KANZHUN Q4 2024 Earnings Report

KANZHUN EPS Results

• Actual EPS: N/A
• Consensus EPS: $0.21
• Beat/Miss: N/A
• One Year Ago EPS: N/A

KANZHUN Revenue Results

• Actual Revenue: N/A
• Expected Revenue: $1.80 billion
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

KANZHUN Announcement Details

• Quarter: Q4 2024
• Date: 3/11/2025
• Time: Before Market Opens
• Conference Call Date: Tuesday, March 11, 2025
• Conference Call Time: 8:00AM ET

KANZHUN (NASDAQ:BZ) Limited, through its flagship platform Boss Zhipin, operates one of China’s leading online recruitment and career development marketplaces. The company leverages a direct messaging interface to connect job seekers with employers in real time, offering an alternative to traditional resume submission and long hiring cycles. By integrating technology-driven matching algorithms, Kanzhun aims to streamline recruitment and deliver higher-quality candidate-employer interactions.

In addition to its core job-matching service, Kanzhun provides a suite of value-added solutions for corporate clients, including targeted employer branding campaigns, recruitment advertising, and talent assessment tools. These services enable organizations of all sizes to promote job openings, cultivate employer brand awareness, and evaluate candidate skills through online testing modules. The company also offers career coaching and upskilling programs designed to enhance candidate readiness and retention.

With operations primarily focused on Mainland China, Kanzhun’s platform serves a diverse range of industries—from technology and finance to manufacturing and consumer services. The company maintains a network of regional offices and customer support teams to address local market needs and regulatory requirements, ensuring compliance and responsiveness to both job seekers and hiring organizations across various provinces.

Founded in 2014 and headquartered in Beijing, Kanzhun completed its initial public offering on the Nasdaq Global Market in 2021. The company is led by a management team with deep experience in internet technology, human resources, and digital marketing. As it continues to invest in data analytics, artificial intelligence, and product innovation, Kanzhun seeks to expand its market presence and further enhance the efficiency of China’s online recruitment ecosystem.

KANZHUN Q4 2024 Earnings Call Transcript

Key Takeaways

• In Q4 the company reported GAAP revenue of RMB1.82 billion (up 15% YoY) and adjusted net income of RMB720 million (up 15%), while full-year 2024 revenue reached RMB7.36 billion (up 24%) and adjusted net income RMB2.71 billion (up 26%).
• Average monthly active users on the app rose 28% YoY to 52.7 million in Q4, and the company added a record 49.5 million new verified users in 2024, serving over 225 million users and 16.6 million enterprises by year-end.
• Revenue from blue collar segments climbed to 38% in 2024—led by manufacturing—while contributions from non-tier one cities and micro and small enterprises also grew, underscoring the success of the user-first expansion strategy.
• New AI capabilities include a Nanbei-powered Q&A job search and an interview coaching bot for job seekers, plus recruiter-side AI agents for candidate sourcing and outreach, which together have boosted security audit efficiency by 30%.
• Following Chinese New Year, daily new job postings jumped over 10% YoY and daily active users hit a historic ~20 million, with strong demand in manufacturing, logistics, automotive, healthcare, education and professional services.

Presentation

[Operator]

Ladies and gentlemen, thank you for standing by and welcome to Changjin Limited Fourth Quarter and Fiscal Year twenty twenty four Financial Results Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. Today's conference is being recorded. At this time, I would like to turn the conference over to Ms. Wunpei Wang, Head of Investor Relations. Please go ahead, ma'am.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

Thank you, operator. Good evening and good morning, everyone. Welcome to our first quarter and full year twenty twenty four earnings conference call. Joining me today are our Founder, Chairman and CEO, Mr. Jonathan Peng Zhao and our Director and CFO, Mr. Fuyu Zhang. Before we start, we would like to remind you that today's discussion may contain forward looking statements, which are based on management's current expectations and observations that involve known and unknown risks, uncertainties and other factors not under the company's control, which may cause actual results, performance or achievements of the company to be materially different. The company caution you not to place undue reliance on forward looking statements and do not undertake any obligation to update this forward looking information, except as required by law. During today's call, management will also discuss certain non GAAP financial measures for comparison purpose only. For definition of non GAAP financial measures and the reconciliation of GAAP to non GAAP financial results, please see the earnings release issued earlier today.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

In addition, a webcast replay of this conference call will be available on our website at ir.juping.com. With that, I will now turn the call to Jonathan, our Founder, Chairman and CEO. Hello, everyone. Thank you for joining our company's fourth quarter and the full year twenty twenty four earnings conference call. On behalf of the company's employees, management team and the Board of Directors, I would like to extend our sincere gratitude to our users and investors and friends who have continuously leading us and supported us.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

Let me first provide an overview of our financial performance. In the fourth quarter, the company achieved a GAAP revenue of RMB1.82 billion, up 15 year on year. Our adjusted net income, which excludes share based compensation expenses, reached RMB720 million, reflecting a 15% year on year growth. In the fourth quarter, average verified monthly active users or MAU on the bus shipping app increased by 28% year on year to 52,700,000. For the full year of 2024, the company achieved a GAAP revenue of RMB7.36 billion, up 24% year on year.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

Adjusted net income, which excludes share based compensation expenses, reached RMB2.71 billion, up 26% year on year. Furthermore, our adjusted operating income, excluding other income such as wealth management income was RMB2.32 billion for full year 2024, rising by 41% year on year and in 2024, we successfully delivered on our profit commitments. Share based compensation expenses as a percentage of revenue in 2024 decreased by 2.3 percentage points compared to 2023 and are expected to further decline in both absolute value and the proportion of revenue in 2025. In 2024, we attracted nearly 49,500,000 newly added verified users, setting a new record for annual user growth. At the same time, we reduced marketing expenses compared to 2023, thanks to our growing brand recognition and enhanced battery network effects, which have significantly improved customer acquisition efficiency.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

As of 12/31/2024, the company has provided service to over two twenty five million users and 16,600,000 enterprises. MAU on the Buzz Jupyin app for the full year reached RMB53 million, representing a year on year increase of 25.3%. In the year, we facilitated over RMB1.85 billion successful resume exchanges based on mutual consent between job seekers and employers, which is what we refer to as achievement in daily operation. Despite macro economy challenges in 2024, the company's user growth driven revenue growth model remains effective, driving notable improvement in both revenue scale and profitability. Some may argue that we are more beta driven business.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

However, I would like to emphasize that our base model is so much more than that. To date, user expansion has remained our core growth driver. The structural revenue growth driven by sustained user penetration is clearly reflected in the following key metrics. First, increasing revenue contribution from Blue Collar segments. Blue Collar's user growth boosted their revenue contribution to overall revenue in 2024 to 38%.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

Notably, the manufacturing sector emerged as a bright spot for blue collar growth, posting the fastest growth rate among all industries. Second, the revenue contribution from non tier one cities continues to grow. Third, the revenue contribution from micro and small enterprises continue to rise. Micro and small enterprises are defined as business with fewer than 20 employees. These revenue gains jump from structural shifts in user growth.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

At the core of this success is the company's commitment to enhancing the user experience, which is underpinned by our continuous product and the service optimization. It's not hard to imagine that within the online recruitment service industry, blue collar workers, particularly those in the manufacturing sector, lower tier cities and micro small enterprises are among the more challenging user groups to serve. Breakthroughs and growth in these areas would only validate our user first strategy, but also highlight the significant potential for our future user expansion and revenue growth. Additionally, we have observed that recruitment demand from white collar and large enterprises have stabilized. Enterprises with over 10,000 employees demonstrated the fastest quarter on quarter revenue growth in the fourth quarter.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

I want to highlight one more aspect of our products and services. Many investors in France have shown interest in the company's exploration of closed loop services initiatives, which we do have some progress. In 2024, the number of enterprises which we have provided placement and like service was near 40,000. In 2024, the total number of paid enterprise customers reached 6,100,000, representing a year on year increase of 17.3%, while the active user paying ratio remains stable. The average revenue per paying user or ARPU achieved year on year growth both for the full year and in the fourth quarter.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

Now let me introduce some AI implementation. We faced rollout in version 13.03 of the BOSS JITING app, which was released across major app stores around March 7. I'll start with our AI2C or AI4 job seekers side updates. First, on job seekers interaction for job search, we have added an AI powered question based search function, something many of you are likely already familiar with and also kept our traditional keyword search. The search engine is powered by both our proprietary model called Nanbei and the deployment of DeepSeq R1.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

And the second thing on the job seeker side is we have released an AI bot to help job seekers with interview coaching. This feature primarily targets those who have graduated within the past three years. This AI bot has been trained on millions of real interviews and his core skills is that he's very good at interviewing. And as such, there are lots of things he can do. We will go step by step.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

Now let's take a look at AI2 business, which is the recruiter side. Our first application for enterprise users is an AI agent. Recruiters participating in the beta testing can communicate their needs to the agent which can perform the following tasks. One, understand the recruiters' specific requirements. Two, generate a curated list of candidates from our database three, offer justification for its recommendations four, deliver these results according to the recruiters' available schedule.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

For the second application, a better version has been launched to a selected group of blue collar enterprise users. The process unfolds as follows. Once a recruiter selects a candidate, they deem suitable and explicitly expressed their willingness to proceed by saying, I'm willing to give this candidate a try. The AI handles all subsequent communication on behalf of the recruiter. The communication process continues until the AI either obtains the job seekers confirmation of interest through the exchange of contact information or the job seeker rejects the outreach of the recruiter who is represented by AI.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

On the operational front, AI has huge potential to improve management efficiency and reduce cost. For instance, leverage AI for security review has improved our audit efficiency by 30%. Over the past two years, as our user base have expanded rapidly, the workload related to user security protection has increased accordingly. However, AI has enabled us to manage this without a proportional increase in staffing. Next, I will briefly update you on this year's spring recruitment season.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

Following the spring festival, the recruitment market continued its steady recovery trend that began towards end of twenty twenty four. Post Chinese New Year in February, the company's key metrics including number of active users, active job postings and new job postings all reached historical highs. The average daily new job postings after Chinese New Year increased by more than 10% compared to the same period last year. Key daily active users on the Bosteping app reached approximately 20,000,000, which are also historical high. A very important highlight on the supply and demand side, the job seeker to enterprise user ratio among new users improved compared to the same period last year, extending the positive momentum that began in November 2024.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

From an industry perspective manufacturing, logistics, automotive, healthcare, education and professional services have exhibited strong performance. In terms of job tie, blue collar positions have grown faster due to our user expansion, while white collar roles have also demonstrated an improving year on year trend. Notably, since the spring festival, average daily posting of AI related jobs have surged by over 50% year on year, signaling our revitalized ecosystem for emerging business. This growth in AI related roles in turn has fueled good sequential momentum in demand for product and technical positions since the Spring Festival. Last but not least, we are very committed to shareholder returns.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

In 2024, the company repurchased approximately $229,000,000 worth of shares accounting for 3.7% of total outstanding shares. This underscores our confidence in the company's long term growth. And that concludes my part of the call. I will now turn it over to our CFO, Phil, for a review of our financials. Thank you.

[Yu Zhang, CFO & Executive Director at Kanzhun]

Thanks, Jonathan. Hello, everyone. Now let me walk through the details of our financial results of fourth quarter and full year of 2024. We delivered solid financial results for the fourth quarter and full year of 2024. The recruitment market environment in 2024 was challenging, but we are pleased to see that recruitment demand gradually stabilized towards the end of the year.

[Yu Zhang, CFO & Executive Director at Kanzhun]

Under such conditions, our revenues grew by 15% year on year to RMB1.8 billion during this quarter, slightly beating our expectation and grew by 24% to RMB7.4 billion for the full year. Our number of paid enterprise customers for 2024 expanded to 6,100,000, marking a 17% year on year growth. ARPU for the quarter was up by 6.8% year on year and 3.9% quarter on quarter, marking a fourth consecutive quarterly growth. ARPU for the full year reached RMB1.2 thousand, up by more than 5% year on year. It's a result of our efforts to explore customer needs and providing more valuable services.

[Yu Zhang, CFO & Executive Director at Kanzhun]

Moving to the cost and expenses side. Our total operating cost and expenses increased by 7% year on year to RMB1.5 billion during the fourth quarter and by 15% to RMB6.2 billion for the full year. Total share based compensation expenses decreased by 6% year on year in the quarter. As a percentage of revenue wise, share based compensation went down by four and two percentage points, respectively, for the quarter and the full year. Excluding share based compensation expenses, our adjusted income from operations grew by 27% to RMB659 billion and forty 1% to RMB2.3 billion respectively for the quarter and the full year.

[Yu Zhang, CFO & Executive Director at Kanzhun]

The adjusted operating margin for the fourth quarter reached a quarterly historical high of 36.1%, while the annual adjusted operating margins improved by four percentage points to 31.5% in 2024, continuing to demonstrate our strong operating leverage and beating our target. Cost of revenues increased by 14% year on year to RMB314 million during the fourth quarter and by 17% to RMB1.2 billion for the full year. This increase was primarily due to increases in payment processing cost, server and bandwidth cost and other business related cost alongside with the growth of revenue and user base. It's worth mentioning that operational employee related costs half percentage of revenue decreased by 0.9 percentage points year on year, an evidence of AI application to improve operating efficiency. As a result, our gross margin went up by 0.9% to 83.1% in 2024.

[Yu Zhang, CFO & Executive Director at Kanzhun]

Sales and marketing expenses decreased by 2% year on year to RMB426 million during this quarter and increased by 4% to RMB2.1 billion for the full year. Our marketing expenses, including Olinctive campaign sponsorship, decreased by 10% year on year despite a higher new user growth versus prior year. We believe this improving trend of user acquisition efficiency will continue in 2025 and led to a further decrease of our marketing expenses on both absolute amount and as percentage of revenue. R and D expenses increased by 2% year on year to RMB440 million this quarter and by 18% to RMB1.8 billion for the full year. This increase was primarily driven by our further investments in AI infrastructure, which incurred AI related server depreciation costs and cloud services fees.

[Yu Zhang, CFO & Executive Director at Kanzhun]

G and A expenses increased by 23% year on year to RMB276 million during this quarter and by 35% to RMB1.1 billion for the full year. This increase was mainly due to increased employee related expenses and investment in new business initiatives. Our net income reached RMB444 million in the quarter and RMB1.6 billion in 2024. Our adjusted net income increased by 15% year on year to RMB722 million in the fourth quarter and the 26% year on year to RMB2.7 billion for the full year. Our adjusted net margin continued to expand in the full year and reached a historical high of 36.9%.

[Yu Zhang, CFO & Executive Director at Kanzhun]

Net cash provided by operating activities amounted to RMB956 million during the fourth quarter and increased by 16% year on year to RMB3.5 billion for the full year. And our cash position stood at RMB14.7 billion as of 12/31/2024, though there was share buyback spendings. The robust cash reserves coupled with strong operating cash flows strategically positioned us well to support future growth initiatives and shareholder returns. During this quarter, we repurchased the 6,700,000.0 ADS for a total consideration of US93 million dollars This led to a 1.1% decrease in our total outstanding shares as compared to 09/30/2024, even after counting in shares issued for our share based awards. Combined with share repurchases in the preceding quarters, we have spent a total of US229 billion dollars for the share repurchases in 2024, representing substantial progress of our share repurchase programs.

[Yu Zhang, CFO & Executive Director at Kanzhun]

And now for our business outlook. For the first quarter of twenty twenty five, as we witnessed the recruitment spending bottoming out from last quarter and showing upswing trajectory post the Chinese New Year, we expect our total revenues to be between RMB1.9 billion and RMB1.92 billion, a year on year increase of 11.5% to 12.7%. With that, that concludes our prepared remarks. Now we would like to answer questions. Operator, please go ahead.

[Operator]

Thank you. We will now begin the question and answer session. We will now take our first question from the line of Eddie Huang from Morgan Stanley. Please ask your question, Eddie.

[Eddy Wang, Analyst at Morgan Stanley]

Thank you, management, for taking my question. I have two questions. The first one is that could you please share your thoughts on how the AI boom driven by the Deepsea might impact the online recruitment industry? And this includes the transformations in the industry technology and the products as well as its influence on the market recruitment demand, for example, the hiring surge in the tech industry. What's our competitive advantage in this context?

[Eddy Wang, Analyst at Morgan Stanley]

The second question is, we actually have made quite a significant investment in AI already. So with the emergency of DeepSeek, will this promote any adjustments to our AI and the investment strategy? And what is the our future roadmap for AI product development? Thank you.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

Thank you for your question. Let me first talk about the implication of the deep seek kind of on the online recruitment industry. First in the especially for the demand side, in short term, we do see some changes. For example, on the recruiter side, as I just mentioned, the daily average daily newly added AI ready jobs surged by more than 64%, which is quite rare. And also the existing jobs became more active.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

So the average daily online active job number of AI ready jobs increased by more than 24%, which is also quite a big number. On the Dopseeker side, of course, everyone was trying to looking for opportunities in this AI trend. So on the numbers, we found that the active search results, so active search keywords with AI increased by more than 34% year on year. And on the I believe these changes will deeply affect the future of the recruitment industry. I will talk about one positive side and maybe one slightly rapid side.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

On the positive side, this trend of AI is first initial usage is it has very strong understanding of human natural language and generate human natural language. And this is first form and can be easily be understanding. So when people starting to find a job, turning to the world, it will become a resume. And when the recruiter is trying to hire someone in the formatting of word, it will be a job description. So in terms of description, expression of resume and job description, this kind of wording format in front of AI is very simple and transparent and it's easy to understand this can be very deeply affected.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

And second one, on the next one is a concern, I will express with numbers. For example, on our platform, there are over 200,000,000 of AI generated resume and on the other side there are 14,000,000 of AI generated job description. So under such condition or circumstances, what is the meaning of the people behind all those resumes and JDs and what our machines are matching for. So this is not a new topic. Currently more and more people are using AI to search for results to write articles and there will be more and more AI made up, which is a historical fact that was not existed and with more than 1,000 times of repeat that will become a fact.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

So lot of things have been polluted. Now the massive pollution of resume or job description has not started yet. So we need to be alert and prepared for that. Xiaochuan. And after the deep seek moment, I have also been considering your question about what our advantage is and we believe I believe we do have some.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

First, we have been continuously investing in AI science in the past two years. We also have our own pre trained model Nambeiko, which is quite good. We have a lot of AI application scenarios and accumulated a lot of unique user behavior and very correlated data. So I think that's something we have facing this challenge of this moment. And your second question about our further investment in AI development, which I have always have been considering recently.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

So in early twenty twenty three, that type DPT moment two years ago since like AI have been a spring moment. So we have spent more than RMB1 billion on purchasing GPU with a lot of curiosity and a little bit fear. So currently we have stored enough computing power. Before the restriction order of our GPU purchasing, we have actually bought a lot of GPUs. But last year under the overall environment, we need to have more and more GPUs and bigger and bigger computing power.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

Under that situation, we are a little bit awkward in our technology investment. So we cannot buy more and we won't buy more. Actually DeepSeq has given us very high confidence in terms of the strategy of investment. So as Yijing have said, when challenges promote changes and changes will lead to progress. So in the past the biggest right and money means the future that situation has gone and the technology innovation has bring changes to many things.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

The open source of DIP6-671B have enabled a lot of middle sized Internet companies should have the same level of AI capability with other large companies. We are at the same starting line. So in the future, we will and many other companies will focus more on the AI application, AI agents and continue our explore in the AI science. And about our plan for our product roadmap, I talk a little bit about our current products and services and we will continue our exploration of AI application agents and you will see upcoming launch of new services. And on the revenue side, which you may concern more, so from the AI to recruiters, we have one product which have been there for more than one year and I think people might be interested to pay for that service, which can help increase the efficiency of achieving our mutual consent by 60% and saving the bosses time by more than 40%.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

I think this product should be welcomed by the recruiters. And that's my answer to your questions. And operator, let's move on to next question.

[Operator]

Thank you. Our next question comes from the line of Timothy Zhao from Goldman Sachs. Please ask your question, Timothy.

[Timothy Zhao, Equity Research Analyst at Goldman Sachs]

Thank you, management, for taking my questions. I have two questions here. First, as you have shared a lot about the recruitment trend year to date, especially after the Chinese New Year, could management share more detailed color about the recruitment demand between different enterprise size and also different industry? And more specifically, how should we think about the sustainability of the demand outlook? And second question is regarding the paying ratio and ARPU trend on the platform.

[Timothy Zhao, Equity Research Analyst at Goldman Sachs]

For this year, how we are going to plan to increase the monetization rate for ARPU on this platform? Thank you.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

So this year's spring recruitment season compared to last year, we find that sequential trend has been quite strong. But one number is that the online active store postings before and after the spring festival. So this year the sequential growth is more than 173% while last year is 141%. So this is the big picture. In white collar industry are stably recovering.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

So the highlight is that the AI related jobs have been helping with some subsectors or sub industries of Internet to starting regrowing. One important point is that compared to last quarter, this quarter our overall cash in has shown accelerating growth trends. And on the ARPU side, I don't have a very strong motive to increase ARPU very aggressively. I had witnessed in recovery across different industries and different sites of companies. So I will give them space to improve together.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

So last year we saw some good growth on the output side, but and also stabilize the pay ratio. I don't have very big aggressive plans to accelerate monetization, just waiting for things to turn better together. I would rather to look at with things on on the side of we are able to provide a service to different kind of users, especially enterprises, our model can provide service to different kind of enterprises. There is a number that after the COVID reopening in the past two years, we have served accumulatively more than 6,000,000 newly new enterprises and annual paid enterprise customers enterprise numbers increased by 1,500,000. I hope this data can mean something and show our view on the growth potential.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

And that's my answer to your question. And operator, let's move on to the next question.

[Operator]

Thank you. Our next question comes from the line of Wei Chung from UBS. Please ask your question Wei.

[Wei Xiong, Equity Research Analyst at UBS Group]

Thank you, management for taking my question. Firstly, I want to ask, what's our current customer acquisition cost? And how does it compare to a few years ago? If we look at 2025, are there any major marketing or promotion plans that we should be aware of? Given the continued margin expansion over the past few years, how should we think about the long term sustainable margin level for the company?

[Wei Xiong, Equity Research Analyst at UBS Group]

And second, on the blue collar business, wondering if management could share the revenue contribution and client feedback from our Conj program? What's our strategic focus and planning for our blue collar business among other new initiatives for this year? And how should we think about the change in revenue mix from the blue collar segment? Thank you.

[Yu Zhang, CFO & Executive Director at Kanzhun]

I'll answer the first question. Simply speaking, there's no big marketing campaign ahead in 2025. We are still at faster user growth stage. Our user growth target for this year is set as over 35,000,000 above for 2025. In terms of the selling marketing to our business is still with business leverage.

[Yu Zhang, CFO & Executive Director at Kanzhun]

Traffic acquisition per user today compared with prior years is much lower because of this is mainly because of a brand awareness. So the margin so the overall selling marketing as a percentage of total revenue, we continue to see this percentage going down. Except for marketing, other major costs and expenses items like COGS, sales expenses to the revenue and also R and D expenses are all well under control. So looking ahead, the gross margin and the operating margin are all expected to further improve for the full year. As we communicated last earnings call, we will we hope to secure high quality bottom line growth first, then we hope to actively look for additional upsides.

[Yu Zhang, CFO & Executive Director at Kanzhun]

So we set our full year non GAAP operating profit target as RMB3 billion for 2025, which is 30% higher than RMB2.3 billion non GAAP operating profit for 2024. And lastly, our share based compensation expenses, as I just mentioned in the prepared remarks, these expenses will decline sequentially and which makes our GAAP based bottom line GAAP based bottom line net profit with even higher gross. So that's my comments to the margins and our financial focuses for 2025.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

And thank you for remembering Hai Luo, which we have been talking about several years. So for the contract Hai Lawyoshi project, which is targeted for those agents with massive hiring demand. So last year we saw the contract amount full year contract amount for headway ownership more than RMB200 million. So I think any new business have more than 2% of our revenue contribution and is growing is a good and valuable input. So and also in the fourth quarter accumulated agencies who have joined have improved by 21% sequentially covered more than 40,000,000 of job seekers.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

And with the development AI, I believe since March potentially have some change. In the past those well trained by people, by the agencies have always had their advantages. The new guys who have a shorter period of experiences, they in the past they don't have advantages, but now with the empowerment of AI things are potentially to change to be equal. So in the when we initiated HaiLuo, we have didn't foresee this and now with potential changes, we will keep you updated and are in progress. And also we will keep our investment or exploring into closed loop services and placement related services.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

And that's my answer to your question. And given the time constraint, operator, I think that's our last question for today.

[Operator]

Thank you. That concludes today's question and answer session. At this time, I'll turn the conference back to Wenbei for any additional or closing remarks.

[Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun]

Thank you once again for joining us today. If you have any further questions, please contact our team directly or at TD Investor Relations. Thank you.

[Operator]

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.

Participants

Analysts

• Wenbei Wang, Head of Investor Relations & Capital Markets at Kanzhun
• Yu Zhang, CFO & Executive Director at Kanzhun
• Eddy Wang, Analyst at Morgan Stanley
• Timothy Zhao, Equity Research Analyst at Goldman Sachs
• Wei Xiong, Equity Research Analyst at UBS Group