KUALA LUMPUR: Cuckoo International (MAL) Bhd is looking to drive growth through cross-selling more products to existing customers, expanding its omnichannel presence and improving operational efficiency amid softer consumer demand.
CEO Hoe Kian Choon said the home appliances and wellness company aims to increase the number of products each household subscribes to through cross-selling as part of its growth strategy.
“Our largest untapped opportunity lies within our existing customer base. Most of our sales come from customers who have only one product. We want to introduce cross-selling.
“We want each customer, instead of only having a water purifier, to have a second and third product. This is a very big untapped market,” he said on the sidelines after launching the company’s Corporate Social Responsibility Blueprint today.
Hoe said Cuckoo will continue to broaden its product portfolio to support its cross-selling strategy, citing its expanded collaboration with Samsung Malaysia as a key initiative.
Under the partnership, the company has introduced rental plans for selected Samsung home appliances, including televisions and refrigerators, allowing consumers to access premium products through affordable monthly instalments rather than upfront purchases.
Hoe said the initiative aligns with Cuckoo’s goal of making healthy home and smart living solutions more affordable and accessible while expanding its healthy home ecosystem beyond its core water purification business. “For Samsung, everything is already there. We launch rental plans. With rental, these products become more accessible and more affordable.”
He added that expanding the product range enables Cuckoo to offer customers more choices while creating opportunities to cross-sell additional products and strengthen long-term customer relationships.
At the same time, the group is broadening its distribution channels beyond its traditional direct-selling model by strengthening its presence across e-commerce platforms, TikTok and other digital channels.
“In the past, we focused on a single channel. What we want now is to diversify into different kinds of channels like e-commerce and TikTok so customers can easily access our products through different platforms,” Hoe said.
Operational efficiency remains one of management’s top priorities as the listed company seeks to strengthen resilience and create long-term shareholder value. “We are always emphasising operational efficiency. Every single ringgit we spend, we hope to generate a good impact,” Hoe said.
Beyond households, the company is targeting the corporate market as another avenue for growth, particularly hotels, restaurants and cafes (Horeca).
Hoe cited Cuckoo’s recent installations at Kuala Lumpur International Airport as part of efforts to expand its corporate footprint.
“We are expanding our corporate sales. Through our Horeca promotions, we want tourists and customers at hotels, restaurants and cafés to enjoy clean water and better air,” he said.
Asked about performance, Hoe acknowledged that market conditions remain soft but declined to comment on second-quarter trading ahead of the company’s upcoming financial results announcement.
“I think the market is softer. Please wait for our latest announcement because we will be making an announcement soon as we are approaching our second-quarter results,” he said.
Cuckoo’s first-quarter revenue fell 23.1% year-on-year to RM227.8 million amid softer consumer demand, while profit after tax declined 10.2% to RM25 million.
Addressing concerns over credit quality, Hoe said the company is stepping up efforts to improve collection efficiency after impairment losses rose in the first quarter, reflecting slower customer repayments under its subscription-based rental model.
Cuckoo’s net impairment losses on financial instruments increased 47.7% year-on-year to RM18.5 million in the first quarter ended March 31, 2026, from RM12.5 million a year earlier, which management previously attributed to slower repayment behaviour as consumers prioritised spending ahead of the Chinese New Year and Hari Raya festive seasons.
“This is a rental business and impairment is something natural. But we are putting in a lot of effort to improve our management efficiency and make impairment better,“ Hoe said.
On profitability, he said while the stronger ringgit contributed to higher gross margins by lowering imported product costs, the improvement was also driven by ongoing operational initiatives across the business.
In the first quarter, Cuckoo’s gross profit margin expanded to 38.3% from 31% a year earlier despite lower revenue, supported by lower product costs, reduced customer acquisition costs and tighter cost management.
“It is not only about the currency. We are moving towards operational efficiency. Gross profit improvement comes from the entire structure and strategy, not just one aspect,“ Hoe said.
Thousands of households will remain Cuckoo’s primary growth engine over the next three to five years, despite the company’s efforts to expand its corporate customer base, particularly in the Horeca segment.
“The household segment is still our forte and our main income source. Rental is still very important for us. Our growth engine will continue to be our omnichannel strategy and cross-selling strategy,“ Hoe said.
