Q1 2025 Huize Holding Ltd Earnings Call
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Operator: Ladies and gentlemen, thank you for standing by and welcome to Huize's first quarter 2025 earnings conference call. At this time, all participants are in the listen-only mode.
Ladies and gentlemen, thank you first buy.
Welcome to wait till the first quarter to an 825 conference call.
Speaker Change: Oh gosh.
Operator: After the management prepare remarks, we will have a question and answer session.
We thought it would be but.
Speaker Change: The manuscript prepared remarks will be a couple of question and answer session.
Operator: This conference call is being recorded and a webcast replay will be available on Huize's IR website at ir.huize.com under the events and webcast section.
Speaker Change: This conference call is being recorded and a webcast replay will be up as a bolt on wages.
Speaker Change: Alright.
Speaker Change: Great.
Speaker Change: You bet.
Speaker Change: Right.
Kenny Lo: I would like to hand the conference over to your special host today, Mr. Kenny Lo, Huize's Investor Relations Manager. Please go ahead, Kenny. Thank you, operator.
Speaker Change: I would like to either comprehends, so back to your Gulf Coast today.
Kevin: Oh wait till Investor Relations manager. Please go ahead Kevin.
Kevin: Thank you operator, Hello, everyone and welcome to our first glad to hang on to five earnings conference call.
Kenny Lo: Hello, everyone, and welcome to our First Class 2025 Earnings Conference Call. Our financial and operational results were released earlier today and are currently available on both our IR website and global news website.
Speaker Change: Nashville, and operational results were released earlier today.
Kevin: I will be available on both our website and global Newswire services.
Kenny Lo: Before we continue, I would like to refer you to the safe harbor statement in our earnings press release, which also applies to this call as we will be making forward-looking statements. Please also note that we will discuss non-GAAP measures today, which are more thoroughly explained in our earnings release and followings with the SEC.
Kevin: We continue I would like to refer you to the Safe Harbor statement in our earnings press release, which also applies to this call US we will be making forward looking statements. Please also note that we will discuss non-GAAP measures today, which are more perfectly explained it you know.
Kevin: Our earnings release, and our colleagues with the S E C.
Kenny Lo: Joining us today are our Founder and CEO, Mr. Chen Junma, COO, Mr. Li Jiang, Co-CFO, Mr. Minghang Xiao, and Co-CFO, Mr. Ron Tam.
Speaker Change: Joining us today are founder and CEO, Mr. Jim Barr.
Liang: Hello, Mr Liang CFO Mr. Nicolas.
Mr. Ma: Oh, Mr. Ron Hutton Mr. MA we've started the call by providing an overview of the company's performance and operational highlights for the time at this time, who will go over our financial results for the first quarter 2025, and we will open up the call for questions I would now turn the call over to Mr. Ma.
Kenny Lo: Mr. Ma will start the call by providing an overview of the company's performance and operational highlights, followed by Mr. Tam, who will go over our financial results for the first quarter of 2025. Then we will open up the call for questions.
Yuping Ma: I will now turn the call over to Mr. Ma. Hello, everyone. Welcome to Huize's 1st quarterly sales call conference in 2025. Hello, everyone, and thank you for joining Huize's first quarter 2025 earnings conference.
Mr. Ma: Yeah.
Mr. Ma: Okay.
Mr. Ma: Why isn't that Katherine Yao.
Mr. Ma: Any out in that.
Mr. Ma: Yeah, you're probably a hobby.
Speaker Change: Hello, everyone and thank you for joining wages first quarter.
Speaker Change: Earnings Conference call.
Yuping Ma: In 2025, in the face of the continuous fluctuation of the macroeconomic and international pattern, Huize will always stick to the client-centered approach, based on the deep understanding of user needs over the years.
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Unknown Executive: Unknown Executive, Yuping Ma, Qingqing Mao, Kwok Tam, Kenny Lo, Huize Holding Xi Jinping, Unknown Executive, Yuping Ma, Cunjun Ma, Kwok Tam, Kenny Lo, Huize Holding You can go 出成总保费14.4亿 he's worth 38% Qingqing Mao, Kwok Tam, Kenny Lo, Huize Holding Huanbi has increased by 31%, and the tax revenue of 7.1 billion yuan has increased by 46%.
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Yuping Ma: In 2025, against a backdrop of ongoing macroeconomic and geopolitical volatility, Huize upholds its customer-centric approach, leveraging years of insights into customers' needs. We stay ahead of market trends and are now working alongside leading insurers, continually expanding and refining our product offerings. At the same time, we are accelerating the integration of AI across our operations, driving remarkable productivity improvement and further optimizing our core structure to lay the solid foundation for long-term value creation. In the first quarter, operating revenue exceeded RMB$280 million, with gross revenue premiums and first-year premiums facilitated on our platform increasing 38% and 31% sequentially, reaching RMB$1.4 billion and RMB$730 million, respectively.
Speaker Change: In 2025 against the backdrop of ongoing macroeconomic and geopolitical volatility.
Speaker Change: Oh this customer centric approach leveraging yourself insights customers' needs. We stay ahead of market trends and now working alongside leading insurers continually expanding and refining our product offerings.
Speaker Change: Same time, we are salaried hang the integration of AI across our operations driving remarkable productivity improvement and further optimizing our cost structure to lay a solid foundation for long term value creation in the first quarter operating revenue exceeded RMB 219 million with gross written premiums.
Speaker Change: First year premiums.
Liang: On our platform, increasing 40% and 1% sequentially, reaching our M. B, a one 5 billion and RMB 700 million, respectively. Renewal premiums also grew 646% sequentially to approximately RMB $710 million.
Yuping Ma: Renewable premiums also grew 46% sequentially, to approximately RMB$710 million.
Yuping Ma: Unknown Executive, Yuping Ma, Qingqing Mao, Kwok Tam, Kenny Lo, Huize Holding 当季新增用户39万,其中,长崎县投保用户平均年龄为35岁, 二线及以上城市用户占比连续多个季度稳定在35%以上。 Unknown Executive, Yuping Ma, Qingqing Mao, Kwok Tam, Kenny Lo, Huize Holding Wanbi rose 58%, reflecting the long-term growth of the company and the high-value client group's business achievements. At the end of February this year, of Long-term Seller in the 13th and 25th months combination sustained higher than 95% Huize remains committed to providing full-life cycle insurance solutions for its high-value customers. By quarter-end, our cumulative number of users surpassed 11 million, with 390,000 new clients added during the quarter. The average age of long-term insurance customers was 35, with over 65% residing in high-tier states, where we have consistently achieved this percentage over the past few quarters.
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Sanjay: Thank you Sanjay.
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Liang: Keith.
Liang: Pfizer remains committed to providing through a lifecycle of insurance solutions for its high value customers by quarter and our cumulative number of users surpassed 11 million with 398000, new clients added during the quarter. The average age of a longtime insurance customers was great.
Liang: Over 65% of siding.
Liang: It's really done.
Liang: We have consistently a ship.
Liang: Thanks.
Liang: Over the past few quarters.
Yuping Ma: In terms of FYP, the average tech size for long-term products rose 58% to over RMB5,400. Underscoring the effectiveness of our sustainable customer strategy. As of the end of February, 15th and 25th month persistency ratios for long term insurance maintained industry leading levels of over 95%. Since the end of the first quarter, Huize has maintained a stable cooperation relationship with 143 insurance companies.
Liang: In terms of FY <unk>, the average ticket size for a long term product rose, 58% to open our MB 5400.
Liang: Underscoring the Patrick Ness of our sustainable customer strategy.
Liang: Softly and February 10th and trying to fit my persistency ratios for a longtime insurance maintained industry leading levels of over 95%.
Liang: Give me a little more quick ebay and yacht volume going through the Berkshire went deep banking.
Liang: Thank you.
Unknown Executive: Chen, Unknown Executive, Yuping Ma, Qingqing Mao, Kwok Tam, Kenny Lo, Huize Holding honey on Dianyin.
Liang: In Q2 type product.
Liang: On the island.
Unknown Executive: Unknown Executive, Yuping Ma, Qingqing Mao, Kwok Tam, Kenny Lo, Huize Holding 客户财富保障需求进一步凸显 Huize has joined forces with Xinhua Renshou to launch Kuaixiangfu No. 3 which aims to protect the people's wallets through cost-reduction and fully utilize the technology.
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Unknown Executive: Unknown Executive, Yuping Ma, Qingqing Mao, Cunjun Ma, Kwok Tam, Kenny Lo, Huize Holding As of the end of March, we had strong partnerships with Unknown Executive, Yuping Ma, Qingqing Mao, Kwok Tam, Kenny Lo, Huize Holding Unknown Executive, Yuping Ma, Qingqing Mao, Cunjun Ma, Kwok Tam, Kenny Lo, Huize Holding Unknown Executive, Yuping Ma, Qingqing Mao, Kwok Tam, Kenny Lo, Huize Holding Huize has jointly launched the global version of Xiaotaoji, Shao'er Zongji, in order to maintain its high-quality resources overseas. 展新支持了全球理陪及海外就医等安排 As of the end of March, we had strong partnerships with 143 insurance companies and continue to develop and launch differentiated customized products with insurer partners.
Liang: Okay.
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Liang: As of the end of March we have strong partnerships with 123 insurance companies and continue to develop and launch differentiated customized products with issuer partners with declining yields on traditional bank deposits and wealth management products demand for a while.
Unknown Executive: With declining use on traditional bank deposits and wealth management products, demand for wealth protection solutions has intensified. In response, we partnered with New China Life to launch Please Know Free, a savings product striving to achieve sustainable returns for customers. Additionally, we expanded our portfolio of customized participating products, building on the Fu Manjia series co-launched with Alipha Copco. We partnered with Cathay Ludiadrie Life Insurance on Jinma Yijun No. 6, a participating incremental home life insurance product. This was followed by the launch of Xinhai Huixuan, a participating annuity product co-developed with Pramerica Fosun Life Insurance. These customized products were designed to cater to the industry-wide demand shift from fixed returns to fortune returns, further solidifying our leadership in China's participating insurance segment.
Liang: She illusion has intensified the response with Connor with neutralized to launch with new free savings products driving to achieve sustainable returns for customers. Additionally, we expanded our portfolio of customized participating products.
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Liang: With your entree life insurance on Timna mutual number six our participate any incremental whole life insurance product. This was followed by the launch of <unk>.
Liang: <unk> are participating annuity product co developed with comerica potent life insurers this customized products, where the signer to cater to the industry wide demand shift from fixed which highest reported returns or they started buying.
Liang: Buying our leadership in China's participating insurance stockman in Milwaukee Global expansion strategy. We introduced this chart how key global assurance critical illness product for developed with Cigna and C. M. B a life insurance that Leverages. Their August these resources to offer global client that remains and oversee medical support.
Unknown Executive: In view of our global expansion strategy, we introduced Xiao Tao Qi Global, a children's critical illness product co-developed with Xinhai and CMB Life Insurance that leverages their overseas resources to offer global client settlements and overseas medical support.
Unknown Executive: Unknown Executive, Yuping Ma, Qingqing Mao, Kwok Tam, Kenny Lo, Huize Holding Chinese. Thank you.
Liang: So you guys, sometimes for al so agile and <unk>.
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Unknown Executive: Unknown Executive, Yuping Ma, Qingqing Mao, Kwok Tam, Kenny Lo, Huize Holding Unknown Executive, Yuping Ma, Qingqing Mao, Kwok Tam, Kenny Lo, Huize Holding Unknown Executive, Yuping Ma, Qingqing Mao, Cunjun Ma, Kenny Lo, Huize Holding under the leadership of a fully-fledged, open-source, artificial intelligence model. Unknown Executive, Yuping Ma, Qingqing Mao, Kwok Tam, Kenny Lo, Huize Holding Chen, Unknown Executive, Yuping Ma, Qingqing Mao, Kwok Tam, Kenny Lo, Huize Holding Qingqing Mao, Kwok Tam, Kenny Lo, Huize Holding 公司实现成本结构持续优化 The company continues to optimize the cost structure Sales costs, management costs, R&D costs, and other operating costs have all decreased by 20% in total.
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Unknown Executive: Xi Jinping, Unknown Executive, Yuping Ma, Cunjun Ma, Kwok Tam, Kenny Lo, Huize Holding The rapid advancement of generative AI and AI agents is transforming traditional enterprise workflows. And our AI strategy, we continue to enhance both the user experience and operational efficiency. We have deployed the Huize AI agent development platform internally, with a goal of developing independent AI productivity. Leveraging open source AI models, we have implemented private domain deployment of large language models to ensure data security and regulatory compliance. At the same time, we are actively promoting the development of local agents, local AI agents to accelerate AI agent creation using visualization tools.
Liang: He has shouldn't go that jump in and shop.
Liang: The rapid advancement of generative AI and AI agent is transforming traditional enterprise workflows and now AI strategy, we continue to enhance both the user experience and operational efficiency. We have deployed it avoids AI agent development platform internally with a call off the ball.
Liang: Opinion handling our productivity.
Liang: Leveraging open source AI models.
Liang: We have implemented private domain with deployment of large language model to ensure data security and regulatory compliance.
Liang: Same time, we are carefully promoting at the Bolivar mineral local agents at local AI agents.
Liang: Salary AI agent creation using visualization tools. This is driving a company wide productivity revolution with AI agents asking us.
Unknown Executive: This is driving a company-wide productivity revolution with AI agents acting as a new generation of digital employees. In a quarter, we have further optimized our cost structure and operating expenses, with total operating expenses falling by 29% sequentially. Huize has always been a client-centered company. to create a personalized insurance experience through innovative technology. In the first quarter, we officially launched the AR App Smart Entrance to provide clients with an online insurance agent for 7 to 24 hours. Consumer Services Consumer Products Consumer Products Consumer Products We have reached more than 150,000 daily service users. At the same time, we have fully reconstructed the user after-sales service process experience.
Liang: A new generation of digital employees in a quarter, we have further optimized our cost structure and reduce operating expenses with total operating expenses falling by 29% sequentially.
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Unknown Executive: Among them, the Xiaomi LiPay AI smart body is gradually realizing the automation of reporting, reviewing, payment, and full process. At present, we have completed the AI version of the full-screen payment report and will continue to develop it for apps and small programs. After the full launch, the overall efficiency forecast of Xiaoma Flash Payment will be compressed from one day to one hour, providing the most efficient payment experience for customers. Xiaoma Payment continues to provide reliable and secure insurance payment services to customers. In the first quarter, the total amount of Xiaoma Payment reached 1.9 billion yuan, and the total settlement amount reached 36,000 yuan.
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Speaker Change: Sounds like Duquesne yet.
Unknown Executive: Our customer-centric approach leverages innovative technologies to deliver personalized insurance service experiences. During the quarter, we launched an AI-powered smart portal on Huize's app, offering 24-7 insurance agent support. Our AI services now cover key customer lifecycle touchpoints, including policy inquiries and product managing, serving an average of over 15,000 users daily. We are also revolutionizing after-sales claims processing through XiaoMa Claims AI agents, achieving end-to-end automation of claims reporting, review, and payout. With AI now capable of handling all claims reporting, we are now working to extend this innovative feature to our apps and mini-programs. This innovation is expected to reduce processing time on XiaoMa Flash claims from one day to one hour upon full rollout.
Liang: Yes.
Liang: Our customer centric approach leverages innovative technologies to deliver personalized insurance of experiences during the quarter, we launched an AI powered macro I just now all ranked 27 insurance agents apart.
Liang: Our services now cover customer lifecycle of touch points in crude imports in Paris and product matching serving an average of over 15000 users daily. We're also a revolution of lifetime asset sounds claims processing through Chalmette claims AI agents and shipping Andrew and automation of claims for calling.
Liang: Review and payout.
Liang: Now capable of handling our claims reporting we are now working to extend this innovative fisher to our app that mini programs. This innovation is expected to reduce processing time on Xiaomi crashed Huang from one day to one hour upon full rollout during the quarter showing a claim facilitated RMB one.
Unknown Executive: During the quarter, XiaoMa Claims facilitated RMB$190 million in claims across 36,000 cases, providing customers with efficient and reliable insurance claim services.
Liang: <unk> hundred $90 million in claims across 46000 cases, providing customers with efficient and reliable insurance claim service.
Liang: Yes.
Unknown Executive: Huize's international brand Poly Insurtech recorded strong growth, highlighting the potential for growth in new markets such as Southeast Asia. Accordingly, the Vietnamese subsidiary Global Care has maintained a good growth rate. In China, the total insurance bills increased by 29%, and total insurance fees and revenue jumped from 35% to 34% respectively. Recently, China has reached equitably with the most leading logistics providers.
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Unknown Executive: China For More Chinese videos, subscribe my YouTube channel, please.
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Unknown Executive: Huang Li, Yingsu Tech, 为越南保险市场持续复仍,带来创新变革, 标志着集团国际化进一步重要的里程碑。 We are steadily advancing the business of overseas markets such as Singapore and the Philippines. We are steadily moving towards the 30% target of overseas sales in 2026. Our international brands continue to deliver strong growth momentum, underscoring the vast and talented potential of Southeast Asia. Vietnam needs operations, global care, maintaining solid traction and growth total policy count by 29% compared to the first quarter in 2024. The growth rate in premiums and revenue increasing by 35% and 34% year-over-year respectively. We recently partnered with Vito Post, the leading logistics service provider in the region, to expand our distribution network, further growing our team of independent financial advisors and enhancing the reach and conversion capabilities of the G-cell platform.
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Speaker Change: Our international brands in Japan continue to deliver strong growth in Atlanta, and the scoring the bottom tablet potential southeast Asia, we normally its operation Global care maintained solid traction and grew total policy count by three 9% compared to the first quarter in China and of course the growth.
Speaker Change: Written premiums and revenue increasing by 5% and very focused on year over year, respectively. We recently partnered with Frito post a leading logistics service provider in the region to expand our distribution network vertical in our team of independent financial advisors and enhancing the reach and conversion.
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Unknown Executive: On the product side, GlobalCare launched five-year and 10-year critical illness insurance products in collaboration with PBI Insurance, enriching our product portfolio to better meet customers' diverse protection needs.
Speaker Change: As a platform.
Speaker Change: On the product side Global Cal launched five year, and 10 year critical illness insurance products in collaboration with PVA insurance.
Speaker Change: And reaching out.
Speaker Change: Polio to better meet customers' diverse protection needs Pone issue Tac continues.
Unknown Executive: Pony Industry Tech continues to drive the transformation of the Vietnamese insurance market through innovation and marks a crucial milestone of our international expansion. We are making steady progress in expanding into Singapore and other overseas markets and are on track to achieve our goal of reaching 30% of total revenue contribution from international markets by 2022.
Speaker Change: Continuous to drive the transformation of the Wyndham lease insurance market through innovation and mathematics crucial milestone of our international expansion, we are making steady progress in expanding into Singapore and other overseas markets and are on track to achieve our goal of appreciate your percent of total revenue contribution from international.
Speaker Change: My cats by 2026.
Yuping Ma: 全球宏观与地缘环境,仍然充满了变化。 Unknown Executive, Yuping Ma, Qingqing Mao, Kwok Tam, Kenny Lo, Huize Holding Unknown Executive, Yuping Ma, Qingqing Mao, Kwok Tam, Kenny Lo, Huize Holding Unknown Executive, Yuping Ma, Qingqing Mao, Kwok Tam, Kenny Lo, Huize Holding We're moving back to our initial goal. Through product innovation, customer experience, and AI, Huize will continue to create a win-win value for insurance companies and end-users, bringing a long-term and sustainable return to shareholders. Global macro and geopolitical conditions remain volatile. Yes, insurance demand in China and across Asia stays resilient with digital adoption accelerates, drawing on deep customer insights and AI driven product innovation and strong momentum in Vietnam and other Southeast Asian markets.
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Speaker Change: Global macro and geopolitical conditions remain volatile, yes insurance demand in China and across Asia stays or sell in with digital adoption accelerates drawing on deep customer insights and AI driven product innovation and strong momentum in Vietnam and other southeast Asian markets. How is the delivered another quarter of solid growth and operating it.
Yuping Ma: Huize delivered another quarter of solid growth and operating agility. Looking ahead, we will widen our range of savings and have products for high value clients, embedding our self hosted large language model platform across the service chain to lift efficiency and experience. Internationally, holding industry tech further tap into Singapore and other priority markets, keeping us on course overseas revenue target. grounded in product innovation, customer experience and AI enablement. Huize will continue to create win-win value for insurers and customers while delivering sustainable long term returns for shareholders.
Yuping Ma: Looking ahead, we will widen our range of savings and how products for high value clients and banning ourself wholesale lashed language model platform across the service change lift efficiency and experience internationally, how do you ensure tax credits, having Europe, Singapore and other priority markets, giving us.
Speaker Change: When cross overseas revenue targets.
Speaker Change: Grounded in product innovation.
Speaker Change: Greetings and enablement.
Speaker Change: There will continue to create win win value for insurers and customers, while delivering sustainable long term returns for shareholders.
Kenny Lo: Next, our CFO Ron will give you a detailed overview of our performance and financial data.
Speaker Change: Okay got it show them the sample ramp he digests Yankee Jetblue on La Yaqui, such LG <unk>.
Yuping Ma: This concludes my prepared remarks for today.
Speaker Change: This concludes my prepared remarks for today I'll now turn the call to our CFO, Mr. <unk>, who will provide an overview of our key financial highlights for the third quarter.
Ron Tam: I will now turn the call to our CFO, Mr. Ron Tam, who will provide an overview of our key financial highlights for the third quarter. Thank you Mr. Ma and Kenny. Good evening everyone in Asia and good morning for those in the U.S. Total Operating Revenue remains at RMB 284 million. Our financial position remains very robust with a combined balance of cash security of around RMB 202 million or USD equivalent 28 million as of the end of the March quarter. This resilient performance was driven by our efficient omni-channel distribution network, our focused efforts to continue to acquire high-quality customers from the market, and the deployment of advanced proprietary AI solutions.
Speaker Change: Yes.
Speaker Change: Thank you Mr Mine, Kenny good evening, everyone in Asia and good morning for those in the U S.
Ron Hutton: It's Ron here, despite a challenging macroeconomic and geopolitical environment, we have delivered yet another.
Ron Hutton: Quarter resilient performance.
Ron Hutton: Which the first quarter for both total gross written premiums GWB and first year premium facilitated on our platform.
Ron Hutton: Increasing by 37, 8% and 39% sequentially.
Ron Hutton: In RMB, one 4 billion and RMB, seven 3 million respectively.
Ron Hutton: Total operating revenue remained.
Ron Hutton: RMB $284 million.
Ron Hutton: Our financial position remains very robust with a combined balance of cash liquidity of around RMB, <unk> 2 million or U S dollar equivalent and $28 million as of the end of the March quarter.
Ron Hutton: This resilient performance was driven by our efficient Omnichannel distribution network.
Ron Hutton: A focused effort to continue to acquire high quality customers from the market.
Ron Hutton: And the deployment of advanced proprietary AI solutions.
Ron Tam: Crucially, we have made significant progress in executing on our international expansion strategy, which is a key growth driver for long term sustainable growth for the company. Our strategic focus has remained on long-term insurance products, which continue to account for over 90% of total GWP facilitated on the platform. Leveraging on our robust omnichannel distribution network and advanced AI solutions, we are significantly strengthening customer acquisition engagement, adding approximately 390,000 new customers during the first quarter of 2025. This brings our total customer base count to 11 million as of the end of the first quarter. In addition, repeat purchase ratio for our long-term insurance products stood at a very high level of 38%, demonstrating our ability to continue to unlock the lifetime value of a high quality customer base through effective upselling and cross We've also seen, you know, reasonable reductions in all three kinds of operating expenses, ranging from 15% to 48% quarter over quarter, which has improved our expense to income ratio by 11.5 percentage points, quarter over quarter to 29% in the first quarter of 2025.
Ron Hutton: Crucially, we have made significant progress in executing on our international expansion strategy, which is a key growth driver for long term sustainable growth for our company.
Ron Hutton: Our strategic focus has remained on long term insurance products, which continued to account for over 90% of total GDP.
Kate: This is kate on the platform.
Speaker Change: Leveraging on our robust omnichannel distribution networks and advanced AI solutions, we are significantly strengthening customer acquisition engagement.
Ron Hutton: Adding approximately 390000, new customers during the first quarter of 2025.
Ron Hutton: This brings our total customer base count to $11 million.
Ron Hutton: The end of the first quarter.
Ron Hutton: In addition repeat purchase ratio for our long term insurance products stood at.
Ron Hutton: High level of 38% demonstrating our ability to continue to unlock.
Ron Hutton: Life time value of our high quality customer base.
Ron Tam: Effective upselling and cross selling.
Ron Hutton: If all athene.
Ron Hutton: Neil reasonable reductions in all three kinds of operating expenses, ranging from 15, 815% to 48% quarter over quarter, which has improved our expense to income ratio by 11, five percentage points quarter over quarter to 29% in the first quarter of 2025.
Ron Tam: In addition, total operating expenses have fallen by 29% compared to the fourth quarter of 2024. The reduction reflects decisive actions in continued workplace optimization, broad deployment of AI driven automation, which has sharply reduced manual workload and boosted efficiency throughout the business flow. This result demonstrates the strength of our Intelligent Cost Control Framework in delivering real cost savings and productivity gains in the business. A clear illustration of our AI-driven productivity gains is the use of localized AI avatars in marketing. These avatars can replicate a human voice and appearance in under a minute, producing highly engaging insurance content that is virtually indistinguishable from a live presenter.
Ron Hutton: In addition, total operating expenses.
Ron Hutton: Followed by 29% compared to train.
Ron Hutton: The first project 24.
Ron Hutton: The reduction reflects decisive actions in continued workplace optimization broad deployment of AI and automation, which has sharply reduced menu workload it boosted efficiency throughout the business flow.
Ron Hutton: This result demonstrates the strength of our intelligent cost control framework in delivering real cost savings and productivity gains in the business.
Ron Hutton: A clear illustration of our AI driven productivity gains is the use of localized.
Ron Hutton: Marketing.
Speaker Change: These other tuck in replicate a human voice and appearance.
Speaker Change: Under a minute producing highly engaging insurance content that is specialty indistinguishable from the likes of center.
Ron Tam: Integrated with our content management platform, the system now automates script generation, video editing, and distribution, creating a seamless end-to-end workflow. As a result, we are scaling our social media presence with richer, more compelling content, while materially reducing production time and cost. Our International Growth Engine, Pony Instrutec delivered yet another solid quarter and remains central to our long-term strategy. Building on the success of a proprietary AI toolset in China, we are now looking to deploy these solutions across our overseas operations to streamline workflows and deliver a more personalized customer journey. Vietnam continues to provide a robust proof of concept for our Southeast Asia playbook and we are making steady progress towards entering Singapore this year.
Speaker Change: Integrated with our content management platform the system that automates script generation video editing and distribution, creating a seamless end to end workflow.
Speaker Change: As a result, we are scaling our social media presence with which are more compelling content, while materially reducing production time and cost.
Speaker Change: Our international growth engine plenty of Intertek.
Speaker Change: Delivered yet another solid quarter and remain central to our long term strategy.
Ron Tam: Building on success of our proprietary AI tool set in China, we are not looking to deploy these solutions across our overseas operations to streamline workflows and deliver more personalized customer journey.
Ron Tam: Vietnam continues to fire up the bus proof of concepts for Southeast Asia Playbook, and we are making steady progress towards entering Singapore. This year.
Ron Tam: This initiative is to further diversify our revenue mix and establish additional scalable growth drivers to the global market. In closing, we believe that we are well positioned to capture the opportunities emerging from China's rapidly evolving insurance landscape and the broader Asian market. Domestically, robust demand for long-term protection underpins a healthy, sustainable growth trajectory across the value chain. Internationally, Pony Instrutec allows us to replicate and apply a China-proven model and proprietary AI capabilities to high-growth Southeast Asian markets. particularly among the young, rapidly expanding middle class. By combining advanced data analytics, end-to-end AI enablement, and disciplined market penetration, we aim to cement Huize's status as Asia's premier intratech platform.
Ron Tam: These initiatives will further diversify our revenue mix and established additional scalable growth drivers.
Speaker Change: In closing, we believe that we are well positioned to capture the opportunities emerging from chinas rapidly evolving insurance landscape and the broader Asian market.
Speaker Change: Domestically robust demand for a long term projection underpins a healthy sustainable growth trajectory across the value chain.
Speaker Change: Internationally pony into that allows us to replicate and apply a China proven model and proprietary AI capabilities to high growth Southeast Asian markets.
Speaker Change: Particularly among the young rapidly expanding middle class.
Speaker Change: By combining advanced data analytics end to end AI enabled and disciplined market penetration, we aimed to cement wages datasets Asia, EMEA and should that platform seamlessly connecting consumers carriers and distribution partners and delivering durable value to all stakeholders.
Ron Tam: seamlessly connecting consumers, carriers, and distribution partners, and delivering doable value to all stakeholders.
Operator: And with that, we now open up the call to questions. Thank you very much and over to you, operator. Thank you. We will now begin the question and answer session. To ask a question on the phone, please press star 1 1 and wait for a name to be announced. To cancel your request, please press star 1. One moment for the first question.
Speaker Change: And with that we'll now open up the call to questions. Thank you very much and over to you. Operator. Thank you. We will now begin the question and answer session to ask questions on the call. Please press star one one correct name to P&L.
Speaker Change: Mechanically a request please press star one again.
Speaker Change: For the first question.
Amy Chen: Of course, questions come from Amy Chen from Citi. Please go ahead. Hi, this is Amy from Citi. Thank you for the opportunity for me to ask a couple of questions. And the first one would be regarding selling expenses. We noticed that the first year premium facilitated in the first quarter for around 15% year-over-year decline. However, selling expenses was up by 7%. What's the gap here?
Amy Chang: Our first question comes from Amy Chang from Citi. Please go ahead.
Dan Lee: Hi, This is Dan Lee from Citi. Thank you plenty of opportunity.
Dan Lee: A couple of questions.
Dan Lee: The first one will be regarding the selling expenses.
Speaker Change: Now does that also assume premium supplementation in first quarter.
Amy Chen: From 15% year over year.
Speaker Change: However, selling expenses by 7%.
Amy Chen: And the second question is on sales momentum in the second for the rest of 2025. The industry is expecting another round of pricing rate cut in the third quarter. Has this, you know, somehow boosted customer demand so far? Thank you.
Speaker Change: What's the gap here.
Speaker Change: Second question is on sales momentum in the second quarter and your outlook for the rest of two.
Speaker Change: 2025.
Speaker Change: The industry expecting another round of pricing rate cuts in the third quarter.
Speaker Change: Hudson.
Speaker Change: How boosted customer demand so far thank you.
Speaker Change: Yes.
Ron Tam: Thank you Amy, it's a pleasure to have you again on the call. So I know that you had three questions to you just now. So the first one is regarding the year-on-year decline on FYP versus an increase in expense, a sudden expense I believe, right? So I think to address the question on the FYP decline, I would note that in 2024, in the first quarter, there was a pricing cut effected during the quarter, which has also led to a rush sales during that quarter. So I think effectively we are comparing the first quarter of 2025 versus a relatively high base for the first quarter of last year.
Speaker Change: Thank you Amy.
Speaker Change: It's a.
Speaker Change: Pleasure to have you again on the call.
Speaker Change: So I know that you had three questions to Europe.
Speaker Change: Can you just now so the first one is regarding.
Speaker Change: The year on year decline in FY <unk> and.
Speaker Change: And versus eight increase in expense as that makes sense I believe.
Speaker Change: So I think to address the question on the FY <unk> FY <unk> decline I would note that.
Speaker Change: In June 24 in the first quarter. There was a it was a actually there was a pricing cut.
Ron Tam: In fact during the quarter, which has also led to sales during the quarter.
Speaker Change: So I think effectively we are comparing the first quarter of 2025 basis are relatively high base for the first quarter of last year. So I think that that has to do with it.
Ron Tam: So I think that has to do with a high base effect for 2024, albeit that in the first quarter of this year, we have further driven our revenue growth from not just domestic, but also from international markets. So that has to do with the reasons I just cited on the low base, high base effect of last year. And then on the gap between the FYP downturn and the you know, China caused it increased. I would note that the international business in terms of gross margins is relatively lower than the domestic business. And therefore, I think that has been reflected in what you noted in terms of the gross margin decline in the first quarter of 2024.
Speaker Change: Basically that for since April.
Speaker Change: In the first quarter of this year, we have.
Speaker Change: Japan, our revenue growth from not just domestic but also for international markets.
Speaker Change: So that has to do with them.
Speaker Change: The recent at the site.
Speaker Change: On the low base of high base effect of last year and then on the.
Speaker Change: The gap between the <unk>.
Speaker Change: Downturn Andy.
Speaker Change: In the channel conflict that increase.
Ron Tam: I would note that the.
Speaker Change: The international business It does of course margins.
Ron Tam: So that should be lower than the domestic business and therefore I think that as.
Speaker Change: Good people started in what.
Ron Tam: What you noted in terms of of course much of decline in the first quarter of between 35.
Ron Tam: So on your second question regarding the outlook for the rest of the year, we do think that Q1 for 2025 is probably the rock bottom for this year. In Q2, we are seeing, you know, very decent momentum. Obviously, the international market is still in high growth phase. And for domestic China market, also we are seeing a revival of growth, given that the transition to the power products has basically been complete over the last two quarters. And, you know, channels have, you know, have adjusted to the new product regime. So I think that in Q2, we're seeing growth across different products.
Speaker Change: So on your second question regarding the outlook for the rest of the year. We do think that Q1 for 2025 is probably the.
Speaker Change: Bottom for this year in Q2, we are seeing.
Speaker Change: Out of a decent momentum.
Speaker Change: Obviously the international market.
Speaker Change: The hydro face.
Speaker Change: Domestic China market also we are seeing a revival of growth.
Speaker Change: Given that the transition to the par products.
Speaker Change: Hess has basically been complete over the last two quarters.
Speaker Change: Channels.
Speaker Change: Adjusted to the new.
Speaker Change: So I think that in Q2, we are seeing.
Speaker Change: Growth in across different products and.
Ron Tam: But you know that, you know, the expectation for a further pricing rate cut in August 31st, which is now widely rumored and expected to be put in place, we do expect that there will be a, there will be an effect on rush sales in the third quarter, particularly in the months of July and August, where we have seen similar situations in the last year, and also in the past few years as well. Although we would note that the pricing rate at this time, because relatively speaking versus previous episodes, is relatively muted. And given that we're already in a sort of 2% handle kind of return level, the incitement for consumers to purchase would probably see a diluted effect versus what we've seen in the past years.
Speaker Change: You noted that the expectation for a further pricing rate cut.
Speaker Change: August 31, which is now widely rumoured and expect it to be put in place.
Speaker Change: Do expect that there'll be a.
Speaker Change: There will be an effect on west shelf in the third quarter, particularly in the months of July and August.
Speaker Change: Where we have seen similar situations in the last year.
Speaker Change: And also in the past two years as well.
Speaker Change: Although we would note that.
Speaker Change: The pricing at this time, because basically speaking versus previous episodes is relatively muted.
Speaker Change: Given that we already in a sort of 2% handle kind of return.
Speaker Change: Level.
Speaker Change: The.
Speaker Change: The incitement four for consumers to purchase a good policy a diluted.
Speaker Change: What we've seen in past years. So so we do expect that Q3 will be strong.
Ron Tam: So we do expect that Q3 will be strong, with August being the peak for domestic sales of, you know, savings products.
Speaker Change: With August being the peak.
Speaker Change: Domestic sales of.
Speaker Change: In our savings products.
Ron Tam: Hope that answers your question, Amy. Yeah, thank you. Thank you for the questions. One moment for the next question.
Speaker Change: I hope that answered your question Amy.
Amy Chang: Thank you.
Speaker Change: Thank you for the questions one of them, but for the next question.
Kenny Lim: Next question comes from the line of Kenny Lim of UOBKN. Please go ahead.
Speaker Change: Next question comes from the line of <unk>. Please go ahead.
Kenny Lim: Good evening Ron, I'm Kenny from UOB, and I have two questions for my aunt. First one, how do you expect the enforcement of power signals across the agency channels to affect your 2A business, and how does it change the overall industry competitive landscape?
Speaker Change: Good evening, Ron and Kenny from Dolby and bye.
Speaker Change: I have two question from my end.
Speaker Change: First one how do you expect the enforcement of policies across the a decision after a failure to a business and how does it change the overall industrial commodity basket.
Ron Tam: And my second question is about the latest international revenue contribution in first quarter, and also what is the latest progress of your business expansion plan in Singapore and Philippines? Thank you, Kenny. Thank you for the questions.
Speaker Change: And my second question is about the latest international revenue contribution in the first quarter.
Speaker Change: Is the later progressed after our business.
Speaker Change: <unk> plant in Singapore.
Speaker Change: Got it.
Speaker Change: Thank you Jamie.
Speaker Change: Okay.
Speaker Change: Alright.
Speaker Change: Two questions one on <unk> just the Deregulatory.
Speaker Change: ROE change impacting commissions for for various channels.
Speaker Change: Given that we have lived through this change that loss.
Speaker Change: Let's now and we do expect that the similar measures will be implemented aimed posed upon the tight agency channel, which you had noted in your question.
Speaker Change: If such a measure would be implemented in the second half. This year, we do expect that the so called impact on our business will be positive because what that means is that the playing field levels among the different channels.
Speaker Change: Our bank.
Speaker Change: In our focus and agencies pay agencies and therefore, we do expect that there'll be continued.
Speaker Change: <unk> exited of agents.
Speaker Change: From the tight agents agency model into independent third party platforms such as ourselves.
Speaker Change: So we would likely we'll be capturing an additional.
Speaker Change: Lots of <unk>.
Speaker Change: Active agents.
Speaker Change: It measure will be implemented on the agency channel.
Speaker Change: And on the overall market I would think that.
Speaker Change: The.
Speaker Change: Also because it will be will be it will be seen across our competitors as well.
Speaker Change: And as a whole in the market would continue to gravitate toward a more independent third party kind of broker agency distribution.
Speaker Change: Hello.
Ron Tam: We do note that right now in China. The third party intermediaries still account for less than 10% I think is still five six specific overall premium distribution.
Speaker Change: Versus what we see in more mature developed markets such as Japan.
Speaker Change: Hong Kong or Singapore.
Speaker Change: Where we see that the intermediary broker agency distribution is.
Speaker Change: As much as 30% to 50% the market. So in the long long term secular trend, we do see that the intermediation of Premier distribution will continue to be in favor of.
Speaker Change: Purpose, such as ourselves and.
Speaker Change: And the second point that I would note here is that we.
Speaker Change: We do see that.
Speaker Change: In the independent financial advisers and agents are increasingly favoring platform where they can.
Speaker Change: Access to a wide variety of products from different providers, such as ourselves we have been open to products on the platform that we can facilitate for agents to two to serve the customers and also especially the digital age whereby agents would require digital tools to serve our customers and to make sure that that because of a superb.
Speaker Change: Very efficient Ed and digital purchase journey.
Speaker Change: And for the likes of incumbents.
Speaker Change: May be a typical solutions will provide it.
Speaker Change: And where we have a face cleared so advantage on.
Speaker Change: On the competition. So so overall, we do but we do think that the impact will be positive.
Speaker Change: We would wait and see when the measures will be implemented on the agency channel.
Ron Tam: And the second question on international market expansion, we are very much on track into the oxygen into Singapore.
Speaker Change: We would likely be able to keep up with it.
Speaker Change: Material update in our next earnings call as to what our Singapore Department.
Speaker Change: As you know.
Speaker Change: S materialize into hopefully into an operational status by the third quarter.
Speaker Change: We're working very closely with regulators in the meantime to finalize arrangements and too.
Speaker Change: Let's make sure that all of our recruitment of necessary personnel.
Speaker Change: For the for the business is in is in place.
Speaker Change: <unk>.
Speaker Change: Part of it has to be in business.
Speaker Change: On this model.
Speaker Change: In the third quarter of this year.
Speaker Change: Philippines.
Speaker Change: Still progressing.
Speaker Change: Given that we are now prioritizing Singapore.
Speaker Change: This is development market, we likely will seek lipids in the second half this year.
Speaker Change: Thank you Kenny.
Speaker Change: Yeah.
Speaker Change: Okay.
Kenny Lo: With that, I'd like to hand the call back to Kenny for closing. Thank you, operator. In closing, on behalf of Huize's management team, we would like to thank you for your participation in today's call. If you require any further information, feel free to reach out to us. Thank you for joining us today.
Speaker Change: Thank you for the question.
Speaker Change: I'd like to hand, the call back to Ken.
Speaker Change: Thank you operator.
Speaker Change: Closing on behalf of <unk> management team, we would like to thank you for your participation in today's call. If you require any further information feel free to reach out to us. Thank you for joining US today. This concludes the call.
Operator: This concludes the call. That concludes today's conference call. Thank you for your participation.
Speaker Change: That concludes today's call.
Speaker Change: Thank you.
Operator: You may now disconnect.
Speaker Change: You may now disconnect.
Speaker Change: Okay.
Speaker Change: [music].
Speaker Change: Okay.
Operator: [music].
Speaker Change: Okay.
Speaker Change: [music].
Operator: Sure.
Speaker Change:
Speaker Change: [music].
Speaker Change: Yes.
Speaker Change: [music].