EHang Q1 2026 Earnings Call Transcript

Quartr
Provided by Quartr
June 9, 2026

Key Takeaways

  • Positive Sentiment: EHang said it remains on track for its 2026 revenue target of RMB 600 million, with management expecting most revenue to be recognized in the second half as domestic commercialization and overseas opportunities ramp up.
  • Neutral Sentiment: The company reported Q1 2026 revenue of RMB 25.7 million, roughly flat year over year but down sequentially, as weaker eVTOL deliveries were partly offset by growth in non-human-carrying businesses.
  • Positive Sentiment: EHang highlighted continued progress toward commercial pilotless passenger eVTOL service, saying it has obtained TC, PC, AC, and operator certificates, while final operational approvals and trial-to-ticketed service preparation are advancing with regulators.
  • Positive Sentiment: The company said its product mix is becoming more diversified, with aerial media accounting for about 40% of Q1 revenue and management guiding human-carrying products to about 60% of full-year revenue versus roughly 40% from non-human-carrying businesses.
  • Positive Sentiment: EHang ended March with a RMB 1.03 billion cash position and announced a share repurchase program of up to $30 million over the next 12 months, signaling confidence in the business and support for shareholder returns.
AI Generated. May Contain Errors.
Earnings Conference Call
EHang Q1 2026
00:00 / 00:00

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Operator

Good day, ladies and gentlemen. Thank you for standing by, and welcome to the EHang first quarter 2026 earnings conference call. Please note that the management's prepared remarks and the subsequent Q&A session will primarily be conducted in Chinese, and the corresponding simultaneous or consecutive interpretation can be accessed on the English line. As a reminder, all translations are for convenient purposes only. In case of any discrepancy, the management's statement in the original language will prevail. To listen to the original remarks by the management, please join the Chinese line. Additionally, both the Chinese and English lines are open for questions. Today's call is being recorded. Now I will turn the call over to Anne Ji, EHang Senior Director of Investor Relations. Ms. Anne, please proceed.

Anne Ji
Anne Ji
Senior Director of Investor Relations at EHang

Hello, everyone. Thank you all for joining us on today's conference call to discuss the company's financial results for the first quarter of 2026. The earnings release is available on the company's IR website. Please note that the conference call is being recorded. The audio replay will be posted on the company's IR website. On the call today, we have Mr. Huazhi Hu, our Founder, Chairman, and Chief Executive Officer. Mr. Shuai Feng, Chief Technology Officer. Mr. Zhao Wang, Chief Operating Officer. Mrs. Xiaona Li, China General Manager. Mr. Conor Yang, Chief Financial Officer. Before we continue, please note that today's discussion will contain forward-looking statements made pursuant to the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, the company's actual results may be materially different from the expectations expressed today.

Anne Ji
Anne Ji
Senior Director of Investor Relations at EHang

Further information regarding this and other risks and uncertainties is included in the company's public filings with SEC. The company does not assume any obligation to update any forward-looking statements, except as required under applicable law. Also, please note that all numbers presented are in RMB and are for the first quarter of 2026, unless stated otherwise. With that, let me now turn the call over to our CEO, Mr. Huazhi Hu. Please go ahead, Mr. Hu. Thank you.

Huazhi Hu
Huazhi Hu
Founder, Chairman, and CEO at EHang

Hello, everyone, and thank you for joining our earnings call. In the first quarter of 2026, EHang is navigating a critical transition from certification to commercial operation. We are fully committed to launching the world's first pilotless human-carrying eVTOL into commercial service. Today, I would like to share updates from two perspectives, the fundamental shift in regulatory environment and progress on our four core strategies. First, policy and industry developments. The biggest change in Q1 was institutional. The low-altitude economy now has a solid legal foundation and policy anchor. We're moving from a policy concept stage to one truly governed by law. On the legal front, the newly revised Civil Aviation Law was passed in January and will take effect on July 1st, formally recognizing the low-altitude economy for the first time.

Huazhi Hu
Huazhi Hu
Founder, Chairman, and CEO at EHang

On the regulatory front, the CAAC has established a new low-altitude safety bureau, while the NDRC and CAAC have formed a two-tier governance model, with the NDRC providing top-level coordination and the CAAC handling industry-specific implementation. Separately, China's State Administration for Market Regulation, together with 10 government departments in China, have jointly issued the Low-Altitude Economy Standards System Development Guide, aiming to establish a basic standard system by 2027. Some worry that more regulations may slow the industry down. I believe the opposite. This is a positive development. A clear regulatory and standard framework helps everyone in the industry move faster and more properly. As a pioneer, EHang is turning our certification and talent development knowhow into building blocks for industry standards. These first-mover advantages not only contribute to industry development, but also strengthen our long-term competitive mode. Meanwhile, state-owned enterprises and local governments are accelerating their deployment.

Huazhi Hu
Huazhi Hu
Founder, Chairman, and CEO at EHang

The low-altitude economy has been featured in the government work report for three consecutive years and is now designated as one of the six emerging strategic pillar industries under China's 15th Five-Year Plan. More cities are actively planning airspace, building vertiports, and rolling out subsidy programs. The low-altitude industry ecosystem is accelerating toward maturity. Now let me turn to progress on our four core strategies for this year. Routine commercial operations, global expansion, VT-35 certification, and industrial chain integration. First, routine and scaled commercial operations remain our top priority. We have cleared the certification hurdle and are now fully focused on the commercial operation hurdle.

Huazhi Hu
Huazhi Hu
Founder, Chairman, and CEO at EHang

We have obtained TC, PC, and AC, and our two operators hold OCs. Over the past year, we have continued to refine the entire operational chain, ticketing, insurance, aerospace approval, maintenance, charging infrastructure, crew training, and command and control systems to launch the world's first commercial pilotless human-carrying eVTOL service. We are now working closely with the regulator to fine-tune our operational capabilities and to make the final push from the internal trial operations to public ticketed service. That day will not be far away. The market demand is real. Take our RMB 299 experience ticket as an example. We continue to receive a large volume of inquiries asking, "When can I buy a ticket and take a flight?" This reflects a strong public enthusiasm for eVTOL commercial flights. Importantly, our operational capabilities extend beyond passenger eVTOLs. Our formation drone fleet has years of proven experience.

Huazhi Hu
Huazhi Hu
Founder, Chairman, and CEO at EHang

In February, our new GD 4.0 drones completed 22,580 units of formation flights, setting a Guinness World Record. In Q1, the proportion of revenue from the aerial media solution increased noticeably. The experience, processes, and teams we have built through these large-scale, highly reliable unmanned aircraft operations will directly benefit EH216-S commercialization. As the saying goes, the last leg of the journey marks the halfway point. Obtaining the four certificates was only the first half. The real second half is the commercial operation. In the global eVTOL industry, EHang remains the only company with the TC, PC, AC, and the license for commercial operations. The first-mover advantage here is not a short sprint nor a manufacturing race. It is an operational race. Who can run a safe, sustainable commercial model? Second, deepening our global footprint. We are making steady progress overseas.

Huazhi Hu
Huazhi Hu
Founder, Chairman, and CEO at EHang

The Thailand AAM sandbox program continues with the routine validation flights. To address hot weather conditions, we completed a battery cooling vehicle testing in Thailand and Guangzhou this month, adding independent cooling systems that significantly improve charging efficiency and passenger comfort. We are also actively working with the Civil Aviation Authority of Thailand to issue EH216-S' first overseas operating license. Our experience in Thailand sandbox has become an important reference for our global expansion. Third, accelerating VT-35 certification and commercialization. Certification for VT-35, our new longer-range pilotless human-carrying eVTOL, is progressing steadily. In Q1, we completed multiple system function and flight performance tests and held in-depth discussions with the CAAC on certification basis. Our VT-35 will support future intercity and regional air mobility, enriching our product portfolio.

Huazhi Hu
Huazhi Hu
Founder, Chairman, and CEO at EHang

At the same time, we are developing non-human carrying models, including firefighting and logistics for more application scenarios to further expand our addressable market. Fourth, strengthening industrial chain integration. We are turning our first-mover certification and ecosystem experience into industry consensus. EHang is not only China's leader in pilotless human-carrying eVTOL certification, but also the earliest practitioner and contributor to national and industry standards for unmanned aircraft in China. As the world's first mover about to enter routine commercial operation, we are taking steady steps to strengthen our operational capabilities and build a compliance mode. At the same time, we are integrating R&D, manufacturing, supply chain, and quality systems to improve end-to-end efficiency and scale delivered capabilities. In closing, I want to reiterate, the low-altitude economy is a long-term strategic arena with deep potential. EHang will never lose sight of safety, compliance, and operational quality.

Huazhi Hu
Huazhi Hu
Founder, Chairman, and CEO at EHang

We are committed to being long-term players who shape eVTOL industry standards with craftsmanship so that China developed and China operated pilotless eVTOLs will continue to lead the global low-altitude mobility market. I will now turn the call over to our CTO, Shuai Feng. Thank you.

Shuai Feng
Shuai Feng
CTO at EHang

Thank you, Mr. Hu. Hello, everyone. I am Shuai Feng. In Q1 2026, our work focused on three priorities, product R&D and upgrades, certification progress, and commercial operation support. On one hand, we accelerated VT-35 development and certification. On the other, we continued to optimize the EH216-S performance, operational efficiency, and passenger experience to support upcoming operations, strengthening the foundation for scaled deployment. Number one, VT-35 progress. VT-35 R&D and certification progressed steadily in Q1. The program has now entered the certification basis definition stage, where we are working closely with the CAAC to establish the safety evaluation framework.

Shuai Feng
Shuai Feng
CTO at EHang

We are engaged in in-depth discussions on special conditions, safety objectives, and performance requirements. On the engineering side, critical ground and flight tests are advancing as planned to validate system functionality, flight performance, and safety redundancy. Meanwhile, the VT-35 AVDOC system has entered a detailed design stage, preparing for certification prototype manufacturing and conformity verification. Building on the EH216-S certification experience and our eVTOL technical expertise, we are advancing VT-35 efficiently, laying the groundwork for future intercity and regional air mobility. Number two, EH216-S performance upgrades. This quarter, we focus on hot weather operational efficiency and passenger experience through targeted upgrades to battery thermal management and cabin comfort systems. On operational efficiency, to address battery thermal management challenges during high-frequency takeoffs and landings, we developed a dedicated battery cooling vehicle. It has completed production testing and is undergoing further optimization.

Shuai Feng
Shuai Feng
CTO at EHang

The cooling vehicle significantly shortens battery cool-down time from high temperatures to safe operating levels, increasing daily charging cycles and flight volume. In field tests, the cooling vehicle doubled EH216-S utilization, directly supporting higher-frequency commercial flights. The unit can be quickly deployed across operation sites, providing flexible and reliable thermal management for large-scale, high-density operations. On passenger experience, we upgraded the cabin air conditioning system. The new independent cooling system is separate from flight control and avionics circuits, so it doesn't interfere with critical functions while improving comfort. In tests, the system quickly reduces cabin temperature after prolonged sun exposure and maintains a comfortable level throughout the flight. This upgrade directly addresses a key pain point in hot climates, improving passenger experience, commercial reputation, and market acceptance. Number three, digital infrastructure for low-altitude operations.

Shuai Feng
Shuai Feng
CTO at EHang

Our Guangzhou command and control center is now fully operational, supporting passenger, firefighting, logistic, and formation drones. It provides integrated capabilities including aerospace management, flight planning, dispatch approval, real-time monitoring, operation records, and risk alerts. In Hefei, the command and control system has been deployed and is connected to the city’s low-altitude sensing network and Hefei HeYi Aviation’s operational data. Together, these platforms establish a solid foundation for regional, scaled low-altitude operations management. Number four, new product development. We are also actively advancing the R&D and flight testing of new products, including logistics and firefighting aircraft, further expanding our product portfolio and low-altitude economy applications. Under our CEO, Mr. Hu’s leadership, I will continue to lead our team in advancing product iterations with aviation-grade standards, translating technological progress into commercial value efficiently, and providing a strong foundation for EHang’s long-term growth.

Shuai Feng
Shuai Feng
CTO at EHang

I will now turn the call over to our COO, Zhao Wang, for sales and operations updates. Thank you.

Zhao Wang
Zhao Wang
COO at EHang

Thank you, Mr. Feng. Hello, everyone. I am Zhao Wang. As EHang enters a new phase of commercial operations, I want to introduce a new member of our management team. Ms. Li Xiaona, formerly our vice president and general manager of East China, has been promoted to China general manager. She will lead our sales, operations, and marketing teams, overseeing business development and operations management in both China and overseas markets. Over the years, Xiaona has led our East China team to build our presence in Hefei from the ground up. She established the Hefei HeYi Aviation, secured its operator certificate, built a highly effective operation system and team with strategic industrial layout covering R&D, manufacturing, and commercial operations, and delivered outstanding results.

Zhao Wang
Zhao Wang
COO at EHang

I look forward to seeing the Hefei model scale further under her leadership. Now, let me walk you through our Q1 business results and strategic plans. In Q1 2026, we achieved revenues of RMB 25.7 million. We delivered four units of the EH216-S and 1,000 units of the GD 4.0 formation drones and completed 22 drone formation performances. The year-over-year and sequential decline in eVTOL deliveries was mainly due to the seasonal impact of the Chinese New Year holiday and customer delivery timing. Looking at our revenue mix, our aerial media business grew faster and contributed approximately 40% of the total revenue in Q1. The parallel development of our multiple business lines is driving revenue diversification, reflecting continued demand growth across low-altitude application scenarios. Looking ahead to the full year, we remain confident in our 2026 revenue target of RMB 600 million.

Zhao Wang
Zhao Wang
COO at EHang

This will be supported by the progress we have made on three strategic initiatives. First, diversified revenue streams. Beyond passenger eVTOL sales and operations, our non-human-carrying businesses, including aerial media, firefighting solutions, and command and control systems, are expected to become new growth drivers. Second, continued overseas expansion. We expect to replicate our overseas model that combines regulatory sandbox program, local partners, and our integrated operational capabilities to drive sales and operations in Thailand and other global markets. Third, advancing domestic commercial operations. Preparation for EH216-S commercial operations has entered the final stage. We are working with the CAAC on the last mile of commercial operation. We will continue to prioritize both sales and operations, ensuring steady and compliant commercialization progress. I will now turn the call over to Xiaona for a detailed review of our Q1 execution. Thank you.

Li Xiaona
Li Xiaona
China General Manager at EHang

Thank you, Mr. Wang. Hello, everyone. I am Li Xiaona.

Li Xiaona
Li Xiaona
China General Manager at EHang

I am pleased to join the earnings call for the first time. Let me walk you through our Q1 results, operational strategy, and future plans. In February, we featured 16 EH216-S aircraft and 22,580 GD 4.0 formation drones in the CMG 2026 Spring Festival Gala Hefei segment. We completed a flawless performance and set a new Guinness World Record. This appearance significantly enhanced our brand awareness and industry visibility, helped reduce the concept of low altitude mobility to a broad public audience, and demonstrated our leadership in fleet flights, remote dispatch, and communication integration, strengthening our brand foundation for commercial partnerships and market expansion, both at home and abroad. As of May 2026, the EH216 series has accumulated over 90,000 safe flights globally in 21 countries. This long-term, stable, safe track record is our core competitive advantage in global market expansion.

Li Xiaona
Li Xiaona
China General Manager at EHang

Overseas, we have achieved multiple milestones, completed the first human-carrying flight in Mexico, Latin America, and trial flight permits in Thailand, Japan, South Korea, and Middle East and Spain. On overseas strategy, we made a strategic adjustment this year, making VTC our top priority to fully open the commercial pathway in overseas markets. Given how civil aviation regulations work, we plan to leverage China's existing bilateral airworthiness agreements with 32 countries for our certification applications. Thailand is our first flagship overseas market. Five vertiport locations have been identified, and the first approved survey has been completed. We have adapted our hardware, including batteries and onboard air conditioning, for hot and humid tropical environment, and are pushing hard on commercial operation permit progress. We have formed a dedicated overseas team integrating R&D, commercial airworthiness, and communications functions.

Li Xiaona
Li Xiaona
China General Manager at EHang

Going forward, we will systematically map out our bilateral civil aviation policies globally and develop differentiated overseas deployment plans for human carrying and cargo aircraft, targeting key markets one by one. On domestic human-carrying air mobility network continues to expand. To date, our customers have built over 40 eVTOL operational sites across China, some of which are already in routine operation. This year, we are shifting our business focus to high-demand tourism scenarios using light asset models such as equipment leasing, joint operations, and direct sales to lower the barrier for partners while putting existing aircraft to fly. We are prioritizing locations with high foot traffic and natural commercial appeal, such as Dali, Huangshan, and Taishan, running small-scale trials to accumulate safety data, then progressively helping customers apply for operator certification.

Li Xiaona
Li Xiaona
China General Manager at EHang

To improve project execution efficiency, we have set up a dedicated sales support team that works alongside frontline teams to develop customized integrated operation plans based on local airspace conditions, tourism resources, and commercial landscape. On commercial operation preparation, the CAAC has raised the requirements for the world's first pilotless human-carrying eVTOL commercial operation with higher and more detailed standards. At this stage, our two OC-certified operators in Hefei and Guangzhou continue to refine their operations systems, ground support, crew training, and emergency procedures while running internal trial operations routinely and accumulating flight data and service experience. Since obtaining their OCs in March 2025, both operators have maintained a perfect safe record, zero accidents, and zero violations. As domestic benchmarks, EHang General Aviation and Hefei Heyi Aviation have completed over 3,000 EH216-S flights.

Li Xiaona
Li Xiaona
China General Manager at EHang

We have built a complete end-to-end service system covering ticket pricing, online and offline ticketing channels, customer service, and complaint handling. Flight capacity is being expanded in phases. Going forward, we'll continue to refine our standardized SOPs for passenger services, ticketing management, and vertiport operations, then export these proven models. Crew training progress is on track. We have completed internal instructor training for the EH216-S model and submitted all required materials. The plan has been reviewed by the CAAC Central South Regional Administration, and once formally approved by the CAAC, official training will begin. After internal instructor training wraps up in late June, we'll begin full-scale crew training. Our non-human carrying business is an important second growth driver. We focus on two areas, firefighting and inland waterway logistics. On the firefighting side, based on real-world operational scenarios, we have identified clear product iteration directions.

Li Xiaona
Li Xiaona
China General Manager at EHang

R&D of the new firefighting aircraft is on schedule, will be formally launched to the market upon product validation together with supporting maintenance and training systems. In the second half of the year, we'll showcase product performance through firefighting drills at various levels while actively working to get our products included in fire equipment procurement catalogs, tapping into the emergency response market. On inland waterway logistics side, we have completed site selection for test routes at Guangzhou Port and the Pearl River main channel. The project will be rolled out in phases. Near term, continue test flights and routine safety reviews. Medium term, routine delivery services on the Pearl River and expansion of our new application scenarios.

Li Xiaona
Li Xiaona
China General Manager at EHang

Long term, replication of the proven model, application for government funding, and building a benchmark inland waterway low altitude logistics project in China. With formation drone performances, the industry is seeing increasingly intense low-price competition. We are avoiding price competition, have set a clear strategy to build benchmark projects, replicate profitable models, and expand both domestically and overseas. In overseas markets, we are simultaneously rolling out formation products, leveraging local tourism resources to create routine performance venues that complement our human-carrying business. Going forward, I'll lead the sales, marketing, and operation team to execute our strategic plan steadily with dedication, efficiency, and compliance, with safety as the first priority. I will now turn the call over to our CFO, Conor Yang. Thank you.

Conor Yang
Conor Yang
CFO at EHang

Hello, everyone. Before I go into the details, please note that all numbers presented are in RMB unless otherwise stated.

Conor Yang
Conor Yang
CFO at EHang

A detailed analysis is available in our earnings press release on the IR site. Now let me walk you through the key financial data. In Q1 2026, revenues were RMB 25.7 million, on par with RMB 26.1 million in Q1 2025, but down from RMB 177.6 million in Q4 2025. The decline was mainly due to lower eVTOL deliveries, partly offset by growth from our non-human carrying business. During the quarter, we delivered four units of the EH216 series, compared to 11 units in Q1 2025 and 61 units of EH216 series plus five units of VT-35 in Q4 2025. The lower deliveries were primarily due to seasonal factors at the beginning of the year and customer delivery schedules. On a positive note, our revenue mix continues to diversify.

Conor Yang
Conor Yang
CFO at EHang

Benefiting from increased brand visibility and growing market demand, our aerial media business grew faster and contributed approximately 40% of total revenue in Q1, highlighting the synergies across our diversified business lines. Gross margin in Q1 was 62.5%, stable compared to 62.4% in Q1 2025, and up slightly from 61.6% in Q4 2025. Our consistently strong margin profile reflects continued improvements in manufacturing efficiency and supply chain management. Turning to operating expenses. Adjusted operating expenses defined as total operating expenses excluding share-based compensation were RMB 101.1 million in Q1, up 59% from RMB 63.6 million in Q1 2025, and up 7.9% from RMB 93.7 million in Q4 2025. The increase was driven by our continued commercialization efforts, R&D team expansion, and increased technology investment.

Conor Yang
Conor Yang
CFO at EHang

As our business scales, we have strengthened our operational R&D and global expansion teams while continuing to invest in EH216 series upgrades, VT-35 development, and future generation products and core technologies to enrich our product pipeline and reinforce our long-term competitive advantages. As we continue to invest for future growth, our near-term profitability was impacted by lower revenue scale and higher R&D expenditure. Adjusted operating loss in Q1 was RMB 77.1 million, compared to RMB 42.6 million in Q1 2025. Adjusted net loss was RMB 75.6 million, compared to RMB 31.1 million in Q1 2025. As of March 31st, 2026, our combined cash and cash equivalents, restricted short-term deposits, and short-term and treasury investment totaled RMB 1.03 billion. This healthy cash position provides a solid support for the continued execution of our commercialization strategy, global expansion plans, and technology development programs.

Conor Yang
Conor Yang
CFO at EHang

While near-term financial performance was impacted by delivery timing and strategic investments, we remain committed to long-term growth strategy and maintain our 2026 annual revenue guidance of RMB 600 million. Our confidence is supported by our diversified revenue mix, continued global market progress, including the commercial breakthrough in Thailand, and the advancement of EH216-S commercial operations in China. Meanwhile, we remain focused on improving operational efficiency and capital allocation as we scale our business. We believe these efforts will strengthen our foundation for long-term growth and create sustainable value for our shareholders. Based on our confidence in the company's future and healthy cash position, our board of directors has approved a share repurchase program. Over the next 12 months, the company may repurchase up to $30 million worth of its ADSs. Repurchases will be funded from existing cash reserves, and management will execute them flexibly based on market conditions.

Conor Yang
Conor Yang
CFO at EHang

This initiative reflects our commitment to returning value to shareholders and demonstrating our long-term confidence. Thank you all.

Operator

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. If you're on a speakerphone, please pick up the handset to ask your question. We will now pause momentarily to allow questions to register. Once again, if you wish to ask a question, please press star one on your telephone. Thank you. Your first question comes from Peggy Wang with MS. Please go ahead.

Peggy Wang
Peggy Wang
Analyst at Morgan Stanley

Hello, this is Peggy from Morgan Stanley. Can you hear me?

Conor Yang
Conor Yang
CFO at EHang

Yes.

Peggy Wang
Peggy Wang
Analyst at Morgan Stanley

Hi, thank you for taking my questions. I have two questions for the first quarter results. I think first, most investors are curious about what is the expected revenue mix for main three quarters of 2026. Because we have been exploring more revenue stream from product outside of eVTOL. Could the management team give more color on the revenue mix in the following quarters? This is my first question. The second question is about the overseas business. How should we look at the contribution from the overseas market in the coming months? Thank you.

Conor Yang
Conor Yang
CFO at EHang

Thank you。[Non-English content]

Conor Yang
Conor Yang
CFO at EHang

[Non-English content]

Zhao Wang
Zhao Wang
COO at EHang

Hello, operator, can you hear me?

Operator

Yes。

Zhao Wang
Zhao Wang
COO at EHang

Now I'll provide the translation for Conor. The key strategy for the company is to execute revenue diversification strategy. The results have been shown in our Q1 results. We have projects both at home and overseas for our human carrying business as well as our GD4 AAL business. The projects are scattered across both China and overseas. Some of the typical examples are projects in Changsha, Xiamen. An overseas example would be Thailand. We are going to increase the number of performances for these GD4 drone performances in the upcoming two quarters. We are also advancing the R&D for our logistics and firefighting models. They will be rolled out to the market later this year. In terms of the revenue mix breakdown for our human carrying business, specifically speaking, that will be revenue contributed by the sales and deliveries of EH216s and the VT-35. Together, they will contribute 60% of our revenue. For non-human carrying businesses. They are going to contribute roughly 40% of our revenue. Now moving on to the second question. The proportion of the overseas revenue will increase significantly. We have made obtaining overseas VTCs, i.e.

Zhao Wang
Zhao Wang
COO at EHang

validation of type certificates, our top priority this year, relying on bilateral agreement channels and have established a dedicated team. Pioneer projects in Thailand and Mexico are progressing smoothly. In the medium to long term, overseas markets are expected to continuously contribute to revenue. Thank you.

Operator

The next question comes from Wei Shen with UBS. Please go ahead.

Wei Shen
Wei Shen
Analyst at UBS

[Non-English content]

Wei Shen
Wei Shen
Analyst at UBS

Thank you, management, for taking our question. My first question is on the gross profit margin. As we can see, it stayed elevated in Q1. I also noticed that 40% of revenue from Q1 was contributed by media business or non-human carrying related services. I was wondering what is the gross profit margin for this segment? What is the market and competition outlook is like for this segment? My second question is on your overseas business. As we have heard from management, the potential orders from overseas markets was around 100 units. I was wondering if there is any update to this number? If you can please also provide a timeline on that. Thank you.

Conor Yang
Conor Yang
CFO at EHang

[Non-English content]

Zhao Wang
Zhao Wang
COO at EHang

Sure. On the gross profit margin, so that specifically means the gross profit margin of sales and performance of the flight performance of the GD 4.0. That is around 50%. For our human carrying business, that is contributing higher and higher profit margin this year. Therefore, we are seeing the overall mix staying above 60% for the first quarter. We also keep that as our full year target. That is on the gross profit margin.

Conor Yang
Conor Yang
CFO at EHang

[Non-English content]

Zhao Wang
Zhao Wang
COO at EHang

With your question on the overseas orders, we are expecting the revenue contribution to rise up to 10% of the overall revenue. However, this specific contribution is closely tied to our commercial developments in Thailand. We have been spending every effort in our communication with the CAAC. Our overall target is to launch the official commercial operation by the end of the year before the AAM conference is going to be held in Bangkok by the end of the year. If the commercial operation could be achieved early, we are going to see a higher contribution to the revenue from the overseas market. Thank you.

Operator

Your next question comes from Alan Lau with Jefferies. Please go ahead.

Alan Lau
Alan Lau
Analyst at Jefferies

Thanks for taking my question. This is Alan. I'd like to follow up on the question regarding the gross margins. What are the major cost items for the non-eVTOL business? Because the margin is 50%, we would like to know what are the key cost of goods sold in that business line. The second question is there any operation data that management can share to investors regarding the operations in Hefei? Thank you. Sorry, I would like to clarify. My first question is regarding to the non-eVTOL part. The aerial media part. What are the cost of goods sold in that business? Thank you.

Zhao Wang
Zhao Wang
COO at EHang

Okay. Now the sales and the performance of the drone flights is contributing 50% profit margin. To break it down, majority of the costs for the sales comes of the drones is first of all, the BOM costs, plus the battery, the costs occurred in the assembly line. When it comes to performing, the majority cost of that depends on the size as well as the units of the drones to be deployed for the performance. Given that these drones are possessed by the company as a fixed asset, there is a cost of depreciation, plus the cost of sending personnel and staff to operate and fly these drones at different places. Together, these form the costs of the operation and the sales. Now moving on to the non-human carrying business, specifically we're talking about the firefighting models. It has a higher gross margin.

Zhao Wang
Zhao Wang
COO at EHang

In terms of the cost, a third of it comes from the carbon fiber material used in building the model. Another one third of the cost comes from the powertrain as well as the battery, with the remaining one third coming from the components I used to build the model.

Li Xiaona
Li Xiaona
China General Manager at EHang

[Non-English content]

Zhao Wang
Zhao Wang
COO at EHang

This is Wang Zhao. I'll take your second question. I know the market is keenly watching the progress of the operation site in Hefei. I would say it is right now in the final stage of official commercial operations. At the moment, the Hefei and Guangzhou operation sites are currently still in preparation for commercial operations. Given the unique nature of that site being the world's first pilotless human-carrying VTOL commercial operation project, the CAAC has proposed higher and stricter operational standards. Since obtaining the OC in March 2025, we have been maintaining close communications with the CAAC. We are accumulating precious and valuable trial flight data, making sure that there is no accidents or zero violations of the standards in place. Thank you.

Li Xiaona
Li Xiaona
China General Manager at EHang

[Non-English content]

Zhao Wang
Zhao Wang
COO at EHang

To supply some key data, since obtaining the OC in March 2025, the two partner or two operation sites have maintained stable operations with a safe flight record of zero accidents and zero violations, completing over 3,000 flights. As we have disclosed, the early bird price we set for the Hefei operation site is RMB 299. Currently, there are four units of the EH216 at this site, and they are scheduled to fly 14 flights per day. Related mini apps for ticket booking is now up and running. We are fully ready for commercial operations. Once we get the approval from the CAAC, we will soon roll out the commercial operation. Thank you.

Operator

Your next question comes from Laura Li with Deutsche Bank. Please go ahead.

Laura Li
Laura Li
Analyst at Deutsche Bank

Hey, thank you for taking my question. My first question would be, could you provide more color on the order intake so far in 2026? Are the new orders mainly from existing customers or that you're seeing demand from new clients as well? My second question will be, could you update the expected timeline for the operator training? Because once your program is approved, like how long it takes for the first group of the ground crew to complete the training. Thank you.

Conor Yang
Conor Yang
CFO at EHang

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Conor Yang
Conor Yang
CFO at EHang

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Zhao Wang
Zhao Wang
COO at EHang

On the revenue question, we remain confident in our full year revenue target of RMB 600 million. Actually, this confidence is based on the diversified revenue structure achieved in Q1, the predictability of overseas market breakthroughs and domestic commercial operations entering the final sprint phase. Majority of the orders will be coming in the second half of the year. We have many orders moving in parallel. Given that a majority of the orders coming from government related entities or institutions or enterprises, the overall approval for the budget is primarily ready in the second half of the year. We also have seen a lot of new customers expressing strong interest in purchasing our models. We expect that over 50% of the revenue for this upcoming year gonna come from new customers.

Li Xiaona
Li Xiaona
China General Manager at EHang

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Zhao Wang
Zhao Wang
COO at EHang

[Non-English content] Sorry。

Li Xiaona
Li Xiaona
China General Manager at EHang

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Zhao Wang
Zhao Wang
COO at EHang

Let me explain. The crew training usually is broken down into three stages. In the very first stage, the CAAC has officially stipulated the large-scale civil pilot training or crew training mechanism. We have deeply involved in this process. We actually supplement all the related documents, teaching materials, and everything. We also participate in making the related teaching materials and formulating the tests required to test all the training personnel. Actually, in May this year, the CAAC has already formally published the requirements for the civil training related standards. That actually provided a key compliant reference for the whole industry. EHang has been deeply involved in that process. We have actually lent our experience to this process in forming the standards.

Li Xiaona
Li Xiaona
China General Manager at EHang

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Zhao Wang
Zhao Wang
COO at EHang

Following the formulating the standards is the internal training of the instructors. This process has kicked off and is about to wrap up. We have submitted the associated plans, which has been reviewed by the CAAC. Right now, this has been progressing quite steadily. We are expecting the training of the instructor program to wrap up by the end of the month. The third stage is to kick off the official training of the ground crew. That will expect it to start in the following quarters. Once all these stages have completed, EHang will be in a good position and ready to launch batch trainings. With each training group, we can train 5-10 personnel, and with multiple classes training groups moving in parallel. By that time, we will be ready to supply sufficient number of qualified ground crew to the market. Thank you.

Operator

Thank you all. Given the time is limited, let me turn the call back to Ms. Anne for closing remarks.

Anne Ji
Anne Ji
Senior Director of Investor Relations at EHang

Thank you operator. Thank you all for participating on today's call. We understood that there are many analysts and investors still waiting on the line. Due to the time limits, if you have any further questions, please contact our IR team by email or participating in our following investor events through the calendar information provided on our IR website. We appreciate your interest and look forward to our next earnings call. Thank you.

Operator

That does conclude our conference for today. Thank you for participating. You may now disconnect.

Executives
    • Anne Ji
      Anne Ji
      Senior Director of Investor Relations
    • Conor Yang
      Conor Yang
      CFO
    • Huazhi Hu
      Huazhi Hu
      Founder, Chairman, and CEO
    • Li Xiaona
      Li Xiaona
      China General Manager
    • Shuai Feng
      Shuai Feng
      CTO
    • Zhao Wang
      Zhao Wang
      COO
Analysts
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