SY — So-Young International Inc.

Summary of So-Young's Q4 2025 Earnings Call

1. Key Financial Results and Metrics

• Total Revenue: RMB 451 million, up 25% year-over-year, marking a record quarterly revenue.
• Aesthetic Center Revenue: RMB 248 million, a significant increase of 205% year-over-year, contributing over 50% of total revenue for the first time.
• Net Loss: RMB 108.8 million, an improvement from RMB 607.6 million in Q4 2024. Non-GAAP net loss was RMB 93.4 million.
• Cash Position: RMB 936.4 million, down from RMB 1,253.2 million year-over-year due to accelerated investments in expansion.
• Profitability: 25 centers achieved profitability in Q4, with 39 generating positive operating cash flow.

2. Strategic Updates and Business Highlights

• Expansion: Opened 49 medical aesthetic centers, becoming the largest chain in China by center count. Plans to open at least 35 new centers in 2026, focusing on core cities and second-tier markets.
• Operational Efficiency: Enhanced operational performance with 25 centers achieving profitability. Average revenue per center increased significantly as centers matured.
• Service Delivery Improvements: Expanded physician team to 211, with a focus on quality and compliance. Implemented a six-pillar compliance framework and achieved TIA certification for data security.
• Product Strategy: Launched new products and marketing campaigns, with blockbuster products contributing over 37% of revenue.

3. Forward Guidance and Outlook

• 2026 Revenue Guidance: Expected aesthetic treatment services revenue between RMB 258 million and RMB 278 million, indicating year-over-year growth of 171% to 181%.
• Focus Shift: Transitioning from rapid expansion to balancing growth with profitability, leveraging scale for improved gross margins.

4. Bad News, Challenges, or Points of Concern

• Decline in Other Revenue Segments: Information and reservation services revenue decreased by 26.8%, and sales of medical products dropped by 19.9% year-over-year.
• Cost Increases: Cost of revenues rose significantly, particularly in aesthetic treatment services, which may pressure margins in the short term.
• Goodwill Impairment: Recorded a goodwill impairment charge of RMB 19.7 million, indicating potential concerns regarding asset valuations.

5. Notable Q&A Insights

• Gross Margin Prospects: Management highlighted three factors influencing margins: pace of center openings, consumable costs, and seasonal promotions. They aim to optimize these to enhance margins.
• Second-Tier City Performance: Centers in second-tier cities are performing well, with revenue growth comparable to first-tier cities, and are expected to maintain higher margins due to lower operational costs.
• Customer Acquisition Costs: The company has maintained a competitive edge in customer acquisition costs, leveraging a referral model and co-branding initiatives to enhance brand equity and reduce costs.
• Core Member Growth: Continued focus on improving lifetime value (LTV) for core members through expanded product offerings and optimized membership benefits.

This summary encapsulates the key financial metrics, strategic initiatives, future outlook, and challenges faced by So-Young as discussed in their Q4 2025 earnings call.