RLX Technology (NYSE:RLX) Releases Quarterly Earnings Results, Misses Expectations By $0.06 EPS

RLX Technology (NYSE:RLX) released its earnings results on Friday. The company reported $0.03 earnings per share for the quarter, missing analysts’ consensus estimates of $0.09 by ($0.06), FiscalAI reports. The firm had revenue of $148.73 million for the quarter, compared to analysts’ expectations of $173.99 million. RLX Technology had a net margin of 20.76% and a return on equity of 6.15%.

Here are the key takeaways from RLX Technology’s conference call:

• Q2 revenue rose 14.8% year over year to RMB 1.01 billion, while gross profit increased 47.8% to RMB 357.8 million. Gross margin expanded to 35.4%, supported by supply-chain optimization, manufacturing yields, and favorable product mix.
• International markets accounted for approximately 70% of revenue and remained the primary growth engine. The Western European distribution acquisition will be fully consolidated beginning in Q3, providing access to more than 30,000 retail endpoints and over 20,000 independent merchants through its B2B platform.
• Sequential revenue moderated as trade inventories normalized after Q1 shipments were pulled forward by regulatory export adjustments. Management also expects gross margin to settle into a more balanced range, while the lower-margin distribution business will dilute percentage margins despite increasing absolute operating profit and net income.
• RLX reported RMB 13.9 billion in cash and liquid resources and plans to prioritize high-return organic investments, selective accretive M&A, share repurchases, and dividends, subject to board approval. Management emphasized that acquisitions must be strategically synergistic, cash-payback oriented, non-dilutive, and EPS-accretive.
• The company is limiting near-term U.S. investment until PMTA enforcement becomes more predictable, while forecasting Mainland China sales to be broadly flat for the full year amid stricter regulatory approvals. Growth priorities are shifting toward Europe, Asia, and modern oral nicotine pouches, supported by a planned Southeast Asian multi-category manufacturing hub.

RLX Technology Price Performance

Shares of RLX stock traded down $0.04 during mid-day trading on Friday, hitting $1.96. The company had a trading volume of 8,777,373 shares, compared to its average volume of 2,433,973. The stock’s 50 day moving average price is $1.96 and its 200-day moving average price is $2.13. RLX Technology has a 52-week low of $1.76 and a 52-week high of $2.84. The company has a market capitalization of $3.03 billion, a P/E ratio of 19.55 and a beta of 1.20.

Analyst Upgrades and Downgrades

Separately, Weiss Ratings reiterated a “hold (c)” rating on shares of RLX Technology in a research note on Friday, July 17th. Two investment analysts have rated the stock with a Hold rating, Based on data from MarketBeat, the company has a consensus rating of “Hold” and an average target price of $2.50.

Institutional Trading of RLX Technology

A number of institutional investors and hedge funds have recently bought and sold shares of RLX. Mackenzie Financial Corp lifted its stake in RLX Technology by 40.4% in the 4th quarter. Mackenzie Financial Corp now owns 4,218,617 shares of the company’s stock worth $9,642,000 after purchasing an additional 1,214,766 shares in the last quarter. Canada Pension Plan Investment Board grew its position in shares of RLX Technology by 53.7% during the second quarter. Canada Pension Plan Investment Board now owns 3,804,284 shares of the company’s stock valued at $8,407,000 after purchasing an additional 1,329,500 shares in the last quarter. State Street Corp increased its holdings in shares of RLX Technology by 4.5% in the fourth quarter. State Street Corp now owns 3,275,082 shares of the company’s stock worth $7,630,000 after purchasing an additional 141,621 shares during the last quarter. Marshall Wace LLP increased its holdings in shares of RLX Technology by 82.4% in the third quarter. Marshall Wace LLP now owns 2,067,228 shares of the company’s stock worth $5,437,000 after purchasing an additional 934,135 shares during the last quarter. Finally, Mariner LLC lifted its position in shares of RLX Technology by 7,564.1% in the third quarter. Mariner LLC now owns 1,668,476 shares of the company’s stock worth $4,388,000 after buying an additional 1,646,706 shares in the last quarter. 22.68% of the stock is currently owned by institutional investors.

RLX Technology Company Profile

RLX Technology Inc (NYSE:RLX) is a China-based company specializing in electronic nicotine delivery systems. The company develops, manufactures and markets closed-pod vaping devices and prefilled cartridges, positioning its products as an alternative to traditional combustible tobacco. RLX emphasizes consistent nicotine delivery, flavor variety and convenience through its proprietary e-liquid formulations and device design.

RLX operates a vertically integrated business model that encompasses research and development, production, quality control and sales.