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By Ding Yi / Nov 24, 2020 12:37 PM / Business & Tech

Photo: VCG

Photo: VCG

Ruhnn Holding Ltd., a Chinese company that promotes e-commerce through key opinion leaders (KOLs), saw a decrease in revenue in the third quarter as sales slowed, but its net losses narrowed due to lower fulfillment spending, the cost of third parties processing and delivering orders.

During the three months through September, the U.S.-listed company’s net revenue totaled 248.5 million yuan ($36.6 million), representing a year-on-year drop of 9%, according to its latest earnings report released on Monday.

Ruhnn largely attributed the revenue decrease to sluggish product sales, which dropped 38% year-on-year to 129.2 million yuan, as the company overhauled its business model resulting in a decrease in the number of its online stores. Meanwhile, its revenue from services jumped 84% year-on-year to 119.3 million yuan in the third quarter, the report said.

While its total revenues dropped, Ruhnn saw its net losses narrow to 31.2 million yuan compared with a 50.1 million yuan loss in the same period of last year, which the company attributes to a significant decrease in fulfillment spending, which dropped 52% year-on-year to 16.9 million yuan amid weaker demand for its products.

Ruhnn runs online stores on third-party e-commerce platforms, mostly under the names of KOLs, and makes money through online sales of its self-designed products including cosmetics and women’s clothes.

As of Sept. 30, Ruhnn had signed up 180 KOLs, eight of whom were top-tier online influencers including Zhang Dayi, one of China’s most successful internet celebrities.

“Our signed KOLs have been further diversified across major social media platforms in China, such as Xiaohongshu, Kuaishou, Bilibili, Douyin and Weibo,” said Ruhnn CEO Sun Lei, adding that the eight top-tier KOLs accounted for 28% of the company’s total services revenue.

Ruhnn’s stock closed down 3.64% at $2.65 on Monday.

Contact reporter Ding Yi (

Related: U.S.-Listed Chinese KOL Company Falls 9% After Flood of Class Lawsuits

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