Tuniu Corporation

Hello, and thank you for standing by for TUNY's 2025 Fourth Quarter and Full Year Earnings Conference Call. At this time, all participants are in listen-only mode. After management's prepared remarks, there will be a question and answer session. Today's conference is being recorded. If you have any objections, you may disconnect at this time. I would now like to turn the meeting over to your host for today's conference call, Director of Investor Relations, Mary.

Thank you, Betsy. And welcome to our 2025 Fourth Quarter and the Four-Year Earnings Conference Call. Joining me on the call today are Donald Yu, 2NEWS founder, chairman, and chief executive officer, and Anqiang Chen, 2NEWS financial controller. For today's agenda, management will discuss business updates operation highlights and financial information performance for the fourth quarter and the fiscal year 2025. Before we continue, I refer you to our safe harbor statement and earnings press release, which applies to this call, as we will make forward-looking statements. Also, this call includes discussions of certain non-GAAP financial measures Please refer to our earnings release, which contains a reconciliation of non-GAAP measures to the most directly comparable GAAP measures. Finally, please note that, unless otherwise stated, all figures mentioned during this conference call are in RMB. I would now like to turn the call over to our founder, chairman, and chief executive officer, Donald Yu.

Thank you, Mary. Good day, everyone. Welcome to our fourth quarter and four-year 2025 earnings conference call. In the fourth quarter, our business continued to maintain solid growth momentum. Net revenues increased by 20% year-over-year, exceeding our previous guidance. While revenues from our core package tour products grow at an even faster pace, rising 35% year-over-year. At the same time, we achieved profitability for both the quarter and the year. This also marks the third consecutive year following the pandemic in which we have delivered a four-year non-GAAP profitability. We have announced a long-term shareholder return plan totaling up to US$50 million to be carried out during the three-year period from March 2026 via cash dividends and share repurchase fees. This plan reflects both our commitment to provide shareholders with sustainable returns and our confidence in the long-term outlook of the travel industry. The travel market continued to grow in a healthy manner in the past year. The extension of national holidays and other favorable policies further stimulated domestic travel demand. while the increasing number of visa-free destinations made it easier for Chinese travelers to explore more destinations overseas. In 2025, we adopted a more proactive product strategy by differentiating our products and product lines. We targeted distinct customer segments and offered a richer, more tailored portfolio based on customer needs. Meanwhile, we leveraged our supply chain growth to enhance price competitiveness and attract more customers. During the year, we continued to pursue an open and collaborative approach, attracting high-quality partners to expand new channels and enhance service quality for our customers. Contributions from channels such as live streaming, offline stores, and corporate clients continued to increase as the share of 2NEWS transaction volume. In addition, we actively embraced new technologies leveraging innovation tools to further enhance our product and service, and improve operational efficiency. Now I will walk you through our key achievements in more detail. First, our strong supply chain remains the foundation for delivering high-quality and price-competitive products In 2025, we further enhanced our direct and centralized procurement strategy in order to lower purchasing costs. Moreover, based on customer needs and pain points, we consolidated flight resources and introduced several connecting flights for select long-haul travel products to niche destinations. This approach further expanded our departure city coverage, making it more convenient for travelers from lower tier cities to travel abroad. It also enabled us to take advantage of airline discounts available in those hubs. allowing us to offer even more competitive pricing to our customers, and further boosted demand for related destinations. Many hub cities, such as Chengdu and Urumqi, are popular tourist destinations themselves. allowing travelers to combine stopovers with nearest visits. As a result, these products gained strong traction upon launch. For example, our Caucasus series using connecting flights recorded over 500% year-over-year growth in transaction volume in 2025. We will continue to expand these offerings by adding more department points and definitions. In terms of products, we continue to adopt a differentiated strategy to better serve distinct customer segments. As the core customers of our new tool products, Experienced travelers and repeat customers tend to prioritize the travel experience and typically have greater flexibility in both time and budget. In 2025, new tours introduced a wider range of niche destination products, including the organized tours products to the Caucasus region in April and to South America in October. At the same time, we further enhanced the travel experience of new tour products by implementing a zero-shopping policy throughout the trip, and some including curated experiences such as Michelin-starred dining and helicopter tours. In the second half of 2024, we launched our New Select series, offering a wider range of cost-effective products and further expanding to new price tiers. In 2025, we expanded our New Select offerings to cover a broader array of international destinations. With more competitive pricing, the new Select products have attracted a wider customer base, enabling travelers to either reduce their travel budgets or explore additional destinations within the same budget, an option that strongly appeals to travel fans, particularly younger ones. The new Select Singapore-Malaysia tour series launched in June last year, recorded over 10,000 paid bookings during the summer holiday period. We also observed a continued rise in demand for self-guided tours, particularly in the domestic travel market. Last year, we expanded the supply of our HotelPlusX products with hotels as the core and supported by dynamic packaging technology. We broaden the coverage to all provinces in China, Chinese mainland, and further penetrated lower-tier markets. During the 2025 Labor Day and National Day holidays, Transaction volume for our self-drive tool products recorded a triple-digit year-over-year growth. Going forward, we will continue this strategy by expanding the supply and destination coverage of our self-guided tool products. In addition, in 2025, we continued to explore and expand diversified channels. Live streaming is playing an increasingly important role for ourselves. In 2025, both payment and verification volume through our live streaming channel continued to record double-digit year-over-year growth while achieving profitability through a single channel. Live streaming channel contributed over 15% to our total transaction volume in 2025 compared to approximately 10% in 2024. On the product side, First, we expanded the range of live streaming offerings. Beyond the traditional hotel plus scenic spot packages, we added personalized service products such as travel photography, as well as more high-ticket items like long-haul outbound travel products, enriching customers' choices. Second, we fully leverage our supply chain advantages to ensure competitive pricing. For example, our new sex products are highly popular with live stream audiences due to their good value for money. In terms of format, we increased the number of our outdoor live streaming shows. including inviting live streamers to broadcast live from destination sites. In March last year, 2NEW partnered with multiple live streamers to conduct a 21-day on-site live streaming campaign across 10 islands in the Maldives, generating cumulative sales of over 100 million RMB. On the service side, with more than a decade of experience in the travel industry, we provide professional tour guidance and comprehensive travel-related services. In addition, we have a dedicated verification team and specialized system support in place to deliver a smoother redemption experience for customers. Offline stores remain an essential part of our overall sales and service network. As of the end of 2025, we operated more than 400 stores nationwide. We expanded our store presence in key cities, including major popular tourist destinations and transportation hubs such as Chengdu and Xi'an, building skills in local markets to enhance operational efficiency and reduce costs. In 2025, transaction volume from offline stores increased by nearly 20% year-over-year. We also continued to develop channels such as traffic platforms and corporate clients, tailoring our product offerings to the specific needs of each channel. On traffic platforms, sales of standalone products such as air tickets and hotel bookings grow rapidly. For corporate clients, in addition to providing business travel booking service, we leveraged our extensive experience in the leader segment to offer customized group travel solutions, as well as personal and family location products for employees. In the fourth quarter of 2025, transaction value from corporate clients increased by more than 20% year-over-year. In terms of technology, we are exploring the application of AI agents across various business scenarios. Last April, 2NEW officially launched our self-developed travel agent, travel AI agent, AI Assistant XiaoNiu. The Assistant integrates vertical travel application scenarios with large language models to provide customers with one-stop services, including smart search, automated price comparisons, personalized recommendations, and dynamic packaging. At the same time, we continued to integrate technological tools into our daily operations. These initiatives have improved efficiency and helped control operating costs. We are encouraged by the growing adoption of our AI tools among both customers and employees. In addition, we have adopted an open collaboration approach by gradually providing external AI agents such as OpenClaw, with the same comprehensive travel booking capabilities available in our app via MCP interface, enabling them to search and place bookings directly. We will continue to embrace new technology to support high-quality growth. Over the past year, we made steady progress while managing a range of challenges. Overall, the company continues to move forward on the sustainable development path. In the year ahead, we will remain focused on customer needs, continue refining our products and services, and expand our reach through diversified channels to support stable and sustainable growth. I will now turn the call over to Anqiang, our financial controller for the financial highlights.