Autohome Inc.

Ladies and gentlemen, thank you for standing by for Autohome's first quarter 2026 earnings conference call. At this time, all participants are in listen-only mode. A question and answer session will follow management's prepared remarks. As a reminder, this conference call is being recorded. If you have any objections, please disconnect at this time. A live and archived webcast of today's call will be available on Autohome's IR website. It is now my pleasure to introduce your host, Sterling Song, Auto Home's IR Director. Mr. Song, please go ahead.

Thank you, operator. Hello, everyone, and welcome to Auto Home's fourth quarter 2026 Earnings Conference Call. Earlier today, Auto Home distributed its earnings release, which can be found on the company's IR website at ir.autohome.com.ca. Joining me on today's call is our Chief Financial Officer, Ms. Cui Yanzong. Management will go through the prepared remarks first, which will be followed by a Q&A session, where they will be available to answer your questions. Before we begin, please note that today's discussion contains forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Dedication Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from our current expectations. Potential risks and uncertainties include but are not limited to those outlined in our public filings with the U.S. Securities and Exchange Commission and the Hong Kong Stock Exchange. Autohome undertakes no obligation to update any forward-looking statements except as required under applicable laws. Please also know that Autohome's earnings press release and today's conference call include discussions of certain unaudited land-gap financial measures. A reconciliation of the land-gap measures to the most directly comparable gap measures can be found in our earnings release. I will now turn the call over to Autohome's Chief Financial Officer, Ms. Craig Yanzheng, for opening remarks. Craig, please go ahead. Thank you, Zhongkan. Hello, everyone. Thank you, Sterling. Hello, everyone. This is Craig Sun. Thank you for joining our earnings conference call today. more accurately meet the consumer's needs. At the same time, through deep-rooted, high-quality content and the expansion of new media, our user size is steadily expanding. The number of Japanese users on the mobile end has exceeded 80 million, creating a new record. On the construction of the trading platform, our new retail business has launched the online shopping function, and cooperated with many retailers to explore the new experience of car e-commerce. In addition, we are also actively promoting overseas deployment. Our overseas platform, YES Auto, has officially entered into operation in Thailand. The second-hand car cross-border export international platform is also on the line. This series of progress marks a new stage of development in the domestic and international double-circuit parallel. We began the year by rolling out a series of initiatives to accelerate the transformation of our platform. from an automotive information media into a comprehensive automotive service ecosystem. On the user's front, we've initiated a major brand refresh and an APP upgrade, shifting our focus towards users' interests and the end-to-end car purchase journey to more precisely address consumers' demands. By strengthening the development of premium content and expanding our new media matrix, we continue to grow our user base steadily. with average mobile daily active users surpassing 80 million, a new all-time high. With regards to our transaction platform development, our new retail business launched an online car purchase feature and began piloting collaborative initiatives with multiple dealers to explore new automotive e-commerce experiences. We also continued to advance our global expansion ES-Auto, our overseas platform, also want to live together. Officially launched operation in Thailand and our global cross-border used car export platform also want to live together. These advancements mark the beginning of a new development phase for auto home, characterized by a new circulation model spanning both domestic and international market. With the ongoing expansion of the front desk business, The basic capabilities of the home platform are also being improved at the same time. AI and big models are becoming key points in the infrastructure. At the external service level, we provide AI intelligent products to our partners. At the internal operation level, we have integrated the big model capabilities into the company's various work processes. AI-driven platform operation is rapidly changing from an isolated efficiency improvement to a full chain system. As our front-end business continues to expand, we are strengthening our core platform capabilities in parallel. AI and large language models are increasingly becoming a foundational pillar of our infrastructure. On the external services front, we provide our partners with an AI-powered intelligent product mix. On the internal operations front, we've already integrated large language model capabilities into the company's workflows. As a result, AI-driven platform operations are rapidly advancing from isolated efficiency gains to end-to-end systematic transformation. In March this year, our overseas content platform ES-Auto officially launched in Thailand, expanding our professional advantage to the international market. The platform focused on localization, introduced local creators and established a professional content system. Currently, the platform has covered 100 Chinese new energy vehicles, and has included more than 10,000 product configuration information. This is a solid foundation for the establishment of Chinese new energy vehicles in the Thai vehicle warehouse. In addition, thanks to the opportunity of the Thai International Motor Show, we have joined together six Chinese car brands and 12 media to carry out a three-dimensional broadcast of the exhibition content to build a diversified topic. This event has reached 140 million views on the whole network, More than 530,000 times. For the first time in the sea, it is a strong start. Also for the future of business, long-term diversification development opens up a new room for improvement. Specifically, in March of this year, our overseas content platform is OTO, officially launched operations in Thailand, extending our professional strength into international markets. It has focused on localized operations. The platform has on board local creators and established a professional content system to date it covers 100 chinese new energy vehicle model series and includes more than 10 000 product specifications laying the groundwork for a china nev database in thailand In addition, leveraging the momentum of the Bangkok International Motor Show, we partnered with six Chinese automotive brands and 12 media outlets to execute integrated communications campaigns and build a diverse topic matrix. This campaign generated over 140 million views and over 530,000 user interactions across platforms. giving us a strong start in our first overseas market and creating new opportunities to support the long-term diversified development of our business. In terms of the MCN construction, in the first quarter, Zhijia Media's MCN, Daren Ecology, achieved a significant growth in quantity, and over-the-top high-quality creators broke through 650. The number of new media outlets has accumulated up to 150 million users, and the proportion of heads and backs of Daren has increased significantly. to further enhance the overall health of the ecosystem. Through holiday-themed marketing, creative motivation support, offline exhibition promotion, performance hand-in-hand, and overseas guests, and ecological construction, we are fully constructing the content competitiveness of the difference. Quasimodo data shows that the number of mobile users reached 80730,000 in March, which is a 4.9% increase. In terms of Amsterdam development in the first quarter, also for media and then ecosystem improved in both quantity and quality. The number of premium creators across various fields exceeded 650 and the cumulative reach across new media platforms approached 150 million users. The share of top tier and the middle tier influencers increased significantly. and further enhancing the overall health of the ecosystem through various approaches, including holiday-themed marketing campaigns, creator incentives, deep engagement at offline sessions, professional driver incubation, and the development of an overseas influencer ecosystem, etc., we are comprehensively building our differentiated content competitively. According to Quest Mobile, Autohome's average mobile DAUs reached 80.73 million in March, representing a year-over-year increase of 4.9%. In the field of new energy vehicles, we continue to focus on the commercial city of the car industry and strive to build a new trading ecosystem for the car industry. In the fall of April, we launched the online hookup function in Shenzhen and Xi'an, two cities. Local cooperating retailers released competitive off-road vehicles on the commercial city platform. Users can complete the online selection of vehicles in one stop, pay a large deposit, sign an online contract, and raise money to buy a car. In a new energy vehicle sector, We continue to focus on Auto Home more as we build a new transaction ecosystem for the automotive industry. In late April, we launched the online car purchase feature in two cities, Shenzhen and Xi'an. Local partners, dealerships posted competitive local pricing on the mall, enabling users to complete the entire car purchasing process in one go, including online vehicle selection, configuration, and deposit payments Users can then sign the contract offline and pay the remaining balance before taking delivery. To streamline the car purchasing process and address user concerns, we introduced four key guarantees, that is, officially certified vehicle sources, end-to-end supervision funds, transparent pricing, and a worry-free refundable deposit policy, from sourcing compliance to fund security. and from transparent pricing to flexible purchasing options, the platform prioritizes user rights at every stage, delivering a secure and trustworthy car purchasing experience. In terms of AI and big models, we are using AI big models to repeat the entire process of tracking from the platform information center to the content distribution. Through AI smart radar, we continuously monitor online hotspots Combined with large-scale model-based content packaging and AIGC-enabled automation content, we effectively combine professional car topics and wider public attention points to create a set of efficient and fast response mechanisms. At the same time as we improve the relevant content, the performance of operations has also been significantly improved. In addition, we will also apply the reverse model and the intelligent distribution model to the membership business, The anti-revealing model uses the results of the transaction to reverse the source, and proposes accurate user images that match the transaction height, and trains the core characteristics of these users, thereby improving the compatibility between platform content and accurate user needs. The smart distribution model breaks down the limitations of single platform data, and integrates multi-dimensional information such as user behavior, scene number, and transaction source, to achieve a more intelligent and accurate traffic match. In the area of AI and a large language model, we are leveraging AI and a large language model to reshape the entire workflow of our platform's content center, from tracking trending hot topics across the internet to content distribution. Through an AI-powered smart radar, we continuously monitor online trends around the clock. Combined with larger language model-assisted content packaging and AIGC-enabled automated content generation, we've effectively integrated professional automotive topics with broader public hot topics, establishing a highly efficient rapid response mechanism. As a result, we have improved content relevance while significantly enhancing operational efficiency. In addition, we have applied both the reverse funnel model and intelligent distribution model to our membership business. The reverse funnel model works by reasoning backwards from transactions to derive accurate user profiles and extract the key characteristics of these users, improving alignment between platform content and the high conversion user needs. The intelligent distribution model breaks through the limitations of isolated platform data by integrating multidimensional inputs. such as omni-channel user behavior, scenario preferences, and transaction attribution data. This enables smarter, more precise traffic matching, as well as more effective user targeting and reach. In the first quarter of the second-hand car business, we listed two core business platforms in the first quarter, the all-terrain sales service platform and the second-hand cross-border export service platform. form the dual-wheel drive pattern of domestic service system improvement and global market expansion layout, provide a comprehensive solution for individual car owners, domestic car dealers and overseas buyers, and assist the industry to enter a new phase of high-quality, transparent and safe high-quality development. Among them, the full-route sales service platform provides official free testing, exclusive steward service and nationwide pricing functions, through the deep integration of the bottom-level digitalization system to establish a standardized service system that covers the entire life cycle of the owner and seller. Currently, the platform has been tested and operated in two cities. We plan to accelerate this model to promote it to more cities across the country. The second-hand car cross-border export service platform is our initial attempt to grasp the opportunity for overseas market growth. The platform supports merchants to ship their vehicles to domestic and international double platforms at the same time. Each export vehicle is equipped with a detailed inspection report and a complete security record to standardize service, eliminate overseas buyers' concerns, and reduce the trust cost in cross-border transactions. In the future, we will introduce more vehicle cooperation partners to further enrich the supply of vehicles that meet the export conditions. We are committed to building a In the used car business, during the first quarter, we launched two core business platforms, a full-process used car selling service platform and a cross-border used car export service platform. Together, they form a dual-engine model of improving quality and efficiency in domestic services while expanding into global markets. These platforms provide individual car owners, domestic dealers, and overseas buyers with one-stop integrated solutions, helping the industry move into a new stage of high-quality development defined by efficiency, transparency, and security. Our full process uses USECAR's selling service platform offers three official inspections, dedicated goonset services, and nationwide price inquiry capabilities. Through deep integration of our underlying digital systems, we've established a standardized service system that covers the entire lifecycle of a car owner's selling journey. The platform is currently in pilot operation in two cities, and we plan to accelerate the rollout to more cities nationwide. Our cross-border use card export service platform represents our initial effort towards capturing growth opportunities in overseas markets. It enables dealers to list vehicles on both domestic and international platforms with a single click. Each exported vehicle includes a detailed inspection report and a complete maintenance and insurance record. These standardized services help address overseas buyers' concerns and reduce the trust gap associated with cross-border transactions. Going forward, we will introduce more vehicle sourcing partners to further enrich the supply of export-qualified vehicles. We also plan to build an end-to-end closed-loop system that integrates domestic vehicle sourcing and aggregation, cross-border transaction matching, and overseas delivery fulfillment, enabling used car dealers to execute compliant cross-border exports with no barrier. As a whole, since the beginning of 2026, we have actively promoted new attempts and layout in the field of content, ecology, new retail, and second-hand cars. While promoting business development, we have always maintained a healthy asset representation and continued to fulfill the commitment to provide stable returns to shareholders. Today, the Zhijia Board of Directors has approved the cash split plan for the first half of 2026. At the same time, we are also actively implementing stock repurchase plans in the public market. Looking forward to the future, we will continue to focus on new growth areas and create long-term value for shareholders while controlling costs. Overall, since the beginning of 2026, we have been actively advancing new initiatives and strategic deployments across multiple business areas, including our content ecosystem, new retail, and used car businesses. While driving business development, we've maintained a healthy balance sheet and continue to deliver on our commitment to providing stable shareholder returns. Today, our board of directors approved a cash dividend plan for the first half of 2026, and we have been actively executing share repurchases in the open market. Looking ahead, we will remain focused on emerging growth areas while maintaining stringent cost controls to ensure long-term value for our shareholders. Next, I will explain to you the main financial situation of the first quarter of the car family in 2026. Please note that I will only use RMB as a currency unit in today's discussion, unless there is another explanation. With that, let me briefly walk you through the key financials for the first quarter of 2026. Please note that I will reference R&D only in my discussion today, unless otherwise stated. Next, revenues for the first quarter were $1.05 billion. To break it down further, media services revenues were 163 million, lead generation services revenues were 503 million, and online marketplace and others revenues were 382 million. This is back to cost. Cost of revenue in the first quarter was $257 million compared with $316 million in the first quarter of 2025. Gross margin in the first quarter was 75.5% compared with 78.3% in the same period last year. In terms of operating expenses, the first quarter sales and market expenses were $5.06 billion, and the same period was $5.44 billion. The development cost is 2.74 billion yuan, which is equivalent to the same period as the youth. The general management cost is 1.2 billion yuan, and the same period as the youth is 1.31 billion yuan. Turning to operating expenses, sales and marketing expenses in the first quarter were 506 million compared with 544 million in the first quarter of 2025. Product and development expenses were 274 million, flat year over year general and administrative expenses were 120 million compared with 131 million in the same period last year.

Ladies and gentlemen, please remain on the line.