Atour Lifestyle Holdings Ltd (ATAT) Q2 2026 Earnings Call Transcript

Ladies and gentlemen, thank you for standing by and welcome to the Ator Lifestyle Holdings second quarter, 2026 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a Q&A session. Today's conference is being recorded. I would now like to turn the conference over to Mr. Luke Hu, IR Director.

Please go ahead, sir. thank you operator good morning and good evening everyone welcome to our second quarter 2026 earnings conference call today you will hear from our founder chairman and the CEO mr. Wang haijun and our EVP co-safo mr. Wu Jianfeng before we continue please be aware that today's discussion will include forward-looking statements and the federal securities laws these statements are subject to various risks and uncertainties and the actual results may differ significantly from what is stated or implied in our comments today. The company is not obligated to update any forward-looking statements except as required by applicable laws. Additionally, during this call, our management will discuss certain non-gap financial measures solely for comparison purpose For a clear understanding of these measures and a reconciliation of GAAP to non-GAAP financial results, please refer to the earnings release issued earlier today. Furthermore, a webcast replay of this conference call will be accessible on our website at ir.yaduo.com, where a copy of the results presentation is also available. Now, I will turn the call over to Mr. Wang, our CEO.

Thank you, Luke. Hello, everyone.

Thank you for joining a tour's second quarter 2026 earnings call today. 请大家打开我们的PPT 回顾2026年上半年中国消费市场延续结构性分化的态势 无论是在酒店还是零售行业 我们都能感受到明显的温差 同质化的产品和服务表现持续的承压 而具备体验优势和品牌价值的企业则展现出更强的韧性 具体来看 酒店行业正在经历从规模扩张向高质量发展的转变 竞争重点逐步从单纯的供给增长 转向产品创新 服务能力和经营效率 零售市场中 消费者在关注产品品质的同时 也越来越重视产品是否契合自身生活方式 对个性化的需求日益凸显 这意味着在新的消费趋势下 长期坚持品质投入 持续打造差异化体验的品牌 才更有机会赢得消费者的认可 上半年 我们坚定推进中国体验品牌领航的新三年战略 围绕酒店和零售两大核心业务不断突破 巩固体验优势 提升品牌赤能 推动业务长期健康可持续发展 Please turn to our results presentation.

In the first half of 2026, China's consumer market continued to show diverging performance. In both the hotel and retail sectors, we saw a clear split. Homogeneous products and services remained under pressure, while companies that deliver differentiated experiences and have strong brand equity showed greater resilience. More specifically, the hotel industry is shifting from scale-driven expansion to high-quality growth. Competition is increasingly centered on product innovation, service capabilities, and operational efficiency rather than supply growth. In retail, consumers are not only pursuing product quality, but are also placing increasing importance on whether products align with their lifestyles and the demand for personalization is also growing. This means that under these new consumer trends, brands that consistently invest in quality and build differentiated experiences are better positioned to earn consumer recognition. In the first half, we firmly advanced our new three-year strategy, Chinese Experience, Brand-Led Excellence, making continuous breakthroughs across hotel and retail businesses. We also consolidated our experience advantage and enhanced brand momentum, driving long-term healthy and sustainable growth.

Now, I would like to provide more details on our business performance for the second quarter of 2026. 其中ADR保持稳健增长为25年同期的101.2%, OCC为25年同期的99.7%,二季度再营超过18个月的成熟酒店ROARPA是336.8元,为25年同期的97%,其中ADR和OCC分别为25年同期的98.3%和99%

Let's begin with our hotel business. In the second quarter, our REF-PAR was RMB 345.4, representing 100.7% of the level in the same period of 2025. ADR maintained steady growth, reaching 101.2% of its level in the same period of 2025, while OCC stood at 99.7%. Rough part for our mature hotels in operation for more than 18 months was R&B 336.8, representing 97% of the level in the same period of 2025.

ADR and LCC were 98.3% and 99% of their respective levels in the same period of 2025. 酒店网络方面 我们坚持品质优先的原则 严格把控项目筛选和开业标准 二季度集团共计新开业101家酒店 产品力和区位优势叠加释放 推动了核心区域的布点质量持续提升 截止二季度末集团再营酒店数量达到2175家 同期管道数量是811家 项目储备保持在健康水平 As for our hotel network, we continued to follow a quality first principle and maintain

strict standards for project selection and new hotel openings. In the second quarter, we opened 101 new hotels. Product strengths and prime locations together enhanced the quality of our hotel presence in core markets. By the end of the second quarter, our total number of hotels in operation reached 2,175, and our pipeline of hotels under development remained at a healthy level of 811. On the hotel channel front, our CRS channel continued its steady performance in the second quarter, accounting for 61.5% of total room nights sold. The contribution of room nights sold to corporate members was 20.4%.

Next, I will show you the latest development of the hotel brands. Next, I would like to share the latest developments across our hotel brands. 中高端市场是亚朵长期深耕的主阵地 经过多年积累 我们已经建立了明确的领先地位 回溯发展历程 亚朵酒店早期给用户的印象 是一个聚焦中高端商旅需求的生活方式酒店品牌 而随着消费趋势和用户需求的演变 我们持续推动产品迭代升级 最新一代的亚朵3.6版本 The upper-mid-scale segment has long been a towards core focus.

over the years we have established a clear leadership position looking back at our development at our hotel was initially perceived by users as a lifestyle brand catering to the needs of upper mid-scale business travelers as consumer trends and user needs evolved we continued to upgrade our products with disciplined investment the latest at tour 3.6 strikes a balance between the experience it delivers and investment returns. It preserves its strength in business travel while introducing a greater sense of ease. Atura 3.6 again delivered outstanding performance in the second quarter, with rough part of hotels in operation exceeding RMB 370, further validating market recognition of the product upgrade. 持续拓展中高端酒店市场的增长空间 截至目前亚朵剑野再营酒店数量超过60家 管道内储备项目超过90家 亚朵剑野在提供更具辨识度体验的同时 也具备更强的溢价能力 在二季度亚朵剑野再营酒店的Rower Park超过450元 体现出极强的差异化的竞争力 Within our upper mid-scale brand portfolio Atour Origin and Atour Hotel are developing in parallel, further expanding our growth potential in the segment. To date, more than 60 Atour Origin hotels are in operation, with over 90 projects in the pipeline. Atour Origin offers a more distinctive experience and commands stronger pricing power. In the second quarter, Ravpar of a tour origin hotels in operation exceeded RMB 450, highlighting its strong differentiated competitive edge. A tour origin is designed to reflect the Yaduo village as it truly is, natural, tranquil, warm, and authentic. In April, we wrote out a series of distinctive experience touch points across a tour origin hotels nationwide. Upon arrival, guests are welcomed by a wilderness-inspired signature scent. In the afternoon, they can enjoy the tea break in the chatting room. At night, they enjoy our deep sleep experience. And in the morning, they are served a breakfast featuring local Yunnan flavors. Through this more complete experience, we want guests to feel closer to nature, feel like they're on vacation and to rediscover their inner peace. In the mid-scale market, differentiation ultimately rests on a stay experience that customers can truly feel. This has long been a tour light focus. After continued refinement, the Auteur Lite 3.3 cost model has entered a new phase of systematic optimization and scaled road-out. We are concentrating resources more precisely on the core experience areas that customers care about, including sleep and breakfast. Auteur Lite 3.3 not only provides customers with a more comfortable and relaxing stay, but also improves franchisees' operating efficiency through a more disciplined investment model. In the second quarter, Ravpar of Batua Lite 3.3 hotels in operation exceeded RMB 340, demonstrating strong operational resilience. Atour Light has established a more flagship projects in higher-tier cities, which have received positive feedback from franchisees while the Brent Foundation continues to strengthen. At this stage, Atour Light will continue to take a quality-first approach. As we strengthen our operating capabilities, we will steadily expand Atour Light's city coverage and continue to drive product and experience innovation in the mid-scale hotel market. Meanwhile, we are deepening a tour light connection with younger customers. In the second quarter, we introduced exclusive benefits for students and launched the distinctive brand collaborations over the summer, further raising brand awareness among younger consumers.

From the release of the product developed around the launch of a large brand of product industry, since the release of the product has been attained, it also is all about preserving the value of the value of a market, and it has been completed by a upcoming traditional live quality, at a second, the sales performance is still being continued, the also being in our hotel app is 1,000 thousand.

Drawing from the vital essence of breath, SAH is devoted to creating serene spaces in the city, where guests can breathe freely and feel truly at peace. Sa-He has played a role in driving the upward breakthrough of a tour's brand portfolio since its launch. It has advanced our brand philosophy and continues to broaden the value it delivers, setting a new standard for upscale lifestyle. In the second quarter, Sa-He's operating performance reached a new high, with RevPol of hotels in operation exceeding RMB 1,000. On the operation side, we continue to enhance SAHO's refined management capabilities, gradually developing a replicable experience methodology with a global perspective that covers brand standards, service systems, and talent training. In the second quarter, we also expanded Saha's wellness offerings with a broader selection of classes and dining options.

Our goal is to provide guests with an even more exceptional experience throughout their stay. 接下来是我们的零售业务 二季度亚朵星球延续了强劲的增长市场 零售收入达到15.75亿元 同比增长63% 从品类结构来看 我们逐步从单一大单品的驱动模式 向更加丰富的产品矩阵发展 分品类来看 亚朵星球持续巩固在枕头品类断层领先的优势 深睡人pro系列自推出以来 累计销量已经超过1200万只 同时深睡控温贝夏季pro3.0持续热销 也带动被子品类实现快速增长 二季度被子品类的GMV同比增长超过80%

此外,去年推出的战略的新品类,床利和税衣,也持续取得亮眼的销售表现,收入占比进一步提升 Moving on to our retail business In the second quarter, Atual Planet sustained its strong growth momentum with retail revenue reaching RMB 1.575.000.000, up 63% year over year In terms of Calgary mix, we are gradually shifting from a single blockbuster product model to a broader product portfolio. By product Calgary, Atura Planet further consolidated its dominant position in the pillow category with cumulative sales of the Deep Sleep Memory Foam Pillow Pro Series surpassing 12 million units since launch. The deep sleep thermoregulating Comforter Pro 3.0 summer season continued to see strong sales, driving rapid growth in the Comforter category. GMV of the Comforter category increased by more than 80% year-over-year.

Fitted sheets and launchwear, two strategic categories we introduced the last year, maintained outstanding sales momentum and contributed a larger share of revenue. 从长期来看 零售业务持续突破的背后 是我们围绕品牌 产品 供应链和内容创意建立的系统性的能力 以及由此形成的坚实壁垒 首先 在品牌能力上 经过多年的积累 亚朵星球自然深睡的品牌心智深入人心 用户对亚朵睡眠产品的信任也在持续增强 第二 产品研发能力上 我们始终围绕用户真实的睡眠需求 进行产品创新 通过持续跌旦 建立了从单品突破到品类延展的研发能力 逐步完善了睡眠产品的矩阵 第三 供应链能力上 我们重塑了行业的供应链体系 多项工艺精度突破了行业原有的标准 建立了从原材料到成品 全链路的品质管控体系 产品一致性和可靠交付的能力达到了行业领先的水平 创意和用户连接的能力上 我们的策略始终是精准传递产品的价值 通过场景化体验化的内容表达 让用户能够更直观的感知深邃 进一步深化品牌和用户之间的情感连接 Over the long term, the continued breakthroughs in our retail businesses are backed by systematic capabilities built across our brands, products, supply chain, and content creation.

Together, they form a strong competitive moat. First, in brand building, Atura Planet has firmly established natural deep sleep in users' minds over the years, while users' trust in our sleep products continues to grow. Second, in product development, we have always innovated to address users' genuine sleep needs. Through continuous iteration, we have built R&D capabilities that deliver breakthroughs in individual products and support expansion into new categories. This has enabled us to steadily broaden our sleep product portfolio. Third, in supply chain capabilities, we have reshaped the industry's supply chain system and set new industry standards for position across multiple manufacturing processes. We have also established end-to-end quality control from raw materials to finish the products with industry leading product consistency and delivery reliability. Fourth, we have strong capabilities in content creation and user engagement. Our strategy has always been to communicate product value with clarity and precision. By creating content around real sleep scenarios and experiences, we make deep sleep more tangible and deepen the emotional connection between our brand and our users.

In the system-powered power of the power of the system, we have also released the Thank you very much.

Building on these capabilities, we recently launched upgraded products in our core categories, including the Deep Sleep Memory Foam Pillow Pro 4.0 and the Deep Sleep Thermoregulating Comforter Pro 3.0 all season. Both new products are built on the Atoa Planet Deep Sleep standard we introduced last year. Through this standard, we aim to translate users' experience of sleeping well into product standards that are more scientific, verifiable, and continuously refinable. Guided by this approach, the Deep Sleep Memory Phone Pillow Pro 4.0 addresses a real pain point of frequent position changes during sleep. With an upgraded dynamic support system, it provides better support across every sleeping position. The Deep Sleep Thermoregulating Comforter Pro 3.0 all season also addresses the need for sleep comfort under changing temperature and humidity conditions. Its temperature and humidity balancing system improves temperature regulation and moisture management, allowing it to flexibly adapt to seasonal temperatures, winds, and changes in how warm or cool users feel throughout the night. Looking ahead, we will continue developing our retail business with a long-term mindset. Guided by user needs, we will continue to innovate and evolve our product portfolio. further increase our market share in core categories and consolidate our leadership. We will also continue strengthening Atoor Planet's brand value by translating our strengths in product development and technology into a lasting competitive mode for the brand. We will consolidate Atoor Planet's position as the sleep brand that users choose first and consistently trust. Turning to membership, by the end of the second quarter, a tour had 120 million registered individual members. As our membership base has grown, the strategic growth of our membership ecosystem has become It is not only a solid foundation for our hotel and retail businesses, but also a platform for retaining long-term users and cultivating user value. at the same time we are building a more refined system for engaging different user groups by focusing on their core needs we deliver more relevant benefits and experiences through segmented engagement and targeted outreach we aim to deepen our connection with users and build longer lasting relationships with them throughout the user life cycle

最后我想和大家分享一些思考 近期我们推出了亚朵安心六大承诺 围绕用户入住全流程中的核心环节 进一步明确服务标准和保障措施 我们认为安心不是一句口号 而是用户在每一次入住中都能够清晰感知稳定获得的体验 通过把这些体验做得更扎实 我们希望让安心真正沉淀为 I would like to share a few thoughts.

Recently, we introduced a tour's six commitments to peace of mind, which further clarify our service standards and safeguards across key touch points of the guest journey. We believe peace of mind is not just a slogan. It should be an experience that guests can clearly feel and consistently enjoy during every stay. By delivering these experiences more reliably, we aim to make peace of mind an integral part of how people perceive the Atore brand.

We also hope to set a new benchmark for service standard across the industry. 客房从业人员的公益项目 改善一线岗位服务者的工作环境 以及通过服务者结等行动向他们表达尊重和感谢 我们始终相信只有当服务者被看见被尊重被善待 他们的善意和温软才会更自然的传递给用户 形成用户和品牌之间长期的信任连接 我们希望持续作为优秀服务的

behind every experience that gives guests peace of mind is the dedication of our service staff we continue to pay close attention to their development and enhance their experience at work including launching a public welcome program for hotel housekeeping professionals nationwide improving the work environment for frontline service staff and expressing respect and gratitude to them through initiatives such as Service Staff Appreciation Day. We firmly believe that when service staff are seen, respected, and treated with care, their kindness and warmth will reach guests naturally. This creates lasting trust between our brand and our users. With that in mind, we hope to continue advocating for service excellence and leading the industry toward a higher standard of experience. These actions are grounded in a tour's long-term commitment. Across both our hotel and retail businesses, we have always believed that quality is the foundation of sustainable long-term growth. By improving product quality, refining the user experience, and strengthening organization capabilities, we can keep creating value for users and build competitive strength that endures through the industry cycles. Looking ahead, we will continue to do the right things with warmth. With user experience at the center and organizational capabilities as the foundation, we will carry that warmth through every experience we deliver. This enduring warmth will define a tour as we navigate industry cycles and build for the long term.

Next, I will now turn the call over to our co-CFO, Mr. Wu Jianfeng, who will discuss our financial results. Thank you, Haijun. To present the company's financial performance was 41.419 million. The total number of our leased hotels decreased from 24 as of June 30, 2025 to 19 as of June 30, 2025. Revenues for our retail business for the second quarter of 2026 in probably $1,575 million. The growth was driven by increasing brand recognition, successful product innovation, and a broadened range of product offerings. Gross profit of our hotel businesses for the second quarter of 2026 is by 18.7% year-over-year to RMB 659 million. The decline in the gross margin primarily reflected a shift in the revenue mix as our lower margin supply chain business grew faster and accounted for a larger share of hotel revenue. Profit of our retail business for the second quarter of 2026 increased by 57.4% year-over-year to RMB 809 million. The decrease in gross margin primarily reflected a shift in the product mix. Setting and marketing expenses accounted for 17.4% of net revenues for the second quarter of 2026, compared with 15.9% for the same period of 2025. The increase was primarily due to the investment in brand recognition and the effective development of online channels in line with the growth of our retail business. A GNA expenses, extruding share-based compensation expenses accounted for 3.5% of net revenue for the second quarter of 2026, compared with 3.6% for the same period of 2025. Technology and development expenses accounted for 1.6 percent of net revenues for the second quarter of 2026 compared with 1.7 for the same period of 2025. Adjusted net profit margin for the second quarter of 2026 was 16.0 percent, representing a decrease of 1.3 percentage points year-over-year. Adjusted EBITDA margin for the second quarter of 2026 was 23.5 percent, decreased by 1.2 percentage points year-over-year. We maintain a healthy cash position as of June 30, 2026. Cash and cash equivalents totaled RMB 3.9 billion with net cash of RMB 3.7 billion. That concludes our financial highlights for the second quarter of 2026. And for the full year of 2026, we currently expect total net revenue to increase by 30% compared with the full year of 2026. Now let's open the door for Q&A.

Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. For the benefit of all participants on today's call, if you raise your question in Chinese, please immediately repeat your question in English. Please limit your question to one at a time. If you wish to have a follow-up question, please rejoin the queue.

Please stand by as we compile the Q&A roster.

First question comes from Dan Chi from Morgan Stanley. 各位管理层, 大家晚上好, 我是大摩的Dan. 非常感谢这次提问的机会. 我想问一下这个 关于今年整个酒店这边的 签约和开店的情况. 就是今年以来 我们看到行业的整体的供给会有所降速 会影响公司这边的开店和签约的情况 我们看到这个pipeline 取位店也稳定的增长 另外还想问一下 就是关于公司全年的开店 还有关店的指引 是否跟之前一样 有没有一些调整 Please allow me to translate my question This is Dan from Morgan Stanley my question is about hotel opening and signing so since the beginning of this year are the overall industry supply was seen deceleration so where this affect the company's upcoming signing interest and additionally we would like to ask if the company is keeping or any adjustment to the guidance of full year hotel gross opening and closure thank you Thank you.

At the time of the market, we are more interested in the company's growth and the long-term growth and the long-term growth and the long-term growth of the company's growth. The company is leading to the company's growth, the product model is成熟, and the investment is stable. I think it is the company's growth in the company's growth.

Thank you, Dan. There are multiple factors behind the supply dynamics in the hotel industry, including macro economic environment, supply demand relationship, and property availability. they all lead to cyclical fluctuations. So this is a natural adjustment process as the industry matures. Rather than focusing solely on overall supply volume, we place greater emphasis on truly competitive, the high-quality supply that meets consumers' quality expectations. In the current market environment, franchisees are more focused on a brand's ability to sustain growth and its long-term resilience through market cycles. The leading brands with superior customer experiences, strong brand equity, and proven product models, and stable investment returns remain as their top choice for those franchisees when making their investment decisions. We believe that the industry adjustment period is precisely a critical phase for leading brands to further consolidate their strength and increasing their market share. We are not pursuing scale expansion alone. our core goal is to build sustainable brands and strong brand equity across all tiers and on the foundation of steadily enhancing brand strengths we are expanding our brand presence currently our brand portfolio already cover a broader range of price points and consumption scenarios capable of accommodating diverse property conditions and meeting more varied market demand. In terms of project distribution, we center around user needs and a long-term brand value, with higher tier city core business districts still remaining as our primary focus. At the same time, we are actively expanding into strong third-tier cities, areas surrounding the 5A-rated scenic spots and distinctive property opportunities arising from urban renewal projects as supplement. In the first half of the year, our signing momentum remained a steady trend, and the pipeline achieved solid increase quarter-over-quarter, providing a high-quality reserve for future hotel openings. Thus, we maintain our full-year opening target unchanged. In addition, the overall pace of closures has slowed significantly on a sequential basis since the second quarter. Therefore, we are also keeping our full-year guidance of approximately 80 hotel closures unchanged. Thank you.

Next question, please.

Thank you. Just a moment for our next question, please. Next, I have Ronald Leung from Bank of America.

Hello, everyone. Hello, everyone. I'm Ronald Leung. Let me translate my question into English. So, we have observed a relatively volatile RAFPA trend since Q2. Could management share your view on RAFPA performance in the second half of the year?

Thank you Ronald, and let me address this question. We believe that the long-term demand in the quality accommodation market continues to rise, But whether for business travel or leisure tourism, this fundamental logic has not changed. In the short term, due to weather factors such as typhoons and heavy rainfall in some regions during early July. The travel pace during this summer season was slightly delayed compared to previous years. But since the end of July, with the arrival of peak season, summer travel demand has shown signs of stabilizing and picking up. Over the longer term, demand resilience remains intact, and the industry's trend toward higher quality development is clear. In this process, companies with strong brand equity and a solid customer base will continue to capture structural opportunities. We, therefore, hope the market can look beyond short-term data points and focus more on the positive adjustment trends within the industry and the ability of leading brands to withstand cycles. Thank you. Next question, please.

Thank you. Next question comes from Ji-Win Liu from Citi.

Please go ahead. 管理层好,我是中信证券的刘纪伟,我这边有一个关于需求的问题,想请教一下管理层对现在的这个酒店的需求结构是怎么看的,以及像商务和休闲两端是不是有出现一些新的变化或者机会。 I translate my question to Jiwei from CITICS. I would like to ask the management how you view the current demand structure. Are there any new changes or opportunities in business and near travel respectively? Thank you.

Thank you, Jiwei. First of all, in the business demand demand structure. We see that in the past, the K-A business demand is important.

Thank you, Jiwei. First, with business demand, the customer base is becoming more diversified. Before, larger KA enterprise clients were a major source of demand. However, as the market landscape evolves, we're now also seeing new opportunities emerging from local core enterprises, universities, and research institutions. Therefore, while we continue to serve our core corporate clients well, we are also enhancing our business travel system to tap into new resources of business travelers, thereby strengthening both our demand coverage and the stability of our customer structure. In addition, on the leisure travel demand side, more and more consumers are paying greater attention to the experiential value of their stay beyond simply fulfilling functional accommodation needs. This aligns well with Atour's direction of pursuing high quality and multi-brand development. Through differentiated positioning, our brand portfolio is able to more precisely match the needs of different customer segments and the consumption scenarios. At the same time, inbound tourism is also a key growth market that we have been focusing on over the long term with the gradual recovery of the inbound tourism market we are actively advancing cooperation with overseas distribution channels and brand communications and capture the long-term opportunities brought by the growth of the international guests in the future thank you next question please thank you next we have Lydia Ling from Citi please go ahead

管理层好,我是花旗的Lydia。 business, and we continue to see very strong momentum for the retail business in the second quarter. And so what would be the, like, the core reason behind the distress? And given the strong growth in the first half, what's your latest guidance for your retail business for the full year? Thank you.

Thank you, Lydia. Let me answer the first part of your question. In the first half of this year, a tour plan has continued to maintain relatively fast growth. However, for us, growth itself is merely an external reflection of the building of our capabilities. What matters more is the continuous accumulation and improvement of our systematic capabilities across brand, product, supply chain, content, and other areas. A tour planet has never chased the short-term trends or run discount promotions. Instead, we focus on product innovation and brand building around users' real sleep needs. We believe that products that truly create user value and deliver consistent quality will ultimately earn long-term recognition from the users.

The new strategy is also becoming the key component of the sleep environment.

On the product side, as the business developed, we have gradually built a more comprehensive sleep product portfolio. While our pillow category continues to maintain its leading edge, our comforters also achieved rapid growth. New categories extending from the sleep scenario such as fitted sheets and the launchware are also becoming important growth drivers. Regarding the full-year revenue guidance for the retail business, based on the strong performance in the first half of the year and the solid sales momentum following new product launches, we are raising our full-year retail revenue growth guidance to 40% year-over-year. Next question, please.

Thank you. Last question comes from Xing Chen from UBS. Please go ahead.

Thank you for the opportunity for this question. I am UBS. My question is not in the financial issue. 此前公司提到了全年费率会有所提升,想请教一下现金段对全年利用率的指引是否有变化,另外想问一下公司在股东回报方面有什么样的变化。 And let me translate to English. This is Xunxing from BVF. I'd like to ask questions about financial. Previously, the company indicated the full-year expense ratio would increase. Could you please elaborate on whether there has been any change to the full-year profit margin guidance at this stage? Second question is about shareholder return. Has there been any change to the company's shareholder return Thank you, Chen Xin.

Let me address this question. Currently, we still maintain our initial judgment from the beginning of the year that the full year net profit margin will see a slight year-on-year decline. However, we observed some shifts in the factors affecting our profit margin. At the beginning of the year, we anticipated that increased investment in talent expansion and the technology R&D aimed at supporting long-term capability building would drive up our G&A and R&D expense ratios and exert some pressure on net margin. But based on our actual first half performance, a positive development has emerged. Revenue growth exceeded our initial expectations. So while we continue to invest in capability building, the expense growth has remained broadly aligned with revenue growth. As a result, we now expect the G&A and R&D expense ratios to stay relatively stable. As the full-year revenue growth for both our hotel supply chain business and retail business is expected to exceed our initial estimates, driving a shift in the group's revenue mix. In addition, as we continue to execute our shareholder return program, the group's effective tax rate is also expected to rise compared to last year, which will have a certain impact on net margin. Considering both the revenue mix shift and the higher tax rate, we anticipate a modest year-over-year decline in the group's full-year net profit margin. And as in terms of shareholder returns, we have consistently executed it in accordance with our established strategy and pace. Since the initiation of the share repurchase program up to the end of the second quarter, the cumulative repurchase amount has exceeded 150 million U.S. dollars. In terms of dividends, we are also continuing to steadily implement our existing dividend policy. Thank you.

Thank you. That concludes today's Q&A. session. I would now like to turn the conference back to Mr. Luke for any additional or closing comments.

Thank you for joining us today. If you have any further questions please feel free to contact our IR team. We look forward to speaking with you again next quarter. Thank you and goodbye.