Autohome (NYSE:ATHM) released second-quarter financial results and hosted an earnings call on Thursday. Read the complete transcript below.

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Summary

Autohome reported net revenues of 1.2 billion RMB for Q2 2026, with a gross margin of 77.1%, an increase from 71.4% in the same period last year.

The company launched innovative strategic initiatives, including expanding its offline franchise chain Autohome Good Car and a proprietary AI agent product, Cheese Car Butler.

Autohome completed its $200 million share buyback ahead of schedule and announced a new $400 million repurchase plan, reflecting strong confidence in long-term value.

Despite a challenging auto market with declining domestic demand, Autohome's used car export business made strides, completing its first cross-border transaction.

Management highlighted the continued focus on expanding the new retail business and leveraging AI to enhance service offerings and operational efficiency.

Full Transcript

OPERATOR

Ladies and gentlemen, thank you for standing by for Autohome second quarter and interim 2026 earnings conference call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow management's prepared remarks. As a reminder, this conference call is being recorded. If you have any objections, please disconnect at this time. A live and archived webcast of today's call will be available on Autohome's IR website.

It is now my pleasure to introduce your host, Sterling Song, Autohome's IR Director. Mr. Song, please go ahead.

Sterling Song, IR Director

Thank you, operator. Hello everyone, and welcome to Autohome second quarter and interim 2026 earnings conference call. Earlier today, Autohome distributed its earnings release, which can be found on the company's IR website at ir.autohome.com.cn. Joining on today's call is our Chief Financial Officer, Ms. Kuai Zeng. Management will go through the prepared remarks first, which will be followed by a Q&A session where they will be available to answer all your questions.

Before we begin, please note that today's discussion contains forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from our current expectations. Potential risks and uncertainties include, but are not limited to, those outlined in our public filings with the U.S. Securities and Exchange Commission and the Hong Kong Stock Exchange. Autohome undertakes no obligation to update any forward-looking statements except as required under applicable laws. Please also note that Autohome's earnings press release and today's conference call include discussions of certain unaudited non-GAAP financial measures. A reconciliation of the non-GAAP measures to the most directly comparable GAAP measures can be found in our earnings release.

I'll now turn the call over to Autohome's CFO, Ms. Zeng, for opening remarks. Ms. Zeng, please go ahead.

Kuai Zeng, CFO

Thank you, Sterling. Hello everyone. This is Kuai Zeng, Chief Financial Officer of Autohome. Thank you for joining our earnings conference call today. In the second quarter, our innovative business continued to make steady progress, driving Autohome's upgrade towards a comprehensive automotive service ecosystem. For our new retail business, with the authorized dealer model in pilot operation and expanding into more cities, we launched the offline franchise chain brand Autohome Good Car, further expanding our offline service network.

In addition, our global expansion into used car trading is advancing steadily. Our cross-border export platform completed its first transaction in July, providing valuable experience to further expand our service capabilities. We also made major strides in AI, particularly in cutting-edge AI agent technologies. In early July, we unveiled our proprietary intelligent agent product Cheese Car Butler and opened it for public beta. As the automotive industry's first standalone agent product, it represents not only a pioneering exploration of intelligent applications, but also key milestones in enriching our product portfolio and establishing a differentiated competitive edge for us.

Specifically, in the second quarter, we made solid progress across content offerings, product capabilities, and traffic alliances. On content, in May, we launched our annual IP China Intelligent Manufacturing Exploration Plan, jointly created with the News and Publicity Center of the Ministry of Industry and Information Technology. Six episodes will be released throughout the year, covering exciting technological trends including the low-altitude industry, intelligent cockpits, intelligent driving, and embodied AI.

The premiere episode focused on flying cars, combining immersive visits to the front lines of intelligent manufacturing with a fresh, innovative, youth-oriented storytelling perspective to make cutting-edge technologies more relatable and engaging for younger users. This series also marks our first major content initiative following Autohome's brand refresh. After its launch, the program sparked lively discussion on social media, was covered by over 20 leading media outlets, and generated over 70 million views across various platforms.

On the product side, we launched our Intelligent Driving Channel, which systematically profiles the intelligent driving capabilities of nearly 200 mainstream models and provides easy comparisons to help users understand differences across models and choose cars efficiently. In addition, we continue to advance collaboration across our multi-platform, multi-scenario traffic ecosystem. A notable example was our partnership with Alipay in June, under which our Mini Program became the exclusive provider of comprehensive automotive services for Alipay's Auto Live channel, offering differentiated content to match the varied needs of first-time buyers, repeat buyers, and those upgrading their vehicles. According to QuestMobile, in June, our daily active users steadily increased year over year, reaching 76.5 million.

In the new energy vehicle sector. In late April, we launched a pilot online high-purchase model in Shenzhen and Xi'an in partnership with authorized dealers. Under this model, local partners' dealerships posted competitive pricing on the mall, enabling consumers to select a vehicle and place a deposit online and then complete the contract signing and take delivery offline. During this pilot period, over 400 dealers spanned across these two cities offering more than 1,000 models and over 1,000 transactions were completed within 70 days, receiving positive feedback from both our data partners and the users.

Based on the experience gained from the pilot cities in the second quarter, we replicated this model to three additional cities, Suzhou, Jinan and Shijiazhuang, steadily broadening our network coverage in northern and eastern China. At the same time, to address the service gap in low-tier cities, we launched our offline franchise chain brand Autohome Good Car at the end of June with a focus on the underserved low-tier cities. Through precise traffic redirection and standardized operating and management systems and a streamlined resource support system, we help dealerships in low-tier cities achieve stable, scalable growth.

At present, over 100 franchise stores joined Autohome Good Car. Going forward, the Autohome app will remain the core of our online customer acquisition efforts, while offline Autohome Good Car franchisees and authorized dealer stores will handle vehicle delivery through standardized services. We aim to support users throughout the entire vehicle life cycle from vehicle discovery and selection to purchase and ownership. In AI and models. Powered by Autohome's proprietary large language model, we launched Chief Car Butler, our intelligent agent product for the automotive vertical.

The agent leverages our core assets accumulated in the automotive field, including our professional content product database, MCN ecosystem and offline service network to provide users with a broad range of services including multi-dimensional vehicle comparisons, vehicle purchase guidance and maintenance services, etc., establishing a unique, differentiated competitive advantage. Currently, Chief Car Butler is available to users and has entered the feedback collection phase with the initial market response being positive.

In the future, we'll continue to enhance the underlying model capabilities, optimize the product's interactive experience and gradually integrate more offline service resources to steadily improve the product value and service quality. In the used car business, we continue to develop both our core domestic and overseas platforms. For our full-process used car sales service platform, we continue to improve service quality through greater standardization.

Recently, we completed an upgrade and integration of our vehicle inspection system, expanding the number of inspection items from 128 to 265, including 82 newly added assessments specifically designed for new energy vehicles, further improving the accuracy and reliability of our inspection. For our cross-border used car export service platform, we formally obtained the official export qualifications during the second quarter. We also established an online multilingual international website and an offline fulfillment network with business leads spanning over 100 countries.

In early July, we successfully completed the first used car export order on our platform, making a breakthrough from zero to one for our business. In the next phase, we'll focus on three key areas: high-quality vehicle supplies upstream, expanding overseas customer acquisition downstream and improving platform operational efficiency. All of this supports our all-out effort to create a new one-stop channel for used car exports. In summary, since the beginning of the year we achieved meaningful progress across all businesses.

While steadily elevating our businesses, we've consistently delivered on our commitment to shareholder returns. The US$200 million stock buyback program announced in March 2026 was completed ahead of schedule in less than six months. In late July, we announced a new 12-month US$400 million repurchase plan, demonstrating our strong confidence in the company's long-term value. In addition, the RMB500 million cash dividend for the first half of the year was distributed at the end of July.

Looking ahead, we'll continue to deepen our new business development, provide high-quality services to users and partners, and deliver sustainable returns to our shareholders. With that, let me briefly walk you through the key financials for the second quarter of 2026. Please note that I will reference RMB only in my discussion today unless otherwise stated. Net revenues for the second quarter were 1.2 billion. To break it down further, media services revenues were 280 million, lead generation services revenues were 560 million and online marketplace and others revenues were 357 million.

With respect to cost, cost of revenue in the second quarter was 274 million compared with 503 million in the second quarter of 2025. Gross margin in the second quarter was 77.1%, compared with 71.4% in the same period last year. Turning to operating expenses, sales and marketing expenses in the second quarter were 552 million, compared with 630 million in the second quarter of 2025. Product and development expenses were 223 million, compared with 253 million in the second quarter of 2025.

General and administrative expenses were 96 million, compared with 133 million in the same period last year. Overall, we recorded an operating profit of 130 million in the second quarter compared with 297 million in the same period of 2025. Adjusted net income attributable to Autohome was 277 million in the second quarter compared with 476 million in the corresponding period last. Non-GAAP basic and diluted earnings per share in the second quarter were 0.62 and 0.61, respectively, compared with 1.01 for both in the corresponding period of 2025.

Non-GAAP basic and diluted earnings per ADS in the second quarter were both 2.46, compared with 4.06 and 4.04, respectively, in the corresponding period of 2025. As of June 30, 2026, our balance sheet remained robust. Cash, cash equivalents, short-term investments and other long-term investments totaled 19.36 billion. We generated net operating cash flow of 261 million in the second quarter of 2026. On March 5, 2026, our Board of Directors authorized a share repurchase program under which we are permitted to purchase up to $200 million of Autohome ADSs over a period not to exceed 18 months.

As of July 30, 2026, we have completed this share repurchase program ahead of schedule with a total of approximately 10.63 million ADSs repurchased. In addition, on July 28, 2026, our Board of Directors authorized a new share repurchase program under which we may repurchase up to $400 million of Autohome ADSs over the next 12 months. As of August 14, 2026, we had repurchased approximately 1.9 million ADSs for a total cost of approximately 43.0 million.

That concludes our financial summary. Now we are ready to open up the Q&A session. Operator, please.

OPERATOR

Thank you. As a reminder, if you'd like to ask a question, you can press star 11 and wait for your name to be announced. Your first question comes from the line of Thomas John of Jefferies. Your line is now open.

Kuai Zeng, CFO

Thank you for your question. I will answer your question. You know, since the beginning of this year, the overall retail sales in the auto market has remained under pressure. In the first seven months, domestic retail sales of passenger vehicles declined by 20% year over year, while the domestic new vehicle sales fell by 2022% year over year in Q2. Even the new energy vehicle, which had previously been the primary growth driver, already saw a sales decline of 8% in Q2 year over year for consecutive periods.

And the traditional ICEs, that is internal combustion engine vehicles, performed even worse, with sales declining 38% year over year in Q2. At the same time, the auto industry profitability has deteriorated. In the first half of the year, the profits for the auto manufacturing industry declined by 20% year over year, with the profit margin expansion at just 3.8%, which is a historical low. The market expectations for the overall industry sales at the beginning of the year were optimistic, but now this expectation has been revised downward.

The China Passenger Car Association, CPCA, now forecasts that the full year for 2026 passenger vehicle retail sales will decline by 16% year over year, bringing the overall total annual sales to fewer than 20 million units. This means that the overall China auto market will continue to face quite a lot of pressure in the second half this year. And we expect the auto industry to be characterized by a combination of weak domestic demand, structural differentiation, and exports providing support.

From the industry level, we can see the new energy transition is accelerating and auto exports are becoming a new growth driver. So for the China auto market, it has now entered into an existing market stage with weak domestic demand becoming a major problem, a major constraint on growth. At the same time, you can see the penetration rate for NEV continues to pick up. In April the penetration rate was 60%, and now in July it climbed further to a new high of 65%.

In contrast to the weak domestic demand, auto exports have maintained strong growth momentum. During the first seven months, 2026 passenger vehicle exports increased by 74% year over year, with NEV accounting for more than half of the total export volumes. With weak domestic demand and strong overseas growth simultaneously, auto exports have become a key engine for automakers to offset weak domestic demand and drive profit growth. From the market level, we can see increasing structural differentiation, and consumers increasingly are in a wait-and-see mode.

Currently the market is experiencing clear structural differentiation across segments by price range. The auto market is diverging at both ends. The entry-level market for vehicles priced below RMB 50,000 has contracted sharply, declining 55% year over year in the first half. On the other side, sales of high-end NEVs priced above RMB 400,000 surged 46%, demonstrating greater market resilience. Overall, the sales of traditional ICE and low-end NEVs continue to decline, while the middle- to high-end EVs have emerged as a growth segment.

So in summary, the auto market in the first half of this year can be characterized as cold domestically, hot overseas: domestic demand weakens year over year, while NEV penetration continues to increase, and auto exports became the primary growth driver for the overall industry. As China’s auto market enters an existing market competition stage, only those companies who can capture consumers’ needs throughout their entire life cycle and provide value-added services across the entire customer journey will be best positioned for future development in the transforming period.

This is also one of the key areas we will continue to focus on and explore going forward. However, for the second question about the used car export, the used car export market is sufficiently fragmented with a sufficiently large and diverse supply of used vehicles. This is favorable for us to build our long-term competitive advantage and sustainable barriers to entry. And if the market was more highly concentrated, it would be more difficult for platform companies.

And for our advantages in this area, first is the strong brand from Autohome. We are the leading auto vertical media platform, so we have strong brand recognition and credibility, and also we are newly listed. This also helps us in our branding. Second is the stable used car vehicle supply and a standardized system. We have access to a stable and compliant supply of used cars, supported by a standardized, industry-leading vehicle inspection system which can enable comprehensive assessments of the vehicle condition.

Overseas buyers value accurate, complete, and comprehensive vehicle inspection reports, as well as maintenance and insurance claim records. Autohome can provide all of this, giving overseas buyers greater confidence in their purchase process. Third is the digital one-stop service. We leverage our online digital tools to improve operational efficiency, including 24/7 customer support, dynamic matching of the vehicle supply, and multilingual website services, etc. All these capabilities facilitate more effective communications between buyers and sellers. For our business progress update on the used car export, in the second quarter we officially obtained the government qualification for the used car export, and we successfully completed the first used car export transaction on our platform. This represents an important zero-to-one breakthrough for this business segment. For the work ahead of us, on one hand, we will expand our high-quality used car vehicle sourcing.

On the other hand, we will focus on expanding our overseas customer base. At the same time, we will continue to optimize our used car export service platform and improve overall operation efficiency, with the goal to build a one-stop new channel for used car exports. The next question please, operator. Thank you.

OPERATOR

The next question comes from the line of Zhang Xiaotan of CICC. Please go ahead.

Zhang Xiaotan, Analyst at CICC

Thanks, management, for taking my questions. First of all, the company has recently taken proactive steps on shareholder returns. How do you view the sustainability of the shareholder return program going forward and over the medium to the long term, how will you balance the cash reserves as well as the shareholder returns? And secondly, regarding the new retail business, what is the company's current strategic positioning for this segment? Thank you.

Kuai Zeng, CFO

Thank you for your question. Autohome has always placed a strong emphasis on shareholder return and long-term market value management. To further enhance our shareholder return mechanism and improve investment value, we have established a dual-track return framework combining a regular cash dividend policy with share repurchases, making our shareholder return policy more transparent and predictable. For the share repurchase, as we just mentioned, the US$200 million share buyback program was completed ahead of schedule at the end of July.

And on July 28th the company announced a new US$400 million share repurchase program, and as of last week, approximately 10% of this buyback program has been completed. Going forward, we will continue to actively execute this buyback program in the open market in accordance with our established strategy. For the cash dividend, in March the company announced the RMB 500 million cash dividend for the first half of this year, and this was successfully distributed to all our shareholders by the end of July.

Also this year we will continue to execute our commitment to pay at least RMB 1.5 billion in cash dividends for the full year. For our long-term capabilities, Autohome has a healthy balance sheet, ample cash reserves, and stable business operations. This gives us the capacity to deliver sustainable, stable, and long-term returns to all shareholders. In the future, we will continue to improve operation efficiency and strengthen the resilience of our business, ensuring we can fulfill our commitments to all the shareholders.

For the new retail business, it is an important strategic initiative for Autohome as we build our transaction ecosystem and address gaps in our offline service capabilities. For online, we are leveraging the Autohome app to build an automotive transaction service platform, Autohome more. For offline, we leverage Offline Car Purchase and Autohome Good Car to expand the offline service network, connecting online demand with offline service fulfillment.

In the online-to-offline scenarios we are leveraging our AI technologies to provide end-to-end support, including vehicle selection through our AI Car Selection Assistant and purchase support through AI price inquiry, etc. Going forward, we are planning to expand AI-enabled services into the vehicle ownership stage. In terms of our new retail business update and progress, the implementation has been moving at a relatively rapid speed. For Online Car Purchase, it began its pilot program in late April and has now expanded to five cities: Xi'an, Shenzhen, Suzhou, Jinan, and Shijiazhuang, primarily targeting high-tier cities.

For Autohome Good Car, it opened up its franchise program in late June and now has more than 100 franchise stores, with a primary focus on low-tier markets. Ultimately our goal is to become a comprehensive automotive service ecosystem that delivers value throughout the entire auto life cycle from car discovery to car selection to purchasing, owning, and eventually replacing.

OPERATOR

Thank you. Next question. Our next question comes from Richie Sen of HSBC. Please go ahead.

Richie Sen, Analyst at HSBC

Thank you, management, for taking my questions. I want to ask management about how you feel the recovery timing as well as the drivers behind the auto market, and especially for the media services, how would you view the trend in the second half of this year?

Kuai Zeng, CFO

Thank you. Regarding the drivers for the auto industry recovery, you know, we just mentioned the auto market sales for the whole year are expected to decline about 16% year over year. This has been downsized; however, it doesn't mean there are not any growth opportunities in the market. For example, vehicle scrappage and replacement will still contribute more new vehicle purchasing demand. And we just mentioned that sales of the high-end NEVs priced over RMB 400,000 increased 46% year over year.

So in our opinion, a sustainable stabilization and recovery of the auto market still depend on improvement in the broader macroeconomic environment and strengthening of consumer confidence. And exports—auto exports—are another important growth opportunity. In the first half of this year, the passenger vehicle (PV) exports increased by more than 70% year over year and the AEV exports surged 124%. And for NEVs, they accounted for over 50% of the total passenger vehicle export.

So it represents new opportunities in the auto market. Regarding the media business in the second half of this year, as you know, there is always a saying: Golden September and Silver October. And besides, there will be multiple new vehicle launches in the market. So in our opinion, we believe the market will show a kind of recovery in the second half of this year. Operator, the next question, please.

OPERATOR

We will go to the next question. The next question comes from the line of Brian Gong of Citi. Please go ahead.

Brian Gong, Analyst at Citi

Thanks, management, for taking my question. Given the pressure over auto dealers, how does management think about outlook for our sales leads business?

Kuai Zeng, CFO

Thank you. For the leads—you know, the lead generation—performance is highly related with the overall sales volume in the market. In Q2, the market, the sales of autos, decreased, so that is the main reason for the lead generation segment. On one hand, dealers continue to face significant operating pressures in the market. Many of them failed to meet their sales target for the first half of this year. According to statistics from the China Automobile Dealers Association (CADA), 77% of dealerships achieved less than 90% of their first-half sales targets.

Many of those dealers responded with more losses and with high volumes of inventories. That's why we believe, as we just mentioned, the sales volumes for new cars still face pressure and will decrease for the second half of this year. Now, AI. We still see some opportunities in the market. On one hand, we are increasing our traffic and upgrading our products to improve the quantity and quality of the lead and lay a solid foundation for the renewal of our dealership products—for example, the Cheshang Hui—for the second half of this year and next year as well.

I’ll give you some examples. We are using our AI technology: AI live streaming. We are leveraging AI technology to empower dealers’ new media live streaming operations so we can help them reduce costs and improve their efficiency, increase their operational efficiency, and help them enhance their conversion capabilities. Also, we have smart stores so we can upgrade the intelligent guided tour function. When users browse a dealer's online store, AI-generated voice commentary can match the content on the screen and it can be played automatically.

It can help create an immersive watch-and-listen experience, helping to increase the number of users who will submit and leave their contact information. We expect through those product and service upgrades and technologies we can build a solid foundation for the renewal of our products next year. Operator.

OPERATOR

No further question at this time. I will turn the call back over to management for closing remarks.

Sterling Song, IR Director

Thank you very much everyone for joining us today. We look forward to speaking with you all again on our next quarter's conference call and to sharing the latest updates on the company's corporate strategy and business development. Should you have any further questions or suggestions, please feel free to contact us at any time. Thank you everyone. Goodbye. Thank you, operator.

OPERATOR

That does conclude today's conference call. Thank you for your participation. You may now disconnect.

Disclaimer: This transcript is provided for informational purposes only. While we strive for accuracy, there may be errors or omissions in this automated transcription. For official company statements and financial information, please refer to the company's SEC filings and official press releases. Corporate participants' and analysts' statements reflect their views as of the date of this call and are subject to change without notice.