Jenny Xu

Jenny Xu asked for management's perspective on the potential for improving the profitability of the aesthetic center business in the future.

Answer

CEO Xing Jin, as translated by company representative Mona Qiao, stated that the immediate priority is user base expansion, with profitability expected to improve as the business scales and the operating model matures. On the cost side, the company optimizes customer acquisition channels and expects significant reductions in consumable costs, partly due to product upgrades like Miracle PLLA 3.0. Digitalization, AI, and economies of scale are anticipated to dilute fixed costs. On the revenue side, users' willingness to spend on premium treatments, coupled with the 'blockbuster strategy' (top nine products contributed over 30% of Q3 revenue), and enhancing the lifetime value (LTV) of core members, are expected to drive profit margin improvements.

Jenny Xu from CICC inquired about potential bottlenecks in doctor recruitment during network expansion and the degree of reliance on individual center managers for operations.

Answer

Mona Qiao, Investor Relations, explained that there is a solid talent pipeline of doctors and that the company's focus on light medical aesthetics allows for rapid, standardized training. She emphasized that the business model reduces reliance on center managers by centralizing key functions like marketing, pricing, and recruitment, allowing managers to focus on on-site operational metrics monitored by headquarters via a digital dashboard.