Yatsen Reported $535 million Revenue with Significant Reduction in Net Loss

Yatsen, the Chinese cosmetics producer, released its 2022 annual report. The company’s revenue reached 3.71 billion yuan ($535 million) in 2022, down 36.54% compared to 2021. Yatsen reported 821 million yuan ($118.53 million) net loss in 2022, which reduced by 725.7 million yuan ($104.73 million) compared to 2021.

Yatsen Holding Ltd is a China-based holding company engaged in production and sales of cosmetics and skincare products. The Company have introduced and purchased several brands in the color cosmetics and skincare industry, such as Perfect Diary, Little Ondine, Abby's Choice, Galénic, DR.WU (for its China-based operations), Eve Lom, Pink Bear, and EANTiM.

The company’s main brand, Perfect Diary, is one of the top-selling color cosmetics brands in China. Yatsen mainly interacts with customers directly through both online and offline channels, and has a wide reach across major e-commerce, social media, and content platforms in China.

During the period, the skincare business grew strongly and the revenue structure continued to improve. The annual revenue of the skincare business reached RMB 1.24 billion ($180 million) in 2022, a year-on-year increase of 45.2%, accounting for 33.5% of the total revenue. The net income of its three major mid-to-high-end skincare brands increased by 99% year-on-year in 2022.

In addition, the revenue of Color Cosmetics Brands reached 2.42 billion ($350 million), down 50.39% compared to 2021.

Meanwhile, Yatsen continued to optimize its cost structure. The financial report showed that its market and sales expense ratio decreased by 5.7 percentage points year-on-year to 62.9% in 2022. Against the backdrop of the overall pressure faced by the cosmetics industry last year, Yatsen continued to promote its strategic transformation, steadily advancing towards high-quality development while shifting its focus to "reducing fat and increasing muscle."

In addition, Yatsen has been increasing its investment in research and development to ensure continuous product innovation. The financial report showed that the company's total R&D investment reached 130 million yuan ($18.77 million) in 2022, with R&D expense ratio continuously increasing from 2.4% in 2021 to 3.4% in 2022, maintaining a leading position among global peers. As of December 31, 2022, Yatsen had applied for 174 patents worldwide, including 43 invention patents (some of which are in the process of being transferred).