“I don’t know exactly how many a single person can do, but it’s not going to be more than probably 30 an hour, maybe 45,” said Lore, who spoke at the 25th annual Fortune Brainstorm Tech conference in Aspen on Tuesday. Lore previously sold two businesses, Diapers.com and Jet, to Amazon and Walmart, respectively, for $3.8 billion before founding food-tech startup Wonder in 2018, where he serves as chairman and CEO. 

The automated infinite bowl technology, which Wonder acquired from salad chain Sweetgreen, spins each bowl on a turntable while ingredients drop into place, based on the specs from an online delivery app order. The resulting bowl, said Lore, has “no errors,” so a hungry patron gets exactly what they ordered. Lore said Sweetgreen already runs the infinite bowl tech across 32 locations, and it will land in its first Wonder kitchen next month.

Lore described Wonder as a “vertically integrated food platform” that owns 26 restaurant brands including a Bobby Flay steakhouse and delivery options that include fried chicken, pizza, Chinese, and Thai food. Wonder also owns and manages the kitchens, and handles delivery after buying GrubHub in a deal valued at $650 million that closed in 2025. By combining all the different brands in a single kitchen, Lore said Wonder can serve geographies and regions that don’t have the population numbers to support larger fast-casual chains like Chipotle or Cava. 

With everything included in a single profit pool, Lore claims, the prices are less expensive because the margins don’t need to support both restaurants and delivery companies. A single 10-ounce Bobby Flay steak “cooked to perfection” costs $36 and bowls are under $10, he said.

“We can stay open until 2 a.m. in the suburbs because we can operate all 26 restaurants with three people late night,” Lore added. One human staffer answers the hotline, another handles finishing the dishes, and the third works the handoff to delivery drivers. 

More from Fortune’s 25th Brainstorm Tech:

Anthropic’s Boris Cherny, creator of Claude Code, says there are days he manages tens of thousands of AI agents at once

Tesla cofounder: ‘We should be really worried’ about the U.S. grid as China speeds ahead in the power race

‘Getting control where we can’: Europe wants sovereign AI, but most of the chips are from the U.S.

Lore wants this business to have an indelible impact on the public company landscape and is pursuing an IPO, something that has eluded him, he told “The Aisle” founder Jason Del Rey.

“We are going to be ready to go public early next year,” said Lore, although the market will likely help dictate the timing of a potential public offering. 

Lore, who also owns the Minnesota Timberwolves and Lynx basketball teams, said he wants to builds a “long-standing, legacy business that becomes a household name” with Wonder, and he said it has a competitive moat that AI can’t disrupt. And more machines are on the way. An “infinite sauce machine” can spin up 500 sauces an hour from 152 raw ingredients, said Lore, and an “infinite beverage machine” is slated for next year.

From there, Lore said he expects that some people will want to start their own delivery-based restaurants using Wonder. Through a feature he called Wonder Create, Lore said anyone can describe a concept in an AI prompt like, “build me a fast-casual Mexican restaurant for Gen Z, for people that love cycling.” From there, Wonder will output a branded restaurant concept, with its own name, menu, pricing, photos and nutrition information, built on Wonder’s automation in about two minutes. Lore said users can push their concepts live for $10 a month. 

“Think Shopify on steroids,” Lore says. “You don’t have to do anything.”

DATE

Tuesday, June 9, 2026 at 8 a.m. ET

CALL PARTICIPANTS

• Founder, Chairman, and Chief Executive Officer — Huazhi Hu
• Chief Technology Officer — Shuai Feng
• Chief Operating Officer — Zhao Wang
• China General Manager — Li Xiaona
• Chief Financial Officer — Conor Yang
• Investor Relations Director — Anne Ji

TAKEAWAYS

• Revenue — RMB 25.7 million, nearly flat compared to RMB 26.1 million in Q1 2025, but down from RMB 177.6 million in Q4 2025 due to lower eVTOL unit deliveries.
• eVTOL Deliveries — Four EH216-S units delivered, compared with 11 in Q1 2025 and 61 EH216 plus five VT35 units delivered in Q4 2025; management attributed the decline to seasonal factors and customer delivery schedules.
• Aerial Media Revenue Contribution — Approximately 40% of total revenue was from the Aerial Media business, reflecting significant revenue diversification.
• Gross Margin — 62.5%, marginally higher than 62.4% in Q1 2025 and up from 61.6% in Q4 2025; attributed to manufacturing efficiency and supply chain improvements.
• Adjusted Operating Expenses — RMB 101.1 million, up 59% year over year and up 7.9% from Q4 2025, primarily from commercialization, R&D team expansion, and increased technology investment.
• Adjusted Operating Loss — RMB 77.1 million, compared to RMB 42.6 million in Q1 2025, reflecting higher expenses and lower revenue.
• Adjusted Net Loss — RMB 75.6 million, versus RMB 31.1 million in Q1 2025.
• Total Cash Position — RMB 1.03 billion as of March 31, 2026, comprising cash, cash equivalents, restricted cash, short-term deposits, and short-term/treasury investments.
• 2026 Revenue Target — Management reiterated confidence in the RMB 600 million full-year revenue target, based on diversified business lines and anticipated ramp-up from new and existing customers.
• Revenue Mix Outlook — Management stated that “human-carrying business…will contribute 60% of our revenue,” and non-human-carrying businesses “are going to contribute roughly 40% of our revenue” for the year.
• Overseas Revenue — Management said, “The proportion of the overseas revenue will increase significantly,” with expectations for up to 10% of total revenue, closely tied to commercial operation progress in Thailand.
• Aerial Media Gross Margin — Management stated, “That is around 50%,” referring to the margin profile of the GD 4.0 flight performance segment.
• Q1 GD 4.0 Performance — Delivery of 1,000 GD 4.0 formation drones and completion of 22 drone formation performances in the quarter.
• EH216-S Operations — Hefei and Guangzhou sites have completed over 3,000 accident-free flights, maintaining “a perfect safe record, 0 accidents and 0 violations” since March 2025 OC issuance.
• Product Certification Status — EHang (EH 23.31%) has obtained TC, PC, AC, and operator certificates for commercial operation; VT35 certification is progressing with system and performance tests completed in Q1.
• Brand Milestone — In February, EHang set a new Guinness World Record with 22,580 GD 4.0 formation drones at a national Spring Festival Gala, significantly increasing brand visibility.
• Share Repurchase Program — Board authorized up to USD 30 million in ADS repurchases over the next 12 months, to be funded from existing cash reserves.

Need a quote from a Motley Fool analyst? Email [email protected]

RISKS

• Management stated, “our near-term profitability was impacted by lower revenue scale and higher R&D expenditure,” and “Adjusted operating loss in Q1 was RMB 77.1 million compared to RMB 42.6 million in Q1 2025.”
• eVTOL deliveries declined sequentially and year over year, as CFO Conor Yang reported, in part due to “seasonal factors at the beginning of the year and the customer delivery schedules.”
• COO Zhao Wang noted, “The year over year and sequential decline in eVTOL deliveries was mainly due to the seasonal impact of the Chinese New Year holiday and customer delivery timing.”
• Intensifying low-price competition in the formation drone segment with management noting the industry “is seeing increasingly intense low price competition” and stating a strategy to avoid price competition in this segment.

SUMMARY

The management emphasized a material transition from certification to commercial operations, supported by China’s new legal framework underpinning the low-altitude economy and direct government backing. Regulatory milestones included passage of the revised Civil Aviation Law and the establishment of new institutional structures, which management characterized as accelerating rather than hindering industry maturity. Company-level strategic focus areas are expanding commercial operations of EH216-S, progressing VT35 certification, overseas expansion with a concentration on Thailand and Mexico, and enhanced integration across R&D, manufacturing, and support infrastructure. Product upgrades featured deployment of a new battery cooling vehicle and cabin comfort enhancements, facilitating higher-frequency EH216-S flights and increased utilization. EH216-S accumulated 90,000+ safe flights globally with no accidents or violations, reinforcing operational credibility and providing a foundation for entering ticketed commercial service upon regulatory approval.

• Management’s overseas strategy prioritizes rapid certification via bilateral agreements and dedicated market-entry teams with five vertiports identified in Thailand and first route survey completed.
• More than 40 domestic eVTOL operational sites are now established, with small-scale commercial trials in tourism hotspots designed to generate safety data for regulator submissions.
• Framework for crew training and operator certification is progressing, with internal instructor training on schedule for completion by late June and batch ground crew training ready to begin after CAAC approval.
• Company plans phased launches of firefighting and inland waterway logistics products, leveraging pilot trials and government procurement processes to unlock additional addressable markets.
• Management expects a majority of 2026 orders—and over 50% of annual revenue—to be driven by new customers, with H2 as the principal period for order realization due to public-sector procurement cycles.
• Investor return is addressed by initiation of a flexible share repurchase program, capped at USD 30 million from existing cash, reflecting confidence in the company’s long-term prospects.

INDUSTRY GLOSSARY

• eVTOL: Electric Vertical Take-Off and Landing aircraft, an emerging class of urban air mobility vehicle capable of pilotless operation and intended for both passenger and logistics use cases.
• TC, PC, AC, OC: Respectively, Type Certificate, Production Certificate, Airworthiness Certificate, Operator Certificate—critical regulatory milestones for aircraft commercial operation.
• VT35: EHang’s longer-range, pilotless, human-carrying eVTOL under development for future intercity and regional air mobility applications.
• GD 4.0: EHang’s formation drone platform, used for commercial aerial light shows and media performances.
• VTC: Validation of Type Certificate, a regulatory process enabling the recognition of aircraft type approvals across international markets.
• CAAC: Civil Aviation Administration of China, the government body responsible for aviation regulation in China.

Full Conference Call Transcript

Anne Ji: Hello, everyone. Thank you all for joining us on today’s conference call to discuss the company’s financial results for the first quarter of 2026. The earnings release is available on the company’s IR website. Please note that the conference call is being recorded, and the audio replay will be posted on the company’s IR website. On the call today, we have Mr. Huazhi Hu, our Founder, Chairman and Chief Executive Officer; Mr. Shuai Feng, Chief Technology Officer, Mr. Zhao Wang, Chief Operating Officer; Ms. Li Xiaona, China General Manager; and Mr. Conor Yang, Chief Financial Officer. Before we continue, please note that today’s discussion will contain forward-looking statements made pursuant to the safe harbor provisions of the U.S.

Private Securities Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, the company’s actual results may be materially different from the expectations expressed today. Further information regarding this and other risks and uncertainties is included in the company’s public filings with SEC. The company does not assume any obligation to update any forward-looking statements, except as required under applicable law. Also, please note that all numbers presented are in RMB and are for the first quarter of 2026, unless stated otherwise. With that, let me now turn the call over to our CEO, Mr. Huazhi Hu. Please go ahead, Mr. Hu. Thank you.

Huazhi Hu: [Interpreted] Hello, everyone, and thank you for joining our earnings call. In the first quarter of 2026, EHang is navigating a critical transition from certification to commercial operation. We are fully committed to launching the world’s first pilot-less human carrying eVTOL into commercial service. Today, I’d like to share updates from two perspectives, the fundamental shift in regulatory environment and progress on our four core strategies. First, policy and industry developments. The biggest change in Q1 was institutional. The low-altitude economy now has a solid legal foundation and policy anchor we’re moving from the policy concept stage to one truly governed by law.

On the legal front, the newly revised Civil Aviation law was passed in January and will take effect on July 1. And formally recognizing the low-altitude economy for the first time. On the regulatory front, the CAAC has established a new low-altitude safety bureau while the NDRC and CAAC have formed a 2-tier governance model with the NDRC providing top-level coordination and the CAAC handling industry-specific implementation. Separately, China’s State Administration for Market Regulation together with 10 government departments in China have jointly issued the low-altitude economy standard system development guide aiming to establish a basic standard system by 2027. Some worry that more regulations may slow the industry down.

I believe the opposite, this is a positive development, a clear regulatory and standard framework helps everyone in the industry move faster and more properly. As a pioneer, EHang is turning our certification and talent development know-how into building blocks for industry standards. These first-mover advantages not only contribute to industry development, but also strengthen our long-term competitive moat. Meanwhile, state-owned enterprises and local governments are accelerating their deployment low-altitude economy has been featured in the government work report for 3 consecutive years and is now designated as one of the six emerging strategic pillar industries under China’s 15th 5-year plan. More cities are actively planning aerospace, building vertiports and rolling out subsidy programs.

And the altitude industry ecosystem is accelerating toward maturity. Now let me turn to progress on our for core strategies for this year. Routine, commercial operations, global expansion, VT35 certification and industrial chain integration. First, routine and scale to commercial operations remain our top priority. We have cleared a certification hurdle and are now fully focused on the commercial operation hurdle we have obtained TC, PC and AC and our two operators holds OCs. Over the past year, we have continued to refine the entire operational chain, ticketing insurance, aerospace, approval, maintenance, charging infrastructure, crew training and command and control systems to launch the world’s first commercial pilot-less human-carrying eVTOL service.

We are now working closely with the regulator to fine-tune our operational capabilities and make the final push from internal trial operations to public ticketed service. That day will not be far away. The market demand is real. Take our RMB 299 experienced ticket as an example. We continue to receive a large volume of inquiries asking when can I buy a ticket and take a flight. This reflects a strong public enthusiasm for eVTOL commercial flights. Importantly, our operational capabilities extend beyond passenger vehicles. Our formation drone fleet has use of proven experience in February, our new GD 4.0 drones completed 22,580 units of formation flights, setting a Guinness World Record.

In Q1, the proportion of revenue from the aerial media solution increased noticeably. The experience processes and teams, we have built through these large-scale, highly reliable unmanned aircraft operations will directly benefit EH 216 commercialization. As the same goes, the last leg of the journey marks the halfway point. Obtaining the 4 certificates was only the first half the real second half is the commercial operation. In the global eVTOL industry, EHang remains the only company with TC, PC, AC and the license for commercial operations. The first-mover advantage here is not a short sprint nor a manufacturing race. It is an operational race who can run a safe, sustainable commercial model. Second, deepening our global footprint.

We are making steady progress overseas. The Thailand AAM Sandbox program continues with the routine validation flights to address hard weather conditions, we completed a battery cooling vehicle testing in Thailand and Guangzhou this month. Adding independent quoting systems that significantly improved charging efficiency in a passenger comfort. We are also actively working with Civil Aviation Authority of Thailand to issue EH216-S first overseas operating license. Our experience in Thailand Sandbox has become an important reference for our global expansion. Third, accelerating VT35 certification and commercialization. Certification for VT35, our new longer-range pilotless human-carrying eVTOL is progressing steadily.

In Q1, we completed multiple system functions and flight performance tests and held in-depth discussions with the CAAC on certification basis, our VT35 was for future intercity and regional air mobility enriching our product portfolio. At the same time, we are developing non-human-carrying models, including fire fighting and logistics for more application scenarios to further expand our addressable market. Fourth, strengthening industrial chain integration. We are turning our first-mover certification and ecosystem experience into industry consensus. EHang is not only China’s leader in pilotless human-carrying eVTOL certification, but also the earliest practitioner and contributor to national and industry standards for unmanned aircraft in China.

As the world’s first mover about to enter routine commercial operation, we are taking steady steps to strengthen our operational capabilities and build a compliance mode. And at the same time, we are integrating R&D, manufacturing, supply chain and quality systems to improve and an efficiency and scale delivered capabilities. In closing, I want to reiterate the low-altitude economy is a long-term strategic arena with the deep potential. EHang will never lose sight of safety, compliance and operational quality. We’re committed to being long-term players who shape eVTOL industry standards with craftsmanship so that China developed in China operated pilots eVTOL will continue to lead the global low-altitude mobility market.

I will now turn the call over to our CTO, Shuai Feng. Thank you.

Shuai Feng: [Interpreted] Thank you, Mr. Hu. Hello, everyone. Hi, I’m Shuai Feng. In Q1 2026, our work focused on three priorities: product R&D and upgrades, certification progress and commercial operation support. On one hand, we accelerated VT35 development and certification. On the other, we continue to optimize the EH216-S performance operational efficiency and passenger experience to support upcoming operations, strengthening the foundation for scale deployment. Number one, VT35 progress. VT35 R&D and certification progressed steadily in Q1. The program has now entered a certification basis definition stage where we are working closely with the CAAC to establish the safety evaluation framework. We’re engaged in-depth discussions on special conditions, safety objectives and performance requirements.

On the engineering side, critical ground and flight tests are advancing as planned to validate system functionality, flood performance and safety redundancy. Meanwhile, the VT35 avionics system has entered a detailed design stage, preparing for certification prototype manufacturing and conformity verification. Building on the EH216-S certification experience and our eVTOL technical expertise we are advancing VT35 efficiently, laying the groundwork for future intercity and regional air mobility. Number two, EH216-S performance upgrade. This quarter, we focus on hot weather operational efficiency and passenger experience through targeted upgrades to better thermal management and cap and comfort systems. On operational efficiency to address battery thermal management challenges during high-frequency takeoffs and landings, we developed a dedicated battery cooling vehicle.

It has completed production testing and is undergoing further optimization. The cooling vehicle significantly shortens battery cooldown time from high temperatures to safe operating levels, increasing daily charging cycles and flight volume. In field tests, the cooling vehicle doubled EH216-S utilization, directly supporting higher frequency commercial flights. The unit can be quickly deployed across operational sites, providing flexible and reliable thermal management for large-scale high-density operations. On passenger experience, we upgraded the cabin air conditioning system. The new independent and cooling system is separate from flight control and AvNOx circuits.

So it doesn’t interfere with the critical functions while improving comfort in tests, the system quickly reduces cabin temperature after prolonged sun exposure and maintains a comfortable level throughout the flight. This upgrade directly addresses a key pain point in hot climates, improving passenger experience, commercial reputation and market acceptance. Number three, digital infrastructure for low-altitude operations. Our Guangzhou Command and Control Center is now fully operational, supporting passenger, firefighting, logistics and formation drones. It provides integrated capabilities, including aerospace management, flight planning, dispatch approval, real-time monitoring, operation records and risk alerts. In Hefei, the command and control system has been deployed and is connected to the city’s low-altitude sensing network and EHang’s operational data.

Together, these platforms establish a solid foundation for regional scaled, low-altitude operations management. Number four, new product development. We are also actively advancing the R&D and fly testing of new products, including logistics and firefighting aircraft further expanding our product portfolio and low-altitude economy applications. Under our CEO, Mr. Hu’s leadership, I will continue to lead our team in advancing product iteration with aviation grade standards, translating technological progress into commercial value efficiently and providing a strong foundation for EHang’s long-term growth. I will now turn the call over to our COO, Zhao Wang, for sales and operations update. Thank you.

Zhao Wang: [Interpreted] thank you, Mr. Feng. Hello, everyone. I am Zhao Wang. As EHang enters a new phase of commercial operations, I want to introduce a new member of our management team, Ms. Li Xiaona, formerly our Vice President and General Manager of East China has been promoted to China General Manager, she will lead our sales, operations and marketing teams overseeing business development and operations management in both China and overseas markets. Over the years, Li Xiaona has led our East China team to build our presence in Hefei from the ground up.

She established Hefei aviation secured its operator certificate built a highly effective operational system and team with strategic industrial layout covering R&D, manufacturing and commercial operations and delivered outstanding results. I look forward to seeing the Hefei model scale further under her leadership. Now let me walk you through our Q1 business results and strategic plans. In Q1 2026, we achieved revenues of RMB 25.7 million. We delivered four units of the EH216-S and 1,000 units of the GD 4.0 formation drones and completed 22 drone formation performances. The year-over-year and sequential decline in eVTOL deliveries was mainly due to the seasonal impact of the Chinese New Year holiday and customer delivery timing.

Look at our revenue mix, our Aerial Media business grew faster and contributed approximately 40% of the total revenue in Q1. The parallel development of our multiple business lines is driving revenue diversification, reflecting continued demand growth across low-altitude application scenarios. Looking ahead to the full year, we remain confident in our 2026 revenue target of RMB 600 million. This will be supported by the progress we have made on three strategic initiatives. First, diversified revenue streams beyond passenger eVTOL sales and operations, our non-human-carrying businesses, including Aerial Media, firefighting solution and command and control systems are expected to become new growth drivers. Second, continued overseas expansion.

We expect to replicate our overseas model that combines regulatory sandbox program, local partners and our integrated operational capabilities to drive sales and operations in Thailand and other global markets. Third, advancing domestic commercial operations, Preparation for EH216-S commercial operations have entered the its final stage. We’re working with the CAAC on the last mile of commercial operation. We’ll continue to prioritize both sales and operations, ensuring steady and compliant commercialization progress. I will now turn the call over to Li Xiaona for a detailed review of our Q1 execution. Thank you.

Li Xiaona: [Interpreted] Thank you, Mr. Wang. Hello, everyone. I’m Li Xiaona. I’m pleased to join the earnings call for the first time. Let me walk you through our Q1 results, operational strategy and future plans. In February, we featured 16 EH216-S aircraft and 22,580 GD 4.0 formation drones and the CMG 2026 Spring Festival Gala Hefei have segment. We completed a flawless performance and set a new Guinness World Record. This appearance significantly enhanced our brand awareness and industry visibility helped to intoduce the concept of low-altitude mobility to a broad public audience and demonstrated our leadership in fleet flight, remote dispatch and communication integration strengthening our brand foundation for commercial partnerships and market expansion both at home and abroad.

As of May 2026, the EH216-S Series has accumulated over 90,000 safe flight globally in 21 countries. This long-term stable, safe track record is our core competitive advantage in global market expansion. Overseas, we have achieved multiple milestones completed first human-carrying flight in Mexico, Latin America and trial flight permits in Thailand, Japan, South Korea and Middle East and Spain. On overseas strategy, we made a strategic adjustment this year, making VTC our top priority to fully open the commercial pathway in overseas markets. Given how civil aviation regulations work, we plan to leverage China’s existing bilateral air worthiness agreements with 32 countries for our certification applications. Thailand is our first flagship overseas market.

Five vertiport locations have been identified and the first route survey has been completed. We have adapted our hardware, including batteries and outboard air conditioning for hot and humid tropical environment and are pushing hard on commercial operation permit progress. We have formed a dedicated overseas team integrating R&D, commercial airworthiness and communications functions. Going forward, we will systematically map out our bilateral civil aviation policies globally and develop differentiated overseas deployment plans for human-carrying and cargo aircraft, targeting key markets one by one. On domestic human-carrying air mobility network continues to expand. To date, our customers have built over 40 eVTOL operational sites across China, some of which are already in routine operation.

This year, we are shifting our business focus to high-demand tourism scenarios using light asset models such as equipment leasing joint operations and direct sales to lower the barrier for partners while putting existing aircraft to fly. We are prioritizing locations with high foot traffic and natural commercial appeal, such as Daoli, [Wencheng] and Taishan, running small-scale trials to accumulate safety data then progressively helping customers apply for operator certification. To improve project executing efficiency, we have set up a dedicated sales support team that works alongside frontline teams, to develop customized integrated operation plans based on local aerospace conditions, tourism resources and the commercial landscape.

On commercial operation preparation, the CAAC has raised the requirement for the world’s first pilotless human-carrying eVTOL commercial operation with higher and more detailed standards. At this stage, our two OC certified operators in Hefei and Guangzhou continue to refine their operations systems ground support, crew training and emergency procedures while running internal trial operations routinely and accumulating flying data and service experience. Since obtaining their OCs in March 2025, both operators have maintained a perfect safe record, 0 accidents and 0 violations. As domestic benchmarks, EHang General Aviation and Hawaii Aviation have completed over 3,000 of EH216-S flights. We have built a complete end-to-end service system covering ticket pricing, online and off-line ticketing channels, customer service and complaints handling.

Service capacity is being expanded in phases. Going forward, we’ll continue to refine our standardized SOPs for passenger services, ticketing management and vertiport operations and then exported these proven models. Crew training progress is on track. We have completed internal structure training for the EH216-S model and submitted all required materials. The plan has been reviewed by the Central and Southern Regional Administration of the CAAC and once formally approved by the CAAC, officer training will begin. After internal instructor training wraps up in late June, we’ll begin full scale crew training. Our non-human-carrying business is an important second growth driver. We focus on two areas: firefighting and inland waterway logistics.

On firefighting side, based on real-world operational scenarios, we have identified a clear product iteration directions. R&D of the new firefighting aircraft is on schedule, and will be formally launched to the market upon product validation, together with supporting maintenance and training systems. In the second half of the year, we’ll showcase product performance through firefighting drills at various levels. while actively working to get our products included fire equipment procurement catalogs, tapping into the emergency response market. On inland waterway logistics side, we have completed site selection for test routes at Guangzhou Port and the Pearl River main channel.

The project will be rolled out in phases near term, continued test flights and routine safety reviews, medium-term routine delivery services on the Pearl River and expansion of our new application scenarios. Long term, replication of the proven model, application for government of funding and building a benchmark inland waterway low-altitude of logistics project in China. On formation drone performances, the industry is seeing increasingly intense low price competition. We are avoiding price competition and have set a clear strategy to build benchmark projects, replicate profitable models and expand both domestically and overseas. In overseas markets, we are simultaneously rolling out formation products, leveraging local tourism resources to create routine performance venues that complement our human-carrying business.

Going forward, I’ll lead the sales, marketing and operations team to execute our strategic plan steadily with the dedication, efficiency and compliance with safety as the first priority. I will now turn the call over to our CFO, Conor Yang. Thank you.

Chia-Hung Yang: Hello, everyone. Before I go into the details, please note that all numbers presented are in RMB unless otherwise stated. A detailed analysis is available in our earnings press release on the IR side. Now let me walk you through the key financial data. In Q1 2026, revenues were RMB 25.7 million, on par with RMB 26.1 million in Q1 2025 but down from RMB 177.6 million in Q4 2025. The decline was mainly due to lower eVTOL deliveries, partly offset by growth from our non-human-carrying business. During the quarter, we delivered four units of the EH216 series compared to 11 units in Q1 2025 and 61 units of EH216 series plus five units of VT35 in Q4 2025.

The lower deliveries were primarily due to seasonal factors at the beginning of the year and the customer delivery schedules. On a positive note, our revenue mix continues to diversify, benefiting from increased brand visibility and growing market demand, our aerial media business grew faster and contributed approximately 40% of the total revenue in Q1, highlighting the synergies across our diversified business lines. Gross margin in Q1 was 62.5%, and stable compared to 62.4% in Q1 2025 and up slightly from 61.6% in Q4 2025. Our consistently strong margin profile reflects continued improvement in manufacturing efficiency and supply chain management. Turning to operating expenses.

Adjusted operating expenses defined as total operating expenses, excluding share-based compensation, were RMB 101.1 million in Q1, up 59% from RMB 63.6 million in Q1 2025 and up 7.9% from RMB 93.7 million in Q4 2025. The increase was driven by our continued commercialization efforts, R&D team expansion and increased technology investment. As our business scales, we have strengthened our operational R&D and global expansion teams while continuing to invest in EH216 series upgrade, VT35 development and future generation of products and core technologies to enrich our product pipeline and reinforce our long-term competitive advantages. As we continue to invest for future growth, our near-term profitability was impacted by lower revenue scale and higher R&D expenditure.

Adjusted operating loss in Q1 was RMB 77.1 million compared to RMB 42.6 million in Q1 2025. Adjusted net loss was RMB 75.6 million compared to RMB 31.1 million in Q1 2025. As of March 31, 2026, our combined cash and cash equivalents restricted to short-term deposits and short-term and treasury investment totaled RMB 1.03 billion. This healthy cash position provides a solid support for the continued execution of our commercialization strategy global expansion plans and technology development programs. While near-term financial performance was impacted by delivery timing and strategic investments, we remain committed to a long-term growth strategy and maintain our 2026 annual revenue guidance of RMB 600 million.

Our confidence is supported by our diversified revenue mix, continued global market of progress, including the commercial breakthrough in Thailand, and the advancement of EH216-S commercial operations in China. Meanwhile, we remain focused on improving our operational efficiency and capital allocation as we scale our business. We believe these efforts will strengthen our foundation for long-term growth and create sustainable value for our shareholders. Based on our confidence in the company’s future inhaled cash position, our Board of Directors has approved a share repurchase program. Over the next 12 months, the company may repurchase up to USD 30 million worth of its ADS.

Repurchases will be funded from existing cash reserves and management will execute them flexibly based on market conditions. This initiative reflects our commitment to returning value to shareholders and demonstrating our long-term confidence. Thank you all.

Operator: [Operator Instructions] Your first question comes from Pei-Chi Wang with MS.

Pei-Chi Wang: I have two questions for the first quarter results. I think first, I think most investors are curious about what is the expected revenue mix for remaining 3 quarters of 2026 because we have been exploring more revenue streams from products outside of eVTOL. So the management can give more color on the revenue mix in the following quarters? So this is my first question. And the second question is about the overseas business. So how should we look at the contribution on the overseas market in the coming months?

Chia-Hung Yang: [Foreign Language]

Unknown Executive: [Interpreted] Hello, Okay. Now I’ll provide a translation for Conor. So the key strategy for the company is to execute revenue diversification strategy and the results have been shown in our Q1 results. And we have our projects both at home and overseas for our human-carrying business as well as our GD4 aerial business. The projects are scattered across both China and overseas. Some of them are — some more the typical examples of projects in [ Changsha ], Xiamen and an overseas example would be Thailand, and we are going to increase the number of performances for the GD4 drone performances in the upcoming 2 quarters.

We are also advancing the R&D for our logistics and firefighting models, and they will be rolled out to the market later this year. In terms of the revenue mix breakdown for our human-carrying business, roughly — specifically speaking, that will be revenue contributed by the sales and deliveries of EH216-S and the VT35. Together, they will contribute 60% of our revenue for non-human-carrying businesses, they are going to contribute roughly 40% of our revenue. And now moving on to the second question. The proportion of the overseas revenue will increase significantly.

We have made obtaining overseas VTCs (i.e., Validation of Type Certificates), , our top priority this year, relying on bilateral agreement channels and have established a dedicated team pioneer projects in Thailand and Mexico are progressing smoothly. In the medium to long term, overseas markets are expected to continuously contribute to revenue. Thank you.

Operator: Your next question comes from Shen Wei with UBS.

Wei Shen: [Foreign Language]

Unknown Executive: [Interpreted] My first question is on the gross profit margin. As you can see, it stayed elevated in Q1. And I also noticed that 40% of the revenue from Q1 was contributed by media business or non-human-carrying related services. I was wondering what’s the gross profit margin for this segment? And what is the market and competition outlook is like for this segment? My second question is on your overseas business. As we have heard from management, the orders — potential orders from overseas markets was around 100 units. I was wondering if there is any update to this number. And if you can, please also provide a time line on that. Thank you.

Unknown Executive: [Foreign Language]

Unknown Executive: [Interpreted] On the gross profit margin, the gross profit margin is — so that specifically means the proper margin of sales and performance of the flight performance of the GD 4.0. That is around 50%. And for our human-caring-business, that’s contributing a higher and higher profit margin this year. Therefore, we are seeing the overall mix staying above 60% for the first quarter. And we also keep that as our full year target. So that’s on the gross profit margin.

Unknown Executive: [Foreign Language]

Unknown Executive: [Interpreted] And with your question on the overseas orders, we are expecting the revenue contribution to rise up to 10% of the overall revenue. However, this specific contribution is closely tied to our commercial development in Thailand. We have been spending every effort in our communication with the CAAC. Our overall target is to launch the official commercial operation by the end of the year. Before the AAM conference is going to be held in Bangkok in the end of this year. If that — if the commercial operation could we achieved earlier. We are going to see a higher contribution to the revenue from the overseas market. Thank you.

Operator: Your next question comes from Alan Lau with Jefferies.

Alan Lau: This is Alan. So I’d like to follow-up on the question regarding to the gross margins. So what are the major cost items for the non-eVTOL business because the margin is 50%. I would like to know what are the key cost of goods sold in that business line? And the second question is, is there any operation data that management is I can share to investors regarding to the operations in Hefei. Thank you.

Unknown Executive: [Foreign Language]

Alan Lau: Sorry, I want to clarify, my first question is regarding to the non-eVTOL part, the aerial media part, like what are the cost of goods sold in that business?

Unknown Executive: [Foreign Language]

Unknown Executive: [Foreign Language]

Unknown Executive: [Interpreted] Now the sales and the performance is a drone slides is contributing 50% profit margin. And to break it down, majority of the costs for the sales, it comes — of the drones is, first of all, the drone costs, plus the battery, the costs used occurred in the assembly line. And when it comes to performing the majority cost of that depends on the size as well as the units of the drones to be deployed for the performance. And given that these drones are possessed by the company as the fixed assets, so there is a cost of depreciation plus the cost of sending personnel and staff to operate and fly these trends at different places.

So together, these form the costs of the operation and sales. And now moving on to the non-human-carrying business, specifically, we’re talking about the firefighting models. It has a higher well, gross margin. In terms of the cost, 1/3 of it comes from the carbon fiber material used in building the model. Another 1/3 of the cost comes from the powertrain as well as the battery with the remaining 1/3 coming from the components that you used to build the model.

Zhao Wang: [Foreign Language]

Unknown Executive: [Interpreted] this is Wang Zhao. I’ll take your second question. I know the market is keen on watching the progress of the operation site in Hefei. I would say it is right now in the final stage of official commercial operations. At the moment, the Hefei and Guangzhou operation sites are currently still in preparation for commercial operations. And given the unique nature of that site being the world’s first pilotless human-carrying eVTOL commercial operation project, the CAAC has proposed a higher and stricter operational standards. And since obtaining the OC in March 2025, we have been maintaining close communications with the CAAC.

We are accumulating precious and valuable trial flight data making sure that there is no accidents or no violations of the standards in place.

Unknown Executive: [Foreign Language]

Unknown Executive: [Interpreted] To supply some key data since obtaining the OC in March 2025, the two partner or two operational sites have maintained stable operations with a safe flag record of 0 accident and 0 violations, completing over 3,000 flights. As we have disclosed at the price, early bird price, we set for the Hefei operation side is RMB 299. Currently, there are four units of EH216-S at this site and they are scheduled to fly 14 flights per day related to mini apps for ticket booking is now up and running. We are fully ready for commercial operations. Once we get to the approval from the CAAC we will soon roll out the commercial operation. Thank you.

Operator: Your next question comes from Laura Li with Deutsche Bank.

Xinran Li: So my first question, could you provide more color on the order intake so far in ’26. And? Are the new orders, mainly from like existing customers or that you’re seeing demand from new clients as well? And my second question will be, could you update the expected time line for the operator training, because once your program is approved, like how long it takes to — like for the first group of the ground crew to complete the training?

Unknown Executive: [Foreign Language]

Unknown Executive: [Foreign Language]

Unknown Executive: [Interpreted] On the revenue question, we remain confident in our full year revenue target of RMB 600 million. Actually, this confidence is based on the diversified revenue structure that achieved in Q1. The predictability of overseas market breakthroughs and domestic commercial operations entering the final sprint phase. Majority of the orders will be coming in, in the second half of the year. We have many orders moving in parallel, given that a majority of the orders coming from government-related or institutions or enterprises, the overall approval for the budget is primarily ready in the second half of the year.

We also have seen a lot of new customers expressing strong interest in purchasing our models, we expect that over 50% of the revenue for this upcoming year is going to come from new customers.

Unknown Executive: [Foreign Language]

Unknown Executive: Sorry. [Foreign Language], sorry.

Unknown Executive: [Foreign Language]

Unknown Executive: [Interpreted] Let me explain, the crew training usually is break down into three stages. In the very first stage, CAAC has officially stipulated the large-scale civil eVTOL pilot training, our crude training mechanism. And we have deeply involved in this process. We actually submitted all the related documents teaching materials and everything. We also participate in making the related teaching materials and formulating the tests required to test all of the training personnel. Actually, in May this year, the CAAC has already published formally published the requirements for the civil eVTOL training related standards. And that actually provided a key compliant reference for the whole industry.

And we actually — EHang, has been deeply involved in that process, and we have actually lend our experience to this process, informing the standards.

Unknown Executive: [Foreign Language]

Unknown Executive: [Interpreted] And following the formulating these standards is the internal training of the instructors. This process has kicked off and it’s about to wrap up. We have submitted associated plans, which has been reviewed by the CAAC. Right now, this has been progressing quite steadily. We’re expecting the training of the instructor program to wrap up by the end of the month. And the third stage is to kick off the official training of the crew, ground crew and that will expected to start in the following quarters.

Once all these stages have completed, EHang we’ll be in a good position and ready to launch batch trainings with each training group, we can train 5 to 10 personnel and with multiple classes training groups moving in parallel. By that, time, we will be ready to supply a sufficient number of the qualified ground crew to the market.

Operator: Thank you all. Given the time is limited, let me turn the call back to Ms. Anne for closing remarks.

Anne Ji: Okay. Thank you, operator, and thank you all for participating in today’s call. We understood that there are many analysts and the investors still waiting on the line. But due to the time limit, if you have any further questions, please contact our IR team by e-mail or participating in our following investors through the calendar information provided on our IR site. And we appreciate your interest and look forward to our next earnings call. Thank you.

Operator: That does conclude our conference for today. Thank you for participating. You may now disconnect. [Portions of this transcript that are marked [Interpreted] were spoken by an interpreter present on the live call.]