Quhuo Limited Q3 FY2021 earnings call

• Total revenues grew 44% y-o-y to RMB 1.1 billion, in line with prior guidance. • On-demand delivery revenue was RMB 1.05 billion, up 38% y-o-y, with 159 million delivery orders, up 59% y-o-y. • Housekeeping Solutions revenue was RMB 21 million, up 538% y-o-y, becoming the second largest business line. • Mobility business revenues were RMB 34.6 million, up 364% y-o-y, with new freight service launched in July 2021. • Multi-scenario deployment had cumulative workers in 2 or more jobs at ~22,700, up 28% q-o-q. • R&D expenses doubled from a year ago, with new Laizhenge platform launched. • Achieved RMB 19 million net income in Q3, compared to net loss of RMB 10 million in same period last year.

Quhuo's total revenues grew 44% y-o-y to RMB 1.1 billion. The on-demand delivery business was the biggest revenue contributor with revenue reaching RMB 1.05 billion, up 38% y-o-y, accounting for a significant portion of total revenue. The Housekeeping Solutions business saw revenues increase 538% y-o-y to RMB 21 million, becoming the second largest business line. The Mobility business had revenues of RMB 34.6 million, up 364% y-o-y.

• For Q4, total revenues expected to be in the range of RMB 1,050 million to RMB 1,150 million, representing an increase of 20.6% to 32% year-over-year.

• Discussed impact of COVID-19 containment measures, but still captured business opportunities. • Gross margins under pressure in Q3 due to one-time costs from technology and hardware investments for growth, including labor recruitment and winter equipment preparation as one-time in nature. • Labor supply and extreme weather as factors affecting costs.

Q: Did you guys see weakness in consumer demand from COVID variant and Delta, and if trends normalized for 4Q?

A: Leslie Yu stated that despite COVID containment measures, they captured business opportunities and expect strong growth in Q4 with sustained demand.

Q: How much of gross margin pressure in 3Q is one-time and forward gross margin outlook?

A: Sandra Ji explained gross margin pressure in Q3 was due to one-time costs from labor recruitment and winter equipment preparation for Q4 growth, and expected first quarter gross profit margin to be better than Q3.