Income Taxes (Tables)
|
12 Months Ended |
Dec. 31, 2025 |
|---|
| Income Tax Disclosure [Abstract] |
|
| Summary of Provisions for Income Tax Expense/(Benefit) |
The provisions for income tax expense/(benefit) are summarized as follows (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Years Ended December 31, |
|
|
|
2023 |
|
|
2024 |
|
|
2025 |
|
|
|
RMB |
|
|
RMB |
|
|
RMB |
|
Current tax benefit |
|
|
(5,914 |
) |
|
|
(2,267 |
) |
|
|
(1,768 |
) |
Deferred tax expense |
|
|
18,890 |
|
|
|
6,912 |
|
|
|
9,927 |
|
Income tax expense |
|
|
12,976 |
|
|
|
4,645 |
|
|
|
8,159 |
|
|
| Components of Income/(Loss) Before Tax and Income Tax Expense/(Benefit) for PRC and Non-PRC Operations |
The components of income/(loss) before tax and income tax expense/(benefit) for PRC and non-PRC operations are as follows (in thousands):
|
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|
|
|
|
|
|
|
|
|
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|
For the Years Ended December 31, |
|
|
|
2023 |
|
|
2024 |
|
|
2025 |
|
|
|
RMB |
|
|
RMB |
|
|
RMB |
|
(Loss)/income arising from PRC operations |
|
|
(85,525 |
) |
|
|
(25,629 |
) |
|
|
63,300 |
|
Loss arising from non-PRC operations |
|
|
(10,614 |
) |
|
|
(22,672 |
) |
|
|
(54,776 |
) |
(Loss)/income before tax |
|
|
(96,139 |
) |
|
|
(48,301 |
) |
|
|
8,524 |
|
Income tax expense relating to PRC operations |
|
|
12,976 |
|
|
|
4,645 |
|
|
|
8,159 |
|
Income tax benefit relating to non-PRC operations |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Income tax expense |
|
|
12,976 |
|
|
|
4,645 |
|
|
|
8,159 |
|
Effective tax rate for PRC |
|
|
(15.2 |
)% |
|
|
(18.1 |
)% |
|
|
12.9 |
% |
Effective tax rate for the Group |
|
|
(13.5 |
)% |
|
|
(9.6 |
)% |
|
|
95.7 |
% |
|
| Reconciliation of Differences between PRC Statutory Income Tax Rate and Group's Effective Income Tax Rate |
The following is reconciliation between the statutory rate and the Group’s effective tax rate. For 2023, 2024 and 2025, the statutory rate represented the PRC statutory rate of 25%. Reconciliation of the differences between PRC statutory income tax rate and the Group’s effective income tax rate for the years ended December 31, 2023 and 2024 are as follows.:
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|
|
|
|
|
|
|
|
|
For the Years Ended December 31, |
|
|
|
2023 |
|
|
2024 |
|
|
|
% |
|
|
% |
|
Statutory income tax rate |
|
|
25.0 |
|
|
|
25.0 |
|
Permanent differences |
|
|
16.3 |
|
|
|
2.8 |
|
Change in valuation allowance |
|
|
(46.4 |
) |
|
|
(25.2 |
) |
Effect of preferential tax treatment |
|
|
(7.4 |
) |
|
|
(6.9 |
) |
Uncertain tax positions |
|
|
1.8 |
|
|
|
6.4 |
|
Tax rate difference from statutory rate in other jurisdictions |
|
|
(2.8 |
) |
|
|
(11.7 |
) |
Effective income tax rate |
|
|
(13.5 |
) |
|
|
(9.6 |
) |
13. Income Taxes (Continued) Income Tax Expense/(Benefit) and Effective Tax Rate (Continued) In accordance with the updated requirements of ASU No. 2023-09, a reconciliation between PRC statutory rate and the Group’s effective tax rate for the year ended December 31, 2025 is as follows:
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|
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|
For the Years Ended December 31, |
|
|
|
2025 |
|
|
|
RMB |
|
|
% |
|
|
|
(In thousands except percentages) |
|
Statutory Income Tax Rate: |
|
|
2,131 |
|
|
|
25.0 |
|
Foreign Tax Effects |
|
|
|
|
|
|
Cayman |
|
|
|
|
|
|
Statutory tax rate difference between Cayman and the PRC |
|
|
275 |
|
|
|
3.2 |
|
Hong Kong |
|
|
|
|
|
|
Statutory tax rate difference between Hong Kong and the PRC |
|
|
4,558 |
|
|
|
53.5 |
|
Changes in valuation allowances |
|
|
8,848 |
|
|
|
103.8 |
|
Other foreign jurisdictions |
|
|
13 |
|
|
|
0.2 |
|
Nontaxable or Nondeductible Items |
|
|
|
|
|
|
Research and development credits |
|
|
(4,653 |
) |
|
|
(54.6 |
) |
Nondeductible entertainment fee |
|
|
2,448 |
|
|
|
28.7 |
|
Preferential tax treatment |
|
|
3,323 |
|
|
|
39.0 |
|
Other |
|
|
99 |
|
|
|
1.1 |
|
Change in Valuation Allowance |
|
|
(7,382 |
) |
|
|
(86.6 |
) |
Uncertain Tax Positions |
|
|
(1,501 |
) |
|
|
(17.6 |
) |
Effective Income Tax Rate |
|
|
8,159 |
|
|
|
95.7 |
|
|
| Combined Effects of Income Tax Exemption and Other Preferential Tax Treatment |
The combined effects of the income tax exemption and other preferential tax treatment available to the Group are as follows (in thousands, except per share data):
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
For the Years Ended December 31, |
|
|
|
2023 |
|
|
2024 |
|
|
2025 |
|
|
|
RMB |
|
|
RMB |
|
|
RMB |
|
Effect of preferential tax treatment |
|
|
(7,139 |
) |
|
|
(3,346 |
) |
|
|
(3,323 |
) |
Basic net (loss)/income per share effect |
|
|
(0.01 |
) |
|
|
(0.01 |
) |
|
|
(0.01 |
) |
|
| Tax Effects of Temporary Differences that Give Rise to Deferred Tax Assets Balance |
The tax effects of temporary differences that give rise to the deferred tax assets balance as of December 31, 2024 and 2025 are as follows (in thousands):
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|
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|
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|
As of December 31, |
|
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|
2024 |
|
|
2025 |
|
|
|
RMB |
|
|
RMB |
|
Deferred tax assets: |
|
|
|
|
|
|
Allowances for expected credit loss of receivables |
|
|
23,596 |
|
|
|
20,100 |
|
Accrued payroll and expenses and others |
|
|
30,633 |
|
|
|
23,436 |
|
Net operating loss carryforward |
|
|
293,528 |
|
|
|
292,618 |
|
Less: valuation allowance |
|
|
(284,499 |
) |
|
|
(282,823 |
) |
Total deferred tax assets, net |
|
|
63,258 |
|
|
|
53,331 |
|
|
| Movement of Valuation Allowance for Deferred Tax Assets |
The following table sets forth the movement of the valuation allowance for deferred tax assets (in thousands):
|
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|
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|
|
|
|
|
|
|
|
|
|
2023 |
|
|
2024 |
|
|
2025 |
|
|
|
RMB |
|
|
RMB |
|
|
RMB |
|
Balance as of January 1, |
|
|
263,229 |
|
|
|
307,818 |
|
|
|
284,499 |
|
Additions |
|
|
50,151 |
|
|
|
12,159 |
|
|
|
16,050 |
|
Reversals |
|
|
(5,562 |
) |
|
|
(35,478 |
) |
|
|
(17,726 |
) |
Balance as of December 31, |
|
|
307,818 |
|
|
|
284,499 |
|
|
|
282,823 |
|
|
| Reconciliation of Liabilities Associated with Uncertain Tax Positions |
A reconciliation of the beginning and ending amount of liabilities associated with uncertain tax positions is as follows (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
|
2024 |
|
|
2025 |
|
|
|
RMB |
|
|
RMB |
|
|
RMB |
|
Balance as of January 1, |
|
|
20,333 |
|
|
|
18,598 |
|
|
|
15,497 |
|
Reversal of uncertain tax positions over 10 years |
|
|
(4,236 |
) |
|
|
(4,635 |
) |
|
|
(1,501 |
) |
Increase related to current year tax positions |
|
|
2,501 |
|
|
|
1,534 |
|
|
|
— |
|
Balance as of December 31, |
|
|
18,598 |
|
|
|
15,497 |
|
|
|
13,996 |
|
|