Waterdrop Inc. Announces Fourth Quarter and Fiscal Year 2025 Unaudited Financial Results and Declares a Cash Dividend

BEIJING, March 25, 2026 /PRNewswire/ -- Waterdrop Inc. ("Waterdrop", the "Company" or "we") (NYSE: WDH), a leading technology platform dedicated to insurance and healthcare service with a positive social impact, today announced its unaudited financial results for the three and twelve months ended December 31, 2025 and a cash dividend.

Financial and Operational Highlights for the Fourth Quarter of 2025

Mr. Peng Shen, Founder, Chairman, and Chief Executive Officer of Waterdrop, commented, "2025 marked a year of renewed acceleration for Waterdrop, driven by the strategic integration of AI into our core operational infrastructure. This technological alignment has materially enhanced our operational efficiency and reinforced our competitive positioning.

In our insurance business, we achieved a 125.0% year-over-year surge in insurance-related income this quarter, driven by AI models that efficiently handle high-concurrency traffic and refine targeting as more data becomes available. To support this growth, we simultaneously expanded AI deployment across key insurance operations, enhancing efficiency and scalability. Premiums facilitated by 'AI Medical Insurance Expert' increased 145% on a quarter-over-quarter basis. 'AI Customer Service Agent' independently handled over 1.4 million customer inquiries within a single month. The rollout of 'AI Service Quality Copilot' drove per-capita inspection efficiency to 2.75 times that of the manual-only baseline. 'Waterdrop Sea.AI', our proprietary low-code AI application platform, completed the launch of its core modules and was used to deploy 'Xiao Bao AI Planner', an AI-powered insurance planner purpose-built for long-term protection products to enhance user response efficiency and advisor-matching precision.

Concurrently, we comprehensively upgraded the risk control system for Waterdrop Medical Crowdfunding. By deploying automated dynamic data masking to replace manual redaction, thereby mitigating the risk of data theft and accelerating reviews. Furthermore, we introduced a receipt verification model that integrates a Medical Knowledge Graph with credential validation. This model cross-references clinical logic, pharmacy qualifications, and other data to precisely root out fabricated receipts and effectively prevent fund misappropriation.

In our digital clinical trial business, we secured a national invention patent for China's first intelligent drug-patient matching technology. Capable of deeply interpreting complex medical records and trial protocols, our system enables high-precision, automated matching between patients and clinical trials. During the quarter, we collaborated with 224 pharmaceutical companies and contract research organizations. Patient enrollment for this quarter reached 1,273, driving a 39.9% year-over-year revenue increase.

As we approach our tenth anniversary in 2026, we remain steadfast in our commitment to consistent shareholder returns. By the end of February 2026, the Company had cumulatively repurchased approximately 60.7 million ADSs from the open market, for approximately US$118.1 million. We are also pleased to announce that, with the board approval, the Company will soon start another cash dividend of approximately US$10.8 million.

Looking ahead, the burgeoning AI landscape unlocks vast new possibilities for industry innovation. Waterdrop is poised to harness its technological advantages to further accelerate scale, fortify its competitive moat, and deliver sustainable long-term value to all stakeholders."

Financial Results for the Fourth Quarter of 2025

Operating revenue, net

Net operating revenue for the fourth quarter of 2025 reached RMB1,411.2 million (US$201.8 million), which represents a significant increase of 105.5% year-over-year from RMB686.8 million for the same period of 2024. On a quarter-over-quarter basis, net operating revenue grew by 44.8%.

Operating costs and expenses

Operating costs and expenses increased by 109.4% year-over-year to RMB1,327.4 million (US$189.8 million) for the fourth quarter of 2025. On a quarter-over-quarter basis, operating costs and expenses increased by 54.2%.

Operating profit for the fourth quarter of 2025 was RMB83.9 million (US$12.0 million), as compared with RMB53.0 million for the fourth quarter of 2024 and RMB113.8 million for the third quarter of 2025.

Interest income for the fourth quarter of 2025 was RMB34.8 million (US$5.0 million), as compared with RMB35.8 million for the fourth quarter of 2024 and RMB37.5 million for the third quarter of 2025.

Income tax benefit for the fourth quarter of 2025 was RMB41.7 million (US$6.0 million), as compared with income tax expense of RMB1.9 million for the fourth quarter of 2024 and income tax expense of RMB9.6 million for the third quarter of 2025.

Net profit attributable to the Company's ordinary shareholders for the fourth quarter of 2025 was RMB162.1 million (US$23.2 million), as compared with RMB99.6 million for the same period of 2024, and RMB158.5 million for the third quarter of 2025.

Adjusted net profit attributable to the Company's ordinary shareholders (non-GAAP ( 1)) for the fourth quarter of 2025 was RMB170.2 million (US$24.3 million), as compared with RMB107.1 million for the same period of 2024 and RMB167.7 million for the third quarter of 2025.

Financial Results for the Fiscal Year of 2025

Net operating revenue for the year of 2025 increased by 43.5% year-over-year to RMB3,977.8 million (US$568.8 million) from RMB2,771.8 million for the year of 2024, which was primarily due to the increase of insurance related income.

Operating costs and expenses

Operating costs and expenses increased by 39.1% year-over-year to RMB3,606.9 million (US$515.8 million) for the year of 2025, mainly due to the business expansion.

Operating costs increased by 47.8% year-over-year to RMB1,943.2 million (US$277.9 million) for the year of 2025, compared with RMB1,314.7 million for the year of 2024, which was primarily driven by (i) an increase of RMB461.7 million in costs of referral and service fees, (ii) an increase of RMB52.6 million in personnel costs, (iii) an increase of RMB42.2 million in SMS cost; (iv) an increase of RMB39.7 million in the costs for crowdfunding consultants team, and (v) an increase of RMB12.2 million in the costs for digital clinical trial solution consultants team.

Sales and marketing expenses increased by 61.3% year-over-year to RMB1,120.9 million (US$160.3 million) for the year of 2025, compared with RMB694.8 million for the year of 2024. The increase was primarily due to (i) an increase of RMB452.3 million in marketing expenses to third-party traffic channel, partially offset by (ii) a decrease of RMB11.4 million in sales and marketing personnel costs and share-based compensation expenses, and (iii) a decrease of RMB8.9 million in outsourced sales and marketing service fees to third parties.

General and administrative expenses decreased by 15.6% year-over-year to RMB310.1 million (US$44.3 million) for the year of 2024, compared with RMB367.7 million for the year of 2024. The year-over-year variance was due to (i) a decrease of RMB23.2 million in general and administrative personnel costs and share-based compensation expenses, (ii) a decrease of RMB9.5 million in the professional service fee, (iii) a RMB20.6 million impairment of intangible assets related to Shenlanbao recorded in the year of 2024, with no corresponding item in the year of 2025, and (iv) a decrease of RMB1.9 million in allowance for credit losses.

Research and development expenses increased by 7.5% year-over-year to RMB232.7 million (US$33.3 million) for the year of 2025, compared with RMB216.5 million for the year of 2024. The increase was primarily due to (i) an increase of RMB9.0 million in cloud server fees and other IT support expenses and (ii) an increase of RMB8.3 million in research and development personnel costs and share-based compensation expenses.

Operating profit for the year of 2025 was RMB370.9 million (US$53.0 million), compared with RMB178.2 million for the year of 2024.

Interest income for the year of 2025 was RMB135.7 million (US$19.4 million), compared with RMB149.1 million for the year of 2024.

Income tax benefit for the year of 2025 was RMB21.6 million (US$3.1 million), compared with income tax expense of RMB9.7 million for the year of 2024.

Net profit attributable to the Company's ordinary shareholders for the year of 2025 was RMB568.9 million (US$81.4 million), compared to RMB367.5 million for the year of 2024.

Adjusted net profit attributable to the Company's ordinary shareholders (non-GAAP ( 1)) for the year 2025 was RMB619.6 million (US$88.6 million), compared to RMB440.2 million for the year of 2024.

Cash position ( 2)

As of December 31, 2025, cash position of the Company was RMB3,249.0 million (US$464.6 million), as compared with RMB3,670.3 million as of December 31, 2024.

(1) See the sections entitled "Non-GAAP Financial Measure" and "Reconciliations of GAAP and Non-GAAP Results" for more information about the non-GAAP

measures referred to in this announcement.

(2) Cash position includes cash and cash equivalents, short-term investments, and long-term debt investments included in long-term investments.

Share Repurchase Programs

Pursuant to the share repurchase programs launched in September 2021, September 2022, September 2023, September 2024, and September 2025, respectively, we had cumulatively repurchased approximately 60.7 million ADSs from the open market with cash for a total consideration of approximately US$118.1 million as of February 28, 2026.

Cash Dividend

The Board has approved a cash dividend of US$0.03 per ADS or US$0.003 per ordinary share to shareholders of record as of the close of business on April 24, 2026. The aggregate amount of the dividend is expected to be approximately US$10.8 million. The payment date is expected to be on or around May 13, 2026, for holders of ordinary shares and on or around May 20, 2026, for holders of ADSs.

Supplemental Information

We organize and report our business in the following operating segments:

The table below sets forth the segment operating results, with three-month and twelve-month ended December 31, 2025.

For the Three Months Ended

For the Twelve Months Ended

December 31, 2024

September 30, 2025

December 31, 2025

December 31, 2024

December 31, 2025

RMB

USD

RMB

USD

(All amounts in thousands)

Operating revenue, net

Insurance

582,442

869,660

1,310,357

187,379

2,363,777

3,576,566

511,442

Crowdfunding

65,138

65,657

61,429

8,784

267,650

261,636

37,413

Others

39,244

39,543

39,462

5,643

140,394

139,559

19,957

Total consolidated operating revenue, net

686,824

974,860

1,411,248

201,806

2,771,821

3,977,761

568,812

Operating costs and expenses

Insurance

(479,856)

(693,216)

(1,164,229)

(166,483)

(1,886,572)

(2,931,662)

(419,222)

Crowdfunding

(87,147)

(98,771)

(96,722)

(13,831)

(362,734)

(392,311)

(56,100)

Others

(45,177)

(60,291)

(58,252)

(8,329)

(236,925)

(231,163)

(33,056)

Operating profit/(loss)

Insurance

102,586

176,444

146,128

20,896

477,205

644,904

92,220

Crowdfunding

(22,009)

(33,114)

(35,293)

(5,047)

(95,084)

(130,675)

(18,687)

Others

(5,933)

(20,748)

(18,790)

(2,686)

(96,531)

(91,604)

(13,099)

Total segment operating profit

74,644

122,582

92,045

13,163

285,590

422,625

60,434

Unallocated items*

(21,684)

(8,817)

(8,181)

(1,170)

(107,432)

(51,767)

(7,402)

Total consolidated operating profit

52,960

113,765

83,864

11,993

178,158

370,858

53,032

Total other income

40,443

54,331

36,538

5,225

182,432

172,591

24,679

Consolidated profit before income tax

93,403

168,096

120,402

17,218

360,590

543,449

77,711

* The share-based compensation represents unallocated items in the segment information because our management does not consider this as part of the segment operating performance measure.

Exchange Rate

This announcement contains translations of certain RMB amounts into U.S. dollars ("USD" or "US$") at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to USD were made at the rate of RMB6.9931 to US$1.00, the noon buying rate in effect on December 31, 2025 in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or USD amounts referred could be converted into USD or RMB, as the case may be, at any particular rate or at all. For analytical presentation, all percentages are calculated using the numbers presented in the financial statements contained in this earnings release.

Non-GAAP Financial Measure

The Company uses non-GAAP financial measure, adjusted net profit attributable to our ordinary shareholders, in evaluating the Company's operating results and for financial and operational decision-making purposes. Adjusted net profit attributable to our ordinary shareholders represents net profit attributable to our ordinary shareholders excluding share-based compensation expense attributable to our ordinary shareholders, foreign currency exchange gain or losses, impact of terminating the mutual aid plan, impairment of intangible assets acquired from business combination and related tax effects on non-GAAP adjustments.

The non-GAAP financial measure is not presented in accordance with U.S. GAAP and may be different from non-GAAP methods of accounting and reporting used by other companies. The non-GAAP financial measure has limitations as analytical tools and when assessing the Company's operating performance, investors should not consider it in isolation, or as a substitute for net loss or other consolidated statements of comprehensive loss data prepared in accordance with U.S. GAAP. The Company encourages investors and others to review its financial information in its entirety and not rely on a single financial measure. Investors are encouraged to review the Company's historical non-GAAP financial measure to the most directly comparable GAAP measure. Adjusted net profit attributable to our ordinary shareholders presented here may not be comparable to similarly titled measure presented by other companies. Other companies may calculate similarly titled measure differently, limiting its usefulness as a comparative measure to our data.

The Company mitigates these limitations by reconciling the non-GAAP financial measure to the most comparable U.S. GAAP performance measure, all of which should be considered when evaluating the Company's performance.

For more information on the non-GAAP financial measure, please see the table captioned "Reconciliation of GAAP and Non-GAAP Results" set forth at the end of this press release.

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. Waterdrop may also make written or oral forward-looking statements in its periodic reports to 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 Waterdrop'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: Waterdrop's mission, goals and strategies; Waterdrop's future business development, financial condition and results of operations; the expected growth of the insurance, medical crowdfunding and healthcare industry in China; Waterdrop's expectations regarding demand for and market acceptance of our products and services; Waterdrop's expectations regarding its relationships with consumers, insurance carriers and other partners; competition in the industry and relevant government policies and regulations relating to insurance, medical crowdfunding and healthcare industry. Further information regarding these and other risks is included in Waterdrop's filings with the SEC. All information provided in this press release is as of the date of this press release, and Waterdrop does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

Conference Call Information

Waterdrop's management team will hold a conference call on March 25, 2026 at 8:00 AM U.S. Eastern Time (8:00 PM Beijing/Hong Kong Time on the same day) to discuss the financial results. Dial-in details for the earnings conference call are as follows:

International:

1-412-317-6061

United States Toll Free:

1-888-317-6003

Hong Kong Toll Free:

800-963976

Hong Kong:

852-58081995

Mainland China:

4001-206115

Chinese Line (Mandarin) Entry Number:

1613336

English Interpretation Line (Listen-only Mode) Entry Number:

0047529

Participants can choose between the Chinese and the English interpretation lines. Please note that the English interpretation option will be in listen-only mode. Please dial in 15 minutes before the call is scheduled to begin and provide the Elite Entry Number to join the call.

Telephone replays will be accessible two hours after the conclusion of the conference call through April 1, 2026 by dialing the following numbers:

United States Toll Free:

1-855-669-9658

International:

1-412-317-0088

Chinese Line Access Code:

2333750

English Interpretation Line Access Code:

7366741

A live and archived webcast of the conference call will also be available at the Company's investor relations website at http://ir.waterdrop-inc.com/.

About Waterdrop Inc.

Waterdrop Inc. (NYSE: WDH) is a leading technology platform dedicated to insurance and healthcare service with a positive social impact. Founded in 2016, with the comprehensive coverage of Waterdrop Insurance Marketplace and Waterdrop Medical Crowdfunding, Waterdrop aims to bring insurance and healthcare service to billions through technology. For more information, please visit www.waterdrop-inc.com.

For investor inquiries, please contact

Waterdrop Inc.

[email protected]

WATERDROP INC.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(All amounts in thousands, unless otherwise noted)

As of

December 31, 2024

December 31, 2025

RMB

USD

Assets

Current assets

Cash and cash equivalents

986,323

483,003

69,069

Restricted cash

520,588

648,450

92,727

Short-term investments

1,612,619

530,668

75,885

Accounts receivable, net

716,206

1,260,464

180,244

Current contract assets

619,436

806,916

115,387

Amount due from related parties

257

209

Prepaid expense and other assets

182,641

251,084

35,905

Total current assets

4,638,070

3,980,794

569,247

Non-current assets

Non-current contract assets

153,749

295,516

42,258

Property, equipment and software, net

240,024

255,698

36,564

Intangible assets, net

153,011

177,140

25,331

Long-term investments

1,114,160

2,284,102

326,622

Right of use assets, net

46,872

23,955

3,426

Deferred tax assets

27,028

2,870

410

Goodwill

80,751

11,547

Total non-current assets

1,815,595

3,120,032

446,158

Total assets

6,453,665

7,100,826

1,015,405

Liabilities, Mezzanine Equity and Shareholders' Equity

Current liabilities

Amount due to related parties

10,616

9,324

1,333

Insurance premium payables

537,344

684,800

97,925

Accrued expenses and other current liabilities

704,035

1,140,448

163,082

Short-term loans

198,373

47,000

6,721

Current lease liabilities

34,573

10,888

1,557

Total current liabilities

1,484,941

1,892,460

270,618

Non-current liabilities

Non-current lease liabilities

10,971

12,640

1,807

Deferred tax liabilities

84,185

43,798

6,263

Total non-current liabilities

95,156

56,438

8,070

Total liabilities

1,580,097

1,948,898

278,688

Mezzanine Equity

Redeemable non-controlling interests

76,133

Shareholders' equity

Class A ordinary shares

112

116

Class B ordinary shares

Treasury stock

(15)

(16)

(2)

Additional paid-in capital

6,832,214

6,733,696

962,906

Accumulated other comprehensive income

159,550

43,622

6,238

Accumulated deficit

(2,194,453)

(1,625,517)

(232,446)

Total shareholders' equity

4,797,435

5,151,928

736,717

Total liabilities, mezzanine equity and shareholders' equity

6,453,665

7,100,826

1,015,405

WATERDROP INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

(All amounts in thousands, except for share and per share data, or otherwise noted)

For the Three Months Ended

For the Twelve Months Ended

December 31, 2024

September 30, 2025

December 31, 2025

December 31, 2024

December 31, 2025

RMB

USD

RMB

USD

Operating revenue, net

686,824

974,860

1,411,248

201,806

2,771,821

3,977,761

568,812

Operating costs and expenses (i)

Operating costs

(323,836)

(475,114)

(677,337)

(96,858)

(1,314,740)

(1,943,162)

(277,868)

Sales and marketing expenses

(182,038)

(242,962)

(506,786)

(72,469)

(694,769)

(1,120,929)

(160,291)

General and administrative expenses

(73,725)

(84,692)

(77,094)

(11,024)

(367,652)

(310,129)

(44,348)

Research and development expenses

(54,265)

(58,327)

(66,167)

(9,462)

(216,502)

(232,683)

(33,273)

Total operating costs and expenses

(633,864)

(861,095)

(1,327,384)

(189,813)

(2,593,663)

(3,606,903)

(515,780)

Operating profit

52,960

113,765

83,864

11,993

178,158

370,858

53,032

Other income

Interest income

35,802

37,537

34,812

4,978

149,121

135,697

19,404

Foreign currency exchange (loss)/gain

(963)

(388)

111

8,016

276

Others, net

5,604

17,182

1,615

231

25,295

36,618

5,236

Profit before income tax

93,403

168,096

120,402

17,218

360,590

543,449

77,711

Income tax (expense)/benefit

(1,936)

(9,630)

41,714

5,965

(9,707)

21,608

3,090

Net profit

91,467

158,466

162,116

23,183

350,883

565,057

80,801

Net loss attributable to mezzanine equity classified as non-controlling

interests shareholders

(8,148)

(16,627)

(3,879)

(555)

Net profit attributable to ordinary shareholders

99,615

158,466

162,116

23,183

367,510

568,936

81,356

Other comprehensive income:

Foreign currency translation adjustment, net of tax

89,187

(15,103)

(44,224)

(6,324)

44,773

(106,666)

(15,253)

Unrealized (loss)/gain on available for sale investments, net of tax

(29,330)

9,427

(17,530)

(2,507)

(29,330)

(9,262)

(1,324)

Total comprehensive income

151,324

152,790

100,362

14,352

366,326

449,129

64,224

Total comprehensive loss attributable to mezzanine equity classified as

non-controlling interests shareholders

(8,148)

(16,627)

(3,879)

(555)

Total comprehensive income attributable to ordinary

shareholders

159,472

152,790

100,362

14,352

382,953

453,008

64,779

Weighted average number of ordinary shares used in

computing net profit per share

Basic

3,620,987,566

3,619,786,490

3,612,924,848

3,650,504,339

3,615,328,154

Diluted

3,699,552,300

3,724,685,425

3,706,306,921

3,719,776,955

3,713,518,076

Net profit per share attributable to ordinary shareholders

Basic

0.03

0.04

0.01

0.10

0.16

0.02

Diluted

0.03

0.04

0.01

0.10

0.15

0.02

(i) Share-based compensation expenses are included in the operating costs and expenses as follows.

For the Three Months Ended

For the Twelve Months Ended

December 31, 2024

September 30, 2025

December 31, 2025

December 31, 2024

December 31, 2025

RMB

USD

RMB

USD

Sales and marketing expenses

(1,692)

(1,314)

(1,134)

(162)

(6,825)

(6,296)

(900)

General and administrative expenses

(17,336)

(6,940)

(6,531)

(934)

(69,245)

(40,897)

(5,848)

Research and development expenses

(2,656)

(563)

(516)

(74)

(10,802)

(4,574)

(654)

Total

(21,684)

(8,817)

(8,181)

(1,170)

(86,872)

(51,767)

(7,402)

WATERDROP INC.

RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS

(All amounts in thousands, unless otherwise noted)

For the Three Months Ended

For the Twelve Months Ended

December 31, 2024

September 30, 2025

December 31, 2025

December 31, 2024

December 31, 2025

RMB

USD

RMB

USD

Net profit attributable to the Company's ordinary shareholders

99,615

158,466

162,116

23,183

367,510

568,936

81,356

Add:

Share-based compensation expense attributable to the

Company's ordinary shareholders

21,502

8,817

8,181

1,170

86,449

50,892

7,277

Foreign currency exchange loss/(gain)

963

388

(111)

(16)

(8,016)

(276)

(39)

Impact of terminating the mutual aid plan (ii)

(14,985)

Impairment of intangible assets acquired from business

combination

12,336

Tax effects on non-GAAP adjustments

(3,084)

Adjusted net profit attributable to the Company's ordinary

shareholders

107,095

167,671

170,186

24,337

440,210

619,552

88,594

(ii) This represents the reversal of the difference between estimated cost of medical expense coverage and actual payment.

SOURCE Waterdrop Inc.