EM

• Energy Monster showed resilience in Q2 2024, returning to GAAP profitability with net income of RMB9 million. - GMV of mobile device charging service had year-over-year decrease due to soft consumption, with month-on-month fluctuations. - POI count in third- and lower-tier cities increased over 20% YOY; first-tier city POIs slightly increased. - Diverse POI categories had varying performances: restaurant, shopping, beauty, transportation saw QOQ GMV increases; entertainment and hotel experienced QOQ declines. - 89.2% of POIs operated under network partner model by end of Q2, up from previous quarters. - Over 12,000 network partners, expanded into over 50 new county-level areas. - Optimized underperforming POIs under direct model, secured partnerships with leading KA chains. - Began exploring opportunities outside China for diversification.

• Continue emphasizing network partner model as core growth driver in China, direct model in high-tier cities and key accounts. - Proactively exploring opportunities outside China for diversification. - Other revenue from new business segments is a growth avenue, already at break-even with small profit as of July.

For the second quarter of 2024, revenues were RMB462.9 million. Mobile device charging revenues, making up 88.7% of total revenues, were RMB410.6 million. Direct model revenues were RMB118.1 million, down 60.7% year-over-year. Network partner model revenues were RMB292.5 million, down 59.7% year-over-year. Other revenues, accounting for 11.3% of total revenues, reached RMB52.3 million, a 453.7% year-over-year increase.

• Softer consumption environment impacting mobile device charging service GMV. - Transition challenges between direct and network partner models. - Risks associated with international expansion into new markets.

Q: Please share more color about the progress of the second half this year, both in terms of the power bank business and other initiatives, and margin outlook.

A: Market in Q2 was challenging with no definitive rebound sign. Focus on strengthening operational scale and efficiency, expanding network partner coverage, key account acquisition, optimizing POI quality. Other initiatives like renewable energy are trending up and have potential. Margin for renewable energy initiative depends on scale, industry standard around 8%-10% gross margin and 3%-5% net margin.

Q: What would be the equilibrium for the direct and the partner model in the near future and how to work with KAs with most regions under network partner model?

A: Vast majority of POIs and GMV will be from network partner model, rough estimate around 5%-10% GMV by end of year. For KAs, KA team works with network partner team to expand key account penetration; new KAs are secured by KA team then network partner team finds suitable partners, with service and maintenance commitment remaining unchanged for KAs