Tuniu Corporation

Hello, and thank you for standing by for ToonU's 2026 first quarter 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, Drew. And welcome to our 2026 first quarter 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 performance for the first quarter of 2026. Before we continue, I refer you to our safe harbor statement in the 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 gap measures. Finally, please note that, unless otherwise stated, all figures mentioned during this conference call are in RNB. 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 first quarter 2026 earnings conference call. The travel industry maintains solid growth momentum in the first quarter of 2026. Supported in part by the longest Chinese New Year holiday on record, with both domestic and outbound travel markets seeing stable growth. In the first quarter, our net revenues increased by 13 year-over-year. At the same time, we achieved non-GAAP profitability for the fifth consecutive quarter. This year, we will continue to strengthen both our supply chain capabilities and the sales channel development. Supported by the company's strength in products and industry insights, we aim to further enhance our travel resource base and business partnerships. We will also continue to leverage technology tools to improve operational efficiency and deliver high-quality products and services to a broader customer base. Next, I will go through our core strategic initiatives in more detail. On the supply side, we will continue to expand our supplier network across areas such as car rentals, overseas hotels, and the definition experiences. With the aim of further broadening our product offering, also we will integrate demand for both 2NEO and our partners to further strengthen the advantages of our centralized procurement. while maintaining product quality and price competitiveness. Last year, we added connecting flight solutions to our outbound travel products, expanding departure coverage and serving more travelers from lower-tier cities. This year, we are extending our connecting flight solutions to domestic travel products, offering customers more flexible travel arrangements. For certain new tour products, we provide travelers departing from different cities across China with integrated flight solutions. In the event of delays to connecting flights, we will assist customers in completing the remaining segments of their journeys at no additional cost. High-quality products continue to play an important role in attracting our customers and partners. In line with this, new tool has been one of our core high-quality organized tool products, supported by a relatively loyal customer base. To meet involving customer demand, new tool products have expanded into long-haul and more compact destinations. including Africa and South America. This year, we continued to introduce new premium outbound neutral products for experienced travelers, such as North America multi-definition itineraries covering the US, Canada, and Mexico, as well as South America and tactical tools, which have been well received with many repeat customers. In terms of the domestic travel market, we see that customer demand is gradually shifting from traditional sightseeing towards more culture and experience-oriented travel. In response, we have upgraded our organized tour products through introducing more in-depth itineraries focused on single destinations. These products reduce the number of stops within an itinerary focus on core definitions and selected sightseeing attractions, and provide travelers with more time for exploration and local experiences. To further enhance the travel experience, many of these in-depth products are offered in small group and private group tour formats. Certain new tour products also feature experienced senior tour guides to provide in-depth commentary for travelers. We have seen that the number of self-guided travelers has continued to increase. To address the changing needs of this segment, we expanded our HotelPlusX offerings with hotels as the core component. To support this, we have strengthened direct consulting of resort hotels and increased procurement of other travel-related products to broaden our offering. In addition, Supported by AI and dynamic packaging technologies many self-guided travel products are now content-driven for potential bookings After customers input relevant information the system can automatically generate destination recommendations and travel itineraries Customers can then select their preferred elements to customize their own self-guided travel packages, which offers greater flexibility and personalization in the booking process. We have continued to expand our channel's presence Also, together with our partners, we work to better identify customer needs across different channels and have accordingly adjusted our products and services to support product sales. In the first quarter, live streaming Contribution to our total transaction volume further increased to over 20%. Both payment and verification volume continued to record double-digit year-over-year growth. As we continue to gain experience in live streaming and better understand customer preferences, we have introduced more targeted products for different customer segments. For example, for senior travelers, we introduced European tour products with itineraries longer than 15 days. While for family-oriented customers, we promoted customized Singapore tours and private globe products. These targeted initiatives improved customer acquisition efficiency and contributed to higher verification rates. In addition, we continued to extend live streaming to definition-based scenarios. For example, we conducted onboard livestream sessions from cruise ships, providing customers with a more direct understanding of destinations and helping drive both booking and verification. In the first quarter, our offline store business continued to grow. with transaction volume increasing by nearly 30 year-over-year. Offline stores continued to play an important role in the sales of organized tour products and the promotion of two new brands. We fully opened our systems and product offerings to offline stores. enabling them to expand our reach into lower-tier markets and provide customers in lower-tier cities with access to a broader range of travel products, particularly outbound travel products. This year, we plan to continue expanding our offline store network In addition, we are further broadening our channel partnerships backed by our solid supply chain, quality products and advanced technology tools. Our X2B2C model enables us to efficiently provide business partners with a broad range of products and services to meet the needs of their end customers. This collaborative approach creates value for both sides. 2NEW is able to connect the supply and demand more efficiently, lower customer acquisition costs, and expand sales skills. While partners can offer high-quality travel products and services, to better sell and retain their customers. Going forward, we will continue to expand our partner network and jointly sell a broader customer base. In terms of technology, we will continue to explore the application of AI technology across various business scenarios this year. Further, integrating automation tools into more operational processes. Through ongoing tool upgrades and improvements to our regular operations, BI tools can assist assist employees in handling more repetitive tasks, allowing them to focus on more compact and innovative work. On the customer side, technology tools such as itinerary recommendations Standalone product booking and dynamic packaging provide customers with a more intelligent, convenient, and efficient booking experience. In particular, self-guided travelers can leverage AI-assisted tools to customize travel products based on their own preferences and needs. This year, the travel market has seen a growing number of peak travel periods. Following the spring break and the recent holidays in the second quarter, the summer travel season is approaching. This presents both opportunities and challenges. We will continue to strengthen the supply, sales, and service capabilities of our seasonal travel products and work closely with sales channel partners to provide more customers with simple, convenient, and high-quality travel experiences. I'll now turn the call over to Anqiang. our financial controller for the financial highlights.