BingEx Limited (FLX) Earnings

Management highlights

Overall Business Model Resilience - Total fulfilled orders reached 57.9 million in Q1 2026, demonstrating stable performance and business model resilience amid evolving industry competition. The platform has 3.1 million registered riders, and average delivery time improved to 25.7 minutes, reflecting enhanced service efficiency and user experience. - The company maintains a healthy balance sheet with strong liquidity, supporting ongoing innovation and expansion. Merchant and User Expansion - Tiered merchant management strategy is driving improvements in service response efficiency and resource allocation. High-value core categories (cake, electronics) are driving order mix improvement, and a growing number of leading brands in automotive services, premium retail, and consumer electronics have added FlashEX as a standard fulfillment channel, strengthening the company's position in the premium on-demand dedicated delivery segment. - New scenario expansion: The company is testing a campus delivery model that leverages on-campus student part-time resources to complete last-mile delivery from campus entrances to student dormitories, addressing unmet user demand while providing flexible income opportunities. - For individual users, the company is positioning itself as an instant lifestyle assistant, expanding beyond core urgent delivery to cover a broad range of daily on-demand needs. This deepening user engagement is gradually transforming the platform from a single-purpose delivery tool to a comprehensive on-demand service entry point, improving user retention and overall platform activity. Technology and Ecosystem Openness - FlashEX became the first intra-city on-demand delivery company to open-source its core command line interface tool, standardizing and API-enabling its delivery capabilities. The open interface allows merchants to integrate FlashEX services directly with their own point-of-sale/order management systems, lets developers and enterprise clients connect directly to FlashEX's backend for pricing, ordering, and shipment tracking, and enables leading AI agents to invoke FlashEX delivery services directly, formally integrating on-demand delivery capability into the AI workflow ecosystem for the first time at a standardized level. Initial open source release covers core functions including price inquiry, order placement, tracking, and cancellation, with further iteration planned. - Additional ecosystem integrations include full Quick App integration with Huawei Harmony OS, allowing users to initiate delivery requests via conversational interaction without opening the FlashEX app, and full API opening to all major AI platforms to support standardized integration of FlashEX ordering capabilities. - AI has driven systematic operational efficiency gains across the organization: AI now handles most routine customer service complaints, reducing required agent headcount; new service scenario testing and launch timelines have shrunk from ~2 months to 1-2 weeks; new partner onboarding is fully automated via AI agents, cutting integration timelines from over a week to under one day; AI-assisted coding has improved R&D development efficiency year-over-year. These gains lower the marginal cost of business expansion while maintaining service quality. Low-Altitude Logistics Progress - FlashEX's wholly-owned subsidiary secured a strategic investment partnership with Hangzhou Low Altitude Industry Development, making the company one of the first on-demand courier providers in Hangzhou's low-altitude economy sector to receive institutional strategic backing. This milestone marks the company's transition from technology exploration to real-world commercial deployment of low-altitude autonomous delivery, a core medium- and long-term strategic priority. - The company is developing a next-generation logistics model combining rapid aerial transport with ground-based last-mile delivery to enable seamless coordination between low-altitude and ground networks, leveraging its existing nationwide ground fulfillment network covering nearly 300 cities. As of Q1 2026, the drone delivery program has entered substantive commercial operations, with 5 takeoff/landing sites and 14 active delivery routes covering key Hangzhou districts. The program has maintained a 100% safety record, and commercial viability of the model has been validated, with delivery times 20-30% faster than traditional ground delivery under normal operating conditions. Stakeholder Management - The company continues to refine rider training and service standards, and runs a recognition program for outstanding riders demonstrating social responsibility, providing material rewards and public recognition to strengthen professional pride and belonging. The company views a sustainable, professional rider team as a core cornerstone of service quality.

Guidance

The company reaffirmed three core strategic priorities for the remainder of 2026 and future quarters, maintaining its existing strategic direction without material upward or downward revisions to prior guidance: - Continue deepening AI application across internal operations to further improve organizational efficiency. - Accelerate the expansion and commercialization of low-altitude logistics, with a focus on exploring additional order types and scenarios suited to air-ground coordination. - Continue strengthening high-value merchant services and expand individual user scenario coverage to drive further improvements in order mix. Management also reaffirmed its commitment to disciplined financial execution, ongoing cost structure refinement, and expense control to expand operating margins, while pursuing prudent business innovation to capture emerging growth opportunities.

Segment performance

Total revenue for Q1 2026 reached 935.3 million RMB, a year-over-year decline from 960.8 million RMB in Q1 2025. Gross profit was 105.8 million RMB (gross margin 11.3%), down from 126.7 million RMB (13.2% margin) year-over-year. Total operating expenses were 94.8 million RMB, an 18.7% year-over-year decrease from 116.67 million RMB, broken down as 38.5 million RMB in selling and marketing expenses, 39.9 million RMB in general and administrative expenses, and 16.5 million RMB in R&D expenses. Operating income was 11 million RMB (operating margin 1.2%), up from 10 million RMB (1% margin) year-over-year. Non-GAAP operating income was 21.6 million RMB, down from 26.6 million RMB year-over-year. As of quarter-end, total cash and equivalents, restricted cash, and short-term investments stood at 859.1 million RMB. By vertical segment: 1) Cake category: 15.4 million orders in Q1 2026, achieving year-over-year order growth even against a high prior-year comparison base, and is the most stable, predictable component of the company's revenue mix. 2) Electronics category: order volume grew 15.9% year-over-year, maintaining strong momentum and acting as a key driver of order mix improvement. 3) Individual lifestyle services (assisted purchasing, parcel/food pickup, gift/luggage delivery): daily order volume remained steady in Q1 2026. 4) Low-altitude drone delivery: Q1 2026 order volume grew 157.2% quarter-over-quarter, with ~3,500 completed paid orders as of the end of Q1 2026.

Risks & headwinds

Management acknowledged that intensifying industry competition has driven a year-over-year decline in total revenue, and noted that forward-looking statements are based on current expectations, with actual results potentially differing materially from projections due to unidentified and disclosed market and operational risks. No additional specific operational risks, regulatory risks, or material operational failures were discussed in the call.

Analyst Q&A

• Q: Can you share Q1 2026 order volume and ASP trends broken down by 2B and 2C segments? Given slowing order growth and rising AOV in the broader food delivery sector, what does this trend mean for a premium provider like FlashDX? /

  A: Total Q1 orders hit 57.9 million, with stable performance reflecting the resilience of the company's dedicated delivery model. On the 2B merchant side, tiered management and focus on high-quality categories drove order mix improvement: cake category grew year-over-year even with a high base, electronics grew 15.9% YoY, and key account (KA) merchant GMV contribution improved steadily with ASP holding at a stable elevated level, strengthening the company's premium market position. On the 2C side, lifestyle service daily orders stayed steady, and the platform is expanding to cover more daily needs. FlashDX differs from mass market food delivery platforms in user profiles, use cases, and positioning; industry-wide rationalization of competition is positive for the whole industry and for FlashDX, which will continue focusing on high-value merchants, premium scenarios, AI, and low-altitude logistics to reinforce its competitive advantage.

• Q: Can you outline the strategic direction, target application scenarios, and current progress of the low-altitude logistics initiative that received strategic investment from Hangzhou's institutional backers? /

  A: Low-altitude logistics is a core medium- to long-term strategic priority, acting as an extension of FlashDX's existing nationwide ground fulfillment network. The strategic investment confirms capital market and industry endorsement of the company's fulfillment capabilities and technological innovation. The company is developing a new model combining rapid aerial transport and ground last-mile delivery to build coordinated air-ground networks. Target scenarios include high-value, time-sensitive categories where fast, reliable delivery creates clear value (cakes, flowers, premium retail, electronics), as well as geographically constrained or congested areas where ground delivery efficiency is limited. The initiative is already in substantive commercial operation in Hangzhou, with 5 vertiports, 14 routes, 157% QoQ order growth in Q1, ~3,500 paid orders, a 100% safety record, and validated commercial model with 20-30% faster delivery times than ground services. The company will continue investing to improve efficiency and expand service boundaries.