Full Truck Alliance Co. Ltd.

Ladies and gentlemen, good day and welcome to Full Truck Alliance's first quarter 2026 earnings conference call. Today's conference is being recorded. At this time, I would like to turn the conference over to Maomao, Head of Investor Relations. Please go ahead.

Thank you, Operator. Please note that today's discussion will contain forward-looking statements relating to the company's future performance, which are intended to qualify for the safe harbor from allowability. as established by the U.S. Private Securities Litigation Reform Act. Such statements are not guarantees of future performance and are subject to certain risks and uncertainties, assumptions, and other factors. Some of these risks are beyond the company's control and could cause actual results to differ materially from those mentioned in today's press release and discussion. A general discussion of the risk factors that could affect FTA's business and financial results is included in certain filings of the company with the SEC. The company does not undertake any obligation to update this forward-looking information, except as required by law. During today's call, management will also discuss certain non-GAAP financial measures for comparison purposes only. For a definition of non-GAAP financial measures and a reconciliation of GAAP to non-GAAP financial results, please see the earnings release issued earlier today. Joining us today on the call from FTA's senior management side are Mr. Hui Zhang, our founder, chairman, and CEO, and Mr. Fanmentai, our chief financing and investment officer. We will open the call to questions following a brief opening remarks from Mr. Zhang. As a reminder, this conference is being recorded. In addition, a webcast replay of this call will be available on FTA's investor relations website at ir.futureofalliance.com. I will now turn the call over to our founder, chairman and CEO, Mr. Zhang. Please go ahead, sir.

大家好,欢迎各位参加满邦2026年第一季电话会。 今年一季度在复杂多变的市场环境中,我们坚持高质量的发展和素质化创新,各项业务都稳步增长。

Hello, everyone. Thank you for joining us today for our first quarter 2026 earnings conference call. In the first quarter of 2026, amid a complex and rapidly evolving market environment, we remained committed to high-quality growth and digital innovation, driving steady business growth across the board.

介入方面,量治其身。 首先,生态进化策略成效显著。 实际性培分过足。 New points make the behavior of double-decker users more standardized. The transportation fee protection mechanism helps to actively solve the problem of transportation fee disputes in a wide range of times. User experience and age continue to improve. Experience improves the promotion of order growth. This quarter, the number of orders reached 55,040,000 orders, which is more than 14% of the total growth. We have completed the product policy and product newness in the group. The group's offline logistics demand continues to decline. The average number of live orders reached 3.1 million people, which increased by 13% in total. The same rate of increase in the number of live orders increased by 44% in total, which increased by 5% in total. In terms of innovation, the AI assistant of the delivery service began to integrate deeply with the delivery service, which helped the delivery service to reduce the cost. No-man's-car started to run out of power, and the efficiency continued to rise. The list of dedicated businesses quickly covered the whole country. QMOOV has been successfully launched in four countries overseas. We strive to provide users with up-to-date transport products to expand the long-term development space of group business in the future.

Operationally, we delivered meaningful improvements in both scale and quality. First of all, our ecosystem governance initiatives yielded notable results. Our credit rating programs for truckers and shippers have raised conduct standards for on both sides of the platform. while our freight payment protection mechanism has substantially reduced payment dispute issues for truckers, driving higher user satisfaction and retention. Our enhanced user experience also fueled order growth. Fulfilled orders reached $50.0 billion this quarter, up over 14% year-over-year. On the shipper side, we continued to enrich our product portfolio and deepen user mindshare, bringing more offline logistics demands onto our online platform. Average shipper MAUs reached 3.11 million this quarter, up 13% year-over-year. On the trucker side, both truckers' activity and fulfillment frequency increased steadily, with overall fulfillment rate exceeding 44%, up 5 percentage points year-over-year. On the innovation front, Our AI shipper assistant is now deeply integrated into key workflows, including shipment posting, freight matching, and shipment tracking, helping shippers reduce costs and operate more efficiently. We also launched pilot programs for autonomous delivery vehicles with unit economics improving. In addition, our less than truckload products have rapidly expanded to nationwide coverage via the transport capacity of dedicated line carriers, while Q-Move continued to gain traction across four international markets. Taken together, these initiatives reflected our commitment to provide users with one-stop end-to-end transportation solutions, unlocking new long-term growth opportunities.

财务方面,整体经营实现高质量的稳健增长, The revenue structure continues to improve. This quarter, the total revenue of the company increased by 5.5% to 28.5 billion yuan. In addition to the full balance, the revenue reached 20.2 billion yuan, which increased by 17%. Among them, the transaction service revenue reached 13.9 billion yuan, which increased by more than 33%. The business activity advance flow increased by 15.6 billion yuan, which increased significantly. Businesses continue to be resilient and continue to improve, providing solid foundations for the development of new technologies and new businesses in the future. Looking forward to the future, the whole family will rely on perfect product quality, healthy ecology, and continuous expansion of the network efficiency of double users, and the use of sea-level user behavior and transaction data. Increase the application value and logistics industry efficiency of AI in the logistics chain, and provide long-term reporting for users and shareholders.

Financially, we achieved high-quality solid growth while continuing to optimize our revenue mix. In the first quarter, total net revenues grew by 5.5% year-over-year to RMB 2.85 billion. Including free brokerage services, net revenues reached RMB 2.02 billion, up 17% year-over-year. Notably, transaction service revenues reached RMB 1.39 billion, up more than 33% year-over-year. Net cash provided by operating activities increased significantly year-over-year to RMB 1.56 billion, reinforcing our operational resilience and building a strong foundation for future innovation and growth. Looking ahead, we will leverage our comprehensive product portfolio, healthy platform ecosystem, and growing network effects on both sides of the platform, coupled with our vast repository of user behavior and transaction data to deepen AI application across the full logistics value chain, driving industry-wide efficiency gains and creating long-term value for both our users and shareholders. Thank you all once again. That concludes our opening remarks. We would now like to open the call to Q&A. Operator, please.

Thank you. If you wish to ask a question, please press star 1 on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star 2. If you're on a speakerphone, pick up the handset to ask your question. For the benefit of all participants on today's call, if you wish to ask your question to management in Chinese, please immediately repeat your question in English. Your first question comes from Ronald Keung with Goldman Sachs. Please go ahead.

Thank you for taking my question. I want to ask about the fulfilled order this quarter that grew 14%. in the first quarter. So quite a notable acceleration compared to last quarter. So what are the key drivers behind this and how do you view the look in the coming few quarters? Thank you.

Thank you, Ronald. This is Simon Tsai from Food Truck Alliance. So first quarter for food order growth accelerated to 14.3%. That's ahead of our expectations. and that's primarily driven by three key factors. First, the impact of our platform governance initiatives continue to ease, and the associated benefits began to come through. In the fourth quarter of last year, we intensified the governance efforts targeting misclassified carpooling orders, freight reselling, and real name verification. which temporarily waited on other growth during that period, as we communicated before. As we entered the first quarter, these measures transitioned into business as usual operations, and their drag on other growth is tapering off. More importantly, the structural improvements they have delivered across authenticity of freight demand, pricing discipline, and fulfillment reliability are increasingly translating into tangible business momentum and re-accelerating order growth across our platform. This is the primary factor behind the acceleration in order growth in the first quarter. And secondly, recent oil price volatility has highlighted our platform's advantage in transparent, efficient, and price discovery. As fuel prices climbed sharply from March onward, and drove greater freight cost volatility. Offline freight brokers and relationship-based trucking network struggle to pass through these cost increase to shippers in a timely and transparent manner. By contrast, our platform enables real-time supply and demand-driven price discovery given our large, verified trucker base, delivering more transparent and competitive pricing in highly dynamic market conditions. This superior pricing mechanism accelerated shipper migration from offline channels onto our platform and feeling a sharp rebound in shipping demand in the latter part of the first quarter. And thirdly, enhanced operational efficiency drove a systemic improvement in fulfillment frequency across our user base. Throughout the first quarter, we continued investing in key product lines and operational initiatives Notable examples include multiple iterations of our new freight zone feature, the extension of freight payment protection to our entire trucker base, including non-members, and deeper integration of our instant cargo function with our trucker credit rating program. Together, these efforts strengthened our service capabilities across the full value chain and spanning freight posting, matching, and fulfillment protection. The data makes this clear. Every shipper segment, including both broker and direct shippers, delivered double-digit year-over-year growth in fulfilled orders in the first quarter, reflecting steady gains in user stickiness and repeat order frequency within an increasingly healthy platform ecosystem. Looking ahead, we remain confident in sustaining solid growth in the coming quarters, supported by the continued benefits of our platform governance initiatives, a growing share of orders from direct shippers, and deeper AI penetration across matching and fulfillment. We're well-positioned to deliver high-quality, sustainable growth throughout the years.

Thank you.

Thank you. Your next question comes from anyone with Morgan Stanley. Please go ahead.

Hello, Chairman Zhang Hui, Chairman Simon, Chairman Mao, Emma. Thank you for accepting my question. My question is about the oil price, because we saw that in March, due to the influence of geopolitical influence, the oil price fluctuated very sharply, which brought a certain amount of pressure on private transport costs. So we have seen the rise in oil prices on the platform. What is the impact? And if there is, what are our main response measures? I will translate it myself. From March onward, geopolitical driven oil price volatility has pressured truckers' transportation costs. Has the company observed any impact on the platform and what are the key measures taking response? Thank you.

Thank you, Eddie. Regarding the impact of transportation costs volatility on our platform, we believe that in the near future, the pass-through of higher fuel costs to freight rates may prompt some shippers of low-value goods to reduce or defer shipments, which could lead to some softening in long-haul freight demand. Over the longer term, however, with the online penetration of road freight still extremely low, the structural opportunity to help shippers reduce logistics costs and wing shares from offline channels far outweighed the near-term headwind from oil price-driven demand pressure. In response to the oil price surge in March, we took several steps to protect trucker economics and prevent additional cost burden on truckers. For example, we implemented a freight rate fuel price linkage mechanism to keep freight rates aligned with rising fuel costs, including raising both the reference freight rate and bidding floor prices. In parallel, we launched a broad shipper outreach campaign on our apps to raise awareness of the fuel price environment and promote fair bidding practices. Additionally, we continue to leverage our fueling business to help truckers manage fuel costs. Over the past few years, we have steadily expanded our fueling network to approximately 12,000 gas stations. Building on this foundation, we achieved a significant milestone in our core energy network strategy. In late April, we formally entered into a strategic cooperation agreement with Sinopac, and this partnership has already gone live across Jiangsu, Zhejiang, and Anhui provinces, with over 3,000 Sinopac stations now accessible on our platform. We expect to meaningfully expand this network through the remainder of this year. Our fueling business operates under an asset-light facilitation model. Leveraging on a platform, we are able to secure preferential fuel rates below prevailing benchmark prices from gas stations, partners, and pass these through to verified truckers as exclusive discounts, net of a modest service fee. We also complement this offering with flexible subsidy programs calibrated to market conditions to help truckers reduce costs further. For truckers, our model meaningfully lower per trip fuel expenses and provides tangible cash flow relief during a period of surging oil prices. In this way, it not only serves as a practical economic buffer for the truckers, but also solidifies the active trucker supply and fulfillment capacity across our platform. For FTA, our matching capabilities extend naturally beyond freight transactions into post-freight service scenarios, such as fueling, and broadening our service ecosystem while deepening trucker engagement and stickiness throughout the entire transportation journey. Looking ahead, we will continue to broaden and deep our fueling network and expand strategic partnerships with key partners, such as Sanopac, in an elevated diesel price environment. The value proposition of our fueling business becomes increasingly compelling for truckers, and we're also confident that we can turn external fuel price volatility into an opportunity to grow our value-added services, enabling truckers on our platform to secure freight efficiently while meaningfully lowering their overall operating costs.

Thank you.

Thank you. Your next question, it comes from Ryan Gong with Citi. Please go ahead.

Thank you, Ms. Zhang Hui, Ms. Simon, Ms. Mao, Ms. Emma. Good evening. Thank you for accepting my question. First of all, congratulations on your very good performance. And then I would like to ask about the trend of the one-week interest rate and how we should look at this indicator in the future. I will translate it very quickly. My question is about fulfillment rate. How did the fulfillment rate change during the first quarter, and how does management expect this metric to evolve going forward? Thank you.

Thank you, Brian. In the first quarter, the overall fulfillment rate was 44.1%, and it's up 4.9 percentage points year over year, and 1.4 percentage points quarter over quarter. it also set another new record. Notably, the average fulfillment rate for low and medium frequency direct shippers remain at a strong level of nearly 65%. The improvement in fulfillment rates reflects the combined effects of multiple initiatives driven primarily by three key factors, optimized order mix, enhanced operational measures, and ecosystem governance. First of all, the continued optimization in order mix is the primary driver. In the first quarter, fulfilled orders from direct shippers accounted for a growing share of total fulfilled orders. Direct shippers typically hold higher standards for fulfillment reliability and demonstrate strong execution commitment, making their growing share a direct contributor to the improvement in the platform's overall fulfillment performance. Second, and more encouragingly, fulfillment rates among professional shippers, the 1688 members, also improved year over year and quarter over quarter in first quarter 2026. This 1688 cohort has historically lagged behind direct troopers in terms of fulfillment rate, so the progress here is particularly meaningful. The improvement in the first quarter was driven by three factors. First, ongoing benefits from platform governance. As mentioned earlier, we cleaned up a number of platform integrity issues that is related to the users, including misclassified carpooling orders, cargo reselling, and suspiciously low-priced freight listing. This has materially strengthened overall fulfillment reliability on the platform. Second, structural improvement in the 1688 shipper base. As real name verification shippers start waiting and abnormal other behavior surveillance become part of our regular operations, lower quality shipper users naturally started to leave the platform. The shippers who have stayed are showing more genuine shipping demand and stronger fulfillment intent. And thirdly, we made a series of targeted product and operational improvements. This includes a rebuilt shipping workflow within the shipper and mini program, and a secondary confirmation step for new freight listings. Paired with upgrades to our matching algorithm, These upgrades drove structural improvements in machine efficiency and fulfillment conversion for professional shippers across standard shipping scenarios. We continue to step up investment in key operational initiatives. In the first quarter, upgrades to truck-facing mechanisms such as expanding freight protection coverage and deepening integration of instant cargo and trucker credit rating strengthen truckers' willingness to accept orders and bolster fulfillment reliability, and that translates to a meaningful uplift in our platform-wide fulfillment rate. Looking ahead, with continued refinement of our credit rating system, further expansion of our direct shipper base, and ongoing phase-out of low-quality freight listings and deeper AI applications across both matching and fulfillment, We expect fulfillment rates to continue on a steady upward trajectory. Thank you.

Thank you. Your next question comes from Thomas Chong with Jefferies. Please go ahead.

晚上好,謝謝管理層介紹我的提問。 一季度我們看到花火波主熱火311萬元, 同比增長12.7,主要驅動的因素是什麼? Let me translate myself. In the first quarter, effort to shipper MAU reached 3.11 million, representing a year-over-year increase of 12.7%. What were the primary drivers behind this growth? Thank you.

Thank you, Thomas. Shipper MAUs continue to deliver double-digit growth. In the first quarter, mainly driven by three factors, sustained gains in customer acquisition efficiency, expanding product benefits, and strengthened user trust. First, multi-channel user acquisition strategy continued to fuel our MAU expansion with overall acquisition efficiency elevating steadily. In terms of channel mix, app stores, information feed ads, and cross-band partnerships remain the primary contributors. Specifically, the App Store channel continued to deliver strong acquisition efficiency thanks to our ongoing optimization across campaign management, keyword strategy, and the download page and conversion funnel. This also reflects the growing brand awareness and conversion power of the FTA brand among our target shipper base. Information feed and FCM brand channels also delivered robust year-over-year growth in the first quarter, with targeted reach ROI trending higher. Meanwhile, cross-brand partnership channels sustained solid growth, reflecting the initial success of our ecosystem collaboration efforts and our ability to integrate external traffic. Second, by layering scenario-specific benefits on top of our core capabilities, we have effectively lowered the barrier to entry for shippers and deepened user stickiness. The foundational infrastructure we have built over time across intelligent matching, fulfillment protection, and freight pricing represent the bedrock of our ability to consistently attract and retain SME shippers. In the first quarter, while continuing to strengthen the long-haul transportation experience, we also introduced targeted products benefits for specific use cases. For example, a fee waiver for order posting within 200 kilometers. And these initiatives further lowered onboarding threshold for smaller shippers and ensure a reliable service experience across a broader range of transportation scenarios. Third, our WECON operations and referral-driven acquisitions have solidified into a powerful dual engine for user growth. In the first quarter, we continue to scale our WECOM outreach, leveraging high-frequency targeted engagement to effectively reactivate our existing user base, notably peer-to-peer referrals, i.e. existing shippers bringing in new ones, remaining our highest ROI and highest quality acquisition channel. Shippers acquired through referrals consistently outperform platform average on key metrics, including order fulfillment rates and long-term retention. Looking into the rest of the year, we will sharpen our focus on the quality and sustainability of user growth through continued strong execution of our multi-pronged user acquisition strategy anchored in branding, product benefits, and referral-driven programs. We will keep refining our channel mix and rolling out scenario-specific product benefit to elevate acquisition efficiency and strengthen our brand presence among targeted users. In addition, we will deepen our commitment to user satisfaction, bolstering our service capabilities and protection mechanisms to strengthen trust and reinforce our professional reputation. Taken all together, these efforts will lay a solid foundation for sustainable and long-term growth. Thank you.

Thank you. Your next question comes from Richie Sun with HSBC.

Please go ahead. Thank you, management, for taking my questions. I want to ask about truckers' activities. Can you share how trucker engagement trended in the first quarter and has all the acceptance frequency amount active truckers continue to improve? Thank you.

Thank you, Richie. In the first quarter, transportation capacity across the platform remained abundant and the supply mix continued to improve. Monthly active truckers responding to orders held steady at about 3 million, providing a solid backbone for fulfillment on our platform. Within newly onboarded active trucker capacity, the share of new energy vehicles continued to grow and supported by their lower operating costs and favorable policy tailwinds. they have emerged as an increasingly important supply source of high-quality carrier capacity on our platform. Besides, increasing order acceptance frequency among active truckers was one of our key operational priorities this quarter, underpinned by a series of systemic upgrades to our fulfillment protection mechanism and trucker-facing tools. First, freight payment protection has been extended to all truckers significantly reducing perfumery-related risks. We expanded the program from members-only truckers to our full trucker base, and it now covers more than 90% of the freight listings on the platform. For others carrying the protection label, in the event of freight payment delays or defaults, the platform will proactively intervene to assist with recovery efforts. If the dispute remains unresolved after the overdue period, the platform will directly cover the shortfall. This mechanism has effectively addressed truckers key concerns around payment security and significantly boosting their willingness to accept orders and loyalty to the platform. Second, we have deeply linked benefits with trucker credit rating to foster a healthier ecosystem. Specifically, core cargo finding features such as Our instant cargo function are now directly tied to trucker credit rating, and truckers with stronger fulfillment records and higher service quality receive more reliable access to premium freight opportunities. This has created a powerful positive incentive mechanism on the capacity side of the platform. Lastly, our accelerating deployment of AI capabilities is driving meaningful individual efficiency gains. We're currently piloting an AI assistant for truckers that provides intelligent support across high-frequency transactional touch points, such as cargo finding, price negotiation, and query resolution. The reason trucker data is encouraging, the average number of fulfilled orders per active trucker continue to rise year over year in the first quarter, while the median time to transaction completion remains near historical lows. This suggests that the convergence of increasing high-quality freight supply, ongoing matching algorithm iteration, and AI-powered tools enable truckers to respond to orders faster and chain trips more tightly, meaningfully, improving overall vehicle utilization at the individual level. We will remain focused on enhancing the trucker experience, refining protection mechanisms, and upgrading tools and products. This means strengthening foundational systems such as freight payment protection and credit rating mechanisms to increase truckers' confidence in our fulfillment, while also leveraging digital tools such as our AI Assistant to improve truckers' order acceptance efficiency and unit economies. These initiatives will collectively strengthen our capacity base and support sustained growth, order growth, and increased fulfillment across our platform. Thank you.

Thank you. Your next question comes from Wenjie Zhang with CICC. Please go ahead.

Hello, Mr. Guan. Thank you for accepting my question. Congratulations to the company for achieving such a good performance in the first quarter. I saw that our income in the first quarter achieved a 33-year high. Thank you, management, for taking my question. We saw that Commission revenue grew by 33% year-over-year in the first quarter. What are the key drivers behind this, and what's the outlook for Commission revenue going forward?

Thank you, Wenjie. As order volume growth gradually recovered in the first quarter, transaction service revenue maintained strong growth momentum, primarily driven by two factors. First, an increase in high quality orders significantly improved the commission penetration rate, which was the core growth driver of transaction service revenue this quarter. In the first quarter, commission penetration rate exceeded 94%, up roughly nine percentage points year over year. This sharp increase was largely attributable to our ecosystem governance efforts in prior quarters. As low quality and abnormal orders such as misclassified carpooling and cargo reselling are being structurally phased out, the supply of authentic high quality orders has increased significantly and fulfillment rates have reached new highs for several consecutive quarters. This has allowed our commission model to extend smoothly and sustainably into a broader range of business scenarios. Second, average monetization per order climbed at a moderate, healthy pace. In the first quarter, average monetization per order reached roughly RMB 26.9, sustaining its steady year-over-year upward trend. And this growth is structurally very sound, underpinned by two factors. First, the optimization of our tiered operations and refined pricing strategy continue to drive monetization efficiency within the existing commission scenarios. Second, there's a large volume of new orders that's been brought into the commission system earlier this year. While these incremental orders generate lower initial commission rates and created modest Newton dilution, They present substantial monetization opportunities as we continue to drive higher average monetization per order over time. Looking ahead, we remain confident in the continued growth of our transaction service revenue. As newly monetized orders gradually mature and we continue to optimize our tier to refine operations, we believe there's still room for improvement in both commission penetration and average monetization per order. At the same time, ongoing enhancement to our trucker membership system and the normalization of ecosystem governance will keep a stable, high-quality capacity base in place, reinforcing the foundation for transaction service revenue growth. While maintaining our commitment to ecosystem health and user experience across both sides of the platform, We will continue to gradually optimize our monetization structure and driving transaction service revenue towards a more resilient and sustainable long-term goals trajectory. Thank you.

Thank you. Your next question comes from Yuan Liao with Citix.

Please go ahead. Thank you, Mr. Zhang, Mr. Sam, Mr. Mao, and Ms. Emma for accepting my question. And congratulations to EG2 for its strong performance. When we look at EG2, the company's bidding business is obviously exceeding expectations. My question is, I don't know if Mr. Guan can share with us the progress of our bidding business, EG2 business transformation. And then I have another question about our AI. In the current industry, how is the AI progress? I want to ask how the AI is currently used in the company. I have two questions. The first is, can management share an update on the progress of the freight brokerage business transformation in the first quarter? And second question is related to AI, and could you share how AI is being applied across your company? And what is the key developments in the first quarter? And what is your plan R for 2026? Thank you.

Thank you, Yuan. So starting with our first question on freight brokerage, our freight brokerage business maintains stable operations in the first quarter with ongoing improvements to both business structure and operating model. Beginning in this year, the business has formally transitioned into a dual track model operating its own proprietary business in parallel with aggregator model. Under the self-operated model, an extension of traditional freight brokerage business with revenue recognized on the freight brokerage business service item, FTA directly manages invoicing and settlement workflows. This model primarily serves SME shippers with genuine freight demand by providing a fully integrated end-to-end solution that combines VAT invoices issuance with freight matching. Operations have continued at their established pace with take rate or service fee remaining stable at around 10%. Under the aggregator model, this is a newly introduced track with revenue recognized under value added services segment. That's invoicing and settlement are handled by qualified third party ecosystem partners while FDA focuses on the underlying freight matching and capacity allocation, earning a channel service fee of roughly 1 to 2% per order. This effectively repositioned the invoicing business from a GMB-driven model, where the platform previously assumed full invoicing and settlement obligations, to an SLI channel distribution model. From an operational standpoint, The decline of self-operated invoicing volume is the near-term outcome of our deliberate decision to reduce our self-operated exposure amid the evolving policy environment. From an asset quality perspective, the customers we retained under this model remain predominantly SOE shippers with genuine freight demand, with the invoicing plus freight matching orders representing the substantial majority of the transactions. Meanwhile, the aggregator model has ramped up steadily since the first quarter launch, with associated revenue beginning to flow through under the value added services. Strategically, the transition to a due track self-operated and aggregator model delivers three distinct benefits. First, it materially reduces direct exposure to regulatory policy risk. Under the aggregator model, the platform no longer bears direct invoicing and settlement obligations, fundamentally mitigating uncertainties from potential policy changes. Second, it enables an effort lighter operating profile and sharpens our focus on core freight matching capabilities while reducing both capital deployment and operating costs. Thirdly, it strengthens shipper retention By leveraging aggregated partners to meet shippers' invoicing compliance needs, we're better positioned to keep users engaged within our freight matching ecosystem. Financially, the invoicing business was never intended to be a core profit center. Rather, it serves as a operational infrastructure that anchors shipper loyalty and broadens the boundaries of our ecosystem. What we prioritize is the boost from the freight brokerage business to our core freight matching activity and the structural improvement it brings to our user mix. Looking ahead, we will continue to gradually transition the freight brokerage business away from the self-operated model towards the aggregated model. This shift will ensure shippers' invoicing needs are continuously served while enabling the invoicing business to operate on a lighter, more sustainable footing within the evolving regulatory environment, better supporting the long-term development of our core platform business. So that's the response to your first question. Moving on to your question on AI. In the first quarter, our AI Initiatives advance from exploratory phase to a stage of targeted capability refinement and focused testing. Centered on the core shipper transaction journey, we are progressively building an AI agent framework spanning the full transaction and fulfillment lifecycle and encompassing dedicated agents for shipment posting, freight matching, and order fulfillment, alongside with AI-powered customer service. Our key developments in the quarter were concentrated across the following product lines. For the shipment posting agent, we continued to build on last quarter's strategy around simplified posting and automated dispatch. We steadily expanded the pilot among direct shippers, sustaining a high end-to-end success rate. Pilot results show that fulfillment rates on AI-assisted posting were materially above average. That's a strong testament to the power of AI-driven matching in improving fulfillment efficiency. Looking ahead, we will plan to introduce multi-modal capabilities such as screenshot-based posting to further streamline the posting experience. while integrating WeCon and open APIs to meet enterprise system integration needs and improve posting efficiency. From our matching and fulfillment agents, for our matching and fulfillment agents, core underlying capabilities went live in the first quarter and since then we have continued to refine their performance across intelligence query resolution, price negotiation, and complex scenario handling. The matching agent focuses on dynamic negotiation strategies across varying transaction scenarios alongside growing real-time voice interaction capabilities. This fulfillment agent centers on shipment tracking, intelligent customer support, and deep intervention in high-frequency exceptions such as late arrivals and cancellations. and steadily establishing an automated exception handling mechanism across the platform. On the trucker side, our AI assistant continue to support high frequency decision points such as freight finding and price negotiation and improving matching efficiency for truckers and unlocking latent capacity on the platforms. Meanwhile, we continue to improve issue resolution efficiency and response speed. within our AI-powered customer service system, driving structural improvements in both overall service quality and operating expenses. Looking ahead, we believe AI will continue to serve as the core technology foundation for improving operational efficiency and user experience across our platform. As we continue to refine our matching and fulfillment agents, we are we are also deepening the integration of our underlying models with the platform's high-frequency real-world transaction data, enabling AI to unlock greater value across matching efficiency, operating cost optimization, and user experience. Thank you.

Thank you. That concludes the question and answer session. I would like to turn the conference back over to management for any additional closing remarks.

Thank you once again for joining us today. If you have further questions, please feel free to contact Full Track Alliance directly or reach out to CPG. Our contact information for AI in both China and the U.S. can be found in today's press release. Have a good day. Thank you.