Niu Technologies - Q1 2023

Transcript

Operator (participant)

Good day and thank you for standing by. Welcome to the Niu Technologies first quarter 2023 earnings release conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Wendy Zhao, IR Manager. Please go ahead.

Wendy Zhao (Senior Investor Relations Manager)

Thank you, operator. Hello, everyone. Welcome to today's conference call to discuss Niu Technologies results for the first quarter 2023. The earnings press release, corporate presentation and financial spreadsheets have been posted on our investor relations website. This call is being webcast from company's IR website as well. A replay of the call will be available soon. 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 different from those expressed today. Further information regarding the risk factors is included in company's public filings with the Securities and Exchange Commission. The company does not assume any obligation to update any forward-looking statement, 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. Let me turn the call over to Yan.

Yan Li (CEO)

Thank you, everyone, for joining us on the call today. In Q1 2023, our total sales volume was 94,407 units, representing a year-over-year decrease of 42%. Specifically, sales volume in the China market dropped by 45% year-over-year to 81,518 units, and the sales in the overseas market dropped by 12% to 12,889 units. Total revenue in Q1 was RMB 417 million, a decrease of 27.5% year-over-year. Now, the decrease in sales volume in the China market is primarily due to two factors. Firstly, the price increase caused by the rise in the lithium battery cost last year, and secondly, the expectation of new product launches in Q2.

In response to the lithium battery price hike in 2022, we increased the prices by average 7% across our product in the China market in Q2 2022 to maintain a healthy margin. This led to a decrease in sales. The impact of rising prices on the sales volume continued in Q1 2023 this year compared to the pre-price adjustment Q1 2022 on a year-over-year basis. For instance, our entry-level Goal Zero series, which targeted more price-conscious market, experienced the biggest year-over-year drop in sales of nearly 90%. The expectation of new product being launched in Q2 also contributed to the decrease in sales volume in Q1. Our distributors delay orders in anticipation of new product launch event that we host in Q2, where we release the mid and to premium products.

Despite the drop in sales volume, the retail sales number remain on par with Q1 2022 last year. Many of our retail partners choose to delay orders from traditional low Q1 to Q2 this year, given the on-time draw of our product in 2023. For the China market, we focus on the premium series and high-quality mid-end series as the premium high-end flagship products have enabled us to improve our margin and strengthen our brand positioning, where our mid-end product have allowed us to reach a mass market and achieve volume. With this focus in mind, we have developed products that combine design, aesthetics and technology-enabled functionalities to bring to the market. In the previous earnings call, I introduced the revolutionary high-end Stratolite electric bicycle, SQI, and the newest addition to the most popular U-series, the UQI+, which we launched in Q3 2022 last year.

Since their launch, both products have received recognitions from both the industry and our customers. The SQI won the Red Dot Design Awards Best of the Best 2023, which is the highest honor that the Red Dot Design Awards can bestow. The SQI have also won the iF Design Award 2023, making it potentially the third product to win all major awards after legendary U-one and M-one. The new UQI+ have also won the prestige Red Dot Design Awards and have been met with immense popularity in the market. Sales volume for the new UQI+ accounted for over 50% total sales of our premium product lines. Those awards and sales performance are testaments to our unwavering pursuit of creating a premium product that resonate with consumers.

We also rolled out a B2 product, which is the mid-end range form factor product, which has been very popular since its launch, accounting for nearly 30% of mid-end series sales in the first three quarters since its launch. In Q1 2023, we recently made an upgrade to the popular models, bringing a new look based on the original design and bring out the old-fashioned style from the minimalist appearance. Now building on the momentum generated by the product we launched last year, we released four new products in May during the annual distributor conference that will be launched into the market Q2 this year. The four product we recently launched are MQIL, the four G400 and G400T, and the RQI. I'll share some of the product highlights with you.

We introduced the MQIL, the new next level flagship product that inherits the design of our all-time classic M series, but it was significant upgrade in performance and smart functionalities. The M series is one of our two products that won all seven major international design awards in the mobility industry. The MQIL is the first major model we released, hoping to bring back the classic M series in the last few years. Retaining the classic style, the new MQIL features significant improvements in the light design range, charging features, new smart control, riding economics, and additional personalization features. The MQIL is equipped with new energy 9.0 battery, delivering an impressive 170 km max range, and it can charge to a 100 km drive range in just over two hours.

In addition, the new MQIL bike is equipped with the new Smart five point o with 20 smart features to make this scooter an industry-leading smart vehicle. Those include the new smart dashboard with navigation display, incoming call notice, the new smart lighting system with automatic turning lights, the OK Go control system that is fully integrated with the Apple ecosystem, allowing users to control the scooter with just your Apple Watch or Siri. Targeting the premium electric scooter users, the MQIL is priced from RMB 4,999-RMB 8,299. We have received more than 15,000 orders from our dealers within the first week of its launch. For the mid-end product lines, we announced the G400 and G400T. We took a innovative approach to use the same platform to build two vehicles.

The G400 is a light motorcycle, and G400T is electric bicycle. Both vehicles are built with the same modern design and chassis platform, combining design aesthetics and practical functionalities like large storage space. Both of them are equipped with a full set of new smart system features. The G400, G400T are set to launch in early June. We have also recently announced the market launch of our first quad electric motorcycle, RQI. The RQI has a top speed of 100 km per hour and drive range of 119 km. Equipped with 18 KW motor, the RQI can accelerate to 50 km per hour within just 2.9 seconds. The RQI also included many of smart features. The RQI is priced at RMB 32,980 and went online through a live streaming on May 20.

The product is perfectly suitable for motorcyclists who plan to switch from petrol to electric for the fast acceleration experience with the pursuit of environmental friendliness in mind. Now, we are confident that with this premium product we have introduced, the market will not only increase sales, but also enhance our brand image and strengthen our leadership in the high-end electric two-wheeler market in China. Our focus on developing premium products complementing with our effort to build a premium brand through user engaged activities and marketing campaigns. The Niu innovative ambassador program, where a selected core users and KOLs serving as a culture ambassador for Niu brand launch in 2022, has become a core part of a user-centered event planning strategy. Since its launch in Q3 last year, we have planned and hosted over 80 events in 30 cities in China.

Along with the product launch, we have organized a series of marketing branding campaigns through our online social media, KOL collaborations, offline product launch events, and PR. For online marketing, we invited over 150 KOLs and KOC content creators with large fan base to generate content showcasing our Niu product, and we expect those content to gain over 150 million views throughout the launch of event. For the offline event, we are planning to host four official events and utilize our innovative ambassador network to support another 15 events, bringing Niu scooters to the market. We believe that with those marketing content and offline event, we'll gain significant media exposure for the Niu products, further strengthening our brand image as an innovative leader in the urban mobility scenarios.

Turning into the overseas market, we have experienced a year-over-year decrease of 12% in sales in Q1, 2023. The electric moped category saw a significant 70% decrease, while the micromobility category enjoying a moderate 16% increase in sales. The price adjustment made in Q2, 2022, in response to the increase in the lithium battery price, continued to have an impact on the electric moped sales when compared year-over-year. The international distribution partner have also been waiting for a planned performance upgrade for our high-end performance 125cc bikes in Q2. For the European market, we're rolling out the improved 125cc products in Q2, 2023 to regain growth. In the Southeast Asian market, we are also developing a battery swapping enable solutions with electric moped swappable batteries and battery charging cabinets.

This solution will be suitable for battery swapping operators to sell the moped chassis, but also charging the batteries on a rental basis, lowering the upfront purchasing cost of electric moped in the region. We expect to roll out those solutions in second half of 2023. Together with those solutions, we are also actively expanding stores and developing partnerships with local operators and enhancing factory assembly capacity in Southeast Asia. Despite being in the low season, our micromobility category still experienced a moderate of 16% year-over-year growth in sales in Q1 2023. We have already established a solid foundation with our product portfolio, sales channel development, and the marketing and branding activities. With this foundation, we expect the micromobility category to continue to drive high quality growth in the coming quarters. In Q1 2023, we launched the KQi1 Pro as addition to our kick scooter product offerings.

The KQi1 Pro featured a patented folding mechanism added to the original KQi1 Sport kick scooter. With the newly added KQi1 Pro, we have completed the product offering that covers a wide range of product from high-end $900 price range to the entry level of $300 price range. The established kick scooter product mix has generated high volume growth since its launch. Beyond the growth in sales, our key kick scooters product has received a prestigious award, such the iF Design Awards and New York Product Design Awards. Our KQi2 and the KQiU Plus won the iF Design Awards 2023, the KQi3 Pro was selected as the gold winner of 2023 of New York Product Design Awards as the only product in the vehicle technology category.

Additionally, Niu was awarded the Rider's Choice Award 2023 as the best scooter company by the Micromobility World. With the market presence we have built throughout the micromobility products, one of our current focuses is on the sales channel expansion on the target market. As of May 2023, Niu products are available in approximately 500 retail stores in the U.S. and over 400 in Europe throughout retail partners such as Best Buy and MediaMarkt. This sales network has laid a solid foundation for ramping up our product sales in the upcoming quarters. In addition to the sales channel expansions, we continue to collaborate with influencers on product marketing campaigns to further establish our presence in the market. We have worked with over 300 influencers across various platforms to showcase our kick scooters and mopeds. Their content gathered more than 40 million views.

Owing to their broad reach and wide acceptance, our product have also been featured and placed in multiple TV shows like Move and Movies. We're pleasantly surprised to see our product appears in movies like Murder Mystery 2, and TV shows like The Drew Barrymore Show and The Price Is Right. In conclusion, regarding to the overseas market, we anticipate a sustainable growth drive driven by our strategy to diversify our product offering beyond the electric two-wheelers and expand it into geographic regions beyond our primary European market. Despite a temporary low quarters due to seasonality, we see growth potential stemming from our diversification strategy based on our product offerings and increasing brand recognition. Looking forward, we target to regain growth throughout 2023 in both China international market, gradually recovering from the negative impact of price increase and delayed product launch in 2022.

We have put a focused strategy in place for product development, brand marketing, and sales channel expansions. In the China market, our strategic product positioning have generated growth opportunity for us in 2023 by focusing on the premium and also the mass premium segment. By combining the high-end, high-quality product with user-centered activities and marketing campaigns, we aim to maintain our brand leadership in the premium urban mobility sector. With new product rollout and brand activities in place, we expect to see a strong rebound from last year starting in Q2 2023. For the overseas market, we'll anticipate returning to a fast growth path through a product and geographic expansions. In the electric two-wheeler sector, with the product ready for release in our respective markets, we believe we will see a sales ramp up in the near quarter.

As for the micromobility sector, with the comprehensive product offerings, extensive sales channel coverage, and the growing brand awareness, we expect this sector to experience a faster growth in the both sales volume and the margin performance. Now I'll turn the call to over our CFO, Fiona.

Fion Zhou (CFO)

Thank you, Yan, and hello, everyone. Please note that our press release contains all the figures and comparisons used, and we have also uploaded Excel format figures to our IR website for your easy reference. As I review our financial results, I'm referring to the first quarter figures unless I say otherwise, and all monetary figures are in RMB, if not previously stated. During the first quarter, our company achieved a total sales volume of 94,000 units. Of this figure, 81,000 units was sold in the Chinese market, while the remaining 13,000 units was sold overseas. The sales performance in China was mainly driven by the premium NIU series and mid-end Gova series, which accounted for a significant percentage of the sales volume.

Those two series represented 94% for the total sales volume for the quarter, which is a notable increase compared to the 70% shares in the same period of last year. In terms of the overseas sales, we continue to experience stable year-over-year growth in micromobility sales. Total revenue for the first quarter amounted to RMB 417 million, reflecting a 28% decrease compared to the same period of last year. Scooter sales contributed RMB 358 million to the total revenues. Analyzing the total revenue by region, we observed the revenue from the Chinese market amounted to RMB 305 million, representing a 33% decrease.

This decline was primarily driven by the decrease in sales volume of entry-level series, as discussed earlier. However, with the change in product mix, particularly with the introduction of the high ASP SQi model, our China scooter market had an increase in ASP from RMB 3,072-RMB 3,743, marking a 22% year-over-year growth and maintaining a stable level quarter-over-quarter. The overseas scooter revenue, including the motorcycles, the mopeds, kick scooters, and e-bikes, amounted to RMB 53 million, compared to RMB 66 million in the same period of last year. This decline was primarily due to the lower sales volume of the mopeds and the motorcycles. However, there was a significant growth in micro-mobility revenue, which witnessed a remarkable year-over-year increase of nearly 90%. In particular, kick scooter revenue surged by 62%.

It is worth noting that the kick scooter ASP also experienced a significant rise of 46%. Apart from the consistent increase in the sales volume, this impressed results were largely driven by the high-end KQi3 series, which accounted for 2/3 of the total kick scooter sales. Due to the higher proportion of kick scooters revenue, which has an ASP around 1/4 to 1/3 of the e-motorcycle and e-mopeds, the blended ASP for overseas scooter decreased by 8% to RMB Sorry, 4,138. The revenue from accessories, spare parts, and services amounted to RMB 59 million, marking a 13% increase compared to the fourth quarter of last year. This growth can be primarily attributed to the expanding popularity of our NIU application service subscription.

The fourth quarter gross margin increased by 2.6 PPT year-over-year, reaching a 21.7%. This improvement was driven by various factors, including 0.9 PPT increase in kick scooter gross margin, 0.8 PPT improvement in product mix, and price increase in domestic markets, and 0.9 PPT boost from the non-scooter sales with a higher gross margin. Our fourth quarter OpEx amounted to RMB 57 million, representing a 10.3% increase compared to the same period of last year. Among the total expenses, selling and marketing expenses reached RMB 72 million, slightly rising by RMB 2 million year-over-year, primarily due to the increase in depreciation and amortization expenses. Research and development expenses amounted to RMB 35 million, reflecting a reduction of RMB 7 million, as we have successfully lowered the cost and improved efficiency in this area.

G&A expenses were RMB 50 million, RMB 19 million higher. We have made a provision for credit loss for RMB 21 million. However, if we exclude this provision, G&A expenses decreased by 6% compared to the previous year. With the expansion of our overseas business, the scale of account receivables, which served as the basis for calculating the bad debt provision, had also grown accordingly. We have observed the European consumer sentiment remains cautious, leading our distributors to request extended payment terms due to the weak retail sales. Despite increasing credit loss provisions for overdue payments in a prudent manner, we maintain an optimistic outlook on receivable collections in the future, as our partners are in sound financial condition and have continued making payments during this period. The OpEx as % of revenue increased primarily due to the lower revenue base.

In the first quarter, our net loss was RMB 60 million, with a net margin of -14.5% under the GAAP measurement, compared to the net loss of RMB 29 million with a net margin of -5.1% at the same period of last year. Turning to our balance sheet and cash flow, we ended the quarter with RMB 860 million in cash, restricted cash, term deposits, and short-term investments. Our operating cash flow amounted to RMB 66 million, primarily driven by a seasonal settlement of RMB 95 million in payment to the upstream suppliers. However, we successfully decreased our operating cash outflow by RMB 101 million compared to the first quarter of the previous year, thanks to the negotiated improvements in credit terms with our suppliers.

Our CapEx for the first quarter amounted to RMB 16 million, reflecting a decrease of RMB 44 million compared to the same period of last year. This reduction can be attributed primarily to the decrease in the opening of new stores in China. Since the second half of last year, our channel strategy in the Chinese market has shifted from the rapid store expansion to same-store sales performance improvement. Now, let's turn to the guidance. As we enter the peak season and launch our new products, we are aiming to get back to the growth track and expecting the second quarter revenue to be in the range of RMB 828 million-RMB 952 million, representing a year-over-year flat to 15% increase.

Please be aware that this outlook is based on the information available for the date and reflects the company's current and preliminary expectations, which were subject to change due to the uncertainties relating to various factors. With that, let's now open the call for any questions that you may have for us. Operator, please go ahead.

Operator (participant)

Thank you. As a reminder, to ask a question, you will need to press star one and one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. Please stand by while we compile the Q&A queue. We'll now go ahead with our first question. Our first question comes from the line of Yating Chen from CICC. Please go ahead. Your line is open.

Yating Chen (Analyst)

Hello. My first question is the number of our channels has decreased in quarter one. How should we understand this trend, and how should we look forward in the whole year about the number of our channels?

Yan Li (CEO)

Yes. Let me address this question. I think basically you look at the channel has decreased by about, I think roughly about 150 or 160 stores in Q1. I think this is actually reflected to the status in 2022, because towards the end of 2021, you look at we actually add about 1,600 stores in 2021, and many of the stores are actually targeted to lower tier cities where the entry level priced product are being sold. In reality, I think in 2022, with the lithium battery price went up significantly, you can see our entry level product percentage actually dropped significantly, from, you know, representing used to be 38% of the sales volume dropped to almost a single-digit % volume. That's where, you know, in some of the cities or some of the places where, those stores have become unsustainable.

We actually took active approach and then, you know, sort of optimize the stores. I think that's what happened. Now, going forward, I think typically in Q2 and Q3 is the peak seasons. We don't expect, we will actually increase the number of stores. I think, you know, looking at this year, I think we'll go back to on sort of a sales store expansions, trend, probably Q4 this year when it's actually coming to a low season sales.

Yating Chen (Analyst)

Okay. Thank you very much. My second question is about, as we all know, maybe the two-wheeler industry is witnessing the price war. How do you view the price war and will us join the price war?

Yan Li (CEO)

Yes. I think, you know, this year we do observe there's a price war with the, you know, big players competing and basically competing in the low end, basically in the low end market, basically that's below the, in reality, basically below the RMB 3,000, below the RMB 2,500 sectors. I think the reality is we don't have, you know, we don't actually have the product in that range, in that price range. I think we were less affected by the price war. You know, as of... I think, you know, our focus is still sort of at a, at the what I call the mid-end market and the premium market. Mid-end market basically, product price above RMB 3,500-RMB 5,000 and the premium market are the product price above RMB 5,000. I think in those price ranges, I think there in reality there are less price war involved.

Yating Chen (Analyst)

Okay. Okay. Thank you very much.

Operator (participant)

Thank you. We'll now move on to our next question. Our next question comes from the line of Jiong Chang from CICC. Please go ahead. Your line is open.

Jiong Chang (Research Analyst)

Hey. [Foreign language] This is my first question. Seeing that our income guidance or revenue guidance in the second quarter was very positive, we achieved a year-on-year positive growth. At the same time in May, we also released several new products. What is the feedback from our dealers and the market after the product listing, and how do we expect the domestic sales volume recovery in the second quarter and third quarter? In addition, will other new products to be launched in the second half of this year, and what are their main market segment target?

Yan Li (CEO)

Yeah. June, I guess it's okay, I'll respond in English as for the general audiences. I think one, with the four new product, I think the ML is already out. The G400, G400T, we, you know, haven't really announced the price or accepted, you know, taking orders yet. With our first product, the MQIL, we actually got a huge response from the dealers, from the consumers, and from the market, and even from the social media. I think that's a, you know. Even the first week, within the first week or so, I think from the sort of dealers are committing almost like more than 15,000 units.

I think the issue, looking at it in a month basis, is probably somewhere around, you know, 30,000, 40,000 units ordered. We're actually, you know, the issue we have is right now is actually need to ramp up the production. It's a good response from market. The reason it has a good response with the market because, you know, it's come from a legendary product. It's a M series. Our original M series announced in 2016, basically was the all-time awards winner product.

You know, we actually have people, you know, sort of yelling out, saying they want to have something product that look like M, upgrade M, but actually adapt, and also compatible with the new China new standard. I think that's what that is. Now, with going forward to Q2 and Q3, I think, you know, we have, I think one, two... We have like two or three products in the pipeline. Basically we're looking at this year we'll probably have products coming out in May, June, July, and August, and potentially September. I think that's the layout of the... We have quite a few products, new products. Most of those products are going to focus on, one, the premium end, and the second, the mid end.

With model two with potentially one sort of the entry-level, you know, entry-level upgrades. I think that's. We actually, I think we're very optimistic. We're very confident with the new product offerings. I think this actually reflect how, you know, how of what we forecast our Q2 earnings. Having said that, I think it's the With the response market itself, we do take a more cautious view. One is, we're, I think in term our market sizing, we take a cautious view, in term of the market does, it is, you know, observe some sort of. At least in some of the provinces, we observe like a market slowdown because the product replacement happened last year.

The second, I think some of the previous question mentioned with the price war, we do see it's happened at low end, but we don't know whether actually will extend to the mid-end prices. This is something we take cautious view. On the positive note is, there is a trend where we do see the lithium carbonate pricing came down quite a bit from the peak of last year. Which means there will be a downward pressure on the lithium battery prices, which means that with the lithium battery prices coming down, the percentage of lithium scooters as the overall percentage of the electric scooters sold in China, that percentage will start to come back up. That's where, you know, our targeted market mainly. I think that will actually help us a little bit, basically on the Q2 and Q3, especially Q3.

Jiong Chang (Research Analyst)

Thank you. Thank you, Mr. Yan.

Yan Li (CEO)

I think one, with the kick scooters as, you know, as May, today, we're being to 400 plus offline channels in United States. I think those are mainly the Best Buy, Best Buy mainly, and also Walmart. We are also in about 400 plus channels in the, I think in the, in, in the Europe, which is a typical sort of the MediaMarkt ECI, those ones. I think the so in term of offline channel expansion, I think that's completed. The now with the Q1 this year, I think the issue with the Q1 has also been a traditionally has been a low quarter in term of kick scooter sales. I think that's why you do see the Q1 year-on-year increase significantly.

Second, it's also because I think what happened is, I think one minor detail I didn't mention on the call is, with the typically with our, you know, with the moped, I think what happens when the moped distributor order, they take a month, a month and half to ship the moped to the, you know, to Europe. That's where, you know, you ship in Q1, you start to see the sales in Q2. With the kick scooters, a lot of, you know, a lot of actually our current business model is actually we have kick scooter inventories in Europe. So there is, you know, low season is actually low season. It doesn't. You don't see this sort of like a three-month lag.

I think that's what happened where, you know, Q1 is low season, they decide not to order too much. They just match whatever sales out. I think we expect the Q2 and Q3 really start to pick up. I think throughout the whole year, we expect this business grow about 2-3x. Whether we land at 3x or whether it land at 2x, I think it really depends on how we perform in Q2 and Q3. Also depends on how I think the overall market responded. I think in historically in the past, the overall market has been saying the market has been growing, you know, at a double digit.

But this year, I think we'll also, you know, take a cautious view. Regardless, I think from our point of view, even we do about 3x, that's only a 300,000 unit sales compared to overall market is about 4 million units. We're still a very small, you know, small player within. Even we do about 300,000 sales out of that 4 million units, you're talking about what? It really gives a 7% of market share. Still a very small market, you know, player there. Which means actually, which, you know, we do have a tremendous growth potential.

Jiong Chang (Research Analyst)

Okay. Thank you. Thank you very much for your detailed answers. This is all my question. Thank you.

Yan Li (CEO)

All right. Thank you.

Operator (participant)

Thank you. We'll now move on to our next question. Our next question comes from the line of Scarlett Ge from Credit Suisse. Please go ahead. Your line is open.

Scarlett Ge (VP)

Hi. Thank you, management, for the introduction. Congrats on winning great orders for the new launched products. I have two questions. The first question is, could you share the order flow of other product models? My other question is, would you keep your full year 2023 target in both the sales volume and the sales revenue? 'Cause if I add up the first quarter revenue and the guided second quarter revenue, it totally accounted for around 30% of the whole year revenue target. Any actions you would like to take to realize the targets? Or would you like to change? Thank you.

Yan Li (CEO)

I think just first respond to the quick address on the revenue percentage question. I think this year we're looking at, it's actually you look at this year sort of a rebounding case where, the, you know, the Q1 this year compared with last year Q1 was a drop because, you know, it was the last year Q1 was a pre-price increase. That was a, you know, unfair comparison. Where, you know, we expect to, you know, really have Q2 start to get back to the growth momentum and with, you know, Q3 and Q4 looking for a quite significant growth over the last year. Issue being that also I think this is also related to how our new product rolling out.

You know, with the first new product rolling out in May, which means, or in mid-May, which means that actually only able to impact about half of the Q2. Q3 and Q4, you're gonna see sort of a full impact of the new product coming out. I think that's on the China side. A similar thing in the sort of in the international side as well, where I think really the, you know, as I mentioned earlier, the Q1 with the kick scooter is a low season, so it's unfair. It's, you know, the year-over-year growth is only like what? 16% less.

Where really, you know, the whole year you're looking at a 2x or 3x growth, which means that the growth in Q2 and Q3, Q4 will be more significantly than the first quarter. I think that's where you start, you will see a, this is a typical range. I think it's a combination of rebounding from a, you know, a downward momentum last year and also a product roll out schedule. That's where you know, we expect to see a faster growth in the second half this year versus the first half.

Scarlett Ge (VP)

Okay. Thank you very much. My other question is that, can you share the order flows in hand for the other product models? For the new product, new launched products, when will you start to deliver?

Yan Li (CEO)

Right. I think, you know, currently, I think what we see is actually about, roughly about 50% orders from actually the newly launched models and, you know, 50% from the existing models. I think that's what we see in May. We don't have a forward looking in June because there are two new product coming out, the G400, G400T coming out in early June, and how that reflected the orders.

Scarlett Ge (VP)

Okay. Got you. Thank you very much.

Operator (participant)

Thank you. Once again, as a reminder to ask a question, you will need to press star one and one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. There are no further questions at this time. I'll hand the call back to CEO, Dr. Yan Li, for closing remarks.

Yan Li (CEO)

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 reporting to you again next quarter on our progress. Thank you.

Operator (participant)

This concludes today's conference call. Thank you for participating. You may now disconnect.