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Operator: Good day, ladies and gentlemen. Thank you for standing by and welcome to the Niu Technologies First Quarter 2025 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. As a reminder, we are recording today’s call. If you have any objections, you may disconnect at this time. Now I will turn the call over to Ms. Kristal Li, Investor Relations Manager of Niu Technologies. Ms. Li, please go ahead.

Kristal Li: Thank you, operator. Hello, everyone. Welcome to today’s conference call to discuss Niu Technologies results for the first quarter 2025. The early press release, corporate presentation, and financial spreadsheet has been posted on our investor relations website. This call is being webcast from our company’s IR site as well, and a replay of the call will be available soon. Please note, today’s discussion will contain forward-looking statements made under the Safe Harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks, uncertainties, assumptions, and other factors. The company’s actual result may be materially different from those expressed today. Further information regarding the risk factors is included in the company’s public filings with the Securities and Exchange Commission.

The company does not assume any obligation to update any forward-looking statements except as required by law. Our earnings press release and this call included a discussion of certain non-GAAP financial measures. The press release contained a definition of non-GAAP financial measures and the reconciliation of GAAP to non-GAAP financial results. On the call with me today are our CEO, Dr. Yan Li; and CFO, Ms. Fion Zhou. Now let me turn the call over to CEO Yan.

Yan Li : Thank you, Kristal. Hello, everyone. Thank you for joining us today. In the first quarter of 2025, we achieved a total sales volume of $203,000 units, marking a significant 57.4% year-over-year growth. Behind this strong performance was a 66% year-over-year increase in the sales volume in the China market and a 6.4% year-over-year growth in the overseas market. Total revenue for the first quarter reached to RMB682 million, reflecting a 35% increase compared with same period last year. The gross margin rebounded to 17.3% with 4.9% year-over-year increase, primarily driven by the [pump] (ph) cost reduction in product, platformization, component standardization and procurement cost improvement. The performance in Q1 2025 has set a tone for the rest of the year underlying our drive for high-volume and revenue growth, as well as the profitability improvement.

Taking a closer look at our performance in China, sales volume reached to 183,000 units in this quarter. Our [overall] (ph) product portfolio strategy emphasized on technology innovation and expanding sales channels, as well as targeting marketing strategy were the key drivers to the strong domestic performance. In Q1 2025, we maintain our focus in our key product strategy of N, M, U, and F series. We enhanced our existing products through upgrading and refining our product portfolio, which led to optimize product mix and offer our customers even more enjoyable riding experience. Additionally, we step up our motorcycle offerings, introduce model like [NX, NL, and FX] (ph). The expansion diversify our electric motorcycle range and helps to broaden our sales channel.

First, we successfully launched a comprehensive range of electric motorcycles, including the [NX, NL, and FX] (ph) series, spending price range from RMB4,000 plus to over RMB10,000. Each model features significant enhancement in functionality and smart technologies, aligning with our new performance and safety standard. Those additions have significantly expanded our electric motorcycle portfolio, offering consumers a more diverse options while reinforce our position as a premium brand in the electric two wheeler sector. So diving into detail of each product, on March 21, we first launched the NX Pro motorcycle priced at RMB9,999, positioning as the speed champion among the sub 10,000 electric motorcycles. It’s equipped with 72 volts, 42 amp hour high energy lithium battery, offering a range of over 90 kilometers on one charge.

Powered by a motor with a peak power of six kilowatt under a boost-mode, it hits the top speed of 80 kilometers power and accelerates from zero to 50 in just 5.4 seconds. The 8 amp power intelligent fast charging system allows for full charge in only five hours. The NX Pro received around 2,000 preorders and set a sales record on platform like Douyin, JD.com and Tmall on its launch date. This model has established itself as a pioneer in the high end two wheel motorcycle market, reinforced news reputation for high performance and attracting a younger demographic that value speed and innovation. It significantly boosts our presence in the premium electric motorcycle segment. We’ve also launched our entry level NL, the smart electric motorcycles.

Key upgrade includes a large footboard, extended seats, and expanded storage compartment. It comes equipped with advanced intelligent features such as full color display, TFT display with the screen measuring navigation, as well as OKGO and GoCC technologies. Powered by a 2,000 watts peak power motor, the [NL] (ph) reaches top speed of 55 kilometer per hour and includes a TCS as a standard features. Priced at RMB4,799, the NL offers a compelling combination performance, smart technology, and affordability. We also expand our F Series with the FX Pro, FX Force, and FX CD, completing the F Series product lineup on the model [sacrifice] (ph). With their both aggressive design, those models now come with enhanced features such as full color TFT display, expanded battery compartments, offering options of 72 volt 42 amp power lithium batteries or 72 volts 35 amp power the asset batteries.

Those models delivered 45 increase in the top speed and a 75 — 72% boost in the peak input power. The F series also feature two channel ABS and magic wheel, which significantly enhance playability and ease of the operation, establishing F series, as a performance powerhouse. We launched the F series on May 13 cross platform such as Tmall, JD, and Douyin, and the series is set up during starting in Q2. Now besides the electric motorcycles, we have also integrated those technologies into our electric bicycle lineup, elevating the categories with innovation technologies. We start with popular signature electric bikes models such as NXT, NLT, MT, and MMT. Those approach brings a premium electric motorcycle experience to the electric bicycle categories.

The NXT launch on the March 21 stands out as the first lap electric bicycle equipped with dual channel ABS, a 12 inch full disc motor, and a standard boost launch mode. The NXT seamlessly incorporated top tier electric motorcycle features. Those advancements have made a highly favorite choice among the consumers, setting a new benchmark in the electric bicycles market. Now we also unveiled two new models under the M series targeting the female users, the MT and MFT. The MT stands out with ultra compact design, a vibrant color options, and user friendly features like [KoPiGo] (ph) systems, making it especially suitable for female users seeking convenience and style. The MMT, a smaller model, embrace the iconic M Series design with fresh colorful aesthetics and a comfortable riding experience tailored to a diverse preference of Gen Z female users.

As product line targeting those demographics, the M series accounted for an impressive 32% sales up in Q1, reinforcing its appeal and market success. Now in Q1, our strategic emphasis on standardizing those key product platforms has shown a sign of progress. We enhanced our R&D process and also reduce our [bond cost] (ph) contributing a significant improvement of our gross margin in the China market. The positive impact is evident in Q1 2025. Besides the product, we also rolled out a series of features in smart technologies such as a full function 5 inch TFT display, the magic wheel, all those focusing on seamless driving experience, AI smart control assistance, and AI smart ecosystem features. Also in terms of driving safety, we have partnered with [Google Maps] (ph) to develop an industry pioneer data driven dynamic safety warning system.

The system’s facility and advanced functionalities include [blind-spot] (ph) warning, a real a real vehicle approach warnings, and AI piloted traffic light navigation. This has already been implemented in our new NX, NXT models with more advanced feature to be released in Q2 and Q3 this year. We’re aiming at a significantly enhanced ride safety and uplifting overall riding experience for our customers. Now in last quarter, we also continue to enhance our brand influence of our products among the target customer groups, especially the premium consumers and Gen Z riders. On March 21, the launch of our MX Pro was marked by strategic partnership with a renowned game, Game for Peace. This collaboration introduced the new cup racing tournament within the game, which quickly topped the trending list on platform like Weibo, Douyin and Xiaohongshu.

The advertising campaign spent over a [115,000] (ph) placement across 16 major cities, targeting prominent landmarks, key business district and subway systems, and office building elevators, garnering over 2.4 billion views. Also, on May 13, we debut our electric motorcycle matrix product targeting the premium users and Gen Z users with the NX and also the FX series. The launch become a milestone in 2025 with starting sales of over RMB100 million sales in just first five hours and the volume of 10,000 units plus. Lastly, in terms of channel expansion, we continue our previous strategy with strong focus on penetrating the previous underrepresented market in China, strategically expanding our retail footprint to ensure our product reaching a broader consumer base.

We have expanded our retail footprint by opening about 384 new stores in Q1, with significant focus on tier three and tier four cities, accounting for 50% of new opening stores. This strategic expansion refine our distribution network and also pave the way for upcoming launch of electric motorcycle product in Q3. Now additionally, our online presence has been strengthened with sales improvement across multiple online channels, such as our official brand accounts, the localized accounts, regional localized account, also the 400 plus store accounts. Multi-tier strategy has posted about 10,000 live broadcasts, generating 430 million views, marking a 6 times increase compared with Q1 2024 last year. This has significantly boosted our online visibility and customer interactions contributing about 100,000 units of sales, representing 60% of our total sales volume.

Now let me turn into the overseas market. In the overseas market in Q1 2025, the sales volume reached to 20,000 units. Within the overseas market, we’ll focus on electric two wheeler market, which is the electric two wheeler mopeds and electric motorcycles. The electric two wheeler market achieved over 3 times increase due to the readiness we put in place on the direct distribution operation in those key countries, such as Germany, Italy, and France. And those direct operations contributed more than 50% sales in Q1. Now with the logistic financing CRM system, also the on the ground team, we have really built the operation in those key countries and accelerated in our network expansions. By end of Q1 2025, the number of dealers in those direct distributed regions have increased from 120 to 180 dealers with projection to reach about to 250 dealers by mid-2025, exceeding our initial forecast.

We have also introduced a full line of electric two wheeler products, spanning from 50 cc equivalent [LL, LYE] (ph) models to 125 cc equivalent [Ultra E] (ph) models, as well as the off road motorcycles. Those products price between EUR2,000 to EUR4,600 catering to a diverse consumer needs. Now the first batch of new product was shipped in Q12025 and now it’s been stopped in local warehouse, ready for the peak season sales in Q2. Now with those full lineup of electric tooler products, specifically electric motorcycles, mopeds and [optical motorcycles] (ph), and also the direct distribution operation in place, we anticipate exponential sales growth targeting 3 times to five times increase in 2025 with Q1, as the early indicator of such growth.

Now the fast growth in the electric two wheeler sectors with the direct distribution region sales anticipate accounting for 60% to 80% of sales will contribute significantly our profitability turnaround in the international market. Now for the micro micromobility market for the international markets such as the kick scooters and the e-bikes, Q1 2025 is the underperforming quarter with nearly flat volume growth and delayed profitability turnaround due to the tariff situation in the U. S., and also the inventory clear-out in Europe. In Europe, our Q1 sales focus on sales out of all these inventories, hence have impact of gross margin and profitability. Those [other inventory] (ph) impacts will continue partially into Q2, but we expect to be minimized by second half of this year.

Now in the U.S., due to the uncertainties around the tariff situation, we deliberately hold back the sales of existing inventories in the US market in Q1 for more clarity. We have implemented the price increase in online channels in Q1 and negotiated with offline channels for price increases to be effective in late Q2 and early Q3. Now for the supply to the US market, our manufacturing in Southeast Asia have already dispatched our first deliveries in late Q1 2025, taking advantage of the 10% tariff bundle. The shipped product has not been reflected in the sales yet. Now we are carefully watching the tariff situation. However, with the negotiate price increases and the inventories prior to the tariff hike, we expect to regain profitability for the second half in 2025 for the U.S. micro-mobility market.

Now overall, we remain optimistic about the China market in Q2 2025, building on strong foundation in product channel development and also the brand momentum. This has already produced the positive initial results in Q1. On the product side, we’ll continue to focus on product portfolio around our core [N, M, U, and F] (ph) series. The launch of newly upgraded N and F series in Q2 is expected to elevate our brand attractiveness and recognition within the high premium consumers and the Gen Z customers. Simultaneously, the launch of motorcycle product has diversified our product portfolio, offering consumers a wide array of options. Also, we have moved up the launch of a new product in Q2 to May 13, right before the China top sales season of June 18 to take advantage of this.

Now we’ll continue to expand our sales channels, expecting to adding another 300 to 400 stores in Q2. The channel expansion will drive sales growth, but also shows the sign of channel momentum turnaround this year. Now lastly, we’ll continue to improve our gross margin as a result ratio via product optimization in Q1. And then finally, we have worked diligently to modify our current product lineup to create new design style to cope with the new electric bicycle standard in China to be in place in September. We have a solid product lineup in development, ready to be in the market by then. Now looking at the international market, with the trend we observed in Q1 and early Q2, we anticipate a steady growth in the overseas market and turnaround profit loss this year.

In the electric scooter market, with a complete product portfolio and established direct distribution operations, we anticipate a hyper growth in both revenue and profit contribution. The sales growth we saw in Q1 is a testament to this foundation we have built. In the following quarters, our focus will be expanding the direct distribution operations as it yield a higher contribution margin. For the micro mobility market, even with the turmoil on the tariffs, we have started off the return of rough science from profitability perspective. With the clearing out of the out state inventory in Europe, as also the clarity with The U. S. Tariff situation, we expect to rebound with the moderate growth and a significant improvement in the profitability.

Now I’ll turn over to our CFO, Fion Zhou, to talk about the financials.

Fion Zhou : Thank you, Yan, and hello, everyone. Please note that our press release contains all the figures and comparisons you need, and we have also uploaded the Excel format figures to our IR website for your easy reference. As I review our financial results, I’m referring to the first quarter figures unless I say otherwise. And all monetary figures are in RMB, not specified. As Yan just mentioned, our total sales volume for the first quarter was 203,000 units, up 57% compared to the same period of last year. 183,000 units were sold in China, while the remaining 20,000 were sold overseas. The total revenue for the first quarter amounted to RMB682 million an increase of RMB177 million or 35% compared to the same period of last year.

The China revenues were RMB608 million accounting for 89% of the total revenues. Of this, the scooter revenue were RMB546 million a year-over-year increase of 39%. And this increase was mainly due to the increase in sales volume and partially offset by a decrease in revenue per e-scooters. China scooters ASP was fell to nearly RMB3000. This decline in ASP was primarily attributed to a shift in product mix. The notable increase in sales volume of high end [lead-asset] (ph) models, as mentioned in the previous quarters last year, has led to a more concentrated retail price range from RMB3000 to RMB7000. And the overseas revenue was RMB74 million, representing 11% of the total revenue. The scooter revenues including electric motorcycles, mopeds, kick scooters and e-bikes amounted to RMB60 million up from RMB49 million in the same period of last year.

And this growth was driven by stronger international demand for electric motorcycles and mopeds, which command higher retail price and the premium pricing of these products also contributed to a year-over-year increase in the overseas scooter ASP, rising from RMB2,577 to RMB2,962. And the revenue from accessories, spare parts and services amounted to RMB76 million a 20% increase compared to the same period of last year due to the increase in the spare parts sales in both China and overseas markets. The gross profit for the first quarter exceeded RMB118 million marking a significant improvement compared to RMB96 million during the same period of last year. And the gross margin was 17.3%, 1.6 ppt lower than the same period of last year, but 4.9 ppt higher than the previous quarters.

The domestic market gross margin improved due to the successful cost reduction initiatives, which increased the overall GM by 1.2 ppt. However, the overseas kick scooters margins dragged down the total gross margin by 2.8 ppt, primarily due to the three factors: the impact of 25% of the U. S. Tariffs implemented last June elevated freight cost and aged inventory write-downs. The operating expenses for the first quarter were RMB165 million, remaining flat compared to the same period of last year. However, the OpEx ratio declined significantly from 32.7% to 24.2%. Selling and marketing expenses rose by RMB9 billion year-over-year to [RMB115 million] (ph) driven by a higher staff cost, advertising and promotional activities and rental expenses.

Selling and marketing expenses accounted for 16.8% of revenue, down from 20.9% in the first quarter of 2024. R&D expenses increased by RMB1 million year-over year to RMB30 million primarily due to the higher staff costs and share based compensation. The R&D expenses as a percentage of revenue is 4.4% compared to 5.7% in the first quarter of 2024. G&A expenses decreased by RMB10 million year-over-year RMB21 million largely attributed to the foreign currency exchange gains. And G&A expenses, as a percentage of revenue was 3%, a notable reduction from 6.1% compared to first quarter in 2024. In the first quarter, we had a net loss of RMB39 million with the net loss margin of 5.7% under the GAAP accounting, compared to a net loss of RMB55 million with a net loss margin of 10.9% for the same period last year.

The adjusted net loss was RMB31 million with an adjusted net loss margin of 4.6%. And turning to our balance sheet and cash flow, we ended the quarter with RMB963 million versus RMB1.1 billion last year. In cash, restricted cash, term deposits and short term investments and our operating cash outflow amounted to RMB154 million. The OpEx for the first quarter amounted to RMB24 million reflecting an increase of RMB3 million compared to the same period of last year. And this can be attributed primarily to an increase in the opening of new stores in China. Now let’s turn to guidance. We expect the second quarter revenue to be in the range of RMB1.3 billion to RMB1.4 billion, an increase of 40% to 50% year-over-year. Please be aware that this outlook is based on the information available as of the date and reflects the company’s current and preliminary expectation, which is subject to change due to the uncertainties relating to various factors.

And with that, we’ll now open the call for any questions that you may have for us. Operator, please go ahead.

Operator: Thank you. [Operator Instructions] We will take our first question. And the first question comes from the line of Kyle Wu from Citi Research. Please go ahead. Your line is open.

Kyle Wu: Thank you, operator. Hi. This is Kyle from Citi. Thanks for taking my questions. I have two questions. First is about the sales volume guidance. At the year beginning, we guide 2025 full year sales volume to be 30% to 50% year-on-year growth. Do we still maintain this volume guidance? Second is about the margin. What’s our margin outlook for the upcoming quarters of this year? And also, do we still expect second quarter to see net profit turnaround? Thank you.

Yan Li: Let me take the first one. In terms of our guidance for the annual volume, we haven’t reached we have not changed the guidance. I think we’re on the path.

Fion Zhou: Okay. For the gross margin annually, actually last year, our overall gross margin was only 15.2% overall. And for sure, this year, the annual gross margin will be recovered from 15%. And for the second quarter this year, we still expected that we will get the profit from the net margin. So the NP is the positive expectation for us.

Kyle Wu: Okay. Thank you.

Operator: Thank you. [Operator Instructions] We will take our next question. And the next question comes from the from Yating Chen from CICC. Please go ahead. Your line is open.

Yating Chen: Hello. I have one question. I have seen that the average selling price decreased quarter-over-quarter in Q1, but the gross profit margin improved significantly quarter-over-quarter. So, I’d like to know what is the main reason and what is the outlook for average selling price in subsequent quarters? This is my question. Thank you.

Fion Zhou: Okay. I’ll take this question. Actually, in this quarter, the ASP, especially the China ASP dropped due to we launched the new models. From starting from last year, the launch date of our new models, especially the flagship models varies each year. For instance, the retail price of MT 2025 models, this is our — this quarter’s best seller. The price range from RMB — nearly RMB4,000 to RMB5,000. Whereas last year, we launched the NXT in last Q1. This is our last year’s top seller and the price between RMB6,000 to around RMB12,000. So the launching date of our new models actually varies our ASP each quarter. But this ASP will smooth if we’re looking forward to the next to the following quarters, especially the [Any ASP] (ph), as we just explained to the market that the ASP will remain almost the same compared to last year or change a little bit within the single digital change.

For the second quarter after this year, actually we expected the ASP, especially in the domestic market, will recover compared to the Q1 this year. But we will concentrate it. Actually, models retail price were concentrated in the range from RMB3,000 to RMB7,000. So the ASP will rebound from this quarter’s RMB3,000 to around RMB3,000 RMB3,500 ASP in the domestic market. So this is our expectation in the quarter two ASP. And as to the gross margin recovered, as I just explained, that this quarter’s gross margin recovered, especially from our domestic scooters cost reduction. Since last Q4, we see a dramatic gross margin drop down due to our light assets, motorcycles and moped in the domestic market contributed more than 40% of our sales volume, which are 3% to 5% gross margin lower than the same year in the recent [Y-o-Y] (ph).

And we began to change the smart function platform and also the R&D platform and also the cost reduction from the raw material. And this quarter, we saw the benefit from the cost reduction in the domestic market. And in Q2, we think the gross margin will remain at this level, but will change a little bit due to the product mix in the domestic market. But we’ll now go back to lower than 15% as last year showing the figures. This is the gross margin and ASP for this year’s explanation.

Yating Chen: Thank you very much. Those are all my questions.

Operator: Thank you. [Operator Instructions] We will take our next question. And the question comes from the line of Michael Simmons from [Global View FA] (ph). Please go ahead. Your line is open.

Unidentified Analyst: Thank you. Yes, it’s Michael here, Michael Simmons. Hey, Dr. Li, perhaps I can just ask you a little bit about the balance sheet. I think it’s the cash position is kind of come down a little bit. Given what you’ve just been talking about, and it sounds like the second quarter is looking quite good. How do you think the cash position the net cash position is going to look at the end of the year?

Fion Zhou: Well, actually, each year, the quarter one, the cash position is the lowest. Since it’s the Chinese New Year, we need to clear up all the advance to the suppliers, the accounts payable and also the notes payable to the bank. So if you’re looking back to 2024 and 2023 each year, the fourth quarter cash balance is the lowest during the whole year. But at the end of this 2025, actually we expected the cash position will grow up starting from quarter two since the peak season, both in the domestic market and the overseas market is coming. And we give a high speed sales volume increase aligned with the revenue increase. And this will brought us the operating cash flow inflow starting from quarter two. And we didn’t expect a large CapEx for the furniture and equipment and also the stores opened. So overall, we think the cash position at the end of this year will be higher than the end of December ’31 in 2024.

Unidentified Analyst: Great. Thank you.

Operator: Thank you. We will take our next question. Your next question comes from the line of [Zayan Wanyan from Seville Capital] (ph). Please go ahead. Your line is open.

Unidentified Analyst: Okay. This is Daniel from Seville Capital and I have only one question. It’s regarding overseas business. Why as we know that why scooter revenue has been negatively impacted by tariffs? Electric motorcycle sales has strong growth. How should we interpret growth rate target for overseas operations under these circumstances? Thank you.

Yan Li: I think for the overseas growth rate, we remain, you know, to be we haven’t really changed throughout our forecast for this year. I think even at the last quarter, we talked about the last year results, think in the forecast of this year, we know that our electric tool or the electric motorcycle market, the growth rate will be quite high because they start with actually, you know, last year when they did about 3,000 plus units of electric motorcycles. And then during our peak time, we actually did close to way above 20,000 units. So we look at, you know, that you know, the starting from 3,000 units last year, look at fast, really a hyper growth this year, looking at somewhere at least 5 times to 6 times growth on the electric motorcycle side.

On the — Q1, the quarter one, where you see a 3 times growth there. On the micro mobility, basically the kick scooters, so we — the US tariff really started to impact us last year when our tariff actually increased to 25% on May 30 post May 31st, last year. So that already have the impact on our scooter business. So we actually start to relocating the manufacturing base from China to Southeast Asia to try to cope with that 25% tariff, where back then in Southeast Asia, it was the 0% tariff. So I mean this quarter, Q1 this year, you know, we see, you know basically, this tariff goes — even the Southeast Asia tariff went up to 10%, but China’s actually went up significantly. So we actually consciously made adjustments saying by holding off the sales for the US market.

But you look at the entire year, I think the demand there with our Southeast Asia manufacturing base in place, also with how we negotiate the price increase with the key U.S. Retailers like Best Buy, Walmart, I think we should be able to see that business goes as normal as what we expected at the beginning of the year. But overall, I think our with the micro mobility both on the US, Europe, I think our key three footprint are US market — well the entire North American market, basically US and Canada, and also the European market, as well as some of the subs, the Australian market, New Zealand market. We expect moderate growth, we don’t expect that business grow at 2 times or something, we really expect simple double digit growth and with the key goal is actually a turnaround the profitability.

I think if you look at this two international market segments with the electric motorcycle, I think it is a hyper growth with the high profitability contribution and on the kick scooter micro-mobility market, you really should expect this moderate growth, but with the key focus on turning around from a profit loss to a profitability business unit. Thank you.

Unidentified Analyst: Great. Thank you.

Operator: There seems to be no further questions. I would like to hand back for closing remarks.

Yan Li: Thank you, operator, and thank you all for participating on today’s call and for your support. We appreciate your interest and looking forward to reporting to you again next quarter on our progress. Thank you.

Operator: This concludes today’s conference call. Thank you for participating. You may now disconnect.