Zhibao Technology Inc (ZBAO) Q4 2023 Earnings Report

Zhibao Technology (ZBAO) delivered a solid topline expansion in Q4 2023, with revenue of $11.64 million, up 60.4% year over year. Despite the revenue growth, the quarter carried a net loss of $1.18 million and negative EBITDA of $1.08 million, driven by a combination of operating expenses and sizable non-cash/one-time items reflected in other expenses. The company generated meaningful operating cash flow of $6.03 million and free cash flow of $5.99 million, contributing to a cash position of approximately $15.44 million at period end. This strong cash generation provides a cushion for liquidity as ZBAO scales its digital insurance brokerage and related services in China.

Near-term profitability remains a key question. The gross margin stands at roughly 35% (gross profit of $4.07 million on revenue of $11.64 million), but operating and net margins are negative (operating margin around -9.94% and net margin around -10.1%). The balance sheet shows a solid asset base (~$234.2 million) and a long-standing net debt position (~$24.6 million), with liquidity adequate on a current-ratio basis but a low cash ratio (~0.026) given sizable current liabilities. Management commentary (where available) and the upcoming quarters will be critical to confirm operating leverage prospects, the trajectory of working capital efficiency (notably days sales outstanding around ~645 days), and the normalization of any unusual items embedded in “other expenses.” Investors should monitor the cadence of revenue growth, cost discipline, and the conversion of topline expansion into sustainable profitability.