WeRide posts 144% revenue growth in Q3 2025, driven by global expansion and driverless operations in key markets.

Hello, can you hear me? Good morning and good evening ladies and gentlemen. Thank you for standing by. Welcome to WeRide's third quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. The Company will be hosting a question and answer session after Management prepared remarks. Please note that today's event is being recorded. The Company's unaudited financial and operating results were released by the Newswire earlier today and are currently available online. Joining us today are WeRide's founder, chairman and CEO Dr. Tony Hannah and CFO and head of international Ms. Jennifer Lee. Before we continue, I would like to refer you to the Safe harbor statement in the Company's earnings press release which also applies to this call as today's call will include forward looking statements including WeRide strategies and future plans. These forward looking statements are made under the safe harbor provisions of the U.S. private Securities Dedication Reform act of 1995. Forward looking statements involve inherent risks and uncertainties. The Company's actual results could differ naturally from those stated or implied by these forward looking statements as a result of various important factors. And please refer to risk factors sections of the company's Form 20F filed with the SEC and announcements on the website of the Hong Kong Stock Exchange for the full disclosure of these three sectors. The Company does not assume any obligations to update any forward looking statements except as required under applicable law. Please note that all numbers stated in Management Prepared Remarks are in RMB terms and we will discuss non IFRS measures today which are more truly explained and reconcile to the most comparable measures reported in the Company's earnings release and filings with the SEC and the Hong Kong Stock Exchange. With that, I will now turn the call over to the Company's founder, chairman and CEO, Dr. Don Mi Han. Please go ahead Sir. Thank you. Hello everyone. Thank you for joining us today. I would like to begin by highlighting some of the key milestones we achieved this past quarter. Q3 was a period of extraordinary progress for WeRide. Most notably, we made history in Abu Dhabi by securing the world's first city level fully driverless taxi commercial permit outside the United States. And we will begin. Actually, we have already started the driverless operations through Uber, which I'm going to detail in the later slides. This week, with our recent expansion into Belgium and our inaugural driverless robotaxi license in Switzerland, WeRide has become the only company with autonomous driving permits for eight countries. By October, we have developed L4 fleets in 11 countries and more than 30 cities with over 1600 L4 level autonomous driving vehicles in operation worldwide. Now let's take a look at our third quarter accomplishments. So. Let's turn into Abu Dhabi achievements. Okay, next slide please. Though as mentioned earlier, WeRide has been officially approved to provide fully driverless commercial robo taxi service in the UAE's capital of Derby. This landmark authorization removes the requirements for in car safety officer and demonstrates the regulators strong confidence in our technology. Following this approval we ride and Uber launched the region's first fully driverless ride-sharing Robotaxi service this week. Starting from Yas island and with a citywide rollout underway. And next page. Our commercial operation at Abu Dhabi has begun in last December. Our service now covers roughly 50% of the city's core area. In half of 12 hours our single vehicle can complete up to 20 trips per day. I think this is quite exciting progress in the third midterm. In the midterm we aim to extend our service hours to 24, 7, increase vehicle utilization to more than 25 trips per day and improve human to vehicle ratio to 1 to 10. These numbers will lead us to a very healthy unit economics. We believe Abu Dhabi will set a global benchmark for large scale and commercially viable robo taxi operation. And with all of these numbers, I think our unit economics is very very healthy and can be profitable. So I just want to emphasize, you know, this kind of breakthrough is quite exciting and we work so hard for a whole year to achieve this full driverless robo taxi operation in Abu Dhabi. And this is the first city level outside of United States who are capable, you know, of first city level robo taxi service out of United States and it is actually provided through Uber platform. So with all of these important factors this is unparalleled and we are so excited that we are making history. Now let's talk about our current operation in Dubai. In September we secured a self driving vehicle trial permit from Dubai's Roads and Transport Authority and have begun road testing for our driverless operation in Dubai. Our goal is to launch supervised trial on Uber this year and the driverless commercial operation in the year of 2026. I mean next year we are going to provide driverless Robotax service in Dubai. Next page please. Then we are going to talk our current operation in Saudi Arabia in Riyadh. We began offering robo taxi rides through Uber in October, making our robo taxi service first and only publicly accessible robo taxi service in the kingdom. With our development in the three largest cities in Middle East, that is Riyadh, Abu Dhabi and Dubai, we have more than 100 robotaxi vehicles in the Middle East region. The launch of driverless operation Abu Dhabi is paving the way to scale the fleet to more than 500 vehicles by next year and two tens of thousands by 2030. So we are very excited and very confident and very prone to and very confident and very optimistic about our full driver's global tax operation in Middle East. But that's not only our operation region. And I want to talk about East Asia and Europe first. In Singapore, together with Grab, we received approval from the Land Transport Authority for both Robo taxi and the Robo bus in the area called Punggol District. We plan to increase our AV test volume by four times by the end of this year. We also integrating our technology into Grab speed management and the routing system so that in future we can provide driverless Robo taxi through GRAB in Singapore just what we have done in Abu Dhabi through Uber. Actually, all of these efforts will pay the groundwork for commercial service in the next phase. And then let's talk about Switzerland. In Europe, the expansion in Switzerland continues to lead our Robo taxi deployment. We received the country's first driverless Robo taxi license enabling our autonomous operation in the virtual region. A full driverless public service is expected to be launched in the first half of 2026. That is our current operation in Europe and in East Asia, in Singapore. And now let's talk about China. In our China market, we continue to expand and innovate as we scale our commercial fleets. We also launched a 247 driverless commercial service in Huangpu district at Guangzhou. This is an area of 150 square kilometers. As of October, we have deployed more than 300 robotaxis in Guangzhou and over 100 in Beijing. For all of these service, you can hail a driverless Robo taxi in this region through our WeRideGo app. User value is kept very close to our heart and we recently introduced China's first free pickup and drop off feature for Robo taxi service we call PUDO service, allowing our system to intelligently recommend optimal boarding locations. This greatly improved both operational flexibility and user experience, which is well captured by our operational data. In November, each Robo taxi completed up to 25 day trips in Guangzhou and the 23 in Beijing, which is clear evidence of accelerated adoption. And then you know this our current exciting program about robotaxi. Next let's talk about our other applications. First, Robobus. Okay, next page. Our Robobus obtained Belgium's first level four test permit and we launched our operation in Leuven making Belgium the 11th country covered by our service in Guangzhou. After serving more than 1 million passengers since 2021, we received an offer received an order for another for an additional 100 mid sized robo buses. This is a very exciting achievement. Actually this is a newly developed robo bus. In Hong Kong we established a partnership with Guangzhou Bus holding to deploy more than 500 Level 4 vehicles over the next three years. And for our L2 level ADA system, WeRide and Bosch achieved a major milestone in November with the start of production of WePilot 3.0. This is an end to end system. It's just like what Tesla has achieved through their FSD system. Our V pilot is totally comparable to what Tesla can do with FSD. The Vpilot 3.0 will debut with the refreshed Cherry XCeed ES and ET model and existing owners will receive OTA upgrades. With this kind of new feature. Every owner of Cherry Xceed ES&ET can enjoy the experience of Tesla's FSD with this exceptional end to end system. WePilot has also been selected as the major add assistant provider by Guangzhou Automatic Group GAC for several of their passenger car models. So that part is actually a very exciting progress demonstrating wewride are not only capable of doing L4 level robo taxi but also capable of doing L2 level add ons for a massive production car. And this page actually shows summarize our footprint in the global actually vwrite strategy prioritize a balanced development in the global market. I want to explain this slide a little bit. You can see in these 11 countries we have different levels of operation we have tested or we can operate it with normal driver. So they are showing in the legend. So you see our multi product offering has maximized the value of our strategy making us the only company whose technology is available in the 11 countries shown here. So we actually have a wide spectrum of applications and service available for the global market. Next let me discuss about the backbone of our technology. This is called vrun1universal platform. Starting from supporting our four applications alone in early days, WeRideOne has grown graduates gradually grow into a more powerful platform that empowers the full spectrum from L2 to L4 while continuously breeding new tools and systems. So one of the most preeminent is our world model. WeRide Genesis. So in our Genesys model you can see Genesis is a new platform and will allow autonomous vehicles to be tested in a digital twin of the real world, safely, efficiently and at a large scale. It features the data loop algorithm Loop and the simulation validation loop that are essential for scalable autonomy. This is our world model and it seamlessly integrated with our end to end system. So this is a unique technology advantage. Our world model can be seamlessly integrated into end to end of system. And our L4 system can leverage on the data we collected from our L2 level data. So this gene genesis form as the core fly wheel actually we call it a double flywheel. We can actually leverage on L2 level massive production car data to improve our robotaxi. In turn, our robo taxi data with redundancy can help us to boost the performance of our other system. I want to emphasize in this world there's only one company Wewright can do. So you know we on one hand side we have a large scale robo tax fleet make. Wewright are capable of doing leading global taxi service like Waymo and other companies like they can do in the US So that we can actually capture all the characteristics of full driverless operation. At the same time we write supply v point 3.0 and very advanced ADA system comparable to the FSD of Tesla. And we can leverage on the mass production car data and collect all this kind of data in a very broad sense in all kinds of scenario to help us to improve the performance of robo taxi. We believe we can combine the benefit of L4 and L2, this hybrid architecture enhance adaptability, reliability, safety and transparency, ultimately enabling robust commercial deployment. We look forward to sharing more about this advantage soon. In summary, Q3 was a culture of exceptional execution. We expand our global leadership and we translated technology innovation into commercial reality. With that, I will hand the call over to our CFO Jennifer to discuss our financial performance. Jennifer, please go ahead to discuss about the financial numbers.

Thank you, Tony. Hello everyone. Before we dive into the third quarter financials, I want to highlight that all figures are in RMB and comparisons are year over year unless otherwise stated. Now let's discuss our third quarter financial performance. We deliver a total revenUAE of 171 million with a year over year growth of 144% driven by our continUAEd fleet expansion and increasing service penetration. The revenUAE growth also reflects a significant milestone we have achieved during this quarter supported by our advanced technology, robust deployment and operational capabilities. Our revenUAE came from both product revenUAE and service revenUAE. Product revenUAE delivered strong growth of 428% to 79 million in this quarter. An encouraging result driven by the increased sale of our robo taxi and Robo buses. Service revenUAE growth 67% to 92 million in Q3 supported by an increase of 29 million from Intelligent Data Service and an increase of 8 million in autonomous driving related operational and technical services Service revenUAE has surpassed product revenUAE in this quarter demonstrating a continual growth momentum and healthy business structure among our product lines. What really stood out in Q3 same as in the last two quarter was our robotaxi businesses. Robotaxi revenUAE increased 761% year over year to 35 million in Q3 accounting for 21% of total revenUAE in this quarter. With our new federal permits in uae, we are the first and only robotaxi company that have begun fully driverless robotaxi operation in uae. Removing in car safety officer is a critical milestone from a financial perspective which will enable our Robo taxi service to achieve unit economic breakeven. The quality of our growth is also compelling. Group level gross profit increased 1,124% to $56 million for the third quarter with a group level gross margin of 33% demonstrating our industry leading gross margin. As our business continUAE to grow, we aim to keep delivering business valUAE along with our business were globalization drastically. Operating expense decreased 51% to 436 million with R&D expense accounting for 73% of the total operating expenses. To break down further, R and D expense increased by 24% to 316 million in the third quarter of 2025 compared to the same period of 2024. Excluding share based compensation, R&D expense grew 39% to $288 million as we further strengthened our global data compliance and advanced R and D efforts for our pre installed robotaxi. The increase in R and D expense was primarily dUAE to an increase of 31 million in service fee for R and D projects, an increase of $21 million in personnel related expense from headcount increase and an increase of $23 million in mature and depreciation and amortization expenses. Administrative expense decreased by 84% to 100 million in the third quarter of 2025 compared to the same period in 2024. Excluding share based compensation, administrative expense increased by 23% to 74 million. The increase was primarily dUAE to an increase of 6 million in professional service fee mainly related to legal compliance service and an increase of 4 million in personnel costs as we build necessary supporting function to grow our business. Selling expenses increased 23% to 19 million in the third quarter of 2025 compared to the same period of 2024. Excluding share based compensation, selling expense increased by 36% to 19 million which was well below the sales Increase Our commitment to R and D is the backbone of our strategy. We will continUAE to direct our resource there to pioneer the industry innovation and keep building our competitive advantage. Alongside this, we will strategically grow our global team with a clear focus on region that has an accelerating adoption of L4 solutions. This ensures that we have a world class talent needed to support our business expansion. Our net loss narrowed by 71% to 300 to 307 million in the third quarter of 2025. On a non IFRS basis, adjusted net loss increased 15% to 276 million largely dUAE to an ongoing R and D investment and broader operational support required for the expansion of our business. As of 9-30-2025, we had 4.5 billion in cash and cash equivalent and time deposit, 926 million in investment in wealth management product and 18 million in restricted cash. We had short term bank borrowing of 245 million. Our current liquidity reserve along with the proceed from our recent Hong Kong dUAE primary listing in November have enabled us with a resilient position for our R and D focused strategy and our globalization deployment progress. Our fully driverless Robotaxi commercial permit in Abu Dhabi is not just a local milestone. It's a scalable blUAEprint for the global industry. It demonstrates a viable path for city level fully driverless operation outside the U.S. along with the potential for profitable unit economic and major international market. Our strategy is to scale this model globally. We have the complete package, the technology, the operational experience, a proven safety record and regulatory trust. In the next five years we will achieve large scale L4 deployment creating a sustainable business and delivering tremendous valUAE of autonomous driving to the shareholders. With that operator, we are now ready to take on some qUAEstions. Thank you.

We will now begin the question and answer session. To ask the questions on the phone, please press star 11 and wait for a name to be announced. One moment for the first question. The first question comes from the line of Tim SEO from Morgan Stanley. Please go ahead sir. Hi Tony and Jennifer. Thanks for taking my question. This is Tim from Morgan Stanley. Congratulations on the strong result and continuous expansion and Robotech separation globally. I have two questions. The first question we noticed that we officially started commercial deployment of driverless Robotech in Abu Dhabi, uae. So in addition to the volume optifies to revise fleet cells as Tony just mentioned, how should we quantify the revenue opportunities of a vehicle sales, revenue charge and profit sharing in the long run? That's my first question.

Okay, thank you Tim. That's a great question. I'll take the first one. So for the benefit of all listeners, I'd like to briefly elaborate on our robotics business model. In domestic China we mainly own and operate vehicles by ourselves and on our own ride healing platform Virego. So before after the UE gets to break even point in the next few years in China, we will gradually engage third party asset owner and the vehicle ownership to them. And for now we pretty much own like all the vehicles by ourselves. And international market is different. From day one we collaborated with platform partners such like Uber, Grab, sbb, TXAI and we generate revenue from three main streams. Three streams. The first one is revenue share from the ride fare and second one is the annual licensing. And third is the sale of the vehicle. So vehicle sale is considered as the product revenue vray can scale up the robotaxic fleet much quicker. And in a lighter business model like asset on an asset basis. Since the Robotax operations lead doesn't sit on our own balance sheet, we usually just sell this to our partner already. And revenue sharing and annual licensing of the recurring service revenue over the whole lifespan of the vehicle, which tend to be five to seven years. In particular revenue share will become a significant multiplier following the expansion of the fleet size. We'll take Middle east as example. A robotaxi at a human level utilization which means they can complete like 25 orders per day can generate an annual like revenue of over US$90,000 like on the platform. If we take 30% of the revenue share, that will give us US$30,000 per car per year as service as revenue share. If we can take 70% of the revenue share, that will give us like US$60000 per car per year. So if we are moving this step one step closer to the goal to see what we have already like say in Abu Dhabi. Right now we have a significant presence this near Henry Robotaxi in Abu Dhabi. Now we already cover 50% of the city core area. And the commercial model is we integrate on platform like Uber. Right now we are charging at the same price level at UberX and Uber Comfort. In fact, if you get on the Uber and to call the robot just to call normal red hailing car in half of the city. No matter you pick Uber app, Uber Comfort or autonomous option, you can all get a WeRide vehicle. And this demonstrates that our service is competitive with the mainstream. Like red hailing from day one on the pricing level. And unit economic is on the unique economic side. The most critical metric is utilization. Right now we already achieve a daily average like 12 order per vehicle in a 12 hour shift. Sometimes we can get to on the good days we can get to more than 20 orders per vehicle per day for the 12 hour shift and it's already indicating a strong user preference and stickiness. So for 12 for the information for 12 orders per vehicle per day we can already get to the breakeven threshold in this market. So there's huge profitability potential. Based on our current driverless cost structure and plan to extend the hours to 24 hours next year we project an average daily order can reach to 25 per vehicle per day and this level of utilization will lead to a very strong profitability potential next year. So while the specific percentage of revenue share as confidential between different partners. But this approach can empower a sustainable Win win partnership for everyone in the ecosystem. Thank you. Thank you so much for sharing all the details. My second question is also related to rewrite's global business. So looking forward, in addition to operations in Abu Dhabi and Switzerland which we just announced, which markets could step up as a key volume driver to rewrite and does rewrite need to accelerate R and D and the selling expanding more aggressively into next year 2026 to finance the company's robust expansion in overseas? That's my second question. Thank you. Okay, I'll take the question. And so first of all I think so besides Optavian Switzerland, you know which markets would step up as key volume driver. So to us in our plan is like. So first of all in the Mid east we have two major cities in UAE Dubai and Abu Dhabi currently is already we have already got the permit and we are doing extensive road testing. And UAE is definitely one country we pay a lot of attention to. It's a very important market. And there's also Saudi Arabia so you can see major countries in south and Mideast so they are part of potential countries. And although Europe and other developed countries in Asia like Japan, Singapore and Korea, they are all potential markets can help us to drive the volume up. But one thing I want to point out is like Kritim, you just asked a very good question. That is it's also I have been thinking about this over the years all the time. That is what are our target markets and which markets can we make our service and products very profitable. And I think through our tested through our operation in Abu Dhabi we find something so called Abu Dhabi model. Together with Uber we found the unique economics is good and give us a very promising projection that we will soon in this region we can make a good very profitable service. This update model actually created a roadmap for other cities. So with Uber and I think we will try to copy this kind of model to the similar cities. And also this is a good combination of our current technology, our strategy and also our collaboration with our strategic partnership. So with this model I think we tend to copy to Singapore by forming another alliance with grab, our also very important strategic partner to doing in Singapore and also potentially all East Asia and and in China we are focusing on developing a normal taxing service based on our own application. And about expansion, although we are increasing R and D investment to build stronger technology platforms and we also try hard to recruit top talents. But we expect our growth of related expenditure to be moderate because you know, we want to adopt a satellite model to strike a balance between scaling and investment. One of our very mid term goal is trying to reach the profitability at the same time maintain a strong market share. And also we still want to innovate. So we have to strike a balance between investment expenditure and the development. But with our current progress, I think I'm very optimistic because I have already seen the success of the Abu Dhabi model and what's next to do is trying to find all the places we can easily copy the Abu Dhabi model to. And by gathering all the strengths from these potential markets, we want to achieve profitable profitability in the near future. Thank you so much Tony for sharing that great insight and congratulations Tim and looking forward to more exciting project breakthrough from around the world. Thank you. Thank you for the excellent question, Tim. Thank you for the question. The next question will come from Alex Yao from JP Morgan. Please go ahead. Hello and good evening management team. Thank you for taking my question. I have two questions. Number one, what is your take of the Robotaxi business in China? How do you envision economics to change in the future for China and for international market respectively? The second question is how quickly can the driverless milestone of of that the operation be replicated in other markets? What can we expect for your fleet expansion plan globally and what are the catalysts or hurdles for your plan? Thank you. Okay, let me try to answer these questions one by one. Although it's claimed to be two questions, I believe it's two groups of questions. So first question, if I remember clearly, it's roughly about what you think about China market and what's our plan for China market and our thought on the economics of China market. So first of all, I have spoken a lot about the global market, Mideast Asian market, Mideast Asian market, East Asian market, European market, and but what about China? Okay, China, you know, our headquarters located in China. China is definitely a major market. And we also, you know, definitely China is one of the most important market we are targeted at. Okay, now let me elaborate about the pros and cons to put resources in China market and what our strategy is. So first of all, China is a unique market with the largest user base and the dynamic nomics. And also it is a great test ground. It has been both our technology proving ground and ideal operation, our sandbox for our very innovative ideas. But of course that doesn't mean like we treat them as a lab. Okay, we want to why we do the robotaxi operation or trial operation. We keep safety as our top priority. But still, you know, with all kinds of scenario, all kinds of different climate, different weather conditions. China is a vast country. And we actually, we tested so many different methods, different algorithms. So that part actually China is unique and a very big market. But we believe, but you know, China is also very, in terms of development, it's not that balanced. You know, they have a tier one city, looks like Paris and New York. There's a tier four city, looks like, you know, like rural area. So we believe profitability in tier one cities can be achieved with a combination of three elements. Number one, city level drivers per meet. Number two, average daily order of high double digits. That means like what we try to achieve in Mid east should be achieved in China also, you know, more than 20 orders per day. Number three, a kind of relatively healthy price. Okay. Although these days the taxi fire in China is still relatively low, but we expect to see the fare to grow a little bit. So is still kind of relative healthy. So with these three factors, we believe we still need to expand our market in China, mainly in tier one cities. So far we have achieved like as I mentioned before, right? 300 robotaxis in Guangdong and another 100 robotax, more than 100 robotaxis in Beijing in the areas of 150 km area. And we are continuing to expand that. And also we, we have implemented free to do, I mean pick up and drop off features help us to improve the user experience. And I think we aim at supply better robo taxi service than the traditional taxi service supplied by human driver. Therefore we can get more orders and also we can give better user experience so that we can, we can be ordered more frequently. And we expect that economics of all of these markets will help to improve over time. And also we want to actually learn what we have in China to expand to and learn what we have learned in China and use them as our competitive advantage in a global market. Therefore, I think we still treat China as one of the most important market and we will keep on invest and inject resource in this market. Okay, the second group question is about how quickly we can copy Abdab model to the rest of the world. Okay, first of all, thanks for asking this question Annie. And we believe we have find this kind of Abu Dhabi model. It's kind of like a Matthew effect. And weWrite is kind of a unique first mover because we just got a city level driverless permit. It is the only one so far out of the United States that you can have a city wide driverless permit and you can provide this service through Uber. So that means make the service more ubiquitously available. Therefore I think we can quickly copy to some similar market like Dubai in uae, same country, Riyadh in Saudi and same region and Singapore with a grab support. So we are trying to copy to these kind of countries and I believe the regulatory condition all of other factors are quite similar. And we also want to emphasize Europe is very important market and we are trying to see whether we can copy to Europe and about the catalyst and hurdles. Catalyst is actually because of this massive effect, other countries are more prone to allow our operation are more prone to give us permit. But at the same time the hurdles is still the regulatory. We want to make sure we use our leverage on our current successful experience to get more driverless permit so that we can deploy the service. That's all I wanted to say about this question. Thank you for the questions. One moment for the next question. Next question comes from Ming Sun Lee of Bank of America. Your line is now open. Hello, dear management team, I have two questions as well. So first question. We are seeing more OEMs and ride hailing companies announcing to plan enter the robotaxi business. What are Vrai's key advantages and how should we think about the competitive landscapes in the future? I think that's my first question. Okay, so I think you know, these days because of, because of the increasing discussion and the increasing maturity of Robo Taxi, you see so many car OEMs and platforms, car getting platforms start to talk about robo Taxi or start to announce their robo taxi strategy. But one thing I want to mention is like you know, Robo taxi to durable taxi is not easy, okay? It takes many years of efforts, technology accumulation, regulatory exploration. And that's why there are so few mature robo taxi company in this world. You know, if you come from a mature robotaxi service one standard they have open to public driverless robo taxi operation. I think you know, you can contact most 1 or 3 or 4. Okay, so not for many. So it's not because of. When you see a few companies getting matured, then you can announce your strategy better. You need to show whether you have enough technology accumulation, enough experience to do robo taxi. But our vwise competitive advantage is still in several areas. First of all, technology, our ability to massively deploy both L4 and L2 level mass production vehicle help us to actually first of all gain data, to gather data more efficiently and make our algorithm more generalizable so that one actually in turn strength our technology. Second, our output, our capability actually for fast iteration is there. And you know, think about for car OEMs, right? They have, they have a relatively small ADA system developer team. You know what you can do for L2 plus plus FSD or L2 ADA system is far from what you can achieve in L4. Because L4 is a driverless operation. L2 is just like assistant driving system. For the L2 system you don't need to take the final responsibility. But for L4 system you have to be redundant, have to take the responsibility. Over the past nine years, VWine has to accumulate loss of experience. That's why we can roll out taxi service. And I haven't seen any other car EMS or car heavy platform be able to do so. So that is one of our advantage. And one thing the last thing I want to emphasize is about the core of a company. The core freewrite is really the AI technology. Wewride since day one has been an AI company and we hire so many top tenants and set up our company for the fast iteration in the AI algorithm. I don't think traditional car OEMs or traditional car heating platform are capable of this kind of faster iteration. So let's wait and see. But so far I haven't seen any major car OEMs or car heaving platform company have successfully rolled out any robo taxi service, driverless robo taxi service to public. Okay, that's my answer to these two questions. Sorry, one more question from me. So following the last question, do you think the amount of data and the development of AI models have given OEMs certain age to enter and to compete in robotics? Is it, is it possible to evolve from L2 to L4? Oh, very good question. So first of all I want us to think about one thing. So who are the best L2 or other system company in this world? Probably Tesla in China. I think we can name a few. Maybe Xpeng, Li Auto but if you look at their strategy, they are doing L2 ADA system and they talk about robotaxi but when they come to Robo taxi they always try to attack this problem or approach this project directly from L4 level. Why there is no L3 strategy? Okay, where are there L3 strategy? There's no L3 strategy from Tesla, there's no XCOM and Li Auto. They all skipped at L3. Why is that? Because you know if you directly grow L2 to L3 and then to L4 they found it's really very very difficult. It's just like you know you are climbing a cliff Instead you may be directly, directly solved the problem that is using what your experience direct solve L4 L4 system level problem. That is just like we have already done for past eight or nine years the technology has been there. We have used deep learning algorithm based on large language model lots of data but all of this I want to say it's based on our past 8 years experience currently true Carl Em can leverage on the cutting edge large language model stuff but there are lots of infrastructures that are relevant like data simulation and the cloud computing platform. All of this I don't think the cloud ems have enough accumulation still take many years of them to really roll out a simulation platform to roll out the protocol, to roll out the pipeline to test the driver robo taxi. One thing I want to emphasize having a pretty good ADAS system can let you drive for 100 miles without takeover. It's far from to roll out a driverless robo taxi. To roll out a driverless robo taxi you have to capable of making that car drive by itself more than 10,000 miles. So that is kind of magnitude of difficulties. So. So it's just like swimming in a swimming pool and then you want to swim and then across the English Channel that's that different. So I think I'm not going to say it's absolutely not possible to gradually grow from L2 to L4 but it will take a long long time before than that. I think first class the tier one Robotaxicon like we read will have already taken over the global market has already been very profitable. So time left for this major car OEMs to gradually grow from L2 to L4 is very very limited. Any other questions? Thank you for the questions. We will now take the next question from Li Ping Zhao from cicc. Your line is now open.

Good evening Tony and Jennifer. Thanks for taking my questions. So first I want to follow the previous technical question and this question is for Tony. Because you are quite confident in maintaining the leadership in the industry. What tools and technology approaches help you stay ahead of the curve? Could you please share more color from a technical perspective and then I'll have a follow up.

Okay, so first of all, just as I have discussed, right? There's only one quantity in the world to my best knowledge that are capable of doing robo taxi have already achieved open to public driverless operation. At the same time supply ADA system to mass production car company. That's weride. And so we have a so called dual flywheel strategy. That is we can gather the data we collected through our robo taxi fleet, all kinds of corner cases and use that to facilitate our ELF2 development. At the same time we can also get what we have collected from L2 system like AI drive based on navigation and make our L4 system more stable and more generalizable. And so by combining these two source of data, two source of problem, we actually gradually evolve to a super platform that are capable of robo taxi at the same time with limited hardware and limited HD map or navigation map make us to cover the whole global market. So these two parts actually leverage on each other help us to improve or to iterate. Our algorithm at a speed cannot be achieved by a single strategy company. So that's one of our advantage. And the other thing is like the globalization. Since we have deployed the fleets in the global market, we can collect the data and also we can get heterogeneous source of data from all over the world. We can have the data that collected in a very dry climate in Mideast. And sometimes you can get data from very humid tropical tropical area in Singapore and very cold area in Japan and in China. And I can't imagine any other company have this kind of wide spectrum of application area. And with all of this data and also we hired a group of talented engineers, we actually evolve very fast. The other thing I want to emphasize is our Genesys platform, it's actually based on physical AI model and with lots of considerations on a really world model, physical AI or physical AI world. And it actually seamlessly integrates with our end to end system. This kind of simulation platform give us a big advantage to develop. And with combination all of this kind of algorithm and data, I think this massive effective here. We have many, many driverless permits in all over the world, in many countries and we have many car OEMs collaborating with us. We have heterogeneous data collected from different country, different level of autonomy. And by combining all of this, I think we can achieve accelerated development speed which is much much faster than our competitors. That's my answer to your question.

Thanks Tony, that's very helpful. And my second question is for Jennifer. The board of the company has authorized 1 million USD share repurchase program in May this year. And could you please update what is the status on this program? Thank you. Thank you. Li ping. Regarding the 100 million US dollar share repurchase program which is authorized by the board in May, we haven't no purchase has been initiated to date. The reason is the pre prioritary work for our Hong Kong IPO constituted for a closed period under the security regulation during which the trading was restricted as a due listed company. We are also required to obtain specific shareholder approval to ratify this program. We are currently preparing the call extraordinary general meeting to seek with approval which will allow the program to proceed. Thank you. Thank you, Jennifer. All right, operator, we're ready to take the next question.

Certainly. Our last question comes from Paul Gong from Goldman Sachs, please. So I beg your pardon from ubs. Please go ahead. Thanks for taking my question. Yes, Paul Gong from ubs. I have two questions. The first one is regarding the Robotaxi revenue contribution. We have noticed that while this is about seven times year over year growth, it seems to have a little bit fluctuation compared to the second quarter. Could you please elaborate more on this? And my second question is regarding the European strategy congratulates for the permit in Switzerland recently. Can you share more on the next step of the company's plan for European expansion? Thank you.

Okay, I'll take the first question. I think Tony probably want to take the second. So regarding the fluctuation of global tax revenue, we we will say for the past three quarters. You can see our Robotaxi revenue made like a 22% contribution in first quarter. 36% and 21% revenue contribution for the past two quarters which already showcased a very continuous momentum. The fluctuation was expected given that our delivery schedule is in tandem with the permit upgrade and the corresponding expansion of our operating area. We made a significant step forward by securing the city level driverless operation permit in Abu Dhabi which will pave the way for accelerating expansion in the entire Middle east going forward. Thank you. Tony, you want to take the second one?

Yes, I will take the second one. Okay, the second question is about our. Actually our. Since we have already got the driverless robo taxi permitting in Switzerland. And what's our next step for Europe? Okay. So European market is a great market for robo taxi. I think the taxi fire in Europe is high and also European, most of the countries in European market, they are short of labor. And that is actually very, very good scenario or opportunity for robo taxi company to deploy robo taxi service to fill the gap between the shortage of driver and increasing demand for taxi. You know, these days we know the numbers that people, you know, especially after the coronavirus, you know, if possible, people like to take a kind of private transportation if possible. So I think there's an actual growing demand for taxi. So if we can deploy robotaxi as a very cost effective method, people will love this kind of product. So since in Switzerland we have already got it and now we are considering some other countries, like we establish an office in Stuttgart and also try to explore in, in Paris. So in the next 12 months we will solidify our foundation actually with our trial operation in France, in Belgium, and also our current operation in Switzerland and talk to all the possible countries. And we also form a strategic partnership with Uber, with Renault, with sbb, stl, et cetera. And there are a lot of airport in European countries talking to us to explore the possibility of our robobus. So we want to use all of our applications like robobus, Robo sweeper to actually help us to explore the possibility to extend to certain countries. Because in certain European countries they will like to tend to adopt robo bus or robo sweeper first and then try to do robo taxi. And gradually we want to go to Switzerland, Belgium, Germany, France, Spain and Norway, you know, these kind of countries to extend to more countries. And then, you know, of course I want to emphasize our approach is dynamic. It all depends on the availability of strong local partner and also depends on regulatory policy and the local weather, shortage of the neighbors. All of these factors we have to, we have to consider. But for sure we will gradually expand to the aforementioned countries and all other potential countries in Europe. Thank you so much, Very helpful. Thank you. If there are no further questions, I'll conclude the call today. Thank you for your participation in today's conference. This does conclude the program. You may now disconnect. Thank you very much. Thank you. Bye. Sa.