Shares in Ecmoho Ltd. (Nasdaq: MOHO) tanked as much as 17% Friday after it said its revenue declined by half year-over-year.
The Shanghai-based non-medical health and wellness company said in a statement today that its revenue in the March quarter dipped to $27.09 million compared with $61.16 in the same period last year.
The bulk of Ecmoho's revenue comes from its product sales segment, which dipped to $26.41 million in the first quarter from $60.72 million. According to chief financial officer Xin Li, this came as a result of “negative news coverage” in regards to an unspecified brand product.
“As a result of our strategy to optimize brand selections and certain negative news coverage relating to one brand product, our financial performance was adversely affected in the first quarter of 2021,” Li said in a statement.
“However, we believe that this is a short-term setback, and we are committed to optimizing and diversifying our brands portfolio in order to achieve our growth strategy. More importantly, the growth momentum of services continued into 2021.”
But that wasn’t all; its net loss in the quarter widened to $6.07 million versus $4.58 million a year ago.
Ever since the company went public in late 2019, its stock has mainly followed a continuous downward trend. Ecmoho, which raised $44 million in its debut, has traded well below its IPO price of $10. Shares have tumbled 86% to date since the listing.
Meanwhile, one positive highlight in the first quarter was the growth of Ecmoho's paying customers. As of March, it counted 11.2 million cumulative paying customers, up from the 8.6 million it had in the same period in 2020. Also, its collaborations with healthcare professionals and KOLs exceeded 1,400, up 40% year-over-year.
And recently, Ecmoho launched a supplement product that treats those who deal with iron and vitamin B12 deficiencies.
Ecmoho did not provide an outlook for the second quarter.