Summary of Smoore International Conference Call Company Overview - **Company**: Smoore International - **Date**: March 18, 2026 Key Financial Performance - **2025 Performance**: - Revenue increased by 20.8% year-on-year - Net profit was 1.062 billion RMB, a decline of 18.5% - Adjusted net profit (excluding stock incentive expenses) was 1.53 billion RMB, a growth of 1.3% - Mature vaping business contributed nearly 2 billion RMB in profit - Key detractors included emerging businesses (medical and beauty vaping) still in investment phase and approximately 500 million RMB in stock incentive expenses [2][3] - **2026 Expectations**: - Revenue expected to achieve double-digit year-on-year growth - Vaping business revenue projected to grow double digits, driven mainly by the European market - HNB business revenue target set at over 2 billion RMB, representing a growth of over 55% from 1.287 billion RMB in 2025 - Shipment target set at over 7 billion units, with a mid-term goal of 20 billion units - Adjusted net profit forecasted conservatively at 1.5 to 1.6 billion RMB, expected to remain flat compared to 2025 [2][3][4] Business Segment Performance - **ToB Business**: - Revenue increased by 21.7% year-on-year - HNB business revenue was 1.287 billion RMB, slightly above the previous guidance of 1.2 billion RMB - European vaping business revenue reached 5.77 billion RMB, up 18.5% - U.S. vaping business revenue was 4.072 billion RMB, up 2.1%, marking a return to positive year-on-year growth [3][4] - **ToC Business**: - Revenue increased by 20% year-on-year in the second half of 2025 [4][5] Market Expectations and Valuation - **Market Focus**: - Core market expectations are centered on the growth potential of HNB and other new businesses - Current new businesses are still in the investment phase, making performance contributions difficult to assess - Close monitoring of HNB business development speed, growth, and profit realization capability is necessary [2][6] - **Valuation**: - As of March 18, 2026, the company's market capitalization was 55.2 billion RMB - Based on the adjusted net profit of approximately 1.55 billion RMB for 2026, the corresponding price-to-earnings ratio is about 34 times [2][6]