Thank you, operator. Hello, everyone, and welcome to LightInTheBox's second quarter 2026 earnings conference call.

The company's earnings results were released via Newswire Services earlier today and are available on the company's IR website at ir.ador.com. On the call from LightInTheBox today are Mr.

Jian He, CEO, and Mrs. Wendy Liu, CFO.

Mr. He will provide an overview of the company's Q2 highlights, followed by Mrs.

Liu, who will go over its financial results. Following our prepared remarks, we will open the call to questions.

Before we proceed, please note that today's discussion may contain forward-looking statements made under the safe harbor provisions of the US Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from the company's current expectations.

To understand the factors that could cause results to materially differ from those in forward-looking statements, please refer to the company's Form 20-F filed with the SEC. The company does not assume any obligation to update any forward-looking statements except as required under applicable law.

Please also note that LightInTheBox earnings press release and this conference call include discussions of unaudited GAAP financial measures, as well as unaudited non-GAAP financial measures. Please refer to the company's earnings press release, which contains a reconciliation of the unaudited non-GAAP measures to the unaudited GAAP measures.

Now, I'd like to turn the call over to LightInTheBox CEO, Mr. He.

Please go ahead.

Good morning and good evening, everyone. Thank you for joining LightInTheBox second quarter 2026 earnings call.

We are pleased to report excellent results for the first half and the second quarter of 2026. Our first half results provide a clear view of the progress we are making.

Revenue increased 3% year-over-year to $108.8 million. Net income grew by approximately 28% to $2.7 million.

Adjusted EBITDA also improved to $3.3 million. In the second quarter, revenue declined modestly as we phased out long-tail products.

Despite a challenging external environment, gross margin remained resilient at 66%. Through disciplined expense management, we remained profitable, delivering net income of $1.6 million and adjusted EBITDA of $1.9 million.

Over the past several years, we have steadily reshaped LightInTheBox and laid the foundation for sustainable, profitable growth. From 2023 to 2024, we invested in our proprietary apparel brands and strengthening our in-house product development and production capabilities.

These investments gave us greater control over product differentiation, quality, and speed to market. In 2025, we made meaningful progress in evolving the LightInTheBox online platform into a consumer lifestyle company.

By developing a deeper understanding of consumer preference and sentiment, we delivered differentiated products that fostered engagement and built a stronger emotional connection with consumers. This year, we are seeing another important shift.

AI is rapidly becoming embedded in how people work, communicate, create, and make decisions. We believe it will transform not only how consumers discover, evaluate, and purchase products, but also what they value and seek in their daily lives.

As technology becomes more deeply integrated into everyday life, we believe the desire for emotional connection, self-expression, and ultimately, a better quality of life and memorable experiences will become even more important. As a lifestyle company, we are well positioned to address these evolving needs.

Our transformation for the AI era goes beyond adopting new technology tools. It requires a deeper understanding of consumer intent.

Our AI strategy will focus on using technologies to anticipate evolving consumer needs and connect them more effectively with product discovery, personalization, and creation. At the same time, we will continue to evolve our product strategy around enduring human aspirations for self-expression, emotional value, and memorable experience.

With that, I will now hand the call over to Wendy to go through our financial results.

Thank you, Mr. He.

Good morning and good evening, everyone. Before we go over our financials, please note that unless otherwise stated, all figures are presented in US dollars.

In the second quarter, our total revenues were $57 million, a modest 4% decrease year-over-year as we deliberately phased out long-tail products. This quarter was affected by a challenging external environment.

Geopolitical disruptions increased pressure on cross-border logistics and related costs, while the weaker US dollar created additional foreign exchange headwinds for our global operations. Despite these factors, gross margin remained very stable at 66.1% compared with 65.9% a year ago, reflecting our continued efforts on higher-margin lifestyle products.

Total operating expenses in the second quarter decreased by 4% year-over-year to $35 million, of which fulfillment expenses decreased by 3% to $4 million, selling and marketing expenses decreased by 4% to $27 million, and G&A expenses decreased by 5% to $5 million. Total operating expenses as a percentage of revenue decreased from 63% to 62%.

Our net income in the second quarter reached $1.6 million compared to $2 million in the same quarter last year. This concludes my remarks.

We are now open to your questions. Operator, please continue.

Hi, team. Thanks for taking my call.

I have questions relating the two topics. Two topics are insider ownership and your brand matrix strategy.

I'll start with the first topic. I would appreciate if you could provide an update on how many shares are in the public float and how much do insiders own of the company.

Hi, thank you for your question. Related to insider share percentage, you may refer to our IR website for more details.

Okay.

there's another question.

There's another question from Cyril [I see?] .

Yes, I'll go ahead and ask. My second question was concerning the brand matrix strategy.

At an investor conference earlier this year, the company stated that its three brands are Ador, Misg ग्लैमर, and Airsky, and I was wondering if you could provide any details about any of the brands. Also, you mentioned potentially adding maybe 1 to 2 brands a year if you find the right market.

Just would appreciate any thoughts about plans for new brands in this year or the next. Thank you.

Thank you for your question. For this three brands, we do see good progress in terms of top line as well as bottom line, and we do see repeated purchase rate are increasing.

This three brands are progressing really good. At the same time, we're preparing other brands as well to enhance the brand matrix.

Thank you.

Thank you.