Pony AI Inc. American Depositary Shares Q3 FY2025 earnings call

• Successfully completed dual primary listing on Hong Kong Stock Exchange, raising over $800M. - Completed Gen seven robotaxi commercial launch in Guangzhou, Shenzhen, Beijing. - Fleet expanded to over 900 vehicles by November, expecting to surpass 1,000 by year end and 3,000 by 2026. - Formed partnerships with Sunlight Mobility, Hehu, etc. - Advanced global expansion with presence in 8 countries, entered Qatar, and deepened collaboration in South Korea, Luxembourg, etc. - Developed fourth generation robot truck with production and deployment in 2026. - Optimized cost and operational efficiency, reduced autonomous driving kit cost by 70% for Gen seven, and further 20% for 2026 production. - Improved fleet utilization and efficiency through algorithm optimization for dispatch, scheduling, etc.

The main segment is robotaxi services. Robotaxi services revenue reached $6,700,000.0, representing a remarkable growth of 89.5% year over year and 338.7% quarter over quarter. Fare charging revenue surged 233.3%. Robotruck service revenues were $10,200,000.0, growing by 8.7%. Licensing and application revenues were $8,600,000.0, growing significantly by 354.6%.

• Expect stronger growth surpassing 1,000 robotaxi fleet by year end and expanding to over 3,000 vehicles in 2026. - Robotaxi revenue growth to accelerate with fleet expansion. - Continue to see growth in robotaxi revenues from overseas market. - Asset light model for fleet expansion to enhance capital efficiency.

• New entrants in robotaxi face business, regulatory, and technical challenges. - Competition in the autonomous driving space. - Regulatory compliance and obtaining necessary permits in various markets. - Technical challenges in handling corner cases and scaling operations.

Q: Could the management team give some more update on the fleet size for this year and also outlook in 2026?

A: James Tong said they expect to outperform the 1,000 vehicle target by year end and aim for over 3,000 vehicles in 2026 due to the upward spiral from Gen seven launch, asset light model with partners, and deepening in existing and new markets.

Q: What is the outlook for fair charging revenues as we deploy more vehicles?

A: Liu Wang said fair charging revenue surged 233.3% in Q3 driven by demand side improvements (robust user demand, doubled registered users) and operational side optimizations (reduced wait time, expanded pickup/drop-off points), expecting sustained growth with fleet expansion.

Q: Could you elaborate more about the assumption behind the citywide unique economic breakeven?

A: Liu Wang mentioned daily net revenue per vehicle reached 299 RMB, daily average orders per vehicle 23, with cost side including hardware depreciation and operational costs like charging, remote assistant, etc., and remote assistant to vehicle ratio on track to reach 1:30 by year end.

Q: What's your take on new entry entrants in the level four autonomous driving space?

A: James Tong said more companies entering is good for industry development, but new entrants face business, regulatory, and technical hurdles. Tianqin Luo added on tech side, Pony has early mover advantage in reinforcement learning-based simulation training, staying ahead in model development.

Q: What do you see as the main factors behind the faster expansion of your operational areas? And are you using large language models?

A: Tianqin Luo said tech stack is built for generalization, key to expansion is vehicle number, and large language models are not used for onboard driving due to safety and latency issues, but used in R&D and other non-driving areas.

Q: Currently cooperating with multiple OEMs, does management see potential for improving operating leverage through working with one OEM?

A: James Tong said cooperating with multiple local OEMs helps expand into different markets quickly, showing technical generalization, and can accelerate expansion into new regions.

Q: Why Pony can use remote assistant on robotaxi when the car meets difficulty?

A: Tianqin Luo said remote assist provides suggestions without remote controlling the vehicle, system can independently drive, and remote assist to vehicle ratio is improving to 1:30 by year end.

Q: What's your view on overseas expansion?

A: James Tong said evaluate markets based on market size, local government support, and local partner resources, already in 8 countries, expect continued growth in overseas robotaxi revenues with new markets like Qatar added.