Financial and Operational Highlights for the First Quarter of 2026
Strong Core Business Growth: Net operating revenue for the first quarter rose to RMB1,242.2 million (US$180.1 million), representing a 64.8% year-over-year increase. Insurance-related income for the quarter reached RMB1,145.8 million (US$166.1 million), up 74.1% from the same period in 2025.
Year-Over-Year Operating Profit Improvement: In the first quarter of 2026, operating profit was RMB80.0 million (US$11.6 million), representing a 5.3% year-over-year increase.
Expanded Scale of Medical Crowdfunding: As of March 31, 2026, around 494 million people have cumulatively donated an aggregate of RMB73.5 billion to 3.75 million patients through Waterdrop Medical Crowdfunding.
Continued Expansion in Patient Enrollment: As of March 31, 2026, the Company had cumulatively enrolled 15,512 patients into 1,718 clinical trial programs through the E-Find Platform.
Mr. Peng Shen, Founder, Chairman, and Chief Executive Officer of Waterdrop, commented, "2026 marks Waterdrop's tenth anniversary. We opened the year with a solid first-quarter result, underpinned by rapid top-line growth.
For our insurance business, we deepened R&D investment to strengthen our traffic infrastructure and user acquisition capabilities. Insurance-related income rose 74.1% year-over-year. On the product side, we aim to bring insurance within reach for more people through inclusive underwriting and affordable pricing. Premiums for pre-existing condition insurance increased 24.3% year-over-year. We also launched 'Shouhu Ruchu,' a competitively priced cancer plan with metastasis coverage and optional recurrence benefits.
Our AI deployment continued to enhance operational efficiency. First-year premiums facilitated by our user-facing 'AI Insurance Expert' increased by 17.7% quarter-over-quarter. Our KEYI.AI underwriting assistant has processed more than 10,000 inquiries to date. To further empower our consultants, we launched 'Claw Copilot,' an application built into our CRM system that integrates KEYI.AI, product knowledge base, and a suite of additional AI tools to provide real-time support during customer interactions.
During this quarter, we upgraded our AI-assisted risk screening framework for Waterdrop Medical Crowdfunding, improving the speed and consistency of campaign intake and initial screening. We also streamlined localized risk operations by integrating multilingual risk specialists and culturally attuned review workflows, while maintaining strict compliance.
In our digital clinical trial business, the E-Find platform leverages proprietary patented technology to match and recommend patients for innovative drug clinical trials based on structured medical records. In the first quarter, we partnered with 243 pharmaceutical companies and contract research organizations and enrolled 957 patients. Revenue from digital clinical trial solutions was approximately RMB24.2 million, up 5.4% year-over-year.
As part of our ongoing shareholder return program, as of May 31, 2026, we had repurchased approximately 61.8 million ADSs for about US$120.1 million, and recently paid a cash dividend of approximately US$10.8 million.
As we look to the future, we remain dedicated to the enduring purpose that has shaped our journey since day one. In 2026, we aim to move faster toward becoming an AI-native company to strengthen execution and support durable value for our users and shareholders."
Financial Results for the First Quarter of 2026
Operating revenue, net
Net operating revenue for the first quarter of 2026 reached RMB1,242.2 million (US$180.1 million), which represents an increase of 64.8% year-over-year from RMB753.7 million for the same period of 2025. On a quarter-over-quarter basis, net operating revenue decreased by 12.0%.
Insurance-related income includes insurance brokerage income and technical service income. Insurance brokerage income represents brokerage commissions earned from insurance companies. Technical service income is derived from providing analytics and intelligent recommendation service, risk assessment technical service, customer relationship management ("CRM") system-based technical services and marketing services to insurance companies, insurance brokers, and agency companies. Reinforced by cumulative big data, we provide risk assessment technical services through algorithm-driven verification system assessing risk by analyzing user profiles and medical history, tagging risk levels for hierarchical management that help insurers refine their risk analysis capabilities since 2025. We leverage multi-dimensional consumer insights to deliver analytics and intelligent recommendation services, enabling policyholders to be matched with more suitable products and improving sales efficiency. Our insurance-related income amounted to RMB1,145.8 million (US$166.1 million) in the first quarter of 2026, representing an increase of 74.1% year-over-year from RMB658.0 million for the first quarter of 2025, which was mainly due to the increase in technical service income. Our technical service income amounted to RMB421.0 million (US$61.0 million) in the first quarter of 2026, compared with RMB9.4 million for the same quarter of 2025. On a quarter-over-quarter basis, insurance-related income decreased by 12.6%, due to the decrease in technical service income.
Crowdfunding service fees represent the service income earned when patients successfully withdraw the proceeds from their crowdfunding campaigns. Our role is to operate the Waterdrop Medical Crowdfunding platform to provide crowdfunding related services through the internet, enabling patients with significant medical bills to seek help from caring hearts through technology (the "medical crowdfunding services"). Our medical crowdfunding services generally consist of providing technical and internet support, managing, reviewing and supervising the crowdfunding campaigns, providing comprehensive risk management and anti-fraud measures, and facilitating the collection and transfer of the funds. For the first quarter of 2026, we generated RMB60.7 million (US$8.8 million) in service fees, representing a decrease of 9.5% from RMB67.1 million for the first quarter of 2025. On a quarter-over-quarter basis, crowdfunding service fees slightly decreased by 1.1%.
Digital clinical trial solution income represents the service income earned from our customers mainly including biopharmaceutical companies and leading biotechnology companies. We match qualified and suitable patients for enrollment in clinical trials for our customers and generate digital clinical trial solution revenue for successful matches and we typically charge our customers a fixed unit price per successful match. For the first quarter of 2026, our digital clinical trial solution income amounted to RMB24.2 million (US$3.5 million), representing an increase of 5.4% from RMB23.0 million in the same period of 2025. On a quarter-over-quarter basis, digital clinical trial solution income decreased by 32.2%.
Operating costs and expenses
Operating costs and expenses increased by 71.5% year-over-year to RMB1,162.3 million (US$168.5 million) for the first quarter of 2026. On a quarter-over-quarter basis, operating costs and expenses decreased by 12.4%.
Operating costs increased by 30.1% year-over-year to RMB486.8 million (US$70.6 million) for the first quarter of 2026, as compared with RMB374.2 million for the first quarter of 2025, which was primarily driven by (i) an increase of RMB53.9 million in costs of referral and service fees, (ii) an increase of RMB38.9 million in the costs for short message service (SMS) costs for new user onboarding and authentication processes; and (iii) an increase of RMB7.3 million in personnel costs. On a quarter-over-quarter basis, operating costs decreased by 28.1% from RMB677.3 million, primarily due to (i) a decrease of RMB201.9 million in costs of referral and service fees, partially offset by (ii) an increase of RMB12.3 million in the costs for SMS.
Sales and marketing expenses increased by 213.8% year-over-year to RMB541.1 million (US$78.4 million) for the first quarter of 2026, as compared with RMB172.4 million for the same quarter of 2025. The increase was primarily due to an increase of RMB361.4 million in marketing expenses for third-party traffic channels. On a quarter-over-quarter basis, sales and marketing expenses increased by 6.8% from RMB506.8 million, primarily due to an increase of RMB29.4 million in marketing expenses for third-party traffic channels.
General and administrative expenses decreased by 4.3% year-over-year to RMB71.7 million (US$10.4 million) for the first quarter of 2026, as compared with RMB74.9 million for the same quarter of 2025. On a quarter-over-quarter basis, general and administrative expenses decreased by 7.0% from RMB77.1 million, due to a decrease of RMB6.5 million in professional service fees.
Research and development expenses increased by 11.5% year-over-year to RMB62.7 million (US$9.1 million) for the first quarter of 2026, as compared with RMB56.2 million for the same period of 2025, which was primarily driven by an increase of RMB6.7 million in cloud server fees and other IT support expenses. On a quarter-over-quarter basis, research and development expenses decreased by 5.2% from RMB66.2 million. The decrease was primarily due to (i) a decrease of RMB4.3 million in personnel costs and share-based compensation expenses, partially offset by (ii) an increase of RMB1.2 million in cloud server fees and other IT support expenses.
Operating profit for the first quarter of 2026 was RMB80.0 million (US$11.6 million), as compared with RMB75.9 million for the first quarter of 2025 and RMB83.9 million for the fourth quarter of 2025.
Interest income for the first quarter of 2026 was RMB29.1 million (US$4.2 million), as compared with RMB33.8 million for the first quarter of 2025 and RMB34.8 million for the fourth quarter of 2025.
Income tax expense for the first quarter of 2026 was RMB6.8 million (US$1.0 million), as compared with income tax expense of RMB13.3 million for the first quarter of 2025 and income tax benefit of RMB41.7 million for the fourth quarter of 2025.
Net profit attributable to the Company's ordinary shareholders for the first quarter of 2026 was RMB98.4 million (US$14.3 million), as compared with RMB108.2 million for the same period of 2025, and RMB162.1 million for the fourth quarter of 2025.
Adjusted net profit attributable to the Company's ordinary shareholders (non-GAAP(1)) for the first quarter of 2026 was RMB106.3 million (US$15.4 million), as compared with RMB130.0 million for the same period of 2025 and RMB170.2 million for the fourth quarter of 2025.
Cash position(2)
As of March 31, 2026, cash position of the Company was RMB2,880.7 million (US$417.6 million), as compared with RMB3,249.0 million as of December 31, 2025.
(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 61.8 million ADSs from the open market with cash for a total consideration of approximately US$120.1 million as of May 31, 2026.
Supplemental Information
We organize and report our business in the following operating segments:
Insurance, which mainly includes insurance brokerage service and technical service;
Crowdfunding, which mainly includes crowdfunding service; and
Others, which do not individually or in the aggregate meet the quantitative and qualitative thresholds to be individually reportable and are aggregated.
The table below sets forth the segment operating results, with three-month ended March 31, 2026.
For the Three Months Ended
March 31, 2025
December 31, 2025
March 31, 2026
RMB
RMB
RMB
USD
(All amounts in thousands)
Operating revenue, net
Insurance
657,988
1,310,357
1,145,790
166,105
Crowdfunding
67,131
61,429
60,729
8,804
Others
28,575
39,462
35,729
5,179
Total consolidated operating revenue, net
753,694
1,411,248
1,242,248
180,088
Operating costs and expenses
Insurance
(506,575)
(1,164,229)
(992,834)
(143,931)
Crowdfunding
(97,299)
(96,722)
(96,786)
(14,031)
Others
(54,000)
(58,252)
(64,721)
(9,383)
Operating profit/(loss)
Insurance
151,413
146,128
152,956
22,174
Crowdfunding
(30,168)
(35,293)
(36,057)
(5,227)
Others
(25,425)
(18,790)
(28,992)
(4,204)
Total segment operating profit
95,820
92,045
87,907
12,743
Unallocated items*
(19,927)
(8,181)
(7,954)
(1,152)
Total consolidated operating profit
75,893
83,864
79,953
11,591
Total other income
41,690
36,538
27,258
3,952
Consolidated ...
