DSC Reports Second Quarter 2026 Unaudited Financial Results
Rhea-AI Summary
DSC (Nasdaq: DSC) reported unaudited Q2 2026 results with revenue of RMB167.0 million, up 3.7% year over year. GAAP net loss expanded to RMB240.5 million, mainly due to RMB227.8 million of share-based compensation and IPO-related expenses recognized upon its June 2026 Nasdaq listing.
Adjusted net loss (non-GAAP) narrowed 61.5% to RMB7.4 million, supported by a 14.0% decline in both G&A and sales and marketing expenses and a 29.2% decline in R&D (all excluding share-based compensation). Cash and cash equivalents increased to RMB451.3 million as of June 30, 2026. DSC also began disclosing used-car-specific operating metrics, including 65,334 dealership MAUs, 199,933 user MAUs, and ARPU of monetized used car dealerships of RMB6,672, while highlighting growing AI-powered products and early monetization opportunities.
Positive
- Revenue +3.7% YoY to RMB167.0 million in Q2 2026
- Adjusted net loss narrowed 61.5% YoY to RMB7.4 million
- Operating expenses ex-share-based comp down 14.0% (G&A), 14.0% (sales & marketing), 29.2% (R&D)
- Cash and cash equivalents rose to RMB451.3 million from RMB178.9 million at year-end 2025
- Short-term investments increased to RMB79.4 million from RMB31.7 million
- Dealer engagement metrics show 65,334 dealership MAUs and 9,146 monetized used car dealerships
Negative
- GAAP net loss widened to RMB240.5 million from RMB25.0 million YoY
- Cost of revenue increased 15.0% YoY to RMB108.0 million
- Gross profit declined to RMB59.0 million from RMB67.2 million YoY
- Operating loss rose to RMB243.5 million from RMB24.6 million YoY
- Total operating expenses more than tripled to RMB302.5 million, driven by IPO-related share-based compensation
News Explained
The completed June IPO changed DSC’s reported capital structure: at
Key Figures
Historical Context
| Date | Event | Sentiment | 24h Move | Catalyst |
|---|---|---|---|---|
| Aug 19 | Earnings scheduling | Neutral | -0.3% | Results release timing was announced; the stock recorded a negative 24-hour reaction. |
| Jun 26 | ADR appointment | Neutral | -20.4% | Deutsche Bank was appointed depositary bank for DSC's sponsored ADR program. |
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
Both prior general-news events were followed by negative 24-hour reactions, including -20.41% for the ADR appointment.
Key Terms
non-gaap financial
arpu financial
llms technical
AI-generated analysis. How Rhea-AI works. Not financial advice.
HANGZHOU, China, Aug. 26, 2026 (GLOBE NEWSWIRE) -- DSC Holdings Ltd. (“DSC” or the “Company”) (Nasdaq: DSC), the AI application infrastructure for China’s used car industry, today announced its unaudited financial results for the second quarter ended June 30, 2026.
| FINANCIAL HIGHLIGHTS | |||
| (Amounts in millions, except per ADS) | Q2 2026 | Q2 2025 | Q2 2026 |
| RMB | RMB | US$ | |
| Revenue | 167.0 | 161.1 | 24.6 |
| Net loss | (240.5) | (25.0) | (35.4) |
| Adjusted net loss (non-GAAP) | (7.4) | (19.2) | (1.1) |
| Adjusted basic and diluted net loss per ADS | (0.15) | (2.82) | (0.02) |
- Second quarter revenue increased
3.7% year over year, while adjusted net loss (non-GAAP) narrowed by61.5% , reflecting continued significant improvement in operating efficiency.
- GAAP net loss was RMB240.5 million (US
$35.4 million ), primarily reflecting the recognition of RMB227.8 million (US$33.6 million ) in share-based compensation upon the completion of the IPO in June 2026 and IPO-related expenses.
| OPERATING HIGHLIGHTS | Q2 2026 |
| Operating System Engagement Metrics – DaFengChe1 | |
| Dealership MAU2 | 65,334 |
| User MAU2 | 199,933 |
| Monetization Metrics – used car dealers only1 | |
| Dealerships | |
| • Number of monetized used car dealerships3 | 9,146 |
| • ARPU of monetized used car dealerships4 | RMB6,672 |
| Transaction Services | |
| • Number of monetized transaction services5 | 214,451 |
| • Average revenue per transaction service6 | RMB259 |
- Beginning with this Q2 2026 earnings release, the Company starts reporting certain operating metrics for its used car related operations in light of the overall evolution of its businesses. Please note that such used-car-only metrics should not be directly compared to historical operating metrics, which comprised different components.
- “Dealership MAU” refers to average monthly active dealership accounts, and “User MAU” refers to average monthly active individual user accounts. Both are measured by the number of unique mobile devices that have accessed DSC’s operating system at least once during a month, except that if a user uses multiple mobile devices to access DSC’s operating system during a given month, they will be counted as only one dealership or one user account.
- “Monetized used car dealerships” refers to used car dealerships from whom DSC generates revenues by receiving a fee from either the dealership or its collaborator.
- "ARPU of monetized used car dealerships" refers to the average revenue per monetized used car dealership, calculated by dividing the total revenue generated from monetized used car dealerships by the number of such dealerships during a given period.
- “Monetized transaction services” refers to used car related transaction services that the Company generates revenues from, primarily B2B matching, used car inspection, car delivery and other B2B collaboration services. The Company also provides some transaction services to used car dealers free of charge.
- “Average revenue per transaction service” refers to the average revenue generated per monetized transaction service, calculated by dividing the total revenue generated from monetized transaction services by the number of such services during a given period.
MANAGEMENT COMMENTS
Mr. Junhong Yao, founder, director and chief executive officer of DSC, commented: “The second quarter marked an important milestone for DSC with the completion of our Nasdaq IPO in June. Our operating performance remained resilient during the quarter, with DaFengChe maintaining broad, in-depth dealer engagement, our revenue growing year over year, and our losses narrowing significantly.”
“In the second quarter, we also made meaningful progress in AI-powered products and services. We developed several AI agents by training commoditized LLMs on our massive, granular, proprietary, real-time data, and deployed them into used car dealers’ daily workflows. Our market intelligence AI agents enabled dealers to make far better-informed purchasing and selling decisions, and have delivered tangible results for some of them. These early successes demonstrate the value that AI can create when applied to a conventional industry in the real economy. While creating value for dealers, these AI applications are also presenting a number of new monetization opportunities for DSC, which we are actively exploring and expect to test through selected trials in the near term," he added.
“At the same time, our Nasdaq listing has placed us on the global stage just as China's used-car exports are growing tremendously. We have begun to cautiously explore how our technological capabilities could support this rapidly expanding cross-border market.”
Ms. Qin Zou, director and chief financial officer of DSC, added: "We are pleased with our performance in the second quarter, with revenue growing
AI has been a major factor in both reducing our operating expenses and opening up new monetization fronts. In the second quarter, we ran intensive company-wide campaigns to drive rapid AI adoption and make our organization operate leaner, faster and better. We have also moved quickly to integrate AI into our dealer-facing products and services, where we are beginning to see early revenues and will continue to explore their full monetization potential. Looking ahead, we remain focused on the quality of growth, expanding monetization across our dealer-centric ecosystem, particularly opportunities created by AI applications, and continuing to improve profitability."
FINANCIAL RESULT DETAILS
Revenue
Revenue increased
Cost of Revenue
Cost of revenue increased
Operating Expenses
Total operating expenses were RMB302.5 million (US
Net Loss and Adjusted Net Loss (Non-GAAP)
Net loss was RMB240.5 million (US
Adjusted net loss (non-GAAP) narrowed
Balance Sheet and Liquidity
Liquidity strengthened following the Company’s IPO in June 2026, with cash and cash equivalents reaching RMB451.3 million (US
CONFERENCE CALL INFORMATION
The Company’s management will host two separate live video webcasts to discuss the financial results and recent business developments, with one session conducted in Chinese and the other in English. The Chinese- and English-language sessions will cover the same prepared content. To join the webcasts, participants must use the respective links below to complete an online registration process. Participants may join the session conducted in their preferred language.
Details of the live video webcasts are as follows:
Chinese Session
Date: August 26, 2026
Time: 5:00 A.M. Eastern Time (5:00 P.M. Beijing/Hong Kong Time on the same day)
Webcast link: https://us06web.zoom.us/webinar/register/WN_1ZVTr026QCWpjDgPQcYZyw
English Session
Date: August 26, 2026
Time: 8:00 A.M. Eastern Time (8:00 P.M. Beijing/Hong Kong Time on the same day)
Webcast link: https://us06web.zoom.us/webinar/register/WN_3w3A0GPFR0mrwkOWeHayGQ
The earnings release and related materials, including live and archived webcasts of both sessions, will be available on the Company's investor relations website at https://ir.dasouche.com.
ABOUT DSC
DSC is the AI application infrastructure for China’s used car industry. The Company has held over
SAFE HARBOR STATEMENT
This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties, and a number of factors could cause actual results to differ materially from those contained in any forward-looking statement. In some cases, forward-looking statements can be identified by words or phrases such as “may,” “will,” “expect,” “anticipate,” “target,” “aim,” “estimate,” “intend,” “plan,” “believe,” “potential,” “continue,” “is/are likely to”, or other similar expressions. Further information regarding these and other risks, uncertainties or factors is included in the Company’s filings with the SEC. All information provided in this announcement is as of the date of this announcement, and the Company does not undertake any duty to update such information, except as required under applicable law.
USE OF NON-GAAP FINANCIAL MEASURES
The Company uses adjusted loss, which is a non-GAAP financial measure, in evaluating its operating results and for financial and operational decision-making purposes. The Company believes that adjusted loss for the year provides useful information about its results of operations and enhances the overall understanding of its past performance and future prospects.
The Company defines non-GAAP financial measure by excluding the impact of share-based compensation expenses and amortization of intangible assets resulting from business combinations from the respective GAAP financial measure.
Adjusted loss should not be considered in isolation or construed as an alternative to loss from operations, net loss or any other measure of performance or as an indicator of the Company’s operating performance. Investors are encouraged to review adjusted loss for the year and the reconciliation to its most directly comparable U.S. GAAP measure. Other companies may calculate similarly titled measures differently, limiting their usefulness as comparative measures to the Company's data. The Company encourages investors and others to review its financial information in its entirety and not rely on a single financial measure.
Reconciliations of the Company’s non-GAAP financial measure to its most comparable U.S. GAAP measure are included at the end of this press release.
EXCHANGE RATE
This press release contains translations of certain RMB amounts into U.S. dollars (“USD”) at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to USD were made at the noon buying rates of RMB6.7851 to US
INVESTOR RELATIONS CONTACT
DSC IR Department
Email: ir@souche.com
The Blueshirt Group
Ms. Feifei Shen
Email: dsc@blueshirtgroup.co
| DSC HOLDINGS LTD. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Amounts in thousands of Renminbi (“RMB”) and US dollar (“US$”), except for share and per share data, unless otherwise noted) | |||||
| As of | As of June 30, 2026 | ||||
| December 31, 2025 | |||||
| RMB | RMB | US$ | |||
| (Unaudited) | (Unaudited) | ||||
| ASSETS | |||||
| Current assets: | |||||
| Cash and cash equivalents | 178,862 | 451,285 | 66,511 | ||
| Restricted cash | 1,147 | 1,147 | 169 | ||
| Short-term investments | 31,730 | 79,406 | 11,703 | ||
| Accounts receivable, net | 60,753 | 49,431 | 7,285 | ||
| Amounts due from related parties, current | 84,626 | 141,556 | 20,863 | ||
| Contract assets, net | 90,337 | 95,928 | 14,138 | ||
| Prepayments and other current assets, net | 154,566 | 130,231 | 19,194 | ||
| Total current assets | 602,021 | 948,984 | 139,863 | ||
| Non-current assets: | |||||
| Fixed assets, net | 3,571 | 2,772 | 409 | ||
| Long-term investments, net | 7,572 | 7,315 | 1,078 | ||
| Intangible assets, net | 64,408 | 69,050 | 10,177 | ||
| Right-of-use assets, net | 13,395 | 7,579 | 1,117 | ||
| Goodwill | 596,858 | 596,858 | 87,966 | ||
| Amounts due from related parties, non-current | 132,716 | 97,705 | 14,400 | ||
| Other non-current assets, net | 14,865 | 15,168 | 2,235 | ||
| Total non-current assets | 833,385 | 796,447 | 117,382 | ||
| Total assets | 1,435,406 | 1,745,431 | 257,245 | ||
| LIABILITIES, MEZZANINE EQUITY AND SHAREHOLDERS' EQUITY | |||||
| Current liabilities: | |||||
| Short-term loans | 121,274 | 217,356 | 32,034 | ||
| Accounts payable | 60,800 | 61,580 | 9,076 | ||
| Contract liabilities and customer advance | 51,170 | 53,455 | 7,878 | ||
| Amounts due to related parties, current | 2,004 | 233 | 34 | ||
| Operating lease liabilities, current | 4,823 | 3,270 | 482 | ||
| Accrued expenses and other current liabilities | 187,967 | 170,263 | 25,095 | ||
| Total current liabilities | 428,038 | 506,157 | 74,599 | ||
| Non-current liabilities: | |||||
| Amounts due to related parties, non-current | 282,998 | 263,694 | 38,864 | ||
| Operating lease liabilities, non current | 8,616 | 4,305 | 634 | ||
| Other non-current liabilities | 8,350 | 8,714 | 1,284 | ||
| Total non-current liabilities | 299,964 | 276,713 | 40,782 | ||
| Total liabilities | 728,002 | 782,870 | 115,381 | ||
| DSC HOLDINGS LTD. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED) (Amounts in thousands of Renminbi (“RMB”) and US dollar (“US$”), except for share and per share data, unless otherwise noted) | |||||
| As of | As of June 30,2026 | ||||
| December 31, 2025 | |||||
| RMB | RMB | US$ | |||
| (Unaudited) | (Unaudited) | ||||
| Mezzanine equity | |||||
| Preferred Shares | 16,538,315 | - | - | ||
| Shareholders' equity: | |||||
| Ordinary Shares | 123 | 712 | 105 | ||
| Additional paid-in capital | - | 18,032,457 | 2,657,655 | ||
| Accumulated deficit | (15,828,914) | (17,066,168) | (2,515,242) | ||
| Accumulated other comprehensive loss | (2,209) | (4,500) | (663) | ||
| Total DSC Holdings Ltd. shareholders’ (deficit)/equity | (15,831,000) | 962,501 | 141,855 | ||
| Noncontrolling interests | 89 | 60 | 9 | ||
| Total shareholders' (deficit)/equity | (15,830,911) | 962,561 | 141,864 | ||
| TOTAL LIABILITIES, MEZZANINE EQUITY AND SHAREHOLDERS' EQUITY | 1,435,406 | 1,745,431 | 257,245 | ||
| DSC HOLDINGS LTD. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Amounts in thousands of Renminbi (“RMB”) and US dollar (“US$”), except for share and per share data, unless otherwise noted) | |||||||||||
| For the Three Months Ended | For the Six Months Ended | ||||||||||
| June 30, 2025 | June 30, 2026 | June 30, 2026 | June 30, 2025 | June 30, 2026 | June 30, 2026 | ||||||
| RMB | RMB | US$ | RMB | RMB | US$ | ||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||
| Revenues | 161,104 | 167,047 | 24,620 | 303,840 | 313,619 | 46,222 | |||||
| Cost of revenues | (93,943) | (108,047) | (15,924) | (178,936) | (200,741) | (29,586) | |||||
| Gross profit | 67,161 | 59,000 | 8,696 | 124,904 | 112,878 | 16,636 | |||||
| Operating expenses: | |||||||||||
| General and administrative | (16,514) | (173,671) | (25,596) | (46,891) | (194,844) | (28,716) | |||||
| Sales and marketing | (51,062) | (92,096) | (13,573) | (97,604) | (134,224) | (19,782) | |||||
| Research and development | (24,196) | (36,767) | (5,419) | (48,106) | (52,979) | (7,808) | |||||
| Total operating expenses | (91,772) | (302,534) | (44,588) | (192,601) | (382,047) | (56,306) | |||||
| Operating loss | (24,611) | (243,534) | (35,892) | (67,697) | (269,169) | (39,670) | |||||
| Other (expenses)/income | |||||||||||
| Interest expense, net | (1,002) | (118) | (17) | (1,961) | (3,885) | (573) | |||||
| Foreign exchange income, net | 143 | 1,018 | 150 | 213 | 1,756 | 259 | |||||
| Others, net | 415 | 2,732 | 403 | 4,878 | 2,284 | 337 | |||||
| Total other (expenses)/ income, net | (444) | 3,632 | 536 | 3,130 | 155 | 23 | |||||
| Loss before income taxes | (25,055) | (239,902) | (35,356) | (64,567) | (269,014) | (39,647) | |||||
| Income tax expense | (187) | (695) | (102) | (368) | (936) | (138) | |||||
| Share of incomes from equity method investments | 214 | 109 | 16 | 323 | 220 | 32 | |||||
| Net loss | (25,028) | (240,488) | (35,442) | (64,612) | (269,730) | (39,753) | |||||
| Less: Net income (loss) attributable to noncontrolling interests | 900 | (3) | - | 13 | (29) | (4) | |||||
| Net loss attributable to DSC Holdings Ltd. | (25,928) | (240,485) | (35,442) | (64,625) | (269,701) | (39,749) | |||||
| Accretion of the Company`s preferred shares | (427,019) | (463,024) | (68,241) | (841,685) | (913,061) | (134,569) | |||||
| Net loss attributable to ordinary shareholders | (452,947) | (703,509) | (103,683) | (906,310) | (1,182,762) | (174,318) | |||||
| Loss per share: | |||||||||||
| Basic and diluted | (3.33) | (0.70) | (0.10) | (6.66) | (1.18) | (0.17) | |||||
| Weighted average shares: | |||||||||||
| Basic and diluted | 136,159,402 | 1,001,449,847 | 1,001,449,847 | 136,159,402 | 1,001,449,847 | 1,001,449,847 | |||||
| DSC HOLDINGS LTD. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (CONTINUED) (Amounts in thousands of Renminbi (“RMB”) and US dollar (“US$”), except for share and per share data, unless otherwise noted) | |||||||||||
| For the Three Months Ended | For the Six Months Ended | ||||||||||
| June 30, 2025 | June 30, 2026 | June 30, 2026 | June 30, 2025 | June 30, 2026 | June 30, 2026 | ||||||
| RMB | RMB | US$ | RMB | RMB | US$ | ||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||
| Other comprehensive loss, net of tax of nil: | |||||||||||
| Foreign currency translation adjustments | (201) | (1,141) | (168) | (304) | (2,291) | (338) | |||||
| Comprehensive loss | (25,229) | (241,629) | (35,610) | (64,916) | (272,021) | (40,091) | |||||
| Comprehensive income (loss) attributable to noncontrolling interests | 900 | (3) | - | 13 | (29) | (4) | |||||
| Comprehensive loss attributable to DSC Holdings Ltd. | (26,129) | (241,626) | (35,610) | (64,929) | (271,992) | (40,087) | |||||
| Accretion of preferred shares | (427,019) | (463,024) | (68,241) | (841,685) | (913,061) | (134,569) | |||||
| Comprehensive loss attributable to ordinary shareholders of DSC Holdings Ltd. | (453,148) | (704,650) | (103,851) | (906,614) | (1,185,053) | (174,656) | |||||
| Reconciliation of net loss to non-GAAP | |||||||||||
| Net Loss (GAAP) | (25,028) | (240,488) | (35,442) | (64,612) | (269,730) | (39,753) | |||||
| Amortization of intangible assets (1) | 5,820 | 5,756 | 848 | 11,402 | 11,496 | 1,694 | |||||
| Share-based compensation expenses were included in: | |||||||||||
| General and administrative | - | 159,472 | 23,503 | - | 159,472 | 23,503 | |||||
| Sales and marketing | - | 48,196 | 7,103 | - | 48,196 | 7,103 | |||||
| Research and development | - | 19,627 | 2,893 | - | 19,627 | 2,893 | |||||
| Adjusted net loss (non-GAAP) | (19,208) | (7,437) | (1,095) | (53,210) | (30,939) | (4,560) | |||||
(1)This represents amortization of intangible assets resulting from business combinations.
