Exhibit 99.1
CHECHE GROUP INC.
INDEX TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| F-1 |
CHECHE GROUP INC.
UNAUDITED INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS
(All amounts in thousands, except for share and per share data)
| As of December 31, | As of June 30, | |||||||||
| Note | 2025 | 2026 | ||||||||
| RMB | RMB | |||||||||
| ASSETS | ||||||||||
| Current assets: | ||||||||||
| Cash and cash equivalents | ||||||||||
| Restricted cash | ||||||||||
| Short-term investments | ||||||||||
| Amounts due from related parties | 17 | |||||||||
| Accounts receivable, net | 3 | |||||||||
| Prepayments and other current assets | 4 | |||||||||
| Total current assets | ||||||||||
| Non-current assets: | ||||||||||
| Restricted cash | ||||||||||
| Property, equipment and leasehold improvement, net | 5 | |||||||||
| Intangible assets, net | 6 | |||||||||
| Right-of-use assets | 7 | |||||||||
| Goodwill | ||||||||||
| Other non-current assets | ||||||||||
| Total non-current assets | ||||||||||
| TOTAL ASSETS | ||||||||||
| LIABILITIES | ||||||||||
| Current liabilities | ||||||||||
| Accounts payable | ||||||||||
| Short-term borrowings | 8 | |||||||||
| Contract liabilities | 2 j) | |||||||||
| Salary and welfare benefits payable | ||||||||||
| Tax payable | 10 | |||||||||
| Amounts due to a related party | 17 | |||||||||
| Accrued expenses and other current liabilities | 11 | |||||||||
| Short-term lease liabilities | 7 | |||||||||
| Total current liabilities | ||||||||||
| Non-current liabilities | ||||||||||
| Deferred tax liabilities | ||||||||||
| Long-term lease liabilities | 7 | |||||||||
| Long-term borrowings | 8 | |||||||||
| Deferred revenue | 2 l) | |||||||||
| Warrant | 18 | |||||||||
| Total non-current liabilities | ||||||||||
| TOTAL LIABILITIES | ||||||||||
| Commitments and contingencies (Note 16) | ||||||||||
| F-2 |
CHECHE GROUP INC.
UNAUDITED INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED)
(All amounts in thousands, except for share and per share data)
| As of December 31, | As of June 30， | |||||||||
| Note | 2025 | 2026 | ||||||||
| RMB | RMB | |||||||||
| SHAREHOLDERS’ EQUITY: | ||||||||||
| Ordinary shares (US$ par value, and shares ( Class A ordinary shares and Class B ordinary shares) authorized as of December 31, 2025 and June 30, 2026, respectively; and shares ( Class A ordinary shares and Class B ordinary shares) issued as of December 31, 2025 and June 30, 2026, respectively; shares ( Class A ordinary shares and Class B ordinary shares) and shares ( Class A ordinary shares and Class B ordinary shares) outstanding as of December 31, 2025 and June 30, 2026, respectively)* | ||||||||||
| Treasury stock | ( | ) | ( | ) | ||||||
| Additional paid-in capital | ||||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||||
| Accumulated other comprehensive loss | ( | ) | ( | ) | ||||||
| TOTAL SHAREHOLDERS’ EQUITY: | ||||||||||
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||
| * |
The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.
| F-3 |
CHECHE GROUP INC.
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS AND COMPREHENSIVE LOSS
(All amounts in thousands, except for share and per share data)
| For the six months ended June 30, | ||||||||||
| Note | 2025 | 2026 | ||||||||
| RMB | RMB | |||||||||
| Net revenues | 12 | |||||||||
| Cost of revenues | 13 | ( | ) | ( | ) | |||||
| Gross profit | ||||||||||
| Operating expenses: | ||||||||||
| Selling and marketing expenses | ( | ) | ( | ) | ||||||
| General and administrative expenses | ( | ) | ( | ) | ||||||
| Research and development expenses | ( | ) | ( | ) | ||||||
| Total operating expenses | ( | ) | ( | ) | ||||||
| Operating loss | ( | ) | ( | ) | ||||||
| Other expenses: | ||||||||||
| Interest income | ||||||||||
| Interest expense | ( | ) | ( | ) | ||||||
| Foreign exchange gains | ||||||||||
| Government grants | ||||||||||
| Changes in fair value of warrant | ( | ) | ||||||||
| Changes in fair value of amounts due to related party | 17 | ( | ) | ( | ) | |||||
| Others, net | ( | ) | ( | ) | ||||||
| Loss before income tax | ( | ) | ( | ) | ||||||
| Income tax benefit | 9 | |||||||||
| Net loss | ( | ) | ( | ) | ||||||
| Other comprehensive loss | ||||||||||
| Foreign currency translation adjustments, net of nil tax | ( | ) | ( | ) | ||||||
| Fair value changes of amounts due to related party due to own credit Risk | 17 | ( | ) | |||||||
| Total other comprehensive loss | ( | ) | ( | ) | ||||||
| Total comprehensive loss | ( | ) | ( | ) | ||||||
| Comprehensive loss attributable to the Company’s ordinary shareholders | ( | ) | ( | ) | ||||||
| Net loss attributable to the Company’s ordinary shareholders per share* | ||||||||||
| Basic | ( | ) | ( | ) | ||||||
| Diluted | ( | ) | ( | ) | ||||||
| Weighted average number of ordinary shares* | ||||||||||
| Basic | ||||||||||
| Diluted | ||||||||||
| Share-based compensation expenses included in | ( | ) | ( | ) | ||||||
| Cost of revenues | ( | ) | ||||||||
| Selling and marketing expenses | ( | ) | ( | ) | ||||||
| General and administrative expenses | ( | ) | ( | ) | ||||||
| Research and development expenses | ( | ) | ( | ) | ||||||
| * |
The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.
| F-4 |
CHECHE GROUP INC.
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF
CHANGES IN SHAREHOLDERS’ EQUITY
(All amounts in thousands, except for share and per share data)
| Accumulated | ||||||||||||||||||||||||||||||||||
| Additional | other | Total | ||||||||||||||||||||||||||||||||
| Ordinary shares | Treasury stock | paid-in | comprehensive | Accumulated | shareholders’ | |||||||||||||||||||||||||||||
| Note | Shares* | Amount | Shares* | Amount | capital | income | deficit | equity | ||||||||||||||||||||||||||
| RMB | RMB | RMB | RMB | RMB | RMB | |||||||||||||||||||||||||||||
| Balance at January 1, 2025 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||
| Net loss | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||
| Share-based compensation | 14 a) | - | ||||||||||||||||||||||||||||||||
| Foreign currency translation adjustment | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||
| Fair value changes of amounts due to related party due to own credit risk | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||
| Balance at June 30, 2025 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||
| Accumulated | ||||||||||||||||||||||||||||||||||
| Additional | other | Total | ||||||||||||||||||||||||||||||||
| Ordinary shares | Treasury stock | paid-in | comprehensive | Accumulated | shareholders’ | |||||||||||||||||||||||||||||
| Note | Shares* | Amount | Shares* | Amount | capital | loss | deficit | equity | ||||||||||||||||||||||||||
| RMB | RMB | RMB | RMB | RMB | RMB | |||||||||||||||||||||||||||||
| Balance at January 1, 2026 | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Net loss | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||
| Share-based compensation | 14 a) | |||||||||||||||||||||||||||||||||
| Foreign currency translation adjustment | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||||
| Fair value changes of amounts due to related party due to own credit risk | - | - | ||||||||||||||||||||||||||||||||
| Balance at June 30, 2026 | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||
| * |
The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.
| F-5 |
CHECHE GROUP INC.
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(All amounts in thousands, except for share and per share data)
| For the six months ended June 30, | ||||||||
| 2025 | 2026 | |||||||
| RMB | RMB | |||||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| Cash flows from investing activities: | ||||||||
| Purchase of property, equipment and leasehold improvement | ( | ) | ( | ) | ||||
| Proceeds from disposal of property, equipment and intangible assets | ||||||||
| Placement of short-term investments | ( | ) | ||||||
| Cash received from maturities of short-term investments | ||||||||
| Net cash generated from/(used in) investing activities | ( | ) | ||||||
| Cash flows from financing activities: | ||||||||
| Cash received from short-term borrowings from bank (Note 8) | ||||||||
| Cash repayments of short-term borrowings from third party | ( | ) | ||||||
| Cash received from long-term borrowings from bank (Note 8) | ||||||||
| Cash repayments of short-term borrowings to bank (Note 8) | ( | ) | ( | ) | ||||
| Cash repayments of long-term borrowings to bank (Note 8) | ( | ) | ||||||
| Net cash generated from financing activities | ||||||||
| Effect of foreign exchange rate changes on cash and cash equivalents | ( | ) | ( | ) | ||||
| Net increase in cash and cash equivalents and restricted cash | ||||||||
| Cash and cash equivalents and restricted cash at beginning of the period | ||||||||
| Cash and cash equivalents and restricted cash at end of the period | ||||||||
| Reconciliation to amounts on consolidated balance sheet: | ||||||||
| Restricted cash at end of the period | ||||||||
| Cash and cash equivalents at end of the period | ||||||||
The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.
| F-6 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All amounts in thousands, except for share and per share data)
1. Organization and Principal Activities
Cheche Group Inc. (the “Company” or “Cheche Group”) was incorporated in the Cayman Islands in January 2023 as an exempted company with limited liability. The Company is a holding company and conducts its business mainly through its subsidiaries, variable interest entity Beijing Cheche Technology Co., Ltd. (“Beijing Cheche” or “VIE”) and subsidiaries of VIE (collectively referred to as the “Group”). Cheche Technology (Ningbo) Co., Ltd. (“Cheche Ningbo”) is wholly foreign-owned enterprise (the “WFOE”). The Group conducted its business in the People’s Republic of China (the “PRC” or “China”) through a series of contractual agreements entered into by the WFOE with the VIE based in China. The Group is primarily engaged in the operation of providing insurance transaction services, Software-as-a-Service (“SaaS”) and technical service and other services in China.
The following unaudited interim condensed consolidated financial information of the VIE after the elimination of inter-company transactions between the VIE and its subsidiaries as of December 31, 2025 and June 30, 2026 and for the six months ended June 30, 2025 and 2026 was included in the accompanying unaudited interim condensed consolidated financial statements of the Group as follows:
| As of December 31, | As of June 30, | |||||||
| 2025 | 2026 | |||||||
| RMB | RMB | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | ||||||||
| Restricted cash | ||||||||
| Short-term investment | ||||||||
| Accounts receivable, net | ||||||||
| Prepayments and other current assets | ||||||||
| Amounts due from intra-Group companies | ||||||||
| Total current assets | ||||||||
| Non-current assets: | ||||||||
| Property, equipment and leasehold improvement, net | ||||||||
| Intangible assets, net | ||||||||
| Right-of-use assets | ||||||||
| Goodwill | ||||||||
| Total non-current assets | ||||||||
| TOTAL ASSETS | ||||||||
| LIABILITIES | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | ||||||||
| Short-term borrowings | ||||||||
| Contract liabilities | ||||||||
| Salary and welfare benefits payable | ||||||||
| Tax payable | ||||||||
| Amounts due to related party | ||||||||
| Accrued expenses and other current liabilities | ||||||||
| Short-term lease liabilities | ||||||||
| Amounts due to intra-Group companies | ||||||||
| Total current liabilities | ||||||||
| Non-current liabilities: | ||||||||
| Deferred tax liabilities | ||||||||
| Long-term lease liabilities | ||||||||
| Deferred revenue | ||||||||
| Amounts due to intra-Group companies | ||||||||
| Total non-current liabilities | ||||||||
| TOTAL LIABILITIES (without recourse to the primary beneficiary) | ||||||||
| F-7 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
1. Organization and Principal Activities (Continued)
| For the six months ended | ||||||||
| June 30, | ||||||||
| 2025 | 2026 | |||||||
| RMB | RMB | |||||||
| Net revenues | ||||||||
| - earned from external parties | ||||||||
| - earned from intra-Group companies | ||||||||
| Total revenues | ||||||||
| Cost of revenues and operating expenses | ||||||||
| - arising from external parties transactions | ( | ) | ( | ) | ||||
| - arising from intra-Group transactions | ( | ) | ( | ) | ||||
| Total cost of revenues and operating expenses | ( | ) | ( | ) | ||||
| Net loss | ( | ) | ( | ) | ||||
| For the six months ended | ||||||||
| June 30, | ||||||||
| 2025 | 2026 | |||||||
| RMB | RMB | |||||||
| Cash flows from operating activities: | ||||||||
| Net cash (used in)/generated from transactions with intra-Group companies | ( | ) | ||||||
| Net cash generated from/(used in) transactions with external parties | ( | ) | ||||||
| Net cash (used in)/generated from operating activities | ( | ) | ||||||
| Net cash generated from/(used in) transactions with external parties | ( | ) | ||||||
| Net cash generated from/(used in) investing activities | ( | ) | ||||||
| Net cash used in transactions with intra-Group companies | ( | ) | ||||||
| Net cash generated from/(used in) transactions with external parties | ( | ) | ||||||
| Net cash generated from/(used in) financing activities | ( | ) | ||||||
| Net increase in cash and cash equivalents | ||||||||
Liquidity
The
Group has incurred recurring operating losses since its inception, including net loss of RMB
Historically,
the Group has relied principally on both operational sources of cash and non-operational sources of financing from investors to fund
its operations and business development. The Group’s ability to continue as a going concern is dependent on management’s
ability to successfully execute its business plan, which includes increasing revenues while controlling operating expenses, as well as,
generating operational cash flows and continuing to gain support from outside sources of financing. The Group had a positive working
capital (defined as total current assets deducted by total current liabilities) of RMB
| F-8 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
2 Significant Accounting Policies
a) Basis of presentation
The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information. Accordingly, they do not include all the information and footnotes required by U.S. GAAP for complete financial statements. Certain information and note disclosures normally included in the annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted consistent with Article 10 of Regulation S-X.
The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s financial position as of June 30, 2026 and the results of its operations and its cash flows for the six months ended June 30, 2025 and 2026. The results for the six months ended June 30, 2026 are not necessarily indicative of results to be expected for the year ending December 31, 2026, any other interim periods, or any future year or period. These unaudited interim condensed consolidated financial statements should be read in conjunction with the annual audited consolidated financial statements as of and for the year ended December 31, 2025 and notes thereto also included herein.
Significant accounting policies followed by the Group in the preparation of the accompanying unaudited interim condensed consolidated financial statements as of and for the six months ended June 30, 2026 and 2025 are summarized below.
b) Principles of consolidation
The unaudited interim condensed consolidated financial statements include the financial statements of the Company, its subsidiaries, the VIE and subsidiaries of VIE for which the Company is the primary beneficiary.
Subsidiaries are those entities in which the Company, directly or indirectly, controls more than one half of the voting power, has the power to appoint or remove the majority of the members of the board of directors, or to cast a majority of votes at the meeting of the board of directors, or has the power to govern the financial and operating policies of the investee under a statute or agreement among the shareholders or equity holders.
A consolidated VIE is an entity in which the Company, or its subsidiary, through contractual arrangements, has the power to direct the activities that most significantly impact the entity’s economic performance, bears the risks of and enjoys the rewards normally associated with ownership of the entity, and therefore the Company or its subsidiary is the primary beneficiary of the entity.
All transactions and balances among the Company, its subsidiaries, VIE and subsidiaries of VIE have been eliminated upon consolidation.
c) Use of estimates
The preparation of the Group’s unaudited interim condensed consolidated financial statements in conformity with the U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent liabilities at the balance sheet date and reported revenues and expenses during the reported periods in the unaudited interim condensed consolidated financial statements and accompanying notes. Significant accounting estimates include, but are not limited to, provision of current expected credit losses of receivables, the impairment of goodwill, fair value of amounts due to related party and warrant, as well as the valuation and recognition of share-based compensation expenses. Actual results could differ from those estimates, and as such, differences may be material to the unaudited interim condensed consolidated financial statements.
d) Functional currency and foreign currency translation
The Group uses Renminbi (“RMB”) as its reporting currency. The functional currency of the Company and its overseas subsidiaries which incorporated in the Cayman Islands and Hong Kong is United States dollars (“US$”). The functional currency of the Group’s PRC entities is RMB.
In the unaudited interim condensed consolidated financial statements, the financial information of the Company and other entities located outside of the PRC have been translated into RMB. Assets and liabilities are translated at the exchange rates on the balance sheet date, equity amounts are translated at historical exchange rates, and revenues, and expenses, gains and losses are translated using the average rate for the period. Translation adjustments are reported as foreign currency translation adjustments, and are shown as a component of other comprehensive loss in the unaudited interim condensed consolidated statements of operations and comprehensive loss.
Foreign currency transactions denominated in currencies other than the functional currency are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency using the applicable exchange rates at the balance sheet dates. Net gains and losses resulting from foreign exchange transactions are included in foreign exchange (losses)/gains in the unaudited interim condensed consolidated statements of operations and comprehensive loss.
| F-9 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
2. Significant Accounting Policies (Continued)
e) Fair value measurements
Accounting guidance defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Group considers the principal or most advantageous market in which it would transact and it considers assumptions that market participants would use when pricing the asset or liability.
Accounting guidance establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Accounting guidance establishes three levels of inputs that may be used to measure fair value:
● Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities
● Level 2 applies to assets or liabilities for which there are inputs other than quoted prices included within Level 1 that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical asset or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.
● Level 3 applies to asset or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.
The Group’s financial instruments include cash and cash equivalents, restricted cash, short-term investments, accounts receivable, other receivables (included in “prepayments and other current assets”), accounts payable, short-term borrowings, contract liabilities and other payables (included in “accrued expenses and other current liabilities”), of which the carrying values approximate their fair value. Lease liabilities are measured at amortized cost using discounted rates reflected time value of money.
f) Cash, cash equivalents and restricted cash
Cash
and cash equivalents mainly represent cash on hand, demand deposits placed with large reputable banks in China, and highly liquid investments
that are readily convertible to known amounts of cash and with original maturities from the date of purchase with terms of three months
or less. As of December 31, 2025 and June 30, 2026, there were cash at bank denominated in US dollars amounting to approximately US$
As
of December 31, 2025 and June 30, 2026, the Group had approximately RMB
g) Expected credit losses of receivables
The Group’s accounts receivable and other receivables (included in “prepayments and other current assets”) are within the scope of Accounting Standards Codification (“ASC”) 326. To estimate current expected credit losses, the Group has identified the relevant risk characteristics of its customers and the related receivables and other receivables which include size, type of the services the Group provides, or a combination of these characteristics.
Receivables with similar risk characteristics have been grouped into pools. For each pool, the Group considers the past collection experience, any changes in customer collection trends, the credit worthiness of customers, the contractual and customary payment terms that generally range from 30 to 180 days, current economic conditions, and expectation of future economic conditions (external data and macroeconomic factors). Accounts receivable balances are written off (i.e., charged-off against the allowance) when they are determined to be uncollectible after all means of collection have been exhausted and the potential for recovery is considered remote.
Accounts
receivable is recorded at the invoiced amount and do not bear interest. As of December 31, 2025 and June 30, 2026, the Group’s
accounts receivable consists primarily of receivables from insurance transaction services customers. The Group recorded current expected
credit loss expense of and RMB
| F-10 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
2. Significant Accounting Policies (Continued)
h) Impairment of long-lived assets
Long-lived assets or asset group, including intangible assets with finite lives, are evaluated for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be fully recoverable or that the useful life is shorter than the Group had originally estimated. When these events occur, the Group evaluates the impairment for the long-lived assets by comparing the carrying value of the assets to an estimate of future undiscounted cash flows expected to be generated from the use of the assets and their eventual disposition. If the sum of the expected future undiscounted cash flows is less than the carrying value of the assets, the Group recognizes an impairment loss based on the excess of the carrying value of the assets over the fair value of the assets. No impairment charge was recognized for any of the periods presented.
i) Warrant
The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of its financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 480 and FASB ASC Topic 815, “Derivatives and Hedging” (“ASC 815”). The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is assessed at the end of each reporting period. Accordingly, the Company recognizes the warrant instruments as liabilities at fair value and adjusts the warrants instruments to fair value at each reporting period. The liabilities are subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in the Company’s unaudited interim condensed consolidated statements of operations and comprehensive loss.
j) Revenue recognition
Revenue is the transaction price the Group expects to be entitled to in exchange for the promised services in a contract in the common course of the Group’s activities and is recorded net of value-added tax (“VAT”). The services to be accounted for mainly include insurance transaction services, SaaS and technical service and other services.
The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, the Group applies the following steps:
| ● | Step 1: Identify the contract(s) with a customer |
| ● | Step 2: Identify the performance obligations in the contract |
| ● | Step 3: Determine the transaction price |
| ● | Step 4: Allocate the transaction price to the performance obligations in the contract |
| ● | Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation |
Insurance Transaction Services Income
The main source of revenue is insurance transaction services fee directly from (i) insurance carriers who underwrite insurance policies and (ii) insurance intermediaries who directly transact with insurance carriers, both determined based on a percentage of premium paid by the insured. The service fee rate paid by the insurance carriers or insurance intermediaries, shall be based on the terms specified in the service contract with the insurance carriers or with the insurance intermediaries for each insurance policy sold through the Group’s online platform and mobile applications in the PRC. The Group determines that the insurance carrier or insurance intermediary, are its customer in these agreements. Insurance transaction services revenue for the commission earned is recognized at a point in time when the Company has fulfilled its performance obligation. This occurs when the signed insurance policy is in place and the premium is collected by the insurance carriers from the insured.
| F-11 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
2. Significant Accounting Policies (Continued)
j) Revenue recognition (Continued)
SaaS and technical service income
The Group provides SaaS services to selected insurance carriers or insurance intermediaries. This cloud-based services allow insurance carriers or insurance intermediaries to use the Group’s self-developed SaaS management system without taking possession of its software. The Group has determined that the insurance carriers or insurance intermediaries as customers and initially records services fee as contract liabilities upon receipt and then recognizes the revenue on a straight-line basis over the service period, which is usually one year.
The Group also provides technical service to third-party companies. The Group charges third-party companies service fee for developing software for them. Technical service revenue is recognized based on cost-to-cost input method of measuring progress upon the completion of each service.
Other Services
The Group provides automotive after-sales service to third-party companies or individual consumers. The Group satisfies its performance obligation through delivering automotive after-sales service and receives service fee from the third-party companies and individual consumers.
Contract Balances and Accounts Receivable
Contract liabilities primarily consist of customer advances which relates to the payments received for SaaS and technical service in advance of performance under the contract. The increase in contract liabilities over the periods presented was a result of the increase in consideration received from the Group’s customers, which was in line with the growth of revenues in SaaS and technical service. Due to the generally short-term duration of the relevant contracts, the majority of the performance obligations are satisfied within one year.
During
the six months ended June 30, 2025 and 2026, the Group recognized revenue amounted to RMB
During the six months ended June 30, 2025 and 2026, the Group did not have any arrangement where the performance obligations has already been satisfied in the past year but recognized the corresponding revenue in the current period.
Accounts receivable mainly represent amounts due from insurance transaction services customers, when the Group has satisfied its performance obligations and has the unconditional right to payment. They are carried at net realizable value. Please see Note 3 for additional information.
Practical Expedients
The Group has elected to use the following practical expedients as allowed under ASC Topic 606:
(i) Payment terms and conditions vary by contract type, although terms generally include a requirement of prepayment or payment within one year or less. The Group has determined that its contracts generally do not include a significant financing component.
(ii) Costs to obtain a contract with a customer were expensed as incurred when the amortization period would have been one year or less.
| F-12 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
2. Significant Accounting Policies (Continued)
k) Selling and marketing expenses
Selling and marketing expenses consist primarily of advertising and promotional expenses, salary and welfare benefits, share-based compensation expenses to the Group’s sales and marketing personnel, and amortization expenses. Advertising and promotional expenses consist primarily of costs for the promotion of corporate image, online platform and mobile applications. The Group expenses all advertising and promotional expenses as incurred and classifies them under selling and marketing expenses.
l) Government grants
Government grants mainly represent subsidies and tax refunds for operating a business in certain jurisdictions and fulfilment of specified tax payment obligations. Government grants are recognized where there is reasonable assurance that the grant will be received, and all attached conditions will be complied with. When the grant relates to an expense item, it is recognized as income on a systematic basis over the periods that the related costs, for which it is intended to compensate, are expensed. When the grant relates to an asset, it is recognized as income in equal amounts over the expected useful life of the related asset.
Deferred
government grants included RMB
m) Leases
The Group determines if an arrangement is a lease and determines the classification of the lease, as either operating or finance, at commencement. The Group has operating leases for office buildings and has no finance leases as of December 31, 2025 and June 30, 2026. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the lease payments over the lease term at commencement date.
As the Group’s leases do not provide an implicit rate, an incremental borrowing rate is used based on the information available at the commencement date, to determine the present value of lease payments. The incremental borrowing rate approximates the rate the Group would pay to borrow in the currency of the lease payments for the weighted-average life of the lease.
The operating lease ROU assets also include any lease payments made prior to lease commencement and exclude lease incentives and initial direct costs incurred if any. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Group will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term.
The Group’s lease agreements contain both lease and non-lease components, which are accounted for separately based on their relative standalone price.
The Company elect to utilize the short-term lease recognition exemption and, for those leases that qualified, the Group did not recognize operating lease right-of-use (“ROU”) assets or operating lease liabilities.
Share based compensation expenses arise from share-based awards, including share options for the purchase of ordinary shares and restricted shares. For share options for the purchase of ordinary shares granted to employee and non-employee determined to be equity classified awards, the related share-based compensation expenses are recognized in the unaudited interim condensed consolidated statements of operations and comprehensive loss based on their grant date fair values which are calculated using the binomial option pricing model. The determination of the fair value is affected by the fair value of ordinary shares as well as assumptions regarding a number of complex and subjective variables, including the expected volatility of the fair value of ordinary shares, actual and projected employee share option exercise behavior, risk-free interest rate and expected dividends. The fair value of the ordinary shares is assessed using the income approach, with a discount for lack of marketability, given that the shares underlying the awards were not publicly traded at the time of grant. Share-based compensation expenses are recorded net of estimated forfeitures using straight-line method during the service period requirement, such that expenses are recorded only for those share-based awards that are expected to ultimately vest.
| F-13 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
2. Significant Accounting Policies (Continued)
o) Taxation
Income taxes
Current income taxes are provided on the basis of income/(loss) for financial reporting purposes, adjusted for income and expense items which are not assessable or deductible for income tax purposes, in accordance with the regulations of the relevant tax jurisdictions. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and any tax loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates or tax laws is recognized in the unaudited interim condensed consolidated statements of operations and comprehensive loss in the period the change in tax rates or tax laws is enacted. A valuation allowance is provided to reduce the amount of deferred tax assets if it is considered more likely than not that some portion or all of the deferred tax assets will not be realized.
Uncertain tax positions
In
order to assess uncertain tax positions, the Group applies a more likely than not threshold and a two-step approach for the tax position
measurement and financial statement recognition. Under the two-step approach, the first step is to evaluate the tax position for recognition
by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained, including
resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that
is more than
| F-14 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
2. Significant Accounting Policies (Continued)
p) Related parties
Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject to common control or significant influence, such as a family member or relative, shareholder, or a related corporation.
Net loss per share is computed in accordance with ASC 260, Earnings per Share. The two-class method is used for computing earnings per share in the event the Group has net income available for distribution. Under the two-class method, net income is allocated between ordinary shares and participating securities based on dividends declared (or accumulated) and participating rights in undistributed earnings as if all the earnings for the reporting period had been distributed. For the periods presented herein, the computation of basic loss per share using the two-class method is not applicable as the Group is in a net loss position and net loss is not allocated to other participating securities because in accordance with their contractual terms they are not obligated to share in the losses.
Basic net loss per share is computed using the weighted average number of ordinary shares outstanding during the period. Diluted net loss per share is computed using the weighted average number of ordinary shares and potential ordinary shares outstanding during the period under treasury stock method. Potential ordinary shares include options to purchase ordinary shares and preferred shares, unless they were anti-dilutive. The computation of diluted net loss per share does not assume conversion, exercise, or contingent issuance of securities that would have an anti-dilutive effect (i.e. an increase in earnings per share amounts or a decrease in loss per share amounts) on net loss per share.
r) Comprehensive loss
Comprehensive loss is defined to include all changes in deficit of the Group during a period arising from transactions and other events and circumstances excluding transactions resulting from investments by shareholders and distributions to shareholders. Other comprehensive loss, as presented on the unaudited interim condensed consolidated balance sheets, consists of accumulated foreign currency translation adjustments and fair value changes of amounts due to related party due to own credit risk.
s) Segment reporting
The Group uses the management approach in determining reportable operating segments. The management approach considers the internal organization and reporting used by the Group’s chief operating decision maker (“CODM”) for making operating decisions, allocating resources and assessing performance as the source for determining the Group’s reportable segments. Management has determined that the Group operates in one segment, as that term is defined by FASB ASC Topic 280, Segment reporting.
| F-15 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
2.Significant Accounting Policies (Continued)
t) Recently issued accounting pronouncements
Recently adopted accounting pronouncements
In July 2025, the FASB issued ASU No. 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. ASU No. 2025-05 provides a practical expedient that permits an entity to assume that current economic conditions as of the balance sheet date do not change for the remaining life of the asset. Further, the ASU allows an entity, other than a public business entity, that elects the practical expedient to make an accounting policy election to consider collection activity after the balance sheet date when estimating expected credit losses. ASU 2025-05 is effective for the Company for annual periods beginning after December 15, 2025. The ASU is applied prospectively and early adoption is permitted. The Group adopted the new standard beginning January 1, 2026 and the impact of adopting the new standard was not material to its unaudited interim condensed consolidated financial statements.
Recent accounting pronouncements not yet adopted
In November 2024, the FASB issued ASU 2024-03, “Income Statement (Topic 220)—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40)”. ASU 2024-03 requires publicly-traded business entities to disclose specified information about the components of certain costs and expenses that are currently disclosed in the financial statements. The guidance is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. This guidance should be applied either prospectively to financial statements issued for reporting periods after the effective date or retrospectively to any or all prior periods presented in the financial statements. The Group is currently evaluating the potential impact this standard will have on its related disclosures to the consolidated financial statements.
In December 2025, the FASB issued ASU 2025-11 “Interim Reporting (Topic 270): Narrow Scope Improvements (“ASU 2025-11”), to improve the guidance for interim reporting and clarify when that guidance is applicable. The ASU 2025-11 provides a comprehensive list of required disclosures and also requires entities to disclose events since the last annual reporting period that have a material impact on the entity. ASU 2025-11 is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, for public business entities and for interim reporting periods within annual reporting periods beginning after December 15, 2028, for entities other than public business entities. Early adoption is permitted. The Group is currently evaluating ASU 2025-11 to determine its impact on the Company’s unaudited interim condensed consolidated financial statements.
| F-16 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
3. Accounts receivable, net
Accounts receivable, net consisted of the following:
| December 31, 2025 | June 30, 2026 | |||||||
| RMB | RMB | |||||||
| Accounts receivable, gross: | ||||||||
| Less: allowance for current expected credit losses | ( | ) | ( | ) | ||||
| Accounts receivable, net | ||||||||
The following table summarizes the movement of the Group’s allowance for current expected credit losses:
| For the six months ended June 30 | ||||||||
| 2025 | 2026 | |||||||
| RMB | RMB | |||||||
| Balance at the beginning of the period | ( | ) | ( | ) | ||||
| Additions | ( | ) | ||||||
| Write-offs | ||||||||
| Balance at the end of the period | ( | ) | ( | ) | ||||
| F-17 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
4. Prepayments and other current assets
The following is a summary of prepayments and other current assets:
| December 31, 2025 | June 30, 2026 | |||||||
| RMB | RMB | |||||||
| Deductible Value Added Tax (“VAT”) | ||||||||
| Staff advance (i) | ||||||||
| Service fees (ii) | ||||||||
| Rental and other deposits | ||||||||
| Others | ||||||||
| Balance at the end of the year | ||||||||
| (i) | |
| (ii) |
5. Property, equipment and leasehold improvement, net
The following is a summary of property, equipment and leasehold improvement, net:
| December 31, 2025 | June 30, 2026 | |||||||
| RMB | RMB | |||||||
| Leasehold improvement | ||||||||
| Furniture and office equipment | ||||||||
| Electronic equipment and others | ||||||||
| Total property, equipment and leasehold improvement | ||||||||
| Less: accumulated depreciation | ( | ) | ( | ) | ||||
| Property, equipment and leasehold improvement, net | ||||||||
Depreciation
expenses were RMB
| F-18 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
6. Intangible assets, net
The following table summarizes the Group’s intangible assets, net:
| December 31, 2025 | June 30, 2026 | |||||||
| RMB | RMB | |||||||
| Gross carrying amount | ||||||||
| Software | ||||||||
| Licenses | ||||||||
| Agency agreements | ||||||||
| Channel relationship | ||||||||
| Total intangible assets | ||||||||
| Less: accumulated amortization | ||||||||
| Software | ( | ) | ( | ) | ||||
| Licenses | ( | ) | ( | ) | ||||
| Agency agreements | ( | ) | ( | ) | ||||
| Channel relationship | ( | ) | ( | ) | ||||
| Total intangible assets, net | ||||||||
Amortization
expense for the six months ended June 30, 2025 and 2026 were RMB
The estimated amortization expenses for each of the following periods are as follows:
| June 30, 2026 | ||||
| RMB | ||||
| Remainder of 2026 | ||||
| 2027 | ||||
| Total | ||||
7. Leases
The Group’s lease payments for office space leases include fixed rental payments and do not consist of any variable lease payments that depend on an index or a rate. As of December 31, 2025 and June 30, 2026, there was no leases that have not yet commenced.
The following represents the aggregate right-of-use assets and related lease liabilities as of December 31, 2025 and June 30, 2026:
| December 31, 2025 | June 30, 2026 | |||||||
| RMB | RMB | |||||||
| Operating lease right-of-use assets | ||||||||
| Short-term operating lease liabilities | ( | ) | ( | ) | ||||
| Long-term operating lease liabilities | ( | ) | ( | ) | ||||
| Total operating leased liabilities | ( | ) | ( | ) | ||||
| F-19 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
7. Leases (Continued)
The weighted average lease term and weighted average discount rate as of December 31, 2025 and June 30, 2026 were as follows:
| December 31, 2025 | June 30, 2026 | |||||||
| RMB | RMB | |||||||
| Weighted average lease term: | ||||||||
| Operating leases | ||||||||
| Weighted average discount rate: | ||||||||
| Operating leases | % | % | ||||||
The components of lease expenses for the six months ended June 30, 2025 and 2026 were as follows:
| For the six months ended June 30, | ||||||||
| 2025 | 2026 | |||||||
| RMB | RMB | |||||||
| Operating lease cost | ||||||||
| Cost of other leases with period less than one year | ||||||||
| Total | ||||||||
Supplemental cash flow information related to leases for the six months ended June 30, 2025 and 2026 were as follows:
| For the six months ended June 30, | ||||||||
| 2025 | 2026 | |||||||
| RMB | RMB | |||||||
| Cash paid for amounts included in the measurement of lease liabilities: | ||||||||
| Operating cash flows for operating leases | ||||||||
| Supplemental noncash information: | ||||||||
| Right-of-use assets obtained in exchange for lease obligations | ||||||||
| Right-of-use assets released due to termination of lease contracts | ( | ) | ||||||
Maturities of lease liabilities at December 31, 2025 and June 30, 2026, respectively:
| December 31, 2025 | June 30, 2026 | |||||||
| RMB | RMB | |||||||
| 2026/Remainder of 2026 | ||||||||
| 2027 | ||||||||
| 2028 | ||||||||
| 2029 | ||||||||
| Total remaining undiscounted lease payments | ||||||||
| Less: interest | ( | ) | ( | ) | ||||
| Total present value of operating lease liabilities | ||||||||
| Less: short-term operating lease liabilities | ( | ) | ( | ) | ||||
| Long-term operating lease liabilities | ||||||||
| F-20 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
8. Short-term and long-term borrowings
The following table summarizes the Group’s outstanding short-term and long-term borrowings as of December 31, 2025 and June 30, 2026, respectively:
| December 31, 2025 | June 30, 2026 | |||||||
| RMB | RMB | |||||||
| Short-term bank borrowings | ||||||||
| Long-term bank borrowings | ||||||||
| Bank borrowings | ||||||||
Bank borrowings comprised of the followings:
| Maturity date | Principal amount | Interest rate per annum | December 31, 2025 | June 30, 2026 | ||||||||||||||
| China Minsheng Bank(i) | % | |||||||||||||||||
| China Minsheng Bank(i) | % | |||||||||||||||||
| Bank of Beijing(ii) | % | | ||||||||||||||||
| Bank of Beijing(ii) | % | |||||||||||||||||
| Industrial Bank(iii) | % | |||||||||||||||||
| Industrial and Commercial Bank of China(iv) | % | |||||||||||||||||
| Industrial and Commercial Bank of China(iv) | % | |||||||||||||||||
| Industrial and Commercial Bank of China(v) | % | |||||||||||||||||
| Bank of China(vi) | % | |||||||||||||||||
| Bank of China(vi) | % | |||||||||||||||||
| Bank of Shanghai(vii) | % | |||||||||||||||||
| Bank of Shanghai(viii) | % | |||||||||||||||||
| China CITIC Bank (ix) | % | |||||||||||||||||
| China CITIC Bank (ix) | % | |||||||||||||||||
| Bank of Beijing(x) | % | |||||||||||||||||
| Bank of Beijing(x) | % | |||||||||||||||||
| Bank of Beijing(x) | % | |||||||||||||||||
| Bank of Beijing(x) | % | |||||||||||||||||
| China Minsheng Bank(xi) | % | |||||||||||||||||
| China Minsheng Bank(xi) | % | |||||||||||||||||
| Industrial Bank(xii) | % | |||||||||||||||||
| Industrial and Commercial Bank of China （ⅹⅲ） | % | |||||||||||||||||
| Industrial and Commercial Bank of China （ⅹⅲ） | % | |||||||||||||||||
| Industrial and Commercial Bank of China （ⅹⅳ） | % | |||||||||||||||||
| Industrial and Commercial Bank of China （ⅹⅳ） | % | |||||||||||||||||
| Total Bank borrowings | ||||||||||||||||||
| (i) | |
| (ii) |
| F-21 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
| (iii) | |
| (iv) | |
| (v) | |
| (vi) | |
| (vii) | |
| (viii) | |
| (ix) | |
| (x) | |
| (xi) | |
| (xii) | |
| (xiii) | |
| (xiv) |
| F-22 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
9. Taxation
a) Income taxes
Cayman Islands
Under the current laws of the Cayman Islands, the Company is not subject to tax on income or capital gain. Additionally, upon payments of dividends by the Company in the Cayman Islands to its shareholders, no Cayman Islands withholding tax will be imposed.
Hong Kong
Subsidiary
incorporated in Hong Kong is subject to Hong Kong profits tax at a rate of
PRC
Under
the Enterprise Income Tax (“EIT”) Law of the PRC, the Company’s PRC subsidiaries, VIE and subsidiaries of VIE are subject
to an income tax of
The components of loss before income taxes are as follows (in thousands):
| For the six months ended June 30, | ||||||||
| 2025 | 2026 | |||||||
| RMB | RMB | |||||||
| Loss before income tax expense | ||||||||
| Loss from PRC operations | ( | ) | ( | ) | ||||
| Loss from non-PRC operations | ( | ) | ( | ) | ||||
| Total Loss before income tax expense | ( | ) | ( | ) | ||||
For the six months ended June 30, | For the six months ended June 30, | |||||||
| 2025 | 2026 | |||||||
| RMB | RMB | |||||||
| Current income tax expense | ||||||||
| PRC | ||||||||
| Non-PRC | ||||||||
| Total current income tax expense | ||||||||
| Deferred income tax benefit | ||||||||
| PRC | ( | ) | ( | ) | ||||
| Non-PRC | ||||||||
| Total deferred income tax benefit | ( | ) | ( | ) | ||||
| Total income tax benefit | ( | ) | ( | ) | ||||
| F-23 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
9. Taxation (Continued)
b) Withholding income tax
The
enterprise income tax (“EIT”) Law also imposes a withholding income tax of
To the extent that subsidiaries, VIE and subsidiaries of VIE of the Group have undistributed earnings, the Company will accrue appropriate expected withholding tax associated with repatriation of such undistributed earnings. As of December 31, 2025 and June 30, 2026, the Company did not record any such withholding tax of its subsidiaries, VIE and subsidiaries of VIE in the PRC as they are still in accumulated deficit position.
10. Tax payable
The
Group’s subsidiaries, VIE and subsidiaries of VIE incorporated in China are subject to
The following is a summary of tax payable as of December 31, 2025 and June 30, 2026:
| December 31, 2025 | June 30, 2026 | |||||||
| RMB | RMB | |||||||
| VAT payables | ||||||||
| Individual income tax payables | ||||||||
| Construction tax payables | ||||||||
| Educational development payables | ||||||||
| Others | ||||||||
| Total | ||||||||
11. Accrued expenses and other current liabilities
The following is a summary of accrued expenses and other current liabilities as of December 31, 2025 and June 30, 2026:
| December 31, 2025 | June 30, 2026 | |||||||
| RMB | RMB | |||||||
| Professional service fees | ||||||||
| Refund liability | ||||||||
| Accrued expenses | ||||||||
| Others | ||||||||
| Total | ||||||||
| F-24 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
12. Segment Information
Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker (“CODM”), or decision-making group, in deciding how to allocate resources and in assessing performance. The Company concluded that the Group’s CODM is Mr. Lei Zhang, Chairman of the Board of Directors, and CEO.
In
accordance with ASC 280-10, Segment Reporting: Overall, the CODM reviews the consolidated results of operations when making decisions
about allocating resources and assessing performance of the Group as a whole; hence, the Group has only
Key revenues streams are as below:
| For the six months ended June 30, | ||||||||
| 2025 | 2026 | |||||||
| RMB | RMB | |||||||
| Insurance transaction services income | ||||||||
| SaaS and technical service income | ||||||||
| Others | ||||||||
| Total | ||||||||
Substantially all revenues are derived in China where services are provided to customers. In addition, the Group’s long-lived assets are substantially all located in China. Therefore, no geographical segments are presented.
13. Cost of revenues
Amounts recorded as cost of revenues relate to direct expenses incurred in order to generate revenue, which consists primarily of cost of referral partners, service fee paid to third-party payment platforms, amortization and depreciation expenses, salary and welfare benefits, cloud service fees, tax and surcharges and others. These costs are charged to the unaudited interim condensed consolidated statements of operations and comprehensive loss as incurred. The following table presents the Group’s cost of revenue for the six months ended June 30, 2025 and 2026:
| For the six months ended | ||||||||
| June 30, | ||||||||
| 2025 | 2026 | |||||||
| RMB | RMB | |||||||
| Cost of referral partners | ||||||||
| Service fee paid to third-party payment platforms | ||||||||
| Salary and welfare benefits | ||||||||
| Amortization and depreciation expenses | ||||||||
| Cloud service fees | ||||||||
| Tax and surcharges and others | ||||||||
| Total | ||||||||
| F-25 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
(a) Description of stock option plan
2019 Incentive Plan
In January 2020, the Company permitted the grant of options and restricted shares to relevant directors, officers, senior management, employees and non-employees of the Group (the “2019 Incentive Plan”). Option awards are granted with an exercise price determined by the Board of Directors.
The stock options granted under the 2019 Incentive Plan have a contractual term of 10 years and will expire the earlier of (i) three months after termination of service with the Group, or (ii) upon the tenth anniversary of the grant date.
The stock options granted under the 2019 Incentive Plan will be immediately vested upon grant.
The restricted shares granted under the 2019 Incentive Plan could either be granted with terms that (i) immediately vested upon grant; (ii) % vested on each anniversary or % vested on each quarter for vesting schedule of four years; or (iii) % vested on each anniversary for vesting schedule of two years.
2023 Incentive Plan
In September 2023, the Company permitted the grant of options, restricted shares or any other type of awards to relevant directors, employees and non-employees of the Group (the “2023 Incentive Plan”). Option awards are granted with an exercise price determined by the Board of Directors.
In accordance with ASC 718 Stock Compensation, the Group recorded share-based compensation expense on the grant date of the equity interests to its employees equal to the estimated fair-value of such equity interests at the measurement date. The share-based compensation expense was recorded in cost of revenues, selling and marketing expenses, general and administrative expenses and research and development expenses on the unaudited interim condensed consolidated statements of operations and comprehensive loss.
Stock option replacement (the “Replacement”)
On
January 1, 2023 and July 1, 2023, a total of and vested options ( and options retrospectively
adjusted for effect of Share Consolidation in Note 15) were replaced by and restricted shares ( and
restricted shares retrospectively adjusted for effect of Share Consolidation in Note 15) of Cheche Technology Inc. (“CCT”),
a wholly owned subsidiary of the Company, which were converted into restricted shares of the Company upon the completion of the Reverse
Recapitalization. The restricted shares awards are subject to the original vesting schedule of the replaced share options. The Company
concluded the cancellation and replacement of awards is a modification, and determined the modification is a probable-to-probable (Type
I) modification. The Company has recognized the portion of incremental value of RMB
| F-26 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
14. Share-based compensation (Continued)
(b) Valuation assumptions
| For the six months ended | ||||||||
| June 30, | ||||||||
| Options | 2025 | 2026 | ||||||
| Fair value per share (US$)* | ~ | |||||||
| Discount rate (after tax) | Not applicable | Not applicable | ||||||
| Risk-free interest rate | %~% | % | ||||||
| Expected volatility | %~% | % | ||||||
| Contractual term (in years) | ||||||||
| Discount for lack of marketability (“DLOM”) | Not applicable | Not applicable | ||||||
| * |
The expected volatility at the grant date and each option valuation date was estimated based on the annualized standard deviation of the daily return embedded in historical share prices of comparable peer companies with a time horizon close to the expected expiry of the term of the options. The weighted average volatility is the expected volatility at the grant date weighted by number of options. The Company has never declared or paid any cash dividends on its shares, and the Group does not anticipate any dividend payments in the foreseeable future. The contractual term is the contract life of the options. The Group estimated the risk-free interest rate based on the market yield of US Government Bonds with maturities of ten years as of the valuation date, plus a country default risk spread between China and US.
| F-27 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
14. Share-based compensation (Continued)
(c) Stock options activities
| Weighted | ||||||||||||||||||||||||
| Weighted | average | |||||||||||||||||||||||
| Average | remaining | Aggregated | ||||||||||||||||||||||
| exercise | contractual | intrinsic | ||||||||||||||||||||||
| Number of Options Outstanding* | price* | life | value | |||||||||||||||||||||
| Employees | Consultant | Total | RMB in | |||||||||||||||||||||
| US$ | (in years) | thousands | ||||||||||||||||||||||
| Outstanding at January 1, 2025 | ||||||||||||||||||||||||
| Granted | - | |||||||||||||||||||||||
| Exercised | ( | ) | ( | ) | - | |||||||||||||||||||
| Forfeited | ( | ) | ( | ) | - | |||||||||||||||||||
| Outstanding at June 30, 2025 | ||||||||||||||||||||||||
| Exercisable as of June 30, 2025 | ||||||||||||||||||||||||
| Outstanding at January 1, 2026 | ||||||||||||||||||||||||
| Granted | - | |||||||||||||||||||||||
| Forfeited | ( | ) | ( | ) | - | |||||||||||||||||||
| Outstanding at June 30, 2026 | ||||||||||||||||||||||||
| Exercisable as of June 30, 2026 | ||||||||||||||||||||||||
| * |
The weighted average grant date fair value of options granted for the six months ended June 30, 2025 and 2026 were RMB (US$) (US$ per share retrospectively adjusted for effect of Share Consolidation) and RMB (US$) per option, respectively. and options were exercised for the six months ended June 30, 2025 and 2026.
| F-28 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
14. Share-based compensation (Continued)
(d) Restricted shares activities
The following table sets forth the summary of restricted share activities for the six months ended June 30, 2025 and 2026:
| Number of | Weighted-Average | |||||||
| Restricted | Grant Date | |||||||
| Shares Granted* | Fair Value* | |||||||
| (US$) | ||||||||
| Unvested as of January 1, 2025 | ||||||||
| Awarded | ||||||||
| Vested | ( | ) | ||||||
| Outstanding at June 30, 2025 | ||||||||
| Unvested as of January 1, 2026 | ||||||||
| Vested | ( | ) | ||||||
| Outstanding at June 30, 2026 | ||||||||
| * |
As retrospectively adjusted upon the Share Consolidation, there were and Class A ordinary shares, and Class B ordinary shares outstanding as of December 31, 2025 and June 30, 2026, respectively.
| F-29 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
15. Net loss per share (Continued)
| For the six months ended June 30, | ||||||||
| 2025 | 2026 | |||||||
| Numerator: | ||||||||
| Net loss | ( | ) | ( | ) | ||||
| Net loss attributable to the Company’s ordinary shareholders | ( | ) | ( | ) | ||||
| Denominator: | ||||||||
| Weighted average number of ordinary shares outstanding, basic (retrospectively adjusted for effect of the Share Consolidation)* | ||||||||
| Weighted average number of ordinary shares outstanding, diluted (retrospectively adjusted for effect of the Share Consolidation)* | ||||||||
| Basic net loss per share attributable to the Company’s ordinary shareholders | ( | ) | ( | ) | ||||
| Diluted net loss per share attributable to the Company’s ordinary shareholders | ( | ) | ( | ) | ||||
| * |
16. Commitments and Contingencies
(a) Commitments
The
Group leases office space under non-cancelable operating lease agreements, which expire at various dates through June 30, 2026. As of
December 31, 2025 and June 30, 2026, future minimum lease of RMB
(b) Litigation
As of December 31, 2025 and June 30, 2026, the Group was not involved in any legal or administrative proceedings that may have a material adverse impact on the Group’s business, financial position results of operations, or cash flows.
17. Related Party Balances and Transactions
The table below sets major related parties of the Group and their relationships with the Group:
| Entity or individual name | Relationship with the Group | |
| Fanhua Insurance Sales and Services Group Ltd. (“Fanhua Group”) | ||
| Mr. Lei Zhang |
| F-30 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
17. Related Party Balances and Transactions (Continued)
The outstanding balance due to related parties as of December 31, 2025 and June 30, 2026 were as follows:
| Balances with related parties | As of December 31, 2025 | As of June 30, 2026 | ||||||
| RMB | RMB | |||||||
| Amounts due to related parties | ||||||||
| Fanhua Group (i) | ||||||||
| Amounts due from related parties | ||||||||
| Mr. Lei Zhang (ii) | ||||||||
| Others | ||||||||
| Total | ||||||||
| (i) |
The
Group issued a convertible loan in the principal amount of RMB
In
2021, the Group repaid the aggregated principal amount of RMB
In
2023, the Group repaid the aggregated amount of RMB
In
2024, the Group repaid the aggregated principal of RMB
As
of June 30, 2026, the balance of the Corporate borrowings from Fanhua Group was RMB
The
Group elected fair value option to account for the Convertible Loan and the Corporate borrowings from Fanhua Group, and recognized loss/(gain)
under “Changes in fair value of amounts due to related party” and “Fair value changes of amounts due to related party
due to own credit risk” in the unaudited interim condensed consolidated statements of operations and comprehensive loss of RMB
The Group assessed the fair value of the Corporate borrowings at each end of reporting period. The fair value measurements of the Corporate borrowings are based on significant inputs not observable in the market, and thus represent Level 3 fair value measurements. The Group utilized the following assumptions to estimate the fair value of the Corporate borrowings:
| As of | As of | |||||||
| December 31, 2025 | June 30, 2026 | |||||||
| Discount rate | % | % | ||||||
| F-31 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
17. Related Party Balances and Transactions (Continued)
(i) Corporate borrowings from Fanhua Group (Continued)
The movement of Corporate borrowings from Fanhua Group is as follows:
| Corporate Borrowings | ||||
| RMB | ||||
| Balance as of January 1, 2025 | ||||
| Change in fair value | ||||
| Change in other comprehensive income | ||||
| Balance as of June 30, 2025 | ||||
| Balance as of January 1, 2026 | ||||
| Change in fair value | ||||
| Change in other comprehensive income | ( | ) | ||
| Balance as of June 30, 2026 | ||||
(ii) Amounts due from Mr. Lei Zhang
On
January 5, 2026, the Company entered into an advance funding agreement with Mr. Lei Zhang, to provide funds in an aggregate amount of
RMB
18. Fair Value Measurement
Assets and liabilities measured at fair value on a nonrecurring basis
As of December 31, 2025 and June 30, 2026, the Company had no financial assets or financial liabilities that are measured at fair value on non-recurring basis. The Company measured its non-financial assets, such as its property, equipment and leasehold improvements, intangible assets, goodwill on a nonrecurring basis whenever events or changes in circumstances indicate that the carrying value may no longer be recoverable.
Assets and liabilities measured at fair value on a recurring basis
The Company measured the Corporate borrowings from Fanhua Group and warrant at fair value on a recurring basis. As the Company’s Corporate borrowings from Fanhua Group and warrant are not traded in an active market with readily observable prices, the Company uses significant unobservable inputs to measure the fair value of the Corporate borrowings from Fanhua Group and warrant. They are categorized in the Level 3 valuation hierarchy based on the significance of unobservable factors in the overall fair value measurement. The Company did not transfer any assets or liabilities in or out of level 3 during the six months ended June 30, 2025 and 2026.
The following table summarizes the Company’s financial liabilities measured and recorded at fair value on recurring basis as of December 31, 2025 and June 30, 2026:
| As of December 31, 2025 | ||||||||||||||||
| Active Market | Observable Input | Unobservable Input | ||||||||||||||
| (Level 1) | (Level 2) | (Level 3) | Total | |||||||||||||
| RMB | RMB | RMB | RMB | |||||||||||||
| Liabilities: | ||||||||||||||||
| Warrant | ||||||||||||||||
| Corporate borrowings from Fanhua Group | ||||||||||||||||
| As of June 30, 2026 | ||||||||||||||||
| Active Market | Observable Input | Unobservable Input | ||||||||||||||
| (Level 1) | (Level 2) | (Level 3) | Total | |||||||||||||
| RMB | RMB | RMB | RMB | |||||||||||||
| Liabilities: | ||||||||||||||||
| Warrant | ||||||||||||||||
| Corporate borrowings from Fanhua Group | ||||||||||||||||
| F-32 |
CHECHE GROUP INC.
NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
(All amounts in thousands, except for share and per share data)
18. Fair Value Measurement (Continued)
Warrant
The fair value of the warrants converted from Prime Impact are measured based on the listed market price of such warrant, a Level 1 measurement. The fair value of the warrants converted from CCT are measured based on binomial option pricing model, a Level 3 measurement. Management is responsible for determining the fair value and assessing a number of factors. The valuation involves complex and subjective judgements as well as the Company’s best estimates on the valuation date. Key inputs related to the binomial option pricing model for the valuation of the fair value of warrants are: expiry date of warrant, fair market value per share as of valuation date, exercise price, risk free rate of interest, dividend yield, expected time to exercise as well as volatility.
Corporate borrowings from Fanhua Group
The Group classified the Corporate borrowings from Fanhua Group as current liability and measured at fair value. The Group classifies the valuation techniques that use fair value of the principle as Level 3 of fair value measurements. Generally, there are no quoted prices in active markets and other inputs that are directly or indirectly observable in the marketplace for the Corporate borrowings from Fanhua Group during the period at the reporting date. In order to determine the fair value, the Group must use the discounted cash flow method and earning forecast as unobservable inputs other than quoted prices in active markets, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
19. Subsequent Events
On
September 9, 2026, the Company entered into a non-binding term sheet in connection with a proposed strategic investment in Long Way Fortune
(“Target”), a residential solar-plus-storage business with operations currently in Australia and Singapore. The term sheet
contemplates an initial 20% minority investment in the Target with the potential for the Company to increase its ownership interest in
the Target to up to 51% over time, subject to agreed conditions and performance milestones. The transaction will be a stock-for-stock
investment in the Target at an overall implied equity value of US$
| F-33 |