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UXIN
Earnings call · Jun 2026 (Q2 FY26)

Uxin Q2 FY26 earnings call UXIN

Sep 24, 2026 Source

Executive summary

Uxin Q2 FY26 — Strong Volume Growth Amidst Market Consolidation, Gross Margin Recovery Expected

Uxin demonstrated robust retail transaction volume growth and improved inventory efficiency in Q2 FY26, significantly outpacing a consolidating Chinese automotive market. While gross margin was temporarily impacted by rapid new car price declines, management anticipates a strong recovery in Q3, driven by proactive inventory adjustments and enhanced digital pricing capabilities. The company maintains a prudent operating approach amidst continued market volatility, focusing on capital efficiency and per-unit profitability.

Highlights

4

  • Retail transaction volume increased by 89% year-over-year to 19,610 units, significantly outperforming the broader market.

  • Inventory turnover shortened from approximately 30 days to approximately 20 days, improving operating efficiency and reducing price risk.

  • Gross margin is expected to recover to above 6% in Q3 FY26 after a temporary negative 0.7% in Q2 FY26.

  • Total revenue grew 75% year-over-year to RMB 1.51 billion.

Concerns

4

  • Gross margin was negative 0.7% in Q2 FY26, down from 7% in the prior quarter, due to rapid new car price declines impacting existing inventory.

  • Adjusted EBITDA loss was RMB 120 million, primarily reflecting the temporary impact of the lower gross margin.

  • New passenger vehicle sales in China declined by more than 20% year-over-year in Q2 FY26, with ICE car sales down nearly 40%.

  • Nationwide used car transactions declined by 1.4% year-over-year in Q2 FY26, and further in July (-6%) and August (-11%).

Guidance & targets

CategoryTargetConfidence
Retail transaction volume
between 20,500 and 21,000 units
high materiality
High
Total revenue
between RMB 1.16 billion and RMB 1.19 billion
high materiality
High
Overall gross margin
above 6%
high materiality
High

UXIN operating KPIs by quarter

UXIN operating KPIs stated on its earnings calls, by fiscal quarter
KPI Mar 2026 Q1 FY26This call Jun 2026 Q2 FY26Change vs prior quarter
Retail transaction volume
16.53K In the first quarter of 2026, our business continued its strong growth momentum despite the seasonal impact of the Chinese New Year holiday on used car sales, retail transaction volume reached 16,530 units, representing a 119% year-over-year increase. Source transcript
19.61K Our retail transaction volume reached 19,610 units, up 89% year-over-year and 19% sequentially. Source transcript
+18.6%
Average selling price Retail
61K CNY The average selling price or ASP of retail vehicles was RMB 61,000 compared with RMB 59,000 in the previous quarter and RMB 62,000 in the same period last year, remaining generally stable. Source transcript
55K CNY The average selling price or ASP of our retail vehicles was RMB 55,000 compared with RMB 59,000 in the same period last year and RMB 61,000 last quarter. Source transcript
-9.8%
Wholesale transaction volume
1,681 Our wholesale transaction volume was 1,681 units in the first quarter, representing a 134% year-over-year increase and a 32% decline sequentially. Source transcript
2,289 Our wholesale transaction volume was 2,289 units in the second quarter, up 88% year-over-year and 36% sequentially. Source transcript
+36.2%

Operating figures the company states on every call, checked against each call's transcript. Click a figure to read the sentence. A dash means it was not stated that quarter.

Deals & partnerships

Neo Capital Strategic investment in Uxin $8 million total

Uxin recently received $4 million in investment proceeds from Neo Capital. The closing of the remaining $4 million investment is proceeding as planned, with Neo Capital confirming it will proceed at $2.86 per ADS. NIO Capital is also actively advancing the overseas direct investment (ODI) filing process for its investment.

Risks & headwinds

Rapid decline in new car prices, particularly for ICE cars Q2 FY26, continued into Q3 FY26

New passenger vehicle sales declined by more than 20% year-over-year, ICE car sales down nearly 40% in Q2 FY26.

Mitigation:Proactively accelerated inventory adjustments and sell-through; shortened inventory turnover to ~20 days; prudent inventory procurement strategy.

Overall auto consumption remains relatively weak, impacting used car transactions Q2 FY26 and Q3 FY26 to date

Nationwide used car transactions declined by 1.4% year-over-year in Q2 FY26, 6% in July, and 11% in August.

Mitigation:Maintaining rapid inventory turnover and driving sales growth through faster turnover and greater capital efficiency to reduce the impact of price fluctuation.

Significant number of brick-and-mortar used car dealerships exiting the market FY26

Nearly 30,000 dealerships exited in H1 FY26; expected 50,000 to 60,000 for the full year (more than 20% of the industry).

Mitigation:Leveraging scale, standardized operations, and digital capabilities to gain market share; expanding superstore footprint and warehouse network.

What to watch in Q3 FY26

Overall gross margin

Q3 FY26
Current negative 0.7% (Q2 FY26)
Target above 6%

Why it matters

Indicates the effectiveness of inventory adjustments and pricing strategies in restoring profitability after Q2 volatility.

Since the beginning of the third quarter, our per unit profitability has recovered rapidly, and we expect our overall gross margin to recover to above 6%.

Q&A highlights

How did Uxin achieve 20-day inventory turnover, and is it a temporary response or a long-term goal?

The 20-day turnover is due to AI application in pricing and integrated operating systems. It's a long-term core operating target, not a short-term defensive strategy, as it reduces price risk and improves capital efficiency without sacrificing per-unit profitability.

“So for us, inventory turnover of around 20 days is not a short-term defensive strategy. It is a core operating target that we intend to maintain over the long term.”

asked by Unknown Analyst · answered by Feng Lin

2 min read 5 chapters

Detailed narrative

China Automotive Market Dynamics

The Chinese automotive market is undergoing accelerated consolidation, with new passenger vehicle sales declining over 20% year-over-year in Q2 FY26, and ICE car sales down nearly 40%. This pressure has flowed into the used car market, which saw transactions decline by 1.4% year-over-year in Q2. The rapid decline in new car prices, particularly for ICE vehicles, has significantly impacted used car values and driven industry consolidation, with an estimated 50,000 to 60,000 dealerships expected to exit in FY26.

Uxin's Outperformance and Strategic Response

Despite challenging market conditions, Uxin significantly outperformed, achieving 89% year-over-year growth in retail transaction volume to 19,610 units in Q2 FY26. The company proactively accelerated inventory adjustments to manage price volatility, which temporarily impacted gross margin to negative 0.7%. However, Uxin expects a rapid recovery to above 6% gross margin in Q3 FY26, driven by enhanced digital pricing systems and improved operating efficiency.

Inventory Management and Operating Efficiency

Uxin has successfully shortened its inventory turnover from approximately 30 days to around 20 days, a core operating target intended for the long term. This improvement is attributed to the application of AI in pricing and risk management, as well as the integration of end-to-end operating systems across inspection, reconditioning, inventory management, and CRM. Faster turnover significantly reduces price risk and enhances capital efficiency, allowing for greater operating leverage.

Superstore Expansion and Digitalization

Uxin continues to strengthen its superstore model, with sales volumes and operating efficiency ramping up at existing locations. Six new superstores are currently under development in cities including Guangzhou and Chongqing. The company is also steadily advancing discussions for new partnerships to expand its warehouse network nationwide, leveraging digitalization to standardize operations and gain market share in a consolidating industry.

CEO Share Purchase and Investor Confidence

CEO Dai Kun announced a plan to purchase up to $5 million of the company's ADS at a price of more than $2.85 per ADS, with purchases eligible to begin on September 28. This move is intended as a tangible demonstration of confidence in the company's long-term value and to align personal interests with those of shareholders, reflecting the CEO's belief in Uxin's strategic direction and improving core capabilities.

AI-generated summary of the company's earnings call. Not investment advice.