Awesome! Anker's annual revenue is 12.5 billion, and its R&D expenses are nearly 800 million

In 2021, Anker Innovations' revenue exceeded 10 billion yuan for the first time. This year, it spent nearly 800 million yuan on product research and development. Against the backdrop of rapid updates and iterations of 3C products, the company expanded its product categories and entered the 3D printing industry .

Revenue exceeds 10 billion for the first time , and Anker Innovations’ net profit approaches 1 billion

When it comes to Anker Innovations, cross-border sellers in the industry generally comment on it: "A big boss who is serious about making products", "a benchmark for industry sellers", "an excellent Chinese overseas brand", "a big seller who focuses on product research and development"...

The label given by peers is based on Anker Innovations' own strength. Recently, it released its 2021 financial report, and the data in it once again made everyone sigh: "The boss is the boss!"

According to public financial report data, in 2021, Anker Innovations achieved revenue of 12.574 billion yuan, an increase of 34.45% compared with the same period last year; and achieved net profit attributable to shareholders of listed companies of 982 million yuan, an increase of 14.70% year-on-year.

Compared with 2019 and 2020, Anker Innovations' revenue and net profit both grew steadily in 2021.

To be more specific, from the first quarter to the fourth quarter of 2021, Anker Innovations' revenue was 2.427 billion, 2.943 billion, 3.055 billion, and 4.149 billion, respectively, and its net profit was 204 million, 204 million, 237 million, and 336 million, respectively. In the traditional peak season, the company's revenue and net profit in the fourth quarter were also relatively high.

However, since we are talking about net profit, it is worth noting that Anker Innovations' non-GAAP net profit was 708 million yuan in 2021, and the figure was 727 million yuan in 2020. Although revenue increased, non-GAAP net profit did decline.

Anker Innovations is a well-known cross-border e-commerce leader. Its sales model covers all channels of "online + offline", with online channels accounting for a relatively large proportion.

Online, Anker has established presence on mainstream e-commerce platforms such as Amazon, AliExpress, and eBay overseas , and has entered more emerging markets relying on online sales platforms such as Amazon. In China, it also conducts online sales through platforms such as Tmall and JD.com.

In 2020 and 2021, Anker Innovations' revenue from online sales accounted for 68.10% and 63.62% of its total revenue, respectively. Amazon platform definitely accounts for the majority of its online revenue. In these two years, the company's revenue on Amazon accounted for 61.74% and 54.66% of its total revenue, respectively. Anker Innovations is a veritable Amazon seller, but this also shows that it is highly dependent on Amazon.

In terms of offline sales, Anker Innovations mainly sells its products through cooperation with global retail stores, regional large retail stores, independent 3C stores and professional channel sellers. It has entered world-renowned supermarket chains such as Walmart, Best Buy, Target, and Costco in North America, as well as the Japanese retail giant 7-11 convenience store group, and has also expanded offline in countries and regions such as Europe, Australia, Southeast Asia, and South America.

As of the end of 2021, Anker Innovations' business has covered more than 146 countries and regions, with more than 100 million users worldwide.

Among all sales destinations, Europe and the United States are still Anker Innovations' main battlefield. In 2020, the company's revenue in North America and Europe accounted for 53.67% and 19.49% respectively. In 2021, the revenue in North America and Europe did not change much, accounting for 50.43% and 20.22% respectively.

The overseas market is Anker Innovations' main market. In 2020, its overseas revenue accounted for more than 98%, and in 2021 this figure reached 96.66%.

In terms of its revenue proportion, Anker Innovations' business is mainly based on Amazon's online channels, and its consumer groups are also highly concentrated in North America and Europe. In 2021, the company increased its business expansion in other regions, and laid out important emerging markets such as mainland China, Australia, Southeast Asia, and South America. Its revenue growth rate in countries and regions such as Europe, mainland China, and Australia exceeded 30%.

Behind Anker Innovations' performance, its products are the biggest driving force, and the company has invested heavily in product research and development.

With an annual investment of nearly 800 million yuan in research and development , Anker's "ace" product ranks first in the world

Anker Innovations is mainly engaged in the independent research and development, design and sales of its own brand of mobile device accessories, smart hardware and other consumer electronic products. Its products mainly include three series: charging, smart innovation and wireless audio.

Among the three major product series, charging products are the absolute "trump card". Its charging products mainly include "Anker" brand high-end and mid-range charging, mobile power, data cables and other digital peripheral products.

In 2021, the company's charging products achieved operating income of 5.552 billion yuan, a year-on-year increase of 34.00%, accounting for 44.16% of total operating income. This is mainly due to the continued increase in demand for fast charging products and the company's timely launch of new products with leading technology and strong adaptability, such as wireless charging accessories.

Charging products are also the earliest product category launched by Anker Innovations. They are still one of the main sources of the company's product sales revenue and are also a product area that the company continues to focus on developing.

According to the Euromonitor International report in November 2021, Anker charging products have become the world's number one third-party digital charging brand in terms of retail sales.

Anker Innovations' second largest product series is smart innovation, which includes eufy clean, which focuses on smart home cleaning technology products , eufy security, which focuses on smart home security products, and Nebula, which focuses on laser smart projection products.

The performance of this category of products in 2021 should not be underestimated, with operating income of 4.104 billion yuan, a year-on-year increase of 34.13%, accounting for 32.63% of total operating income. Compared with the previous period, the stable growth of revenue in this category is mainly the result of the continuous enrichment and upgrading of category products.

Anker Innovations’ third product series is wireless audio, mainly including “Soundcore” brand wireless Bluetooth headsets, wireless Bluetooth speakers, audio glasses and other products, providing users with high-quality listening experience.

In 2021, the sales of the main series of this category, such as Life and Liberty, grew steadily, with annual operating income of 2.852 billion yuan, a year-on-year increase of 34.44%, accounting for 22.68% of the total revenue.

At present, Soundcore has launched multiple audio product series based on different usage scenarios, such as the Soundcore Liberty series, which is the benchmark for sound quality, and the Soundcore Life series, which is a companion for daily life. At the same time, it has also entered the smart glasses category and launched the Soundcore Frames series, which is convenient and comfortable. In the future, Soundcore will continue to develop new products and continue to iterate and improve.

The company's performance is largely attributed to its products, and the success of its products lies mainly in two key factors: product research and development and product design.

Among the top sellers in the cross-border e-commerce industry, Anker Innovations' R&D capabilities are definitely impressive. Speaking of Anker Innovations, one seller said: "The ultimate goal of domestic sellers is to build a Chinese brand like Anker, relying on their own product R&D capabilities."

As peers have said, Anker Innovations attaches great importance to R&D innovation, focusing on independent R&D, developing products with a market-oriented approach, and continuously improving product design, technology, and quality requirements.

Anker Innovations' emphasis on R&D is directly reflected in its investment and employee ratio. In 2021, the company's R&D investment was nearly 800 million yuan.

In 2019, 2020 and 2021, Anker Innovations' R&D investment reached 394 million yuan, 567 million yuan and 778 million yuan respectively, accounting for 5.92%, 6.07% and 6.19% of total operating income respectively, and has been on an upward trend for three consecutive years.

As of December 31, 2021, the company has a total of 3,532 employees, including 1,605 R&D personnel, accounting for 45.44% of the total number of employees. Among the company's multiple departments, R&D department personnel account for nearly half, which may be unattainable by other cross-border sellers!

A well-known industry insider said: "Anker Innovations' R&D staff are paid very high salaries, and the average salary increase is also very fast, which may have exceeded the average value created." In this case, some peers are skeptical: "With such a large amount of R&D expenses, will it really not drag down the net profit?"

However, some sellers believe that products are the lifeblood of a company, especially 3C products, which are updated at a relatively fast pace. As long as Anker is willing to invest in research and development, this wave of growth will be very stable, and it is a practitioner of long-termism.

Based on this, Anker Innovations has also obtained a number of patents. As of December 31, 2021, it has obtained 64 invention patents, 298 utility model patents and 459 appearance patents worldwide, and has a number of patents pending.

On this basis, Anker Innovations will continue to increase its investment in R&D in the future to further consolidate and enhance its technological R&D advantages.

In addition to its R&D advantages, Anker Innovations' design strength also adds color to its products.

The company will combine the market demands of the global consumer electronics industry, keep up with the cutting-edge fashion trends in the industry, and conduct in-depth research on market demands, consumer preferences, etc. to design products. Its product design capabilities have been highly recognized by the international consumer electronics product design field and ordinary consumers.

In 2021, Anker Innovations' products won multiple international awards, including 4 German Red Dot Design Awards, 7 Hannover Industrial (iF) Design Awards, 5 G-MARK Design Awards, and 3 IEDA Design Awards. As of December 31, 2021, the company has won a total of 73 international industrial and consumer electronics product design awards.

In addition to deepening its existing product portfolio, Anker is also constantly exploring new markets. Now it has expanded its products to the 3D printing field, and the scale is not small.

Expanding product categories, Anker enters 3D printing

In September last year , industry insiders discovered that Anker began recruiting 3D printing talents, including senior slicing algorithm engineers, senior motor drive algorithm engineers, senior OpenGL engineers, etc., and speculated that Anker would enter the 3D printing industry to get a piece of the pie. In March this year, Anker released recruitment information for comprehensive algorithm experts and other personnel, and offered a salary of 30,000 to 60,000 yuan per month to expand its 3D printer team.

In early April, Anker released its latest product, the AnkerMake M5 3D printer, on the crowdfunding platform Kickstarter. The early bird price is $499, and the actual selling price is no less than $759. So far, more than 8,300 supporters have raised $5.31 million for it, far exceeding its crowdfunding goal of $50,000.

Combining the product information that has been released, foreign media The Verge praised AnkerMake M5 and said it might be the product that 3D enthusiasts have been waiting for for a long time.

3D printing has long been a time-consuming and expensive hobby. In addition to its high price, its printing speed and accuracy have always been criticized. Anker's products are designed to solve these pain points.

First, compared with its peers, this Anker product takes less time to prepare before printing, and can start working in just 15 minutes. Secondly, when using other 3D printers, users need to stay by the machine or install a camera to view and record the printing process, but this product is equipped with a smart camera, and users can remotely view the printing status in real time through the corresponding APP. The product can also automatically pause printing, and send an alert to the user when it detects problems such as nozzle clogging.

In addition, Anker introduced that this 3D printer can increase the printing speed to 5 times that of competing products, and the printing accuracy is 0.1 mm, which can make the printed curves smoother. Taking the vase as an example, any FDM 3D printer can print relatively fast, but the M5 can make the process faster, and the printing speed is a major selling point of this product.

Anker spokesman Eric Villines said Anker will enter new product categories when it can solve people's pain points, and now is the right time. "I think 3D printers are coming at the right time. They may become mainstream, and even if they are not mainstream, they are certainly not just a niche market."

But Anker still has a lot of work to do, including testing software features like smart failure printing, promised voice assistant compatibility, and most of the software has yet to be built. "I like to say it's 75% hardware and 2% software," Villines said.

AnkerMake M5 is mainly sold overseas, with an estimated delivery time of November this year. However, considering the relevant regulations of the new crown epidemic and the backlog of cargo at global ports, the specific delivery time may be delayed. Anker is also trying its best to avoid delays.

Anker has done its homework for this foray into 3D printing.

Although it may seem like a niche field, the market potential of 3D printing cannot be underestimated. A market report recently released by consulting firm AMPOWER predicts that the annual growth rate of the additive manufacturing market will reach 18.2% in the next four years, and the value of the 3D printing industry is expected to reach 20 billion euros by 2026.

In the field of global consumer-grade 3D printers, Chinese manufacturers hold up half the sky, and Shenzhen Zongwei Cube, Shenzhen Chuangxiang 3D, etc. are both leaders in this field.

Take Zongwei Cube as an example. The company focuses on the research and development, production and sales of 3D printers. It owns its own printer brand Anycubic. Its products are mainly sold on AliExpress and Amazon. Nearly 90% of its products are sold to global markets such as the United States, Germany, and France. They are widely used in education, industry, jewelry, medical and other fields. In 2020, Zongwei Cube's annual shipments exceeded 500,000 units, with revenue of 800 million yuan.

Today, Anker's annual sales exceed 10 billion yuan. The entry of such a consumer electronics giant will inevitably arouse the vigilance of existing companies in the industry, and the industry landscape may be reshaped.

The 3D printing products received a lot of support when they were first released, thanks in large part to Anker’s well-known brand image.

Anker said that the company has established a high level of brand awareness and loyalty in the global consumer electronics market, which further supports the company's continuous expansion of product categories and the continued stable growth of sales. Based on a good user base, Anker continues to strengthen its global integrated marketing capabilities, and its brand awareness and market reputation continue to improve.

So far, many mainstream media in the world, such as The New York Times and The Wall Street Journal, have reported Anker's products and brands as excellent cases. Hundreds of anchor channels on YouTube have released video evaluation reports on Anker products. In 2021, Anker won the gold award of the "2021 Golden Investment Awards Business Creativity Award" and became the world's number one digital charging brand, confirming its strong position in the digital charging retail market.

The substitutability of consumer electronics means that Anker must never slack off in product development and branding, which is also Anker's next important task.

Anker's four plans for 2022

Anker focuses on charging products, smart innovation products and wireless audio products, and the market situation of these three different categories is changing.

In recent years, the market for mobile devices such as smartphones has continued to grow, driving the rapid development of the consumer electronics industry, with charging transmission and audio products gaining momentum. However, since the outbreak of the COVID-19 pandemic, the global economy has been affected, and shipments of mobile devices such as smartphones have declined. Although the economy has recovered in some regions, the growth of the global smartphone industry has slowed significantly, and manufacturers in the consumer electronics industry have begun to look for and plan new future business growth points.

In contrast, the epidemic has prolonged people's working time at home, and the sales of smart hardware such as smart homes and smart cloud office equipment have increased, becoming a new opportunity for the consumer electronics industry.

Anker has observed these trends and may focus on product category layout. In terms of revenue structure, more than 90% of Anker's revenue comes from overseas, and the steady growth of global e-commerce has supported Anker's cross-border business.

Market research firm eMarketer predicts that global retail e-commerce sales are expected to exceed US$6.169 trillion in 2023, the proportion of sales from e-commerce channels in global retail sales will steadily increase, and the penetration rate of e-commerce will continue to increase.

The development of domestic cross-border e-commerce has also benefited from this. In 2021, China's cross-border e-commerce exports reached 1.44 trillion yuan, a year-on-year increase of 24.5%. In the next few years, the cross-border e-commerce industry will develop well, and the business opportunities are self-evident.

However, Anker also faces risks such as changes in the consumer electronics industry and product upgrades, intensified market competition, fluctuations in raw material prices and exchange rate fluctuations. On April 11, Anker's stock price fell 3.33%, closing at 60.05 yuan, and the intraday stock price hit a record low of 59.55 yuan. The day after the release of the 2021 financial report, Anker's intraday increase reached 5%.

Based on comprehensive considerations, Anker has set four main work plans for this year:

1. Increase investment in R&D, lead the exploration of innovative technologies and create benchmark products . This year, Anker will continue to increase investment in product R&D, technology, etc. On the basis of consolidating existing product technologies, it will continue to promote technological innovation in charging, wireless audio and other products by continuously strengthening the construction of new R&D centers; increase R&D and innovation efforts in the field of consumer electronics such as smart innovative products;

2. Increase brand investment and build a global leading brand through global marketing activities. Anker will continue to strengthen and optimize brand marketing, keep up with the trend of changes in information dissemination methods, and continue to improve brand awareness and user reputation on a global scale through the effective Anker Innovation brand marketing methodology while providing users with innovative products, thereby further creating value for users.

3. Deepen the market of developed countries and actively expand the emerging economic markets. On the one hand, Anker will consolidate the markets of major developed countries and regions, expand the market share of products in countries and regions such as North America, Europe, Japan and the Middle East, enhance the brand awareness and reputation of the company in the above markets, and increase market expansion efforts. On the other hand, Anker will focus on expanding the markets of emerging economic countries and regions, enhance brand awareness and market share, and the regional markets of China, Southeast Asia and Latin America will be the key areas for its continued layout in the future.

4. Improve product quality control capabilities and provide customers with high-quality products. In 2022, Anker plans to add more comprehensive testing items based on its existing hardware testing capabilities as product categories become more diverse and design structures become more complex, and continue to improve the efficiency and accuracy of product quality testing.

In 2021, Anker's performance was very impressive. As a leader in the domestic cross-border e-commerce industry, its performance this year is also worth looking forward to.

Anker Innovations

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