$KE Holdings Inc.(BEKE)$ is scheduled to report its unaudited financial results for the first quarter of 2025 before the U.S. market opens on Thursday, 15 May 2025. The company's management will 1 also hold an earnings conference call at 8:00 A.M. U.S. Eastern Time on the same day (8:00 P.M. Beijing Time).
Revenue: Consensus forecasts for revenue in Chinese Yuan (CNY) range approximately from CNY 18.4 billion to CNY 21.3 billion. One set of estimates based on 3 analysts projects revenue around CNY 20.76 billion to CNY 21.31 billion, with the latter figure suggesting a potential year-over-year growth of around 30%. In U.S. dollar terms, one source indicates a sales forecast for the "next quarter" (presumably Q1 2025) at around USD 3.13 billion (with a range of USD 3.07 billion to USD 3.18 billion).
Earnings Per Share (EPS): In CNY, consensus EPS forecasts include figures like CNY 0.935 and CNY 0.15. In USD, an estimate for the "next quarter" points to a consensus of USD 0.14 (ranging from USD 0.12 to USD 0.16). Another source mentioned a USD 0.20 EPS, indicating significant YoY growth.
Recent News & Analyst Sentiment
Recent company announcements include the release of its 2024 Environmental, Social, and Governance (ESG) Report, the filing of its Annual Report on Form 20-F, and a scheduled Annual General Meeting for 13 June 2025.
Some market commentary in late April 2025 suggested there "May Be Some Bright Spots In KE Holdings' (NYSE:BEKE) Earnings."
Investor sentiment reportedly saw an improvement around late April, reflected in a stock price increase.
Analysts generally forecast positive long-term earnings and revenue growth for the company.
KE Holdings (BEKE) Last Positive Earnings Call Saw Share Price Declined By 21.70%
KE Holdings had a positive earnings call on 18 March 2025 which saw share price declined by 21.70% since.
The earnings call highlighted significant growth in revenue and expansion across various business segments, particularly in home renovation and rental services. However, there were challenges with new home GTV, Q4 profit decline, and the emerging services sector. The integration of AI and substantial shareholder returns contributed positively to the sentiment.
KE Holdings (BEKE) Guidance
During the KE Holdings Inc.'s fourth quarter and fiscal year 2024 earnings call, the company provided extensive guidance on its financial performance and strategic initiatives. The company reported a total revenue of RMB93.5 billion, reflecting a year-over-year growth of over 20%. The gross transaction value (GTV) for existing home transactions reached RMB2.25 trillion, marking an 11% increase from the previous year, while new home transactions generated RMB970 billion in GTV, slightly down by 3.3% year-over-year. The number of active stores rose by 18.3% to nearly 49,700, and the agent count increased by 12.1% to 445,000. The home renovation and furnishing business achieved a 36% revenue increase to RMB14.8 billion, and the home rental services saw a 135% surge in revenue to RMB14.3 billion. The company emphasized its commitment to integrating AI into operations to enhance service quality and operational efficiency, with notable advancements in AI-driven tools and models such as ChatHome and Dreamhome. Additionally, KE Holdings announced a final cash dividend of US$0.12 per ordinary share, demonstrating its dedication to delivering shareholder value. Looking ahead, the company aims to leverage technology and human-centric strategies to drive sustainable growth and efficiency improvements across its business segments.
In terms of the split between the stock market and the new housing market, the average annual GMV of the new housing market under neutral circumstances is 15.10 trillion yuan. The average annual GMV of the second-hand housing market is 9.10 trillion yuan, and it is expected to approach 14 trillion yuan by 2035, accounting for 47% of the total GMV.
Key Factors & Market Context for KE Holdings (BEKE) Q1 2025
Total revenue reached a record high of RMB93.5 billion, growing over 20% year-over-year. Existing home transactions GTV rose nearly 11% year-over-year to RMB2.25 trillion.
Repurchased around US$716 million worth of shares, accounting for around 3.9% of the Company’s total shares outstanding. Announced a final cash dividend for 2024.
GAAP net income in Q4 was RMB578 million, showing a year-over-year decrease of 13.8%.
China's Real Estate Market: The backdrop for BEKE's Q1 earnings remains challenging, although there are signs of moderation in the market's downturn. While sales prices and rents have been declining, the rate of year-on-year price drops for new commercial residential properties began to slow by March 2025. New home sales volume continued to contract in Q1 2025, but at a slower pace (down 2.43% YoY by square meters sold). Government policy easing in major cities, such as the removal of purchasing restrictions and looser mortgage terms, is seen as a stabilizing factor. A significant shift in buyer preference from off-plan new homes to completed new units was observed in Q1 2025. Sales of off-plan homes dropped, while transactions for completed new units rose. This trend could impact BEKE's new home transaction services. Overall market expectations remain cautious for 2025, though some stabilization is hoped for, particularly in higher-tier cities where BEKE has a strong presence.
The number of active stores grew by 18.3% year-over-year to nearly 49,700, and the agent count rose to 445,000, increasing 12.1% year-over-year.
Company Performance & Segments
Existing Home Transactions: This is a core segment for BEKE and may show resilience or different dynamics compared to the developer-driven new home market, especially given the platform's scale.
Revenue from home rental services surged by 135% year-over-year to RMB14.3 billion. The number of rental units under management surpassed 430,000.
New Home Transactions: The performance here will be influenced by the broader market trends for new homes, including the shift towards completed properties.
Decline in New Home GTV : New home GTV for the year was down 3.3% year-over-year, despite a robust rebound in Q4.
Home Renovation and Furnishing: This segment is a growth area for BEKE, and its contribution to Q1 results will be watched.
Achieved total revenue of RMB14.8 billion for the year, a year-over-year increase of 36%. Completed renovation services for nearly 60,000 homes across more than 40 cities.
Operational Efficiency: KE Holdings has been focused on AI-driven enhancements and network expansion to improve customer experience and operational efficiency.
Implemented AI tools like ChatHome and Dreamhome, improving customer experience and operational efficiency. AI Property Service Manager autonomously handles 60% of rental property management tasks.
Revenue from emerging and other services decreased by 41.1% year-over-year in Q4. Faced challenges with declining rents and persistent market oversupply.
KE Holdings (BEKE) Price Target
Based on 18 analysts from Tiger Brokers offering 12 month price targets for KE Holdings Inc. Sponsored ADR Class A in the last 3 months. The average price target is $26.39 with a high forecast of $33.00 and a low forecast of $22.03. The average price target represents a 36.76% change from the last price of $19.30.
Overall, analysts maintain a "Strong Buy" consensus rating for BEKE, with an average 12-month price target of around USD 27.08, suggesting a notable upside from its recent trading price.
Technical Analysis - Exponential Moving Average (EMA)
Even though analysts are maintaining a “Strong Buy” consensus rating for BEKE, the recent stock performance seem to lack momentum, this could be due to the concerns of how the US tariffs talks would actually move, Chinese consumers are holding back on their purchase, especially on big items.
As seen in RSI, the momentum is declining and now the bears are taking control and BEKE need to show some strength by pushing for a daily uptrend above the 26-EMA and 50-EMA.
From the short interest, we are not seeing any signs of investors taking profits or selling off, but the share price might not moved much due to the wait-and-see attitude in views of the trade talks outcome between China and the US. So we might see BEKE in sideway trading from Monday (12 May).
Summary
KE Holdings' Q1 2025 earnings will provide crucial insights into its ability to navigate the still-complex Chinese real estate market. While challenges persist, policy support and shifts in market dynamics (like the preference for completed homes) could present both headwinds and opportunities.
Investors will be looking for signs of stabilization in its core businesses, growth in newer initiatives like home renovation, and commentary on the outlook for the rest of 2025.
Appreciate if you could share your thoughts in the comment section whether you think KE Holdings would be able to ride through the challenges it faced with the still-complex Chinese real estate market.
@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.
Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.
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