In recent months, Fengyunjun obviously feels that the frequency of seeing KE Holdings Inc. advertisements has become much higher. In particular, this advertisement for cooperation with the Chinese women's volleyball team is impressive.

Fengyunjun's first reaction is, what will it be like in the financial report? Will the rate of sales expenses increase?

KE Holdings Inc. (BEKE.N) announced its third-quarter results on Nov. 17, Beijing time, which is also the first financial report since the company went public. Fengyunjun couldn't wait to take a look at it. Let's share it.

First, the first three quarters of GTV and revenue exceeded the whole of last year.

The first is the core operating data: GTV (Gross transaction value, turnover).

In the third quarter, KE Holdings Inc. 's GTV broke through the trillion mark for the first time, reaching 1.05 trillion, an increase of 87% over the same period last year. GTV reached 2.38 trillion in the first three quarters of this year, exceeding 2.13 trillion for the whole of last year.

KE Holdings Inc. this volume can also achieve the growth of this data, a little convinced.

In terms of business, the GTV of new housing transactions in the third quarter was 420.7 billion, a year-on-year growth rate of 106%, faster than 72% of the stock, and the total GTV of the two was further approaching. Thanks to KE Holdings Inc. 's leading platform strategy, more and more developers cooperate with the company to sell new homes.

Emerging and other business GTV grew by 153% to 53.2 billion. It is divided into financial business and decoration business. KE Holdings Inc. 's financial business focuses on helping clients complete transactions. In the third quarter, the market penetration of financial business reached 8.6%, an increase of 2.5% from the previous quarter, and the potential space is still very large.

In terms of income, KE Holdings Inc. 's income in the third quarter reached 20.549 billion, an increase of 71% over the same period last year, exceeding market expectations of 18 billion yuan, and revenue growth remained above 70% for two consecutive quarters.。

The total revenue in the first three quarters reached 47.81 billion, an increase of 51% over the same period last year, which also exceeded the revenue for the whole of last year.

Not only that, the adjusted EBITDA, which reflects core profitability, reached 2.248 billion, up 122 per cent from a year earlier.

Do you still remember the two important valuation indicators mentioned in Fengyunjun's previous article, "rising 87% on the first day of listing, with a market capitalization of more than $42 billion: KE Holdings Inc., second only to BABA's second largest business platform in China"-market capitalization / adjusted EBITDA and price-to-sales ratio? Using these two indicators, the company's performance is very strong.

Incidentally, the reason for reducing equity incentives in EBITDA is that there is a really big difference between last year and this year. Only after the adjustment can the real profitability of the company be better reflected.

In addition, the adjusted net profit in the third quarter (note: equity incentives, fair value changes, amortization of intangible assets caused by acquisitions and business cooperation agreements, and the impact of the above on income tax) reached 1.858 billion, an increase of 211% over the same period last year.

KE Holdings Inc. 's financial report has to be said to be very bright. Let's break down the details behind the financial report.

Second, the operation efficiency is eye-catching, and the store efficiency is obviously improved.

From the information disclosed by KE Holdings Inc., we can see that KE Holdings Inc. 's platform strategy is very successful, and the improvement of operational efficiency is also obvious.

Financially, store-related costs (mainly Lianjia brands) increased by only 4% to 833 million yuan in the third quarter compared with the same period last year, accounting for 5.2% of the total cost, and the company's assets are getting lighter and lighter.

According to the publicly searchable information, KE Holdings Inc. scored the stores according to the per capita KE Holdings Inc. score, store performance and key behavior performance, and divided them into A, B, C and D grades.

In the third quarter, the number of A-level stores (referred to as A-stores) on KE Holdings Inc. platform has increased from 4410 at the start of the classification to 10, 000, accounting for as many as 25%, doubling the number of A-stores in only seven months.

And the average efficiency of store A has also improved significantly. At present, the average store efficiency of A stores on KE Holdings Inc. platform has reached 200000, and nearly half of A stores have an annualized GTV of 100 million, that is, an average monthly efficiency of 180000.

In addition, KE Holdings Inc. plans to double store efficiency by 2024, increasing the proportion of 100m GTV/ stores to more than 50 per cent.

As we all know, real estate trading is a labor-intensive industry. KE Holdings Inc. disclosed in his prospectus that the company has nearly 88000 employees, which is already the size of a large company.

However, from the expense rate point of view, KE Holdings Inc. 's operation can be called efficient.

In the first three quarters of 2020, KE Holdings Inc. 's rate of management expenses was 11.9%, and the rates of sales and R & D expenses were 5.0% and 3.7% respectively, totaling 20.6%. Compared with 28.2% in 2018 and 28.4% in 2019, this year's expense rate has dropped significantly, which was done in the case of the black swan outbreak of COVID-19.

In the third quarter, the total expense rate of the three items was 21.7%, an increase of only 0.6 percentage points over the same period last year.

In addition, it is also very obvious in the above picture that the rate of R & D expenditure continues to rise, indicating that KE Holdings Inc. attaches great importance to scientific and technological research and development.

Third, the platform grows and the technology goes out to sea, and the results in the fourth quarter can be seen.

Finally, let's talk about the platform strategy of seashells. Fengyun feels that there are two figures worth looking at. First, the average mobile MAU (including KE Holdings Inc., Lianjia and WeChat Mini Programs) reached 47.9 million in the third quarter, an increase of 82.1 per cent over the same period last year.

Second, the number of real estate agents connected to the company's platform reached 448000 at the end of September, an increase of 50.7% over the same period last year. The company's ACN (Agent Cooperation Network) is becoming more and more powerful.

KE Holdings Inc. 's platform solves the two problems of user traffic and the combination of online and offline real estate agents, which naturally attracts more and more developers.

Do you still remember KE Holdings Inc. 's advertisement that Fengyunjun mentioned at the beginning?

In October, KE Holdings Inc. 's "National New Housing Festival" subscribed for 140000 new houses, with a transaction of 207.8 billion yuan in GTV.A single month is equivalent to 49.4% of the GTV of new houses in the third quarter, nearly half of it. It can be said that the effect is very obvious.

On the other hand, the record in the first week of Singles Day reached 24699 sets and 36.79 billion yuan for GTV. Rongchuang, Vanke, Poly, China Resources and other developers in the KE Holdings Inc. platform to achieve subscription volume of more than 100 million yuan, of which financial innovation exceeded 1 billion yuan.

Of course, these belong to the fourth quarter.

In addition, the company has some real technological innovations, such as VR house viewing and "online loan visa service".

VR looks at the house, we are no strangers. KE Holdings Inc. 's innovation lies in the comprehensive promotion of VR Lite lightweight collection scheme this quarter, so that panoramic cameras and mobile phones can complete VR recording, greatly reducing costs and accelerating VR coverage of housing, which is especially suitable for rental scenarios.

In September, KE Holdings Inc. VR showed more than 40% of the overall viewing volume, which gradually became a user habit.

Not only that, the company also extended this technology to Japan, promoting the VR upgrading of the Japanese residential service market, this is not the technology to go to sea!

Let's talk about "online loan visa service".

Through online verification rooms and other products, KE Holdings Inc. integrates real-name authentication, face recognition, electronic signature, OCR automatic recognition and other technologies to online the process of face-to-face interviews, information collection, and material signing, which reduces the loan interview time by an average of 19%.

In the third quarter, nearly 30 per cent of commercial mortgages brokered by the KE Holdings Inc. platform were completed through the "online loan visa service".

By the end of September, the Shell online loan service has covered more than 1000 branches of 45 cities and 66 cooperative banks across the country.

Needless to say, Fengyunjun is going to find KE Holdings Inc. to buy a house. Oh, no, it's renting.