Waterdrop's Q1 2025 Earnings Call: Unpacking Contradictions in Insurance Growth and Profitability Trends

Insurance business growth and customer acquisition strategy, profitability trends, insurance business growth, insurance revenue growth rate are the key contradictions discussed in Waterdrop's latest 2025Q1 earnings call.



Revenue Growth and Profitability:
- Waterdrop reported revenue of over RMB 750 million in Q1 2025, up 7% year-over-year.
- Net profit attributable to the company's ordinary shareholders reached RMB 110 million, indicating a significant 34.2% year-over-year growth.
- This growth was driven by strong performance in the insurance business and strategic investment in AI technology.

Insurance Business Expansion:
- The insurance business achieved First-Year Premiums (FYP) of approximately RMB 2.09 billion, representing a 19.3% year-over-year growth.
- Insurance-related revenue reached about RMB 660 million, with an 8.4% year-over-year increase and 13% quarter-over-quarter growth.
- This expansion was supported by personalized marketing strategies, product innovation, and AI-driven improvements in customer service and insurance offerings.

AI and Technology Investments:
- Research and Development (R&D) expenses in Q1 totaled RMB 56 million, up by 3.6% from the previous quarter.
- Waterdrop's AI insurance expert facilitated 2 million in monthly premiums, contributing to operational efficiency improvements.
- The company's focus on AI and technology is aimed at enhancing service quality, developing new product lines, and driving business growth.

Charity and Social Responsibility:
- As of March 31, 2025, Waterdrop Charity platform has partnered with 117 public charitable organizations and launched over 15.5 value projects.
- The platform has actively responded to social needs, such as rapid response to the earthquake.
- Waterdrop remains committed to social responsibility and sustainable development to create shareholder value for society.

Dividend and Shareholder Returns:
- Waterdrop distributed its third cash dividend of $7.3 million and repurchased approximately 54.2 million ADS in the open market, totaling $1.07 million.
- These actions demonstrate the company's commitment to returning value to shareholders.
- The company anticipates revenue growth to continue, with a strategic focus on driving business growth through investments in AI and technology.