Kanzhun Ltd (NASDAQ: BZ) reported second-quarter revenue of 2.4 billion yuan ($357 million), marking a 14.1% year-on-year increase. The recruitment platform operator signaled plans to expand its international operations into Brazil, Argentina, and Vietnam.

The result represents a rebound from the 7.6% growth recorded in the first quarter of 2026. Over the past three years, annual revenue growth has decelerated from 32% in 2023 to 24% in 2024 and 12.4% in 2025.

Financial Performance

Kanzhun’s cost of revenue grew by just 1.6% in the second quarter, significantly lagging the top-line expansion. This divergence contributed to improved gross and operating margins.

However, adjusted net income rose only 9.4% to 1.03 billion yuan, up from 941 million yuan a year earlier. The company attributed the muted profit growth to heavy marketing spending related to the World Cup.

International Expansion Strategy

The company is leveraging its OfferToday subsidiary for global growth. Launched in Hong Kong in 2024, the service became a leading platform there by late 2025 based on mobile daily active users.

Founder and Chairman Zhao Peng outlined a long-term horizon for new markets. He noted that entering a new market takes two to three years, with an additional five years required to reach $100 million to $115 million in revenue. Larger national markets, such as Brazil and Argentina, are described as "slow dishes" that may require 10 to 15 years to achieve similar revenue levels.

Domestic Market Dynamics

In China, Kanzhun continues to deepen its penetration among smaller cities and increase monetization. Key operational metrics for the trailing twelve months through June include:

• Total paying enterprise customers rose 11% YoY to 7.2 million.
• Average revenue per paying user (ARPPU) increased 7% in Q2.

The company serves approximately 300 million of China’s 500 million urban workers and has engaged 22 million enterprise customers since its inception.

What the Numbers Show

Revenue growth outpaced cost of revenue expansion by nearly nine percentage points (14.1% vs 1.6%). This leverage indicates strong operating efficiency gains, likely driven by economies of scale and AI-driven matching tools. However, the lower-than-revenue growth in adjusted net income (+9.4%) suggests that discretionary spending on marketing absorbed much of the margin benefit during the quarter.

Capital Allocation and Outlook

Kanzhun declared a $230 million dividend and has spent $300 million on share buybacks so far this year. The company forecasts third-quarter revenue growth between 11.4% and 15.6%.

Analysts remain broadly positive, with 21 of 23 polled rating the stock a "buy" or "strong buy." The company trades at a P/E ratio of 12.4, significantly lower than peers Recruit Holdings (50) and Robert Half (39).

Kanzhun Limited (NASDAQ: BZ) reported second-quarter 2026 adjusted earnings per share of $0.33, beating the analyst consensus estimate of $0.29 by 13.79%. Despite the earnings beat, quarterly sales of $353.51 million missed the consensus estimate of $355.28 million by 0.50%.

The results reflect accelerating growth in the online recruitment segment, supported by record user engagement and disciplined cost management despite significant marketing investments.

Financial Performance

Revenue reached RMB2,398.6 million (US$353.5 million), up from RMB2,102.4 million in the same quarter of 2025. The growth was driven primarily by the core online recruitment services business, which grew 14.7% to RMB2,384.0 million.

Operating costs and expenses increased modestly by 6.1% to RMB1,542.5 million, significantly lower than the revenue growth rate. This divergence drove a 5.0 percentage point expansion in the operating margin. Sales and marketing expenses rose 38.3% to RMB580.9 million, largely due to campaigns surrounding the 2026 FIFA World Cup sponsorship. General and administrative expenses fell 29.7% to RMB218.6 million, reflecting reduced employee-related costs.

Management highlighted that total share-based compensation expenses dropped by 19% year on year to RMB186 million, falling to 7.8% of revenue. The CFO noted that adjusted operating margin expanded by 1.9 percentage points year on year to a record high of 43.8%, driven by strong operating leverage and AI-enhanced efficiencies.

What the Numbers Show

GAAP net income surged 173.1% to RMB1,942.3 million, but this figure was heavily influenced by non-operational factors. Interest and investment income jumped from RMB157.0 million to RMB1,632.5 million, primarily due to a one-time gain of RMB1,466.1 million from fair value changes in an investee company following its IPO in January 2026. Excluding these non-recurring gains, adjusted net income grew more moderately by 9.4% to RMB1,029.2 million, indicating that core operational profitability expanded steadily rather than explosively.

User Metrics and Strategy

Average monthly active users (MAUs) on the BOSS Zhipin app surpassed 70 million for the first time, reaching 70.2 million, a 10.4% increase from 63.6 million in Q2FY25. Paid enterprise customers grew 10.8% to 7.2 million over the trailing twelve months ended June 30, 2026. The paying ratio among active enterprise users improved for the fourth consecutive quarter, while average revenue per paying user (ARPPU) increased 7% year on year.

Management announced a shift in growth strategies. For Tier 3, 4, and 5 cities, the core driver remains user penetration. In contrast, for Tier 1 and Tier 2 cities, the strategy focuses on increasing monetization through price increases and higher payment rates, leveraging improved user experience and AI-driven efficiency. CEO Jonathan Hong Cha noted that current pricing in major cities is extremely low, comparable to the cost of a bottle of mineral water per match, leaving significant room for revenue growth as companies recognize higher value in recruitment outcomes.

The company is also expanding its AI capabilities, with AI-enabled process business revenue growing rapidly quarter over quarter. AI-powered interviews and resume filtering are contributing to operational efficiencies and higher customer spending. The CFO stated that gross margin rose 1.6 percentage points to 87%, aided by stable headcount growth despite user expansion, as AI tools handle security verifications and customer service tasks.

Shareholder Returns and Outlook

Kanzhun declared an annual cash dividend of US$0.255 per ordinary share (US$0.510 per ADS), totaling approximately US$230 million. This follows over US$300 million in share buybacks completed year-to-date, representing roughly 4.6% of total outstanding shares. Cumulatively, the company has bought back over 10% of its total shares outstanding. Total shareholder returns for 2026 reached US$530 million, exceeding 100% of last year's adjusted net income.

As of June 30, 2026, the company’s cash position stood at RMB18.8 billion. For the third quarter of 2026, Kanzhun expects total revenues between RMB2.41 billion and RMB2.50 billion, representing an 11.4% to 15.6% year-on-year increase. Management expects margins in Q3 to remain similar to Q2 levels.