ATRenew Q1 Earnings Call Highlights

Key Points

• ATRenew posted strong Q1 2026 results, with revenue rising 32.4% year over year to RMB 6.16 billion and non-GAAP operating income jumping 70.2% to a record high above RMB 190 million. Management said the gains were driven by growth in recycling, resale and direct-to-consumer sales.
• The company’s 1P-centric strategy continued to gain traction, with compliant refurbished product revenue up 76.1% and 1P2C making up 45.1% of product revenue, versus 33% a year earlier. ATRenew also expanded its physical fulfillment network to 2,156 stores and 2,248 door-to-door professionals, helping lift face-to-face fulfillment to 80%.
• Marketplace and multi-category recycling businesses scaled rapidly, as PJT Marketplace merchants nearly doubled to almost 2 million and multi-category recycling GMV rose 81.5% year over year. ATRenew also guided Q2 revenue of RMB 6.24 billion to RMB 6.34 billion, implying 25% to 27% growth.

ATRenew NYSE: RERE reported first-quarter 2026 revenue and non-GAAP operating income growth that management said reflected continued expansion of its recycling and resale model, stronger direct-to-consumer sales and growth in its marketplace and multi-category recycling businesses.

On the company’s earnings call, Chief Financial Officer Rex Chen said total revenue rose 32.4% year over year to RMB 6.16 billion, exceeding the high end of ATRenew’s guidance. Non-GAAP operating income increased 70.2% to more than RMB 190 million, which the company described as a record high.

“As China’s circular economy continues to advance and trade-in programs for consumer electronics remain ongoing, we sustained strong growth momentum in the Q1,” Rex Chen said, according to the company’s translated remarks delivered by Head of Investor Relations Jessie Jin.

1P Strategy and Refurbished Devices Drive Growth

Founder, Chairman and Chief Executive Officer Kerry Chen said ATRenew continued to advance a “1P-centric strategy,” focused on strengthening its core business in recycling and trading secondhand consumer electronics. Management highlighted efforts to increase first-hand supply sources, improve refurbishment output and raise the share of product revenue coming from direct-to-consumer channels.

Within the company’s JD.com sourcing channel, trade-in order volume outpaced overall growth, with its volume share increasing to about 70%, management said. ATRenew said it continues to work with JD.com on trade-in solutions as government support for consumer electronics trade-ins remains in place.

The company also said it expanded face-to-face fulfillment. As of the first quarter, ATRenew had a network of 2,156 stores across major cities and 2,248 door-to-door service professionals. Management said those capabilities raised the face-to-face fulfillment ratio to 80%.

Compliant refurbished product revenue increased 76.1% year over year during the quarter, while revenue from the company’s on-demand refurbishment model rose roughly 180%. ATRenew said retail revenue from refurbished devices across Paipai Selection, its official website and new media channels grew nearly 150% year over year. In March, monthly retail sales of compliant refurbished products exceeded RMB 200 million.

As a result, 1P2C accounted for 45.1% of product revenue in the first quarter, up from 33% a year earlier and 41.7% in the prior quarter. Management said the shift allows the company to better align recycling prices with retail trends and create more value for end users.

Marketplace and Multi-Category Recycling Expand

ATRenew’s 3P business also grew during the quarter. Management said PJT Marketplace delivered healthy growth in scale and revenue, supported by new user onboarding and initiatives such as free shipping on the first three orders for new users. The company said it is applying capabilities developed for large clients to small and medium-sized merchants in an effort to streamline platform use and improve transaction efficiency.

By the end of the first quarter, total registered merchants on PJT Marketplace had nearly doubled year over year to almost 2 million. Registered contracted buyers increased by more than 120%, which management attributed to demand from small and micro buyers seeking value-for-money products. The overall 3P service take rate was 4.92% in the quarter, in line with the company’s expectations.

ATRenew also reported rapid growth in multi-category recycling. Overall recycling gross merchandise value for that business increased 81.5% year over year, including 83.3% growth in gold recycling GMV and 58.8% growth in secondhand luxury recycling GMV. By the end of March, multi-category recycling services were available in 966 AHS stores, nearly 300 more than a year earlier.

Margins Improve as Revenue Mix Shifts

Net product revenue increased 34.4% year over year to RMB 5.73 billion, largely due to growth in online sales of pre-owned consumer electronics. Net service revenue rose 10.4% to RMB 430 million, driven primarily by PJT Marketplace and the multi-category recycling business. Multi-category recycling contributed more than RMB 83 million in revenue, or 19.3% of service revenue.

Rex Chen said merchandise costs increased 33.2% to RMB 4.82 billion, in line with product sales growth. The gross profit margin for the 1P business improved to 15.9%, compared with 15.2% in the prior-year period. Management attributed the improvement to efficient consumer-to-business recycling scenarios, refurbishment capabilities and a more diversified retail channel mix that increased the share of higher-margin retail sales.

Non-GAAP fulfillment expenses increased 22.7% to RMB 520 million, while declining as a percentage of revenue to 8.5% from 9.1%. Non-GAAP selling and marketing expenses rose 27% to RMB 490 million, but decreased as a percentage of revenue to 8.0% from 8.3%. Non-GAAP general and administrative expenses were RMB 79 million, or 1.3% of revenue, flat year over year as a percentage of sales. Non-GAAP research and development expenses increased 36.4% to RMB 72.3 million.

Cash Position, Buybacks and Guidance

As of March 31, 2026, ATRenew had RMB 1.72 billion in cash and cash equivalents, restricted cash, short-term investments and funds receivable from third-party payment service providers. Rex Chen said the company’s financial reserves are sufficient to support reinvestment and shareholder returns.

During the first quarter, ATRenew repurchased approximately 0.5 million American depositary shares for about $2.7 million. The company said that under a $50 million share repurchase program authorized on June 30, 2025, it had repurchased approximately $11 million of shares as of March 30, 2026. Management also said the board authorized a 12-month extension of the existing program from June 30, 2026, with key terms unchanged.

For the second quarter of 2026, ATRenew expects total revenue between RMB 6.24 billion and RMB 6.34 billion, representing year-over-year growth of 25% to 27%. The company said the outlook reflects its current and preliminary view of market and operating conditions.

Management Points to Full-Year Momentum

In response to an analyst question about full-year expectations, Kerry Chen said the company is pursuing its annual operating targets and continues to prioritize the 1P business. He cited government trade-in programs, expanded eligible categories, subsidy support and investments by brand manufacturers and platforms as factors helping ATRenew secure more first-hand supply efficiently and at lower cost.

Management also said overseas revenue grew rapidly year over year in the first quarter, supported by ATRenew’s domestic inventory base and compliant export supply chain capabilities. The company said it is exploring opportunities to bring resourcing, fulfillment, platform capabilities and automation technologies to overseas markets while remaining disciplined in international investment.

On inventory, Rex Chen said the increase in the first quarter was consistent with the company’s strategy of strengthening 1P2C sales. He noted that inventory turnover days for direct-to-consumer retail are generally longer than bulk sales, but said ATRenew does not expect the inventory increase to have a significant impact on turnover in its core businesses.

About ATRenew NYSE: RERE

ATRenew Inc, through its subsidiaries, operates pre-owned consumer electronics transactions and services platform in the People's Republic of China. It primarily sells mobile phones, laptops, tablets, drones, digital cameras; and vintage bags, watches, liquor, gold, and various household goods through its online platforms and offline stores, as well as provides services to third-party merchants to sell the products through its platforms. The company was formerly known as AiHuiShou International Co Ltd.

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