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

RLX Technology (NYSE:RLX) released its quarterly earnings results on Friday. The company reported $0.03 earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of $0.09 by ($0.06), FiscalAI reports. The company had revenue of $148.73 million for the quarter, compared to analyst estimates 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 Technology stock traded down $0.04 during trading hours on Friday, hitting $1.96. 8,778,373 shares of the company’s stock traded hands, compared to its average volume of 1,629,518. The company has a fifty day simple moving average of $1.96 and a 200-day simple moving average of $2.13. The stock has a market capitalization of $3.03 billion, a price-to-earnings ratio of 19.55 and a beta of 1.20. RLX Technology has a 12-month low of $1.76 and a 12-month high of $2.84.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently modified their holdings of RLX. Mackenzie Financial Corp lifted its position in shares of RLX Technology by 40.4% during the 4th quarter. Mackenzie Financial Corp now owns 4,218,617 shares of the company’s stock valued at $9,642,000 after buying an additional 1,214,766 shares during the last quarter. Empowered Funds LLC purchased a new stake in RLX Technology during the fourth quarter valued at about $167,000. XTX Topco Ltd boosted its position in RLX Technology by 152.6% during the fourth quarter. XTX Topco Ltd now owns 390,880 shares of the company’s stock worth $911,000 after purchasing an additional 236,153 shares during the period. Millennium Management LLC raised its position in shares of RLX Technology by 15.6% in the fourth quarter. Millennium Management LLC now owns 207,609 shares of the company’s stock valued at $484,000 after purchasing an additional 28,052 shares during the period. Finally, Capitolis Liquid Global Markets LLC purchased a new stake in shares of RLX Technology during the 4th quarter valued at approximately $3,519,000. 22.68% of the stock is owned by institutional investors.

Wall Street Analyst Weigh In

Separately, Weiss Ratings restated 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, RLX Technology has an average rating of “Hold” and an average target price of $2.50.

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.