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Smart Share Global Ltd

Smart Share Global LtdEMEarnings & Financial Report

Nasdaq · computing

Smart Technologies is a Canadian company headquartered in Calgary, Alberta, Canada and wholly owned by Foxconn. Founded in 1987, SMART is best known as the developer of interactive whiteboards branded as the "Smart Board" widely used in education and business.

What changed in Smart Share Global Ltd's 20-F — 2023 vs 2024

Top changes in Smart Share Global Ltd's 2024 20-F

552 paragraphs added · 502 removed · 427 edited across 5 sections

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

202 edited+57 added−36 removed730 unchanged
To the extent cash in the business is in the PRC or a PRC entity, the funds may not be available to fund operations or for other use outside of the PRC due to interventions in or the imposition of restrictions and limitations on the ability of Smart Share Global Limited, its subsidiaries or the VIE by the PRC government to transfer cash.
To the extent cash in the business is in the PRC or a PRC entity, the funds may not be available to fund operations or for other use outside of the PRC due to interventions in or the imposition of restrictions and limitations on the ability of Smart Share Global Limited, its subsidiaries or the VIE by the PRC government to transfer cash.
Risk Factors—Risks Relating to Doing Business in China—Our ADSs may be prohibited from trading in the United States under the HFCAA in the future if the PCAOB is unable to inspect or investigate completely auditors located in China.
Risk Factors—Risks Relating to Doing Business in China—Our ADSs may be prohibited from trading in the United States under the HFCAA in the future if the PCAOB is unable to inspect or investigate completely auditors located in China.
In addition, there is no assurance the PRC government will not intervene in or impose restrictions on the ability of Smart Share Global Limited, its subsidiaries, and the VIE to transfer cash.
In addition, there is no assurance the PRC government will not intervene in or impose restrictions on the ability of Smart Share Global Limited, its subsidiaries, and the VIE to transfer cash.
To the extent cash in the business is in the PRC or a PRC entity, the funds may not be available to fund operations or for other use outside of the PRC due to interventions in or the imposition of restrictions and limitations on the ability of Smart Share Global Limited, its subsidiaries, or the VIE by the PRC government to transfer cash.
To the extent cash in the business is in the PRC or a PRC entity, the funds may not be available to fund operations or for other use outside of the PRC due to interventions in or the imposition of restrictions and limitations on the ability of Smart Share Global Limited, its subsidiaries, or the VIE by the PRC government to transfer cash.
On December 15, 2022, the PCAOB issued a report that vacated its December 16, 2021 determination and removed mainland China and Hong Kong from the list of jurisdictions where it is unable to inspect or investigate completely registered public accounting firms.
On December 15, 2022, the PCAOB issued a report that vacated its December 16, 2021 determination and removed mainland China and Hong Kong from the list of jurisdictions where it is unable to inspect or investigate completely registered public accounting firms.
In May 2022, the SEC conclusively listed our company as a Commission-Identified Issuer under the HFCAA following the filing of our annual report on Form 20-F for the fiscal year ended December 31, 2021.
In May 2022, the SEC conclusively listed our company as a Commission-Identified Issuer under the HFCAA following the filing of our annual report on Form 20-F for the fiscal year ended December 31, 2021.
Each year, the PCAOB will determine whether it can inspect and investigate completely audit firms in mainland China and Hong Kong, among other jurisdictions.
Each year, the PCAOB will determine whether it can inspect and investigate completely audit firms in mainland China and Hong Kong, among other jurisdictions.
Pursuant to the Announcement relating to the Notice on Filing Management Arrangements for Overseas Securities Offering and Listing by Domestic Companies issued on February 17, 2023 by the CSRC, domestic companies that had been listed overseas prior to March 31, 2023 are categorized as “existing enterprises” and are not required to file with the CSRC with respect to their previous listings immediately.
Pursuant to the Announcement relating to the Notice on Filing Management Arrangements for Overseas Securities Offering and Listing by Domestic Companies issued on February 17, 2023 by the CSRC, domestic companies that had been listed overseas prior to March 31, 2023 are categorized as “existing enterprises” and are not required to file with the CSRC with respect to their previous listings immediately.
These provisions could have the effect of depriving our shareholders of the opportunity to sell their shares at a premium over the prevailing market price by discouraging third parties from seeking to obtain control of our company in a tender offer or similar transactions. 64 Table of Contents Our memorandum and articles of association and the deposit agreement provide that the United States District Court for the Southern District of New York (or, if the United States District Court for the Southern District of New York lacks subject matter jurisdiction over a particular dispute, the state courts in New York County, New York) is the exclusive judicial forum within the U.S. for the resolution of any complaint asserting a cause of action arising out of or relating in any way to the federal securities laws of the United States, and any suit, action or proceeding arising out of or relating in any way to the ADSs or the deposit agreement, which could limit the ability of holders of our ordinary shares, the ADSs or other securities to obtain a favorable judicial forum for disputes with us, our directors and officers, the depositary and potentially others.
These provisions could have the effect of depriving our shareholders of the opportunity to sell their shares at a premium over the prevailing market price by discouraging third parties from seeking to obtain control of our company in a tender offer or similar transactions. 67 Table of Contents Our memorandum and articles of association and the deposit agreement provide that the United States District Court for the Southern District of New York (or, if the United States District Court for the Southern District of New York lacks subject matter jurisdiction over a particular dispute, the state courts in New York County, New York) is the exclusive judicial forum within the U.S. for the resolution of any complaint asserting a cause of action arising out of or relating in any way to the federal securities laws of the United States, and any suit, action or proceeding arising out of or relating in any way to the ADSs or the deposit agreement, which could limit the ability of holders of our ordinary shares, the ADSs or other securities to obtain a favorable judicial forum for disputes with us, our directors and officers, the depositary and potentially others.
Because we qualify as a foreign private issuer under the Exchange Act, we are exempt from certain provisions of the securities rules and regulations in the United States that are applicable to U.S. domestic issuers, including: ● the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q or current reports on Form 8-K; ● the sections of the Exchange Act regulating the solicitation of proxies, consents, or authorizations in respect of a security registered under the Exchange Act; ● the sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and liability for insiders who profit from trades made in a short period of time; ● the selective disclosure rules by issuers of material nonpublic information under Regulation FD; and ● certain audit committee independence requirements in Rule 10A-3 of the Exchange Act. 67 Table of Contents We are required to file an annual report on Form 20-F within four months of the end of each fiscal year.
Because we qualify as a foreign private issuer under the Exchange Act, we are exempt from certain provisions of the securities rules and regulations in the United States that are applicable to U.S. domestic issuers, including: ● the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q or current reports on Form 8-K; ● the sections of the Exchange Act regulating the solicitation of proxies, consents, or authorizations in respect of a security registered under the Exchange Act; ● the sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and liability for insiders who profit from trades made in a short period of time; ● the selective disclosure rules by issuers of material nonpublic information under Regulation FD; and ● certain audit committee independence requirements in Rule 10A-3 of the Exchange Act. 70 Table of Contents We are required to file an annual report on Form 20-F within four months of the end of each fiscal year.
Programming errors or design defects within the software or human errors in connection with the operation of the software may result in miscalculation of revenues, negative experience to users, disruptions and deoptimization of the operation of our power bank cabinets, unintended leakage of confidential information of users, network partners, locations partners or other business partners, compromise in our ability to provide effective customer service and exploitation of loopholes by malicious hackers.
Programming errors or design defects within the software or human errors in connection with the operation of the software may result in miscalculation of revenues and expenses, negative experience to users, disruptions and deoptimization of the operation of our power bank cabinets, unintended leakage of confidential information of users, network partners, locations partners or other business partners, compromise in our ability to provide effective customer service and exploitation of loopholes by malicious hackers.
Lastly, we have explored and plan to continue to explore new business initiatives by expanding to new product categories or industries in China. For instance, we entered into the renewable energy sector by launching our services as an engineering, procurement and construction (EPC) contractor in distributed photovoltaic projects in 2023.
Lastly, we have explored and plan to continue to explore new business initiatives by expanding to new product categories or industries in China. For instance, we entered into the renewable energy sector by launching our services as an engineering, procurement and construction (EPC) contractor in distributed photovoltaic projects starting in 2023.
Risk Factors—Risks Relating to Doing Business in China—PRC regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent us from using the proceeds of our securities offering to make loans or additional capital contributions to our PRC subsidiaries and the VIE, which could materially and adversely affect our liquidity and our ability to fund and expand our business.” A. [Reserved] The following selected consolidated statements of operations data for the years ended December 31, 2021, 2022 and 2023, selected consolidated balance sheet data as of December 31, 2022 and 2023, and selected consolidated statements of cash flow data for the years ended December 31, 2021, 2022 and 2023 have been derived from our audited consolidated financial statements included elsewhere in this annual report.
Risk Factors—Risks Relating to Doing Business in China—PRC regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent us from using the proceeds of our securities offering to make loans or additional capital contributions to our PRC subsidiaries and the VIE, which could materially and adversely affect our liquidity and our ability to fund and expand our business.” A. [Reserved] The following selected consolidated statements of operations data for the years ended December 31, 2022, 2023 and 2024, selected consolidated balance sheet data as of December 31, 2023 and 2024, and selected consolidated statements of cash flow data for the years ended December 31, 2022, 2023 and 2024 have been derived from our audited consolidated financial statements included elsewhere in this annual report.
In addition, we have been subject to stricter regulatory requirements in terms of entering into labor contracts with our employees and paying various statutory employee benefits, including pensions, housing fund, medical insurance, work-related injury insurance, unemployment insurance and maternity insurance to designated government agencies for the benefit of our employees.
We have been subject to stricter regulatory requirements in terms of entering into labor contracts with our employees and paying various statutory employee benefits, including pensions, housing fund, medical insurance, work-related injury insurance, unemployment insurance and maternity insurance to designated government agencies for the benefit of our employees.
We have been and may in the future be involved in intellectual property lawsuits alleging that certain components of our power banks or cabinets contain designs or other elements that infringe upon another party’s patents or other intellectual property rights. We have taken measures to avoid infringing on other parties’ patents or other intellectual property rights.
We had been and may in the future be involved in intellectual property lawsuits alleging that certain components of our power banks or cabinets contain designs or other elements that infringe upon another party’s patents or other intellectual property rights. We have taken measures to avoid infringing on other parties’ patents or other intellectual property rights.
For this reason, we were not identified as a Commission-Identified Issuer under the HFCAA after we filed our annual report on Form 20-F for the fiscal year ended December 31, 2022 and do not expect to be so identified after we file this annual report on Form 20-F for the fiscal year ended December 31, 2023.
For this reason, we were not identified as a Commission-Identified Issuer under the HFCAA after we filed our annual report on Form 20-F for the fiscal year ended December 31, 2022 or 2023 and do not expect to be so identified after we file this annual report on Form 20-F.
For this reason, we were not identified as a Commission-Identified Issuer under the HFCAA after we filed our annual report on Form 20-F the fiscal year ended December 31, 2022 and do not expect to be so identified after we file this annual report on Form 20-F for the fiscal year ended December 31, 2023.
For this reason, we were not identified as a Commission-Identified Issuer under the HFCAA after we filed our annual report on Form 20-F the fiscal year ended December 31, 2022 or 2023 and do not expect to be so identified after we file this annual report on Form 20-F.
Business involving online payment services is subject to a number of risks that could materially and adversely affect third-party online payment service providers’ ability to provide payment processing and escrow services to us, including: ● dissatisfaction with these online payment services or decreased use of their services by paying users and location partners; ● increasing competition, including from other established Chinese internet companies, payment service providers and companies engaged in other financial technology services; ● changes to rules or practices applicable to payment systems that link to third-party online payment service providers; ● breach of paying users’ personal information and concerns over the use and security of information collected from paying users; ● service outages, system failures or failures to effectively scale the system to handle large and growing transaction volumes; ● increasing costs to third-party online payment service providers, including fees charged by banks to process transactions through online payment channels, which would also increase our costs of revenues; and ● failure to manage funds accurately or loss of funds, whether due to employee fraud, security breaches, technical errors or otherwise.
Business involving online payment services is subject to a number of risks that could materially and adversely affect third-party online payment service providers’ ability to provide payment processing and escrow services to us, including: ● dissatisfaction with these online payment services or decreased use of their services by paying users and location partners; 45 Table of Contents ● increasing competition, including from other established Chinese internet companies, payment service providers and companies engaged in other financial technology services; ● changes to rules or practices applicable to payment systems that link to third-party online payment service providers; ● breach of paying users’ personal information and concerns over the use and security of information collected from paying users; ● service outages, system failures or failures to effectively scale the system to handle large and growing transaction volumes; ● increasing costs to third-party online payment service providers, including fees charged by banks to process transactions through online payment channels, which would also increase our costs of revenues; and ● failure to manage funds accurately or loss of funds, whether due to employee fraud, security breaches, technical errors or otherwise.
We may be required to make further adjustments to our business practices to comply with the personal information protection laws and regulations. 32 Table of Contents ● In June 2022, the CAC amended the Administrative Provisions on Information Services of Mobile Internet Application Programs, which came into effect on August 1, 2022, which further emphasize that mobile internet app providers shall not compel users to agree to processing of their personal information out of any reason, and are prohibited from banning users from their basic functional services due to the users’ refusal of providing non-essential personal information.
We may be required to make further adjustments to our business practices to comply with the personal information protection laws and regulations. 34 Table of Contents ● In June 2022, the CAC amended the Administrative Provisions on Information Services of Mobile Internet Application Programs, which came into effect on August 1, 2022, which further emphasize that mobile internet app providers shall not compel users to agree to processing of their personal information out of any reason, and are prohibited from banning users from their basic functional services due to the users’ refusal of providing non-essential personal information.
Generally speaking, if we fail to achieve and maintain an effective internal control environment, we could suffer material misstatements in our financial statements and fail to meet our reporting obligations, which would likely cause investors to lose confidence in our reported financial information.
Generally speaking, if we fail to achieve and maintain an effective internal control environment, we could suffer more material misstatements in our financial statements and fail to meet our reporting obligations, which would likely cause investors to lose confidence in our reported financial information.
If we do not adapt to or comply with the evolving expectations and standards on ESG matters from investors and the PRC government or are perceived to have not responded appropriately to the growing concern for ESG issues, regardless of whether there is a legal requirement to do so, we may suffer from reputational damage and the business, financial condition, and the price of our ADSs could be materially and adversely effected. 38 Table of Contents Our success depends on the continuing and collaborative efforts of our management team and other key personnel.
If we do not adapt to or comply with the evolving expectations and standards on ESG matters from investors and the PRC government or are perceived to have not responded appropriately to the growing concern for ESG issues, regardless of whether there is a legal requirement to do so, we may suffer from reputational damage and the business, financial condition, and the price of our ADSs could be materially and adversely effected. 39 Table of Contents Our success depends on the continuing and collaborative efforts of our management team and other key personnel.
Such substantial capital expenditure to be incurred in catching up with new technology trends may materially and adversely affect our business and financial performance. 27 Table of Contents Our capability to roll out new or enhanced products and services in turn depend on a number of factors, including timely and successful research and development efforts by us as well as our suppliers and assembly partners to bring advanced technologies to the market, as well as quality control of service provision and product manufacturing.
Such substantial capital expenditure to be incurred in catching up with new technology trends may materially and adversely affect our business and financial performance. 29 Table of Contents Our capability to roll out new or enhanced products and services in turn depend on a number of factors, including timely and successful research and development efforts by us as well as our suppliers and assembly partners to bring advanced technologies to the market, as well as quality control of service provision and product manufacturing.
If the PCAOB determines in the future that it no longer has full access to inspect and investigate completely accounting firms in mainland China and Hong Kong and we use an accounting firm headquartered in one of these jurisdictions to issue an audit report on our financial statements filed with the Securities and Exchange Commission, or the SEC, we would be identified as a Commission-Identified Issuer following the filing of the annual report on Form 20-F for the relevant fiscal year.
If the PCAOB determines in the future that it no longer has full access to inspect and investigate completely accounting firms in mainland China and Hong Kong and we use an accounting firm headquartered in one of those jurisdictions to issue an audit report on our financial statements filed with the Securities and Exchange Commission, or the SEC, we would be identified as a Commission-Identified Issuer following the filing of the annual report on Form 20-F for the relevant fiscal year.
Risks Relating to Doing Business in China Changes in China’s economic, political or social conditions or government policies could have a material and adverse effect on our business and results of operations. All of our operations are located in China.
Risks Relating to Doing Business in China Changes in China’s economic, political or social conditions or government policies could have a material and adverse effect on our business and results of operations. Substantially all of our operations are located in China.
If government authorities in jurisdictions where we operate require additional licenses or permits or provides more strict supervision requirements in the future, or if we have to obtain the licenses or permits in a short period of time, there is no guarantee that we would be able to obtain such licenses or permits or meet all the supervision requirements in a timely manner, or at all. 40 Table of Contents The success of our business operation depends upon the performance and reliability of internet, mobile, and other infrastructures that are not under our control.
If government authorities in jurisdictions where we operate require additional licenses or permits or provides more strict supervision requirements in the future, or if we have to obtain the licenses or permits in a short period of time, there is no guarantee that we would be able to obtain such licenses or permits or meet all the supervision requirements in a timely manner, or at all. 41 Table of Contents The success of our business operation depends upon the performance and reliability of internet, mobile, and other infrastructures that are not under our control.
This may make it more difficult for you to obtain the information needed to establish any facts necessary for a shareholder motion or to solicit proxies from other shareholders in connection with a proxy contest. 65 Table of Contents As a result of all of the above, our public shareholders may have more difficulty in protecting their interests in the face of actions taken by management, members of our board of directors or controlling shareholders than they would as public shareholders of a company incorporated in the United States.
This may make it more difficult for you to obtain the information needed to establish any facts necessary for a shareholder motion or to solicit proxies from other shareholders in connection with a proxy contest. 68 Table of Contents As a result of all of the above, our public shareholders may have more difficulty in protecting their interests in the face of actions taken by management, members of our board of directors or controlling shareholders than they would as public shareholders of a company incorporated in the United States.
If we do not continue to maintain and strengthen our brand image and grow the value of our brand, we may lose the opportunity to build a critical mass of users, and our business and operating results may be adversely affected. 29 Table of Contents Negative publicity about us and our business, shareholders, affiliates, directors, officers, other employees, business partners, users and businesses with similar names to ours without our authorization, as well as the industry in which we operate, can harm our brand and reputation.
If we do not continue to maintain and strengthen our brand image and grow the value of our brand, we may lose the opportunity to build a critical mass of users, and our business and operating results may be adversely affected. 31 Table of Contents Negative publicity about us and our business, shareholders, affiliates, directors, officers, other employees, business partners, users and businesses with similar names to ours without our authorization, as well as the industry in which we operate, can harm our brand and reputation.
Assuming that we are the owner of the VIE for U.S. federal income tax purposes, and based on the nature and composition of our assets (in particular, the retention of substantial amounts of cash and investments), and the market price of our ADSs and ordinary shares, we believe that we were a PFIC for the taxable year ended December 31, 2023, and we will likely be a PFIC for the current taxable year unless the market price of our ADSs increases and/or we invest a substantial amount of the cash and other passive assets we hold in assets that produce or are held for the production of income.
Assuming that we are the owner of the VIE for U.S. federal income tax purposes, and based on the nature and composition of our assets (in particular, the retention of substantial amounts of cash and investments), and the market price of our ADSs and ordinary shares, we believe that we were a PFIC for the taxable year ended December 31, 2024, and we will likely be a PFIC for the current taxable year unless the market price of our ADSs increases and/or we invest a substantial amount of the cash and other passive assets we hold in assets that produce or are held for the production of income.
As a result, our shareholders may be afforded less protection than they would otherwise enjoy under the Nasdaq Stock Market’s corporate governance listing standards applicable to U.S. domestic issuers. 68 Table of Contents The voting rights of holders of ADSs are limited by the terms of the deposit agreement, and you may not be able to exercise your right to direct how the Class A ordinary shares which are represented by your ADSs are voted.
As a result, our shareholders may be afforded less protection than they would otherwise enjoy under the Nasdaq Stock Market’s corporate governance listing standards applicable to U.S. domestic issuers. 71 Table of Contents The voting rights of holders of ADSs are limited by the terms of the deposit agreement, and you may not be able to exercise your right to direct how the Class A ordinary shares which are represented by your ADSs are voted.
No assurance can be given that our acquisitions, joint ventures and other strategic investments will be successful and will not materially and adversely affect our business, financial condition or results of operations. 39 Table of Contents We may become a target for public scrutiny, including complaints to regulatory agencies, negative media coverage, and public dissemination of malicious reports or accusations about our business, all of which could severely damage our reputation and materially and adversely affect our business and prospects.
No assurance can be given that our acquisitions, joint ventures and other strategic investments will be successful and will not materially and adversely affect our business, financial condition or results of operations. 40 Table of Contents We may become a target for public scrutiny, including complaints to regulatory agencies, negative media coverage, and public dissemination of malicious reports or accusations about our business, all of which could severely damage our reputation and materially and adversely affect our business and prospects.
If these or other disputes between the shareholders of the VIE and third parties were to impair our control over the VIE, our ability to consolidate the financial results of the VIE would be affected, which would in turn result in a material adverse effect on our business, operations and financial condition. 47 Table of Contents All the agreements under our contractual arrangements are governed by PRC law and provide for the resolution of disputes through arbitration in China.
If these or other disputes between the shareholders of the VIE and third parties were to impair our control over the VIE, our ability to consolidate the financial results of the VIE would be affected, which would in turn result in a material adverse effect on our business, operations and financial condition. 49 Table of Contents All the agreements under our contractual arrangements are governed by PRC law and provide for the resolution of disputes through arbitration in China.
We cannot assure you that our determination regarding our qualification to enjoy the preferential tax treatment will not be challenged by the tax authority or we will be able to complete the necessary filings with the tax authority and enjoy the preferential withholding tax rate of 5% under the arrangement with respect to dividends to be paid by our PRC subsidiaries to our Hong Kong subsidiaries. 59 Table of Contents We face uncertainty with respect to indirect transfers of equity interests in PRC resident enterprises by their non-PRC holding companies.
We cannot assure you that our determination regarding our qualification to enjoy the preferential tax treatment will not be challenged by the tax authority or we will be able to complete the necessary filings with the tax authority and enjoy the preferential withholding tax rate of 5% under the arrangement with respect to dividends to be paid by our PRC subsidiaries to our Hong Kong subsidiaries. 61 Table of Contents We face uncertainty with respect to indirect transfers of equity interests in PRC resident enterprises by their non-PRC holding companies.
In addition, the affected entity may not be able to recover corporate assets that are sold or transferred out of our control in the event of such a misappropriation if a transferee relies on the apparent authority of the representative and acts in good faith. 60 Table of Contents Risks Relating to Our ADSs The trading price of the ADSs is likely to be volatile, which could result in substantial losses to investors.
In addition, the affected entity may not be able to recover corporate assets that are sold or transferred out of our control in the event of such a misappropriation if a transferee relies on the apparent authority of the representative and acts in good faith. 62 Table of Contents Risks Relating to Our ADSs The trading price of the ADSs is likely to be volatile, which could result in substantial losses to investors.
If we fail to fully comply with applicable privacy, data security and personal information protection laws, regulations, policies or other requirements, we may be subject to civil or administrative liabilities or challenged for a potential infringement which may subject us to significant legal, financial and operational consequences. 37 Table of Contents We have adopted security policies and measures, including encryption technology, to protect our proprietary data and consumer information.
If we fail to fully comply with applicable privacy, data security and personal information protection laws, regulations, policies or other requirements, we may be subject to civil or administrative liabilities or challenged for a potential infringement which may subject us to significant legal, financial and operational consequences. 38 Table of Contents We have adopted security policies and measures, including encryption technology, to protect our proprietary data and consumer information.
If the ADS facility will terminate, ADS holders will receive at least 90 days’ prior notice, but no prior consent is required from them. 69 Table of Contents ADS holders may not be entitled to a jury trial with respect to claims arising under the deposit agreement, which could result in less favorable outcomes to the plaintiff(s) in any such action.
If the ADS facility will terminate, ADS holders will receive at least 90 days’ prior notice, but no prior consent is required from them. 72 Table of Contents ADS holders may not be entitled to a jury trial with respect to claims arising under the deposit agreement, which could result in less favorable outcomes to the plaintiff(s) in any such action.
If our employees fail to pay or we fail to withhold their income taxes according to laws and regulations, we may face sanctions imposed by the tax authorities or other PRC government authorities. 58 Table of Contents If we are classified as a PRC resident enterprise for PRC income tax purposes, such classification could result in unfavorable tax consequences to us and our non-PRC shareholders or ADS holders.
If our employees fail to pay or we fail to withhold their income taxes according to laws and regulations, we may face sanctions imposed by the tax authorities or other PRC government authorities. 60 Table of Contents If we are classified as a PRC resident enterprise for PRC income tax purposes, such classification could result in unfavorable tax consequences to us and our non-PRC shareholders or ADS holders.
In addition, there may be industry-wide conditions, health crises, natural disasters and global events in the future that may cause material shortages for components. 28 Table of Contents In the event of a component shortage or supply interruption from suppliers of key components, we will need to identify alternate sources of supply, which can be time-consuming, difficult and costly.
In addition, there may be industry-wide conditions, health crises, natural disasters and global events in the future that may cause material shortages for components. 30 Table of Contents In the event of a component shortage or supply interruption from suppliers of key components, we will need to identify alternate sources of supply, which can be time-consuming, difficult and costly.
As a result, our business operations and our ability to distribute profits to you could be materially and adversely affected. 57 Table of Contents China’s M&A Rules and certain other PRC regulations establish complex procedures for certain acquisitions of PRC companies by foreign investors, which could make it more difficult for us to pursue growth through acquisitions in China.
As a result, our business operations and our ability to distribute profits to you could be materially and adversely affected. 59 Table of Contents China’s M&A Rules and certain other PRC regulations establish complex procedures for certain acquisitions of PRC companies by foreign investors, which could make it more difficult for us to pursue growth through acquisitions in China.
Volatility or a lack of positive performance in our ADS price may also adversely affect our ability to retain key employees, most of whom have been granted equity incentives. 61 Table of Contents In the past, shareholders of public companies have often brought securities class action suits against those companies following periods of instability in the market price of their securities.
Volatility or a lack of positive performance in our ADS price may also adversely affect our ability to retain key employees, most of whom have been granted equity incentives. 63 Table of Contents In the past, shareholders of public companies have often brought securities class action suits against those companies following periods of instability in the market price of their securities.
In addition, we may face other market regulations imposed by government regulations in the future, which could adversely affect our reputation, business and results of operations. 26 Table of Contents If we are unable to anticipate and accommodate consumer preferences in a timely manner or otherwise fail to deliver a satisfactory consumer experience, our business may be materially and adversely affected.
In addition, we may face other market regulations imposed by government regulations in the future, which could adversely affect our reputation, business and results of operations. 28 Table of Contents If we are unable to anticipate and accommodate consumer preferences in a timely manner or otherwise fail to deliver a satisfactory consumer experience, our business may be materially and adversely affected.
A number of factors beyond our control may affect the level of consumer demand and discretionary spending on the products that we offer, including, among other things: ● general economic and industry conditions; ● disposable income of consumers; 35 Table of Contents ● discounts and promotions offered by our competitors; ● negative reports and publicity about the mobile device charging service industry; ● outbreak of viruses or widespread illness; ● unemployment levels; ● minimum wages and personal debt levels of consumers; ● consumer confidence in future economic conditions; ● fluctuations in the financial markets; and ● natural disasters, war, terrorism and other hostilities.
A number of factors beyond our control may affect the level of consumer demand and discretionary spending on the products that we offer, including, among other things: ● general economic and industry conditions; ● disposable income of consumers; ● discounts and promotions offered by our competitors; ● negative reports and publicity about the mobile device charging service industry; ● unemployment levels; ● minimum wages and personal debt levels of consumers; ● consumer confidence in future economic conditions; ● fluctuations in the financial markets; ● outbreak of viruses or widespread illness; and ● natural disasters, war, terrorism and other hostilities.
Business Overview—Regulation—Regulations Relating to Internet Information Security and Privacy Protection.” Set forth below are examples of certain recent PRC regulatory activities in this area: 31 Table of Contents Data Security ● In June 2021, the Standing Committee of the National People’s Conference promulgated the Data Security Law, which took effect in September 2021.
Business Overview—Regulation—Regulations Relating to Internet Information Security and Privacy Protection.” Set forth below are examples of certain recent PRC regulatory activities in this area: 33 Table of Contents Data Security ● In June 2021, the Standing Committee of the National People’s Conference promulgated the Data Security Law, which took effect in September 2021.
Such restrictions may cause interruptions to our operations, products and services and may incur additional compliance cost, which may in turn materially and adversely affect our business, financial condition and results of operations. 46 Table of Contents Any of these events could cause significant disruption to our business operations and severely damage our reputation, which would in turn have a material adverse effect on our business, financial condition and results of operations.
Such restrictions may cause interruptions to our operations, products and services and may incur additional compliance cost, which may in turn materially and adversely affect our business, financial condition and results of operations. 48 Table of Contents Any of these events could cause significant disruption to our business operations and severely damage our reputation, which would in turn have a material adverse effect on our business, financial condition and results of operations.
We have used our best efforts to notify PRC residents or entities who directly or indirectly hold shares in our Cayman Islands holding company and who are known to us as being PRC residents or entities to timely complete the foreign exchange registrations and the changes and annual filings of its existing rights under offshore direct investment.
We have used reasonable efforts to notify PRC residents or entities who directly or indirectly hold shares in our Cayman Islands holding company and who are known to us as being PRC residents or entities to timely complete the foreign exchange registrations and the changes and annual filings of its existing rights under offshore direct investment.
See “—If we are classified as a PRC resident enterprise for PRC income tax purposes, such classification could result in unfavorable tax consequences to us and our non-PRC shareholders or ADS holders.” Increases in labor costs and enforcement of stricter labor laws and regulations in China may adversely affect our business and our profitability.
See “—If we are classified as a PRC resident enterprise for PRC income tax purposes, such classification could result in unfavorable tax consequences to us and our non-PRC shareholders or ADS holders.” Enforcement of stricter labor laws and regulations in China may adversely affect our business and our profitability.
Our hardware management system enables us to see in precise detail the locations and numbers of our devices, and our business intelligence system makes predictions of future power bank and cabinet needs. We also conduct regular meetings with local business development personnel to further gauge their needs for power banks and cabinets.
Our hardware management system enables us to see in precise detail the locations and numbers of our devices, and our business intelligence system makes predictions of future power bank and cabinet needs. We also conduct regular meetings with local business development personnel and network partners to further gauge their needs for power banks and cabinets.
However, if Smart Share International Limited is not considered to be the beneficial owner of the dividends paid to it by Zhixiang Investment WFOE, Zhixiang WFOE and Tianhui Co., Ltd. under the tax circulars promulgated in February 2009 and February 2018, such dividends would be subject to withholding tax at a rate of 10%.
However, if Smart Share International Limited is not considered to be the beneficial owner of the dividends paid to it by Zhixiang Investment WFOE, Zhixiang WFOE and Tianhui WFOE under the tax circulars promulgated in February 2009 and February 2018, such dividends would be subject to withholding tax at a rate of 10%.
Additionally, we may be subject to new laws and regulations which may materially and adversely affect our business, financial condition and results of operations.” 30 Table of Contents Various possible market and consumer behavior trends may adversely affect the demand and pricing for our products and services and thus our financial performance and business prospects.
Additionally, we may be subject to new laws and regulations which may materially and adversely affect our business, financial condition and results of operations.” 32 Table of Contents Various possible market and consumer behavior trends may adversely affect the demand and pricing for our products and services and thus our financial performance and business prospects.
Accordingly, holders of ADSs may be unable to participate in our rights offerings and may experience dilution of their holdings as a result. 66 Table of Contents You may not receive cash dividends if the depositary decides it is impractical to make them available to you.
Accordingly, holders of ADSs may be unable to participate in our rights offerings and may experience dilution of their holdings as a result. 69 Table of Contents You may not receive cash dividends if the depositary decides it is impractical to make them available to you.
For the years ended December 31, 2021, 2022 and 2023, no assets other than cash were transferred between our company and our PRC subsidiaries and the variable interest entities, no subsidiaries paid dividends or made other distributions to Smart Share Global Limited, and no dividends or distributions were paid or made to U.S. investors.
For the years ended December 31, 2022, 2023 and 2024, no assets other than cash were transferred between our company and our PRC subsidiaries and the variable interest entities, no subsidiaries paid dividends or made other distributions to Smart Share Global Limited, and no dividends or distributions were paid or made to U.S. investors.
POI coverage expansion in new markets may be subject to risks such as: ● limited brand recognition (compared with our established markets); ● limited demand for our products and services; ● costs associated with expanding our location partner and network partner network; 23 Table of Contents ● adjustment to local consumers’ preferences and customs; ● compliance with local regulations and policies; ● difficulties in staffing and managing local operations; ● application of our operational excellence in new markets; and ● competition with new competitors with established local presence.
POI coverage expansion in new markets may be subject to risks such as: ● limited brand recognition (compared with our established markets); ● limited demand for our products and services; ● costs associated with expanding our location partner and network partner network; ● adjustment to local consumers’ preferences and customs; ● compliance with local regulations and policies; ● difficulties in staffing and managing local operations; ● application of our operational excellence in new markets; and ● competition with new competitors with established local presence.
We have relied on home country practice in not having the majority of our board of directors composed of independent directors and did not hold an annual meeting of shareholders for 2023. We may choose to follow other home country practices in the future.
We have relied on home country practice in not having the majority of our board of directors composed of independent directors and did not hold an annual meeting of shareholders for 2024. We may choose to follow other home country practices in the future.
Risk Factors—Risks Relating to Our Corporate Structure—If the PRC government finds that the agreements that establish the structure for operating some of our operations in China do not comply with PRC regulations relating to the relevant industries, or if these regulations or the interpretation of existing regulations change in the future, we could be subject to severe penalties or be forced to relinquish our interests in those operations.” on page 45 . ● We rely on contractual arrangements with the VIE and its respective shareholders for our operations in China, which may not be as effective in providing operational control as direct ownership.
Risk Factors—Risks Relating to Our Corporate Structure—If the PRC government finds that the agreements that establish the structure for operating some of our operations in China do not comply with PRC regulations relating to the relevant industries, or if these regulations or the interpretation of existing regulations change in the future, we could be subject to severe penalties or be forced to relinquish our interests in those operations” on page 47 . ● We rely on contractual arrangements with the VIE and its respective shareholders for our operations in China, which may not be as effective in providing operational control as direct ownership.
Risk Factors—Risks Relating to Our Business and Industry—We have incurred net loss in the past, and we may not be able to achieve or maintain profitability in the future.” on page 23 . ● We are subject to a variety of costs, risks and uncertainties in executing our growth strategies, and our results of operations and business prospects could be materially and adversely affected as a result.
Risk Factors—Risks Relating to Our Business and Industry—We have incurred net loss in the past, and we may not be able to achieve or maintain profitability in the future” on page 23 . ● We are subject to a variety of costs, risks and uncertainties in executing our growth strategies, and our results of operations and business prospects could be materially and adversely affected as a result.
However, such measures have not been fully implemented and we concluded that the material weaknesses and deficiencies in our internal control over financial reporting have not been remediated as of December 31, 2023. See “Item 15.
However, such measures have not been fully implemented and we concluded that the material weaknesses and deficiencies in our internal control over financial reporting have not been remediated as of December 31, 2024. See “Item 15.
The People’s Bank of China notice intends to prevent unlicensed entities from using licensed payment service providers as a conduit for conducting the unlicensed payment settlement services, so as to safeguard the fund security and information security. 44 Table of Contents We cannot assure you that we will be successful in entering and maintaining amicable relationships with these online payment service providers.
The People’s Bank of China notice intends to prevent unlicensed entities from using licensed payment service providers as a conduit for conducting the unlicensed payment settlement services, so as to safeguard the fund security and information security. We cannot assure you that we will be successful in entering and maintaining amicable relationships with these online payment service providers.
This concentrated control will limit your ability to influence corporate matters and could discourage others from pursuing any potential merger, takeover or other change of control transactions that holders of Class A ordinary shares and ADSs may view as beneficial. 62 Table of Contents The dual-class structure of our ordinary shares may adversely affect the trading market for our ADSs.
This concentrated control will limit your ability to influence corporate matters and could discourage others from pursuing any potential merger, takeover or other change of control transactions that holders of Class A ordinary shares and ADSs may view as beneficial. The dual-class structure of our ordinary shares may adversely affect the trading market for our ADSs.
Foreign ownership in entities that provide value-added telecommunication services, with a few exceptions, is subject to restrictions under current PRC laws and regulations. Specifically, foreign ownership of an internet information service provider may not exceed 50%. 45 Table of Contents Our company is a Cayman Islands company and our PRC subsidiaries are considered foreign-invested enterprises.
Foreign ownership in entities that provide value-added telecommunication services, with a few exceptions, is subject to restrictions under current PRC laws and regulations. Specifically, foreign ownership of an internet information service provider may not exceed 50%. Our company is a Cayman Islands company and our PRC subsidiaries are considered foreign-invested enterprises.
Risk Factors—Risks Relating to Doing Business in China—The PCAOB had historically been unable to inspect our auditor in relation to their audit work performed for our financial statements and the inability of the PCAOB to conduct inspections of our auditor in the past has deprived our investors with the benefits of such inspections.” on page 52 . ● Our ADSs may be prohibited from trading in the United States under the HFCAA in the future if the PCAOB is unable to inspect or investigate completely auditors located in China.
Risk Factors—Risks Relating to Doing Business in China—The PCAOB had historically been unable to inspect our auditor in relation to their audit work performed for our financial statements and the inability of the PCAOB to conduct inspections of our auditor in the past has deprived our investors with the benefits of such inspections” on page 53 . ● Our ADSs may be prohibited from trading in the United States under the HFCAA in the future if the PCAOB is unable to inspect or investigate completely auditors located in China.
In addition, our ADSs may decline in value or become worthless if we are unable to assert our contractual rights over the assets of the VIE which contributed immaterial third-party revenues in 2023.
In addition, our ADSs may decline in value or become worthless if we are unable to assert our contractual rights over the assets of the VIE which contributed immaterial third-party revenues in 2024.
If the Cybersecurity Review Measures and the enacted version of the Regulations on the Network Data Security (Draft for Comments) mandate a cybersecurity review and other specific actions to be taken by issuers like us, we face uncertainties as to whether these additional procedures can be completed by us timely, or at all, which may delay or disallow any future listings that we may pursue, subject us to government enforcement actions and investigations, fines, penalties, suspension of our non-compliant operations, or removal of our app from the application stores, and materially and adversely affect our business and results of operations.
If the Cybersecurity Review Measures and the Regulations on the Network Data Security mandate a cybersecurity review and other specific actions to be taken by issuers like us, we face uncertainties as to whether these additional procedures can be completed by us timely, or at all, which may delay or disallow any future listings that we may pursue, subject us to government enforcement actions and investigations, fines, penalties, suspension of our non-compliant operations, or removal of our app from the application stores, and materially and adversely affect our business and results of operations.
As a result, many of these companies are now conducting internal and external investigations into the allegations and, in the interim, are subject to shareholder lawsuits and/or SEC enforcement actions. 63 Table of Contents It is not clear what effect such negative publicity could have on us.
As a result, many of these companies are now conducting internal and external investigations into the allegations and, in the interim, are subject to shareholder lawsuits and/or SEC enforcement actions. It is not clear what effect such negative publicity could have on us.
As advised by our PRC legal counsel, Commerce & Finance Law Offices, (i) as of March 31, 2024, except for the risks as disclosed in “Item 3. Key Information—D.
As advised by our PRC legal counsel, Commerce & Finance Law Offices, (i) as of March 31, 2025, except for the risks as disclosed in “Item 3. Key Information—D.
The Cybersecurity Review Measures and the Regulations on the Network Data Security (Draft for Comments) remain unclear on whether the requirements will be applicable to companies that are already listed in the United States, such as us, if we were to pursue another listing outside of the PRC.
The Cybersecurity Review Measures and the Regulations on the Network Data Security remain unclear on whether the requirements will be applicable to companies that are already listed in the United States, such as us, if we were to pursue another listing outside of the PRC.
Our management has concluded that we did not maintain effective internal control over financial reporting as of December 31, 2023, due to material weaknesses identified.
Our management has concluded that we did not maintain effective internal control over financial reporting as of December 31, 2024, due to material weaknesses identified.
Conversely, a significant depreciation of Renminbi against the U.S. dollar may significantly reduce the U.S. dollar equivalent of our earnings, which in turn could adversely affect the price of our ADSs. 55 Table of Contents Limited hedging options are available in China to reduce our exposure to exchange rate fluctuations.
Conversely, a significant depreciation of Renminbi against the U.S. dollar may significantly reduce the U.S. dollar equivalent of our earnings, which in turn could adversely affect the price of our ADSs. Limited hedging options are available in China to reduce our exposure to exchange rate fluctuations.
Risk Factors—Risks Relating to Doing Business in China—The filing with the China Securities Regulatory Commission is required and approval of other PRC governmental authorities may be required in connection with our offshore offerings under PRC law, and we cannot predict whether or for how long we will be able to obtain such approval or complete such filing.” on page 53 .
Risk Factors—Risks Relating to Doing Business in China—The filing with the China Securities Regulatory Commission is required and approval of other PRC governmental authorities may be required in connection with our offshore offerings under PRC law, and we cannot predict whether or for how long we will be able to obtain such approval or complete such filing” on page 54 .
The Foreign Investment Law and its implementing regulations embody an expected PRC regulatory trend to rationalize its foreign investment regulatory regime in line with prevailing international practice and the legislative efforts to unify the corporate legal requirements for both foreign and domestic investments. 49 Table of Contents However, since these rules are relatively new, uncertainties still exist in relation to their interpretation.
The Foreign Investment Law and its implementing regulations embody an expected PRC regulatory trend to rationalize its foreign investment regulatory regime in line with prevailing international practice and the legislative efforts to unify the corporate legal requirements for both foreign and domestic investments. However, since these rules are relatively new, uncertainties still exist in relation to their interpretation.
We cannot predict the impact of the Cybersecurity Review Measures and the Regulations on the Network Data Security (Draft for Comments), if any, at this stage, and we will closely monitor and assess any development in the rule-making process as to its impact on our business.
We cannot predict the impact of the Cybersecurity Review Measures and the Regulations on the Network Data Security, if any, at this stage, and we will closely monitor and assess any development in the rule-making process as to its impact on our business.
Peifeng Xu beneficially owned 33.6% and 23.5% of the aggregate voting power of our company, respectively. As a result of the dual-class share structure and the concentration of ownership, holders of Class B ordinary shares will have considerable influence over matters such as decisions regarding mergers and consolidations, election of directors and other significant corporate actions.
Peifeng Xu beneficially owned 33.9% and 23.7% of the aggregate voting power of our company, respectively. As a result of the dual-class share structure and the concentration of ownership, holders of Class B ordinary shares will have considerable influence over matters such as decisions regarding mergers and consolidations, election of directors and other significant corporate actions.
As of March 31, 2024, our PRC subsidiaries and the VIE have obtained the requisite licenses and permits from the PRC government authorities that are necessary for our business operations in China, namely, (i) business license, (ii) the value-added telecommunication business license, (iii) the Hi-Tech Enterprise Certificate, (iv) the Filing Certificate for Classified Protection of Information System Security, (v) the Radio Transmission Equipment Type Approval Certificate, (vi) the Food Operation License, (vii) the Liquor Retail License and (viii) the Liquor Wholesale License, and have not been denied such licenses and permits.
As of March 31, 2025, our PRC subsidiaries and the VIE have obtained the requisite licenses and permits from the PRC government authorities that are necessary for our business operations in China, namely, (i) business license, (ii) the value-added telecommunication business license, (iii) the Hi-Tech Enterprise Certificate, (iv) the Filing Certificate for Classified Protection of Information System Security, (v) the Radio Transmission Equipment Type Approval Certificate, (vi) the Food Operation License, (vii) the Liquor Retail License (viii) the Liquor Wholesale License and (ix) the Production Safety Permit , and have not been denied such licenses and permits.
The delisting of the ADSs, or the threat of their being delisted, may materially and adversely affect the value of your investment.” on page 52 . ● The filing with the China Securities Regulatory Commission is required and approval of other PRC governmental authorities may be required in connection with our offshore offerings under PRC law, and we cannot predict whether or for how long we will be able to obtain such approval or complete such filing.
The delisting of the ADSs, or the threat of their being delisted, may materially and adversely affect the value of your investment” on page 54 . ● The filing with the China Securities Regulatory Commission is required and approval of other PRC governmental authorities may be required in connection with our offshore offerings under PRC law, and we cannot predict whether or for how long we will be able to obtain such approval or complete such filing.
Smart Share International Limited, which directly owns our PRC subsidiaries, Zhixiang Investment WFOE, Zhixiang WFOE and Tianhui Co., Ltd., is incorporated in Hong Kong.
Smart Share International Limited, which directly owns our PRC subsidiaries, Zhixiang Investment WFOE, Zhixiang WFOE and Tianhui WFOE, is incorporated in Hong Kong.
We operate in a highly competitive industry, and our competitors may compete more effectively than we can, which could adversely affect our results of operations and financial condition. The mobile device charging service industry, despite being relatively new, is competitive with a number of large-scale participants that may possess more resources that we do.
We operate in a highly competitive industry, and our competitors may compete more effectively than we can, which could adversely affect our results of operations and financial condition. The mobile device charging service industry is competitive with a number of large-scale participants that may possess more resources that we do.
If we are not able to manage our growth or execute our strategies effectively, our expansion may not be successful and our business prospects may be materially and adversely affected. We may enter into new markets where we have limited or no experience in marketing, selling, and localizing and deploying our products and services.
If we are not able to manage our growth or execute our strategies effectively, our expansion may not be successful and our business prospects may be materially and adversely affected. 23 Table of Contents We may enter into new markets where we have limited or no experience in marketing, selling, and localizing and deploying our products and services.
Risk Factors—Risks Relating to Doing Business in China—Changes in China’s economic, political or social conditions or government policies could have a material and adverse effect on our business and results of operations.” on page 50 . ● While this may apply to other jurisdictions, the changes, interpretation and enforcement of PRC laws and regulations could limit the legal protections available to you and us.
Risk Factors—Risks Relating to Doing Business in China—Changes in China’s economic, political or social conditions or government policies could have a material and adverse effect on our business and results of operations” on page 52 . ● While this may apply to other jurisdictions, the changes, interpretation and enforcement of PRC laws and regulations could limit the legal protections available to you and us.
Risk Factors—Risks Relating to Doing Business in China—While this may apply to other jurisdictions, the changes, interpretation and enforcement of PRC laws and regulations could limit the legal protections available to you and us.” on page 50 . ● The PRC government’s oversight over our business operation could result in a material adverse change in our operations and the value of our ADSs.
Risk Factors—Risks Relating to Doing Business in China—While this may apply to other jurisdictions, the changes, interpretation and enforcement of PRC laws and regulations could limit the legal protections available to you and us” on page 52 . ● The PRC government’s oversight over our business operation could result in a material adverse change in our operations and the value of our ADSs.
See “Item 3. Key Information—D. Risk Factors—Risks Relating to Doing Business in China—The PRC government’s oversight over our business operation could result in a material adverse change in our operations and the value of our ADSs.” on page 51 . ● The PCAOB had historically been unable to inspect our auditor in relation to their audit work. See “Item 3.
See “Item 3. Key Information—D. Risk Factors—Risks Relating to Doing Business in China—The PRC government’s oversight over our business operation could result in a material adverse change in our operations and the value of our ADSs” on page 53 . ● The PCAOB had historically been unable to inspect our auditor in relation to their audit work. See “Item 3.
See “Item 3. Key Information—D. Risk Factors—Risks Relating to Our ADSs—Our dual-class voting structure will limit your ability to influence corporate matters and could discourage others from pursuing any change of control transactions that holders of our Class A ordinary shares and ADSs may view as beneficial.” on page 62 .
See “Item 3. Key Information—D. Risk Factors—Risks Relating to Our ADSs—Our dual-class voting structure will limit your ability to influence corporate matters and could discourage others from pursuing any change of control transactions that holders of our Class A ordinary shares and ADSs may view as beneficial” on page 65 .
In the event that any fine is imposed on us for our failure to register our lease agreements, we may not be able to recover such losses from the lessors. 42 Table of Contents We have limited insurance coverage, which could expose us to significant costs.
In the event that any fine is imposed on us for our failure to register our lease agreements, we may not be able to recover such losses from the lessors. We have limited insurance coverage, which could expose us to significant costs.

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Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Our business development personnel incentive system is designed to optimize our business development personnel’s efficiency and performance by aligning their interests with ours and promoting sustainable growth. The incentive system is based on an evaluation matrix.
Incentive. Our business development personnel incentive system is designed to optimize our business development personnel’s efficiency and performance by aligning their interests with ours and promoting sustainable growth. The incentive system is based on an evaluation matrix.
Starting in the second quarter of 2023, we have shifted the principal role of providing mobile device charging services from us to network partners. The ownership rights of cabinets and power banks under the network partner model, which were previously held by us, have been transferred to the network partners under the new arrangement.
Starting in the second quarter of 2023, we have shifted the principal role of providing mobile device charging services from us to network partners. The ownership rights of cabinets and power banks under the network partner model, which were previously held by us, have been transferred to the network partners under the new arrangement.
Under the new arrangement, we currently provide mobile device charging solutions to network partners, including software and system service, billing and settlement service, customer call center service and other services. Network partners continue to be responsible for the management of their own power banks and cabinets, business development, POI sourcing and contract negotiation.
Under the new arrangement, we currently provide mobile device charging solutions to network partners, including software and system service, billing and settlement service, customer call center service and other services. Network partners continue to be responsible for the management of their own power banks and cabinets, business development, POI sourcing and contract negotiation.
Furthermore, any individual or entity that (i) sells or distributes personal information in a manner which violates the regulations, or (ii) steals or illegally obtains any personal information is subject to criminal penalty in severe circumstances. 89 Table of Contents On June 1, 2017, the Cyber Security Law of the People’s Republic of China promulgated by the Standing Committee of the National People’s Congress took effect, which is formulated to maintain network security, safeguard cyberspace sovereignty, national security and public interests, protect the lawful rights and interests of citizens, legal persons and other organizations, and require that a network operator, which includes, among others, internet information services providers, take technical measures and other necessary measures to safeguard the safe and stable operation of networks, effectively respond to network security incidents, prevent illegal and criminal activities, and maintain the integrity, confidentiality and availability of network data.
Furthermore, any individual or entity that (i) sells or distributes personal information in a manner which violates the regulations, or (ii) steals or illegally obtains any personal information is subject to criminal penalty in severe circumstances. 93 Table of Contents On June 1, 2017, the Cyber Security Law of the People’s Republic of China promulgated by the Standing Committee of the National People’s Congress took effect, which is formulated to maintain network security, safeguard cyberspace sovereignty, national security and public interests, protect the lawful rights and interests of citizens, legal persons and other organizations, and require that a network operator, which includes, among others, internet information services providers, take technical measures and other necessary measures to safeguard the safe and stable operation of networks, effectively respond to network security incidents, prevent illegal and criminal activities, and maintain the integrity, confidentiality and availability of network data.
On July 6, 2021, the General Office of the CPC Central Committee and the General Office of the State Council jointly promulgated the Opinions on Strictly Cracking Down on Illegal Securities Activities in Accordance with the Law, which emphasized the need to strengthen cross-border regulatory collaboration and to improve laws and regulations on data security, cross-border data transmission, and confidential information management, and provided that efforts will be made to amend the regulations on strengthening the confidentiality and file management framework relating to the offering and listing of securities overseas, to enforce the responsibility of overseas listed companies with respect to information security, and to strengthen and standardize the management of cross-border information transmission mechanisms and procedures. 90 Table of Contents On August 20, 2021, the Standing Committee of the National People’s Congress promulgated the Personal Information Protection Law, which integrates the scattered rules with respect to personal information rights and privacy protection and took effect in November 2021.
On July 6, 2021, the General Office of the CPC Central Committee and the General Office of the State Council jointly promulgated the Opinions on Strictly Cracking Down on Illegal Securities Activities in Accordance with the Law, which emphasized the need to strengthen cross-border regulatory collaboration and to improve laws and regulations on data security, cross-border data transmission, and confidential information management, and provided that efforts will be made to amend the regulations on strengthening the confidentiality and file management framework relating to the offering and listing of securities overseas, to enforce the responsibility of overseas listed companies with respect to information security, and to strengthen and standardize the management of cross-border information transmission mechanisms and procedures. 94 Table of Contents On August 20, 2021, the Standing Committee of the National People’s Congress promulgated the Personal Information Protection Law, which integrates the scattered rules with respect to personal information rights and privacy protection and took effect in November 2021.
Where the legal representative, principal and directly responsible person of an undertaking are personally responsible for entering into a monopolistic agreement, a fine of not more than RMB1 million may be imposed. 92 Table of Contents Regulations Relating to Foreign Sanctions According to the Anti-Foreign Sanctions Law of the PRC, which was released by the Standing Committee of the National People’s Congress on June 10, 2021 and became effective on the same day, the determination, suspension, modification or cancellation of the countermeasures List and the countermeasures shall be promulgated under orders of the Ministry of Foreign Affairs or other departments of the State Council.
Where the legal representative, principal and directly responsible person of an undertaking are personally responsible for entering into a monopolistic agreement, a fine of not more than RMB1 million may be imposed. 96 Table of Contents Regulations Relating to Foreign Sanctions According to the Anti-Foreign Sanctions Law of the PRC, which was released by the Standing Committee of the National People’s Congress on June 10, 2021 and became effective on the same day, the determination, suspension, modification or cancellation of the countermeasures List and the countermeasures shall be promulgated under orders of the Ministry of Foreign Affairs or other departments of the State Council.
In order to further implement the Regulations on Computer Software Protection, promulgated by the State Council on June 4, 1991, and was amended on December 20, 2001, January 8, 2011 and January 30, 2013, respectively, the National Copyright Administration issued the Measures for the Registration of Computer Software Copyright on February 20, 2002, which specify detailed procedures and requirements with respect to the registration of software copyrights. 93 Table of Contents Trademark According to the Trademark Law of the People’s Republic of China promulgated by the Standing Committee of the National People’s Congress on August 23, 1982, and amended on February 22, 1993, October 27, 2001, August 30, 2013 and April 23, 2019, respectively, the Trademark Office of the State Administration for Industry and Commerce is responsible for the registration and administration of trademarks in China.
In order to further implement the Regulations on Computer Software Protection, promulgated by the State Council on June 4, 1991, and was amended on December 20, 2001, January 8, 2011 and January 30, 2013, respectively, the National Copyright Administration issued the Measures for the Registration of Computer Software Copyright on February 20, 2002, which specify detailed procedures and requirements with respect to the registration of software copyrights. 97 Table of Contents Trademark According to the Trademark Law of the People’s Republic of China promulgated by the Standing Committee of the National People’s Congress on August 23, 1982, and amended on February 22, 1993, October 27, 2001, August 30, 2013 and April 23, 2019, respectively, the Trademark Office of the State Administration for Industry and Commerce is responsible for the registration and administration of trademarks in China.
However, the non-financial enterprise shall report its international income and expenditure regularly. 95 Table of Contents Regulations Relating to Offshore Special Purpose Vehicles Held by PRC Residents SAFE promulgated the Circular on Printing and Distributing the Provisions on Foreign Exchange Administration over Domestic Direct Investment by Foreign Investors and the Supporting Documents on May 10, 2013, which was amended on October 10, 2018 and on December 30, 2019, which specifies that the administration by SAFE or its local branches over direct investment by foreign investors in the PRC shall be conducted by way of registration and banks shall process foreign exchange business relating to the direct investment in the PRC based on the registration information provided by SAFE and its branches.
However, the non-financial enterprise shall report its international income and expenditure regularly. 99 Table of Contents Regulations Relating to Offshore Special Purpose Vehicles Held by PRC Residents SAFE promulgated the Circular on Printing and Distributing the Provisions on Foreign Exchange Administration over Domestic Direct Investment by Foreign Investors and the Supporting Documents on May 10, 2013, which was amended on October 10, 2018 and on December 30, 2019, which specifies that the administration by SAFE or its local branches over direct investment by foreign investors in the PRC shall be conducted by way of registration and banks shall process foreign exchange business relating to the direct investment in the PRC based on the registration information provided by SAFE and its branches.
The Interim Regulations on Value-Added Tax of the People’s Republic of China will be repealed on the same day the second revised draft comes into effect. 98 Table of Contents On April 4, 2018, the Ministry of Finance and the State Administration of Taxation jointly promulgated the Circular of the Ministry of Finance and the State Administration of Taxation on Adjustment of Value-Added Tax Rates, according to which, (i) for VAT taxable sales acts or import of goods originally subject to VAT rates of 17% and 11%, respectively, such tax rates shall be adjusted to 16% and 10%, respectively; (ii) for exported goods originally subject to tax rate of 17% and export tax refund rate of 17%, the export tax refund rate shall be adjusted to 16%; and (iii) for exported goods and cross-border taxable acts originally subject to tax rate of 11% and export tax refund rate of 11%, the export tax refund rate shall be adjusted to 10%.
The Interim Regulations on Value-Added Tax of the People’s Republic of China will be repealed on the same day the second revised draft comes into effect. 102 Table of Contents On April 4, 2018, the Ministry of Finance and the State Administration of Taxation jointly promulgated the Circular of the Ministry of Finance and the State Administration of Taxation on Adjustment of Value-Added Tax Rates, according to which, (i) for VAT taxable sales acts or import of goods originally subject to VAT rates of 17% and 11%, respectively, such tax rates shall be adjusted to 16% and 10%, respectively; (ii) for exported goods originally subject to tax rate of 17% and export tax refund rate of 17%, the export tax refund rate shall be adjusted to 16%; and (iii) for exported goods and cross-border taxable acts originally subject to tax rate of 11% and export tax refund rate of 11%, the export tax refund rate shall be adjusted to 10%.
If CSRC approval is required, it is uncertain whether it would be possible for us to obtain the approval and any failure to obtain or delay in obtaining CSRC approval for our overseas offering would subject us to sanctions imposed by the CSRC and other PRC regulatory agencies. 99 Table of Contents The M&A Rules, and other regulations and rules concerning mergers and acquisitions established additional procedures and requirements that could make merger and acquisition activities by foreign investors more time consuming and complex.
If CSRC approval is required, it is uncertain whether it would be possible for us to obtain the approval and any failure to obtain or delay in obtaining CSRC approval for our overseas offering would subject us to sanctions imposed by the CSRC and other PRC regulatory agencies. 103 Table of Contents The M&A Rules, and other regulations and rules concerning mergers and acquisitions established additional procedures and requirements that could make merger and acquisition activities by foreign investors more time consuming and complex.
If the employees fail to pay or the PRC subsidiaries fail to withhold income tax in accordance with applicable laws and regulations, the PRC subsidiaries may face sanctions imposed by the tax authorities or other PRC governmental authorities. 96 Table of Contents Regulation on Outbound Direct Investment On December 26, 2017, the NDRC promulgated the Administrative Measures for the Outbound Investment of Enterprises, which took effect on March 1, 2018.
If the employees fail to pay or the PRC subsidiaries fail to withhold income tax in accordance with applicable laws and regulations, the PRC subsidiaries may face sanctions imposed by the tax authorities or other PRC governmental authorities. 100 Table of Contents Regulation on Outbound Direct Investment On December 26, 2017, the NDRC promulgated the Administrative Measures for the Outbound Investment of Enterprises, which took effect on March 1, 2018.
Shanghai Zhixiang further undertakes that, without Zhixiang WFOE’s prior written consent, it will not, among other things, sell, transfer, pledge, or permit others to use or otherwise dispose of such assets. The exclusive asset subscription agreement has a term of 10 years and can be extended at Zhixiang WFOE’s option. 102 Table of Contents Exclusive Call Option Agreement.
Shanghai Zhixiang further undertakes that, without Zhixiang WFOE’s prior written consent, it will not, among other things, sell, transfer, pledge, or permit others to use or otherwise dispose of such assets. The exclusive asset subscription agreement has a term of 10 years and can be extended at Zhixiang WFOE’s option. 106 Table of Contents Exclusive Call Option Agreement.
The safe harbors include qualified group restructurings, public market trades and exemptions under tax treaties or arrangements. 97 Table of Contents On October 17, 2017, the State Administration of Taxation issued the Announcement on Issues Relating to Withholding at Source of Income Tax of Non-resident Enterprises, or SAT Circular 37, which took effect on December 1, 2017.
The safe harbors include qualified group restructurings, public market trades and exemptions under tax treaties or arrangements. 101 Table of Contents On October 17, 2017, the State Administration of Taxation issued the Announcement on Issues Relating to Withholding at Source of Income Tax of Non-resident Enterprises, or SAT Circular 37, which took effect on December 1, 2017.
Furthermore, after a domestic company has offered and listed securities in an overseas markets, it is required to file a report with the CSRC after the occurrence and public disclosure of certain material corporate events, including but not limited to, change of control and voluntary or mandatory delisting. 100 Table of Contents C.
Furthermore, after a domestic company has offered and listed securities in an overseas markets, it is required to file a report with the CSRC after the occurrence and public disclosure of certain material corporate events, including but not limited to, change of control and voluntary or mandatory delisting. 104 Table of Contents C.
Our power banks are easily portable, with a size of just 145.8*68.8*14.7mm (approximately 5.7*2.7*0.6 inches) and weight of approximately 160g (5.6 oz), barely larger than a common mobile phone. Quality and capacity. Our power banks have a battery capacity of 3.7V/5000mAh.
Our power banks are easily portable, with a size of just 145.8*68.8*14.7 mm (approximately 5.7*2.7*0.6 inches) and weight of approximately 160g (5.6 oz), barely larger than a common mobile phone. Quality and capacity. Our power banks have a battery capacity of 3.7V/5000mAh.
According to the Negative List 2021, the foreign investment in value-added telecommunications services shall not exceed 50% (excluding e-commerce, domestic multi-party telecommunication, storage and forwarding business and call center).
According to the Negative List 2024, the foreign investment in value-added telecommunications services shall not exceed 50% (excluding e-commerce, domestic multi-party telecommunication, storage and forwarding business and call center).
As of the date of this annual report, we had never had an incident caused by quality issues of our products. Durability. Our power banks are tested to have a battery life of at least 500 full charging cycles. Appearance. Our power banks have a chic, streamlined design that fits the aesthetics of the younger generation.
As of the date of this annual report, we had never had any material incident caused by quality issues of our products. Durability. Our power banks are tested to have a battery life of at least 500 full charging cycles. Appearance. Our power banks have a chic, streamlined design that fits the aesthetics of the younger generation.
According to the current regulations, any industry not listed in the Negative List 2021 is a permitted industry and generally open to foreign investment unless specifically prohibited or restricted by PRC laws and regulations.
According to the current regulations, any industry not listed in the Negative List 2024 is a permitted industry and generally open to foreign investment unless specifically prohibited or restricted by PRC laws and regulations.
The following is a summary of the currently effective contractual arrangements by and among Zhixiang WFOE, Shanghai Zhixiang and its shareholders. 101 Table of Contents Agreements that provide us with effective control over Shanghai Zhixiang Proxy Agreements.
The following is a summary of the currently effective contractual arrangements by and among Zhixiang WFOE, Shanghai Zhixiang and its shareholders. 105 Table of Contents Agreements that provide us with effective control over Shanghai Zhixiang Proxy Agreements.
We have established a dedicated team of process improvement personnel to assess and upgrade our R&D process in order to optimize our R&D speed and efficiency. 79 Table of Contents Supply Chain Our highly efficient supply chain management, including our raw materials and components procurement, as well as manufacturing and hardware management, is crucial to our superior products and operational efficiency.
We have established a dedicated team of process improvement personnel to assess and upgrade our R&D process in order to optimize our R&D speed and efficiency. Supply Chain Our highly efficient supply chain management, including our raw materials and components procurement, as well as manufacturing and hardware management, is crucial to our superior products and operational efficiency.
The examination results are recorded on a set of product sample documents, which are further reviewed and approved before they are handed over to our assembly partners. 80 Table of Contents For our existing product lines, we also have a quality assurance team that establishes, communicates and monitors quality standards by product category.
The examination results are recorded on a set of product sample documents, which are further reviewed and approved before they are handed over to our assembly partners. For our existing product lines, we also have a quality assurance team that establishes, communicates and monitors quality standards by product category.
See “Our hardware and business intelligence system.” Our power banks We have designed and co-designed our power banks to make them user-friendly and deliver the best user experience. We select assembly partners and suppliers based on a variety of criteria including their industry experience and the quality of their products and services.
See “Our hardware and business intelligence system.” Our power banks We have designed and co-designed our power banks to make them user-friendly and deliver the best user experience. We select assembly partners and suppliers based on a variety of criteria including their industry experience and the quality of their products and services. Our power banks have the following features: Compatibility.
The latest amended Company Law will come into effect on July 1, 2024. The main amendments in the Company Law include improving a company’s establishment and exit system, optimizing a company’s organizational structure, detailing exercise of shareholder rights, perfecting a company’s capital system and strengthening the responsibilities of controlling shareholders and management personnel, etc.
The latest amended Company Law came into effect on July 1, 2024. The main amendments in the Company Law include improving a company’s establishment and exit system, optimizing a company’s organizational structure, detailing exercise of shareholder rights, perfecting a company’s capital system and strengthening the responsibilities of controlling shareholders and management personnel, etc.
They have slots where power banks are stored and released, in which the power banks are charged. We currently have models of cabinets with different power bank storage capacity and internet connection modes to fit every POI use case. We continue to design and launch newer generations of cabinets.
They have slots where power banks are stored and released, in which the power banks are charged. We currently have models of cabinets with different power bank storage capacity and internet connection modes to fit every POI use case. 82 Table of Contents We continue to design and launch newer generations of cabinets.
With the assistance of these effective automation tools, business development personnel are able to actively engage with location partners and improve their performance. Location partner and POI database. Our in-house database of location partners and POIs encourages and facilitates collaboration among business development personnel. The database contains potential target POIs.
With the assistance of these effective automation tools, business development personnel are able to actively engage with location partners and improve their performance. 81 Table of Contents Location partner and POI database. Our in-house database of location partners and POIs encourages and facilitates collaboration among business development personnel. The database contains potential target POIs.
We have also invested in the optimization of production line of our products. We have collaborated with our assembly partners to co-research ways to improve the manufacturing process and efficiency. Dynamic warehousing and logistics Efficiency and cost control are the key elements to our warehousing and logistics management.
We have also invested in the optimization of production line of our products. We have collaborated with our assembly partners to co-research ways to improve the manufacturing process and efficiency. 84 Table of Contents Dynamic warehousing and logistics Efficiency and cost control are the key elements to our warehousing and logistics management.
We share tried-and-true operational know-hows on the development and management of POIs to our network partners based on our years of experience in operating the direct model, providing them with the experience and expertise necessary to scale their operation.
We share tried-and-true operational know-hows on the development and management of POIs to our network partners based on our years of experience in operating the direct model, providing them with the experience and expertise necessary to scale their operation. One-stop solution .
Our business intelligence system generates POI activity heat maps and data analysis on targeted POI coverage, which give our business development personnel, network partners and management holistic pictures of our operations and assist them with business planning. CRM and ERP systems .
Our business intelligence system generates POI activity heat maps and data analysis on targeted POI coverage, which give our business development personnel, network partners and management holistic pictures of our operations and assist them with business planning. 83 Table of Contents CRM and ERP systems .
Foreign - invested companies must comply with the Company Law, unless otherwise stipulated by foreign investment laws. The Foreign Investment Law of the PRC was formally adopted by the National People’s Congress on March 15, 2019 and became effective on January 1, 2020.
Foreign - invested companies must comply with the Company Law, unless otherwise stipulated by foreign investment laws. 87 Table of Contents The Foreign Investment Law of the PRC was formally adopted by the National People’s Congress on March 15, 2019 and became effective on January 1, 2020.
Mobile device charging service is becoming a value-added yet necessary service to location partners. Our reliable and visible devices attract more customers to our location partners, conveniently meeting their customers’ need to recharge mobile devices. 73 Table of Contents ● User insights. We accumulate valuable user insights from our proprietary real-time hardware management technologies and business intelligence system.
Mobile device charging service is becoming a value-added yet necessary service to location partners. Our reliable and visible devices attract more customers to our location partners, conveniently meeting their customers’ need to recharge mobile devices. ● User insights. We accumulate valuable user insights from our proprietary real-time hardware management technologies and business intelligence system.
These draft regulations provide that data processors refer to individuals or organizations that, during their data processing activities such as data collection, storage, utilization, transmission, publication and deletion, have autonomy over the purpose and the manner of data processing.
These regulations provide that network data processors refer to individuals or organizations that, during their data processing activities such as data collection, storage, utilization, processing, transmission, provision, publication and deletion, have autonomy over the purpose and the manner of network data processing.
We have also leased an aggregate of approximately 30,000 square meters of office spaces in most of the cities and counties where we have direct operations. Our leases properties in the PRC are primarily used for office, business and warehousing purposes. We lease our warehouses on a need-basis according to our hardware and operations.
We have also leased an aggregate of approximately 3,851 square meters of office spaces in most of the cities and counties where we have direct operations. Our leases properties in the PRC are primarily used for office, business and warehousing purposes. We lease our warehouses on a need-basis according to our hardware and operations.
The operators of non-commercial internet information services must file with responsible governmental authorities and operators of commercial internet information services in China must obtain a license for internet content provision, known as an ICP License, from the governmental authorities, and the provision of particular information services, such as news, publishing, education, healthcare, medicine and medical device must also comply with applicable laws and regulations and obtain the approvals from competent governmental authorities.
The operators of non-commercial internet information services must file with responsible governmental authorities and operators of commercial internet information services in China must obtain a license for internet content provision, known as an ICP License, from the governmental authorities, and the provision of particular information services, such as news, publishing, and education must also comply with applicable laws and regulations and obtain the approvals from competent governmental authorities.
The Special Administrative Measures for Access of Foreign Investments (2021 Edition) was promulgated on December 27, 2021 and became effective on January 1, 2022, or the Negative List 2021, and the Catalog of Industries for Encouraged Foreign Investment (2020 Edition) was promulgated on December 27, 2020 and was amended on October 26, 2022 by the Ministry of Commerce and NDRC which became effective on January 1, 2023, which totally replaced the Catalog.
The Special Administrative Measures for Access of Foreign Investments (2024 Edition) was promulgated on September 6, 2024 and became effective on November 1, 2024, or the Negative List 2024, and the Catalog of Industries for Encouraged Foreign Investment (2020 Edition) was promulgated on December 27, 2020 and was amended on October 26, 2022 by the Ministry of Commerce and NDRC which became effective on January 1, 2023, which totally replaced the Catalog.
In addition, the number of mobile device charging orders was 645.4 million, 552.8 million and 656.4 million in 2021, 2022 and 2023, respectively. We leverage advanced proprietary technologies and big-data analytics capabilities to facilitate seamless transactions, optimize hardware management and obtain valuable user insights.
In addition, the number of mobile device charging orders was 552.8 million, 656.4 million and 574.0 million in 2022, 2023 and 2024, respectively. We leverage advanced proprietary technologies and big-data analytics capabilities to facilitate seamless transactions, optimize hardware management and obtain valuable user insights.
We maintain high operational efficiency among our business development personnel and network partners through our meticulously designed business development management system and proprietary data-driven management tools. 71 Table of Contents We operate our business through the direct model and network partner model.
We maintain high operational efficiency among our business development personnel and network partners through our meticulously designed business development management system and proprietary data-driven management tools. We operate our business through the direct model and network partner model.
The power banks are equipped with cables that are compatible with most mobile devices and can be returned to any of our cabinets nationwide. Users can easily access our power banks through their smart mobile devices and return them at any of our cabinets.
Our power banks are stored in cabinets that we install at POIs. The power banks are equipped with cables that are compatible with most mobile devices and can be returned to any of our cabinets nationwide. Users can easily access our power banks through their smart mobile devices and return them at any of our cabinets.
With our extensive network covering every province of China, users can easily access one of our cabinets at approximately 1,233,900 POIs in more than 2,000 counties and county-level districts in China as of December 31, 2023.
With our extensive network covering every province of China, users can easily access one of our cabinets at approximately 1,279,900 POIs in more than 2,200 counties and county-level districts in China as of December 31, 2024.
We believe that a strong corporate culture is crucial to maintaining operational efficiency. We also believe that our deep know-how can be best utilized and strengthened by a dedicated core team. We therefore implement a well-designed career advancement system for our business development personnel in order to both incentivize their consistent performance and cultivate a tight-knit group.
We also believe that our deep know-how can be best utilized and strengthened by a dedicated core team. We therefore implement a well-designed career advancement system for our business development personnel in order to both incentivize their consistent performance and cultivate a tight-knit group.
As of December 31, 2023, we had a network of approximately 1,233,900 POIs covering more than 2,000 out of the approximate 2,850 counties and county-level districts in China. We had approximately 286.9 million, 333.7 million and 391.5 million cumulative registered users as of December 31, 2021, 2022 and 2023, respectively.
As of December 31, 2024, we had a network of approximately 1,279,900 POIs covering more than 2,200 out of the approximate 2,850 counties and county-level districts in China. We had approximately 333.7 million, 391.5 million and 439.9 million cumulative registered users as of December 31, 2022, 2023 and 2024, respectively.
Our power banks have the following features: 77 Table of Contents Compatibility. All of our power banks are equipped with cables that fit most of mobile devices, a first in the industry. Users can conveniently pull out the suitable cable to charge their devices. Portability.
All of our power banks are equipped with cables that fit most of mobile devices, a first in the industry. Users can conveniently pull out the suitable cable to charge their devices. Portability.
Our office lease agreements expire between 2024 and 2025. 103 Table of Contents Item 4A. Unresolved Staff Comments None.
Our office lease agreements expire between 2025 and 2027. 107 Table of Contents Item 4A. Unresolved Staff Comments None.
We have data disaster recovery procedures in place. We deploy a variety of technical solutions to prevent and detect risks and vulnerabilities in user privacy and data security, such as encryption, firewall, vulnerability scanning and log audit.
To minimize the risk of data loss, we conduct regular data backup and data recovery tests. We have data disaster recovery procedures in place. We deploy a variety of technical solutions to prevent and detect risks and vulnerabilities in user privacy and data security, such as encryption, firewall, vulnerability scanning and log audit.
The foreign exchange incomes of capital accounts and capital in RMB obtained by the foreign invested enterprise from foreign exchange settlement shall not be used for the following purposes: (i) directly or indirectly used for the payment beyond the business scope of the enterprises or the payment prohibited by applicable laws and regulations; (ii) directly or indirectly used for investment in securities or financial schemes other than bank guaranteed products unless otherwise provided by applicable laws and regulations; (iii) used for granting loans to nonaffiliated enterprises, unless otherwise permitted by its business scope; and (iv) used for the construction or purchase of real estate that is not for self-use (except for real estate enterprises).
The foreign exchange incomes of capital accounts and capital in RMB obtained by the foreign invested enterprise from foreign exchange settlement shall not be used for the following purposes: (i) directly or indirectly used for the payment beyond the business scope of the enterprises or the payment prohibited by applicable laws and regulations; (ii) directly or indirectly used for securities investment or other investment management purposes (except for financial products with a risk rating of no higher than Level 2 and structured deposits) unless otherwise provided by applicable laws and regulations; (iii) used for granting loans to nonaffiliated enterprises, unless otherwise permitted by its business scope; and (iv) used for the purchase of real estate that is not for self-use (except for enterprises engaged in real estate development or real estate leasing operations).
With certain key accounts, we integrate our service into their portals (such as their own mini programs) in order to bring a more engaging experience for their customers. Such collaborations boost our brand reputation among the top key accounts’ customers.
With certain key accounts, we integrate our service into their portals (such as their own mini programs) in order to bring a more engaging experience for their customers.
They are incentivized to continue acquiring new network partners and support the growth of existing ones. Our commitment extends beyond the initial onboarding process, with ongoing assistance, training and data support provided to network partners in order to foster sustained growth and success within our network partner ecosystem.
Our commitment extends beyond the initial onboarding process, with ongoing assistance, training and data support provided to network partners in order to foster sustained growth and success within our network partner ecosystem.
We carefully design and continually improve an evaluation matrix to manage our direct model team. Through our expertise, technologies and experience in the market, we have accumulated ample know-hows in operations and efficient business expansion.
We also leverage an array of AI-enabled technologies to boost our performance and power bank utilization in our direct model. We carefully design and continually improve an evaluation matrix to manage our direct model team. Through our expertise, technologies and experience in the market, we have accumulated ample know-hows in operations and efficient business expansion.
By collaborating with us, our IP partners can boost their brand images and awareness among a coveted demographic in China. Mini programs Users can access our mini programs by scanning the QR codes on our cabinets, searching for or directly launching our mini programs. Location. Upon opening the mini program, users are shown a map view with our cabinets’ locations.
By collaborating with us, our IP partners can boost their brand images and awareness among a coveted demographic in China. Mini programs Users can access our mini programs by scanning the QR codes on our cabinets, searching for or directly launching our mini programs. 77 Table of Contents Location.
To increase the awareness of our industry and our brand, we have sponsored large offline events such as music festivals and globally renowned conferences. We choose these events carefully to fit our brand image and attract young users.
Such collaborations boost our brand reputation among the top key accounts’ customers. 85 Table of Contents To increase the awareness of our industry and our brand, we have sponsored large offline events such as music festivals and globally renowned conferences. We choose these events carefully to fit our brand image and attract young users.
Users are also able to submit claims through email, a designated hotline and sometimes business development personnel. We strive to resolve 100% of the inquiries within 48 hours. 81 Table of Contents Data Privacy and Protection We are committed to protecting the information and privacy of our users.
Users are also able to submit claims through email, a designated hotline and sometimes business development personnel. We strive to resolve 100% of the inquiries within 48 hours. Data Privacy and Protection We are committed to protecting the information and privacy of our users. We have developed a company-wide policy on data security to preserve individual personal information and privacy.
Furthermore, the Personal Information Protection Law also provides for the rights of individuals whose personal information is processed, and takes special care of the personal information of children under 14 and sensitive personal information. In November 2021, the CAC released the Regulations on the Network Data Security (Draft for Comments).
Furthermore, the Personal Information Protection Law also provides for the rights of individuals whose personal information is processed, and takes special care of the personal information of children under 14 and sensitive personal information. In September 2024, the CAC released the Regulations on the Network Data Security, which became effective on January 1, 2025.
According to SAFE Circular 19, the foreign currency capital contribution to a foreign invested enterprise in its capital account may be converted into RMB on a discretional basis. 94 Table of Contents On June 9, 2016, SAFE promulgated the Circular on Reforming and Regulating Policies on the Management of the Settlement of Foreign Exchange of Capital Accounts, or SAFE Circular 16.
According to SAFE Circular 19, the foreign currency capital contribution to a foreign invested enterprise in its capital account may be converted into RMB on a discretional basis. 98 Table of Contents On June 9, 2016, SAFE promulgated the Circular on Reforming and Regulating Policies on the Management of the Settlement of Foreign Exchange of Capital Accounts and revised through SAFE Notice on Further Deepening the Reform to Facilitate Cross-border Trade and Investment on December 4, 2023, or SAFE Circular 16.
Depending on the location, type and foot-traffic of a given POI, we may negotiate different location partner commission rate and duration of the contracts. We believe that aimless expansion without quality is against our operational philosophy.
In most cases, we collect payments from users directly, and settle commissions with location partners on a monthly basis. Depending on the location, type and foot-traffic of a given POI, we may negotiate different location partner commission rate and duration of the contracts. We believe that aimless expansion without quality is against our operational philosophy.
We have designed a multi-layered business development personnel structure with a clear career track and attractive incentives, tied to our evaluation matrix. Our business development personnel are hence encouraged to take long-term views in us.
We have designed a multi-layered business development personnel structure with a clear career track and attractive incentives, tied to our evaluation matrix. Our business development personnel are hence encouraged to take long-term views in us. We have a strong business development personnel retention rate, which helps us to implement our operational philosophy to every aspect of our business. Data-driven tools.
We believe that our ability to compete effectively depends on many factors, including our ability to expand our network, the quality of our power banks and cabinets, our pricing strategies, our pricing competitiveness, our user experience, our technological leadership, our partnership with third parties, our marketing and selling efforts, and the strength and goodwill of our brand.
We believe that our ability to compete effectively depends on many factors, including our ability to expand our network, the quality of our power banks and cabinets, our pricing strategies, our pricing competitiveness, our user experience, our technological leadership, our partnership with third parties, our marketing and selling efforts, and the strength and goodwill of our brand. 86 Table of Contents Furthermore, as our business continues to grow rapidly, we face significant competition for highly skilled personnel, including management, engineers and business development personnel.
We also highlight the locations of customized power banks in reality, for users looking to purchase these collectibles. Scan. By tapping the button on the bottom, users can scan the QR codes on our cabinets from the mini program. They are then shown instructions of how to use our mobile device charging service. Nearby cabinets.
Upon opening the mini program, users are shown a map view with our cabinets’ locations. We also highlight the locations of customized power banks in reality, for users looking to purchase these collectibles. Scan. By tapping the button on the bottom, users can scan the QR codes on our cabinets from the mini program.
We continue to reshape our network partner model based on the development of the industry in order to efficiently scale our mobile device charging network. During the year of 2022, we opened up all direct model regions to network partners in order to further extend our leading market share in existing regions.
During the year of 2022, we opened up all direct model regions to network partners in order to further extend our leading market share in existing regions.
Patent According to the Patent Law of the People’s Republic of China, promulgated by the Standing Committee of the National People’s Congress on March 12, 1984 and amended on September 4, 1992, August 25, 2000, December 27, 2008, and October 17, 2020, the latest amendment took effect on June 1, 2021, respectively, and the Implementation Rules of the Patent Law of the People’s Republic of China, promulgated by the State Council on June 15, 2001 and revised on December 28, 2002 and January 9, 2010, respectively, the patent administrative department under the State Council is responsible for the administration of patent-related work nationwide and the patent administration departments of provincial or autonomous regions or municipal governments are responsible for administering patents within their respective administrative areas.
Patent According to the Patent Law of the People’s Republic of China, promulgated by the Standing Committee of the National People’s Congress on March 12, 1984 and amended on September 4, 1992, August 25, 2000, December 27, 2008, and October 17, 2020, the latest amendment took effect on June 1, 2021, respectively, and the Implementation Rules of the Patent Law of the People’s Republic of China, promulgated by the State Council on June 15, 2001 and revised on December 28, 2002, January 9, 2010, and December 11, 2023 respectively, the latest amendment took effect on January 1, 2024.
As of December 31, 2023, our system actively monitored and processed data from a network of approximately 9.2 million power banks. Our hardware is manufactured under industry-leading quality and safety protocols by top-tier assembly partners, with raw materials and components sourced from renowned suppliers. There are ample opportunities for industry participants to continue expanding into existing and unaddressed use cases.
Our hardware is manufactured under industry-leading quality and safety protocols by top-tier assembly partners, with raw materials and components sourced from renowned suppliers. 74 Table of Contents There are ample opportunities for industry participants to continue expanding into existing and unaddressed use cases.
Foreign investors shall not invest in any forbidden fields stipulated in the negative list and shall meet the conditions stipulated in the negative list before investing in any restricted fields. 83 Table of Contents Foreign investors’ investment, earnings and other legitimate rights and interests within the territory of China shall be protected in accordance with the law, and all national policies on supporting the development of enterprises shall equally apply to foreign-invested enterprises.
Foreign investors’ investment, earnings and other legitimate rights and interests within the territory of China shall be protected in accordance with the law, and all national policies on supporting the development of enterprises shall equally apply to foreign-invested enterprises.
Business development personnel are in charge of managing our relationships with location partners and their key contact persons. They perform regular site-checks to our POIs, and evaluate whether the POIs, our power banks and our cabinets are performing well financially. Business development personnel can switch cabinets or terminate collaborations with location partners if their financials are not satisfactory.
They perform regular site-checks to our POIs, and evaluate whether the POIs, our power banks and our cabinets are performing well financially. Business development personnel can switch cabinets or terminate collaborations with location partners if their financials are not satisfactory. See “—Our Operational Expertise—Dynamic business development personnel management.” ● Network partner program under the direct model .
We gain access to vast amounts of behavioral data through transactions completed on mini programs and we encrypt and store the data on our own and third-party cloud servers, which are protected by advanced anti-hacking measures and firewalls. We collect customer information only with their consents.
We strictly comply with laws and regulations and do not distribute or sell our users’ personal data for any purpose. We gain access to vast amounts of behavioral data through transactions completed on mini programs and we encrypt and store the data on our own and third-party cloud servers, which are protected by advanced anti-hacking measures and firewalls.
On January 6, 2017, the State Administration for Industry and Commerce of PRC issued the Interim Measures for Seven-day Unconditional Return of Online Purchased Goods, which became effective on March 15, 2017 and was amended on October 23, 2020 by the SAMR, further clarifying the scope of consumers’ rights to make returns without cause, including its exceptions, return procedures and online trading platform operators’ responsibility to formulate seven-day unconditional return rules and related consumer protection systems, and supervise merchants for compliance with these rules. 87 Table of Contents Regulations Relating to Pricing In China, the prices of a small number of products and services are guided or fixed by the government.
Moreover, if business operators deceive consumers or knowingly sell substandard or defective products, they should not only compensate consumers for their losses, but also pay additional damages equal to three times the price of the goods or services. 91 Table of Contents On January 6, 2017, the State Administration for Industry and Commerce of PRC issued the Interim Measures for Seven-day Unconditional Return of Online Purchased Goods, which became effective on March 15, 2017 and was amended on October 23, 2020 by the SAMR, further clarifying the scope of consumers’ rights to make returns without cause, including its exceptions, return procedures and online trading platform operators’ responsibility to formulate seven-day unconditional return rules and related consumer protection systems, and supervise merchants for compliance with these rules.
The Energy Monster Experience 72 Table of Contents What we offer We offer users mobile device charging service through power banks at any of our POIs which are typically places with heavy foot traffic. Our power banks are stored in cabinets that we install at POIs.
In 2024, we further expanded our renewable energy business, which generated revenue of RMB479.9 million (US$65.7 million) in 2024. 75 Table of Contents The Energy Monster Experience What we offer We offer users mobile device charging service through power banks at any of our POIs which are typically places with heavy foot traffic.
Where to find our products Our cabinets are widely available, conspicuously placed in diverse offline locations with heavy foot traffic, long operating hours or extended consumer time spend, from shopping malls, movie theatres and restaurants to public transportation hubs and pedestrian walkways.
If a power bank is not returned after a certain period of time, we retain the deposit from users or their digital wallet service providers. 76 Table of Contents Where to find our products Our cabinets are widely available, conspicuously placed in diverse offline locations with heavy foot traffic, long operating hours or extended consumer time spend, from shopping malls, movie theatres and restaurants to public transportation hubs and pedestrian walkways.
In addition, according to the Decision of the State Council on Revising and Repealing Certain Administrative Regulations, foreign ownership in entities that provide value-added telecommunication services (including the radio paging business as part of its basic telecommunications services) shall not exceed 50% ultimately, unless otherwise provided. 85 Table of Contents On July 13, 2006, the Ministry of Information Industry of the PRC, or the MII (which is the predecessor of the MIIT) promulgated the Notice of the Ministry of Information Industry on Strengthening the Administration of Foreign Investment in Value-added Telecommunications Services, which reiterates certain requirements of the FITE Regulations and strengthens the administration by the MII.
In addition, according to the Decision of the State Council on Revising and Repealing Certain Administrative Regulations, foreign ownership in entities that provide value-added telecommunication services (including the radio paging business as part of its basic telecommunications services) shall not exceed 50% ultimately, unless otherwise provided.
In addition, these draft regulations require that data processors that process “important data” or are listed overseas must conduct an annual data security assessment by itself or commission a data security service provider to do so, and submit the assessment report of the preceding year to the municipal cybersecurity department by the end of January each year.
In addition, these regulations require that network data processors that process “important data” must conduct an annual data security assessment by itself, and submit the assessment report to the provincial cybersecurity department or above each year.
Control exists when a foreign investor (i) holds 50% or more equity interests in the enterprise, (ii) has voting rights that can materially impact on the resolutions of the board of directors or shareholders meeting of the enterprise even when it holds less than 50% equity interests in the enterprise, or (iii) has material impact on the enterprise’s business decisions, human resources, accounting and technology. 84 Table of Contents Foreign Investment Industrial Policy Investment in the PRC conducted by foreign investors and foreign-owned enterprises shall comply with the Catalog for the Guidance of Foreign Investment Industries, or the Catalog, which was first issued in 1995 and amended from time to time.
Control exists when a foreign investor (i) holds 50% or more equity interests in the enterprise, (ii) has voting rights that can materially impact on the resolutions of the board of directors or shareholders meeting of the enterprise even when it holds less than 50% equity interests in the enterprise, or (iii) has material impact on the enterprise’s business decisions, human resources, accounting and technology.
Additionally, we provide group accident insurance for all employees and supplementary medical insurance for all management, R&D and other professional personnel. Our product liability insurance covers any claims against us that arises out of defaults of our hardware. We do not maintain business interruption insurance, nor do we maintain key-man life insurance.
Our product liability insurance covers any claims against us that arises out of defaults of our hardware. We do not maintain business interruption insurance, nor do we maintain key-man life insurance.
The negative list management system means that the State implements special administrative procedures for access to foreign investment in specific fields.
The negative list management system means that the State implements special administrative procedures for access to foreign investment in specific fields. Foreign investors shall not invest in any forbidden fields stipulated in the negative list and shall meet the conditions stipulated in the negative list before investing in any restricted fields.
Our network configuration is secured at multiple layers to protect our databases from unauthorized access. To prevent unauthorized access to our system, we utilize a system of firewalls to separate our external-facing services from our internal systems. To minimize the risk of data loss, we conduct regular data backup and data recovery tests.
We collect customer information only with their consents. Our network configuration is secured at multiple layers to protect our databases from unauthorized access. To prevent unauthorized access to our system, we utilize a system of firewalls to separate our external-facing services from our internal systems.
Publishing and circulating advertisements through the internet shall not affect the normal use of the internet by users.
According to these measures, internet advertisers are responsible for the authenticity of the advertisements content. Publishing and circulating advertisements through the internet shall not affect the normal use of the internet by users.
Network partner management We have developed a comprehensive system for the acquisition of new network partners and the operational support for existing network partners. Our network partners team, similarly equipped with comprehensive training and data-driven tools as the direct model team, specializes in the identification and acquisition of new network partners.
Our network partners team, similarly equipped with comprehensive training and data-driven tools as the direct model team, specializes in the identification and acquisition of new network partners. They are incentivized to continue acquiring new network partners and support the growth of existing ones.
On December 19, 2020, the NDRC and the Ministry of Commerce jointly promulgated the Measures on the Security Review of Foreign Investment, effective on January 18, 2021, setting forth provisions concerning the security review mechanism on foreign investment, including the types of investments subject to review, review scopes and procedures, among others.
Failure to make corrections within the specified period may subject the foreign investor to fines of up to RMB300,000, or a fine up to RMB500,000 if other severe violations exist. 88 Table of Contents On December 19, 2020, the NDRC and the Ministry of Commerce jointly promulgated the Measures on the Security Review of Foreign Investment, effective on January 18, 2021, setting forth provisions concerning the security review mechanism on foreign investment, including the types of investments subject to review, review scopes and procedures, among others.
On April 7, 2022, the Decision of the State Council on Revising and Repealing Certain Administrative Regulations was released, effective on May 1, 2022, which deletes certain provisions of the FITE Regulation, including but not limited to Article 9 of the FITE Regulation which provides that the major foreign investor in a foreign-invested telecommunications enterprise that is engaged in value-added telecommunications business shall have a record of good performance and operating experience in managing value-added telecommunications business, and revises certain provisions of the FITE Regulation, including but not limited to the definition of the Foreign-Invested Telecommunications Enterprises.
Furthermore, the foreign party investing in e-commerce business, as a type of value-added telecommunications services, has been allowed to hold up to 100% of the equity interests of the foreign-invested telecommunications enterprise based on the Circular of the Ministry of Industry and Information Technology on Removing the Restrictions on Shareholding Ratio Held by Foreign Investors in Online Data Processing and Transaction Processing (Operating E-commerce) Business issued on June 19, 2015 and the current effective Catalogue of Telecommunications Services. 89 Table of Contents On April 7, 2022, the Decision of the State Council on Revising and Repealing Certain Administrative Regulations was released, effective on May 1, 2022, which deletes certain provisions of the FITE Regulation, including but not limited to Article 9 of the FITE Regulation which provides that the major foreign investor in a foreign-invested telecommunications enterprise that is engaged in value-added telecommunications business shall have a record of good performance and operating experience in managing value-added telecommunications business, and revises certain provisions of the FITE Regulation, including but not limited to the definition of the Foreign-Invested Telecommunications Enterprises.
By leveraging the scale and existing capabilities of our direct model, we have drastically accelerated the pace of our network partner acquisition. As a result, the number of POIs under the network partner model increased to 53% as of the end of 2022, and further increased to 73% as of the end of 2023.
By leveraging the scale and existing capabilities of our direct model, we have drastically accelerated the pace of our network partner acquisition.
The MIIT released the Circular on Regulating the Use of Domain Names in Internet Information Services on November 27, 2017, effective from January 1, 2018, which provides that the domain names used by the internet information service provider in providing internet information services shall be registered and owned by such internet information service provider, and if the internet information service provider is a legal entity, the domain name registrant shall be the legal entity (or any of its shareholders), or its principal or senior manager. 86 Table of Contents Regulations Relating to Online Trading and E-Commerce On August 31, 2018, the Standing Committee of the National People’s Congress, promulgated the E-Commerce Law of the People’s Republic of China, which became effective on January 1, 2019.
The PRC government may order ICP License holders that violate the content restrictions to correct those violations and revoke their ICP Licenses under serious conditions. 90 Table of Contents The MIIT released the Circular on Regulating the Use of Domain Names in Internet Information Services on November 27, 2017, effective from January 1, 2018, which provides that the domain names used by the internet information service provider in providing internet information services shall be registered and owned by such internet information service provider, and if the internet information service provider is a legal entity, the domain name registrant shall be the legal entity (or any of its shareholders), or its principal or senior manager.
Cabinets will lock all power banks and halt its lending functions if the temperature is above or below a certain limit.
Cabinets will lock all power banks and halt its lending functions if the temperature is above or below a certain limit. The latest generation of cabinets features enhanced waterproofing capabilities, rendering them more resilient for outdoor and extreme weather conditions.
We also have an apprentice system to better on-board our business development personnel. Each of the newcomers follows an experienced business development person for two weeks before they start operating on their own. Incentive.
Our training topics include management of location partner relationships, negotiation techniques, our latest know-how in business, and any other topics that may help improve the operational efficiency. We also have an apprentice system to better on-board our business development personnel. Each of the newcomers follows an experienced business development person for two weeks before they start operating on their own.
Because of our expansive operations, as of December 31, 2023, we had in circulation 9.2 million power banks. We have built a proprietary infrastructure to support the daily operation and management of our hardware, as standardized software cannot support our fast-changing business. Our hardware management system is connected to every power bank and cabinet.
We have built a proprietary infrastructure to support the daily operation and management of our hardware, as standardized software cannot support our fast-changing business. Our hardware management system is connected to every power bank and cabinet. When our cabinets are online, we are able to manage and analyze data collected through our cabinets.

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Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Our revenues generated under the direct model, which comprise of mobile device charging service fees of RMB1.1 billion and power bank sales of RMB24.7 million, decreased by 33.0% from RMB1.6 billion in 2022 to RMB1.1 billion in 2023. The decrease was primarily due to the decrease in number of POIs operated under the direct model.
Our revenues generated under the direct model, which comprise of mobile device charging service fees of RMB1.1 billion and power bank sales of RMB24.7 million in 2023, decreased by 33.0% from RMB1.6 billion in 2022 to RMB1.1 billion in 2023. The decrease was primarily due to the decrease in number of POIs operated under the direct model.
Our revenues generated under the network partner model, which comprise of mobile device charging service fees of RMB518.7 million, mobile device charging solution fees of RMB173.2 million and sales of cabinets and power banks of RMB1.1 billion, increased by 49.3% from RMB1.2 billion in 2022 to RMB1.8 billion in 2023.
Our revenues generated under the network partner model, which comprise of mobile device charging service fees of RMB518.7 million, mobile device charging solution fees of RMB173.2 million and sales of cabinets and power banks of RMB1.1 billion in 2023, increased by 49.3% from RMB1.2 billion in 2022 to RMB1.8 billion in 2023.
Critical Accounting Estimates We prepare our consolidated financial statements and related notes in accordance with GAAP. In doing so, we have to make estimates and assumptions that affect our reported amounts of assets, liabilities, revenue and expenses, as well as related disclosure of contingent assets and liabilities.
E. Critical Accounting Estimates We prepare our consolidated financial statements and related notes in accordance with GAAP. In doing so, we have to make estimates and assumptions that affect our reported amounts of assets, liabilities, revenue and expenses, as well as related disclosure of contingent assets and liabilities.
Risk Factors—Risks Relating to Doing Business in China—If we are classified as a PRC resident enterprise for PRC income tax purposes, such classification could result in unfavorable tax consequences to us and our non-PRC shareholders or ADS holders.” 110 Table of Contents Results of Operations The following table sets forth a summary of our consolidated results of operations for the periods indicated, both in absolute amount and as a percentage of our net revenues for the periods presented.
Risk Factors—Risks Relating to Doing Business in China—If we are classified as a PRC resident enterprise for PRC income tax purposes, such classification could result in unfavorable tax consequences to us and our non-PRC shareholders or ADS holders.” 114 Table of Contents Results of Operations The following table sets forth a summary of our consolidated results of operations for the periods indicated, both in absolute amount and as a percentage of our net revenues for the periods presented.
We generate substantially all of our revenues from our mobile device charging services. We offer users mobile device charging service generally at a rate of between RMB1 to RMB2 per thirty-minute interval. Users usually pay a refundable deposit of RMB99 upon receiving our power banks, and pay usage fees when they return the power banks.
We generate substantially most of our revenues from our mobile device charging services. We offer users mobile device charging service generally at a rate of between RMB1 to RMB2 per thirty-minute interval. Users usually pay a refundable deposit of RMB99 upon receiving our power banks, and pay usage fees when they return the power banks.
In the years of 2021, 2022 and 2023, our capital expenditures primarily incurred for purchasing raw materials and components from suppliers for the manufacturing of our power banks and cabinets, purchasing computer, electronic equipment, equipment for photovoltaic power stations and other production tools and software. We funded our capital expenditures primarily with net cash flows generated from operating activities.
In the years of 2022, 2023 and 2024, our capital expenditures primarily incurred for purchasing raw materials and components from suppliers for the manufacturing of our power banks and cabinets, purchasing computer, electronic equipment, equipment for photovoltaic power stations and other production tools and software. We funded our capital expenditures primarily with net cash flows generated from operating activities.
We regularly evaluate the effective interest rate against the actual lease repayments and prospectively adjust the effective interest rate as necessary. For the periods presented, there was no material change in the effective interest rate. For the years ended December 31, 2021, 2022 and 2023, the weighted average effective interest rate was 24%, 21% and 9%, respectively.
We regularly evaluate the effective interest rate against the actual lease repayments and prospectively adjust the effective interest rate as necessary. For the periods presented, there was no material change in the effective interest rate. For the years ended December 31, 2022 and 2023, the weighted average effective interest rate was 21%, and 9%, respectively.
The deposit is waived for users who have qualified credit scores at their digital wallet service providers, as assessed by these providers. We retain the deposit if the power banks are not returned after a certain period of time. We have two operating models for our mobile device charging services, direct model and network partner model.
The deposit is waived for users who have qualified credit scores at their digital wallet service providers, as assessed by these providers. We retain the deposit if the power banks are not returned after a certain period of time. 108 Table of Contents We have two operating models for our mobile device charging services, direct model and network partner model.
We do not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or research and development services with us. Holding Company Structure Our company is a holding company with no material operations of its own.
We do not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or research and development services with us. 121 Table of Contents Holding Company Structure Our company is a holding company with no material operations of its own.
See “Forward-Looking Information.” In evaluating our business, you should carefully consider the information provided under the caption “Item 3. Key Information—D. Risk Factors” in this annual report. We caution you that our businesses and financial performance are subject to substantial risks and uncertainties. A.
This report contains forward-looking statements. See “Forward-Looking Information.” In evaluating our business, you should carefully consider the information provided under the caption “Item 3. Key Information—D. Risk Factors” in this annual report. We caution you that our businesses and financial performance are subject to substantial risks and uncertainties. A.
The decrease from 2022 to 2023 was primarily attributable to the decreases in commissions paid to network partners as a result of the change in the contractual arrangement with network partners and the decrease in commissions paid to location partners.
The decrease from 2022 to 2024 was primarily attributable to the decreases in commissions paid to network partners as a result of the change in the contractual arrangement with network partners and the decrease in commissions paid to location partners.
We determine the fair value of restricted shares to our co-founders and RSUs of Smart Share Brothers Holding Limited and Smart Share CGY Holding Limited to our employees and external consultants based on the fair value of our ordinary shares on the date of grant. The binomial option-pricing model is used to measure the value of share options.
We determine the fair value of restricted shares to our co-founders and RSUs of Smart Share Brothers Holding Limited and Smart Share CGY Holding Limited to our employees and external consultants based on the fair value of our ordinary shares on the date of grant. 122 Table of Contents The binomial option-pricing model is used to measure the value of share options.
Item 5. Operating and Financial Review and Prospects The following discussion of our financial condition and results of operations is based upon, and should be read in conjunction with, our audited consolidated financial statements and the related notes included in this annual report. This report contains forward-looking statements.
Item 5. Operating and Financial Review and Prospects The following discussion of our financial condition and results of operations is based upon, and should be read in conjunction with, our audited consolidated financial statements and the related notes included in this annual report.
We cannot assure you that financing will be available in amounts or on terms acceptable to us, if at all. As of December 31, 2023, 99.5% of our cash, cash equivalents and restricted cash were denominated in Renminbi. As of December 31, 2023, an insignificant portion of cash and cash equivalents were held by the VIE.
We cannot assure you that financing will be available in amounts or on terms acceptable to us, if at all. As of December 31, 2024, 22.5% of our cash, cash equivalents and restricted cash were denominated in Renminbi. As of December 31, 2024, an insignificant portion of cash and cash equivalents were held by the VIE.
Trend Information Other than as disclosed elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for the period since January 1, 2024, that are reasonably likely to have a material and adverse effect on our net revenues, income, profitability, liquidity or capital resources, or that would cause the disclosed financial information to be not necessarily indicative of future results of operations or financial conditions. 117 Table of Contents E.
Trend Information Other than as disclosed elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for the period since January 1, 2025, that are reasonably likely to have a material and adverse effect on our net revenues, income, profitability, liquidity or capital resources, or that would cause the disclosed financial information to be not necessarily indicative of future results of operations or financial conditions.
Through our mini programs, users rent our power banks to carry with them when they use our service and can return the power banks at any of our POIs. As of December 31, 2023, we had a network of approximately 1,233,900 POIs covering more than 2,000 out of the approximate 2,850 counties and county-level districts in China.
Through our mini programs, users rent our power banks to carry with them when they use our service and can return the power banks at any of our POIs. As of December 31, 2024, we had a network of approximately 1,279,900 POIs covering more than 2,200 out of the approximate 2,850 counties and county-level districts in China.
In 2021, 2022 and 2023, the depreciation costs of our cabinets and power banks as percentages of revenues generated from the mobile device charging service for the respective periods were 9.1%, 12.6% and 12.5%, respectively.
In 2022, 2023 and 2024, the depreciation costs of our cabinets and power banks as percentages of revenues generated from the mobile device charging service for the respective periods were 12.6%, 12.5% and 32.9%, respectively.
Mobile device charging revenues, which consist of revenues generated under both direct model and network partner model, increased by 2.0% from RMB2.8 billion in 2022 to RMB2.9 billion (US$404.1 million) in 2023.
Mobile device charging revenues, which consist of revenues generated under both direct model and network partner model, increased by 2.0% from RMB2.8 billion in 2022 to RMB2.9 billion in 2023.
The increased scale of our POI and available-for-use power banks allows us to continue reaching more users, which in turn drive our mobile device charging orders, which increased by 18.7% from 552.8 million in 2022 to 656.4 million in 2023.
The increased scale of our POI and available-for-use power banks allows us to continue reaching more users, which in turn drive our mobile device charging orders, which increased by 18.7% from 552.8 million in 2022 to 656.4 million in 2023, and decreased by 12.6% to 574.0 million in 2024.
Investing activities Net cash used in investing activities in 2023 was RMB598.5 million (US$84.3 million), consisting of RMB7,277.1 million (US$1,025.0 million) used to purchase of short-term investments and RMB182.0 million (US$25.6 million) used to purchase of property, equipment and software from third parties, partially offset by RMB6,853.3 million (US$965.3 million) from proceeds from maturities of short-term investments.
Net cash used in investing activities in 2023 was RMB598.5 million, consisting of RMB7,277.1 million used to purchase of short-term investments and RMB182.0 million used to purchase of property, equipment and software from third parties, partially offset by RMB6,853.3 million from proceeds from maturities of short-term investments.
The entry fee rates for our direct model, calculated by dividing the entry fees paid to location partners in a given period by revenues from mobile device charging service revenue for the direct model operation, decreased from 18.7% in 2021 to 13.7% in 2022 and further to 6.1% in 2023.
The entry fee rates for our direct model, calculated by dividing the entry fees paid to location partners in a given period by revenues from mobile device charging service revenue for the direct model operation, decreased from 13.8% in 2022 to 6.7% in 2023 and increased to 18.7% in 2024.
Starting in the second quarter of 2023, we have updated our contractual arrangement with our network partners under the network partner model, shifting the principal role of providing mobile device charging services from us to network partners.
Starting in the second quarter of 2023, we have updated our contractual arrangement with our network partners under the network partner model, shifting the principal role of providing mobile device charging services from us to network partners. We have ceased to pay incentive fees to our network partners under the new arrangement.
As of December 31, 2021, 2022 and 2023, our available-for-use power banks were 5.7 million, 6.7 million and 9.2 million, respectively, representing a growth rate of 17.9% from 2021 to 2022 and 36.6% from 2022 to 2023.
As of December 31, 2022, 2023 and 2024, our available-for-use power banks were 6.7 million, 9.2 million and 9.6 million, respectively, representing a growth rate of 36.6% from 2022 to 2023 and 4.9% from 2023 to 2024.
The difference was primarily the result of: (i) adjustments for non-cash items that primarily include depreciation and amortization expense of RMB421.3 million amortization and impairment of prepayments to location partners and amortization of entry fees of RMB571.6 million; and 115 Table of Contents (ii) change in assets and liabilities mainly resulted from an increase in tax payables, other non-current liabilities as well as accounts payable and notes payable of RMB514.7 million, partially offset by an increase in other non-current assets of RMB127.2 million.
The difference was primarily the result of: (i) adjustments for non-cash items that primarily include depreciation and amortization expense of RMB421.3 million amortization and impairment of prepayments to location partners and amortization of entry fees of RMB574.0 million; and (ii) change in assets and liabilities mainly resulted from an increase in tax payables, other non-current liabilities as well as accounts payable and notes payable of RMB524.3 million, partially offset by an increase in other non-current assets of RMB127.2 million.
Net cash generated from operating activities in 2022 was RMB708.1 million, as compared to net loss of RMB711.2 million in the same period.
Net cash generated from operating activities in 2022 was RMB708.1 million, as compared to net loss of RMB730.8 million in the same period.
Research and development expenses Our research and development expenses remained relatively stable at RMB90.7 million in 2022 and RMB91.5 million (US$12.9 million) in 2023. Sales and marketing expenses Our sales and marketing expenses decreased by 44.4% from RMB2.7 billion in 2022 to RMB1.5 billion (US$212.3 million) in 2023.
Research and development expenses Our research and development expenses remained relatively stable at RMB90.7 million in 2022 and RMB91.5 million in 2023. Sales and marketing expenses Our sales and marketing expenses decreased by 44.5% from RMB2.7 billion in 2022 to RMB1.5 billion in 2023.
As of December 31, 2021, 2022 and 2023, our restricted cash and long-term restricted cash was RMB39.7 million, RMB35.6 million and RMB193.2 million (US$27.2 million), respectively. Our restricted cash mainly consists of deposits held in designated bank accounts for issuance of bank acceptance notes, letter of guarantee and those with legal restrictions.
As of December 31, 2022, 2023 and 2024, our restricted cash and long-term restricted cash was RMB35.6 million, RMB193.2 million and RMB112.3 million (US$15.4 million), respectively. Our restricted cash mainly consists of deposits held in designated bank accounts for issuance of bank acceptance notes, letter of guarantee and those with legal restrictions.
Instead, we started to (i) provide mobile device charging solutions to network partners, including software and system service, billing and settlement service, customer call center service and other services and (ii) sell cabinets and power banks to network partners. Our incentive fee rates in 2021, 2022 and 2023 were 61.1%, 75.1% and 55.9%, respectively.
Instead, we started to (i) provide mobile device charging solutions to network partners, including software and system service, billing and settlement service, customer call center service and other services and (ii) sell cabinets and power banks to network partners. Our incentive fee rates in 2022, 2023 and 2024 were 75.2%, 62.2% and 67.3%, respectively.
The difference was primarily the result of: (i) adjustments for non-cash items that primarily include depreciation and amortization expense of RMB257.6 million (US$36.3 million), and amortization and impairment of prepayments to location partners of RMB110.0 million (US$15.5 million) and (ii) change in assets and liabilities mainly resulted from an increase in accounts and notes receivable and prepayments and other current assets of RMB472.6 million (US$66.6 million), a decrease in inventory of RMB306.8 million (US$43.2 million) and a decrease in financial payables of RMB94.3 million (US$13.3 million), partially offset by an increase in salary and welfare payable and tax payable of RMB114.8 million (US$16.2 million).
The difference was primarily the result of: (i) adjustments for non-cash items that primarily include depreciation and amortization expense of RMB257.6 million, and amortization and impairment of prepayments to location partners of RMB112.5 million and (ii) change in assets and liabilities mainly resulted from an increase in accounts and notes receivable and prepayments and other current assets of RMB471.9 million and a decrease in financial payables of RMB94.3 million, partially offset by a decrease in inventory of RMB306.8 million and an increase in salary and welfare payable and tax payable of RMB111.6 million.
The amortization of these costs is included in expenses over the estimated life of the internal-use software. 118 Table of Contents Internal rate of return associated with the finance lease Under the former network partner model, we sell the cabinets to majority of network partners, but retain all the output derived from the cabinets, whose only potential use is to store, charge, and process our proprietary power banks, for an indefinite period.
Internal rate of return associated with the finance lease Under the former network partner model, we sell the cabinets to majority of network partners, but retain all the output derived from the cabinets, whose only potential use is to store, charge, and process our proprietary power banks, for an indefinite period.
Risk Factors—Risks Relating to Doing Business in China—PRC regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent us from using the proceeds of our securities offering to make loans or additional capital contributions to our PRC subsidiaries and the VIE, which could materially and adversely affect our liquidity and our ability to fund and expand our business.” Operating activities Net cash generated from operating activities in 2023 was RMB416.5 million (US$58.7 million), as compared to net income of RMB87.7 million (US$12.4 million) in the same period.
Risk Factors—Risks Relating to Doing Business in China—PRC regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent us from using the proceeds of our securities offering to make loans or additional capital contributions to our PRC subsidiaries and the VIE, which could materially and adversely affect our liquidity and our ability to fund and expand our business.” 119 Table of Contents Operating activities Net cash used in operating activities in 2024 was RMB205.7 million (US$28.2 million), as compared to net loss of RMB13.5 million (US$1.9 million) in the same period.
As of December 31, 2021, 2022 and 2023, our power banks were available in over 845,000 POIs, approximately 997,000 POIs and approximately 1,233,900 POIs, respectively, representing a growth rate of approximately 18.0% from 2021 to 2022 and approximately 23.8% from 2022 to 2023.
As of December 31, 2022, 2023 and 2024, our power banks were available in approximately 997,000 POIs, approximately 1,233,900 POIs and 1,279,900 POIs, respectively, representing a growth rate of approximately 23.8% from 2022 to 2023 and approximately 3.7% from 2023 to 2024.
As of December 31, 2021, 2022 and 2023, our short-term investments were RMB1,418.7 million, RMB2,091.2 million and RMB2,541.9 million (US$358.0 million), respectively.
As of December 31, 2022, 2023 and 2024, our short-term investments were RMB2,091.2 million, RMB2,541.9 million and RMB2,131.7 million (US$292.0 million), respectively.
Our operating lease obligations primarily consist of minimum payments under non-cancelable operating leases related to offices and warehouses. Our purchase obligations primarily include our commitment to purchase power banks and cabinets.
Our operating lease obligations primarily consist of minimum payments under non-cancelable operating leases related to offices and warehouses. Our purchase obligations primarily include our commitment to purchase power banks and cabinets for mobile divice charging business, and to purchase equipment for photovoltaic power stations .
As a contributor to the overall incentive fee rate, our overall commission rate, calculated by dividing the commissions paid to location partners and, under the former network partner model, to network partners, in a given period by revenues from mobile device charging service in the same period, to location partners and network partners increased from 47.8% in 2021 to 67.2% in 2022, and decreased to 58.1% in 2023.
As a contributor to the overall incentive fee rate, our overall commission rate, calculated by dividing the commissions paid to location partners and, under the former network partner model, to network partners, in a given period by revenues from mobile device charging service in the same period, to location partners and network partners decreased from 67.3% in 2022 to 57.6% in 2023 and further decreased to 48.6% in 2024.
The decrease in our incentive fee rates from 2022 to 2023 is mainly due to the cessation of provision of incentive fees to our network partners under the new contractual arrangement, under which we have recorded revenue derived from the provision of mobile device charging solution starting in the second quarter of 2023, and the general recovery in offline traffic in China resulting in a recovery in revenues. 105 Table of Contents In particular, under the direct model, incentive fees to location partners decreased from RMB1,529.3 million in 2021 to RMB1,132.3 million in 2022 and decreased further to RMB585.6 million in 2023.
The decrease in our incentive fee rates from 2022 to 2023 is mainly due to the cessation of provision of incentive fees to our network partners under the new contractual arrangement, under which we have recorded revenue derived from the provision of mobile device charging solution starting in the second quarter of 2023, and the general recovery in offline traffic in China resulting in a recovery in revenues.
Judgment is required in determining when we enter the application development stage. We have determined that the application development stage for our software products is reached after the project research, plan and design are completed.
Judgment is required in determining when we enter the application development stage. We have determined that the application development stage for our software products is reached after the project research, plan and design are completed. The amortization of these costs is included in expenses over the estimated life of the internal-use software.
Financing activities Net cash used in financing activities in 2023 was RMB28.0 million (US$3.9 million), consisting primarily of RMB14.5 million (US$2.0 million) of repayment of financing to network partners, and RMB13.7 million (US$1.9 million) of repurchasing of Class A ordinary shares.
Financing activities Net cash used in financing activities in 2024 was RMB99.2 million (US$13.6 million), consisting primarily of RMB54.9 million (US$7.7 million) of cash dividends payment, and RMB44.4 million (US$6.1 million) of repurchasing of Class A ordinary shares. 120 Table of Contents Net cash used in financing activities in 2023 was RMB28.0 million, consisting primarily of RMB14.5 million of repayment of financing to network partners, and RMB13.7 million of repurchasing of Class A ordinary shares.
Mainland China Generally, our PRC subsidiaries and the VIE are subject to the PRC Enterprise Income Tax Law at the statutory income tax rate of 25%. 109 Table of Contents In accordance with the Enterprise Income Tax Law, foreign invested enterprises and domestic companies are subject to enterprise income tax at a uniform rate of 25%.
In accordance with the Enterprise Income Tax Law, foreign invested enterprises and domestic companies are subject to enterprise income tax at a uniform rate of 25%. Our subsidiaries and the VIE in the PRC are subject to a uniform income tax rate of 25% for all periods presented.
The following table sets forth our contractual obligations as of December 31, 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Within one One to three Three to five More than five ​ Total year years years years ​ ​ (RMB in thousands) Operating lease obligations 31,105 21,049 3,996 888 5,172 Purchase of equipment and inventory 246,273 246,273 — — — ​ Other than as shown above, we did not have any significant capital and other commitments, long-term obligations or guarantees as of December 31, 2023.
The following table sets forth our contractual obligations as of December 31, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Within one One to three Three to five More than five ​ Total year years years years ​ ​ (RMB in thousands) Operating lease obligations 8,650 ​ 1,218 ​ 1,839 ​ 888 ​ 4,705 Purchase of equipment and inventory 185,892 ​ 185,892 ​ — ​ — ​ — ​ Other than as shown above, we did not have any significant capital and other commitments, long-term obligations or guarantees as of December 31, 2024.
Recent Accounting Pronouncements A list of recently issued accounting pronouncements that are relevant to us is included in note 2 “Summary of Principal Accounting Policies — (ah) Recent Accounting Pronouncements” of our consolidated financial statements included elsewhere in this annual report.
Additionally, external data and macroeconomic factors are also considered. 123 Table of Contents Recent Accounting Pronouncements A list of recently issued accounting pronouncements that are relevant to us is included in Note 2 “Summary of Principal Accounting Policies—(ag) Recent Accounting Pronouncements” of our consolidated financial statements included elsewhere in this annual report.
Other sources of revenues mainly include new initiatives and advertising services that we provide to our customers by displaying customers’ images and brand on our power banks or our mini programs as well as sales of merchandises.
We also reclassified the comparative period presentation to conform to current period classification. 111 Table of Contents Other sources of revenues mainly include sales of merchandise and advertising services that we provide to our customers by displaying customers’ images and brand on our power banks or our mini programs as well as sales of merchandises.
The significant decrease in operating loss was primarily due to the general recovery in offline foot traffic in China during 2023, resulting in revenues similar to pre-pandemic levels. Income tax expense We incurred income tax expense of RMB114.5 million in 2022 and RMB21.0 million (US$3.0 million) in 2023.
Loss from operations As a result of the foregoing, we incurred loss from operations of RMB644.6 million in 2022, and income from operations of RMB0.5 million in 2023. The significant decrease in operating loss was primarily due to the general recovery in offline foot traffic in China during 2023, resulting in revenues similar to pre-pandemic levels.
The effective tax rate of 19% in 2022 and 2023 was different than the statutory income tax rate of 25% primarily due to the change in reserves for uncertain tax positions. Net income/(loss) As a result of the foregoing, our net income was RMB87.7 million (US$12.4 million) in 2023, compared to a net loss of RMB711.2 million in 2022.
The effective tax rate was different than the statutory income tax rate of 25% primarily due to the change in reserves for uncertain tax positions and valuation allowance of deferred tax assets. Net income/(loss) As a result of the foregoing, our net loss was RMB13.5 million (US$1.9 million) in 2024, compared to a net income of RMB88.7 million in 2023.
We will continue to make well-planned capital expenditures to meet the expected growth of our business. 116 Table of Contents Our material cash requirements as of December 31, 2023, and any subsequent interim period primarily include our operating lease obligations and purchase obligations.
We intend to fund our future capital expenditures with our existing cash balance, short-term investments and anticipated cash flows from operations. We will continue to make well-planned capital expenditures to meet the expected growth of our business. Our material cash requirements as of December 31, 2024, and any subsequent interim period primarily include our operating lease obligations and purchase obligations.
The ownership rights of cabinets and power banks under the network partner model, which were previously held by us, have also been transferred to the network partners under the new arrangement.
Starting in the second quarter of 2023, we have shifted the principal role of providing mobile device charging services from us to network partners. The ownership rights of cabinets and power banks under the network partner model, which were previously held by us, have also been transferred to the network partners under the new arrangement.
Net cash generated from operating activities in 2021 was RMB226.8 million, as compared to net income of RMB536.1 million in the same period.
Net cash generated from operating activities in 2023 was RMB416.5 million, as compared to net income of RMB88.7 million in the same period.
Net cash used in financing activities in 2022 was RMB78.5 million, consisting primarily of RMB60.5 million of repayment to financing from network partners, and RMB19.7 million of repurchasing of Class A ordinary shares.
Net cash used in financing activities in 2022 was RMB78.5 million, consisting primarily of RMB60.5 million of repayment to financing from network partners, and RMB19.7 million of repurchasing of Class A ordinary shares. Material Cash Requirements We made capital expenditures of RMB442.9 million in 2022, RMB182.0 million in 2023 and RMB9.4 million (US$1.3 million) in 2024.
Incentive fees to location partners as percentages of revenues generated by our devices placed at their venues generally range between 50% and 70% during periods without significant COVID-19 outbreaks. Under the network partner model, we historically pay network partners incentive fees based on a percentage of the revenues generated by cabinets that they placed.
For certain location partners, we also pay entry fees, based on our projected revenues of the POIs, in order to secure our collaboration with them. Incentive fees to location partners as percentages of revenues generated by our devices placed at their venues generally range between 50% and 70% during periods without significant COVID-19 outbreaks.
Liquidity and Capital Resources Cash Flows and Working Capital The following table sets forth a summary of our cash flows for the periods presented: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2021 ​ 2022 ​ 2023 ​ RMB RMB RMB US$ ​ ​ (in thousands) Net cash generated from operating activities ​ 226,778 ​ 708,142 ​ 416,499 ​ 58,663 Net cash used in investing activities (1,714,287) (1,023,997) (598,535) (84,302) Net cash generated from/(used in) financing activities 1,563,397 (78,454) (27,956) (3,938) Effect of exchange rate changes on cash and cash equivalents and restricted cash (42,794) 42,095 7,501 1,057 Net increase/(decrease) in cash, cash equivalents and restricted cash 33,094 (352,214) (202,491) (28,520) Cash, cash equivalents and restricted cash at the beginning of the year 1,303,501 1,336,595 984,381 138,647 Cash, cash equivalents and restricted cash at the end of the year 1,336,595 984,381 781,890 110,127 ​ We have financed our operating and investing activities mainly through cash generated from operating activities, financing activities and our initial public offering in 2021. 114 Table of Contents As of December 31, 2021, 2022 and 2023, our cash and cash equivalents were RMB1,296.9 million, RMB948.8 million and RMB588.6 million (US$82.9 million), respectively.
Liquidity and Capital Resources Cash Flows and Working Capital The following table sets forth a summary of our cash flows for the periods presented: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2022 ​ 2023 ​ 2024 ​ RMB RMB RMB US$ ​ ​ (in thousands) Net cash generated from/(used in) operating activities ​ 708,142 ​ 416,499 ​ (205,669) ​ (28,177) Net cash (used in)/generated from investing activities (1,023,997) ​ (598,535) ​ 419,581 ​ 57,482 Net cash used in financing activities (78,454) ​ (27,956) ​ (99,204) ​ (13,591) Effect of exchange rate changes on cash and cash equivalents and restricted cash 42,095 ​ 7,501 ​ 3,108 ​ 427 Net (decrease)/increase in cash, cash equivalents and restricted cash (352,214) ​ (202,491) ​ 117,816 ​ 16,141 Cash, cash equivalents and restricted cash at the beginning of the year 1,336,595 ​ 984,381 ​ 781,890 ​ 107,118 Cash, cash equivalents and restricted cash at the end of the year 984,381 ​ 781,890 ​ 899,706 ​ 123,259 ​ We have financed our operating and investing activities mainly through cash generated from operating activities, financing activities and our initial public offering in 2021.
The following table sets forth the components of our incentive fees paid to location partners and, under the former network partner model, to network partners by amounts and percentages of our total incentive fees paid to location partners and network partners for the periods presented: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2021 ​ 2022 ​ 2023 ​ RMB % RMB % RMB US$ % ​ ​ (in thousands, except for percentages) Incentive fees paid to location partners and network partners ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Entry fees ​ 459,737 ​ 21.8 ​ 217,819 ​ 10.5 ​ 64,863 ​ 9,136 ​ 6.6 Commissions ​ 1,653,037 ​ 78.2 ​ 1,851,283 ​ 89.5 ​ 916,426 ​ 129,076 ​ 93.4 Total ​ 2,112,774 ​ 100.0 ​ 2,069,102 ​ 100.0 ​ 981,289 ​ 138,212 ​ 100.0 ​ We believe that our network effect and leading position in the number of POIs covered contributes to our ability to effectively negotiate with location partners, and our ability to control raw material and manufacturing costs enhances our ability to offer attractive incentive fee rates.
The following table sets forth the components of our incentive fees paid to location partners and, under the former network partner model, to network partners by amounts and percentages of our total incentive fees paid to location partners and network partners for the periods presented: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2022 ​ 2023 ​ 2024 ​ RMB % RMB % RMB US$ % ​ ​ (in thousands, except for percentages) Incentive fees paid to location partners and network partners ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Entry fees ​ 218,909 ​ 10.6 ​ 71,376 ​ 7.3 ​ 66,037 ​ 9,047 ​ 27.8 Commissions ​ 1,852,995 ​ 89.4 ​ 909,081 ​ 92.7 ​ 171,450 ​ 23,489 ​ 72.2 Total ​ 2,071,904 ​ 100 ​ 980,457 ​ 100 ​ 237,487 ​ 32,536 ​ 100 ​ 110 Table of Contents We believe that our network effect and leading position in the number of POIs covered contributes to our ability to effectively negotiate with location partners, and our ability to control raw material and manufacturing costs enhances our ability to offer attractive incentive fee rates.
The following table sets forth the components of our revenues by amounts and percentages of our total revenues for the periods presented: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2021 ​ 2022 ​ 2023 ​ RMB % RMB % RMB US$ % ​ ​ (in thousands, except for percentages) Revenues Mobile device charging ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Mobile device charging service ​ 3,455,797 ​ 96.4 ​ 2,754,143 ​ 97.0 ​ 1,577,379 ​ 222,169 ​ 53.3 Direct model ​ 2,458,794 ​ 68.6 ​ 1,587,298 ​ 55.9 ​ 1,058,636 ​ 149,105 ​ 35.8 Network partner model ​ 997,003 ​ 27.8 ​ 1,166,845 ​ 41.1 ​ 518,743 ​ 73,063 ​ 17.5 Power bank and cabinet sales ​ 102,857 2.9 59,476 2.1 1,118,684 157,563 37.8 Direct model ​ 73,183 ​ 2.0 ​ 30,495 ​ 1.1 ​ 24,664 ​ 3,473 ​ 0.8 Network partner model ​ 29,674 ​ 0.8 ​ 28,981 ​ 1.0 ​ 1,094,020 ​ 154,089 ​ 37.0 Mobile device charging solution ​ — ​ — ​ — ​ — ​ 173,152 ​ 24,388 ​ 5.9 Others ​ 26,737 0.7 24,571 0.9 89,432 12,596 3.0 Total revenues ​ 3,585,391 100.0 2,838,190 100.0 2,958,647 416,716 100.0 ​ The following table represents the mapping of revenue as reported under and before the new reclassification for the years ended December 31, 2021 and 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As reported under new classification ​ As reported before reclassification ​ ​ Year ended December 31,2021 ​ Year ended December 31, 2022 ​ ​ ​ Year ended December 31, 2021 ​ Year ended December 31, 2022 ​ RMB RMB ​ RMB RMB (in thousands) Mobile device charging Mobile device charging service 3,455,797 2,754,143 Mobile device charging business 3,455,797 2,754,143 Direct model 2,458,794 1,587,298 Network partner model 997,003 1,166,845 Power bank and cabinet sales 102,857 59,476 Power bank sales 102,857 59,476 Direct model 73,183 30,495 ​ ​ ​ Network partner model 29,674 28,981 Mobile device charging solution — — Mobile device charging ​ 3,558,654 ​ 2,813,619 ​ ​ ​ ​ ​ ​ Others 26,737 24,571 Others 26,737 24,571 Total 3,585,391 2,838,190 Total 3,585,391 2,838,190 ​ 107 Table of Contents Cost of revenues Our cost of revenues primarily consists of depreciation of power banks and cabinets, cost of power banks sold or lost, cost of cabinets sold, cost of photovoltaic power stations sold, depreciation of photovoltaic power stations and other expenses directly attributable to our operations.
The following table sets forth the components of our revenues by amounts and percentages of our total revenues for the periods presented: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2022 ​ 2023 ​ 2024 ​ RMB % RMB % RMB US$ % ​ ​ (in thousands, except for percentages) Revenues Mobile device charging ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Mobile device charging service ​ 2,754,143 ​ 97.0 ​ 1,577,379 ​ 53.3 ​ 353,097 ​ 48,374 ​ 18.6 Direct model ​ 1,587,298 ​ 55.9 ​ 1,058,636 ​ 35.8 ​ 353,097 ​ 48,374 ​ 18.6 Network partner model ​ 1,166,845 ​ 41.1 ​ 518,743 ​ 17.5 ​ — ​ — ​ — Power bank and cabinet sales ​ 59,476 ​ 2.1 ​ 1,118,684 ​ 37.8 ​ 781,756 ​ 107,100 ​ 41.3 Direct model ​ 30,495 ​ 1.1 ​ 24,664 ​ 0.8 ​ 6,615 ​ 906 ​ 0.3 Network partner model ​ 28,981 ​ 1.0 ​ 1,094,020 ​ 37.0 ​ 775,141 ​ 106,194 ​ 41.0 Mobile device charging solution ​ — ​ — ​ 173,152 ​ 5.9 ​ 249,842 ​ 34,228 ​ 13.2 Photovoltaic business ​ — ​ — ​ 50,995 ​ 1.7 ​ 479,850 ​ 65,739 ​ 25.3 Others ​ 24,571 ​ 0.9 ​ 38,437 ​ 1.3 ​ 29,875 ​ 4,093 ​ 1.6 Total revenues ​ 2,838,190 ​ 100 ​ 2,958,647 ​ 100 ​ 1,894,420 ​ 259,534 ​ 100 ​ Cost of revenues Our cost of revenues primarily consists of depreciation of power banks and cabinets, cost of power banks sold or lost, cost of cabinets sold, cost of photovoltaic power stations sold, depreciation of photovoltaic power stations and other expenses directly attributable to our operations.
Our net income in 2023 was RMB87.7 million (US$12.4 million). 104 Table of Contents Major Factors Affecting Our Results of Operations Our industry and our operations are significantly influenced by general economic conditions in China. The mobile device charging service only pertains to public areas for business or leisure.
Major Factors Affecting Our Results of Operations Our industry and our operations are significantly influenced by general economic conditions in China. The mobile device charging service only pertains to public areas for business or leisure. The more people stay at home or offices, the less likely they will need our services.
Commission fees are calculated based on percentages of the revenues generated by the cabinets placed at their POIs. For certain location partners, we also pay entry fees, based on our projected revenues of the POIs, in order to secure our collaboration with them.
Under the direct model, we also pay location partners incentive fees, which comprises commission fees and entry fees. Commission fees are calculated based on percentages of the revenues generated by the cabinets placed at their POIs.
The difference was primarily the result of: (a) adjustments for non-cash items that primarily include depreciation and amortization expense of RMB396.9 million as well as amortization of entry fees and prepayments to location partners of RMB626.1 million; and (b) change in assets and liabilities mainly resulted from an increase in prepayments and other current and non-current assets of RMB828.4 million, partially offset by an increase in accounts and notes payable of RMB45.4 million.
The difference was primarily the result of: (i) adjustments for non-cash items that primarily include depreciation and amortization expense of RMB151.3 million (US$20.7 million), amortization of entry fees of RMB66.0 million(US$9.0 million), amortization and impairment of prepayments to location partners of RMB49.1 million (US$6.7 million) and allowance for credit losses of RMB45.7 million (US$6.3 million) and (ii) change in assets and liabilities mainly resulted from an increase in accounts and notes receivable and contract assets of RMB317.8 million (US$43.5 million), a decrease in accounts and notes payable of RMB227.3 million (US$31.1 million), a decrease in accruals and other current liabilities of RMB29.6 million (US$4.1 million) and a decrease in tax payable of RMB23.1 million (US$3.2 million), partially offset by a decrease in prepayments and other current assets of RMB18.3 million (US$2.5 million) and an increase of other non-current liabilities of RMB25.0 million (US$3.4 million).
Sales and marketing expenses Our sales and marketing expenses comprise a significant portion of our operating expenses, consisting primarily of incentive fees paid to location partners, compensation for business development personnel and other expenses related to sales and marketing functions.
Sales and marketing expenses Our sales and marketing expenses comprise a significant portion of our operating expenses, consisting primarily of incentive fees paid to location partners, compensation for business development personnel and other expenses related to sales and marketing functions. 112 Table of Contents Under the direct model, business development personnel compensation is calculated based on our carefully designed evaluation matrix, which helps align business development personnel’s interest with ours.
Technological advancements that improve battery capacity, power conservation, energy efficiency or charging speed, or otherwise lessen consumers’ need for mobile device charging, may decrease consumer demand for power banks. Developments in the power bank technologies which make them more affordable to own and easier to carry around may also affect our industry negatively.
Our industry is generally affected by the popularity and the prevalence of smart mobile devices. The development of battery technologies also influences our industry. Technological advancements that improve battery capacity, power conservation, energy efficiency or charging speed, or otherwise lessen consumers’ need for mobile device charging, may decrease consumer demand for power banks.
The decrease from 2022 to 2023 was primarily due to the decrease in the number of POIs under the direct model.
The decreases from 2022 to 2023 and from 2023 to 2024 were primarily due to the decrease in the number of POIs under the direct model in connection with our strategic shift towards network partner model.
We have ceased to pay incentive fees to our network partners under the new arrangement. 108 Table of Contents The following table sets forth the components of our sales and marketing expenses by amounts and percentages of our total sales and marketing expenses for the periods presented: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2021 ​ 2022 ​ 2023 ​ RMB % RMB % RMB US$ % ​ ​ (in thousands, except for percentages) Sales and marketing expenses Incentive fees to location partners and network partners 2,112,774 71.6 2,069,102 76.3 981,289 138,212 65.1 Compensation for business development personnel 604,822 20.5 503,572 18.6 408,739 57,570 27.1 Others 233,376 7.9 139,656 5.1 117,404 16,535 7.8 Total 2,950,972 100.0 2,712,330 100.0 1,507,432 212,317 100.0 ​ General and administrative expenses Our general and administrative expenses primarily include compensation for corporate employees and other expenses related to the general corporate functions.
The following table sets forth the components of our sales and marketing expenses by amounts and percentages of our total sales and marketing expenses for the periods presented: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2022 ​ 2023 ​ 2024 ​ RMB % RMB % RMB US$ % ​ ​ (in thousands, except for percentages) Sales and marketing expenses Incentive fees to location partners and network partners 2,071,904 76.3 980,457 65.1 237,487 32,536 38.1 Compensation for business development personnel 503,572 18.5 408,739 27.1 292,524 40,075 46.9 Others 139,656 5.2 117,404 7.8 93,856 12,858 15.0 Total 2,715,132 100 1,506,600 100 623,867 85,469 100 ​ General and administrative expenses Our general and administrative expenses primarily include compensation for corporate employees, expected credit loss expense and other expenses related to the general corporate functions.
Our ability to efficiently control our overall incentive fees while expanding our POI coverage Our ability to control our overall incentive fees paid to location partners and, under the former network partner model, to network partners is imperative to maintaining healthy financial margins.
As of December 31, 2022, 2023 and 2024, our services were available in approximately 1,800, 2,000 and 2,200 out of the approximate 2,850 counties and county-level districts in China. 109 Table of Contents Our ability to efficiently control our overall incentive fees while expanding our POI coverage Our ability to control our overall incentive fees paid to location partners and, under the former network partner model, to network partners is imperative to maintaining healthy financial margins.
Other revenues, which primarily comprise of revenue from new business initiatives and advertising services, increase by 264.0% from RMB24.6 million in 2022 to RMB89.4 million (US$12.6 million) in 2023. The increase was primarily attributable to certain new business initiatives and the increase in user numbers and advertisement efficiency.
The increase was primarily attributable to certain new business initiatives and the increase in user numbers and advertisement efficiency. 117 Table of Contents Cost of revenues Our cost of revenues increased by 110.4% from RMB573.2 million in 2022 to RMB1.2 billion in 2023.
The effective tax rate of nil in 2021 was lower than the statutory income tax rate of 25% primarily because of unrealizable net operating loss incurred. The effective tax rate of (19%) in 2022 was lower than the statutory income tax rate of 25% primarily due to the change in reserves for uncertain tax positions.
Income tax expense We incurred income tax expense of RMB110.6 million in 2022 and RMB21.5 million in 2023. The effective tax rate of -18% in 2022 and 20% in 2023 was different than the statutory income tax rate of 25% primarily due to the change in reserves for uncertain tax positions.
Historically, we primarily derived our revenues from our mobile device charging service, which consist of revenues generated under both the direct model and the network partner model. Starting in the second quarter of 2023, we have shifted the principal role of providing mobile device charging services from us to network partners.
Key Components of Results of Operations Revenues Our revenues are recorded net of value-added tax. Historically, we primarily derived our revenues from our mobile device charging service, which consist of revenues generated under both the direct model and the network partner model.
Our total revenue decreased from RMB3,585.4 million in 2021 to RMB2,838.2 million in 2022, and increased to RMB2,958.6 million (US$416.7 million) in 2023. Our net loss increased from RMB124.6 million in 2021 to RMB711.2 million in 2022.
Our total revenue increased from RMB2,838.2 million in 2022 to RMB2,958.6 million in 2023 and decreased to RMB1,894.4 million (US$259.5 million) in 2024. We had incurred a net loss of RMB730.8 million in 2022, a net income of RMB88.7 million in 2023, and a net loss of RMB13.5 million (US$1.9 million) in 2024.
The following table sets forth the components of our cost of revenues by amounts and percentages of our total revenues for the periods presented: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2021 ​ 2022 ​ 2023 ​ RMB % RMB % RMB US$ % ​ ​ (in thousands, except for percentages) Cost of revenues Depreciation 313,196 8.7 346,319 12.2 196,266 27,643 6.6 Cost of cabinets and power banks sold (1) 108,280 3.0 83,251 2.9 843,203 118,763 28.5 Others 135,701 3.8 127,353 4.5 169,995 23,943 5.8 Total 557,177 15.5 556,923 19.6 1,209,464 170,349 40.9 Note: (1) Including cost of power banks sold and written-off of power banks kept by users who forfeit their deposits.
The following table sets forth the components of our cost of revenues by amounts and percentages of our total revenues for the periods presented: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2022 ​ 2023 ​ 2024 ​ RMB % RMB % RMB US$ % ​ ​ (in thousands, except for percentages) Cost of revenues Depreciation 346,319 ​ 12.2 ​ 195,743 ​ 6.6 ​ 116,283 ​ 15,930 ​ 6.1 Cost of cabinets and power banks sold (1) ​ 83,251 ​ 2.9 ​ 843,203 ​ 28.5 ​ 430,839 ​ 59,025 ​ 22.7 Cost of Photovoltaic power stations sold ​ — ​ — ​ 45,366 ​ 1.5 ​ 409,768 ​ 56,138 ​ 21.6 Depreciation of Photovoltaic power stations — ​ — ​ 523 ​ 0.0 ​ 1,160 ​ 159 ​ 0.1 Others 143,665 ​ 5.1 ​ 121,356 ​ 4.2 ​ 132,737 ​ 18,185 ​ 7.0 Total 573,235 ​ 20.2 ​ 1,206,191 ​ 40.8 ​ 1,090,787 ​ 149,437 ​ 57.5 Note: (1) Including cost of power banks sold and written-off of power banks kept by users who forfeit their deposits.
The decrease from 2021 to 2022 and the further decrease from 2022 to 2023 was primarily attributable to the decreased use of fixed entry fees for new signings.
The decrease from 2022 to 2023 was primarily attributable to the decreased use of fixed entry fees for new signings. The increase from 2023 to 2024 was primarily attributable to the general decrease in the revenue efficiency of our power banks due to the challenges in the consumption environment and general competition within the mobile device charging service industry.
Year Ended December 31, 2022 Compared to Year Ended December 31, 2021 Revenues Our revenues decreased by 20.8% from RMB3,585.4 million in 2021 to RMB2,838.2 million in 2022. This decrease was primarily driven by the decrease in revenues from our mobile device charging business.
Year Ended December 31, 2023 Compared to Year Ended December 31, 2022 Revenues Our revenues increased by 4.2% from RMB2,838.2 million in 2022 to RMB2,958.6 million in 2023.
There is an anti-fragmentation measure where each group will have to nominate only one company in the group to benefit from the progressive rates. No provision for Hong Kong S.A.R. profits tax has been made in the financial statements as the subsidiary in Hong Kong S.A.R. have no assessable profits for the years ended December 31, 2021, 2022 and 2023.
There is an anti-fragmentation measure where each group will have to nominate only one company in the group to benefit from the progressive rates.
The depreciation costs of our cabinets and power banks as percentages of revenues generated from the mobile device charging service were relatively stable for 2022 and 2023. 106 Table of Contents Key Components of Results of Operations Revenues Our revenues are recorded net of value-added tax.
The depreciation costs of our cabinets and power banks as percentages of revenues generated from the mobile device charging service were relatively stable for 2022 and 2023. The increase from 2023 to 2024 was primarily due to efficiency loss in our overall strategy of shifting towards the network partner model.
The operating results in any period are not necessarily indicative of the results that may be expected for any future period. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2021 ​ 2022 ​ 2023 ​ RMB % RMB % RMB US$ % ​ ​ (in thousands, except for percentages) Revenues Mobile device charging service ​ 3,455,797 96.4 2,754,143 97.0 1,577,379 222,169 53.3 Mobile device charging solution ​ — ​ — ​ — ​ — ​ 173,152 ​ 24,388 ​ 5.9 Power bank and cabinet sales ​ 102,857 ​ 2.9 ​ 59,476 ​ 2.1 ​ 1,118,684 ​ 157,563 ​ 37.8 Mobile device charging ​ 3,558,654 99.3 2,813,619 99.1 2,869,215 404,120 97.0 Others ​ 26,737 0.7 24,571 0.9 89,432 12,596 3.0 Total revenues ​ 3,585,391 100.0 2,838,190 100.0 2,958,647 416,716 100.0 Cost of revenues (1) (557,177) (15.5) (556,923) (19.6) (1,209,464) (170,349) (40.9) Research and development expenses (1) (93,882) (2.6) (90,656) (3.2) (91,461) (12,882) (3.1) Sales and marketing expenses (1) (2,950,972) (82.3) (2,712,330) (95.6) (1,507,432) (212,317) (51.0) General and administrative expenses (1) (118,973) (3.3) (112,403) (4.0) (125,528) (17,680) (4.2) Other operating income/(loss) 26,614 0.7 12,876 0.5 (25,827) (3,638) (0.9) Loss from operations (108,999) (3.0) (621,245) (21.9) (1,065) (150) (0.0) Interest and investment income 30,560 0.9 52,389 1.8 117,247 16,514 4.0 Interest expense to third parties (38,051) (1.1) (31,282) (1.1) (4,228) (596) (0.1) Foreign exchange (losses)/gains, net (7,935) (0.2) 3,787 0.1 (3,255) (458) (0.1) Other (expenses)/income, net (190) (0.0) (413) (0.0) 63 9 0.0 (Loss)/income before income tax expense ​ (124,615) (3.4) (596,764) (21.0) 108,762 15,319 3.7 Income tax expense — — (114,476) (4.0) (21,021) (2,961) (0.7) Net (loss)/income ​ (124,615) (3.4) (711,240) (25.1) 87,741 12,358 3.0 Note: (1) Share-based compensation expenses were allocated as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2021 ​ 2022 ​ 2023 ​ RMB RMB RMB US$ ​ ​ (in thousands) Share-based compensation expenses: General and administrative expenses 23,688 21,383 15,757 2,219 Research and development expenses 1,462 1,679 1,141 161 Sales and marketing expenses 5,252 4,983 3,328 469 Cost of revenues 271 200 113 16 Total 30,673 28,245 20,339 2,865 ​ ​ 111 Table of Contents Year Ended December 31, 2023 Compared to Year Ended December 31, 2022 Revenues Our revenues increased by 4.2% from RMB2,838.2 million in 2022 to RMB2,958.6 million (US$416.7 million) in 2023.
The operating results in any period are not necessarily indicative of the results that may be expected for any future period. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2022 ​ 2023 ​ 2024 ​ RMB % RMB % RMB US$ % ​ ​ (in thousands, except for percentages) Revenues Mobile device charging service ​ 2,754,143 ​ 97.0 ​ 1,577,379 ​ 53.3 ​ 353,097 ​ 48,374 ​ 18.6 Mobile device charging solution ​ — ​ — ​ 173,152 ​ 5.9 ​ 249,842 ​ 34,228 ​ 13.2 Power bank and cabinet sales ​ 59,476 ​ 2.1 ​ 1,118,684 ​ 37.8 ​ 781,756 ​ 107,100 ​ 41.3 Mobile device charging ​ 2,813,619 ​ 99.1 ​ 2,869,215 ​ 97.0 ​ 1,384,695 ​ 189,702 ​ 73.1 Photovoltaic business ​ — ​ — ​ 50,995 ​ 1.7 ​ 479,850 ​ 65,739 ​ 25.3 Others ​ 24,571 ​ 0.9 ​ 38,437 ​ 1.3 ​ 29,875 ​ 4,093 ​ 1.6 Total revenues ​ 2,838,190 ​ 100.0 ​ 2,958,647 ​ 100.0 ​ 1,894,420 ​ 259,534 ​ 100.0 Cost of mobile device charging (559,706) ​ (19.7) ​ (1,151,190) ​ (38.9) ​ (663,188) ​ (90,857) ​ (35.0) Cost of photovoltaic business ​ — ​ — ​ (51,928) ​ (1.8) ​ (424,326) ​ (58,132) ​ (22.4) Other costs ​ (13,529) ​ (0.5) ​ (3,073) ​ (0.1) ​ (3,273) ​ (448) ​ (0.2) Total cost of revenues (1) ​ (573,235) ​ (20.2) ​ (1,206,191) ​ (40.8) ​ (1,090,787) ​ (149,437) ​ (57.6) Gross profit ​ 2,264,955 ​ 79.8 ​ 1,752,456 ​ 59.2 ​ 803,633 ​ 110,097 ​ 42.4 Research and development expenses (1) (90,655) ​ (3.2) ​ (91,461) ​ (3.1) ​ (82,882) ​ (11,355) ​ (4.4) Sales and marketing expenses (1) (2,715,132) ​ (95.7) ​ (1,506,600) ​ (50.9) ​ (623,867) ​ (85,469) ​ (32.9) General and administrative expenses (1) (113,771) ​ (4.0) ​ (128,036) ​ (4.3) ​ (150,196) ​ (20,577) ​ (8.0) Other operating income/(loss) 9,972 ​ 0.4 ​ (25,908) ​ (0.9) ​ (17,856) ​ (2,446) ​ (0.9) Loss from operations (644,631) ​ (22.7) ​ 451 ​ 0.0 ​ (71,168) ​ (9,750) ​ (3.8) Interest and investment income 52,389 ​ 1.8 ​ 117,247 ​ 3.9 ​ 112,976 ​ 15,478 ​ 6.0 Interest expense to third parties (31,282) ​ (1.1) ​ (4,228) ​ (0.1) ​ — ​ — ​ — Foreign exchange (losses)/gains, net 3,787 ​ 0.1 ​ (3,255) ​ (0.1) ​ (3,767) ​ (516) ​ (0.2) Other (expenses)/income, net (413) ​ (0.0) ​ 63 ​ 0.0 ​ 169 ​ 23 ​ 0.0 (Loss)/income before income tax expense ​ (620,150) ​ (21.9) ​ 110,278 ​ 3.7 ​ 38,210 ​ 5,235 ​ 2.0 Income tax expense (110,603) ​ (3.9) ​ (21,534) ​ (0.7) ​ (51,744) ​ (7,089) ​ (2.7) Net (loss)/income ​ (730,753) ​ (25.8) ​ 88,744 ​ 3.0 ​ (13,534) ​ (1,854) ​ (0.7) Note: (1) Share-based compensation expenses were allocated as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2022 ​ 2023 ​ 2024 ​ RMB RMB RMB US$ ​ ​ (in thousands) Share-based compensation expenses: General and administrative expenses 21,383 ​ 15,757 ​ 15,257 ​ 2,090 Research and development expenses 1,679 ​ 1,141 ​ 1,221 ​ 167 Sales and marketing expenses 4,983 ​ 3,328 ​ 3,244 ​ 444 Cost of revenues 200 ​ 113 ​ 59 ​ 8 Total 28,245 ​ 20,339 ​ 19,781 ​ 2,709 ​ ​ 115 Table of Contents Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 Revenues Our revenues decreased by 36.0% from RMB2,958.6 million in 2023 to RMB1,894.4 million (US$259.5 million) in 2024.
The increase was primarily due to the increase in personnel related expenses. 112 Table of Contents Loss from operations As a result of the foregoing, we incurred loss from operations of RMB621.2 million in 2022, and loss from operations of RMB1.1 million (US$0.2 million) in 2023.
The increase was primarily due to the increase in reserve for doubtful accounts in relation to the increasing contribution of the network partner model. Income/(loss) from operations As a result of the foregoing, we incurred income from operations of RMB0.5 million in 2023, and loss from operations of RMB71.2 million (US$9.8 million) in 2024.
General and administrative expenses Our general and administrative expenses increased by 11.7% from RMB112.4 million in 2022 to RMB125.5 million (US$17.7 million) in 2023.
General and administrative expenses Our general and administrative expenses increased by 12.5% from RMB113.8 million in 2022 to RMB128.0 million in 2023. The increase was primarily due to the increase in personnel related expenses.
Net income/(loss) As a result of the foregoing, we generated net loss of RMB124.6 million in 2021 and net loss of RMB711.2 million in 2022. B.
Net income/(loss) As a result of the foregoing, our net income was RMB88.7 million in 2023, compared to a net loss of RMB730.8 million in 2022. 118 Table of Contents B.
Net cash used in investing activities in 2021 was RMB1,714.3 million, consisting of RMB209.4 million used to purchase of property, equipment and software from a related party, RMB263.0 million used to purchase of property, equipment and software from third parties, and RMB2,223.9 million used to purchase of short-term investments, partially offset by RMB982.0 million from maturities of short-term investments.
Investing activities Net cash generated from investing activities in 2024 was RMB419.6 million (US$57.5 million), consisting primarily of RMB5,200.4 million (US$712.4 million) proceeds from maturities of short-term investments, partially offset by RMB4,781.1 million (US$655.0 million) used to purchase of short-term investments.
Research and development expenses Our research and development expenses decreased by 3.4% from RMB93.9 million in 2021 to RMB90.7 million in 2022. This decrease was primarily due to the decrease in system and personnel related expenses. Sales and marketing expenses Our sales and marketing expenses decreased by 8.1% from RMB2,951.0 million in 2021 to RMB2,712.3 million in 2022.
The decrease was partially offset by the increase in cost of revenues in relation to the Photovoltaic business. Research and development expenses Our research and development expenses decreased by 9.4% to RMB82.9 million (US$11.4 million) in 2024, from RMB91.5 million in 2023. The decrease was primarily due to the decrease in personnel related expenses.
Cost of revenues Our cost of revenues increased by 117.2% from RMB556.9 million in 2022 to RMB1.2 billion (US$170.3 million) in 2023.
Other revenues, which primarily comprise of revenue from advertising services and other, decreased by 22.3% from RMB38.4 million in 2023 to RMB29.9 million (US$4.1 million) in 2024. The decrease was primarily attributable to the decrease in advertising revenue. Cost of revenues Our cost of revenues decreased by 9.6% from RMB1.2 billion in 2023 to RMB1.1 billion (US$149.4 million) in 2024.
The increase from 2021 to 2022 was primarily due to the decrease in revenue as a result of COVID-19 outbreaks and the increase in the number of cabinets and power banks within the mobile device charging service network.
The increase in our incentive fee rates from 2023 to 2024 is mainly due to the general decrease in the revenue efficiency of our power banks due to the challenges in the consumption environment and general competition within the mobile device charging service industry.
This decrease was primarily due to the decrease in incentive fees paid to location partners and network partners from the decrease in mobile device charging business revenues, which decreased by 2.1% from RMB2,112.8 million in 2021 to RMB2,069.1 million in 2022, and the decrease in personnel related expenses. Our incentive fees include both commissions and entry fees.
Our revenues generated under the network partner model, which comprise of mobile device charging solution fees of RMB249.8 million, and sales of cabinets, power banks and other related assets of RMB775.1 million, decreased by 42.6% from RMB1.8 billion in 2023 to RMB1.0 billion in 2024. The decrease was primarily due to the change in the contractual arrangement with network partners.
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The more people stay at home or offices, the less likely they will need our services. Our industry is generally affected by the popularity and the prevalence of smart mobile devices. The development of battery technologies also influences our industry.
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Revision on Previously Issued Financial Statements and Corrections on Previously Announced Unaudited Interim Financial Information In connection with the preparation of its unaudited financial results for the three months ended September 30, 2024, we discovered prior period errors in the accrual for tax surcharges and related interest expenses, accruals for commissions to location partners and related balances, the impairment of prepayments to location partners and the expected credit losses on deposits to location partners and accounts receivable due from network partners.

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Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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We have not experienced any material labor disputes or strikes that may have a material and adverse effect on our business, financial condition or results of operations. 125 Table of Contents As required by laws and regulations in China, we participate in various employee social security plans that are organized by municipal and provincial governments including, among other things, pension, medical insurance, unemployment insurance, maternity insurance, on-the-job injury insurance and housing fund plans through a PRC government-mandated benefit contribution plan.
We have not experienced any material labor disputes or strikes that may have a material and adverse effect on our business, financial condition or results of operations. 130 Table of Contents As required by laws and regulations in China, we participate in various employee social security plans that are organized by municipal and provincial governments including, among other things, pension, medical insurance, unemployment insurance, maternity insurance, on-the-job injury insurance and housing fund plans through a PRC government-mandated benefit contribution plan.
The functions and powers of our board of directors include, among others: ● convening shareholders’ annual and extraordinary general meetings and reporting its work to shareholders at such meetings; ● declaring dividends and distributions; ● appointing officers and determining the term of office of the officers; ● exercising the borrowing powers of our company and mortgaging the property of our company; and ● approving the transfer of shares in our company, including the registration of such shares in our register of members. 124 Table of Contents Terms of Directors and Executive Officers Our directors may be appointed by an ordinary resolution of our shareholders.
The functions and powers of our board of directors include, among others: ● convening shareholders’ annual and extraordinary general meetings and reporting its work to shareholders at such meetings; ● declaring dividends and distributions; ● appointing officers and determining the term of office of the officers; ● exercising the borrowing powers of our company and mortgaging the property of our company; and ● approving the transfer of shares in our company, including the registration of such shares in our register of members. 129 Table of Contents Terms of Directors and Executive Officers Our directors may be appointed by an ordinary resolution of our shareholders.
Board Diversity Matrix ​ ​ ​ Board Diversity Matrix (As of March 31, 2024) Country of Principal Executive Offices PRC Foreign Private Issuer Yes Disclosure Prohibited Under Home Country Law No Total Number of Directors 7 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Did Not ​ ​ ​ ​ ​ ​ ​ ​ Disclose ​ Female Male Non-Binary Gender Part I: Gender Identity Directors 2 5 — — Part II: Demographic Background ​ ​ ​ ​ ​ ​ ​ ​ Underrepresented Individual in Home Country Jurisdiction ​ ​ — ​ ​ ​ ​ LGBTQ+ ​ ​ — ​ ​ ​ ​ Did Not Disclose Demographic Background ​ ​ 7 ​ ​ ​ ​ ​ D.
Board Diversity Matrix ​ ​ ​ Board Diversity Matrix (As of March 31, 2025) Country of Principal Executive Offices PRC Foreign Private Issuer Yes Disclosure Prohibited Under Home Country Law No Total Number of Directors 7 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Did Not ​ ​ ​ ​ ​ ​ ​ ​ Disclose ​ Female Male Non-Binary Gender Part I: Gender Identity Directors 2 5 — — Part II: Demographic Background ​ ​ ​ ​ ​ ​ ​ ​ Underrepresented Individual in Home Country Jurisdiction ​ ​ — ​ ​ ​ ​ LGBTQ+ ​ ​ — ​ ​ ​ ​ Did Not Disclose Demographic Background ​ ​ 7 ​ ​ ​ ​ ​ D.
Ms. Xin has over 10 years of experience in corporate finance and capital markets with US-listed companies. Prior to joining us, Ms. Xin held various key roles, including chief financial officer and vice president of investor relations, strategic investments and international media, at Tuniu Corporation (Nasdaq: TOUR) from December 2013 to May 2020.
Xin has over 10 years of experience in corporate finance and capital markets with US-listed companies. Prior to joining us, Ms. Xin held various key roles, including chief financial officer and vice president of investor relations, strategic investments and international media, at Tuniu Corporation (Nasdaq: TOUR) from December 2013 to May 2020. Prior to her tenure at Tuniu Corporation, Ms.
The nominating and corporate governance committee is responsible for, among other things: ● selecting and recommending to the board nominees for election by the shareholders or appointment by the board; ● reviewing annually with the board the current composition of the board with regards to characteristics such as independence, knowledge, skills, experience and diversity; ● making recommendations on the frequency and structure of board meetings and monitoring the functioning of the committees of the board; and advising the board periodically with regards to significant developments in the law and practice of corporate governance as well as our compliance with applicable laws and regulations, and making recommendations to the board on all matters of corporate governance and on any remedial action to be taken.
The nominating and corporate governance committee is responsible for, among other things: ● selecting and recommending to the board nominees for election by the shareholders or appointment by the board; ● reviewing annually with the board the current composition of the board with regards to characteristics such as independence, knowledge, skills, experience and diversity; 128 Table of Contents ● making recommendations on the frequency and structure of board meetings and monitoring the functioning of the committees of the board; and advising the board periodically with regards to significant developments in the law and practice of corporate governance as well as our compliance with applicable laws and regulations, and making recommendations to the board on all matters of corporate governance and on any remedial action to be taken.
The compensation committee is responsible for, among other things: ● reviewing and approving, or recommending to the board for its approval, the compensation for our chief executive officer and other executive officers; ● reviewing and recommending to the board for determination with respect to the compensation of our non-employee directors; 123 Table of Contents ● reviewing periodically and approving any incentive compensation or equity plans, programs or similar arrangements; and selecting compensation consultant, legal counsel or other adviser only after taking into consideration all factors relevant to that person’s independence from management.
The compensation committee is responsible for, among other things: ● reviewing and approving, or recommending to the board for its approval, the compensation for our chief executive officer and other executive officers; ● reviewing and recommending to the board for determination with respect to the compensation of our non-employee directors; ● reviewing periodically and approving any incentive compensation or equity plans, programs or similar arrangements; and selecting compensation consultant, legal counsel or other adviser only after taking into consideration all factors relevant to that person’s independence from management.
Share Ownership The following table sets forth information with respect to the beneficial ownership of our shares as of March 31, 2024, by: ● each of our directors and executive officers; and ● each person known to us to own beneficially 5% or more of our total outstanding shares.
Share Ownership The following table sets forth information with respect to the beneficial ownership of our shares as of March 31, 2025, by: ● each of our directors and executive officers; and ● each person known to us to own beneficially 5% or more of our total outstanding shares.
Xu served as general manager of third-party delivery business and regional manager of groupon business at Meituan from February 2011 to April 2017. Mr. Xu studied telecommunications engineering at Nantong University. 119 Table of Contents Ms. Maria Yi Xin is our partner, and has been serving as our chief financial officer since June 2020 and our director since December 2020.
Xu served as general manager of third-party delivery business and regional manager of groupon business at Meituan from February 2011 to April 2017. Mr. Xu studied telecommunications engineering at Nantong University. Ms. Maria Yi Xin is our partner, and has been serving as our chief financial officer since June 2020 and our director since December 2020. Ms.
She was an associate from 2010 to 2012 and then vice president of CDH Investments from 2013 to 2016. She also served as an investment analyst and then associate at China International Capital Corporation Limited from 2004 to 2008. Ms. Shen holds a bachelor’s degree from Fudan University and an MBA degree from Columbia University. Mr.
She was an associate from 2010 to 2012 and then vice president of CDH Investments from 2013 to 2016. She also served as an investment analyst and then associate at China International Capital Corporation Limited from 2004 to 2008. Ms. Shen holds a bachelor’s degree from Fudan University and an MBA degree from Columbia University. 124 Table of Contents Mr.
Zhang served as the head of customer management at Uber Shanghai from March 2016 to December 2016. Mr. Zhang also served as a brand assistant manager at Johnson & Johnson (China) Co., Ltd. from September 2014 to March 2016. Mr. Zhang received his bachelor’s degree in public administration from Shanghai Jiao Tong University in 2014. 120 Table of Contents B.
Zhang served as the head of customer management at Uber Shanghai from March 2016 to December 2016. Mr. Zhang also served as a brand assistant manager at Johnson & Johnson (China) Co., Ltd. from September 2014 to March 2016. Mr. Zhang received his bachelor’s degree in public administration from Shanghai Jiao Tong University in 2014. B.
Eligibility. We may grant awards to our directors, employees and consultants. Vesting Schedule. In general, the plan administrator determines the vesting schedule, which is specified in the relevant award agreement. Exercise of Options. The plan administrator determines the exercise price for each award, which is stated in the relevant award agreement.
Eligibility. We may grant awards to our directors, employees and consultants. Vesting Schedule. In general, the plan administrator determines the vesting schedule, which is specified in the relevant award agreement. 126 Table of Contents Exercise of Options. The plan administrator determines the exercise price for each award, which is stated in the relevant award agreement.
(4) Represents 7,306,970 Class B ordinary shares, 800,000 Class A ordinary shares in the form of ADSs and 190,000 Class A ordinary shares issuable upon the exercise of options within 60 days of March 31, 2024, held by Victor Family Limited, a British Virgin Islands company wholly owned by Victor Yaoyu Zhang.
(4) Represents 7,306,970 Class B ordinary shares, 800,000 Class A ordinary shares in the form of ADSs and 285,000 Class A ordinary shares issuable upon the exercise of options within 60 days of March 31, 2025, held by Victor Family Limited, a British Virgin Islands company wholly owned by Victor Yaoyu Zhang.
(1) Represents 39,270,000 Class B ordinary shares, 4,280,073 Class A ordinary shares in the form of ADSs, and 425,000 Class A ordinary shares issuable upon the exercise of options within 60 days of March 31, 2024, held by Smart Share Holdings Limited, a British Virgin Islands company wholly owned by Mars Guangyuan Cai.
(1) Represents 39,270,000 Class B ordinary shares, 4,280,073 Class A ordinary shares in the form of ADSs, and 637,500 Class A ordinary shares issuable upon the exercise of options within 60 days of March 31, 2025, held by Smart Share Holdings Limited, a British Virgin Islands company wholly owned by Mars Guangyuan Cai.
Each committee’s members and functions are described below. Audit Committee. Our audit committee consists of Conor Chia-hung Yang, Jiawei Gan and Benny Yucong Xu. Conor Chia-hung Yang is the chairperson of our audit committee.
Each committee’s members and functions are described below. 127 Table of Contents Audit Committee. Our audit committee consists of Conor Chia-hung Yang, Jiawei Gan and Benny Yucong Xu. Conor Chia-hung Yang is the chairperson of our audit committee.
(NYSE: BEST), Sanjiang Shopping Club Co., Ltd. (SSE: 601116), New Hua Du Supercenter Co., Ltd. (SZSE: 002264) and Xiaoju Kuaizhi Inc. (OTCPK: DIDI.Y). Prior to joining Alibaba Group Holding Ltd. in 2018, she served as senior investment officer in International Finance Corporation at World Bank Group from 2017 to 2018.
(SSE: 601116), New Hua Du Supercenter Co., Ltd. (SZSE: 002264) and Xiaoju Kuaizhi Inc. (OTCPK: DIDI.Y). Prior to joining Alibaba Group Holding Ltd. in 2018, she served as senior investment officer in International Finance Corporation at World Bank Group from 2017 to 2018.
(2) Represents 27,397,000 Class B ordinary shares, 3,000,000 Class A ordinary shares in the form of ADSs, and 425,000 Class A ordinary shares issuable upon the exercise of options within 60 days of March 31, 2024, held by Super June Limited, a British Virgin Islands company wholly owned by Peifeng Xu.
(2) Represents 27,397,000 Class B ordinary shares, 3,000,000 Class A ordinary shares in the form of ADSs, and 637,500 Class A ordinary shares issuable upon the exercise of options within 60 days of March 31, 2025, held by Super June Limited, a British Virgin Islands company wholly owned by Peifeng Xu.
The above information is based on the Schedule 13G filed by Shunwei Angels III Limited, among others, on February 14, 2022. (9) Represents 35,877,631 Class A ordinary shares held by China Ventures Fund I Pte. Ltd., which is wholly owned by China Ventures Fund I, Limited Partnership, which is, in turn, controlled by SV GP I Ltd.
The above information is based on the Schedule 13G filed by Shunwei Angels III Limited, among others, on February 14, 2022. (9) Represents 35,877,631 Class A ordinary shares held by China Ventures Fund I Pte. Ltd., which is wholly owned by China Ventures Fund I, Limited Partnership.
These shares and associated votes, however, are not included in the computation of the percentage ownership of any other person. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ % of Ordinary ​ ​ ​ ​ ​ ​ ​ Shares ​ ​ ​ ​ ​ Class A Ordinary ​ Class B Ordinary ​ Beneficially ​ % of Voting ​ ​ Shares Shares Owned Power† ​ Directors and Executive Officers**: ​ Mars Guangyuan Cai (1) 4,705,073 39,270,000 8.5 % 33.6 % Peifeng Xu (2) 3,425,000 27,397,000 6.0 % 23.5 % Maria Yi Xin * — * * ​ Chen Shen ​ — ​ — ​ — ​ — ​ Conor Chia-hung Yang ​ — ​ — ​ — ​ — ​ Jiawei Gan (3) 9,001,545 — 1.7 % * ​ Benny Yucong Xu — — — — ​ Victor Yaoyu Zhang (4) 990,000 7,306,970 1.6 % 6.3 % All Directors and Executive Officers as a Group 20,811,406 73,973,970 18.3 % 64.3 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Principal Shareholders: ​ ​ ​ ​ ​ Taobao China Holding Limited (5) 76,386,109 — 14.8 % 6.5 % Hillhouse entities (6) 62,367,293 — 12.1 % 5.3 % Xiaomi entities (7) 46,977,051 — 9.1 % 4.0 % Smart Share Holdings Limited (1) 4,705,073 39,270,000 8.5 % 33.6 % Shunwei entities (8) 41,989,086 — 8.1 % 3.6 % China Ventures Fund I Pte.
These shares and associated votes, however, are not included in the computation of the percentage ownership of any other person. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ % of Ordinary ​ ​ ​ ​ ​ ​ ​ Shares ​ ​ ​ ​ ​ Class A Ordinary ​ Class B Ordinary ​ Beneficially ​ % of Voting ​ ​ Shares Shares Owned Power† ​ Directors and Executive Officers**: ​ Mars Guangyuan Cai (1) 4,917,573 ​ 39,270,000 ​ 8.7 % 33.9 % Peifeng Xu (2) 3,637,500 ​ 27,397,000 ​ 6.1 % 23.7 % Maria Yi Xin * ​ — ​ * ​ * ​ Chen Shen ​ — ​ — ​ — ​ — ​ Conor Chia-hung Yang ​ — ​ — ​ — ​ — ​ Jiawei Gan (3) 9,001,545 ​ — ​ 1.8 % * ​ Benny Yucong Xu — ​ — ​ — ​ — ​ Victor Yaoyu Zhang (4) 1,085,000 ​ 7,306,970 ​ 1.7 % 6.3 % All Directors and Executive Officers as a Group 21,406,406 ​ 73,973,970 ​ 18.7 % 64.8 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Principal Shareholders: ​ ​ ​ ​ ​ Taobao China Holding Limited (5) 76,386,109 ​ — ​ 15.1 % 6.5 % Hillhouse entities (6) 62,367,293 ​ — ​ 12.3 % 5.3 % Xiaomi entities (7) 46,977,051 ​ — ​ 9.3 % 4.0 % Smart Share Holdings Limited (1) 4,917,573 ​ 39,270,000 ​ 8.7 % 33.9 % Shunwei entities (8) 41,989,086 ​ — ​ 8.3 % 3.6 % China Ventures Fund I Pte.
(9) 35,877,631 — 6.9 % 3.0 % Beautyworks Investment Limited (10) 34,020,246 — 6.6 % 2.9 % Super June Limited (2) 3,425,000 27,397,000 6.0 % 23.5 % Sky9 Capital entities (11) 27,099,870 — 5.2 % 2.3 % Notes: * Aggregate number of shares account for less than 1% of our total ordinary shares on an as-converted basis outstanding as of the date of this annual report. 126 Table of Contents ** Except as indicated otherwise below, the business address of our directors and executive officers is 6th Floor, 799 Tianshan W Road, Changning District, Shanghai 200335, People’s Republic of China. † For each person or group included in this column, percentage of total voting power represents voting power based on both Class A and Class B ordinary shares held by such person or group with respect to all outstanding shares of our Class A and Class B ordinary shares as a single class.
(9) 35,877,631 ​ — ​ 7.1 % 3.1 % Super June Limited (2) 3,637,500 ​ 27,397,000 ​ 6.1 % 23.7 % Sky9 Capital entities (10) 27,099,870 ​ — ​ 5.3 % 2.3 % Notes: * Aggregate number of shares account for less than 1% of our total ordinary shares on an as-converted basis outstanding as of the date of this annual report. 131 Table of Contents ** Except as indicated otherwise below, the business address of our directors and executive officers is 6th Floor, 799 Tianshan W Road, Changning District, Shanghai 200335, People’s Republic of China. † For each person or group included in this column, percentage of total voting power represents voting power based on both Class A and Class B ordinary shares held by such person or group with respect to all outstanding shares of our Class A and Class B ordinary shares as a single class.
We may also terminate an executive officer’s employment without cause upon three-month advance written notice. In such case of termination by us, we will provide severance payments to the executive officer as may be agreed between the executive officer and us. The executive officer may resign at any time with a three-month advance written notice.
We may also terminate an executive officer’s employment without cause upon three-month advance written notice. In such case of termination by us, we will provide severance payments to the executive officer as may be agreed between the executive officer and us.
(NYSE: EDU ; HKEx: 9901). Ms. Xin received bachelor’s degrees in economics and law from Nankai University in China in 2007. Ms. Chen Shen has been serving as our director since June 2023. Ms. Shen currently serves as a director of strategic investments at Alibaba Group Holding Ltd. (NYSE: BABA) and serves as a director of Best Inc.
Xin received bachelor’s degrees in economics and law from Nankai University in China in 2007. Ms. Chen Shen has been serving as our director since June 2023. Ms. Shen currently serves as a director of strategic investments at Alibaba Group Holding Ltd. (NYSE: BABA) and serves as a director of Best Inc. (NYSE: BEST), Sanjiang Shopping Club Co., Ltd.
Prior to her tenure at Tuniu Corporation, Ms. Xin worked in equity research at China Renaissance (HKEx: 1911), a leading financial institution in China. She served as several key investor relations roles in the company such as E-Commerce China Dangdang Inc., a leading business-to-consumer e-commerce company in China and New Oriental Education and Technology Group Inc.
Xin worked in equity research at China Renaissance (HKEx: 1911), a leading financial institution in China. She served as several key investor relations roles in the company such as E-Commerce China Dangdang Inc., a leading business-to-consumer e-commerce company in China and New Oriental Education and Technology Group Inc. (NYSE: EDU ; HKEx: 9901). Ms.
To our knowledge, as of March 31, 2024, an aggregate of 132,939,888 of our issued and outstanding Class A ordinary shares are held by one record holder in the United States, which is Bank of New York Mellon, the depositary of our ADS program.
To our knowledge, as of March 31, 2025, an aggregate of 123,699,048 of our issued and outstanding Class A ordinary shares are held by one record holder in the United States, which is Bank of New York Mellon, the depositary of our ADS program.
Each executive officer has agreed to hold, both during and after the termination or expiry of his or her employment agreement, in strict confidence and not to use, except as required in the performance of his or her duties in connection with the employment or pursuant to applicable law, any of our confidential information or trade secrets, any confidential information or trade secrets of our customers or prospective customers, or the confidential or proprietary information of any third party received by us and for which we have confidential obligations.
The executive officer may resign at any time with a three-month advance written notice. 125 Table of Contents Each executive officer has agreed to hold, both during and after the termination or expiry of his or her employment agreement, in strict confidence and not to use, except as required in the performance of his or her duties in connection with the employment or pursuant to applicable law, any of our confidential information or trade secrets, any confidential information or trade secrets of our customers or prospective customers, or the confidential or proprietary information of any third party received by us and for which we have confidential obligations.
Directors and Senior Management The following table sets forth information regarding our executive officers and directors as of the date of this annual report. ​ Directors and Executive Officers Age Position/Title Mars Guangyuan Cai ​ 41 ​ Chairman of the board of directors and Chief Executive Officer Peifeng Xu ​ 36 ​ Director and President Maria Yi Xin ​ 39 ​ Director and Chief Financial Officer Chen Shen ​ 41 ​ Director Conor Chia-hung Yang ​ 61 ​ Independent Director Jiawei Gan ​ 54 ​ Independent Director Benny Yucong Xu ​ 46 ​ Independent Director Victor Yaoyu Zhang ​ 31 ​ Chief Marketing Officer ​ Mr.
Directors and Senior Management The following table sets forth information regarding our executive officers and directors as of the date of this annual report. ​ Directors and Executive Officers Age Position/Title Mars Guangyuan Cai ​ 42 ​ Chairman of the board of directors and Chief Executive Officer Peifeng Xu ​ 37 ​ Director and President Maria Yi Xin ​ 40 ​ Director and Chief Financial Officer Chen Shen ​ 42 ​ Director Conor Chia-hung Yang ​ 62 ​ Independent Director Jiawei Gan ​ 55 ​ Independent Director Benny Yucong Xu ​ 47 ​ Independent Director Victor Yaoyu Zhang ​ 32 ​ Chief Marketing Officer ​ Mr.
The above information is based on the Schedule 13G/A filed by Beautyworks Investment Limited, among others, on February 5, 2024. 127 Table of Contents (11) Represents (i) 18,558,680 Class A ordinary shares held by Sky9 Capital Fund III, L.P., a Cayman Islands limited partnership, and (ii) 8,541,190 Class A ordinary shares held by Sky9 Capital MVP Fund, L.P., a Cayman Islands limited partnership.
The above information is based on the Schedule 13G/A filed by China Ventures Fund I, Limited Partnership, among others, on December 13, 2024. 132 Table of Contents (10) Represents (i) 18,558,680 Class A ordinary shares held by Sky9 Capital Fund III, L.P., a Cayman Islands limited partnership, and (ii) 8,541,190 Class A ordinary shares held by Sky9 Capital MVP Fund, L.P., a Cayman Islands limited partnership.
The following table summarizes, as of March 31, 2024, the number of outstanding restricted share units and options granted to our directors and executive officers. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Restricted Share ​ Exercise Price ​ ​ Name Units Share Options (US$/Share) Date of Grant Date of Expiration Mars Guangyuan Cai — ​ * ​ 0.01 August 23, 2021 ​ August 23, 2031 Peifeng Xu — ​ * ​ 0.01 August 23, 2021 ​ August 23, 2031 Maria Yi Xin 846,599 ​ — ​ ​ June 2, 2020 Termination of Service ​ — ​ * ​ 0.01 August 23, 2021 ​ August 23, 2031 Victor Yaoyu Zhang — ​ * ​ 0.01 August 23, 2021 ​ August 23, 2031 All directors and executive officers as a group 846,599 ​ 2,380,000 ​ ​ Note: * Less than 1% of our total ordinary shares on an as-converted basis outstanding as of the date of this annual report.
As of March 31, 2025, there are no outstanding restricted share units granted to our directors and executive officers. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Restricted Share ​ Exercise Price ​ ​ Name Units Share Options (US$/Share) Date of Grant Date of Expiration Mars Guangyuan Cai — ​ * ​ 0.01 ​ August 23, 2021 ​ August 23, 2031 ​ ​ ​ * ​ 0.01 ​ April 1, 2024 ​ April 1, 2034 Peifeng Xu — ​ * ​ 0.01 ​ August 23, 2021 ​ August 23, 2031 ​ ​ ​ * ​ 0.01 ​ April 1, 2024 ​ April 1, 2034 Maria Yi Xin — ​ * ​ 0.01 ​ August 23, 2021 ​ August 23, 2031 ​ ​ ​ * ​ 0.01 ​ April 1, 2024 ​ April 1, 2034 Victor Yaoyu Zhang — ​ * ​ 0.01 ​ August 23, 2021 ​ August 23, 2031 ​ ​ ​ ​ * ​ 0.01 ​ April 1, 2024 ​ April 1, 2034 All directors and executive officers as a group — ​ 14,380,000 ​ ​ Note: * Less than 1% of our total ordinary shares on an as-converted basis outstanding as of the date of this annual report.
Employees As of December 31, 2021, 2022 and 2023, we had a total of 5,094, 3,656 and 3,198 employees, respectively.
Employees As of December 31, 2022, 2023 and 2024, we had a total of 3,656, 3,198 and 924 employees, respectively.
The following is a breakdown of our employees as of December 31, 2023, by function: ​ ​ ​ ​ Function Number Business development personnel 2,420 Research & development and supply chain management 206 Other sales and marketing personnel and general & administrative 572 Total 3,198 ​ As of December 31, 2023, all of our employees were based in mainland China.
The following is a breakdown of our employees as of December 31, 2024, by function: ​ ​ ​ ​ Function Number Business development personnel 527 Research & development and supply chain management 24 Other sales and marketing personnel and general & administrative 373 Total 924 ​ As of December 31, 2024, all of our employees were based in mainland China.
As of March 31, 2024, our employees other than directors and executive officers as a group held 341,587 outstanding restricted share units and 2,240,064 outstanding share options. 122 Table of Contents C. Board Practices Our board of directors currently consists of seven directors. A director is not required to hold any shares in our company by way of qualification.
As of March 31, 2025, our employees other than directors and executive officers as a group held 7,713,940 outstanding share options. C. Board Practices Our board of directors currently consists of seven directors. A director is not required to hold any shares in our company by way of qualification.
The calculations in the table below are based on 516,379,351 shares outstanding as of March 31, 2024, comprising of (i) 442,405,381 Class A ordinary shares (excluding 10,492,796 Class A ordinary shares in the form of ADSs held as treasury shares and reserved for future issuance upon the exercising or vesting of awards granted under our company’s share incentive plans) and (ii) 73,973,970 Class B ordinary shares.
The calculations in the table below are based on 507,138,511 shares outstanding as of March 31, 2025, comprising of (i) 433,164,541 Class A ordinary shares (excluding 19,733,636 Class A ordinary shares in the form of ADSs held as treasury shares and reserved for future issuance upon the exercising or vesting of awards granted under our company’s share incentive plans) and (ii) 73,973,970 Class B ordinary shares.
However, without the prior written consent of the participant, no such action may adversely affect in any material way any award previously granted pursuant to the 2021 Share Incentive Plan.
However, without the prior written consent of the participant, no such action may adversely affect in any material way any award previously granted pursuant to the 2021 Share Incentive Plan. The following table summarizes, as of March 31, 2025, the number of outstanding options granted to our directors and executive officers.
As of March 31, 2024, there were options to acquire 4,620,064 Class A ordinary shares and 1,188,186 restricted shares units outstanding under the 2021 Share Incentive Plan. The following paragraphs summarize the principal terms of the 2021 Share Incentive Plan. 121 Table of Contents Type of Awards.
As of March 31, 2025, there were options to acquire 22,093,940 Class A ordinary shares outstanding under the 2021 Share Incentive Plan. The following paragraphs summarize the principal terms of the 2021 Share Incentive Plan. Type of Awards.
Compensation For the years ended December 31, 2023, we paid an aggregate of RMB12.0 million (US$1.7 million) in cash to our executive officers, and RMB1.2 million (US$0.2 million) to our non-executive directors and our former non-executive director who served in 2023.
Compensation For the years ended December 31, 2024, we paid an aggregate of RMB10.7 million (US$1.5 million) in cash to our executive officers, and RMB1.3 million (US$0.2 million) to our non-executive directors who served in 2024. We have not set aside or accrued any amount to provide pension, retirement or other similar benefits to our directors and executive officers.
The number of beneficial owners of our ADSs in the United States is likely to be much larger than the number of record holders of our ordinary shares in the United States. We are not aware of any arrangement that may, at a subsequent date, result in a change of control of our company. F.
The number of beneficial owners of our ADSs in the United States is likely to be much larger than the number of record holders of our ordinary shares in the United States. F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation Not applicable.
Removed
We have not set aside or accrued any amount to provide pension, retirement or other similar benefits to our directors and executive officers.
Added
Special committee On January 5, 2025, our board of directors received a preliminary non-binding proposal letter from Trustar Mobile Charging Holdings Limited (together with its affiliates, “Trustar Capital”), Mr. Mars Guangyuan Cai, Mr. Peifeng Xu, Mr. Victor Yaoyu Zhang, and Ms.
Removed
SV GP I Ltd. is wholly owned by THE EDGEOF, PTE. LTD. The ultimate beneficial owners of THE EDGEOF, PTE. LTD. are Mr. Taira Atsushi, Mr. Son Taejang, who owns his equity interests through Belleisle Japan Inc., and Mr. Lee Joonpyo, who owns his equity interests through WAVEMAKER CO., LTD. The business address of China Ventures Fund I Pte.
Added
Maria Yi Xin (the “Buyer Group”), to acquire all of our outstanding ordinary shares, including the Class A ordinary shares represented by the ADSs that are not already beneficially owned by the Buyer Group for a proposed purchase price of US$0.625 per ordinary share or US$1.25 per ADS in cash.
Removed
Ltd., is 9 Raffles Place, #27-00, Republic Plaza, Singapore 048619. The above information is based on the Schedule 13G/A filed by China Ventures Fund I, Limited Partnership, among others, on February 8, 2024.
Added
On January 6, 2025, our board of directors formed a special committee consisting of three independent and disinterested directors, Messrs. Conor Chia-hung Yang, Jiawei Gan and Benny Yucong Xu, to evaluate and consider the non-binding proposal.
Removed
(10) Represents 34,020,246 Class A ordinary shares, in the form of ADSs, which Beautyworks Investment Limited, Advantech Master Investment Limited, Advantech Capital Partners Ltd. and Advantech Capital L.P. have the shared power to vote or to direct the disposition of.
Added
The general partner of China Ventures Fund I, Limited Partnership is SV GP I Ltd., which may be deemed to have voting and investment power over the securities held by China Ventures Fund I Pte. Ltd.
Removed
The business address of Beautyworks Investment Limited, Advantech Master Investment Limited, Advantech Capital Partners Ltd. and Advantech Capital L.P. is Suites 1707-08, 17/F, One Exchange Square, 8 Connaught Place, Central, Hong Kong.
Added
SV GP I Ltd. is managed by a board of directors, consisting of multiple directors, who must act by majority and no single director has the voting or investment power over SV GP I Ltd. The business address of China Ventures Fund I Pte. Ltd., is 9 Raffles Place, #27-00, Republic Plaza, Singapore 048619.
Removed
Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation Not applicable.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

3 edited+0 added−0 removed14 unchanged
We shall effect the registration of the securities on Form F-3 as soon as practicable, except in certain circumstances. 128 Table of Contents Piggyback Registration Rights.
We shall effect the registration of the securities on Form F-3 as soon as practicable, except in certain circumstances. 133 Table of Contents Piggyback Registration Rights.
Transactions with ZMI (Hong Kong) International Company Limited. As of December 31, 2021, 2022 and 2023, we had amounts due from one of our suppliers, ZMI (Hong Kong) International Company Limited, or ZMI, totaling RMB20.0 million, RMB0.1 million and nil, respectively, in connection with the prepayments we made to ZMI for power bank and cabinet purchases.
Transactions with ZMI (Hong Kong) International Company Limited. As of December 31, 2022, 2023 and 2024, we had amounts due from one of our suppliers, ZMI (Hong Kong) International Company Limited, or ZMI, totaling RMB0.1 million, nil and nil, respectively, in connection with the prepayments we made to ZMI for power bank and cabinet purchases.
We also issued notes payable to ZMI in connection with power bank and cabinet purchases, with a term ranging from three to six months. As of December 31, 2021, 2022 and 2023, the amounts due on these notes were RMB23.3 million, nil and nil, respectively. C. Interests of Experts and Counsel Not applicable.
We also issued notes payable to ZMI in connection with power bank and cabinet purchases, with a term ranging from three to six months. As of December 31, 2022, 2023 and 2024, the amounts due on these notes were nil, nil and nil, respectively. C. Interests of Experts and Counsel Not applicable.

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