Yuanbao Insurance Q2 2026 Earnings Call - Revenue Surges 30% on AI-Driven Claims Efficiency and New Ad Vertical

Operator: Ladies and gentlemen, good day and welcome to Yuanbao Insurance second quarter 2026 earnings conference call. Today’s conference is being recorded. At this time, I would like to turn the conference over to Ms. Stella Liu, investor relations and strategy associate director. Please go ahead.

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: Thank you, operator. Please note that 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. Such statements are not guarantees of future performance and are subject to certain risks and uncertainties, assumptions, and other factors. Some of these risks are beyond the company’s control and could cause actual results to differ materially from those mentioned in today’s press release and discussion. A general discussion of the risk factors that could affect Yuanbao’s business and financial results is included in certain filings of the company with the Securities and Exchange Commission. The company does not undertake any obligation to update this forward-looking information, except as required by law. During today’s call, management will also discuss certain non-GAAP financial measures.

For a definition of non-GAAP financial measures and a reconciliation of GAAP to non-GAAP financial results, please see the earnings release issued earlier today. Joining us today on the call from Yuanbao’s senior management are Mr. Rui Fang, our chairman and chief executive officer, and Mr. Huirui Wan, our chief financial officer. Mr. Fang will deliver his remarks in Chinese, followed by an English translation. All figures will be in RMB, unless otherwise noted. We will conclude the call with a Q&A session. As a reminder, this conference is being recorded. In addition, a webcast replay of this conference call will be available on Yuanbao’s investor relations website. I will now turn the call over to our chairman and CEO, Mr. Fang. Please go ahead, sir.

Rui Fang, Chairman and Chief Executive Officer, Yuanbao Insurance: 大家好，欢迎参加元宝2026年第二季度财报电话会。2026年第二季度，公司业务保持稳健增长态势，收入规模与盈利能力同步提升。本季度公司总收入为人民币13.92亿元，同比增长30.1%。经营利润为人民币4.13亿元，同比增长35.6%，经营利润率达到29.7%。截至二季度末，公司现金储备为人民币51.6亿元，为我们持续投入AI技术研发，协同保司进行产品创新，把握行业结构性机遇提供了坚实的支撑。

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: Hello, everyone. Thank you for joining us today for our second quarter 2026 earnings conference call. In the second quarter of 2026, we maintained steady growth momentum with both revenue and profitability improving in tandem. Total revenue for the quarter was RMB 1.39 billion, a year-over-year increase of 30.1%. Net income was RMB 413.2 million, up 35.6% year-over-year, with a net income margin of 29.7%. As of the end of the second quarter, our cash reserves totaled RMB 5.16 billion, providing solid support for our continued investment in AI technology, our product innovation in collaboration with insurance carriers, and our ability to capture structural opportunities within the industry.

Rui Fang, Chairman and Chief Executive Officer, Yuanbao Insurance: 在数据与模型能力建设方面，我们持续投入。截至二季度末，公司模型矩阵已超过5,100个模型，可对超过5,900个特征进行分析，覆盖从需求识别、产品推荐到理赔协助的全流程场景，服务效率及用户体验同步提升。此外，我们上个季度宣布的$1,500万美元股份回购计划也在稳步推进。截至2026年8月31日，我们已经累计回购约11.4万股ADS，总金额约160万美元，持续践行对股东的资本回报承诺。

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: We continued to invest in strengthening our data and modeling capabilities. As of the end of the second quarter, our model matrix had exceeded 5,100 models, which are capable of analyzing more than 5,900 labels, covering the full range of scenarios from needs identification and product recommendation to claims assistance, driving improvements in both service efficiency and the user experience. In addition, the $15 million U.S. share repurchase program we announced last quarter continues to progress steadily. As of August 31, 2026, we had repurchased approximately 114,000 ADS for a total consideration of approximately $1.6 million U.S., reflecting our ongoing commitment to delivering capital returns to our shareholders.

Rui Fang, Chairman and Chief Executive Officer, Yuanbao Insurance: 近年来，商业健康险迎来广阔的发展机遇。政策端持续释放利好信号。今年3月，2026年政府工作报告明确提出加快发展商业健康险，推动创新药和医疗器械高质量发展，更好地满足人民群众多元化就医用药需求。7月，国务院印发《国民健康服务规划》，鼓励增加覆盖健康干预、特需医疗、创新药等的先行健康保险产品的供给。此前，国家金融监管总局在《关于推动健康保险高质量发展的指导意见》中明确指出，支持开发面向带病体、罕见病等特定群体的商业医疗保险产品。在此背景下，公司持续深化与保司的协同，加快产品迭代升级，坚持普惠价格加全面保障加品质服务的策略。通过降低投保门槛，丰富保障责任，提升服务体验，推动普惠型健康险保障的进一步品质扩面。

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: In recent years, commercial health insurance has seen both development opportunities backed by a continuous stream of favorable policy signals. In March this year, the 2026 report on the work of the government exclusively called for accelerating the development of commercial health insurance and promoting the high quality development of innovative drugs and medical devices in order to better meet the public’s diverse needs for medical treatment and medication. In July, the State Council issued the National Health Plan for the 15th Five-Year Plan period, encouraging an increased supply of innovative health insurance products covering areas such as health intervention, specialized medical care, and innovative drugs.

Prior to that, the National Financial Regulatory Administration explicitly stated in its Guiding Opinions on Promoting the High-Quality Development of Health Insurance that it supports the development of commercial medical insurance products targeting specific groups such as individuals with pre-existing conditions and rare diseases. Against this backdrop, we continue to deepen collaboration with insurer carriers and accelerate product iteration, adhering to a strategy built on affordable pricing, comprehensive coverage, and quality service. We are working to further improve the quality and expand the reach of the inclusive health protection by lowering enrollment barriers, enriching coverage benefits, and enhancing the service experience.

Rui Fang, Chairman and Chief Executive Officer, Yuanbao Insurance: 在产品端，元宝超医保系列医疗险根据消费者需求，历经多年迭代，已实现从基础门急诊、一般医疗到品质医疗的梯度覆盖，让不同年龄、不同需求、不同预算的用户都能找到适合自己的保障方案。今年6月，元宝超医保系列医疗险迎来全面升级。本次升级围绕用户就医全流程的痛点，在好医、好药、好康复三个维度同步发力，新增公立医院特需医疗资源，提升先进药械保障的覆盖，覆盖特定疾病的康复住院保障，推动健康保障进一步延伸至治疗加康复的全周期。值得一提的是，在实现保障大幅升级的同时，我们也始终坚持普惠定价原则，做到提质不提价。

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: On the product side, Yuanbao’s Super Medical Insurance series has improved over many years in response to customer needs and now offers tiered coverage spanning basic outpatient and emergency care, general medical treatment, and premium medical care so that users of different ages, needs, and budgets can all find a plan that fits them. In June this year, our Super Medical Insurance series underwent a comprehensive upgrade focused on addressing pain points across users’ full treatment journey. This upgrade advanced simultaneously across three dimensions: good doctors, good medicine, and good rehabilitation. It added access to special needs medical resources at public hospitals, expanded coverage for advanced drugs and medical devices, and introduced coverage for inpatient rehabilitation for specific conditions, extending health protection further across the full cycle of treatment plus rehabilitation.

Notably, even as we substantially upgraded our coverage, we stayed true to our principle of affordable pricing, improving quality without raising prices.

Rui Fang, Chairman and Chief Executive Officer, Yuanbao Insurance: 今年，元宝也积极探索带病人群的保障新路径，响应国家鼓励带病体保险的政策方向。5月，我们联合保司推出了全守护百万医疗险，实现免健康告知，责任范围内一般既往症可赔，确实降低了带病人群的投保门槛。重疾方面，我们联合保司推出了守护保百万医疗重疾险。在免健告版本，进一步推动重疾保障覆盖更多有需求的人群。从医疗险到重疾险，元宝以产品创新持续拓宽健康保障的可及性，切实回应超4亿带病体人群的真实保障需求。

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: This year, Yuanbao has also been actively exploring new approaches to protection for individuals with pre-existing conditions, responding to national policies that encourage insurance for this population. In May, we partnered with insurers to launch Complete Guardian · Million-RMB Medical Insurance, which waived health disclosure requirements and covers general pre-existing conditions within the scope of benefits, effectively lowering the eligibility threshold for individuals with pre-existing conditions to obtain medical protection. On the critical illness side, we launched a no health disclosure version of Guardian Insurance million RMB critical illness insurance, further extending critical illness protection to more people who need it. From medical insurance to critical illness insurance, we continue to use product innovation to broaden access to health protection, directly addressing the real protection needs of the more than 400 million people in China living with pre-existing conditions.

Rui Fang, Chairman and Chief Executive Officer, Yuanbao Insurance: 在技术创新方面，公司持续推进多模态人工智能技术在保险业务场景中的应用，建设了面向保险领域的多模态理解与分析能力。保险业务中存在大量的图片、文档、视频、文本等非结构化的信息，元宝依托多模态模型和专业的技术体系，让AI更准确地精准地识别、理解和分析这些复杂的内容，把原本难以利用的非结构化数据转化为真正可用的数据资产。

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: On the technology innovation front, we continue to advance the application of multimodal AI technology, of course, insurance business scenarios, building multimodal understanding and analysis capabilities tailored to the insurance industry. Insurance operations involve large volumes of unstructured information, including images, documents, videos, and text. By leveraging our multimodal models and proprietary knowledge system, Yuanbao enables AI to more accurately recognize, understand, and analyze this complex content, turning unstructured data that was once difficult to put to use into truly usable data assets.

Rui Fang, Chairman and Chief Executive Officer, Yuanbao Insurance: 在理赔协助服务场景中，公司利用多模态模型，智能解析病例诊断证明、医疗票据检查报告等多类型材料，实现材料识别、信息提取、事实整理和审核辅助。系统还能将不同来源材料中的关键信息进行关联分析，形成结构化的理赔事件档案，并结合保险知识库辅助责任分析和用户服务，以此来提升保岁的理赔处理效率、审核尺度一致性和用户的体验。目前相关能力已在医疗险理赔协助场景中落地，材料分类准确率达到95%，关键字段抽取平均准确率约94%。相较此前测试的供应商方案，现有的方案的处理效率和准确率均实现了提升。

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: In claims assistance service scenarios, we applied multimodal models to intelligently parse various types of materials, including medical records, diagnostic certificates, medical invoices, and examination reports, enabling document recognition, information extraction, fact consolidation, and review assistance. The system also cross-analyzes key information across materials from different sources to generate structured claims case files, and combines with our insurance knowledge base to support liability analysis and user service, thereby improving insurance carriers’ claims processing efficiency, consistency in review standards, and user experience. These capabilities have already been deployed in medical insurance claims assistance scenarios, achieving material classification accuracy of 95% and an average key field extraction accuracy of approximately 94%. Compared to the vendor solutions previously tested, our current solution shows improvement in both processing efficiency and accuracy.

Rui Fang, Chairman and Chief Executive Officer, Yuanbao Insurance: 在用户增长场景，公司利用多模态模型对业务内容进行智能理解和分析。我们能有效识别图片、视频、文本等内容中的产品信息、表达特征和用户反馈等。在结合业务效果数据，辅助内容分析和策略优化，提升了用户触达效率和业务运营的能力。同时，公司持续建设保险领域的专业知识库。我们围绕保险产品条款、医疗知识服务流程、理赔规则和历史案例等核心内容进行结构化锁定，形成了支撑AI应用的专业基础知识库。公司还将知识库和多模态模型智能体技术深度融合，进一步提升了AI在复杂保险场景中的准确性、可解释性和业务适配能力，推动保险服务由传统人工处理模式转向AI辅助人机协同模式演进。

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: In user growth scenarios, we applied multimodal models to intelligently understand and analyze business content. In this way, we effectively identify product information, expression characteristics, and user feedback across images, news, and text, and combine this with business performance data to support content analysis and strategy optimization, improving user outreach efficiency and business operations. At the same time, we continue to build our insurance domain knowledge base. We have structured core content covering product terms, medical knowledge, service workflows, claims rules, and historical cases into a professional knowledge foundation that underpins our AI application. We also deeply integrated the knowledge base with multimodal models and agent technology, further enhancing the accuracy, interpretability, and business adaptability of AI in complex insurance scenarios, and driving the evolution of insurance services from a traditional manual processing model toward an AI-assisted human machine collaborative model.

Rui Fang, Chairman and Chief Executive Officer, Yuanbao Insurance: 最后，在行业影响力建设与前沿实践上，我们持续以专业研究助力行业发展，以科技创新推动保险服务升级。一方面，我们持续夯实行业影响力，依托深度洞察把握行业结构性机遇。我们联合清华大学五道口金融学院中国保险与养老金融研究中心，发布了《2025年中国互联网保险消费者洞察报告》。报告系统性地追踪了消费者的行为变迁，深入剖析了线上化、智能化及理性化的消费趋势，并且全面梳理了行业演进与AI升级的方向。这不仅为行业高质量发展提供了重要的决策参考，更重要的是，我们将相关的洞察深度纺布在产品的协同与创新服务升级中，进一步巩固了元宝在互联网保险赛道的综合竞争力。

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: Finally, turning to our industry influence and the frontier practices. We continue to support industry development through professional research and drive insurance service upgrades through technology innovation. We also continue to strengthen our industry influence, drawing on deep insights to capture structural opportunities in the industry. in May, together with the Research Center for China Insurance and Pension Finance at Tsinghua University’s PBC School of Finance, we published the 2025 China Internet Insurance Consumer Insights Report. The report systematically tracked shifts in consumer behavior, took an in-depth look at the trends towards online, intelligent, and more rational consumption, and comprehensively examined the direction of industry evolution and AI-driven upgrades. This provided important references for high-quality development across the industry. More importantly, we have channeled these insights deeply into our joint product innovation with insurers in service upgrades, further strengthening our overall competitiveness in internet insurance.

Rui Fang, Chairman and Chief Executive Officer, Yuanbao Insurance: 另一方面，我们将技术优势转化为卓越的运营效能，兑现服务承诺。公司7月发布的2025年理赔半年报显示，智能助赔推动合作保证，实现了万元以下小额赔偿案件的减案时效缩短了41%。同时，我们还推出了理赔最大服务，升级了理赔调解服务，确实做到了以科技提升服务温度，实现了用户体验和运营效率的双重提升。

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: We are also translating our technological advantages into strong operating efficiency and delivering on our service commitments. According to our 2026 first half claims report released in July, intelligent claims assistance helps partner insurance carriers shorten the claim settlement time for a small claim under RMB 10,000 by 41%. At the same time, we introduced our claims follow-up service and upgraded our claims mediation service, bringing greater warmth to our service through technology and achieving a dual improvement in user experience and operating efficiency.

Rui Fang, Chairman and Chief Executive Officer, Yuanbao Insurance: 展望未来，随着"十五五"规划深入推进，多层次医疗保障体系持续完善，以及人工智能加速赋能千行百业，保险行业正迎来科技创新与保障需求升级交汇的新阶段。如何让更多的消费者获得可负担、有质量、有温度的健康保障，既是行业发展的时代命题，也是元宝长期探索的方向。面向未来，元宝将不断夯实AI技术底座，推动智能体、多模态模型等技术在保险全面落地，持续升级用户洞察、产品推荐、用户咨询、理赔协助服务等核心能力。我们也将持续打磨超医保、全守护等普惠产品的矩阵，切实践行让保险买得到、买得起、赔得满意的服务理念。依托稳健经营、技术积累以及对用户需求的深刻理解，元宝将牢牢把握保险行业高质量发展的机遇，推动产业健康险的创新，助力多层次医疗保障体系的建设，为消费者、合作伙伴及股东创造长期价值。

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: Looking ahead, as the 15th Five-Year Plan continues to advance, the multi-tiered health care security system continues to improve, the artificial intelligence rapidly empowers industry across the board. The insurance sector is entering a new phase where technology innovation and rising protection needs converge. How to give more consumers access to health protection that is affordable, high quality, and compassionate is both a defining question for the industry and a direction Yuanbao has long pursued. Going forward, we will continue to strengthen our AI technology foundation, bringing technologies such as AI agents and multimodal models into end-to-end use across our insurance business and upgrading core capabilities, including user insights, product recommendations, user consulting, and claims assistance service. We will also continue to refine our inclusive product matrix, including Super Medical Insurance and Complete Guardian.

Putting into practice our service philosophy of accessible, affordable insurance with high claim satisfaction backed by stable operations, our accumulated technology capabilities, and a deep understanding of user needs. Yuanbao will seize the opportunities presented by the insurance industry’s high-quality development, drive innovation in commercial health insurance, support the development of the multi-tiered healthcare security system, and create long-term value for consumers, partners, and shareholders.

Now I’ll turn the call over to our CFO, Ray Wan, to present our financial results for the second quarter of 2026. Thank you, everyone.

Huirui Wan, Chief Financial Officer, Yuanbao Insurance: Thank you, Ms. Chiffon. Thank you everyone for joining today’s earnings conference call. I’m pleased to share an overview of our second quarter 2026 financial results. All figures below are in RMB, unless noted otherwise. We carried strong momentum into the second quarter, delivering robust growth across our core business lines while continuing to deepen AI integration across our operations. Total revenues for the second quarter reached RMB 1.39 billion, representing a 30.1% year-over-year increase. This growth was primarily driven by strong increases in both our insurance distribution and system service revenues. Breaking down our revenue mix, revenues from insurance distribution services reached RMB 457.4 million, a 30.4% year-over-year increase driven by a continued increase in the number of policies purchased through our platform, supported in part by our enhanced targeting marketing efforts.

System services revenue reached RMB 881.9 million, up 22.8% year-over-year, reflecting continued improvements to our full consumer service cycle engine, which strengthened our ability to deliver more effective marketing, analytics, and customer-related services to our insurance carrier partners, along with expanded system services to both existing and new carrier partners. We also generated RMB 52.8 million in revenue this quarter from advertising services, a new revenue stream we began offering this quarter. The newly provided advertising services, powered by the company’s proprietary intelligent marketing platform, offer customers integrated intelligent marketing and traffic optimization solutions. Turning to expenses, total operating costs and expenses increased by 21.9% year-over-year to RMB 341.3 million. Operations and support expenses were RMB 97.8 million, up 139.1% year-over-year, primarily due to costs associated with our newly launched advertising services. Selling and marketing expenses increased 12.8% year-over-year to RMB 679.3 million, consistent with our ongoing focus on consumer growth and retention.

General administrative expenses were RMB 64.8 million, up 36.3% year-over-year, primarily driven by higher professional service fees and increased personnel-related costs. Research and development expenses increased 21.7% year-over-year to RMB 99.5 million, driven by continued headcount growth in our R&D organization and ongoing investment in technical capability building, which remain key pillars of our positioning as a technology-driven online insurance distributor. Below the operating line, income tax expense for the quarter was RMB 59.9 million, compared with RMB 11.1 million a year ago, primarily driven by a higher effective tax rate during the quarter. Net income for the quarter was RMB 413.2 million, a 35.6% year-over-year increase with a net income margin of 29.7%. Non-GAAP adjusted net income reached RMB 431.2 million, up 32.6% year-over-year, with a non-GAAP adjusted net income margin of 31%. Our cash position grew during the quarter.

As of June 30th, 2026, our cash and cash equivalents, time deposits, restricted cash, and short-term investments totaled RMB 5.16 billion, up 50.9% year-over-year and 8.8% from the end of the first quarter. Net cash provided by operating activities in the quarter was RMB 419.1 million. Before I close, let me provide an update on our shareholder return progress. Under our U.S. $15 million share repurchase program, as of August 31st, 2026, we have repurchased approximately 114 ADS for a total consideration of approximately $1.6 million, reflecting our continued commitment to returning capital to shareholders. To conclude, our second quarter results reflect the durability of our growth model and our ability to scale with discipline. Looking ahead, we will remain focused on high-quality growth, operational efficiency, and a healthy liquidity position, giving us the flexibility to invest in our strategic priorities while continuing to deliver long-term value for our shareholders.

Rui Fang, Chairman and Chief Executive Officer, Yuanbao Insurance: Thank you. I would now like to open the call to Q&A. Operator, please go ahead.

Operator: Thank you management. We will now begin the question and answer session. To ask questions on the phone, please press star one and one and wait for your name to be announced. For the benefit of all participants on today’s call, if you wish to ask your questions to management in Chinese, please immediately repeat your question in English. One moment for our first question. Our first question comes from the line of Amy Chen of Citi. Your line is open. Please go ahead.

Amy Chen, Analyst, Citi: Hi, this is Amy Chen from Citi. Thank you for the opportunity for asking these questions. I have two questions. I will first say them in Chinese and then English. [Foreign language] How do you think of licensed celebrities promoting insurance products via live streaming? Will you adopt similar approaches going forward?

Would this lead to more intense market competition in terms of online distribution of insurance products going forward? [Foreign language] Do you think agentic economy would reshape insurance distribution industry? How do you plan to capture the opportunities related to agentic? Thank you.

Rui Fang, Chairman and Chief Executive Officer, Yuanbao Insurance: 多谢Amy。我先回答您第一个问题。近期监管新规明确了金融产品网络营销必须机构持牌、人员持证。持证名人直播带货，本质上是这一合规框架下利用公众影响力进行客户教育和流量转化的新形态。那我们认为直播只是一个流量入口，而保险销售的核心壁垒在于后端的产品解读与合适的产品匹配。因此，我们着力把流量沉淀到元宝自身的服务体系中，而非依赖外部个人IP。那至于行业竞争，名人入场一定程度上会阶段性地抬高流量曝光的热度，加剧标准化产品的获客成本竞争。但较为严格的监管要求使得单纯依靠粉丝经济变现的空间有限。长期来看，竞争焦点仍将回归到行业深耕程度、数据积累以及生态协同上。我们更看重在这一行业扩散过程中，随着大众通过直播等形式对保险认知度的提升，整个市场的渗透率持续提升，我们能够通过技术和服务的差异化来抢占市场份额。

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: Recent regulations have made clear that online marketing of financial products must be conducted through licensed institutions and by licensed individuals. Licensed celebrity live streaming is essentially a new form of customer education and traffic conversion within this compliance framework. Leveraging public influencers’ reach, we believe that live streaming is merely a traffic entry point. The real barrier to insurance sales lies in back-end product interpretation and matching consumers with the right products. Therefore, we focus on forming traffic into Yuanbao’s own service ecosystem, rather than relying on external personal IP. As for industry competition, celebrity participation may temporarily raise the intensity of traffic exposure and intensify customer acquisition cost competition for standardized products. However, stringent regulatory restrictions have limited how far fan economy monetization can go. Over the long term, competition will continue to center on industry know-how, proprietary data assets, and ecosystem synergies. What matters more to us is that as this industry expands and the public’s awareness of insurance grows through live streaming and other formats, overall market penetration will continue to rise, and we can capture shares through differentiated technology and service.

Rui Fang, Chairman and Chief Executive Officer, Yuanbao Insurance: 好，那第二个关于智能体的问题，我们认为AI agent可能会成为保险销售的新入口。就元宝而言，我们目前主要依托主流互联网平台进行分销。在可预见的未来，这些超级平台仍将是用户市场的绝对占据者，因此现有分销基本盘仍然稳固。当前用户使用AI以信息咨询为主，电商保险等交易转化链路仍然较薄弱，难以形成完整的投保闭环。但从中国互联网保险消费者洞察报告发现，AI智能体凭借其便捷性与大模型技术的持续演进，显著降低了用户获取保险信息的门槛，在咨询体验上带来了实质性的效率提升。对于标准化相对简单的保险咨询，AI的处理能力已可媲美人工，这一点毋庸置疑。但我们也清醒地认识到，面对复杂深度的保障需求与个性化方案设计，当前AI仍可能存在幻觉与准确性边界，技术成熟度尚在演进中。在落地层面，我们正积极将保险垂直智能体接入外部高流量平台生态，参与这一新兴流量市场产业的早期建设。我们承认，当前智能体在保险场景的应用仍处于初级阶段，生态与能力都还在成熟过程中。但我们坚信这是流量入口与用户交互方式的重量迁移，是值得高度关注的新兴趋势和市场。

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: We believe AI agents could become a new entry point for insurance sales. Yuanbao currently distributes primarily through mainstream internet platforms, and for the foreseeable future, these super platforms will remain the dominant holders of user time, so our existing distribution base remains solid. At present, user interactions with general purpose AI are confined to information inquiries. The conversion path for transactions such as e-commerce or insurance purchases remains relatively weak and is not yet sufficient to support a full insurance purchase journey. Even so, our China Internet Insurance Consumer Insights report found that AI agents, through their convenience and the continuous advancement of large language model technologies, have significantly lowered the barrier for users to access insurance information and meaningfully improved efficiency in the consultation experience. For standardized, relatively simple insurance inquiries, there is no question that AI’s capability now rivals those of human agents.

That said, we are also clear-eyed that for complex in-depth coverage needs and personalized plan design, AI may still be subject to hallucinations and accuracy limitations, and the technology is still maturing. On the implementation front, we are actively integrating our insurance-focused vertical AI agent with external high-traffic platform ecosystems, participating in the early-stage development of this emerging traffic arena. We acknowledge that the application of AI agents in insurance scenarios is still at an early stage with both the ecosystem and our capabilities still maturing. At the same time, we firmly believe this represents an important shift in traffic entry points and how users interact, and it is an emerging trend and market that deserves close attention. Thank you. Next question.

Operator: One moment for our next question. The next questions will come from the line of Yue Xu from China Securities. Your line is open. Please go ahead.

Yue Xu, Analyst, China Securities: 感谢管理层的机会。我想主要问两个问题，第一个是关于最近季度我们看到的是主要的互联网平台，它的广告需求还是偏弱吧。我想问一下，这个对我们平台比较低的获客成本或者ROI有没有一些正向的影响？然后短险的趋势有看到一些趋势性的变化，需求有一些趋势性的改善吗？然后第二个问题是海外拓展，因为去年下半年应该是拿了香港的保险经纪牌照，想问一下管理层update一下海外业务拓展的一个更新。Okay.

My first question is regards of the digital ad month opting on major internet platform lately. How is that impacting our customer acquisition ROI? Also, are you seeing any shifts in demand for short-term insurance? My second question regards to overseas business progress. Could management team update on Hong Kong brokerage business since securing license last summer?

Rui Fang, Chairman and Chief Executive Officer, Yuanbao Insurance: 感谢问题。第一个问题是关于近期的广告、广告平台的需求。在存量规模其实不变的情况下，我们是不断在持续优化模型的产品，那ROI可以不断走高，但公司还是在持续扩大投放规模，拓展用户边界，那外部流量竞争会稀释ROI的一定水平。目前我们的ROI持续在较为稳定的水平，尚未看到受到广告需求疲软的一些负面影响。国内短险需求其实仍然是非常庞大，核心在于是否有匹配的保障产品。公司会持续迭代保险保障责任，升级免赔规则，以匹配不同需求分层的用户，持续挖掘增量。

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: If customer scale were held constant, continuous optimization of our models and products would keep driving ROI higher. However, we continue to grow ad spend and ad spend into new user segments, and external traffic competition dilutes ROI to some extent. Currently, our ROI is holding at a fairly stable level, and we have not seen any negative impacts from softer advertising demand yet. The demand base for short-term insurance products in China remains substantial. The key is whether we have coverage products that match that demand. We will continue to iterate on coverage terms and upgrade deductible rules to serve different tiers of user needs and keep unlocking incremental growth.

Rui Fang, Chairman and Chief Executive Officer, Yuanbao Insurance: 关于海外拓展，公司仍在探索不同新业务渠道，也会严格管控新项目的ROI表现，目前没有其他的更新。

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: We continue to explore various new business while strictly managing the ROI performance of new initiatives. Currently, we don’t have any other new update. Thank you. Next question, please.

Operator: The next question. The next question comes from Thomas Wang of Goldman Sachs. Your line is open. Please go ahead.

Thomas Wang, Analyst, Goldman Sachs: Two questions. Thank you for the opportunity. Firstly, on the advertising business, just want to see initial expense is quite high, but want to see what management view on medium to long-term margin. The second point is on the trend in terms of number of policies sold during the quarter and also the average ticket size. Thank you.

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: For the advertising new business, right now, we don’t disclose any details, but right now is on healthy trend. As for the average price of our product, also we don’t disclose any details in our quarterly report, but our momentum continues healthy. Thank you. Next question, please.

Operator: One moment for our next question. Next up, we have the line from Ling Tan from Haitong International. Your line is open. Please ask your question.

Ling Tan, Analyst, Haitong International: I have two questions. Thank you management for taking my question. My first question is regarding the new advertising service revenue. What exactly is the new advertising service revenue disclosing this quarter’s revenue breakdown? My second question is regarding AI. In first half, the company continued to roll out its multi-agent AI claim system and step up investment in AI across claim underwriting and user conversion. What quantify improvement have this AI capability actually delivered in customer acquisition cost, policy, quality and claim cost? What is the CapEx plan for R&D investment going forward? Thank you.

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: Advertising services are a new service offering that was introduced during this quarter, specifically referring to services provided to insurance carriers. Our newly launched advertising services are built on our proprietary intelligent marketing platform, which provides clients with integrated intelligent marketing and traffic optimization solutions. Advertising services represented a small share of total revenue in this quarter. This quarter, in our claims assistance scenarios, we used multimodal models to intelligently parse a variety of materials including medical records, diagnosis certificates, medical invoices, and examination reports, enabling document recognition, information extraction, fact consolidation and review assistance. These capabilities have now been deployed in medical insurance claims assistance scenarios, achieving a documented classification accuracy of 95% and an average key field extraction accuracy of approximately 94%. As of the end of the quarter, our AI team continued to account for over 10% of the total workforce.

Moving forward, we will continue to prioritize deep, consistent investment in our core technology capabilities. Thank you. Next question, please.

Operator: Our next question will come from the line of Xintao Chen of CICC. Your line is open. Please go ahead.

Xintao Chen, Analyst, CICC: 非常感谢管理层给我提问的机会，我有两个问题想请教。第一个问题就是在一季报里面宣布了派息和股份回购的计划，那么请管理层介绍一下2026年和2027年两年派息和回购的政策的指引。第二个问题也是有关AI份额的问题，除了AI去着力提升新用户的转化效率之外，那公司如何利用AI来提升老用户的留存率？So I have two questions.

The first question is, in the first quarter earnings release, you announced a dividend share buyback program. Could you provide some guidance on the dividend and buyback policies for 2026 and 2027? The second question is, besides focusing on improving new customer conversion efficiency, how does Yuanbao leverage AI to enhance the retention of existing customers? Thank you.

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: 感谢兴涛。未来分红比例区间是根据利润情况分析，并由董事会批准。在保持利润稳健增长的情况下，我们将持续致力于为股东创造长期价值。在未来，我们计划维持或提高股东分红水平。那回购方面，目前我们是宣布了为期12个月的$1,500万美元的回购计划，在后期我们也会根据实际回购情况评估是否需要增加或调整回购计划。Our future dividend payout ratio range will need to be assessed based on profitability and approved by the board of directors.

While maintaining robust profit growth, we will remain committed to creating long-term value for our shareholders. Subject to our healthy cash flow and strong profitability, going forward, we plan to maintain or grow shareholder dividends. On the buyback side, we have announced a $50 million share repurchase program over a 12-month period. Moving ahead, we will evaluate whether to extend or adjust the program based on how it is actually executed.

那关于转化率的话，一方面我们运用AI引擎，不仅在用户曝光前进行优化，例如减少转化所需的曝光次数，更重要的是在曝光后，通过对用户行为的深度理解和运营。那另一方面，如本季度提到，公司利用多模态技术协助保司提升理赔处理效率和用户体验，公司也持续建设保险领域专业知识库，形成了支撑AI应用的专业知识基础。我们将技术优势转化为卓越的运营效能，兑现服务承诺，增强消费者体验，从而帮助提升用户留存和复购等。On one hand, we use our AI engine to optimize user conversion and retention directly, both before user exposure, for example, by reducing the number of impressions needed to convert a user, and more importantly, after exposure.

On the other hand, as mentioned, we use multimodal technology to help insurers enhance claims processing efficiency and the overall user experience. We also continue to build out our proprietary insurance knowledge base, forming the professional knowledge foundation that supports our AI applications. By converting our technology advantages into superior operational efficiency, we can better deliver on our service commitments and enhance the consumer experience, which in turn improves user retention and drives repeat repurchase. Next question, please. Thank you.

Operator: Just one moment for our next question. Our next question will come from the line of Jiqi Sun from Shenwan Hongyuan. Please go ahead.

Jiqi Sun, Non-Banking Analyst, Shenwan Hongyuan Securities: 各位领导晚上好，我是来自申万宏源证券的非银分析师孙雨琦，感谢给我这次提问的机会。我有两个问题想请教。第一个问题想追问一下金融产品网络营销管理办法，我们看到这个办法是将在九月末实施，那想请教一下公司在营销合规转型中面临的最大挑战是什么？如何去平滑过渡新规落地之后的转型期？那第二个问题还是想追问一下分红。那么请问在当前现金储备相对充足的背景之下，管理层如何去看待未来分红政策的可持续性？是否会考虑建立与净利润或者自由现金流挂钩的常态化分红机制？

Thanks for the opportunity. This is Jiqi Sun from Shenwan Hongyuan Securities. I have two questions. With the Administrative Measures for the Online Marketing of Financial Products scheduled to take effect in September, what does management see as the greatest challenge in the company’s marketing compliance transition? How do you plan to ensure a smooth transition? The second question is, with the company’s current ample cash reserves, how does the management assess the sustainability of its future dividend policy? Is management considering establishing a regular dividend mechanism tied to net income or free cash flow? Thank you.

Rui Fang, Chairman and Chief Executive Officer, Yuanbao Insurance: 多谢Jackie。这两个问题我来回答吧。第一个是关于金融产品网络营销管理办法。截至目前，该管理办法的出台未对我们的获客模式产生任何实质性的影响。这主要得益于两方面，一是我们一贯坚持合规先行，已搭建起完善的营销行为管理体系，并配套实施强制性合规审查流程。二是我们的核心业务逻辑是与持牌保险公司深度绑定，所有产品条款均严格履行监管审批或备案程序，确保业务合规开展。同时我们长期保持与监管机构的积极沟通，力求公司战略与最新政策导向同频共振。

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: To date, the introduction of this regulation has not had a material impact on our customer acquisition models. This is mainly due to two factors. First, we have always prioritized compliance and have already built a comprehensive marketing management system paired with a mandatory compliance review process. Second, our core business model is deeply tied to licensed insurance carriers, and all of our product terms go through strict regulatory approval or filing procedures to ensure our operations remain compliant. At the same time, we maintain ongoing proactive communication with regulators, striving to keep our corporate strategy closely aligned with the latest policy directions.

Rui Fang, Chairman and Chief Executive Officer, Yuanbao Insurance: 关于分红的政策，刚才也提到，在保持利润稳定增长的情况下，我们将继续致力于为股东创造长期价值。在未来，我们计划维持或提高股东分红水平。

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: While maintaining robust profit growth, we will remain committed to creating long-term value for our shareholders. Subject to our healthy cash flow and strong profitability going forward, we plan to maintain or grow shareholder dividends. Thank you. Next question.

Operator: Please hold for our last question. Our last question comes from the line of Liao Yuan of CITIC Securities. Please go ahead.

Liao Yuan, Analyst, CITIC Securities: 感谢管理层接受我们提问。两个问题。第一个是关于我们的AI。我们之前也上线了基于多agent协同的消费者智能保险咨询规划的一个工具。那我想问，当前这个工具渗透的一个情况，以及对于我们效率带来多少的一个改善？在理赔辅助还有客户质检这些端场景的话，AI agent带来的效率提升有没有数据可以分享？那第二，就是我们看到公司的现金储备也是非常充足的，那同时也是宣告了股东回报计划。那后续的资金的使用计划还有哪些可以跟我们分享的？我自己翻译一下。Thanks management for taking my questions.

I have two questions. The first one is about your AI. Could you share the penetration and attach rate of your multi-agent AI insurance advisor tool and the efficiency gained from AI agent in B2B client support and quality monitoring scenarios? The second question is about your capital allocation. Given the strong cash position in last quarter shareholder return program, could management share more detail about your future capital allocation plan? Thank you.

Rui Fang, Chairman and Chief Executive Officer, Yuanbao Insurance: 感谢。其实关于AI，通过知识库与多模态模型智能体技术结合，公司去进一步提升了AI在复杂保险场景中的准确性、可解释性和业务适配能力，推动保险服务由传统人工处理模式向AI辅助人机协同的模式演进。从长期价值来看，AI辅助或替代，完全替代人工客服理赔协助，可以优化用户的服务体验，拉高用户LTV，自动化建模和开发流程也能很快地加快模型迭代的速度。7月我们发布了2026理赔半年报，显示依托自研的AI辅助理赔系统，通过事件整理、核责、预审及结论解读三大智能体的高效协同，配合智能助赔功能赋能合作险企。我们协助合作保司实现了万元以下小额理赔案件结案时效缩短41%了。同时通过推出理赔追伴、持续升级理赔调解等增值服务，确实做到了以科技提升服务温度，实现了用户体验与运营效率的双重提升。

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: By combining our knowledge base with multimodal models and agent technology, we have further improved AI’s accuracy, interpretability, and business adaptability in complex insurance scenarios, driving the evolution of insurance services from traditional manual processing towards an AI-assisted human machine collaborative model. From a long-term value perspective, using AI to assist or replace manual customer service and claim support can improve the user service experience and raise user LTV. Automating our modeling and development workflows also accelerates the pace of model iteration. According to our 2026 first half claims report we released in July, this was driven by our proprietary AI-assisted claims assistant, which relies on three AI agents working together efficiently for case organization, preliminary liability review, and conclusion interpretation. It works alongside our intelligent claims assistance feature to empower our insurance carrier partners, helping insurance carriers shorten claim settlement time for small claims under 10,000 RMB by 41%.

At the same time, by launching value-added services such as claims follow-ups and continuously upgrading others, such as claims mediation, we brought more warmth to our service through technology, achieving improvements in both user experience and operating efficiency. We intend to maintain a disciplined capital allocation strategy, striking a balance among investments in our existing business, potential new growth opportunities, prudent liquidity management, and shareholder return. Thank you.

Operator: For the questions. That concludes the question and answer session. I would now like to turn the conference back over to management for any additional or closing comments.

Stella Liu, Investor Relations and Strategy Associate Director, Yuanbao Insurance: Thank you once again for joining us today. If you have any further questions, please feel free to contact us directly or our present financial communications. Our contact information for IR in both China and the U.S. can be found in today’s press release. Have a great day. Thank you.

Operator: Today’s conference call, thank you for your participation. You may now disconnect your line.