WeRide Inc.

Good morning and good evening, ladies and gentlemen. Thank you for standing by and welcome to REWRITE's fourth quarter and full year 2025 earnings conference call. Please note that today's event is being recorded. At this time, all participants are in listen-only mode. For today's call, management will use English as the main language. A third-party interpreter will provide simultaneous Chinese interpretation. The company will be hosting a question and answer session after management's prepared remarks. If you wish to listen to management's original statements or ask a question during the question and answer session, please make sure you are dialed into the English language line. Please note that the Chinese interpretation is for convenience purposes only. In the case of any discrepancy, management statements in their original language will prevail. Joining us today are WeRights founder, chairman, and CEO, Dr. Tony Han, and CFO and head of international, Ms. Jennifer Lee. Before we continue, I'd like to refer you to the safe harbor statement in the company's earnings press release, which also applies to this call, as today's call will include four looking statements, including WeRights strategies and future plans. These forelooking statements are made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forelooking statements involve inherent risks and uncertainties. The company's actual results could differ materially from those stated or implied by these forelooking statements as a result of various important factors, and please refer to the risk factors section of the company's Form 20F filed with the SEC and announcements on the website of the Hong Kong Stock Exchange for a full disclosure of these risk factors. The company does not assume any obligation to update any forelooking statements except as required under applicable law. Please note that all numbers stated in management's prepared remarks are in RMB terms and we will discuss non-IFRS measures today which are more thoroughly explained and reconciled to the most comparable measures reported in the company's earnings release and filings with the SEC and the Hong Kong Stock Exchange. The company's unaudited financial and operating results were released earlier today via Newswire and can be found on the company's IR website. And with that, I now turn the call over to the company's founder, chairman and CEO, Dr. Tony Han, please go ahead, sir.

Hi, everyone. Thank you for joining us today. As a global leader in autonomous driving, we delivered strong results over the past year with a record high revenue of RMB 685 million, growing 90% year over year. driven by expanding Robotaxi deployments as well as robust demand for RoboBus and other autonomous driving products. Robotaxi revenue has increased 210% year-over-year, reflecting the continued commercialization of our technology. By today, our global Robotaxi fleet size has reached the new height of 1,125 vehicles, We are seeing encouraging momentum across both our domestic operations in China and our international markets. As we continue to scale, I'll walk you through the key developments driving our growth, leveraging large-scale data training and world model simulation, as well as improving algorithm generalization. We also made solid progress in operating efficiency, fleet expansion, service coverage, and user adoption. On the operation front, total cost of ownership decreased by approximately 38%, driven by reduction of vehicle bump costs and the improvements of operating efficiency. The bump costs of our latest robotaxi GXR is cut by 15%, enabled by the adoption of our cost-effective computing platform HPC 3.0. At the same time, our remote assistance human to vehicle ratio improved from 1 to 10 in 2024 to 1 to 40, currently making labor cost marginal and further strengthening unit economics. Fleet size and service coverage also continue to improve. Our commercial and testing fleet in China has grown to more than 800 robotaxis, covering over 1,000 square kilometers across key urban areas. As fleet density increased, we also saw meaningful improvements in service performance. Average daily orders per vehicle reached 15 trips over the past six months, rising to 26 during peak periods. Average passenger waiting time declined to under 10 minutes, reflecting stronger demand and improved vehicle utilization. We continued expanding our presence in Beijing and Guangzhou, focusing on populated areas, connecting key transportation hubs such as major airports and railway stations, along with further penetration into downtown areas. In Guangzhou, for example, our robotaxi service is now available in Tianhe District, one of the city's most active commercial hubs. On the product side, we launched a flexible free poodle feature, allowing riders to select any pickup or drop-off location within the service area. At the same time, we broadened access through major mobility platforms, including AMAP, WeChat, and Tencent Mobility. Encouragingly, we are seeing substantial increase of registered users of WeRide Robotaxi service. Take the fourth quarter as an example. The year-over-year growth of registered users exceeds 900%, reflecting stronger user acceptance and engagement. Overall, we believe we ride long-standing leadership in Robotaxi technology, combined with extensive real-world operational experience, forms a durable and hard-to-replicate competitive mode, continues to resonate with users. At our operations scale, we expect further growth in vehicle utilization and user adoption going forward. Let's now turn to our international operations, where we continue to build on our progress, expanding our global footprint. Today, we have deployed autonomous vehicles in 12 countries, with official permits already granted in 8 of those markets. This progress demonstrates our ability to navigate complex regulatory environments while meeting local requirements. Taken together, these milestones position us as the most globally deployed autonomous driving company today. Europe is shaping up to be another major growth area for us. Back in November 2025, we achieved a historic milestone. receiving Europe's first-ever driverless robotaxi permit for passenger service from Switzerland's Federal Roads Office. That head start gives us a real advantage as we look to expand further across Europe in the coming years. Apart from this, just this month, we added another country to our global map as we announced our entry into Slovakia. We are deploying our full product line up there launching the country's first-ever AV program. Slovakia is also the fourth country for our European footprint. The Middle East remains one of the most promising regions. In Abu Dhabi, we secured the world's first city-level fully driverless robotaxi commercial permit outside the US in October 2025. Today, our service covers about 70% of the city's core area. and passengers can book through various categories on Uber app, including Uber Comfort, UberX, all the new autonomous category, Uber's first dedicated autonomous ride option globally. In that quarter, we also launched commercial robo-taxi rides in both Dubai and Riyadh. We've also started pilot operations in Ras Al Khaimah, giving us a presence in a third UAE emirate. In Asia Pacific, we are building early momentum with strong local presence. In Singapore, WeRide and Grab began autonomous vehicle testing in the Punggol district back in November 2025. Our RoboTaxi, GXR and RoboBus are expected to open to the public by April 2026, making Punggol Singapore's first residential neighborhood with an autonomous shuttle service. A big part of what makes all this possible is our disciplined approach to international expansion. Our strategy focuses on markets with supportive regulatory environments and favorable economic conditions that are conducive to sustainable operations. Today, our international Robotaxi fleet has surpassed 250 vehicles, and we continue to scale deployments across key international markets, including Abu Dhabi, Dubai, Riyadh, Switzerland, Slovakia, and Singapore. Each new market we enter becomes a regional blueprint for expansion into adjacent markets. Looking ahead, we expect our global robo taxi fleet to reach 2,600 by the end of 2026, subject to regulatory approvals and market conditions. These milestones represents the early stage of our long-term vision to deploy tens of thousands of robotaxis worldwide by 2030. While robotaxis services at the core of our business, we are actively diversifying to other areas of autonomous mobility to build a broader portfolio and generate additional revenue streams. Across our diversified applications, we ride global AV fleet spending robo-taxes, robo-buses, robo-vans, and robo-sweepers grew rapidly from 1,089 vehicles at the end of 2024 to 2,113 as of today, strengthening our global presence across 12 countries. Take our robo-bus business as an example. It has seen impressive growth in 2025, increasing by 190% year over year. We've entered multiple European markets, including Switzerland, France, Belgium, Spain, and Slovakia, where labor shortages in public transit systems are creating real opportunities for autonomous shuttles. By leveraging our technology to meet this demand, we're able to address a pressing need while also expanding our market presence. Additionally, our L2 Plus Advanced Driver Assistance System, vPILOT 3.0. vPILOT 3.0 is being adopted by leading OEMs and Tier 1 suppliers, including Sherry, GAC, and Bosch. This system uses a one-stage end-to-end architecture with vision-based perception enables vehicles to operate safely and efficiently across diverse driving conditions. In the second China Urban Intelligent Driving Competition hosted by D1EV.com, Sherry Exceed, a mass-market passenger car model powered by V-PILOT 3.0, made history by winning first place in three cities' competition stops. This business expansion helps us capitalize on the growing demand for L2 Plus ADAS technologies, even outside of our L4 fleet. Innovation remains at the heart of our strategy. Building on our strengths in L2 Plus end-to-end systems, WeRide is converging its technology stack toward L4 by integrating end-to-end learning with large-scale simulation, and real-world data loops to enhance generalization and edge case handling. Our latest development, WeRide Genesis, is a general-purpose simulation platform that integrates physical AI and generative AI. WeRide Genesis generates high-fidelity driving scenarios much more efficiently, reducing simulation time for complex edge cases from days to minutes. This boosts our development efficiency and enables us to quickly test and deploy improvements to our systems, while significantly reducing on-road testing costs, reinforcing the technological mode, underpinning our L2 to L4 product portfolio. On the hardware side, we've taken our partnership with GDFriesen to the next level. The latest GXR as a purpose-built, factory pre-installed autonomous vehicle is delivering higher safety consistency and lower unit cost. The upgraded model incorporates our proprietary HPC 3.0, a high-performance computing platform, which is a more compute-efficient architecture. And here's the number that really shows the efficiency gain. Per vehicle production time is now under 10 minutes. These advancements will give us a significant edge in terms of both vehicle performance and scalability of our global robot taxi fleet. With that overview, I'll now turn the call over to our CFO, who will walk you through our financial performance and outlook in more detail.

Thank you, Tony. Hello, everyone. Before we dive into the financials, I want to highlight that all figures are in RMB and comparisons are year over year. unless stated otherwise. Now let's discuss our fourth quarter and full year 2025 financial performance. Looking back, Q4 2025 will be remembered as a defining chapter in WeRise's journey, as we continue to make steady progress in scaling operations, improving unit economics, and advancing our technological leadership. Our fleet and geographic coverage grew significantly, showing strong momentum as a global leader in autonomous driving. Now, let me walk you through the financial performance that reflects these developments. In Q4 2025, total revenue was $314 million, representing an increase of 123%. Product revenue increased 309% to $211 million, mainly driven by increased sales of robo-taxes and robo-buses. Service revenue increased 15% to $103 million. For the full year 2025, total revenue increased 90% to record high $685 million. Product revenue and service revenue were $360 million and $325 million respectively, representing an increase of 310% and 19% respectively. Robotaxi continues to be one of the most crucial drivers among the business lines. In Q4 2025, WeRide has reached another record high quarterly Robotaxi revenue since its foundation, as its Robotaxi revenue has increased 66% to 51 million. For the full year 2025, Robotaxi revenue also achieved an annual record high of 148 million, with a 210% growth year over year. This growth is powered by our asset line model. We provide the autonomous driving brain while mobility and fleet partners handle operations and vehicle ownership. This keeps vehicles off our balance sheet, enables efficient scaling, and aligns incentives to deliver a consistent user experience. Our Robotaxi revenue is also supported by a combination of ongoing service fee and recurring ride-hailing revenue share from platform partners. Our global expansion in Robotaxi operations has firmly established us as a leader in the rapidly evolving autonomous mobility landscape. In particular, our international business is becoming an increasingly important driver of group revenue. For full year 2025, overseas markets contributed approximately 29% of total revenue, spanning a diverse set of geographies, including the Middle East, Europe, and Asia Pacific. At the same time, our focus on operating efficiency has allowed us to sustain healthy margins even as we scale. In Q4 2025, group level gross profit increased 74% to 89 million with a group level gross margin of 28%. For the full year 2025, group level gross profit was 207 million, representing an increase of 87% with a group level gross margin of 30%. These results highlight the strengths of our business model and reinforce our confidence in our global expansion strategy. In Q4 2025, operating expenses increased slightly by 2% year over year to $655 million, with R&D representing 63% of the total. For full year 2025, operating expenses decreased by 11% to $2.04 billion, with R&D representing 67% of the total. The decrease in operating expenses was primarily driven by lower administrative expenses, partially offset by increases in R&D and selling expenses. As our primary investment area, the rise in R&D spending reflects our focus on long-term technological leadership, while disciplined cost management kept overall operating expenses under control. To break down further, R&D expenses increased by 29% to $411 million in Q4 2025 and increased by 26% to $1.37 billion For the full year 2025, primarily driven by our continued investments in top tier talent and the expansion of our next generation data center infrastructure, building a high performance backbone to support our L2 plus to L4 autonomous driving capabilities. This continuous R&D commitment is essential to maintaining our competitive edge and driving future growth. Administrative expenses decreased by 29% to $217 million in Q4 2025, and decreased by 48% to $596 million for the full year 2025. The decrease was mainly driven by lower share-based compensation and partially offset by growing professional service fees, personnel costs, and depreciation and amortization expenses. Selling expenses increased by 76% to $27 million in Q4 2025, and increased by 37% to $74 million for the full year 2025. These increases are in line with the growth of our business. Our net loss narrowed by 6% to $5,565 million in Q4 2025 and narrowed by 34% to $1.65 billion for the full year 2025. Building on our successful Hong Kong IPO in Q4 2025, we ended the year with a strong capital position. As of the 31st of December, 2025, we had total capital reserves of 7.13 billion, comprising 6.97 billion in cash and cash equivalents and time deposits, 144 million in investments in wealth management products, and 19 million in restricted cash. We maintained short-term bank loans of 324 million to support daily operations. With disciplined cash deployment, this level of capital provides a solid operating buffer and underscores our financial strength to support continued growth. On the 23rd of March, 2026, our board of directors authorized a share repurchase program under which we may repurchase up to U.S. dollar 100 million of our Class A ordinary shares, including in the form of American depository shares over the next 12 months. This authorization also reflects our commitment to shareholders and our confidence in the long-term value of WeRide. Looking ahead, we are moving forward with clarity and conviction. By end of 2026, we expect to have 2,600 robo-taxes globally, marking the first phase of our path toward tens of thousands of robo-taxes by 2030. As our fleet scales, we see a clear path to extending our proven deployment model to more cities worldwide. Supported by a strong balance sheet, relentless focus on operating efficiency, and deepening partnerships, we are well positioned to lead the next chapter for autonomous driving industry. With that, operator, we're now ready to take some questions.