Atour Lifestyle Holdings Limited Q2 FY2025 earnings call

• Hotel Business: Focused on quality, with expansion continuing; 118 hotels opened in Q2, total 1,824 hotels in operation. Developed multiple hotel brands including Atour Series 3, 4, SAVHE, and Atour Light, with each brand targeting specific market segments.
• Retail Business: Continued strong growth with new product launches like the Deep Sleep Memory Foam Pillow Pro 3.0 and Deep Sleep Thermo-Regulating Comforter Pro 2.0, expanding product portfolio to cover diverse home sleep needs.
• Membership and Channels: Registered individual members surpassed 102 million by end of Q2, a 34.7% year-over-year increase. CRS channel accounted for 61.5% of total room nights sold in Q2, with corporate members contributing 20%.

Hotel Business

• RevPAR in Q2 2025 was RMB 343, representing 95.7% of the level in the same period of 2024. OCC reached 97.4% and ADR stood at 98.2% of their levels in the same period in 2024. For mature hotels in operation for more than 18 months, RevPAR was 94.4% of the level in the same period of 2024, while OCC and ADR stood at 96.5% and 97.8% of 2024's levels, respectively. Opened 118 hotels in Q2, with a total of 1,824 hotels in operation by end of Q2, a 29.2% year-over-year increase. Development pipeline of hotels reached 816.

Retail Business

• Retail GMV in Q2 2025 was RMB 1,144 million, up 84.6% year-over-year. Online channels accounted for over 90% of total GMV. Retail GMV reached RMB 578 million during the June 18 Shopping Festival, up more than 86% from the same period last year.

• Full year 2025 net revenues expected to increase 30% compared with full year 2024.
• Retail business full year growth guidance raised, with plans for new product launches.
• Hotel openings target 500 for full year, with expected closures between 70-80.

• Market supply increase posing challenges to the industry.
• Intensifying competition in the retail business.
• Higher effective tax rate affecting the full year net profit margin.

Q: RevPAR trend in Q3 and full year?

A: RevPAR pressure in Q3 will somewhat ease compared to Q2, while full year RevPAR recovery rate shows a gradual improving trend though the industry faces challenges overall.

Q: Hotel openings, closures, and signings?

A: Target 500 hotel openings for full year, expected closures between 70-80, with strict signing standards focusing on precise location and high quality.

Q: Retail business full year guidance and future development?

A: Retail growth guidance raised to 60% year-over-year, with new products like Deep Sleep Memory Foam Pillow Pro 3.0 launched, focusing on supply chain optimization and R&D.

Q: Full year adjusted net income margin?

A: Adjusted tax rate expected to rise to 30% this year, affecting the full year net profit margin.

Q: SAVHE and Atour Light updates?

A: SAVHE has strong market reception, with flagship store in Shenzhen performing well. Atour Light 3.3 is well-received, with strategic focus on these brands for long-term growth.