Financial Data and Key Metrics Changes - Fourth quarter net sales reached over $3.26 billion, with total fiscal year 2025 net sales exceeding $12.6 billion, reflecting year-over-year growth of 8.1% in Q4 and 8.3% for the full year [19] - Active customers increased to 21.3 million, up approximately 4% year-over-year, with net additions exceeding 810,000 for fiscal 2025 [19] - Gross margin for Q4 was 29.4%, and for the full year 2025, it was 29.8%, representing approximately 90 basis points of year-on-year margin expansion in Q4 and 60 basis points for the full year [20][24] - Adjusted net income for Q4 was $150 million, translating to $0.27 adjusted earnings per share, while full year adjusted net income was $541 million, or $1.27 per share [23] Business Line Data and Key Metrics Changes - Autoship customer sales reached over $2.7 billion in Q4, accounting for 84% of total net sales in Q4 and 83.3% for the full year 2025, with growth in Autoship sales outpacing overall top-line growth [20] - NSPAC (Net Sales Per Active Customer) reached $591 in Q4 2025, increasing by approximately 4% year-over-year [20] Market Data and Key Metrics Changes - The pet industry is expected to see low single-digit growth, with dog growth at the lower end and cat growth at the higher end of that range [9] - The shift towards e-commerce penetration is anticipated to continue, benefiting scaled digital platforms like Chewy [9] Company Strategy and Development Direction - Chewy aims to focus on disciplined execution, profitable growth, continued margin expansion, and strong free cash flow generation to support long-term shareholder value [8] - The company is expanding its Chewy Vet Care initiative, having opened 10 new practices in 2025, which is expected to drive customer acquisition and engagement [12] - Chewy is leveraging AI to enhance customer experience and operational efficiency, with expectations of significant cost savings from AI applications in the future [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the pet industry's resilience and Chewy's ability to gain market share despite macroeconomic challenges [9] - The company anticipates continued margin expansion in 2026, driven by SG&A leverage and efficiencies from AI [11][29] - Chewy's model does not depend on a minimum net sales growth threshold to expand profitability, indicating a strong operational framework [12] Other Important Information - Chewy repurchased approximately 6.8 million shares, spending about $257 million on share repurchases in 2025 [26] - The company ended the year with approximately $879 million in cash equivalents and marketable securities, remaining debt-free [25] Q&A Session Summary Question: A&M leverage and Chewy Made strategy - Management expects to show A&M leverage going forward, with a target of spending around 6% to 6.5% in the near term [37][39] - The Chewy Made strategy aims to increase private brand penetration, which is expected to yield higher gross margins compared to the base business [43][45] Question: AI applications and efficiency gains - AI is being applied across customer service, fulfillment, and marketing operations to improve efficiency and reduce costs [49][51] - Management aims to balance efficiency gains with reinvestment in the business to support growth and profitability [54] Question: Net customer adds and pet adoption cycle - The increase in net customer adds is attributed to both broader trends in pet adoption and Chewy's performance in marketing [90]

Financial Data and Key Metrics Changes - In the second half of 2025, the company reported total revenue of CNY 951 million, with a net income attributable to ordinary shareholders of CNY 21.2 million. For the full year, total revenue reached CNY 2.4 billion, representing a year-over-year increase of 14.6% [4][5] - The net income attributable to ordinary shareholders for the full year was CNY 141.6 million, with a net profit margin of 5.8% [5][18] - The company recorded net revenue of CNY 950.6 million for the second half of 2025, a decrease of 25.9% from CNY 1,282.4 million for the same period in 2024 [12] Business Line Data and Key Metrics Changes - Revenues from home water systems were CNY 628.2 million, a decrease of 32.1% from CNY 925.7 million for the same period in 2024 [12] - Revenues from consumables were CNY 112.2 million, a decrease of 17.9% from CNY 133.7 million for the same period in 2024 [13] - Revenues from kitchen appliances and others were CNY 210.2 million, a decrease of 4.5% from CNY 220 million for the same period in 2024 [13] - For the full year, revenues from home water systems were CNY 1,686.6 million, an increase of 12.6% from CNY 1,498.4 million for 2024 [16] Market Data and Key Metrics Changes - In the North American market, the Amazon channel achieved triple-digit growth in sales on a sequential basis [6] - The company ranked 19th in sales on Amazon U.S. and 10th among annual brands listed on JD in 2025 [23] Company Strategy and Development Direction - The company aims to deepen its presence in core strategic markets such as North America and Southeast Asia, with plans to launch new localized production [10] - The focus will be on enhancing the health-centric positioning of the Kunlun series and integrating AI across water purification scenarios [10] - The company plans to broaden its product lineup, including higher-margin whole-home filtration systems and multifunctional countertop products [28] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the impact of the national subsidy reduction on the domestic market, predicting challenges in the first half of 2026 but expecting a return to normal growth pace thereafter [33] - The company anticipates a triple-digit growth in overseas revenue for 2026, despite geopolitical tensions and uncertainties [25] Other Important Information - The company declared a special dividend of $0.088 per ADS in July 2025 and another special dividend of $0.06 per share, totaling CNY 31 million for shareholder return [9] - The company has surpassed 1,950 global patent applications, enhancing its technological capabilities [8] Q&A Session Summary Question: Overall performance of the company's self-owned brand in 2025 - The brand revenue was primarily from domestic online channels, ranking 10th on JD and 19th on Amazon U.S. Future strategies include launching distinct brands for North America [22][23] Question: Differences in market strategies between the U.S. and Malaysia - Local teams have been established for both markets, with a focus on online channels in the U.S. and offline partnerships in Malaysia [24][25] Question: Pathways for enhancing profitability moving forward - Three main paths include expanding overseas markets, increasing consumables revenue, and broadening the product lineup [26][28] Question: Impact of national subsidy reduction on the domestic market - The company expects challenges in the first half of 2026 but anticipates a return to normal growth pace for water purifiers [32][33] Question: Long-term growth outlook for the business - The company estimates a potential nominal growth rate of low double digits by 2027, driven by brand strength and international market expansion [38][40]

Financial Data and Key Metrics Changes - Fourth quarter net sales reached over $3.26 billion, with total fiscal year 2025 net sales exceeding $12.6 billion, reflecting year-over-year growth of 8.1% in Q4 and 8.3% for the full year [18] - Active customers increased to 21.3 million, up approximately 4% year-over-year, with net additions exceeding 810,000 for fiscal 2025 [18] - Gross margin for Q4 was 29.4% and 29.8% for the full year, showing approximately 90 basis points of year-on-year expansion in Q4 and 60 basis points for the full year [19][20] - Adjusted EBITDA for fiscal 2025 was $719 million, with a margin of 5.7%, reflecting a 26% year-over-year growth [22] Business Line Data and Key Metrics Changes - Autoship customer sales reached over $2.7 billion in Q4, representing 84% of total net sales in Q4 and 83.3% for the full year, with growth in Autoship sales outpacing overall top-line growth [19] - Chewy Vet Care opened 10 new practices in 2025, bringing the total to 18 locations, with performance exceeding expectations and driving customer acquisition [10][11] Market Data and Key Metrics Changes - The pet industry is expected to see low single-digit growth, with dog growth at the lower end and cat growth at the higher end of that range [7] - The shift towards e-commerce is anticipated to continue, benefiting scaled digital platforms like Chewy [7] Company Strategy and Development Direction - Chewy aims to focus on disciplined execution, profitable growth, margin expansion, and strong free cash flow generation to support long-term shareholder value [6] - The company is leveraging AI to enhance customer experience and operational efficiency, with expectations of significant cost savings in the coming years [11][14] - The launch of Chewy Made, a unified owned brand platform, is expected to drive durable, profitable growth by expanding product offerings at accessible price points [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the pet industry's resilience and Chewy's ability to gain market share despite macroeconomic challenges [6][7] - The company anticipates continued margin expansion and strong free cash flow generation in 2026, independent of macroeconomic conditions [9][10] Other Important Information - Chewy repurchased approximately 6.8 million shares, spending about $257 million on share repurchases in 2025 [23] - The company ended the year with approximately $879 million in cash equivalents and marketable securities, remaining debt-free [23] Q&A Session Summary Question: A&M leverage and Chewy Made strategy - Management expects to show A&M leverage going forward, with a target of reaching 10% EBITDA margin in the long term, with a mix of gross margin and SG&A improvements [36][38] - The Chewy Made strategy aims for mid-teens penetration of net sales, with expectations of higher gross margins compared to the base business [38][39] Question: AI applications and efficiency gains - AI is being applied across customer service, fulfillment, and marketing operations to reduce costs and improve service efficiency [45][46] - Management aims to balance efficiency gains with reinvestment in the business to support growth and profitability [50] Question: Net customer adds and pet adoption cycle - The increase in net customer adds is attributed to both broader pet adoption trends and Chewy's performance marketing efficiency [84] - Management does not expect significant changes in pet household formation but aims to gain wallet share through key initiatives [84]

Financial Data and Key Metrics Changes - In the second half of 2025, the company reported total revenue of CNY 951 million, with a net income attributable to ordinary shareholders of CNY 21.2 million, reflecting a year-over-year increase of 14.6% for the full year, totaling CNY 2.4 billion [4][5] - The net income for the full year was CNY 141.6 million, with a net profit margin of 5.8% [5][18] - The company recorded a gross margin of 25.3% for the full year, slightly down from 25.9% in 2024 [17] Business Line Data and Key Metrics Changes - Revenue from home water systems decreased by 32.1% to CNY 628.2 million in the second half of 2025, primarily due to a decline in additional service fees for water purifiers [12] - Revenues from consumables were CNY 112.2 million, down 17.9% from the previous year, attributed to decreased sales of water purifier filters [13] - Revenues from kitchen appliances and others increased by 47.6% to CNY 506.2 million for the full year, indicating a strong performance in this category [17] Market Data and Key Metrics Changes - In the North American market, the Amazon channel achieved triple-digit growth in sales during the second half of 2025, with products ranking nineteenth in the water purifier category [5][6] - In Southeast Asia, the company launched a compact Inno mineral water dispenser tailored for local market preferences [6] Company Strategy and Development Direction - The company aims to deepen its presence in core strategic markets like North America and Southeast Asia, with plans to launch new localized production [9] - The focus will be on enhancing the health-centric positioning of the Kunlun series and integrating AI technology across water purification scenarios [9] - The company plans to broaden its product lineup, including higher-margin whole home filtration systems and multifunctional countertop water dispensers [28] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the impact of the national subsidy reduction on domestic market performance, expecting challenges in the first half of 2026 but anticipating a return to normal growth pace thereafter [33] - The company sees strong opportunities for global expansion despite geopolitical tensions and aims for triple-digit growth in overseas revenue for 2026 [25][9] Other Important Information - The company declared a special dividend of $0.088 per ADS in July 2025 and another special dividend of $0.06 per share, totaling CNY 31 million for shareholder returns [8] - The company has surpassed 1,950 global patent applications, enhancing its technological capabilities in water purification [7] Q&A Session Summary Question: Overall performance of the company's self-owned brand in 2025 - The brand revenue was primarily from domestic online channels, ranking 10th on JD and 19th on Amazon U.S. Plans include launching distinct brands for North America [22][23] Question: Differences in market strategies between the U.S. and Malaysia - Local teams have been established for both markets, with a focus on online channels in the U.S. and offline partnerships in Malaysia [24][25] Question: Core pathways for enhancing profitability moving forward - Key pathways include expanding overseas markets, increasing consumable revenues, and broadening the product lineup [26][27] Question: Impact of national subsidy reduction on the domestic market - The reduction has significantly impacted revenue, but demand for water purifiers is expected to grow despite the subsidy removal [32][33] Question: Long-term growth rate expectations - The company anticipates a nominal growth rate of low double digits in 2027, driven by brand strength and international market expansion [38][39]

Financial Data and Key Metrics Changes - In the second half of 2025, the company reported total revenue of CNY 951 million, with a net income attributable to ordinary shareholders of CNY 21.2 million. For the full year, total revenue reached CNY 2.4 billion, representing a year-over-year increase of 14.6% [4][5] - The net income attributable to ordinary shareholders for the full year was CNY 141.6 million, with a net profit margin of 5.8% [5][19] - The company recorded net revenue of CNY 950.6 million in the second half of 2025, a decrease of 25.9% from CNY 1,282.4 million for the same period in 2024 [12] Business Line Data and Key Metrics Changes - Revenues from home water systems were CNY 628.2 million, a decrease of 32.1% from CNY 925.7 million for the same period in 2024, primarily due to a decline in additional service fees for water purifiers [12] - Revenues from consumables were CNY 112.2 million, a decrease of 17.9% from CNY 133.7 million for the same period in 2024 [13] - Revenues from kitchen appliances and others were CNY 210.2 million, a decrease of 4.5% from CNY 220 million for the same period in 2024 [13] Market Data and Key Metrics Changes - In the North American market, the Amazon channel achieved triple-digit growth in sales on a sequential basis, with products ranking nineteenth in the water purifier category during Black Friday [5] - In Southeast Asia, the company launched the compact Inno mineral water dispenser tailored for the local market [6] Company Strategy and Development Direction - The company aims to deepen its presence in core strategic markets such as North America and Southeast Asia, with plans to launch new localized production and extend brand influence [10] - The focus will be on enhancing the health-centric positioning of the Kunlun series and integrating AI across water purification scenarios [10] - The company plans to broaden its product lineup, including higher-margin whole home filtration systems and multifunctional countertop water dispensers [28] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the impact of the national subsidy reduction on the domestic market, expecting challenges in the first half of 2026 but anticipating a return to normal growth pace thereafter [34] - The company sees strong opportunities globally despite geopolitical tensions and believes it is well-positioned for future growth [26] Other Important Information - The company declared a special dividend of $0.088 per ADS in July 2025 and another special dividend of $0.06 per share, totaling CNY 31 million for shareholder return [9] - The company has surpassed 1,950 global patent applications, enhancing its technological capabilities [8] Q&A Session Summary Question: Overall performance of the company's self-owned brand in 2025 - The brand revenue was primarily from domestic online channels, ranking 10th on JD and 19th on Amazon U.S. Plans include launching distinct brands for North America [24] Question: Differences in market strategies between the U.S. and Malaysia - Local teams have been built for both regions, with a focus on online channels in the U.S. and offline partnerships in Malaysia. The goal for 2026 is triple-digit growth in overseas revenue [26] Question: Pathways for enhancing profitability in the next 2-3 years - Three main paths include expanding overseas markets, increasing consumable revenues, and broadening the product lineup with higher-margin options [28]

Financial Data and Key Metrics Changes - Fourth quarter net sales reached over $3.26 billion, with total fiscal year 2025 net sales exceeding $12.6 billion, reflecting year-over-year growth of 8.1% in Q4 and 8.3% for the full year 2025 [18] - Active customers increased to 21.3 million, up approximately 4% year-over-year, with net additions exceeding 810,000 for fiscal 2025 [18] - Autoship customer sales reached over $2.7 billion in Q4, representing 84% of total net sales, with growth in Autoship sales outpacing overall top-line growth, increasing nearly 13% in Q4 [19] - Fourth quarter gross margin was 29.4%, with full year gross margin at 29.8%, indicating approximately 90 basis points of year-on-year margin expansion in Q4 [19] - Free cash flow for fiscal year 2025 was $562.4 million, a record high for the company, highlighting improved earnings quality and capital efficiency [23] Business Line Data and Key Metrics Changes - Chewy Vet Care opened 10 new practices in 2025, bringing the total to 18 locations, with performance exceeding expectations and driving customer acquisition [11] - The company reported strong growth in Sponsored Ads and premium product categories, contributing to gross margin improvements [20] Market Data and Key Metrics Changes - The pet industry is expected to experience low single-digit growth, with dog growth at the lower end and cat growth at the higher end of that range [7] - The shift towards e-commerce is anticipated to continue, benefiting scaled digital platforms like Chewy [8] Company Strategy and Development Direction - Chewy aims to focus on disciplined execution, profitable growth, and margin expansion to support long-term shareholder value [6] - The company is leveraging AI to enhance customer experience and operational efficiency, with expectations of significant cost savings in the coming years [14] - The launch of Chewy Made, a unified owned brand platform, is designed to deliver high-quality products while driving profitable growth [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver sustained earnings growth and margin expansion in 2026, independent of macroeconomic conditions [10] - The company does not expect a meaningful rebound in pet household formation but remains optimistic about stable demand and share gains [7][64] Other Important Information - The company repurchased approximately 6.8 million shares in 2025, spending about $257 million on share repurchases [24] - Chewy's capital allocation strategy remains focused on advancing strategic priorities, maintaining a strong balance sheet, and returning excess cash to shareholders [24] Q&A Session Summary Question: A&M leverage and Chewy Made strategy - Management expects to show A&M leverage going forward, with a target of reaching 10% EBITDA margin in the long term, driven by gross margin improvements and SG&A efficiencies [36] - The Chewy Made strategy aims for mid-teens penetration of net sales, with expectations of higher gross margins compared to the base business [38] Question: AI applications and efficiency gains - AI is being applied across customer service, fulfillment, and marketing operations to improve efficiency and reduce costs [46] - Management aims to balance efficiency gains with reinvestment in the business to support growth and profitability [51] Question: Customer adds and pet household formation - Management does not expect improvements in pet household formation to impact forecasts, attributing customer adds to seasonality and effective go-to-market strategies [64]

Financial Data and Key Metrics Changes - Fourth quarter revenue grew 24% to $12.5 million, reflecting continued sequential and year-over-year growth driven by consistent production improvement across the full network of facilities [15] - Adjusted gross margin for the fourth quarter was approximately 29%, compared to approximately 25% in Q4 of last year, representing roughly 400 basis points of year-over-year improvement [15] - Adjusted SG&A expense for the fourth quarter was $4.3 million, down from $5.3 million in Q4 2024, representing a reduction of approximately 18% year-over-year [16] - Adjusted EBITDA loss for the fourth quarter improved to $5.8 million, compared to a loss of $9.3 million in Q4 2024, marking a 38% year-over-year improvement [16] - GAAP net loss for Q4 was $8.7 million, compared to $36.3 million in the prior year period, reflecting a substantially lower interest expense due to debt restructuring [16][17] Business Line Data and Key Metrics Changes - All three state-of-the-art facilities are now operating at full harvestable capacity, with the entire capacity committed to customers on a run-rate basis [5] - The Romano Caesar salad kit has seen significant traction, with average units per store per week increasing by approximately 75% from Q3 to Q4 [8] - The company is focused on achieving targeted diversification of its channel mix to enhance its margin profile, with new retail accounts expected to launch in the coming months [7] Market Data and Key Metrics Changes - The market has shifted as retailers and strategic partners are now designing supply chains that include controlled environment agriculture (CEA) as permanent infrastructure [6] - There is a notable supply gap in the market for conventional arugula, which the company aims to address with a more reliable, greenhouse-grown supply [9] Company Strategy and Development Direction - The company is focused on optimizing operations and enhancing commercial momentum, with ongoing strategic partnership discussions central to long-term growth [5] - The company aims to maximize value for shareholders by optimizing the quality of volume rather than just adding capacity [6] - The recent $15 million investment from an existing strategic investor provides meaningful financial flexibility as the company advances its priorities in 2026 [4] Management's Comments on Operating Environment and Future Outlook - The strategic and commercial environment is increasingly favorable, with expectations for continued revenue growth, gross margin stability, and declining SG&A [18] - The company believes that the cumulative progress made will become more visible in 2026, aiming to build a durable, profitable business [18][19] Other Important Information - The company was issued a U.S. patent for optimizing the growing process using computer vision and AI, which protects proprietary methods underpinning its Stack & Flow technology platform [14] - The company completed a $25 million equity raise and comprehensive debt restructuring in Q1, which canceled approximately $197 million of debt principal and interest [17] Q&A Session Summary - No specific questions or answers were provided in the content, thus this section is not applicable.

Financial Performance and Key Metrics - For fiscal year 2025, revenue reached CNY 3.98 billion, up 43.5%, with net profit attributable to ordinary shareholders at CNY 570 million, a year-on-year growth of 64.8% [3][18] - The company achieved GAAP profitability for 16 consecutive quarters, with the insurtech segment revenue surging 61.3% and an operating margin of approximately 18% [3][18] - Operating costs for the fourth quarter reached CNY 680 million, a 109.2% year-over-year increase, driven by referral and service fees [16] Business Line Performance - Insurance-related income surged 125% year-over-year to CNY 1.31 billion, while operating profits grew 42% year-over-year to CNY 160 million [7] - Digital clinical trial revenue related to chronic disease increased by 30% this quarter compared to the previous three-quarter average [14] - Medical consulting services generated CNY 260 million, while digital clinical trial sourcing income was CNY 118 million [15] Market Data and Key Metrics - Approximately 490 million people have cumulatively donated CNY 72.3 billion to 3.68 million patients through the Waterdrop medical crowdfunding platform [11] - The company partnered with 224 pharmaceutical companies and enrolled a record 14,055 patients in its E-Find platform [12] Company Strategy and Industry Competition - The company is executing an AI plus insurance strategy, aiming to become an AI-native company by embedding AI as a structural competitive advantage [5][6] - The goal is to sustain momentum with moderately higher investment in marketing and AI, targeting double-digit growth in both revenue and profit [6] Management Commentary on Operating Environment and Future Outlook - Management expressed confidence in maintaining robust financial performance and highlighted the importance of AI integration across all service nodes [4][10] - The company aims to visually reconstruct its entire value chain, leveraging AI for operational gains and efficiency [5][6] Other Important Information - The board approved a cash dividend of $0.03 per ADS, totaling $10.8 million, to be paid in late April to early May [4] - As of year-end 2023, the company filed 72 LLM-related patent applications, including nine international ones [4] Q&A Session Summary - No specific questions and answers were provided in the content, thus this section is not applicable.

Financial Data and Key Metrics Changes - Revenue reached RMB 21.8 billion, a 16.7% increase from 2024, with a sequential growth of about 18% in the second half compared to the first half [25][26] - Adjusted net profit increased by 22% year-over-year to RMB 6.6 billion, with a margin expansion of 130 basis points to 30.2% [32][33] - Basic earnings per share grew from $0.82 to $1.22, a 49% increase [36] Business Line Data and Key Metrics Changes - Research and discovery services saw a doubling of upfront payments to $115 million, with potential milestone income streams exceeding $4 billion [26][27] - Development revenue grew by about 32% year-over-year, driven by 209 new projects, with 186 in the pre-IND space [28] - Manufacturing revenue from late-phase and commercial projects grew over 26% year-over-year, now representing over 43% of the total portfolio [29] Market Data and Key Metrics Changes - U.S. revenue accounted for 58% of total revenue, growing over 18%, while Europe contributed 23% with nearly 17% growth [16] - Japan and Korea experienced almost 70% growth, now making up 6.5% of total revenue [16] - China saw a slight decline in revenue, but adjusting for out-licensing deals shows a flat year-over-year growth [17] Company Strategy and Development Direction - The company emphasizes a unique CRDMO business model, focusing on bi-specifics, ADCs, and traditional mAbs to drive sustainable growth [3][4] - The strategy includes expanding capabilities in complex modalities, which are expected to enhance market share due to their challenging nature [20] - Continuous investment in technology and capacity expansion is planned, particularly in the U.S. and Singapore, to support future growth [59][60] Management's Comments on Operating Environment and Future Outlook - Management acknowledges geopolitical uncertainties but remains optimistic about revenue growth driven by a strong project funnel and backlog [25][30] - The company expects to maintain momentum in R&D and development services, with a focus on innovative platforms and complex modalities [26][28] - Future revenue growth is anticipated from the successful execution of projects and the expansion of manufacturing capabilities [29][58] Other Important Information - The company reported a significant increase in gross profit, reaching over RMB 10 billion, a 31% increase year-over-year [30] - The adjusted gross profit margin reached 48.8%, with a 340 basis points improvement year-over-year [37] - The company has a strong balance sheet with RMB 15.7 billion in cash, supporting accelerated global growth [41] Q&A Session Summary Question: What is the outlook for revenue growth in the coming years? - Management indicated that the revenue growth is expected to continue, driven by a strong project pipeline and successful execution of existing projects [25][30] Question: How does the company plan to address geopolitical uncertainties? - The company is focusing on diversifying its revenue streams and maintaining strong relationships with clients to mitigate risks associated with geopolitical issues [25][30] Question: What are the key drivers for the growth in the U.S. and European markets? - The growth in these markets is attributed to the increasing demand for complex modalities and the successful execution of large-scale projects [16][29]

Financial Data and Key Metrics Changes - In Q4 2025, the company's revenue reached RMB 123.9 billion, growing 12% year-on-year, while full-year revenue reached RMB 431.8 billion, up 10% year-on-year [6][22] - Net income attributable to ordinary shareholders was RMB 24.5 billion for Q4 and RMB 99.4 billion for the full year [26] - Basic earnings per ADS for Q4 were RMB 17.50, down from RMB 19.76 in the same quarter of 2024 [26] Business Line Data and Key Metrics Changes - Revenues from online marketing services were RMB 60 billion in Q4, up 5% year-on-year, while transaction services revenues were RMB 63.9 billion, up 19% year-on-year [22] - Total costs of revenues increased 15% in Q4 to RMB 55.2 billion, and 23% for the full year to RMB 188.8 billion [23] Market Data and Key Metrics Changes - The company has expanded its global business, now serving nearly 100 markets, despite facing challenges from a complex regulatory environment [31][34] - The e-commerce industry in China is experiencing a slowdown in growth, impacting the company's online marketing revenue growth [31][37] Company Strategy and Development Direction - The company launched the Hundred Billion Support Program to support merchants and improve corporate governance through a co-chair structure [5][17] - The strategic focus is on investing deeply in the supply chain and pursuing high-quality brand-oriented growth [5][14] - The company aims to transform its supply chain operations from scale-driven to value-driven, enhancing efficiency and quality [18] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenges posed by the evolving geopolitical landscape and regulatory scrutiny, emphasizing the need for compliance and adaptation [48][51] - The company remains committed to long-term investments in the supply chain, despite short-term fluctuations in profitability [56][58] Other Important Information - The company has implemented various initiatives to improve food safety and enhance service levels for consumers and merchants [13] - Significant investments have been made in agricultural research and development, with participation in global forums [20] Q&A Session Summary Question: How does the company maintain flexibility and quality of execution in a complex regulatory environment? - Management recognizes the need for systemic transformation in governance and operations to adapt to regulatory changes [34][36] Question: What is the company's view on the current state of the China e-commerce market? - Management notes a slowdown in growth and emphasizes the importance of creating value across the supply chain rather than relying solely on traffic acquisition [37][39] Question: What is the strategic focus for the global business amid regulatory inquiries? - The focus remains on investing in supply chain capabilities to ensure compliance and deliver value to consumers [49][55] Question: How should investors think about the company's long-term profit margin level? - Management indicates that fluctuations in profit margins are expected during the strategic investment phase, emphasizing long-term value over short-term performance [58][59]