Uxin Limited

Ladies and gentlemen, thank you for standing by and welcome to Yu Xin's earning conference call for the quarter ended September 30th, 2025. At this time, all participants are in a listen only mode. After management's prepared remarks, there will be a question and answer session. Today's conference call is being recorded. If you have any objections, you may disconnect at this time. I would now like to turn the call over to your host for today's conference call, Ms. Allie Wong. Please go ahead, Allie.

Thank you, operator. Hello, everyone. Welcome to U.S. Earnings Conference Call for the third quarter, end of September 30th, 2025. On the call with me today, we have DK, our founder and CEO, and John Lin, our CFO. DK will review business operations and company highlights, followed by John, who will discuss financials and guidance. They will both be available to answer your questions during the Q&A session that follows. Before we proceed, I would like to remind you that this call may contain forward-looking statements which are...

Hello everyone, and thank you for joining YouTube's earnings conference call today.

It is a pleasure to reconnect with our investors through this call, and we appreciate your continued interest and support. To better facilitate communication with both our domestic and international investors, I will be sharing our latest business updates in both Chinese and English.

In the third quarter of 2025, our performance maintained a trend of high growth. In the quarter, sales fell to 14,020 units, which increased by 134% in the same period as last year. In six consecutive quarters, sales were more than 130%. In the third quarter of 2025, we continue to build strong growth momentum.

Retail transaction volume reached 14,020 units, representing a 134% year-over-year increase and marking the sixth consecutive quarter of year-over-year growth above 130%. Despite a significant expansion in inventory, our inventory turnover remained at around 30 days. Customer satisfaction also remained at an industry-leading level. Our net promoter score was 67.25, sustaining a level of 65 or above for six consecutive quarters, the highest in the industry. At the same time, profitability continued to improve, with growth margin increasing to 7.5%, the highest level we have achieved in the past three years.

新卖场的拓展也在按计划顺利推进中, This week, we invested in the market in Jinan, including the Wuhan and Zhengzhou markets that opened previously. The landing plan for the three new markets in 2025 has been completed. The Wuhan market that opened in February this year sold nearly 1,800 units in December. The market share is close to 10%, and it is still in a state of rapid growth. The Zhengzhou market that opened at the end of September is now only three months old. The sales of sales in December are expected to be about 900 units, which is close to 5% of the market share. It is already the largest second-hand car seller in Zhengzhou. The expansion of our Superstore network has also continued to progress smoothly and in line with our plan.

Earlier this week, our Jinan Superstore officially commenced operations. Together with the Wuhan and Zhengzhou super stores that opened earlier this year, we have now completed all three new super store opening plans for 2025. Our Wuhan super store, which opened in February, is expected to reach nearly 1,800 retail units in December, with local market share approaching 10%. The store continues to operate in a phase of rapid growth. Meanwhile, our Zhengzhou Superstore, which opened in late September, has been operating for just three months and is already expected to achieve approximately 900 retail units in December, with market share nearing 5%. Zhengzhou has already become the largest used car retailer in its local market, and both its sales ramp-up and profitability trajectory are progressing faster than what we experienced at the Wuhan Superstore. With these additions, we now have five super stores in operation. The continued ramp-up of newly opened locations, together with sustained growth across our existing stores, will remain a key driver of the company's performance going forward.

In addition, we have recently announced strategic cooperation with the local government of Tianjin, Guangzhou, and Yinchuan to jointly invest in and operate the second-hand super market. Over the past few months,

We have announced strategic partnerships with local governments in Tianjin, Guangzhou, and Yinchuan to jointly invest in and operate new used car super stores. Each of these projects is designed to support a capacity of more than 3,000 vehicles for display and sale. These partnerships extend our service coverage across northern, northwestern, and southern China, further strengthening the foundation for our long-term growth. Meanwhile, we are actively advancing superstore projects in several other cities, and we plan to open four to six additional superstores in 2026, marking a transition into a phase of accelerated nationwide expansion for our business.

U-SYNC's business model has a clear path to success in cross-region replication across the country. The core is the joint operation of three key capabilities. More accurate pricing, high satisfaction and higher efficiency. First of all, the pricing model based on machine learning is getting bigger and bigger, and the real trading data that can be used to train the pricing system is getting more and more, and the pricing is getting more and more accurate, ensuring that each car has real market competitiveness and maintains a high turnover efficiency of 30 days. Secondly, by providing high-quality, high-performance R&D products and professionally guaranteed services, we can improve customer satisfaction and recommendation rates, and form a positive spread of taste. Finally, the factory warehouse retail integrated all-round road is strongly controlled. By now, we believe that Yuxin has established a clear and proven path to scaling its business model nationwide, driven by the coordinated execution of three core capabilities that are more precise pricing,

higher customer satisfaction, and superior operating efficiency. First, our machine learning-based pricing system becomes increasingly effective as our retail scale expands. With a growing base of real transaction data used to train our models, pricing accuracy continues to improve, ensuring that each vehicle is competitively priced in real time. This allows us to maintain high inventory turnover of around 30 days, Second, our landmark large-scale superstores play a critical role in enhancing the customer experience. By offering high-quality, competitively priced vehicles supported by professional and reliable services, we are able to consistently improve customer satisfaction and referral rates, creating a self-reinforcing cycle of brand trust and organic growth. Third, our fully integrated factory logistics Retail operating model enables end-to-end control across procurement, reconditioning, and retail sales. This model delivers operational efficiency that significantly outperforms traditional used car dealers while remaining highly standardized and replicable. As a result, new super stores reach maturity faster and losses during the early ramp-up phase are more predictable and better controlled.

As long as the market conditions remain stable, we are highly confident in the sustained and rapid growth of our business.

As such, for the fourth quarter, we expect our retail transaction volume to exceed 18,500 units, representing a year-over-year growth of more than 110%. For the full year 2025, we expect retail transaction volume to surpass 50,000 units, reflecting year-over-year growth of more than 130%.

With that, I'll turn the call over to our CFO to walk you through the financial results.

John, please. Thank you, DK.

Hello, everyone. I will continue to present the company's performance in both Chinese and English to better communicate with all of you.

本季度我们的业绩表现非常强劲。 零售销量14,200台,同比增长134%,环比增长35%。 原有卖场的销量正在持续增长,新卖场也陆续投入运营。 预期未来几年我们的零售销量都将保持高速的增长。

In the third quarter, our retail transaction volume reached 14,020 units, representing a 134% increase year-over-year and a 35% increase quarter-over-quarter. Sales at our existing superstores continue to grow, while new superstores have come into operation progressively. Looking ahead, we expect our retail transaction volume to maintain a high growth trajectory over the next several years.

The total sales revenue is 8.2 billion RMB, which increased by 84% in the same year, and increased by 35% in the same year. The average sales price of sales vehicles, ASP, is 5.8 million yuan, which was 5.9 million yuan last quarter. In the same period last year, it was 7.4 million yuan. The increase in sales has greatly reduced the impact on the level of income of the vehicle. Our current vehicle storage satisfies the needs of most consumers. The average price of a single vehicle is already at a relatively reasonable level.

Retail revenue for the quarter totals 820 million RMB, up 84% year-over-year and 35% quarter-over-quarter. The average selling price for ASP for retail vehicles was 58,000 RMB compared to 59,000 RMB in the prior quarter and 74,000 RMB in the same period last year. While ASP declined as we shifted toward a more affordable inventory mix, The strong growth in transaction volume more than offset the pricing impact and drove our overall revenue extension. Our current inventory structure is well aligned with mainstream consumer demand, and we believe pricing has now stabilized at a rational level. As such, we expect ASP to remain relatively steady in the near term.

车辆批售方面,三季度的批售销量1884台,同比增长81%,环比增长54% The total income of wholesale is 33.2 million RMB. The total income of wholesale and retail is 8.79 billion RMB. The total income of wholesale and retail is 8.79 billion RMB.

The total income of wholesale and retail is 8.79 billion RMB. The total income of wholesale and retail is 8.79 billion RMB. The total income of wholesale and retail is 8.79 billion RMB. The total income of wholesale and retail is 8.79 billion RMB. total wholesale revenue was 33.2 million RMB. Combining both retail and wholesale, total revenue for the quarter reached 879 million RMB, representing a 77% increase year over year and a 34% increase quarter over quarter.

本季度的毛利率是7.5个百分点, 较去年同期7%增长了0.5个百分点, 较上个季度的5.2%增长了2.3个百分点, It has reached a new high in the past three years, which is mainly due to the integration of new car market value in China in the third quarter, which drives a quick recovery of the profit level of the second-hand car market. At the same time, the Wuhan market, which opened in February this year, has now entered the initial stage of operation. The interest rate is also constantly climbing, and it has actively promoted the revival of the current interest rate.

Gross margin for the quarter was 7.5%, up 0.5 percentage points from 7% a year ago, and up 2.3 percentage points from 5.2% in the prior quarter, marking the highest level over the past three years. The improvement was primarily attributable to the easing of the price competition in the new car segment during the third quarter, which supported a rapid margin recovery in the used car market. In addition, our Wuhan Superstore, which opened in February has moved beyond its startup phase, with margin performance continuing to ramp up and driving a meaningful lift to this quarter's growth margin. Adjusted EBITDA for the quarter narrowed significantly to 5.3 million RMB, representing a substantial 43% reduction year over year, and a 68% reduction quarter over quarter.

对四季度的业绩展望, 我们的零售销量预计将超过18,500台, 同比增长超过110%, 总销售收入预计超过11.5亿人民币, 那2025年的全年零售销量预计超过5万台, 同比增长超过130%。

Looking ahead to the fourth quarter of 2025, we expect retail transaction volume to exceed 18,500 units representing year-over-year growth of over 110%. Total revenue is expected to exceed 1.15 billion RMB. For the full year 2025, we expect retail transaction volume to exceed 50,000 units representing year-over-year growth of over 130%.

That concludes our prepared remarks for today.

Thank you, everyone. Operator, we're now ready to begin the Q&A session.

We will now begin the question and answer session. To ask a question, you may press star then 1 on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then 2. Once again, to ask a question, please press star then 1 on your touchtone phone. At this time, we will pause momentarily to assemble our roster. Once again, to ask a question, please press star then 1 to join the question queue. That's star then 1 to join the question queue. The first question today comes from Dai Wenjie with SWS Research. Please go ahead.

谢谢管理层,我是深外汽车的分析师戴文杰。 非常荣幸,首先恭喜公司, 本季度的毛利率已经达到了7.5, 过去三年的历史新高。 我的问题是想请教一下, 公司如何看待当前的毛利率水平的可持续性? OK. Congratulations. And now we see growth margin reached 7.5% this quarter, three years high. How does measurement view the sustainability of the current margin level? And what factors could further drive margin improvement to go forward? Thank you.

Okay, so I'll answer this question. Our profit margin in this quarter is 7.5%, which is also the highest number since our transformation to the self-sufficiency model. I just mentioned that we have two main reasons. One is the stability of the new car's sales. The profit level of the second quarter naturally rose. For example, our original sales, the profit margin of Xi'an and Hefei sales, has actually reached more than 8%. The second quarter has improved by nearly 2%. This quarter's growth margin was 7.5%, representing a new high since we transitioned to the self-operated model, and there are two main drivers behind this improvement.

New car pricing has stabilized, which naturally supports a recovery in used car profitability. At our existing Xi'an and Hefei Superstores, growth margin exceeded 8%, up nearly 2.6%. Second, profitability at our new Wuhan Superstore has also been improving. Our Wuhan Superstore Officially opened in February and started from the third quarter, its growth margin has improved significantly compared with the early operation phase in the second quarter.

We believe that there is still a lot of room for growth in the interest rate. First of all, with the deep implementation of the state-owned car industry, the future price of cars will remain stable or rise, which will have a positive effect on our interest rates. Looking ahead, we believe there is still substantial room for further margin extension.

First, as China continues to implement policies aimed at reducing excessive competition in the auto industry, we expect vehicle prices to remain stable or even trend upward over the coming quarters. which would be supportive for our margins. Second, as DK just mentioned, our data-driven pricing capabilities continue to improve. Pricing errors are becoming less frequent, and the proportion of loss-making vehicles is declining.

In addition, the penetration rate of our increased service actually has a lot of room for improvement. As our increased revenue contribution increases, our profit will also improve further.

Finally, our value-added services still have significant penetration upside. As higher margin ancillary revenue contributes more meaningfully to our revenue mix, this will further lift our growth margin.

From a long-term perspective, our net profit target is around 10%. We have seen a net profit of close to this target in Xi'an and Hefei. We still have enough confidence in the future overall net profit improvement.

Over the long term, our target growth margin is around 10%. At our existing C&A and Hefei Super Source, we are already seeing growth margin approaching best target, which gives us strong confidence in continued margin extension.

Okay.

That's my answer. Thank you.

Thank you. Thank you very much.

The next question comes from Fei Dai with TS Securities. Please go ahead.

管理层好,我是天方正寸的分析师戴菲。 感谢刚才管理层的分享,我这边有两个问题。 第一个问题是想请教一下, 郑州卖场开业后的销量和盈利水平提速优于武汉卖场。 管理层能否分享一下公司主要做了哪些举措? 以及对未来新开卖场达到稳定运营状态所需时间的整体预期或者是目标区间是什么? My first question is following the opening of the Zhengzhou Superstore, both sales and profitability ramp up seems to be faster than what we saw in Wuhan. Could management share what key initiatives drop this outperformance? And looking ahead, how long do you expect newly opened superstars to take to reach stable operations? Thank you.

Okay, thank you for your question. Okay, let me answer the first question first. Okay, let me answer the first question first. Okay. The Zhengzhou market has been invested in for three months, with a monthly sales of up to 900 units. The profit level is also higher than that of the Wuhan market at the same time. On the one hand, the Wuhan market can actually be considered to be the first new market to be copied by our market. Performance has been significantly better than Xi'an and Hefei. The Zhengzhou market has also gained valuable experience from the construction and production of the Wuhan market to achieve the storage sales and the rapid escalation. The organizational system is also more smooth.

Thank you for your question. Our Jingzhou Superstore has only been operating for about three months, and monthly sales have already reached 900 units. Its profitability is also higher than what we saw at the same stage for the Wuhan Superstore. On the one hand, our Wuhan Superstore can be viewed as the first large-scale replication of our Superstore model, and it's already performing meaningfully better than our Xi'an and Hefei Superstores. Zhengzhou in turn benefited directly from what we learned in Wuhan from construction and launch to inventory build and sales ramp up. So our organization and operating systems are running more smoothly.

On the other hand, as our sales volume expands, we now have a much larger pool of real transaction data to train our pricing system.

This has further improved our pricing capability. The pricing system has adapted more effectively to the jungle market with more precise pricing, which helps ensure sales efficiency and supports stronger profitability in the early stages of operation.

Currently, it takes about nine months for a new market with a size of 3,000 units to reach a balance of profit and loss. Wuhan is at this level.

For a standard new superstore with a planned capacity of approximately 3,000 vehicles, our current expectation is that it reaches break-even in about nine months. This is consistent with what we achieved at the Wuhan Superstore. We expect inventory to reach its planned capacity in about 18 to 24 months. at which point both sales volume and profitability should reach a mature and stable level.

My second question is, U.S. user card company Carvana recently surpassed a $100 billion market cap. Could management comment on the key similarities and difference between Carvana's model and using it? Thank you.

Carvana is the leading second-hand car company in the U.S. Its performance in the capital market is also very good. We did some research on Carvana. Please go ahead.

Carvana is a leading used car company in the U.S. and has delivered very strong capital market performance. We have conducted in-depth research on Carvana.

In terms of the model, the biggest difference is in the sales channels. Kawana has online sales, while Youxin has online sales and online marketing channels. Youxin currently has more than 70% of online sales. Online sales account for about 30%. This is due to the current situation in China and the United States. Car consumption accounts for a larger proportion of Chinese families' assets, so Chinese consumers buying cars is a more cautious strategy. Starting with the differences, the biggest distinction is the sales channel.

Havana sells online while Houston operates through both offline super stores and an online marketplace. Currently, over 70% of our sales come from offline super stores. with online contributing roughly 30%. This mainly reflects the different market realities in China and the US. At this stage in China, a car typically represents a larger share of a household's assets, so people make purchase decisions more cautiously. As a result, many consumers still want an in-store experience and a test drive before buying a used car. Over time, as auto consumption continues to develop and trust in the used car market keeps improving, we do expect the online share to increase as well.

当然我们有很多相同的地方,第一就是都选择了自由库存的模式,通过自营的整备工厂对车辆进行大规模整备,强管控每一个业务环节,降低单车的成本,提升车辆的流转效率。

That said, we share many similarities. First, both companies operate under an own inventory model with large scale reconditioning through a self-operated facilities and tight control over every step of the process to reduce per unit cost and improve inventory turnover efficiency.

Second, given that used cars are a highly non-standardized product,

Both Carvana and Yuxin focus on precise pricing to ensure efficient vehicle turnover. Carvana's annual retail volume is around 500,000 units, while Yuxin currently sells about 50,000 units per year. These real transactions form the most critical training data for pricing models. As our retail scale continues to expand, we expect our pricing capabilities to further strengthen.

Third, we put the improvement of customer satisfaction and reputation in the priority position. Kawana's NPS is more than 80%. Our NPS this quarter has increased to 67%. We have maintained the highest level of the industry for several consecutive seasons. Good reputation proves that we create value for customers and bring more traffic to us.

Third, both companies prioritize customer satisfaction and brand reputation. Carvana's NPS is above 80, and our NPS reached 67 this quarter and has remained at the highest level in the industry for more than a dozen consecutive quarters. Strong word of mouth reflects the value we deliver to customers and also drives incremental referral traffic.

Today, Yuxin is a used car company with annual retail volume of approximately 50,000 units.

We are highly confident that by continuing along our current development path, we can sustain year-over-year sales growth of more than 100% over the next several years and reach Carvana's current sales volume within four to five years. That's all I wanted to share. Thank you.

Thank you, Guan Yicheng.

This concludes our question and answer session. I would like to turn the conference back over for any closing remarks.

Thank you all for participating on today's call. We are looking forward to reporting to you soon.

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.