Q1 2026 Full Truck Alliance Co Ltd Earnings Call

May 21, 2026

Speaker #1: Ladies and gentlemen, good day and welcome to Full Truck Alliance's First Quarter 2026 earnings conference call. Today's conference is being recorded. At this time, I would like to turn the conference over to Mao Mao, Head of Investor Relations.

Operator: Ladies and gentlemen, good day and welcome to Full Truck Alliance's Q1 2026 earnings conference call. Today's conference is being recorded. At this time, I would like to turn the conference over to Mao Mao, Head of Investor Relations. Please go ahead.

Operator: Ladies and gentlemen, good day and welcome to Full Truck Alliance's Q1 2026 Earnings Conference call. Today's conference is being recorded. At this time, I would like to turn the conference over to Mao Mao, Head of Investor Relations. Please go ahead.

Speaker #1: Please go ahead.

Speaker #2: Thank you, Operator. Please note that today's discussion will contain forward-looking statements relating to the company's future performance, which are intended to qualify for the safe harbor from liability as established by the US Private Securities Litigation Reform Act.

Mao Mao: Thank you, operator. Please note that today's discussion will contain forward-looking statements relating to the company's future performance, which are intended to qualify for the safe harbor from liability, as established by the US Private Securities Litigation Reform Act. Such statements are not guarantees of future performance and are subject to certain risks and uncertainties, assumptions, and other factors. Some of these risks are beyond the company's control and could cause actual results to differ materially from those mentioned in today's press release and discussion. A general discussion of the risk factors that could affect FTA's business and financial results is included in certain filings of the company with the SEC. The company does not undertake any obligation to update this forward-looking information except as required by law. During today's call, management will also discuss certain non-GAAP financial measures for comparison purposes only.

Speaker #2: Such statements are not guarantees of future performance and are subject to certain risks and uncertainties assumptions and other factors. Some of these risks are beyond the company's control and could cause actual results to defer materially from those mentioned in today's press release and discussion.

Speaker #2: A general discussion of the risk factors that could affect FTA's business and financial results is included in certain filings of the company with the SEC.

Speaker #2: The company does not undertake any obligation to update this forward-looking information, except as required by law. During today's call, management will also discuss certain non-GAAP financial measures for comparison purposes only.

Speaker #2: For a definition of non-GAAP financial measures and a reconciliation of GAAP to non-GAAP financial results, please see the earnings release issued earlier today. Joining us today on the call from FTA's senior management side are Mr. Hui Zhang, our founder, chairman, and CEO, and Mr. Simon Tai, our Chief Financing and Investment Officer.

Mao Mao: For a definition of non-GAAP financial measures and a reconciliation of GAAP to non-GAAP financial results, please see the earnings release issued earlier today. Joining us today on the call from FTA's senior management side are Mr. Hui Zhang, our Founder, Chairman, and CEO, and Mr. Simon Cai, our Chief Financing and Investment Officer. We will open the call to questions following a brief opening remarks from Mr. Zhang. As a reminder, this conference is being recorded. In addition, a webcast replay of this call will be available on FTA's investor relations website at ir.fulltruckalliance.com. I will now turn the call over to our Founder, Chairman, and CEO, Mr. Zhang. Please go ahead, sir.

Speaker #2: We will open the call to questions following brief opening remarks from Mr. Zhang. As a reminder, this conference is being recorded. In addition, a webcast replay of this call will be available on FTA's Investor Relations website at ir.fulltruckalliance.com.

Speaker #2: I will now turn the call over to our founder, chairman, and CEO, Mr. Zhang. Please go ahead, sir.

Speaker #3: 大家好，欢迎各位参加满帮2026年第一季度一级电话会。今年一季度在复杂多变的市场环境中，我们坚持高质量的发展和数字化创新，各项业务都稳步增长。

Hui Zhang: 大家好，欢迎各位参加满帮2026年第一季度业绩电话会。今年一季度，在复杂多变的市场环境中，我们坚持高质量的发展和数字化创新，各项业务都稳步增长。

Hui Zhang: [Foreign language]

Speaker #1: Hello, everyone. Thank you for joining us today for our first quarter 2026 earnings conference call. In the first quarter of 2026, amid a complex and rapidly evolving market environment, we remained committed to high-quality growth and digital innovation, driving steady business growth across the board.

Mao Mao: Hello, everyone. Thank you for joining us today for our Q1 2026 Earnings Conference Call. In Q1 2026, amid a complex and rapidly evolving market environment, we remained committed to high-quality growth and digital innovation, driving steady business growth across the board.

[Translator]: Hello, everyone. Thank you for joining us today for our Q1 2026 Earnings Conference Call. In Q1 2026, amid a complex and rapidly evolving market environment, we remained committed to high-quality growth and digital innovation, driving steady business growth across the board.

Speaker #3: 业务方面，量质提升。首先，生态净化策略成效显著，刺激行为分不足，新级分是双单用户的行为更加规范。运费保障机制帮助广大司机积极地解决了运费纠纷难题。用户体验和粘性不断提升，体验提升推动订单增长。本季度履约订单达到了5504万单，同比增长超过14%。货主商我们完善产品矩阵和产品心智。货主线下物流需求不断迁移到线上。发货货主平均月活达到311万人，同比增长13%。司机端履约司机月活和履约频次同步增长，履约率突破了44%。年同比涨了5个百分点，创新方面，货主AI助手开始与发货早车跟单场景深度融合，帮助货主降本增效。无人小车启动试点，车效不断提升，名单专线业务快速覆盖全国。QMove在海外四个国家顺利推进。我们力争为用户提供一站式的运力产品，拓展集团业务，未来长期的发展空间。

Hui Zhang: 业务方面，量质齐升。首先，生态进化策略成效显著。司机行为分、货主信用分使双端用户的行为更加规范。运费保障机制帮助广大司机积极地解决了运费纠纷难题，用户体验和粘性不断提升，企业提升推动订单增长。本季度履约订单达到了5,504万单，同比增长超过14%。货主让我们完善产品矩阵和产品心智。货主线下物流需求不断迁移到线上，发货货主平均月活达到311万人，同比增长13%。司机端履约司机月活和履约频次同步增长，履约率突破了44%，年同比涨了5个百分点。创新方面，货主AI助手开始与发货、找车、跟单场景深度融合，帮助货主降本增效。无人小车启动试点，车效不断提升。零单专线业务快速覆盖全国。QMove在海外四个国家顺利推进。我们立身为用户提供一站式的运力产品，拓展集团业务未来长期的发展空间。

Speaker #1: Operationally, we delivered meaningful improvements in both scale and quality. First of all, our ecosystem governance initiatives yielded notable results. Our credit rating programs for truckers and shippers have raised conduct standards on both sides of the platform, while our freight payment protection mechanism has substantially reduced payment dispute issues for truckers.

Mao Mao: Operationally, we delivered meaningful improvements in both scale and quality. First of all, our ecosystem governance initiatives yielded notable results. Our credit rating programs for truckers and shippers have raised conduct standards on both sides of the platform, while our freight payment protection mechanism has substantially reduced payment dispute issues for truckers, driving higher user satisfaction and retention. Our enhanced user experience also fueled order growth. Fulfilled orders reached 50.0 billion this quarter, up over 14% year-over-year. On the shipper side, we continue to enrich our product portfolio and deepen user mindshare, bringing more offline logistics demand onto our online platform. Average shipper MAUs reached 3.11 million this quarter, up 13% year-over-year. On the trucker side, both truckers activity and fulfillment frequency increased steadily, with overall fulfillment rate exceeding 44%, up five percentage points year-over-year.

[Translator]: Operationally, we delivered meaningful improvements in both scale and quality. First of all, our ecosystem governance initiatives yielded notable results. Our credit rating programs for truckers and shippers have raised conduct standards on both sides of the platform, while our freight payment protection mechanism has substantially reduced payment dispute issues for truckers, driving higher user satisfaction and retention. Our enhanced user experience also fueled order growth. Fulfilled orders reached 50.0 billion this quarter, up over 14% year-over-year. On the shipper side, we continue to enrich our product portfolio and deepen user mindshare, bringing more offline logistics demand onto our online platform. Average shipper MAUs reached 3.11 million this quarter, up 13% year-over-year. On the trucker side, both truckers activity and fulfillment frequency increased steadily, with overall fulfillment rate exceeding 44%, up five percentage points year-over-year.

Speaker #1: Driving higher user satisfaction and retention, our enhanced user experience also fueled order growth. For field orders, we reached 50.0 million this quarter, up over 14% year over year.

Speaker #1: On the ship side, we continued to enrich our product portfolio and deepen user mind share, bringing more offline logistics demand onto our online platform.

Speaker #1: Average shipper MAUs reached 3.11 million this quarter, up 13% year over year. On the trucker side, both truckers' activity and fulfillment frequency increased steadily, with the overall fulfillment rate exceeding 44%, up 5 percentage points year over year.

Speaker #1: On the innovation front, our AI shipper assistant is now deeply integrated into key workflows, including shipment posting, freight matching, and shipment tracking, helping shippers reduce costs and operate more efficiently.

Mao Mao: On the innovation front, our AI shipper assistant is now deeply integrated into key workflows, including shipment posting, freight matching, and shipment tracking, helping shippers reduce costs and operate more efficiently. We also launched pilot programs for autonomous delivery vehicles with unit economics improving. In addition, our less than truckload products have rapidly expanded to nationwide coverage via the transport capacity of dedicated line carriers, while QMove continues to gain traction across four international markets. Taken together, these initiatives reflected our commitment to provide users with one-stop end-to-end transportation solutions, unlocking new long-term growth opportunities.

Speaker #1: We also launched pilot programs for autonomous delivery vehicles, with unit economics improving. In addition, our less-than-truckload products have rapidly expanded to nationwide coverage via the transport capacity of dedicated line carriers, while QMove continued to gain traction across four international markets.

Speaker #1: Taken together, these initiatives reflected our commitment to provide users with one-stop, end-to-end transportation solutions, unlocking new long-term growth opportunities.

Speaker #3: 财务方面，整体经营实现高质量的稳健增长，收入结构持续优化。本季度公司总营收同比增长5个5.5百分点，至28.5亿元。除了满运保外，营收达到了20.2亿元，同比增长了17%。其中交易服务收入达到了13.9亿元，同比增长超过33%。经营性活动现金流入15.6亿元，同比大幅增长。企业经营韧性持续增强，为未来新技术、新业务的发展提供了结实的基础。展望未来，满帮将依托完善的产品矩阵、健康的生态，持续扩大双单用户的网络效应，并利用海量用户行为和交易数据，提升AI在物流全链路的应用价值和物流行业效能，为用户和股东带来长期回报。

Simon Cai: Financially, we achieved high-quality, solid growth while continuing to optimize our revenue mix. In Q1, total net revenues grew by 5.5% year-over-year to RMB 2.85 billion. Excluding freight brokerage services, net revenues reached RMB 2.02 billion, up 17% year-over-year. Notably, transaction services revenues reached RMB 1.39 billion, up more than 70% year-over-year. Net cash provided by operating activities increased significantly year-over-year to RMB 1.56 billion, reinforcing our operational resilience and building a strong foundation for future innovation and growth. Looking ahead, we will leverage our comprehensive product portfolio, healthy platform ecosystem, and growing network effects on both sides of the platform, coupled with our vast repository of user behavior and transaction data to deepen AI application across the full logistics value chain, driving industry-wide efficiency gains and creating long-term value for both our users and shareholders. Thank you all once again. That concludes our opening remarks.

[Translator]: Financially, we achieved high-quality, solid growth while continuing to optimize our revenue mix. In Q1, total net revenues grew by 5.5% year-over-year to RMB 2.85 billion. Excluding freight brokerage services, net revenues reached RMB 2.02 billion, up 17% year-over-year. Notably, transaction services revenues reached RMB 1.39 billion, up more than 70% year-over-year. Net cash provided by operating activities increased significantly year-over-year to RMB 1.56 billion, reinforcing our operational resilience and building a strong foundation for future innovation and growth. Looking ahead, we will leverage our comprehensive product portfolio, healthy platform ecosystem, and growing network effects on both sides of the platform, coupled with our vast repository of user behavior and transaction data to deepen AI application across the full logistics value chain, driving industry-wide efficiency gains and creating long-term value for both our users and shareholders. Thank you all once again. That concludes our opening remarks.

Speaker #1: Financially, we achieved high-quality, solid growth while continuing to optimize our revenue mix. In the first quarter, total net revenues grew by 5.5% year over year to RMB 2.85 billion.

Speaker #1: Excluding freight brokerage services, net revenues reached RMB 2.02 billion, up 17% year over year. Notably, transaction service revenues reached RMB 1.39 billion, up more than 33% year over year.

Speaker #1: Net cash provided by operating activities increased significantly year over year to RMB 1.56 billion, reinforcing our operational resilience and building a strong foundation for future innovation and growth.

Speaker #1: Looking ahead, we will leverage our comprehensive product portfolio, healthy platform ecosystem, and growing network effects on both sides of the platform, coupled with our vast repository of user behavior and transaction data, to deepen AI application across the full logistics value chain, driving industry-wide efficiency gains and creating long-term value for both our users and shareholders.

Speaker #1: Thank you all once again. That concludes our opening remarks. We would now like to open the call to Q&A. Operator, please.

Mao Mao: We would now like to open the call to Q&A. Operator, please.

[Translator]: We would now like to open the call to Q&A. Operator, please.

Speaker #4: Thank you. If you wish to ask a question, please press star one (*) on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two (*2).

Operator: Thank you. If you wish to ask a question, please press *1 on your telephone and wait for your name to be announced. If you wish to cancel your request, please press *2. If you're on a speakerphone, please pick up the handset to ask your question. For the benefit of all participants on today's call, if you wish to ask a question to management in Chinese, please immediately repeat your question in English. Your first question comes from Ronald Keung with Goldman Sachs. Please go ahead.

Speaker #4: If you're on speakerphone, please pick up the handset to ask your question. For the benefit of all participants on today's call, if you wish to ask your question to management in Chinese, please immediately repeat your question in English.

Speaker #4: Your first question comes from Ronald Kiong with Goldman Sachs. Please go ahead.

Speaker #5: 谢谢张会长和班里成。那想问一下，我看到我们一季度的这个履约订单呢，增长了14个点。那增速和上个季度相比就有一些明显的改善。那能分享这个主要驱动因素，还有对未来几个季度的大致的增速的这个看法吗？谢谢。那我翻译一下。Thank you, management, for taking my question. I want to ask about the year fulfilled order. This quarter, that grew 14% in the first quarter, so quite a notable acceleration compared to last quarter.

Ronald Keung: Thank you. Thank you, management, for taking my question. Want to ask about the fulfilled order this quarter that grew 14% in Q1. Quite a notable acceleration compared to last quarter. What are the key drivers behind this, and how do you view the outlook in the coming few quarters? Thank you.

Speaker #5: So, what are the key drivers behind this, and how do you view the outlook in the coming few quarters? Thank you.

Speaker #3: Thank you, Ronald. This is Simon Tsai from Full Truck Alliance. So, first quarter, fulfilled order growth accelerated to 14.3%. That's ahead of our by three key factors.

Simon Cai: Thank you, Ronald. This is Simon Cai from Full Truck Alliance. Q1 fulfilled order growth accelerated to 14.3%. That's ahead of our expectations, and that's primarily driven by three key factors. First, the impact of our platform governance initiatives continue to ease. The associated benefits began to come through. In Q4 of last year, we intensified the governance efforts targeting misclassified carpooling orders, freight reselling, and real name verification, which temporarily weighted on order growth during that period, as we communicated before. As we entered Q1, these measures transitioned into business as usual operations, and their drag on order growth is tapering off. More importantly, the structural improvements they have delivered across authenticity of freight demand, pricing discipline, and fulfillment reliability, are increasingly translating into tangible business momentum and re-accelerating order growth across our platform.

Speaker #3: First, the impact of our platform governance initiatives continues to ease, and the associated benefits have begun to come through. In the fourth quarter of last year, we intensified the governance efforts targeting freight reselling and real-name verification.

Speaker #3: This temporarily weighed on order growth during that period, as we communicated before. As we entered the first quarter, these measures transitioned into business-as-usual operations.

Speaker #3: And their drag on order growth is tapering off. More importantly, the structural improvements they have delivered across authenticity of freight demand, pricing discipline, and fulfillment reliability are increasingly translating into tangible business momentum.

Speaker #3: And re-accelerating order growth across our platform. This is the primary factor behind the acceleration in order growth in the first quarter. And secondly, recent oil price volatility has highlighted our platform's advantage in transparent, efficient, and price discovery.

Simon Cai: This is the primary factor behind the acceleration in order growth in Q1. Secondly, recent oil price volatility has highlighted our platform's advantage in transparent, efficient, and price discovery. As fuel prices climbed sharply from March onward and drove greater freight cost volatility, offline freight brokers and relationship-based trucking network struggled to pass through these cost increases to shippers in a timely and transparent manner. By contrast, our platform enables real-time supply and demand-driven price discovery given our large verified trucker base, delivering more transparent and competitive pricing in highly dynamic market conditions. This superior pricing mechanism accelerated shipper migration from offline channels onto our platform, fueling a sharp rebound in shipping demand in the latter part of Q1. Thirdly, enhanced operational efficiency drove a systemic improvement in fulfillment frequency across our user base.

Speaker #3: As fuel prices climbed sharply from March onward and drove greater freight cost volatility, offline freight brokers and relationship-based trucking networks struggled to pass through these cost increases to shippers in a timely and transparent manner.

Speaker #3: By contrast, our platform enables real-time, supply- and demand-driven price discovery given our large, verified trucker base, delivering more transparent and competitive pricing in highly dynamic market conditions.

Speaker #3: This superior pricing mechanism accelerated shipper migration from offline channels onto our platform, fueling a sharp rebound in shipping demand in the latter part of the first quarter.

Speaker #3: And thirdly, enhanced operational efficiency drove a systemic improvement in fulfillment frequency across our user base. Throughout the first quarter, we continued investing in key product lines and operational initiatives.

Simon Cai: Throughout Q1, we continued investing in key product lines and operational initiatives. Notable examples include multiple iterations of our new freight zone feature, the extension of freight payment protection to our entire trucker base, including non-members, and deeper integration of our instant cargo function with our trucker credit rating program. Together, these efforts strengthened our service capabilities across the full value chain and spanning freight posting, matching, and fulfillment protection. The data makes this clear. Every shipper segment, including both broker and direct shippers, delivered double-digit year-over-year growth in fulfilled orders in Q1, reflecting steady gains in user stickiness and repeat order frequency within an increasingly healthy platform ecosystem.

Speaker #3: Notable examples include multiple iterations of our new freight zone feature. The extension of freight payment protection to our entire trucker base, including non-members, and deeper integration of our car of our instant cargo function with our trucker credit rating program.

Speaker #3: Together, these efforts strengthened our service capabilities across the full value chain, spanning freight posting, matching, and fulfillment protection. The data makes this clear.

Speaker #3: The data makes this clear. Every shipper segment, including both broker and direct shippers, delivered double-digit year-over-year growth in fulfilled orders in the first quarter, reflecting steady gains in user stickiness and repeat order frequency within an increasingly healthy platform ecosystem.

Speaker #3: Looking ahead, we remain confident in sustaining solid growth in the coming quarters, supported by the continued benefits of our platform, governance initiatives, a growing share of orders from direct shippers, and deeper AI penetration across matching and fulfillment.

Simon Cai: Looking ahead, we remain confident in sustaining solid growth in the coming quarters, supported by the continued benefits of our platform, governance initiatives, a growing share of orders from direct shippers, and deeper AI penetration across matching and fulfillment. We are well-positioned to deliver high-quality, sustainable growth throughout the year. Thank you.

Speaker #3: We're well positioned to deliver high-quality, sustainable growth throughout the year. Thank you.

Speaker #5: Thank you, Simon.

Ronald Keung: Thank you, Simon.

Speaker #4: Thank you. Your next question comes from anyone with Morgan Stanley. Please go ahead.

Operator: Thank you. Your next question comes from Eddy Wang with Morgan Stanley. Please go ahead.

Eddy Wang: Eddy Wang. From March onward, geopolitical-driven oil price volatility has pressured truckers' transportation costs. Has the company observed an impact on the platform, and what are the key measures taken in response? Thank you, Eddie. Regarding the impact of transportation cost volatility on our platform, we believe that in the near future, the pass-through of higher fuel costs to freight rates may prompt some shippers of low-value goods to reduce or defer shipments, which could lead to some softening in long-haul freight demand. Over the longer term, however, with the online penetration of road freight still extremely low, the structural opportunity to help shippers reduce logistics costs and win shares from offline channels far outweigh the near-term headwind from oil price-driven demand pressure. In response to the oil price surge in March, we took several steps to protect trucker economics and prevent additional cost burden on truckers.

Speaker #5: John Huizong, Simon Zong, Mao Mao Zong, Emma, a, 你们好。感谢接受我的提问。那我的提问是关于油价的，因为我们看到3月底呢，因为这个地缘政治的影响，油价的波动是非常剧烈。呃，对司机运输成本带来一定的压力，所以，呃，就是我们有看到就是对平台，啊，这个油价的上升有什么影响吧。然后如果有的话，我们主要的应对措施有哪些？啊，那我也自己翻译一下。呃，From March onward, 呃，geopolitical-driven oil price volatility has pressured truckers' transportation cost. Has the company observed an impact on the platform, and what are the key measures taken in response?

Speaker #5: Thank you.

Speaker #3: Thank you, Eddie. Regarding the impact of transportation cost volatility on our platform, we believe that in the near future, the pass-through of higher fuel costs to freight rates may prompt some shippers of low-value goods to reduce or defer shipments, which could lead to some softening in long-haul freight demand.

Simon Cai: Thank you, Eddie. Regarding the impact of transportation cost volatility on our platform, we believe that in the near future, the pass-through of higher fuel costs to freight rates may prompt some shippers of low-value goods to reduce or defer shipments, which could lead to some softening in long-haul freight demand. Over the longer term, however, with the online penetration of road freight still extremely low, the structural opportunity to help shippers reduce logistics costs and win shares from offline channels far outweigh the near-term headwind from oil price-driven demand pressure. In response to the oil price surge in March, we took several steps to protect trucker economics and prevent additional cost burden on truckers.

Speaker #3: Over the longer term, however, with the online penetration of freight—road freight still extremely low—the structural opportunity to help shippers reduce logistics costs and win shares from offline channels so far outweighs the near-term headwind from oil price-driven demand pressure.

Speaker #3: In response to the oil price surge in March, we took several steps to protect trucker economics and prevent additional cost burden on truckers. For example, we implemented a freight rate–fuel price linkage mechanism to keep freight rates aligned with rising fuel costs.

Simon Cai: For example, we implemented a freight rate fuel price linkage mechanism to keep freight rates aligned with rising fuel costs, including raising both the reference freight rate and bidding floor prices. In parallel, we launched a broad shipper outreach campaign on our apps to raise awareness of the fuel price environment and promote fair bidding practices. Additionally, we continue to leverage our fueling business to help truckers manage fuel costs. Over the past few years, we have steadily extended our fueling network to approximately 12,000 gas stations. Building on this foundation, we achieved a significant milestone in our core energy network strategy. In late April, we formally entered into a strategic cooperation agreement with Sinopec. This partnership has already gone live across Jiangsu, Zhejiang, and Anhui provinces, with over 3,000 Sinopec stations now accessible on our platform. We expect to meaningfully expand this network through the remainder of this year.

Speaker #3: Including raising both the reference freight rate and bidding floor prices. In parallel, we launched a broad shipper outreach campaign on our apps to raise awareness of the fuel price environment and promote fair bidding practices.

Speaker #3: Additionally, we continue to leverage our fueling business to help truckers manage fuel costs. Over the past few years, we have steadily expanded our fueling network to approximately 12,000 gas stations.

Speaker #3: Building on this foundation, we achieved a significant milestone in our core energy network strategy. In late April, we formally entered into a strategic cooperation agreement with Sinopec.

Speaker #3: And this partnership has already gone live across Jiangsu, Zhejiang, and Anhui provinces, with over 3,000 Sinopec stations now accessible on our platform. We expect to meaningfully expand this network through the remainder of this year.

Speaker #3: Our fueling business operates under an asset-light facilitation model. Leveraging on our platform, we are able to secure preferential fuel rates below prevailing benchmark prices from gas stations and partners, and pass these through to verified truckers as exclusive discounts, net of a modest service fee.

Simon Cai: Our fueling business operates under an asset-light facilitation model. Leveraging on our platform, we are able to secure preferential fuel rates below prevailing benchmark prices from gas stations partners, and pass these through to verified truckers as exclusive discounts, net of a modest service fee. We also complement this offering with flexible subsidy programs calibrated to market conditions to help truckers reduce costs further. For truckers, our model meaningfully lower per trip fuel expenses and provides tangible cash flow relief during a period of surging oil prices. In this way, it not only serves as a practical economic buffer for the truckers, but also solidifies the effective trucker supply and fulfillment capacity across our platform. For FTA, our matching capabilities extend naturally beyond freight transactions into post-freight service scenarios such as fueling and broadening our service ecosystem while deepening trucker engagement and stickiness throughout the entire transportation journey.

Speaker #3: We also complement this offering with flexible subsidy programs calibrated to market conditions to help truckers reduce costs further. For truckers, our model meaningfully lowers per-trip fuel expenses.

Speaker #3: And provides tangible cash flow relief during a period of certain oil prices. In this way, it not only serves as a practical economic buffer for the truckers, but also solidifies the effect on the active trucker supply and fulfillment capacity across our platform.

Speaker #3: For FTA, our matching capabilities extend naturally beyond freight transactions into post-freight service scenarios, such as fueling, and broaden our service ecosystem while deepening trucker engagement and stickiness throughout the entire transportation journey.

Speaker #3: Looking ahead, we will continue to broaden and deepen our fueling network and expand strategic partnerships with key partners such as Sinopec in an elevated diesel price environment.

Simon Cai: Looking ahead, we will continue to broaden and deepen our fueling network and expand strategic partnerships with key partners such as Sinopec in an elevated diesel price environment. The value proposition of our fueling business becomes increasingly compelling for truckers, and we are also confident that we can turn external fuel price volatility into an opportunity to grow our value-added services, enabling truckers on our platform to secure freight efficiently while meaningfully lowering their overall operating costs. Thank you.

Speaker #3: The value proposition of our fueling business becomes increasingly compelling for truckers, and we're also confident that we can turn excellent fuel price volatility into an opportunity to grow our value-added services, enabling truckers on our platform to secure freight efficiently while meaningfully lowering their overall operating costs.

Speaker #3: Thank you.

Speaker #5: Thank ank you.

Speaker #4: Thank you. Your next question comes from Ryan Gong with Citi. Please go ahead.

Eddy Wang: Thank you.

Operator: Thank you. Your next question comes from Brian Gong with Citi. Please go ahead.

Speaker #5: Shishi, John, Huizong, Simon Zong, Mao Mao Zong, Emma. Uh, 晚上好。Uh, 感谢接受我的提问。首先恭喜非常好的业绩啊。然后我想问一下关于这个履约率的，一季度的履约率的情况，这个趋势是怎么样的？以及我们未来该如何展望这一指标的一个变化趋势。那我很快翻译一下。Uh, my question is about fulfillment rate. How did the fulfillment rate change during the first quarter?

Brian Gong: My question is about fulfillment rate. How did the fulfillment rate change during the Q1, and how does management expect this metric to evolve going forward? Thank you. Thank you, Brian. In the Q1, the overall fulfillment rate was 44.1%, and it's up 4.9 percentage points year over year and 1.4 percentage points quarter over quarter. It also set another new record. Notably, the average fulfillment rate for low and medium frequency direct shippers remain at a strong level of nearly 65%. The improvement in fulfillment rates reflects the combined effects of multiple initiatives driven primarily by 3 key factors: optimized order mix, enhanced operational measures, and ecosystem governance. First of all, the continued optimization in order mix is the primary driver. In the Q1, fulfilled orders from direct shippers accounted for a growing share of total fulfilled orders.

Brian Gong: My question is about fulfillment rate. How did the fulfillment rate change during the Q1, and how does management expect this metric to evolve going forward? Thank you.

Speaker #5: And how does management expect this metric to evolve going forward? Thank you.

Speaker #3: Thank you, Brian. In the first quarter, the overall fulfillment rate was 44.1%. It's up 4.9 percentage points year over year, and 1.4 percentage points quarter over quarter.

Brian Gong: Thank you, Brian. In the Q1, the overall fulfillment rate was 44.1%, and it's up 4.9 percentage points year over year and 1.4 percentage points quarter over quarter. It also set another new record. Notably, the average fulfillment rate for low and medium frequency direct shippers remain at a strong level of nearly 65%. The improvement in fulfillment rates reflects the combined effects of multiple initiatives driven primarily by 3 key factors: optimized order mix, enhanced operational measures, and ecosystem governance. First of all, the continued optimization in order mix is the primary driver. In the Q1, fulfilled orders from direct shippers accounted for a growing share of total fulfilled orders.

Speaker #3: It also set another new record. Notably, the average fulfillment rate for low- and medium-frequency direct shippers remained at a strong level of nearly 65%.

Speaker #3: The improvement in fulfillment rates reflects the combined effects of multiple initiatives, driven primarily by three key factors: optimized order mix, enhanced operational measures, and ecosystem governance.

Speaker #3: First of all, the continued optimization in order mix is the primary driver. In the first quarter, fulfilled orders from direct shippers accounted for a growing share of total fulfilled orders.

Speaker #3: Direct shippers typically hold higher standards for fulfillment reliability and demonstrate strong execution commitment, making their growing share a direct contributor to the improvement in the platform's overall fulfillment performance.

Simon Cai: Direct shippers typically hold higher standards for fulfillment reliability and demonstrate strong execution commitment, making their growing share a direct contributor to the improvement in the platform's overall fulfillment performance. More encouragingly, fulfillment rates among professional shippers, the 1688 members, also improved year-over-year and quarter-over-quarter in Q1 2026. This 1688 cohort has historically lagged behind direct shippers in terms of fulfillment rate, the progress here is particularly meaningful. The improvement in Q1 was driven by three factors. Ongoing benefits from platform governance. As mentioned earlier, we cleaned up a number of platform integrity issues that is related to the users, including misclassified carpooling orders, cargo reselling, and suspiciously low-priced freight listing. This has materially strengthened overall fulfillment reliability on the platform. Structural improvement in the 1688 shipper base.

Speaker #3: Second, and more encouragingly, fulfillment rates among professional shippers, the 1,688 members, also improved year over year and quarter over quarter, this in first quarter 2026.

Speaker #3: This 1688 cohort has historically lagged behind direct shippers in terms of fulfillment rate, so the progress here is particularly meaningful. The improvement in the first quarter was driven by three factors.

Speaker #3: First, ongoing benefits from platform governance. As mentioned earlier, we cleaned up a number of platform integrity issues. That is related to the users, including misclassified carpooling orders.

Speaker #3: Cargo reselling and suspiciously low-priced freight listing. This has materially strengthened overall fulfillment reliability on the platform. Second, structural improvement in the 1688 shipper base.

Speaker #3: As real-name verification, shipper star rating, and abnormal other behavior surveillance become part of our regular operations, lower-quality shipper users naturally started to leave the platform.

Simon Cai: As real name verification, shipper star rating, and abnormal order behavior surveillance become part of our regular operations, lower quality shipper users naturally started to leave the platform. The shippers who have stayed are showing more genuine shipping demand and stronger fulfillment intent. Thirdly, we made a series of targeted product and operational improvements. This includes a rebuilt shipping workflow within the shipper and mini program and a secondary confirmation step for new freight listings. Paired with upgrades to our matching algorithm, these upgrades drove structural improvements in matching efficiency and fulfillment conversion for professional shippers across standard shipping scenarios. We continue to step up investment in key operational initiatives.

Speaker #3: The shippers who have stayed are showing more genuine shipping demand and stronger fulfillment intent. And third, thirdly, we made a series of targeted product and operational improvements.

Speaker #3: This includes a rebuild, shipping workflow within the shipper and mini program, and a secondary confirmation stack for new freight listings. Paired with upgrades to our matching algorithm, these upgrades drove structural improvements in matching efficiency and fulfillment conversion for professional shippers across standard shipping scenarios.

Speaker #3: We continue to set up investment, step up investment in key operational initiatives. In the first quarter, upgrades to truck-facing mechanisms such as expanding freight protection, coverage, and deepening integration of instant cargo and trucker credit rating strengthened truckers' willingness to accept orders and bolster fulfillment reliability.

Simon Cai: In Q1, upgrades to truck-facing mechanisms such as expanding freight protection coverage and deepening integration of instant cargo and trucker credit rating strengthen truckers' willingness to accept orders and bolster fulfillment reliability, that translate to a meaningful uplift in our platform-wide fulfillment rate. Looking ahead, we would continue the refinement of our credit rating system, further expansion of our direct shipper base, ongoing phase out of low-quality freight listings, and deeper AI applications across both matching and fulfillment. We expect fulfillment rates to continue on a steady upward trajectory. Thank you.

Speaker #3: And that translates to a meaningful uplift in our platform-wide fulfillment rate. Looking ahead, with continued refinement of our credit rating system, further expansion of our direct shipper base, the ongoing phase-out of low-quality freight listings, and deeper AI applications across both matching and fulfillment, we expect fulfillment rates to continue on a steady upward trajectory.

Speaker #3: Thank you.

Operator: Thank you. Your next question comes from Thomas Chong with Jefferies. Please go ahead.

Speaker #4: Thank you. Your next question comes from Thomas Zhong with Jeffreys. Please go ahead.

Speaker #6: 晚上好，谢谢管理层接受我的提问。呃，一季度我们看到发货货主月活 311 万，同比增长 12.7%，主要驱动的因素是什么？呃，let me translate myself。呃，In the first quarter, average shipper MAU reached 3.11 million, representing a year-over-year increase of 12.7%. What were the primary drivers behind this growth?

Thomas Chong: Let me translate myself. In Q1, average shipper MAU reached 3.11 million, representing a year-over-year increase of 12.7%. What were the primary drivers behind this growth? Thank you.

Speaker #6: Thank you.

Speaker #3: Thank you, Thomas. Shipper MAUs continue to deliver double-digit growth in the first quarter, mainly driven by three factors: sustained gains in customer acquisition efficiency, expanding product benefits, and strengthened user trust.

Simon Cai: Thank you, Thomas. Shipper MAUs continue to deliver double-digit growth in Q1, mainly driven by 3 factors: sustained gains in customer acquisition efficiency, expanding product benefits, and strengthened user trust. First, multi-channel user acquisition strategy continued to fuel our MAU expansion, with overall acquisition efficiency elevating steadily. In terms of channel mix, app stores, information feed ads, and cross-brand partnerships remained the primary contributors. Specifically, the App Store channel continued to deliver strong acquisition efficiency thanks to our ongoing optimization across campaign management, keyword strategy, and the download page and conversion funnel. This also reflects the growing brand awareness and conversion power of the FTA brand among our target shipper base. Information feed and SCM brand channels also delivered robust year-over-year growth in Q1, with targeted reach ROI trending higher.

Speaker #3: First, our multi-channel user acquisition strategy continued to fuel our MAU expansion, with overall acquisition efficiency elevating steadily. In terms of channel mix, app stores, information feed ads, and cross-brand partnerships remain the primary contributors.

Speaker #3: Specifically, the app store channel continued to deliver strong acquisition efficiency, thanks to our ongoing optimization across campaign management, keyword strategy, and the download page and conversion funnel.

Speaker #3: This also reflects the growing brand awareness and conversion power of the FTA brand among our target shipper base. Information Feed and SCM brand channels also delivered robust year-over-year growth.

Speaker #3: In the first quarter, with targeted reach ROI trending higher, meanwhile cross-band partnership channels sustained solid growth, reflecting the initial success of our ecosystem collaboration efforts and our ability to integrate external traffic.

Simon Cai: Meanwhile, cross-brand partnership channels sustained solid growth, reflecting the initial success of our ecosystem collaboration efforts and our ability to integrate external traffic. Second, by layering scenario-specific benefits on top of our core capabilities, we have effectively lowered the barrier to entry for shippers and deepened user stickiness. The foundational infrastructure we have built over time across intelligent matching, fulfillment protection, and freight pricing represents the bedrock of our ability to consistently attract and retain SME shippers. In Q1, while continuing to strengthen the long-haul transportation experience, we also introduced targeted product benefits for specific use cases. For example, a fee waiver for order posting within 200 km. These initiatives further lowered the onboarding threshold for smaller shippers and ensure a reliable service experience across a broader range of transportation scenarios. Third, our recon operations and referral-driven acquisitions have solidified into a powerful dual-engine for user growth.

Speaker #3: Second, by layering scenario-specific benefits on top of our core capabilities, we have effectively lowered the barrier to entry for shippers and deepened user stickiness.

Speaker #3: The foundational infrastructure we have built over time across intelligent matching, fulfillment protection, and freight pricing represents the bedrock of our ability to consistently attract and retain SME shippers.

Speaker #3: In the first quarter, while continuing to strengthen the long-haul transportation experience, we also introduced targeted product benefits for specific use cases. For example, a fee waiver for order posting within 200 kilometers.

Speaker #3: And these initiatives further lowered the onboarding threshold for smaller shippers and ensured a reliable service experience across a broader range of transportation scenarios. Third, our Wecon operations and referral-driven acquisitions have solidified into a powerful dual engine for user growth.

Speaker #3: In the first quarter, we continued to scale our Wecon outreach, leveraging high-frequency targeted engagement to effectively reactivate our existing user base. Notably, peer-to-peer referrals—i.e., existing shippers bringing in new ones—remain our highest ROI and highest quality acquisition channel.

Simon Cai: In Q1, we continued to scale our recon outreach, leveraging high-frequency targeted engagement to effectively reactivate our existing user base. Notably, peer-to-peer referrals, i.e., existing shippers bringing in new ones, remaining our highest ROI and highest quality acquisition channel. Shippers acquired through referrals consistently outperform platform average on key metrics, including order fulfillment rates, and long-term retention. Looking into the rest of the year, we will sharpen our focus on the quality and sustainability of user growth through continued strong execution of our multi-pronged user acquisition strategy, anchored in branding, product benefits, and referral-driven programs. We will keep refining our channel mix and rolling out scenario-specific product benefit to elevate acquisition efficiency and strengthen our brand presence among targeted users. In addition, we will deepen our commitment to user satisfaction, bolstering our service capabilities and protection mechanisms to strengthen trust and reinforce our professional reputation.

Speaker #3: Shippers acquired through referrals consistently outperform the platform average on key metrics, including order fulfillment rates and long-term retention. Looking into the rest of the year, we will sharpen our focus on the quality and sustainability of user growth through continued strong execution of our multi-pronged user acquisition strategy, anchored in branding, product benefits, and referral-driven programs.

Speaker #3: We will keep refining our channel mix and rolling out scenario-specific product benefits to elevate acquisition efficiency, and strengthen our brand presence among targeted users.

Speaker #3: In addition, we will deepen our commitment to user satisfaction, bolstering our service capabilities and protection mechanisms to strengthen trust and reinforce our professional reputation.

Speaker #3: Taken all together, these efforts will lay a solid foundation for sustainable and long-term growth. Thank you.

Simon Cai: Taken all together, these efforts will lay a solid foundation for sustainable and long-term growth. Thank you.

Speaker #4: Thank you. Your next question comes from Richie Sun with HSBC. Please go ahead.

Operator: Thank you. Your next question comes from Ritchie Sun with HSBC. Please go ahead.

Speaker #2: Zhang Huizhong, Simon Zhong, Mao Mao Zhong, Emma, 晚上好。呃，感谢你们给我提问的机会啊。呃，我有一个关于司机活跃度的这个问题啊。呃，这个一季度，呃，平台司机活跃的情况，这到底是如何？呃，活跃的司机在平台的接单的评测是否有进一步的提升？呃，thank you, management, for taking my questions. I want to ask about truckers’ activity. Can you share how trucker engagement trended in the first quarter, and has the order acceptance frequency among active truckers continued to improve?

Ritchie Sun: Thank you, management, for taking my questions. I want to ask about truckers' activeness. Can you share how trucker engagement trended in Q1? Has order acceptance frequency among active truckers continued to improve? Thank you.

Speaker #2: Thank you.

Speaker #3: Thank you, Richie. In the first quarter, transportation capacity across the platform remained abundant and the supply mix continued to improve. Monthly active truckers responding to orders held steady at about 3 million, providing a solid backbone for fulfillment on our platform.

Simon Cai: Thank you, Ritchie. In Q1, transportation capacity across the platform remained abundant, and the supply mix continued to improve. Monthly active truckers responding to orders held steady at about 3 million, providing a solid backbone for fulfillment on our platform. Within newly onboarded active trucker capacity, the share of new energy vehicles continues to grow, and supported by their lower operating costs and favorable policy tailwinds, they have emerged as an increasingly important supply source of high-quality carrier capacity on our platform. Besides, increasing order acceptance frequency among active truckers was one of our key operational priorities this Q1, underpinned by a series of systemic upgrades to our fulfillment protection mechanism and trucker-facing tools. First, freight payment protection has been extended to all truckers, significantly reducing fulfillment-related risk.

Speaker #3: Within newly onboarded active trucker capacity, the share of new energy vehicles continued to grow and was supported by their lower operating costs and favorable policy tailwinds.

Speaker #3: They have emerged as an increasingly important supply source of high-quality carrier capacity on our platform. Besides, increasing order acceptance frequency among active truckers was one of our key operational priorities this quarter.

Speaker #3: Underpinned by a series of systemic upgrades to our fulfillment protection mechanism and trucker-facing tools. First, freight payment protection has been extended to all truckers, significantly reducing fulfillment-related risks.

Speaker #3: We expanded the program from members-only truckers to our full trucker base, and it now covers more than 90% of the freight listings on the platform.

Simon Cai: We expanded the program from members-only truckers to our full trucker base, and it now covers more than 90% of the freight listings on the platform. For orders carrying the protection label, in the event of freight payment delays or defaults, the platform will proactively intervene to assist with recovery efforts. If the dispute remains unresolved after the overdue period, the platform will directly cover the shortfall. This mechanism has effectively addressed truckers' key concerns around payment security and significantly boosting their willingness to accept orders and loyalty to the platform. Second, we have deeply linked benefits with trucker credit rating to foster a healthier ecosystem. Specifically, core cargo-finding features such as our instant cargo function, are now directly tied to trucker credit rating, and truckers with stronger fulfillment records and higher service quality receive more reliable access to premium freight opportunities.

Speaker #3: For orders carrying the protection label, in the event of freight payment delays or defaults, the platform will proactively intervene to assist with recovery efforts.

Speaker #3: If the dispute remains unresolved after the overdue period, the platform will directly cover the shortfall. This mechanism has effectively addressed truckers' key concerns around payment security, significantly boosting their willingness to accept orders and their loyalty to the platform.

Speaker #3: Second, we have deeply linked benefits with trucker crediting rates. Credit rating to foster a healthier ecosystem. Specifically, core cargo finding features such as our instant cargo function are now directly tied to trucker credit rating.

Speaker #3: And truckers with stronger fulfillment records and higher service quality receive more reliable access to premium freight opportunities. This has created a powerful positive incentive mechanism on the capacity side of the platform.

Simon Cai: This has created a powerful positive incentive mechanism on the capacity side of the platform. Lastly, our accelerating deployment of AI capabilities is driving meaningful individual efficiency gains. We're currently piloting an AI assistant for truckers that provides intelligent support across high-frequency transactional touchpoints, such as cargo finding, price negotiation, and query resolution. The recent trucker data is encouraging. The average number of fulfilled orders per active trucker continued to rise year over year in Q1, while the median time to transaction completion remained near historical lows. This suggests that the convergence of increasing high-quality freight supply, ongoing matching algo iteration, and AI-powered tools enable truckers to respond to orders faster and chain trips more tightly, meaningfully improving overall vehicle utilization at the individual level. We will remain focused on enhancing the trucker experience, refining protection mechanisms, and upgrading tools and products.

Speaker #3: Lastly, our accelerating deployment of AI capabilities is driving meaningful individual efficiency gains. We're currently piloting an AI assistant for truckers across high-frequency transactional touchpoints, such as cargo query solutions.

Speaker #3: Resolution. The reason trucker data is encouraging: the average number of fulfilled orders per active trucker continues to rise year over year in the first quarter.

Speaker #3: While the median time to transaction completion remained near historical lows, this suggests that the convergence of increasing high-quality freight supply, ongoing matching iteration, and AI-powered tools enable truckers to respond to orders faster and chain trips more tightly, meaningfully improving overall vehicle utilization at the individual level.

Speaker #3: We will remain focused on enhancing the trucker experience, refining protection mechanisms, and upgrading tools and products. This means strengthening foundational systems such as freight payment protection and credit rating mechanisms to increase truckers' confidence in our fulfillment.

Simon Cai: This means strengthening foundational systems such as freight payment protection and credit rating mechanisms to increase truckers' confidence in our fulfillment. While also leveraging digital tools such as our AI assistant to improve truckers' order acceptance, efficiency, and unit economies. These initiatives will collectively strengthen our capacity base and support a sustained order growth, and increased fulfillment across our platform. Thank you.

Speaker #3: While also leveraging digital tools such as our AI assistant to improve truckers' order acceptance efficiency and unit economics, these initiatives will collectively strengthen our capacity base and support sustained growth, order growth, and increased fulfillment across our platform.

Speaker #3: Thank you.

Speaker #4: Thank you. Your next question comes from Wenjie Zhang with CICC. Please go ahead.

Operator: Thank you. The next question comes from Wenjie Zhang with CICC. Please go ahead.

Speaker #2: Hey, good morning, Zhang Hao. Thank you for 接受我的提问。我公司恭喜公司一季度取得这么好的业绩哈。然后我看到我们一季度的抽佣收入实现了33%的同比高增，然后我想问一下最主要的驱动因素是什么，以及如何看待未来抽佣收入的增长趋势。啊，然后我自己翻译一下。呃，thank you, management, for taking my question. We saw that commission revenue grew by 33% year over year in the first quarter.

Wenjie Zhang: Thank you, management, for taking my question. We saw that commission revenue grew by 33% year over year in Q1. What are the key drivers behind this, and what's the outlook for commission revenue going forward?

Speaker #2: What are the other key drivers behind this? And what's the outlook for commission revenue going forward?

Speaker #3: Thank you, Wenjie. As order volume growth gradually recovered in the first quarter, transaction service revenue remained strong, with growth momentum primarily driven by two factors.

Simon Cai: Thank you, Wenjie. As order volume growth gradually recovered in Q1, transaction services revenue maintained strong growth momentum, primarily driven by two factors. First, an increase in high-quality orders significantly improved the commission penetration rate, which was the core growth driver of transaction services revenue this quarter. In Q1, commission penetration rate exceeded 94%, up roughly 9 percentage points year-over-year. This sharp increase was largely attributable to our ecosystem governance efforts in prior quarters. As low quality and abnormal orders such as misclassified carpooling and cargo reselling are being structurally phased out, the supply of authentic high-quality orders has increased significantly, and fulfillment rates have reached new highs for several consecutive quarters. This has allowed our commission model to extend smoothly and sustainably into a broader range of business scenarios. Second, average monetization per order climbed at a moderate, healthy pace.

Speaker #3: First, an increase in high-quality orders significantly improved the commission penetration rate, which was the core growth driver of transaction service revenue this quarter. In the first quarter, commission penetration rate exceeded 94%, up roughly 9 percentage points year over year.

Speaker #3: This sharp increase was largely attributable to our ecosystem governance efforts in prior quarters. As low-quality and abnormal orders, such as misclassified carpooling and cargo reselling, are being structurally phased out, the supply of authentic, high-quality orders has increased significantly, and fulfillment rates have reached new highs for several consecutive quarters.

Speaker #3: This has allowed our commission model to extend smoothly and sustainably into a broader range of business scenarios. Second, average monetization per order climbed at a moderate, healthy pace.

Speaker #3: In the first quarter, average monetization per order reached roughly RMB 26.9, sustaining its steady year-over-year upward trend. And this growth is structurally very, very sound, underpinned by two factors.

Simon Cai: In Q1, average monetization per order reached roughly RMB 26.9, sustaining its steady year-over-year upward trend. This growth is structurally very sound, underpinned by two factors. First, the optimization of our tiered operations and refined pricing strategy continue to drive monetization efficiency within the existing commission scenarios. Second, there's a large volume of new orders has been brought into the commission system earlier this year. While these incremental orders generate lower initial commission rates and created modest near-term dilution, they present substantial monetization opportunities as we continue to drive higher average monetization per order over time. Looking ahead, we remain confident in the continued growth of our transaction services revenue. As newly monetized orders gradually mature and we continue to optimize our tier 2 refined operations, we believe there's still room for improvement in both commission penetration and average monetization per order.

Speaker #3: First, the optimization of our tiered operations and refined pricing strategy continue to drive monetization efficiency within the existing commission scenarios. Second, a large volume of new orders has been brought into the commission system earlier this year.

Speaker #3: While these incremental orders generate lower initial commission rates and create modest Newton dilution, they present substantial monetization opportunities as we continue to drive higher average monetization per order over time.

Speaker #3: Looking ahead, we remain confident in the continued growth of our transaction service revenue. As newly monetized orders gradually mature, and we continue to optimize our tiered refined operations, we believe there's still room for improvement in both commission penetration and average monetization per order.

Speaker #3: At the same time, ongoing enhancement to our trucker membership system and the normalization of ecosystem governance will keep our stable, high-quality capacity base in place.

Simon Cai: At the same time, ongoing enhancement to our trucker membership system and the normalization of ecosystem governance will keep a stable, high-quality capacity base in place, reinforcing the foundation for transaction services revenue growth. While maintaining our commitment to ecosystem health and user experience across both sides of the platform, we will continue to gradually optimize our monetization structure in driving transaction services revenue towards a more resilient and sustainable long-term growth trajectory. Thank you.

Speaker #3: Reinforcing the foundation for transaction service revenue growth. While maintaining our commitment to ecosystem health and user experience across both sides of the platform, we will continue to gradually optimize our resilient and sustainable long-term growth trajectory.

Speaker #3: Thank you.

Speaker #4: Thank you. Your next question comes from Yuan Liao with CITICS. Please go ahead.

Operator: Thank you. The next question comes from Yuan Miao with Citi. Please go ahead.

Yuan Miao: Thanks, Hui Zhang, Mao Mao. Thanks for taking my questions. Congratulations on the successful performance in Q1. We see that freight brokerage business significantly exceeded expectations in Q1. My question is, could management share the progress of the freight brokerage business transformation in Q1? I have another question about our AI. Given the current industry landscape where AI progress is mixed, I would like to ask how AI is currently being applied within the company. Specifically in Q1, what were the main advances? Do we have any plans for 2026? I can translate it myself. Thanks, management, for taking my questions. I have two questions. The first is, could management share an update on the progress of the freight brokerage business transformation in Q1?

Yuan Liao: Thanks, Hui Zhang, Mao Mao. Thanks for taking my questions. Congratulations on the successful performance in Q1. We see that freight brokerage business significantly exceeded expectations in Q1. My question is, could management share the progress of the freight brokerage business transformation in Q1? I have another question about our AI. Given the current industry landscape where AI progress is mixed, I would like to ask how AI is currently being applied within the company. Specifically in Q1, what were the main advances? Do we have any plans for 2026? I can translate it myself. Thanks, management, for taking my questions. I have two questions. The first is, could management share an update on the progress of the freight brokerage business transformation in Q1?

Speaker #5: Hey, uh,恭喜，呃，一季度取得强劲的业绩。呃，那我们看到一季度的话，其实公司的开票业务也是明显的超出了预期。呃，我的问题是，呃，我不知道管理层能不能分享一下。啊，我们开票业务一季度业务转型的一个进展如何。呃，然后我还有一个问题是关于我们的AI的。啊，想，呃，在当前的这个行业AI进展如火如荼的，呃，情况下，想问一下AI目前在公司的一个应用情况是如何。啊，那在一季度呢，主要有哪些进展？2026年我们有没有什么样的一些规划？啊，我简单自己翻译一下。Trans management for taking my questions, I have two questions. The first is to management share and update on the progress of business transformation in the first quarter.

Speaker #5: And second question is related to AI. And could you share how AI is being applied across your company? And what is the key development there in the first quarter?

Yuan Miao: Second question is related to AI, and could you share how AI is being applied across your company, and what is the key developments were in Q1, and what is your plan are for 2026? Thank you.

Yuan Liao: Second question is related to AI, and could you share how AI is being applied across your company, and what is the key developments were in Q1, and what is your plan are for 2026? Thank you.

Speaker #5: And what is your plan R for 2026? Thank you.

Speaker #3: Thank you, Yuan. So starting with the first question on freight brokerage, our freight brokerage business maintained stable operations in the first quarter, with ongoing improvements to both business structure and operating model.

Simon Cai: Thank you, Yuan. Starting with your first question on freight brokerage. Our freight brokerage business maintained stable operations in Q1 with ongoing improvements to both business structure and operating model. Beginning in this year, the business has formally transitioned into a dual-track model, operating its own proprietary business in parallel with aggregator model. Under the self-operated model, an extension of traditional freight brokerage business with revenue recognized on the freight brokerage business service item, FTA directly manages invoicing and settlement workflows. This model primarily serves SME shippers with genuine freight demand by providing a fully integrated end-to-end solution that combines VAT invoices issuance with freight matching. Operations have continued at their established pace, with take rate or service fee remaining stable at around 10%. Under the aggregator model, this is a newly introduced track with revenue recognized under Value-Added Services segment.

Speaker #3: Beginning in this year, the business has formally transitioned into a dual-track model, operating its own proprietary business in parallel with the aggregator model. Under the self-operated model, an extension of traditional freight brokerage business with revenue recognized on the freight brokerage business service item, FTA directly manages invoicing and settlement workflows.

Speaker #3: This model primarily serves SME shippers in generating freight demand by providing a fully integrated, end-to-end solution that combines VAT invoice issuance with freight matching.

Speaker #3: Operations have continued at their established pace, with take rate or service fee remaining stable at around 10%. Under the aggregator model, this is a newly introduced track, with revenue recognized under value-added services.

Speaker #3: That's invoicing. Invoicing and settlement are handled by qualified third-party ecosystem partners, while FTA focuses on the underlying freight matching and capacity allocation, earning a channel service fee of roughly 1% to 2% per order.

Simon Cai: Thus, invoicing and settlement are handled by qualified third-party ecosystem partners, while FTA focuses on the underlying freight matching and capacity allocation, earning a channel service fee of roughly 1% to 2% per order. This effectively repositioned the invoicing business from a GMV-driven model, where the platform previously assumed full invoicing and settlement obligations, to an SLI channel distribution model. From an operational standpoint, the decline of self-operated invoicing volume is the near-term outcome of our deliberate decision to reduce our self-operated exposure amid the evolving policy environment. From an asset quality perspective, the customers we retained under this model remain predominantly SOE shippers with genuine freight demand, with the invoicing plus freight matching orders representing the substantial majority of the transactions. Meanwhile, the aggregator model has ramped up steadily since the Q1 launch, with associated revenue beginning to flow through under the value-added services.

Speaker #3: This has effectively repositioned the invoicing business from a GMB-driven model, where the platform previously assumed full invoicing and settlement obligations, to an SLI channel distribution model.

Speaker #3: From an operational standpoint, the decline of self-operated invoicing volume is the near-term outcome of our deliberate decision to reduce our self-operated exposure amid the evolving policy environment.

Speaker #3: From an asset quality perspective, the customers we retained under this model remain predominantly SOE shippers with generating freight demand, with invoicing plus freight matching orders representing the substantial majority of the transactions.

Speaker #3: Meanwhile, the aggregator model has ramped up steadily since the first quarter launch, with associated revenue beginning to flow through under the value-added services.

Speaker #3: Strategically, the transition to a dual-track, self-operated and aggregator model delivers three distinct benefits. First, it maturely reduces direct exposure to regulatory policy risk.

Simon Cai: Strategically, the transition to a dual-track, self-operated, and aggregator model delivers 3 distinct benefits. First, it materially reduces direct exposure to regulatory policy risk. Under the aggregator model, the platform no longer bears direct invoicing and settlement obligations, fundamentally mitigating uncertainties from potential policy changes. Second, it enables an asset lighter operating profile and sharpens our focus on core freight matching capabilities while reducing both capital deployment and operating costs. Thirdly, it strengthens shipper retention. By leveraging aggregator partners to meet shippers' invoicing compliance needs, we're better positioned to keep users engaged within our freight matching ecosystem. Financially, the invoicing business was never intended to be a core profit center.

Speaker #3: Under the aggregator model, the platform no longer bears direct invoicing and settlement obligations, fundamentally mitigating uncertainties from potential policy changes. Second, it enables an excellent lighter operating profile and sharpens our focus on core freight matching capabilities while reducing both capital deployment and operating costs.

Speaker #3: Thirdly, it strengthens shipper retention. By leveraging aggregator partners to meet shippers' invoicing compliance needs, we're better positioned to keep users engaged within our freight matching ecosystem.

Speaker #3: Financially, the invoicing business was never intended to be a core profit center. Rather, it serves as an operational infrastructure that anchors shipper loyalty and broadens the boundaries of our ecosystem.

Simon Cai: Rather, it serves as a operational infrastructure that anchors shipper loyalty and broadens the boundaries of our ecosystem. What we prioritize is the boost from the freight brokerage business to our core freight matching activity and the structural improvement it brings to our user mix. Looking ahead, we will continue to gradually transition the freight brokerage business away from the self-operated model towards the aggregator model. This shift will ensure shippers' invoicing needs are continuously served while enabling the invoicing business to operate on a lighter, more sustainable footing within the evolving regulatory environment, better supporting the long-term development of our core platform business. That's the response to your first question. Moving on to your question on AI. In Q1, our AI initiatives advanced from exploratory phase to a stage of targeted capability refinement and focused testing.

Speaker #3: What we prioritize is the boost, from the freight brokerage business to our core freight matching activity, and the structural improvement it brings to our user mix.

Speaker #3: Looking ahead, we will continue to gradually transition the freight brokerage business away from the self-operated model towards the aggregator model. This shift will ensure shippers' invoicing needs are continuously served, while enabling the invoicing business to operate on a lighter, more sustainable footing within the evolving regulatory environment.

Speaker #3: Better supporting the long-term development of our core platform business. So that's, that's the response to your first question. Moving on to your question on AI.

Speaker #3: In the first quarter, our AI initiatives advanced from the exploratory phase to a stage of targeted capability refinement and focused testing. Centered on the core shipper transaction journey, we are progressively building an AI agent framework spanning the full transaction and fulfillment lifecycle.

Simon Cai: Centered on the core shipper transaction journey, we are progressively building an AI agent framework spanning the full transaction and fulfillment life cycle, and encompassing dedicated agents for shipment posting, freight matching, and order fulfillment, alongside with AI-powered customer service. Our key developments in the quarter were concentrated across the following product lines. For the shipment posting agent, we continued to build on last quarter's strategy around simplified posting and automated dispatch. We steadily expanded the pilot among direct shippers, sustaining a high end-to-end success rate. Pilot results show that fulfillment rates on AI-assisted posting were materially above average. That's a strong testament to the power of AI-driven matching in improving fulfillment efficiency. Looking ahead, we plan to introduce multimodal capabilities such as screenshot-based posting to further streamline the posting experience while integrating WECAN and open APIs to meet enterprise system integration needs and improve posting efficiency.

Speaker #3: and encompassing, dedicated agents for shipment posting, freight matching, and other fulfillment, alongside AI-powered customer service. Our key developments in the quarter were concentrated across the following product lines.

Speaker #3: For the shipment posting agent, we continue to build on last quarter's strategy around simplified posting and automated dispatch. We steadily expanded the pilot among direct shippers, sustaining a high end-to-end success rate. Pilot results show that fulfillment rates on AI-assisted posting were materially above average.

Speaker #3: That's a strong testament to the power of AI-driven matching in improving fulfillment efficiency. Looking ahead, we will plan to introduce multimodal capabilities, such as screenshot-based posting, to further streamline the posting experience.

Speaker #3: While integrating Wecom and OpenAPIs to meet enterprise system integration needs and improve posting efficiency. From our matching and fulfillment agents, for our matching and fulfillment agents, core underlying capabilities went live in the first quarter and since then we have continued to refine their performance across intelligent query, resolution, price negotiation, and complex scenario handling.

Simon Cai: For our matching and fulfillment agents, core underlying capabilities went live in Q1, and since then, we have continued to refine their performance across intelligent query resolution, price negotiation, and complex scenario handling. The matching agent focuses on dynamic negotiation strategies across varying transaction scenarios, alongside growing real-time voice interaction capabilities. This fulfillment agent centers on shipment tracking, intelligent customer support, and deep intervention in high-frequency exceptions such as late arrivals and cancellations, and steadily establishing an automated exception handling mechanism across the platform. On the trucker side, our AI assistant continued to support high-frequency decision points such as freight finding and price negotiation, and improving matching efficiency for truckers, and unlocking latent capacity on the platform. Meanwhile, we continue to improve issue resolution efficiency and response speed within our AI-powered customer service system, driving structural improvements in both overall service quality and operating expenses.

Speaker #3: The matching agent focuses on dynamic negotiation strategies across varying transaction scenarios, alongside growing real-time voice interaction capabilities. This fulfillment agent centers on shipment tracking, intelligent customer support, and deep intervention in high-frequency exceptions, such as late arrivals and cancellations.

Speaker #3: And steadily establishing an automated exception handling mechanism across the platform. On the trucker side, our AI assistant continued to support high-frequency decision points such as freight finding and price negotiation, improving matching efficiency for truckers, and unlocking latent capacity on the platform.

Speaker #3: Meanwhile, we continue to improve issue resolution efficiency and response speed within our AI-powered customer service system, driving structural improvements in both overall service quality and operating expenses.

Speaker #3: Looking ahead, we believe AI will continue to serve as the core technology foundation for improving operational efficiency and user experience across our platform. As we continue to refine our matching and fulfillment agents, we are also deepening the integration of our underlying models with the platform's high-frequency real-world transaction data, enabling AI to unlock greater value across matching efficiency, operating cost optimization, and user experience.

Simon Cai: Looking ahead, we believe AI will continue to serve as the core technology foundation for improving operational efficiency and user experience across our platform. As we continue to refine our matching and fulfillment agents, we are also deepening the integration of our underlying models with the platform's high-frequency real-world transaction data, enabling AI to unlock greater value across matching efficiency, operating cost optimization, and user experience. Thank you.

Speaker #3: Thank you.

Operator: Thank you. That concludes the question-and-answer session. I would like to turn the conference back over to management for any additional closing remarks.

Speaker #1: Thank you. That concludes the question-and-answer session. I would like to turn the conference back over to management for any additional closing remarks.

Speaker #2: Thank you once again for joining us today. If you have further questions, please feel free to contact Full Truck Alliance directly or reach out to CPG.

Mao Mao: Thank you once again for joining us today. If you have further questions, please feel free to contact Full Truck Alliance directly or reach out to TPG. Our contact information for IR in both China and the US can be found in today's press release. Have a good day. Thank you.