GigaCloud Technology Inc

Welcome to Giga Cloud Technologies' first quarter 2025 earnings conference call. Joining us today from Giga Cloud are the company's founder, chairman, and CEO, Larry Wu, its president, Dr. Ayman Shrock, and its chief financial officer, Erica Wei. Larry will start with a brief introduction, Ayman will provide an update on the company's operations, and Erica will discuss financial results for the quarter. After that, there will be a question and answer session. As a reminder, this conference call contains statements about future events and expectations that are forward-looking in nature, and actual results may differ materially. Additionally, today's call will include non-GAAP measures within the meaning of SEC Regulation G. When required, a reconciliation of all non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP can be found in the press release issued today by Giga Cloud, as well as on the company's website. I would now like to turn the call over to Larry for his opening remarks. Please go ahead, sir.

Thank you, operator, and welcome everyone to our first earnings call of 2025. We started the year on solid footing with the year-over-year top-line growth of 8%. supported by disciplined operations and execution across the business, despite a challenging industry environment. Our B2B marketplace continued to expand with a 56% year-over-year GMB growth on a trading 12-month basis. As participants derived significant value from many efficiencies we bring to the supply chain for large parts of merchandise, While short-term headwinds persist, long-term fundamentals remain intact. Our marketplace and supplier-fulfilled retailing model streamlines cross-border trade and positions us to capture the growing demand for efficient technology-enabled commerce. And we remain focused on growing Giga Cloud in a disciplined and sustainable manner. A few things we have been focused on lately We continue to execute our integration plan for Noble House. We have started the process of introducing new SKUs with simultaneously optimizing procurement costs through our large network of vendors. While we are still in the early stage of this effort, initial feedback we're seeing has been very encouraging. We're excited for the future as we gradually continue to introduce new, more profitable SKUs while simultaneously retiring less profitable merchandise as we go. We remain focused on growing our marketplace outside of the US. Europe performance continues to be strong with its close to 80% year-over-year growth. We're also receiving increased interest from our 3P sellers for international markets, such as the EU, UK, and Japan. The launch of our Wonder app has been positively received with the promising traction, and we have welcomed a great new partner to our BaaS program as well. We're excited by the long-term potential of these initiatives and remain focused on disciplined execution. With that said, we recognize the recent tariff developments have introduced new complexities into global trade, and the high level of uncertainty has caused disruptions to the supply chain. I want to take a moment to discuss this. Obviously, we cannot see into the future, and we do not know when and how things will play out exactly. With where terrorists currently are and the level of uncertainty, there's no doubt this poses a challenge for many, including us. But we're confident in our ability to manage the challenge to come. I am a firm believer that the best time to prepare for a challenge is before it occurs. And we have been preparing for a long time by always being being razor-focused on efficiency and agility. We designed the Giga Cloud Marketplace to be an open-ended, channel-agnostic, and dynamic ecosystem that supports adaptation as quickly as the market changes. For Giga Cloud and our clients, this means the ability to pivot quickly in terms of both product sourcing and sales channels. The just-in-time approach towards inventory procurement brought by our SFR model also proves to be particularly valuable during times of uncertainty and rapid change. We expect the near-term disruptions for these macro and industry headwinds, but we are confident that the platform we have built positions us to capture outsized opportunities over the long run. As I have said before, periods of uncertainty reveal true strength. Giga Cloud is resilient, adaptable, and experienced. The efficiency baked into our marketplace is precisely what helps us and our partners navigate whatever comes next. Now I will give the microphone to Iman to provide operational updates.

Thank you, Larry. I am pleased to share that our marketplace continues to grow, even as we work through current headwinds. For the trailing 12 months ended March 31st, 2025, GigaCloud Marketplace GMV grew more than 56% to $1.4 billion as buyers and sellers of large parcel merchandise took advantage of the flexibility and efficiencies offered by our SFR business models. Our active 3P seller base grew more than 33% to 1,154, while GMV from this base increased 50% year-over-year to $734 million on the trailing 12-month basis. 3P sellers currently account for about 52% of our total marketplace GMV. Our buyer base is nearing 10,000 for the first time, growing more than 81% year-over-year. we again saw a small reduction in average buyer spend as we continue to onboard a large number of buyers who, as you are aware, generally start on our platform trading with lower volumes and learning and testing. As Larry mentioned, we're driving ongoing momentum in Europe as a result of our focus on diversifying our business. GMB in this region grew over 80% for the first quarter. Looking ahead, we're doubling down on Europe. The fulfillment center we opened earlier this year in Bremen, Germany, has strengthened our regional fulfillment footprint that supports our growth initiatives across continental markets. At the same time, the evolving tariff landscape is encouraging many buyers and sellers to diversify their sourcing and sales channels, and we're well positioned to meet the demand. we're continuing to make progress on the Noble House integration. As a reminder, last quarter we began phase three, which is all about refreshing the catalog to retire the underperforming SKUs and replace them with successful new ones. In the first quarter, we phased out over 400 legacy SKUs and launched more than 300 new ones, helping us keep the assortment fresh while improving inventory efficiency. Looking ahead, we have approximately 600 new SKUs currently in development with rollouts planned over the next two quarters. This constant cycle of product development is critical to the long-term business health. The new SKUs we introduced this quarter are encouraged by the initial feedback from our partners. That said, given how early we are in the process, sales volume from these SKUs are still relatively low and will take time to scale. In general, three to six months are needed for each SKU to ramp up to healthy sales levels. As the catalog continues to evolve and adoption builds, we aim to begin phase four of the integration towards the end of this year, which will focus on driving margin expansion across the channels. Since rebranding and launching our Wonder app, we've been focused on refining the experience through a closed beta phase. While it's still early, we're encouraged by the initial traction. As we continue collecting user insights and advancing development, we look forward to broadening access and sharing further updates in the coming quarters ahead. Importantly, not only is this app ideal for retail stores that are seeking a more efficient method to manage their sales teams, but it also provides suppliers a direct line into retail sales activity enabling better engagement and outcomes at the point of sale. The app is another example of our innovation as we continue to bring added transparency and efficiency into the supply chain. On the Bass front, we're excited to welcome Scott Living, the well-recognized and beloved home brand from Jonathan and Drew Scott, better known as the Scott Brothers and widely recognized from their hit television series, Property Brothers. Their trusted brand presence and strong consumer following brings significant value to our platform and aligns well with our growth strategy. As a reminder, under the BaaS program, marketplace sellers are able to sell and distribute select Christopher Knight Home and Scott Living branded products via a per-skew approval process. Giga Cloud oversees product development, quality control, brand management, fulfillment, and promotional support, ensuring that all branded products meet and exceed industry standards. Thank you again for joining us today. I'll turn things over to Erica for the discussion of our financials in the first quarter.