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Summary of TuanChe Limited Q3 2021 Earnings Call

1. Key Financial Results and Metrics

• Net Revenues: RMB 61.1 million, a decrease of 38.9% year-over-year (YoY) from RMB 100 million.
• Net Loss: RMB 36.8 million, narrowed from RMB 41.2 million YoY.
• Gross Profit: RMB 46.8 million, down 35.1% YoY; gross margin improved to 76.6% from 72.1% YoY.
• Expenses:
  • Selling and marketing expenses decreased by 34.6% to RMB 59.9 million.
  • General and administrative expenses increased to RMB 17 million from RMB 15.9 million YoY.
  • R&D expenses rose to RMB 9.2 million from RMB 7.1 million YoY.
• Adjusted Net Loss: RMB 34.4 million, compared to RMB 38.3 million YoY.
• Cash Position: RMB 134.3 million in cash and cash equivalents at the end of September 2021.

2. Strategic Updates and Business Highlights

• EV Manufacturing Initiative: TuanChe is expanding into electric vehicle (EV) manufacturing, leveraging its existing platform and customer base. The company aims to establish a design R&D and manufacturing team while seeking strategic partners.
• Offline Marketing Services: The number of auto shows organized decreased significantly due to COVID-19 and supply chain issues, resulting in a 59.9% YoY revenue drop in this segment.
• Online Services Growth: Revenues from virtual dealership and online marketing services increased by 72.6% YoY to RMB 26.6 million, driven by enhanced collaboration with partners.

3. Forward Guidance and Outlook

• Q4 2021 Revenue Forecast: Expected between RMB 70 million and RMB 80 million, representing a year-over-year decline of approximately 51.7% to 57.8%, primarily due to reduced offline events and ongoing supply chain challenges.

4. Bad News, Challenges, or Points of Concern

• Revenue Decline: Significant contraction in overall revenues, particularly in offline marketing services, due to pandemic-related cancellations and chip shortages affecting auto production.
• Market Conditions: The company faces a challenging macro environment with ongoing COVID-19 impacts and global supply chain disruptions, which are expected to continue influencing performance.
• Increased Costs: Rising R&D expenses indicate a commitment to innovation but may pressure margins in the short term.

5. Notable Q&A Insights

• The management emphasized the importance of adapting to changing market conditions and the strategic pivot towards EV manufacturing as a long-term growth opportunity.
• There were discussions on the competitive landscape in the EV market, highlighting the need for TuanChe to leverage its existing customer insights and sales network effectively.
• Management acknowledged the uncertainty surrounding future revenues due to external factors, including the pandemic and supply chain issues, signaling a cautious approach moving forward.

This summary encapsulates TuanChe's current financial standing, strategic direction, and the challenges it faces as it navigates a complex market environment.