Huize Holding Limited (HUIZ) Earnings

Management highlights

- Customer Base Growth & Quality * Added ~798,000 new customers in H1 2026, bringing cumulative total customers to 13.1 million as of June 30 * Average age of long-term insurance customers is 35.3, 62.5% from tier 2 cities and above; average FYP tick size for long-term products increased 25% YoY to RMB 8,211 * 13th and 25th month persistency ratios for long-term products remain above 95%, leading the industry; long-term product repurchase ratio holds at 33.3% - Product Innovation & Partnerships * Maintains stable partnerships with 159 insurance carriers, co-developing customized products across categories * Expanded core annuity product IP with launch of Blizz 5.0 for long-term wealth accumulation and retirement planning * Launched differentiated health products: Darwin No. 15 Kids Protection integrates child critical illness and long-term medical coverage; Changxiang 5.0 expands high-end medical coverage to traditionally underserved customers with pre-existing conditions - AI-Native Transformation * Completed 2.0 multi-agent architecture upgrade for the company AI app; number of users engaging in AI conversations increased 65% since the start of the year * AI enables generation of personalized family insurance plans in under 5 minutes; 45% of active users now generate AI planning reports, expanding service depth for long-term protection needs * AI-powered claims processing (Xiao Ma Li AI) now covers 4 core product categories, with end-to-end processing completed within 1 hour (minutes for most products) * AI integration across workflows reduced total operating expenses to RMB 175 million, improving the expense-to-income ratio to 24.2% - International Expansion * Advanced deployment across key Asian markets; Vietnam's Globcare maintains strong growth, with customized maternal and child health insurance receiving positive market validation * Singapore operations focus on high-value customers seeking protection, wealth allocation, and long-term financial planning, building out a differentiated product portfolio

Guidance

- Second half 2026 will focus on three core priorities: 1) Deepen AI adoption and scale AI's practical business value across customer experience, service capability, and operating efficiency; 2) Accelerate customer-driven product innovation, strengthen competitiveness in savings products, expand long-term health and core protection offerings, and upgrade flagship product IP; 3) Deepen operations in key Asian markets, leverage Hong Kong and Singapore as regional hubs, and strengthen local product and distribution capabilities for long-term international growth. - Domestically, sustained low deposit rates are expected to continue driving household demand for high-yield participating savings insurance, and government support for multi-tiered healthcare systems will sustain demand for commercial insurance. - International operations are on track for profitability: Hong Kong has been profitable since 2025; Singapore is expected to reach profitability in full year 2026; Vietnam is in high-growth mode with minimal losses approaching product-level profitability. - No new major market entry is planned in the next 12-24 months; management will focus on scaling existing international operations.

Segment performance

1. Long-term savings products: FYP of RMB 2 billion, up 45% YoY; average ticket size increased 10.4% YoY to RMB 140,500, accounting for ~72.46% of total FYP. 2. Long-term health insurance: FYP of RMB 204 million, grew 1.6x YoY, accounting for ~7.39% of total FYP. 3. 2A (partner advisor) business: FYP of RMB 216 million, up 44% YoY, accounting for ~7.83% of total FYP. 4. Short-term health and accident insurance: FYP of RMB 376 million, up 48% YoY, accounting for ~13.62% of total FYP. 5. International business (Pony InsurTech): Strong growth in key markets; in Vietnam, GWP grew 45% YoY, revenue grew 24% YoY, number of policies issued grew 48% YoY; Singapore operations are ramping up focused on high-value customers. Total platform GWP reached RMB 4.2 billion, up ~30% YoY (all-time high), total FYP reached RMB 2.76 billion, up 49% YoY, and total company revenue reached RMB 720 million, with net profit attributable to common shareholders of RMB 25.3 million.

Risks & headwinds

No explicit risks or operational failures were discussed in detail during the call. Management noted ongoing macroeconomic and geopolitical uncertainty as a background context, but did not report material negative impacts or ongoing operational issues.

Analyst Q&A

• Q: What tangible returns has the company seen from its AI investments, and where are the largest benefits emerging?

  A: Initial benefits from the first phase of AI adoption came from workflow automation and optimization across the value chain, which reduced operating costs and improved the company's overall expense ratio, demonstrating early success. The second phase, currently underway, is driving front-end improvements: AI enables more self-directed policy purchases via in-app consultations, improves conversion rates, and boosts agent productivity, allowing more premium growth from the same agent headcount.

• Q: What is the profitability status of individual international markets, and how will margin expansion progress as international business grows?

  A: Hong Kong has been profitable since last year and contributes to the bottom line. Singapore, which launched in Q4 2025, is ramping up and expected to reach full-year profitability in 2026. Vietnam is in high-growth mode, not yet EBITDA positive but operating with minimal losses. Overall, the combined international business is profitable, and the company's relatively low net margin stems from continued R&D and capital investments in AI, not weak profitability.

• Q: What is the company's capital allocation strategy, and will it need to raise new capital in the next 12-18 months?

  A: Top priority for capital allocation is organic investment in AI and scaling existing international operations; no new market entry is planned in the next 12-24 months. The company has sufficient cash on its balance sheet, and a capital raise is very unlikely in the near term unless a major transformative M&A opportunity emerges, especially given the company's current relatively low valuation.

• Q: Have recent regulatory changes and news regarding dividend taxation impacted demand for Hong Kong's mainland visitor insurance business?

  A: Based on July and August-to-date data, overall market and company demand momentum in Hong Kong remains robust. The cited dividend taxation regulation is not new; it has long been part of existing Chinese regulations, so it has not altered underlying demand. The core drivers for offshore insurance purchases, including global asset diversification benefits and prevailing interest rate differentials, remain fully intact.