Luckin Coffee Inc. (LKNCY) Q2 2026 Earnings Call Transcript

Ladies and gentlemen, welcome to Luckin Coffee's Second Quarter 2026 Earnings Conference Call. All participants will be in a listen-only mode during management's prepared remarks, and there will be a question-and-answer session to follow. Please be advised that today's call is being recorded. Now I'd like to turn the call over to Ms. Nancy Song, Head of Investor Relations for Luckin Coffee. Nancy, please go ahead.

Thank you, and hello everyone. Welcome to Locking Coffee's second quarter 2026 earnings conference call. We announced our financial results earlier today before the U.S. market opens. The earnings release is now available on our IR website and the Vibesware services. Today, you will hear from Dr. Guo Jingyi, co-founder and CEO of Locking Coffee, who will share a strategic overview of our business. Then Ms. Anjing, our CFO, will discuss our financial results in greater detail. Afterwards, we will open up the call for questions. During today's call, we will be making some forward-looking statements regarding future events and expectations. Any statements that are not historical facts, including but not limited to statements about our beliefs and expectations are forward-looking statements. These statements involve inherent risks and uncertainties. Further information regarding these and other risks is included in our findings with the ICC. In addition, for non-GAAP measures discussed today, reconciliation information related to those measures can be found in our earnings press release. During today's call, Dr. Huo will speak in Chinese, and his comments will be translated into English. Now, I'd like to turn the call over to Dr. Guo Jingyi, co-founder and CEO of Locking Coffee. Dr. Guo, please go ahead. Good day, everyone, and welcome to today's earnings conference call. Thank you for your continued interest in and support for Locking Coffee. We delivered solid second quarter results as we remain focused on executing our core strategy of high-quality scale growth. Amid a dynamic market environment, we continue to strengthen our store network and the product innovation capabilities while growing our customer base and deepening bread-man-share.

These efforts further enhanced our long-term competitive advantages, helping us expand market share and reinforce industry leadership. 伴随中国咖啡消费需求的稳步增长 我们继续保持行业领先的开店速度 上半年门店竞争超5000家 二季度末全球门店总数突破3.6万家 累计交易客户数已接近5亿 公司本季度实现总净收入约159亿元 同比增长29% 受去年同期外卖高基数的影响,自营门店同店销售阶段性承压,二季度同比下滑5.3%,这一表现完全符合我们此前对业务节奏的判断。 于是同时 在外卖竞争逐步回归理清的环境下 本季度营业利润同比转为正增长 较去年同期增长22% 达到21亿元 营业利润率为13.4% 盈利修复态势进一步巩固 二季度的业绩再次印证了瑞幸高质量规模增长战略的有效性 也进一步增强了我们把握长期市场机遇的信心 Supported by continued growth in China's coffee consumption demand We maintain an industry-leading pace of store expansion

With more than 5,000 non-new stores opened in the first half of the year By the end of the second quarter, our global store count has surpassed 36,000, while cumulative transacting customers approached 500 million. Total net revenue for the quarter reached around R&D $15.9 billion, up 29% year-over-year. Since short sales for our self-operated stores declined 5.3% year-over-year in the second quarter primarily due to the temporary high comparison base created by elevated full delivery subsidies in the prior year period this performance was fully consistent with our previous expectations for the trajectory of business operations meanwhile as full delivery competition gradually returned to more rational levels our operating incomes resumed year-on-year of growth in the quarter, growing 22% to R&B 2.1 billion, with an operating margin of 13.4%. This further reinforced the recovery in our profitability. Our second quarter results once again validate the strength of our high-quality scale growth strategy and further strengthen our confidence in capturing long-term market opportunities. 产品创新和客户体验三个方面,介绍本季度人货厂三大业务支柱的运营进展,稍后CFO安静会和大家分享更详细的财务数据。 Next, I will walk you through the quarterly progress across our three core business pillars, people, products, and places, focusing on store coverage, product innovation, and the customer experience. Following that, our CFO engine will share more detailed financial updates. Starting with our store network, we continue to expand our nationwide footprint based on our long-term view of customer demand. We further strengthen our presence across cities of all tiers, enhancing consumer accessibility and the service capabilities to continuously unlock the long-term growth potential of China's coffee market. By the end of the second quarter, our global store count reached 36,310, up 39% new year.

We continue to lead the industry in both scale and expansion takes. 高速成长阶段 加强各线级城市和消费场景的覆盖能力 是建立长期市场领先优势的重要基础 依托瑞幸强大的数字化能力和战略执行力 我们能够精准洞察消费需求 并高效落地为门店规划布局 通过数据驱动的门店选址 数字化运营以及数字化营键

不断深化锐性与消费者的连接 持续将市场机遇 转化为长期市场份额

In China, we added the 2668 Nexo stores during the quarter bringing our total store count to 36,087 This includes 23,625 self-operative stores and 12,462 partnership stores. China's coffee market remains in a high-growth state, supported by rising penetration and increasing consumption frequency. Extending our reach across all CD tiers and consumption scenarios remains fundamental to building long-term market leadership Leveraging working strong digital capabilities and strategic execution, we are able to precisely identify consumer demand and efficiently expand our store network based on these insights. Through data-driven site selection, this will enable store construction and intelligent store operations. We continue to enhance expansion efficiency and operational consistency while maintaining store quality.

我们在确保单电质量的基础上 持续提升规模化補充效率 与运营的一致性

This enables us to deepen consumer engagement and consistently translate market opportunities into sustained market share gains. 国际市场方面,我们继续稳步推进海外业务扩展,依托中国市场成熟的数字化运营能力,结合当地消费者需求和市场特点,不断提升本地化经营水平。 二季度 海外竞争46家 门店总数达到223家 其中新加坡自营门店89家 美国自营门店20家 马来西亚加盟门店114家 立足现有市场 我们将持续迭代的产品运营及组织能力 不断打磨优化单店经济模型 沉淀标准化可复制的运营经验

internationally, we continue to expand our overseas presence in a disciplined manner, leveraging the proven digital operating capabilities we have developed in China. We tailored our approach to local consumer preferences and market dynamics to further improve our localized operations. In the second quarter, we added 46 manual stores, bringing our total international store counts to 223. This includes 89 self-operated stores in Singapore, 20 self-operated stores in the U.S., and 114 franchise stores in Malaysia. Building on our presence in these markets, we will continue to refine our product offerings and enhance our operational and organizational capabilities. We will also continue to optimize store-level economics and develop standardized, replicable operating practices, laying the groundwork for our continued international expansion.

Thank you very much. 创新的综合实力 并有效沉淀了具有锐性标识度的品牌资产 二季度该产品销量寄身掏不出单品 截至本季度末小黄油系列累计销量突破5亿杯 此外 我们着重强化健康化的产品策略和研发方向 丰富低负担的清爽型饮品选择 更好地贴合客户日益成熟的口碑偏好 本季度我们推出年度重磅小青菊美式 深化瑞幸标志性水果美式的品牌认知 同时满足消费者对高品质健康化饮品的升级需求 该产品上市首周销量突破千万杯 产品复购和用户留存均有着良好的表现 深受客户喜爱 非咖啡领域 本季度我们推出酸奶吸 冰奶等全新系列产品 持续丰富全品类产品布局 为消费者提供全时段 全场景的一战式饮品选择 截至二季度末 瑞幸25款累计销量突破一杯的产品中 非咖品类已占据五席 This has fully recognized the Gainis's strong product and product ability.

On the product front, we continue to strengthen Lockheed's position and make-up as a professional coffee brand, while leading innovative and health-conscious beverage trends through deeper insights into evolving consumer needs. In the second quarter, we launched 28 new freshly-glued beverages and over a dozen snack items. In the coffee category, we continue to develop signature products that embody Lockheed's unique brand identity, reinforcing the competitive mode built around our brand man-share. During the quarter, our Little Batch Americano once again gained significant traction. as consumers discovered creative ways of enjoying the product. This success demonstrates our ability to identify emerging trends, respond quickly to evolving practices, and continuously innovate the product experience, further strengthening the distinctive brand equity we have built over time. This product ranked among our top two best-selling products by volume in the biggest corner. And the cumulative sales of the Little Butter series surpassed 500 million cups by quarter We also continue to strengthen our wellness-oriented product strategy and R&D focus, expanding our selection of light and refreshing beverage options to better align with the evolving case preferences of our increasingly sophisticated customer base. During the quarter, we launched our annual flagship product, Palamanzi Americano, first evening consumer recognition of Lockheed's signature foodie Americano offerings, while meeting growing demand for high-quality, cost-conscious beverages, with sales surpassing 10 million cost within its first week of launch. This product delivered encouraging repeat purchase and customer retention performance. Reflecting its strong consumers beyond pausing, we introduced new product lines during the quarter, including yogurt smoothies and ice milk beverages, further broadening our omni-category product portfolios and providing consumers with a one-stop beverage destination across various day parts and consumption scenarios.

By the end of the second quarter, five of Lockheed's 25 products that have each support 100 million cups in cumulative sales were non-coffee products, further demonstrating Lockheed's strong brand appeal and the product execution capabilities. 但用户方面 我们持续提升消费者体验 通过便捷的门店网络 优质的产品供给和敏锐的数据洞察 不断夯实品牌心智和用户连接 提升客户规模与消费频次 刚才所提到的小朋友美式的再度走红 即使我们深化消费者互动 共同塑造品牌记忆的体现 也进一步推动了用户口碑和消费增长 此外 我们继续通过多元化 跨界联名等品牌互动方式 为客户提供超越产品本身的情绪价值 深化情感共鸣 在产品创新和品牌建设的共同推动下 二季度 我们新增交易客户超2500万 月均交易客户再创新高 同比增长23% 超1.1亿 截至二季度末 瑞幸累计交易客户已接近5亿 同时 客户月均消费倍量也创下历史新高 这既体现了消费者对瑞幸品牌与产品的持续认可,也印证了中国咖啡销贵习饭正在不断地强化。

On the customer side, we continue to enhance the customer experience through our accessible store network, high-quality product offerings, and data-driven consumer insights. These strengths further reinforce our brand measure and the connections with consumers, helping us expand our customer base and increase purchase frequency. As mentioned earlier, the strong market response to little-butter amount panel reflects our efforts to deepen consumer engagement and co-create lasting brand memories. It also further drove positive word of mouth and increased consumption. In addition, we continue to engage consumers through diversified brand initiatives, including IT collaborations, delivering emotional value beyond the products themselves, and fostering deeper brand relevance with our customers, driven by product innovation and brand building. We added more than 25 million new transaction customers in the second quarter, bringing average monthly transaction customers to a new record high of over 110 million, 23 percent year-over-year. By the end of the second quarter, our cumulative transaction customers approached 500 million. At the same time, our average monthly cost per customer also reached an all-time high.

These achievements reflect consumers' continued re-explanation of the lucky brands and products, while reaffirming that coffee consumption habits in China are continuing to depend. 此外 在践行企业责任方面 我们始终关注消费者的健康需求 将好和气健康的产品理念融入饮品研发和消费体验 近年来 瑞幸持续优化产品体系 提升供链品质和产品评审标准 推动健康化成为产品创新的重要方向 通过更清洁的配方和更优质的原料 为消费者提供兼顾口感、品质与健康的轻负担饮品体验 同时,我们不断深化与专业科研机构合作 推进咖啡健康的研究与科普 自2024年,与北京大学医学部 共建北大医学瑞幸咖啡健康创新基地以来 已完成多项创新课题 并将学术成果转化为产品实践 今年6月 我们联合新华网 北大医学部等多方 共同启动了咖啡健康科普行动 并发布2026年中国限制饮品健康趋势分析报告 未来 我们将持续推动研究成果与产品创新的结合 助力实现限制饮品行业的可持续健康化的发展. by enhancing supply chain quality and raising product evaluation standards,

making health conscious innovation an important focus of our product development. Through cleaner formulations and higher quality ingredients, we aim to deliver beverage experiences that balance taste, quality, and wellness. Meanwhile, we have continued to deepen collaboration with leading research institutions to advance coffee health research and consumer acquisition. Since establishing the Peking University Health Science Center Locking Coffee Health Innovation Day, in partnership with Peking University Health Science Center in 2024, We have completed multiple innovative research projects and continue to apply academic findings to project development. In June this year, together with TsinghuaNet, Tachy University Health Science Center and other partners, we jointly launched the Coffee Health Education Initiative, along with the release of the health and wellness trend in China's freshly prepared beverage market 2026. Looking ahead, we will continue to integrate research insights with product innovation and contribute to the sustainable and health-conscious evolution of the freshly good beverage industry. 以及长期积累的品牌资产,我们不断放大门店网络、产品创新和客户规模之间的协同效应,形成可持续的增长动能,充分把握中国咖啡消费的历史性增长机遇,展望未来。 In summary, the second quarter marks another significant quarter in which we continue to validate and deliver on our long-term growth strategy. High-quality scale growth is not simply about increasing short-count. It reflects our ability to continuously identify, respond to, and even create demand, and ultimately translate market demand into sustainable market share gains. Leveraging lock-in is digitally driven, replicable, and scalable operating models. Together with the brand equity, we have built over time. We continue to amplify the synergies across our store network, product innovation, and the customer base. These grants create sustainable growth momentum and positions as well to fully capture the historic opportunities presented by China's coffee market. Looking ahead, we remain committed to executing our high-quality scale growth strategy. As we consistently enhance our capabilities across store network coverage, product innovation, and customer experience, we aim to further expand our market share while creating long-term value for our customers, partners, and shareholders. Finally, we are deeply grateful to our consumers, partners and partners. and investors for their ongoing support, and to our 220,000 Locking Team members for their valuable contributions to the company's growth. We will continue to work together towards building a world-class coffee brand and making Locking Coffees a part of everyone's daily life. Now, I will turn the call over to Anjing to go through our financial results in detail.

Thank you, Jingyi. Good day, everyone. Thank you for joining today's call. In the second quarter, we delivered solid top-line growth and the continued profitability recovery, Reflecting our operational resilience and the strong execution of our growth strategy. Let me now walk you through the financial details. In the second quarter, total net revenues increased by 29% year-over-year to RMB 15.9 billion. Many driven by a 30% year-over-year increase in GMV to RMB 18.4 billion. This growth was supported by higher total cut volumes across both self-operated and partnership stores as we continue to expand our stock network and grow our customer base. Revenues from productive sales increased by 29% year-over-year to R&B $12.2 billion, reflecting the solid performance of our self-operated stores. Breaking down our product itself into three streams. Net revenues from freshly-brewed streams for R&B $11.2 billion, representing about 70% of total net revenues. Net revenues from other products for R&B $892 million, or about 6% of total net revenues. Net revenues from others were R&B $171 million, or roughly 1% of total net revenues. Looking at our company-owned stores, revenues from self-operated stores increased by 27% year-over-year to R&B $11.6 billion, thin-store sales growth was negative 5.3% for this quarter, mainly reflecting the high comparison base created by the elevated food delivery subsidies in the five-year period. Store-level operating profit increased by 26% year-over-year to R&B 2.5 billion, with self-operated store-level operating margin of 21.3%. Revenues from partnership stores increased by 28% year-over-year to RMB of $3.7 billion, accounting for 26% of total net revenues. This growth was largely driven by a continued expansion of our partnership store network. Self-material growth remained the largest contributor, followed by the delivery service fees and a profit sharing and loyalty fees cost of materials as a percentage of the total net revenues were 39 compared to 37 percent in the same period of 2025 mainly due to fluctuations in average selling price and a certain raw material price in actual terms cost of materials increased by 34% year-over-year to RMB's $6.1 billion, largely due to increases in cut volumes in self-operated stores and the material sales to partnership stores. Store rental and the other operating costs as a percentage of the total net revenues was 27%, compared to 22% in the same period of 2025. In absolute terms, these expenses increased by 36% year-over-year to R&B 3.6 billion, mainly driven by higher payroll costs from cost volume growth and rising rental expenses due to continued store expansion. Delivery expenses as a percentage of the total net revenues decreased to 10% from 14% in the same period of 2025. This improvement was mainly driven by a lower proportion of delivery orders as well as lower average delivery costs per order as we enhance fulfillment efficiency. In absolute terms, delivery expenses decreased by 3% year-over-year to R&B $1.6 billion. Sales and marketing expenses as a percentage of total net revenues were 6% compared to 5% in the same period of 2025. In actual terms, sales and marketing expenses increased by 56% year-over-year to R&B 925 million. Many due to higher expanding on advertising and promotion as well as higher commission fees paid to the food delivery and live stream platforms general and administrative expenses as a percentage of the total net revenue was six percent plus flat compared to the same quarter of the 2025 in absolute terms gna expenses increased by 34 percent year over year to R&B $985 million. Many driven by higher share-based compensation and payroll costs, as well as increased investment in research and development. Our GAAP operating profit increased by 22% year-over-year to R&B $2.1 billion, with an operating margin of 13.4% compared to 14.1% in the prior year period. On an un-GAAP basis, Operating profit increased by 26% year-over-year to R&B 2.4 billion, with a net gap operating margin of 15.1% compared to 15.3% in the five-year period. Net profit increased by 16% year-over-year to R&B 1.5 billion, with a net margin of 9.4% compared to 10.4% in the five-year period. On a net gap basis, non-profit increased by 23% to R&B 1.8 billion with a net gap net margin of 11 compared to 11.6% in the five-year period. Looking at our balance sheet and cash flow, we generate R&B 2.6 billion in net operating cash during the second quarter of 2026. As of June 30, 2026, our total cash position, which includes cash and cash equivalents, restricted cash, term deposit, and short-term investments was R&B $10.9 billion, compared to R&B $9 billion at the end of December 31, 2025. During the quarter, we utilized short-term borrowers as part of our capital allocation strategy to support an ongoing shareholder return initiative, but continued to maintain a strong net cash position of R&B 9 billion and a healthy leverage profile, supported by our robust cash generation capabilities and the disciplined financial management. This provides us with flexibility to continue investing future growth opportunities while returning capital to shareholders. During the second quarter, we repurchased 49 million Class A ordinary shares, or 6 million ADS, for a total consideration of $195 million and our $300 million share repurchase program. In closing, our second quarter marked another step forward in turning our long-term strategy into tangible results. Our expanded store network and growing customer base have precisioned us well for long-term growth. Looking ahead, we will remain focused on discipline and execution, continuous improvement in operational efficiency, and a sustainable value creation for our shareholders. With that, we will open the call for questions. Operator, please fill a hat.

Ladies and gentlemen, we will now begin the question-and-answer session. To ask a question, please press star, then 1. If you are using a speakerphone, please pick up your handset. To withdraw your question, please press star, then 2. The first question today comes from Jessie Xu with JP Morgan. Please go ahead.

Hi, everyone. Hello, I'm Gou总. I'm Nancy. I'm Morgan D'Apong of Jessie. Thank you. Thanks for taking my question. This is Jesse Shih from JP Morgan. Congrats on a very strong 2Q, very encouraging in a weak macro environment, especially against some challenges for the whole industry year-to-date. And second quarter turned out to be a beat in both same-store sales and also margins, clearly diverging from and outperforming the whole industry. So my question is mainly on second-half outlook. Considering a tough phase during July to August, how should we think about same-store sales trends for the second half? And as the delivery mix continues to normalize, how should we think about the margin and earnings outlook from here?

Thank you. Thank you for your question. I will answer this question.

Great. So thank you for the question. Since the beginning of the year, Delivery platform competition has gradually returned to a more reasonable level. We believe the freshly brewed beverage industry is also moving towards a healthier and more sustainable development stage. And the market competition is increasingly shifting back to product innovation, operational excellence, and consumer value creation. so all the areas we're looking at consistently in that and build our long-term strength around 从外部环境来看 外卖补贴收缩的节奏是快于我们年初的预期 去年外卖补贴形成的高技术压力也开始逐步的显现出来 并已经反映到了二季度同店的表现中 对于三季度 由于去年的七八月份处在一个平台外卖补贴较为激烈的阶段 我们预计相关高基础的影响仍将持续 但与此同时随着外卖占比自去年三季度的高点以来持续回落 以及配送履约效率的稳步优化 我们也看到盈利修复的趋势也更加清晰 利润表现也正在持续的改善中 Right, so from an external perspective, full delivery subsidies have been scaled back more quickly than we initially expect at the beginning of the year. So the high rate pressure created by last year's elevated subsidies has also become more apparent and it's already reflected in our second quarter sales performance. As for the third quarter, as platform subsidies were particularly intense during July and August of last year, we expect the result from high-base effect to persist. At the same time, we are seeing improving trends in our profitability and margins, supported by the continued decline in delivery mix from peak levels since the third quarter of last as well as the improvements in our fulfillment efficiency. And from an internal perspective, we've also continued to optimize various products and operational initiatives this year with very encouraging results. For example, our cup size upgrade initiative and the product innovation around Little Butcher Americano, I just mentioned, these efforts not only enhance customer experience, but also supported the overall average selling price and our cup volumes. 因此总体而言,我们对下半年经营表现总体保持谨慎乐观。 我们将持续根据市场环境和消费者的需求变化,灵活优化经营策略, 在把握长期增长机遇和提升盈利能力之间保持平衡, 努力推动业务实现更加高质量,更可持续的发展。 谢谢。 Overall, we remain cautiously optimistic about our operating performance in the second half of the year. We'll continue to adapt our strategies based on evolving market conditions and the consumer needs and balancing the long-term growth opportunity with profitability improvement and driving higher quality and more sustainable growth for our business. Thank you.

The next question comes from Xinyu Ruan with Goldman Sachs. Please go ahead.

Let me translate my question into English. So the company has a very fast store opening pace in the first half, but in the meanwhile we see industrial-wise store self-growth pressure under the delivery of minimalization, and multiple players actually sold down store opening this year. On this backdrop, what supported Lackey's fastest expansion, and what is the company's plan and strategy on store opening in the second half, and is the opening outlook, and how do we balance store opening and store self-growth. And in the longer term, how do we think about the room for the store expansion in China?

Thank you. 这既是我们能够坚持高质量规模增长战略的重要基础,也是我们能够持续开新店,开好店的最重要的核心驱动因素。 Thank you for the question.

First, I'd like to reiterate that we remain very confident in the long-term growth potential of China's coffee market. So compared with more mature coffee markets globally, coffee consumption in China remains in the early stages of habit formation with significant room for future penetrations and frequency growth. This long-term market opportunity is the foundation for our high-quality scale growth strategy. is also the key driver for our continued expansion, leaving us plenty of headroom to continue opening more stores while maintaining store quality. As coffee consumption increasingly becomes part of China's consumers' daily routines, Locking has built a nationwide store network, covering all city tiers and diverse consumption scenarios. So from Tier 1 cities to county-level markets and townships, and across different consumption scenarios, for example, office buildings, commercial districts, streetfront locations, residential communities, campuses, and transportation hubs, we continue to expand consumer accessibility and strengthen Lockheed's brand share as a nationwide professional coffee brand. 因此对于瑞幸而言 门店的增长不仅仅是简单的增加门店的数量 而是依托全国性的门店网络 强大的品牌力和产品力 持续精准的识别和满足不断增长的咖啡消费需求

而支撑这一能力的是一套覆盖人货场全链路可复制可拓展的经营体系 从需求洞察门店选址建设运营到凑序经营优化 我们通过数字化能力和AI技术持续提升决策效率 依靠成熟的组织能力和强大的执行力 确保新链能够快速高质量的落地,并不断提升运营质量。 So for Lockheed, store expansion is not simply about adding more stores.

It's actually more about leveraging our nationwide store network, strong brand equity, and the product capabilities to better identify and serve the growing customer demand. And supporting this is a highly scalable and replicable operating model covering the full value chain across people, products, and places. From demand insights and site selection to our store construction operations and the ongoing optimization, we leverage our digital capabilities and AI technologies to improve our decision-making efficiency. Our mature organizational capabilities and strong execution actually ensure that we can open stores quickly while maintaining store quality and continuously enhance our store performance. At the same time, our expanding store network further strengthens our brand influence, enhances our ability to scale product innovation, and creates a virtuous cycle among stores, products, and customers.

And so, store expansion is not an end in itself, but a crucial foundation for sustainably gaining market share. 最后总结一下 我们始终认为 中国咖啡市场的门店天花板还非常高 随着咖啡人群的渗透率和消费频次的不断提升 这一天花板还在不断的上拓 因此我们有信心保持有竞争力的开店节奏 努力把握中国咖啡市场长期的增长机遇 持续提升瑞幸的市场份额 谢谢 Right.

So to conclude, we believe there remains substantial capital for store growth in China's coffee market. As coffee penetration and consumption frequency continue to increase, the overall market capacity will continue to expand. We are provident in our ability to maintain a competitive pace of store extension, capture the long-term growth opportunities in China's coffee market, and continue to grow Lacking Coffee's market share. Thank you.

Due to time constraints, no further questions will be taken at this time. This concludes the question and answer session. I'd like to turn the call back to the management team for any closing remarks.

Thank you, everyone, for joining our call today. If you have any further questions, please feel free to contact our IR team. This concludes today's call. We look forward to speaking with you again next quarter. Thanks.

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