Q4 2025 X Financial Earnings Call

Operator: I would now like to turn the conference over to Victoria Yu. Please go ahead.

Speaker #1: Independence will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing * then 0 on your telephone keypad. After today's presentation, there will be an opportunity for questions.

Speaker #1: To ask a question, you may press * then 1 on your telephone keypad. To withdraw your question, please press * then 2. Please note this event is being recorded.

Speaker #1: I would now like to turn the conference over to Victoria Yu. Please go ahead.

Speaker #2: Thank you, Operator. Hello, everyone, and thank you for joining today's call. Our financial results for the fourth quarter and the fiscal year ended December 13 31, 2025 were released earlier today, and are available on the company's investor relations website, either ir.xiaoyingroup.com.

Victoria Yu: Thank you, operator. Hello, everyone, thank you for joining today's call. Our financial results for the Q4 and the fiscal year ended 31 December 2025 were released earlier today and are available on the company's investor relations website at ir.xiaoyingroup.com. On the call today from X Financial are Mr. Kan Li, President, Mr. Frank Fuya Zheng, Chief Financial Officer, and Mr. Noah Kauffman, Chief Financial Strategy Officer. Mr. Li will begin with an overview of our business performance and key operational developments. Mr. Kauffman will discuss the regulatory environment and Q4 financial performance, followed by Mr. Zheng, who will review the full financial results, capital position, and outlook. After the prepared remarks, Mr. Li, Mr. Zheng, and Mr. Kauffman will be available to answer your questions during the Q&A session.

Speaker #2: On the call today from X Financial are Mr. Kat Lee, President; Mr. Frank Fuya Zheng, Chief Financial Officer; and Mr. Noah Kauffman, Chief Financial Strategy Officer.

Speaker #2: Mr. Lee will begin with an overview of our business performance and key operational developments. Mr. Kauffman will then discuss the regulatory environment and fourth-quarter financial performance.

Speaker #2: Followed by Mr. Zheng, who will review the full financial results, capital position, and outlook. After the prepared remarks, Mr. Lee, Mr. Zheng, and Mr. Kauffman will be available to answer your questions during the Q&A session.

Speaker #2: I remind you that this call may contain forward-looking statements, and there is a safe harbor provision of the private securities litigation reform act of 1995.

Victoria Yu: I remind you that this call may contain forward-looking statements under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements are based on management's current expectations and involve known or unknown risks, uncertainties, and other factors. These factors are difficult to predict, and many are beyond the company's control, which may cause actual results, performance, or achievements to differ materially from those described in these statements. Further information on these and other risks can be found in our SEC filings. The company undertakes no obligation to update any forward-looking statements as a result of new information, future events, or otherwise, except as required by law. It is now my pleasure to introduce Mr. Kan Li.

Speaker #2: Such statements are based on management's current expectations and involve known or unknown risks, uncertainties, and other factors. These factors are difficult to predict, and many are beyond the company's control.

Speaker #2: Which may cause actual results, performance, or achievements to differ materially from those described in these statements. Further information on these and other risks can be found in our SEC filings.

Speaker #2: The company undertakes no obligation to update any forward-looking statements. As a result of new information, future events, or otherwise, except as required by law.

Speaker #2: It is now my pleasure to introduce Mr. Kan Lee.

Speaker #3: Thank you, Victoria. And hello, everyone. In the fourth quarter of 2025, we continue to operate with heightened discipline as external environment became more demanding.

Kan Li: Thank you, Victoria, and hello, everyone. In Q4 2025, we continued to operate with heightened discipline as external environment became more demanding. Following a strong first class, we deliberately moderated activity in Q4 to remain aligned with evolving supervisory expectations and to prioritize credit quality and prudent risk management. During the quarter, we facilitated and originated RMB 22.77 billion in loans, representing a 29.5% decline year-over-year and a 32.3% decline sequentially from the previous quarter. This moderation was intentional, reflecting our focus on protecting portfolio health and maintaining long-term stability rather than pursuing near-term volume expansion.

Speaker #3: Following the strong first class, we deliberately moderated activity in Q4 to remain aligned with evolving supervisory expectations. And to prioritize credit quality and prudent risk management.

Speaker #3: During the quarter, we facilitated and originated RMB 22.77 billion in loans, representing a 29.5% decline year over year, and a 32.3% decline sequentially, from the previous quarter.

Speaker #3: This moderation was intentional, reflecting our focus on protecting portfolio health and maintaining long-term stability rather than pursuing near-term volume expansion. For the four-year for the four-year 2025, we facilitated and originated RMB 130.6 billion in loans, up 24.5% from RMB 104.9 billion in 2024.

Kan Li: For the full year 2025, we facilitated and originated RMB 130.6 billion in loans, up 24.5% from RMB 104.9 billion in 2024. This full year performance reflects the scale we achieved earlier in the year and our ability to operate with discipline as market and regulatory conditions evolved. During the quarter, we focused on strengthening the stability of our core operations through disciplining the channel management, tighter risk controls, and continued efficiency improvements. We increased the proportion of activity on internal operated platforms to enhance customer stability and reduce dependence on higher cost external traffic sources. We also further tightened underwriting standards to strengthen the compliance processes, optimize operational workflows, and expanded automation across services and collection functions to improve efficiency without increasing head count.

Speaker #3: This four-year performance reflects the scale we achieved earlier in the year, and our ability to operate with discipline and market and regulatory conditions involved.

Speaker #3: During the quarter, we focused on strengthening the stability of the channel management, tighter risk controls, and continued efficiency improvements. We increased the proportion of activity on internal operated platforms to enhance customer stability and reduce dependence on higher-cost external traffic sources.

Speaker #3: We also further tightened underwriting standards, strengthened compliance processes, optimized operational workflows, and expanded automation across quarter, we serve approximately 1.69 million active borrowers, down 20.2% from a year ago, standpoint, borrower activity and down 30.7% sequentially.

Kan Li: From an operational standpoint, borrower activity moderated meaningfully in Q4. We served approximately 1.69 million active borrowers, down 20.2% from a year ago and down 30.7% sequentially. We facilitated approximately 2.47 million loans in the quarter, with an average loan amount per transaction of RMB 9,226. We ended the quarter with RMB 50.5 billion in outstanding loan balance, down 3.6% from the same period of 2024. Credit quality. We did observe continued credit pressure during the quarter, consistent with broader market trends and a more cautious industry-wide risk posture.

Speaker #3: We facilitated approximately 2.47 million loans in the quarter, with an average loan amount per transaction of RMB 9,226. We ended the quarter with RMB 50.5 billion in outstanding loan balance, down 3.6% from the same period of 2024.

Speaker #3: Credit quality, we did observe continued credit pressure during the quarter consistent with broad with broader market trends and a more cautious industry-wide risk posture.

Speaker #3: As of December 31st, our 31 to 60-day delinquency rate increased to 2.9% compared with 1.85% at the end of Q3, and 1.17% a year ago.

Kan Li: As of 31 December, our 31 to 60-day delinquency rate increased to 2.9% compared with 1.85% at the end of Q3 and 1.17% a year ago. Our 91 to 180 days delinquency rate increased to 6.31% compared with 3.52% at the end of Q3 and 2.48% a year ago. These movements reflect rising repayment stress among certain segments, as well as a more conservative approach to risk. In response, we tightened underwriting criteria, enhanced the collection strategies, and adjusted capital deployment to preserve balance sheet resilience. As credit costs increased, we chose to prioritize stability and risk management, which affected short-term earnings but strengthens the foundation of the business. We believe this more cautious stance is appropriate given current conditions.

Speaker #3: Our 91 to 180 days delinquency rate increased to 6.31% compared with 3.52% at the end of Q3, and 2.48% a year ago. This movement reflected rising repayment stress among certain segments, as well as a more conservative approach to risk.

Speaker #3: In response, we tightened underwriting criteria, enhanced collection strategies, and adjusted capital deployment to preserve balance sheet resilience. As credit costs increased, we chose to prioritize stability and risk management, which affected short-term earnings but strengthened the foundation of the business.

Speaker #3: We believe this more cautious stance is appropriate, given current conditions. Our near-term priorities remain clear, safeguard portfolio quality, preserve liquidity, and maintain discipline in operations.

Kan Li: Our near-term priorities remain clear, safeguard portfolio quality, preserve liquidity, and maintain discipline in operations. With that, I'll now turn the call to Noah, who will walk through Q4 financial performance and the profitability trends, along with a brief regulatory update.

Speaker #3: With that, moderated meaningfully in the fourth will walk through P4 quarter fourth quarter financial performance, and the possibility trends along with a brief regulatory update.

Speaker #4: Thank you, Kent. Hello, everyone. It's great to speak with you again. Kent covered the operational and credit picture for the quarter. So I'll focus on the financial performance and our profitability profile in Q4.

Noah Kauffman: Thank you, Kent. Hello, everyone. It's great to speak with you again. Kent covered the operational and credit picture for the quarter, so I'll focus on the financial performance and our profitability profile in Q4. On the regulatory environment. The regulatory environment governing Internet-based lending in China continued to evolve meaningfully during 2025, with authorities increasingly refining and strengthening oversight across the entire consumer credit chain. The most significant development was Notice Nine, issued by the National Financial Regulatory Administration on 1 April 2025, which requires commercial banks to strictly control total borrowing costs. While Notice Nine does not explicitly stipulate a hard cap, in practice, a 24% annum ceiling on total borrowing costs for a single loan is generally being implemented and enforced across the industry. Importantly, 24% may not represent the outer boundary of that pricing pressure.

Speaker #4: On the regulatory environment, the regulatory environment governing internet-based lending in China continued to evolve, meaningfully, during 2025, with authorities increasingly refining and strengthening oversight across the entire consumer credit chain.

Speaker #4: The most significant development was noticed nine, issued by the National Financial Regulatory Administration on April 1st, 2025, which requires commercial banks to strictly control total borrowing costs.

Speaker #4: While notice nine does not explicitly stipulate a hard cap, in practice, a 24% annum ceiling on total borrowing costs for a single loan is generally being implemented and enforced across the industry.

Speaker #4: Importantly, 24% may not represent the outer boundary of that pricing pressure. Regulatory authorities have continued to tighten borrowing cost caps applicable to microcredit and consumer finance companies, and those entities may face de facto requirements set below that level.

Noah Kauffman: Regulatory authorities have continued to tighten borrowing cost caps applicable to microcredit and consumer finance companies, and those entities may face de facto requirements set below that level. The pace and manner of implementation across different institution types and jurisdictions remain highly uncertain, and we currently have no reliable basis on which to predict the ultimate scope or trajectory of these limitations. If current and emerging requirements are implemented as we currently understand them, our operating results will be adversely and materially affected relative to prior years. The magnitude of that impact is subject to significant uncertainty, and investors should not assume our historical profitability levels are indicative of future performance, including the possibility of operating losses in future periods. Notice Nine also requires commercial bank head offices to implement whitelist management systems for loan facilitation platform operators, prohibiting cooperation with institutions not on those lists.

Speaker #4: The pace and manner of implementation across different institution types and jurisdictions remain highly uncertain, and we currently have no reliable basis on which to predict the ultimate scope or trajectory of these limitations, if current and emerging requirements are implemented, as we currently understand them.

Speaker #4: Our operating results will be adversely and materially affected relative to prior years. The magnitude of that impact is subject to significant uncertainty and investors should not assume or historical profitability levels are indicative of future performance.

Speaker #4: Including the possibility of operating losses and future periods. Notice nine, also requires commercial bank head offices to implement whitelist management systems for loan facilitation platform operators, prohibiting cooperation with institutions not on those lists.

Speaker #4: This is introduced additional uncertainty around our funding relationships and implementation practices vary across banking groups and their subsidiaries. Future regulatory guidance could alter how those determinations are made in ways that affect our authorized funding relationships.

Noah Kauffman: This has introduced additional uncertainty around our funding relationships. Implementation practices vary across banking groups and their subsidiaries. Future regulatory guidance could alter how those determinations are made in ways that affect our authorized funding relationships. This is just one example of the broader unpredictability we are navigating. Separately, payment institution rating measures issued by the People's Bank of China in December 2025 extend regulatory oversight further across the lending chain, adding to compliance burdens and operational costs for industry participants. We are closely monitoring all of these developments as they continue to evolve in 2026. At this stage, management has limited visibility into the ultimate scope, pace, and direction of implementation. The potential impact on our business, financial condition, and results of operations cannot be determined with any degree of certainty. On Q4 financial performance.

Speaker #4: And this is just one example of the broader unpredictability we are navigating. Separately, payment institution rating measures issued by the People's Bank of China in December 2025 extend regulatory oversight further across the lending chain.

Speaker #4: Adding to compliance burdens and operational costs for industry participants. We are closely monitoring all of these developments as they continue to evolve in 2026.

Speaker #4: At this stage, management has limited visibility into the ultimate scope pace and direction of implementation. And the potential impact on our business financial condition and results of operations cannot be determined with any degree of certainty.

Speaker #4: On fourth quarter financial performance, in the fourth quarter of 2025, total net revenue was 1.47 billion RMB or 209.9 million US dollars, representing a 14.1% decrease year over year and 25.1% decrease sequentially from Q3.

Noah Kauffman: In Q4 2025, total net revenue was RMB 1.47 billion, or $209.9 million, representing a 14.1% decrease year over year and 25.1% decrease sequentially from Q3. Total operating costs and expenses were RMB 1.45 billion or $207 million, down 9.5% sequentially, but up 22.3% year over year. The year over year increase was driven primarily by materially higher credit-related provisions, while operating expenses also reflected our continued efforts to align spending with a more measured pace of activity. Credit-related provisions were the primary factor weighing on Q4 results.

Speaker #4: Total operating costs and expenses were 1.45 billion RMB or 207 million US dollars, down 9.5% sequentially, but up 22.3% year over year. The year over year increase was driven primarily by materially higher credit-related provisions, while operating expenses also reflected or continued efforts to align spending with a more measured pace of activity.

Speaker #4: Credit-related provisions were the primary factor weighing on the fourth quarter results. Total provisions were 669.3 million RMB or 95.7 million US dollars, reflecting higher expected credit losses and a more conservative provisioning across in response to elevated risk indicators during the period.

Noah Kauffman: Total provisions were CNY 669.3 million or $95.7 million US dollars, reflecting higher expected credit losses and a more conservative provisioning across in response to elevated risk indicators during the period. We also continued to take a disciplined approach to discretionary spending. For example, borrower acquisition and marketing expense was CNY 212.2 million or $30.3 million US dollars in Q4, reflecting a substantial reduction compared with both the prior quarter and the same period last year as we prioritized efficiency and risk discipline.

Speaker #4: We also continue to take a disciplined approach to discretionary spending. For example, borrower acquisition and marketing expense was 212.2 million RMB or 30.3 million US dollars in Q4, reflecting a substantial reduction compared with both the prior quarter and the same period last year, as we prioritized efficiency and risk discipline.

Speaker #4: As a result, income from operations was 20.2 million RMB or 2.9 million US dollars, a 96.2% decrease year over year, and a 94.4% decrease sequentially.

Noah Kauffman: As a result, income from operations was RMB 20.2 million or $2.9 million, a 96.2% decrease year-over-year and a 94.4% decrease sequentially. Operating margin decreased to 1.4% compared with 18.5% in Q3 and 30.7% in the same period last year. Below operating income, the quarter remained profitable, but at a level that underscores the degree of near-term credit pressure. Income before income taxes was RMB 31.2 million, or $4.5 million, reflecting the cumulative effect of lower revenue and elevated provisioning.

Speaker #4: Operating margin decreased at 1.4% compared with 18.5% in Q3 and 30.7% in the same period last year. Below operating income, the quarter remained profitable, but at a level that underscores the degree of near-term credit pressure.

Speaker #4: Income before income taxes was 31.2 million RMB or 4.5 million US dollars, reflecting the cumulative effect of lower revenue and elevated provisioning. Net income was 57.2 million RMB or 8.2 million US dollars in Q4, compared with 421.2 million RMB in Q3 and 385.6 million RMB in Q4 of last year.

Noah Kauffman: Net income was CNY 57.2 million or $8.2 million in Q4, compared with CNY 421.2 million in Q3 and CNY 385.6 million in Q4 of last year. Net profit margin was 3.9% compared with 21.5% in the prior quarter and 22.6% a year earlier. Return on equity decreased to 2.9%, reflecting substantially lower net income during the quarter. Taken together, Q4 reflects a materially different earnings profile compared with earlier periods, driven primarily by higher credit costs and a more measured level of activity. We are managing through this phase with a conservative financial posture and maintaining flexibilities as conditions evolve.

Speaker #4: Net profit margin was 3.9% compared with 21.5% in the prior quarter and 22.6% a year earlier. Return on equity decreased to 2.9%, reflecting substantially lower net income during the quarter.

Speaker #4: Taken together, Q4 reflects a materially different earnings profile compared with earlier periods, driven primarily by higher credit costs and a more measured level of activity.

Speaker #4: We are managing through this phase with a conservative financial posture and maintaining flexibilities as conditions evolve, with that I'll now hand the call over to Frank to discuss the full-year financial results per ADS metrics, non-gap profitability, and our balance sheet and liquidity position.

Noah Kauffman: With that, I'll now hand the call over to Frank to discuss the full year financial results per ADS metrics, non-GAAP profitability, and our balance sheet and liquidity position.

Speaker #1: Thank you, Noah. And hello, everyone. I will walk through our full-year financial results and then discuss our balance sheet liquidity and outlook. And full-year financial highlights.

Frank Fuya Zheng: Thank you, Noah, and hello, everyone. I will walk through our full year financial results and then discuss our balance sheet, liquidity, and outlook. Full year financial highlights. For the full year 2025, total net revenue was RMB 7.64 billion or $1.09 billion, representing a 30.1% increase from RMB 5.87 billion in 2024. Income from operations was RMB 1.63 billion or $233.1 million, compared with RMB 1.87 billion in 2024. Our full year operating margin was 21.3% compared with 31.9% in the prior year, reflecting a higher credit related provisions and a more cautious operation posture in H2.

Speaker #1: For the full-year 2025, total net revenue was RMB 7.64 billion or US dollar 1.09 billion. Representing a 30% 30.1% increase from RMB 5.87 billion in 2024.

Speaker #1: Income from operations was RMB 1.63 million or US dollar 233.1 million compared with RMB 1.87 billion in 2024. Our full-year operation margin was 21.3% compared with 31.9% in the prior year.

Speaker #1: Reflecting a higher credit-related provisions and a more cautious operation posture in the second half. Net income for the full year was RMB 1.46 billion or US dollar 209.4 million compared with RMB 1.54 billion in 2024.

Frank Fuya Zheng: Net income for the full year was RMB 1.46 billion or $209.4 million, compared with RMB 1.54 billion in 2024. Full year GAAP net profit margin was 19.2% compared with 26.2% in 2024. On a non-GAAP basis, adjusted net income was RMB 1.56 billion or $223 million for the fiscal year 2025, compared with RMB 1.54 billion in 2024. Per ADS and the non-GAAP metrics.

Speaker #1: Full-year gap net profit margin was 19.2% compared with 26.2% in 2024. On a non-gap basis, adjusted net income was RMB 1.56 billion or US dollar 223 million for the fiscal year 2025, compared with RMB 1.54 billion in 2024.

Speaker #1: Per ADS and the non-gap metrics, on a per ADS basis for the full year, net income per ADS was RMB 36 or US dollar 5.15 dollar and RMB 35.22 cents or US dollar 5.04 cents on a basic and diluted basis.

Frank Fuya Zheng: On a per ADS basis for the full year, net income per ADS was RMB 36, or $5.15 and RMB 35.22 or $5.04 on a basic and diluted basis, respectively, compared with RMB 31.98 basic, RMB 31.50 diluted in 2024. Non-GAAP adjusted net income per ADS was RMB 38.34, or $5.48 and RMB 37.50 or $5.36 on a basic and diluted basis, respectively, compared with RMB 31.98 basis and RMB 31.44 diluted in 2024.

Speaker #1: Respectively, compared with RMB 31.98 cents basic RMB 31.50 cents diluted in 2024. Non-gap adjusted net income per ADS was RMB 38.34 or US dollar 5.48 cents and RMB 37.50 cents or US dollar 5.36 cents on a basic and diluted basis, respectively.

Speaker #1: Compared with RMB 31.98 basis and RMB 31.44 diluted in 2024. For additional Q2 context, non-gap adjusted net income in the fourth quarter of was RMB 31.3 million US dollar 8.8 million non-gap adjusted earnings per ADS was RMB 1.56 or US 22 cents on both a basic and diluted basis.

Frank Fuya Zheng: For additional Q4 context, non-GAAP adjusted net income in the first quarter was RMB 31.3 million and $8.8 million. Non-GAAP adjusted earnings per ADS was RMB 1.56 or $0.22 on both a basic and diluted basis. Balance sheet and liquidity. Our balance sheet remains solid as of 31 December 2025. Total assets were RMB 14.667 billion or $2.1 billion. Total liability was RMB 6.83 billion or $976.5 million, total shareholder equities was RMB 7.84 billion or $1.12 billion.

Speaker #1: Balance sheet and liquidity. Our balance remained solid as of December 31st, 2025. Total assets were RMB 14.67 billion or US dollar 2.1 billion total liability was RMB 6.83 billion or US dollar 976.5 million or total equities total shareholder equities was RMB 7.84 billion or US dollar 1.12 billion.

Frank Fuya Zheng: The end of the year with RMB 987.6 billion or $141.2 billion in cash and cash equivalents, and RMB 1.15 billion and $133.9 billion in restricted cash. For total cash, including restricted cash of approximately RMB 2.13 billion or $305.1 billion. Capital return to shareholders. As of 15 March 2026, under the company's $100 million share repurchase program, the company had repurchased an aggregate of approximately 3.79 million ADSs, including approximately 3.37 million ADSs and 2.53 million Class A ordinary shares for a total consideration of approximately $53.85 million.

Speaker #1: We ended the year with RMB 987.6 billion or US dollar 141.2 billion in cash in a cash equivalent and RMB 1.115 billion and US dollar 133.9 billion in restricted cash.

Speaker #1: And for total cash, including restricted cash of approximately RMB 2.13 billion or US dollar 305.1 million. Capital return to shareholders. As of March 15th, 2026, under the company's US dollar 100 million share repurchase program, the company had repurchased an aggregate of approximately 3.79 million ADS, including approximately 3.37 million ADS and 2.53 million class A ordinary shares.

Speaker #1: For total consideration of approximately US dollar 53.85 million. The company now has approximately US dollar 46.15 million remaining under the share repurchase program, which is effective through November 30th, 2026.

Frank Fuya Zheng: The company now has approximately $46.15 million remaining under the share repurchase program, which is effective through 30 November 2026. This program underscores the company's confidence in its long-term growth outlook and its commitment to enhancing shareholder value. Repurchases under program remain subject to market conditions and other factors and may be modified or suspended at the management's discretion. Business outlook. Given evolving regulatory developments and the limited visibility into the how recent policy measures will be implemented across different jurisdictions, our near-term outlook remains cautious. The full impact of these changes on funding availability, pricing dynamics, and the overall industry activity is still uncertain and may take time to become clear. We are prioritizing asset quality, disciplined risk management, cost control, and the preservation of liquidity and operational flexibility.

Speaker #1: This program underscores the company's confidence in its long-term gross outlook and its commitment to enhancing shareholder value. The purchase repurchases under program remain a subject to a market conditions and other factors, and may be modified or suspended at the management's discretion.

Speaker #1: Business outlook given evolving regulatory developments and the limited visibility into the how reasonable policy measures will be implemented across different jurisdictions. Our near-term outlook remains cautious.

Speaker #1: The full impact of these changes on funding availability pricing dynamics and the overall industry activity is still uncertain and may take time to become clear.

Speaker #1: We are prioritized asset quality discipline risk management cost control and the preservation of liquidity and operational flexibility. As the regulatory expectation continues to develop, we are adapting our operation approach to maintain compliance while safeguarding the long-term stability of the business.

Frank Fuya Zheng: As the regulatory expectation continue to develop, we are adapting our operation approach to maintain compliance while safeguarding the long-term stability of the business. While we believe our platform is well-positioned to navigate a more stringent environment, additional policy adjustments or implementations actions could further affect industry economics and growth perspectives. We will continue to monitor developments closely and will update our outlook as greater clarity emerges. This concludes our prepared remarks. We will now open the call for questions. Operator, please go ahead.

Speaker #1: While we believe our platinum is well positioned to navigate a more straining environment, additional policy adjustments or implementations actions could further affect industry economics and the gross perspectives.

Speaker #1: We will continue to monitor developments closely and will update our outlook as greater clarity emerges. This concludes our prepared remarks. And we will now open the call for questions.

Speaker #1: Operator, please go ahead.

Speaker #2: We will now begin the question and answer session. To ask a question, you may press star then 1 on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the keys.

Operator: We will now begin the question-and-answer session. To ask a question, you may press star then one on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. At this time, we will pause momentarily to assemble our roster. This concludes our question-and-answer session. I would like to turn the conference back over to Victoria Yu for any closing remarks.

Speaker #2: If at any time your question has been addressed, and you would like to withdraw your question, please press star then 2. At this time, we will pause momentarily to assemble our roster.

Speaker #2: This concludes our question and answer session. I would like to turn the conference back over to Victoria Yu for any closing remarks.

Victoria Yu: Thank you, everyone, for joining us today. If you have additional questions, please reach out to our investor relations team directly. We appreciate your interest and look forward to speaking with you again soon. Operator, back to you.

Speaker #3: Thank you, everyone, for joining us today. If you have additional questions, please reach out to our investor relations team directly. We appreciate your interest and look forward to speaking with you again soon.

Speaker #3: Operator, back to you.

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