HK Stock Market Move | SMOORE INTL (06969) drops nearly 4% as increase in expenses affects short-term profit performance. Q1 net profit after tax decreases by 43.4% year-on-year.

SMOORE INTL (06969) fell nearly 4%, reaching a 3.88% decline at the time of the release, closing at HKD 9.41 with a turnover of HKD 4.52 billion. On the news front, SMOORE INTL announced last night that the group achieved a net profit of RMB 192 million for the three months ending March 31, 2025, a decrease of 43.4% year-on-year; total revenue for the period was RMB 208 million, a decrease of 32.9% year-on-year. The announcement stated that the group's pre-tax profit for the period fell by about 36.3% year-on-year, mainly due to increased administrative expenses, distribution and sales expenses, and research and development expenses compared to the same period last year. Sinolink believes that the significant decline in the company's pre-tax profit in Q1 2025 is mainly due to the increase in equity incentive amortization and research and development expenses, in addition to the company's increased marketing investment in its own brand business. Overall, the impact on the company's profit is mainly influenced by short-term external factors, and further performance is still anticipated. The bank also stated that it is important to take a rational view of the impact of tariffs, and the growth logic of the HNB business remains unchanged.