Investment Insight: Kanzhun Ltd. – A Continued Buy Rating
Kanzhun Ltd. (BZ), a leading provider of integrated human resource solutions in China, has recently reported its Q4 2024 financial results, reaffirming my buy rating on the stock. The company’s robust financial performance and expanding user base demonstrate Kanzhun’s resilience in the face of macroeconomic challenges.
Impressive Financial Performance
Kanzhun’s Q4 2024 results highlighted a 15.4% year-over-year (y/y) increase in revenue to RMB 2.8 billion (approximately USD 422 million). The company’s adjusted earnings before interest, taxes, depreciation, and amortization (EBIT) grew by 27% y/y, reaching RMB 756 million (approximately USD 113 million).
Despite the ongoing macroeconomic softness, Kanzhun’s financial results underscore its ability to generate revenue growth and maintain profitability. This financial strength positions the company well for continued expansion and innovation.
Solid User Activity
Beyond its financial performance, Kanzhun’s user activity remains a significant growth driver. The company’s total number of monthly active users reached 129.2 million in Q4 2024, representing a 12.8% y/y increase. This growth is particularly notable given the increasing competition in the Chinese job market.
Enterprise Demand
Kanzhun’s strong user base translates into significant enterprise demand. The company’s enterprise solutions cater to a wide range of industries and sectors, enabling them to effectively recruit, manage, and retain talent. In Q4 2024, enterprise revenue accounted for 80% of the total revenue, further underscoring the company’s focus on serving large enterprises.
Blue-Collar Penetration
One of Kanzhun’s key growth areas is its blue-collar penetration. Blue-collar roles currently account for 38% of the company’s total revenue, and management expects this percentage to reach 43% by 2027. This expansion into the blue-collar market not only diversifies Kanzhun’s revenue streams but also addresses the significant demand for labor in this sector.
Impact on Individuals
For individuals, the continued growth of Kanzhun could mean increased opportunities for job seekers in various industries and sectors. The company’s focus on blue-collar roles could lead to more accessible and efficient recruitment processes for these workers, ultimately improving their chances of securing employment.
Impact on the World
On a larger scale, Kanzhun’s success could contribute to the overall development of the Chinese labor market. By providing efficient and effective recruitment solutions, the company may help to reduce unemployment or underemployment in certain sectors. Moreover, the integration of artificial intelligence (AI) into recruitment processes could lead to more personalized and data-driven hiring decisions, potentially improving the overall quality of the workforce.
Conclusion
In conclusion, Kanzhun Ltd.’s robust financial performance, solid user activity, and expanding blue-collar presence underscore the company’s position as a leading provider of human resource solutions in China. The continued integration of AI into its offerings further positions Kanzhun for long-term growth and innovation. As an investor, I remain bullish on Kanzhun’s prospects, and I believe that the company’s impact on individuals and the labor market will be significant.
- Kanzhun Ltd. reported strong Q4 2024 financial results, with revenue up 15.4% y/y and adj. EBIT growing 27% y/y.
- User activity remains a significant growth driver, with 129.2 million monthly active users in Q4 2024, representing a 12.8% y/y increase.
- Enterprise demand remains strong, with enterprise revenue accounting for 80% of the total revenue.
- Blue-collar penetration is expanding, with blue-collar roles expected to make up 43% of the total revenue by 2027.
- Individuals may benefit from increased job opportunities and more efficient recruitment processes, while the world could see improvements in the labor market and potential quality of the workforce.
