Zepp Health sales rise 33.8% in Q1, led by new product launches
Zepp Health Corporation reported unaudited financial results for the first quarter of 2026, with revenue rising 33.76% year-over-year to US$51.547 million. The company's adjusted net loss narrowed to US$17.9 million, while gross margin expanded to 37.7%. For the second quarter of 2026, management expects net revenues between US$63.0 million and US$68.0 million.
*this image is generated using AI for illustrative purposes only.
Zepp Health Corporation reported unaudited financial results for the first quarter of 2026, achieving revenue of US$51.547 million, which represents a 33.76% increase year-over-year from US$38.537 million. This growth was primarily driven by new product launches such as the Active Max, Active 3 Premium, and T-Rex Ultra 2. Despite the first quarter traditionally being a softer season for consumer electronics, the company's strategic focus on premiumization and product mix improvements supported the performance. The company reported an adjusted net loss per share of $(1.13), unchanged from the same period last year.
Financial Performance
Gross margin for the quarter stood at 37.7%, an expansion of 0.4 percentage points compared to the first quarter of 2025. The company reported a GAAP net loss of US$19.6 million and an adjusted net loss of US$17.9 million. While the company remains unprofitable, the adjusted operating loss narrowed to US$16.3 million from US$17.2 million in the prior year, reflecting improved operating leverage as revenue scales.
Key Financial Metrics
| Metric | Q1 2026 | Q1 2025 | Change |
|---|---|---|---|
| Revenue | US$51.547 million | US$38.537 million | +33.76% |
| Gross Profit | US$19.4 million | US$14.4 million | +35.3% |
| Gross Margin | 37.7% | 37.3% | +0.4 pp |
| Adjusted Operating Loss | (US$16.3 million) | (US$17.2 million) | Narrowed |
| Adjusted Net Loss | (US$17.9 million) | (US$18.1 million) | Narrowed |
Operational Highlights
The company continued to invest in research and development, with expenses rising to US$13.1 million from US$12.4 million in the prior year. Selling and marketing expenses increased to US$16.6 million, driven by frontloaded investments in branding activities and e-commerce platform charges proportional to sales growth. General and administrative expenses were US$7.4 million.
As of March 31, 2026, Zepp Health held cash and cash equivalents and restricted cash totaling US$103.2 million. Inventory levels decreased to US$62.8 million from US$72.8 million as of December 31, 2025, indicating improved inventory management. The company also announced it has cumulatively retired US$46.4 million of debt since the beginning of 2023.
Strategic Developments
During the quarter, Zepp Health expanded its product portfolio with the debut of several new devices, including the Amazfit Balance 3, Balance Ultra, Bip Max, Cheetah 2 Pro, and Cheetah 2 Ultra. The company also extended its partnership with HYROX through a new exclusive three-year global partnership, securing its position as the exclusive wearable technology partner for the fitness event.
Outlook
Looking ahead to the second quarter of 2026, management expects net revenues to be between US$63.0 million and US$68.0 million, representing an increase of approximately 6% to 14% year-over-year. This outlook accounts for normal shipment timing and product launch phasing while maintaining a focus on premiumization and long-term profitability.
What is the expected timeline for reaching profitability given the narrowing operating losses and continued revenue growth?
How will the increased marketing investments and HYROX partnership impact user acquisition costs in the upcoming quarters?
Will the current premiumization strategy sustain revenue growth once the initial demand for new product launches normalizes?
20
Create Custom Screeners 
Access 200+ Pre-built Filters 
Use 50+ Readymade Screener 
