China-based job board and HR resource services provider 51job Inc. (NSDQ: JOBS) reported net revenue increased by 32.6% in the second quarter ended 30 June 2021 to RMB 1.09 billion (USD 169.8 million).

Despite the strong growth in revenue, gross margin fell during the quarter to 61.8%. The increase in cost of services was primarily due to higher employee compensation expenses, staff additions and greater direct costs, such as venue rentals and media production services, incurred in providing training, campus recruitment and placement services to employers.

General and administrative expenses for the second quarter of 2021 increased by 14.8%. The company recognised a loss from foreign currency translation of RMB 12.5 million (USD 1.9 million) in the second quarter of 2021 compared with RMB 0.5 million (USD 77,322) in the second quarter of 2020, primarily due to the impact of the change in exchange rate between the Chinese renminbi and the US dollar on the company’s US dollar cash deposits.

51job operates in two primary business segments: Online Recruitment Services and Other HR Related.

Revenue by segment

Online recruitment services revenues for the second quarter of 2021 increased primarily due to improved market conditions and more hiring activity from employers this year. While the company believes there will be continued recovery in its online recruitment business in 2021, the recruitment outlook may be affected by uncertainty in the ongoing global pandemic and occasional restrictions instituted by authorities to contain outbreaks in China.

The growth in Other human resources related revenue was primarily driven by strong demand for training services, campus recruitment campaigns, placement projects and business process outsourcing services this year.

51job also reported revenue for the six months ended 30 June 2021 of RMB 1.99 billion (USD 308.3 million), up 23.1% from 1.61 billion (USD 250.5 million) the year prior.