Cover Page
Cover Page | 12 Months Ended |
Dec. 31, 2022 shares | |
Document Information | |
Document Type | 20-F |
Document Registration Statement | false |
Document Annual Report | true |
Document Period End Date | Dec. 31, 2022 |
Document Transition Report | false |
Document Shell Company Report | false |
Entity File Number | 001-40460 |
Entity Registrant Name | KANZHUN LIMITED |
Entity Incorporation, State or Country Code | E9 |
Entity Address, Address Line One | 18/F, GrandyVic Building |
Entity Address, Address Line Two | Taiyanggong Middle Road |
Entity Address, Address Line Three | Chaoyang District |
Entity Address, City or Town | Beijing |
Entity Address, Postal Zip Code | 100020 |
Entity Address, Country | CN |
Entity Well-known Seasoned Issuer | Yes |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Emerging Growth Company | false |
ICFR Auditor Attestation Flag | true |
Document Accounting Standard | U.S. GAAP |
Entity Shell Company | false |
Auditor Firm ID | 1424 |
Auditor Name | PricewaterhouseCoopers Zhong Tian LLP |
Auditor Location | Shanghai, the People’s Republic of China |
Entity Central Index Key | 0001842827 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2022 |
Document Fiscal Period Focus | FY |
Amendment Flag | false |
Business Contact | |
Document Information | |
Contact Personnel Name | Yu Zhang |
City Area Code | 86 10 |
Local Phone Number | 8462-8340 |
Contact Personnel Email Address | ir@kanzhun.com |
Entity Address, Address Line One | 18/F, GrandyVic Building |
Entity Address, Address Line Two | Taiyanggong Middle Road |
Entity Address, Address Line Three | Chaoyang District |
Entity Address, City or Town | Beijing |
Entity Address, Postal Zip Code | 100020 |
Entity Address, Country | CN |
American Depositary Shares | |
Document Information | |
Title of 12(b) Security | American depositary shares (each ADS represents two of our Class Aordinary shares, par value US$0.0001 per share) |
Trading Symbol | BZ |
Security Exchange Name | NASDAQ |
Class A ordinary shares | |
Document Information | |
Title of 12(b) Security | Class A ordinary shares, par valueUS$0.0001 per share |
Security Exchange Name | NASDAQ |
Entity Common Stock, Shares Outstanding | 724,582,975 |
No Trading Symbol Flag | true |
Class B ordinary shares | |
Document Information | |
Entity Common Stock, Shares Outstanding | 140,830,401 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS ¥ in Thousands, $ in Thousands | Dec. 31, 2022 CNY (¥) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 CNY (¥) |
Current assets | |||
Cash and cash equivalents | ¥ 9,751,824 | $ 1,413,882 | ¥ 11,341,758 |
Short-term investments | 3,458,089 | 501,376 | 884,996 |
Accounts receivable, net | 9,862 | 1,430 | 1,002 |
Amounts due from related parties | 5,714 | 828 | 6,615 |
Prepayments and other current assets | 600,773 | 87,104 | 724,583 |
Total current assets | 13,826,262 | 2,004,620 | 12,958,954 |
Non-current assets | |||
Property, equipment and software, net | 691,036 | 100,191 | 369,126 |
Intangible assets, net | 10,251 | 1,486 | 458 |
Goodwill | 5,690 | 825 | |
Right-of-use assets, net | 289,628 | 41,992 | 309,085 |
Other non-current assets | 4,000 | 580 | 4,000 |
Total non-current assets | 1,000,605 | 145,074 | 682,669 |
Total assets | 14,826,867 | 2,149,694 | 13,641,623 |
Current liabilities | |||
Accounts payable | 185,297 | 26,866 | 52,963 |
Deferred revenue | 2,060,892 | 298,801 | 1,958,570 |
Other payables and accrued liabilities | 633,482 | 91,846 | 645,138 |
Operating lease liabilities, current | 151,438 | 21,956 | 127,531 |
Total current liabilities | 3,031,109 | 439,469 | 2,784,202 |
Non-current liabilities | |||
Operating lease liabilities, non-current | 143,591 | 20,819 | 183,365 |
Deferred tax liabilities | 11,404 | 1,653 | |
Total non-current liabilities | 154,995 | 22,472 | 183,365 |
Total liabilities | 3,186,104 | 461,941 | 2,967,567 |
Commitments and contingencies | |||
Shareholders' equity | |||
Ordinary shares (US$0.0001 par value; 2,000,000,000 shares authorized, 748,953,103 Class A ordinary shares issued and 727,855,233 outstanding, 140,830,401 Class B ordinary shares issued and outstanding as of December 31, 2021; 1,800,000,000 Class A ordinary shares authorized, 749,323,103 issued and 724,582,975 outstanding, 200,000,000 Class B ordinary shares authorized, 140,830,401 issued and outstanding as of December 31, 2022) | 564 | 82 | 554 |
Treasury shares | (918,894) | (133,227) | |
Additional paid-in capital | 15,450,389 | 2,240,096 | 14,624,386 |
Accumulated other comprehensive (loss)/income | 695,184 | 100,793 | (257,765) |
Accumulated deficit | (3,586,480) | (519,991) | (3,693,119) |
Total shareholders' equity | 11,640,763 | 1,687,753 | 10,674,056 |
Total liabilities and shareholders' equity | ¥ 14,826,867 | $ 2,149,694 | ¥ 13,641,623 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2022 | Dec. 31, 2021 |
Common stock par or stated value per share | $ 0.0001 | $ 0.0001 |
Common stock shares authorized | 2,000,000,000 | |
Class A ordinary shares | ||
Common stock shares authorized | 1,800,000,000 | |
Common stock shares issued | 749,323,103 | 748,953,103 |
Common stock shares outstanding | 724,582,975 | 727,855,233 |
Class B ordinary shares | ||
Common stock shares authorized | 200,000,000 | |
Common stock shares issued | 140,830,401 | 140,830,401 |
Common stock shares outstanding | 140,830,401 | 140,830,401 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS)/INCOME ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 CNY (¥) ¥ / shares shares | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 CNY (¥) ¥ / shares shares | Dec. 31, 2020 CNY (¥) ¥ / shares shares | |
Revenues | ||||
Total revenues | ¥ 4,511,062 | $ 654,042 | ¥ 4,259,128 | ¥ 1,944,359 |
Operating cost and expenses | ||||
Cost of revenues | (754,861) | (109,445) | (554,648) | (240,211) |
Sales and marketing expenses | (2,000,900) | (290,103) | (1,942,670) | (1,347,532) |
Research and development expenses | (1,182,716) | (171,478) | (821,984) | (513,362) |
General and administrative expenses | (719,699) | (104,347) | (1,991,123) | (797,008) |
Total operating cost and expenses | (4,658,176) | (675,373) | (5,310,425) | (2,898,113) |
Other Operating Income Expense Net | 17,595 | 2,551 | 14,977 | 8,849 |
Loss from operations | (129,519) | (18,780) | (1,036,320) | (944,905) |
Investment income | 65,150 | 9,446 | 24,744 | 9,095 |
Financial income, net | 161,332 | 23,391 | 9,735 | 3,098 |
Foreign exchange (loss)/gain | 8,627 | 1,251 | (1,961) | (5,074) |
Other (expenses)/income, net | 11,406 | 1,654 | (7,745) | (4,109) |
(Loss)/Income before income tax expenses | 116,996 | 16,962 | (1,011,547) | (941,895) |
Income tax expenses | (9,751) | (1,414) | (59,527) | |
Net (loss)/income | 107,245 | 15,548 | (1,071,074) | (941,895) |
Accretion on convertible redeemable preferred shares to redemption value | ¥ | (164,065) | (283,981) | ||
Net (loss)/income attributable to ordinary shareholders | 107,245 | 15,548 | (1,235,139) | (1,225,876) |
Other comprehensive (loss)/income | ||||
Foreign currency translation adjustments | 952,949 | 138,165 | (127,378) | (149,539) |
Total comprehensive (loss)/income | ¥ 1,060,194 | $ 153,713 | ¥ (1,198,452) | ¥ (1,091,434) |
Weighted average number of ordinary shares used in computing net (loss)/income per share | ||||
- Basic | 868,941,151 | 868,941,151 | 529,343,027 | 111,172,986 |
- Diluted | 912,141,991 | 912,141,991 | 529,343,027 | 111,172,986 |
Net (loss)/income per share attributable to ordinary shareholders | ||||
- Basic | (per share) | ¥ 0.12 | $ 0.02 | ¥ (2.33) | ¥ (11.03) |
- Diluted | (per share) | ¥ 0.12 | $ 0.02 | ¥ (2.33) | ¥ (11.03) |
Online recruitment services to enterprise customers | ||||
Revenues | ||||
Total revenues | ¥ 4,461,282 | $ 646,825 | ¥ 4,219,026 | ¥ 1,927,178 |
Others | ||||
Revenues | ||||
Total revenues | ¥ 49,780 | $ 7,217 | ¥ 40,102 | ¥ 17,181 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' (DEFICIT)/EQUITY ¥ in Thousands, $ in Thousands | Cumulative-effect adjustment Accumulated deficit CNY (¥) | Cumulative-effect adjustment CNY (¥) | Ordinary shares TECHWOLF LIMITED CNY (¥) shares | Ordinary shares IPO CNY (¥) shares | Ordinary shares CNY (¥) shares | Treasury shares Consolidated VIE shares | Treasury shares CNY (¥) shares | Additional paid-in capital TECHWOLF LIMITED CNY (¥) | Additional paid-in capital IPO CNY (¥) | Additional paid-in capital CNY (¥) | Accumulated other comprehensive (loss)/income CNY (¥) | Accumulated deficit CNY (¥) | TECHWOLF LIMITED CNY (¥) | Consolidated VIE CNY (¥) | IPO CNY (¥) | CNY (¥) shares | USD ($) shares |
Balance (in shares) at Dec. 31, 2019 | shares | 100,080,000 | ||||||||||||||||
Balance at Dec. 31, 2019 | ¥ 62 | ¥ 19,152 | ¥ (1,680,150) | ¥ (1,660,936) | |||||||||||||
Net loss/income | (941,895) | ¥ (303,061) | (941,895) | ||||||||||||||
Foreign currency translation adjustments | (149,539) | (149,539) | |||||||||||||||
Share-based compensation | ¥ 124,105 | 124,105 | |||||||||||||||
Accretion on convertible redeemable preferred shares to redemption value | (283,981) | (283,981) | |||||||||||||||
Issuance of ordinary shares, Shares | shares | 4,122,853 | 3,657,853 | |||||||||||||||
Issuance of ordinary shares, Value | ¥ 3 | 78,995 | ¥ 78,998 | ||||||||||||||
Issuance of Class B ordinary shares to TECHWOLF LIMITED, Shares | shares | 24,780,971 | ||||||||||||||||
Issuance of Class B ordinary shares to TECHWOLF LIMITED, Value | ¥ 16 | ¥ 533,115 | ¥ 533,131 | ||||||||||||||
Exercise of share-based awards, Shares | shares | 5,597,960 | 5,597,960 | |||||||||||||||
Balance (in shares) at Dec. 31, 2020 | shares | 128,983,824 | 3,657,853 | |||||||||||||||
Balance at Dec. 31, 2020 | ¥ 81 | 452,234 | (130,387) | (2,622,045) | ¥ (2,300,117) | ||||||||||||
Net loss/income | (1,071,074) | 551,133 | (1,071,074) | ||||||||||||||
Foreign currency translation adjustments | (127,378) | (127,378) | |||||||||||||||
Share-based compensation | 417,284 | 417,284 | |||||||||||||||
Accretion on convertible redeemable preferred shares to redemption value | (164,065) | (164,065) | |||||||||||||||
Repurchase and cancellation of ordinary shares, Shares | shares | (1,181,339) | ||||||||||||||||
Repurchase and cancellation of ordinary shares, Value | ¥ (1) | (42,263) | (42,264) | ||||||||||||||
Issuance of ordinary shares, Shares | shares | 110,400,000 | ||||||||||||||||
Issuance of ordinary shares, Value | ¥ 70 | ¥ 6,406,802 | ¥ 6,406,872 | ||||||||||||||
Issuance of Class B ordinary shares to TECHWOLF LIMITED, Shares | shares | 24,745,531 | ||||||||||||||||
Issuance of Class B ordinary shares to TECHWOLF LIMITED, Value | ¥ 16 | ¥ 1,506,346 | ¥ 1,506,362 | ||||||||||||||
Exercise of share-based awards | ¥ 35 | 193,740 | ¥ 193,775 | ||||||||||||||
Exercise of share-based awards, Shares | shares | 54,385,484 | (10,346,053) | 54,385,484 | 54,385,484 | |||||||||||||
Conversion of convertible redeemable preferred shares, Shares | shares | 551,352,134 | ||||||||||||||||
Conversion of convertible redeemable preferred shares, Value | ¥ 353 | 5,854,308 | ¥ 5,854,661 | ||||||||||||||
Issuance of ordinary shares for share award plan | shares | 27,786,070 | ||||||||||||||||
Balance (in shares) at Dec. 31, 2021 | shares | 868,685,634 | 21,097,870 | |||||||||||||||
Balance at Dec. 31, 2021 | ¥ 554 | 14,624,386 | (257,765) | (3,693,119) | 10,674,056 | ||||||||||||
Net loss/income | 107,245 | ¥ 117,298 | 107,245 | $ 15,548 | |||||||||||||
Foreign currency translation adjustments | 952,949 | 952,949 | $ 138,165 | ||||||||||||||
Share-based compensation | 692,204 | 692,204 | |||||||||||||||
Exercise of share-based awards | ¥ 10 | 133,799 | ¥ 133,809 | ||||||||||||||
Exercise of share-based awards, Shares | shares | 14,372,840 | (14,372,840) | 12,413,256 | 12,413,256 | |||||||||||||
Issuance of ordinary shares for share award plan | shares | 370,000 | ||||||||||||||||
Repurchase of ordinary shares | ¥ (918,894) | ¥ (918,894) | |||||||||||||||
Repurchase of ordinary shares (in shares) | shares | (17,645,098) | 17,645,098 | |||||||||||||||
Balance (in shares) at Dec. 31, 2022 | shares | 865,413,376 | 24,740,128 | |||||||||||||||
Balance at Dec. 31, 2022 | ¥ (606) | ¥ (606) | ¥ 564 | ¥ (918,894) | ¥ 15,450,389 | ¥ 695,184 | ¥ (3,586,480) | ¥ 11,640,763 | $ 1,687,753 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 CNY (¥) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2020 CNY (¥) | |
Cash flows from operating activities | ||||
Net (loss)/income | ¥ 107,245 | $ 15,548 | ¥ (1,071,074) | ¥ (941,895) |
Adjustments to reconcile net (loss)/income to net cash generated from operating activities: | ||||
Share-based compensation | 692,204 | 100,360 | 417,284 | 124,105 |
Issuance of Class B ordinary shares to TECHWOLF LIMITED | 1,506,362 | 533,131 | ||
Depreciation and amortization | 140,078 | 20,309 | 80,100 | 41,095 |
Loss/(Gain) from disposal of property, equipment and software | (96) | (14) | 110 | 230 |
Foreign exchange loss/(gain) | (8,627) | (1,251) | 1,961 | 5,074 |
Amortization of right-of-use assets | 147,322 | 21,360 | 109,336 | 66,946 |
Unrealized investment income | (43,716) | (6,338) | (6,595) | |
Deferred income tax expenses | 9,324 | 1,352 | ||
Allowance for credit losses | 336 | 49 | ||
Changes in operating assets and liabilities: | ||||
Accounts receivable | (5,982) | (867) | 5,997 | (5,201) |
Prepayments and other current assets | 13,321 | 1,931 | (403,696) | (46,146) |
Amounts due from related parties | 901 | 131 | 3,503 | (2,938) |
Other non-current assets | (4,000) | |||
Accounts payable | 10,179 | 1,476 | 13,464 | (22,746) |
Deferred revenue | 102,322 | 14,835 | 758,221 | 585,529 |
Other payables and accrued liabilities | (18,037) | (2,615) | 329,802 | 130,541 |
Operating lease liabilities | (143,732) | (20,839) | (99,394) | (71,814) |
Net cash generated from operating activities | 1,003,042 | 145,427 | 1,641,381 | 395,911 |
Cash flows from investing activities | ||||
Purchase of property, equipment and software | (340,120) | (49,313) | (259,891) | (138,211) |
Proceeds from disposal of property, equipment and software | 324 | 47 | 29 | 36 |
Purchase of short-term investments | (5,213,058) | (755,822) | (3,940,000) | (1,834,390) |
Proceeds from maturity of short-term investments | 2,746,201 | 398,162 | 3,598,000 | 2,439,870 |
Acquisition of a subsidiary, net of cash acquired | (9,928) | (1,439) | ||
Net cash generated from/(used in) investing activities | (2,816,581) | (408,365) | (601,862) | 467,305 |
Cash flows from financing activities | ||||
Proceeds from issuance of convertible redeemable preferred shares, net of issuance cost | 2,803,114 | |||
Proceeds from issuance of Class A ordinary shares | 78,998 | |||
Proceeds from the US IPO, net of issuance cost | 6,406,872 | |||
Proceeds from exercise of share options | 249,662 | 36,198 | 35,975 | |
Net cash generated from/(used in) financing activities | (669,232) | (97,029) | 6,431,263 | 2,882,112 |
Effect of exchange rate changes on cash and cash equivalents | 892,837 | 129,449 | (127,227) | (154,480) |
Net increase/(decrease) in cash and cash equivalents | (1,589,934) | (230,518) | 7,343,555 | 3,590,848 |
Cash and cash equivalents at beginning of the year | 11,341,758 | 1,644,400 | 3,998,203 | 407,355 |
Cash and cash equivalents at end of the year | 9,751,824 | 1,413,882 | 11,341,758 | 3,998,203 |
Supplemental cash flow disclosure | ||||
Cash paid for income tax | 101,293 | 14,686 | ||
Supplemental schedule of non-cash investing and financing activities | ||||
Accretion on convertible redeemable preferred shares to redemption value | 164,065 | 283,981 | ||
Changes in payables for purchase of property, equipment and software | 122,155 | 17,711 | (2,357) | ¥ 21,985 |
Class A ordinary shares | ||||
Cash flows from financing activities | ||||
Repurchase of ordinary shares | ¥ (918,894) | $ (133,227) | ||
Class B ordinary shares | ||||
Cash flows from financing activities | ||||
Repurchase of ordinary shares | ¥ (11,584) |
PRINCIPAL ACTIVITIES AND ORGANI
PRINCIPAL ACTIVITIES AND ORGANIZATION | 12 Months Ended |
Dec. 31, 2022 | |
PRINCIPAL ACTIVITIES AND ORGANIZATION | |
PRINCIPAL ACTIVITIES AND ORGANIZATION | 1. (a) Principal activities KANZHUN LIMITED (the “Company”) was incorporated under the laws of the Cayman Islands on January 16, 2014 as an exempted company with limited liability. The Company, through its subsidiaries, consolidated variable interest entity (the “VIE”) and VIE’s subsidiaries (collectively referred to as the “Group”), is primarily engaged in providing online recruitment services through a platform named “BOSS Zhipin” in the People’s Republic of China (the “PRC” or “China”). (b) Organization of the Group As of December 31, 2022, the Company’s principal subsidiaries and consolidated VIE are as follows: Company name Place of incorporation Date of incorporation Equity interest/economic interest held Principal activities and place of operation Principal subsidiaries Techfish Limited Hong Kong, China February 14, 2014 100% Investment holding in Hong Kong Beijing Glory Wolf Co., Ltd. (the “WFOE”) Beijing, China May 7, 2014 100% Management consultancy and technical services in the PRC VIE Beijing Huapin Borui Network Technology Co., Ltd. (“Huapin”) Beijing, China December 25, 2013 100% Online recruitment services in the PRC (c) Consolidated variable interest entity In order to comply with the PRC laws and regulations which prohibit or restrict foreign investments into companies involved in restricted businesses, the Group operates its restricted businesses in the PRC mainly through the VIE, Huapin and its subsidiaries, whose equity interests are held by certain management members of the Group (the “Registered Shareholders”). By entering into a series of contractual arrangements with Huapin and its respective Registered Shareholders, which were updated in September 2022, the Company has the power to direct activities of Huapin that most significantly affect its economic performance and receive substantially all of the economic benefits from Huapin. Accordingly, the Company obtained a controlling financial interest in the VIE. The Company is determined to be the ultimate primary beneficiary of the VIE, and therefore consolidates the VIE’s results of operations, assets and liabilities in the Group’s consolidated financial statements under the accounting principles generally accepted in the United States of America (“U.S. GAAP”). The principal terms of the contractual agreements entered into by and among the Company, through the WFOE, the VIE and the Registered Shareholders are further described below. 1. PRINCIPAL ACTIVITIES AND ORGANIZATION (CONTINUED) (c) Consolidated variable interest entity (continued) Exclusive Technology and Service Co-operation Agreement Pursuant to the Exclusive Technology and Service Co-operation Agreement, the VIE has agreed to engage the WFOE as the exclusive provider of management consultancy, technical and other services as agreed. The VIE shall pay service fee to the WFOE, which shall be equivalent to total consolidated profit of the VIE and its subsidiaries, after offsetting the prior-year accumulated loss (if any), operating cost and expenses, taxes and other statutory contributions. Notwithstanding the foregoing, the WFOE shall have the right to adjust the level of the service fee by taking into account such factors as (a) the complexity and difficulty of the services, (b) the time taken for the services, (c) the scope and commercial value of the management consultancy, technical and other services, (d) the scope and commercial value of intellectual property licensing and leasing services, and (e) the market reference price for services of similar kinds. The VIE shall pay the service fee within 30 days after the delivering of payment instructions by the WFOE. The Exclusive Technology and Service Co-operation Agreement shall remain effective until, among others, the date on which the WFOE or its designated party is formally registered as the shareholder of the VIE, in the case where the WFOE is permitted by the PRC laws to directly hold the VIE’s equity interests and the WFOE and its subsidiaries and branches are allowed to engage in the business being currently operated by the VIE. Exclusive Purchase Option Agreement Pursuant to the Exclusive Purchase Option Agreement, the Registered Shareholders of the VIE have granted the WFOE or its offshore parent company or its directly or indirectly owned subsidiaries, an exclusive and irrevocable right to purchase all or any part of the respective equity interests in the VIE from the Registered Shareholders. Among others, the VIE and the Registered Shareholders irrevocably covenanted that unless with prior written consent by the WFOE, the VIE shall not sell, transfer, pledge, or otherwise dispose all or any part of its assets (other than the assets necessary for its ordinary course of business) , and the Registered Shareholders shall not sell, transfer, pledge, or otherwise dispose all or any part of their equity interests in the VIE, other than the pledge of the VIE’s equity interests pursuant to these contractual arrangements. The purchase price payable by the WFOE or its designee in respect of the transfer of the entire equity interests and/or total assets of the VIE shall be the nominal price, or the minimum price required by relevant PRC authorities or PRC laws. However, in any event, subject to the provisions and requirements of PRC laws, the price paid by the WFOE and/or its designee to the VIE and/or Registered Shareholders at any such price shall be returned by the VIE and/or Registered Shareholders at the time and in the form requested by the WFOE. The Exclusive Purchase Option Agreement shall remain effective for ten years with the WFOE having the option to renew it until all the equity interests in and/or all assets of the VIE have been transferred to the WFOE and/or its designee (registration has been completed for the change of members), and the WFOE and its subsidiaries and branches can legally engage in the business of the VIE. Equity Pledge Agreement Pursuant to the Equity Pledge Agreement, the Registered Shareholders of the VIE have pledged all of equity interests in the VIE to the WFOE to guarantee performance of their obligations under the contractual arrangements and all liabilities, monetary debts or other payment obligations arising out of or in relation with the contractual arrangements. In the event of a breach by the VIE or any of its Registered Shareholders of contractual obligations under the Equity Pledge Agreement, the WFOE will have the right to (1) demand all the outstanding payments according to the Exclusive Technology and Service Co-operation Agreement, and/or (2) exercise its right of pledge according to the Equity Pledge Agreement, or otherwise dispose of the pledged equity interests in accordance with applicable laws, unless the event of default has been resolved in the satisfactory of the WFOE in time. The Equity Pledge Agreement shall remain valid until, among others, the VIE and the Registered Shareholders have recorded the release of such pledged equity interests in the register of members of the VIE and completed relevant deregistration procedure. 1. PRINCIPAL ACTIVITIES AND ORGANIZATION (CONTINUED) Spousal Consent Letter Pursuant to the Spousal Consent Letter, the spouses of the Registered Shareholders unconditionally and irrevocably consented to the execution of the relevant contractual agreements and to the disposal in accordance therewith of the equity interests in the VIE held by the Registered Shareholders (as the case may be). Additionally, each of the spouses agreed not to make any claim with respect to the equity interests in the VIE held by such Registered Shareholder, and to be bound by the relevant contractual agreements if for any reason the spouses acquire any equity interest in VIE held by each Registered Shareholder. Power of Attorney Pursuant to the Power of Attorney, each of the Registered Shareholders appointed the WFOE and/or its designee as their sole and exclusive agent to act on their behalf on all matters concerning the VIE and to exercise all of their rights as shareholders of the VIE, including but not limited to (1) to propose, convene and attend shareholders meetings and sign minutes and resolutions, (2) to exercise all shareholder rights that they are entitled to under PRC law and the relevant articles of association, including but not limited to, the right to vote and the right to sell, transfer, pledge or disposal of all or part of their shareholding; and (3) to elect, designate and appoint the legal representative, chairman, directors, supervisors, general manager and other senior executives of the VIE. (d) Risks in relations to the VIE structure The Group believes that the above contractual arrangements between or among the WFOE, VIE and the Registered Shareholders are following PRC laws and regulations as applicable. However, uncertainties in the PRC legal system could limit the Company’s ability to enforce these contractual arrangements. The PRC Foreign Investment Law effect from January 1, 2020 doesn’t explicitly classify contractual arrangements as a form of foreign investments. There are substantial uncertainties with respect to its implementation and interpretation and the possibility that the VIE will be deemed as a foreign-invested enterprise and subject to relevant restrictions in the future shall not be excluded. If the contractual arrangements establishing the Company’s VIE structure are found to be in violation of any existing or future PRC law and regulations, the relevant PRC government authorities will have broad discretion in dealing with such violation, including without limitation, levying fines, confiscating the Group’s income or the income from the VIE, revoking the Group’s business licenses or operating licenses, requiring the Group to restructure its ownership structure or operations or to discontinue any portion or all of the Group’s prohibited businesses. The imposition of these penalties may result in a severe adverse impact on the Company’s ability to direct the activities of the VIE or receive economic benefits from the VIE, which may result in the deconsolidation of the VIE. 1. PRINCIPAL ACTIVITIES AND ORGANIZATION (CONTINUED) (d) Risks in relations to the VIE structure (continued) The following table set forth the financial information of the VIE and VIE’s subsidiaries included in the Group’s consolidated financial statements after the elimination of intercompany balances and transactions among the VIE and its subsidiaries within the Group: As of December 31, 2021 2022 RMB RMB ASSETS Current assets Cash and cash equivalents 864,851 1,020,243 Short-term investments 864,557 1,244,243 Accounts receivable, net 1,002 2,253 Amounts due from Group companies 86,989 136,757 Amounts due from related parties 6,615 5,714 Prepayments and other current assets 487,598 528,908 Total current assets 2,311,612 2,938,118 Non-current assets Property, equipment and software, net 368,381 688,578 Intangible assets, net 458 368 Right-of-use assets, net 301,288 281,913 Other non-current assets 4,000 4,000 Total non-current assets 674,127 974,859 Total assets 2,985,739 3,912,977 LIABILITIES Current liabilities Accounts payable 52,938 185,211 Deferred revenue 1,958,570 2,058,569 Other payables and accrued liabilities 626,151 576,189 Amounts due to Group companies 27,223 14,876 Operating lease liabilities, current 124,464 146,359 Total current liabilities 2,789,346 2,981,204 Non-current liabilities Operating lease liabilities, non-current 178,844 141,096 Deferred tax liabilities — 9,427 Total non-current liabilities 178,844 150,523 Total liabilities 2,968,190 3,131,727 1. PRINCIPAL ACTIVITIES AND ORGANIZATION (CONTINUED) (d) Risks in relations to the VIE structure (continued) For the year ended December 31, 2020 2021 2022 RMB RMB RMB Total revenues 1,944,359 4,259,128 4,498,131 Cost of revenues (232,261) (554,575) (750,932) Net ( loss )/income (303,061) 551,133 117,298 For the year ended December 31, 2020 2021 2022 RMB RMB RMB Net cash generated from operating activities 494,187 1,717,104 893,078 Net cash used in investing activities (632,568) (591,213) (702,542) Net cash generated from/(used in) financing activities 260,484 (444,239) (35,144) Net increase in cash and cash equivalents 122,103 681,652 155,392 Cash and cash equivalents at beginning of the year 61,096 183,199 864,851 Cash and cash equivalents at end of the year 183,199 864,851 1,020,243 Under the contractual arrangements with the VIE, the Company has the power to direct activities of the VIE through the WFOE that most significantly impact the VIE such as having assets transferred out of the VIE at its discretion. Therefore, the Company considers that there is no asset of the VIE that can be used to settle obligations of the VIE except for registered capital and any PRC statutory reserves of the VIE, which amounted to RMB9,002 and RMB9,002 as of December 31, 2021 and 2022, respectively. Since the VIE was incorporated as a limited liability company under the PRC Company Law, the creditors do not have recourse to the general credit of the WFOE for all the liabilities of the VIE. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Basis of presentation The accompanying consolidated financial statements have been prepared in accordance with U.S. GAAP. Significant accounting policies followed by the Group in the preparation of its accompanying consolidated financial statements are summarized below. (b) Basis of consolidation The consolidated financial statements include the financial statements of the Company, its subsidiaries, the consolidated VIE and VIE’s subsidiaries for which the Company is the ultimate primary beneficiary. A subsidiary is an entity in which the Company, directly or indirectly, controls more than one half of the voting power; or has the power to appoint or remove the majority of the members of the board of directors, to cast a majority of votes at the meeting of the board of directors or to govern the financial and operating policies under a statute or agreement among the shareholders or equity holders. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (b) Basis of consolidation (continued) The Company applies the guidance codified in ASC 810, Consolidations All transactions and balances between the Company, its subsidiaries, the consolidated VIE and VIE’s subsidiaries have been eliminated upon consolidation. (c) Use of estimates The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the balance sheet dates and revenues and expenses during the reporting periods. Accounting estimates reflected in the Group’s consolidated financial statements include, but are not limited to, useful lives of property, equipment and software and intangible assets, impairment assessments of long-lived assets and goodwill, fair value of assets acquired and liabilities assumed in a business combination, valuation allowance for deferred tax assets, the provision for credit losses of financial assets and valuation of share-based compensation. Management bases the estimates on historical experience, known trends and various other assumptions that are believed to be reasonable under current circumstances. Actual results could differ from those estimates. (d) Functional currency and foreign currency translation The Group’s reporting currency is Renminbi (“RMB”). The functional currency of the Company and subsidiaries incorporated in Hong Kong and the United States of America, is the United States dollars (“US$”). The functional currency of the Group’s PRC subsidiaries, consolidated VIE and VIE’s subsidiaries is RMB. The determination of the respective functional currency is based on the criteria of ASC 830, Foreign Currency Matters Transactions denominated in currencies other than the functional currency are translated into the functional currency of the entity at the exchange rates quoted by authoritative banks prevailing on the transaction dates. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency using the applicable exchange rates at the balance sheet dates. Exchange gain or loss resulting from those foreign currency transactions denominated in foreign currencies is recorded in foreign exchange gain/(loss) the consolidated financial statements. The financial statements of the Company and subsidiaries located outside of the PRC are translated from their functional currency into RMB. Their assets and liabilities are translated into RMB using the applicable exchange rates at the balance sheet date. Equity accounts other than earnings generated in current period are translated into RMB at the appropriate historical rates. Revenues, expenses, gain and loss are translated into RMB using the periodic average exchange rates. The resulting foreign currency translation adjustments are recorded in other comprehensive income/(loss) in the consolidated financial statements. (e) Convenience translation Translations of the consolidated balance sheets, the consolidated statements of comprehensive income/(loss) and the consolidated statements of cash flows from RMB into US$ as of and for the year ended December 31, 2022 are solely for the convenience of the readers, and were calculated at the rate of RMB6.8972 per US$1.00 on December 30, 2022 as set forth in the H.10 statistical release of the U.S. Federal Reserve Board. No representation is made that the RMB amounts could have been, or could be, converted, realized or settled into US$ at that rate or at any other rate. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (f) Fair value measurement Accounting guidance defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurement for assets and liabilities required or permitted to be recorded at fair value, the Group considers the principal or most advantageous market in which it would transact and it considers assumptions that market participants would use when pricing the asset or liability. Accounting guidance establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Accounting guidance establishes three levels of inputs that may be used to measure fair value: ● Level 1 – Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. ● Level 2 – Include other inputs that are directly or indirectly observable in the marketplace. ● Level 3 – Unobservable inputs which are supported by little or no market activity. Accounting guidance also describes three main approaches to measuring the fair value of assets and liabilities: (1) market approach; (2) income approach and (3) cost approach. The market approach uses prices and other relevant information generated from market transactions involving identical or comparable assets or liabilities. The income approach uses valuation techniques to convert future amounts to a single present value amount and the measurement is based on the value indicated by current market expectations about those future amounts. The cost approach is based on the amount that would currently be required to replace an asset. Financial assets and liabilities of the Group mainly consist of cash and cash equivalents, short-term investments, accounts receivable, amounts due from related parties, prepayments and other current assets, accounts payable and other current liabilities. Except for short-term investments, the carrying values of other financial assets and liabilities approximate their fair values due to the short-term maturity of these instruments. The Group reports short-term investments at fair value based on Level 2 measurement. (g) Business combination Business combinations are recorded using the purchase method of accounting in accordance with ASC 805, Business Combinations (h) Cash and cash equivalents Cash and cash equivalents include cash on hand, deposits and highly liquid investments that are readily convertible to known amounts of cash, which have original maturities of three months or less. 2. (i) Short-term investments Short-term investments mainly include wealth management products issued by financial institutions, which are principal-not-guaranteed or with original maturities longer than three months but less than one year. These investments are stated at fair value and changes in the fair value are reflected in investment income in the consolidated statements of comprehensive income/(loss). Additionally, short-term investments are comprised of deposits with original maturities longer than three months but less than one year. (j) Accounts receivable, net Accounts receivable are presented net of allowance for credit losses. The Group adopts ASC 326 from 2022 and provides an allowance against accounts receivable based on the expected credit loss approach as described in Note 2(aa). No material allowance was recognized for the years ended December 31, 2020, 2021 and 2022. (k) Property, equipment and software Property, equipment and software are stated at cost less accumulated depreciation and impairment, if any. Property, equipment and software are depreciated over the estimated useful lives on a straight-line basis. The estimated useful lives are as follows: Category Estimated useful lives Electronic equipment 3-5 years Leasehold improvement Shorter of lease term or estimated useful life of the assets Furniture and fixtures 5 years Motor vehicles 3-5 years Software 5 years The majority of electronic equipment are servers. The Group recognized the gain or loss on the disposal of property, equipment and software in other operating income/(expenses) in the consolidated statements of comprehensive income/(loss). 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (l) Intangible Assets Intangible assets purchased are initially recognized at cost, and intangible assets acquired in a business combination are initially recorded at fair value as of the acquisition date. Intangible assets with finite useful lives are amortized on a straight-line basis over the estimated useful lives, which are determined based on the period of contractual rights or estimated period during which such assets can bring economic benefits to the Group. The estimated useful lives are as follows: Category Estimated useful lives Domains 10 years Non-compete agreements 6 years Trademarks 3 years Database 3 years (m) Impairment of long-lived assets other than goodwill Long-lived assets, such as fixed assets and intangible assets with finite lives, are evaluated for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be fully recoverable. The Group evaluates the impairment for the long-lived assets by comparing the carrying value of the assets to the undiscounted future cash flows expected to be generated from the use of the assets and their eventual disposition. If the sum of the expected undiscounted future cash flows is less than the carrying value of the asset, the Group recognizes an impairment loss based on the excess of the carrying value of the asset over the fair value of the asset. No impairment of long-lived assets was recognized for the years ended December 31, 2020, 2021 and 2022. (n) Goodwill Goodwill represents the excess of the purchase price over the fair value of the identifiable assets and liabilities acquired or assumed in a business combination. Goodwill is tested for impairment at least annually and more frequently when an event occurs or circumstances change that could indicate that the asset might be impaired. In accordance with ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (o) Revenue recognition The Group accounted for revenue under ASC 606, Revenue from Contracts with Customers According to ASC 606, revenue is recognized net of value-added tax (“VAT”) when or as the control of services is transferred to a customer. Depending on the terms of the contract, control of services may be transferred over time or at a point in time. Control of services is transferred over time if one of the following criteria is met: (i) customers simultaneously receive and consume the benefits provided by the Group’s performance; (ii) the Group’s performance creates or enhances an asset that customers control; or (iii) the Group’s performance does not create an asset with an alternative use to the Group and the Group has an enforceable right to payments for performance completed to date. If control of services is transferred over time, revenue is recognized over the period of the contract by reference to the progress towards complete satisfaction of that performance obligation. Otherwise, revenue is recognized at a point in time when customers obtain control of the services. Online recruitment services to enterprise customers The Group provides online recruitment services with different kinds of features to enterprise customers, including direct recruitment services such as job postings, and value-added tools such as bulk invite sending, which could be purchased as a part of a package or on a standalone basis. Based on the pattern by which the Group provides services and how enterprise customers benefit from services, these services can be divided into two categories in terms of revenue recognition: (i) services over a particular subscription period, which provide enterprise customers certain rights during a particular subscription period; for example, paid job postings allow enterprise customers to present certain job positions, receive job seeker recommendations, browse the mini-resume of and chat with a certain number of job seekers in its platform during the subscription period; and (ii) services with definite and limited number of usages within an expiration period, such as bulk invite sending and advanced filter. Accordingly, the Group recognizes its revenues from online recruitment services either over time or at a point in time as following: ● For services over a particular subscription period, the Group has a stand-ready obligation to deliver the corresponding services on a when-and-if-available basis during the subscription period, and enterprise customers simultaneously and continuously receive and consume the benefits as the Group provides the services throughout the subscription period. Therefore, a time-based measure of progress best reflects the satisfaction of the performance obligations and the Group recognizes the related revenues on a straight-line basis over the subscription period. ● For services with definite and limited number of usages within an expiration period, upon the delivery of the individual services, the Group satisfies its performance obligations and enterprise customers benefit from its performance obligations. Therefore, revenues are recognized at a point in time. If these services are unused within the expiration period, the Group recognizes the relevant revenues when they expire. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (o) Revenue recognition (continued) Other services Other services mainly represent paid value-added tools offered to job seekers such as increased exposure of resume and candidate competitive analysis. Arrangements with multiple performance obligations Multiple performance obligations exist when enterprise customers purchase subscription packages, which include an array of services. For those services included in subscription packages, the selling prices are consistently made references to the standalone selling prices when sold separately. The Group allocates the transaction price to each performance obligation based on the relative standalone selling price, considering bulk-sale price discounts offered to certain enterprise customers where applicable. Deferred revenue The Group records deferred revenue when the Group receives customers’ payments in advance of transferring control of services to customers. Substantially all deferred revenue recorded are expected to be recognized as revenues in the next twelve months. Remaining performance obligations Remaining performance obligations represent the amount of contracted future revenues not yet recognized as the amount relate to undelivered performance obligations. Substantially all of the Group’s contracts with customers are within one year in duration. As such, the Group has elected to apply the practical expedient which allows an entity to exclude disclosures about its remaining performance obligations if the performance obligation is part of a contract that has an original expected duration of one year or less. (p) Cost of revenues Cost of revenues primarily consist of third-party payment processing cost, payroll and other employee-related expenses, server and bandwidth service cost, server depreciation and other expenses, which are directly attributable to the performance of the Group’s online recruitment services. (q) Sales and marketing expenses Sales and marketing expenses primarily consist of advertising expenses, payroll and other employee-related expenses for the Group’s sales and marketing staff, as well as other expenses such as office rental and property management fees for sales functions. Advertising expenses primarily include online traffic acquisition and brand marketing cost. For the years ended December 31, 2020, 2021 and 2022, advertising expenses totaled RMB812,415, RMB997,650 and RMB793,211, respectively. (r) Research and development expenses Research and development expenses primarily consist of payroll and other employee-related expenses for the Group’s research and development staff and other expenses such as office rental and property management fees for research and development functions. All research and development costs are expensed as incurred. (s) General and administrative expenses General and administrative expenses primarily consist of payroll and other employee-related expenses for the Group’s managerial and administrative staff and other expenses such as office rental and property management fees. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (t) Employee benefits Full-time employees of the Group in the PRC participate in a government mandated defined contribution plan, pursuant to which certain pension benefits, medical care, employee housing fund and other welfare benefits are provided to employees. Chinese labor regulations require that the PRC subsidiaries, consolidated VIE and VIE’s subsidiaries of the Group make contributions to the government for these benefits based on certain percentages of the employees’ salaries, up to a maximum amount specified by the local government. The Group has no legal obligation for the benefits beyond the contributions made. Total amounts of such employee benefit expenses contributed by the Group, including accrued and unpaid amounts, were RMB135,478, RMB256,533 and RMB395,193 for the years ended December 31, 2020, 2021 and 2022, respectively. (u) Share-based compensation The Group grants share options and restricted share units (“RSUs”) to its management, eligible employees and non-employees. Such compensation is accounted for in accordance with ASC 718, Compensation-Stock Compensation Improvements to Non-employee Share-Based Payment Accounting Share-based awards with service conditions only are measured at the grant-date fair value of the awards and recognized as expenses using the straight-line method over the requisite service period. Share-based awards that are subject to both service conditions and the occurrence of an IPO or change of control as a performance condition, are measured at the grant-date fair value, and cumulative share-based compensation expenses for the awards that have satisfied the service condition were recorded upon the completion of the Company’s US IPO in June 2021. The fair value of share options is estimated using the binomial option-pricing model. The determination of the fair value is affected by the fair value of the ordinary shares as well as assumptions regarding a number of complex and subjective variables, including the expected share price volatility, actual and projected employee and non-employee share option exercise behavior, risk-free interest rates and expected dividend yield. Binomial option-pricing model incorporates the assumptions about grantees’ future exercise patterns. The fair value of these awards was determined by management with the assistance from an independent valuation firm using management’s estimates and assumptions. The fair value of the RSUs, which were granted subsequent to the completion of the Company’s US IPO, is estimated based on the fair value of the underlying ordinary shares of the Company on the grant date. The assumptions used in share-based compensation expense recognition represent management’s best estimates, but these estimates involve inherent uncertainties and application of management judgment. If factors change or different assumptions are used, the share-based compensation expenses could be materially different for any period. Moreover, the estimates of fair value of the awards are not intended to predict actual future events or the value that ultimately will be realized by grantees who receive share-based awards. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (v) Operating leases The Group accounts for operating leases in accordance with ASC 842, Leases For operating lease with a term of one year or less, the Group has elected to not recognize any right-of-use asset or lease liability on its consolidated balance sheets. Instead, it recognizes the lease payments as operating cost and expenses in the consolidated statements of comprehensive income/(loss) on a straight-line basis over the lease term. Short-term lease expenses are immaterial to the consolidated statements of comprehensive income/(loss). (w) Income tax Current income taxes are recorded in accordance with the regulations of the relevant tax jurisdiction. The Group accounts for deferred income taxes under the liability method in accordance with ASC 740, Income Tax The Group recognizes the benefit of a tax position if the tax position is more-likely-than-not to prevail based on the facts and technical merits of the position. Tax positions that meet the more-likely-than-not recognition threshold is then measured at the largest amount of tax benefit that has a greater than fifty percent likelihood of being realized upon settlement. The Group estimates its liability for unrecognized tax benefits which are periodically assessed and may be affected by changing interpretations of laws, rulings by tax authorities, changes and/or developments with respect to tax audits, and expiration of the statute of limitations. The ultimate outcome for a particular tax position may not be determined with certainty prior to the conclusion of a tax audit and, in some cases, appeal or litigation process. The actual benefits ultimately realized may differ from the Group’s estimates and any adjustments are recorded in the Group’s consolidated financial statements in the period in which the audit is concluded. Additionally, changes in facts, circumstances and new information may require the Group to adjust the recognition and measurement estimates with regard to individual tax positions and such changes are recognized in the period in which the changes occur. As of December 31, 2022, the Group did not have any significant unrecognized uncertain tax positions. (x) Comprehensive income/(loss) Comprehensive income/(loss) is defined as the change in equity of a company during a period from transactions and other events and circumstances excluding those resulting from investments by shareholders and distributions to shareholders. The Group recognizes foreign currency translation adjustments as other comprehensive income/(loss) in the consolidated financial statements. As such adjustments do not incur income tax obligations, there are no tax adjustments to arrive at other comprehensive income/(loss) on a net-of-tax basis. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) (y) Segment reporting In accordance with ASC 280, Segment Reporting (z) Net income/(loss) per share Basic net income/(loss) per share is computed by dividing net income/(loss) attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted net income/(loss) per share is calculated by dividing net income/(loss) attributable to ordinary shareholders by the weighted average number of ordinary shares and, if dilutive, potential ordinary shares outstanding during the period. Potential ordinary shares consist of shares issuable upon the conversion of the preferred shares using the if-converted method, for periods prior to the completion of the Company’ US IPO in June 2021, unvested RSUs and shares issuable upon the exercise of share options using the treasury stock method. The two-class method is used for computing net income per share in the event the Group has net income available for distribution. Under the two-class method, net income is allocated between ordinary shares and other participating securities based on their participating rights, if applicable. Prior to the completion of the Company’ US IPO in June 2021, the computation of basic net loss per share using the two-class method was not applicable as the Group was in a net loss position and the participating securities did not have contractual obligations to share in the loss of the Group. (aa) Recent accounting pronouncements Recently adopted accounting pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments Credit Losses Recent accounting pronouncements not yet adopted In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers |
CONCENTRATION AND RISKS
CONCENTRATION AND RISKS | 12 Months Ended |
Dec. 31, 2022 | |
CONCENTRATION AND RISKS | |
CONCENTRATION AND RISKS | 3. (a) Concentration of credit risk Financial instruments that potentially expose the Group to the concentration of credit risk primarily consist of cash and cash equivalents and short-term investments. The maximum exposure of such assets to credit risk is their carrying amounts as of the balance sheet dates. The Group places its cash and cash equivalents and short-term investments with financial institutions which the Group believes are of high-credit rating and quality. In the event of bankruptcy of these financial institutions, the Group may not be able to claim its cash and cash equivalents and short-term investments back in full. The Group regularly monitors the rating and financial strength of these financial institutions to avoid potential defaults. (b) Foreign currency exchange rate risk Since June 2010, the RMB has fluctuated against the US$, at times significantly and unpredictably. The appreciation of the RMB against the US$ was approximately 6.5% and 2.3% in 2020 and 2021, respectively. The depreciation of the RMB against the US$ was approximately 9.2% in 2022. It is difficult to predict how market forces or PRC or U.S. government policy may impact the exchange rate between the RMB and the US$ in the future. |
SHORT-TERM INVESTMENTS
SHORT-TERM INVESTMENTS | 12 Months Ended |
Dec. 31, 2022 | |
SHORT-TERM INVESTMENTS | |
SHORT-TERM INVESTMENTS | 4. As of December 31, 2021 2022 RMB RMB Wealth management products 884,996 2,665,047 Deposits — 793,042 Total 884,996 3,458,089 Investment income from short-term investments was RMB9,095, RMB24,744 and RMB65,150 for the years ended December 31, 2020, 2021 and 2022, respectively. |
PREPAYMENTS AND OTHER CURRENT A
PREPAYMENTS AND OTHER CURRENT ASSETS | 12 Months Ended |
Dec. 31, 2022 | |
PREPAYMENTS AND OTHER CURRENT ASSETS | |
PREPAYMENTS AND OTHER CURRENT ASSETS | 5. As of December 31, 2021 2022 RMB RMB Prepaid advertising expenses and service fee 234,490 211,604 Receivables related to the exercise of share-based awards* 289,822 172,452 Deposits 63,814 68,390 Staff loans and advances 52,695 33,672 Receivables from third-party online payment platforms 63,866 30,317 Others 19,896 84,338 Total 724,583 600,773 * It mainly represented receivables from a third-party share option brokerage platform for the exercise of share-based awards due to the timing of settlement. |
PROPERTY, EQUIPMENT AND SOFTWAR
PROPERTY, EQUIPMENT AND SOFTWARE, NET | 12 Months Ended |
Dec. 31, 2022 | |
PROPERTY, EQUIPMENT AND SOFTWARE, NET | |
PROPERTY, EQUIPMENT AND SOFTWARE, NET | 6. PROPERTY, EQUIPMENT AND SOFTWARE, NET As of December 31, 2021 2022 RMB RMB Electronic equipment 429,683 849,020 Leasehold improvement 65,885 95,554 Furniture and fixtures 12,784 18,514 Motor vehicles 3,904 5,272 Software 3,126 4,055 Total cost 515,382 972,415 Less: accumulated depreciation (146,256) (281,379) Total property, equipment and software, net 369,126 691,036 Depreciation expenses were RMB41,004, RMB80,009 and RMB139,470 for the years ended December 31, 2020, 2021 and 2022, respectively. |
BUSINESS ACQUISITION
BUSINESS ACQUISITION | 12 Months Ended |
Dec. 31, 2022 | |
BUSINESS ACQUISITION | |
BUSINESS ACQUISITION | 7. On October 11, 2022, the Group completed the acquisition of 100% equity interest of Beijing Qihui Ruituo Consulting Co., Ltd. (“Beijing Qihui”), which focuses on providing executive search services for mid-level to senior management and professional technical personnel to employers in the internet industry. The consideration of this acquisition was RMB10.0 million in cash. Additionally, there was a contingent payment arrangement, which was mainly subject to continued employments of the founder of Beijing Qihui and certain key employees and certain performance conditions. The contingent payment arrangement was accounted for as post-combination compensation expenses during the requisite service periods when it is probable that the performance conditions will be met. The acquisition was accounted for as a business acquisition using the purchase method of accounting. The consideration of the acquisition was allocated based on the fair value of the assets acquired and the liabilities assumed as of the acquisition date as follows: Amount RMB Purchase consideration 10,000 Identifiable intangible assets acquired —Non-compete agreements 8,400 —Trademarks 1,000 —Database 1,000 Goodwill 5,690 Deferred tax liabilities (2,080) Net liabilities assumed (4,010) Total 10,000 Goodwill was primarily attributable to the benefit of the synergies and future business growth expected to be achieved from the acquisition. Goodwill was expected to be non-deductible for income tax purposes. Pro forma results of operations for this acquisition were not presented because the effect of this acquisition was not material to the Group’s consolidated financial statements for the year ended December 31, 2022. |
ACCOUNTS PAYABLE
ACCOUNTS PAYABLE | 12 Months Ended |
Dec. 31, 2022 | |
ACCOUNTS PAYABLE | |
ACCOUNTS PAYABLE | 8. As of December 31, 2021 2022 RMB RMB Payables for purchase of property, equipment and software 19,987 142,142 Payables for advertising expenses 30,646 32,277 Others 2,330 10,878 Total 52,963 185,297 |
OTHER PAYABLES AND ACCRUED LIAB
OTHER PAYABLES AND ACCRUED LIABILITIES | 12 Months Ended |
Dec. 31, 2022 | |
OTHER PAYABLES AND ACCRUED LIABILITIES | |
OTHER PAYABLES AND ACCRUED LIABILITIES | 9. OTHER PAYABLES AND ACCRUED LIABILITIES As of December 31, 2021 2022 RMB RMB Salary, welfare and bonus payable 373,286 366,454 Tax payable (1) 218,419 152,598 Advance from customers (2) 41,070 58,630 Others 12,363 55,800 Total 645,138 633,482 (1) Tax payable mainly included value-added tax, enterprise income tax and individual income tax payable mainly related to the exercise of share-based awards. (2) It represents advance payments from customers stored in their own accounts in the Group’s platform, which are refundable and could be used to exchange for the Group’s services. |
REVENUES
REVENUES | 12 Months Ended |
Dec. 31, 2022 | |
REVENUES | |
REVENUES | 10. REVENUES The Group defines enterprise customers who contributed revenues of RMB50 or more annually as key accounts, who contributed revenues between RMB5 and RMB50 annually as mid-sized accounts, and who contributed revenues of RMB5 or less annually as small-sized accounts. Revenues by source consist of the following: For the year ended December 31, 2020 2021 2022 RMB RMB RMB Online recruitment services to enterprise customers 1,927,178 4,219,026 4,461,282 —Key accounts 330,795 928,360 1,033,561 —Mid-sized accounts 696,325 1,513,506 1,774,855 —Small-sized accounts 900,058 1,777,160 1,652,866 Others 17,181 40,102 49,780 Total 1,944,359 4,259,128 4,511,062 For revenues from online recruitment services to enterprise customers, RMB1,527,671, RMB3,043,692 and RMB3,331,046 were recognized over time for the years ended December 31, 2020, 2021 and 2022, respectively; and RMB399,507, RMB1,175,334 and RMB1,130,236 were recognized at a point in time for the years ended December 31, 2020, 2021 and 2022, respectively. |
OPERATING LEASE
OPERATING LEASE | 12 Months Ended |
Dec. 31, 2022 | |
OPERATING LEASE | |
OPERATING LEASE | 11. OPERATING LEASE The Group’s operating leases are primarily for offices. The components of lease expenses are as follows: For the year ended December 31, 2020 2021 2022 RMB RMB RMB Operating lease expenses 71,706 116,091 162,448 Short-term lease expenses 2,167 2,177 1,947 Total 73,873 118,268 164,395 Supplemental balance sheet information related to operating leases is as follows: As of December 31, 2021 2022 RMB RMB Right-of-use assets, net 309,085 289,628 Operating lease liabilities, current 127,531 151,438 Operating lease liabilities, non-current 183,365 143,591 Total operating lease liabilities 310,896 295,029 As of December 31, 2021 2022 RMB RMB Weighted average remaining lease term (in years) 3.26 2.60 Weighted average discount rate 4.82% 4.81% Supplemental cash flow information related to operating leases is as follows: For the year ended December 31, 2020 2021 2022 RMB RMB RMB Cash paid for amounts included in the measurement of operating lease liabilities 72,138 102,154 154,626 Right-of-use assets obtained in exchange for operating lease liabilities 112,871 274,358 139,968 Maturities of operating lease liabilities are as follows: As of December 31, 2022 RMB 2023 154,865 2024 82,310 2025 49,935 2026 25,451 2027 1,833 Thereafter — Total undiscounted lease payments 314,394 Less: imputed interest (19,365) Total operating lease liabilities 295,029 |
INCOME TAX
INCOME TAX | 12 Months Ended |
Dec. 31, 2022 | |
INCOME TAX | |
INCOME TAX | 12. INCOME TAX Cayman Islands The Company was incorporated in the Cayman Islands. Under the current laws of the Cayman Islands, the Company is not subject to tax on income or capital gain. Additionally, no Cayman Islands withholding tax will be imposed upon payments of dividends to shareholders. Hong Kong Under the current Hong Kong Inland Revenue Ordinance, the Group’s subsidiary in Hong Kong is subject to 16.5% Hong Kong profit tax on its taxable income generated from operations in Hong Kong. Additionally, payments of dividends by the subsidiary incorporated in Hong Kong to the Company are not subject to any Hong Kong withholding tax. China Under the PRC Enterprise Income Tax Law (the “EIT Law”), domestic enterprises and foreign investment enterprises are subject to a uniform enterprise income tax rate of 25%. In accordance with the implementation rules of the EIT Law, a qualified “High and New Technology Enterprise” (“HNTE”) is eligible for a preferential tax rate of 15%. The HNTE certificate is effective for a period of three years and could be re-applied when the prior certificate expires. Huapin is qualified as a HNTE and enjoys a preferential income tax rate of 15% for the years presented. According to relevant laws and regulations promulgated by the State Taxation Administration of the PRC effective from 2018 onwards, enterprises engaging in research and development activities are entitled to claim 175% of their qualified research and development expenses incurred as tax deductible expenses when determining their assessable profits for the year, which is subject to the approval from the relevant tax authorities. Pursuant to the announcement issued by the State Taxation Administration of the PRC and other government authorities in September 2022, enterprises engaging in research and development activities are entitled to claim 200% of qualified research and development expenses for the period from October 1, 2022 to December 31, 2022 as tax deductible expenses. Additionally, HNTEs are entitled to claim 200% of the purchase of equipment and appliances made during the period from October 1, 2022 to December 31, 2022 as tax deductible items when determining the assessable profit for the year ended December 31, 2022. Components of (loss)/income before income tax are as follows: For the year ended December 31, 2020 2021 2022 RMB RMB RMB (Loss)/Income from PRC entities (311,483) 610,813 125,529 Loss from overseas entities (630,412) (1,622,360) (8,533) Total (941,895) (1,011,547) 116,996 Components of income tax expenses are as follows: For the year ended December 31, 2020 2021 2022 RMB RMB RMB Current income tax expenses — 59,527 427 Deferred income tax expenses — — 9,324 Total — 59,527 9,751 12. INCOME TAX (CONTINUED) The following table sets forth a reconciliation between the PRC statutory income tax rate of 25% and the Group’s effective tax rate: For the year ended December 31, 2020 2021 2022 RMB RMB RMB PRC statutory income tax rate 25.00 % 25.00 % 25.00 % Effect of tax-exempt entities and tax rates in different jurisdictions (15.82) % (37.89) % (21.95) % Effect of preferential tax rates (3.36) % 5.15 % (10.43) % Effect of permanent difference* 2.22 % 1.24 % (11.00) % Changes in valuation allowance (7.89) % (8.38) % 16.63 % Others (0.15) % 9.00 % 10.08 % Effective tax rate — (5.88) % 8.33 % * The effect of permanent difference for the year ended December 31, 2022 was primarily related to additional tax deductions for qualified research and development expenses and newly purchased equipment, partially offset by non-deductible share-based compensation expenses. The following table sets forth the significant components of deferred tax assets and liabilities: As of December 31, 2021 2022 RMB RMB Deferred tax assets Deductible advertising expenses 262,801 272,810 Net operating loss carry-forwards 70,985 94,704 Others 1,062 58 Total deferred tax assets 334,848 367,572 Less: valuation allowance (334,848) (354,306) Total deferred tax assets, net of valuation allowance — 13,266 Deferred tax liabilities Accelerated tax depreciation — (22,693) Identifiable intangible assets arising from business acquisition — (1,977) Total deferred tax liabilities — (24,670) Deferred tax liabilities, net of deferred tax assets — (11,404) As of December 31, 2022, the Group had accumulated tax losses of approximately RMB407.8 million, mainly derived from certain entities incorporated in the PRC and overseas. The tax losses in PRC can be carried forward for five years to offset future taxable profit, and the period is extended to 10 years for entities qualified as HNTEs. The tax losses in Hong Kong can be carried forward with no expiration date. Under the U.S. tax law, majority of the Group’s federal tax losses arose in tax years beginning after December 31, 2017 and can be carried forward indefinitely; and California state tax losses can be carried forward for up to 20 years. Valuation allowance is provided against deferred tax assets based on a more-likely-than-not threshold. In making such determination, the Group evaluates a variety of factors including future reversals of existing taxable temporary differences and future profitability. Deferred tax assets that arose from deductible advertising expenses were provided for full valuation allowance, because there was no positive evidence to conclude that the benefit of such deferred tax assets would be more-likely-than-not to be realized based on the historical level of advertising expenditures. As of December 31, 2022, deferred tax assets of RMB13,266 that mainly arose from net operating loss carry-forwards of the VIE were expected to be utilized prior to expiration, while the remaining deferred tax assets mainly arising from net operating loss carry-forwards of other consolidated entities were provided for full valuation allowance because they were expected to continue to be loss-making in the foreseeable future. 12. INCOME TAX (CONTINUED) Movements of valuation allowance are as follows: For the year ended December 31, 2020 2021 2022 RMB RMB RMB Balance at beginning of the year 175,757 250,032 334,848 Change of valuation allowance 74,275 84,816 19,458 Balance at end of the year 250,032 334,848 354,306 |
ORDINARY SHARES
ORDINARY SHARES | 12 Months Ended |
Dec. 31, 2022 | |
ORDINARY SHARES | |
ORDINARY SHARES | 13. On February 10, 2020, all of the issued and outstanding 100,080,000 ordinary shares of the Company were re-designated as Class B ordinary shares, which were held by TECHWOLF LIMITED. TECHWOLF LIMITED was controlled by Mr. Peng Zhao, Founder, Chairman and CEO of the Group, and therefore Mr. Peng Zhao was deemed to beneficially own all of the Company’s issued Class B ordinary shares. On August 21, 2020, the Company issued a total of 4,122,853 Class A ordinary shares to Coatue PE Asia 26 LLC with a total consideration of US$11,431. Meanwhile, TECHWOLF LIMITED sold a total of 3,752,934 Class B ordinary shares to Image Frame Investment (HK) Limited, and immediately after the completion of the transfer, the Company re-designated these shares into Class A ordinary shares. On September 19, 2020, the Company issued 3,657,853 Class A ordinary shares to TWL Fellows Holding Limited for nominal consideration. TWL Fellows Holding Limited, a consolidated VIE of the Company incorporated on January 14, 2020 in the British Virgin Islands, was established as an employee shareholding vehicle (a “Trust”) for the purpose of implementing the Company’s share award plan. Therefore, the Company’s ordinary shares issued to TWL Fellows Holding Limited were presented as treasury shares in the consolidated financial statements. Other than holding the Company’s ordinary shares, the Trust does not have any assets. On November 27, 2020, the Company issued and granted 24,780,971 Class B ordinary shares to TECHWOLF LIMITED (Note 15). On March 12, 2021, TECHWOLF LIMITED transferred a total of 1,965,361 and 1,876,467 Class B ordinary shares to two new external investors, respectively, and those shares were automatically converted into Class A ordinary shares upon the closing of share transfer between the shareholders. In March 2021, the Company repurchased a total of 1,181,339 Class B ordinary shares from TECHWOLF LIMITED at a price of US$5.33 per share. Immediately after the repurchase, those Class B ordinary shares were cancelled. The difference between the purchase price and the fair value of Class B ordinary shares was recorded as additional paid-in capital in the consolidated financial statements. In June 2021, the Company completed its US IPO and 110,400,000 Class A ordinary shares were issued with total net proceeds of RMB6,406,872. Upon the completion of the US IPO, all of the preferred shares were automatically converted to 551,352,134 Class A ordinary shares. In June 2021, the Company issued and granted 24,745,531 Class B ordinary shares to TECHWOLF LIMITED (Note 15). In March 2022, the Company’s board of directors authorized a share repurchase program under which the Company may repurchase up to US$150 million of its American depositary shares (“ADSs”) over the following 12 months. Under this share repurchase program, during the year ended December 31, 2022, the Company repurchased a total of 8,822,549 ADSs (representing a total of 17,645,098 Class A ordinary shares) for approximately US$131.2 million (RMB918.9 million) on the open market. The repurchased ordinary shares were accounted for using the cost method and recorded as treasury shares as a component of the shareholders’ equity. 13. ORDINARY SHARES (CONTINUED) In December 2022, the Company successfully listed, by way of introduction, its Class A ordinary shares on the Main Board of The Stock Exchange of Hong Kong Limited (the “HK Listing”). As of December 31, 2022, 749,323,103 Class A ordinary shares were issued, out of which 724,582,975 outstanding, and 140,830,401 Class B ordinary shares were issued and outstanding. Each Class A ordinary share is entitled to one vote, and each Class B ordinary share is entitled to ten votes on resolutions except for that with respect to certain reserved matters. |
CONVERTIBLE REDEEMABLE PREFERRE
CONVERTIBLE REDEEMABLE PREFERRED SHARES | 12 Months Ended |
Dec. 31, 2022 | |
CONVERTIBLE REDEEMABLE PREFERRED SHARES | |
CONVERTIBLE REDEEMABLE PREFERRED SHARES | 14. On May 20, 2014, the Company entered into a shares purchase agreement with certain investors, pursuant to which 60,000,000 Series A convertible redeemable preferred shares (the “Series A Preferred Shares”) were issued on May 20, 2014 for an aggregated consideration of US$3,000. The Company incurred issuance cost of US$20 in connection with this offering. On December 16, 2014, the Company entered into a shares purchase agreement with certain investors, pursuant to which 26,666,667 Series B convertible redeemable preferred shares (the “Series B Preferred Shares”) were issued on December 16, 2014 for an aggregated consideration of US$4,000. The Company incurred issuance cost of US$41 in connection with the offering of Series B Preferred Shares. Besides, the Company also issued 13,333,333 Series B Preferred Shares to TECHWOLF LIMITED, controlled by Mr. Peng Zhao, the Company’s Founder, Chairman and CEO, with no consideration received. Then the Company repurchased all of the Series B Preferred Shares issued to TECHWOLF LIMITED at par value and sold them to one of previous Series B investor on April 8, 2015 at the original issue price of the Series B Preferred Shares. On April 8, 2015, the Company entered into a shares purchase agreement with certain investors, pursuant to which 48,000,000 Series C convertible redeemable preferred shares (the “Series C Preferred Shares”) were issued on April 8, 2015 for an aggregated consideration of US$10,000. The Company incurred issuance cost of US$40 in connection with this offering. On July 7, 2016, the Company entered into a shares purchase agreement with certain investors, pursuant to which 45,319,316 Series C-1 convertible redeemable preferred shares (the “Series C Preferred Shares”, “Series C-1 Preferred Shares” or “Series C Preferred Shares Tranche I”) were issued on July 7, 2016 for an aggregated consideration of US$12,508. The Company incurred issuance cost of US$86 in connection with this offering of Series C-1 Preferred Shares. On August 15, 2016, the Company entered into a shares purchase agreement with certain investors, pursuant to which 42,251,744 Series C-2 convertible redeemable preferred shares (the “Series C Preferred Shares”, “Series C-2 Preferred Shares” or “Series C Preferred Shares Tranche II”) were issued on August 15, 2016 for an aggregated consideration of US$18,000. The Company incurred issuance cost of US$100 in connection with this offering. On February 10, 2017, the Company entered into a shares purchase agreement with certain investors, pursuant to which 11,497,073 Series C-3 convertible redeemable preferred shares (the “Series C Preferred Shares”, “Series C-3 Preferred Shares” or “Series C Preferred Shares Tranche III”) were issued on February 10, 2017 for an aggregated consideration of US$6,001. The Company incurred issuance cost of US$32 in connection with this offering. On November 2, 2017, the Company entered into a shares purchase agreement with certain investors, pursuant to which 60,856,049 Series D convertible redeemable preferred shares (the “Series D Preferred Shares”) were issued on November 2, 2017 for an aggregated consideration of US$43,394. The Company incurred issuance cost of US$1,132 in connection with this offering. 14. CONVERTIBLE REDEEMABLE PREFERRED SHARES (CONTINUED) On December 18, 2018, the Company entered into a shares purchase agreement with certain investors, pursuant to which 83,474,263 Series E convertible redeemable preferred shares (the “Series E Preferred Shares”) were issued on December 18, 2018 for an aggregated consideration of US$130,000. The Company incurred issuance cost of US$3,376 in connection with this offering. On March 8, 2019, the Company entered into a shares purchase agreement with certain investors, pursuant to which 32,373,031 Series E+ convertible redeemable preferred shares (the “Series E Preferred Shares”, “Series E-1 Preferred Shares” or “Series E Preferred Shares Tranche I”) were issued on March 8, 2019 for an aggregated consideration of US$55,000. The Company incurred issuance cost of US$1,982 in connection with this offering. On July 4, 2019, the Company entered into a shares purchase agreement with certain investors, pursuant to which 28,226,073 Series E-2 convertible redeemable preferred shares (the “Series E Preferred Shares”, “Series E-2 Preferred Shares” or “Series E Preferred Shares Tranche II”) were issued on July 4, 2019 for an aggregated consideration of US$50,000. The Company incurred issuance cost of US$1,917 in connection with this offering. On February 10, 2020, the Company entered into a shares purchase agreement with certain investors, pursuant to which 48,689,976 Series F convertible redeemable preferred shares (the “Series F Preferred Shares”) were issued on February 10, 2020 for an aggregated consideration of US$150,000. The Company incurred issuance cost of US$1 in connection with this offering. On November 27, 2020, the Company entered into a shares purchase agreement with certain investors, pursuant to which 50,664,609 Series F+ convertible redeemable preferred shares (the “Series F Preferred Shares” or “Series F-plus Preferred Shares”) were issued on November 27, 2020 for an aggregated consideration of US$270,000. The Company incurred issuance cost of US$3,080 in connection with this offering. The Series A, B, C, D, E and F Preferred Shares are collectively referred to as the Preferred Shares. The holders of Preferred Shares are collectively referred to as the Preferred Shareholders. The key terms of the Preferred Shares issued by the Company are as follows: Conversion rights Optional conversion Each Series A, B, C, D, E and F Preferred Share shall be convertible, at the option of the holder thereof, at any time and without the payment of additional consideration by the holder thereof, into such number of Class A ordinary shares as determined by the quotient of the applicable issue price divided by the then effective applicable conversion price with respect to such particular series of Preferred Shares, which shall initially be the applicable issue price for the Series A, B, C, D, E and F Preferred Shares, as the case may be, resulting in an initial conversion ratio for the Preferred Shares of 1:1, and shall be subject to adjustment and readjustment from time to time, including but not limited to additional equity securities issuances, share dividends, distributions, subdivisions, redemptions, combinations, or reorganizations, mergers, consolidations, reclassifications, exchanges or substitutions. Automatic conversion Each Preferred Share is convertible, at the option of the holder, at any time after the date of issuance of such Preferred Shares according to a conversion ratio, subject to adjustments for dilution, including but not limited to stock splits, stock dividends and capitalization and certain other events. Each Preferred Share is convertible into a number of ordinary shares determined by dividing the applicable original issue price by the conversion price (initially being 1 to 1 conversion ratio). The conversion price of each Preferred Share is the same as its original issue price and no adjustments to conversion price have occurred so far. 14. CONVERTIBLE REDEEMABLE PREFERRED SHARES (CONTINUED) Each Series A, B, C, D, E and F Preferred Share shall automatically be converted into Class A ordinary shares, at the then applicable preferred share conversion price upon (i) closing of a Qualified Initial Public Offering (“Qualified IPO”), or (ii) the written approval of the holders of a majority of each series of Preferred Shares (calculated and voting separately in their respective single class on an as-converted basis). Prior to the Series D Preferred Shares issuance on November 2, 2017, a “Qualified IPO” was defined as an initial public offering with gross proceeds no less than US$60 million and capitalization of the Company of no less than US$350 million prior to such initial public offering. Upon the issuance of Series D Preferred Shares, the gross proceeds and market capitalization criteria for a “Qualified IPO” were increased to US$90 million and US$900 million, respectively. Upon the issuance of Series E Preferred Shares, the gross proceeds and market capitalization criteria for a “Qualified IPO” were increased to US$100 million and US$2,000 million, respectively. Upon the issuance of Series F Preferred Shares, the gross proceeds and market capitalization criteria for a “Qualified IPO” were increased to US$100 million and US$3,300 million, respectively. Upon the issuance of Series F-plus Preferred Shares, the gross proceeds and market capitalization criteria for a “Qualified IPO” were increased to US$300 million and US$5,000 million, respectively. Voting rights Each holder of Series A, B, C, D, E and F Preferred Shares is entitled to cast the number of votes equal to the number of Class A ordinary shares such Preferred Shares would be entitled to convert into at the then effective conversion price. There was a modification to the voting rights of the shares controlled by Mr. Peng Zhao when the Series F and Series F-plus Preferred Shares were issued as follows: ● the voting rights of ordinary shares controlled by Mr. Peng Zhao was modified to carry 10 votes in connection with the Series F Preferred Shares financing; and ● the voting rights of shares controlled by Mr. Peng Zhao was modified to carry 15 votes in connection with the Series F-plus Preferred Shares financing. Dividend rights Each Preferred Share shall have the right to receive dividends, on an as-converted basis, when, as and if declared by the Board. No dividend shall be paid on the ordinary shares at any time unless and until all dividends on the Preferred Shares have been paid in full. No dividends on preferred and ordinary shares have been declared since the issuance date. Liquidation preference In the event of any liquidation (unless waived by the majority of Preferred Shareholders) including deemed liquidation, dissolution or winding up of the Company, Preferred Shareholders shall be entitled to receive a per share amount equal to 100% of the original preferred share issue price of the respective series of Preferred Shares, as adjusted for share dividends, share splits, combinations, recapitalizations or similar events, plus all accrued and declared but unpaid dividends thereon, in the sequence of Series F Preferred Shares, Series E Preferred Shares, Series D Preferred Shares, Series C Preferred Shares, Series B Preferred Shares, and Series A Preferred Shares. After such liquidation amounts have been paid in full, any remaining funds or assets of the Company legally available for distribution to shareholders shall be distributed on a pro rata, pari passu basis among the holders of the Preferred Shares, on an as-converted basis, together with the holders of the ordinary shares. 14. CONVERTIBLE REDEEMABLE PREFERRED SHARES (CONTINUED) Redemption rights At any time commencing on a date specified in the shareholders’ agreements (the “Redemption Start Date”), holders of majority (more than 50%) of the then outstanding Series A, B, C, D, E and F Preferred Shares may request a redemption of the Preferred Shares of such series. On receipt of a redemption request from the holders, the Company shall redeem all or part, as requested, of the outstanding Preferred Shares of such series. The Redemption Start Date of Preferred Shares have been amended for a number of times historically. If any holder of any series of Preferred Shares exercises its redemption right, any holder of other series of Preferred Shares shall have the right to exercise the redemption of its series at the same time. The redemption prices have been modified historically. Prior to the issuance of Series F Preferred Shares, the price at which each Preferred Share shall be redeemed shall equal to the original Preferred Shares issue price for such series plus 10% compound interest per annum (calculated from the issuance date of the respective series of Preferred Shares), and declared but unpaid dividends. Upon the issuance of Series F Preferred Shares, the price at which each Preferred Share shall be redeemed shall equal to the original Preferred Shares issue price for such series plus 8% simple interest per annum (calculated from the issuance dates of the respective series of Preferred Shares), and declared but unpaid dividends. If on the redemption date triggered by the occurrence of any redemption event, the Company’s assets or funds which are legally available are insufficient to pay in full the aggregate redemption price for Preferred Shares requested to be redeemed, upon the request of a redeeming shareholder, the Company shall execute and deliver a two-year note, bearing an interest of ten percent (10%) per annum and with repayment of the principal and interest to be made on a monthly basis over a period of twenty-four (24) months. Preferred Shares subject to redemption with respect to which the Company has become obligated to pay the redemption price but which it has not paid in full shall continue to have all the rights and privileges which such Preferred Shareholders had prior to such date, until the redemption price has been paid in full with respect to such Preferred Shares. Conversion upon US IPO In June 2021, upon the completion of the US IPO, all of the Preferred Shares were automatically converted to 551,352,134 Class A ordinary shares on a one-for-one basis. Accounting for preferred shares The Company classified the Preferred Shares in the mezzanine equity section of the consolidated balance sheets because they were redeemable at the holders’ option any time after a certain date and were contingently redeemable upon the occurrence of certain liquidation event outside of the Company’s control. The Preferred Shares are recorded initially at fair value, net of issuance cost. The Company records accretion on the Preferred Shares, where applicable, to the redemption value from the issuance dates to the earliest redemption dates. The accretion, calculated using the effective interest method, is recorded against retained earnings, or in the absence of retained earnings, by charging against additional paid-in capital. Once additional paid-in capital has been exhausted, additional charges are recorded by increasing the accumulated deficit. The accretion of Preferred Shares was RMB283,981 (US$41,546) and RMB164,065 (US$25,284) for the years ended December 31, 2020 and 2021. 14. CONVERTIBLE REDEEMABLE PREFERRED SHARES (CONTINUED) The Company has determined that, under the whole instrument approach, host contract of the Preferred Shares is more akin to a debt host, given the Preferred Shares holders have potential creditors’ right in the event of insufficient fund upon redemption, along with other debt-like features in the terms of the Preferred Shares, including the redemption rights. However, the Company determined that the embedded feature, including conversion feature, do not require bifurcation as they either are clearly and closely related to the host or do not meet definition of a derivative. The Company has determined that there was no beneficial conversion feature attributable to all Preferred Shares because the initial effective conversion prices of these Preferred Shares were higher than the fair value of the Company’s ordinary shares determined by the Company with the assistance from an independent third-party appraiser. Modification of preferred shares The Company assesses whether an amendment to the terms of its convertible redeemable preferred shares is an extinguishment or a modification based on a qualitative evaluation of the amendment. If the amendment adds, removes, significantly changes to a substantive contractual term or to the nature of the overall instrument, the amendment results in an extinguishment of the preferred shares. The Company also assesses if the change in terms results in value transfer between Preferred Shareholders or between Preferred Shareholders and ordinary shareholders. When convertible redeemable preferred shares are extinguished, the difference between the fair value of the consideration transferred to the convertible redeemable Preferred Shareholders and the carrying amount of such preferred shares (net of issuance cost) is treated as a deemed dividend to the Preferred Shareholders. When convertible redeemable preferred shares are modified and such modification results in value transfer between Preferred Shareholders and ordinary shareholders, the change in fair value resulted from the amendment is treated as a deemed dividend to or from the Preferred Shareholders. Preferred shares modification were mainly included below: ● Starting from the issuance of Series C Preferred Shares, optional redemption date of each pre-existing Preferred Shares was modified and extended to the fifth anniversary of each newly issued series of Preferred Shares applicable closing date; and ● On February 10, 2020, the Redemption Start Date of Series A, B, C, D and E Preferred Shares was extended from July 5, 2024 to February 10, 2025 , which is to be in line with the optional redemption date of Series F Preferred Shares. In the meanwhile, redemption price interest rate was lowered from 10% compound interest per annum to 8% simple interest per annum commencing from Series F Preferred Shares original issuance date and ending on the date of redemption. From both quantitative and qualitative perspectives, the Company assessed the impact of these modifications and concluded that they represented a modification rather than extinguishment of pre-existing preferred shares, and the impact of the modification was immaterial. 14. CONVERTIBLE REDEEMABLE PREFERRED SHARES (CONTINUED) The Company’s convertible redeemable preferred shares activities for the years ended December 31, 2020 and 2021 are summarized below: Series A Series B Series C Series D Series E Series F Preferred Preferred Preferred Preferred Preferred Preferred Shares Shares Shares Shares Shares Shares Total Number Number Number Number Number Number Number of shares Amount of shares Amount of shares Amount of shares Amount of shares Amount of shares Amount of shares Amount RMB RMB RMB RMB RMB RMB RMB Balance as of January 1, 2020 60,000,000 33,434 40,000,000 62,785 147,068,133 443,367 60,856,049 352,586 144,073,367 1,711,329 — — 451,997,549 2,603,501 Issuance of Series F Preferred Shares, net of issuance cost — — — — — — — — — — 99,354,585 2,803,114 99,354,585 2,803,114 Accretion on convertible redeemable preferred shares to redemption value — 2,743 — 5,191 — 35,198 — 28,196 — 133,704 — 78,949 — 283,981 Balance as of December 31, 2020 60,000,000 36,177 40,000,000 67,976 147,068,133 478,565 60,856,049 380,782 144,073,367 1,845,033 99,354,585 2,882,063 551,352,134 5,690,596 Accretion on convertible redeemable preferred shares to redemption value — 1,057 — 2,006 — 13,580 — 10,823 — 51,072 — 85,527 — 164,065 Conversion of Preferred Shares to ordinary shares (60,000,000) (37,234) (40,000,000) (69,982) (147,068,133) (492,145) (60,856,049) (391,605) (144,073,367) (1,896,105) (99,354,585) (2,967,590) (551,352,134) (5,854,661) Balance as of December 31, 2021 — — — — — — — — — — — — — — |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2022 | |
SHARE-BASED COMPENSATION | |
SHARE-BASED COMPENSATION | 15. In 2020, the Group adopted the 2020 Share Incentive Plan, which allows the Group to grant share-based awards to directors, employees and consultants. Share-based awards granted under the 2020 Share Incentive Plan contain service conditions, which are mainly subject to one of the following vesting schedules: (i) 25% of the share options shall become vested on each anniversary of the vesting commencement date for 4 years thereafter; (ii) 50% of the share options shall become vested on each anniversary of the vesting commencement date for 2 years thereafter; and (iii) immediately vested upon grant. In addition to service conditions, certain share-based awards granted are subject to performance condition related to the occurrence of an IPO or change of control. And the Company determined not to grant any further share-based awards pursuant to the 2020 Share Incentive Plan after the HK Listing in December 2022. As of December 31, 2022, share-based awards granted under the 2020 Share Incentive Plan to purchase 89,174,144 Class A ordinary shares were outstanding. In December 2022, the Group adopted the Post-IPO Share Scheme, which allows the Group to grant share-based awards to directors, employees and officers. As of December 31, 2022, the maximum number of Class A ordinary shares that may be issued under the Post-IPO Share Scheme was 86,380,904, and no share-based awards have been granted pursuant to the Post-IPO Share Scheme. (a) Share options The following table sets forth the activities of share options for the years ended December 31, 2020, 2021 and 2022, respectively: Weighted Weighted Weighted average average Aggregate average grant– Number of exercise remaining intrinsic date share options price contractual life value fair value US$ In Years US$ US$ Outstanding as of January 1, 2020 86,221,721 0.76 7.22 65,994 0.27 Granted 26,509,592 2.42 Exercised (5,597,960) 1.00 Outstanding as of December 31, 2020 107,133,353 1.16 6.84 226,639 0.64 Granted 32,710,153 4.14 Exercised (54,385,484) 0.55 Forfeited (2,982,054) 1.98 Outstanding as of December 31, 2021 82,475,968 2.71 8.05 1,214,916 2.82 Granted* 8,424 0.00 Exercised (12,413,256) 1.59 Forfeited (1,709,938) 3.39 Outstanding as of December 31, 2022 68,361,198 2.90 7.23 498,336 2.99 Vested and expected to vest as of December 31, 2022 68,361,198 2.90 7.23 498,336 2.99 Exercisable as of December 31, 2022 32,268,060 2.08 6.51 261,387 1.69 * The exercise price and grant-date fair value of share options granted in 2022 was US$ 0.0001 and US$12.13, respectively. 15. The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the estimated fair value of the underlying ordinary share at each reporting date. As of December 31, 2022, there were US$115,900 of unrecognized compensation expenses related to share options, which are expected to be recognized over a weighted-average period of 2.24 years and may be adjusted for future forfeitures. The Company uses the binomial option-pricing model to determine the fair value of the share options as of the grant dates. Key assumptions (or ranges thereof) are set as below: For the year ended December 31, 2020 2021 Fair value of ordinary shares on the date of option grant (US$) 1.84-3.27 6.78-18.09 Risk-free interest rate (1) 0.82%-1.70% 1.6%-2.0% Expected term (in years) 10 10 Expected dividend yield (2) 0% 0% Expected volatility (3) 56.5%-59.0% 58.8%-59.8% Expected early exercise multiple 2.2x-2.8x 2.2x-2.8x (1) The risk-free interest rate of periods within the contractual life of the share option is based on the market yield of U.S. Treasury Strips with a maturity life equal to the expected term of share options. (2) The Company has no history or expectation of paying dividends on its ordinary shares. (3) Expected volatility is estimated based on the average of historical volatilities of the comparable companies in the same industry as at the valuation dates. (b) RSUs After the completion of the Company’s US IPO in June 2021, the Company started to grant RSUs to employees. The following table summarizes activities of the Company’s RSUs for the years ended December 31, 2021 and 2022: Weighted average Number of RSUs grant-date fair value US$ Outstanding as of January 1, 2021 — — Granted 3,521,118 Outstanding as of December 31, 2021 3,521,118 19.05 Granted 19,686,470 Vested (1,959,584) Forfeited (435,058) Outstanding as of December 31, 2022 20,812,946 11.23 As of December 31, 2022, there were US$214,322 of unrecognized compensation expenses related to RSUs, which are expected to be recognized over a weighted-average period of 3.5 years and may be adjusted for future forfeitures. 15. SHARE-BASED COMPENSATION (CONTINUED) (c) Share-based compensation expenses by function The following table sets forth the amounts of share-based compensation expenses included in each of the relevant financial statement line items: For the year ended December 31, 2020 2021 2022 RMB RMB RMB Cost of revenues 1,920 31,467 39,587 Sales and marketing expenses 21,473 73,733 170,366 Research and development expenses 30,883 137,820 284,323 General and administrative expenses* 602,960 1,680,626 197,928 Total 657,236 1,923,646 692,204 * In November 2020 and June 2021, the Company granted 24,780,971 and 24,745,531 Class B ordinary shares to TECHWOLF LIMITED, and recorded share-based compensation expenses of RMB533.1 million and RMB1,506.4 million, respectively, in general and administrative expenses upon the grant (Note 13). |
NET (LOSS)_INCOME PER SHARE
NET (LOSS)/INCOME PER SHARE | 12 Months Ended |
Dec. 31, 2022 | |
NET (LOSS)/INCOME PER SHARE | |
NET (LOSS)/INCOME PER SHARE | 16. NET (LOSS)/INCOME PER SHARE The computation of basic and diluted net (loss)/income per share for the years ended December 31, 2020, 2021 and 2022 is as follows: For the year ended December 31, 2020 2021 2022 RMB RMB RMB Numerator Net (loss)/income (941,895) (1,071,074) 107,245 Accretion on convertible redeemable preferred shares to redemption value (283,981) (164,065) — Net (loss)/income attributable to ordinary shareholders (1,225,876) (1,235,139) 107,245 Denominator Weighted average number of ordinary shares used in computing net (loss)/income per share, basic 111,172,986 529,343,027 868,941,151 Dilutive effect of share-based awards — — 43,200,840 Weighted average number of ordinary shares used in computing net (loss)/income per share, diluted 111,172,986 529,343,027 912,141,991 Net (loss)/income per share attributable to ordinary shareholders —Basic (11.03) (2.33) 0.12 —Diluted (11.03) (2.33) 0.12 As the Group incurred loss for the years ended December 31, 2020 and 2021, the ordinary shares equivalents, including preferred shares, shares options and RSUs granted, were anti-dilutive and excluded from the computation of diluted net loss per share. For the year ended December 31, 2022, the ordinary shares equivalents including share options and RSUs granted were dilutive and were included in the computation of diluted net income per share as above. The weighted average numbers of ordinary shares equivalents excluded from the computation of diluted net loss per share for the years ended December 31, 2020 and 2021 were as follows: For the year ended December 31, 2020 2021 Preferred shares 500,211,192 251,440,808 Share options and RSUs 60,853,313 78,376,179 |
RELATED PARTY BALANCES AND TRAN
RELATED PARTY BALANCES AND TRANSACTIONS | 12 Months Ended |
Dec. 31, 2022 | |
RELATED PARTY BALANCES AND TRANSACTIONS | |
RELATED PARTY BALANCES AND TRANSACTIONS | 17. The table below sets forth major related parties with which the Group had transactions during the years presented and their relationships with the Group: Name of related parties Relationship with the Group Mr. Peng Zhao and companies controlled by him Founder, Chairman and CEO of the Group and his controlled companies Image Frame Investment (HK) Limited (under the control of Tencent Holdings Limited ) Principal shareholder of the Group Individual executive officer Executive officer of the Group Details of major amounts due from related parties for the years presented are as follows: As of December 31, 2021 2022 RMB RMB Receivables from the online payment platform of Tencent Group* 4,284 3,177 Prepaid cloud service fee to Tencent Group* 2,331 2,537 Total 6,615 5,714 Details of major transactions with related parties for the years presented are as follows: For the year ended December 31, 2020 2021 2022 RMB RMB RMB Cloud services from Tencent Group* 6,109 18,119 26,256 Online payment clearing services from Tencent Group* 1,886 5,464 4,533 Total 7,995 23,583 30,789 * Tencent Group represents companies under the control of Tencent Holdings Limited, including Image Frame Investment (HK) Limited. The Group purchases cloud services and online payment clearing services from Tencent Group, which are trade in nature. Additionally, the balance of amounts due from Mr. Peng Zhao and companies controlled by him, amounting to RMB31,132 as of December 31, 2020, was settled through the repurchase of Class B ordinary shares from TECHWOLF LIMITED in March 2021 (Note 13); and the advance of RMB5,093 to an individual executive officer as of December 31, 2020 was settled in cash in March 2021. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2022 | |
FAIR VALUE MEASUREMENT | |
FAIR VALUE MEASUREMENTS | 18. Information about inputs into the fair value measurement of the Group’s assets that are measured or disclosed at fair value on a recurring basis in periods subsequent to their initial recognition is as follows: Fair value measurement at reporting date using Quoted prices in active Significant other Significant markets for identical assets observable inputs unobservable Description Fair value (Level 1) (Level 2) inputs (Level 3) RMB RMB RMB RMB Short-term investments As of December 31, 2021 884,996 — 884,996 — As of December 31, 2022 3,458,089 — 3,458,089 — When available, the Group uses quoted market prices to determine the fair value of an asset or liability. If quoted market prices are not available, the Group will measure fair value using valuation techniques that use, when possible, current market-based or independently sourced market parameters, such as interest rates and currency rates. For short-term investments, which consists of wealth management products and deposits, the Group refers to the quoted rate of return provided by financial institutions at the end of each reporting period, which is classified as Level 2 of fair value measurement. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2022 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 19. Commitments The Group engages third parties for promoting its brand image through various advertising channels. The amount of advertising commitments relates to the committed advertising services that have not been delivered and paid. As of December 31, 2022, future minimum advertising commitments under non-cancelable agreements were RMB28.0 million. Contingencies The Group and certain of its officers and directors have been named as defendants in a putative securities class action filed on July 12, 2021 in the U.S. District Court for the District of New Jersey. On March 4, 2022, plaintiff filed the Amended Complaint, purportedly brought on behalf of a class of persons who allegedly suffered damages as a result of their trading in the securities between June 11, 2021 and July 2, 2021, both inclusive. The action alleges that the Group made false and misleading statements regarding the business, operations and compliance policies in violation of the Sections 10(b) and 20(a) of the U.S. Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder. Briefing on the Group’s motion to dismiss was completed in July 2022. In September 2022, the parties reached a tentative agreement in principle to settle the case. On November 10, 2022, the Court granted preliminary approval of the parties’ settlement agreement, pursuant to which, without any admission or finding of any wrongdoing on the part of any of the Defendants, the parties agreed that, in consideration of the Company’s payment of US$2.25 million, all actual and potential claims and causes of action that have been or could have been alleged against the Company and the individual defendant (including the individuals mentioned above) are resolved and discharged and precluded from being raised again in any future action. The above settlement amount has been paid in December 2022. On April 5, 2023, after holding a fairness hearing, the Court granted final approval of the settlement and terminated the case. |
PROFIT APPROPRIATION AND RESTRI
PROFIT APPROPRIATION AND RESTRICTED NET ASSETS | 12 Months Ended |
Dec. 31, 2022 | |
PROFIT APPROPRIATION AND RESTRICTED NET ASSETS | |
PROFIT APPROPRIATION AND RESTRICTED NET ASSETS | 20. The Company’s subsidiaries, consolidated VIE and VIE’s subsidiaries established in the PRC are required to make appropriations to certain non-distributable reserve funds. In accordance with the laws applicable to the foreign investment enterprises established in the PRC, the Group’s subsidiaries registered as wholly owned foreign enterprises have to make appropriations from their after-tax profits as determined under the Generally Accepted Accounting Principles in the PRC (“PRC GAAP”) to reserve funds including general reserve fund, enterprise expansion fund and staff bonus and welfare fund on an annual basis. The appropriation to the general reserve fund must be at least 10% of the after-tax profits calculated in accordance with the PRC GAAP. Appropriation is not required if the general reserve fund has reached 50% of the registered capital of the company. Appropriations to the enterprise expansion fund and staff bonus and welfare fund are made at the respective company’s discretion. In addition, in accordance with the PRC Company Law, the Group’s consolidated VIE and VIE’s subsidiaries must make appropriations from their after-tax profits as determined under the PRC GAAP to non-distributable reserve funds including statutory surplus fund and discretionary surplus fund on an annual basis. The appropriation to the statutory surplus fund must be 10% of the after-tax profits as determined under the PRC GAAP. Appropriation is not required if the statutory surplus fund has reached 50% of the registered capital of the company. Appropriation to the discretionary surplus fund is made at the discretion of the respective company. The use of the general reserve fund, enterprise expansion fund, statutory surplus fund and discretionary surplus fund are restricted to the offsetting of losses or increasing of the registered capital of the respective company. The staff bonus and welfare fund is a liability in nature and is restricted to fund payments of special bonus to employees and for the collective welfare of employees. None of these reserves are allowed to be transferred to the Company in terms of cash dividends, loans or advances. As of December 31, 2022, no appropriation to any reserve funds was made. Accordingly, under these PRC laws and regulations, the Company’s subsidiaries, the consolidated VIE and VIE’s subsidiaries incorporated in PRC are restricted in their ability to transfer a portion of their net assets to the Company. Amounts restricted, including paid-in capital and any statutory reserve funds, totaled approximately RMB938.0 million, or 8.1% of the Group’s total consolidated net assets as of December 31, 2022. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2022 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | 21. In March 2023, the Company’s board of directors authorized a new share repurchase program under which the Company may repurchase up to US$150 million of its shares (including in the form of ADSs) over the following 12 months. The proposed repurchases may be made on the open market, in privately negotiated transactions, in block trades and/or through other legally permissible means, depending on market conditions and in accordance with applicable rules and regulations. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of presentation | (a) Basis of presentation The accompanying consolidated financial statements have been prepared in accordance with U.S. GAAP. Significant accounting policies followed by the Group in the preparation of its accompanying consolidated financial statements are summarized below. |
Basis of consolidation | (b) Basis of consolidation The consolidated financial statements include the financial statements of the Company, its subsidiaries, the consolidated VIE and VIE’s subsidiaries for which the Company is the ultimate primary beneficiary. A subsidiary is an entity in which the Company, directly or indirectly, controls more than one half of the voting power; or has the power to appoint or remove the majority of the members of the board of directors, to cast a majority of votes at the meeting of the board of directors or to govern the financial and operating policies under a statute or agreement among the shareholders or equity holders. The Company applies the guidance codified in ASC 810, Consolidations All transactions and balances between the Company, its subsidiaries, the consolidated VIE and VIE’s subsidiaries have been eliminated upon consolidation. |
Use of estimates | (c) Use of estimates The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the balance sheet dates and revenues and expenses during the reporting periods. Accounting estimates reflected in the Group’s consolidated financial statements include, but are not limited to, useful lives of property, equipment and software and intangible assets, impairment assessments of long-lived assets and goodwill, fair value of assets acquired and liabilities assumed in a business combination, valuation allowance for deferred tax assets, the provision for credit losses of financial assets and valuation of share-based compensation. Management bases the estimates on historical experience, known trends and various other assumptions that are believed to be reasonable under current circumstances. Actual results could differ from those estimates. |
Functional currency and foreign currency translation | (d) Functional currency and foreign currency translation The Group’s reporting currency is Renminbi (“RMB”). The functional currency of the Company and subsidiaries incorporated in Hong Kong and the United States of America, is the United States dollars (“US$”). The functional currency of the Group’s PRC subsidiaries, consolidated VIE and VIE’s subsidiaries is RMB. The determination of the respective functional currency is based on the criteria of ASC 830, Foreign Currency Matters Transactions denominated in currencies other than the functional currency are translated into the functional currency of the entity at the exchange rates quoted by authoritative banks prevailing on the transaction dates. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency using the applicable exchange rates at the balance sheet dates. Exchange gain or loss resulting from those foreign currency transactions denominated in foreign currencies is recorded in foreign exchange gain/(loss) the consolidated financial statements. The financial statements of the Company and subsidiaries located outside of the PRC are translated from their functional currency into RMB. Their assets and liabilities are translated into RMB using the applicable exchange rates at the balance sheet date. Equity accounts other than earnings generated in current period are translated into RMB at the appropriate historical rates. Revenues, expenses, gain and loss are translated into RMB using the periodic average exchange rates. The resulting foreign currency translation adjustments are recorded in other comprehensive income/(loss) in the consolidated financial statements. |
Convenience translation | (e) Convenience translation Translations of the consolidated balance sheets, the consolidated statements of comprehensive income/(loss) and the consolidated statements of cash flows from RMB into US$ as of and for the year ended December 31, 2022 are solely for the convenience of the readers, and were calculated at the rate of RMB6.8972 per US$1.00 on December 30, 2022 as set forth in the H.10 statistical release of the U.S. Federal Reserve Board. No representation is made that the RMB amounts could have been, or could be, converted, realized or settled into US$ at that rate or at any other rate. |
Fair value measurement | (f) Fair value measurement Accounting guidance defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurement for assets and liabilities required or permitted to be recorded at fair value, the Group considers the principal or most advantageous market in which it would transact and it considers assumptions that market participants would use when pricing the asset or liability. Accounting guidance establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Accounting guidance establishes three levels of inputs that may be used to measure fair value: ● Level 1 – Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. ● Level 2 – Include other inputs that are directly or indirectly observable in the marketplace. ● Level 3 – Unobservable inputs which are supported by little or no market activity. Accounting guidance also describes three main approaches to measuring the fair value of assets and liabilities: (1) market approach; (2) income approach and (3) cost approach. The market approach uses prices and other relevant information generated from market transactions involving identical or comparable assets or liabilities. The income approach uses valuation techniques to convert future amounts to a single present value amount and the measurement is based on the value indicated by current market expectations about those future amounts. The cost approach is based on the amount that would currently be required to replace an asset. Financial assets and liabilities of the Group mainly consist of cash and cash equivalents, short-term investments, accounts receivable, amounts due from related parties, prepayments and other current assets, accounts payable and other current liabilities. Except for short-term investments, the carrying values of other financial assets and liabilities approximate their fair values due to the short-term maturity of these instruments. The Group reports short-term investments at fair value based on Level 2 measurement. |
Business combination | (g) Business combination Business combinations are recorded using the purchase method of accounting in accordance with ASC 805, Business Combinations |
Cash and cash equivalents | (h) Cash and cash equivalents Cash and cash equivalents include cash on hand, deposits and highly liquid investments that are readily convertible to known amounts of cash, which have original maturities of three months or less. |
Short-term investments | (i) Short-term investments Short-term investments mainly include wealth management products issued by financial institutions, which are principal-not-guaranteed or with original maturities longer than three months but less than one year. These investments are stated at fair value and changes in the fair value are reflected in investment income in the consolidated statements of comprehensive income/(loss). Additionally, short-term investments are comprised of deposits with original maturities longer than three months but less than one year. |
Accounts receivable, net | (j) Accounts receivable, net Accounts receivable are presented net of allowance for credit losses. The Group adopts ASC 326 from 2022 and provides an allowance against accounts receivable based on the expected credit loss approach as described in Note 2(aa). No material allowance was recognized for the years ended December 31, 2020, 2021 and 2022. |
Property, equipment and software | (k) Property, equipment and software Property, equipment and software are stated at cost less accumulated depreciation and impairment, if any. Property, equipment and software are depreciated over the estimated useful lives on a straight-line basis. The estimated useful lives are as follows: Category Estimated useful lives Electronic equipment 3-5 years Leasehold improvement Shorter of lease term or estimated useful life of the assets Furniture and fixtures 5 years Motor vehicles 3-5 years Software 5 years The majority of electronic equipment are servers. The Group recognized the gain or loss on the disposal of property, equipment and software in other operating income/(expenses) in the consolidated statements of comprehensive income/(loss). |
Intangible Assets | (l) Intangible Assets Intangible assets purchased are initially recognized at cost, and intangible assets acquired in a business combination are initially recorded at fair value as of the acquisition date. Intangible assets with finite useful lives are amortized on a straight-line basis over the estimated useful lives, which are determined based on the period of contractual rights or estimated period during which such assets can bring economic benefits to the Group. The estimated useful lives are as follows: Category Estimated useful lives Domains 10 years Non-compete agreements 6 years Trademarks 3 years Database 3 years |
Impairment of long-lived assets other than goodwill | (m) Impairment of long-lived assets other than goodwill Long-lived assets, such as fixed assets and intangible assets with finite lives, are evaluated for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be fully recoverable. The Group evaluates the impairment for the long-lived assets by comparing the carrying value of the assets to the undiscounted future cash flows expected to be generated from the use of the assets and their eventual disposition. If the sum of the expected undiscounted future cash flows is less than the carrying value of the asset, the Group recognizes an impairment loss based on the excess of the carrying value of the asset over the fair value of the asset. No impairment of long-lived assets was recognized for the years ended December 31, 2020, 2021 and 2022. |
Goodwill | (n) Goodwill Goodwill represents the excess of the purchase price over the fair value of the identifiable assets and liabilities acquired or assumed in a business combination. Goodwill is tested for impairment at least annually and more frequently when an event occurs or circumstances change that could indicate that the asset might be impaired. In accordance with ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment |
Revenue recognition | (o) Revenue recognition The Group accounted for revenue under ASC 606, Revenue from Contracts with Customers Deferred revenue The Group records deferred revenue when the Group receives customers’ payments in advance of transferring control of services to customers. Substantially all deferred revenue recorded are expected to be recognized as revenues in the next twelve months. Remaining performance obligations Remaining performance obligations represent the amount of contracted future revenues not yet recognized as the amount relate to undelivered performance obligations. Substantially all of the Group’s contracts with customers are within one year in duration. As such, the Group has elected to apply the practical expedient which allows an entity to exclude disclosures about its remaining performance obligations if the performance obligation is part of a contract that has an original expected duration of one year or less. |
Cost of revenues | (p) Cost of revenues Cost of revenues primarily consist of third-party payment processing cost, payroll and other employee-related expenses, server and bandwidth service cost, server depreciation and other expenses, which are directly attributable to the performance of the Group’s online recruitment services. |
Sales and marketing expenses | (q) Sales and marketing expenses Sales and marketing expenses primarily consist of advertising expenses, payroll and other employee-related expenses for the Group’s sales and marketing staff, as well as other expenses such as office rental and property management fees for sales functions. Advertising expenses primarily include online traffic acquisition and brand marketing cost. For the years ended December 31, 2020, 2021 and 2022, advertising expenses totaled RMB812,415, RMB997,650 and RMB793,211, respectively. |
Research and development expenses | (r) Research and development expenses Research and development expenses primarily consist of payroll and other employee-related expenses for the Group’s research and development staff and other expenses such as office rental and property management fees for research and development functions. All research and development costs are expensed as incurred. |
General and administrative expenses | (s) General and administrative expenses General and administrative expenses primarily consist of payroll and other employee-related expenses for the Group’s managerial and administrative staff and other expenses such as office rental and property management fees. |
Employee benefits | (t) Employee benefits Full-time employees of the Group in the PRC participate in a government mandated defined contribution plan, pursuant to which certain pension benefits, medical care, employee housing fund and other welfare benefits are provided to employees. Chinese labor regulations require that the PRC subsidiaries, consolidated VIE and VIE’s subsidiaries of the Group make contributions to the government for these benefits based on certain percentages of the employees’ salaries, up to a maximum amount specified by the local government. The Group has no legal obligation for the benefits beyond the contributions made. Total amounts of such employee benefit expenses contributed by the Group, including accrued and unpaid amounts, were RMB135,478, RMB256,533 and RMB395,193 for the years ended December 31, 2020, 2021 and 2022, respectively. |
Share-based compensation | (u) Share-based compensation The Group grants share options and restricted share units (“RSUs”) to its management, eligible employees and non-employees. Such compensation is accounted for in accordance with ASC 718, Compensation-Stock Compensation Improvements to Non-employee Share-Based Payment Accounting Share-based awards with service conditions only are measured at the grant-date fair value of the awards and recognized as expenses using the straight-line method over the requisite service period. Share-based awards that are subject to both service conditions and the occurrence of an IPO or change of control as a performance condition, are measured at the grant-date fair value, and cumulative share-based compensation expenses for the awards that have satisfied the service condition were recorded upon the completion of the Company’s US IPO in June 2021. The fair value of share options is estimated using the binomial option-pricing model. The determination of the fair value is affected by the fair value of the ordinary shares as well as assumptions regarding a number of complex and subjective variables, including the expected share price volatility, actual and projected employee and non-employee share option exercise behavior, risk-free interest rates and expected dividend yield. Binomial option-pricing model incorporates the assumptions about grantees’ future exercise patterns. The fair value of these awards was determined by management with the assistance from an independent valuation firm using management’s estimates and assumptions. The fair value of the RSUs, which were granted subsequent to the completion of the Company’s US IPO, is estimated based on the fair value of the underlying ordinary shares of the Company on the grant date. The assumptions used in share-based compensation expense recognition represent management’s best estimates, but these estimates involve inherent uncertainties and application of management judgment. If factors change or different assumptions are used, the share-based compensation expenses could be materially different for any period. Moreover, the estimates of fair value of the awards are not intended to predict actual future events or the value that ultimately will be realized by grantees who receive share-based awards. |
Operating leases | (v) Operating leases The Group accounts for operating leases in accordance with ASC 842, Leases For operating lease with a term of one year or less, the Group has elected to not recognize any right-of-use asset or lease liability on its consolidated balance sheets. Instead, it recognizes the lease payments as operating cost and expenses in the consolidated statements of comprehensive income/(loss) on a straight-line basis over the lease term. Short-term lease expenses are immaterial to the consolidated statements of comprehensive income/(loss). |
Income tax | (w) Income tax Current income taxes are recorded in accordance with the regulations of the relevant tax jurisdiction. The Group accounts for deferred income taxes under the liability method in accordance with ASC 740, Income Tax The Group recognizes the benefit of a tax position if the tax position is more-likely-than-not to prevail based on the facts and technical merits of the position. Tax positions that meet the more-likely-than-not recognition threshold is then measured at the largest amount of tax benefit that has a greater than fifty percent likelihood of being realized upon settlement. The Group estimates its liability for unrecognized tax benefits which are periodically assessed and may be affected by changing interpretations of laws, rulings by tax authorities, changes and/or developments with respect to tax audits, and expiration of the statute of limitations. The ultimate outcome for a particular tax position may not be determined with certainty prior to the conclusion of a tax audit and, in some cases, appeal or litigation process. The actual benefits ultimately realized may differ from the Group’s estimates and any adjustments are recorded in the Group’s consolidated financial statements in the period in which the audit is concluded. Additionally, changes in facts, circumstances and new information may require the Group to adjust the recognition and measurement estimates with regard to individual tax positions and such changes are recognized in the period in which the changes occur. As of December 31, 2022, the Group did not have any significant unrecognized uncertain tax positions. |
Comprehensive income/(loss) | (x) Comprehensive income/(loss) Comprehensive income/(loss) is defined as the change in equity of a company during a period from transactions and other events and circumstances excluding those resulting from investments by shareholders and distributions to shareholders. The Group recognizes foreign currency translation adjustments as other comprehensive income/(loss) in the consolidated financial statements. As such adjustments do not incur income tax obligations, there are no tax adjustments to arrive at other comprehensive income/(loss) on a net-of-tax basis. |
Segment reporting | (y) Segment reporting In accordance with ASC 280, Segment Reporting |
Net income/(loss) per share | (z) Net income/(loss) per share Basic net income/(loss) per share is computed by dividing net income/(loss) attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted net income/(loss) per share is calculated by dividing net income/(loss) attributable to ordinary shareholders by the weighted average number of ordinary shares and, if dilutive, potential ordinary shares outstanding during the period. Potential ordinary shares consist of shares issuable upon the conversion of the preferred shares using the if-converted method, for periods prior to the completion of the Company’ US IPO in June 2021, unvested RSUs and shares issuable upon the exercise of share options using the treasury stock method. The two-class method is used for computing net income per share in the event the Group has net income available for distribution. Under the two-class method, net income is allocated between ordinary shares and other participating securities based on their participating rights, if applicable. Prior to the completion of the Company’ US IPO in June 2021, the computation of basic net loss per share using the two-class method was not applicable as the Group was in a net loss position and the participating securities did not have contractual obligations to share in the loss of the Group. |
Recently adopted accounting pronouncements | (aa) Recent accounting pronouncements Recently adopted accounting pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments Credit Losses Recent accounting pronouncements not yet adopted In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers |
PRINCIPAL ACTIVITIES AND ORGA_2
PRINCIPAL ACTIVITIES AND ORGANIZATION (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
PRINCIPAL ACTIVITIES AND ORGANIZATION | |
Schedule of principal subsidiaries and consolidated VIE | As of December 31, 2022, the Company’s principal subsidiaries and consolidated VIE are as follows: Company name Place of incorporation Date of incorporation Equity interest/economic interest held Principal activities and place of operation Principal subsidiaries Techfish Limited Hong Kong, China February 14, 2014 100% Investment holding in Hong Kong Beijing Glory Wolf Co., Ltd. (the “WFOE”) Beijing, China May 7, 2014 100% Management consultancy and technical services in the PRC VIE Beijing Huapin Borui Network Technology Co., Ltd. (“Huapin”) Beijing, China December 25, 2013 100% Online recruitment services in the PRC |
Schedule of variable interest entities | As of December 31, 2021 2022 RMB RMB ASSETS Current assets Cash and cash equivalents 864,851 1,020,243 Short-term investments 864,557 1,244,243 Accounts receivable, net 1,002 2,253 Amounts due from Group companies 86,989 136,757 Amounts due from related parties 6,615 5,714 Prepayments and other current assets 487,598 528,908 Total current assets 2,311,612 2,938,118 Non-current assets Property, equipment and software, net 368,381 688,578 Intangible assets, net 458 368 Right-of-use assets, net 301,288 281,913 Other non-current assets 4,000 4,000 Total non-current assets 674,127 974,859 Total assets 2,985,739 3,912,977 LIABILITIES Current liabilities Accounts payable 52,938 185,211 Deferred revenue 1,958,570 2,058,569 Other payables and accrued liabilities 626,151 576,189 Amounts due to Group companies 27,223 14,876 Operating lease liabilities, current 124,464 146,359 Total current liabilities 2,789,346 2,981,204 Non-current liabilities Operating lease liabilities, non-current 178,844 141,096 Deferred tax liabilities — 9,427 Total non-current liabilities 178,844 150,523 Total liabilities 2,968,190 3,131,727 For the year ended December 31, 2020 2021 2022 RMB RMB RMB Total revenues 1,944,359 4,259,128 4,498,131 Cost of revenues (232,261) (554,575) (750,932) Net ( loss )/income (303,061) 551,133 117,298 For the year ended December 31, 2020 2021 2022 RMB RMB RMB Net cash generated from operating activities 494,187 1,717,104 893,078 Net cash used in investing activities (632,568) (591,213) (702,542) Net cash generated from/(used in) financing activities 260,484 (444,239) (35,144) Net increase in cash and cash equivalents 122,103 681,652 155,392 Cash and cash equivalents at beginning of the year 61,096 183,199 864,851 Cash and cash equivalents at end of the year 183,199 864,851 1,020,243 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of property, equipment and software | Category Estimated useful lives Electronic equipment 3-5 years Leasehold improvement Shorter of lease term or estimated useful life of the assets Furniture and fixtures 5 years Motor vehicles 3-5 years Software 5 years |
Schedule of intangible assets | Category Estimated useful lives Domains 10 years Non-compete agreements 6 years Trademarks 3 years Database 3 years |
SHORT-TERM INVESTMENTS (Tables)
SHORT-TERM INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
SHORT-TERM INVESTMENTS | |
Schedule of short-term investments | As of December 31, 2021 2022 RMB RMB Wealth management products 884,996 2,665,047 Deposits — 793,042 Total 884,996 3,458,089 |
PREPAYMENTS AND OTHER CURRENT_2
PREPAYMENTS AND OTHER CURRENT ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
PREPAYMENTS AND OTHER CURRENT ASSETS | |
Schedule of prepayments and other current assets | As of December 31, 2021 2022 RMB RMB Prepaid advertising expenses and service fee 234,490 211,604 Receivables related to the exercise of share-based awards* 289,822 172,452 Deposits 63,814 68,390 Staff loans and advances 52,695 33,672 Receivables from third-party online payment platforms 63,866 30,317 Others 19,896 84,338 Total 724,583 600,773 |
PROPERTY, EQUIPMENT AND SOFTW_2
PROPERTY, EQUIPMENT AND SOFTWARE, NET (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
PROPERTY, EQUIPMENT AND SOFTWARE, NET | |
Schedule of property, equipment and software, net | As of December 31, 2021 2022 RMB RMB Electronic equipment 429,683 849,020 Leasehold improvement 65,885 95,554 Furniture and fixtures 12,784 18,514 Motor vehicles 3,904 5,272 Software 3,126 4,055 Total cost 515,382 972,415 Less: accumulated depreciation (146,256) (281,379) Total property, equipment and software, net 369,126 691,036 |
BUSINESS ACQUISITION (Tables)
BUSINESS ACQUISITION (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
BUSINESS ACQUISITION | |
Schedule of fair value of the assets acquired and the liabilities assumed | Amount RMB Purchase consideration 10,000 Identifiable intangible assets acquired —Non-compete agreements 8,400 —Trademarks 1,000 —Database 1,000 Goodwill 5,690 Deferred tax liabilities (2,080) Net liabilities assumed (4,010) Total 10,000 |
ACCOUNTS PAYABLE (Tables)
ACCOUNTS PAYABLE (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
ACCOUNTS PAYABLE | |
Schedule of accounts payable | As of December 31, 2021 2022 RMB RMB Payables for purchase of property, equipment and software 19,987 142,142 Payables for advertising expenses 30,646 32,277 Others 2,330 10,878 Total 52,963 185,297 |
OTHER PAYABLES AND ACCRUED LI_2
OTHER PAYABLES AND ACCRUED LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
OTHER PAYABLES AND ACCRUED LIABILITIES | |
Schedule of other payables and accrued liabilities | As of December 31, 2021 2022 RMB RMB Salary, welfare and bonus payable 373,286 366,454 Tax payable (1) 218,419 152,598 Advance from customers (2) 41,070 58,630 Others 12,363 55,800 Total 645,138 633,482 (1) Tax payable mainly included value-added tax, enterprise income tax and individual income tax payable mainly related to the exercise of share-based awards. (2) It represents advance payments from customers stored in their own accounts in the Group’s platform, which are refundable and could be used to exchange for the Group’s services. |
REVENUES (Tables)
REVENUES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
REVENUES | |
Schedule of revenue | For the year ended December 31, 2020 2021 2022 RMB RMB RMB Online recruitment services to enterprise customers 1,927,178 4,219,026 4,461,282 —Key accounts 330,795 928,360 1,033,561 —Mid-sized accounts 696,325 1,513,506 1,774,855 —Small-sized accounts 900,058 1,777,160 1,652,866 Others 17,181 40,102 49,780 Total 1,944,359 4,259,128 4,511,062 |
OPERATING LEASE (Tables)
OPERATING LEASE (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
OPERATING LEASE | |
Schedule of components of lease expenses | For the year ended December 31, 2020 2021 2022 RMB RMB RMB Operating lease expenses 71,706 116,091 162,448 Short-term lease expenses 2,167 2,177 1,947 Total 73,873 118,268 164,395 |
Schedule of supplemental balance sheet information related to operating lease | As of December 31, 2021 2022 RMB RMB Right-of-use assets, net 309,085 289,628 Operating lease liabilities, current 127,531 151,438 Operating lease liabilities, non-current 183,365 143,591 Total operating lease liabilities 310,896 295,029 As of December 31, 2021 2022 RMB RMB Weighted average remaining lease term (in years) 3.26 2.60 Weighted average discount rate 4.82% 4.81% |
Schedule of supplemental cash flow information related to operating lease | For the year ended December 31, 2020 2021 2022 RMB RMB RMB Cash paid for amounts included in the measurement of operating lease liabilities 72,138 102,154 154,626 Right-of-use assets obtained in exchange for operating lease liabilities 112,871 274,358 139,968 |
Schedule of maturities of lease liabilities | As of December 31, 2022 RMB 2023 154,865 2024 82,310 2025 49,935 2026 25,451 2027 1,833 Thereafter — Total undiscounted lease payments 314,394 Less: imputed interest (19,365) Total operating lease liabilities 295,029 |
INCOME TAX (Tables)
INCOME TAX (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
INCOME TAX | |
Schedule of components of (loss)/income before income tax | For the year ended December 31, 2020 2021 2022 RMB RMB RMB (Loss)/Income from PRC entities (311,483) 610,813 125,529 Loss from overseas entities (630,412) (1,622,360) (8,533) Total (941,895) (1,011,547) 116,996 |
Schedule of components of income tax expenses | For the year ended December 31, 2020 2021 2022 RMB RMB RMB Current income tax expenses — 59,527 427 Deferred income tax expenses — — 9,324 Total — 59,527 9,751 |
Schedule of reconciliation between the PRC statutory income tax rate and effective income tax rate | For the year ended December 31, 2020 2021 2022 RMB RMB RMB PRC statutory income tax rate 25.00 % 25.00 % 25.00 % Effect of tax-exempt entities and tax rates in different jurisdictions (15.82) % (37.89) % (21.95) % Effect of preferential tax rates (3.36) % 5.15 % (10.43) % Effect of permanent difference* 2.22 % 1.24 % (11.00) % Changes in valuation allowance (7.89) % (8.38) % 16.63 % Others (0.15) % 9.00 % 10.08 % Effective tax rate — (5.88) % 8.33 % * The effect of permanent difference for the year ended December 31, 2022 was primarily related to additional tax deductions for qualified research and development expenses and newly purchased equipment, partially offset by non-deductible share-based compensation expenses. |
Schedule of deferred tax assets and liabilities | As of December 31, 2021 2022 RMB RMB Deferred tax assets Deductible advertising expenses 262,801 272,810 Net operating loss carry-forwards 70,985 94,704 Others 1,062 58 Total deferred tax assets 334,848 367,572 Less: valuation allowance (334,848) (354,306) Total deferred tax assets, net of valuation allowance — 13,266 Deferred tax liabilities Accelerated tax depreciation — (22,693) Identifiable intangible assets arising from business acquisition — (1,977) Total deferred tax liabilities — (24,670) Deferred tax liabilities, net of deferred tax assets — (11,404) |
Schedule of movements of valuation allowance | For the year ended December 31, 2020 2021 2022 RMB RMB RMB Balance at beginning of the year 175,757 250,032 334,848 Change of valuation allowance 74,275 84,816 19,458 Balance at end of the year 250,032 334,848 354,306 |
CONVERTIBLE REDEEMABLE PREFER_2
CONVERTIBLE REDEEMABLE PREFERRED SHARES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
CONVERTIBLE REDEEMABLE PREFERRED SHARES | |
Schedule of convertible redeemable preferred share | The Company’s convertible redeemable preferred shares activities for the years ended December 31, 2020 and 2021 are summarized below: Series A Series B Series C Series D Series E Series F Preferred Preferred Preferred Preferred Preferred Preferred Shares Shares Shares Shares Shares Shares Total Number Number Number Number Number Number Number of shares Amount of shares Amount of shares Amount of shares Amount of shares Amount of shares Amount of shares Amount RMB RMB RMB RMB RMB RMB RMB Balance as of January 1, 2020 60,000,000 33,434 40,000,000 62,785 147,068,133 443,367 60,856,049 352,586 144,073,367 1,711,329 — — 451,997,549 2,603,501 Issuance of Series F Preferred Shares, net of issuance cost — — — — — — — — — — 99,354,585 2,803,114 99,354,585 2,803,114 Accretion on convertible redeemable preferred shares to redemption value — 2,743 — 5,191 — 35,198 — 28,196 — 133,704 — 78,949 — 283,981 Balance as of December 31, 2020 60,000,000 36,177 40,000,000 67,976 147,068,133 478,565 60,856,049 380,782 144,073,367 1,845,033 99,354,585 2,882,063 551,352,134 5,690,596 Accretion on convertible redeemable preferred shares to redemption value — 1,057 — 2,006 — 13,580 — 10,823 — 51,072 — 85,527 — 164,065 Conversion of Preferred Shares to ordinary shares (60,000,000) (37,234) (40,000,000) (69,982) (147,068,133) (492,145) (60,856,049) (391,605) (144,073,367) (1,896,105) (99,354,585) (2,967,590) (551,352,134) (5,854,661) Balance as of December 31, 2021 — — — — — — — — — — — — — — |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
SHARE-BASED COMPENSATION | |
Schedule of stock option activity | Weighted Weighted Weighted average average Aggregate average grant– Number of exercise remaining intrinsic date share options price contractual life value fair value US$ In Years US$ US$ Outstanding as of January 1, 2020 86,221,721 0.76 7.22 65,994 0.27 Granted 26,509,592 2.42 Exercised (5,597,960) 1.00 Outstanding as of December 31, 2020 107,133,353 1.16 6.84 226,639 0.64 Granted 32,710,153 4.14 Exercised (54,385,484) 0.55 Forfeited (2,982,054) 1.98 Outstanding as of December 31, 2021 82,475,968 2.71 8.05 1,214,916 2.82 Granted* 8,424 0.00 Exercised (12,413,256) 1.59 Forfeited (1,709,938) 3.39 Outstanding as of December 31, 2022 68,361,198 2.90 7.23 498,336 2.99 Vested and expected to vest as of December 31, 2022 68,361,198 2.90 7.23 498,336 2.99 Exercisable as of December 31, 2022 32,268,060 2.08 6.51 261,387 1.69 * The exercise price and grant-date fair value of share options granted in 2022 was US$ 0.0001 and US$12.13, respectively. 15. |
Schedule of assumptions in the binomial option-pricing model to determine the fair value of the share options | For the year ended December 31, 2020 2021 Fair value of ordinary shares on the date of option grant (US$) 1.84-3.27 6.78-18.09 Risk-free interest rate (1) 0.82%-1.70% 1.6%-2.0% Expected term (in years) 10 10 Expected dividend yield (2) 0% 0% Expected volatility (3) 56.5%-59.0% 58.8%-59.8% Expected early exercise multiple 2.2x-2.8x 2.2x-2.8x (1) The risk-free interest rate of periods within the contractual life of the share option is based on the market yield of U.S. Treasury Strips with a maturity life equal to the expected term of share options. (2) The Company has no history or expectation of paying dividends on its ordinary shares. (3) Expected volatility is estimated based on the average of historical volatilities of the comparable companies in the same industry as at the valuation dates. |
Schedule of RSU activity | Weighted average Number of RSUs grant-date fair value US$ Outstanding as of January 1, 2021 — — Granted 3,521,118 Outstanding as of December 31, 2021 3,521,118 19.05 Granted 19,686,470 Vested (1,959,584) Forfeited (435,058) Outstanding as of December 31, 2022 20,812,946 11.23 As of December 31, 2022, there were US$214,322 of unrecognized compensation expenses related to RSUs, which are expected to be recognized over a weighted-average period of 3.5 years and may be adjusted for future forfeitures. |
Schedule of share-based compensation expenses | For the year ended December 31, 2020 2021 2022 RMB RMB RMB Cost of revenues 1,920 31,467 39,587 Sales and marketing expenses 21,473 73,733 170,366 Research and development expenses 30,883 137,820 284,323 General and administrative expenses* 602,960 1,680,626 197,928 Total 657,236 1,923,646 692,204 * In November 2020 and June 2021, the Company granted 24,780,971 and 24,745,531 Class B ordinary shares to TECHWOLF LIMITED, and recorded share-based compensation expenses of RMB533.1 million and RMB1,506.4 million, respectively, in general and administrative expenses upon the grant (Note 13). |
NET (LOSS)_INCOME PER SHARE (Ta
NET (LOSS)/INCOME PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
NET (LOSS)/INCOME PER SHARE | |
Schedule of basic and diluted net loss per share | For the year ended December 31, 2020 2021 2022 RMB RMB RMB Numerator Net (loss)/income (941,895) (1,071,074) 107,245 Accretion on convertible redeemable preferred shares to redemption value (283,981) (164,065) — Net (loss)/income attributable to ordinary shareholders (1,225,876) (1,235,139) 107,245 Denominator Weighted average number of ordinary shares used in computing net (loss)/income per share, basic 111,172,986 529,343,027 868,941,151 Dilutive effect of share-based awards — — 43,200,840 Weighted average number of ordinary shares used in computing net (loss)/income per share, diluted 111,172,986 529,343,027 912,141,991 Net (loss)/income per share attributable to ordinary shareholders —Basic (11.03) (2.33) 0.12 —Diluted (11.03) (2.33) 0.12 |
Schedule of anti-dilutive and excluded from the computation of diluted net loss per share | For the year ended December 31, 2020 2021 Preferred shares 500,211,192 251,440,808 Share options and RSUs 60,853,313 78,376,179 |
RELATED PARTY BALANCES AND TR_2
RELATED PARTY BALANCES AND TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
RELATED PARTY BALANCES AND TRANSACTIONS | |
Schedule of name of major related parties and their relationships with the group | The table below sets forth major related parties with which the Group had transactions during the years presented and their relationships with the Group: Name of related parties Relationship with the Group Mr. Peng Zhao and companies controlled by him Founder, Chairman and CEO of the Group and his controlled companies Image Frame Investment (HK) Limited (under the control of Tencent Holdings Limited ) Principal shareholder of the Group Individual executive officer Executive officer of the Group |
Schedule of amounts due from related parties | Details of major amounts due from related parties for the years presented are as follows: As of December 31, 2021 2022 RMB RMB Receivables from the online payment platform of Tencent Group* 4,284 3,177 Prepaid cloud service fee to Tencent Group* 2,331 2,537 Total 6,615 5,714 |
Schedule of transactions with related parties | Details of major transactions with related parties for the years presented are as follows: For the year ended December 31, 2020 2021 2022 RMB RMB RMB Cloud services from Tencent Group* 6,109 18,119 26,256 Online payment clearing services from Tencent Group* 1,886 5,464 4,533 Total 7,995 23,583 30,789 * Tencent Group represents companies under the control of Tencent Holdings Limited, including Image Frame Investment (HK) Limited. The Group purchases cloud services and online payment clearing services from Tencent Group, which are trade in nature. |
FAIR VALUE MEASUREMENT (Tables)
FAIR VALUE MEASUREMENT (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
FAIR VALUE MEASUREMENT | |
Schedule of fair value, assets and liabilities measured on recurring basis | Fair value measurement at reporting date using Quoted prices in active Significant other Significant markets for identical assets observable inputs unobservable Description Fair value (Level 1) (Level 2) inputs (Level 3) RMB RMB RMB RMB Short-term investments As of December 31, 2021 884,996 — 884,996 — As of December 31, 2022 3,458,089 — 3,458,089 — |
PRINCIPAL ACTIVITIES AND ORGA_3
PRINCIPAL ACTIVITIES AND ORGANIZATION - Summary of Principal Subsidiaries and Consolidated VIE (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Techfish Limited | Subsidiaries | |
PRINCIPAL ACTIVITIES AND ORGANIZATION | |
Equity interest/economic interest held | 100% |
Beijing Glorywolf Co., Ltd. | Subsidiaries | |
PRINCIPAL ACTIVITIES AND ORGANIZATION | |
Equity interest/economic interest held | 100% |
Beijing Huapin Borui Network Technology Co., Ltd. | Consolidated VIE | |
PRINCIPAL ACTIVITIES AND ORGANIZATION | |
Equity interest/economic interest held | 100% |
PRINCIPAL ACTIVITIES AND ORGA_4
PRINCIPAL ACTIVITIES AND ORGANIZATION - Summary of Financial Information of consolidated VIE (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2022 CNY (¥) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2020 CNY (¥) | Dec. 31, 2022 USD ($) | |
Current assets | |||||
Cash and cash equivalents | ¥ 9,751,824 | ¥ 11,341,758 | $ 1,413,882 | ||
Short-term investments | 3,458,089 | 884,996 | 501,376 | ||
Accounts receivable, net | 9,862 | 1,002 | 1,430 | ||
Amounts due from related parties | 5,714 | 6,615 | 828 | ||
Prepayments and other current assets | 600,773 | 724,583 | 87,104 | ||
Total current assets | 13,826,262 | 12,958,954 | 2,004,620 | ||
Non-current assets | |||||
Property, equipment and software, net | 691,036 | 369,126 | 100,191 | ||
Intangible assets, net | 10,251 | 458 | 1,486 | ||
Right-of-use assets, net | 289,628 | 309,085 | 41,992 | ||
Other non-current assets | 4,000 | 4,000 | 580 | ||
Total non-current assets | 1,000,605 | 682,669 | 145,074 | ||
Total assets | 14,826,867 | 13,641,623 | 2,149,694 | ||
Current liabilities | |||||
Accounts payable | 185,297 | 52,963 | 26,866 | ||
Deferred revenue | 2,060,892 | 1,958,570 | 298,801 | ||
Other payables and accrued liabilities | 633,482 | 645,138 | 91,846 | ||
Operating lease liabilities, current | 151,438 | 127,531 | 21,956 | ||
Total current liabilities | 3,031,109 | 2,784,202 | 439,469 | ||
Non-current liabilities | |||||
Operating lease liabilities, non-current | 143,591 | 183,365 | 20,819 | ||
Deferred tax liabilities | 11,404 | 1,653 | |||
Total non-current liabilities | 154,995 | 183,365 | 22,472 | ||
Total liabilities | 3,186,104 | 2,967,567 | $ 461,941 | ||
Total revenues | 4,511,062 | $ 654,042 | 4,259,128 | ¥ 1,944,359 | |
Cost of revenues | (754,861) | (109,445) | (554,648) | (240,211) | |
Net loss/income | 107,245 | 15,548 | (1,071,074) | (941,895) | |
Net cash generated from operating activities | 1,003,042 | 145,427 | 1,641,381 | 395,911 | |
Net cash used in investing activities | (2,816,581) | (408,365) | (601,862) | 467,305 | |
Net cash generated from/(used in) financing activities | (669,232) | (97,029) | 6,431,263 | 2,882,112 | |
Net increase in cash and cash equivalents | (1,589,934) | (230,518) | 7,343,555 | 3,590,848 | |
Cash and cash equivalents at beginning of the year | 11,341,758 | 1,644,400 | 3,998,203 | 407,355 | |
Cash and cash equivalents at end of the year | 9,751,824 | $ 1,413,882 | 11,341,758 | 3,998,203 | |
Consolidated VIE | |||||
Current assets | |||||
Cash and cash equivalents | 1,020,243 | 864,851 | |||
Short-term investments | 1,244,243 | 864,557 | |||
Accounts receivable, net | 2,253 | 1,002 | |||
Amounts due from Group companies | 136,757 | 86,989 | |||
Amounts due from related parties | 5,714 | 6,615 | |||
Prepayments and other current assets | 528,908 | 487,598 | |||
Total current assets | 2,938,118 | 2,311,612 | |||
Non-current assets | |||||
Property, equipment and software, net | 688,578 | 368,381 | |||
Intangible assets, net | 368 | 458 | |||
Right-of-use assets, net | 281,913 | 301,288 | |||
Other non-current assets | 4,000 | 4,000 | |||
Total non-current assets | 974,859 | 674,127 | |||
Total assets | 3,912,977 | 2,985,739 | |||
Current liabilities | |||||
Accounts payable | 185,211 | 52,938 | |||
Deferred revenue | 2,058,569 | 1,958,570 | |||
Other payables and accrued liabilities | 576,189 | 626,151 | |||
Amounts Due To Group Companies | 14,876 | 27,223 | |||
Operating lease liabilities, current | 146,359 | 124,464 | |||
Total current liabilities | 2,981,204 | 2,789,346 | |||
Non-current liabilities | |||||
Operating lease liabilities, non-current | 141,096 | 178,844 | |||
Deferred tax liabilities | 9,427 | ||||
Total non-current liabilities | 150,523 | 178,844 | |||
Total liabilities | 3,131,727 | 2,968,190 | |||
Total revenues | 4,498,131 | 4,259,128 | 1,944,359 | ||
Cost of revenues | (750,932) | (554,575) | (232,261) | ||
Net loss/income | 117,298 | 551,133 | (303,061) | ||
Net cash generated from operating activities | 893,078 | 1,717,104 | 494,187 | ||
Net cash used in investing activities | (702,542) | (591,213) | (632,568) | ||
Net cash generated from/(used in) financing activities | (35,144) | (444,239) | 260,484 | ||
Net increase in cash and cash equivalents | 155,392 | 681,652 | 122,103 | ||
Cash and cash equivalents at beginning of the year | 864,851 | 183,199 | 61,096 | ||
Cash and cash equivalents at end of the year | ¥ 1,020,243 | ¥ 864,851 | ¥ 183,199 |
PRINCIPAL ACTIVITIES AND ORGA_5
PRINCIPAL ACTIVITIES AND ORGANIZATION - Additional Information (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
PRINCIPAL ACTIVITIES AND ORGANIZATION | ||
Registered Capitals and Statutory Reserves of Variable Interest Entity | ¥ 9,002 | ¥ 9,002 |
Threshold period for paying service fees | 30 days | |
Effective term of exclusive purchase option agreement | 10 years |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional (Details) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2020 CNY (¥) | Dec. 31, 2022 USD ($) | Jan. 01, 2022 CNY (¥) | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||
Rate of translations of amounts from RMB into US$ | 6.8972 | 6.8972 | |||
Advertising expenses | ¥ 793,211,000 | ¥ 997,650,000 | ¥ 812,415,000 | ||
Employee benefit expenses incurred | 395,193,000 | 256,533,000 | ¥ 135,478,000 | ||
Tax adjustments to arrive at other comprehensive income/(loss) | ¥ 0 | ||||
Number of Reportable Segments | 1 | ||||
Accumulated deficit | ¥ (3,586,480,000) | ¥ (3,693,119,000) | $ (519,991) | ||
ASU | Cumulative-effect adjustment | |||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||
Accumulated deficit | ¥ 606,000 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Summary of Property, Equipment and Software (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Electronic equipment | Minimum | |
Property, Equipment and Software | |
Property, Plant and Equipment, Useful lives | 3 years |
Electronic equipment | Maximum | |
Property, Equipment and Software | |
Property, Plant and Equipment, Useful lives | 5 years |
Leasehold improvement | |
Property, Equipment and Software | |
Property, Plant and Equipment, Estimated useful lives | Shorter of lease term or estimated useful life of the assets |
Furniture and fixtures | |
Property, Equipment and Software | |
Property, Plant and Equipment, Useful lives | 5 years |
Motor vehicles | Minimum | |
Property, Equipment and Software | |
Property, Plant and Equipment, Useful lives | 3 years |
Motor vehicles | Maximum | |
Property, Equipment and Software | |
Property, Plant and Equipment, Useful lives | 5 years |
Software | |
Property, Equipment and Software | |
Property, Plant and Equipment, Useful lives | 5 years |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Summary of Intangible assets (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Internet Domain Names | |
Finite Lived Intangible Assets | |
Estimated useful lives | 10 years |
Non-compete agreements | |
Finite Lived Intangible Assets | |
Estimated useful lives | 6 years |
Trademarks | |
Finite Lived Intangible Assets | |
Estimated useful lives | 3 years |
Database | |
Finite Lived Intangible Assets | |
Estimated useful lives | 3 years |
CONCENTRATION AND RISKS - Addit
CONCENTRATION AND RISKS - Additional Information (Details) - Foreign Currency exchange rate risk - RMB Against US Dollar | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
CONCENTRATION AND RISKS | |||
Percentage of depreciation in foreign currency exchange rate | 9.20% | ||
Percentage of appreciation in foreign currency exchange rate | 2.30% | 6.50% |
SHORT-TERM INVESTMENTS - Summar
SHORT-TERM INVESTMENTS - Summary of Short-Term Investment (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2022 CNY (¥) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 CNY (¥) |
SHORT-TERM INVESTMENTS | |||
Short-term investments | ¥ 3,458,089 | $ 501,376 | ¥ 884,996 |
Wealth management products | |||
SHORT-TERM INVESTMENTS | |||
Short-term investments | 2,665,047 | ¥ 884,996 | |
Deposits | |||
SHORT-TERM INVESTMENTS | |||
Short-term investments | ¥ 793,042 |
SHORT-TERM INVESTMENTS - Additi
SHORT-TERM INVESTMENTS - Additional Information (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 CNY (¥) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2020 CNY (¥) | |
SHORT-TERM INVESTMENTS | ||||
Investment income | ¥ 65,150 | $ 9,446 | ¥ 24,744 | ¥ 9,095 |
PREPAYMENTS AND OTHER CURRENT_3
PREPAYMENTS AND OTHER CURRENT ASSETS - Schedule of Prepaid Expenses and Other Current Assets (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2022 CNY (¥) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 CNY (¥) |
PREPAYMENTS AND OTHER CURRENT ASSETS | |||
Prepaid advertising expenses and service fee | ¥ 211,604 | ¥ 234,490 | |
Receivables related to the exercise of share-based awards | 172,452 | 289,822 | |
Deposits | 68,390 | 63,814 | |
Staff loans and advances | 33,672 | 52,695 | |
Receivables from third-party online payment platforms | 30,317 | 63,866 | |
Others | 84,338 | 19,896 | |
Total | ¥ 600,773 | $ 87,104 | ¥ 724,583 |
PROPERTY, EQUIPMENT AND SOFTW_3
PROPERTY, EQUIPMENT AND SOFTWARE, NET - Schedule of Property, Equipment and Software, Net (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2022 CNY (¥) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 CNY (¥) |
PROPERTY, EQUIPMENT AND SOFTWARE, NET | |||
Total cost | ¥ 972,415 | ¥ 515,382 | |
Less: accumulated depreciation | (281,379) | (146,256) | |
Total property, equipment and software, net | 691,036 | $ 100,191 | 369,126 |
Electronic equipment | |||
PROPERTY, EQUIPMENT AND SOFTWARE, NET | |||
Total cost | 849,020 | 429,683 | |
Leasehold improvement | |||
PROPERTY, EQUIPMENT AND SOFTWARE, NET | |||
Total cost | 95,554 | 65,885 | |
Furniture and fixtures | |||
PROPERTY, EQUIPMENT AND SOFTWARE, NET | |||
Total cost | 18,514 | 12,784 | |
Motor vehicles | |||
PROPERTY, EQUIPMENT AND SOFTWARE, NET | |||
Total cost | 5,272 | 3,904 | |
Software | |||
PROPERTY, EQUIPMENT AND SOFTWARE, NET | |||
Total cost | ¥ 4,055 | ¥ 3,126 |
PROPERTY, EQUIPMENT AND SOFTW_4
PROPERTY, EQUIPMENT AND SOFTWARE, NET - Additional Information (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
PROPERTY, EQUIPMENT AND SOFTWARE, NET | |||
Depreciation expenses | ¥ 139,470 | ¥ 80,009 | ¥ 41,004 |
BUSINESS ACQUISITION (Details)
BUSINESS ACQUISITION (Details) ¥ in Thousands, $ in Thousands | Oct. 11, 2022 CNY (¥) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2022 USD ($) |
Fair value of the assets acquired and the liabilities assumed | |||
Goodwill | ¥ 5,690 | $ 825 | |
Beijing Qihui | |||
Business Acquisition | |||
Percentage of equity interest acquired | 100% | ||
Cash consideration | ¥ 10,000 | ||
Fair value of the assets acquired and the liabilities assumed | |||
Purchase consideration | 10,000 | ||
Goodwill | 5,690 | ||
Deferred tax liabilities | (2,080) | ||
Net liabilities assumed | (4,010) | ||
Total | 10,000 | ||
Beijing Qihui | Non-compete agreements | |||
Fair value of the assets acquired and the liabilities assumed | |||
Identifiable intangible assets acquired | 8,400 | ||
Beijing Qihui | Trademarks | |||
Fair value of the assets acquired and the liabilities assumed | |||
Identifiable intangible assets acquired | 1,000 | ||
Beijing Qihui | Database | |||
Fair value of the assets acquired and the liabilities assumed | |||
Identifiable intangible assets acquired | ¥ 1,000 |
ACCOUNTS PAYABLE - Schedule of
ACCOUNTS PAYABLE - Schedule of Accounts Payable (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2022 CNY (¥) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 CNY (¥) |
ACCOUNTS PAYABLE | |||
Payables for purchase of property, equipment and software | ¥ 142,142 | ¥ 19,987 | |
Payables for advertising expenses | 32,277 | 30,646 | |
Others | 10,878 | 2,330 | |
Total | ¥ 185,297 | $ 26,866 | ¥ 52,963 |
OTHER PAYABLES AND ACCRUED LI_3
OTHER PAYABLES AND ACCRUED LIABILITIES - Schedule of Other Payables and Accrued Liabilities (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2022 CNY (¥) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 CNY (¥) |
OTHER PAYABLES AND ACCRUED LIABILITIES | |||
Salary, welfare and bonus payable | ¥ 366,454 | ¥ 373,286 | |
Tax payable | 152,598 | 218,419 | |
Advance from customers | 58,630 | 41,070 | |
Others | 55,800 | 12,363 | |
Total | ¥ 633,482 | $ 91,846 | ¥ 645,138 |
REVENUES (Details)
REVENUES (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 CNY (¥) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2020 CNY (¥) | |
REVENUES | ||||
Revenue | ¥ 4,511,062 | $ 654,042 | ¥ 4,259,128 | ¥ 1,944,359 |
Online recruitment services to enterprise customers | ||||
REVENUES | ||||
Revenue | 4,461,282 | 646,825 | 4,219,026 | 1,927,178 |
Others | ||||
REVENUES | ||||
Revenue | 49,780 | $ 7,217 | 40,102 | 17,181 |
Key accounts | Online recruitment services to enterprise customers | ||||
REVENUES | ||||
Revenue | 1,033,561 | 928,360 | 330,795 | |
Mid-sized accounts | Online recruitment services to enterprise customers | ||||
REVENUES | ||||
Revenue | 1,774,855 | 1,513,506 | 696,325 | |
Small-sized accounts | Online recruitment services to enterprise customers | ||||
REVENUES | ||||
Revenue | ¥ 1,652,866 | ¥ 1,777,160 | ¥ 900,058 |
REVENUES - Additional Informati
REVENUES - Additional Information (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 CNY (¥) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2020 CNY (¥) | |
REVENUES | ||||
Revenue | ¥ 4,511,062 | $ 654,042 | ¥ 4,259,128 | ¥ 1,944,359 |
Online recruitment services to enterprise customers | ||||
REVENUES | ||||
Revenue | 4,461,282 | $ 646,825 | 4,219,026 | 1,927,178 |
Transferred over time | Online recruitment services to enterprise customers | ||||
REVENUES | ||||
Revenue | 3,331,046 | 3,043,692 | 1,527,671 | |
Transferred at point in time | Online recruitment services to enterprise customers | ||||
REVENUES | ||||
Revenue | ¥ 1,130,236 | ¥ 1,175,334 | ¥ 399,507 |
OPERATING LEASE - Schedule of C
OPERATING LEASE - Schedule of Components of Lease Expenses (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
OPERATING LEASE | |||
Operating lease expenses | ¥ 162,448 | ¥ 116,091 | ¥ 71,706 |
Short-term lease expenses | 1,947 | 2,177 | 2,167 |
Total | ¥ 164,395 | ¥ 118,268 | ¥ 73,873 |
OPERATING LEASE - Schedule of S
OPERATING LEASE - Schedule of Supplemental Balance Sheet Information Related to Operating Lease (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2022 CNY (¥) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 CNY (¥) |
OPERATING LEASE | |||
Right-of-use assets, net | ¥ 289,628 | $ 41,992 | ¥ 309,085 |
Operating lease liabilities, current | 151,438 | 21,956 | 127,531 |
Operating lease liabilities, non-current | 143,591 | $ 20,819 | 183,365 |
Total operating lease liabilities | ¥ 295,029 | ¥ 310,896 | |
Weighted average remaining lease term (in years) | 2 years 7 months 6 days | 2 years 7 months 6 days | 3 years 3 months 3 days |
Weighted average discount rate | 4.81% | 4.81% | 4.82% |
OPERATING LEASE - Schedule of_2
OPERATING LEASE - Schedule of Supplemental Cash Flow Information Related to Operating Lease (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
OPERATING LEASE | |||
Cash paid for amounts included in the measurement of operating lease liabilities | ¥ 154,626 | ¥ 102,154 | ¥ 72,138 |
Right-of-use assets obtained in exchange for operating lease liabilities | ¥ 139,968 | ¥ 274,358 | ¥ 112,871 |
OPERATING LEASE - Schedule of M
OPERATING LEASE - Schedule of Maturities of Operating Lease Liabilities (Details) - CNY (¥) ¥ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
OPERATING LEASE | ||
2023 | ¥ 154,865 | |
2024 | 82,310 | |
2025 | 49,935 | |
2026 | 25,451 | |
2027 | 1,833 | |
Total undiscounted lease payments | 314,394 | |
Less: imputed interest | (19,365) | |
Total operating lease liabilities | ¥ 295,029 | ¥ 310,896 |
INCOME TAX- Narrative (Details)
INCOME TAX- Narrative (Details) - CNY (¥) ¥ in Thousands | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax | ||||
Statutory income tax rate | 25% | 25% | 25% | |
Deferred tax assets from net operating loss carry-forwards | ¥ 94,704 | ¥ 94,704 | ¥ 70,985 | |
Accumulated tax losses | 407,800 | 407,800 | ||
Variable Interest Entity, Primary Beneficiary | ||||
Income Tax | ||||
Deferred tax assets from net operating loss carry-forwards | ¥ 13,266 | ¥ 13,266 | ||
Qualified high and new technology enterprise | ||||
Income Tax | ||||
Preferential income tax rate | 15% | |||
Tax losses carryforward expiration period | 10 years | |||
UNITED STATES | California corporate franchise tax | ||||
Income Tax | ||||
Tax losses carryforward expiration period | 20 years | |||
China | ||||
Income Tax | ||||
Statutory income tax rate | 25% | |||
Percentage of purchase of equipment and appliances as tax deductible items | 200% | |||
Percentage of tax deduction on qualified research and development expenses | 200% | 175% | ||
Tax losses carryforward expiration period | 5 years | |||
Hong Kong | ||||
Income Tax | ||||
Statutory income tax rate | 16.50% |
INCOME TAX- Schedule of Compone
INCOME TAX- Schedule of Components of Loss Before Income Tax (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 CNY (¥) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2020 CNY (¥) | |
Income Loss From Operations Before Income Taxes By Jurisdiction Abstract | ||||
(Loss)/Income from PRC entities | ¥ 125,529 | ¥ 610,813 | ¥ (311,483) | |
Loss from overseas entities | (8,533) | (1,622,360) | (630,412) | |
(Loss)/Income before income tax expenses | ¥ 116,996 | $ 16,962 | ¥ (1,011,547) | ¥ (941,895) |
INCOME TAX - Schedule of Compon
INCOME TAX - Schedule of Components of Income Tax Expenses (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 CNY (¥) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 CNY (¥) | |
Components of Income Tax Expense (Benefit), Continuing Operations [Abstract] | |||
Current income tax expense | ¥ 427 | ¥ 59,527 | |
Deferred income tax expenses | 9,324 | $ 1,352 | |
Total | ¥ 9,751 | $ 1,414 | ¥ 59,527 |
INCOME TAX- Schedule of Reconci
INCOME TAX- Schedule of Reconciliation Between The PRC Statutory Income Tax Rate and Effective Income Tax Rate (Details) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation Between The PRC Statutory Income Tax Rate and Effective Income Tax Rate | |||
PRC statutory income tax rate | 25% | 25% | 25% |
Effect of tax-exempt entities and tax rates in different jurisdictions | (21.95%) | (37.89%) | (15.82%) |
Effect of preferential tax rates | (10.43%) | 5.15% | (3.36%) |
Effect of permanent difference* | (11.00%) | 1.24% | 2.22% |
Changes in valuation allowance | 16.63% | (8.38%) | (7.89%) |
Others | 10.08% | 9% | (0.15%) |
Effective tax rate | 8.33% | (5.88%) |
INCOME TAX - Schedule of Deferr
INCOME TAX - Schedule of Deferred Tax Assets and Liabilities (Details) - CNY (¥) ¥ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Components of Deferred Tax Assets | ||||
Deductible advertising expenses | ¥ 272,810 | ¥ 262,801 | ||
Net operating loss carry-forwards | 94,704 | 70,985 | ||
Others | 58 | 1,062 | ||
Total deferred tax assets | 367,572 | 334,848 | ||
Less: valuation allowance | (354,306) | ¥ (334,848) | ¥ (250,032) | ¥ (175,757) |
Total deferred tax assets, net of valuation allowance | 13,266 | |||
Components of Deferred Tax Liabilities | ||||
Accelerated tax depreciation | (22,693) | |||
Identifiable intangible assets arising from business acquisition | (1,977) | |||
Total deferred tax liabilities | (24,670) | |||
Deferred tax liabilities, net of deferred tax assets | ¥ (11,404) |
INCOME TAX - Schedule of Moveme
INCOME TAX - Schedule of Movements of Valuation Allowance (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Valuation Allowance | |||
Balance at beginning of the year | ¥ 334,848 | ¥ 250,032 | ¥ 175,757 |
Change in valuation allowance | 19,458 | 84,816 | 74,275 |
Balance at end of the year | ¥ 354,306 | ¥ 334,848 | ¥ 250,032 |
ORDINARY SHARES (Details)
ORDINARY SHARES (Details) $ / shares in Units, ¥ in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | |||||||||||
Mar. 12, 2021 shares | Nov. 27, 2020 shares | Sep. 19, 2020 shares | Aug. 21, 2020 USD ($) shares | Mar. 31, 2022 USD ($) | Jun. 30, 2021 CNY (¥) shares | Mar. 31, 2021 $ / shares shares | Nov. 30, 2020 shares | Dec. 31, 2022 CNY (¥) shares | Dec. 31, 2022 USD ($) shares | Dec. 31, 2021 CNY (¥) shares | Dec. 31, 2020 CNY (¥) | Feb. 10, 2020 shares | |
ORDINARY SHARES | |||||||||||||
Proceeds from Issuance of common stock | ¥ | ¥ 78,998 | ||||||||||||
Proceeds from the US IPO, net of issuance cost | ¥ | ¥ 6,406,872 | ||||||||||||
Repurchase value of stock | ¥ | ¥ 918,894 | ||||||||||||
Common Class A | |||||||||||||
ORDINARY SHARES | |||||||||||||
Conversion of convertible redeemable preferred shares, Shares | 551,352,134 | ||||||||||||
Common stock shares issued | 749,323,103 | 749,323,103 | 748,953,103 | ||||||||||
Common stock shares outstanding | 724,582,975 | 724,582,975 | 727,855,233 | ||||||||||
Common stock voting rights | one | one | |||||||||||
Common Class B | |||||||||||||
ORDINARY SHARES | |||||||||||||
Common stock shares issued | 140,830,401 | 140,830,401 | 140,830,401 | ||||||||||
Common stock shares outstanding | 140,830,401 | 140,830,401 | 140,830,401 | ||||||||||
Common stock voting rights | ten | ten | |||||||||||
Share repurchase program | |||||||||||||
ORDINARY SHARES | |||||||||||||
Stock repurchase program, authorized amount | $ | $ 150,000 | ||||||||||||
Stock repurchase program, period in force | 12 months | ||||||||||||
Repurchase value of stock | ¥ 918,900 | $ 131,200 | |||||||||||
Share repurchase program | Common Class A | |||||||||||||
ORDINARY SHARES | |||||||||||||
Repurchase of ordinary shares (in shares) | 17,645,098 | 17,645,098 | |||||||||||
Share repurchase program | American Depositary Shares | |||||||||||||
ORDINARY SHARES | |||||||||||||
Repurchase of ordinary shares (in shares) | 8,822,549 | 8,822,549 | |||||||||||
IPO | Common Class A | |||||||||||||
ORDINARY SHARES | |||||||||||||
Number of new stock issued during the period | 110,400,000 | ||||||||||||
Proceeds from the US IPO, net of issuance cost | ¥ | ¥ 6,406,872 | ||||||||||||
Coatue PE Asia 26 LLC | Common Class A | |||||||||||||
ORDINARY SHARES | |||||||||||||
Number of new stock issued during the period | 4,122,853 | ||||||||||||
Proceeds from Issuance of common stock | $ | $ 11,431 | ||||||||||||
TWL Fellows Holding Limited | Treasury shares | |||||||||||||
ORDINARY SHARES | |||||||||||||
Issuance of Class A ordinary shares | 3,657,853 | ||||||||||||
TECHWOLF LIMITED | Common Class B | |||||||||||||
ORDINARY SHARES | |||||||||||||
Number of shares issued and outstanding of re-designated | 100,080,000 | ||||||||||||
Number of new stock issued during the period | 24,780,971 | 24,745,531 | 24,780,971 | ||||||||||
Number of shares transferred and converted into class A ordinary shares, first new investor | 1,965,361 | ||||||||||||
Number of shares transferred and converted into class A ordinary shares, second new investor | 1,876,467 | ||||||||||||
Number Of Shares Transferred And Redesignated To Class A Ordinary Shares | 3,752,934 | ||||||||||||
Number of shares repurchased | 1,181,339 | ||||||||||||
Repurchase price per share | $ / shares | $ 5.33 |
CONVERTIBLE REDEEMABLE PREFER_3
CONVERTIBLE REDEEMABLE PREFERRED SHARES - Schedule of convertible redeemable preferred share (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||||||||
Nov. 27, 2020 shares | Feb. 10, 2020 shares | Dec. 18, 2018 shares | Nov. 02, 2017 shares | Apr. 08, 2015 shares | Dec. 16, 2014 shares | May 20, 2014 shares | Dec. 31, 2021 CNY (¥) shares | Dec. 31, 2021 USD ($) shares | Dec. 31, 2020 CNY (¥) shares | Dec. 31, 2020 USD ($) shares | |
Series A Convertible Redeemable Preferred Stock | |||||||||||
CONVERTIBLE REDEEMABLE PREFERRED SHARES | |||||||||||
Balance beginning | ¥ 36,177 | ¥ 33,434 | |||||||||
Balance beginning, Shares | shares | 60,000,000 | 60,000,000 | 60,000,000 | 60,000,000 | |||||||
Issuance of preferred shares, shares | shares | 60,000,000 | ||||||||||
Accretion on convertible redeemable preferred shares to redemption value | ¥ 1,057 | ¥ 2,743 | |||||||||
Conversion of preferred shares to ordinary shares | ¥ (37,234) | ||||||||||
Conversion of preferred shares to ordinary shares, Shares | shares | (60,000,000) | (60,000,000) | |||||||||
Balance ending, Shares | shares | 60,000,000 | 60,000,000 | |||||||||
Balance ending | ¥ 36,177 | ||||||||||
Series B convertible redeemable preferred shares | |||||||||||
CONVERTIBLE REDEEMABLE PREFERRED SHARES | |||||||||||
Balance beginning | ¥ 67,976 | ¥ 62,785 | |||||||||
Balance beginning, Shares | shares | 40,000,000 | 40,000,000 | 40,000,000 | 40,000,000 | |||||||
Issuance of preferred shares, shares | shares | 26,666,667 | ||||||||||
Accretion on convertible redeemable preferred shares to redemption value | ¥ 2,006 | ¥ 5,191 | |||||||||
Conversion of preferred shares to ordinary shares | ¥ (69,982) | ||||||||||
Conversion of preferred shares to ordinary shares, Shares | shares | (40,000,000) | (40,000,000) | |||||||||
Balance ending, Shares | shares | 40,000,000 | 40,000,000 | |||||||||
Balance ending | ¥ 67,976 | ||||||||||
Series C convertible redeemable preferred shares | |||||||||||
CONVERTIBLE REDEEMABLE PREFERRED SHARES | |||||||||||
Balance beginning | ¥ 478,565 | ¥ 443,367 | |||||||||
Balance beginning, Shares | shares | 147,068,133 | 147,068,133 | 147,068,133 | 147,068,133 | |||||||
Issuance of preferred shares, shares | shares | 48,000,000 | ||||||||||
Accretion on convertible redeemable preferred shares to redemption value | ¥ 13,580 | ¥ 35,198 | |||||||||
Conversion of preferred shares to ordinary shares | ¥ (492,145) | ||||||||||
Conversion of preferred shares to ordinary shares, Shares | shares | (147,068,133) | (147,068,133) | |||||||||
Balance ending, Shares | shares | 147,068,133 | 147,068,133 | |||||||||
Balance ending | ¥ 478,565 | ||||||||||
Series D convertible redeemable preferred shares | |||||||||||
CONVERTIBLE REDEEMABLE PREFERRED SHARES | |||||||||||
Balance beginning | ¥ 380,782 | ¥ 352,586 | |||||||||
Balance beginning, Shares | shares | 60,856,049 | 60,856,049 | 60,856,049 | 60,856,049 | |||||||
Issuance of preferred shares, shares | shares | 60,856,049 | ||||||||||
Accretion on convertible redeemable preferred shares to redemption value | ¥ 10,823 | ¥ 28,196 | |||||||||
Conversion of preferred shares to ordinary shares | ¥ (391,605) | ||||||||||
Conversion of preferred shares to ordinary shares, Shares | shares | (60,856,049) | (60,856,049) | |||||||||
Balance ending, Shares | shares | 60,856,049 | 60,856,049 | |||||||||
Balance ending | ¥ 380,782 | ||||||||||
Series E convertible redeemable preferred shares | |||||||||||
CONVERTIBLE REDEEMABLE PREFERRED SHARES | |||||||||||
Balance beginning | ¥ 1,845,033 | ¥ 1,711,329 | |||||||||
Balance beginning, Shares | shares | 144,073,367 | 144,073,367 | 144,073,367 | 144,073,367 | |||||||
Issuance of preferred shares, shares | shares | 83,474,263 | ||||||||||
Accretion on convertible redeemable preferred shares to redemption value | ¥ 51,072 | ¥ 133,704 | |||||||||
Conversion of preferred shares to ordinary shares | ¥ (1,896,105) | ||||||||||
Conversion of preferred shares to ordinary shares, Shares | shares | (144,073,367) | (144,073,367) | |||||||||
Balance ending, Shares | shares | 144,073,367 | 144,073,367 | |||||||||
Balance ending | ¥ 1,845,033 | ||||||||||
Series F convertible redeemable preferred shares | |||||||||||
CONVERTIBLE REDEEMABLE PREFERRED SHARES | |||||||||||
Balance beginning | ¥ 2,882,063 | ||||||||||
Balance beginning, Shares | shares | 99,354,585 | 99,354,585 | |||||||||
Issuance of preferred shares | ¥ 2,803,114 | ||||||||||
Issuance of preferred shares, shares | shares | 50,664,609 | 48,689,976 | 99,354,585 | 99,354,585 | |||||||
Accretion on convertible redeemable preferred shares to redemption value | ¥ 85,527 | ¥ 78,949 | |||||||||
Conversion of preferred shares to ordinary shares | ¥ (2,967,590) | ||||||||||
Conversion of preferred shares to ordinary shares, Shares | shares | (99,354,585) | (99,354,585) | |||||||||
Balance ending, Shares | shares | 99,354,585 | 99,354,585 | |||||||||
Balance ending | ¥ 2,882,063 | ||||||||||
Convertible Redeemable Preferred Stock | |||||||||||
CONVERTIBLE REDEEMABLE PREFERRED SHARES | |||||||||||
Balance beginning | ¥ 5,690,596 | ¥ 2,603,501 | |||||||||
Balance beginning, Shares | shares | 551,352,134 | 551,352,134 | 451,997,549 | 451,997,549 | |||||||
Issuance of preferred shares | ¥ 2,803,114 | ||||||||||
Issuance of preferred shares, shares | shares | 99,354,585 | 99,354,585 | |||||||||
Accretion on convertible redeemable preferred shares to redemption value | ¥ 164,065 | $ 25,284 | ¥ 283,981 | $ 41,546 | |||||||
Conversion of preferred shares to ordinary shares | ¥ (5,854,661) | ||||||||||
Conversion of preferred shares to ordinary shares, Shares | shares | (551,352,134) | (551,352,134) | |||||||||
Balance ending, Shares | shares | 551,352,134 | 551,352,134 | |||||||||
Balance ending | ¥ 5,690,596 |
CONVERTIBLE REDEEMABLE PREFER_4
CONVERTIBLE REDEEMABLE PREFERRED SHARES (Details) ¥ in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | |||||||||||||||||
Nov. 27, 2020 USD ($) shares | Feb. 10, 2020 USD ($) shares | Jul. 04, 2019 USD ($) shares | Mar. 08, 2019 USD ($) shares | Dec. 18, 2018 USD ($) shares | Nov. 02, 2017 USD ($) shares | Feb. 10, 2017 USD ($) shares | Aug. 15, 2016 USD ($) shares | Jul. 07, 2016 USD ($) shares | Apr. 08, 2015 USD ($) shares | Dec. 16, 2014 USD ($) shares | May 20, 2014 USD ($) shares | Jun. 30, 2021 shares | Dec. 31, 2022 | Dec. 31, 2021 CNY (¥) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 CNY (¥) shares | Dec. 31, 2020 USD ($) shares | Dec. 31, 2019 shares | |
Temporary Equity [Line Items] | |||||||||||||||||||
Proceeds from Issuance of Redeemable Convertible Preferred Stock | ¥ | ¥ 2,803,114 | ||||||||||||||||||
Common Class A | |||||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||||
Conversion of preferred shares to ordinary shares, Shares | shares | 551,352,134 | ||||||||||||||||||
Series A Convertible Redeemable Preferred Stock | |||||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||||
Temporary Equity, Shares Outstanding | shares | 60,000,000 | 60,000,000 | 60,000,000 | ||||||||||||||||
Temporary equity issued during the period shares | shares | 60,000,000 | ||||||||||||||||||
Proceeds from Issuance of Redeemable Convertible Preferred Stock | $ 3,000 | ||||||||||||||||||
Stock issuance costs | $ 20 | ||||||||||||||||||
Accretion on convertible redeemable preferred shares to redemption value | ¥ | ¥ 1,057 | ¥ 2,743 | |||||||||||||||||
Series B Convertible Redeemable Preferred Stock | |||||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||||
Temporary Equity, Shares Outstanding | shares | 40,000,000 | 40,000,000 | 40,000,000 | ||||||||||||||||
Temporary equity issued during the period shares | shares | 26,666,667 | ||||||||||||||||||
Proceeds from Issuance of Redeemable Convertible Preferred Stock | $ 4,000 | ||||||||||||||||||
Stock issuance costs | $ 41 | ||||||||||||||||||
Accretion on convertible redeemable preferred shares to redemption value | ¥ | 2,006 | ¥ 5,191 | |||||||||||||||||
Series B Convertible Redeemable Preferred Stock | TECHWOLF LIMITED | |||||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||||
Temporary equity issued during the period shares | shares | 13,333,333 | ||||||||||||||||||
Series E Redeemable Convertible Preferred Stock | |||||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||||
Temporary Equity, Shares Outstanding | shares | 144,073,367 | 144,073,367 | 144,073,367 | ||||||||||||||||
Temporary equity issued during the period shares | shares | 83,474,263 | ||||||||||||||||||
Proceeds from Issuance of Redeemable Convertible Preferred Stock | $ 130,000 | ||||||||||||||||||
Stock issuance costs | $ 3,376 | ||||||||||||||||||
Accretion on convertible redeemable preferred shares to redemption value | ¥ | 51,072 | ¥ 133,704 | |||||||||||||||||
Series E Redeemable Convertible Preferred Stock | Tranche One | |||||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||||
Temporary equity issued during the period shares | shares | 32,373,031 | ||||||||||||||||||
Proceeds from Issuance of Redeemable Convertible Preferred Stock | $ 55,000 | ||||||||||||||||||
Stock issuance costs | $ 1,982 | ||||||||||||||||||
Series E Redeemable Convertible Preferred Stock | Tranche Two | |||||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||||
Temporary equity issued during the period shares | shares | 28,226,073 | ||||||||||||||||||
Proceeds from Issuance of Redeemable Convertible Preferred Stock | $ 50,000 | ||||||||||||||||||
Stock issuance costs | $ 1,917 | ||||||||||||||||||
Series C Convertible Redeemable Preferred Stock | |||||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||||
Temporary Equity, Shares Outstanding | shares | 147,068,133 | 147,068,133 | 147,068,133 | ||||||||||||||||
Temporary equity issued during the period shares | shares | 48,000,000 | ||||||||||||||||||
Proceeds from Issuance of Redeemable Convertible Preferred Stock | $ 10,000 | ||||||||||||||||||
Stock issuance costs | $ 40 | ||||||||||||||||||
Accretion on convertible redeemable preferred shares to redemption value | ¥ | 13,580 | ¥ 35,198 | |||||||||||||||||
Series C Convertible Redeemable Preferred Stock | Tranche One | |||||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||||
Temporary equity issued during the period shares | shares | 45,319,316 | ||||||||||||||||||
Proceeds from Issuance of Redeemable Convertible Preferred Stock | $ 12,508 | ||||||||||||||||||
Stock issuance costs | $ 86 | ||||||||||||||||||
Series C Convertible Redeemable Preferred Stock | Tranche Two | |||||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||||
Temporary equity issued during the period shares | shares | 42,251,744 | ||||||||||||||||||
Proceeds from Issuance of Redeemable Convertible Preferred Stock | $ 18,000 | ||||||||||||||||||
Stock issuance costs | $ 100 | ||||||||||||||||||
Series C Convertible Redeemable Preferred Stock | Tranche Three | |||||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||||
Temporary equity issued during the period shares | shares | 11,497,073 | ||||||||||||||||||
Proceeds from Issuance of Redeemable Convertible Preferred Stock | $ 6,001 | ||||||||||||||||||
Stock issuance costs | $ 32 | ||||||||||||||||||
Series D Convertible Redeemable Preferred Stock | |||||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||||
Temporary Equity, Shares Outstanding | shares | 60,856,049 | 60,856,049 | 60,856,049 | ||||||||||||||||
Temporary equity issued during the period shares | shares | 60,856,049 | ||||||||||||||||||
Proceeds from Issuance of Redeemable Convertible Preferred Stock | $ 43,394 | ||||||||||||||||||
Stock issuance costs | $ 1,132 | ||||||||||||||||||
Accretion on convertible redeemable preferred shares to redemption value | ¥ | 10,823 | ¥ 28,196 | |||||||||||||||||
Series F Convertible Redeemable Preferred Stock | |||||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||||
Temporary Equity, Shares Outstanding | shares | 99,354,585 | 99,354,585 | |||||||||||||||||
Temporary equity issued during the period shares | shares | 50,664,609 | 48,689,976 | 99,354,585 | 99,354,585 | |||||||||||||||
Proceeds from Issuance of Redeemable Convertible Preferred Stock | $ 270,000 | $ 150,000 | |||||||||||||||||
Stock issuance costs | $ 3,080 | $ 1 | |||||||||||||||||
Accretion on convertible redeemable preferred shares to redemption value | ¥ | 85,527 | ¥ 78,949 | |||||||||||||||||
Convertible Redeemable Preferred Stock | |||||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||||
Temporary Equity, Shares Outstanding | shares | 551,352,134 | 551,352,134 | 451,997,549 | ||||||||||||||||
Temporary equity issued during the period shares | shares | 99,354,585 | 99,354,585 | |||||||||||||||||
Preferred Stock convertible, conversion ratio | 1 | ||||||||||||||||||
Temporary equity liquidation preference per share percentage | 100% | ||||||||||||||||||
Threshold shareholding percentage required for redemption notice | 50% | ||||||||||||||||||
Accretion on convertible redeemable preferred shares to redemption value | ¥ 164,065 | $ 25,284 | ¥ 283,981 | $ 41,546 | |||||||||||||||
Convertible Redeemable Preferred Stock | Debt Note to Redeeming Shareholder | |||||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||||
Debt instrument term | 2 years | ||||||||||||||||||
Debt instrument interest rate | 10% | ||||||||||||||||||
Convertible Redeemable Preferred Stock | Prior to Issuance of Series F Redeemable Convertible Preferred Stock | |||||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||||
Temporary equity redemption price compound interest per annum | 10% | 10% | |||||||||||||||||
Redeemable convertible preferred stock initial Redemption start date | Jul. 05, 2024 | ||||||||||||||||||
Convertible Redeemable Preferred Stock | Post Issuance of Series F Redeemable Convertible Preferred Stock | |||||||||||||||||||
Temporary Equity [Line Items] | |||||||||||||||||||
Temporary equity redemption price simple interest per annum | 8% | 8% | |||||||||||||||||
Redeemable convertible preferred stock modified Redemption start date | Feb. 10, 2025 |
SHARE-BASED COMPENSATION - Sche
SHARE-BASED COMPENSATION - Schedule of Stock Option Activity (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Number of options | ||||
Outstanding beginning balance | 82,475,968 | 107,133,353 | 86,221,721 | |
Granted | 8,424 | 32,710,153 | 26,509,592 | |
Exercised | (12,413,256) | (54,385,484) | (5,597,960) | |
Forfeited | (1,709,938) | (2,982,054) | ||
Outstanding ending balance | 68,361,198 | 82,475,968 | 107,133,353 | 86,221,721 |
Vested and expected to vest as of December 31, 2022 | 68,361,198 | |||
Exercisable as of December 31, 2022 | 32,268,060 | |||
Weighted average exercise price | ||||
Outstanding beginning balance | $ 2.71 | $ 1.16 | $ 0.76 | |
Granted | 0 | 4.14 | 2.42 | |
Forfeited | 3.39 | 1.98 | ||
Exercised | 1.59 | 0.55 | 1 | |
Outstanding ending balance | 2.90 | $ 2.71 | $ 1.16 | $ 0.76 |
Vested and expected to vest as of December 31, 2022 | 2.90 | |||
Exercisable as of December 31, 2022 | $ 2.08 | |||
Weighted average remaining contractual life | ||||
Outstanding ending | 7 years 2 months 23 days | 8 years 18 days | 6 years 10 months 2 days | 7 years 2 months 19 days |
Vested and expected to vest as of December 31, 2022 | 7 years 2 months 23 days | |||
Exercisable as of December 31, 2022 | 6 years 6 months 3 days | |||
Aggregate intrinsic value | ||||
Outstanding ending Balance | $ 498,336 | $ 1,214,916 | $ 226,639 | $ 65,994 |
Vested and expected to vest as of December 31, 2022 | 498,336 | |||
Exercisable as of December 31, 2022 | $ 261,387 | |||
Weighted average grant-date fair value | ||||
Outstanding ending Balance | $ 2.99 | $ 2.82 | $ 0.64 | $ 0.27 |
Vested and expected to vest as of December 31, 2022 | 2.99 | |||
Exercisable as of December 31, 2022 | 1.69 | |||
Exercise price | 0.0001 | |||
Grant-date fair value | $ 12.13 |
SHARE-BASED COMPENSATION - Sc_2
SHARE-BASED COMPENSATION - Schedule of Assumptions in the Binomial Option-Pricing Model used to Determine the Fair Value of Stock Options (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
SHARE-BASED COMPENSATION | ||
Expected term (in years) | 10 years | 10 years |
Expected dividend yield | 0% | 0% |
Maximum | ||
SHARE-BASED COMPENSATION | ||
Fair value of ordinary shares on the date of option grant (US$) | $ 18.09 | $ 3.27 |
Risk-free interest rate | 2% | 1.70% |
Expected volatility | 59.80% | 59% |
Expected early exercise multiple | 2.8x | 2.8x |
Minimum | ||
SHARE-BASED COMPENSATION | ||
Fair value of ordinary shares on the date of option grant (US$) | $ 6.78 | $ 1.84 |
Risk-free interest rate | 1.60% | 0.82% |
Expected volatility | 58.80% | 56.50% |
Expected early exercise multiple | 2.2x | 2.2x |
SHARE-BASED COMPENSATION - Sc_3
SHARE-BASED COMPENSATION - Schedule of RSU activity (Details) - Restricted Stock Units (RSUs) - $ / shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Number of RSUs | ||
Outstanding beginning balance | 3,521,118 | |
Granted | 19,686,470 | 3,521,118 |
Vested | (1,959,584) | |
Forfeited | (435,058) | |
Outstanding ending balance | 20,812,946 | 3,521,118 |
Weighted Average Grant Date Fair value, outstanding as of December 31 | $ 11.23 | $ 19.05 |
SHARE-BASED COMPENSATION - Sc_4
SHARE-BASED COMPENSATION - Schedule of Stock-Based Compensation Expense (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
SHARE-BASED COMPENSATION | |||
Share-based Payment arrangement, expense | ¥ 692,204 | ¥ 1,923,646 | ¥ 657,236 |
Cost of revenues | |||
SHARE-BASED COMPENSATION | |||
Share-based Payment arrangement, expense | 39,587 | 31,467 | 1,920 |
Sales and marketing expenses | |||
SHARE-BASED COMPENSATION | |||
Share-based Payment arrangement, expense | 170,366 | 73,733 | 21,473 |
Research and development expenses | |||
SHARE-BASED COMPENSATION | |||
Share-based Payment arrangement, expense | 284,323 | 137,820 | 30,883 |
General and administrative expenses | |||
SHARE-BASED COMPENSATION | |||
Share-based Payment arrangement, expense | ¥ 197,928 | ¥ 1,680,626 | ¥ 602,960 |
SHARE-BASED COMPENSATION - Sc_5
SHARE-BASED COMPENSATION - Schedule of Stock-Based Compensation Expense (Parenthetical) (Details) - CNY (¥) ¥ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Nov. 27, 2020 | Jun. 30, 2021 | Nov. 30, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
SHARE-BASED COMPENSATION | ||||||
Share-based Payment arrangement, expense | ¥ 692,204 | ¥ 1,923,646 | ¥ 657,236 | |||
General and administrative expenses | ||||||
SHARE-BASED COMPENSATION | ||||||
Share-based Payment arrangement, expense | ¥ 197,928 | 1,680,626 | 602,960 | |||
TECHWOLF LIMITED | Class B ordinary shares | ||||||
SHARE-BASED COMPENSATION | ||||||
Number of new stock issued during the period | 24,780,971 | 24,745,531 | 24,780,971 | |||
TECHWOLF LIMITED | General and administrative expenses | ||||||
SHARE-BASED COMPENSATION | ||||||
Share-based Payment arrangement, expense | ¥ 1,506,400 | ¥ 533,100 |
SHARE-BASED COMPENSATION - Addi
SHARE-BASED COMPENSATION - Additional Disclosure (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
SHARE-BASED COMPENSATION | |||
Share-based awards granted | 8,424 | 32,710,153 | 26,509,592 |
Post-IPO Share Scheme | |||
SHARE-BASED COMPENSATION | |||
Share-based awards granted | 0 | ||
Share-based Payment Arrangement, Option | |||
SHARE-BASED COMPENSATION | |||
Share based payment arrangement nonvested award option cost not yet recognized amount | $ 115,900 | ||
Share based payment arrangement nonvested award cost not yet recognized period for recognition | 2 years 2 months 26 days | ||
Share-based Payment Arrangement, Option | Vested on Each Anniversary Of The Vesting Commencement Date For Four Years Thereafter | |||
SHARE-BASED COMPENSATION | |||
Share based Payment Award, Award Vesting Rights, Percentage | 25% | ||
Award Vesting Period | 4 years | ||
Share-based Payment Arrangement, Option | Vested on Each Anniversary Of The Vesting Commencement Date For Two Years Thereafter | |||
SHARE-BASED COMPENSATION | |||
Share based Payment Award, Award Vesting Rights, Percentage | 50% | ||
Award Vesting Period | 2 years | ||
Restricted Stock Units (RSUs) | |||
SHARE-BASED COMPENSATION | |||
Share based payment arrangement nonvested award cost not yet recognized period for recognition | 3 years 6 months | ||
Share based payment arrangement nonvested award excluding option cost not yet recognized amount | $ 214,322 | ||
Class A ordinary shares | 2020 Share Incentive Plan | |||
SHARE-BASED COMPENSATION | |||
Number of ordinary shares, share-based awards granted to purchase | 89,174,144 | ||
Class A ordinary shares | Post-IPO Share Scheme | |||
SHARE-BASED COMPENSATION | |||
Maximum number of shares that may be issued | 86,380,904 |
NET (LOSS)_INCOME PER SHARE - S
NET (LOSS)/INCOME PER SHARE - Schedule Of Basic And Diluted Loss Per Share (Details) ¥ / shares in Units, $ / shares in Units, ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 CNY (¥) ¥ / shares shares | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 CNY (¥) ¥ / shares shares | Dec. 31, 2020 CNY (¥) ¥ / shares shares | |
Numerator | ||||
Net (loss)/income | ¥ 107,245 | $ 15,548 | ¥ (1,071,074) | ¥ (941,895) |
Accretion on convertible redeemable preferred shares to redemption value | ¥ | (164,065) | (283,981) | ||
Net (loss)/income attributable to ordinary shareholders | ¥ 107,245 | $ 15,548 | ¥ (1,235,139) | ¥ (1,225,876) |
Weighted average number of ordinary shares used in computing net loss per share | ||||
- Basic | 868,941,151 | 868,941,151 | 529,343,027 | 111,172,986 |
Dilutive effect of share-based awards | 43,200,840 | 43,200,840 | ||
- Diluted | 912,141,991 | 912,141,991 | 529,343,027 | 111,172,986 |
Net loss per share attributable to ordinary shareholders | ||||
- Basic | (per share) | ¥ 0.12 | $ 0.02 | ¥ (2.33) | ¥ (11.03) |
- Diluted | (per share) | ¥ 0.12 | $ 0.02 | ¥ (2.33) | ¥ (11.03) |
NET (LOSS)_INCOME PER SHARE -_2
NET (LOSS)/INCOME PER SHARE - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Preferred shares | ||
Antidilutive Securities | ||
Antidilutive securities excluded from computation of earnings per share amount | 251,440,808 | 500,211,192 |
Stock compensation plan | ||
Antidilutive Securities | ||
Antidilutive securities excluded from computation of earnings per share amount | 78,376,179 | 60,853,313 |
RELATED PARTY BALANCES AND TR_3
RELATED PARTY BALANCES AND TRANSACTIONS - Schedule Of Transactions With Related Parties (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Related Party Transaction | |||
Related Party Transaction, Amounts of Transaction | ¥ 30,789 | ¥ 23,583 | ¥ 7,995 |
Settlement of amounts due from Mr. Peng Zhao and companies controlled by him | |||
Related Party Transaction | |||
Related Party Transaction, Amounts of Transaction | 31,132 | ||
Settlement of advance to individual executive officer | |||
Related Party Transaction | |||
Related Party Transaction, Amounts of Transaction | 5,093 | ||
Cloud services from Tencent Group | |||
Related Party Transaction | |||
Related Party Transaction, Amounts of Transaction | 26,256 | 18,119 | 6,109 |
On-line payment platform clearing services from Tencent Group | |||
Related Party Transaction | |||
Related Party Transaction, Amounts of Transaction | ¥ 4,533 | ¥ 5,464 | ¥ 1,886 |
RELATED PARTY BALANCES AND TR_4
RELATED PARTY BALANCES AND TRANSACTIONS - Schedule Of Amounts Due From Related Parties (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2022 CNY (¥) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 CNY (¥) |
Related Party Transaction | |||
Amounts due from related parties | ¥ 5,714 | $ 828 | ¥ 6,615 |
Receivables from Tencent Groups online payment platform | |||
Related Party Transaction | |||
Amounts due from related parties | 3,177 | 4,284 | |
Prepaid cloud service fee to Tencent Group | |||
Related Party Transaction | |||
Amounts due from related parties | ¥ 2,537 | ¥ 2,331 |
FAIR VALUE MEASUREMENT - Schedu
FAIR VALUE MEASUREMENT - Schedule Of Assets And Liabilities That Are Measured Or Disclosed At Fair Value On a Recurring Basis (Details) - Short-term Investments - Fair value - CNY (¥) ¥ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Assets: | ||
Short-term investments | ¥ 3,458,089 | ¥ 884,996 |
Significant other observable inputs (Level 2) | ||
Assets: | ||
Short-term investments | ¥ 3,458,089 | ¥ 884,996 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Thousands, ¥ in Millions | Nov. 10, 2022 USD ($) | Dec. 31, 2022 CNY (¥) |
Litigation Settlement [Abstract] | ||
Court granted preliminary approval of the parties settlement agreement | $ | $ 2,250 | |
Future minimum advertising commitments | ||
COMMITMENTS AND CONTINGENCIES | ||
Non cancellable contractual obligation | ¥ | ¥ 28 |
PROFIT APPROPRIATION AND REST_2
PROFIT APPROPRIATION AND RESTRICTED NET ASSETS (Details) ¥ in Thousands | 12 Months Ended |
Dec. 31, 2022 CNY (¥) | |
PROFIT APPROPRIATION AND RESTRICTED NET ASSETS | |
Restricted net assets | ¥ 938,000 |
Percentage of total restricted net assets to total consolidated net assets | 8.10% |
Appropriation to any reserve funds | ¥ 0 |
Foreign invested enterprise | General reserve fund | CHINA | |
PROFIT APPROPRIATION AND RESTRICTED NET ASSETS | |
Appropriation of after tax profit to general reserve fund required percentage minimum | 10% |
Required general reserve registered capital ratio to deforce compulsory net profit allocation to general reserve | 50% |
Domestic enterprise | Statutory surplus reserve | CHINA | |
PROFIT APPROPRIATION AND RESTRICTED NET ASSETS | |
Appropriation of after tax profit to statutory surplus fund required percentage minimum | 10% |
Required statutory surplus registered capital ratio to deforce compulsory net profit allocation to statutory surplus | 50% |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - ADR - Subsequent Event $ in Millions | 1 Months Ended |
Mar. 31, 2023 USD ($) | |
SUBSEQUENT EVENTS | |
Stock repurchase program, authorized amount | $ 150 |
Stock repurchase program, period in force | 12 months |