小牛電動 (NIU) 2022 Q3 法說會逐字稿

Good day, and thank you for standing by. Welcome to Niu Technologies Third Quarter 2022 Earnings Release Conference Call. (Operator Instructions) Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Ms. Wendy Zhou, Senior IR Manager. Thank you. Please go ahead.

美好的一天，謝謝你的支持。歡迎來到小牛科技 2022 年第三季度收益發布電話會議。 （操作員說明）請注意，今天的會議正在錄製中。我現在想把會議交給今天的第一位發言人，高級 IR 經理 Wendy Zhou 女士。謝謝你。請繼續。

Thank you, operator. Hello, everyone. Welcome to today's conference call to discuss Niu Technologies results for the third quarter 2022. The earnings press release, corporate presentation and financial spreadsheets have been posted on our Investor Relations website. This call is being webcast from the company's IR website as well, and a replay of the call will be available soon.

謝謝你，運營商。大家好。歡迎參加今天的電話會議，討論 Niu Technologies 2022 年第三季度的業績。收益新聞稿、公司介紹和財務電子表格已發佈在我們的投資者關係網站上。該電話會議也在公司的 IR 網站上進行網絡直播，很快就會重播電話會議。

Please note 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. Forward-looking statements involve risks, uncertainties, assumptions and other factors. The company's actual results may be materially differ from those expressed today. Further information regarding the risk factors is included in the company's public filings with the Securities and Exchange Commission.

請注意，今天的討論將包含根據 1995 年美國私人證券訴訟改革法案的安全港條款作出的前瞻性陳述。前瞻性陳述涉及風險、不確定性、假設和其他因素。公司的實際結果可能與今天公佈的結果存在重大差異。有關風險因素的更多信息包含在公司向美國證券交易委員會提交的公開文件中。

The company does not assume any obligation to update any forward-looking statements, except as required by law. Our earnings press release and this call include discussions of certain non-GAAP financial measures. The press release contains a definition of non-GAAP financial measures and a reconciliation of GAAP to non-GAAP financial results. On the call with me today are our CEO, Dr. Yan Li; and CFO, Ms. Fion Zhou. Now let me turn the call over to Yan.

公司不承擔任何更新任何前瞻性陳述的義務，除非法律要求。我們的收益新聞稿和本次電話會議包括對某些非 GAAP 財務措施的討論。新聞稿包含非 GAAP 財務指標的定義以及 GAAP 與非 GAAP 財務結果的調節。今天與我通電話的是我們的首席執行官嚴力博士；和首席財務官，Fion Zhou 女士。現在讓我把電話轉給嚴。

Thanks, Wendy, and thanks, everyone, for joining us on the call today. In Q3 2022, our business faced challenges from risk from rising raw material prices, market demand fluctuations and aftermath of the COVID resurgence in China. All those factors brought serious disruptions to our operations. During this quarter, we delivered a mixed result in China and international markets. Total sales volume was down by 19.2% year-over-year. Total sales volume in the international market reached nearly 58,000 units attributed to the growth in the kick-scooter category, bringing the biggest year-over-year (inaudible) in the sales in the new overseas market.

謝謝溫迪，也謝謝大家今天加入我們的電話會議。 2022 年第三季度，我們的業務面臨原材料價格上漲、市場需求波動以及中國 COVID 捲土重來的風險帶來的挑戰。所有這些因素都對我們的運營造成了嚴重干擾。本季度，我們在中國和國際市場取得了喜憂參半的業績。總銷量同比下降19.2%。由於滑板車類別的增長，國際市場的總銷量達到近 58,000 台，在新的海外市場帶來了最大的同比銷量（聽不清）。

In China market, we experienced a decrease in sales. Sales volume in China market was 263,000 units, down by 32.9% year-over-year. Now I'll go over to challenges and opportunities in each market in detail. First, for the China market in Q3 2022, we continue to experience difficulties due to the impact of the high lithium battery cost, the sporadic COVID lockdowns and the delay of new product rollouts. The raw material price for the lithium-ion battery has a sharp increase since the beginning of the year, the increase had slowdown the penetration rate of lithium-ion battery electric scooters across the entire China market.

在中國市場，我們的銷售額有所下降。中國市場銷量為26.3萬輛，同比下降32.9%。現在我將詳細介紹每個市場的挑戰和機遇。首先，對於 2022 年第三季度的中國市場，由於鋰電池成本高、零星的 COVID 鎖定和新產品推出延遲的影響，我們繼續遇到困難。鋰離子電池原材料價格自年初以來大幅上漲，漲幅減緩了鋰離子電池電動滑板車在整個中國市場的滲透率。

We observe demand in Tier 2 and Tier 3 cities that asset-based scooter percentage increase in the market as the price gap between the lithium and acid batteries widen. This has impacted us significantly since the majority of our e-scooters are lithium-ion battery based, especially in our entry-level products, which accounted for over 90% of the volume loss year-over-year.

我們觀察到二三線城市的需求，隨著鋰電池和酸性電池之間的價格差距擴大，基於資產的踏板車在市場上的比例增加。這對我們產生了重大影響，因為我們的大多數電動滑板車都是基於鋰離子電池的，尤其是在我們的入門級產品中，占同比銷量損失的 90% 以上。

We just also actively optimize the product portfolio to reduce the entry level percentage as under the new lithium-ion cost, those product lines produced part gross margins. The replacement height of the replacing old standard scooters with new national standard scooters has also declined Q2 and Q3 for our targeted market of Tier 1, top Tier 2 cities. For example, the overall market of Beijing declined by 60% of most of the replacements were completed last year. Given our sales are still more concentrated in the top-tier cities, our sales volume was also impacted this year.

我們還積極優化產品組合以降低入門級百分比，因為在新的鋰離子成本下，這些產品線產生了部分毛利率。我們的目標市場一、二線城市，新國標代步車更換舊標代步車的更換高度也在二季度和三季度有所下降。例如，北京整體市場下降了60%，大部分置換是去年完成的。由於我們的銷售仍然更集中在一線城市，我們今年的銷量也受到了影響。

Last, but not least, our main products rollout has been significantly delayed this year, partially due to the COVID resurgence lockdowns in Shanghai and vicinities where our R&D center is based. Although the high-end product like SQi was released in August, they won't be able to ship until December. And our new U+, our high-end Gova series like G6T and B2 were shared in late August or early September.

最後但並非最不重要的一點是，我們今年的主要產品推出已大大推遲，部分原因是上海和我們研發中心所在的附近地區的 COVID 復甦封鎖。像SQi這樣的高端產品雖然在8月份就發布了，但是要到12月份才能出貨。而我們新的U+，我們的高端Gova系列，比如G6T和B2，是在8月底或9月初分享的。

Those core products this year we launched have missed the key sales seasons has provided not enough fuel for the 2022 sales. Now despite the sales volume drop and delay in the new product rollout, the newly rolled out product received overwhelming positive responses from the media and the consumers. This helped to restrengthen our brand as the high-end lifestyle brand in China, but also lay out a strong foundation for 2023.

今年我們推出的那些核心產品已經錯過了關鍵的銷售旺季，沒有為2022年的銷售提供足夠的燃料。現在雖然銷量下降，新品上市時間推遲，但新推出的產品卻得到了媒體和消費者的熱烈反響。這有助於重新鞏固我們作為中國高端生活方式品牌的品牌地位，同時也為 2023 年奠定了堅實的基礎。

First, we pre-released the revolutionary SQi e-bicycle in August priced at RMB 8,999 to RMB 9,599 which I have briefly talked about in my last quarter's earnings call. With this innovative look and customed aerospace mechanism material, the evolution of SQi was well received by the market. We received more than 15,000 preorders for the pre-release.

首先，我們在 8 月預發布了革命性的 SQi 電動自行車，價格為 8,999 元至 9,599 元人民幣，我在上一季度的財報電話會議上簡要談到了這一點。憑藉這種創新的外觀和定制的航天機製材料，SQi 的演變受到了市場的歡迎。我們收到了超過 15,000 個預發布訂單。

Another high-end product we launched around the same time is our new U+. The new U+ has inherited a classic design for over time, most popular U series, but designed with improved light designs, smart controls and riding economics and additional personalization functionality. The new U+ has nearly 50,000 shipments within the first 30 days of its rollout. During the Double 11 shopping festival, our new U+ has ranked #1 seller products in the electric scooter category by Tova. Together with SQi, those new products helped Niu to #1 in the transportation category on top of. With the record-breaking sales of SQi and the new U+, we reconsolidate our position to lead in the premium electric 2-wheeler market in China.

我們大約在同一時間推出的另一款高端產品是我們的新 U+。新的 U+ 繼承了隨著時間的推移最受歡迎的 U 系列的經典設計，但設計有改進的燈光設計、智能控制和騎行經濟性以及額外的個性化功能。新的 U+ 在推出後的前 30 天內出貨量接近 50,000 件。雙十一期間，我們的新品U+在Tova的電動滑板車類目中排名第一。與 SQi 一起，這些新產品幫助 Niu 在運輸類別中排名第一。憑藉 SQi 和新款 U+ 創紀錄的銷量，我們再次鞏固了在中國高端電動兩輪車市場的領先地位。

Now along with the launch of the new product, we initiated market events via PR, social media marketing, PR collaborations of off-line product launches and user events. The marketing campaign around the new product launch has gained a total of 1.4 billion views across all platforms 3x of the view we had a similar campaign in 2021. Those marketing activities again strengthen our brand messages as a lifestyle brand China, urban mobility industry.

現在隨著新產品的發布，我們通過公關、社交媒體營銷、線下產品發布和用戶活動的公關合作來發起市場活動。圍繞新產品發布的營銷活動在所有平台上的總瀏覽量達到 14 億，是我們在 2021 年開展類似活動的瀏覽量的 3 倍。這些營銷活動再次強化了我們作為中國城市交通行業生活方式品牌的品牌信息。

Now amid the lithium price increase, we took a step to optimize our product portfolio towards the premium to high-end product to improve our gross margin as well as the restrengthen our brand as a premium brand in China. For the first 3 quarters, our premium new series product percentage continued to increase from 31% to 39%, while our entry-level 0 series product reduced from 28% to 15%. During Double 11 shopping festival online, 83% of our e-scooter orders came from product over RMB 5,000. So despite the rise in raw material costs, we managed to improve our gross margin in China significantly by 300 basis points.

現在，在鋰價上漲的情況下，我們採取措施優化我們的產品組合，向高端產品邁進，以提高我們的毛利率，並重新鞏固我們作為中國高端品牌的品牌。前三個季度，我們的高端新系列產品佔比從 31% 繼續增加到 39%，而我們的入門級 0 系列產品佔比從 28% 下降到 15%。在雙十一期間，我們83%的電動滑板車訂單來自5000元以上的產品。因此，儘管原材料成本上漲，我們還是設法將在中國的毛利率顯著提高了 300 個基點。

Now coming to the international market, we faced challenges in the electric 2-wheeler market from the temporary shutdown of the sharing market demand as well as the macroeconomic headwinds in the rising euro and U.S. dollar exchange rate and increased lithium prices. First, the market for the sharing electric motorcycles has temporary shutdown this year as the sharing operators has not raised additional capital for expansion, but merely focused on current CapEx deployment. The sharing sales accounted for 1/3 of our sales in the international market last year. So this year, we experienced 0 sales from that.

現在來到國際市場，我們在電動兩輪車市場面臨來自共享市場需求暫時關閉以及歐元和美元匯率上漲以及鋰價上漲的宏觀經濟逆風的挑戰。首先，共享電單車市場今年暫時停擺，因為共享運營商沒有籌集額外資金進行擴張，而只是專注於當前的資本支出部署。去年，共享銷售額占我們國際市場銷售額的1/3。所以今年，我們的銷售額為 0。

Now the right second, the right in the lithium prices, coupled with the weak euro forced us also to increase the prices in the European market, which impacts our sales of electric motorcycles in the segment. So at the end, the total sales of electric motorcycles in Q3 in overseas market were down by 34% year-over-year. However, during this quarter, we had a significant 166.5% year-over-year growth in the sales of Southeast Asia market, mainly from the growth of Indonesia and Thailand market. During the G20 Summit in Bali, Niu provided the electric scooter to be used by the Indonesian National Police officials to support the local government's effort of green transportation. We have continued effort in expanding the Southeast Asia market as we hope to grow with the trend of transition from traditional gas-filled 2-wheelers to electric 2-wheelers as it happens.

現在恰逢其時，鋰價格合適，再加上歐元疲軟，迫使我們也提高了歐洲市場的價格，這影響了我們在該領域的電動摩托車銷售。所以到最後，Q3海外市場電動摩托車總銷量同比下降了34%。然而，在本季度，我們在東南亞市場的銷售額同比增長了 166.5%，主要來自印度尼西亞和泰國市場的增長。在巴厘島G20峰會期間，小牛為印尼國家警察提供了電動滑板車，支持當地政府的綠色交通。我們一直在努力拓展東南亞市場，因為我們希望隨著從傳統的充氣兩輪車到電動兩輪車的過渡趨勢而增長。

We have also started exploring battery swapping solutions to aid adoption of electric motorcycles with the first trial in Singapore. Contrary to the decline of the electric motorcycle market, we experienced a tremendous growth in the micro mobility market. For the kick-scooter category, we had a significant quarter in growth of sales from kick-scooter category during -- of this half season for the electric motorcycles.

我們還開始探索電池交換解決方案，以幫助採用電動摩托車，並在新加坡進行了首次試驗。與電動摩托車市場的下滑相反，我們在微型機動車市場經歷了巨大的增長。對於滑板車類別，在電動摩托車的這半個賽季中，滑板車類別的銷售額有一個顯著的季度增長。

The sales of kick scooters [rocket] to 55,000 units during Q3 growth of 162% quarter-over-quarter. Since Q4 2021, we have strategically rolled out our kick-scooter product to cover a wide range of market needs. The first launched K3 and K2 are proven to be successful in the market. During the Amazon Summer Prime Day sales in July, these 2 kick-scooter models were ranked #1, #2 on Amazon Best sellers in the kick-scooter category in French, Spanish and Italian market. The kick-scooter products gain not only popularity among customers, but also recognition from the industry. Our K3 MAX received outstanding coverage from U.S. big tech media, including Tom's Guide and TechRadar. It was ranked #1 of the best overall electric scooter by Tom's Guide and awarded a perfect scooter by TechRadar. The K3 Pro model was also awarded a second place for the best sustainable mobility device by (inaudible) a Spanish top medium in their annual awards.

第三季度滑板車的銷量 [火箭] 達到 55,000 台，環比增長 162%。自 2021 年第四季度以來，我們戰略性地推出了滑板車產品，以滿足廣泛的市場需求。最早推出的K3和K2在市場上被證明是成功的。在 7 月的亞馬遜夏季 Prime Day 促銷期間，這兩款滑板車分別在法國、西班牙和意大利市場的滑板車類亞馬遜暢銷商品中排名第一、第二。滑板車產品不僅受到客戶的歡迎，也得到了行業的認可。我們的 K3 MAX 獲得了美國大型科技媒體的出色報導，包括 Tom's Guide 和 TechRadar。它被 Tom's Guide 評為最佳整體電動滑板車第一名，並被 TechRadar 評為完美滑板車。 K3 Pro 型號還在西班牙頂級媒體（聽不清）的年度獎項中獲得了最佳可持續移動設備的第二名。

Now during Q3, we continue to expand our product offerings. We launched our K1 kick-scooter and [KU's] to add kick-scooter product portfolio. K1 is entry-level kick-scooter product where KU's is the kick-scooter for 6- to 14-year-old. With those 2 product added, we now have a complete product offerings with price range from RMB 300 to RMB 900, covering both children and adult kick-scooter products. Also along with the kick-scooter product, we also pre-launched our first e-bike product, [C3] recently. It's a 2 lightweight swappable batteries offering a long drive range of 62 miles.

現在在第三季度，我們繼續擴大我們的產品供應。我們推出了 K1 滑板車和 [KU's] 以增加滑板車產品組合。 K1 是入門級滑板車產品，而 KU's 是適合 6 至 14 歲兒童的滑板車。加上這兩款產品，我們現在擁有完整的產品系列，價格從人民幣 300 元到人民幣 900 元不等，涵蓋兒童和成人滑板車產品。除了滑板車產品，我們最近還預發布了我們的第一款電動自行車產品 [C3]。這是一個 2 塊輕型可更換電池，可提供 62 英里的長續航里程。

Now besides the product launches, we have also built our sales channel for our new micro mobility products. Through a focused effort, we have achieved a solid presence on online channels, building not only sales, but also brand image and brand awareness through our shops (inaudible) markets. Meanwhile, riding the momentum from the recognition we gained from our online shops, we started to expand our off-line sales point by working with retail store like Best Buy and Media Mart. But end of Q3, our kick scooter was sold in more than 750 retail shops across Europe and North America, and we expect to grow this number to over 3,000 by next year.

現在除了產品發布之外，我們還為我們的新微型移動產品建立了銷售渠道。通過專注的努力，我們在在線渠道上取得了穩固的地位，不僅建立了銷售，還通過我們的商店（聽不清）市場建立了品牌形象和品牌知名度。與此同時，憑藉我們從網上商店獲得的認可，我們開始通過與 Best Buy 和 Media Mart 等零售商店合作來擴大我們的線下銷售點。但在第三季度末，我們的滑板車在歐洲和北美的 750 多家零售店銷售，我們預計到明年這一數字將增加到 3,000 多家。

Now along with the expansion of growth of product portfolio and sales channel is our effort in PR and marketing. In 2022, we published over 700 articles to cover our product plus all media platforms. The PR articles that has gained more than 100 million views until our marketing to support coming Black Friday sales, we collaborate with influencers with big fan bases to create content featuring our product. Those content generate a total over 2 million views on YouTube and TikTok.

現在隨著產品組合和銷售渠道增長的擴大，我們在公關和營銷方面做出了努力。 2022 年，我們發表了 700 多篇文章，涵蓋我們的產品和所有媒體平台。公關文章的瀏覽量已超過 1 億，直到我們進行營銷以支持即將到來的黑色星期五銷售，我們與擁有大量粉絲群的影響者合作，創建以我們的產品為特色的內容。這些內容在 YouTube 和 TikTok 上的瀏覽量總計超過 200 萬次。

I believe the expansion of our product portfolio, developing sales channels and exposures from PR marketing activities, our micro mobility category has a much larger potential in bringing exponential growth in 2023.

我相信，隨著我們產品組合的擴展、銷售渠道的開發和公關營銷活動的曝光，我們的微移動類別在 2023 年實現指數增長的潛力要大得多。

Now for Q4, we remain a cautious outlook. In China market, the fourth quarter has always been a low quarter in terms of market demand. Now on top of the demand, the impact of the price increases will be continuous. In addition, the sporadic COVID resurgence also add additional uncertainty to our key markets. Now in the overseas market, we haven't seen a bounce back in the electric 2-wheeler sales for the sharing business and the increased price will continue to exist and have an impact on our sales on electric motorcycles.

現在對於第四季度，我們仍然持謹慎態度。在中國市場，第四季度一直是市場需求低迷的一個季度。現在除了需求之外，價格上漲的影響將是持續的。此外，零星的 COVID 復甦也給我們的主要市場增加了額外的不確定性。現在在海外市場，我們還沒有看到共享業務的電動兩輪車銷售出現反彈，價格上漲將繼續存在，並對我們的電動摩托車銷售產生影響。

We saw a positive trend in the international kick-scooter market, but since Q4 is traditionally a low quarter, we expect a moderate growth from that category. So overall, 2022 has been a tough year for our business in operations as we face headwinds from raw material price increase and the macroeconomic uncertainties bringing negative impact to our financials. In the face of mounting challenges, however, we made quite a few crucial operational adjustment and lay out a strong foundation for a promising 2023.

我們看到了國際滑板車市場的積極趨勢，但由於第四季度傳統上是一個低迷的季度，我們預計該類別將出現適度增長。因此，總體而言，2022 年對我們的運營業務來說是艱難的一年，因為我們面臨原材料價格上漲和宏觀經濟不確定性給我們的財務帶來負面影響的不利因素。然而，面對越來越多的挑戰，我們進行了一些關鍵的運營調整，並為充滿希望的 2023 年奠定了堅實的基礎。

Now since the formation of the company Niu has the ambition to become a global mobility solution provider and a well-recognized lifestyle brand in urban mobility, leveraged our design strength and technology innovation capability. We created a smart lithium-ion scooter category in China was able to quickly establish our brand name in the electric motorcycles globally. Now facing the recent market shift, we focused on increasing R&D effort on our premium new series and high quality Gova series as opposed to low-end entry-level product this year. The 2 premium products, SQi and U+, have received overwhelming positive feedback and proven to lift our brands in just 3 months of debut. The SQi was recognized as a revolutionary first of its kind by the media with the innovation in material technology and design.

自公司成立以來，小牛立志成為全球移動解決方案提供商和城市移動領域公認的生活方式品牌，利用我們的設計實力和技術創新能力。我們在中國創建了一個智能鋰離子踏板車類別，能夠迅速在全球電動摩托車中樹立我們的品牌名稱。現在面對最近的市場轉變，今年我們專注於加大對優質新系列和高品質 Gova 系列的研發力度，而不是今年的低端入門級產品。這兩款優質產品 SQi 和 U+ 收到了壓倒性的積極反饋，並證明在推出短短 3 個月內提升了我們的品牌。 SQi 在材料技術和設計方面的創新被媒體公認為同類產品中的革命性首創。

The new U+ has generated a widespread trend on social media. Also, the high-quality Gova series like B2 and G6T are also well received in the market accounted for nearly 80% of our mid-end products in the first 30 days of their debuts. Those are the proven testimonials of our brand leadership as well as our capability in product creation. Those new products the first teaser is to offer new product series, and there are a series of premium new products and high-quality Gova products in R&D drilling out in time next year to regain the growth in the China market.

新的U+在社交媒體上引起了廣泛的關注。此外，高品質的Gova系列B2、G6T等也深受市場歡迎，上市前30天占我們中端產品的近80%。這些都是我們品牌領導地位以及我們產品創造能力的證明。這些新品首推就是推出新品系列，明年還有一系列優質新品和高品質的Gova研發產品及時鑽出，重拾中國市場的增長。

Now on the global mobility solution provider front, we have made significantly progressed in 2022 through expansion of product categories and different solutions according to the different regional needs. We observed that micro mobility market continued to rebound and show great resilience since the pandemic. The urban transports like kick-scooters and e-bikes gain popularity after COVID when people prefer to commute with personal transportation method. We have established ourselves successfully recognized brand and player in the kick-scooter market within just 1 year entry, drilling our 4 products always positive response from market, gaining leadership in online channels first.

現在，在全球移動解決方案提供商方面，我們通過根據不同區域需求擴展產品類別和不同解決方案，在 2022 年取得了顯著進展。我們觀察到，自疫情以來，微出行市場持續反彈並顯示出強大的韌性。當人們更喜歡使用個人交通方式上下班時，滑板車和電動自行車等城市交通工具在 COVID 之後受到歡迎。我們在進入滑板車市場僅 1 年內就成功建立了自己公認的品牌和玩家，我們的 4 種產品始終受到市場的積極反響，率先在在線渠道獲得領導地位。

Now as 80% to 90% of sales in this market from off-line channels, we see a huge growth potential for our kick scooter market as our off-line channel is still in its early stage. We have planned to take a similar approach in the e-bike categories to repeat the success of the kick scooters as we plan to officially launch the first e-bike product in Q1 next year. We are also actively marketing the back e-bike product, building online shops, attracting customers and also bring up the brand awareness.

現在這個市場 80% 到 90% 的銷售額來自線下渠道，我們看到我們的滑板車市場有巨大的增長潛力，因為我們的線下渠道仍處於早期階段。我們計劃在電動自行車類別中採取類似的方法來重複踢滑板車的成功，因為我們計劃在明年第一季度正式推出第一款電動自行車產品。我們還積極營銷電動自行車產品，建立網上商店，吸引客戶並提高品牌知名度。

Meanwhile, after the online presence, we plan to expand into the specialized e-bike stores and other offline channels, in order to bring a wider traction. Now for the electric motorcycle market, although we took a setback this year in the sharing market, I believe the replacement demand is still there as our nearly 30,000 sharing vehicles are still in operation. We expect some of them will be replaced in 2023 after 4, 5 years in operation.

同時，在線上出現後，我們計劃擴展到專業的電動自行車商店和其他線下渠道，以帶來更廣泛的牽引力。現在電動摩托市場，雖然我們今年在共享市場受挫，但我相信換機需求還在，我們近3萬輛共享汽車還在運營。我們預計其中一些將在運行 4、5 年後於 2023 年被更換。

In addition, in the Southeast Asia market after several years of planning the seed, we're able to achieve meaningful growth this year. We are also investing in R&D and have product ready for the battery swapping solutions to lower the upfront cost for the consumers, which could be a game changer in the years to come.

此外，在東南亞市場經過幾年的種子規劃，我們今年能夠實現有意義的增長。我們還在研發方面進行投資，並為電池更換解決方案準備好產品，以降低消費者的前期成本，這可能會在未來幾年改變遊戲規則。

Now with those focused strategy and our determined mindset and execution, we're very optimistic that we will recover from the temporary downturn in 2022 and then restrengthen our brand and regain growth and profitability in 2023. Now I will turn the call over to CFO, Fion, to discuss our financial results.

現在，憑藉這些專注的戰略以及我們堅定的心態和執行力，我們非常樂觀地認為，我們將在 2022 年從暫時的低迷中復蘇，然後在 2023 年重振我們的品牌並恢復增長和盈利能力。現在我將把電話轉給首席財務官， Fion，討論我們的財務結果。

Thank you, Yan, and hello, everyone. Please note that our press release contains all the figures and comparisons you need, we have also uploaded excel format figures to our IR website for your easy reference. As I review our financial performance, we are referring to the third quarter figures [on say] otherwise, and that all mandatory figures are in RMB if not specified.

謝謝嚴老師，大家好。請注意，我們的新聞稿包含您需要的所有數據和比較，我們還將 excel 格式的數據上傳到我們的 IR 網站，供您參考。當我審查我們的財務業績時，我們指的是第三季度的數字 [on say] 否則，如果沒有指定，所有強制性數字均以人民幣為單位。

Total sales volume, including China and overseas market for the third quarter was 321,000 units decreased by 19% compared to the same period of last year. As our overseas business continued to gain traction. Sales volume from the international market has been growing fast and this quarter contributing 18% of our total sales volume. And if we're looking at the 9 months, it contributed 15% of the total volume. China market sales volume was 263,000 units, representing a 33% year-over-year decrease.

第三季度包括中國和海外市場在內的總銷量為321,000輛，同比下降19%。隨著我們的海外業務繼續獲得牽引力。來自國際市場的銷量一直在快速增長，本季度占我們總銷量的18%。如果我們看這 9 個月，它貢獻了總量的 15%。中國市場銷量為26.3萬輛，同比下降33%。

While most of the sales volume decrease was contributing to the decline of our lower-end Gova entry-level series. Total sales volume of our premium series remain at the same level, 224,000 units in the third quarter versus 230,000 of the last year. And those premium models together accounted for 85% of the total sales volume in China market compared to 59% in the same period of 2021. International markets continued to see high-speed growth, thanks to kick-scooter sales ramp up. The total sales volume reached 58,000 units among which the kick-scooter sales volume was 55,000 units, more than doubled compared to last quarter and e-motorcycle sales volume decreased by 1/3 to 3,000 units, mainly due to the temporary headwinds from defining to be sharing others.

雖然大部分銷量下降是導致我們低端 Gova 入門級系列下降的原因。我們高端系列的總銷量保持在同一水平，第三季度為 224,000 台，而去年同期為 230,000 台。這些高端車型合計佔中國市場總銷量的 85%，而 2021 年同期為 59%。國際市場繼續保持高速增長，這要歸功於滑板車銷量的增長。總銷量達到58,000輛，其中滑板車銷量為55,000輛，比上一季度增長一倍以上，電動摩托車銷量下降1/3至3,000輛，主要是由於定義到臨時的逆風分享他人。

This year, the sharing business companies in Europe are facing challenges raising new capital, which in turn, impacts their budget for expansion. The first quarter, our total revenue was RMB 1.15 billion, decreased by 6% compared to the same period of last year and branded scooter ASP increased was 3,287 increased by nearly 17%. To break down the revenue by ranging, the e-scooter revenue from China market was RMB 859 million, decreased by 20%, and the ASP in China market reached RMB 3,265, 19% higher on a year-over-year basis as product mix was more concentrated on premium autos as mentioned ahead.

今年，歐洲的共享業務公司面臨著籌集新資金的挑戰，這反過來又影響了他們的擴張預算。第一季度，我們的總收入為人民幣 11.5 億元，同比下降 6%，品牌踏板車平均售價增加了 3,287 輛，增長近 17%。按收入範圍細分，中國市場電動滑板車收入為人民幣 8.59 億元，下降 20%，中國市場的平均售價達到人民幣 3,265 元，同比增長 19% 作為產品組合如前所述，更專注於高檔汽車。

Overseas scooter revenue, including kick-scooters, e-motorcycles were the RMB 195 million in the third quarter increased by more than threefold year-over-year. In the third quarter, overseas scooter revenue accounted for 19% of our total scooter revenue. Branded scooter ASP of the overseas market decreased by 61% since lower price kick-scooter, which ASP is only 25% to 30% of the e-scooters are now taking greater share of the total scooter revenues.

海外滑板車收入，包括滑板車、電動摩托車，第三季度為人民幣 1.95 億元，同比增長超過三倍。第三季度，海外滑板車收入占我們滑板車總收入的 19%。自低價滑板車以來，海外市場的品牌滑板車平均售價下降了 61%，平均售價僅佔電動滑板車的 25% 至 30%，目前在滑板車總收入中所佔份額更大。

But looking at each category separately, both e-moped and kick-scooters saw a year-over-year ASP improvement of 30% to 35%. In addition, accessories, spare parts and services revenue were RMB 99 million, decreased by 7% due to the less overseas demand for extra battery packs. Gross margin of this quarter was 22.1%, 2.1 ppt higher compared the third quarter of 2021 and 1.2 ppt higher than the previous quarters. Out of the year-over-year 2.1 ppt increase 2.5 ppt was due to better product mix in the China market, 1 ppt due to the increase in U.S. dollar exchange rate and minus 1.4 ppt due to the higher proportion of kick-scooter sales with lower gross margin. Our total operating expenses for the third quarter was RMB 263 million, 72% higher than the same period of last year. The operating expenses as the percentage of revenue was 23% compared to 13% year-over-year.

但分別看每個類別，電動助力車和滑板車的平均售價同比增長 30% 至 35%。此外，由於海外對額外電池組的需求減少，配件、備件和服務收入為人民幣 0.99 億元，下降 7%。本季度毛利率為22.1%，比2021年第三季度高2.1個百分點，比上一季度高1.2個百分點。同比增長 2.1 個百分點，其中 2.5 個百分點是由於中國市場更好的產品組合，1 個百分點是由於美元匯率上漲，負 1.4 個百分點是由於滑板車銷售比例較高較低的毛利率。我們第三季度的總運營費用為人民幣 2.63 億元，比去年同期增長 72%。營業費用佔收入的百分比為 23%，而去年同期為 13%。

Going into details of our expenses. Total selling and marketing expenses were [RMB 170 million], RMB 81 million higher year-over-year, including around RMB 54 million in marketing and promotions for kick-scooters and domestic new products and the rest is RMB 27 million in depreciation and amortization expenses of the new stores and stock-related costs. Despite being a global leader in e-motorcycle, we are still new to the kick-scooter market. To quickly gain product popularity, we put lots of resources and efforts into the online e-commerce platform like Amazon, Shopify and et cetera.

詳細了解我們的開支。總銷售和營銷費用為 [1.7 億元人民幣]，同比增加 8,100 萬元人民幣，其中約 5,400 萬元人民幣用於滑板車和國產新產品的營銷和促銷，其餘為 2,700 萬元人民幣的折舊和攤銷新店的開支和庫存相關的成本。儘管我們是電動摩托車領域的全球領導者，但我們在滑板車市場仍然是個新手。為了快速獲得產品知名度，我們在亞馬遜、Shopify 等在線電子商務平台上投入了大量資源和精力。

We are glad to see those inputs have already paid off excellent online customer feedback help us enter into more off-line channels, which we believe is crucial for us to further expand our kick-scooter market share and bring us to the next level as the global leader in micro mobility, and we believe those online promotion expenses as a percentage of revenue will become lower going forward with our market share increasing.

我們很高興看到這些投入已經得到回報，出色的在線客戶反饋幫助我們進入更多的線下渠道，我們認為這對於我們進一步擴大滑板車市場份額並將我們提升到一個新的水平至關重要微移動領域的全球領導者，我們相信隨著我們市場份額的增加，這些在線推廣費用佔收入的百分比將會降低。

Starting from August and lasting to the end of October, we held a series of events in downtown areas in more than 20 cities in China, showing the new products, setting up top of stores, offering test rides and providing a platform for new fans to sharing their riding experiences and celebrate with each other. More importantly, we keep being committed to the user and core fans community.

從8月開始一直持續到10月底，我們在全國20多個城市的鬧市區舉辦了系列活動，展示新品、設置頂層店、提供試乘，為新粉絲提供平台。分享他們的騎行經歷並互相慶祝。更重要的是，我們始終致力於用戶和核心粉絲社區。

To summarize, we invested RMB 54 million more in marketing expenses to those overseas and domestic marketing promotions altogether in this quarter. In addition, last year, we expand our retail channels by adding nearly 15,000 new franchise stores. Those new store depreciation and amortization expenses will have a continuous 3-year financial impact on selling and marketing expenses.

總而言之，本季度我們在海外和國內營銷推廣方面總共投入了5400萬元人民幣的營銷費用。此外，去年，我們通過新增近 15,000 家特許經營店擴大了我們的零售渠道。這些新店折舊和攤銷費用將對銷售和營銷費用產生連續 3 年的財務影響。

R&D and G&A expenses together are RMB 94 million in the third quarter, an increase of RMB 30 million compared to the same period of last year, among which staff-related expenses were [RMB 17 million] higher. Design and testing expenses was RMB 7 million higher as we expand our product portfolio and global footprint, we will continue to invest in talent, professionals and other resources to support our technology and technology development and organizational upgrades for a global pioneer.

第三季度研發和一般費用合計為人民幣 9400 萬元，比去年同期增加人民幣 3000 萬元，其中與員工相關的費用增加 [人民幣 1700 萬元]。隨著我們擴大產品組合和全球足跡，設計和測試費用增加了 700 萬元人民幣，我們將繼續投資於人才、專業人才和其他資源，以支持我們的技術和技術開發以及組織升級，成為全球先行者。

The total operating expenses exclude share-based compensation were RMB 247 million, increased by 73% year-over-year, representing 21% of revenue. This quarter, we had an income tax benefit of RMB 6.6 million compared to RMB 17 million income tax expenses last year. Since we were identified as a Jiangsu provincial high-tech enterprise, we will qualify for a lower [corporate] income tax, and the tax refund was booked in this quarter same as in last quarter.

不包括股權激勵的總運營費用為人民幣 2.47 億元，同比增長 73%，佔收入的 21%。本季度，我們的所得稅收益為 660 萬元人民幣，而去年的所得稅費用為 1700 萬元人民幣。由於我們被認定為江蘇省高新技術企業，我們將有資格獲得較低的[企業]所得稅，本季度與上一季度一樣入賬退稅。

The fourth quarter net income was RMB 2.9 million compared with RMB 92 million in the third quarter 2021 and the net income margin was 0.3% compared with 7.5% in the same period of 2021. Adjusted or non-GAAP income was RMB 20 million, net margin of 1.7%.

第四季度淨利潤為 290 萬元人民幣，而 2021 年第三季度為 9200 萬元人民幣，淨利潤率為 0.3%，而 2021 年同期為 7.5%。調整後或非 GAAP 收入為 2000 萬元人民幣，淨額利潤率為 1.7%。

Turning to our balance sheet and cash flow. We ended the quarter with RMB 1.48 billion in cash, restricted cash, term deposits and short-term investments. Our operating cash flow was positive RMB 73 million, mainly due to the payment term benefits from the suppliers. Inventory slightly decreased on a sequential basis and increased by RMB 170 billion on a year-over-year basis, mainly because of the international kick-scooter sales ramp-up since we need to stock up locally to ensure a fast turnover when orders came in, as mentioned in our previous calls.

轉向我們的資產負債表和現金流量。本季度末，我們擁有 14.8 億元人民幣的現金、受限現金、定期存款和短期投資。我們的經營現金流為正人民幣 7300 萬元，主要是由於供應商的付款期限利益。庫存環比略有下降，同比增加1700億元，主要是由於國際滑板車銷售量增加，我們需要在當地備貨以確保訂單來時的快速周轉，正如我們之前的電話中提到的那樣。

The CapEx for the third quarter was [RMB 80 million] compared to RMB 76 million in the same period last year. The decrease was mainly due to the new store openings slowed down.

第三季度的資本支出為 [8000 萬元人民幣]，而去年同期為 7600 萬元人民幣。下降主要是由於新店開張速度放緩。

Now turning to the guidance. In light of the volatile domestic market and our strategy focused on the premium market. We expect the fourth quarter revenue to be in the range of RMB 789 million to RMB 986 million. No change to a decrease of 20% year-over-year. Please be aware that this outlook is based on information available as of the date and reflects the company's current and preliminary expectations, which is subject to change due to the uncertainties related to various factors such as the peso and the COVID-19 pandemic recovery among others. With that, let's now turn -- open the call for any questions that you may have for us. Operator, please go ahead.

現在轉向指導。鑑於國內市場動盪，我們的戰略專注於高端市場。我們預計第四季度收入將在人民幣 7.89 億元至人民幣 9.86 億元之間。同比下降 20% 沒有變化。請注意，此展望基於截至當日可用的信息，反映了公司當前和初步的預期，由於與比索和 COVID-19 大流行恢復等各種因素相關的不確定性，該預期可能會發生變化.有了這個，讓我們現在開始 - 打開您可能對我們提出的任何問題的電話。接線員，請繼續。

(Operator Instructions) The first question comes from the line of Jing Chang from CICC.

（操作員說明）第一個問題來自中金公司的Jing Chang。

This is in Jing Chang from CSCC. I have 2 follow-on questions. The first is about our selling and marketing expense. We see that our selling and marketing expense in the third quarter reached a historic high. And Fion just mentioned from breakdowns what about looking ahead? So which part is expected to be sustained and which part is expected to decline?

這是來自 CSCC 的 Jing Chang。我有 2 個後續問題。首先是關於我們的銷售和營銷費用。我們看到我們在第三季度的銷售和營銷費用達到了歷史最高水平。而 Fion 剛剛從故障中提到了展望未來呢？那麼哪些部分預計會持續，哪些部分預計會下降？

And what is the expected steady state level of our quarterly selling and marketing expense? And do we have some methods to promote -- to reduce the expenses? And my second question is about our product pipeline. At present, we can see the cost of lithium battery is still very high. So as for the product strategy for next year, especially in Chinese domestic market. So what market segments should we focus more on for our new product is the premium market or some lower-tier city market as we want to achieve positive sales growth. This is my 2 questions.

我們季度銷售和營銷費用的預期穩態水平是多少？我們是否有一些方法可以促進 - 減少開支？我的第二個問題是關於我們的產品線。目前我們可以看到鋰電池的成本還是很高的。那麼關於明年的產品策略，尤其是在中國國內市場。那麼我們的新產品應該更關注哪些細分市場是高端市場還是一些低線城市市場，因為我們要實現銷售正增長。這是我的2個問題。

Thank you, Jing. This is Fion. I will answer the first question. Regarding to your questions about the selling and marketing, for sure, as you said, that I already gave the breakdown. And I think the depreciation and amortization expenses related to the new stores will continue at the same level for the next 2 years. Since we opened more than 14,000 new stores starting from 2021. And those depreciation and amortization expenses will last for at least 36 months. So that means that for the next 2 years, we still have those kind of expenses in the selling and marketing expenses. And in addition for the new stores we opened this year and for the following years, we will amortize those expenses in the same way.

謝謝你，靜。這是菲恩。我會回答第一個問題。關於你關於銷售和營銷的問題，當然，正如你所說，我已經給出了細分。而且我認為與新店相關的折舊和攤銷費用在未來 2 年將繼續保持在同一水平。由於我們從 2021 年開始新開了超過 14,000 家門店。而這些折舊和攤銷費用將持續至少 36 個月。所以這意味著在接下來的兩年裡，我們在銷售和營銷費用中仍然有這些費用。除了我們今年和接下來幾年開設的新店，我們將以同樣的方式攤銷這些費用。

So this is the major part of the expenses will still remain in the selling expenses. And the other part is our marketing expenses for the daily operations, which we will reduce at the lowest level. But for the kick-scooters, as I mentioned, since we are still using the expansion strategy for the next 2 years, unless our market share increase at a very significant level, which I mean it should be around 1 million or around 800,000 units globally. Otherwise, those are promotion expenses, especially the online traffic expenses which are huge or by the efficiency.

所以這部分費用的主要部分還是會留在銷售費用中。另一部分是我們日常運營的營銷費用，我們會在最低水平上減少。但是對於滑板車，正如我提到的，因為我們在接下來的兩年內仍在使用擴張策略，除非我們的市場份額以非常顯著的水平增長，我的意思是它應該在全球範圍內達到大約 100 萬或大約 800,000 台.否則就是推廣費用，尤其是流量費用巨大或者靠效率的費用。

Those online promotion expenses were still as a significant level along with our market share increasing in the kick-scooters. For the reduction of the selling expense, since we already made the -- we already made the cut of the -- of the staff cost, which means we merged several teams, and we increased the staff efficiency to increase the whole company's staff cost. Those will make the benefit beginning from next year, I think, since those staff costs will only reflect on the financial statements later for at least 1 or 2 quarters, then we would see the obvious impact on the financial statements. But for sure, we already did several execution improvements to maintain the lowest level of the expenses and to improve the whole company's efficiency.

隨著我們在滑板車市場份額的增加，這些在線推廣費用仍然很高。為了減少銷售費用，因為我們已經削減了——我們已經削減了——員工成本，這意味著我們合併了幾個團隊，我們提高了員工效率，從而增加了整個公司的員工成本。我認為，這些將從明年開始受益，因為這些員工成本只會在至少 1 或 2 個季度後反映在財務報表上，然後我們會看到對財務報表的明顯影響。但可以肯定的是，我們已經做了幾項執行改進，以保持最低水平的費用並提高整個公司的效率。

And to summarize, I guess -- I think for the next 2 to 3 quarters, the selling and marketing expenses altogether will remain at the quarterly level will remain around RMB 100 million to RMB 130 million for the next 2 to 3 quarters. And after that, you will see at least a 20% decrease on quarterly basis. This is the answer for your first question. I'll pass the second question for Yan.

總而言之，我想 - 我認為在接下來的 2 到 3 個季度中，銷售和營銷費用總共將保持在季度水平，在接下來的 2 到 3 個季度中將保持在 1 億至 1.3 億元人民幣左右。在那之後，你會看到至少每季度減少 20%。這是你第一個問題的答案。我將通過 Yan 的第二個問題。

Sure. I think just to a little bit add on the first question, right? So I think in terms of absolute value, if you look at that number, but if you look at it as a percentage of sales, we'll definitely go down. If you look at Q3 this year, we look at the sales and marketing its almost like 14%, 15% of the revenue. I think partially as what Fion just mentioned in terms of up number, that's what you see on the numerators, right, on the denominator, the revenue growth was obviously is not as it's below our expectation. So a lot of fixed overheads, for example, we have like marketing activities or product rollout, right? It's a fixed cost divided by revenue amount.

當然。我想在第一個問題上再補充一點，對嗎？所以我認為就絕對價值而言，如果你看這個數字，但如果你看它佔銷售額的百分比，我們肯定會下降。如果你看看今年第三季度，我們會發現銷售和營銷幾乎佔收入的 14%、15%。我認為部分正如 Fion 剛才提到的上升數字，這就是你在分子上看到的，對，在分母上，收入增長顯然沒有低於我們的預期。那麼很多固定的管理費用，例如，我們有營銷活動或產品推出，對嗎？它是固定成本除以收入金額。

That's why you guys see a high percentage. But if you look at our -- nothing in 2022, but if you look like 2021 or 2020, our sales and marketing roughly as a percent of revenue, we keep it basically somewhere between 7% to 9% fluctuate. I think that's what we're trying to -- we target to get in 2023. But obviously, the absolute dollar amount is probably similar. But I think that's just on that note.

這就是為什麼你們看到很高的百分比。但如果你看看我們的——2022 年什麼都沒有，但如果你看起來像 2021 年或 2020 年，我們的銷售和營銷大致佔收入的百分比，我們基本上將其保持在 7% 到 9% 之間波動。我認為這就是我們正在努力的——我們的目標是在 2023 年實現。但顯然，絕對金額可能是相似的。但我認為這只是在那張紙條上。

I think the second part, you asked about the product investment. I think the issue is actually where we focus on premium also what we call the mass premium product basically, the premium product will be our new series, anything above RMB 5,000 for China market, the mass premium product will be something basically anything above RMB 3,500 to RMB 5,000, which what we call the high-quality Gova product.

我覺得第二部分，你問的是產品投資。我認為問題實際上是我們關注的是高端產品，也就是我們所說的大眾高端產品，高端產品將是我們的新系列，在中國市場超過 5,000 元人民幣，大眾高端產品基本上會超過 3,500 元人民幣到5000元，也就是我們所說的高品質Gova產品。

I think those will be sort of the focus at least that will be focus for 2023, partially because when we actually did a deep diagnostics on our entry-level product, the 0 series after the lithium price increases, it's -- basically, it's gross margin contribution almost become insignificant nothing, it's almost 0, but if you actually take into consideration of the as a [sales costs], all the stuff.

我認為這些將至少成為 2023 年的重點，部分原因是當我們實際對我們的入門級產品進行深入診斷時，鋰價格上漲後的 0 系列，它 - 基本上，它是毛保證金貢獻幾乎變得微不足道了，它幾乎是 0，但如果你真的把它作為一個 [銷售成本] 考慮在內，所有的東西。

Those products is not making value for the company at this point. So that's the reason that we're focusing on the what we call the premium and our mid end. Having said that, I think if you look at the entire market, the entire market for that product is still high. Given our sales volume at this point, it's below 1 million units. You will pay entire market that for the product above RMB 3,500. We're still looking at that market is probably at least about [200 units] not more. So I think the total addressable market is still so large for us to attack. So to this point, we feel like there is no point to spend additional R&D dollars product that actually makes 0 very small attribute of gross profit contributions.

這些產品目前還沒有為公司創造價值。所以這就是我們專注於所謂的高端和中端的原因。話雖如此，我認為如果你看看整個市場，那個產品的整個市場仍然很高。鑑於我們目前的銷量，它低於 100 萬台。您將為超過 3,500 元人民幣的產品支付整個市場。我們仍在關注該市場可能至少約為 [200 個單位]，而不是更多。所以我認為總的可尋址市場仍然很大，我們可以攻擊。因此，就這一點而言，我們覺得沒有必要花費額外的研發資金來生產實際上使毛利潤貢獻為 0 的非常小的產品。

Our next question comes from the [Jing Chang] of CICC.

我們下一個問題來自中金公司的【景暢】。

Hello. I'm from CICC, and there are 3 questions. The first question is I'd like to know what's your product strategy for overseas markets in 2023? And do you have sales volume growth in Malaysia. And the second question is, what's your channel strategy next year domestically? Will use this channel -- will you reduce the channel stores -- or what will you focus more on? And the second -- the third question is I'd like to know the gross margin of e-scooters in the Gova series or if you can share with us.

你好。我是中金公司的，有3個問題。第一個問題，請問貴司2023年在海外市場的產品策略是什麼？你在馬來西亞有銷量增長嗎？第二個問題，你們明年在國內的渠道策略是什麼？會使用這個渠道——你會減少渠道商店——還是你會更關注什麼？第二個 - 第三個問題是我想知道 Gova 系列電動滑板車的毛利率，或者您是否可以與我們分享。

Sure. So I'll start the first 2, and then I'll let Fion address the gross margin question. So first, on the overseas strategy, we're looking at again, we divested the market into sort of what we call the motorcycle market and the micro mobility market. Within the motorcycle market, I think our bread-and-butter market at this point is Europe and the North American market, which annually, we do about anywhere between 20,000 units to 30,000 units of electric motorcycles. As I mentioned in the earnings call this year, we took a set back because the sharing operator orders become 0. Last year, it was 10,000 units, right?

當然。所以我將開始前 2 個，然後讓 Fion 解決毛利率問題。所以首先，在海外戰略上，我們再次審視，我們將市場剝離到我們所謂的摩托車市場和微型移動市場。在摩托車市場中，我認為目前我們的主要市場是歐洲和北美市場，我們每年生產大約 20,000 到 30,000 輛電動摩托車。正如我在今年的財報電話會議中提到的那樣，由於共享運營商訂單變為 0，我們受到了挫折。去年是 10,000 台，對嗎？

So -- but they will come back. It's just -- it kind of sort of fluctuate, depends on they haven't raised the capital this year, they focused on internal operation all that stuff. Now then I think this market will grow with the market continuously. The overall market for the electric motorcycle market for the Europe and the United States market is small. At this point, it's probably like 100,000 units a year. So overall, I think it's a small market, but we own like 20-something percent. So we'll actually continue to grow with the market. Now the second electric motorcycle market, which really is still in its very early stage in the Southeast Asian market. So we do see that we grow in Southeast Asia market.

所以——但他們會回來的。只是 - 它有點波動，取決於他們今年沒有籌集資金，他們專注於內部運營所有這些東西。現在我認為這個市場將隨著市場不斷增長。歐美市場電動摩托車市場整體市場規模較小。在這一點上，它可能是每年 100,000 台。所以總的來說，我認為這是一個小市場，但我們擁有大約 20% 的份額。因此，我們實際上將繼續與市場一起成長。現在第二個電動摩托車市場，在東南亞市場確實還處於非常早期的階段。所以我們確實看到我們在東南亞市場增長。

We probably double our sales in Southeast Asia market, even by doubling we're still looking at 6,000 to 7,000 units. It's still a small market. I think we're trying to exploring different models like battery swapping solutions in that market. The issue with that market is actually the electric motorcycle, economics electric motorcycles is still -- the price is still too expensive compared with petrol. So the upfront cost for the users is actually difficult. So we're working with partners there to see on the sort of a battery swapping solutions than actually sort of lower the upfront cost for the consumers. So some of the early trials already done in Singapore, but also early trials in Thailand. So I think those are something that we're exploring.

我們可能會將東南亞市場的銷售額翻一番，即使翻一番我們仍然在尋找 6,000 到 7,000 台。這仍然是一個小市場。我認為我們正在嘗試在該市場探索不同的模型，例如電池交換解決方案。那個市場的問題實際上是電動摩托車，經濟電動摩托車仍然是 - 與汽油相比價格仍然太貴。所以前期成本對於用戶來說其實是很難的。因此，我們正在與那裡的合作夥伴合作，尋找一種電池更換解決方案，而不是真正降低消費者的前期成本。所以一些早期試驗已經在新加坡完成，但也在泰國進行了早期試驗。所以我認為這些是我們正在探索的東西。

Then the next is sort of the micro mobility market, which this year, we see a huge volume growth first being the kick-scooter market, which the entire market on an annual basis is probably like 4 million units. We're still very -- I think we have a strong -- this year, we have been able to achieve a name. Basically, people would recognize us on Amazon, on online website saying, "Hey, this is a brand that can produce high-quality product in kick-scooters. But even with this year's volume, like the first 3 quarters, you added together, we just did about 80,000 units. All of that 4 million units market were very, very small. The reason being that we haven't really sort of entered bench of the off-line stores yet. And historically, 90% of the sales are actually conducted offline.

接下來是微型移動市場，今年，我們首先看到滑板車市場的巨大銷量增長，整個市場每年可能有 400 萬台。我們仍然非常 - 我認為我們有一個強大的 - 今年，我們已經能夠獲得一個名字。基本上，人們會在亞馬遜上認出我們，在在線網站上說，“嘿，這是一個可以生產高品質滑板車產品的品牌。但即使是今年的銷量，比如前三個季度，你加起來，我們剛剛做了大約 80,000 個單位。所有 400 萬個單位的市場都非常非常小。原因是我們還沒有真正進入線下商店的工作台。從歷史上看，90% 的銷售額是實際上是離線進行的。

So those are some things we're working on, which we actually have made a significant progress but it just takes time. I think usually for any of those offline chains, it actually takes 6 to 9 months to enter the store and actually be able to start to make sales. So I think that's on the kick-scooter market. And the last 1 is the e-bicycle market, which is actually -- it's gaining traction -- been getting tractions in the last few years. we have a product out next year, which actually will help us to make a name in that market.

所以這些是我們正在努力的一些事情，我們實際上已經取得了重大進展，但這只是需要時間。我認為通常對於那些線下連鎖店來說，實際上需要 6 到 9 個月才能進入商店並真正開始銷售。所以我認為這是在滑板車市場上。最後一個是電動自行車市場，實際上——它正在獲得牽引力——在過去幾年中一直受到牽引。明年我們將推出一款產品，這實際上將幫助我們在該市場上揚名立萬。

I think we're going to follow a similar strategy that we took on the kick-scooter market, basically making the name on online, gather enough interest online that are enough early user adoptions and then start going to offline. And on top of that, so any sort of -- I think even with the previous questions on the sales expense, right now, the micro mobility business unit has a high sales expense. That's because a lot of stuff are done online, where you see a high sales expense in terms of purchasing the traffic, all that stuff.

我認為我們將遵循我們在滑板車市場上採取的類似策略，基本上是在網上打響名聲，在網上收集足夠多的興趣，讓足夠的早期用戶採用，然後開始走向線下。最重要的是，我認為即使有之前關於銷售費用的問題，現在微型移動業務部門的銷售費用也很高。那是因為很多事情都是在線完成的，你會看到購買流量等方面的高額銷售費用。

We actually 90% of the sales coming -- become offline, you can see a significant decline in terms of sales expense. So I think that's sort of the -- the strategy for overseas market. We don't have the volume target yet. I think too early for this call to us to give volume target.

實際上，我們 90% 的銷售額都來自線下，您可以看到銷售費用大幅下降。所以我認為這是海外市場的戰略。我們還沒有數量目標。我認為給我們打電話給目標量還為時過早。

I think on the domestic channels in China, we have about 3,300 stores right now so far in domestic channels. I think we're taking a very slow stage this year to expand the stores because I think with the current market shift, especially with the lithium battery price went up. I think right now, the number of stores is enough for us to sustain our growth. I think the focus is merely for to improve the per store sales or same-store sales in 2023. So we're not looking at expanding more stores, but really focused on improve the per store sales by 10% to 15% next year. I'll let Fion to take the gross margin part sorry.

我認為在中國的國內渠道，我們目前在國內渠道擁有大約 3,300 家門店。我認為我們今年擴張門店的速度非常緩慢，因為我認為隨著當前的市場變化，尤其是鋰電池價格上漲。我認為現在，門店的數量足以讓我們維持增長。我認為重點僅僅是為了提高 2023 年的單店銷售額或同店銷售額。所以我們不打算擴大更多的門店，而是真正專注於明年將單店銷售額提高 10% 到 15%。抱歉，我會讓 Fion 承擔毛利率部分。

Yes. I'll take third question regarding to the gross margin of Gova series -- let me rephrase the definition of our accounting rules since the gross margin when we account for our financial statements. It's contained -- it not only contains the bond cost, but also it contains all the discount, the rate base of the sales. and also the logistics expenses and all the selling expenses related to the sales volume -- so that means all the direct expenses and costs related to the sales unit will all accounted at the cost of the goods sold.

是的。關於 Gova 系列的毛利率，我將提出第三個問題——讓我重新表述我們會計規則的定義，因為我們在核算財務報表時的毛利率。它包含 - 它不僅包含債券成本，還包含所有折扣，即銷售的利率基礎。以及與銷售量相關的物流費用和所有銷售費用——這意味著與銷售單位相關的所有直接費用和成本都將按銷售商品的成本核算。

So this is above our gross margin. And when we counted all the cost and expenses together, our gross margin of the Gova series including the entry to the premium models, the gross margin range is around 15% to 22%. So that means the cheapest or the lowest level of our Gova series. The gross margin will still above 15%, which is the average level of our competitors.

所以這高於我們的毛利率。當我們把所有的成本和費用加在一起計算的時候，我們Gova系列的毛利率包括進入高端機型，毛利率區間在15%到22%左右。所以這意味著我們 Gova 系列中最便宜或最低級別的。毛利率仍將在15%以上，這是我們競爭對手的平均水平。

And this quarter, when you see the gross margin improved since our product mix improved, the entry level only contains of the 10% of our sales volume for sure, the weighted average gross margin of the Gova series will improve to around 20%. So this is everything about the gold as risk gross margin. I hope this will address your question.

而這個季度，當你看到我們的產品組合改善後毛利率有所提高，入門級肯定只占我們銷量的10%，Gova系列的加權平均毛利率將提高到20%左右。所以這就是黃金作為風險毛利率的一切。我希望這會解決你的問題。

(Operator Instructions) At this time, there are no further questions from the line. May I hand the call back to the management for closing?

（操作員說明）此時，線路上沒有其他問題。我可以將電話交還給管理層以關閉嗎？

All right. Thank you, operator, and thank you all for participating on today's call and for your support. We appreciate your interest and look forward to supporting to you again next quarter on our progress.

好的。謝謝接線員，也感謝大家參加今天的電話會議並給予支持。我們感謝您的關注，並期待在下個季度再次為您提供支持，幫助我們取得進展。

Thank you, management. Ladies and gentlemen, that concludes today's conference call. Thank you for your participation. You may now disconnect.

謝謝你，管理。女士們，先生們，今天的電話會議到此結束。感謝您的參與。您現在可以斷開連接。