Thank you, operator, and hello, everyone. We appreciate you joining us today for Pony AI's fourth quarter and full year 2025 earnings call.

Earlier today, we issued a press release with our financial and operating results, which is available on our Investor Relations website. An earnings presentation, which we will refer to during the conference call, can also be accessed and downloaded on our IR website.

Joining me today on the call are Dr. James Peng, Chairman of the Board and CEO; Dr.

Tiancheng Lou, CTO; and Dr. Leo Wang, CFO of the company.

They will provide a prepared remark, followed by the Q&A session. Before we begin, please refer to the safe harbor statement in our earnings release, which applies to this call as we will be making forward-looking statements.

Please also note that we will discuss non-GAAP measures today, which are more thoroughly explained and reconciled to the most comparable measures reported under the GAAP in our earnings release, available on our Investor Relations website and filings with the SEC and Hong Kong Stock Exchange. I will now hand over to our Chairman and CEO, Dr.

James Peng. Please go ahead.

Thank you, George. Hello, everyone.

Thank you for joining our earnings call. 2025 is an amazing year for us.

This was actually defined by multiple remarkable milestones. First, our top-line growth significantly accelerated.

Looking at Q4 last year, our robotaxi revenues surged by 160% year-over-year, and fare-charging revenues skyrocketed by over 500%. Second, since our Gen 7 robotaxis debut last April, we've moved straight into mass production and commercial deployment.

Our fleet has now surpassed 1,400 units. Third, we are expanding our footprint, launching services in new cities in both China and globally.

This has massively broadened our reach. In fact, we're now crossed the 1 million user mark in China alone.

Fourth, we've proven our business model actually works. We achieved UE break-even in both Guangzhou and Shenzhen, and we will replicate this success into more markets.

Looking ahead at 2026, it will definitely be a year of hyper-growth for Pony. We're riding a perfect wave of industry momentum, built on five pillars: fully driverless technology, policy support, mass production, large-scale operation, and ecosystem maturity.

Last year, we used China's Tier 1 cities as a strategic blueprint to deploy Gen 7 robotaxis. From official debut to mass production, regulatory validation, and rigorous testing, we achieved commercially fully driverless operations within just 6 months.

Last quarter, we set our robotaxi fleet target to over 3,000 units for this year, boosted by the financial firepower from our successful Hong Kong IPO, and also with the Toyota bZ4X Gen 7 model already in SOP. We now have greater visibility and are confident in actually even exceeding this target.

Our excellent virtual driver is the key to support this confidence. Proven mastery of highly complex urban scenarios and a superior safety record have earned deep trust from the policy makers and the partners, driving rapid user adoption.

This directly translates into positive UE. Since we hit the UE break-even in Shenzhen last month, growth momentum continues with this March, we are seeing peak daily revenues of 394 RMB per vehicle and daily orders at 25 per vehicle.

We will certainly replicate this success globally. By year end, we plan to deploy robotaxis in over 20 global cities.

As the go-to partner, we have forged strategic alliance with industry leaders like Tencent and Uber. Together, we will propel global expansion, powering accelerated top-line growth, and more than tripling our robotaxi revenues for 2026.

Let me elaborate how we will drive this hyper-growth. We are executing dual-engine strategy.

That means we are all in on both China and global markets. Our proven business model in China gives us a solid foundation to replicate the success internationally.

We are already seeing great results that positions us for our next growth phase. In China, we have earned a clear leadership across Tier 1 cities, scaling further and pushing deeper into busy downtown areas.

Take Shenzhen, for example. Our robotaxis satisfy surging demand in traffic hubs, such as Nanshan and Bao'an during Chinese New Year.

The paid orders in the first 2 months this year alone have already surpassed that of the whole year 2025 in Shenzhen. We also entered University Town in Guangzhou, the busiest campus zone in Southern China.

This sets the stage for more launches in multiple cities across the Greater Bay Area. In March, we also entered Hangzhou and Changsha, two thriving top Tier 2 cities.

This is just the start, and we will have more cities to follow soon. Now turn to overseas markets.

Our presence in Europe, the Middle East, East Asia, and Southeast Asia now covers a population of 100 million. We're aiming for nearly half of our 20-city target to come from overseas by the end of this year.

Recently, we teamed up with Uber and Verne, which is a Rimac Group company, to enter Croatia, working together to launch Europe's first commercial fare-charging robotaxi service. In the Middle East, we rolled out our first fare-charging service with Mowasalat (Karwa) in Doha, and we are gearing up for fully driverless operations after the approval later this month in Dubai, UAE.

In Singapore, we have launched public debut of autonomous driving services with ComfortDelGro. We're confident overseas revenues will grow rapidly in 2026.

Ecosystem maturity is a critical pillar in executing our dual-engine strategy. Our successful business model makes us a go-to partner.

Partners are now actually lining up to join our joint deployment model. Essentially, it's a model that they will fund the vehicles, and we can share success together.

This will empower us to achieve fleet acceleration, reduce cost, and capital efficiency. We have got a robust pipeline of new partners ready to jump on board.

Toyota is the first to adopt our joint deployment model. Their bZ4X Gen 7 robotaxis will account for a significant portion of our 3,000-vehicle target in 2026, and we have already secured 1,000 units.

As a long-standing strategic partner, our collaboration with Toyota extends far beyond just manufacturing. Together, we will commercially deploy robotaxi to drive market penetration.

By leveraging our OEM partner's mature supply chain and extensive after-sales service networks, our enhanced partnership with both BAIC and GAC further reduce our vehicle cost. In addition, we will jointly deploy robotaxi vehicles into more overseas markets.

To reach a broader user base, we also partnered with Tencent by integrating with WeChat Mobility, unlocking access to hundreds of millions of users to call our robotaxi services. We are also deepening strategic partnerships with Ontime Mobility in Guangzhou and ATBB in Beijing to accelerate adoption of our joint deployment model.

Overseas, our global partnership with Uber enables us to access users across multiple continents, starting from Europe. Our regional alliance strengthen our market penetration, with partnerships established with ride-hailing platform Bolt and also auto manufacturers Stellantis.

Now, let me turn to robotruck. Over the past few years, we've made huge technological leaps by using our proven L4 tech stack.

It has been translating into commercial breakthroughs. We are now covering major logistics routes connecting industrial hubs, ports, and consumption centers across China.

To seize the opportunity, we introduced our Gen 4 robotruck in 2025, reducing the ADK BOM cost by 70%. We target mass production of Gen 4 robotrucks and deploy them this year.

In 2025, we have deployed fully driverless robotrucks at Jiangmen Port in Guangdong Province and tested the 1+N driverless platooning in extreme weather conditions in Northwest China. With this proven pack, we will deploy robotrucks in more ports and mine haulage scenarios.

Lastly, our licensing and applications business delivered a robust growth. Last year, autonomous domain controllers, the ADC, sales actually reached six-fold to the level of 2024.

We have also expanded our application scenarios to low-speed deliveries, robosweepers, logistics, and humanoid robotics. Strong customer demand and growing market recognition of our technology will continue to drive growth.

In summary, we have hit a major inflection point as we're validated business model through 2025 achievements, such as fleet expansion, new city launches, and UE break-even. 2026 is poised as a year of hyper-growth.

We are super confident to triple our robotaxi revenues, grow fleet to over 3,000 vehicles, and deploy robotaxis in more than 20 global cities. Powered by our dual-engine strategy, we are speeding towards autonomous mobility everywhere.

I firmly believe, every effort we make today, we're not only reshape the future of human mobility, but also drive a revolution in transportation. This will be a revolution where safety, efficiency, and accessibility redefine how the world connects, commutes, and thrives.

With that, I'll hand it over to our CTO, Dr. Tiancheng Lou, who will go over our technology strategies.

Tiancheng, please go ahead.

Thank you, James. Hello, everyone.

This is Tiancheng. Looking back at our journey in 2025, it was a landmark year.

We proved the commercial viability of autonomous mobility, achieving positive unit economics in Guangzhou and Shenzhen. Today, our fleet size has surpassed 1,400, a large growth throughout the year.

Robotaxi is the first true commercial application of physical AI, validated by real-world operations and user adoption. Our L4-native tech architecture, built on years of R&D, has earned the trust of policy makers and established first-mover advantage to capture multi-year growth.

As highlighted in the previous quarter, world models are now the widely recognized tech path, a domain where we hold a firm leading position with Pony World Model. Technology is only the foundation.

The key to success is who can deliver reliable driverless robotaxi service at scale. I will walk you through how our technology drove commercial results in 2025 across three dimensions: scale, efficiency, and user experience.

First, scale. Through strong execution on mass production, we surpassed our 2025 fleet target, and this momentum positions us to reach over 3,000 units by the end of 2026.

Since middle 2025, we began mass production of two Gen 7 models with GAC and BAIC, both now ramping up to full capacity. In February this year, the bZ4X Gen 7 robotaxi, co-developed with Toyota, rolled off the production line.

The strong generalization of our autonomous driving stack enables us to efficiently adapt across different vehicle platforms. This multi-OEM network enables rapid scaling while strengthening local partnership and broadening our robotaxi vehicle offerings.

This scale is backed by a comprehensive ODD that validates our technology's ability to generalize across diverse urban environments. Today, our fully driverless fleet operate 24/7 in many cities across the globe, serving the public during peak rush hours and severe weather conditions.

Achieving this requires rigorous engineering validation, and the breadth of our fleet deployment and ODD reflects the maturity and robustness of our autonomous driving stack. Our overseas expansion further validates this generalization capability.

In Croatia, we're operating across a large area in the center of Zagreb, the capital's urban core, handling complex urban traffic rather than limited low-complexity routes. Such ability to deploy in demanding environments from day one demonstrates both the robustness of our technology and the commercial potential of our global expansion.

This gives us strong confidence in reaching our target of more than 20 cities worldwide. Second, efficiency.

We've established a clear cost advantage, driving a two-fold improvement. On hardware, we optimize the design in Gen 7 robotaxis, effectively lower BOM cost through adopting more cost-effective components.

On operation, our safety record creates significant leverage, dramatically reducing insurance fees and improving remote assistance efficiency. All of this enables us to scale with positive unit economics.

Beyond that, our tech is building a powerful operational moat. We have developed a highly generalized AI driving capability to build comprehensive and scalable operational workflows.

This deep know-how makes us to the go-to partners across the mobility ecosystem. It perfectly positions us to execute our joint deployment model, allowing us to scale fleet much faster with better capital efficiency.

Third, user experience. Technology enables robotaxi to serve consistently in high-value, high-difficulty scenarios.

I will continue with the third factor, user experience. Our technology enables robotaxi to serve consistently in high-value, high-difficulty scenarios, exactly in high-frequency ride-sharing hotspots where demand peaks and users are willing to pay a premium.

This differentiates our service, supports our pricing strategy, and directly drives UE improvement. For example, in Shenzhen, our 24/7 driverless robotaxi covers high-traffic urban zones, such as Nanshan High-Tech Area, to fulfill daily commuting needs.

During rush hours, our AI virtual driver navigates not only major main roads, but also narrow streets where commuters actually need to pick up and drop off, providing convenient point-to-point coverage that truly address real-world commuting needs. In Beijing, during a heavy snowstorm in the early March, getting a ride become a major pain point for users, such as long waiting time and limited availability.

Despite the extreme conditions, snow-covered sensors, reduced visibility, and unpredictable road conditions, all demanding significantly high driving capabilities, our robotaxi fleet continued operations throughout the snowstorm, capturing substantial order volume growth during that period. Beyond handling extreme conditions, we have significantly improved ride comfort.

Our Gen 7 robotaxi delivers smoother acceleration, braking, and cornering, significantly reducing motion sickness, a pain point that users care about most. This underscores a fundamental point.

Technology leadership is not just an engineering milestone. It is the core engine of our commercial success.

Outstanding user experience earns user preference and repeats usage organically without rely on discounts. Beyond our robotaxi business, our proven L4 technology enables us to capture commercial opportunities across a broader autonomous driving industry.

Our platform's generalization enables 80% of the tech stack shared between robotruck and robotaxi. We have achieved true, full-scenario, all-weather, 24/7 operational capability.

Our operations now span from complex highway segments to unique scenarios like port logistics, with our cumulative mileage exceeding 60 million kilometers. We also unlock synergy for the licensed application segment.

Through leveraging our advanced autonomous driving domain controller design, capitalizing on the rapid growth trend in low-speed delivery, robosweepers, logistics, and robotics, we effectively fulfills our customer demand on robustness. Looking ahead to 2026, we will increase our investment in R&D and AI talent to accelerate our competitive position.

Specifically, we are focused on advancing our Pony World Model to further strengthen our autonomous driving capabilities, reducing BOM cost through continuous hardware-software optimization, and improving operational efficiency to lower per-vehicle operating cost. This improvement are designed to fuel faster commercialization, expanding our robotaxi operation to more than 20 cities globally by year end and delivering faster revenue growth.

We will over-triple robotaxi revenues than 2025. As we demonstrated already, technology leadership directly drives commercial performance, and this investment will further widen our advantage.

This concludes my prepared remarks. I will now pass the call over to our CFO, Dr.

Leo Wang, for a closer look at our financial results. Leo, please go ahead.

Thank you, Tiancheng, and hello, everyone. This is Leo.

I will focus on year-over-year comparison for the fourth quarter unless otherwise noted. For full year 2025 and fourth quarter detailed financials, please refer to our earnings release.

2025 marked an inaugural year of large-scale commercialization for our robotaxi operations. Robotaxi segment continues to act as core growth engine for the group, delivering exceptional top-line growth.

In the fourth quarter, robotaxi revenues surged 160% to $6.7 million. For full year 2025, robotaxi revenues reached $16.6 million, growing more than doubled at 129%.

This remarkable acceleration was primary driven by our fare-charging service, which we saw Q4 fare-charging revenues skyrocketed by 501%, with a full-year growth rate of nearly 400%. More importantly, within just 4 months of Gen 7 robotaxi launch, we are thrilled to see consecutive UE turned positive in both Guangzhou and Shenzhen, two of the most valuable cities in China.

This milestone was built on two unique pillars that are exceptionally difficult to replicate from others. First, our clear cost advantages in both vehicle and robotaxi operations.

Second, our exceptional AI driving capabilities. Being capable of navigating highly complex urban environments 24/7, we deliver a consistent, reliable, and high-quality service, which helped us to capture the robust user demand.

With the foundation of positive UE and as vehicle density improves, we are seeing a clear network effect. Improving fleet density shortens wait time, boosts utilization rates, and drives the number of orders per vehicle.

This in turn enhances overall passenger experience and further stimulates ride-hailing demand. Specifically, year-to-date of 2026, our users have nearly tripled year-over-year and reached 1 million.

In February, we successfully delivered unit economic positive in Shenzhen, with an impressive average daily orders of 23 and 338 RMB average daily net revenue on a per-vehicle basis. As a matter of fact, this strong upward trend is continuing right now.

In March, we hit a new daily peak of 394 RMB net revenue and 25 orders per vehicle. More excitingly, our paid orders in the first 2 months of 2026 in Shenzhen have already surpassed the entire order volume for the full year of 2025.

Looking ahead, we remain highly confident in the growth trajectory of our robotaxi business. As James mentioned, our dual-engine strategy will drive rapid expansion into more than 20 cities in China and overseas.

We are confident that our robotaxi revenues will at least triple this year. Simultaneously, we are enhancing our revenue quality by adding high-margin recurring revenue streams through robotaxi joint deployment with our partners, such as Ontime Mobility.

This model will lower the CapEx requirement on initial fleet deployment from our end, and can also give us leverage to expand faster and more efficiently into new regions. From a technology perspective, as Tiancheng mentioned, our advanced AI driver capability directly empower a premium user experience, providing safe, reliable, smooth, and efficient rides for passengers.

This superior experience strengthen our pricing power and deepens user mindshare, which can further boost top-line growth. On the cost side, we have proactively secured procurements for critical vehicle components and hardware, including high-demand memory modules.

Therefore, we expect minimal impact from supply chain pricing fluctuation. Meanwhile, with greater fleet scale, continuous tech re-iteration, and the deepening OEMs collaboration, we have high confidence in continuously reducing our vehicle BOM cost and further improving operation efficiency.

Together, the high gross margin profile of the robotaxi segment is fundamentally elevating our revenue quality and actively contributing to the group's future profitability. Now let's move on to robotruck.

By leveraging our proven robotaxi stack, our next-gen robotruck achieves a 70% cost reduction. Furthermore, our transition to EV trucks also will continue to drive down per-kilometer operating cost.

Looking ahead to 2026, our shared expertise in robotaxi will accelerate our robotruck mass production, enabling us to begin deployment within 2026. As we aggressively deepen our route coverage across major logistics corridors and expanding into more scenarios, such as dedicated lines and port operation, we expect to see accelerated growth in revenues beginning in the second half of this year.

With lower structural costs, continuous tech breakthroughs towards driverless operation, we are perfectly positioned to capture the freight market's immense value. Thirdly, our licensing and application also delivered impressive growth in 2025.

We are seeing strong clients demand from our autonomous domain controller, ADC product, with the ADC volume grew to six time of the level of 2024. Looking ahead, we are seeing a solid order pipeline from existing customer and are actively expanding into new use cases.

On the overall profitability front, we achieved a historical financial milestone in the fourth quarter by achieving a first-ever quarterly GAAP-level net profit. This historical pivot to profitability was primarily driven by the gains from our strategic equity investments, which strengthen our broader ecosystem positioning and unlock business synergies.

In 2025, our expense were slightly widened. This was a deliberate front-loaded investment to accelerate Gen 7 mass production, expanding into new cities, and strengthening our tech stack.

Such investments are already starting to drive strong top-line growth. In the era of AI, we anticipate continuous investments into AI technology and talents to help us secure a long-term competitive edge.

Beyond technology benefits, our joint deployment model will also be a powerful lever for CapEx efficiency. By collaborating with partner to share the initial investment, we are able to scale our fleet rapidly while maintain a lean balance sheet.

Looking ahead, we expect the revenue growth to outpace the growth of operating expenses, as we capitalize our fleet scale and capture the virtuous cycle of positive UE. Finally, we close the year with a highly robust balance sheet, with substantial cash reserve of over $1.5 billion following our successful Hong Kong IPO.

This solid capital position gives us the firepower to invest decisively into R&D, SG&A, and go-to-market capabilities. We are confident that this stepped-up investment will accelerate our pace on large-scale commercialization and deliver faster revenue growth in 2026.

Looking ahead, we are crystal clear on our strategic priorities: tripling our robotaxi revenue, expanding our fleet target to over 3,000 vehicles, and deploying robotaxi to more than 20 cities globally by 2026. We have ample dry powder to support these initiatives, and we will drive progress through our dual-engine growth strategy.

Combined with our joint fleet deployment model that optimizes capital efficiency, we are well positioned to accelerate these targets and turn our operational momentum into sustained profitable and long-term growth for our shareholders. I will now turn the call over to the operator to begin our Q&A session.

Thank you.

Hi, this is Ming from Bank of America, and thank you for giving me the opportunity to ask a question. My only question is that since you already have a target over 3,000 robotaxi fleet by the end of 2026, can you share your production ramp-up and deployment plan?

Now that you have achieved the UE break-even in Shenzhen and Guangzhou, what do you think about the future UE trajectory? Thank you.

This is James. I'll take this one.

In my opinion, I think hitting the UE break-even is a huge win for the whole industry, not just for us. It proves that our technology actually works in the real world.

It also shows that robotaxi is not just feasible, but profitable at scale. Right after the UE break-even in Guangzhou, we did it again in Shenzhen.

This shows that our model is actually replicable, and we achieved this break-even by focusing on service value, not the discounting. What we have seen is that in the regulatory front, currently we do see there's a policy tailwind to support the whole industry.

In China, there's a coordinated efforts between the central and local governments to bring robotaxi services to many cities. In our existing markets of the Tier 1 cities, I also have seen there's more licenses were issued to facilitate a larger fleet.

Globally, many countries learn from the progress in China and the US to clear the policy hurdles and come up with regulations to support accelerated deployment. The regulatory momentum gave us confidence to actually replicate our current success in many more markets, both globally and in China.

Therefore, to capture the market, two things we're focusing this year. One is ramping up production, and the other is launching robotaxis in many more markets.

On the fleet ramp-up over the last 2 months, we've been focusing on producing the Toyota bZ4X, and then we're also continuously producing more vehicles with Beijing Auto and Guangzhou Auto. With all three vehicles, we're confident we'll hit over 3,000 units by the year end.

Then on a fleet expansion, we're pushing deeper into the downtown hubs. Secondly, we are also expanding into new cities, such as Hangzhou, Changsha, and many cities across the Greater Bay Area.

Thirdly, in terms of UE, since the fares in China is relatively low compared with many of the global markets, and in China, we already deliver positive UE, and we're continuously improving the UE. We expect better earnings in our existing markets and definitely a lot better margins overseas.

We plan to expand this year into 20 cities, which can give us a very strong first-mover advantage. Our joint deployment model will also lower our CapEx expenditures, which can help us to accelerate the fleet growth and at least triple our robotaxi revenues this year.

With this, get back to the operator.

Hi, this is Tim from Morgan Stanley. Thanks for taking my questions.

I just have a follow-up question about Pony's latest operational footprint based on the dual-engine strategy management just mentioned. Regarding Pony's expansion strategy to enter over 20 cities this year, could you share details about which cities you plan to enter and what's the split between China and the overseas market?

Separately, with geopolitical tensions escalating in Middle East, are you seeing any challenges or headwinds to your operation? That's my question.

Thank you.

This is James again. I'll take this one.

Strategically, we're definitely using our success in China as a blueprint for our global expansion, because our technology and the business model are proven. We can replicate broadly in the global markets.

In fact, we expect nearly half of the 20 cities we're targeting in this year to be overseas, spanning in Asia, Europe, and the Middle East. In terms of go-to-market strategy, we're teaming up with industry leaders to improve our joint deployment model, which can greatly reduce our CapEx expenditure.

This helps us scale efficiently while at the same time building a strong local networks. We're already launched in Zagreb, Doha, Dubai, and Singapore, partnering with global giants like Uber, Bolt, and Stellantis.

One example is together with Uber and Verne, we actually have launched the first commercial robotaxi services in Europe. Looking ahead, we're certainly exploring more European cities and also doubling down in Asia, such as South Korea and Singapore.

Regarding the last point of your question on our efforts in the Middle East, first and foremost, this region remains to be our high priority. Far, we haven't seen any material impact to our business from the current geopolitical tensions.

We're still charging along with our efforts in the GCC region. We expect to roll out fare-charging services with Mowasalat in Doha, Qatar, and we are getting ready for fully driverless operations in Dubai after approval later this month.

Get back to the operator.

Hi, good evening management. Thanks for taking my question.

My question is on technology. Though world model and the autonomous driving stack are now operating in multiple cities across different countries, could you please tell us more how does the technology generalize to new environments where the conditions could be very different from China?

What role does the world model play in accelerating your extension plan? Thank you.

Oh,

this is Tiancheng. I will take this one.

First and foremost, the key insight is that driving is about interaction and negotiation with dynamic agent around you. There's no difference whether you are in Guangzhou, in Shenzhen, or in Zagreb.

Different cities and countries essentially different combinations of similar scenarios. What varies is the probability distribution, not the fundamental nature of the challenges.

Some example corner cases are reckless lane change without checking mirrors, a fallen bicycle in the road. This corner case occur everywhere.

Our technology has been already validated in the most demanding conditions, operating at scale across all peak hours, all weather, in dense urban cores in China major cities. This means that when we enter a city like Zagreb, we are not starting from scratch.

We are now deploying a system that has already mastered a superset of the scenario city will encounter. This is why we can operate directly in Zagreb's urban core, which carries significant commercial value.

Regarding the second part of your question, our world model plays an important role in accelerating this process. It enables us to model the interaction and the negotiation dynamics between our vehicle and surrounding agents, and to generate large-scale simulated scenarios that reflects the specific traffic patterns of a new market.

By reinforcement learning within this simulating environment, our system continuously improves its driving policy, allowing us to validate and fine-tune efficiently without needing to collect massive amount of data in a new city. The enablers for reaching 20 cities are clear.

Our multi-OEM network provides locally suitable vehicle platforms. Our operational playbook from remote assistance to fleet management is highly standardized and replicable.

Our technology's broad ODD coverage means we can operate in complex urban environment, not just limited low-difficulty routes. Together, this give us strong confidence achieving our target of deploying robotaxi service in more than 20 cities worldwide by year end 2026.

With that, back to operator.

Hi, can you hear me? Hi,

yes.

Hi. Thank you for taking my question, and congrats to the solid results.

My question is about the joint deployment model. For vehicles Pony plan to add this year, can you elaborate a bit more on how you will apply the joint deployment model?

How should we think about the benefit of this model for the company and our value chain partners? Thank you.

This is Leo. I'll take this question.

As you can see that we have hit a critical milestone of UE break-even in Guangzhou and Shenzhen. After that, we've been seeing a lineup of partners in the whole ecosystem that wants to join the robotaxi market, and we are their go-to choice.

In this joint deployment model, our partner funds the vehicle CapEx and start to tapping into the whole robotaxi value chain, for example, ground operation, vehicle maintenance, and charging. We consider this as a win-win situation for both of us.

Our partner gets growing revenue from deployed vehicle, and we essentially are in the asset-light model to expand our fleet rapidly. In this year, we expect nearly half of our new vehicles are coming through this model, and which is led by Toyota.

Not only we improve our capital efficiency in our expansion through this model, but also it will create a additional revenue stream through recurring income from the form of revenue sharing or AI driver license fee. This revenue stream, combined with our self-owned fleet fare-charging revenues, will help us to achieve more than triple robotaxi revenue in 2026.

Beyond the current lineup of our partners, such as Toyota, Ontime Mobility, and ATBB, we actually expect even more partner will jump on board this year. I will get back to the operator.

Hi, thank you for taking my questions, and congratulations on the results. Regarding the 1,000 robotaxis already contracted with Toyota, how do you plan to deploy these vehicles?

Do you expect any further scaling up or strategic initiatives with Toyota down the road? Thanks.

This is James. I'll take this one.

In terms of Toyota, I consider is as not just a partner, they've actually been with us since the 2019 as our largest strategic shareholder. The relationship between us goes way beyond just a auto supplier.

It's actually a deep, strategic, long-term collaboration. In terms of the mass production of robotaxi vehicles, we have jointly launched several robotaxi models on the Toyota platforms since the 2019.

In this year 2026, we are adding 2,000-plus new vehicles, and nearly half will be the new Toyota bZ4X Gen 7 vehicles. This model is jointly developed with Toyota Motor Company and GAC Toyota.

The mass production is already live on Toyota's assembly lines. There certainly is a great synergy between us.

Their manufacturing capability and top-line platforms blend perfectly with our L4 technology and operational know-how. Consider our collaboration, besides the jointly developing vehicles, Toyota is also the first partner to adopt our joint deployment model, funding the fleet to help us scale capital efficiently.

This shows their incredible confidence in Pony, and together we're rolling out commercially, starting from China's top Tier 1 cities. With this, I'll get back to the operator.

Thank you, James. This is Yu-Chien from HSBC.

I've got two. First question is about competition dynamics.

How do you see the automakers getting into the robotaxi segment? Second question is about competitive edges.

Now the narrative is shifting towards more into scaling. With more entrants getting in, what's Pony's most unique, leading advantage?

Thank you.

Sure, I'll take the first one, and I'll hand over to Tiancheng for the second part. Certainly, we have seen that especially lately, there are many announcements about new players already entered or plan to enter the robotaxi business.

Those new entrants including automakers, ride-hailing companies, tech giants, or even startups. In general, I think this new entrants to the robotaxi space validates the long-term potential for our industry.

I certainly very much welcome the new players. Essentially, they can make the whole ecosystem to be even larger.

In reality, L4, especially robotaxi, is such a complex systems that it requires a integrated solution. As I mentioned in my prepared remark, there are five pillars for the robotaxi industry, namely technology, policy, mass production, operation, and partnerships.

These five pillars are so intertwined that simply throwing resources at them will not accelerate the development process. Over the years, we actually have developed a unique advantage on all aspects of the robotaxi industry.

Regarding some of our competitive moat, I'll hand over to Tiancheng to elaborate.

Thank you. This is Tiancheng.

Technically, I do not think automaker have an advantage in L4 robotaxi just because they are strong in manufacturing or in L2 systems. The key point is that L2 and L4 are fundamentally different.

They are not just two points on the same path. In L2, as the miles per intervention increases, the actual risk can increase.

Partial automation can create a false sense that the system is almost good enough until it fails in a situation where the human is no longer ready to take over. That is why the L2 path does not naturally lead to L4, especially when you're talking about a driverless fleet at scale.

One unique advantage we have at Pony AI is our long-term investment in our world model and our L4-native virtual driver training approach. The reason this matters is that L4 robotaxi need to be significantly safer than human drivers, and that cannot be achieved by simply imitating human driving behavior.

To reach that level of safety, the system have to keep improving through large-scale trials and errors in a virtual environment, which is why a world model is essential. In other words, the key to train a L4 virtual driver is building a virtual environment with strong enough sim-to-real capability, especially when it comes to interaction between vehicles.

That is also why the L4 approach requires many years of investment in AI, and it does not improve merely by collecting more real-world data. The second unique advantage is that we have real robotaxi fleet in operation.

Those fleet continuously help us see where the world model is still different from the real world. The hardest part of L4 is not the first 99%.

It is the last 1%, the long tail and rare, but safety-critical corner cases. To handle those cases safely, it is not enough to look at one recorded trajectory.

What really matters is understanding how other vehicles and pedestrians may behave across many different intentions with the AI driver. This is exactly why the world model is so important.

Only a world model can give you enough coverage of the full combination space of different intentions in corner cases. That kind of coverage is what L4 safety ultimately requires.

At the same time, only fully driverless robotaxi can keep narrowing the gap between the world model and the real world. Real-world robotaxi operations let us observe and understand actual behavior pattern of vehicles and pedestrians in those scenarios where human driving data cannot observe interaction with robotaxi.

This is also aligned with the fact that new players typically can only start with a very small fleet. Regulators understand this logic as well, they are naturally very cautious about granting permits at early stage.

To summarize, automakers enter the space confirms the size of the opportunity, but L4 robotaxi is not something you get by expanding L2. Pony AI's unique advantage comes from two things: a world model built for L4, and a real robotaxi fleet that continuously help to improve it.

Together, they create a closed loop that keeps both the model and the product moving forward. With this, back to operator.

Thanks for taking my question. This is Joel from Nomura.

I would just like to understand, how do management view the impact of NVIDIA launching their open-source model for smart driving as well as Level 4 during this CES this year, also GTC? Thank you.

This is Tiancheng again. For this question, I think the key is to distinguish between a model and a real product.

An open-source autonomous driving model can be a good starting point, but not the end product. There is still a very big gap between a model and a robotaxi fleet that is commercially deployed, safety-proven, government-approved, and operating at scale.

Closing that gap is exactly where our core advantage lies. At Pony, our strengths come from years of full-stack in-house development and real L4 deployment at scale.

That includes not just the software or the model, but also the vehicle architecture, sensor redundant design, domain controller, operating system, validation, and commercialization capability need to run an actual robotaxi service. For example, sensor customization and redundant design directly affect safety, manufacturability, and BOM cost.

Our OEM partners are also very different from a plug-play approach that give us better system integration, higher reliability, and lower overall system costs. We view progress from NVIDIA help move the ecosystem forward.

At the same time, we believe the real barrier to entry remains very high. Of course, NVIDIA is an important partner of ours on domain controller, and we maintain a strong collaborative relationship.

With this, back to the operator.

Hi, thank you. Tianyu from CITIC Securities.

Thanks for taking the question, and congratulations on rapid growth in robotaxi service. I have a question.

How are you planning to allocate your Hong Kong IPO proceeds? Given your accelerated development targets, do you expect any upward revisions to the 2026 cost and expenditures?

This is Leo. I'll take this question.

As I mentioned earlier, we have ample cash reserve, about $1.5 billion as of December 31st in 2025, which was driven by our Hong Kong IPO proceeds, which we get a proceeds of more than $800 million. This definitely secures a long-term capital to fuel multiple-year growth.

For us, the 2025 achievement in terms of Gen 7 production, deployment, and the UE break-even made us a clear industry leader. Looking forward, we look for accelerated top-line growth to widen our leading position and also push the whole industry towards the next stage.

Hence, we need to strategically increase our investments. We've significantly scaled up the number of robotaxi operating across China's Tier 1 cities, especially in Shenzhen and Guangzhou.

We also recently entered into new cities in China, such as Hangzhou, Changsha, and internationally in Croatia, and plan to deploy in more than 20 cities by this year. In order to support the multiple-market expansion, we will invest in business development, operation, and marketing.

As we scale our robotaxi deployment, we are expanding our robotaxi fleet through joint deployment models as well as investment in self-owned vehicles. We will also recruit AI talents and invest in AI infrastructure to further improve our virtual driver capability.

We think this would allow us to consistently meet public high expectations for safety, reliability, and quality, to offer a trusted robotaxi service. James already mentioned that this is a critical period to expand market share, which we think it requires necessary investment to solidify our technological and operational moats.

We believe the strategic increase in the investment is a value-driven trade-off to secure long-term market leadership. We believe with disciplined capital allocation and also the benefits from joint deployment model, it will be paid off with much faster growth, city expansion, and fleet size.

I also believe this will also lead the whole industry into a much advanced phase. Thank you, and I now get back to the operator.

Thank you. This is Kai from CICC.

I have one question regarding the raw materials inflation, such as memories. Could you share your view how does the inflation impact your production plan and cost items?

Thank you.

This is Leo again. I'll take this question.

Thank you for asking this important question. As I mentioned in the earlier speech, the impact on both vehicle and ADK BOM cost is very limited.

We think this resilience is driven by our proactive supply chain strategy and inventory synergy with our ADC domain controller business. Through this approach, we actually have secured our memory supply even before the market went into price inflation and shortages.

We are very confident that we can fully support this year's robotaxi production target of over 3,000. Thanks to the supply chain measures and our continuous scaling, we remain on track to achieve a 20% reduction in ADK BOM cost for 2026 compared to 2025 levels.

We will carry out ongoing hardware-software optimization, and this will further reduce our overall BOM cost down the road. Thank you, and I'll get back to the operator.

Thank you once again for joining the earnings call today. If you have any further questions, please feel free to contact our IR team.

We look forward to speaking with you in the next quarter.