At this meeting, the company announced the financial performance for the second quarter of 2025 and conducted a detailed analysis. The meeting began with a welcome speech by the host who reminded participants of the importance of the safe harbor statement. The floor was then handed over to the CEO, who led the team in a thorough analysis of the financial data, including explanations and adjustments for non-GAAP metrics. Finally, the meeting moved on to a Q&A session, inviting investors and analysts to ask questions in order to gain a more comprehensive understanding of the company's financial situation and future strategies.

During the discussion, it was mentioned that the Brand Asset Center business maintained a strong momentum, achieving growth in revenue and quality, and its business model and strategic direction gained high market recognition. In particular, in the field of Aesthetics Central business, revenue exceeded expectations, becoming the largest revenue contributing sector for the first time, marking a key turning point in the company's years of strategic transformation, ushering in a new growth stage.

The conversation mainly revolves around Soyang Company's financial performance in the second quarter, including the situation of RMB losses, as well as the company's strategic planning for the future, such as optimizing service processes, enhancing customer experience, and strengthening brand influence to achieve long-term sustainable high-quality growth. At the same time, the rapid expansion of the company's network and continued investment, resulting in currently owning 33 centers, are also mentioned.

The report shows a significant increase in revenue from beauty services in the second quarter, as well as an increase in the number of beauty centers, the number of treatments for active users, and an improvement in operational efficiency. The beauty centers achieved positive cash flow and monthly profits in June, with high customer satisfaction and customer acquisition costs maintained at a low level. Through standardized service delivery, enhanced medical quality and user experience, and digital management, the entire process from appointment to treatment has been standardized, improving user transparency and traceability.

By launching new therapies such as Miracle Pl, Mermaid Skin Bolster, and BBC Hero, we have successfully expanded our medical asset portfolio, increased ARPU, and strengthened our competitiveness. By partnering with international IP Belly Group, we have attracted a large number of young users through immersive experiential activities, significantly increasing brand awareness and offline interaction. At the same time, we have collaborated with the Zoo team to enhance our brand philosophy with emotional stories, effectively increasing female users' perception of our brand's professionalism and market leadership.

The plan is to add approximately 50 E family medical beauty centers nationwide in the third quarter of 2023, including fourth-tier cities and less popular second-tier cities, in order to enhance market leadership. At the same time, standardize operations and innovate products will be strengthened to improve service accessibility and solidify the leading position in the Chinese medical beauty industry.

The dialogue discussed the expansion plan of the medical beauty supply chain, including product certification, cost efficiency improvement, and industry-wide chain collaboration. The goal is to increase the density of clinics in first-tier cities by 2025, cover second and third-tier cities, improve user experience and operational efficiency, consolidate core competitiveness, and create long-term value for shareholders. Meanwhile, it emphasizes digital operation support to ensure the healthy development of the platform, achieve user value innovation, and explore broader growth opportunities.

In the second quarter, the company's total revenue was 3.787 million RMB, a decrease compared to the same period last year, primarily due to a decrease in the number of medical providers subscribing to information services. Revenue from beauty treatment services saw significant growth, reaching 1.444 million RMB, exceeding expectations, thanks to the expansion of the business of branded beauty centers. Looking ahead to the third quarter, it is expected that revenue from beauty treatment services will increase significantly. The company is accelerating the construction of branded beauty center networks, aiming to reach the predetermined number by the end of the year. At the same time, the company is optimizing operational efficiency to consolidate its leading position in the industry and create long-term value.

The conversation detailed the expansion plans for 2023 and 2024, with the goal of adding 10 new centers within the year and reaching a total of 10 centers in Beijing by the end of 2025. The long-term goal is to expand the network to more cities by improving organizational capabilities, with plans to achieve a target of 100 centers within 3-4 years. While franchise models are not currently a priority, their feasibility will be assessed through pilot programs in the future to support wider expansion.

The conversation discussed the growth potential of the Chinese medical beauty market, pointing out that compared to foreign markets, the penetration rate of the Chinese market is lower, and there is a huge market space in the future. It is estimated that by 2030, it will reach about 340 billion yuan. Industry leaders, with sustainable low-cost customer acquisition, diversified supply chain support, and large-scale physical network operation capabilities, are expected to occupy about 20% of the market share, realizing nearly 260 billion yuan in market opportunities.

Discussed the future outlook of customer acquisition costs, emphasizing the importance of private domain traffic and existing customer referrals. At the same time, mentioned increasing the proportion of self-controlled products and optimizing cost structure to improve efficiency, including launching new medical aesthetic equipment and upstream injection products, as well as strategies to reduce consumable costs.

Discussed the current situation and future challenges of doctor recruitment in the medical beauty industry, emphasizing the importance of a solid talent base and standardized technological requirements in the industry. Also highlighted the support for the growth of doctors through professional training and the construction of regional centers. At the same time, introduced the transformation of the role of center managers and the use of digital management platforms to improve operational efficiency and management levels, looking forward to further optimizing the direction of digital management in the future.

The core of Soyo's product strategy was discussed, which focuses on anti-aging treatments to ensure product line consistency, emphasizes overall cost-effectiveness, and avoids relying on loss-making products to attract customers. It was proposed to optimize the product portfolio and dynamically adjust core therapeutic projects to meet changing market demands and maintain a leading position in the industry. In the future, close attention will be paid to market trends, timely launch of potential new products, and strengthening brand influence.

In the conversation, in addition to discussing the business of the Group's Aesthetics Center, the future development plan of the POW business was also discussed, including the expansion plan in Shanghai and surrounding areas. It was mentioned that although there was some fluctuation in revenue from the POW business this quarter, it still remains a key source of profit for the group, and high profit margins will be maintained through strict cost control.

With the continuous expansion of asset expansion network, the plan is to establish a more accurate merchant classification rating mechanism through user behavior and service data in order to achieve efficient conversion of high-quality traffic, including acquiring new customers and promoting standardized light medical beauty services, while meeting the needs of non-surgical and minimally invasive surgery. Through platform optimization, precise matching between merchants and users is promoted to create incremental value.