A hot-selling new brand was exposed, eyeing this track

In the cross-border circle, Beijing-based Hanwang Technology is rarely mentioned. However, if we talk about Ugee, a well-known digital painting brand on the Amazon platform, many sellers will definitely be familiar with it. Not long ago, Hanwang Technology made another new move, and a new brand was officially announced. This time, it has set its sights on the e-paper segment and made strategic layout.

New overseas brands exposed, North American online layout completed

At the 7th China International Import Expo held in early November, Hanwang Technology unveiled its new overseas brand Penstar for the first time. It is reported that this brand is Hanwang's new brand for entering the overseas e-paper market. It started sales in the North American market in August and has now completed the layout of North American online e-commerce channels.

So, what exactly prompted Hanwang Technology to set its sights on the overseas e-book market?

Market data provides a strong answer. According to data from RUNTO Technology, the shipment volume of large-size e-paper devices will reach about 15 million units in 2022, a year-on-year increase of more than 15%. It is estimated that the overall market size of global e-paper terminal products will reach US$72.3 billion in 2025.

In addition, people in developed countries such as Europe and the United States have good reading habits. Taking the United States as an example, according to the forecast of Lotoo Technology, with the release of demand from large retail terminals such as Walmart, the demand for products such as electronic paper labels in the US market will increase, and the United States will become one of the market regions with the largest contribution to the shipments of brands such as French SES-IMAGOTAG.

Hanwang Technology's launch of the e-book brand overseas was not a momentary impulse, but was based on the solid foundation and strong confidence accumulated from its years of deep cultivation in the domestic market.

As one of the earliest brands to enter the field of electronic paper in China, Hanwang Technology has a high reputation and a certain market share in the domestic market. Its products cover multiple series and models, which can meet the needs of different user groups, such as study notebooks for students and office notebooks for office workers.

The financial report shows that in 2023, in addition to the year-on-year growth in revenue and gross profit, the GMV of its e-book series products on the Jingtao platform has increased by more than 200% for three consecutive years; in terms of market share, the online sales market share of e-paper office books has increased to about 12%, and after the product line of e-paper readers has been improved, the market share is gradually increasing.

In the financial report, it clearly stated that it hopes to make the handwriting e-paper the fourth mainstream electronic product after mobile phones, computers and pads.

Overall, Amazon's Kindle has a clear advantage in the field of electronic paper . Since the launch of the first generation of Kindle in 2007, relying on Amazon's powerful book resources and brand influence, Kindle has quickly become one of the most popular electronic paper brands in the world.

At the same time, domestic brands represented by Hanvon Technology have continued to make efforts in technology research and development and product innovation in recent years, and have gradually emerged in overseas markets.

The digital painting business generates annual revenue of 1 billion, and many products are listed on Amazon's Best Sellers list

When it comes to Hanwang Technology, cross-border e-commerce sellers may be more familiar with its digital painting products. It is understood that the main users of its digital painting products are CG designers, painting enthusiasts, beginners, semi-professional users, etc. The product series has achieved full coverage of "entry-level", "consumer-level" and "professional-level", and is sold to more than 100 countries and regions around the world through more than 20 online third-party platforms, 15 self-built websites, and offline channels.

For a long time, the sales of digital painting products have always occupied a key position in Hanwang Technology's revenue structure, contributing a considerable share to the overall revenue.

According to relevant information, in 2020, Hanwang Technology's digital painting products showed extremely strong sales momentum, with sales reaching around 1 billion yuan, doubling compared to 2019. According to third-party sales information, its annual sales exceeded 1.5 million units.

With the strong support of the digital painting business, Hanwang Technology achieved operating income of 1.555 billion yuan in 2020, a year-on-year increase of 40.8%, and net profit of 104 million yuan, a year-on-year increase of 177.81%, setting the best operating performance since the company was founded.

By 2023, the performance of digital painting products is still very impressive. The financial report shows that in 2023, although the sales volume is basically the same as last year, the gross profit margin has increased by 2 percentage points. At the same time, the sales volume of professional-grade product lines has increased significantly by 26%.

It is understood that Hanwang Technology has three main digital painting brands, including XP-PEN (consumer level), ugee (entry level), and xencelabs (professional level).

On Amazon, these brands have good sales performance, and many products have entered the BSR list. For example, a product of the ugee brand entered the top 3 of the BSR list of "Computer Graphics Tablets". Currently, the product has accumulated more than 5,300 reviews and an overall star rating of 4.5.

Consumers gave it high marks for ease of use, value for money, and design. They mentioned that the shortcut keys are easy to program, making it great for beginners. Some also liked how sensitive it was and how fun it was to use.

With accumulated losses exceeding 270 million in two years, can the new brand become the "savior"?

In the 14 years since its listing , Hanwang Technology's performance has always been in a state of good one year and bad one or two years. In recent years, its revenue growth has been out of sync with profit growth, and the dilemma of increasing revenue but not profit is particularly prominent, and it has even fallen into the quagmire of continuous losses.

The financial report shows that in 2022, Hanwang Technology achieved revenue of 1.401 billion yuan, a year-on-year decrease of 13.19%, and net profit attributable to shareholders of the parent was -136 million yuan, a year-on-year decrease of 350.63%; the non-net profit attributable to shareholders of the parent was -139 million yuan, compared with a profit of 44.7526 million yuan in the same period last year.

In 2023, Hanwang Technology achieved operating income of 1.45 billion yuan, a year-on-year increase of 3.56%; net profit attributable to shareholders was -135 million yuan, a year-on-year reduction of 0.65%; net profit attributable to shareholders after deducting non-recurring items was -157 million yuan, and the loss increased by 12.82%.

In two years, its total losses reached 271 million yuan.

The loss situation still exists this year. The financial report shows that in the first three quarters of 2024, its operating income was 1.147 billion yuan, a year-on-year increase of 17.9%; the net profit attributable to the parent company was -75.01 million yuan, a year-on-year increase of 16.5%; the net profit attributable to the parent company after deducting non-recurring items was -82 million yuan, a year-on-year increase of 8.1%.

Hanwang Technology's performance fluctuations are closely related to its business transformation.

In the early years, Hanwang Technology started out mainly with input devices such as stylus pens and tablets. As the market space for these products shrank, it gradually sought transformation. Over the years, it has tried various tracks such as air purifiers, facial recognition devices, and electronic paper books.

Electronic paper is the first direction of its transformation. At present, it has chosen the right direction. The financial report shows that from last year, Hanwang Technology has launched new products in the four series of electronic paper products for reading, writing, office, and learning, and all of them are equipped with Hanwang Tiandi large models. The revenue of the electronic paper business line in 2023 increased by 273% year-on-year, the revenue exceeded 100 million, and the gross profit margin increased by 10% year-on-year.

Perhaps it is for this reason that it chose to start from this field and create a new brand to expand overseas markets.

However, whether the current business layout can help Hanwang Technology successfully reverse its loss situation is still full of uncertainty. After all, in the competitive field of electronic paper books, Kindle is like a mountain, occupying an important position for a long time and having a huge user base.

Electronic paper

Hanwang Technology