Zepp Health Corp. Files Annual Report on Form 20-F

TL;DR

<b>Zepp Health Corp. has filed its annual 20-F report for the fiscal year ending December 31, 2023, detailing financial performance and business operations.</b>

AI Summary

Zepp Health Corp (ZEPP) filed a Foreign Annual Report (20-F) with the SEC on April 23, 2024. Zepp Health Corp. filed its annual report on Form 20-F for the fiscal year ended December 31, 2023. The filing includes financial information and business operations for the period. The company was formerly known as Huami Corp. and changed its name on October 23, 2017. Key related parties mentioned include Xiaomi Communication Information Technology, Xiaomi Communication Technology Company Limited, Whale Microelectronics Co. Ltd, and Xiaomi Youpin. The report covers various tax administrations, including Netherlands, Canada Revenue Agency, Internal Revenue Service (IRS), and Inland Revenue Hong Kong.

Why It Matters

For investors and stakeholders tracking Zepp Health Corp, this filing contains several important signals. This filing provides investors with a comprehensive overview of Zepp Health's financial health, operational performance, and strategic direction for the past fiscal year. Disclosure of related party transactions and tax administration interactions offers insights into the company's business relationships and regulatory compliance.

Risk Assessment

Risk Level: medium — Zepp Health Corp shows moderate risk based on this filing. The company's reliance on related parties like Xiaomi for sales and its operations in various international tax jurisdictions present potential market and regulatory risks.

Analyst Insight

Review the detailed financial statements and risk factors in the 20-F filing to assess Zepp Health's performance and future outlook.

Key Numbers

• 2023-12-31 — Fiscal Year End (Reporting period)
• 2024-04-23 — Filing Date (Date of submission)
• 0001720446 — Central Index Key (Company identifier)
• 001-38369 — SEC File Number (SEC filing identifier)

Key Players & Entities

• Zepp Health Corp. (company) — Filer
• Huami Corp. (company) — Former company name
• Xiaomi Communication Information Technology (company) — Related party
• Xiaomi Communication Technology Company Limited (company) — Related party
• Whale Microelectronics Co. Ltd (company) — Related party
• Xiaomi Youpin (company) — Related party
• Internal Revenue Service (IRS) (regulator) — Tax administration
• Canada Revenue Agency (regulator) — Tax administration

FAQ

Key Dates

• 2023-12-31: Fiscal Year End — End of the reporting period for the 20-F filing.
• 2024-04-23: Filing Date — Date the 20-F report was officially submitted to the SEC.
• 2017-10-23: Name Change — Date Zepp Health Corp. changed its name from Huami Corp.

Glossary

20-F

An annual report required by the U.S. Securities and Exchange Commission (SEC) for foreign private issuers. (Provides a comprehensive overview of the company's financial performance and business operations.)

Related Party

A party that has the ability to control or significantly influence the operating decisions of another entity. (Understanding related party transactions is crucial for assessing potential conflicts of interest and the true economic substance of dealings.)

Key Financial Figures

• $0.0001 — ur Class A ordinary shares, par value US$0.0001 per share) Class A ordinary shares, p
• $ — a company incorporated in the PRC; "US$," "U.S. dollars," "$," or "dollars" ref
• $1 — rt are made at a rate of RMB7.0999 to US$1.00, the exchange rate in effect as of D

Filing Documents

• zepp-20231231x20f.htm (20-F) — 4648KB
• zepp-20231231xex4d19.htm (EX-4.19) — 41KB
• zepp-20231231xex8d1.htm (EX-8.1) — 14KB
• zepp-20231231xex12d1.htm (EX-12.1) — 13KB
• zepp-20231231xex12d2.htm (EX-12.2) — 13KB
• zepp-20231231xex13d1.htm (EX-13.1) — 7KB
• zepp-20231231xex13d2.htm (EX-13.2) — 7KB
• zepp-20231231xex15d1.htm (EX-15.1) — 4KB
• zepp-20231231xex15d2.htm (EX-15.2) — 8KB
• zepp-20231231xex97d1.htm (EX-97.1) — 41KB
• zepp-20231231x20f013.jpg (GRAPHIC) — 106KB
• zepp-20231231xex15d2001.jpg (GRAPHIC) — 34KB
• 0001104659-24-050344.txt (&nbsp;) — 16128KB
• zepp-20231231.xsd (EX-101.SCH) — 91KB
• zepp-20231231_cal.xml (EX-101.CAL) — 87KB
• zepp-20231231_def.xml (EX-101.DEF) — 415KB
• zepp-20231231_lab.xml (EX-101.LAB) — 824KB
• zepp-20231231_pre.xml (EX-101.PRE) — 682KB
• zepp-20231231x20f_htm.xml (XML) — 2525KB

FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS 2 PART I 3 ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS 3 ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE 3 ITEM 3. KEY INFORMATION 3 ITEM 4. INFORMATION ON THE COMPANY 59 ITEM 4A. UNRESOLVED STAFF COMMENTS 93 ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS 93 ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES 107 ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS 121 ITEM 8. FINANCIAL INFORMATION 122 ITEM 9. THE OFFER AND LISTING 123 ITEM 10. ADDITIONAL INFORMATION 124 ITEM 11.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 136 ITEM 12.

DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES 137 PART II 138 ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES 138 ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS 138 ITEM 15.

CONTROLS AND PROCEDURES

CONTROLS AND PROCEDURES 139 ITEM 16. [RESERVED] 139 ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT 139 ITEM 16B. CODE OF ETHICS 139 ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES 140 ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES 140 ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS 140 ITEM 16F. CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT 141 ITEM 16G. CORPORATE GOVERNANCE 141 ITEM 16H. MINE SAFETY DISCLOSURE 141 ITEM 16I . DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS 141 ITEM 16J. INSIDER TRADING POLICIES 142 ITEM 16K. CYBERSECURITY 142 PART III 143 ITEM 17.

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS 143 ITEM 18.

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS 143 ITEM 19. EXHIBITS 144 i Table of Contents INTRODUCTION Unless otherwise indicated and except where the context otherwise requires, in this annual report on Form 20-F: "ADSs" refer to our American depositary shares, each of which represents four Class A ordinary shares; "ADRs" refer to the American depositary receipts that evidence our ADSs; "China" or the "PRC" refers to the People's Republic of China, excluding, for the purpose of this annual report only, Hong Kong, Macau and Taiwan; "Class A ordinary shares" refer to our class A ordinary shares, par value US$0.0001 per share; "Class B ordinary shares" refer to our class B ordinary shares, par value US$0.0001 per share; "Memorandum and Articles" refer to the second amended and restated memorandum of association and articles of association adopted by a special resolution passed on January 12, 2018 and effective on February 12, 2018; "ordinary shares" refer to our Class A and Class B ordinary shares, par value US$0.0001 per share; "Our platform" refers to the products and mobile apps that we provide to users and platform partners; "RMB" or "Renminbi" refers to the legal currency of China; "Shunyuan Kaihua" or "our WFOE" refers to Beijing Shunyuan Kaihua Technology Co., Ltd., a wholly owned foreign enterprise incorporated with limited liability in the PRC; "the VIEs" refer to Anhui Huami Information Technology Co., Ltd. and Huami (Beijing) Information Technology Co., Ltd., each of which is a company incorporated in the PRC; "US$," "U.S. dollars," "$," or "dollars" refer to the legal currency of the United States; "Xiaomi" refers to Xiaomi Corporation; "Xiaomi Wearable Products" refer to Xiaomi-branded smart bands, watches (excluding children watches and quartz watches), scales and associated accessories; "Zepp," "we," "us," "our company" or "our" refer to Zepp Health Corporation, our Cayman Islands holding company, and its subsidiaries, and, in the context of describ

FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS This annual report on Form 20-F contains forward-looking statements that relate to our current expectations and views of future events. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigations Reform Act of 1995. You can identify some of these forward-looking statements by words or phrases such as "may," "will," "expect," "anticipate," "aim," "estimate," "intend," "plan," "believe," "is/are likely to," "potential," "continue" or other similar expressions. We have based these forward-looking statements largely on our current expectations and projections about future events that we believe may affect our financial condition, results of operations, business strategy and financial needs. These forward-looking statements include statements relating to: our goals and strategies; our future business development, financial conditions and results of operations; the expected growth of the smart wearable devices industry; our expectations regarding demand for and market acceptance of our products and services; our expectations regarding our relationships with Xiaomi, our other distributors, customers, contract manufacturers, component suppliers, strategic partners and other stakeholders; regulatory and operating conditions in the geographical markets in which we operate; competition in our industry; and government policies and regulations relating to our industry. You should read this annual report and the documents that we refer to in this annual report and have filed as exhibits to this annual report completely and with the understanding that our actual future results may be materially different from what we expect. Other sections of this annual report dis

IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS Not applicable.

OFFER STATISTICS AND EXPECTED TIMETABLE

ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE Not applicable.

KEY INFORMATION

ITEM 3. KEY INFORMATION Our Holding Company Structure and Contractual Arrangements with the VIEs Zepp Health Corporation is not a Chinese operating company but a Cayman Islands holding company with no equity ownership in its consolidated variable interest entities, or VIEs. We conduct our operations in China through (i) our PRC subsidiaries and (ii) the VIEs with which we have maintained contractual arrangements and their subsidiaries in China. PRC laws and regulations impose certain restrictions or prohibitions on foreign ownership of companies that engage in developing substantial proprietary technology to produce consumer health and fitness devices. Accordingly, we operate these businesses in China through the VIEs and their subsidiaries, and rely on contractual arrangements among our PRC subsidiaries, the VIEs and their nominee shareholders to control the business operations of the VIEs. The VIEs are consolidated for accounting purposes, but are not entities in which our Cayman Islands holding company, or our investors, own equity. Revenues contributed by the VIEs accounted for 83.5%, 61.2% and 39.8% of our total revenues for the years ended December 31, 2021, 2022 and 2023, respectively. As used in this annual report, "Zepp," "the Parent," "we," "us," "our company" or "our" refers to Zepp Health Corporation, its subsidiaries, and, in the context of describing our consolidated financial information, the consolidated VIEs and their subsidiaries in China. "Consolidated VIEs" refer to Anhui Huami Information Technology Co., Ltd. and Huami (Beijing) Information Technology Co., Ltd., each of which is a company incorporated in the PRC. Investors in our ADSs thus are not purchasing equity interest in the consolidated VIEs in China but instead are purchasing equity interest in Zepp Health Corporation, a Cayman Islands holding company. A series of contractual agreements, including loan agreement, equity pledge agreements, exclusive option agreements, exclusive consult

View Full Filing

View this 20-F filing on SEC EDGAR