The meeting announced the financial and operational results for the second quarter of 2025 for the company, with detailed interpretations by management and an open question and answer session. The discussion included forward-looking statements and risk warnings, and financial indicators have been comprehensively reviewed in accordance with both GAAP and non-GAAP standards.

In the second quarter of 2025, the company's core business and financial indicators performed excellently, with delivery volume increasing by 242% year-on-year to reach 103,181 units, with the Mona M 03 Max becoming a best-selling product. Despite facing price competition, the company still maintains a long-term sustainable growth strategy, with gross profit margin increasing to 14.3% and overall gross profit margin reaching 17.3%. Free cash flow exceeded 2 billion RMB, and cash reserves reached 47.5 billion RMB.

G7 is equipped with a self-developed Turing AI SOC, leading in sales, with automatic treatment functions accounting for over 50%. The Ma plus Ultra experience marks the beginning of a new chapter in the industry. Quantum super electric vehicle models will be mass-produced in Q4, upgraded to an intelligent dual-energy system platform in 2020, including advanced AI models based on vision, Turing AI SOC Ultra charging battery units, and Kunm super electric systems, achieving modular, supply chain optimization, and product cycle scalability, driving sales growth.

The dialogue discussed the comprehensive development and cross-disciplinary integration of AI in the physical world, enhancing technological leadership; attracting and retaining talent, optimizing management practices, and enhancing organizational capacity; shifting towards commercial success in products, strengthening branding, and increasing profitability; as well as integrating into global market demands, attracting international users with a long-term perspective, and showcasing unique global strategies.

The all-new P7 smart electric sedan, positioned in the 300,000 RMB price range, will officially be launched next week. This model stands out with its unique design, outstanding performance, and leading AI technology, making it the ideal choice for young consumers and indicating future design trends. Pre-sales have exceeded all previous models, with monthly sales expected to surpass 40,000 units starting in September, potentially placing it in the top three among electric sedans in its class.

In Q4, X9 QUM super electric version will be launched, with a pure electric cruising range of over 450km and a comprehensive cruising range of over 1500km, leading the same class of vehicles. In the future, multiple super electric vehicles will be equipped with top-notch pure electric cruising range and 5C super charging technology. After ten years of independent research and development, a high-performance AI chip and basic model have been built to achieve cross-domain integration, improve iteration speed, and create a physical world AI super agent. XON G7 and P7 lead L3-level autonomous driving, with all models equipped with self-developed Turing AI SOC, with a total computing power of 2250Tops, far exceeding competitors. The scale of on-board model parameters reaches billions, doubling the frame rate, to achieve a more intelligent, safer, and more environmentally friendly driving experience.

The technology company plans to launch a VLA equipped with the latest Turing SOC, aiming to become the safest intelligent assistant, simplifying and enhancing goods transportation. It is expected that within 18 months, its performance will surpass the industry-leading urban Ada solutions. By 2026, L4 level autonomous driving vehicles will achieve mass production and launch robot taxi services in selected areas. In addition, the company's humanoid robot project has also made significant progress, planning to start mass production in the second half of 2026, showcasing a new generation of robots.

Introduced a AI chip designed specifically for smart cockpits, with computing power far exceeding industry-leading levels, integrated with the VLM model. It not only enhances assisted driving, but also serves as an intelligent assistant in the vehicle, expected to master multiple languages, emotional communication, and proactive services, greatly improving the user experience of future AI vehicles. This technology demonstrates global applicability, and welcomes cooperation with top global enterprises to jointly promote the innovation of smart cockpit technology.

In the first half of 2025, overseas business performance was strong, with delivery of over 18,000 units, a year-on-year growth of over 200%, ranking top in 10 markets, especially in the high-end market. In July, the localization production of X9 in Indonesia became an important milestone. It is expected that by the second half of 2026, the quantum super electric series will be fully launched to the international market, including automatic suites, significantly expanding the global market. It is estimated that the delivery volume in Q3 will be 113,000 to 118,000 units, a year-on-year growth of 142.8% to 153.6%, and revenue is expected to reach 19.6 billion to 21 billion yuan, a year-on-year increase of 94% to 107.9%. In Q4, dual-energy intelligent driving solutions will be introduced to consolidate market leadership and promote sustainable profitability. In the next three years, the goal is to double the market share at home and abroad, and enhance global user value through AI innovation.

In the second quarter of 2025, the company's total revenue reached 1.827 billion yuan, a year-on-year increase of 125.3% and a quarter-on-quarter increase of 15.6%, mainly driven by an increase in vehicle delivery volume. Vehicle sales revenue was 1.688 billion yuan, a year-on-year increase of 140% and a quarter-on-quarter increase of 15.6%. Service and other income was 0.139 billion yuan, a year-on-year increase of 10% and a quarter-on-quarter decrease of 5%. The gross profit margin was 14.3%, with improvements both year-on-year and quarter-on-quarter. Operating loss was 0.048 billion yuan, a year-on-year decrease of 60% and a quarter-on-quarter decrease of 50%. As of the end of June, the company's total cash and cash equivalents, restricted cash, short-term investments, and term deposits amounted to 4.75 billion yuan.

Discussed means such as adjusting product layout, upgrading technology, emotional marketing, and brand building. The plan is to launch high-end models between 2026 and 2027 in order to increase the average selling price and profits, and achieve the goals of globalizing the brand and accelerating brand building.

Discussed the competitive situation in the field of intelligent driving, emphasizing the importance of supercomputing power, model optimization, and data accumulation. It is pointed out that various major players in the current market have similar performance at the software level, but can achieve surpassing by improving computing power, model and data quality. It is expected that by the end of the year, there will be a significant gap with competitors, and the following year will achieve a technological advantage of more than ten times through L4 level autonomous driving and the Ultra Trim version.

Both parties announced the deepening of their cooperation, expanding their collaboration on electrical and electronic architecture from the battery electric vehicle market in China to include more vehicle models, including Volkswagen's plug-in hybrid vehicles. It is expected that starting from Q1 of 2024, IP licensing revenue will serve as a new third source of continuous income, demonstrating the strategic value and future growth potential of the cooperation between both parties.

Discussed the possibility of launching a 2B version of the vehicle in the future to differentiate it from existing products, and inquired about whether the current product will be able to provide L4 level autonomous driving functionality through OTA next year.

The conversation discussed the development of future L4 autonomous driving vehicles, divided into two types: manned driving and unmanned driving. Emphasis was placed on the technological innovation that does not require high-definition maps and Lidar, as well as the non-necessity of software redundancy and cloud management. Differences in vehicle interaction with pedestrians were mentioned, such as robot vehicles responding to hand gestures to stop, while consumer vehicles do not. Finally, the discussion touched on plans for further expansion of trial operation and partnerships, as well as the necessary approval of policies and regulations.

Pre-sales orders for P7 far exceeded expectations, making it one of the best-selling models in history, with young males being the main purchasers. Not only is the car's exterior design attractive, but it also performs strongly on the racetrack and highway, receiving high praise from users and the media. The goal is to rank among the top three in the pure electric vehicle market in the price range of 200-300 thousand, striving to improve its ranking.

The dialogue revolves around the OEM company's robot taxi rental strategy, emphasizing the importance of technological iteration and regulatory adaptation, as well as the challenges and prospects of promoting robot taxis globally. It proposes a vision for the future of driving without navigation and OTA update technology.

Discussed the reasons for the 3.8% quarterly growth in automobile sales, pointing out that it was mainly due to changes in product mix, especially the increase in market share of new models GS and GI. These models achieved a healthy gross profit margin with technological improvements and specification upgrades. At the same time, scale production and supply chain optimization also reduced material costs, jointly driving profit growth.

Discussed the continuous increase in research and development expenses, mainly used to enhance AI capabilities, develop dual-energy platform vehicles, and expand the engineering team. Sales expenses increased in the second quarter due to high delivery volumes and product launches, and are expected to further increase in the third quarter due to more new product releases. The company is committed to continuing to invest to ensure marketing and advertising expenses adequately support product releases.

The transition of the company's product strategy was discussed, emphasizing a shift from engineering prioritization to design prioritization, placing design aesthetics at the forefront of product development. By increasing investment in the design department, it ensures that the products have no shortcomings in style and aesthetics, aiming to provide a higher quality user experience. This transition is seen as a core component of the company's long-term strategy.

The far-reaching impact of China's anti-monopoly policy on the automotive industry was discussed, emphasizing the importance of healthy competition and technological innovation. Companies actively respond to the policy by continuously innovating and optimizing products, striving to build a healthier industry ecosystem while improving supply chain relationships to ensure that partners and suppliers benefit from it and achieve long-term development.

Discussed the chip shortage issue facing the G SUV, plans to deploy a specific cockpit SOC by the end of October to address this issue, and is expected to launch the VGA and VVB models later. Currently, the G7 is unaffected and is planning to resume normal monthly production.

The conversation discussed the improvement in the profitability of the vehicle costs, pointing out that the profit margin in the second quarter has exceeded market expectations. Emphasis was placed on long-term strategies to enhance competitiveness and scale, with the goal of achieving a high profit margin in the fourth quarter and ensuring a balanced profit and loss for the whole year.

At the end of the meeting, the company thanked the participants and invited those with further questions to contact the Investor Relations department. They provided the official website and financial communication channels as follow-up contact methods, formally ending the conference call.