A：The conference call is for discussing Full Truck Alliance's fourth quarter and fiscal year 2025 earnings.

A：Forward-looking statements are associated with risks that could cause actual results to differ materially from those mentioned, including risks beyond the company's control, and the company does not undertake any obligation to update this forward-looking information except as required by law.

A：The senior management members attending the call are Mr. Hui Zhang, the founder, chairman, and CEO, and Mr. Simon Tai, the chief financing and investment officer.

A：Total field orders for the fourth quarter of 2025 reached 306 million, representing a year-over-year increase of 12.3%, while full-year total field orders reached 236 million, up 19.8% year over year. Notably, full-year orders for cold chain logistics grew significantly.

A：Operational performance improvements included a targeted user position strategy and a refined membership system for shippers, and the optimization of the trucker credit rating system. The number of active shippers and truckers grew, the rolling active trucker space remained at a high level, and AI-powered technology was integrated into operations.

A：The company focused on enhancing operating efficiency to strengthen profitability, resulting in net revenues of RMB 12.49 billion for full year 2025, up 11.1% year over year, and a non-GAAP adjusted net income of RMB 4.79 billion, up 19.3% year over year.

A：In 2026, the company's strategy focuses on advancing high-quality growth and intelligent transformation across Ed areas, shifting from skill-driven growth to a balance of skills and quality, improving ecosystem standards, and further integrating AI capabilities to support mutually beneficial relationships between users and the platform.

A：The company is transforming from an information matching platform into an AI-driven intelligent infrastructure, using its accumulated transaction data and active user base to advance and integrate AI in matching efficiency, credit assessment, and dynamic pricing.

A：The rise of AI agents is seen as a potential disruption to the traditional platform model for freight match platforms like FTA, as AI technology could lower barriers for shippers to find carrier capacity and improve matching accuracy and fulfillment rates. However, FTA believes AI presents more opportunities than challenges and plans to leverage AI capabilities to enhance efficiency, improve the user experience, and capture broader industry opportunities without being a disruption to its business model.

A：AI is being applied across FTA's company to enhance capabilities for the world trade industry it operates in. Key developments include the integration of AI across various areas of the platform such as matching, dispatching, pricing, risk management, and customer service to make operations more efficient. Plans for the fourth quarter involve further integrating AI capabilities and expanding its use to more scenarios across the platform. For 2026, FTA aims to continue building on these initiatives and embedding AI throughout the entire transaction workflow to improve user experience and network effects.

A：The unique aspects of FTA's platform that make it difficult for standalone AI agents to replicate include the platform's experience and data accumulated over the years, as well as the ability to handle complex logistics scenarios and high performance standards. These capabilities involve handling a variety of special and non-standardized situations, such as specific vehicle needs, cargo loading and unloading issues, sudden changes, etc., and require reliability and efficiency assessments of carriers based on historical data and real-time information. In addition, the platform also forms a stable trading network and credit system, which is essential for establishing and maintaining trust relationships, which are more difficult to replicate in individual AI applications.

A：FTA is actively integrating AI capabilities across multiple areas of its platform, including matching, dispatching, pricing, risk management, and customer service. This integration aims to make operations more efficient, improve fulfillment reliability, handle exceptions more effectively, and enhance the overall user experience for both shippers and truckers. The goal is to use AI to streamline processes, such as shipping and dispatch operations, and to support automated workflows that reduce manual steps and improve transaction efficiency.

A：FTA has progressed its AI initiatives from the experimental phase to broader deployment, building an AI agent framework that covers key scenarios across the platform. Specific capabilities being developed include simplified shipping and automated dispatch for shippers, with an AI-powered system that allows for voice input and handles the entire workflow from freight listing to order matching. AI has also been integrated into customer service operations to improve response times and processing efficiency.

A：Management prioritizes capital allocation by focusing on delivering sustainable returns to shareholders while maintaining healthy growth in the core business. This includes ongoing commitment to shareholder returns through dividends and share repurchases, as well as strategic investments in core business growth, new initiatives, and operational cost optimization.

A：The company plans to return approximately US dollar 400 million to shareholders through a Medium to Long-Term Shareholder Return Plan 2026, including a dividend of approximately US dollar 87.5 million for the first quarter.

A：The long-term vision is to continue to invest in user acquisition, technology upgrades, product innovations, and ecosystem development to support the core business's steady and sustainable growth. New initiatives such as overseas expansion and autonomous driving will be pursued with a disciplined approach, emphasizing controlled cash outflows, measurable milestones, and a focus on long-term growth capacity.

A：The slowdown in order volume growth during the fourth quarter was primarily driven by ecosystem governance initiatives implemented on the platform, rather than any significant change in underlying freight demand.

A：The governance initiatives focused on addressing misclassified carporting orders, strengthening real name verification for truckers and shippers, and implementing measures to curb freight reselling and other irregular transaction activities.

A：The governance measures primarily affected low-quality orders with limited monetization potential. Despite the shift of some orders to full load products or offline channels, transaction service revenue still grew by nearly 100% year over year in the fourth quarter, indicating that the governance initiatives have not affected the platform's core monetization capability.

A：The governance initiatives have led to improvements such as the elimination of trucker account reselling on third-party platforms, near-100% trucker vehicle verification rate, significant decrease in freight reselling activities, and maintenance of a high level of active trucker base.

A：The outlook for order growth shows clear signs of recovery with sequential order growth already improving. The share of direct shippers is increasing, and matching efficiency is expected to further improve. Looking ahead, the company remains cautiously optimistic about steady order growth on the platform.

A：In the fourth quarter, the overall fulfillment rate reached 42.7%, representing a year-over-year increase of more than five percentage points, with the average fulfillment rate for mid and low-frequency direct shippers approaching 60%. The outlook for the fulfillment rate is positive, driven by systematic improvements and the optimization of the cancellation policy.

A：The improvements in the fulfillment rate were driven by systematic changes to the cancellation policy, adjustments in imposing behavioral restrictions on users with frequent cancellations, and an upgraded credit scoring system that now gives more emphasis on overall behavior quality, performance rates, user ratings, and complaint rates.

A：The factors that contributed to the higher fulfillment rate in the fourth quarter include the continued improvement in the user mix with direct shippers accounting for 55% of total fulfilled orders, an increase in the share of direct shippers that have higher fulfillment expectations, ongoing product enhancements such as the new freight zone and a secondary confirmation step for shipment posting, and an improvement in the matching algorithm and operations that accelerated trucker response times.

A：As the credit scoring system continues to improve, the base of direct shippers is expected to expand and low-quality freight listings will be further phased out, which will maintain a steady upward trend in fulfillment performance. This is expected to enhance the user experience and support further monetization of the platform.

A：The year-over-year increase in transaction service revenue was primarily driven by two factors: the continued increase in commission penetration, where the rate reached 80% and the number of cities covered by the commission model reached effective nationwide coverage, and the improvement in monetization per order, where the average monetization per order reached RMB 26.3 due to a refined tiered operating strategy offering differentiated services.

A：The credit solution business is progressing in compliance with regulatory guidance, focusing on risk management, and transitioning towards a more asset-light approach. The business has completed the transition to interest rates of 8% or below for both existing and newly issued loans. Going forward, the business model is expected to improve with the reduction of own capital usage through partnerships with banks and financial institutions, and a focus on a more balanced and sustainable return profile.

A：The company's overseas business is an important part of its mid to long-term growth strategy. It is building its international operations under the Q Move brand, currently in the model validation and capability replication stage. The company is pursuing an asset-light and localized approach, gradually advancing investment as it validates the business model and team capabilities. The focus is on deepening the presence in existing markets and expanding into new ones in a disciplined manner, prioritizing network density and user engagement before monetization. The company remains confident in the long-term growth potential of emerging markets, similar to China's digital transformation path.