Fangdd Shares Surge Over 50% on Strong Revenue Growth
Chinese proptech firm reports a 45% jump in first-half sales, but swings to a net loss as margins tighten.
Shares of Fangdd Network Group (NASDAQ: DUO), a Chinese property technology company, skyrocketed over 53% after the company reported a significant surge in first-half revenue, even as it swung to a net loss.
The Shenzhen-based firm announced that revenue for the six months ending June 30, 2025, increased by 45.3% year-over-year to RMB203.4 million (US$28.4 million). The company attributed the strong top-line performance to supportive government policies and an improving real estate market in China. Total closed-loop Gross Merchandise Value (GMV) facilitated on its platform grew 27.3% to RMB8.0 billion (US$1.1 billion).
Despite the impressive sales growth, Fangdd reported a net loss of RMB39.2 million (US$5.5 million), a stark reversal from the net income of RMB16.4 million recorded in the same period of 2024. The company's profitability was squeezed by a decline in its gross margin, which fell to 9.1% from 12.5% a year earlier. This was primarily attributed to a lower contribution from higher-margin value-added services. Operating expenses also saw a modest increase of 4.8%.
In a statement, Mr. Xi Zeng, Chairman and CEO of FangDD, commented on the market dynamics. "In the first half of 2025, with continuous policy support, China's real estate market showed signs of stabilization despite ongoing adjustments," he noted, highlighting the company's focus on core projects and cooperation with reputable developers as key growth drivers.
Investors appeared to focus on the positive revenue trajectory and signs of a stabilizing property sector, triggering a massive rally in the company's stock on very high trading volume. The results present a mixed financial picture for Fangdd, which now faces the challenge of translating its market growth into sustainable profitability amid a still-recovering, and highly competitive, real estate landscape.