SHAREHOLDERS’ EQUITY               
Ordinary shares (par value of US$0.0001 per share, 700,000,000 Class A shares authorized as of December 31, 2022 and June 30, 2023; 125,122,382 Class A shares issued and 121,722,467 outstanding as of December 31, 2022; 125,122,382 Class A shares issued and 119,857,402 outstanding as of June 30, 2023; 200,000,000 Class B shares authorized, 144,000,000 Class B ordinary shares issued and outstanding as of December 31, 2022 and June 30, 2023; 100,000,000 shares (undesignated) authorized, nil shares (undesignated) issued and outstanding as of December 31, 2022 and June 30, 2023)   185    185    26 
Additional paid-in capital   1,079,099    1,083,937    149,482 
Treasury stock   (7,123)   (15,592)   (2,150)
Statutory reserves   7,967    7,967    1,099 
Accumulated other comprehensive income   10,497    27,035    3,728 
Accumulated deficit   (321,173)   (225,453)   (31,091)
Total shareholders’ equity   769,452    878,079    121,094 
Total liabilities and shareholders’ equity   1,333,399    1,341,907    185,059 

 

5

 

iHuman Inc.

 

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

 

(Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“US$”)

except for number of shares, ADSs, per share and per ADS data)

 

   For the three months ended   For the six months ended 
   June 30,   March 31,   June 30,   June 30,   June 30,   June 30,   June 30, 
   2022   2023   2023   2023   2022   2023   2023 
   RMB   RMB   RMB   US$   RMB   RMB   US$ 
Revenues  230,607   265,203   240,993   33,234   473,286   506,196   69,808 
Cost of revenues  (67,417)  (79,636)  (70,160)  (9,676)  (140,214)  (149,796)  (20,658)
                             
Gross profit  163,190   185,567   170,833   23,558   333,072   356,400   49,150 
                             
Operating expenses                            
Research and development expenses  (78,201)  (61,673)  (63,412)  (8,745)  (174,826)  (125,085)  (17,250)
Sales and marketing expenses  (33,530)  (40,435)  (40,564)  (5,594)  (69,436)  (80,999)  (11,170)
General and administrative expenses  (28,849)  (26,735)  (25,982)  (3,583)  (54,907)  (52,717)  (7,270)
Total operating expenses  (140,580)  (128,843)  (129,958)  (17,922)  (299,169)  (258,801)  (35,690)
Operating income  22,610   56,724   40,875   5,636   33,903   97,599   13,460 
Other income, net  2,917   6,082   8,132   1,121   6,264   14,214   1,960 
Income before income taxes  25,527   62,806   49,007   6,757   40,167   111,813   15,420 
Income tax expenses  (3,737)  (9,160)  (6,933)  (956)  (5,259)  (16,093)  (2,219)
Net income  21,790   53,646   42,074   5,801   34,908   95,720   13,201 
                             
Net income per ADS:                            
- Basic  0.41   1.01   0.80   0.11   0.66   1.81   0.25 
- Diluted  0.40   0.98   0.77   0.11   0.64   1.75   0.24 
                             
Weighted average number of ADSs:                            
- Basic  53,308,924   52,953,297   52,804,594   52,804,594   53,392,158   52,878,535   52,878,535 
- Diluted  53,958,284   54,763,570   54,725,528   54,725,528   54,009,098   54,744,139   54,744,139 
                             
Total share-based compensation expenses included in:                            
Cost of revenues  39   98   70   10   103   168   23 
Research and development expenses  801   638   1,142   157   1,768   1,780   245 
Sales and marketing expenses  430   379   59   8   342   438   60 
General and administrative expenses  762   1,292   1,160   160   1,776   2,452   338 

 

6

 

iHuman Inc.

 

UNAUDITED RECONCILIATION OF GAAP AND NON-GAAP RESULTS

 

(Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“US$”)

except for number of shares, ADSs, per share and per ADS data)

 

   For the three months ended   For the six months ended 
   June 30,   March 31,   June 30,   June 30,   June 30,   June 30,   June 30, 
   2022   2023   2023   2023   2022   2023   2023 
   RMB   RMB   RMB   US$   RMB   RMB   US$ 
Operating income  22,610   56,724   40,875   5,636   33,903   97,599   13,460 
Share-based compensation expenses  2,032   2,407   2,431   335   3,989   4,838   666 
Adjusted operating income  24,642   59,131   43,306   5,971   37,892   102,437   14,126 
                             
Net income  21,790   53,646   42,074   5,801   34,908   95,720   13,201 
Share-based compensation expenses  2,032   2,407   2,431   335   3,989   4,838   666 
Adjusted net income  23,822   56,053   44,505   6,136   38,897   100,558   13,867 
                             
Diluted net income per ADS  0.40   0.98   0.77   0.11   0.64   1.75   0.24 
Impact of non-GAAP adjustments  0.04   0.04   0.04   0.00   0.08   0.09   0.01 
Adjusted diluted net income per ADS  0.44   1.02   0.81   0.11   0.72   1.84   0.25 
                             
Weighted average number of ADSs – diluted  53,958,284   54,763,570   54,725,528   54,725,528   54,009,098   54,744,139   54,744,139 
Weighted average number of ADSs – adjusted  53,958,284   54,763,570   54,725,528   54,725,528   54,009,098   54,744,139   54,744,139 

 

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