Feng Chen
executive
[Interpreted] Good day, investors and analysts. Welcome to Kandi Technologies Earnings Conference Call for the full year 2025. Thank you for your continued interest in and support of us. 2025 was a pivotal year for Kandi. The past 2 years have been defined by a challenging macro backdrop marked by evolving geopolitical, shifting trade policies and uneven demand across our end markets, which weighed on our operating performance. We are clear-eyed about near-term revenue dynamics.
At the same time, we are encouraged by what our team delivered beneath the surface, meaningful improvements in operating quality, a stronger cash flow profile and a materially healthier balance sheet. In 2025, our gross margin improved to 42.6%, up from 30.8% in 2024. We generated $96.8 million in net cash from operating activities and ended with $211.9 million in cash on hand. These results reflect our commitment to high-quality earnings, more sustainable cash flows and stronger returns on invested capital.
Over the past 18 months, one of my key priorities as CEO together with the management team has been to review and reassess Kandi's business boundaries, growth trajectory and long-term overall direction amid the opportunities presented by technological innovation and industrial upgrading we are placing even greater emphasis on focused execution, disciplined capital allocation and the consistent delivery of major milestones.
Beginning in 2026, Kandi is entering new phase of growth. Our strategy will be anchored around 2 core engines. Our first engine is the off-road electric vehicle business centered on the North American market and spanning UTVs golf cars, electric off-road products and others. This business represents Kandi's core franchise, underpinning stable cash flows and a well-established go-to-market distribution network.
In the first quarter this year, the overall core business remained stable with continued progress in distribution channel expansion. Our dealer network continues to scale with a notable improvement in per dealer sales performance, further broadening our market coverage and brand presence in key markets and laying a solid foundation for full year growth.
In addition, as we enter 2026, we are actively advancing our North American UTV business across 4 dimensions: next-generation model development, enhanced product experience, improved channel efficiency and strengthened supply chain capabilities. We have set internal sales targets, meaningfully above historical levels and have engaged an external automotive design team with proven mass production experience to help design our next-generation UTV products.
Our ambition goes beyond simply selling more units. We are focused on boosting Kandi's product, competitiveness across the North American outdoor recreation and low-carbon mobility market. In December 2025, we signed an agreement to acquire Rawrr, a premium U.S.-based electric off-road vehicle motorcycle brand. With Rawrr now part of the Kandi family, our goal is to establish premier electric off-road motorcycles as a meaningful new growth category within our North American product portfolio by 2026.
We see strong synergies between Rawrr and Kandi's existing North American distribution network, supply chain and product lineup. As we advance the integration, our primary priorities will be brand alignment, channel coordination, supply chain optimization and product development aiming to ensure this acquisition translates into meaningful, measurable revenue contribution rather than a transaction of paper.
Our second engine comprises emerging battery swapping equipment and intelligent robotics business. Battery swapping equipment represents our most important breakthrough opportunity in 2026. In August 2025, our subsidiary, China Battery Exchange was qualified as a battery swap equipment supplier within CATL's supply chain, securing its first order for heavy truck battery swap stations equipment.
In January 2026, China Battery Exchange entered into a 3-year strategic cooperation agreement with CATL's subsidiary covering the mass production and delivery of heavy truck battery swap station equipment. Based on our current order visibility and a production schedule, we are confident in achieving meaningful revenue growth in 2026.
The battery swap equipment business represents more than an incremental revenue stream for Kandi. It demonstrates a remarkable extension of our footprint from low-carbon mobility products into the broader new energy infrastructure sector. Looking ahead, our priorities are centered on execution on heavy truck battery swap station order deliveries, ramping up our mass delivery capacity and capturing emerging commercial opportunities across ports, mining operations and long-haul freight applications.
On the intelligence robotics business front, our focus is on the deployment of autonomous quadruped robots in security, patrol and logistics park environment. We have entered a strategic partnership agreement with Hawk Robo Systems LLC to form a joint venture, KH robotics through which we are developing localized testing, validation and commercial operation capabilities in North America. We expect to complete the first functional demo by approximately June 2026, followed by field testing and initial pilot deployments in the second half of the year. This business remains at an early stage of deployment rather than providing near-term revenue guidance. We will evaluate and communicate progress through clearly defined product milestones and real-world use case validation.
Regarding supply chain capabilities, we will continue to build out our global footprint, anchored by core R&D and manufacturing in Mainland China with flexible capacity in Taiwan and local assembly and front-end distribution network in the United States. The architecture provides meaningful structural insulation against geopolitical uncertainty and trade volatility while also enabling us to respond more quickly and effectively to evolving demand in the North American market.
In sum, looking ahead to 2026. We are focused on 4 clear priorities. First, restoring sales momentum and advancing product upgrade across our UTV and low-carbon mobility lineup in the North America. Second, successfully integrating Rawrr and translating the acquisition into tangible revenue contribution. Third, advancing the battery swaps equipment business from initial order delivery to large-scale deliveries. And fourth, advancing our intelligent robotics business through the completion of functional demo followed by field testing and initial pilot deployment.
At the same time, we will maintain a disciplined approach to capital allocation. Our cash positions are not a justification for indiscriminate expansion, but rather it means to preserve flexibility in an uncertain environment. Any future investments in new business initiatives, acquisitions or capacity expansion must be guided by long-term shareholder returns and will be rigorously evaluated against clear benchmarks, including commercial progress, cash payback cycles and risk-adjusted returns.
Today, Kandi has a clear platform structure, a focused dual engine strategy, a resilient global supply chain and a solid cash position. I firmly believe that with this core competencies and strategic positioning in place. We are well equipped to translate our vision of manufacturing joy driving the future into tangible long-term value for shareholders.
Now let me turn the call over to our CFO, Alan Lim who will provide details on our full year 2025 financial performance. Thank you.
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