Autohome Inc.

Ladies and gentlemen, thank you for standing by for Autohome's third quarter 2025 earnings conference call. At this time, all participants are in listen-only mode. A question and answer session will follow management preparation. As a reminder, this conference call is being recorded. If you have any objections, you may disconnect at this time. A live and archived webcast of this earnings conference call will also be available on Autohome's IR website. It is now my pleasure to introduce your host, Mr. Sterling Song, at Autohome's IR Director. Mr. Song, please go ahead.

Thank you, operator. Hello, everyone, and welcome to Autohome's third quarter 2025 earnings conference call. Earlier today, Autohome distributed its earnings release, which can be found on the company's IR website at ir.autohome.com.cn. Joining me on today's call is our Chief Financial Officer, Ms. Craig Yanzong, Management will go through the prepared remarks, which will be followed by a Q&A session, where it is available to answer all your questions. Before we continue, please know that the discussion today will contain forward-looking statements made under the safe harbor provisions of the U.S. Private Security Indications Reform Act of 1995. Overlooking statements are subject to risks and alternatives that may cause actual results to deform materially from our current expectations. Potential risks and incentives include, but are not limited to those outlined in our public filing with the U.S. Securities and Exchange Commission and the Hong Kong Stock Exchange. Auto Home doesn't undertake any application to update any forward-looking statements except as required under applicable law. Please also know that Auto Home's earnings press release and this conference call include discussions of certain unaudited non-GAAP financial measures. A reconciliation of the non-GAAP measures to the most directly compatible GAAP measure can be found in our earnings release. I'll now turn the call over to Autohome's Chief Financial Officer, Ms. Craig Yanzheng, for opening remarks. Please go ahead, Craig. Thank you, Songkai. Hello, everyone. I'm Craig Yanzheng. Thank you for attending our call today. Thank you, Sterling. Hello, everyone. This is Craig Yanzheng. Thank you for joining our earnings conference call today. In the third quarter, we will continue to promote the further deepening of the AI and O2O strategies. On the one hand, we will vigorously strengthen the integration of AI technology applications with products, drive business innovation, and enhance user experience and customer operation efficiency. On the other hand, we will continuously implement O2O platform construction, integrate online and offline resources, and optimize end-to-end experience. In the third quarter, we continue to advance our AI and O2O strategies. On AI, we significantly strengthened the integration of AI technologies with our products, fostering business innovation while enhancing both user experience and customer operational efficiency. On O2O, we continuously improved our O2O platform by integrating online and offline resources, optimizing the end-to-end user experience, and building a comprehensive, closed-loop ecosystem that spans the entire customer journey from initial traffic acquisition through transaction condition to up-sale services. In terms of AI technology applications, we have completed the full-scale upgrade of AI assistants by strengthening model capabilities In terms of AI technology applications, We completed a comprehensive upgrade of our AI assistance by strengthening model capabilities, integrating user inquiries with specific vehicle models, and expanding usage scenarios. We achieved precise matching between user queries and car models. This has created a decision-making loop of content drives engagement. Engagement leads to action. In addition, we've also introduced two new features. the AI Car Selection System, and the AI Vehicle Fort Diagnostics, providing users with more intuitive and efficient tools for their car-related needs. In September, we hosted the first global AI technology conference, not only built a high-level technology communication platform for core enterprises, but also demonstrated the advanced progress of Chinese car intelligent technology, which has contributed to the promotion of Chinese car brands. The successful inauguration of the conference also showed the professional influence of the car industry as a core media. We received the full endorsement of the five major car industry associations and the support of 14 relevant business partners. At the meeting site, the seven leading business leaders of the industrial chain gave a heavy speech. After the meeting, more than 30 car brands cooperated with the car industry, cooperated with more than 60 professional editors, technical experts, In September, we launched the first inaugural Global AI Technology Conference. This established a premium platform for technical exchange among leading enterprises, showcased cutting-edge advances in China's intelligent automotive technologies, and elevated the collective image for Chinese auto brands. The conference's success also served as a testament to AutoHome's professional influence as a trusted media platform. The conference received authoritative endorsements from five major automotive associations and was strongly supported by 14 key corporate partners. Seven top executives from leading companies in the industry delivered impact keynote speeches. Following the conference, over 30 automotive brands engaged with Autohome's official Weibo account, while more than 60 professional editors, technical experts, and PGC creators formed a multidimensional communication matrix that drew widespread attention across the industry. In terms of O2O's ecosystem construction, the launch of a pre-heating line at the new Zhijia shopping mall on September 20th marked an important breakthrough in the integrated one-stop strategy of Zhijia online and offline. In building our auto ecosystem, we self-launched our Autohome Mall on September 20, marking a major milestone and significant progress in our one-stop online to offline strategy. This initiative further improves our new retail business model through continuous upgrades and makes our model more complete. This strategy expands Auto Home's role from being a decision-making hub for car selection and research to the final car purchase and ordering for transactions, creating a fully digitalized closed loop for the entire car purchase experience, and significantly increasing the value of our traffic. Specifically, on content, we strengthened our content matrix by increasing professional depth and expanding the breadth of prospective while continuously advancing our diversified content ecosystem. In the report on domestic and foreign car shows in 2025, we combined the two lines to achieve a comprehensive coverage from global influence to local penetration. At Munich Car Show, we set up a global vision, from the core line of global first car and Chinese brand Chuhai, through high-intensity dual-language live broadcasts and video planning, to build a professional exclusive content organization. For our 2025 series of coverage, On domestic and international auto shows, we adopted a dual-track approach to achieve comprehensive reach from global influence to local penetration. At the Munich Auto Show, we took a global perspective, focusing on world premieres and the Chinese brand Goyang Global. We built a professional and exclusive content matrix through intensive bilingual live streaming and video production, then leveraged global mainstream media networks to amplify China's automotive innovation and brand recognition worldwide. At the Chengdu Auto Show, we focused on new car launches and the purchase guidance, integrating resources from 18 automakers to create auto home exclusive live streaming sessions. This provided users with an immersive auto show experience. On the first day of the auto show, we achieved 100% coverage of all new car launches. In addition to professional exhibition reports, we have also made key progress in the field of interactive ecology with content as the core of the layout. The newly established Zhijia Media Inc. is trying to build the core of the car category, with a wide range of content covering technology, tourism, and overseas. With professional and interesting PGC content, deep and comprehensive OGC information, the real UGC experience is the foundation, and a rich and diverse content system is formed. Beyond our professional auto show coverage, it made significant strides in developing a content-centered, interactive ecosystem The newly established Autohome Media MCN is committed to building a multi-category influencer matrix that centers on automotive vertical while expanding into technology, travel, and overseas content. They've also developed a rich and diverse content ecosystem that combines professional and engaging PGC content, in-depth and authoritative OGC insights, and authentic user-generated experiences that resonate. To date, we have gathered over 200 high-quality creators across multiple platforms, covering professional car reviews, technology, travel, and other areas, continuously enhancing Autohome's platform influence. According to Quest Mobile, the average mobile DAUs reached 76.56 million in September 2025, up by 5.1% from the same period last year. In the field of new energy, we focus on the needs of users and customers, and continue to build a war-like O2O vehicle ecosystem. Online, with the pre-heat of September, we are promoting the commercial city for the core of the car company to carry out trading services. Now, we plan to fully integrate the service system through the second-hand car store network and the online service system for the low-line city that can not be covered by the car company. to build a full chain of supply and service from online to offline. Based on the successful water test in September, we plan to officially launch the commercial city of Zhijia in Double Eleven. By integrating industrial upstream and downstream resources, we can provide users with a more accurate, professional and efficient purchase experience. In addition, Zhijia, which includes the total revenue of the new energy brand within the new retail, is also continuing to rise. The revenue has increased by 58.6% in the third quarter. In NEV, we continue to focus on user and client needs while building a comprehensive automotive ecosystem online centered around our newly soft-launched Auto Home More, introduced in late September, provides transaction services while our offline network of franchise stores, car tech outlets, and the used car dealerships is designated to integrate the entire process from online ordering to offline delivery and service. Building on the successful trial, we plan to officially launch the Auto Home More during the Double 11 Shopping Festival. By integrating resources from across the industry value chain, we are committed to providing users with more precise, professional, and efficient car-purchasing experiences. Furthermore, total revenues from NEVs in the third quarter, including those from the new retail business, have continued to grow increasing by 58.6% from last year. In terms of digitalization, our five digital product lines rely on Zhijia's full-term data tracking capability to continue to assist customers in improving head-on accuracy and service efficiency. In addition, at the Global AI Technology Conference, we heavily released Zhijia's Tianshu Smart Service Platform. The platform uses Zhijia's self-proclaimed Cangjie model as the technical base, and uses open tools On digitalization, our five major digital intelligence product lines are leveraging AutoHome's platform capabilities of full lifecycle data tracking, to continuously help clients improve targeting accuracy and service efficiency. Furthermore, at the Global AI Technology Conference, we officially launched the Qianshu Intelligence Service Platform. Powered by Autohome's proprietary Tangjie large language model, the platform uses an open toolkit and service distribution capabilities to redefine collaboration among users, the platform, and the ecosystem partners. This advancement drives Autohome's transformation from an automotive information platform to an industry-wide intelligent hub, further strengthening our few advantages in technology and ecosystem. As a second-hand car business, we continue to promote the standardization process of trading and service, and rely on AI inspection experts built on historical trading data and algorithmic models to achieve the leading level in the industry in terms of valuation accuracy. At the same time, We continue to advance the standardization of both transactions and services. The AI Car Inspection Expert developed based on historical transaction data and algorithmic models have achieved industry-leading accuracy in vehicle valuation. Meanwhile, our flagship certified used car stores have further expanded its network of partner dealers. In the future, we'll continue to uphold integrity and standardization as our foundation, deepen our collaboration with high-quality used car dealers, and continuously to provide consumers with a more reliable and worry-free used car buying experience. 总体而言,今年我们以AI和O2O为核心驱动, 全面加速业务布局。 未来,我们将通过持续推动产品与业务模式的双重创新, 着重致力于构建更高效的汽车生态服务体系, 为行业持续创造价值, 并助力公司实现长远稳健发展。 In summary, this year we focused on AI and O2O to comprehensively accelerate our business expansion. Looking ahead, we will continue driving innovation in both products and business models, building a more efficient automotive ecosystem and a service system that creates sustained value for the industry and ensures our long-term stable development. 我来向大家简述一下汽车之家2025年第三季度的主要财务情况。 请注意,我将在今天的讨论中仅以人民币作为货币单位,除非另有说明。 With that, now please let me briefly walk you through the key financials for the third quarter 2025. Please know that I will reference RMB only in my discussion today, unless otherwise stated. 第三季度收入总额为17.8亿元。 Net revenues for the third quarter reached 1.78 billion. To break it down further, media services revenues contributed 298 million. Least generation services revenues were 664 million. and the online marketplace and others revenues increased by 32.1% year over year to 816 million. With respect to cost, cost of revenues in the third quarter was 646 million, compared to 408 million in the third quarter of 2024. Growth margin in the third quarter was 63.7% compared to 77% during the same period last year. turning to operating expenses still the marketing expenses in the third quarter was 620 million compared to 877 million in the third quarter of 2024. Product and development expenses were $279 million compared to $339 million in the third quarter of 2024. General and administrative expenses were $125 million compared to $137 million during the same period last year. Overall, the company's third quarter sales revenue was $1.47 billion, which was $0.83 billion in the same period last year. Overall, we delivered an operating profit of 147 million in the third quarter, compared to 83 million for the same period of 2024. Adjusted net income attributable to other homes was 407 million in the third quarter, compared to 497 million in the corresponding period of 2024. Nangat's basic and diluted earnings per share in the third quarter was 0.87 and 0.86 respectively. compared to 1.02 for both in the corresponding period of 2024. Non-GAAP basic and diluted earnings per ADS in the third quarter were 3.47 and 3.45, respectively, compared to 4.09 and 4.08, respectively, in the corresponding period of 2024. As of September 30, 2025, our asset balance sheet continues to show strong performance. As of September 30th, 2025, our balance sheet remained low but with cash, cash equivalent and the short-term investment of 21.89 billion, we generated net operating cash flow of 67 million in the third quarter. On September 4th, 2024, our board of directors authorized a new share repurchase program under which we are permitted to repurchase up to U.S. dollar 200 million of auto homes ADS for a period not to exceed 12 months thereafter. On August 14, 2025, the board approved an extension of the term of this program through December 31, 2025. As of October 31, 2025, we have repurchased approximately 48 million EDS for a total cost of approximately US$146 million. In addition, according to the company's stock policy, the Board of Directors has approved the issuance of $1.02 U.S. stocks, or $0.3 U.S. stocks, or U.S. stocks, or U.S. stocks, or U.S. stocks, or U.S. stocks, or U.S. stocks, In addition, in accordance with our dividend policy, our board of directors has approved a cash dividend of US dollar 1.2 per ADS or US dollar 0.30 ordinary shares payable in US dollars to holders of ADS and ordinary shares of record as of the close of business on December 31st, 2025. The aggregate amount of the dividend will be approximately RMB 1 billion and expected to be paid to holders of ordinary shares and ADS of the company around February 12th, 2026. and February 19th, 2026 respectively. On September 30th, 2025, the company announced the approval of a cash dividend of approximately RMB 500 million. Overall, the company has fulfilled its commitment to shareholders to distribute no less than RMB 1.5 billion in dividends for the full year of 2025. Looking ahead, we remain committed to maintaining a long-term, stable, and proactive approach to shareholder returns, and we sincerely thank our shareholders for their continued strong support to the company. So that concludes our financial summary. We are ready to open up CMA session. Operator.

Thank you. We will now begin the question and answer session. To ask the questions on the phone, please press star 11 and wait for a name to be announced. If you'd like to cancel your request, you can press star 11 again. Our first question comes from the line of Thomas Chong of Jefferies. Please go ahead.