"Investor Net" Han Yijia.

Recently, the three major first-tier cities of Beijing, Shanghai, and Guangzhou simultaneously announced tax reduction and household registration policies, once again drawing people's attention to the real estate market.

With the release of a series of new policies for the real estate industry in September, the introduction of "four cancellations" and "four reductions" has continually stimulated market vitality, leading the real estate market into a healthy development track of "stabilization after a decline."

The one-stop new housing service platform, ke holdings, also recently released its financial performance for the third quarter of 2024. During the reporting period, ke holdings achieved a total transaction volume (GTV) of 736.8 billion yuan, a year-on-year increase of 12.5%, with net income of 22.6 billion yuan, a year-on-year increase of 26.8%, and a net profit of 1.168 billion yuan. After adjustments, the net profit reached 1.782 billion yuan, exceeding market consensus expectations.

Peng Yongdong, co-founder, chairman, and CEO of ke holdings, stated, "In the improving external environment, we will firmly look to the long term, continuously explore innovation, promote organizational growth, while maintaining optimism, perseverance, and unity, moving towards a farther future."

"One body, three wings" supports growth and demonstrates development resilience.

In July 2023, Peng Yongdong, co-founder, chairman, and CEO, released an open letter titled "Overcoming the Second Mountain, Sounding the Assembly Call," and after upgrading the "one body, three wings" development strategy, ke holdings has fully released its development potential over the past year, achieving remarkable results at every level.

In the first three quarters of this year, the total transaction volume of ke holdings' existing housing business reached 477.8 billion yuan, a year-on-year increase of 8.8%, with net income of 6.2 billion yuan; the total transaction volume of the new housing business reached 227.6 billion yuan, a year-on-year increase of 18.4%, with net income of 7.7 billion yuan, a year-on-year increase of 30.9%.

The total transaction volume of the home decoration and furniture business reached 4.07 billion yuan, an increase of 24.6% year-on-year, with a net income of 4.2 billion yuan, up 32.6% year-on-year; the net income from the house rental business reached 3.94 billion yuan, growing 118.4% year-on-year.

The income from non-property transaction services increased by 54.3% year-on-year, accounting for 38.3% of total revenue, a significant increase of 6.8 percentage points from the same period last year, reaching a historical high.

In the third quarter, the proportion of new business income for ke holdings further increased, with income from home decoration and furniture business, house rental services, emerging businesses, and other sources accounting for 38.3% of net income, which is an increase of 6.8 percentage points compared to the same period last year.

It can be said that ke holdings is making strides in the business scenarios of home decoration and rental, hoping to build a new engine for long-term sustainable development, gradually moving towards a 'one-stop new residence service platform' that provides consumers with more 'pleasant living' choices.

The impressive performance in business development reflects ke holdings' continuous efforts in platform and system construction.

Moreover, ke holdings has also achieved steady growth in the number of offline stores and brokers. During the reporting period, the number of active stores on the ke holdings platform reached 46,857, a year-on-year increase of 14.6%, with a net addition of nearly 6,000 stores; the number of active brokers reached 423,400, up 6.1% year-on-year. It is the efficient collaboration network and practical empowerment measures of ke holdings that have created strong attraction for external stores, leading to a continuous increase in interconnected stores.

In addition, ke holdings has maintained steady risk control, with the proportion of 'fast commission' income from developers pre-paying commissions remaining high, and the accounts receivable turnover days maintained at a very low level of 47 days. The stable cash collection ability has further enhanced the operational sense of security for brokers, stimulating a stronger willingness to serve.

This year, ke holdings has also been continuously sharing development dividends with investors through ongoing 'cancellation-style' share buybacks. In the third quarter of 2024, ke holdings repurchased stocks at a total cost of about 0.2 billion USD; since the beginning of this year until the end of the third quarter, approximately 0.58 billion USD has been spent on share buybacks, with the number of shares repurchased accounting for about 3.32% of the total share capital at the end of 2023.

In August of this year, ke holdings announced that it had obtained approval from the board of directors to further expand and extend its existing share buyback plan while releasing its mid-term report. The buyback authorization increased from 2 billion dollars to 3 billion dollars, and the buyback plan was extended to August 31, 2025.

Since the launch of the buyback project in September 2022, by the end of the third quarter of this year, approximately 1.49 billion dollars had been repurchased, accounting for about 8.1% of the company's total share capital before the start of the buyback project. This has released confidence in future development.

Xu Tao, the executive director and CFO of ke holdings, stated during the earnings conference call that with a stable cash reserve, shareholder returns will continue to be strengthened through active stock buybacks, further enhancing capital allocation, improving operational efficiency, and sharing the benefits of development with investors. In the future, we will continue to reward shareholders who grow with the company and share the value created by the company.

"The one body and three wings" have forged a robust development pillar for ke holdings, continuously promoting its expansion into diversified business fields. Today, ke holdings, with a technology-driven one-stop new residential service platform as its new identity, is moving towards the next peak.

Operate diligently and innovatively to build an efficient ecological platform.

Peng Yongdong, co-founder, chairman, and CEO of ke holdings, stated in the Q3 conference call, "Determining whether a company has sustainable vitality comes from two factors. The first is to have 'virtue', and the second is to have creativity." Since the business upgrade, ke holdings has taken a leading position in the industry, pioneering the practice of technological and ecological platform construction, further enhancing its operational connotation as a "one-stop new residential service platform."

As a growing company, in terms of ecological construction, ke holdings conducts key work aimed at supporting store owners based on regional co-governance councils, focusing on five directions: operational mechanisms, fairness and transparency, service commitments, business support, and honor systems. This improves the satisfaction of store owners with the platform, creating a competitive and upward cooperative atmosphere.

Mechanically, ke holdings implements a "store points system" directed at store owners. It rewards stores that have been on the platform for a long time, perform well, adhere to bottom lines, and explore innovation in business, helping store owners achieve better returns and realize long-term growth on the platform, enhancing their sense of belonging, honor, professionalism, and management capabilities, consequently serving end consumers better.

Data shows that in the third quarter, among the 9 cities piloting the "store points system", Ke Holdings distributed cash equivalent rights worth over 18 million yuan to store owners through point redemption, with 30% of the stores receiving reward benefits.

In terms of refined operation, Ke Holdings empowers using a more granular strategy based on business districts. For business districts lacking cooperation efficiency among stores, Ke Holdings focuses on available properties through platform data analysis, problem diagnosis, and strategic support, along with the joint participation of store owners' governance council, to increase cooperation among stores. As of the end of September, the ROI of newly signed stores in the first quarter of this year has turned positive.

Peng Yongdong stated: "We are actively expanding in the real estate trading services business while firmly creating a more harmonious ecosystem. Through mechanisms like the 'store points system', we help store owners obtain better returns and receive value feedback from the platform. The direct-operated business of Lianjia also continues to drive innovation and professionalization of agents based on healthy operations. In home improvement and house rental services, we continuously advance the construction of basic capabilities in product, process reshaping, and supply chain areas."

With the deep integration of technology such as AI and big data into the industry, Ke Holdings is also making early layouts to create a data-driven residential development service platform called 'Beihome'. In September, the 'Beihome' business made significant progress by successfully acquiring popular land parcels in the core area of Chengdu, planning to turn it into the first independently operated project by Beihome, reflecting the C2M (from consumer to manufacturer) concept at all stages of land acquisition, positioning, design, and marketing.

From property dictionaries and VR home viewings, to applying the latest AI technology in the home improvement business scenario, Ke Holdings has actively applied artificial intelligence to all aspects of housing services over the years, in line with the trend of technological development. Relying on continuous data resources and practical accumulation, Ke Holdings continuously evolves in standardization, dataization, and intelligence, assisting in the industry's transformative development.

In the conference call for the first three quarters, Ke Holdings CEO Peng Yongdong repeatedly mentioned looking at the long term with determination, emphasizing that in a highly challenging market environment, Ke Holdings’ performance in the third quarter exceeded market consensus expectations, achieving growth across existing homes, new homes, home improvement, and emerging business transaction volumes. Looking to the future, Ke Holdings will continue to uphold long-termism and use practice to respond to the industry proposition of 'beautiful living'. (Produced by Thinking Finance) ■