Q4 2025 VNET Group Inc Earnings Call

March 16, 2026

Operator 2: Hello, ladies and gentlemen. Thank you for standing by for the Q4 and full year 2025 Earnings Conference Call for VNET Group Incorporated. After management's prepared remarks, there will be a question and answer session. Please note the Chinese line is in listen-only mode. If you wish to ask questions, please dial in through the English line. Participants from our management include Ms. Sharon Liu, Rotating President, Mr. Peter Zhang, SVP of Operational Finance, and Ms. Xinyuan Liu, Head of Investor Relations for the company. Please note that today's conference call is being recorded. I'll now like to turn the call over to the first speaker today, Ms. Xinyuan Liu. Please go ahead.

Operator: Hello, ladies and gentlemen. Thank you for standing by for the Q4 and full year 2025 Earnings Conference Call for VNET Group Incorporated. After management's prepared remarks, there will be a question and answer session. Please note the Chinese line is in listen-only mode. If you wish to ask questions, please dial in through the English line. Participants from our management include Ms. Sharon Liu, Rotating President, Mr. Peter Zhang, SVP of Operational Finance, and Ms. Xinyuan Liu, Head of Investor Relations for the company. Please note that today's conference call is being recorded. I'll now like to turn the call over to the first speaker today, Ms. Xinyuan Liu. Please go ahead.

Xinyuan Liu: Thank you, operator. Hello, everyone, and welcome to our Q4 and full year 2025 Earnings Conference Call. Our earnings release was distributed earlier today, and you can find a copy on our IR website as well as on newswire services. Please note that today's call will contain forward-looking statements made under the safe harbor provisions of the US Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from our current expectations. For detailed discussions of these risks and uncertainties, please refer to our latest annual report and other documents filed with the SEC. VNET does not undertake any obligations to update any forward-looking statements, except as required under applicable laws. Please also know that VNET's earnings press release and this conference call include the disclosure of audited GAAP and non-GAAP financial measures.

Xinyuan Liu: VNET's earnings press release contains a reconciliation of the audited non-GAAP measures to the audited GAAP measures. A summary presentation, which we will refer to during this conference call, can be viewed and downloaded from our IR website at ir.vnet.com. Next, I'd like to alert you that we will be utilizing text-to-speech technology powered by Newlink.ai to deliver this quarter's prepared remarks by Ms. Sharon Xiao Liu, our Rotating President, and Mr. Peter Zhihua Zhang, our SVP of Operational Finance. The management team will join the Q&A session in person. Additionally, this conference is being recorded. A webcast of this conference call will also be available on our IR site at ir.vnet.com. Now let's get started with today's presentation. Ms. Liu, please go ahead.

Winners' earnings press release contains a reconciliation of the audited non-GAAP matters to the audited GAAP matters.

A summary presentation, which we will refer to during this conference call, can be viewed and downloaded from our IR website at

irvine.com.

Next, I'd like to alert you that we will be utilizing text-to-speech technology, powered by newlink.ai, to deliver these quarters' prepared remarks by Ms. Sharon Leo, our Rotating President, and Mr. Peter John, our SVP of Operational Finance.

The management team will join the Q&A session in person.

Additionally, this conference is being recorded. A webcast of this conference call will also be available on our website at irvine.com.

Now, let's get started with today's presentation. Miss Leo, please go ahead.

Sharon Xiao Liu: Good morning and good evening, everyone. Thank you for joining our call today. I'll start with an overview of our major accomplishments during the Q4 and full year of 2025. Before we dive into the key figures, I want to underscore that 2025 was an exceptional year for VNET. Our effective dual-core strategy and Hyperscale 2.0 framework empowered us to capture surging AI demand and deliver impressive results. Let's turn to slide 4. On the operational side, our wholesale IDC business continued to grow significantly, driven by robust customer demand and our rapid delivery capabilities.

Good morning and good evening, everyone.

Thank you for joining our call today.

I'll start with an overview of our major accomplishments during the fourth quarter and full year of 2025.

Before we dive into the key figures, I want to underscore that 2025 was an exceptional year for VNET.

Our effective dual course strategy and Hyperscale 2.0 framework empowered us to capture surging AI demand and deliver impressive results.

Let's turn to slide 4.

Sharon Xiao Liu: As of December 31, 2025, our wholesale capacity in service grew to 889MW, an increase of around 107MW quarter-over-quarter, bringing our total deliveries for the full year of 2025 to a record high 404MW, in line with our full year delivery plan. Wholesale capacity utilized by customers rose to 623MW, an increase of around 41MW quarter-over-quarter, driven by continued strong customer demand and our solid execution. Customers moved into 270MW over the full year, bringing the utilization rate to 70.1%. Our retail IDC business continued to progress smoothly, benefiting from growing AI-driven demand. In Q4, our retail MRR per cabinet was CNY 9,420. Retail utilization rate was stable at 64.0%.

On the operational side, our wholesale IDC business continued to grow significantly, driven by robust customer demand and our rapid delivery capabilities.

As of December 31, 2025, our wholesale capacity in service grew to 889 megawatts.

Over a quarter.

Bringing our total deliveries for the full year of 2025 to a record high of 404 megawatts, in line with our full-year delivery plan.

Wholesale capacity utilized by customers rose to 623 megawatts, an increase of around 41 megawatts quarter over quarter, driven by continued strong customer demand and our solid execution.

Sharon Xiao Liu: On the financial side, our total net revenues increased by 19.6% year-over-year to RMB 2.69 billion for Q4. Wholesale revenues remained the key growth driver, reaching RMB 978.1 million, a significant year-over-year increase of 47.1%. Our adjusted EBITDA for Q4 also increased by 11.6% year-over-year to RMB 805.1 million, driven by the rapid growth of our wholesale IDC business. Excluding the one-off impact of asset disposals in Q4 of 2024, adjusted EBITDA increased by 39.3% year-over-year.

Customers moved into 270 megawatts over the full year, bringing the utilization rate to 70.1% in our retail IDC business. The business continued to progress smoothly, benefiting from growing AI-driven demand in the fourth quarter. Our retail MRR per cabinet was RMB 9,420. Retail utilization rate was stable at 64.0%.

On the financial side, our total net revenues increased by 19.6% year-over-year to RMB 2.69 billion for the fourth quarter.

Wholesale revenues remain the key growth driver, reaching RMB 978.1 million, a significant year-over-year increase of 47.1%. Our adjusted EBITDA for the fourth quarter also increased by 11.6% year-over-year to RMB 805.1 million, driven.

By the rapid growth of our wholesale IDC business.

Excluding the one-off impact of asset disposals, in the fourth quarter of 2024.

Sharon Xiao Liu: For the full year of 2025, our total revenues grew significantly by 20.5% to RMB 9.95 billion, and Adjusted EBITDA grew 22.6% to RMB 2.98 billion, both significantly outperforming our 2025 guidance. We continue to advance our capital recycling strategy in 2025 and achieved meaningful results. In November 2025, we successfully issued an RMB 860 million holding type real estate green asset-backed security. Also, in March 2026, two of our private REITs projects were listed on the Shanghai Stock Exchange with a total offer size of approximately RMB 6.36 billion. Moving into 2026, customer demand for our wholesale IDC business remains strong. Meanwhile, our ongoing operational efficiency gains are providing increasingly robust support for this business' high-quality growth.

Adjusted EBITDA increased by 39.3% year-over-year for the full year of 2025. Our total revenues grew significantly by 20.5% to RMB 9.95 billion.

And adjusted EBITDA grew 22.6% to RMB 2.98 billion.

Both significantly outperforming our 2025 guidance.

We continued to advance our capital recycling strategy in 2025 and achieved meaningful results.

In November 2025, we successfully issued an RMB 860 million holding-type real estate green asset-backed security.

Also, in March 2026, two of our private REITs projects were listed on the Shanghai Stock Exchange with a total offer size of approximately RMB 6.36 billion.

Sharon Xiao Liu: We expect our full year 2026 revenue to be in the range of RMB 11.5 to 11.8 billion, representing a year-over-year increase of 15.6% to 18.6%, and adjusted EBITDA to be in the range of RMB 3.55 to 3.75 billion, representing a year-over-year increase of 19.2% to 25.9%. Moving on to our new order wins on slide five. Order momentum remained strong in Q4, largely fueled by brisk demand from customers. During the quarter, we secured 5 wholesale orders totaling 135 megawatts. Specifically, in addition to the 32-megawatt order mentioned on our last call, we won a 12-megawatt order from an internet customer for a data center in the Yangtze River Delta.

Moving into 2026, customer demand for our wholesale IDC business remains strong. Meanwhile, our ongoing operational efficiency gains are providing increasingly robust support for this business's high-quality growth. We expect our full year 2026 revenue to be in the range of RMB 11.5 billion to RMB 11 billion.

$0.8 billion, representing a year-over-year increase of 15.6% to 18.6%.

And adjusted EBIT to be in the range of RMB 3.55 billion to RMB 3.75 billion, representing a year-over-year increase of 19.2% to 25.9%.

Moving on to our new order wins on Slide 5.

Order momentum remains strong in the fourth quarter, largely fueled by brisk demand from customers during the quarter. We secured 5 wholesale orders, totaling 135 megawatts.

Specifically, in addition to the 32-megawatt order mentioned on our last call,

Sharon Xiao Liu: Meanwhile, we also won a 56MW order from a cloud service provider, and a 25MW order from an intelligent driving customer, and an 11MW order from another internet customer for our data centers in the Greater Beijing area this quarter. Furthermore, bolstered by AI-driven demand, we secured a combined capacity of approximately 2MW in new retail orders across multiple retail data centers from customers in the intelligent driving, local services, AIOT, and financial services sectors. China's IDC industry continues to thrive, driven by strong market demand as well as supportive policies. At the national level, authorities have rolled out a series of systematic and actionable policies, sustaining their support for the digital economy and computing infrastructure.

We won a 12-megawatt order from an internet customer for a data center in the Yangu River Delta. Meanwhile, we also won a 56-megawatt order from a cloud service provider and a 25-megawatt order from an intelligent driving customer.

And an 11-megawatt order from another internet customer, for our data centers in the greater Beijing area, this quarter.

Furthermore, bolstered by AI-driven demand, we secured a combined capacity of approximately 2 megawatts in new retail orders across multiple retail data centers from customers in the intelligent driving, local services, AIoT, and financial services sectors.

China's IDC industry continues to thrive.

Driven by strong market demand as well as supportive policies.

At the national level, authorities have rolled out a series of systematic and actionable policies.

Sharon Xiao Liu: At the industry level, accelerating AI adoption and enterprise digital transformation, along with increasingly clear and sustained investment commitments from large and mid-size customers, particularly leading internet companies and cloud service providers, are fueling strong visible demand for high-quality IDC services. Market demand is further shifting toward large-scale, clustered, and highly reliable data center infrastructure. While rising requirements for delivery certainty, long-term scalability, and green operations are tightening effective supply. Our industry-leading delivery performance, premium IDC services, and scalable data center clusters continue to strengthen VNET's competitiveness in this market environment. Guided by our dual-core strategy and Hyperscale 2.0 framework, we are well-positioned to capture growth opportunities and expand market share in an increasingly AI-driven infrastructure landscape. Now let's delve into our business updates, starting with our wholesale business on slide 7.

Sustaining their support for the digital economy and computing infrastructure.

At the industry level.

Operating AI adoption and enterprise digital transformation.

Along with increasingly clear and sustained investment commitments from large and midsize customers, particularly leading internet companies and cloud service providers, we are seeing strong, visible demand for high-quality IDC services. Market demand is further shifting toward large-scale, clustered, and highly reliable data center infrastructure.

Rising requirements for delivery certainty, long-term scalability, and green operations are tightening effective supply.

Our industry-leading delivery performance, premium IDC services, and scalable data center clusters continue to strengthen VNET's competitiveness in this market environment.

Guided by our dual-core strategy and Hyperscale 2.0 framework, we are well positioned to capture growth opportunities and expand market share in an increasingly AI-driven information landscape.

Sharon Xiao Liu: Our wholesale business maintained strong growth momentum, with capacity in service increasing by around 107 megawatts quarter-over-quarter to 889 megawatts, and utilization rate at 70.1%, mainly attributable to rapid deliveries at our NOR Campus 02A and NHB Campus 03, and fast move-ins at our NOR Campus 02A. Our mature capacity utilization rate also reached 93.1%, a relatively high level. We have a clear growth path for our wholesale data center capacity. Let's move on to slide 8. As of the end of Q4, our total wholesale resource capacity was around 2.2 gigawatts. Specifically, our capacity under construction was around 452 megawatts.

Now, let's delve into our business updates, starting with our wholesale business on Slide 7.

Our wholesale business maintains strong growth momentum, with capacity in service increasing by around 107 megawatts quarter over quarter to 889 megawatts, and utilization rate at 70.1%, mainly attributable to rapid deliveries at our NOR, Compass 02A and—

NHB Compass 03 and fast move-in at our NOR Compass 02.

Our mature capacity utilization rate also reached 93.1%, a relatively high level.

We have a clear growth path for our wholesale data center capacity. Let's move on to slide 8.

As of the end of the fourth quarter, our total wholesale resource capacity was around 2.2 gigawatts.

Specifically.

Sharon Xiao Liu: Capacity held for short-term future development was around 513MW, and capacity held for long-term future development was around 327MW. These secured resources represent a significant advantage in light of the IDC industry's limited effective supply, and are in line with our optimistic view of AI-driven demand's long-term growth potential. Moving to our retail IDC business on slide nine. Our retail business progressed smoothly in Q4. Retail capacity in service decreased to 49,863 cabinets from 52,288 cabinets last quarter. Mainly because the target retail data center under our private REITs project was excluded from the group's consolidated capacity. The utilization rate was stable at 64.0%.

Our capacity under construction was around 4,552 megawatts.

Capacity held for short-term future development was around 513 megawatts, and capacity held for long-term future development was around 327 megawatts.

These secured resources represent a significant advantage in light of the IDC industry's limited effective supply and are in line with our optimistic view of AI-driven demand and long-term growth potential.

Moving to our retail IDC business on slide 9.

Our retail business progressed smoothly in the fourth quarter.

Retail capacity in service decreased to 49,863 cabinets from 52,288 cabinets last quarter.

Sharon Xiao Liu: As of the end of December, our MRR per retail cabinet increased slightly to CNY 9,420 this quarter from CNY 8,948 last quarter, driven by the increasing adoption of value-added services amid vast AI-driven demand. Turning to our delivery plan on slide 10. As I mentioned before, leveraging our efficient delivery capabilities, we successfully delivered a total of around 107 megawatts in Q4 of 2025, bringing our total deliveries to around 404 megawatts as of the end of December this year. We currently have seven data centers under construction, with six in the Greater Beijing area and one in the Yangtze River Delta. We plan to deliver 450 to 500 megawatts of capacity over the next 12 months to meet the strong demand from our wholesale customers.

Mainly because the target retail data center under our private REITs project was excluded from the Group's consolidated capacity. The utilization rate was stable at 64.0% as of the end of December. Our MRR per retail cabinet increased slightly to RMB 9,420 this quarter from RMB 8,948 last quarter, driven by the increase in adoption of value-added services amid vast, AI-driven demand.

Turning to our delivery plan on Slide 10. As I mentioned before, leveraging our efficient delivery capabilities.

We successfully delivered a total of around 107 megawatts in the fourth quarter of 2025.

Bringing our total deliveries to around 404 megawatts. As of the end of December this year, we currently have seven data centers under construction.

With six in the greater Beijing area and one in the Yangtze River Delta.

Sharon Xiao Liu: In conclusion, our robust Q4 and full year 2025 results validate our operational excellence, growth strategy, and our ability to identify and capture market demand in the AI era. As we move into 2026, we will continue to advance our dual-core strategy and Hyperscale 2.0 framework, developing our scalable, high-performance, and energy-efficient data centers to seize growth opportunities while empowering China's digital economy for sustainable growth. Now, I will turn the call over to our SVP of Operational Finance, Peter Zhang, for further discussion of our operating and financial performance. Thank you, everyone.

We plan to deliver 450 to 500 megawatts of capacity over the next 12 months to meet the strong demand from our wholesale customers. In conclusion, our robust fourth quarter and full year 2025 results.

Validate our operational excellence growth strategy, and our ability to identify and capture market demand in the AI era.

As we move into 2026, we will continue to advance our dual-core strategy and Hyperscale 2.0 framework, developing our scalable, high-performance, and energy-efficient data centers to seize growth opportunities, while empowering China's digital economy for sustainable growth. Now, I will turn the call over to our SVP of Operational Finance, Peter, for further discussion of our operating and financial performance.

Thank you, everyone.

Peter Zhihua Zhang: Good morning and good evening, everyone. Before we start the detailed discussion of our financial performance, please note that unless otherwise stated, all the financials we present today are for the Q4 and the full year of 2025 and are in renminbi terms. Furthermore, unless otherwise specified, all the growth rates I am reviewing are on a year-over-year basis. Let's turn to slide 12. In the Q4, we continued to pursue high-quality business. Our total net revenues increased by 19.6% to RMB 2.69 billion, mainly driven by the rapid growth of our wholesale business.

Good morning and good evening, everyone. Before we start the detailed discussion of our financial performance,

Please note that, unless otherwise stated, all the financials we present today are for the fourth quarter and the full year of 2025, and our 'Union' may be terms.

Furthermore, unless otherwise specified, all the growth rates I am reviewing are on a year-over-year basis.

Let's turn to slide 12.

In the fourth quarter, we continue to pursue high-quality business.

Our total net revenues increased by 19.6% to RMB 2.69 billion,

Peter Zhihua Zhang: Our adjusted cash gross profit rose by 23.1% to RMB 1.14 billion, while our adjusted EBITDA also grew year-over-year by 11.6% to RMB 805.1 million. Meanwhile, excluding the one-off impact of asset disposals in Q4 2024, our adjusted cash gross profit and adjusted EBITDA increased significantly by 31.1% and 39.3% respectively year-over-year. For the full year, our total net revenues were RMB 9.95 billion, increasing by 20.5%, and adjusted EBITDA reached RMB 2.98 billion, reflecting an impressive 22.6% increase from the prior year, both exceeding the raised guidance we issued in Q3. Let's look more closely at our top line. As you can see on slide 13.

Mainly driven by the rapid growth of our wholesale business, our adjusted cash gross profit rose by 23.1% to RMB 1.14 billion.

While our adjusted EBA also grew year-over-year by 11.6% to RMB 80,005.1 million.

Meanwhile, excluding the one-off impact of asset disposals in the fourth quarter of 2024.

Our adjusted cash growth profit and adjusted EBITDA increased significantly.

By 31.1% and 39.3%, respectively. Year-over-year for the full year, our total net revenues were RMB 9.95 billion, increasing by 20.5%, and adjusted EBITDA reached RMB 2.98 billion.

Reflecting an impressive 22.6% increase from the prior year, both exceeding the raised guidance we issued in the third quarter.

Peter Zhihua Zhang: In Q4, wholesale revenues, our key revenue growth driver, increased significantly by 47.1% to RMB 978.1 million, mainly attributable to activity at the NOR Campus 02A. For the full year, our wholesale revenues increased significantly by 77.4% to RMB 3.46 billion, driven by rapid customer move-in pace this year. Retail revenues increased by 7.6% to RMB 1.04 billion for Q4 and increased by 3.5% to RMB 3.96 billion for 2025. Our non-IDC business revenues increased by 8.8% to RMB 670.8 million for Q4, and increased by 1.8% to RMB 2.52 billion for 2025.

Let's look more closely at our top line. As you can see on slide 13, in the fourth quarter, wholesale revenues, our key revenue growth driver, increased significantly by 47.1% to RMB 978.1 million. Mainly attributable to activity at the N Compass 028. For the full year, our wholesale revenues increased significantly by 77.4% to RMB 3.46 billion.

Driven by the rapid customer moving pace this year.

Retail revenues increased by 7.6% to RMB 1.04 billion for the fourth quarter, and increased by 3.5% to RMB 3.96 billion for 2025. Our non-IDC business revenues increased by 8.8% to RMB 670.8 million for the fourth quarter, and increased by 1.8% to RMB 2.52 billion.

Peter Zhihua Zhang: During Q4, we maintained solid margins thanks to our ongoing efficiency improvements. As shown on slide 14, our adjusted cash gross margins improved modestly to 42.3% from 41.1% in the same period last year. Our adjusted EBITDA margin was largely stable at 30.0%. Moving on to liquidity. On slide 15, we maintained robust and healthy liquidity, bolstered by a net operating cash inflow of RMB 546.4 million during Q4, bringing our net operating cash inflow for this year to RMB 1.92 billion. If the RMB 231.0 million of income tax from one-off asset and equity disposal were excluded, the net operating cash inflow for this year was RMB 2.15 billion.

For 2025, during the fourth quarter, we maintained solid margins, thanks to our ongoing efficiency improvements.

As shown on slide 14, our adjusted cash gross margins improved modestly to 42.3% from 41.1% in the same period last year.

Our adjusted EBITDA margin was largely stable at 30.0%.

Moving on to liquidity on slide 15. We maintained robust and healthy liquidity, bolstered by a net operating cash inflow of RMB 546.4 million.

During the fourth quarter, bringing our net operating cash inflow for this year to RMB 1.92 billion. If the RMB 231.0 million of income tax from one-off asset and equity disposal were excluded.

Peter Zhihua Zhang: Our cash position remains solid, with total cash and cash equivalents, restricted cash, and short-term investments reaching RMB 6.58 billion as of 31 December 2025. Next, let's take a look at our debt structure on slide 16. We maintained our prudent approach to debt management. As of 31 December 2025, our net debt to the adjusted last quarter annualized EBITDA ratio was 4.3, and total debt to the adjusted last quarter annualized EBITDA ratio was 6.2, both remaining at healthy levels. Our adjusted trailing twelve months EBITDA to interest coverage ratio was 6.7. We prioritize long-term debt maturity planning in our debt and strategic management to ensure the security of debt repayment. Currently, the company's short- and medium-term debt maturing in 2026 to 2028 comprises 46.6% of our total debt.

The net operating cash inflow for this year was RMB 2.15 billion. Our cash position remains solid.

With total cash and cash equivalents

Restricted cash and short-term investments reaching RMB 6.58 billion as of December 31, 2025.

Next, let's take a look at our debt structure on slide 16.

We maintained our prudent approach to that management as of December 31, 2025.

Our net debt to the adjusted last quarter annualized EBT ratio was 4.3, and total debt to the adjusted last quarter annualized EBA ratio was 6.2, both remaining at healthy levels.

Our adjusted trailing 12 months EBA to interest coverage ratio was 6.7. We prioritize long-term debt maturity planning in our debt and strategic management.

To ensure the security of debt repayment.

Peter Zhihua Zhang: Turning now to CapEx spending. As you can see on slide 17, for full year 2025, our CapEx was RMB 8.24 billion, with the majority allocated to the expansion of our wholesale IDC business. Actual CapEx came in below our prior full year guidance, primarily due to cost efficiencies from economies of scale and enhanced supply chain management. We expect our CapEx for the full year 2026 to be in the range of RMB 10 billion to RMB 12 billion, mainly to support our planned delivery of 450 to 500 MW in 2026. We made meaningful progress in advancing our asset monetization strategy this year. In November 2025, we successfully issued a holding type green real estate asset-backed security under one of our private REIT programs, the first of its kind in China's IDC industry.

% of our total debt.

Turning now to capex spending.

As you can see on slide 17, for full year 2025.

Our CapEx was RMB 8.24 billion.

With the majority allocated to the expansion of our wholesale IDC business. Actual capex came in below our prior 4-year guidance.

Primarily due to cost efficiencies from economies of scale and enhanced supply chain management, we expect our capex for the full year 2026 to be in the range of RMB 10 billion.

And R&B 12 billion.

Mainly to support our plan delivery of 450 to 500 megawatts in 2026.

We made meaningful progress in advancing our asset monetization strategy this year.

Peter Zhihua Zhang: The offering totaled CNY 860 million, with equity consideration of around CNY 800 million, implying a valuation of approximately 13x EV to EBITDA. Notably, this project has received a G-1 rating from an authoritative third-party evaluation institution, the highest possible rating in the relevant evaluation system. VNET ceased consolidating the project for financial reporting purposes. However, as the issuer and originator for the private REIT project, VNET will remain responsible for the IDC project's operation to ensure its healthy long-term development. More recently, in March 2026, two of our private REIT projects were successfully listed on the Shanghai Stock Exchange, with a combined offering size of approximately CNY 6.36 billion and an EV to EBITDA multiple of around 13x to 14x.

In November 2025, we successfully issued a holding type green, real estate, asset-backed security under one of our private RAID programs. The first of its kind in China's IDC industry, the offering totaled RMB 860 million with equity consideration of around RMB 800 million.

implying a valuation of approximately 13 times EV to EBITDA.

Notably, this project has received a G1 rating from an authoritative third-party evaluation institution.

The highest possible rating in the relevant evaluation system. VNET sees consolidating the project for financial reporting purposes. However, as the issuer and originator for the private REIT project,

VNET will remain responsible for the IDC projects’ operation to ensure its healthy long-term development.

More recently in March 2026.

Two of our private read projects were successfully listed on the Shanghai Stock Exchange.

Peter Zhihua Zhang: Looking ahead. We will continue to execute capital recycling initiatives to further unlock the value of our existing IDC assets. Proceeds from these initiatives will be reinvested into new project development and incremental business expansion, supporting our long-term growth strategy. Additionally, they will effectively reduce leverage and optimize the company's capital structure, ultimately creating long-term value for shareholders. Now moving to our full year guidance for 2026 on slide 19.

With the combined offering size of approximately RMB 6.36 billion and the EV to EBITDA multiple of around 13 times to 14 times, looking ahead, we will continue to execute capital recycling initiatives to further unlock the value of our existing IDC assets.

Proceeds from these initiatives will be reinvested into new project development and incremental business expansion.

Supporting our long-term growth strategy. Additionally,

They will effectively reduce leverage and optimize the company's capital structure.

Ultimately, creating long-term value for shareholders.

Peter Zhihua Zhang: As we expect strong demand from our wholesale IDC customers and ongoing operational efficiency gains throughout 2026, we expect total net revenues to be in the range of CNY 11.5 billion to 11.8 billion, a year-over-year increase of 15.6% to 18.6%, and adjusted EBITDA to be in the range of CNY 3.55 billion to 3.75 billion, representing a year-over-year increase of 19.2% to 25.9%. Before I conclude, I'd like to briefly update you on our ESG efforts, building on our constant dedication to sustainability. VNET continues to receive recognition from leading global rating institutions. We have been included in the global edition of the S&P Global Sustainability Yearbook 2026 for a second consecutive year, reflecting the consistency of our ESG practice.

Now, moving to our four-year guidance for 2026 on slide 19.

As we expect strong demand from our wholesale, IDC customers, and ongoing operational efficiency gains throughout 2026, we expect total net revenue to be in the range of RMB 11.5 billion to RMB 11.8 billion, a year-over-year increase of 15.6% to 18.6%.

And adjusted EBITDA to be in the range of RMB 3.55 billion.

To R&B, $3.75 billion, representing a year-over-year increase of 19.2% to 25.9%.

before I conclude.

I'd like to briefly update you on our ESG efforts.

Building on our constant dedication to sustainability.

VNET continues to receive recognition from leading global rating institutions. We have been included in the global edition of the S&P Global Sustainability Yearbook.

Peter Zhihua Zhang: In addition, VNET earned a B rating in CDP's 2025 climate change questionnaire, underscoring strong performance across key environmental metrics. Looking ahead, we will continue to strengthen our ESG framework, embedding sustainability more deeply into our operations and business strategy to support our sustainable growth and value creation. To sum up, our strong Q4 performance capped 2025 and laid a solid foundation for 2026. We will continue to reinforce our core strengths, optimize resource allocation, and proactively capture opportunities arising from AI adoption and enterprise digital transformation. We remain dedicated to delivering high-quality growth that creates long-term value for all stakeholders. This concludes our prepared remarks for today. We are now ready to take questions.

2026 for a second consecutive year, reflecting the consistency of our ESG practice.

In addition, VNET earned a B rating in CDP's 2025 Climate Change Questionnaire, underscoring strong performance across key environmental metrics looking ahead.

We will continue to strengthen our ESG framework, embedding sustainability more deeply into our operations and business strategy to support our sustainable growth and value creation.

To sum up our strong fourth quarter performance, cap 2025.

And laid a solid foundation for 2026.

We will continue to reinforce our core strengths.

Optimize resource allocation and proactively capture opportunities arising from AI adoption and enterprise digital transformation. We remain dedicated to delivering high-quality growth.

That creates long-term value for all stakeholders.

This concludes our prepared remarks for today.

Operator 2: Thank you. We will now begin the question and answer session. If you wish to ask a question, please press star then one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two, and if you are on a speakerphone, please pick up your handset before asking your question. For the benefit of all participants on today's call, please ask your question to management in English and then repeat in Chinese. First question today comes from Tom Tang at Morgan Stanley. Please go ahead.

Operator: Thank you. We will now begin the question and answer session. If you wish to ask a question, please press star then one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two, and if you are on a speakerphone, please pick up your handset before asking your question. For the benefit of all participants on today's call, please ask your question to management in English and then repeat in Chinese. First question today comes from Tom Tang at Morgan Stanley. Please go ahead.

Thank you.

We will now begin the question and answer session.

If you wish to ask a question, please press star, then 1 on your telephone, and wait for your name to be announced. If you wish to cancel your request, please press star, 2. And if you are on a speakerphone, please pick up your handset before asking your question. For the benefit of all participants on today's call, please ask your question to management in English, and then repeat in Chinese.

First question today comes from Tom Tang at Morgan Stanley.

Please go ahead.

Tom Tang: Okay, thank you, management, for the opportunity to ask questions. Again, congratulate on a very strong result and a very solid, full guidance for the year of 2026. I have two questions. First of all, we heard that there has been some big customers starting tender on their 2026 and 2027 data centers in the beginning of the year. Just wondering, have we been participating in those tender? And what has been our current progress? Secondly, we know that our Q4 total resource on hand had almost 400 megawatts increase quarter-over-quarter. Just wondering what are the regions for our new resources? And do we have any outlook for our new resources for the year?

Hi. Uh, thank you, management, for the opportunity to ask questions. And again, congratulations on a very strong result and a very solid, uh, forecast for the year of 2026.

Tom Tang: 我来简单翻译一下，首先还是感谢管理层给我这个提问的机会，非常恭喜一个强劲的业绩，以及一个比较稳健的二六年的展望。我这里有两个问题，第一个问题是我没有了解到年初市场上有些大客户已经开展了比较大规模的招标工作，所以想请教一下我们这里的一个参与以及进展如何。那么第二个问题是我们看到我们第四季度总资源数有接近400兆瓦的一个增加，所以想了解一下这些新资源的主要分布是在什么区域，以及对二六年新增资源的一个展望。谢谢。

So I have 2 questions. So first of all, we heard that there has been some big customers, uh, starting tender on on their 2026 and 2027 uh, data centers uh, in the beginning of the year. So just wondering, have we been participating in those tender and what has been our current progress? Uh, secondly, we know that our fourth quarter Total Resource on hand, had an almost 400 megawatt increase quote, unquote quarter. So, just wondering what are the regions for our new resources and do we have any outlook for our new resources for, uh, for the year? Well, actually,

For.

Sharon Xiao Liu: Tom，谢谢你的问题，我来回答一下你的两个问题。一个是我们确实注意到，今年年初的时候，我们的客户有很多这个招标的动作，那世纪互联作为这个国内 Tier 1 的 supplier，也都参与了招标。那后续如果招标有什么进展，我们会在我们的 earnings 里面去做披露，大家可以关注一下公司未来的一个披露。第二个呢，我们的确是在 Q4 的时候，在整个的 overall 的资源上有一些比较大的进展，那这个增量主要集中在这个环京地区，那一个是在乌兰察布地区，还有一个就是在北京周边的地区。那未来的话，公司在资源上，第一个我们还是会看整个环京的区域，包括内蒙和北京周边。另外一个我们在长三角也会继续地在我们存量资源的基础上去拓展资源。那公司整体上我们会去看一些这个能源成本相对较低的区域，网络时延也相对较低的区域，来给客户提供一个综合的服务。谢谢。

He doesn't care about the earnings limit.

Xinyuan Liu: Thank you, Tom, for your question. Let me take your two questions. We did notice that at the beginning of the year, some of our key clients have already hosted biddings or tenders. As the Tier 1 IDC service provider in China, we have also participated in these biddings. However, we are going to update on the market in terms of the progress and also the wins in our future earnings release. Please do follow our latest updates on this related matter. With regard to the second question, indeed, we have notably increased our resource reserve in Q4. A majority of these resources are located in the Greater Beijing area, specifically in Ulanqab and also the area surrounding Beijing.

Xinyuan Liu: Going forward, we will strategically, you know, value our resources reserve in the Greater Beijing area, particularly Inner Mongolia and its surrounding regions. On top of the existing resources we have in the Yangtze River Delta region, we are actively acquiring resources, expanding our reserve in that region. Just a quick point, we are actively looking for areas or regions where there are favorable utility conditions. We would also actively deploy in these areas, so as to provide a service which features low latency to meet our customers' demand.

Thank you, Tom, for your question. Uh, let me take your 2 questions. Uh, we did notice that at the beginning of the year, some of our key clients have already hosted a beatings or tenders and as the Tier 1 IDC IDC, uh, provider, uh, in China. We have also participated in this beatings, um, however, we, uh, are going to update on the market in terms of the progress and also, the wants uh, in our future earnings uh release. So please uh do uh follow our latest updates on this related matter and with regard to the second question uh indeed. We have a notably increased, our resource Reserve, uh in Q4 and a majority of these, these resources are located in, uh, the greater Beijing area, uh, specifically in Wulan chabu and also the area surrounding BAS.

Xinyuan Liu: Next question, please.

So just, uh, uh, quick point. We are actively looking for areas or regions where there are favorable, uh, utility, uh, conditions. Uh, so we would also actively deploy in these areas, uh, so as to provide, uh, a service which features low latency, uh, to meet our customers' demand.

Next question.

Operator 2: Thank you. Your next question comes from Edison Lee at Jefferies. Please go ahead.

Operator: Thank you. Your next question comes from Edison Lee at Jefferies. Please go ahead.

Thank you. Your next question comes from Edison Lee at Jefferies. Please go ahead.

Edison Lee: Hi, thank you for taking my questions, and congrats on the results as well. I have three questions. Number one is, out of the 450MW to 500MW of capacity addition guidance this year, what percentage has been locked in already? What do you think is the progress over the next few quarters? Number two is, on CapEx, CNY 10 billion to 12 billion guidance this year, what percentage of that guidance is actually for 2027 growth? Certainly, can you explain how you're gonna finance this CNY 10 billion to 12 billion CapEx?

Hi. Uh, thank you for taking my questions, and uh, congrats on the resource as well. I have three questions. Number one is, out of the 450 megawatt to 5 watt of capacity at different guidance this year.

What percentage has been locked in already? And, uh, what do you think is the progress over the next few quarters? And number two is on capex, uh, $10 billion to $12 billion, R&B guidance this year. What percentage of that guidance is actually for 2027 growth?

Uh, and then thirdly, can you explain how you're going to finance this $10 to $12 billion R&D capex?

uh,

Xinyuan Liu: Hi, Edison.

add presentation.

Xinyuan Liu: Let me answer your first question. Thank you, Edison Lee. In our presentation slides, we have actually disclosed we have locked in 150 MW out of the 450 MW planned. We are going to disclose the capacity that's already secured in our future earnings call, as we participate in the biddings, sign MOUs, as well as the contracts that's being signed. Please follow these announcements from our future earnings calls quarter by quarter. Overall, the company is very highly confident in the capacity to be locked in for 2026. Now I'll pass it over to Peter Zhang for the second question.

Guitar.

Let me answer your first question. Um, thank you, Addison. In our presentation slides, we have actually disclosed that we have locked in 150 megawatts out of the 450-megawatt plant. Um, and we are going to, uh, disclose these capacities that are already secured in our, uh, future earnings call. Uh, as we, uh, participate in, uh, the biddings, sign MOU, as well as the, uh, contracts that are being assigned. Um, so please do follow up, uh, follow these announcements from our, uh, future earnings calls quarter by quarter. And overall, the company is very highly confident in the, uh, uh,

Capacity to be locked in for 2026. And now I'll pass it over to Peter for the second question.

Hey, nihal.

Xinyuan Liu: We have run some numbers internally, and the majority of the CapEx for 2026 is to deliver the capacity in 2026. Few of that CapEx or very little of that CapEx is going to be used for the capacity expansion and delivery in 2027. Hopefully that answers your question.

We have run some numbers internally, and the majority of the CapEx for 2026 is to, uh, deliver the, uh, capacity, uh, in 2026, and few of that CapEx, or very little of that capacity, is going to be used for the, uh, capacity extension and delivery in 2027. So hopefully that answers your question.

Sharon Xiao Liu: 好的，第三个问题是关于公司CapEx的融资，还是我这边来回答。整体上的话，其实从项目层面，我们主要还是用项目贷来去支持项目层面的融资，因为公司现在在国内也可以拿到非常好的条件的、更长期的、更低成本的一个项目贷。那其他的部分，其实公司还是会有非常多样化的途径，包括我们净经营的现金流每年也会有二十亿左右，然后包括其实公司也是走通了私募REITs的这种方式，然后包括其实我们也会在上市公司层面和项目层面做一些不同层次的股权融资来支持公司未来业务的扩张。同时我们也会平衡好这个公司的财务杠杆，在股权和债权融资中间找到一个平衡点。谢谢。

Xinyuan Liu: I'll take your question on the financing channels. Predominantly we are tapping into the project loans to finance our project. Given our current condition, the company is able to secure favorable and long-term loans with very low interest rates. On top of that, we are also exploring diversified means of financing channels. On top of that, we can finance these CapEx with our cash flow. Each year we're generating around CNY 2 billion cash so that can support our CapEx. In addition to all of these, we have successfully conducted or implemented the private REIT, so that is also another financing channel. Additionally, we are also going to tap into private equity as well as other means as a public listed company to finance our CapEx. All in all, we are going to maintain a, you know, fine balance between our debt and equity financing amount. We would maintain our leverage ratio within a reasonable range with prudent approach, you know, being implemented along the way.

I'll take your question on the financing channels. Um, predominantly, we are tapping into the project loans to finance our projects, given our current condition. The company is able to secure favorable—uh,

And the long-term, uh, loans with very, uh, low interest rates. Uh, on top of that, we are also exploring diversified means of financing channels. Um, on top of that, we can finance these capex with our cash flow. Uh, each year we're generating around RMB 2 billion, uh, cash, so that can, uh, support our capex. And, uh, in addition to all of these, we have successfully, uh, conducted or implemented—

Entered at the private rate. Um, so that is also another financing Channel. And uh, additionally, we are also going to, uh, tap into private Equity, as well as other means as a public listed company to, uh, fund to, uh, Finance, our capex. Um, all in all, we are going to maintain, uh, you know, fine balance between, uh, our, uh, debt and Equity financing amount. Uh, so we would maintain our leverage ratio within a reasonable, um, range with prudent approach. Uh,

You know, being implemented along the way.

Sharon Xiao Liu: Next question please.

Next question, please.

Operator 2: Thank you. Your next question comes from Daley Li at BofA Securities. Please go ahead.

Sharon Xiao Liu: Thank you. Your next question comes from Daley Li at BofA Securities. Please go ahead.

Your next question comes from Daily Lee at BFA Securities. Please go ahead.

Daley Li: Hi management, thanks for taking my question. First, congrats on the strong results and the solid guidance. I have two questions here. Number one is about our utilization rate in the Q4 last year, seems quarter-over-quarter dropped a bit. Could you update us what's the underlying reason? How do you see the future clients' moving progress in the following quarters? Do we have a target for the full year utilization rate? My second question is about the CapEx. It seems that last year the CapEx number is behind our target, which seems a good thing for, you know, in the view of investors. For this year, could you introduce us the reasons about the CapEx?

Hi management. Uh, thanks for taking my question. Uh, firstly, congrats on the strong results and the authority guidance. Uh, how 2 questions here? Um, number 1 is about our, uh, utilization rate, uh, in the Q4 last year, uh, since the quote unquote, uh, dropped a bit. Uh, could you update us what's the underlying reason and how do you see the future? Uh, clients are moving progress in the following quarters and do we have a target for the full year? Utilization rate?

Um, my second question is about the cap house, I assume. So last year, the cap app number, uh, is behind our target, uh, which seems a good thing for, uh, you know, in the view of, uh, in the view of investors. Um, and for this year,

Daley Li: For this year, do we see upsides for the more delivery given we have, you know, more CapEx for this year?

Daley Li: 好的，谢谢。我这边可能翻译一下。谢谢，谢谢管理层的提问。然后我这边有两个问题。第一个问题是关于我们的utilization rate利用率，就是四季度同比还是不错，然后环比这边有略微的下降，然后想问一下这个背后的原因，然后未来几个季度，我们对未来这个的趋势是怎么看的，我们对全年是否有一个目标。第二关于我们这个资本支出。去年资本支出的数字呢，其实比我们的预期，之前目标是低的，可能对投资来讲是一个好的事情，花了比较少的钱，然后还交付了比较强的一个目标。想问一下这个背后的原因，然后对于25年我们这个CapEx其实数字同比还是增速挺高的，然后这个对这个可能这个交付的成本之外，今年跟去年有什么不同？好，谢谢。

Um, yeah. Could you introduce us to the, uh, reasons for the campus, and for this year? Um, uh, do we see upsides for the, uh, more delivery given we have, you know, more capacity for this year?

Uh, how would this be?

Sharon Xiao Liu: 李，谢谢你的问题。我先来回答第一个关于上架率，确实从Q4披露的数字来说，我们上架率稍微有一点点波动，这个还是和上架率的计算有关，因为Q4的交付还是集中在年尾，所以它在整个季度的影响来说，就整体上会拉低了。但是如果我们Q1交付得少，其实utilization rate还是会回升的。那整体上utilization rate每个季度我们披露的数字其实是两部分组成，一个是我们成熟机房，其实它会在一个90到95的一个水平。另外还有就是我们这个季度run up的机房的一个客户的上架的比例。在我们每个季度交付量比较大的季度，其实UR都是会有一个小幅的波动，我们认为这个都是一个正常的波动了。所以从整个2026年来说，公司对于上架也是比较有信心的，我们认为它还是会维持在一个70到75的这个range之内，那季度可能会有不同的波动。

Xinyuan Liu: 对，关于CapEx的问题，我先交给Peter。

Woman.

Xinyuan Liu: Let me take your question on the utilization rate. Thanks for your question. Indeed, as we have disclosed in our presentation, the Q4 utilization rate did fluctuate. However, to clarify, majority of the deliveries happen in the end of the year, hence the fluctuation out there. Actually our utilization rate can be specifically broken down into two parts. One is the utilization rate for the mature capacities we have in place. Right now that's in the 90% to 95% range. However, for the ramp-up capacities, that's another portion of the utilization rate. We see these fluctuations as perfectly normal. Overall, the company is confident in the utilization rate. In 2026, we are confident to maintain that within 70% to 75%. However, admittedly there is going to be fluctuations quarter by quarter. Hopefully that answers your question. Now I'll pass it over to Peter for the second question.

Let me take a question on the utilization rate. Uh, thanks for the question. Uh, indeed. As we have disclosed in our presentation, the Q4 utilization rate did fluctuate. Uh, however, to clarify, the majority of the deliveries happened at the end of the year. Hence, the fluctuation out there. Actually, our utilization rate can be specifically broken down into two parts. One is the utilization rate for the mature capacities we have in place right now—that's in the 90 to 95% range. However, for the ramp-up capacity, uh, that—

Peter Zhihua Zhang: 你好。那关于第二个问题呢，我将会回应一下。那第一个是2025年的CapEx，实际上我们最终是支出82个亿。那相比之前来讲，一方面主要是基于我们整个规模，因为2025年比2024年的整个的投资是大幅增加，在这个情况下，这个规模产生的成本优化或者效应，这是一方面。第二来讲，对于整个供应链的环节能力，我们也在持续地优化和升级。所以整体来讲，我们2025年是82个亿。那2026年来讲，还是基于比较强的客户需求，我们还是维持在100到120亿的这个CapEx投资的指引，保持客户的交付和我们整个的投资的意愿，持续地增长。谢谢。

Another portion of the utilization rate. Um, we see these, uh, fluctuations, as perfectly normal, uh, overall, the company is confident in the utilization rate, uh, in 2026, we're confident to maintain that within 70 to 70 75%. Um however, additionally there is uh going to be fluctuations quarter by quarter uh hopefully that answers your question. Now, I'll pass it over to Peter for the second question.

Xinyuan Liu: On the CapEx question, in 2025, our CapEx expenditure was CNY 8.2 billion. Actually that compared to 2024 was a significant increase. However we didn't notice, but nevertheless we saw some economies of scale because of the significant increase in the CapEx. Meanwhile, we are also enhancing our capacity along the supply chain management, that also gives us some tailwinds. Looking ahead to 2026, our CapEx guidance is around CNY 10 to 12 billion. Majority of it is going to be used to deliver the capacity as well as to fuel our continuous expansion.

Xinyuan Liu: Next question please.

On the capex question, um, in 2025, our capex expenditure was, uh, RMB 8.2 billion. Um, actually that compared to 2024 was a significant increase, um, however, we didn't notice. But nevertheless, we, uh, saw some economies of scale because of the significant increase in the capex. Um, meanwhile, we are also enhancing our capacity along the supply chain management. Um, that also gives us some, uh, tailwinds. Um, looking ahead to 2026, our capex guidance is around RMB 10 to 12 billion. Majority of it is going to be used to deliver the capacity as well as to fuel our continuous expansion.

Next question, please.

Operator 2: Thank you. Your next question comes from Timothy Zhao at Goldman Sachs. Please go ahead.

Operator: Thank you. Your next question comes from Timothy Zhao at Goldman Sachs. Please go ahead.

Thank you. Uh, your next question comes from Timothy Xiao at Goldman Sachs.

Please go ahead.

Timothy Zhao: Thank you management for taking my question, and congrats on the solid results and outlook. I have two questions here. One is on the breakdown of your 2026 outlook. Just wondering if you can provide more detailed guidance, in terms of the revenue growth outlook between the wholesale IDC, retail IDC, and non-IDC business, and any color on the EBITDA growth between different segments will be quite helpful. Secondly is on the pricing trend. I note that, for your wholesale business in Q4 there was some pricing fluctuation. However, for the retail business, the pricing trend seems to be more robust. Just wondering if you can share any color on the pricing fluctuation between wholesale and retail business in Q4. Thank you.

I have two questions here. Uh, one is on the breakdown of your 296 outlook. Just wondering if you can provide more detailed guidance, uh, in terms of the revenue growth outlook between the wholesale IDC, retail IDC, and IDC business. And any color on the EBITDA growth between, uh, different segments would be quite helpful. Uh, secondly, is on the pricing trend. I note that, uh, for your wholesale business in the fourth quarter, there was some, uh, pricing fluctuation. However, for the retail business, the pricing trend seems to be more robust, but wondering if you can share any color on the pricing fluctuation between wholesale and the retail business in the fourth quarter. Thank you.

Peter Zhihua Zhang: 你好，关于你两个问题我先回应一下。那第一个问题关于整个2026年的指引，分三个模块给您一个反馈吧。第一个是城市型的IDC，这个较2025年来讲也会有一定幅度的增加，这里面肯定来自于我们零售业务。第二个是基地型的业务，还是会保持比较高的一个增长幅度。拿IDC的业务来目前来讲也算得比较平稳。我从三个维度给您做个基本形势汇报。那关于第二个问题来讲的话，就是您刚提到的业务的这个价格的波动。其实刚才也提到了，整个零售业务，因为客户对于零售业务的一些需求其实一直来都比较强劲，所以整体来讲，整个需求，整个的单价，是要增长的，以及这里面单机柜的电密度也在提高。那随着高密度这种需求的持续，未来我们预计整体来讲，零售MRR会还会保持一个比较平稳、可持续的增长的趋势。谢谢。

Yeah, but do you want to go?

Now.

Xinyuan Liu: With regard to the guidance for 2026, I would like to break it down by the three segments. For retail IDC, it's going to continue to grow compared to year over year. That is also true for our wholesale IDC services. We're going to witness significant growth. Whereas for our non-IDC business, it's going to be stabilized, it's going to be stable. Moving on to the pricing trend. Indeed, for our retail IDC service, we have seen the MRR continue to trend up. That comes from several drivers. Number one, our customers have a stronger demand for our value-added services. Number two, our unit price per cabinet is also increasing. Also, the high power density cabinets we have also yield higher MRR.

In regard to the, uh, guidance for 2026. Um, I would like to break it down according to based off, um, by the 3 segments, for retail IDC, it's going to continue to, uh, grow compared to a year-over-year. Um, and that is also true for our wholesale, uh, IDC Services. We're going to witness significant growth. Whereas for our nonc business, it's going to be, uh, stabilized. It's going to be stable, um, moving on to the pricing, uh, Trend, indeed for our, uh, retail. Uh,

Xinyuan Liu: Overall, that is going to contribute to a stronger MRR going forward in 2026.

IDC Service. Uh, we have seen the MRR continue to trend up. Uh, that comes from several drivers. Number one, our customers have a stronger demand for our value-added services. Uh, number two, our unit price per cabinet is also increasing. Um, also, the high power density cabinets have also yielded higher MRR. Overall, that is going to contribute to a stronger MRR.

Xinyuan Liu: Next question, please.

Going forward in 2026.

Next question, please.

Operator 2: Thank you. Your next question comes from Ethan Zhang at Nomura. Please go ahead.

Operator: Thank you. Your next question comes from Ethan Zhang at Nomura. Please go ahead.

Does your next question come from Ethan Zhang at Numéro?

Please go ahead.

Speaker 18: Okay. Thanks, management. Two questions from me. First, could you follow up on the CapEx guidance? Could you give us some color on the gearing ratio for this year, for example, the net debt to EBITDA for guidance for this year? And if we are seeing continued or further higher than expected demands, any chances that we could further increase our gearing ratio? And my second question is regarding the Ulanqab project. We noticed some tailwinds, positive tailwinds in terms of the coordination of computing power.

Um, okay, thanks, management. Uh, so, two questions from me. Um, so first, uh, could you follow up on the guidance? So, could you give us some color on the gearing ratio for this year? For example, the net debt to, uh, EBITDA, uh, for, uh, guidance for this year. And, uh, if we are seeing continued or further, uh, higher, um, demands than already expected, any, uh, chances that we could further increase our gearing ratio? And my second question is regarding, um,

Speaker 18: Just wonder, could management give us some color on the, you know, building the in-house green energy in Wulanchabu project, any progress in terms of building your own solar wind power and self-sufficiency rates, et cetera?

Um, the, uh, oil and trouble, uh, project. So we noticed some 12 wins, uh, policy toe wins in terms of the coordination of, uh, Computing and Powers. So just wonder, could management give us some color on the, you know, building the in-house, um, green energy in Woodland, top project? Any, um, progress in terms of building your own solar, wind, um, power and self-sufficient, self-sufficiency rates, etc.? Uh, no, thank you. Uh, uh, uh, excuse me for July. Uh,

Can see.

Xinyuan Liu: Let me take your first question on the gearing ratio. As we have disclosed in 2025, the net debt to EBITDA ratio was 4.3, which is within a robust level. As we see more demand from the market, we will to seize these opportunities. Again, we will try to balance the cadence, our financing, as well as the demand from the market. Like I said, we are going to tap into various means of financing channels. The key is to maintain our leverage ratio within a stable range.

Let me take your first question.

Um, on the hearing ratio, as we have disclosed, in 2025, the—uh,

Debt to EBITDA ratio was 4.3.

Um, which is within a, uh, robust level. Um, and, uh, as we see more demand from the market, uh, we will, um,

To see if these opportunities. But again, we will try to balance the cadence of our financing, uh, as well as the demand from the market. Um, like I said, we are going to tap into various means of financing channels. Um, so the key is to maintain our leverage ratio, uh, within a stable range.

Able range.

Xinyuan Liu: Uh,

uh,

to uh,

Xinyuan Liu: With regard to the green power or AI energy integrated projects, that is actually one of the key strategies for the company to provide integrated power and AI services for our clients. We do value the provision of clean power to our customers. We have the Wulanchabu project advancing steadily and that is going to be put into service by the end of the year. We are going to disclose the further progress in our future earnings calls. Thank you.

Xinyuan Liu: Next question, please.

With regard to the, uh, green power or, uh, AI energy integrated projects, um, that is actually, um, one of the key strategies for the company, uh, to provide integrated, uh, uh, power and AI services for our clients. And we do value the provision of green power to our, uh, customers. And we have, uh, uh, the, uh, volunteer project advancing steadily. And, uh, that is going to be, uh, put into service by the end of the year. And we are going to disclose the further progress, uh, in our future earnings calls. Thank you.

Operator 2: Thank you. Your next question comes from Qi Bin from CICC. Please go ahead.

Operator: Thank you. Your next question comes from Qi Bin from CICC. Please go ahead.

Next question, please.

Do your next question come from—she from CIC, please go ahead.

Xinyuan Liu: Thank you for taking my questions. Congratulations on the strong earnings. I have two questions. First, with the rapid development of the AI agent, the inference demand is expected to go up. In the long term, will we not adjust the plans for energy and land acquisitions, particularly in terms of regional structure? My second question is, in the last quarter, we met with large orders, including customers from internet, cloud, and smart driving. Looking at customer structure, what changes do management expect in 2026?

Thank you for checking my questions. Congratulations on the strong earnings. I have two questions. First, with the rapid development of the AI agent, the influence and demand is expected to set up and in the long term, will we need to adjust the plans for energy and land quarters? Particularly in terms of regional structure. My second question is, in the last quarter, we had one large order, including customers from Internet, cloud, and smart driving. Looking at customer structure, what changes does management expect in 2026?

Sharon Xiao Liu: 好的，谢谢您的问题。就我想肯定行业整个都看到了一个推理需求的增长，那公司也看到了，其实我们现在的客户，对于通算、智算，对于算力以及推理的需求，其实都在不断地增加。那我目前的数据中心也是在支持这几个方面的客户需求。那从市场布局的角度来说，实际上在区域上，就像刚刚介绍的，我们目前还是会重点地去看环京以及长三角的地区。那就像大家知道的世纪互联，其实我们也有城市型的数据中心，那我们也在积极地探讨未来是不是有边端的推理的需求。所以对于城市型的数据中心，那我们也是给客户积极地提供这种增值的服务，来满足这个边缘的推理的计算的需求。对，第二个问题呢，实际上世纪互联在批发业务的客户上还是非常丰富的。像您提到的，我们有这个通算智算的客户，包括互联网的客户，也包括云的客户，也包括AI云的客户。当然我们在整个的城市型的数据中心里也会有自动驾驶、金融类的客户。我们预计接下来这一年还是这样一个非常多样化的客户构成，我们给客户提供一个一揽子的服务。谢谢。

uh, 61

How?

um,

Xinyuan Liu: Thank you for your question. Indeed, the industry as a whole has witnessed an increase of demand from inferencing. Currently, the customers that we serve has demand for generic computing, smart computing or intelligent computing, as well as inferencing. Our current data centers are actually accommodating these demands. In terms of the geographic resource deployment, the top priority for us is the Greater Beijing area, as well as the Greater Yangtze River Delta region. As you know that VNET has retail city data centers, which is intended to provide inferencing and computing services for clients that is usually in the case of edge computing. These type of value-added services are in high demand among our clients.

Thank you. Um,

For your question. So, indeed the industry as a whole has witnessed the increase of demand for uh, inferencing and uh, currently uh, clients that we are the customers that we serve. Uh, has demand for generic Computing, smart computer or intelligent commuting as well as inferencing and our, our current data centers are actually accommodating these demands. And in terms of the geographic, uh, resource deployment, um, the top priority for us is the greater Beijing area, um, as well as the greater, uh, yansa River Delta Region. Um, as you know, that v-net has uh, uh, retail, uh, city data centers, which is intended to provide, um, inferencing and Computing Services, uh, for clients. Um, that is usually in the case of edge Computing. Um,

Xinyuan Liu: Going forward, actually, like I said, we have a variety of customers in terms of the mix of our customers. Some of them are leading internet giants, hyperscalers, as well as AI cloud providers. Like I said, we are going to provide a comprehensive solution that is going to meet the demand of all kinds of customers. Like I mentioned, the edge computing service that's needed by some autonomous driving companies, as well as financial companies. We are using our retail city data center to accommodate these types of needs. We believe we are going to provide a full-scale one-stop solution to our customers.

So these type of value added services are in high demand, among our clients. Um and um going forward actually, like I said we have a, uh, variety of customers in terms of the mix of our customers. They are some of them are uh, leading internet Giants. Uh hyperscalers, as well as AI clients.

A cloud providers. Um, but uh, like I said, we are going to provide a comprehensive solution that is going to meet in the demands of all kinds of customers. Like I mentioned the, uh, uh, Edge Computing service that's needed by some autonomous driving, uh, companies, as well as Financial companies, we are using our, uh, retail city data center, to accommodate these type of need. Uh, we believe we're going to provide a full scale. Uh, 1 like a food, stop solution to our customers.

Xinyuan Liu: Next question, please.

Next question, please.

Operator 2: Thank you. Your next question comes from Sarah Wang at UBS. Please go ahead.

Operator: Thank you. Your next question comes from Sarah Wang at UBS. Please go ahead.

See you. Next question comes from Sarah Wang at UBS.

Please go ahead.

Speaker 19: Thank you for the opportunity to ask a question. Again, congratulations on the solid results. I have two questions. First of all, I think last year, the central NDRC imposed a window guidance on new power quota release. May I have an update on the latest data? Where, what's the process of acquiring new power quota? Are we still under window guidance from the central government? Then second question is on competition. Given the strong demand, how shall we think about the rental fee trend? Do we expect the rental fee to increase? Or, in other words, usually in previous up cycle, when demand is quite strong, there could be some new entrants.

Sarah Wang: Thank you for the opportunity to ask a question. Again, congratulations on the solid results. I have two questions. First of all, I think last year, the central NDRC imposed a window guidance on new power quota release. May I have an update on the latest data? Where, what's the process of acquiring new power quota? Are we still under window guidance from the central government? Then second question is on competition. Given the strong demand, how shall we think about the rental fee trend? Do we expect the rental fee to increase? Or, in other words, usually in previous up cycle, when demand is quite strong, there could be some new entrants.

Um, thank you for the opportunity to ask a question and, uh, again, congratulations on the solid results. Um, I have two questions. Um, so first of all, I think, uh, last year, the central NDRC imposed a window guidance on new power quota release. Um, may I have an update on, uh, the latest status, um, whether, uh, what's the process of, um, acquiring new power quota? Do we still— and, uh, are we still under, uh, window guidance from the central government? And then second question is, um, competition. So, given the strong demand, how shall we think about, um, the, uh, rental fee trend? Uh, do we expect the rental fee to increase or—

Speaker 19: Just wondering what's the latest observation from the management's perspective.

Sarah Wang: Just wondering what's the latest observation from the management's perspective.

Speaker 20: 感谢提问的机会。非常恭喜公司取得强劲的业绩。我有两个问题，第一个问题是关于中央政府的窗口指导，我们新能评的获取最新是一个什么样的状况？是需要什么样的一个审核的流程。第二个问题呢，是关于竞争。基于这个AI的需求非常的强劲，我们是否会预期看到租金上涨，又或者说我们也看到行业里有一些新的竞争的进入者，那请管理层能不能分享一下你们最新的这个观点？谢谢。

Sharon Xiao Liu: 感谢提问的机会。非常恭喜公司取得强劲的业绩。我有两个问题，第一个问题是关于中央政府的窗口指导，我们新能评的获取最新是一个什么样的状况？是需要什么样的一个审核的流程。第二个问题呢，是关于竞争。基于这个AI的需求非常的强劲，我们是否会预期看到租金上涨，又或者说我们也看到行业里有一些新的竞争的进入者，那请管理层能不能分享一下你们最新的这个观点？谢谢。

Sharon Xiao Liu: 好的，谢谢Sarah。关于发改委的这个能评的窗口指导，我们觉得这还是一个非常好的政策，可以更好地去保持市场的供需平衡，而且是有利于我们这种Tier 1的数据中心的供应商的。的确现在坦白讲窗口指导呢，现在整体的通过率还是比较低的，但是世纪互联呢，其实我们也是在Q4的时候，我们环京的数据中心还是拿到了窗口指导的批复的，我们未来也会按照我们这个整体的一个策略吧，继续去申请新的资源，在窗口指导下拿到这个能评。关于行业的供需关系以及对租金的上涨呢，我们觉得现在首先Tier 1的这些player还是有比较大的优势，因为我们有比较良好的客户关系，可以去判断客户的一些布局，那我们提前也做好资源的获取，能够更好地去match客户的需求。那目前从行业的角度来说，我们觉得整体的价格是趋于稳定的，如果长远来看，随着行业的这个供给的收紧，那我们也希望能够进一步的可以看到这个供需的改善，那市场价格呢能够先企稳，然后未来有一些上升的趋势，这个是比较乐观的预期。但是目前来看，近一年我们觉得价格是相对稳定的。谢谢。

uh,

Xinyuan Liu: Thank you, Sarah, for your question. We actually view the window guidance from NDRC as favorable policy for us. Because that is going to affect the supply and demand dynamics in the market. However, as the Tier 1 data center provider, I think the window guidance is favoring us. As we did notice that the approval rate from NDRC was quite low. On the good side, we have successfully got the approval for our data center application in our Greater Beijing area by the end of Q4. We are going to continue to apply for new power quotas according to our own rhythm. Looking at the rental costs, I think as the Tier 1 player, you know, we are well positioned because we have developed a very strong relationship with our existing customers and we can anticipate and learn about their needs and match their needs with our resources. That is, we are well positioned in that regard. I would say the overall rental cost is stable. As we see the supply and demand dynamics continue to tighten up and we might see the prices begin to stabilize first and then eventually to rise. Overall, that is my optimistic view on the overall trend. Again, overall, we are bullish on the future development.

Thank you, Sarah, for your question.

We actually view the window guidance from NDA NDRC as favorable policy for us, um, because that is going to affect the, uh, supply and demand, uh, dynamics in the market. However, as the Tier 1, uh, service, as the Tier 1 data center, uh, provider, uh, I think the window guidance is favoring us, um,

As we, uh, we didn't notice that the approval rate from NDRC was quite low. But, uh, uh, on the good side, we have successfully, uh, got the approval for our data center application, uh, in our S, uh, Greater Beijing area by the end of Q4. Um, and we are going to continue to apply for new, uh, power quotas. Um, according to our own reason and looking at, at the, uh, rental costs. Um, I think, uh, as the Tier 1 player, um, you know, we are well positioned,

Because we have developed a very stronger relationship with our existing customers, and we can anticipate and learn about their needs and match their needs with our resources. Uh, so that is, we are well positioned in that regard. Uh, I would say, the overall rental cost is, um, stable. Um, but as we see the supply and demand, uh, Dynamics continue to tighten up, and we might see the prices begin to, uh, stabilize first and then eventually to rise. But overall, that is my optimistic. Uh, uh,

View on the overall trend, but uh, again, overall we are, uh, bullish on the, uh, future development.

Sharon Xiao Liu: Thank you.

Thank you.

Operator 2: Ladies and gentlemen, that concludes our conference for today. Thank you for participating. You may now disconnect your lines.

Operator: Ladies and gentlemen, that concludes our conference for today. Thank you for participating. You may now disconnect your lines.

Ladies and gentlemen, that concludes our conference for today. Thank you for participating. You may now disconnect your lines.

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