ATRenew Inc. Reports Unaudited Fourth Quarter and Full Year 2022 Financial Results

SHANGHAI,March 13,2023 -- ATRenew Inc. ("ATRenew" or the "Company") (NYSE: RERE),a leading technology-driven pre-owned consumer electronics transactions and services platform in China,today announced its unaudited financial results for the fourth quarter and full year ended December 31,2022.

Fourth Quarter 2022 Highlights

Total net revenues grew by 22.4% to RMB2,981.2 million (US$432.2 million) from RMB2,435.8 million in the fourth quarter of 2021.

Loss from operations was RMB2,210.6 million (US$320.5 million),which included impairment losses of RMB1,819.9 million (US$263.9 million) and RMB206.9 million (US$30.0 million) on goodwill and intangible assets,respectively,compared to RMB125.9 million in the fourth quarter of 2021. Adjusted income from operations (non-GAAP)[1] was RMB34.6 million (US$5.0 million) compared to RMB9.7 million in the fourth quarter of 2021.

Number of consumer products transacted[2] decreased by 17.6% to 7.5 million from 9.1 million in the fourth quarter of 2021.

Full Year 2022 Highlights

Total net revenues grew by 26.9% to RMB9,869.4 million (US$1,430.9 million) from RMB7,780.3 million in the full year of 2021.

Loss from operations was RMB2,623.7 million (US$380.4 million),compared to RMB895.1 million in the full year of 2021. Adjusted income from operations (non-GAAP)[1]was RMB6.9 million (US$1.0 million) compared to adjusted loss from operations of RMB103.4 million in the full year of 2021.

Number of consumer products transacted[2]increased by 2.6% to 32.0 million from 31.2 million in the full year of 2021.

1. See "Reconciliations of GAAP and Non-GAAP Results" for more information.

2. "Number of consumer products transacted" represents the number of consumer products distributed to merchants and consumers through transactions on the Company's PJT Marketplace,Paipai Marketplace and other channels the Company operates in a given period,prior to returns and cancellations,excluding the number of consumer products collected through AHS Recycle; a single consumer product may be counted more than once according to the number of times it is transacted on PJT Marketplace,Paipai Marketplace and other channels the Company operates through the distribution process to end consumer.

Mr. Kerry Xuefeng Chen,Founder,Chairman,and Chief Executive Officer of ATRenew,commented,"We responded proactively to the challenging macroeconomy by working diligently and reaching a number of important milestones during the fourth quarter. Our revenue once again reached a new record high,increasing by 22.4% year-over-year to RMB2,981 million in this quarter. Furthermore,under the non-GAAP measures,as we realized an operating income of RMB34.6 million in the fourth quarter,we achieved a full-year profit. Throughout 2022,we put the well-being of our employees and users first and responded promptly to changes in the external environment brought about by resurgences of the pandemic. In addition,we further validated our ability to generate sustainable profitability by leveraging our improved cost efficiencies,powered by our technology-driven supply chain. Looking into 2023,we will continue to steadfastly increase the penetration rate of consumer electronics recycling and take user experience to the next level while creating long-term value for our users,the environment,and our shareholders through the development of the circular economy."

Mr. Rex Chen,Chief Financial Officer of ATRenew,added,"During the fourth quarter,we successfully mitigated the pandemic's adverse impacts on store opening hours and our supply chain through a series of measures. First,we leveraged our supply chain capabilities to lock in quality sources of supply,thereby securing the steady growth of our self-operated business. Second,we upscaled the listings of re-standardized like-new devices by advancing our compliant refurbishment capabilities,generating an expanded profit margin for the industrial chain. In terms of our marketplaces,we continued to maximize efficiency by optimizing user structure and marketing strategies. Following these initiatives,the overall commission rate rebounded to 4.8%. Importantly,we also generated a cash inflow of RMB881 million from operating activities during the year,giving us confidence in our long-term sustainable growth prospects and forming a solid foundation for our share repurchase program. Looking ahead to 2023,we are optimistic that favorable developments in the macroeconomy will strengthen and reinvigorate our business and deliver positive non-GAAP operating incomes in the first quarter and full-year 2023."

Fourth Quarter 2022 Financial Results

REVENUE

Total net revenuesincreased by 22.4% to RMB2,435.8 million in the same period of 2021.

Net product revenues increased by 29.5% to RMB2,687.9 million (US$389.7 million) from RMB2,076.0 million in the same period of 2021. The increase was primarily attributable to an increase in the sales of pre-owned consumer electronics through the Company's offline channels in mainland China and overseas markets,and Paipai Marketplace.

Net service revenues decreased by 18.5% to RMB293.3 million (US$42.5 million) from RMB359.9 million in the same period of 2021. The decrease was primarily due to the lessened consignment business of Paipai Marketplace as the Company shifted its strategic focus.

OPERATING COSTS AND EXPENSES

Operating costs and expenses increased by 31.0% to RMB3,370.6 million (US$488.7 million) from RMB2,573.2 million in the same period of 2021.

Merchandise costs increased by 31.7% to RMB2,370.5 million (US$343.7 million) from RMB1,800.5 million in the same period of 2021. The increase was primarily due to the growth in product sales.

Fulfillment expenses decreased by 5.2% to RMB274.9 million (US$39.9 million) from RMB290.1 million in the same period of 2021. The decrease was primarily due to (i) a decrease in operation center related expenses,(ii) a decrease in logistics expenses related to the decrease in net service revenues,which was partially offset by (i) an increase of depreciation and amortization expenses in relation to the decoration expenditures on opened self-operated AHS stores,and (ii) an increase in expenses in relation to the upgrade of technology server.

Selling and marketing expenses increased by 61.1% to RMB594.0 million (US$86.1 million) from RMB368.8 million in the same period of 2021. The increase was primarily due to the recognition of the impairment loss of intangible assets and deferred cost in fourth quarter of 2022,which was partially offset by a decrease in marketing expenses.

General and administrative expenses increased by 47.6% to RMB76.6 million (US$11.1 million) from RMB51.9 million in the same period of 2021. The increase was primarily due to an increase in professional service fees.

Technology and content expenses decreased by 12.1% to RMB54.5 million (US$7.9 million) from RMB62.0 million in the same period of 2021. The decrease was primarily due to a decrease in personnel cost in relation to the Company's adjustment to its spending in research and development,which was partially offset by an increase in the recognition of the impairment loss of intangible assets.

LOSS FROM OPERATIONS

Loss from operations was RMB2,compared to RMB125.9 million in the same period of 2021.

Adjusted income from operations (non-GAAP)[1],excluding the impairment loss of deferred cost,intangible assets and goodwill,amortization of intangible assets and deferred cost resulting from assets and business acquisitions and recognition of share-based compensation expense resulting from options and restricted stock units granted to employees,was RMB34.6 million (US$5.0 million),compared to adjusted income from operations of RMB9.7 million in the same period of 2021.

NET LOSS

Net loss was RMB2,151.2 million (US$311.9 million),compared to RMB103.6 million in the same period of 2021. Adjusted net income (non-GAAP)[1] was RMB22.5 million (US$3.3 million),compared to adjusted net loss of RMB50.2 million in the same period of 2021.

Considering negative impacts on market demands resulting from the outbreak COVID-19 pandemic and the changes in market conditions,the Company recognized impairment losses of RMB1,for the period ended December 31,2022.

BASIC AND DILUTED NET LOSS PER ORDINARY SHARE

Basic and diluted net loss per ordinary share were RMB13.23 (US$1.92),compared to RMB0.63 in the same period of 2021.

Adjusted basic and diluted net income per ordinary share (non-GAAP)[1]were RMB0.14 (US$0.02) and RMB0.13 (US$0.02),compared to negative RMB0.31 in the same period of 2021.

Full Year 2022 Financial Results

REVENUE

Total net revenuesincreased by 26.9% to RMB9,780.3 million in the full year of 2021.

Net product revenues increased by 30.4% to RMB8,676.7 million (US$1,258.0 million) from RMB6,654.9 million in the full year of 2021. The increase was primarily attributable to an increase in the sales of pre-owned consumer electronics through the Company's offline channels,Paipai Marketplace and overseas offline channels.

Net service revenues increased by 6.0% to RMB1,192.8 million (US$172.9 million) from RMB1,125.4 million in the full year of 2021. The increase was primarily due to the increase in transaction volume and monetization capability of PJT Marketplace.

OPERATING COSTS AND EXPENSES

Operating costs and expenses increased by 23.1% to RMB10,714.4 million (US$1,553.4 million) from RMB8,702.3 million in the full year of 2021.

Merchandise costs increased by 32.5% to RMB7,596.6 million (US$1,101.4 million) from RMB5,735.4 million in the full year of 2021. The increase was primarily due to the growth in product sales.

Fulfillment expenses increased by 5.8% to RMB1,123.5 million (US$162.9 million) from RMB1,062.1 million in the full year of 2021. The increase was primarily due to (i) an increase in personnel cost in connection with the Company's growing business,(ii) an increase in operation center related expenses in line with the increase in our net revenue,(iii) an increase of depreciation and amortization expenses in relation to the decoration expenditures on opened self-operated AHS stores,and (iv) an increase in expenses in relation to the upgrade of technology server,which was partially offset by a decrease in share-based compensation expenses as the Company recognized one-time expense resulting from share-based awards granted with an IPO condition in the second quarter of 2021.

Selling and marketing expenses increased by 27.3% to RMB1,536.1 million (US$222.7 million) from RMB1,206.6 million in the full year of 2021. The increase was primarily due to (i) the recognition of the impairment loss of intangible assets and deferred cost in fourth quarter of 2022,(ii) an increase in personnel cost in connection with the Company's growing business,and (iii) an increase in sales promotion expenses in connection with the Company's growing business,which was partially offset by a decrease in marketing expenses.

General and administrative expenses decreased by 46.9% to RMB230.4 million (US$33.4 million) from RMB433.6 million in the full year of 2021. The decrease was primarily due to a decrease in share-based compensation expenses as the Company recognized one-time expense resulting from share-based awards granted with an IPO condition in the second quarter of 2021.

Technology and content expenses decreased by 13.9% to RMB227.8 million (US$33.0 million) from RMB264.6 million in the full year of 2021. The decrease was primarily due to (i) a decrease in personnel cost in relation to the Company's adjustment to its spending in research and development,and (ii) a decrease in share-based compensation expenses as the Company recognized one-time expense resulting from share-based awards granted with an IPO condition in the second quarter of 2021.

LOSS FROM OPERATIONS

Loss from operations was RMB2,compared to RMB895.1 million in the full year of 2021.

Adjusted income from operations (non-GAAP)[1],was RMB6.9 million (US$1.0 million),compared to adjusted loss from operations of RMB103.4 million in the full year of 2021.

NET LOSS

Net loss was RMB2,467.9 million (US$357.8 million),compared to RMB816.5 million in the full year of 2021. Adjusted net income (non-GAAP)[1]was RMB50.8 million (US$7.4 million),compared to adjusted net loss of RMB168.8 million in the full year of 2021.

Considering the negative impacts on market demands resulting from the outbreak COVID-19 pandemic and the changes in market conditions,2022.

BASIC AND DILUTED NET LOSS PER ORDINARY SHARE

Basic and diluted net loss per ordinary share were RMB15.16 (US$2.20),compared to RMB13.76 in the same period of 2021.

Adjusted basic and diluted net income per ordinary share (non-GAAP)[1]were RMB0.31 (US$0.05) and RMB0.30 (US$0.04),compared to negative RMB1.75 in the same period of 2021.

CASH AND CASH EQUIVALENTS,RESTRICTED CASH,SHORT-TERM INVESTMENTS AND FUNDS RECEIVABLE FROM THIRD PARTY PAYMENT SERVICE PROVIDERS

Cash and cash equivalents,restricted cash,short-term investments and funds receivable from third party payment service providers increased to RMB2,802.1 million (US$406.3 million) as of December 31,2022 from RMB2,421.9 million as of December 31,2021.

Business Outlook

For the first quarter of 2023,the Company currently expects its total revenues to be between RMB2,770.0 million and RMB2,870.0 million. This forecast only reflects the Company's current and preliminary views on the market and operational conditions,which are subject to change.

Recent Development

On December 9,2022,ATRenew announced that its board of directors has authorized an extension of the Company's existing share repurchase program for another twelve-month period starting from December 28,with all other terms remain unchanged. The Company's board of directors adopted the existing share repurchase program on December 28,2021,pursuant to which the Company may repurchase up to US$100 million of its shares over a twelve-month period starting from December 28,2021. During the fourth quarter 2022,the Company repurchased 383,304 American depositary shares ("ADSs") in the open market at an average price of US$2.22 per ADS,with a total cash consideration of US$0.9 million. As at the end of the fourth quarter 2022,the Company repurchased a total of 8,548,973 ADSs for approximately US$33.9 million under its share repurchase program.

Conference Call Information

The Company's management will hold a conference call on Monday,2023 at 08:00 A.M. Eastern Time (or 08:00 P.M. Beijing Time on the same day) to discuss the financial results. Listeners may access the call by dialing the following numbers:

International:

1-412-317-6061

United States Toll Free:

1-888-317-6003

Mainland China Toll Free:

4001-206115

Hong Kong Toll Free:

800-963976

Access Code:

4149222

The replay will be accessible through March 20,2023 by dialing the following numbers:

International:

1-412-317-0088

United States Toll Free:

1-877-344-7529

Access Code:

7428608

A live and archived webcast of the conference call will also be available at the Company's investor relations website at ir.atrenew.com.

About ATRenew Inc.

Headquartered in Shanghai,ATRenew Inc. operates a leading technology-driven pre-owned consumer electronics transactions and services platform in China under the brand ATRenew. Since its inception in 2011,ATRenew has been on a mission to give a second life to all idle goods,addressing the environmental impact of pre-owned consumer electronics by facilitating recycling and trade-in services,and distributing the devices to prolong their lifecycle. ATRenew's open platform integrates C2B,B2B,and B2C capabilities to empower its online and offline services. Through its end-to-end coverage of the entire value chain and its proprietary inspection,grading,and pricing technologies,ATRenew sets the standard for China's pre-owned consumer electronics industry.

Exchange Rate Information

This announcement contains translations of certain RMB amounts into U.S. dollars at specified rates solely for the convenience of the reader. Unless otherwise noted,all translations from RMB to U.S. dollars are made at a rate of RMB6.8972 to US$1.00,the exchange rate set forth in the H.10 statistical release of the Board of Governors of the Federal Reserve System as of December 31,2022.

Use of Non-GAAP Financial Measures

The Company also uses certain non-GAAP financial measures in evaluating its business. For example,the Company uses adjusted (loss) income from operations,adjusted net (loss) income and adjusted net (loss) income per ordinary share as supplemental measures to review and assess its financial and operating performance. The presentation of these non-GAAP financial measures is not intended to be considered in isolation,or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. Adjusted (loss) income from operations is loss from operations excluding the impact of the impairment loss of deferred cost,share-based compensation expenses and amortization of intangible assets and deferred cost resulting from assets and business acquisitions. Adjusted net (loss) income is net loss excluding the impact of the impairment loss of deferred cost,share-based compensation expenses and amortization of intangible assets and deferred cost resulting from assets and business acquisitions and tax effects of impairment loss of deferred cost and intangible assets and amortization of intangible assets and deferred cost resulting from assets and business acquisitions. Adjusted net (loss) income per ordinary share is adjusted net (loss) income attributable to ordinary shareholders divided by weighted average number of shares used in calculating net loss per ordinary share.

The Company presents non-GAAP financial measures because they are used by the Company's management to evaluate the Company's financial and operating performance and formulate business plans. The Company believes that adjusted (loss) income from operations and adjusted net (loss) income help identify underlying trends in the Company's business that could otherwise be distorted by the effect of certain expenses that are included in loss from operations and net loss. The Company also believes that the use of non-GAAP financial measures facilitates investors' assessment of the Company's operating performance. The Company believes that adjusted (loss) income from operations and adjusted net (loss) income provide useful information about the Company's operating results,enhance the overall understanding of the Company's past performance and future prospects and allow for greater visibility with respect to key metrics used by the Company's management in its financial and operational decision making.

The non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. The non-GAAP financial measures have limitations as analytical tools. One of the key limitations of using non-GAAP financial measures is that they do not reflect all items of income and expense that affect the Company's operations. The impairment loss of deferred cost,share-based compensation expenses,amortization of intangible assets and deferred cost resulting from assets and business acquisitions and tax effects of impairment loss of deferred cost and intangible assets and amortization of intangible assets and deferred cost resulting from assets and business acquisitions have been and may continue to be incurred in the Company's business and is not reflected in the presentation of non-GAAP financial measures. Further,the non-GAAP measures may differ from the non-GAAP measures used by other companies,including peer companies,potentially limiting the comparability of their financial results to the Company's. In light of the foregoing limitations,the non-GAAP financial measures for the period should not be considered in isolation from or as an alternative to loss from operations,net loss,and net loss attributable to ordinary shareholders per share,or other financial measures prepared in accordance with U.S. GAAP.

The Company compensates for these limitations by reconciling the non-GAAP financial measures to the nearest U.S. GAAP performance measures,which should be considered when evaluating the Company's performance. For reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures,please see the section of the accompanying tables titled,"Reconciliations of GAAP and Non-GAAP Results."

Safe Harbor Statement

This press release contains statements that may constitute "forward-looking" statements pursuant to the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "aims," "future," "intends," "plans," "believes," "estimates," "likely to" and similar statements. Among other things,quotations in this announcement,contain forward-looking statements. ATRenew may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the "SEC"),in its annual report to shareholders,in press releases and other written materials and in oral statements made by its officers,directors or employees to third parties. Statements that are not historical facts,including statements about ATRenew's beliefs,plans and expectations,are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement,including but not limited to the following: ATRenew's strategies; ATRenew's future business development,financial condition and results of operations; ATRenew's ability to maintain its relationship with major strategic investors; its ability to facilitate pre-owned consumer electronics transactions and provide relevant services; its ability to maintain and enhance the recognition and reputation of its brand; general economic and business conditions globally and in China and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in ATRenew's filings with the SEC. All information provided in this press release is as of the date of this press release,and ATRenew does not undertake any obligation to update any forward-looking statement,except as required under applicable law.

Investor Relations Contact

In China:

ATRenew Inc.

Investor Relations

Email: ir@atrenew.com

In the United States:

ICR LLC.

Email: atrenew@icrinc.com

Tel: +1-212-537-0461

ATRENEW INC.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in thousands,except share and per share and otherwise noted)

As of December 31,

As of December 31,

2021

2022

RMB

RMB

US$

ASSETS

Current assets:

Cash and cash equivalents

1,356,342

1,703,626

247,003

Restricted cash

150,000

—

—

Short-term investments

510,467

782,230

113,413

Amount due from related parties,net

410,088

115,501

16,746

Inventories

478,751

433,467

62,847

Funds receivable from third party payment service providers

405,095

316,277

45,856

Prepayments and other receivables,net

840,102

539,077

78,159

Total current assets

4,150,845

3,890,178

564,024

Non-current assets:

Amount due from related parties,net,non-current

—

180,000

26,098

Long-term investments

241,527

219,583

31,837

Property and equipment,net

103,843

118,600

17,195

Intangible assets,net

1,075,811

544,650

78,967

Goodwill

1,803,415

—

—

Other non-current assets

127,321

95,744

13,882

Total non-current assets

3,351,917

1,158,577

167,979

TOTAL ASSETS

7,502,762

5,048,755

732,003

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:

Short-term borrowings

94,999

123,983

17,976

Accounts payable

41,311

73,335

10,633

Contract liabilities

211,964

195,369

28,326

Accrued expenses and other current liabilities

296,627

449,489

65,170

Accrued payroll and welfare

105,787

132,468

19,206

Amount due to related parties

73,976

47,604

6,902

Total current liabilities

824,664

1,022,248

148,213

Non-current liabilities:

Operating lease liabilities,non-current

34,501

33,523

4,860

Deferred tax liabilities

223,138

111,312

16,139

Total non-current liabilities

257,639

144,835

20,999

TOTAL LIABILITIES

1,082,303

1,167,083

169,212

TOTAL SHAREHOLDERS' EQUITY

6,420,459

3,881,672

562,791

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

7,003

ATRENEW INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Amounts in thousands,except share and per share and otherwise noted)

Three months ended December 31,

Years ended December 31,

2021

2022

2021

2022

RMB

RMB

US$

RMB

RMB

US$

Net revenues

Net product revenues

2,955

2,687,917

389,711

6,654,893

8,676,672

1,257,999

Net service revenues

359,873

293,256

42,518

1,125,382

1,192,752

172,933

Operating (expenses) income (1)(2)(3)

Merchandise costs

(1,800,488)

(2,370,546)

(343,697)

(5,735,393)

(7,596,613)

(1,101,405)

Fulfillment expenses

(290,128)

(274,927)

(39,861)

(1,062,066)

(1,123,495)

(162,891)

Selling and marketing expenses

(368,767)

(594,027)

(86,126)

(1,206,649)

(1,536,052)

(222,707)

General and administrative expenses

(51,898)

(76,605)

(11,107)

(433,629)

(230,421)

(33,408)

Technology and content expenses

(61,962)

(54,456)

(7,895)

(264,560)

(227,812)

(33,030)

Goodwill impairment loss

—

(1,819,926)

(263,864)

—

(1,864)

Other operating income (loss),net

11,523

(1,305)

(189)

26,950

41,238

5,979

Loss from operations

(125,892)

(2,210,619)

(320,510)

(895,072)

(2,623,657)

(380,394)

Interest expense

(1,785)

(1,078)

(156)

(16,778)

(6,163)

(894)

Interest income

2,086

2,961

429

8,370

17,780

2,578

Other (loss) income,net

(53,301)

(13,678)

(1,983)

(50,367)

38,791

5,624

Loss before income taxes

(178,222,414)

(322,220)

(953,847)

(2,573,249)

(373,086)

Income tax benefits

82,103

71,476

10,363

143,863

111,783

16,207

Share of loss in equity method investments

(6,847)

(307)

(45)

(6,563)

(6,471)

(938)

Net loss

(103,636)

(2,151,245)

(311,902)

(816,547)

(2,467,937)

(357,817)

Accretion of convertible redeemable preferred shares

—

—

—

(508,627)

—

—

Net loss attributable to ordinary shareholders of the Company

(103,902)

(1,325,174)

(2,817)

Net loss per ordinary share:

Basic

(0.63)

(13.23)

(1.92)

(13.76)

(15.16)

(2.20)

Diluted

(0.63)

(13.23)

(1.92)

(13.76)

(15.16)

(2.20)

Weighted average number of shares used in calculating net loss

per ordinary share

Basic

163,367,269

162,569,309

162,309

96,306,113

162,410

162,410

Diluted

163,410

Net loss

(103,817)

Foreign currency translation adjustments

1,390

8,751

1,269

2,239

(30,032)

(4,354)

Total comprehensive loss

(102,246)

(2,142,494)

(310,633)

(814,308)

(2,497,969)

(362,171)

Accretion of convertible redeemable preferred shares

—

—

—

(508,627)

—

—

Total comprehensive loss attributable to ordinary shareholders

(102,633)

(1,322,935)

(2,171)

ATRENEW INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (CONTINUED)

(Amounts in thousands,

2021

2022

2021

2022

RMB

RMB

US$

RMB

RMB

US$

(1) Includes share-based compensation expenses as follows:

Fulfillment expenses

(10,291)

(15,665)

(2,271)

(59,583)

(44,088)

(6,392)

Selling and marketing expenses

(8,600)

(12,025)

(1,743)

(38,463)

(35,547)

(5,154)

General and administrative expenses

(18,977)

(21,940)

(3,181)

(316,911)

(72,270)

(10,478)

Technology and content expenses

(7,656)

(7,970)

(1,156)

(39,595)

(22,331)

(3,238)

(2) Includes amortization of intangible assets and deferred cost resulting from assets

and business acquisitions as follows:

Selling and marketing expenses

(88,455)

(88,747)

(12,867)

(330,755)

(352,748)

(51,144)

Technology and content expenses

(1,580)

(1,580)

(229)

(6,320)

(6,320)

(916)

(3) Includes impairment loss of deferred cost,intangible assets and goodwill as follows:

Selling and marketing expenses

—

(271,114)

(39,308)

—

(271,308)

Technology and content expenses

—

(6,217)

(901)

—

(6,217)

(901)

Goodwill impairment loss

—

(1,864)

Reconciliations of GAAP and Non-GAAP Results

(Amounts in thousands,

2021

2022

2021

2022

RMB

RMB

US$

RMB

RMB

US$

Loss from operations

(125,394)

Add:

Share-based compensation expenses

45,524

57,600

8,351

454,552

174,236

25,262

Amortization of intangible assets and deferred cost resulting from assets and business

acquisitions

90,035

90,327

13,096

337,075

359,068

52,060

Impairment loss of deferred cost,intangible assets and goodwill

—

2,097,257

304,073

—

2,073

Adjusted income (loss) from operations (non-GAAP)

9,667

34,565

5,010

(103,445)

6,904

1,001

Net loss

(103,817)

Add:

Share-based compensation expenses

45,073

Less:

Tax effects of impairment loss of deferred cost and intangible assets and amortization of

intangible assets and deferred cost resulting from assets and business acquisitions

(82,103)

(71,476)

(10,363)

(143,863)

(111,783)

(16,207)

Adjusted net (loss) income (non-GAAP)

(50,180)

22,463

3,255

(168,783)

50,841

7,371

Adjusted net (loss) income per ordinary share (non-GAAP):

Basic

(0.31)

0.14

0.02

(1.75)

0.31

0.05

Diluted

(0.31)

0.13

0.02

(1.75)

0.30

0.04

Weighted average number of shares used in calculating net loss per ordinary share

Basic

163,269

169,321,970

169,970

96,113

169,935,902

169,902