ATRenew Inc. Q3 FY2025 earnings call

Third-Quarter Performance Highlights

• Total net revenue hit RMB5.15 billion, up 27.1% YoY; 1P product revenue up 28.7% to RMB4.73 billion; 3P platform service revenue up 11.6% to RMB420 million.
• Non-GAAP operating profit reached RMB140 million, up 34.9% YoY, with margin at 2.7%.
• Strengthened retail capabilities led to compliant refurbished product revenue surging 102% YoY; 1P2C revenue up over 70% YoY, accounting for 36.4% of 1P revenue.
• Expanded AHS store network to 2,195 locations; AHS official website orders up 30%, JD.com trade-in program popular; offline fulfillment capabilities enhanced with 1,962 team members for two-door service.
• AI and automation deployed in inspection, customer service, etc., to optimize operations.

Three-Stage Development Strategy

• Stage 1: Reinforce second-hand consumer electronics core capabilities via enhancing scenario, fulfillment, retail sales, and technology capabilities.
• Stage 2: Accelerate AHS Recycle as leading recycling brand by combining in-store fulfillment and asset-light platform for multi-category recycling, expanding into community scenarios.
• Stage 3: Prepare international strategy by engaging in export standard development and channeling China-sourced devices overseas, aiming to replicate platform capabilities globally.

Total net revenue reached RMB5.15 billion, up 27.1% YoY. 1P product revenue was RMB4.73 billion, up 28.7% YoY, contributing 91.8% to total revenue. 3P platform service revenue was RMB420 million, up 11.6% YoY, contributing 8.2% to total revenue. Non-GAAP operating profit was RMB140 million, up 34.9% YoY, with a margin of 2.7%.

2025 Outlook

• Anticipates total revenues between RMB6 billion and RMB6.18 billion YoY +25.4%-27.4%.
• Full-year 2025 total revenues expected between RMB20.87 billion and RMB20.97 billion YoY +27.8%-28.5%.
• Q4 revenue growth expected between 25.4%-27.4%.
• 2026 to maintain rapid growth driven by trading program penetration, AHS Recycle brand power, and supply chain efficiency.

Q: Recently, national subsidy policies changed. Impact on business? Outlook for Q4 and next year?

A: National subsidies for new devices under RMB6,000 had limited impact on ATRenew's premium-focused 1P business. Subsidies stimulated pre-owned electronics upgrades; AHS Recycle had over 10% trade-in penetration on JD.com. Q4 revenue expected +25.4%-27.4%; 2025 full-year revenue between RMB20.87B-20.97B.

Q: Store opening pace for Q4 and year?

A: Full-year 2025 focused on accelerating store openings; self-operated stores in tier 1/2 cities grew steadily, 88% of self-operated stores have multi-factor services; joint-operated stores collaborate with local partners; pace balanced with two-door service team expansion.

Q: Plans and targets for multi-category business?

A: Multi-category business grew rapidly; asset-light platform model less affected by policy; prioritizes high-value categories convenient for user transactions; aims to solidify AHS Recycle as go-to destination.

Q: Uptake of enhanced services and take rates in marketplace?

A: PJT Marketplace take rate stable over 6%; Pipai consignment model take rate in high single digits; multi-category transactions adjusted take rate to prioritize user value, with room for optimization in sales categories and take rate structure.