Greetings, ladies and gentlemen. Welcome to Horizon Robotics 2024 Full Year Results Conference Call. At this time, all participants are in a listen- only mode. A question and answer session will follow the formal presentation. As a reminder, this conference is being recorded. I'd now like to turn the call over to your host, Ms. Xuan Jiang, Head of Investor Relations of Horizon Robotics. Thank you, Xuan. You may begin. Thank you. Hello everyone and welcome to the investor call and the audio webcast hosted by Horizon Robotics. On today's call, we have Dr. Kai Yu, our founder and CEO. The Chairman of the Board, Ms. Annie Tao, Co-Founder and COO of Horizon Robotics. Also joining today for the Q&A session are Mr. Lei Wang, the Acting CFO and Head of Capital Markets, and Mr. Ivan Wang, Head of Finance of Horizon Robotics. Before we start, we want to remind you that this call may include forward-looking statements which are underlined by a number of risks and uncertainties and may not be realized in the future for various reasons. Information about general market conditions come from a variety of sources outside of Horizon Robotics. This presentation also contains some unaudited non-IFRS financial measures that could be considered in addition to the company's financial preparation. I will now turn the call to our CEO, Dr. Yu. [Foreign language] Good evening. I'm Kai Yu, the founder and CEO of Horizon Robotics. Today marked the first earnings call since Horizon Robotics listing and I'm very delighted to be here to share with you. Our business performance from the past year. [Foreign language] First of all, allow me to present an overview of the industry. In 2024, the intelligent trend of China's passenger vehicle market accelerated with smart driving r emaining a key focus and the user experience rapidly improving. The installation rate of the smart driving s ystems in China's passenger vehicle sector exceeded 6 5% in 2024, while the penetration rate o f the new energy vehicles reached 46%. This indicates that in China, both traditional ICE vehicles and electric vehicles are accelerating their transformation toward intelligence with smart driving becoming a standard feature across different powertrains. Among them, the penetration rate of Autonomous D riving solutions is experiencing rapid growth. The sales of the vehicles equipped with AD solutions now account for 19.5% of all intelligent vehicles, marking that L2+ and L2++ smart driving with NOA functionalities start to penetrate into the mainstream market. [Foreign language] Against this backdrop, we have further consolidated. Our leadership position in Advanced Driver Assistance System ADAS solutions and on top of driving AD solutions with L2+, L2++ achieving a series of impressive accomplishments. [Foreign language] End of 2024 we have captured over 40% of the ADAS market share among the Chinese domestic OEM brands, establishing ourselves as the preferred ADAS solution provider. Recently we have also formed a strategic partnership with a leading international Tier 1. Together we will promote Horizon Robotics next generation ADAS solution Horizon Mono along with the Journey 6B processing hardware to the global market. This marks a crucial step in Horizon Robotics globalization journey. [Foreign language] In the rapidly expanding AD market, our m arket share exceeded 30% in 2024. And r anks second among the independent third- party smart driving solution providers maintaining our leadership. Earlier this year we noticed that a series of launch events have been organized by the Chinese automakers including BYD, Changan, Geely, Chery and GAC. They have initiated a movement to promote the large- scale adoption of the smart driving technology with Highway NOA being equipped o n entry- level vehicle models with a selling price around RMB 100,000. Our solution based on the new generation Journey 6E and Journey 6M has successfully helped all these a bove- mentioned automakers to achieve a large-s cale application of a Highway NOA technology i n the mass market. This has positioned us as the preferred partner in the automaker push for smart driving for all this year. [Foreign language] In 2024 we achieved a record high in product solution delivery volumes, shipping about 2.9 million units, bringing our total delivery v olumes to around 7.7 million units. Throughout 2024 we secured the design wins for over 100 vehicle models, increasing our t otal design wins to more than 310 models by the end of 2024. [Foreign language] In addition to the Automotive business, Horizon Robotics through our subsidiary D-Robotics, is building a comprehensive infrastructure for consumer robotics development. Collaborating with clients, makers and individual developers to jointly create a smart consumer robotics ecosystem. Up to today, D-Robotics has shipped approximately 5 million units, empowering over 100,000 developers and more than 200 startups. Its downstream pull- up of soil spread o ver several sectors including robotic vacuum cleaners, lawnmowers, robotic arms, home companion robots, and c onsumer robotics, making everyone's life better and easier. [Foreign language] Driven by these factors, we have achieved a revenue of RMB 2.38 billion representing a one year growth of 53.6% and maintained a gross profit margin of over 75%. At the same time, we continue to i mprove our R&D and operational. Management efficiency, resulting in a reduction of RMB 119 million in adjusted operating loss. We believe such strong financial performance demonstrates our competitiveness and our capability to sustain g rowth in a rapidly changing environment. [Foreign language] Next, I would like to share with y ou Horizon Robotics progress on product development over the past year. [Foreign language] In April 2024 we launched the full scenario s mart driving solution Horizon SuperDrive (HSD). This is an advanced smart driving product d eveloped based on the full- stack technology t hat integrates hardware and software featuring highly h uman- like driving behavior, exceptional traffic efficiency and a consistent experience across all scenarios. Additionally, the human machine interface of HSD with its minimalistic aesthetic design, dynamic interaction and hardware software co- engineering capability won the 2024 iF Design Award which is l ike the Oscar award in this sector. To date, Horizon Robotics HSD has secured d esign wins from multiple automakers for various v ehicle models and expected to achieve mass r eduction and delivery in the third quarter of 2025. [Foreign language] In 2024 we've launched the Journey 6 w hich was already in mass production in February 2025. The Journey 6 processing hardware has been v ery well recognized by the market with its scalability, powerful performance, and high efficiency. By the end of 2024 we have e stablished a partnership with over 20 automakers and OEM brands including leading domestic automakers, i nternationally renowned car manufacturers, top emerging automakers and the j oint venture automakers. The performance section, the Journey 6 Series, Journey 6P will soon be launched to the m arket and will be integrated into our HSD solution with mass production under delivery scheduled for the third quarter of this year. [Foreign language] In the field of Embodied Intelligence, in 2024 Horizon Robotics subsidiary D-Robotics as a consumer robotic solution provider officially launched a new generation of dedicated processing hardware, an e xtremely user friendly development kit, a widely c ompatible operating system and a full lifecycle c loud- based development environment for consumer robotics. By integrating hardware and software and emerging the agile cloud capabilities, D-Robotics aim to m ake development simpler and the consumer robotics are smarter and benefit more consumers. [Foreign language] Looking ahead to 2025, we believe this year will mark a critical turning point for smart driving technical breakthroughs, favorable policies, and high consumer acceptance. What jointly drives the large scale adoption o f ADAS solutions including L2+ and L2++? Horizon Robotics is committed to make the Highway NOA accessible in the price segment of RMB 100,000 through our latest ADAS and AD solutions paired with our new g eneration Journey 6 series of processing hardware. At the same time, as smart driving b ecomes more widely available, we expect to s ee the Urban NOA which is L2++ smart driving will be available in the price segment of RMB 200,000, creating more business opportunities for our HSD. [Foreign language] We anticipate that by 2025 the total d elivery volume of Horizon Robotics solution will e xceed 10 million units making us the first smart driving technology company in China t o achieve this milestone. [Foreign language] Thank you very much. Now I will hand over to our. Co-Founder and COO, Annie Tao please. Thank you Kai. Distinguished investors, I will now present our key financial results for the full year ended December 31st, 2024. To be mindful of the length of this call, I will focus on the main items in our discussion today. For additional details please refer to our earnings press release which has been posted on our Investor Relations website. Our total revenue for 2024 amounted to RMB 2.4 billion, an increase of 53.6% compared to the same period of last year. This was primarily driven by our core business Automotive Solution with a robust 57.2% growth. Our revenue from Automotive Solution is comprised of two parts. The first one is revenue from Product Solutions and the second one is License and Services. Revenue generated from Product Solutions increased by 31.2% to RMB 664.2 million. This growth was mainly driven by increased delivery war rooms throughout the year which reflect our increasing market share, stronger customer recognition and the demand of our products. Revenue generated from License and Services increased by 70.9% year- on- year to RMB 1.6 billion. This primarily due to the accelerating adoption towards smarter vehicles which has driven technical advancement of ADAS and AD solutions. This trend has still the significant demand from OEMs and Tier 1 suppliers for our algorithms, software development tools and technical services. Our overall gross margin was 77.3% in the past year, keeping at a very robust level and was significantly ahead of other automotive solutions providers across the whole industry. Moving on to the expenses, our R&D expenses was RMB 3.2 billion. It increased by 33.4% year- on- year. The intelligent driving industry is clearly approaching a pivotal inflection point. Always pushing the boundary of technology and striving for safer and better products is part of Horizon's core value. We never stop investing in it. The investment last year did not go to hiring more people, but more advanced tools and infrastructure with stronger productivity. Our continuous investment in R&D last year has translated into the brand new generation product and a definitive leading market position. While the industry has already been impressed by what we provide with our Journey 6 solutions, this is just a start. Administrative expenses increased by 43.8% year- on- year to RMB 637.6 million, partially due to professional services and other consulting fees associated with our successful Hong Kong IPO last year. We appreciate all the support and encouragement we received during the IPO, which opened up a new phase of development and growth of Horizon. Valley expenses increased by 25.2% to RMB 409.9 million. For Horizon, 2024 was an important year of grasping the opportunity to exercise besides market expansion, global development and branding uplift, resulting in a higher investment in marketing expenses. We defined adjusted operating loss as operating loss for the period adjusted by adding back share- based payments which are non- cash in nature and the listing expenses related to IPO. Our adjusted operating loss was RMB 1.5 billion, narrowed by 1 point, narrowed by 11.4% from the same period last year, representing our continued RMB and operational efficiency. Last but please let's move further to the bottom line. Accounting for equity method investment losses and gains from fair value changes from preferred shares, we recorded a net profit of RMB 2.3 billion. Now let's conclude our management presentation. I will now turn the call over to the operator to facilitate the Q&A session. Thank you everyone. Thank you management. Now we'll start the Q&A session. If you want to raise a question, please press star one. If you want to cancel a question, please press star two. Please feel free to raise any questions. To participate in our written Q&A, just type your question into the Ask Q uestion text area, then click the submit button. For the benefit of all participants on today's call, please limit yourself to two questions and if you have additional questions you can re- enter the queue. If you're a Mandarin speaker, please ask your questions in Chinese first, then follow with English translation. Our first question comes from Tim Seow with Morgan Stanley. Please go ahead. Your line is open. [Foreign language] My first question is about the product because since already this year we noticed that the democratization of smart driving in China is benefiting Horizon's sales of mid-range Journey 6 chips. Could Horizon easily and effectively convert this client to become high-end Journey 6P users in the higher market? Can Horizon soft plus hardware integrated solution become a key selling point? That's my first question. [Foreign language] Thank you very much Tim for your question. In terms of the impact of t he democratization of the smart driving, I think there are mainly two impacts. On one hand I think you have many increase in the volume. As we have seen from the beginning of this year, many automakers have been organizing their product launches. We are now providing the L2+ Highway NOA solution to automakers like BYD, Changan, Geely, Chery and GAC. Among these automakers, we are either the solution or one of the top two provider, making us the preferred partner for them to push for the large scale adoption of the smart driving. And our m arket share also has increased with these automaker. Importantly, we also have seen the increase of the ASP with the Highway NOA products, comparing with the previous ADAS products. [Foreign language] Highway NOA also will create significant business opportunities for Urban NOA solutions. We predict that the smart line with Urban NOA will be adopted by in the price RMB 200,000 this year. It will even further extend to the price range of RMB 150,000 in the future to adapt to these industry trends. [Foreign language] Highway and the ASP will increase by several times and moving from Highway NOA to Urban NOA, the ASP will increase b y several times again. In the next few years, Horizon Robotics will have a very favorable timing for very fast growth in the ASP. [Foreign language] We agree that strong software capabilities combined with a hardware software integrated design philosophy and capability are the key to differentiate from the competition. [Foreign language] In the field of smart driving, t he companies like Horizon Robotics and Tesla s tick to the software and hardware improvement i ntegration concepts and we are one o f the very few companies stick to this philosophy. [Foreign language] Look at the current competitive landscape of Highway NOA solutions. It is evident that only a few global suppliers are our competitors. If we move further toward Urban NOA, the more complex environment poses higher challenges for software capabilities. With our high- performance Journey 6P processing hardware and end- to- end advanced smart driving algorithms, our HSD can fully utilize t he optimal system efficiency brought by the hardware software integration delivering advanced smart driving features and functions that is truly user- friendly. That's why I see we indeed agree with you that these strong software capabilities t ogether with our hardware software integrated design system philosophy are the key to build differentiation. [Foreign language] I hope I've answered your first question. Thank you. [Foreign language] My second question is about the globalization because we notice global carmakers and Tier 1 suppliers are accelerating their adoption of autonomous driving function. With their new platform coming in 2026, will that help Horizon to accelerate tipping to the global market? That's my second question. Thank you. [Foreign language] Market in the past, although the demand for Autonomous Driving solutions was relatively lower in the overseas market, Horizon Robotics has made all the necessary preparations because we firmly believe as the technology matures there w ill not only be demand in China m arket but for sure global market demand. We have established a joint venture with Continental and formed deep partnership with Bosch. By leveraging these collaborations with the top international Tier 1s, we will build a product portfolio tailored to overseas customers and jointly explore the overseas markets. We also have seen a trend of Chinese auto OEMs to go to the overseas market. Horizon Robotics becomes the first choice or the preferred partners of Chinese OEMs. We will also for sure follow our customers to extend for the overseas market together. And as long as the overseas automakers i ncrease their investment in smart driving, we believe Horizon Robotics is fully prepared both i n terms of our products and organization capabilities, up till now, we have already secured t he design wins from several overseas automakers and expect to achieve more breakthroughs in the near future. Thank you. [Foreign language] Thank you Tim, I hope I've answered this question. [Foreign language] Thank you. Our next question comes from Ben Wang with Deutsche Bank. Please go ahead. [Foreign language] Hey I just see the J6M so my first question is regarding our Horizon SuperDrive product. Can you give us a bit more detail on the key customers and compared to the VLA technology, can you maybe give us more color on the technical roadmap of HSD product? [Foreign language] In terms of our HSD w e have secured design wins from several automakers and the first vehicle model will enter mass production in the third quarter of this year. However, we cannot disclose the names of our customers at this time point. Please wait for the official announcements by our customers and Horizon Robotics in t he future. And regarding to the HSD t echnology roadmap, Horizon Robotics have always been at the leading position regarding to the algorithm innovation. In 2021 we have won the first prize of Waymo Open Dataset Challenge and in 2023 we have published the UniAD paper w hich have won the best paper award of CVPR and this is for the first time papers passed by published for t he end-to-end AD algorithm. And also in 2024 our newly published papers have ranked number three regarding to the citation frequency in the field of AI t echnology and the HSD is our end- to- end VLA smart driving system based on the hardware software integration technology combining e nd- to- end AD models with multimodal l arge models and the HSD model can be divided into two parts, the high d imensional decision making with the large models and t he end-to-end trajectory planning. The combination- oriented world model serves as a common- sense system leveraging the multimodal large models to enhance scenario understanding capabilities. It excels in cross- domain common sense and logical analysis acting as the brain f or high- dimensional decision making. However, this multimodal, the large model does not rely on the cloud and is deployed on the vehicle ensuring the real- time responsiveness and making it the common sense system more timely and this is highly benefited from our software plus hardware unique advantage. The intuition- oriented world model serves as a real time system. It is trained based on large field driving data with strong spatial perception capabilities and excels in precise numerical predictions and specific trajectories. It functions more like a cerebellum for t he specific planning and control making driving behaviors more human like. [Foreign language] This is my answer for your first question. Thank you. [Foreign language] We are seeing a large push for autonomous driving democratization with multiple OEMs like BYD, Geely, Great Wall Motor, GAC and Chery all push autonomous driving and using our J6M chips. Can you comment on our hardware product mix in the future. [Foreign language] Thank you very much for your question. Indeed, all the a utomakers you've mentioned have adopted the Horizon Robotics for their Highway NOA solutions and we are the only s olution provider from China for these automakers. The full demo, Horizon Robotics is either the only solution p rovider or one of the two solution providers and the timeline for the vehicle l aunches may be different in this year. Like BYD has already launched their vehicles with the Highway NOA solutions under the automaker, might have the launches in May. It is difficult for us to f orecast the market share at the current stage. However, if we look at the long r un and we believe a market share o f over 50% is a reasonable goal. We will spare no efforts to a chieve even higher market share. Thank you. [Foreign language] [Foreign language] The next question comes from Ming Chung with Citigroup. Please go ahead. [Foreign language] T hank you for the opportunity for me to raise the questions. My first question is about the 2025 shipment volume growth pace forecast guidance and the average blended ASP guidance. If possible, could you give up more details and breakdown on the different chips on solutions, for example the J6B, J 6E and J 6P and J6M solution. Thank you very much. [Foreign language] Thank you very much for your question and we expect in 2025 the delivery volume growth will remain very high w ith a change in our product mix in the delivery volume. First of all, a significant proportion of our delivery in 2024 was the Mono S eries solutions serving the basic L2 ADAS applications which accounted for the majority of our volume in 2024, and with the democratization of smart driving, some of these will be upgraded to the Highway NOA s mart driving products and even to the Urban NOA solutions which will be our Journey 6E and 6P for the Urban NOA. We believe that this democratization of smart driving will not only bring incremental growth but also upgrading of the existing delivery products. In terms of the ASP, the G2, G3 is about several dozen USD and G5 is around $100. J6M and J6E is about $100, which is a lso an engine-level product and the J6P is several $100. In Q3, J6P will be delivered to the customers. You can see the ASP is improving obviously along the time. Our delivery volume also hopefully delivers oneJ 6E and J6 M. In the next year, the J6 series will be the m ajority of our delivery volume and we can see the penetration rate of smart driving in China's passenger vehicle sector last y ear has changed, achieved 65%, significantly higher t han the penetration rate of the new energy vehicles. We believe that the volume growth of t he industry in 2025 is expected to be moderate. The industry has achieved a stage where further progress will be challenging and we b elieve our growth in the delivered volume w ill be largely driven by the higher m arket share of Horizon Robotics among the a utomakers multiplied by higher ASP. The increase of ASP is a natural result of the volume growth of Highway NOA under the deployment of Urban NOA solutions. We believe the delivery volume of g rowth will remain at a high speed with the AD solutions contributing at least f or about 1-2 million units. The ASP will keep rising as I've mentioned before. From ADAS to Highway NOA, the ASP will increase by several times. Again, from Highway to Urban NOA, the ASP will increase by several times again. We have our HSD in w hich we bundle the software and hardware capabilities t he selling price will also take another step further up, further driving the SP over Horizon Robotics. Thank you very much. [Foreign language] My question is about level three development progress at the industry level. We recognize many automakers are planning to launch level 3 autonomous- driven cars in the second half with amazing features and setup potentially. My question is which months or quarters in the second half you think that the industry will enter into an inflection point to commercialize this and crystallize this into revenue? Or it is just a lot of talks but no action yet. Thank you. [Foreign language] Yes indeed, the automakers have announced clearly or implicitly that they will launch these v ehicles with L3 features and functionalities. And maybe by the end of this year t hey will claim that their vehicles can achieve L3 smart driving experiences. We also need to wait for the government approval to consolidate the legitimacy of L3 autonomous. It depends on the market, competition, landscape plus the maturity of technology and regulation. Maybe by the end of this y ear or next year, we will see the launch of the L3 vehicles, no matter commercially or the regulation levels to be launched to the market. In terms of the Chinese government, the attitude is quite proactive in promoting the commercialization of L3. We have seen nine automakers being a pproved for the road testing. Some cities have also launched the pilot programs allowing L3 to be activated i n the restricted areas. Technically, we believe that the technology roadmap for L3 in China will take L2++ as the foundation and continuously expand the ODD of autonomous driving and incorporate the hardware and software redundancy design to reduce thermal failure, improve redundancy to achieve L3. This is good news for companies like us because we can achieve a higher fail per vehicle and we have the capability of hardware plus software and to launch the vehicles with the L3 functionality. We believe that the HSD of Horizon Robotics will be a very crucial step. This will further drive the ASP of Horizon Robotics. We believe the timing is very similar to the last 90s. In the era of PC we have seen a very fast upgrade and integration f rom iteration from the 286,386 to 586 t o 1003.0109598 in a very short period of time. We have seen this very fast iteration in auto sector as well. We believe this is the very ideal market environment for companies like us to grow. Thank you very much. This is my answer to your question. As we're reaching the end of our conference call now, I'd like to turn the call back over to the company for closing remarks. Due to time constraints, we'll now conclude today's call. Thank you again for joining us today. If you have any other questions, please feel free to contact the IRG. Thank you. This concludes today's call. Thank you for joining. You may now disconnect your line.