So-Young International Q4 2025 Earnings Report

So-Young International EPS Results

• Actual EPS: -$0.13
• Consensus EPS: -$0.68
• Beat/Miss: Beat by +$0.55
• One Year Ago EPS: N/A

So-Young International Revenue Results

• Actual Revenue: $65.85 million
• Expected Revenue: $442.62 million
• Beat/Miss: Missed by -$376.77 million
• YoY Revenue Growth: N/A

So-Young International Announcement Details

• Quarter: Q4 2025
• Date: 3/25/2026
• Time: Before Market Opens
• Conference Call Date: Wednesday, March 25, 2026
• Conference Call Time: 7:30AM ET

So-Young International (NASDAQ:SY) Inc. operates a leading digital marketplace and community platform focused on the medical aesthetic industry in China. Headquartered in Shanghai and founded in 2013, the company connects consumers seeking cosmetic treatments with a network of accredited clinics, licensed physicians and beauty service providers. Its online ecosystem offers a wealth of educational content, peer reviews and before-and-after galleries designed to help users make informed decisions about aesthetic procedures.

The company’s platform is accessible via web and mobile applications, where users can browse service packages, compare providers, read expert articles and schedule appointments directly through an integrated booking system. So-Young also hosts live-streaming events and video tutorials featuring medical professionals, covering topics such as dermatology, plastic surgery, minimally invasive treatments and skin care regimens. This content-driven approach supports consumer education while driving engagement across its community of registered users.

In addition to its marketplace operations, So-Young provides marketing, training and analytics services to its clinic and physician partners. By offering digital advertising solutions, customer relationship management tools and performance insights, the company helps practitioners expand their patient base and refine their service offerings. Periodic offline seminars, industry conferences and promotional activities further strengthen ties between So-Young, its medical partners and the broader aesthetic medicine ecosystem.

Leadership at So-Young International includes Founder and Chief Executive Officer Xia Fan, who brings a background in both technology and healthcare innovation. Under his guidance, the company has grown its network of certified providers to cover major metropolitan areas throughout mainland China. So-Young continues to invest in product development and community building as it seeks to maintain its position at the intersection of digital media, online commerce and medical aesthetics.

So-Young International Q4 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: So-Young reported a record Q4 with total revenue of RMB 460.7–461 million (+≈25% YoY), driven by aesthetic centers whose revenue rose to RMB 248.1 million (+205% YoY) and became the largest segment.
• Positive Sentiment: Rapid brick-and-mortar expansion — 49 clinics by year-end (now 50+), 25 centers profitable and 39 with positive operating cash flow — and a plan to open at least 35 new centers in 2026 while shifting toward balancing scale with profitability.
• Negative Sentiment: The company remains loss-making and is using cash to fund expansion — net loss attributable to So-Young was RMB 108.8 million (improved from RMB 607.6M), non-GAAP loss was RMB 93.4 million, and cash resources fell to RMB 936.4 million from RMB 1,253.2 million year-over-year.
• Positive Sentiment: Management emphasized quality and trust as a moat — the full-time physician team expanded to 211 doctors, implemented a six-pillar compliance framework and gained industry-first PIA certification, while core-member quarterly repurchase rate exceeds 80% with average annual spend ~RMB 16,500.
• Negative Sentiment: Revenue concentration and headwinds in other segments — information/reservation services, product sales and other services declined materially (−26.8%, −19.9%, −40.7% YoY respectively), increasing reliance on the branded clinic rollout to sustain growth and margins.

Presentation

[Operator]

Ladies and gentlemen, thank you for standing by for So-Young's fourth quarter and full year 2025 earnings conference call. At this time, all participants are in the listen-only mode. After management give their prepared remarks, there will be a question and answer session. As a reminder, today's conference call is being recorded. I will now like to turn the meeting over to your host for today's call, Ms. Mona Qiao. Please proceed, Mona.

[Mona Qiao, Investor Relations at So-Young International]

Thank you, operator, and thank you everyone for joining So-Young's fourth quarter and full year 2025 earnings conference call. Joining me today on the call is Mr. Xing Jin, our Founder, Chairman, and CEO, and Ms. Zhang Sha, V.P. of Finance. Before we begin, please refer to the safe harbor statement in our earnings release, which applies to this call as we will be making forward-looking statements. Please also note that we will discuss non-GAAP measures today, which are more thoroughly explained and reconciled to the most comparable measures reported under GAAP in our earnings release on our investor relations website and filing with the SEC. Please also note, all figures mentioned in this call are in renminbi, unless otherwise stated. At this time, I'd like to turn the call over to Mr. Xing Jin.

[Mona Qiao, Investor Relations at So-Young International]

Now let me walk you through our progress in Q4 and our 2026 deployment, focusing on our aesthetic center business. Our aesthetic center business has recently achieved two milestones. The first is our center footprint. By year-end 2025, we have opened 49 Light Medical Aesthetics centers, ranking first nationwide among all peers by center count. The second is the treatment volume. In Q4, verified treatment visits exceeded 125,000, up 178% year-over-year. Verified aesthetic treatment performed exceeded 289,400, up 168% year-over-year. As of December end, our total active users surpassed 170,000. The growth in both treatment volume and user base validates the market demand and ongoing recognition from consumers.

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Mona Qiao, Investor Relations at So-Young International]

As we scale, center-level operational efficiency continues to improve. In Q4, 25 centers achieved profitability and 39 centers generated positive operating cash flow. In 2026, we will accelerate the expansion, opening at least 35 new centers. We will deepen density in core cities including Beijing, Shanghai, Guangzhou and Shenzhen, while also expanding our presence in second-tier cities. As our operations mature, we are confident in further improving center profitability while maintaining expansion and driving the overall profitability at our early days.

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Mona Qiao, Investor Relations at So-Young International]

Second, we are enhancing our medical service delivery capability to build a long-term trust-driven moat. In Q4, we enhanced our service across three dimensions, physician team, compliance framework, and data security. These improvements reinforce the user trust.

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Mona Qiao, Investor Relations at So-Young International]

By year end 2025, our full-time physician team expanded to 211, up 41% from the end of Q3, ranking first nationwide among our peers by physician count. In terms of quality, all our physicians have a public hospital background and passed our rigorous internal certification before practicing. Over half of them hold attending physician qualifications or higher. On average, our team possesses over six years of clinical experience, and those with a year or more on So-Young have delivered over 6,200 treatments per physician, reflecting our solid clinical capabilities. In 2026, we will launch a new physician initiative to accelerate recruitment and build talent pipeline. The program will provide industry-leading hands-on practice, systematic training, and clear career path, enabling physicians to quickly achieve top-tier performance.

[Mona Qiao, Investor Relations at So-Young International]

As our physician team's expertise deepens and user word-of-mouth grows, we expect per-physician productivity to grow, driving continued improvement in profitability. On compliance, we established a six-pillar compliance framework and a regular inspection mechanism. With digital software, we deliver full-process traceability of medical services. On data security, So-Young is the first in the industry to obtain the PIA certification, setting a benchmark for the industry.

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Mona Qiao, Investor Relations at So-Young International]

Our ongoing investments are reflected in user behavior. Core members have a quarterly return rate of 80%, and their annual spending is around RMB 60,500. A growing user trust is the foundation of our low-cost, sustainable growth.

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Mona Qiao, Investor Relations at So-Young International]

Third, we will continue to build on our supply chain, enhance brand alliances and seize market opportunities. As of Q4, we worked with 18 top-tier domestic suppliers and had procured nearly 1,400 devices. For injectables, we have 42 top-tier upstream partners with a cumulative procurement of over 700,000 units. In 2025, the upstream supply expanded sharply. The NMPA issued over 50 certificates for class III medical devices, up over 60% year-over-year. For So-Young, this delivers a broader product portfolio, more favorable procurement costs and enhanced user experience. Backed by China's largest light medical aesthetics chain, we continuously enhance our supply chain layout capabilities. We have also built long-term partnerships with core suppliers and established a volume price linkage mechanism securing industry best-tier procurement prices.

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Mona Qiao, Investor Relations at So-Young International]

On our product layout. In Q4, we launched a lighter version medical PLLA version thread 30, which lowers the customer's barrier to trial. We are also the exclusive distributor of Xihong Biopharma's HA solution now approved for marketing in China, which expands our portfolio. For BBL treatments, we improved brand influence and conversion through IP collaboration and immersive experiences. In Q4, we partnered with The Little Prince IP and launched the Youth's Planet Timeless Radiance campaign. The campaign leveraged multiple channels and formats, including celebrity treatment experience, pop-up events, and in-store visits by bloggers on RedNote. Our pop-up event generated about 2 million on-site visits, and total exposure on RedNote exceeded 14 million. This online and offline synergy reinforced our brand awareness and led sales conversion for BBL, aligning brand building with revenue.

[Mona Qiao, Investor Relations at So-Young International]

Our product iteration, new product launches, and market activities reflect our commitment to the growth cluster strategy. In Q4, these growth cluster products delivered strong results, contributing over 37% of revenue with sequential growth, and remained a core engine for our aesthetic services.

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Mona Qiao, Investor Relations at So-Young International]

Meanwhile, our brand influence has been fully validated in offline scenarios. To date, we have successfully established a presence in high-end shopping malls nationwide, including Beijing Hopson One, Guangzhou ICC Mall, Hangzhou Kerry Centre, Parc 66 and so on. These premium shopping malls reinforce our brand recognition and help us reach target customer groups.

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Mona Qiao, Investor Relations at So-Young International]

Finally, let me share our outlook for the future. As the industry gradually shifts back to a rational, quality-driven path, value distribution is being reset. We believe that in the long run, the industry will be led by those closest to consumers and capable of delivering the most trusted services. For So-Young, 2026 is a turning point. We are moving from scale first to a dual engine of scale and efficiency. Our aim is not only to open centers, but also to prove the model is profitable as we expand. Our systematic capabilities over the past two years give us great confidence, but our ambition is to go beyond that. As our center network, supply chain, and medical service delivery create a flywheel, we will lower access barriers and let more consumers enjoy safe, transparent, and inclusive services while delivering sustainable returns to shareholders.

[Mona Qiao, Investor Relations at So-Young International]

We believe companies that create real value will earn long-term recognition from the market.

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Mona Qiao, Investor Relations at So-Young International]

Now I'll hand it over to our VP of Finance, Ms. Zhang Sha, to walk through the financial results, followed by the Q&A session.

[Sha Zhang, VP of Finance at So-Young International]

Thank you, Xin, and thank you everyone for joining us today. I'm Sha Zhang, Vice President of Finance. On behalf of our CFO, I will walk you through our fourth quarter 2025 operating and financial results. For additional details on our fourth quarter and full year performance, please refer to the earnings release we issued earlier today. Unless otherwise noted, all amounts are in RMB. 2025 marks a transformational year for So-Young. The rapid scaling of our branded aesthetic center network fundamentally reshaped our business profile, and we are pleased with where we are today. Total fourth quarter revenues reached RMB 460.7 million, up 24.8% year-over-year. This was driven by continued expansion of our branded aesthetic center business.

[Sha Zhang, VP of Finance at So-Young International]

As of year-end, our cash position stood at RMB 936.4 million, providing solid runway to fund our expansion plans while preserving financial flexibility. Let me now walk you through performance by business segment. Our branded aesthetic center business sits at the core of our growth, with our platform and upstream supply chain businesses serving as complementary pillars. Together, they form an integrated value chain across the medical aesthetic industry. Revenues from aesthetic treatment services reached RMB 248.1 million, up 205.3% year-over-year. This has been our largest revenue segment since Q2, and this quarter, it crossed the 50% revenue contribution threshold for the first time. Also, this marks our third consecutive quarter of exceeding the high end of our segment guidance. This strong performance was driven by both continued network expansion and improving per center economics.

[Sha Zhang, VP of Finance at So-Young International]

As of December 31st, we operated 49 So-Young clinics across 15 major cities, reflecting a net addition of 10 centers during the quarter. Now breaking down revenue by center development phase. Our 17 mature phase centers generated RMB 142.5 million in revenue, or roughly RMB 8.4 million per center. Our 19 growth phase centers contributed RMB 89 million, or roughly RMB 4.7 million per center. The 13 ramp-up phase centers contributed RMB 16.6 million. Notably, average revenue per center nearly doubles as centers progress from growth phase to maturity. With 19 centers currently in the growth phase, we see a clear built-in revenue growth driver as these centers continue to mature. As for their profitability, 25 centers achieved profitability during the quarter, including 16 mature phase centers. 39 centers generated positive operating cash flow. As centers move through their development cycle, profitability has consistently followed.

[Sha Zhang, VP of Finance at So-Young International]

This gives us confidence in the financial trajectory of our newer centers. Turning to other segments. Information and reservation services revenues were RMB 125.7 million, down 26.8% year-over-year, primarily due to a decrease in the number of medical service providers subscribing to information services on our platform. Sales of medical products and maintenance services revenues were RMB 69.3 million, down 19.9% year-over-year, primarily due to a decrease in the order volume for medical equipment. Other services revenues were RMB 17.7 million, down 40.7% year-over-year, primarily due to a decrease in revenues from So-Young Prime. I will now walk you through our financials below revenue in more detail.

[Sha Zhang, VP of Finance at So-Young International]

Cost of revenues was RMB 255.9 million, up 67.2% year over year, primarily driven by the expansion of our branded aesthetic centers. To break this down further, cost of aesthetic treatment services was RMB 189 million, up 189.9% year over year. Cost of information and reservation services was RMB 10.1 million, down 50.6% year over year. Cost of medical products sold and maintenance services was RMB 41.6 million, down 4% year over year. Cost of other services was RMB 15.3 million, down 36.7% year over year. Total operating expenses were RMB 327.7 million, compared with RMB 815.2 million in the same period of 2024.

[Sha Zhang, VP of Finance at So-Young International]

Excluding the impact of goodwill impairment charges in both periods, total operating expenses increased moderately year-over-year, reflecting continued investment in scaling our aesthetic center business. Sales and marketing expenses were RMB 168.7 million, up 25.8% year-over-year. This was primarily driven by branding and user acquisition investments supporting branded aesthetic center growth. G&A expenses were RMB 101.9 million, up 3.5% year-over-year due to the business expansion of the branded aesthetic centers. R&D expenses were RMB 37.4 million, down 12.4% year-over-year due to improved staff efficiency. We also recorded an impairment of goodwill and long-lived assets charge of RMB 19.7 million based on our annual long-lived assets impairment assessment.

[Sha Zhang, VP of Finance at So-Young International]

Income tax benefits amounted to RMB 0.6 million, compared with income tax expenses of RMB 2.1 million in the same period of 2024. Net loss attributable to So-Young was RMB 108.8 million, compared with RMB 607.6 million in the same period of 2024. Non-GAAP net loss attributable to So-Young was RMB 93.4 million, compared with RMB 53.2 million in the same period of 2024. Basic and diluted loss per ADS improved to 1.08 compared with 5.92 in the same period of 2024. As of December 31st, 2025, our cash and cash equivalents, restricted cash and term deposits, term deposits and short-term investments totaled RMB 936.4 million, compared with RMB 1,253.2 million as of December 31st, 2024.

[Sha Zhang, VP of Finance at So-Young International]

The decrease primarily reflects our accelerated investment in branded aesthetic center expansion. Looking ahead to the first quarter of 2026, we expect aesthetic treatment services revenues to be between RMB 268 million and RMB 278 million, representing year-over-year growth of 171.2% to 181.3%. This guidance reflects our confidence in the sustained momentum of our branded aesthetic center business. As of today, our center network has crossed the 50-center milestone. In 2026, we will shift our focus from pure network expansion towards balancing growth with profitability improvement. We plan to add no fewer than 35 new centers in 2026, while leveraging our expanding scale to improve growth margins and drive efficiency gains across the network. This concludes my remarks. Operator, we are now ready for the Q&A session.

[Operator]

Thank you very much. We will now begin the question and answer session. To ask a question, you may press star then one on your touchtone phone. If you're using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then two. At this time, we will pause momentarily to assemble our roster. If you would like to state your question in Chinese, do so, but then please also restate your question in English. Our first question comes from Hai Jinpang with CITIC Securities. Please go ahead.

[Hai Jingpang, Analyst at CITIC Securities]

Let me briefly translate for myself. Thank you for taking my question. I'm [Foreign language]. Firstly, congratulations on the excellent results in Q4, and we are glad to see that there is improving gross margins in the aesthetic center business and service business. I have a question regarding the gross margin prospects. Could you share more about the gross margin plans and source of further margin expansion? Thank you.

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Mona Qiao, Investor Relations at So-Young International]

Thank you for your question. They believe that three core factors shape margin performance. The pace of center openings, consumable costs, and seasonal promotions. Based on these factors, we have a plan to enhance those margins. First, we will continue optimizing the pace of center openings as they ramp up efficiency of new centers. Upfront investment into new centers can create short-term margin pressure. Licensing approval timing in our industry is often unpredictable. Going forward, we aim to adopt a more even cadence throughout the year. Combined with our integrated operating system, this accelerates each center's path to efficient operations and shorten the ramp-up cycle. For 2026, new openings will represent a smaller share of total centers compared to last year. This will reduce margin dilution of concentrated new center investments.

[Mona Qiao, Investor Relations at So-Young International]

Meanwhile, the proportion and profit contribution from mature centers will rise, driving the overall gross margin levels.

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Mona Qiao, Investor Relations at So-Young International]

Second, we will optimize consumable costs. Currently, we have built deep collaborations with upstream partners, including Xihong Biopharma, China Medical System Holdings, Sihuan Pharmaceutical, and Sota Medical. This guarantees reliable supply and ongoing cost optimization. Looking ahead, we will strengthen bargaining power with our partners and convert more high-quality upstream manufacturers into long-term partners. At the same time, we will continue advancing our multifaceted strategy. In the fourth quarter, our four major products accounted for over 37% of revenue, and our core offerings grew. The procurement cost advantages will become more pronounced. Third, we will refine our seasonal promotions. Seasonal campaigns remains a critical channel for user base expansion, customer conversion and building long-term user assets. Going forward, we will optimize our product mix and integrate campaigns more deeply with the membership system, targeting repeat purchases among core members.

[Mona Qiao, Investor Relations at So-Young International]

We aim to transform short-term traffic into customer LTV. This in return will drive growth margin.

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Hai Jingpang, Analyst at CITIC Securities]

[Non-English content]

[Hai Jingpang, Analyst at CITIC Securities]

[Non-English content]

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Operator]

Thank you. Your next question comes from John Wong with GF Securities. Please go ahead.

[John Wong, Analyst at GF Securities]

[Non-English content]

[John Wong, Analyst at GF Securities]

Thank you very much to the management of giving me this opportunity to ask a question. Congratulations to the company on this outstanding performance. My question is about the development of So-Young Clinic in second-tier cities. I would like to know whether the current operating performance of these centers has met management's expectations. Could management also share some operational updates on the several representative centers? Thank you.

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Operator]

Sorry to interrupt. Ladies and gentlemen, the line for the management has been disconnected. Please stay connected while we reconnect the line for the management. Thank you for patiently holding. Ladies and gentlemen, the line for the management has been reconnected. Yes, please go ahead。

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Mona Qiao, Investor Relations at So-Young International]

From an industry perspective, while China's medical aesthetic markets in second-tier cities have reached relative maturity. They lack the high first-tier cities in medical service delivery capabilities and operational standards. We ensure that our centers in second-tier cities deliver the same level of medical service quality as those in first-tier cities. Based on our operational track record, centers in second-tier cities are also growing well. Both the traffic and per customer treatments are rising, and the revenue per center is close to first-tier levels. As of December, mature centers in second-tier cities such as Wuhan Tiandi Center and Changsha IFS Center generated an average sales per sq m of RMB 7,000 per month. Among new openings in second-tier cities, Ningbo Raffles Centers and Suzhou Wuyue Plaza stood out. These centers have maintained robust revenue growth with industry-leading figures.

[Mona Qiao, Investor Relations at So-Young International]

For example, Suzhou Wuyue Plaza broke RMB 1 million monthly revenue within three months since opening, proving that our model works in second-tier cities. In terms of profitability, mature centers in second-tier cities enjoy slightly higher margins due to lower staff payroll and rental expenses compared to the first-tier cities.

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Mona Qiao, Investor Relations at So-Young International]

We believe that the fundamental advantage of a chain model lies in reduced transaction costs and enhanced brand trust through scale and accessibility. At present, most players in second-tier cities are single-center operators without many golden sites. Based on how they moved into cities and through user lifecycle trust growth, customers will tend to purchase multiple treatments per visit. Looking ahead, we believe the process improvement, resource synergy and traffic management will drive continued gains in our second-tier centers. Economies of scale will take effect across our network. We are confident that this will lead to stronger profitability and market competitiveness in second-tier cities.

[John Wong, Analyst at GF Securities]

[Non-English content]

[Mona Qiao, Investor Relations at So-Young International]

Thank you.

[John Wong, Analyst at GF Securities]

[Non-English content]

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Operator]

Maggie Huang, your line is unmuted. Please proceed with your question.

[Maggie Huang, Analyst at CICC]

[Non-English content]

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Maggie Huang, Analyst at CICC]

[Non-English content] This is Maggie Huang from CICC, congratulations for our excellent performance and we would like to know whether the competitive advantages in customer acquisition costs has been maintained amid its continued scaled expansion.

[Maggie Huang, Analyst at CICC]

Could management also share the customer acquisition strategy for 2026? Thank you.

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Mona Qiao, Investor Relations at So-Young International]

Our edge in customer acquisition cost has increased, preserved and further strengthened. During the quarter, we opened a significant number of new centers and seized the opportunities brought by major shopping campaigns, including Double 11 and Double 12, bringing a you know quarterly record for new customers. For the full year, our average CAC remains below 10% of revenue, a highly competitive benchmark in this industry. We sustain this advantage primarily through our customer referral model. Through our membership system and differentiated benefits, we will incentivize existing high-value users to refer new customers. This will not only lower CAC but also improve the quality and retention rate of new users.

[Mona Qiao, Investor Relations at So-Young International]

Second, we will continue to optimize the mix of our public and private domain customer acquisition channels and enhance their LTV through refined operations. Meanwhile, we will continue to roll out co-branding initiatives with the world's top IP. Recently, we launched co-branding programs with two renowned IP, The Little Prince and Disney. Through brand storytelling, we reached a broader customer base and resonated with users emotionally, further amplifying our brand equity. As our footprint expands and user base grows, we anticipate further reductions in tech. Thank you.

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Maggie Huang, Analyst at CICC]

[Non-English content]

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Operator]

Thank you. Your next question comes from the line of Daisy Chen with Haitong International. Please go ahead.

[Daisy Chen, Research Analyst at Haitong International]

[Non-English content] I'll translate myself. Thank you, management for taking my question. My question is about the user growth and membership operations, especially for core members. Could management share the specific measures you will take to improve the LTV of core members going forward? Thank you.

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Mona Qiao, Investor Relations at So-Young International]

For our core members, level three and higher members continue to show solid growth momentum. Our user services show that core members still have significant room for growth in their annual medical beauty budget, laying a foundation for us to boost user LTV. This quarter, revenue contribution from core members and their quarterly return rate both exceeded 80%, with new core members surpassing 14,000.

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Mona Qiao, Investor Relations at So-Young International]

Consumer performances are shifting towards efficiency and clinical capabilities. Against this background, we will focus on first expanding our product portfolio. We will introduce more comprehensive product offerings, including standardized science-backed treatments and leads to high-end services. We expect this to elevate user value. Second, we will further optimize our membership system by offering differentiated benefits and service touchpoints so as to realize tiered user segmentation and provide corresponding services. This will strengthen core members' perception of our brand value, building a positive feedback loop which will drive their loyalty. These measures will lead to improved percentage profitability and provide strong momentum for our long-term growth.

[Xing Jin, Co-Founder, Chairman, and CEO at So-Young International]

[Non-English content]

[Mona Qiao, Investor Relations at So-Young International]

Thank you.

[Operator]

Thank you. This concludes our question-and-answer session, and this concludes our conference for today. Thank you for attending today's presentation. You may now disconnect.

Participants

Executives

• Mona Qiao, Investor Relations
• Sha Zhang, VP of Finance
• Xing Jin, Co-Founder, Chairman, and CEO

Analysts

• Daisy Chen, Research Analyst at Haitong International
• Hai Jingpang, Analyst at CITIC Securities
• John Wong, Analyst at GF Securities
• Maggie Huang, Analyst at CICC