UXIN

Ladies and gentlemen, thank you for standing by. Welcome to Uxin's Earnings Conference Call for the Quarter Ended December 31st, 2025. At this time, all participants are in a listen-only mode. After management's prepared remarks, there will be a Q&A session. Today's conference call is being recorded. If you have any objections, you may disconnect at this time. I would now like to turn the call over to your host for today's conference call, Ms. Allie Wang. Please go ahead, Allie.

Thank you, operator. Hello, everyone. Welcome to Uxin's Earnings Conference Call for the Fourth Quarter and Full-Year Ended December 31st, 2025. On the call with me today, we have DK, our Founder and CEO, and John Lin, our CFO. DK will review business operations and company highlights, followed by John, who will discuss financials and guidance. They will both be available to answer your questions during the Q&A session that follows. Before we proceed, I would like to remind you that this call may contain forward-looking statements, which are inherently subject to risks and uncertainties that may cause actual results to differ from our current expectations. For detailed discussions of the risks and uncertainties, please refer to our filings with the SEC. Now, with that, I will turn the call over to our CEO, DK. Please go ahead, sir.

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Good day to everyone, and thank you for your continued interest and support. It's a pleasure to welcome you on our earnings call today. To better communicate with our domestic and international investors, I will be discussing our performance over the last year, as well as providing insights into our prospects in both Chinese and English.

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China's vehicle ownership has approached 370 million units, forming a large and growing base that continues to unlock significant potential for vehicle recirculation. In 2025, used car transaction volume in China exceeded 20 million units for the first time, accounting for approximately 5.5% of total vehicle ownership, well below the 10%-15% level typically seen in more mature markets. As this percentage rises towards that level, annual used car transaction volume could reach 35 million-50 million units, based on current vehicle ownership alone.

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Consumer expectations for products, services, and overall experience in the used car industry continue to rise. We have observed that they are no longer satisfied with availability alone, and increasingly value transparency in vehicle conditions, fair pricing, professional service, and reliable after-sales support. We believe that in this trillion RMB market, which remains at an early stage of development, those who can systematically address these pain points will be well positioned to lead the transformation and upgrading of China's used car industry。

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Against this backdrop, Uxin is redefining used car transactions through a modern retail approach. We leverage our advanced self-operated reconditioning factories to ensure vehicle quality and provide a one-stop purchasing experience and comprehensive after-sales support through our offline superstores and online marketplace. As a result, buying and selling used cars could become as simple, transparent, and trustworthy as purchasing standardized retail products。

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In 2025, despite continued intense price competition in the new car market, which created challenges for the used car industry, our business maintained strong growth momentum. Our full-year retail transaction volume reached 51,110 units, up 135% year-over-year, marking the second consecutive year of more than 130% growth. Total revenues reached RMB 3.24 billion, representing a 79% increase year-over-year. Meanwhile, as both inventory and sales continued to scale up, our inventory turnover days for vehicles available for sale remained stable at approximately 30 days.

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During the year, we also began large-scale replication and nationwide expansion of our super store model. Building on our existing super stores in Hefei and Xi'an, we opened three new super stores in Wuhan, Zhengzhou, and Jinan, establishing a scalable operating system that can be replicated across regions. Our mature super stores in Xi'an and Hefei continued to ramp up, each achieving over 20% market share in their respective cities. Wuhan, as the first replicated super store after our model had been validated, delivered stronger sales growth and profitability than our earlier super stores at the same stage. Zhengzhou and Jinan super stores further improved upon Wuhan's performance.

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These achievements are supported by core capabilities that we have built over time and continue to strengthen. First, our pricing capability continues to evolve. We have accumulated the industry's largest set of real transaction data from our self-operated used car sales, and this data continues to grow, roughly doubling each year. This enables our pricing model to become increasingly precise. Our digital systems respond rapidly to market changes, allowing us to maintain real-time pricing competitiveness on both sourcing and sales. As a result, we are well positioned to navigate industry volatility and systematically improve vehicle-level profitability while sustaining high inventory and turnover efficiency.

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Second, we have built an innovative integrated factory warehousing retail business model. Each of our superstores is supported by a used car reconditioning factory, forming China's largest, most advanced and most efficient supply system for high-quality used vehicles. We have established scalable advantages over traditional dealers in quality control, reconditioning, efficiency and cost optimization. Leveraging the reconditioning capabilities at our self-operated factories, we have expanded the used car service value chain and are able to provide full-lifecycle vehicle services including financing, insurance, extended warranties, accessories and repair and maintenance services similar to those offered by new car dealers. Compared with traditional used car dealers that primarily offer financing services, our revenue streams are more diversified with greater potential for profitability improvement.

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Meanwhile, most of our superstores carry inventory of more than 2,000 vehicles and serves as a landmark used car retail destination in its local market. Landmark superstores help build customer trust. Through our in-store service, vehicle display and experience design, customers can enjoy a professional, transparent and trustworthy retail experience at our superstores. Our Net Promoter Score has reached 67, and customer satisfaction and brand reputation remain at industry-leading levels. We believe that our sales conversion efficiency, together with our ability to generate organic traffic through strong word of mouth, provides us with significant advantages over traditional used car dealers.

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We clearly see that Uxin is advancing rapidly along a validated and continuously strengthening development path. Looking ahead to 2026, we will continue to increase inventory and sales across our existing five superstores, and we plan to open four to six additional superstores during the year, further strengthening our nationwide network. Based on these plans, we expect both our full-year retail transaction volume in 2026 and revenue to grow by more than 100%.

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The modernization of China's used car industry has only just begun, and Uxin is positioned to benefit from a significant market opportunity. We also recognize that truly sustainable growth is not simply about speed, but is built on the coordinated improvement of scalability, operational efficiency, and customer value. We will remain focused on delivering better products and more professional services to our customers, while driving higher standards for solutions across the industry and creating long-term value for our shareholders.

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Once again, thank you for your trust and support.

[Non-English content] John, please。

With that, I'd like to turn the call over to our CFO to walk you through the financial results. John, please.

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Thank you, DK, and hello, everyone. I will now share an update on our financial performance.

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We delivered another quarter of strong results in the fourth quarter of 2025. Retail transaction volume reached 19,160 units, representing a 37% sequential increase and a 124% increase year-over-year, significantly outperforming the overall China used car market, which reported a year-over-year growth rate of approximately 6% during the same period. This demonstrates that our retail business remains firmly on a path of rapid growth.

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Total retail revenue for the quarter was RMB 1.129 billion, up 38% sequentially and 104% year-over-year. Our average selling price, or ASP for retail vehicles, decreased from RMB 65,000 in the same quarter last year to RMB 59,000 this quarter, but slightly increased from RMB 58,000 in the last quarter. While ASP declined as we shifted toward a more affordable inventory mix, the strong growth in transaction volume largely offset the pricing impact and supported overall revenue expansion. Our current inventory structure is well aligned with mainstream consumer demand, and we believe pricing has now stabilized at a rational level. As such, we expect ASP to remain relatively steady in the near term.

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On the wholesale side, we sold 2,474 units in the fourth quarter, up 31% sequentially and 180% year-over-year. Wholesale revenue for the quarter was RMB 38.2 million. Combining retail and wholesale operations, total revenue for the fourth quarter was RMB 1.198 billion, representing a 36% sequential increase and a 101% year-over-year increase.

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Our gross margin for the fourth quarter was 6.8%, down 0.7 percentage points from 7.5% in the last quarter. This was primarily due to promotional activities in the new car market during the fourth quarter, which put pressure on profitability across the used car industry. In addition, we opened a new superstore in Zhengzhou in September and another in Jinan in December. A newly opened superstore typically operate at lower gross margins during their early stages of ramp up.

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Operating expenses also increased during the quarter, primarily due to the initial ramp-up of our new superstores, including investments in staffing and infrastructure. As a result, our Adjusted EBITDA loss was RMB 27.2 million.

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Turning to our full-year 2025 results. Retail transaction volume totaled 51,110 units, representing a 135% year-over-year increase. Full-year retail revenue was RMB 3.021 billion, up 19% year-over-year. Total revenue reached RMB 3.24 billion, an increase of 79% year-over-year. In 2025, we opened three new super stores in Wuhan, Zhengzhou and Jinan, marking a new phase of rapid nationwide replication and expansion. These new super stores have ramped up more quickly than our earlier locations, continuing to drive growth in both our sales volume and overall financial performance.

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Gross margin for the full-year was 6.7%, remaining stable compared with last year. Despite lower margins during the early ramp-up stages of newly opened superstores, this continued improvement in profitability from our mature superstores enabled us to maintain stable margins while expanding rapidly.

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Turning to expenses as SG&A and R&D expenses totaled RMB 450 million, representing 13.9% of total revenue, a significant improvement from 24.3% last year, reflecting meaningful progress in cost control and operating leverage.

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Adjusted EBITDA loss for the full-year was RMB 57.9 million, narrowing by 28% year-over-year. Adjusted EBITDA margin was -1.8%, an improvement of 2.7 percentage points from last year. We have disclosed additional details regarding our full-year financial performance and our recently published fourth quarter and annual results, so I will not repeat all the figures here.

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Turning to our outlook for the first quarter of 2026. While the first quarter is traditionally a seasonally soft period for the used car industry due to the Chinese New Year holiday, we expect retail transaction volume to be between 16,200 units and 16,500 units, representing year-over-year growth of over 110%. Total revenue is expected to be between RMB 1.05 billion and RMB 1.07 billion.

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Lastly, to reiterate Kun Dai's comments on our full-year outlook. In 2026, we plan to open fourt to six new superstores with sales volume and inventory continuing to ramp up at our existing superstores. Along with new store openings, we are confident in achieving over 100% year-over-year growth in both retail transaction volume and revenues in 2026.

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This concludes our prepared remarks today. Operator, we're ready for question.

We will now begin the question and answer session. To ask a question, you may press star then one on your touch-tone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. At this time, we will pause momentarily to assemble our roster. The first question today comes from Dai Wenjie with SWS. Please go ahead.

Okay, thank you. Thank you for your comments. I'm Dai Wenjie. My first question is the company delivered another quarter of strong growth in both sales volume and revenue. Management also provide some color on the changes in gross margin. As you plan to open to 46 new superstores in this year, how should we think about the gross margin growing into 2026 and our ASP? Could Management share your latest view on used car pricing trends this year? Are you starting to see some signs of stabilization? Thank you.

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Thank you for the question. Let me take this one.

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Gross margin declined sequentially in the fourth quarter, mainly due to the ramp-up of newly opened superstores. We opened our Zhengzhou Superstore in September and our Jinan Superstore in December. During the initial ramp-up phase, we adopt a more competitive pricing strategy to drive traffic and establish market presence, resulting in a narrower spread between sourcing costs and selling prices compared to our mature stores. In addition, the penetration of value-added services also takes time to ramp up as our market share and brand recognition improve in these markets. It generally takes around six to nine months for new stores to reach the gross margin level of our mature stores. At the same time, our new car market experienced a slowdown in sales last December, and dealers stepped up promotional activities which put pressure on used car margins.

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According to our operating data for the first quarter of 2026, we have already seen meaningful improvement in the gross margins of our newly opened superstores in Zhengzhou and Jinan. Overall gross margin has begun to recover compared to the fourth quarter of 2025, and we expect it to return to above 7%.

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Regarding ASP, according to data from the China Automobile Dealers Association, the national average transaction price of used cars has started to recover since the fourth quarter of last year. We are seeing a similar trend in our own operating data. Our retail ASP increased sequentially for two consecutive quarters, reaching RMB 59,000 in the fourth quarter of 2025, and we expect it to exceed RMB 61,000 in the first quarter of 2026.

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In addition, due to factors such as rising raw material costs, the phase-out of purchase tax incentives and government subsidies, as well as regulatory guidance aimed at reducing excessive price competition, we expect new car pricing to become more stable in 2026 compared with the past three years. More stable new car pricing will also support used car prices. As a result, we expect our retail ASP to show a stable to upward trend in 2026 compared with 2025. Given that we expect retail transaction volume to grow by over 100% year-over-year in 2026, revenue growth is expected to outpace transaction volume growth.

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That's my answer. Thank you.

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Thank you.

The next question comes from Fei Dai with TF Securities. Please go ahead.

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I have a question on customer acquisition. How should we think about the customer acquisition channels for new superstores compared with your mature stores? Are there any key differences? Thank you.

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Thank you for the question. Let me address your question. Customer acquisition for new superstores mainly comes from three channels. First, Uxin is a well-recognized brand in China's used car market. As a result, whenever we enter a new city, we already have a certain level of traffic accumulation on the Uxin used car app in that market. This is a key difference compared with many regional dealers. In other words, during the initial ramp-up phase of a new superstore, we are able to leverage our existing brand awareness and online traffic base to reactivate and reengage existing users, bringing in the first batch of users and leads into the new market.

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Second, we typically carry out a series of marketing and PR campaigns around new superstore openings. In addition to targeted marketing on digital platforms, we also collaborate with local governments when launching new superstores. Local governments often provide promotional resources and local media support, which helps us quickly build awareness and reach potential customers in the new market.

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Third, we also partner with vertical automotive platforms and media to capture traffic and leads from third-party channels. Given the competitiveness of our vehicle quality and pricing, we are able to achieve strong exposure and conversion on these platforms.

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As the new stores continue to operate and mature in local markets, the cities where our superstores are located gradually become destination markets for car purchases and walk-in traffic increases over time. At the same time, as transaction volume scales up, customer satisfaction and brand reputation continue to build, and referrals from existing customers also increase, further improving conversion and creating a positive customer acquisition cycle.

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Overall, as new superstores continue to mature, the proportion of traffic generated by our strong product offering, service quality and customer experience continues to increase, and our customer acquisition costs continue to decline.

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That's my answer. Thank you.

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The next question comes from Li Xinxin with China Merchants Securities. Please go ahead.

[Non-English content] Congratulations on entering a new phase of nationwide expansion. From a long-term perspective, could management share some color on your store expansion potential across China, and how many superstores you think you can automatically roll out over time?

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Thank you for the question. Let me take this one. As of the end of 2025, we had five superstores in operation. In March this year, we opened a new superstore in Tianjin. We expect to open four to six superstores in 2026, with a goal of having more than 10 stores in operation by the end of 2026.

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We are very confident in our long-term store expansion potential across China, primarily because of the sheer size of the used car market. China's vehicle ownership has already exceeded 350 million units. On top of this large base, there are many cities that are well suited for deploying Uxin large-scale used car superstores. Our assessment of store expansion potential is mainly based on the level of vehicle ownership in each city, as well as our target market share.

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At a high level, for a city with vehicle ownership of 500,000, we believe it can support a Uxin superstore with around 1,000 units of inventory. Assuming 10%-15% of vehicle ownership is transacted as used cars annually, such a city would generate annual used car transactions of approximately 50,000-80,000 units. Based on the over 20% market share that our mature stores have already achieved, a Uxin superstore could achieve annual sales of over 10,000 units, which corresponds to an inventory level of around 1,000 units.

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Applying the framework today there are more than 30 cities in China with vehicle ownership exceeding three million, which can support super stores with over 5,000 units of inventory. There are more than 70 cities with vehicle ownership exceeding one million, which can support super stores with over 2,000 units of inventory. In addition, there are more than 100 cities with vehicle ownership exceeding 500,000, which can support super stores with over 1,000 units of inventory. In the long run, we believe there are more than 200 cities across China where we can potentially operate, supporting annual retail transaction volume of over three million units. Thank you. That was my answer.

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This concludes our question and answer session. I would like to turn the conference back over to management for any closing remarks.

Thank you all for participating on today's conference call. We look forward to reporting to you soon.

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.

Ladies and gentlemen, thank you for standing by, and welcome to Uxin's Earnings Conference Call for the quarter ended September 30, 2025. [Operator Instructions] Today's conference call is being recorded. I would now like to turn the call over to your host. Please go ahead.

Thank you, operator. Hello, everyone. Welcome to Uxin's earnings conference call for the third quarter ended September 30, 2025. On the call with me today, we have D.K., our Founder and CEO; and John Lin, our CFO. D.K. will review business operations and company highlights, followed by John, who will discuss financials and guidance. Before we proceed, I would like to remind you that this call may contain forward-looking statements, which are inherently subject to risks and uncertainties. Now with that, I'll turn the call over to our CEO, D.K. Please go ahead, sir.

[interpreted] Hello, everyone. In the third quarter of 2025, we continue to build strong growth momentum. Retail transaction volume reached 14,020 units, representing a 134% year-over-year increase and marking the sixth consecutive quarter of year-over-year growth above 130%. Despite a significant expansion in inventory, our inventory turnover remained at around 30 days. Customer satisfaction also remained at an industry-leading level; our Net Promoter Score (NPS) was 67 this quarter, sustaining a level of 65 or above for 6 consecutive quarters. At the same time, profitability continued to improve with gross margin increasing to 7.5%, the highest level we have achieved in the past 3 years. The expansion of our superstore network has also continued to progress. Earlier this week, our Jinan Superstore officially commenced operations. Together with the Wuhan and Zhengzhou Superstores that opened earlier this year, we have now completed all 3 new superstore openings planned for 2025. Our Wuhan Superstore is expected to reach nearly 1,800 retail units in December with a local market share approaching 10%. Meanwhile, our Zhengzhou Superstore is already expected to achieve approximately 900 retail units in December with market share nearing 5%. With these additions, we now have 5 superstores in operation. In addition, we have announced strategic partnerships with local governments in Tianjin, Guangzhou, and Yinchuan to jointly invest in and operate new superstores. Each project is designed to support a capacity of more than 3,000 vehicles. We plan to open 4 to 6 additional superstores in 2026, marking a transition into a phase of accelerated nationwide expansion. We believe Uxin has established a clear path to scaling, driven by more precise pricing, higher customer satisfaction, and superior operating efficiency. Our machine learning-based pricing system ensures each vehicle is competitively priced in real time, and our fully integrated factory-logistics-retail model enables end-to-end control. For the fourth quarter, we expect retail transaction volume to exceed 18,500 units, representing year-over-year growth of more than 110%. For the full year 2025, we expect to surpass 50,000 units, reflecting growth of more than 130%. With that, I'll turn the call over to our CFO, John.

[interpreted] Thank you, D.K. In the third quarter, retail revenue totaled RMB 820 million, up 84% year-over-year. The Average Selling Price (ASP) for retail vehicles was RMB 58,000, compared to RMB 59,000 in the prior quarter and RMB 74,000 in the same period last year. While ASP declined as we shifted toward a more affordable inventory mix, the strong growth in transaction volume more than offset this. We expect ASP to remain relatively steady in the near term. Turning to our wholesale business, transaction volume was 1,884 units, an 81% increase year-over-year. Total revenue for the quarter reached RMB 879 million, representing a 77% increase year-over-year. Gross margin for the quarter was 7.5%, up from 7% a year ago and 5.2% in the prior quarter. This improvement was primarily attributable to the easing of price competition in the new car segment and the Wuhan Superstore moving beyond its start-up phase. Adjusted EBITDA loss narrowed significantly to RMB 5.3 million, a 43% reduction year-over-year. Looking ahead to the fourth quarter of 2025, total revenue is expected to exceed RMB 1.15 billion. We are now ready to begin the Q&A session.

[interpreted] Congratulations on the 3-year high in gross margin. How does management view the sustainability of this level, and what factors could drive further improvement?

[interpreted] There are two main drivers: first, new car pricing has stabilized; second, the profitability of the Wuhan Superstore has improved significantly. Looking ahead, we believe there is still substantial room for expansion. Policies aimed at reducing excessive competition should keep prices stable. Additionally, our data-driven pricing capabilities are reducing errors and loss-making vehicles. Finally, value-added services have significant penetration upside. Our long-term target gross margin is around 10%, and our existing Xi'an and Hefei stores are already approaching this.

[interpreted] Following the opening of Zhengzhou, ramp-up seems faster than Wuhan. What initiatives drove this? Also, how long do you expect new superstores to take to reach stable operations?

[interpreted] Zhengzhou benefited directly from what we learned in Wuhan regarding construction, inventory build, and sales ramp-up. Furthermore, our larger pool of transaction data has improved our pricing capability. For a standard new superstore with a 3,000-vehicle capacity, we expect it to reach breakeven in about 9 months. We expect inventory to reach planned capacity in 18 to 24 months, at which point profitability should reach a mature level.

[interpreted] Carvana recently surpassed $100 billion in market cap. Could you comment on the similarities and differences between their model and Uxin’s?

[interpreted] The biggest difference is the sales channel; Carvana is online-only, while Uxin uses offline superstores for over 70% of sales. In China, cars represent a larger share of household assets, so consumers prefer in-store experiences and test drives. Similarities include the own-inventory model with self-operated reconditioning and a focus on precise pricing for high turnover. Carvana sells 500,000 units annually; we sell 50,000. We are confident we can reach Carvana's current volume within 4 to 5 years by sustaining over 100% year-over-year growth.

This concludes our question-and-answer session. I would like to turn the conference back over for any closing remarks.

Thank you all for participating. We look forward to reporting to you soon.

The conference has now concluded. Thank you for attending. You may now disconnect.

Ladies and gentlemen, thank you for standing by, and welcome to Uxin's Earnings Conference Call for the quarter ended September 30, 2025. [Operator Instructions] Today's conference call is being recorded. If you have any objections, you may disconnect at this time. I would now like to turn the call over to your host for today's conference call, Ms. [indiscernible]. Please go ahead.

Thank you, operator. Hello, everyone. Welcome to Uxin's earnings conference call for the third quarter ended September 30, 2025. On the call with me today, we have D.K., our Founder and CEO; and John Lin, our CFO. D.K. will review business operations and company highlights, followed by John, who will discuss financials and guidance. They will both be available to answer your questions during the Q&A session that follows. Before we proceed, I would like to remind you that this call may contain forward-looking statements, which are inherently subject to risks and uncertainties that may cause actual results to differ from our current expectations. For detailed discussions of the risks and uncertainties, please refer to our filings with the SEC. Now with that, I'll turn the call over to our CEO, D.K. Please go ahead, sir.

[interpreted] Hello, everyone, and thank you for joining Uxin's earnings conference call today. It is a pleasure to reconnect with our investors through this call, and we appreciate your continued interest and support. To better facilitate communication with both our domestic and international investors, I will be sharing our latest business updates in both Chinese and English. In the third quarter of 2025, we continue to build strong growth momentum. Retail transaction volume reached 14,020 units, representing a 134% year-over-year increase and marking the sixth consecutive quarter of year-over-year growth above 130%. Despite a significant expansion in inventory, our inventory turnover remained at around 30 days. Customer satisfaction also remained at an industry-leading level. Our Net Promoter Score was 67 this quarter, sustaining a level of 65 or above for 6 consecutive quarters, the highest in the industry. At the same time, profitability continued to improve with gross margin increasing to 7.5%, the highest level we have achieved in the past 3 years. The expansion of our superstore network has also continued to progress smoothly and in line with our plan. Earlier this week, our Jinan Superstore officially commenced operations. Together with the Wuhan and Zhengzhou Superstores that opened earlier this year, we have now completed all 3 new superstore openings planned for 2025. Our Wuhan Superstore, which opened in February, is expected to reach nearly 1,800 retail units in December with local market share approaching 10%. The store continues to operate in a phase of rapid growth. Meanwhile, our Zhengzhou Superstore, which opened in late September, has been operating for just 3 months and is already expected to achieve approximately 900 retail units in December with market share nearing 5%. Zhengzhou has already become the largest used car retailer in its local market, and both its sales ramp-up and profitability trajectory are progressing faster than what we experienced at the Wuhan Superstore. With these additions, we now have 5 superstores in operation. The continued ramp-up of newly opened locations, together with sustained growth across our existing stores will remain a key driver of the company's performance going forward. In addition, over the past few months, we have announced strategic partnerships with local governments in Tianjin, Guangzhou and Yinchuan to jointly invest in and operate new used car superstores. Each of these projects is designed to support a capacity of more than 3,000 vehicles for display and sale. These partnerships extend our service coverage across Northern, Northwestern and Southern China, further strengthening the foundation for our long-term growth. Meanwhile, we are actively advancing superstore projects in several other cities, and we plan to open 4 to 6 additional superstores in 2026, marking a transition into a phase of accelerated nationwide expansion for our business. By now, we believe that Uxin has established a clear and proven path to scaling its business model nationwide, driven by the coordinated execution of 3 core capabilities that are more precise pricing, higher customer satisfaction and superior operating efficiency. First, our machine learning-based pricing system becomes increasingly effective as our retail scale expands. With a growing base of real transaction data used to train our models, pricing accuracy continues to improve. ensuring that each vehicle is competitively priced in real time. This allows us to maintain high inventory turnover of around 30 days. Second, our landmark large-scale superstores play a critical role in enhancing the customer experience. By offering high-quality, competitively priced vehicles supported by professional and reliable services, we are able to consistently improve customer satisfaction and referral rates, creating a self-reinforcing cycle of brand trust and organic growth. Third, our fully integrated factory logistics retail operating model enables end-to-end control across procurement, reconditioning and retail sales. This model delivers operational efficiency that significantly outperforms traditional used car dealers while remaining highly standardized and replicable. As a result, new superstores reached maturity faster and losses during the early ramp-up phase are more predictable and better controlled. Going forward, as long as the market conditions remain stable, we are highly confident in the sustained and rapid growth of our business. As such, for the fourth quarter, we expect our retail transaction volume to exceed 18,500 units, representing a year-over-year growth of more than 110%. For the full year 2025, we expect retail transaction volume to surpass 50,000 units, reflecting year-over-year growth of more than 130%. With that, I'll turn the call over to our CFO to walk you through the financial results. John, please.

Okay. Thank you, D.K. [interpreted] Hello, everyone. I will continue to present the company's performance in both Chinese and English to better communicate with all of you. In the third quarter, our retail transaction volume reached 14,020 units, representing a 134% increase year-over-year and a 35% increase quarter-over-quarter. Sales at our existing superstores continues to grow, whilst new superstores have come into operation progressively. Looking ahead, we expect our retail transaction volume to maintain a high growth trajectory over the next several years. Retail revenue for the quarter totaled RMB 820 million, up 84% year-over-year and 35% quarter-over-quarter. The average selling price or ASP for retail vehicles was RMB 58,000 compared to RMB 59,000 in the prior quarter and RMB 74,000 in the same period last year. While ASP declined as we shifted toward a more affordable inventory mix, the strong growth in transaction volume more than offset the pricing impact and drove our overall revenue expansion. Our current inventory structure is well aligned with mainstream consumer demand, and we believe pricing has now stabilized at a rational level. As such, we expect ASP to remain relatively steady in the near term. Turning to our wholesale business. Our wholesale transaction volume was 1,884 units in the third quarter, representing an 81% increase year-over-year and a 54% increase quarter-over-quarter. Total wholesale revenue was RMB 33.2 million. Combining both retail and wholesale, total revenue for the quarter reached RMB 879 million, representing a 77% increase year-over-year and a 34% increase quarter-over-quarter. Gross margin for the quarter was 7.5%, up 0.5 percentage points from 7% a year ago and up 2.3 percentage points from 5.2% in the prior quarter, marking the highest level over the past 3 years. The improvement was primarily attributable to the easing of the price competition in the new car segment during the third quarter, which supported a rapid margin recovery in the used car market. In addition, our Wuhan Superstore, which opened in February, has moved beyond its start-up phase with margin performance continuing to ramp up and driving a meaningful lift to this quarter's gross margin. Adjusted EBITDA loss for the quarter narrowed significantly to RMB 5.3 million, representing a substantial 43% reduction year-over-year and a 68% reduction quarter-over-quarter. Looking ahead to the fourth quarter of 2025, we expect retail transaction volume to exceed 18,500 units, representing year-over-year growth of over 110%. Total revenue is expected to exceed RMB 1.15 billion. For the full year 2025, we expect retail transaction volume to exceed 50,000 units, representing year-over-year growth of over 130%. That concludes our prepared remarks for today. Thank you, everyone. Operator, we're now ready to begin the Q&A session.

[Operator Instructions] The first question today comes from Wenjie Dai with SWS Research.

[interpreted] Congratulation and now we see gross margin reached 7.5% this quarter, 3 years high. How does management view the sustainability of the current margin level? And what factors could further drive margin improvement going forward?

[interpreted] This quarter's gross margin was 7.5%, representing a new high since we transitioned to the self-operated model, and there are 2 main drivers behind this improvement. First, new car pricing has stabilized, which naturally supports a recovery in used car profitability. At our existing Xi'an and Hefei Superstores, gross margin exceeded 8%, up nearly 2 percentage points sequentially. Second, profitability at our new Wuhan Superstore has also been improving. Our Wuhan Superstore officially opened in February and started from the third quarter, its gross margin has improved significantly compared with the early operation phase in the second quarter. Looking ahead, we believe there is still substantial room for further margin expansion. First, as China continues to implement policies aimed at reducing excessive competition in the auto industry, we expect vehicle prices to remain stable or even trend upward over the coming quarters, which would be supportive for our margins. Second, as D.K. just mentioned, our data-driven pricing capabilities continue to improve. Pricing errors are becoming less frequent and the proportion of loss-making vehicles is declining. Finally, our value-added services still have significant penetration upside as higher-margin ancillary revenue contributes more meaningfully to our revenue mix. This will further lift our gross margin. Over the long term, our target gross margin is around 10%. At our existing Xi'an and Hefei superstores, we are already seeing gross margin approaching this target, which gives us strong confidence in continued margin expansion. That's my answer. Thank you.

The next question comes from Fei Dai with TF Securities.

[interpreted] My first question is following the opening of the Zhengzhou Superstore, both sales and profitability ramp up seems to be faster than what we saw in Wuhan. Could management share what key initiatives drove this outperformance? And looking ahead, how long do you expect the newly opened superstores to take to reach stable operations?

[interpreted] Thank you for your question. Our Zhengzhou Superstore has only been operating for about 3 months and monthly sales have already reached 900 units. Its profitability is also higher than what we saw at the same stage for the Wuhan Superstore. On the one hand, our Wuhan Superstore can be viewed as the first large-scale replication of our superstore model and is already performing meaningfully better than our Xi'an and Hefei superstores. Zhengzhou, in turn, benefited directly from what we learned in Wuhan from construction and launch to inventory build and sales ramp-up. So our organization and operating systems are running more smoothly. On the other hand, as our sales volume expands, we now have a much larger pool of real transaction data to train our pricing system. This has further improved our pricing capability. The pricing system has adapted more effectively to the Zhengzhou market with more precise pricing, which helps ensure sales efficiency and support stronger profitability in the early stages of operation. Standard new superstore with a planned capacity of approximately 3,000 vehicles, our current expectation is that it reaches breakeven in about 9 months. This is consistent with what we achieved at the Wuhan Superstore. We expect inventory to reach its planned capacity in about 18 to 24 months, at which point both sales volume and profitability should reach a mature and stable level. That's my answer. Thank you.

[interpreted] My second question is U.S. used car company, Carvana recently surpassed $100 billion market cap. Could management comment on the key similarities and difference between Carvana's model and Uxin's?

[interpreted] Carvana is a leading used car company in the U.S. and has delivered very strong capital market performance. We have conducted in-depth research on Carvana. Starting with the differences, the biggest distinction is the sales channel. Carvana sells online, while Uxin operates through both offline superstores and then online marketplace. Currently, over 70% of our sales come from offline superstores with online contributing roughly 30%. This mainly reflects the different market realities in China and the U.S. At this stage in China, a car typically represents a larger share of the household assets, so people make purchase decisions more cautiously. As a result, many consumers still want an in-store experience and a test driver before buying a used car. Over time, as auto consumption continues to develop and trust in the used car market keeps improving, we do expect the online share to increase as well. That said, we share many similarities. First, both companies operate under an own inventory model with large-scale reconditioning through self-operated facilities and tight control over every step of the process to reduce per unit cost and improve inventory turnover efficiency. Second, given that used cars are a highly nonstandardized product, both Carvana and Uxin focused on precise pricing to ensure efficient vehicle turnover. Carvana's annual retail volume is around 500,000 units, while Uxin currently sells about 50,000 units per year. These real transactions form the most critical training data for pricing models. As our retail scale continues to expand, we expect our pricing capabilities to further strengthen. Third, both companies prioritize customer satisfaction and brand reputation. Carvana's NPS is above 80, and our NPS reached 67 this quarter and has remained at the highest level in the industry for more than a dozen consecutive quarters. Strong word of mouth reflects the value we deliver to customers and also drives incremental referral traffic. Today, Uxin is a used car company with annual retail volume of approximately 50,000 units. We are highly confident that by continuing along our current development path, we can sustain year-over-year sales growth of more than 100% over the next several years and reach Carvana's current sales volume within 4 to 5 years. That's all I wanted to share. Thank you.

This concludes our question-and-answer session. I would like to turn the conference back over for any closing remarks.

Thank you all for participating on today's call. We are looking forward to reporting to you soon.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect. [Portions of this transcript that are marked [interpreted] were spoken by an interpreter present on the live call.]