Q3 2025 Daqo New Energy Corp Earnings Call
Speaker #3: Hello and welcome to the Daqo new Energy . Third quarter 2020 results conference call . All participants will be in . Listen only mode .
Operator: Hello and welcome to the Daqo New Energy Corp. third quarter 2025 results conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing Star then zero on your telephone keypad. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press Star then one on your telephone keypad. To withdraw your question, please press Star then two. Please note this event is being recorded. I would now like to turn the conference over to Jessie Zhao, Investor Relations Director. Please go ahead.
Speaker #3: Should you need assistance , please signal a conference specialist by pressing star . Then zero on your telephone keypad . After today's presentation , there will be an opportunity to ask questions , to ask a question , you may press star , then one on your telephone keypad .
Speaker #3: To withdraw your question , please press star . Then two . Please note this event is being recorded . I would now like to turn the conference over to Jessie Zhao Investor Relations Director .
Speaker #3: Please go ahead .
Speaker #4: Hello everyone . I'm Jessie , the Investor relations director of Taco New Energy . Thank you for joining our conference call today . New just issued its financial results for the third quarter of 2025 , which can be found on our website at w-w-w-what .
Jessie Zhao: Hello everyone. I'm Jessie Zhao, the Investor Relations Director of Daqo New Energy Corp. Thank you for joining our conference call today. Daqo New Energy Corp. just issued its financial results for the third quarter of 2025, which can be found on our website at www.dqsolar.com. Today, attending the conference call, we have our Deputy CEO, Ms. Anita Zhu, our CFO, Ms. Ming Yang, and myself. Our Chairman and CEO, Mr. Xiang Xu, is on a business trip now, so Ms. Anita Zhu will deliver our management remarks on behalf of Mr. Xu. Today's call will begin with an update from Ms. Zhu on market conditions and company operations, and then Ms. Yang will discuss the company's financial performance for the quarter. After that, we will open the floor to Q&A from the audience.
Speaker #4: Today , attending the conference call , we have our deputy CEO , Miss Anita Zhu , our CFO , Miss Ming Yang , and myself , our chairman and CEO , Mr. Xiang Xu is on a business trip now .
Speaker #4: So, Miss Anita Zhu will deliver our remarks on behalf of Mr. Xiang Xu. Today's call will begin with an update on market conditions and company operations.
Speaker #4: And then Mr. Yang will discuss the company's financial performance for the quarter. After that, we will open the floor to Q&A from the audience.
Speaker #4: Before we begin with the formal remarks , I would like to remind you that certain statements on today's call , including expected future operational and financial performance and industrial growth , are forward looking statements that are made under the safe harbor provisions of the US Private Security Litigation Reform Act of 1995 .
Jessie Zhao: Before we begin with the formal remarks, I would like to remind you that certain statements on today's call, including expected future operational and financial performance and industrial growth, are forward-looking statements that are made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement. Further information regarding these and other risks is included in the reports or documents we have filed with or furnished to the Securities and Exchange Commission. These statements only reflect our current and preliminary view as of today and may be subject to change. Our ability to achieve these projections is subject to risks and uncertainties.
Speaker #4: These statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statements.
Speaker #4: For further information regarding these and other risks, please refer to the reports or documents we have filed with or furnished to the Securities and Exchange Commission.
Speaker #4: This statement only reflects our current and preliminary view as of today and may be subject to change. Our ability to achieve these projections is subject to risks and uncertainties.
Speaker #4: All information provided in today's call is as of today, and we undertake no duty to update such information except as required under applicable law.
Jessie Zhao: All information provided in today's call is as of today and we undertake no duty to update such information except as required under applicable rule. Also, during the call, we will occasionally reference monetary amounts in U.S. Dollar terms. Please keep in mind that our functional currency is the Chinese RMB. We offer these translations into U.S. Dollars solely for the convenience of the audience. Now I will turn the call to our Deputy CEO, Ms. Anita Zhu. Ms., go ahead.
Speaker #4: Also, during the call, we will occasionally reference monetary amounts in U.S. dollar terms. Please keep in mind that our functional currency is the Chinese RMB.
Speaker #4: We offer these translations into U.S. dollars solely for the convenience of the audience. Now, I will turn the call over to our Deputy CEO, Miss Anita Zhu.
Speaker #4: Miss, please go ahead. Hello, everyone.
Anita Zhu: Hello everyone, this is Anita Zhu. I'll now deliver our management remarks on behalf of Daqo New Energy Corp. With the recovery of market prices across the solar PV value chain in the third quarter of 2024, we believe the industry is gradually recovering from its cyclical downturn. In particular, the polysilicon segment reached an inflection point during the quarter, with prices rebounding significantly as a result.
Speaker #5: This is I'll now deliver our management remarks on behalf of our CEO , Mr. Xu . So , with the recovery of market prices across the solar PV value chain , the third quarter of 2025 , we believe the industry is gradually recovering from its cyclical downturn in particular , the polysilicon sector reached an inflection point during the quarter , with prices rebounding significantly as a result .
Speaker #5: We're pleased to report that for the third quarter , new recorded positive Anita . Evita of 45.8 million US dollars , as well as adjusted net income of 3.7 million USD .
Jessie Zhao: We're pleased to report that for the.
Anita Zhu: Third quarter, Daqo New Energy Corp. recorded positive EBITDA of $45.8 million as well as adjusted net income of $3.7 million. Moreover, our strong balance sheet is further reinforced. As of September 30, 2025, the Company had cash balance of $552 million, short term investments of $431 million, bank notes receivables balance of $157 million, and total fixed term bank deposit balance of $1.1 billion. In total, our bank deposit and financial investment assets readily convertible into cash if needed at $2.21 billion, representing an increase of $148 million compared to the end of the second quarter. Our solid financial foundation provides us with confidence and strategic flexibility to navigate the ongoing market recovery and capture long term opportunities. Operationally, the Company implemented proactive measures to counteract the continued market oversupply, maintaining a nameplate capacity utilization rate of 40%.
Speaker #5: Moreover, our strong balance sheet was further reinforced as of September 30, 2025. The company had a cash balance of $552 million.
Speaker #5: Short term investments of 431 million bank notes . Receivables balance of 157 million and total fixed term bank deposit balance of 1.1 billion USD .
Speaker #5: In total, our bank deposit and financial investment assets are readily convertible into cash if needed, at $2.21 billion, representing an increase of $148 million compared to the end of the second quarter.
Speaker #5: Our solid financial foundation provides us with confidence and strategic flexibility to navigate the ongoing market recovery and capture long term opportunities . Operationally , the company implemented proactive measures to counteract the continued market oversupply , maintaining a nameplate capacity , utilization rate of 40% .
Speaker #5: Total polysilicon production for the quarter was 30,650 . Metric ton , slightly above our guidance range of 27 to 30,000 metric tons . We also capitalized on favorable pricing conditions to sell not only our current quarters output , but also significant portion of our existing inventory , leading to a sharp rise in a serious volume to 42,406 metric tons from 18,126 metric ton in the previous quarter .
Anita Zhu: Total polysilicon production for the quarter was 30,650 metric ton, slightly above our guidance range of 27,000 to 30,000 metric ton. We also capitalized on favorable pricing conditions to sell not only our current quarter's output but also significant portion of our existing inventory, leading to a sharp rise in our sales volume to 42,406 metric ton from 18,126 metric ton in the previous quarter. The strong increase in sales volume reflects both our customers' confidence in Daqo's product quality and their continued preference for our product in the new pricing environment. As a result, our sales volume far exceeded production, bringing our inventory down to a healthy level. Another positive note, production costs declined significantly during the third quarter. Extending our ongoing cost reduction trend, total production cost declined by 12% to $6.38 per kg in Q3 2025 from $7.26 per kg in the second quarter of 2025.
Speaker #5: The strong increase in sales volume reflects both our customers' confidence in Daqo's product quality and their continued preference for products in the new pricing environment.
Speaker #5: As a result , our sales volume far exceeded production , bringing our inventory down to a healthy level . Another positive note production costs declined significantly during the third quarter , extending our ongoing cost reduction trend .
Speaker #5: Total production costs declined by 12% to 6.38 USD per kilogram in Q3 2025 , from 7.26 US dollar per kilogram in the second quarter of 2025 .
Speaker #5: Total idle facility related costs , primarily non-cash depreciation expenses , also fell to 1.18 in Q3 from 1.38 in Q2 , driven by higher production levels .
Anita Zhu: Total idle facility related costs, primarily non-cash depreciation expenses, also fell to $1.18 in Q3 from $1.38 in Q2, driven by higher production levels. In particular, our cash cost decreased by 11% from $5.12 per kilogram in Q2 to $4.54 per kilogram in Q3, the lowest in the Company's history. Cash cost includes approximately $0.16 per kilogram of idle facility maintenance related costs. In light of the current market conditions, we expect our total polysilicon production volume in the first quarter of 2025 to be approximately 39,500 metric tons to 42,500 metric tons. As a result, we anticipate our full year 2025 production volume to be in the range of 121,000 to 124,000 metric tons at the industry level. According to industry statistics, monthly supply of polysilicon in Q3 remained in the range of approximately 100,000 to 130,000 metric tons.
Speaker #5: In particular , our cash costs decreased by 11% from 5.212 US dollar per kilogram in Q2 to 4.54 US dollar per kilogram in Q3 .
Speaker #5: The lowest in the company's history . Cash costs includes approximately 0.16 US dollar per kilogram of idle facility maintenance related costs . In light of the current market conditions , we expect our total polysilicon production volume in the first quarter of 2025 to be approximately 39,500 metric tons to 42,500 metric tons .
Speaker #5: As a result , we anticipate our full year 2025 production volume to be in the range of 121 to 1 24,000 metric tons at the industry level , according to industry statistics , monthly supply of polysilicon in Q3 remained in the range of approximately 100,000 to 1 30,000 metric tons .
Speaker #5: On September 24th , president XI announced China's new 2035 environmental targets . At the UN climate summit . These targets include increasing the share of non-fossil fuels in total energy consumption to over 30% , and expanding the installed capacity of wind and solar power to over six times the 2020 level .
Anita Zhu: On September 24, President Xi announced China's new 2035 environmental targets at the UN Climate Summit. These targets include increasing the share of non-fossil fuels in total energy consumption to over 30% and expanding the installed capacity of wind and solar power to over six times the 2020 level, aiming to reach an accumulative capacity of 3,600 gigawatts by 2035. The official announcement reinforced China's ambitious strategy to transition toward a new low carbon energy structure, with solar PV playing a pivotal role in the process. Entering the third quarter, China's anti-involution initiative to restrict low price competition in the polysilicon sector continues to impact the industry market. Expectations of consolidation and tighter supply have improved overall industry fundamentals.
Speaker #5: Aiming to reach an accumulative capacity of 3,600 gigawatts by 2035, the official announcement reinforced China's ambitious strategy to transition toward a new low-carbon energy structure, with solar PV playing a pivotal role in the process.
Speaker #5: Entering the third quarter, China's anti-invasion initiative to restrict low-price competition in the polysilicon sector continued to impact the industry. Market expectations of consolidation and tighter supply have improved overall industry fundamentals.
Speaker #5: In particular , on August 19th , the Ministry of Industry and Information Technology , the Central Ministry of Social Work . The NDRC , the State Council .
Anita Zhu: In particular, on August 19, the Ministry of Industry and Information Technology, the Central Ministry of Social Work, the NDRC, the State Council, State-Owned Assets Administration Commission, the General Administration of Market Supervision, and the National Energy Administration jointly held a symposium on the photovoltaic industry. The meeting emphasized the need to strengthen industrial regulation, curb disorderly low price competition, standardize product quality, and promote industry self-discipline. On September 16, the Standardization Administration of China released a draft of a new mandatory national standard setting energy consumption limits per unit of polysilicon production. Once implemented, poly manufacturers with unit energy consumption higher than 6.4 kg must implement corrective improvements within a specified period. Those failing to comply or meet the entry threshold after rectification will be ordered to cease operations.
Speaker #5: The State-Owned Assets Administration Commission, the General Administration of Market Supervision, and the National Energy Administration jointly held a symposium on the photovoltaic industry.
Speaker #5: The meeting emphasized the need to strengthen industrial regulation , curb disorderly low price competition , standardized product quality , and promote industry self-discipline .
Speaker #5: On September 16th, the standardization and administration of China released the draft of a new mandatory national standard, setting energy consumption limits per unit of polysilicon production.
Speaker #5: Once implemented poorly, manufacturers with unit energy consumption higher than 6.4 kg must implement corrective improvements within a specified period. Those failing to comply or meet the entry threshold after rectification will be ordered to cease operations.
Speaker #5: According to China's Silicon Industry Association, China's effective capacity and polysilicon production are expected to climb to 2.4 million metric tons per year.
Anita Zhu: According to China's Silicon Industry Association, China's effective capacity of polysilicon production is expected to climb to 2.4 million metric tons per year, a decrease of 16.4% from the end of 2024 and of 31.4% from total installed production capacity. We expect that implementation of this new energy consumption standard will substantially ease the issue of industry overcapacity. As a result of these more fossil measures, polysilicon prices rose sharply to ¥45 to ¥49 per kg in July, from ¥32 to ¥35 per kg in June, and a further climb to ¥49 to ¥55 per kg at the end of the quarter. The solar PV industry continues to demonstrate strong long-term growth prospects in the medium term. We believe that the combination of industry self-discipline and government anti-involution regulations will help foster a healthier and more sustainable industry in the long run.
Speaker #5: A decrease of 16.4% from the end of 2020 . Four . And of 31.4% from total installed production capacity . We expect the implementation of this new energy consumption standard was substantially ease .
Speaker #5: The issue of industry overcapacity. As a result of these more forceful measures, policy prices rose sharply to 45 to 49 RMB per kilogram in July from 32 to 35 RMB per kilogram in June, and further climbed to 49 to 55 RMB per kilogram at the end of the quarter.
Speaker #5: The solar PV industry continues to demonstrate strong long-term growth prospects, both in the medium term and the long term. We believe that the combination of industry self-discipline and government entity involvement regulations will help foster a healthier and more sustainable industry in the long run.
Speaker #5: As one of the most cost-effective and sustainable energy sources globally, solar power is expected to remain a key driver of the global energy transition and sustainable development.
Anita Zhu: As one of the most cost-effective and sustainable energy sources globally, solar power is expected to remain a key driver of the global energy transition and sustainable development. Looking ahead, Daqo New Energy Corp. is well positioned to capture the long-term growth in the global solar PV market and further strengthen its competitive edge by enhancing its higher efficiency N-type technology and optimizing its cost structure through this digital transformation and AI adoption. As one of the world's lowest cost producers of the highest quality N-type product and with a strong balance sheet and no bank loan, we're confident in our ability to capitalize on the market recovery and emerge as an industry leader well positioned to seize future growth opportunities. Now I'll turn the call to our CFO, Mr. Ming Yang, who will discuss the company's financial performance for the quarter. Please go ahead.
Speaker #5: Looking ahead, Daqo New Energy is well positioned to capture the long-term growth in the global solar PV market and further strengthen its competitive edge by enhancing its higher efficiency and type, technology, and optimizing its cost structure.
Speaker #5: Through digital transformation and AI adoption . As one of the world's lowest cost producers of the highest quality and type products , and with a strong balance sheet and no bank loan , we're confident in our ability to capitalize on the market recovery and emerge as an industry leader .
Speaker #5: Well positioned to seize for future growth opportunities . So now I'll turn the call to our CFO , Mr. Ming Yang , who will discuss the company's financial performance for the quarter .
Speaker #5: Ma'am, please go ahead.
Speaker #6: Thank you . Anita , and hello , everyone . This is Ming Yang , CFO of DAQO NEW ENERGY CORP. . We appreciate you joining our earnings conference call today .
Ming Yang: Thank you Anita and hello everyone, this is Ming Yang, CFO of Daqo New Energy Corp. We appreciate you joining our earnings conference call today. I will now go over the company's third quarter 2025 financial performance. Revenues were $244.6 million compared to $75.2 million in the second quarter of 2025 and $198.5 million in the third quarter of 2024. The increasing revenue compared to the second quarter of 2025 was primarily due to an increase in both sales volume and average selling price. Gross profit was $9.7 million compared to gross loss of $81 million in the second quarter of 2025 and gross loss of $60.6 million in the third quarter of 2024. Gross margin was 3.9% compared to negative 108% in the second quarter of 2025 and negative 30% in the third quarter of 2024.
Speaker #6: I will now go over the company's third quarter 2025 financial performance. Revenues were $244.6 million compared to $75.2 million in the second quarter of 2025.
Speaker #6: $98.5 million in the third quarter of 2024. The increase in revenue compared to the second quarter of 2025 was primarily due to an increase in both sales volume and average selling price.
Speaker #6: Gross profit was $9.7 million compared to a gross loss of $81 million in the second quarter of 2025 and a gross loss of $60.6 million in the third quarter of 2024.
Speaker #6: Gross margin was 3.9% compared to -1.8% in the second quarter of 2025 and -30% in the third quarter of 2024 . The increase in gross margin compared to the second quarter of 2025 was primarily due to the increase in the average selling prices of polysilicon , a decrease in our production costs , as well as write offs of provision for inventory impairment .
Ming Yang: The increase in gross margin compared to the second quarter of 2025 was primarily due to the increase in the average selling prices of polysilicon, a decrease in our production cost as well as write off of provision for inventory impairments. Selling, general and administrative expenses were $32.3 million compared to $32.1 million in the second quarter of 2025 and $37.7 million in the third quarter of 2024. SG&A expenses during the third quarter included $18.6 million in non-cash share-based compensation costs related to the company share incentive plan compared to $18.6 million in the second quarter of 2025. R&D expenses were $0.6 million compared to $0.8 million in the second quarter of 2025 and $0.8 million in the third quarter of 2024. R&D expenses vary from period to period and reflect R&D activities that take place during the quarter.
Speaker #6: Selling, general and administrative expenses were $32.3 million, compared to $32.1 million in the second quarter of 2025 and $37.7 million in the third quarter of 2024.
Speaker #6: Expenses during the third quarter included $18.6 million in non-cash share-based compensation costs related to the company's share incentive plan, compared to $18.6 million in the second quarter of 2025.
Speaker #6: R&D expenses were $0.6 million, compared to $0.8 million in the second quarter of 2025 and $0.8 million in the third quarter of 2020.
Speaker #6: For . R&D expenses vary from period to period , reflect R&D activities that take place during the quarter . As a result of the foregoing .
Ming Yang: As a result of the foregoing, loss from operations was $20.3 million compared to $115 million in the second quarter of 2025 and $98 million in the third quarter of 2024. Operating margin was negative 8% compared to negative 153% in the second quarter of 2025 and negative 49% in 2024. Net loss attributable to Daqo New Energy Corp. shareholders was $14.9 million compared to $76.5 million in the second quarter of 2025 and $60.7 million in the third quarter of 2024. Loss per basic ADS was $0.22 compared to $1.14 in the same quarter of 2025 and $0.92 in the third quarter of 2024. Adjusted net income attributable to Daqo New Energy Corp. shareholders, excluding non-cash share-based compensation costs, was $3.7 million compared to adjusted net loss attributed to Daqo New Energy Corp.
Speaker #6: Loss from operations was $20.3 million, compared to $115 million in the second quarter of 2025 and $98 million in the third quarter of 2024.
Speaker #6: Operating margin was negative 8% compared to -153% in the second quarter of 2025 and -49% in the third quarter of 2024. Net loss attributable to Daqo New Energy shareholders was $14.9 million, compared to $76.5 million in the second quarter of 2025 and $60.7 million in the third quarter of 2024.
Speaker #6: Loss per basic ADS was $0.22, compared to $1.14 in the second quarter of 2025 and $0.92 in the third quarter of 2024.
Speaker #6: Adjusted net income attributable to Daqo New Energy Corp. shareholders, excluding non-cash share-based compensation costs, was $3.7 million compared to an adjusted net loss attributable to shareholders of $57.9 million in the second quarter of 2025 and $39.4 million in the third quarter of 2024.
Ming Yang: shareholders of $57.9 million in the second quarter of 2025 and $39.4 million in the third quarter of 2024. Adjusted Earnings Per Basic ADS was $0.05 per share compared to Adjusted Loss Per Basic ADS of $0.86 in the second quarter of 2025 and $0.59 in the third quarter of 2024. EBITDA was $45.8 million compared to negative $48 million in the second quarter of 2025 and negative $34 million in the third quarter of 2024. EBITDA margin was 18.7% compared to negative 64% in the second quarter of 2025 and negative 17% in the third quarter of 2024. Now on the company's financial condition as of September 30, 2025, the company had $551.6 million in cash, cash equivalents, and restricted cash compared to $598.6 million as of June 30, 2025, and $853 million as of September 30, 2024.
Speaker #6: Adjusted earnings per basic ADS was $0.05 per share, compared to an adjusted loss per basic ADS of $0.86 in the second quarter of 2025 and $0.59 in the third quarter of 2024.
Speaker #6: EBITDA was $45.8 million compared to -$48 million in the second quarter of 2025 and -$34 million in the third quarter of 2024. EBITDA margin was 18.7% compared to -64% in the second quarter of 2020.
Speaker #6: Five and -17% in the third quarter of 2024 . Now , on the company's financial condition . As of September 30th , 2025 , the company had $551.6 million in cash .
Speaker #6: Cash equivalents and restricted cash , compared to $598.6 million as of June 30th , 2025 and $853 million as of September 30th , 2024 , and as of September 30th , 2025 .
Ming Yang: As of September 30, 2025, short term investment was $431 million compared to $418.8 million as of June 30, 2025, and $245 million as of September 30, 2024. As of September 30, 2025, bank notes receivable balance was $157 million compared to $49 million as of June 30, 2025, and $83 million as of September 30, 2024. Notes receivable balance represents bank notes with maturity within six months. As of September 30, 2025, the balance of fixed term deposits within one year was $1.03 billion compared to $960.7 million as of June 30, 2025, and $1.2 billion as of September 30, 2024. Now on the company's cash flows for the nine months ended September 30, 2025, net cash used in operating activities was $50 million compared to $356 million in the same period of 2024.
Speaker #6: Short term investment was $431 million , compared to $418.8 million as of June 30th , 2025 , and 245 million as of September 30th , 2025 .
Speaker #6: As of September 30th , 2025 . Bank notes receivable balance was 157 million , compared to 49 million as of June 30th , 2025 and 83 million as of September 30th , 2024 .
Speaker #6: Note receivable balance represent bank notes with maturity within six months and as of September 30th , 2025 , the balance of fixed term deposits within one year was 1.3 billion , compared to 960.7 million as of June 30th , 2025 , and 1.2 billion as of September 30th , 2024 .
Speaker #6: Now , on the company's cash flows for the nine months ended September 30th , 2025 , net cash used in operating activities was 50 million , compared to 356 million in the same period of 2024 .
Speaker #6: And for the nine months ended September 30, 2025, net cash used in investing activities was $448.9 million, compared to $1.7 billion in the same period of 2024.
Ming Yang: For the nine months ended September 30, 2025, net cash used in investing activities was $448.9 million compared to $1.7 billion in the same period of 2024. The net cash used in investing activities in 2025 includes $120.3 million for the purchase of PPG and $328.6 million in net purchase of short term investments and fixed. For the nine months ended September 30, 2025, net cash used in financing activities was $32,000 compared to $48.5 million in the same period of last year. That concludes our prepared remarks. We will now open the call to Q and A from the audience. Operator, please begin. We will now begin.
Speaker #6: The net cash used in investing activities in 2025 includes $120.3 million for the purchase of PPE and $328.6 million in net purchases of short-term investments at fixed-term deposits for the nine months ended September 2025.
Speaker #6: Net cash used in financing activities was $32,000, compared to $48.5 million in the same period of last year. And that concludes our prepared remarks.
Speaker #6: We will now open the call to Q&A from the audience. Operator, please begin.
Speaker #3: We will now begin the question and answer session . To ask a question , you may press star . Then one on your telephone keypad .
Operator: The question and answer session. To ask a question, you may press Star then one on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press Star then two. At this time, we will pause momentarily to assemble our roster. The first question comes from Philip Shen with Roth Capital Partners. Please go ahead.
Speaker #3: If you're using a speakerphone, please pick up your handset before pressing the keys. If at any time your request has been addressed and you would like to withdraw your question, please press star, then two.
Speaker #3: At this time, we will pause momentarily to assemble our roster. The first question comes from Phillip Chen with Roth Capital Partners.
Speaker #3: Please go ahead .
Speaker #7: Hi, everyone. Thank you for taking my questions. My first one is on the gross margins. It looks like you guys had positive gross margins for the first time in a while.
[Analyst 3]: Hi everyone. Thank you for taking my questions. First one is on the gross margins. Looks like you guys had positive gross margins for the first time in a while, maybe supported by the impairment, and so wanted to get a feel for what kind of could we see positive gross margins in Q3 and or Q4, and how would you expect that to trend in 2026? Thanks.
Speaker #7: Maybe supported by the impairment. And so, I wanted to get a feel for what kind of positive gross margins we could see in Q3 and Q4.
Speaker #7: And how would you expect that to trend in 2026? Thanks.
Speaker #6: Hello . This is Ming . The CFO . Thanks for your question . And we're very pleased to report that we were able to record a positive , gross margin for the third quarter .
Ming Yang: Hello Phil, this is me, Ming Yang, the CFO. Thanks for your question. We're very pleased to report that we were able to record positive gross margin for the third quarter. A lot of it is driven by the increase in selling prices, the quite significant increase that we saw in Q3, as well as a significant reduction in our per unit cost, and also helped by some of the benefits from an earlier write down of inventory. We do expect that our Q4 gross margin as of today should be positive as well. Should be positive. I think based on our current expectation for trends for both ASP as well as for our cost, continued cost reduction as well.
Speaker #6: A lot of it is driven by the increase in selling prices, the quite significant increase that we saw in Q3, and as well as a significant reduction in our per unit costs.
Speaker #6: And also helped by some of the benefits from an earlier write-down of the inventory. But we do expect that our Q4 gross margin, as of today, should be positive as well.
Speaker #6: It should be positive. I think based on our current expectations for the trend, both for ASP as well as for our costs, we continue to see cost reduction as well.
Speaker #7: Great. Thanks. And so maybe Q3 remains negative, Q4 flips positive, and then through 2026 do you see potential for the year to be positive as well?
[Analyst 3]: Great, thanks Bing. Maybe Q3 remains negative, Q4 flips positive, and then through 2026, do you see potential for the year to be positive as well?
Speaker #6: As of today? Yes.
Ming Yang: As of today, yes.
Speaker #7: Okay .
Speaker #8: Great .
[Analyst 3]: Okay, great. Shifting over to some bigger picture questions. Last week we hosted a couple of webinars, one with Clean Energy Associates and the other one with the CRU Group, the Commodities Research unit that acquired Exawatt based out of London. In any case, they were talking about a lot of the overhaul efforts and the anti-involution measures in China for polysilicon and downstream. They were saying that even after the overhaul in the polysilicon segment, there could still be, instead of maybe 3x overcapacity for poly, now just 2x. Still substantial overcapacity. How do you guys continue to work to better match capacity with the lower levels of demand? What other actions can you and the industry take? How much capacity might you and the industry acquire over time and then shut down? Thanks.
Speaker #7: Shifting over to some bigger picture questions. Last week, we hosted a couple of webinars: one with Clean Energy Associates and the other one with the Crew Group.
Speaker #7: The commodities Research Unit that acquired Exo . What based out of London . In any case , they were talking about a lot of the overhaul efforts and and the antievolution efforts and China for polysilicon and downstream .
Speaker #7: But they’re saying that even after the overhaul in the polysilicon segment, there could still be, instead of maybe three times overcapacity for poly.
Speaker #7: Now, just two x. So still substantial overcapacity. How do you guys continue to work to better match capacity with the lower levels of demand?
Speaker #7: What other actions can you and the industry take? And then, how much capacity might you and the industry acquire over time? And then, shut down?
Speaker #7: Thanks .
Speaker #5: Thank you Phil . So regarding the overall capacity , first of all , I think it's correct that even with the exit of some capacity , there would still be a relative oversupply compared to demand .
Anita Zhu: Thank you, Phil. Regarding the overall capacity, first of all, I think it's correct that even with the exit of subcapacity, there would still be a relative oversupply compared to demand. However, I think how it's going to work is that although you still have more supply in terms of the nameplate capacity, they'll try to balance with demand in terms of the production volume. Meaning none of the companies will be operating at full utilization rate until demand climbs up again. I think that's what's going to happen at least in the short term to the midterm.
Speaker #5: However, I think how it's going to work is that, although you still have more supply in terms of the nameplate capacity, they'll try to balance it with demand in terms of the production volume. This means none of the companies will be operating at full utilization rate until demand climbs up again.
Speaker #5: I think that's what's going to happen , at least in the short term , to the to the mid-term .
Speaker #7: Okay . Got it . Thank you . And . Do we or are you guys expect any additional actions from the government or from the industry that maybe were not all aware of that could also serve as positive catalyst ?
[Analyst 3]: Okay, got it. Thank you. Do you or do you guys expect any additional actions from the government or from the industry that maybe we're not all aware of that could also serve as a positive catalyst in addition to the lower utilization rate? What else can you and the industry and the government do? Thanks.
Speaker #7: You know , in addition to the lower utilization rate , what else can you and the industry and the government do ? Thanks .
Speaker #5: I think the overall conversation on the consolidation in terms of the SPV, but that all the investors have seen a lot of news around that.
Anita Zhu: I think the overall conversation on the consolidation in terms of the solar PV industry, I bet that all investors have seen a lot of news around that. I would say the anti-involution measures are still ongoing and conversations. All the companies are taking the initiative to participate and are actively engaging in these conversations so that we would see a healthier and more sustainable industry going forward. I think that's the key focus right now, at least in the near term. I would say aside from the anti-involution measures in terms of the consolidation, the other one that might be worthy to mention is the draft on the new mandatory national standard. I think that would work as another positive catalyst.
Speaker #5: I would say the anti-initiatives are still ongoing, and conversations among all the companies are taking the initiative to participate and are actively engaging in these discussions.
Speaker #5: So that we would see a healthier and more sustainable industry going forward. And I think that's the key focus right now, at least in the near term.
Speaker #5: And I would say, aside from the anti-evolution, in terms of the consolidation, the other one that might be worthy to mention is the draft on the new mandatory national standard rate.
Speaker #5: I think that would work as another positive catalyst. While the consolidation conversation is still ongoing, the government is also pushing on the national standard on energy consumption, and that would serve as a hard cutoff point for some of the industries or for some of the companies in the industry.
Anita Zhu: While the consolidation conversation is still ongoing, the government is also pushing out the national standard on energy consumption and that would serve as a hard cutoff point for some of the companies in the industry.
Speaker #7: Okay , great . Thank you for the color , Anita . I'll pass it on .
[Analyst 3]: Okay, great. Thank you for the color, Anita. I'll pass it on.
Speaker #3: The next question comes from Alan Lao with Jefferies. Please go ahead.
Operator: The next question comes from Alan Lau with Jefferies. Please go ahead.
Speaker #9: Thank you a lot for taking my question. Anytime. My first question would be to follow up on sales. I have a question on self-discipline in the industry.
[Analyst 1]: Thanks a lot for taking my question. Ming, first question. Would like to follow up on Phil's question on the self discipline in the industry. Would like to know if.
Speaker #9: I would like to know, is there a timeline for when you expect the whole consolidation agreement among the remaining players will be signed? And what exactly, in terms of mechanisms, will be put in place to ensure that the players adhere to the quota or the volumes that are agreed upon by the parties? Are there any performance bonds or some kind of mechanisms like that?
[Analyst 4]: When do.
[Analyst 1]: You expect the whole consolidation agreement among the remaining players will be signed, and what exactly in terms of mechanisms to make sure the players obey the quota or the volumes that are agreed upon by the part. Is there any performance bond or some kind of mechanism?
Speaker #5: Thank you . Alan . So of course , like I just mentioned , the conversation are still ongoing . So we're waiting for more details before we can unveil it to to the investors .
Anita Zhu: Thank you, Alan. Like I just mentioned, the conversations are still ongoing. We're waiting for more details before we can unveil it to the investors. I would say we're pushing toward meeting or having a consensus in terms of the consolidation, and it's difficult for us to say exactly when that's going to turn out or when we can see an agreement sign. Of course, from our perspective, the sooner the better, right? We have seen a price recovery in the third quarter already. Suppose we can get a consolidation done soon, we might see further uptick in the prices. Of course, because there are many parties involved in working out the consolidation, including the government entities and the companies in the industry, it's taking some time. We are working very diligently and working very hard toward having a consensus.
Speaker #5: But I would say we're pushing toward meeting that or having a consensus in terms of the consolidation. It's difficult for us to say exactly when that's going to turn out or when we can see an agreement signed.
Speaker #5: But of course , from our perspective , the sooner the better , right ? So that of course , we've seen a price recovery in the third quarter already .
Speaker #5: But suppose we can get a consolidation done sooner. We might see a further uptick in the prices, yeah. But of course.
Speaker #5: Because there are many parties involved in working out the consolidation , including the government entities and the companies in the industry . So it's taking some time .
Speaker #5: But of course , we are working very diligently and working very hard toward having a consensus .
Speaker #9: Thank you. So my second question is to follow up on the company's specific method. I have noticed that the AIP achieved by the company is quite high relative to peers. I would like to know what your expectation is on the prices, especially if the consolidation initiative is implemented.
Ming Yang: Thank you.
[Analyst 1]: My second question is to follow up on the company specific matters. I have noticed that actually the ASP achieved by the company is quite high relative to peers. I would like to know what's your expectation on the prices, especially if the consolidation initiative is implemented. Secondly, also looked at from the cost perspective, both the production cost and the cash cost went down. How do you see the trend in Q4 or 2026 as.
Speaker #9: And then secondly, also looked at from a cost perspective, both the production costs and the cash cost went down. So how do you see the trend in Vacuo or in 2026 as well?
Speaker #5: Okay .
Speaker #6: Okay. I'll discuss the cost transfers, and then Anita will talk about the SP, especially what our expectation is after the consolidation initiative.
Ming Yang: Okay, I'll.
Anita Zhu: Adjust the.
Ming Yang: Cost trend first and then Anita will talk about the ASP, especially what our expectations after the consolidation initiative. We did see a significant reduction in cost for this quarter and it's actually better than what we had originally anticipated. Cost went down about 12% quarter over quarter. Overall cost and especially cash costs declined by more than 11% quarter over quarter. A significant portion of that is actually the reduction in energy usage around efficiency. We did a lot of efforts in terms of improving our process and for further optimization. We would say that a lot of those efforts actually begin to materialize, especially in the third quarter. As well as the usage of silicon powder in terms of per unit reduction and also this quarter we benefited additionally from a decline in slick metal pricing and also because of the increase in production.
Speaker #6: So we did see a significant reduction in costs for this quarter, and it's actually, I would say, better than what we had originally anticipated.
Speaker #6: So, costs went down about 12% quarter over quarter overall. Cash costs, in particular, declined by more than 11% quarter over quarter.
Speaker #6: A significant portion of that is actually the reduction in energy usage, particularly around efficiency. So, we did a lot of efforts in terms of improving our process and for further optimization.
Speaker #6: And I would say that a lot of those efforts actually begin to materialize , especially in the third quarter . And as well as the usage of silicon powder in terms of per unit reduction , and also this quarter , we benefited additionally from a decline in in silicon metal pricing and also because of .
Speaker #6: The increase in production . So this quarter , production is more than 10% higher than the previous quarter . So there's also a unit reduction in terms of relatively fixed costs .
Ming Yang: This quarter production is more than 10% higher than the previous quarter. There's also per unit reduction in terms of relatively fixed costs, for example labor and benefits. The combination of these helped us to reduce our cost. We actually expect currently expect Q4 cost to continue to decline compared to Q3, I think in the low single digit range. We should continue to see a low single digit percentage range. We should continue to see benefit from our cost reduction efforts.
Speaker #6: So for example , a labor and benefits . So the combination of these helped us to reduce our cost . And we actually expect currently expect a Q3 , Q4 cost to continue to decline compared to Q3 .
Speaker #6: I think in in the low single digit range . So we should continue to see a low single digit percentage range . So we should continue to see benefit from our cost reduction efforts .
Speaker #5: And in terms of the ASPs . So first of all , for the fourth quarter , as we're still undergoing the conversations to make the consolidation happen , we think the price range will remain at relatively stable at the current level because prices are has already picked up in the third quarter near the end of the quarter .
Anita Zhu: In terms of the ASPs, for the fourth quarter, as we're still undergoing the conversations to make the consolidation happen, we think the price change will remain relatively stable at the current level because prices have already picked up in the third quarter. Near the end of the quarter, it's already in a range of RMB 49 to RMB 55 per kilogram. We think that's going to sustain in the fourth quarter. However, after the consolidation is completed, of course the consolidation will be done in stages, so it's more likely going to be capacities exiting in different phases. We should expect prices to tick up after the consolidation happens, to rise around RMB 60 per kilogram and perhaps picking up further as we see more maintenance capacities exiting the industry, perhaps in a range of RMB 60 to RMB 80 as we foresee it.
Speaker #5: It's already in the range of 49 to 55 RMB per kilogram. So we think that's going to sustain in the fourth quarter.
Speaker #5: However , after the consolidation is completed , of course , the consolidation will be done in phases . So it's more likely going to be capacities exiting in different phases .
Speaker #5: And we do expect we should expect prices to tick up after the consolidation happens to rise around 60 RMB per kilogram . First .
Speaker #5: And perhaps taking up further as we see more nameplate capacities exiting the industry. So, perhaps in the range of 60 to 80, as we foresee it.
Speaker #9: Thank you. That's very clear. I think my last question is on the buyback, because the company has announced the buyback program a couple of months back.
Ming Yang: Thank you.
[Analyst 1]: That's just very clear. I think my last question is on the buyback because the company has announced the share repurchase program a couple of months back. We'd like to know the progress of buyback since then. Also, combining the consideration of potential CapEx or acquisition spending, we'd like to know what is the pace of buyback can be touched by the company. Thanks.
Speaker #9: I would like to know the progress of the buyback since then. Additionally, I would like to consider the potential CapEx or acquisition spending.
Speaker #9: Would you like to know what the pace of buybacks is, as emphasized by the company? Thanks.
Speaker #5: Thank you . Alan . So in terms of the share repurchase , after we announce the program , share price is actually increased to the highest to 31 USD , which was about 35% higher than what was near the end of August .
Anita Zhu: Thank you, Alan. In terms of the share repurchase, after we announced the program, share prices actually increased to the highest to $31, which was about 35% higher than what was near the end of August. Because we wanted to purchase more shares, we were waiting and monitoring the market closely. Another thing is that we were waiting to see what would be the initial investment for the consolidation.
Speaker #5: And because we wanted to . Purchase more shares . Right . So we were waiting and monitoring the market closely and another thing is that we were waiting to see what would be the initial investment for the consolidation .
Speaker #5: Right ? So suppose the initial investment is around 30 billion RMB versus 10 billion RMB . It means a huge difference to what we have to put in the consolidation .
[Analyst 4]: Right.
Anita Zhu: If the initial investment is around RMB 30 billion versus like RMB 10 billion, it will mean a huge difference to what we have to put in the consolidation. Hence, we're still waiting to see how that's going to unfold before we can confidently start the share repurchase again.
Speaker #5: Hence, we're still waiting to see how that's going to unfold before we can confidently start the share repurchase again.
Speaker #9: Okay, so assuming the consolidation effort will materialize in full, Q3 will probably provide more clarity on the amount that has to be spent on that platform.
[Analyst 1]: Okay, so assume the consolidation asset will materialize in Q4, then probably there will be more clarity on the amount that EQ has to spend in that platform, and then probably the company will start buyback probably in Q4 or in Q1 2025 next year.
Speaker #9: And then probably the company will start . Buyback probably in for . Q Q and next year . Right . Is it a fair expectation ?
Anita Zhu: Right.
[Analyst 1]: Is it a fair expectation?
Speaker #4: So so .
Jessie Zhao: Sorry, what's the question?
Speaker #5: What's the question ?
Speaker #9: So as soon . For the timing . So if it's the consolidation effort is going to be in for Q or Q , then DK will start buyback in right after that .
[Analyst 2]: So.
[Analyst 1]: It's on the timing. If the consolidation effort is going to be in Q4 or Q1, then Daqo New Energy Corp. will start buyback right after that, which is a couple of months.
Speaker #9: So, which is a couple of months from now.
[Analyst 3]: From now.
Speaker #5: In terms of the timing of the share repurchase .
Anita Zhu: In terms of the timing.
Jessie Zhao: Of the share repurchase?
Speaker #8: Yep .
Anita Zhu: Yes, I think that after we have a more clear picture of what the consolidation looks like, we can start the share repurchase.
Speaker #5: I think that after we have a clearer picture of what the consolidation looks like, we can start the share repurchase.
Speaker #9: Thank you. That's very clear. I'll pass on. Thanks a lot.
[Analyst 1]: Thank you, that's very clear. I'll pass on. Thanks a lot.
Speaker #5: Yeah. Thank you. Thank you, Alan.
Anita Zhu: Yeah, thank you, Alan.
Speaker #3: The next question comes from Meng Wang with Goldman Sachs. Please go ahead.
Operator: The next question comes from Mengwyn Wong with Goldman Sachs. Please go ahead.
Speaker #10: Yes . Thanks for taking my question . Anita and Yang . So my first question is regarding to the production cost . So maybe you just mentioned the lower cash cost is mainly due to our capacity upgrade .
[Analyst 4]: Yes, thanks for taking the question, Anita and Ming. My first question is regarding the production cost. Ming, you just mentioned the lower cash cost is mainly due to our capacity upgrade, therefore less energy usage now. I was wondering what's our unit electricity consumption per kg of the poly right now?
Speaker #10: So, therefore, less energy usage now. I was wondering, what's our unit electricity consumption per kilogram of the poly right now?
Speaker #6: Okay . So it's actually different for our to facilities . But generally it's in the range of 52 to 55 kilowatt hour or per kilogram .
Ming Yang: Okay, this is actually different for our two facilities, but generally it's in the range of 52 to 55 kilowatt hours per kilogram currently.
Speaker #6: Currently .
Speaker #10: Sure . That's clear . And my second question is regarding to the the production . So we raised our production plan by 30% plus in four Q from three Q level .
[Analyst 4]: Sure, that's clear. My second question is regarding the production. We raise our production plan by 30% plus in Q4 from Q3 level. The direction is really going against our peers. I was wondering how we fit our production left to current industry-wide production quota narratives and also what drives our more positive demand outlook into Q4? I think that's supposed to be a traditional weak demand season.
Speaker #10: So the direction is really going against with our peers . So I was wondering how we fit our production left to current industry wide production quota narratives .
Speaker #10: And also, what drives our more positive demand outlook into Q4? I think that's supposed to be a traditionally weak demand season.
Speaker #5: Thinking. And so I would say that we were among the first to start lowering our utilization rate to around 30% initially, right?
Anita Zhu: Thank you, Mullen. I would say that we were among the first to start lowering our utilization rate to around 30% initially.
Speaker #5: So I would say we have been very aggressive in doing that . However , as prices have recovered in the third quarter , and we do foresee a more optimistic outlook going forward with the consolidation .
Ming Yang: Right.
Anita Zhu: I would say we have been very aggressive in doing that. However, as prices have recovered in the third quarter, we do foresee a more optimistic outlook going forward with the consolidation. Also, the proposal on energy consumption, we do see the direction to curb the vicious competition in the industry. We are more confident in the future outlook and we have weighed our own current plan as well as in terms of the cost. If we increase our production volume now, we can further reduce our production cost. I think that's the logic behind raising our production plan in the fourth quarter.
Speaker #5: And also the proposal energy consumption . We do see the direction to curb the vicious competition in the industry , right . So we are more confident in the future outlook , and we have weighed our own current plan as well as in terms of the cost .
Speaker #5: If we increase our production volume now, we can further reduce our production costs. So I think that's the logic behind raising our production plan in the fourth quarter.
Speaker #10: So can we . And use the over 50% utilization as the guidance in of the production plan in 2026 ? And going forward ?
[Analyst 4]: Can we use the over 50% utilization as the guidance of the production plan in 2026 and going forward?
Speaker #6: I .
Speaker #5: Yeah, I think that would be a reasonable assumption for 2026.
Anita Zhu: Yeah, I think that will be a reasonable assumption for 2026. Sure, that's very clear.
Speaker #10: Sure . That's very clear . That's all my question . I will pass the question to the next investor . Thanks .
[Analyst 4]: That's all my question. I will pass the question to the next investors. Thanks.
Speaker #6: Okay .
Speaker #4: Thank you mom .
Ming Yang: Okay, thank you.
Speaker #3: The next question comes from Gordon Johnson with GE J Research. Please go ahead.
Operator: The next question comes from Gordon Johnson with GLJ Research. Please go ahead.
Speaker #11: Hey guys . Thanks for taking the question . So just a I guess number one , focusing on your your current production cost .
[Analyst 2]: Hey guys, thanks for taking the question. Just, I guess, number one, focusing on your current production costs. 638, I'm looking at what PV Insights is reporting for polysilicon prices in Q4 so far. 653. That would suggest a margin of 2%. When I look at the Guangzhou Futures Exchange, it has polysilicon prices right now, futures at like.
Speaker #11: 638 I'm looking at what PV insights is reporting for polysilicon prices in Q4 so far . 653 that would suggest the margin of 2% , but when I look at the stock , I'm sorry , futures exchange , it has polysilicon prices right now .
Speaker #11: Futures at like around 840 . So when we look at your your Q4 gross margin , are we looking at a margin similar to what you reported in the 2% range or something higher ?
Ming Yang: You know, around 840.
[Analyst 2]: When we look at your Q4 gross margin, are we looking at a margin similar to what you reported in the 2% range or something higher? I have a follow up.
Speaker #11: And then I have a follow-up. Thanks.
[Analyst 3]: Thanks.
Speaker #6: I think for for the poly futures market , you have to subtract by a 13% VAT . I think once you subtract that , I think you get maybe a ballpark five five high mid to high single digit kind of gross margin , something like that .
Ming Yang: I think for the poly futures market you have to subtract by a 13% VAT. I think once you subtract that, I think you get maybe a ballpark five mid to high single digit kind of gross margin, something like that. Let me just say just kind of a range of gross margins, maybe low to mid single digit kind of gross margin, I think based on the current market environment.
Speaker #6: So let me just say just kind of a range of gross margins , maybe low low to mid . Single digit kind of gross margin I think based on the current market environment .
Speaker #11: Okay . That's helpful . And then are you guys mentioned that you sold a lot out of inventory ? Is that done or will you continue that ?
Anita Zhu: Okay, that's helpful.
[Analyst 2]: You guys mentioned that you sold a lot out of inventory. Is that done or will you continue that? My last question is, given the new five year plan that's coming through in China, what is your expectation for solar installations writ large in China in 2026 versus 2025? Thanks again.
Speaker #11: And then my last question is , given the the new five year plan , that's coming through in China , what is your expectation for installation solar installations writ large in China in 2026 versus 2025 ?
Speaker #11: Thanks again for the questions.
Speaker #6: Okay , so I think in terms of sales , I think it is still a little bit early . Right ? So we're at the end of October .
Ming Yang: Okay, I think in terms of sales it is still a little bit early. Right. We're at the end of October. There are two more months to go by. I think based on our latest customer orders and order trends at this point we do anticipate that the overall sales volume for the quarter should be similar to our expected production volume. I think that's the baseline for our sales. We do also look for opportunities to sell down additional inventory. That's what the current market condition looks like.
Speaker #6: There's two more months to go by I think based on our latest customer orders and order trends , we at least at this point , we do anticipate that the overall sales volume for the quarter , it should be similar to our expected production volume .
Speaker #6: I think that's the baseline for for our sales . But we do also look for opportunities to to sell down additional inventory . So that's what the current market condition looks like .
Speaker #11: Okay. And then on total installs in China for next year versus this year. Thanks.
[Analyst 3]: Okay.
[Analyst 2]: On total installs in China for next year versus this year.
Anita Zhu: Thanks. For installation, we think it will be relatively stable or low single digit compared to this year because this year the forecast is in a range of around 220-250 GW for additional installations in China. I think for next year would be more likely in the range and perhaps for growth to around 270 to 280 gigawatts.
Speaker #5: And for installation, we think it will be relatively stable or in the low single digits compared to this year, because this year the forecast is in the range of around.
Speaker #5: I would say 220 to 2 50GW for additional installations in China . So I think for next year would be more likely in the range .
Speaker #5: And perhaps for growth to around, I would say 270 to 280 GW.
Speaker #11: Thank you .
Operator: Thank you.
Speaker #6: Great. Thanks for the.
Ming Yang: Great. Thanks for that.
Speaker #3: This concludes our question-and-answer session. I would like to turn the conference back over to Jessie Zhao for any closing remarks.
Operator: This concludes our question and answer session. I would like to turn the conference back over to Jessie Zhao for any closing remarks.
Speaker #4: Thank you everyone again for participating in today's conference call. Should you have any further questions, please don't hesitate to contact us.
Jessie Zhao: Thank you everyone again for participating in today's conference call. Should you have any further questions, please.
Anita Zhu: Don't hesitate to contact us.
Speaker #4: Thank you, and have an awesome day. Goodbye.
Jessie Zhao: Thank you and have an awesome day.
Anita Zhu: Goodbye.
Operator: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.