KE Holdings Inc. Q4 FY2025 earnings call

1. In 2025, initiated strategic pivot from sales-driven to efficiency-driven growth. Implemented initiatives to optimize business model, leverage technology, and improve cost structure. 2. Free revenue remained stable with diversified and counter-cyclical business structure. Non-housing transaction business revenue accounted for 41% of total. 3. Operational efficiency improved: fixed labor costs in in-home business declined; contribution margin of existing home and new home businesses improved; home renovation business narrowed operating losses; home rental services turned profitable. 4. Total share repurchase in 2025 reached approximately US$921 million, final cash dividend plan announced, full-year total shareholder return about US$1.22 billion. 5. In Q4, PTV and revenue declined due to high base; profitability affected by cost optimization expenses. 6. In existing home business, scale declined but profitability improved; GTV outperformed revenue. 7. In new home business, scale declined but profitability improved due to cost structural optimization. 8. In home renovation and services, revenue declined but core cost structure improved. 9. In home rental services, revenue growth driven by rental units under management; contribution margin improved due to product model upgrade and operational efficiency gains. 10. In 2025, improved operational governance, upgraded strategy leveraging data and AI, shifted growth model from scale to efficiency and value creation, worked on four key areas for transaction services, and made progress in major business segments like existing home, new home, home renovation and furnishing, home rental.

In 2025, free revenue was relatively stable. Revenue from non-housing transaction business accounted for 41% of total revenue. Existing home business: Q4 PTV was RMB 482 billion, down 35.3% y-o-y and 4.7% q-o-q; revenue was RMB 5.4 billion, down 39% y-o-y and 9.2% q-o-q; contribution margin was 48.4%. New home business: Q4 PTV was RMB 207 billion, down 41.7% y-o-y and up 5.5% q-o-q; revenue was RMB 7.3 billion, down 44.5% y-o-y and up 9.4% q-o-q; contribution margin was 28.3%. Home renovation and services: Q4 revenue was RMB 3.6 billion, down 12% y-o-y and 15.9% q-o-q; contribution margin was 28.8%. Home rental services: Q4 revenue was RMB 5.4 billion, up 18.1% y-o-y; contribution margin was 10.4%. Revenue from emerging and other services: Q4 increased by 4.5% y-o-y and 16% q-o-q to RMB 459 million.

1. 2026 will focus on improving financial system and balancing efficiency and growth. 2. Continue to improve learning qualities, optimize capital and tuition structure, safeguard long-term competitive needs to create sustainable value for shareholders. 3. 2026 will be a year of validating decision support service model and strengthening service and organizational capabilities.

Q: About human power efficiency and execution under efficiency-driven growth strategy.

A: Strategic upgrade from scale-driven to efficiency-driven is about creating value for customers. Reallocate resources, concentrate on high-performance stores and agents, optimize network structure, leverage data and AI. Future growth depends on professional services and efficiency. 2.

Q: About new home business innovations and impact on business trend and relationship with developers.

A: New home business is entering new stage. Upgrade from channel player to integrated capability platform. Enhance online integration and digitalization, optimize traffic resource allocation, provide integrated solutions to developers. 3.

Q: About AI impact on real estate sector and how Beike uses AI.

A: AI will reshape industry by splitting workflow, improving efficiency of standardized tasks. Beike aims to upgrade to comprehensive housing service infrastructure. AI helps in information matching, transaction responsibility, etc. 4.

Q: About new media and KOLs in property transaction.

A: New media reflects real customer demand. Company should be customer-centered, combine content, professional service, execution, and customer trust. 5.

Q: About home renovation and finishing business supply chain and profitability inflection point.

A: Slow revenue growth was due to controlled expansion. Focus on product structure optimization, explicit and implicit cost control. Plan to widen skill expansion in 2026. 6.

Q: About home rental business long-term UE trajectory.

A: Short-term revenue contraction due to accounting change. Underlying business fundamentals: managed unit scale grows rapidly. Profitability improvement from workforce productivity, lower customer acquisition cost, product structure optimization.