Uxin (UXIN) Q2 2026 Earnings Call Transcript

Image source: The Motley Fool. DATE Sept. 24, 2026 CALL PARTICIPANTS Founder and Chief Executive Officer - Dai Kun Chief Financial Officer - Feng Lin Investor Relations - Ali Wang TAKEAWAYS Retail Transaction Volume -- 19,610 units, representing an 89% year-over-year increase as the company's superstore model gained market share. Retail Revenue -- RMB 1.08 billion, rising 78% year over year as volume growth offset the impact of declining average selling prices. Average Selling Price -- RMB 55,000, decreasing from RMB 59,000 in the prior-year period due to rapid price adjustments in the new car market. Wholesale Transaction Volume -- 2,289 units, growing 88% year over year as the company cleared inventory from its retail operations. Total Revenue -- RMB 1.51 billion, up 75% year over year, reflecting expanded operations across its superstore network. Gross Margin -- negative 0.7%, down from 5.2% last year because of proactive inventory adjustments to address falling vehicle prices. Adjusted EBITDA Loss -- RMB 120 million, primarily reflecting the temporary gross margin compression during the second quarter. Inventory Turnover -- 20 days, improving from approximately 30 days due to the deployment of AI-driven pricing and risk control systems. Net Promoter Score -- 68, maintaining a high level of customer satisfaction through standardized vehicle reconditioning processes. Q3 Retail Volume Guidance -- 20,500 units to 21,000 units, as management anticipates continued growth significantly above industry levels. Q3 Revenue Guidance -- RMB 1.16 billion to RMB 1.19 billion, reflecting expected stabilization in used car prices and inventory turnover. Q3 Gross Margin Guidance -- above 6%, driven by the completion of earlier inventory resets and improved procurement-to-sales efficiency. NIO Capital Investment -- $4 million, representing the first half of a total $8 million financing round to support business expansion. CEO Share Purchase Plan -- $5 million, scheduled to begin on Sept. 28 to demonstrate management's confidence in long-term company value. Industry Consolidation -- 30,000 dealerships, representing the number of dealers that exited the market in the first half of 2026 due to pressure from new car price wars. Full-Year Industry Exit Forecast -- 50,000 to 60,000 dealerships, which management expects will accelerate market share concentration among scaled retailers. New Passenger Vehicle Sales -- 20% decline, representing the year-over-year contraction in China's new car market during the second quarter. ICE Car Sales -- 40% decline, reflecting the rapid transition toward electric vehicles and resulting price volatility in the internal combustion market. Used Car Market Transaction Volume -- 1.4% decline, indicating that the used car sector remained more resilient than the new car market in the second quarter. Expansion Pipeline -- six superstores, currently under development to broaden the company's warehouse-style retail footprint nationwide. Need a quote from a Motley Fool analyst? Email [[email protected]](fool.com) RISKS CFO Lin stated, "auto prices, particularly prices for new ICE cars, underwent a rapid adjustment over a relatively short period which had a direct impact on the gross margin of our existing inventory," noting that this necessitated proactive inventory sell-through. CEO Dai warned that "risks in the automotive market remain elevated," leading the company to maintain a prudent operating approach regarding capital efficiency and inventory procurement. SUMMARY Uxin Limited(UXIN+19.27%) reported that market volatility in China's automotive sector, specifically the rapid price decline of new internal combustion engine vehicles, influenced used car valuations and margins during the second quarter. Management stated that the company reduced inventory turnover to approximately 20 days by utilizing digital pricing systems and integrated operating platforms. The company indicated that industry consolidation is accelerating, with management forecasting that more than 20% of brick-and-mortar dealerships will exit the market by the end of the year. Management reported that inventory resets are largely complete, with unit profitability expected to recover in the third quarter as the company continues expanding its warehouse-style superstore network. Management stated that the company's pricing accuracy and response time have improved through the deployment of AI-driven technology across key operations. CEO Dai noted that the used car industry is shifting toward a scaled standardized and digitalized retail model as traditional operating models lose ground. The company is currently developing six new warehouse-style superstores and is in discussions with additional cities for further network expansion. CFO Lin indicated that NIO Capital is advancing its overseas direct investment filing process to finalize the remaining $4 million of its committed investment. The company reported that nationwide used car transactions declined 6% in July and 11% in August, suggesting continued market pressure into the third quarter. Management stated that maintaining faster inventory turnover of approximately 20 days is a long-term core operating target intended to reduce price risk exposure. INDUSTRY GLOSSARY ADS: American Depositary Share, a US dollar-denominated equity share of a foreign-based company available for purchase on an American stock exchange. ICE: Internal Combustion Engine, referring to traditional vehicles powered by gasoline or diesel rather than electric batteries. NPS: Net Promoter Score, a market research metric that typically takes the form of a single survey question asking respondents to rate the likelihood that they would recommend a company, product, or service to a friend or colleague. ODI: Overseas Direct Investment, a process where a domestic entity invests in a foreign business, often requiring regulatory filings in jurisdictions like China. Full Conference Call Transcript Operator: Ladies and gentlemen, thank you for standing by, and welcome to Uxin's Earnings Conference Call for the quarter ended June 30, 2026. [Operator Instructions] Today's conference call is being recorded. If you have any objections, you may disconnect at this time. I would now like to turn the call over to your host for today's conference call, Ms. Ali Wang. Please go ahead, Ali. Unknown Executive: Thank you, operator. Hello, everyone. Welcome to Uxin's earnings conference call for the second quarter ended June 30, 2026. On the call with me today, we have D.K., our Founder and CEO; and John Lin, our CFO. D.K. will review business operations and company highlights followed by John, who will discuss financials and guidance. They will both be available to answer your questions during the Q&A session that follows. Before we proceed, I would like to remind you that this call may contain forward-looking statements which are inherently subject to risks and uncertainties that may cause actual results to differ from our current expectations. For detailed discussions of the risks and uncertainties, please refer to our filings with the SEC. Now with that, I'll turn the call over to our CEO, D.K. Please go ahead, sir. Dai Kun: [Interpreted] Hello, everyone, and thank you for joining Uxin's earnings conference call today. It is a pleasure to reconnect with our investors through this call, and we appreciate your continued interest and support. I would like to begin with an overview of our operating performance this quarter and then discuss some of the adjustments we have made in response to changing market conditions. 2026 has become a year of accelerated consolidation for China's automotive industry. The new car market has remained under pressure since the beginning of the year. In the second quarter, new passenger vehicle sales in China declined by more than 20% year-over-year, with internal combustion engine or ICE car sales down ne