Good morning and good evening, ladies and gentlemen. Thank you for standing by, and welcome to the ATRenew Incorporated 4Q full year 2022 earnings conference call. At this time, all participants are in a listen only mode. We will be hosting a question and answer session after management's prepared remarks. Please note today's event is being recorded. I would now like to turn the call over to the first speaker today, Mr. Jeremy Ji, Director of Corporate Development and Investor Relations of the company. Please go ahead, sir. Thank you. Hello, everyone, and welcome to ATRenew's 4Q and full year 2022 earnings conference call. Speaking first today is Kerry Chen, our Founder, Chairman, and CEO. He'll be followed by Rex Chen, our CFO. After that, we'll open the call to questions from analysts. The financial results were released earlier today. The earning release and investor slides accompanying this call are available at our IR website. There will also be a transcript following this call for your convenience. For today's agenda, Kerry will share his thoughts of our quarterly performance and business strategy, followed by Rex, who will address the financial highlights. Both Kerry and Rex will join the Q&A session. Let me cover safe harbor statements. Some of the information you will hear during our discussion today will consist of forward-looking statements. I refer you to our safe harbor statements in the earnings press release. Any forward-looking statements that management makes on this call are based on assumptions as of today, and that ATRenew does not take any obligations to upgrade our assumptions on these statements. This call includes discussions of certain non-GAAP financial measures. Please refer to our earnings release, which contains a reconciliation of non-GAAP measures to GAAP measures. Please note that unless otherwise stated, all figures mentioned during this conference call are in RMB and all comparisons are on a year-over-year basis. I'd now like to turn the call over to Kerry for business and strategy updates. Hello, everyone, and welcome to ATRenew's 4Q and full year 2022 earnings conference call. COVID infections surged rapidly, especially in December, following the easing of pandemic controls. This posed a severe challenge to us in Beijing and Shanghai, et cetera, which contributed a significant proportion of our business. At the same time, production shortfalls meant that the popular models of the iPhone 14 lineup were in short supply, negatively affecting our trading business. To meet these challenges, we put every effort into maintaining store operating hours and ensuring the supply of 1P self- sourced products. Thanks to our team's efforts, we met our goals for revenue and profit during the quarter. Starting with revenues. During the 4Q, our revenue reached a new record high of RMB 2.98 billion, representing a year-over-year growth of 22.4%, and arriving in the middle of our guidance range. In 2022, our total revenue reached RMB 9.87 billion, increasing by 26.9% year on year. This was mainly driven by our focus on 1P business, which grew by 30.4% during 2022. Facing slower consumption growth and the resurgence of COVID-19 in 2022, we were more prudent in opening new stores and kept strengthening product sourcing capabilities by improving store management. In addition, implementing our city-level service integration strategy laid the foundation for the healthy growth of 1P business. The integration of frontline sourcing capabilities of three business lines facilitates efficient sourcing and transaction flow. Even in the 4Q, despite facing severe pandemic-related challenges, we grew the penetration rate of major cities in which we already operate at scale, such as Hangzhou, Nanjing, Suzhou, and Xian. 平 台 业 务 方 面 ， 我 们 从 IPO 时 强 调 的 规 模 增 长 优 先 调 整 为 效 率 优 先 ， 稳 健 增 长 。 基 于 更 好 的 供 应 链 服 务 能 力 ， 平 台 的 综 合 收 费 率 回 升 到 百 分 之 四 点 八 的 水 平 ， 其 中 拍 即 堂 在 商 家 结 构 优 化 后 ， 核 心 业 务 的 收 费 率 提 升 到 百 分 之 六 点 九 。 商 家 的 高 粘 性 再 次 证 明 了 拍 即 堂 平 台 的 价 值 。 拍 拍 业 务 在 四 季 度 的 物 流 妥 投 受 疫 情 阻 碍 等 影 响 ， 因 此 呢 B2C 的 收 费 率 略 有 回 落 。 但 是 我 们 预 期 在 2023 年 通 过 品 类 和 运 营 的 优 化 会 快 速 的 恢 复 。 从 我 们 提 出 1P 业 务 作 为 主 要 的 增 长 引 擎 后 ， 平 台 业 务 更 加 注 重 效 率 优 化 ， 已 经 度 过 了 亏 损 阶 段 。 拍 拍 和 拍 即 堂 的 平 台 业 务 已 经 ， 呃 ， 均 已 实 现 运 营 盈 利 。 Regarding marketplaces, we have pivoted from our IPO year strategy of scale first to efficiency first with steady growth. Driven by enhanced supply chain capabilities, the overall take rate of our marketplaces rebounded to 4.8%. To break this down, following the optimization of PJT Marketplace merchant structure, the take rate for the core services increased to 6.9%, demonstrating merchant users trusting us and the value of the PJT Marketplace. For Paipai, fulfillment was hindered by the pandemic, leading to a slight decline in B2C take rate. We expect this to rapidly return to a healthy level following category and operation optimizations during 2023. Since we set 1P business as the main growth engine, third party business prioritized efficiency optimization. These platform businesses, including Paipai and Paijitang marketplaces, have realized non-GAAP operating profit. 效 率 方 面 ， 2022 年 我 们 强 化 运 营 ， 细 抠 每 一 分 钱 。Non-GAAP 口 径 下 ， 我 们 在 2022 年 实 现 了 成 本 效 率 的 提 升 ， 尤 其 是 销 售 费 用 率 和 履 约 费 用 率 分 别 控 制 在 8.9% 和 10.9% 。 销 售 费 用 率 的 优 化 主 要 得 益 于 我 们 节 约 了 拍机堂 平 台 推 广 费 、 商 家 返 利 、 地 推 团 队 的 成 本 ， 以 及 对 于 新 业 务 更 加 有 纪 律 的 投 入 。 Turning to operating efficiency. During 2022, we enhanced our operations and were highly disciplined with our spending. Under non-GAAP measures, we improved our cost efficiency. In particular, selling and marketing expenses and fulfillment expenses as percentages of total net revenue further decreased to 8.9% and 10.9% respectively. We achieved selling and marketing expenses optimization mainly by reducing PJT Marketplace's promotional fees and rebates for merchants, underground marketing fees and by prudently investing in new initiatives. 履 约 费 用 率 是 我 们 长 期 优 化 的 重 点 。 回 顾 过 去 三 年 ， 我 们 通 过 自 动 化 项 目 逐 步 在 华 东 、 华 南 等 大 仓 的 ， 实 现 了 质 检 、 订 级 流 程 的 自 动 化 ， 大 幅 提 升 了 仓 储 的 物 流 效 率 ， 并 且 通 过 管 理 系 统 提 升 了 全 国 门 店 的 回 收 交 付 流 程 的 标 准 化 ， 成 功 将 non-GAAP 的 履 约 费 用 率 从 2020 年 的 13.7% 降 低 到 2021 年 的 12.9% ， 并 在 2022 年 Q4 进 一 步 降 低 到 了 10.9% 。 这 证 明 我 们 坚 持 投 入 自 动 化 技 术 的 战 略 是 正 确 的 ， 我 们 业 务 模 式 的 盈 利 是 可 实 现 的 。 第 四 季 度 ， 我 们 第 二 代 的 自 动 化 运 营 中 心 在 东 莞 开 仓 运 营 ， 进 一 步 地 提 升 了 质 检 效 率 ， 将 质 检 失 误 导 致 的 损 失 同 比 降 低 了 22% 。 随 着 经 济 生 活 回 归 常 态 ， 我 们 又 有 信 心 看 到 交 易 量 回 升 ， 自 动 化 技 术 规 模 化 效 应 的 经 济 效 益 将 逐 步 释 放 。 Fulfillment expense optimization is our long-term focus. Over the past three years, we have gradually automated quality inspection and pricing at our operation centers in South and East China, thereby enhancing the efficiency of warehousing and logistics. In addition, the upgraded management system has improved the standardization of recycling and fulfillment at our storefronts. As a result, non-GAAP fulfillment expenses as a percentage of the total net revenues decreased to 10.9% in 2022 from 13.7% in 2020 and 12.9% in 2021. Such improvements validate our commitment to strategic investments in automation and demonstrate the profitability of our business model. During the 4Q, our second-generation automated facility came online in Dongguan, further boosting inspection efficiency. As a result, losses caused by quality inspection failures decreased by 22% compared with the same period of 2021. As people's daily lives and the economy return to normal, we are confident in a revitalizing transaction activity, and we expect the benefits from automation to further scale. 在 处 置 端 ， 我 们 持 续 加 强 标 准 和 价 格 体 系 的 建 设 ， 并 且 通 过 开 展 合 规 的 翻 新 业 务 ， 提 升 自 营 回 收 商 品 的 质 量 等 级 ， 持 续 提 升 适 合 TOC 零 售 货 源 的 比 例 ， 并 且 通 过 产 业 链 增 值 额 外 延 伸 ， 延 伸 额 外 的 毛 利 空 间. 2022 年 下 半 年 ， 整 体 的 合 规 翻 新 手 机 产 品 的 销 售 规 模 突 破 了 RMB 220 million. On processing, we continue enhancing our grading and pricing system while providing compliant refurbishment services at a larger scale. We would recondition a larger part of sell forward devices and this in turn help to increase the proportion of like-new products that are suitable for retailing. Moreover, this value-added service will enable us to gain extra gross margin along the value chain. During the second half of 2022, our compliant refurbishing business achieved a GMV of over RMB 220 million. 在 Non-GAAP 的 口 径 下 ， 我 们 在 四 季 度 实 现 了 近 三 千 四 百 六 十 万 元 人 民 币 的 运 营 利 润 ， 全 年 盈 利 六 百 九 十 万 元 人 民 币 ， 包 含 现 金 及 现 金 等 价 物 、 短 期 投 资 、 第 三 方 支 付 上 获 得 余 额 等 综 合 现 金 储 备 共 二 十 八 亿 元 人 民 币 。 此 外 ， 凭 借 我 们 坚 定 、 清 晰 坚 定 的 长 期 战 略 ， 我 们 对 于 二 零 二 三 ， 二 零 二 三 年 的 一 季 度 以 及 全 年 的 运 营 盈 利 目 标 充 满 信 心 。 Under the Non-GAAP measures, we achieved an operating income of RMB 34.6 million in the 4Q and reported an operating income of RMB 6.9 million for the whole year, with a strong cash position of RMB 2.8 billion, which included cash and cash equivalents, short-term investments and funds receivable from third-party service providers. Along with a clear firm long-term strategy, we are fully confident in our Non-GAAP operating profitability targets for the 1Q and full year 2023. 接 下 来 让 我 再 次 强 调 一 下 我 们 的 核 心 战 略 。 我 们 曾 连 续 在 过 往 的 财 报 电 话 会 中 提 出 ， 我 们 的 战 略 是 坚 定 不 动 摇 地 在 长 期 执 行 中 逐 渐 有 成 效 。 第 一 。 Now let me once again emphasize our core strategies. We have mentioned over the past few quarters, we remain resolute in executing our productive strategies. 第 一 ， 通 过 城 市 一 体 化 战 略 ， 促 进 更 多 消 费 者 认 识 回 收 ， 参 与 回 收 ， 促 进 合 作 伙 伴 和 商 家 更 简 单 地 开 展 以 旧 换 新 。 据 CIC 的 报 告 ， 中 国 消 费 电 子 产 品 的 回 收 渗 透 率 仍 然 处 于 低 个 位 数 ， 约 4%-5% 。 万 物 回 收 施 展 的 空 间 依 然 很 大 。 我 们 的 目 标 是 率 先 在 一 线 城 市 突 破 15% 以 上 的 回 收 渗 透 ， 回 收 服 务 渗 透 率 ， 综 合 提 升 全 国 大 盘 的 渗 透 水 平 。 值 得 一 提 的 是 ， 今 年 年 初 我 们 已 经 和 全 球 领 先 的 手 机 消 费 电 子 品 牌 达 成 了 以 旧 换 新 的 战 略 合 作 ， 预 计 在 今 年 的 Q3 的 新 机 销 售 旺 季 能 够 给 公 司 业 务 带 来 额 外 的 有 效 增 长 。 First, our city-level service integration strategy has provided opportunities for a wider range of consumers to acknowledge and participate in recycling, while simplifying how our partners and merchant users carry out trading services. According to a CIC report, the penetration rate of consumer electronics recycling in China remains low at 4%-5%, indicating an extensive addressable market for us. Our target is to first achieve an over 15% recycling penetration rate in top-tier cities while elevating the national average. As a highlight, we have established strategic partnerships with world leading smartphone manufacturers in terms of trading programs this year, and we expect this to effectively benefit our business during the peak season of new phone sales in the third quarter. 第 二 点 ， 持 续 加 强 合 规 翻 新 的 整 备 能 力 ， 更 多 的 比 例 通 过 Paipai B2C 业 务 直 接 零 售 ， 实 现 更 完 整 的 价 值 链 ， 实 现 更 多 的 增 值 利 润 空 间 ， 也 更 好 地 服 务 消 费 者 ， 让 购 买 二 手 合 规 翻 新 整 备 产 品 的 体 验 与 购 买 新 品 一 样 ， 同 样 有 质 量 保 证 ， 但 更 加 经 济 实 惠 。 Second, we continue advancing our compliant refurbishment capabilities, maximizing our value chain and profit margins through more 1P2C retail distribution while we improve customer service. For refurbished products, we provide new product shopping experience and the same quality assurance but at more affordable prices. 第 3 点, 多 品 类 回 收. 进 一 步 放 大 爱 回 收 的 品 牌 价 值, 通 过 门 店 形 象 和 服 务 能 力 的 升 级, 承 接 用 户 更 多 品 类 回 收 的 需 求, 为 集 团 的 业 务 增 加 新 的 发 展 点, 提 升 现 有 门 店 的 效 和 运 营 利 润. 在 循 环 经 济 发 展 的 大 背 景 下, 鼓 励 更 多 的 用 户 参 与 回 收 和 绿 色 生 活 方 式, 让 有 价 值 的 产品 的 生 命 周 期 得 以 延 续, 践 行 让 闲 置 不 用 都 物 尽 其 用 的 企 业 使 命. Third, we will further amplify the brand value of AHS Recycle across multiple new categories. By upgrading our storefront, elevating our service capabilities, and meeting a more diverse demand, we are adding new growth drivers for our business and improving the unit economics and margin of existing stores. Against the backdrop of the development of the circular economy, we encourage a greener lifestyle of recycle and reuse. By doing so, our mission to give a second life to all idle goods comes to fruition. 第 四 点 ， 逐 步 实 现 自 动 化 的 替 代 。 我 们 相 信 自 动 化 的 研 发 已 经 度 过 了 研 发 阶 段 ， 进 入 到 了 项 目 实 施 和 成 本 效 益 释 放 的 阶 段 。 我 们 会 基 于 平 台 处 置 规 模 的 提 升 ， 逐 步 对 于 其 余 六 个 运 营 中 心 进 行 自 动 化 的 升 级 ， 实 现 高 精 度 的 质 检 和 拣 选 机 器 人 对 人 工 操 作 的 替 代 ， 进 一 步 降 低 运 营 成 本 。 Finally, we will continue the steady automation of our supply chain. We have completed the R&D stages and are delivering positive cost savings results following the initial implementation. As device volume increases, we will gradually automize the six remaining operation centers, replacing manual inspection to realize high precision quality control and improve cost efficiency. 万 物 新 生 处 在 循 环 经 济 长 期 且 充 满 机 遇 的 绿 色 赛 道 。 我 们 相 信 供 应 链 和 技 术 驱 动 效 率 革 新 的 力 量 ， 坚 持 把 回 收 这 一 件 事 情 做 好 ， 让 闲 置 不 用 都 物 尽 其 用 ， 做 多 品 类 ， 做 大 规 模 ， 做 坚 实 的 利 润 ， 为 用 户 、 为 环 境 、 为 股 东 带 来 更 多 的 价 值 创 造 。 The ongoing development of the circular economy provides us with a wide range of opportunities. We strongly believe in supply chain and technology as driving forces to realize efficiency advancement. Looking ahead, our mission to give a second life to all idle goods remains unchanged, and we stay dedicated to the recycling business. We will go further in product categories and we'll further scale. We will generate high quality process and greater [uncertain] for users, the environment and shareholders. 下 面 请 公 司 的 CFO Rex 介 绍 一 下 公 司 的 财 务 情 况 。 I will hand the call over to Rex, our CFO, to go over the financials. Hello, everyone. We're pleased to report that our 1Q revenue was in line with our guidance, even though COVID-19 related challenges continued to impact operating environment. In the face of these headwinds, we leveraged our strong supply chain capabilities to maintain a stable product source supply and further certified the healthy growth of our 1P businesses. I will start by sharing some of our financial highlights before we go into a more detailed look at the numbers. Please note that all amounts are in RMB and our comparisons are on a year-over-year basis unless otherwise stated. Total net revenues increased by 22.4% year-over-year to RMB 2,981.2 million, mainly driven by growth in net products revenues. In terms of profitability, we had another profit-making quarter with a GAAP operating income of RMB 34.6 million. This was primarily attributable to improved cost efficiencies in logistics and in main parts that resulted from scale effects powered by automation inspection up-upgrade. This was also attributable to improved cost efficiencies in optimized promotional and advertising strategies for our marketplaces. Facing the challenges brought by the pandemic, we made some short-term operational adjustments that resulted in a temporary decrease in our fulfilled costs this quarter. We leveraged the sources of supply of industry partners to ensure ample quality product listings. Also, the gross margin of the batch was seen. We didn't have to invest heavily into inspection and grading. This was considered as a trade-off. During 2022, our cost strategies and tactical flexibility safeguarded us from market volatilities, and we are pleased to report a non-GAAP operating break-even milestone, as well as RMB 881 million positive cash flow from operating activities in 2022. In the future, we expect the diverse impacts of COVID-19 variants to fade away and our sourcing as well as fulfillment functions to recover. We will continue to improve our cost efficiency, leverage our automated inspection facilities to further realize scale effects, and accurately capture the cycling shopping scenarios. We expect to further improve our non-GAAP operating margins in the coming years. Now let's take a detailed look at the financials. In the 1Q, total revenues increased by 22.4% to RMB 2,981.2 million. Net product revenues increased by 29.5% to RMB 2,687.9 million, while net service revenues decreased by 18.5% to RMB 293.3 million. Growth in net product revenues was primarily driven by an increase in sales of pre-owned consumer electronics through our offline channels in mainland China and overseas markets and the Paipai Marketplace. The decrease in service revenues was primarily due to the lessened consignment business of Paipai Marketplace as we shifted our strategy focus to prioritize 1P2C sales, while we further ramp up our compliant refurbishing business. We prioritized scale growth with stable profit and eliminated some businesses with low take rates of PJT Marketplace. The overall commission rate for our marketplaces rebounded to 4.8% during the 1Q. Next, turning to our operating expenses to provide greater clarity on the trends in our actual operating based expenses. We will also discuss our non-GAAP operating expenses, which better reflect how the management views our results of our operations. The reconciliations of GAAP and non-GAAP results are available in our earnings release and the corresponding Form 6-K furnished with SEC. Merchandise costs increased by 31.7% to RMB 2,370.5 million. This was in line with the growth in product sales revenues. Gross margin at the group level was 20.5% in the 1Q. Gross margin for our 1P business was 11.8%. Fulfillment expenses decreased by 5.2% to RMB 274.9 million, excluding share-based compensation expenses, which we will refer to as SBC from here on. Non-GAAP fulfillment expenses decreased by 7.3% to RMB 259.3 million. Under the non-GAAP measures, the decrease was primarily due to a decline in operation center-related expenses as we optimized our strategy for city level operation stations and the Paipai Selection stores, as well as a decrease in logistics expenses. Non-GAAP fulfillment expenses as a percentage of total revenues decreased to 8.7% from 11.5% in the same period last year. Selling and marketing expenses increased by 61.1% to RMB 594 million, excluding SBC expenses and amortization and impairment loss of intangible assets. Non-GAAP selling and marketing expenses decreased by 18.3% to RMB 222.1 million. Under non-GAAP measures, the decrease was primarily due to decreased marketing expenses in relation to our more prudent spending strategy for our marketplaces. Non-GAAP selling and marketing expenses as a percentage of total revenues decreased to 7.5% from 11.2% in the same period last year. G&A expenses increased by 47.6% to $76.6 million, excluding SBC expenses. Non-GAAP G&A expenses increased by 66.3% to $54.7 million, primarily due to an increase in professional service fees. Non-GAAP G&A expenses as a percentage of total revenues slightly increased to 1.8% from 1.4% compared with the same period last year. Technology and content expenses decreased by 12.1% to $54.5 million, excluding SBC expenses and amortization and impairment loss of intangible assets. non-GAAP G&A expenses decreased by 26.6% to $38.7 million, primarily due to a decrease in personnel costs in relation to our adjustments to spending in research and development. non-GAAP G&A expenses as a percentage of total revenues decreased to 1.3% from 2.2% compared with the same period last year. As a result, our non-GAAP operating income was $34.6 million in the 1Q of 2022. non-GAAP operating margin was 1.2% compared with 0.4% in the same period last year. As of December 31, 2022, cash and cash equivalents, short-term investments, and funds receivable from third-party payment service providers totaled $2.8 billion. Our sufficient cash on hand safeguards a sustainable growth outlook. Considering negative impacts on market demands resulting from the outbreak of COVID-19 pandemic and the changes in market conditions, the company performed quantitative impairment tests on the goodwill and intangible assets and recognized impairment losses of $1,819.9 million and $206.9 million on goodwill and intangible assets, respectively, for the period ended December 31, 2022. I recap, on December 9, 2022, we announced an extension of our existing $100 million share repurchase program for another 12-month period starting from December 28, 2022. Based on management's strong confidence in the company's solid fundamentals and the growth momentum. During the 1Q of 2022, we repurchased 383,304 ADSs in the open market for a total cash consideration of $0.9 million. At the end of 2022, we repurchased a total of 8.5 million ADSs for approximately $33.9 million under our share repurchase program. Now turning to outlook. For the 1Q of 2023, the company currently expects its total revenues to be between RMB 2,770 million and RMB 2,870 million due to the seasonality of our business. During 2023, we expect the negative impact from COVID-19 variants to fade out and anticipated a full year operating income under the Non-GAAP measures. This forecast only reflects our current and preliminary views on the market and operational conditions, which are subject to change. This concludes our prepared remarks for today. Operator, we are now ready to take questions. Thank you. We will now begin the question and answer session. To ask a question, you may press star then one on your touch-tone phone. If you're using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then two. When asking the question, please state your question in Chinese first, then repeat your question in English for the convenience of everyone in the call. At this time, we'll pause momentarily to assemble our roster. Our first question comes from Ronald Keung from Goldman Sachs. Please go ahead. Hey. Thank you, management. I wanna ask about two questions about growth. One is for the overall industry, how are we seeing the long-term industry and growth opportunity, particularly after the COVID impact, for this year? Should we expect an acceleration in growth? Second is about your category expansion. Could you share a bit more on how this is progressing in your expanding of categories? Thank you. Oh, thank you. 或 者 没 有 接 触 到 体 验 好 ， 价 格 好 的 回 收 服 务 。 因 此 ， 我 们 的 增 长 策 略 是 增 加 有 效 的 场 景 覆 盖 ， 抓 到 更 多 的 回 收 和 以 旧 换 新 的 机 会 。 Thank you for the question. In our view, the supply-driven industry remains unchanged, and sourcing is of vital importance. Many users are unfamiliar with recycling services or may not have had satisfying recycling experiences with good pricing yet. Our growth strategy for recycling and trading is to cover more efficient conversion scenarios. 一 方 面 呢 ， 我 们 围 绕 我 们 的 这 个 根 据 地 啊 ， 爱 回 收 的 门 店 ， 我 们 保 持 有 节 奏 的 这 个 开 城 和 拓 店 ， 并 且 升 级 现 有 门 店 的 用 户 体 验 ， 增 加 更 多 的 回 收 品 类 。 这 些 都 会 增 加 用 户 对 于 回 收 服 务 的 认 知 ， 产 生 更 多 的 回 收 复 购 ， 提 升 爱 回 收 门 店 运 营 和 后 端 质 检 中 心 的 效 率 。 另 外 一 方 面 呢 ， 我 们 新 增 优 质 的 主 力 的 这 个 回 收 场 景 ， 持 续 和 领 先 的 电 商 平 台 ， 头 部 的 手 机 ，3C 品 牌 加 强 合 作 。 在 稀 缺 的 客 流 量 集 中 的 购 新 的 场 景 ， 提 供 回 收 和 以 旧 换 新 的 服 务 。 我 们 相 信 回 收 的 服 务 渗 透 率 的 提 升 空 间 依 然 ， 依 然 显 著 ， 有 很 大 的 空 间 。 On one hand, we have continued developing our AHS offline stores, which are the foundation of our business. We open new stores and cities at suitable pace while enhancing user experience at existing stores. We have also been expanding the category coverage of our recycling business. As a result, we have grown user awareness of our recycling services and generated more repurchases. Our strategy has improved efficiency in both store form and backend quality inspection centers. On the other hand, we have developed new recycling scenarios that have provided significant contributions to our business growth. We continue to enhance our collaborations with industry leading e-commerce players and top consumer electronics brands. Through these collaborations, we provide recycling and trading services in scenarios where user traffic is highly concentrated on new product purchases. With these, there is still great potential for us to further penetrate China's market. 关 于 增 长 的 趋 势 。 随 着 疫 情 防 控 政 策 的 调 整 ， 经 济 的 复 苏 ， 我 们 在 2023 年 春 节 前 后 看 到 回 收 端 的 交 易 回 暖 。 越 来 越 多 的 用 户 愿 意 走 出 家 门 ， 来 到 商 场 里 爱 回 收 的 门 店 ， 回 收 家 里 闲 置 但 仍 然 有 一 定 价 值 的 物 品 。 因 此 呢 ， 我 们 也 延 续 了 春 节 不 打 烊 的 这 个 活 动 ， 满 足 用 户 节 假 日 期 间 的 回 收 需 求 。 春 节 期 间 的 这 个 回 收 单 量 有 显 著 的 同 比 增 长 。 在 购 买 端 ， 我 们 相 信 用 户 对 于 低 价 优 质 商 品 的 追 求 是 符 合 零 售 本 质 的 规 律 的 。 而 我 们 看 到 用 户 在 经 济 复 苏 下 行 阶 段 的 支 出 仍 然 偏 谨 慎 。 有 供 应 链 质 量 保 障 的 二 手 商 品 是 重 要 的 选 项 。 我 们 也 在 重 点 提 升 自 身 产 业 链 能 力 和 价 值 ， 精 准 筛 选 适 合 合 规 翻 新 的 货 源 ， 加 强 自 营 货 源 的 整 备 翻 新 ， 提 升 TC 零 售 的 比 例 ， 为 消 费 者 带 来 更 具 性 价 比 、 更 有 品 质 保 障 的 购 买 方 案 。 总 的 来 说 ， 我 们 对 于 一 季 度 以 及 全 年 的 业 务 增 长 以 及 利 润 达 成 充 满 信 心 。 In terms of growth trajectory, we observed several changes prior to and after the spring festival as pandemic restrictions were lifted and the economy began to revitalize. First of all, more consumers were willing to go out and visit our stores and shopping malls to sell their idle goods with residual value. We continued our uninterrupted services during the holiday and to meet the rebounding demand. During the seven-day holiday, recycling volume had a significant year-over-year increase. Second, we believe high quality products at low prices is the natural and reasonable pursuit of consumers. Consumer spending is still cautiously recovering. Pre-owned products with quality assurance backed by strong supply chain capability are essential options. We are also improving our operating capabilities and maximizing our value chain. Our goal is to precisely select source goods that are suitable for compliant refurbishment and enhance self-operated sourcing into consumer sales, thus bringing consumers quality assured value for money options. In a nutshell, we are confident that the 1Q and full year growth trajectory will be delightful, and we will expect a profit, profitable quarters in the coming years. 关 于 多 品 类 的 问 题 。 十 二 年 前 ， 我 们 从 二 手 手 机 切 入 ， 在 发 展 中 看 到 了 循 环 消 费 是 一 个 大 的 趋 势 ， 我 们 的 边 界 也 可 以 更 大 。 越 来 越 多 的 用 户 愿 意 将 手 ， 家 里 面 有 价 值 的 东 西 回 收 变 现 。 不 只 是 二 手 手 机 ，3C， 还 有 箱 包 、 腕 表 、 名 酒 、 黄 金 首 饰 等 。 我 们 之 前 成 功 解 决 了 二 手 手 机 3C 行 业 的 服 务 标 ， 服 务 品 质 、 质 检 标 准 化 、 定 价 等 问 题 。 同 样 ， 我 们 也 有 抱 负 去 解 决 多 品 类 回 收 的 服 务 体 验 差 、 质 检 标 准 参 差 不 齐 、 回 收 高 度 分 散 等 问 题 。 Let me now turn to our multi-category recycling business. 12 years ago, we started recycling pre-owned mobile phones and saw the huge potential in the circular economy as our business grew. We believe that our business scope can be expanded. A growing number of users are willing to sell their valuable goods for cash, and this is beyond consumer electronics. A growing demand is coming from luxury bags, watches, prestigious liquor, gold and jewelry. We have successfully solved problems regarding service quality, inspection, standardization, and pricing that had plagued the pre-owned electronics industry. We also have the ambition to tackle the problems of these categories, such as poor user experience, inconsistent quality standards, and highly fragmented recycling channels. In order to achieve future success, we have strategically developed our multi-category recycling business and upgraded our slogan to Recycle More For You, which endows the brand with more love and care. It also demonstrates our goal of realizing more standardized service and pricing system for non-standard recycling. During the 4Q, we selected the top performing stores in higher tier cities from over 1,000 AHS store across the country to pilot the above mentioned high ASC categories, followed by clothing, footwear, and gift cards, among others. From January to February this year, the new category business has not only achieved breakeven, but also surpassed RMB 50 million in monthly GMV with strong growth momentum. By the end of June, we plan to allocate the new category recycling offerings across 150 tier- 1 stores and upgrade the brand image of these stores. We will also further enhance the overall fundamental capabilities. These enhancements include diversifying the product database, optimizing pricing strategies, increasing the conversion rate at every stage of the recycling process, and enhancing the distribution channels. Putting user experience first will be our long-lasting principle, and we will continue to improve our service capabilities in offline stores, making them our fundamental capabilities in the high value non-standard products recycling business. Okay. Thank you for the question. Oh, thank you. The next question comes from Joyce Zhu from Bank of America. Please go ahead. I will translate my question. Actually, we have seen this quarter and even for the full year, that the company actually achieved a non-GAAP profitability, which is pretty remarkable compared to last year's loss. Just want to understand, like, you know, how management looking at in the future, what's the key source of our profit and how should we look at our profitability sustainability? Thanks. Thanks, Joyce. I will take this question. During the second half of 2022, we adjusted our revenue mix and the profit strategy by prioritizing the high quality controllable 1P business. We also pivoted from consignment business to 1P2C retailing by leveraging our compliant refurbishing capabilities. This is expected to generate scaled 1P2C sales and gross profit in the long run. In addition, we optimized our sales and marketing spending in the marketplaces and improved the fulfillment of spending efficiency as we further advanced our automated inspection capabilities. As a result, we successfully realized our profit targets in 2022. In our last earning call, we explained the details of the compliant refurbishment policy and the logic of the overall refurbishment business. By polishing device screens and replacing batteries and screens with certified third-party parts and components, we improve the functionality of pre-owned products. We also inform customers how we have refurbished devices, offer 7-day free return and 1-year quality warranties. During the 4Q, we elevated the overall capabilities of our South China operation centers team and the production capabilities increased as planned. As a result, total sales of compliant refurbished phones surpassed RMB 220 million in the second half of 2022. Meanwhile, we further improved supply for our self-operated business by simplifying the screening process and more precisely locating devices suitable for compliant refurbishment. ASP for 1PG C products increased to RMB 2,700. By enhancing our operating efficiency and product quality, we further expanded our operating margin. Looking ahead to this year, we're going to implement these same improvements at our East China and North China operating centers. We expect to complete our supply chain upgrades for tablets as we test our new categories for our recycling business. Our goal is to provide retail users with more cost-efficient, high-quality products. In the full year of 2023, we expect our compliant refurbishments business to generate revenues of RMB 600 million, with an additional margin of 5%. We encourage you to focus more on our non-GAAP operating margin. In the 1Q, we realized RMB 34.6 million in non-GAAP operating profit and achieved non-GAAP operating profit for the full year. This is mainly due to our long-term investment and large-scale implementation of automated quality inspection, stocking, and pricing technology. As a result, fulfillment efficiency have improved significantly. We also adjusted our strategy for our operating stations, reducing costs that had arisen from fragmented dispatching and logistics. As a result, our non-GAAP fulfillment expenses as a percentage of revenue decreased from 13.7% in 2020 to 12.9% in 2021, further dropped to 10.9% in 2022. We also remained prudent in our marketing efforts. By refining our operations, we strive to achieve greater organic growth for each of our business lines. Thank you. Many thanks. Our next question comes from Fay Lin from China Renaissance. Please go ahead. Thanks management for taking my question. We noticed that non-GAAP sales and marketing expense as percentage of revenue was lower to 7.5%, in the 4Q. Just wondering, can management elaborate more on the measures taken to improve efficiency behind? Thanks. Thank you. In the last year, we have been prudent with our selling and marketing expenses and the related personnel costs. Apart from the marketing budget used to develop consumer mindshare of AHS Recycle, our assessment for each business line prioritized ROI. For PJT Marketplace, we optimized its frontline marketing team. For Paipai Marketplace, we prioritized profitability. They were more focused on its brand image and reputation. We also reduced subsidies provided on JD dot com and our investments in user traffic of new channels. In the 4Q, excluding SBC expenses and amortization of and impairment loss of intangible assets, non-GAAP selling and marketing expenses were RMB 222 million. That accounted for 7.5% of total revenue, down by 3.9 percentage points from 11.2% in the same period of 2021. We believe the non-GAAP measures reflect a better picture of our expenses. Thank you. Thanks. Again, if you have a question, please press star then one. As there are no further questions at this time, I'd like to hand the conference back to our management for closing remarks. Thank you. Thank you all again for joining us. A replay of today's call will be available on our IR website shortly, followed by a transcript when ready. If you have any additional questions, please feel free to email us at ir@atrenew.com. Have a good day. The conference has now concluded. Thank you for attending today's call.