RLX Technology Inc.

Hello, ladies and gentlemen. Thank you for standing by for RLX Technology Inc.'s second quarter 2026 earnings conference call. At this time, all participants are in a listen-only mode. After management's remarks, there will be a question and answer session. Today's conference call is being recorded and is expected to last for about 40 minutes. I will now turn the call over to your host, Mr. Sam Tsang. Head of Capital Markets for the company. Please go ahead, Sam.

Thank you very much. Hello, everyone, and welcome to RX Technology's second quarter 2026 Earnings Conference call. The company's financial and operational results were released through PR on its wire services earlier today and have been made available online. You can also view the earnings press release by visiting our IR websites at ir.relected.com. Participants on today's call will include our Chief Executive Officer, Ms. Kate Wang, our Chief Financial Officer, Mr. Chao Lu, and me, Sam Tsang, Head of Capital Markets. Before we continue, please note that today's discussions will contain forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Licitation Reform Act of 1995. These statements typically contain words such as may, will expect, anticipate, aim, estimate, intend, plan, believe, potential, continue, or other similar expressions. Forward-looking statements involve inherent risks and uncertainties. The accuracy of these statements may be impacted by a number of business risks and uncertainties that could cause actual results to differ materially from those projected or anticipated, many of which are factors that are beyond our control. The companies, its affiliates, advisors, and representatives do not undertake any obligation to update this forward-looking information, except as required under the equitable law. Please note that RX Technologies' earnings press release and this conference call include discussions of unaudited gap financial measures, as well as unaudited non-gap financial measures. RX's press release contains a reconciliation of the unaudited non-GAAP measures to the unaudited GAAP measures. For today's call, management will use English as the main language. We will also provide simultaneous interpretation on the Chinese line. Please note that the Chinese line is in listen-only mode, and Chinese interpretation is for convenience purposes only. In case of any discrepancy, management statements in the original language will prevail. I will now turn the call over to Ms. Kate Wang. Please go ahead.

Thank you, Sam, and thank you all for joining today's call. We delivered solid second quarter financial and operational results supported by our commitment to quality-driven, resilient, and compliant global growth. Our top line grew 14.8% year-over-year, in the second quarter, mainly driven by our expanding international footprint. Gross profit increased 47.8% year-over-year to 357.8 million RMB. As expected, revenue and gross profit moderated sequentially, not due to any softening in demand. by rather reflecting a trade inventory normalization following the first quarter's shipment, full forward driven by regulatory export adjustments. Because our distribution partners manage multi-brand portfolios, first quarter pre-stocking temporarily secured visibility into sell-out rates. leading to the shipment of the jasmine we saw this quarter. Underlying demand across our key international markets remains healthy and resilient. Against this backdrop, we focus on two strategic priorities, strengthening retail execution and optimizing our global operational infrastructure. These deliberate requirements are designed to lay the foundation for our next era of sustainable, profitable growth. Rather than chasing low margin volumes, we are directing our capital towards building an agile, compliant global platform that can absorb regulatory shifts and quickly adapt to evolving demands. Regulatory oversight across our international market is becoming more detailed and more restrict-enforced, from customers' enforcement priorities to refined frameworks. The United Kingdom is a case in point. Proposed regulations cover plain packaging, standardized device, authentic retail display bands. Restricted flavor descriptions and limits on dark store operations. As an industry leader, we welcome these regulatory shifts. It poses the operational agility required to address them proactively, engaging these stakeholders to foster high-standard, sustainable compliance frameworks. Over the long term, clear and consistently enforced boundaries push out non-compliant, low-quality competition and risk barrier to entry. For robust compliance infrastructure, R&D and the supply chain enables us to meet those standards early, enhancing our platform's operational predictability and long-term sustainability. Our hands-on operational experience across the international markets has taught us valuable lessons. In mature environments, traditional wholesaling models are no longer sufficient to sustain high-quality margin growth. As hardware technology and product standards stabilize, competition is shifting from pure product development to real-to-market execution. Direct Ratio, Proximity, and Channel Agility. As such, we are aggressively upgrading our distribution architecture through a targeted mix of direct channel investments, strategic distribution alliance, operational support, and channel innovation, and moving away from reliance on a single rigid distribution model In Asia, where our brand equity and consumer trust remains exceptionally strong, we are selectively broadening our footprint through localized commercial entities and proprietary channel models. In Europe, where barriers to entry are higher, we are expanding through capitalization strategic partnerships and equity investments. By combining our world-class supply chain with local distribution leaders, we empower existing trading ecosystems while securing direct sell-out visibility and dedicated retail shelf space, establishing a durable competitive mode. Europe is the cornerstone of our global growth strategy, where we are methodologically expanding our presence on the dual-engine model that balanced targeted MMA with organic growth across channels. In May 2025, we acquired a long-established European eVapor company with an integrated local retail and online footprint and have been supporting its expansion as a collaboratively partner, everything. Over the past year, this integration has brought us deep localized market insights and demonstrated the immense commercial value of aligning our global supply chain with trusted local operators. Building on that acquisition, in July 2026, who made a strategic controlling investment in a leading B2B and FMCG physical distribution leaders in Western Europe. This entity has a robust offline footprint, directly serving retail endpoints across the market. In B2B digital commerce, its proprietary ordering app connect with over 50% of independent retail points of sales in the country. Our integration philosophy centers on empowerment, not operational disruption. We do not intend to restructure their core operations or convert the platform into an exclusive outlet for our own products. they will remain an open multi-brand marketplace serving the broader retail ecosystem. By applying our global supply chain scale and portfolio brand relationships, we are confident that we can reduce these platforms' distribution costs and optimize sourcing terms. While expanding our distribution reach, we are also accelerating our transformation into a multi-category next-generation smoke-free product platform, extending beyond our leadership in eVapor into a broader smoke-free portfolio. We have commercialized our modern oral nicotine pouch line, and steadily wrapping up manufacturing capacity and the channel distribution. In the heat not burn category, we hold extensive proprietary technology and patent reserves as well as the pipeline of market ready products awaiting optimal market and regulatory conditions for commercial launch. To support these multi-category expansion and reduce our exposure to trade friction in the macroeconomic and geopolitical uncertainties, we are currently constructing a state-of-the-art manufacturing hub in Southeast Asia. The facility will cover multi-product categories. improve our terrorist positions and streamline logistics, supporting long-term sales resilience across our international markets. Our mandate is clear. Leverage our R&D capabilities, regulatory infrastructure, and newly strengthened mutual market networks to capture market share and establish leading position across the global Thank you. Thank you. Thank you. exclusively towards high-quality value of creative assets. By pairing direct channel control with multi-category product innovation, we are building a more resilient, diversified global platform structured to deliver sustainable long-term growth as the industry matures. Now I will hand the call over to Chao to review our financial results in detail.