BingEx Q1 2025 Earnings Call Transcript

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May 22, 2025

There are 5 speakers on the call.

Operator

Day, and welcome to BingX twenty twenty five First Quarter Financial Results Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Helen Wu from PressMt Financial Communications. Please go ahead.

Speaker 1

Thank you, operator. During this call, we will discuss our business outlook and make forward looking statements. These comments are based on our predictions and expectations as of today. Actual events or results could differ materially from those mentioned in today's news release and in this discussion due to a number of risks and uncertainties, including those mentioned in our most recent filings with the SEC. The non GAAP financial measures we provide are for comparison purpose only.

Speaker 1

The definition of these measures and our consolidation table are available in the news release we issued earlier today. As a reminder, this conference is being recorded. In addition, a webcast replay of this conference call will be available on the Flush EX Company's IR website at ir.isansone.com. Furthermore, throughout the call, we will consistently use the company's brand name Flush EX to refer to its publicly listed entity, Bing EX Limited. Joining us today from Flush Yak's senior management are Mr.

Speaker 1

Adam Xue, Founder, Chairman of the Board and Chief Executive Officer Mr. Hong Jianyu, Co Founder, Director and Executive President and Mr. Luk Tang, Chief Financial Officer. We will now turn the call over to Mr. Adam Xue.

Speaker 2

Thank you, Helen. Hello, everyone, and welcome to FlashX first quarter twenty twenty five earnings call. In the first quarter, we continue to depend our strategic focus on core users and core value aiming to deliver higher quality, more efficient, on demand dedicated courier services. While refining service details, we also strive to enhance the overall user experience. Our personalized solutions, smoother interactions, and faster delivery speeds have made our service more convenient and enjoyable for users.

Speaker 2

These efforts have not only earned widespread praise from our customer, but also further strengthen Flash eX competitive edge in on demand dedicated courier delivery. In the fourth quarter of twenty twenty five, we recorded total revenue of RMB961 million. Gross margin improved both year over year and quarter over quarter to 13.2%. Adjusted net profit was RMB49.6 million. Amid growing competition in the delivery industry, Slush EX has remained committed to its unique on demand dedicated grid model focused on providing users with reliable service when it matters most.

Speaker 2

In the first quarter of twenty twenty five, FlashEX completed 58,000,000 orders, with the gross margin per order continuing to improve. Meanwhile, our service footprint continues to expand, particularly in lower tier cities, where all market penetration has deepened significantly. As of the end of Q1, FlashX has attracted nearly 2,860,000 registered riders and over 100,000,000 registered users, highlighting our brand momentum and industry leadership. In the first quarter of twenty twenty five, while strengthening our existing service categories and scenarios, we also further explored our user diverse needs. We passed the Flash eX user base in detail, conducting in-depth research into users across different age groups and profiles.

Speaker 2

This allowed us to better understand their preferences, accurately identify their needs, and expand into new user cases accordingly. In particularly, the new generation of younger users is showing a strong preference for high quality services and timely delivery. To better connect with them and gain deeper insight into their lifestyles and consumption habits, we actively engage with topics they care about and increase our presence on third party social platforms. Joining on this insight, we've developed task specific, personalized, on demand delivery service that precisely meet their unique day to day needs, further enhances user experiences and overall satisfaction. At the same time, we are actively expanding into new forms of cross industry collaboration.

Speaker 2

For example, we have seamlessly embedded the Flash eX brand into engaging content through strategic product placements in a range of popular TV shows. This approach has not only elevated brand awareness and visibility, but also enabled us to reach and resonate with our target audience more effectively, strengthening both brand recognition and emotional connection. To further enhance user loyalty and engagement, we remain focused on refining service details and elevating our product offerings aiming to boost Flash EX service capabilities across the board. Currently, our average delivery time has improved to just twenty six minutes, significantly faster than the industry average, underscoring our competitive edge in the instant delivery industry. It is also worth noting that even amid challenges such as severe weather, major holidays, or peak demand periods, Flash eX constantly maintains high fulfillment rates and customer satisfaction.

Speaker 2

Leveraging our responsive dispatch system, intelligent planning and comprehensive rider training, we ensure fast, reliable and delivers in any situation. Our ongoing efforts in this regard continue to strengthen FlashX reputation for premium service as well as our users trust and loyalty. In delivery management, we take precise and proactive approach by optimizing route planning efficiently, allocating riders and tracking orders in real time. We ensure assembly's efficient operation with constantly high order fulfillment rates. We recognize that delivery efficiency and service quality are what make FlashX stand out in a competitive market.

Speaker 2

That is why they continuously invest in technology and innovative management to enhance our performance. In the first quarter of twenty twenty five, our tech team accelerated the private deployment of DeepSeq. We draw progress in our digital transformation through algorithm upgrades and architectural optimization. At the same time, we focused on seamlessly integrating DeepSeg with our existing systems, striving from precise data alignment and fine tuned algorithm capabilities to ensure close coordination across platforms. These efforts have made interactions smoother and response time faster, significantly enhancing the user experience.

Speaker 2

On the record side, order assignment and dispatch efficiency have also improved notably, further optimizing our services. Our records are the heart and the soul of FlashX on demand delivery ecosystem. Every timely, accurate delivery and every thoughtful response to user needs reflects the FlashX spirit, and dependability. Their commitment not only builds Flash eX's brand reputation, but also spread warmth and good view throughout the community. Since 2019, Flash eX has remained committed to fulfilling its social responsibilities with our fire transparent and well structured system for recognizing riders who go above and beyond.

Speaker 2

We constantly foster positive social values. Each quarter we carefully select 10 to 20 outstanding riders from a platform of servants who have demonstrated self needs and a strong sense of duty during their deliveries. Some have stepped up to help in moments of crisis while others constantly devote themselves to charity, spreading warmth through simple yet powerful acts of kindness. Through both material rewards and public recognition, we honor these individuals while seeking to inspire others, encouraging a culture of compassion, responsibility, and integrity across industry. With this initiative, Flash eX is building a more harmonious society, bringing love and kindness to Southern up households, one delivery at a time.

Speaker 2

In the first quarter of twenty twenty five, we further strengthened support and care for Flash eX riders by enhancing our recognition and rewards program. Along with material incentives, we expanded benefits to include career development opportunities and prioritize access to training resources. Through these efforts, we aim to foster a lasting culture of everyday candidates within the FlashX rider community, encouraging more riders to embrace and share the spirit of goodwill in their daily work. At the same time, we emphasize our riders development and growth using the power of system and big data to improve training efficiency and accelerate onboarding for new riders. By analyzing their learning progress, skill mastery, and the real world challenges they face during deliveries, our data driven approach helps new writers quickly get up to speed our operational processes, significantly shortening their learning curve and having them perform with confidence sooner.

Speaker 2

Looking ahead, Flash eX will remain committed to our on demand dedicated career model, broadening its application across more scenarios, and enhancing our services to bring our users a better, more efficient, and more distinctive delivery experience. That concludes my remarks. Now I will hand over to our CFO, Luke Tang. Thank you.

Speaker 3

Thank you, Adam. Hello, everyone. This is Luke. I'd like to walk you through our first quarter financials. Despite the fierce market competition, we delivered a resilient operational performance in the first quarter, highlighted by improvements in our overall profit margin and the gross margin per order.

Speaker 3

Before we go through the financials, I would like to remind you that all numbers are in renminbi, and all percentage points, percentage changes are on a year over year basis, unless otherwise noted. Our revenues for the first quarter reached $960,800,000 compared to 1,107,700,000.0 in the same period of 2024. The year over year decline was primarily due to a decrease in fulfilled orders amid intensified market competition. Our cost of revenues for the quarter decreased by 14.7% to 834,100,000.0. The decrease was in line with a decline in revenues, primarily due to the reduction in fulfilled orders.

Speaker 3

Our gross profit was $126,700,000 for the first quarter compared with $130,300,000 in the same period last year. Gross profit margin grew by 1.4 percentage points to 13.2% for the first quarter. Turning to operating expenses. Our total operating expenses for the first quarter were 116,700,000.0 consisting of selling and marketing expenses of 49,300,000.0, general and administrative expenses of 37,900,000.0, dollars and the research and development expenses of $29,500,000 Excluding share based compensation expenses, our non GAAP income from operations was $26,600,000 for the first quarter. Other income was $9,900,000 for the first quarter compared with $19,000,000 for the first quarter of twenty twenty four.

Speaker 3

The year over year decrease was primarily due to a lower amount of government grants. Our non GAAP net income for the first quarter was 49,600,000.0 compared with $64,600,000 in the same period of 2024. Our cash position remained healthy. With cash and cash equivalents, restricted cash, and short term investments totaling $787,200,000 as of the first quarter end. As we move through 2025, we continue to unlock the full potential of our brand and differentiate the business model, expand our service scenarios, and further optimize operational efficiency to drive the company's long term sustainable growth.

Speaker 3

That concludes our prepared remarks. We would like now to open the floor to your questions. Operator, please go ahead.

Operator

Thank you. We will now begin the question and answer session. If you would like to ask question, please press 11 on your telephone and wait for a name to be announced. For the benefit of all participants on today's call, if you wish to ask your questions to management in Chinese, please see, please repeat your questions in English. One moment for the first question.

Operator

First question comes from the line of Jessie Xu of Deutsche Bank. Congrats

Speaker 4

on a very resilient quarter results in a challenging environment. And thanks for taking my question. My first question is regarding order volume and also competition. We noticed that the order volume year on year decreased this quarter has narrowed from last quarter. So just wondering how has the competition landscape changed over the past few months?

Speaker 4

And if we look ahead, are we expecting further improvements from here? And my second question is about margins and UE. It's very encouraging that both of your gross margin and gross profit per order have improved this quarter compared with same quarter last year. But on the other hand, operating margin slightly decreased. So I want to get more color on the reasons behind.

Speaker 4

Is it related to some measures we have taken to cope with the fierce industry competition? And how should we think about the margin profile as well as UE going forward? Thank you.

Speaker 3

Yep. Okay, Jessie. This is Luke. I will take your two questions. For the first question, FlexJax has always remained focused on the on demand dedicated courier model, continuously refine the service details and improving our operating efficiency.

Speaker 3

Building on this foundation, we are placing even greater emphasis this year on servicing our core customers and reinforcing our core value proposition. Well, market competition has always been a reality. We believe that the healthy and long term competition always plays a positive role in elevating service standards across the industry, ultimately delivering a better experience for our users. At the same time, FlashX remains open to learning from industry peers and joining on best practices to strengthen our capabilities and better address the evolving and diverse needs of our users. We firmly believe that with our high quality service and differentiated positioning, FLASHx will continue to maintain a strong competitive edge in this market.

Speaker 3

For the second question, as mentioned earlier, focusing on core customers and the core value is one of our top strategic priorities this year. By honing this focus, we aim to further optimize our business customer structure and unlock more service scenarios for our individual customers, which will allow us to meet and evolving our needs of different user segments with greater precessions. At the same time, we are leveraging big data models and the ones that AI powered operations to enhance our user experience and the overall operational efficiency, while continuously strengthening FLASHAC's differentiated positioning and core competitive advantages in today's market. We expect operational efficiency and the user experience to remain relatively stable in the short term. Looking ahead, we are confident that as FlashX brand value continues to grow and our user base expands, we will achieve sustainable long term growth.

Speaker 3

Yeah, thank you.

Speaker 4

Thank you.

Operator

Thank you for the questions. One moment for the next question. Our next question comes from the line of Sifan Jiang from CICC. Please go ahead.

Speaker 4

Thank you, the management team, for taking my questions. I've got two questions here today. The first one is regarding recent competition among on demand retail platform. Have you observed any signals of rising delivery demand driven by customer subsidies from platforms? If so, how has it influenced the order volume growth of our 2B and 2C business?

Speaker 4

The second question is, could the management team share how rider incentives have changed since the beginning of this year and provide an outlook on future trends? Thank you.

Speaker 2

Thank you, Stephane, your question. This is Adam speaking. For our first question, currently, market competition is largely concentrated in the food delivery sector. Since this inception, FlexiX has remained committed to its differentiated, on demand, dedicated delivery model, striving to provide users with a unique, high quality service experience. From a customer segmentation perspective, our B2B clients are primarily concentrated in high end dining sector.

Speaker 2

These customers place a premium on delivery speed, safety, and quality assurance. They expect every order to arrive in optimal condition and within the shortest possible time to boost their brand image and ensure customer satisfaction. On the b two c side, service scenarios tend to revolve around items that require high quality standards in terms of security, timeliness, and handling, such as important documents, cakes, and high value electronics, like laptops and smartphones. These items are either expensive or carry special significance with which makes users particularly sensitive to the quality and reliability of the delivery service. From a delivery method perspective, when users choose Flash e x, what they value most is a high end call is the high quality differentiated service experience we offer.

Speaker 2

Our one to one dedicated courier model ensures that each item receives careful personalized handling throughout the entire delivery process, providing maximum protection and security. At the same time, it allows for precise control over delivery time in ensuring both reliability and peace of mind. Overall, this is due some differentiation between the business segment, FlashEx serves and the sector currently facing the most intense market competition. To date, the impact on our operations has been relatively limited. That said, this wave of market competition has had some positive effects.

Speaker 2

It has significantly heightened both merchants and users' awareness of delivery efficiency and the reliability. Merchants are paying more attention to how delivery affects their business performance while users' expectations for delivery service quality are rising. And from a long term perspective, we believe that this market shift will have a positive and healthy influence on the entire logistic and delivery industry. It will encourage improvement in service standards across the board leading to a better overall user experience. And for your second question, at FlashEX, we've always placed the well-being and career development of rider at the heart of our development strategy.

Speaker 2

We fully recognize that riders are a vital link to our service chain and that their rights, sense of belonging, and professional pride are directly linked to our service quality and long term growth. That is why we take a comprehensive approach to supporting them, covering areas like welfare and protection, career advancement, operational support, and community engagement. Our goal is to create a warm, respectful environment where riders truly feel valued as part of the Flashy X family and foster a strong sense of belonging and pride in their profession. Since the beginning of this year, we further increased our investment in supporting and caring for flashy x writers. We've continued to refine and enhance our recognition and reward system providing tangible incentives to encourage education and quality service while also introducing a wider range of initiatives such as expanded careers, development opportunities, and access to training resources.

Speaker 2

Our goal is for riders to gain more than just financial rewards at FlashX. We want them to grow professionally, advance their careers, and realize their personal potential. It's worth noting that since 2022, the Ministry of Human Resource and Social Security along with other relevant development departments has launched a trial program in seven provinces and cities, including Beijing and Jiangsu, to provide occupational injury protection for workers in new forms of employment. Over the past two years, the program has expanded to cover four key factors sectors. Ride killing, food delivery, on demand delivery, and intra city freight.

Speaker 2

As an active participant in the pilot, Flash eX has strictly followed all requirements, adopting a per order payment model to ensure that every single delivery includes occupational injury coverage for all riders. This initiative not only provides our riders with greater peace of mind while they work, but also reflects Flash eX's strong sense of corporate social responsibility. Thank you.

Operator

Thank you for the questions. That concludes the question and answer session. I'll now like to turn the call over to Helen Wu for closing remarks.

Speaker 1

Thank you once again for joining Bing EX twenty twenty five first quarter financial results and the business update conference call today. If you have any further questions, please contact the IR team at Flush EX or PS and T Financial Communications. Thank you, and you have a nice day.

Speaker 2

Thank you.

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Key Takeaways

  • Financial resilience: In Q1 2025, FlashEx generated RMB 961 million in revenue with a 13.2% gross margin and delivered an adjusted net profit of RMB 49.6 million despite intensified market competition.
  • Order growth and efficiency: The company completed 58 million orders in the quarter, with continued improvement in gross margin per order and an industry-leading average delivery time of just 26 minutes.
  • Expanding footprint: FlashEx deepened its market penetration in lower-tier cities, growing to 2.86 million registered riders and over 100 million registered users, underscoring its brand momentum.
  • Tech-driven operations: Accelerated deployment of its DeepSeq platform and AI-powered algorithms has optimized order assignment, dispatch efficiency, and user interactions, boosting overall service quality.
  • Rider support and CSR: Enhanced recognition and rewards programs, career development opportunities, and occupational injury protection underscore FlashEx’s commitment to rider well-being and community impact.
AI Generated. May Contain Errors.
Earnings Conference Call
BingEx Q1 2025
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