Key Highlights

● Second-quarter 2026 revenue rose 3.7% to RMB167.0 million.

● Adjusted net loss narrowed 61.5% to RMB7.4 million on a non-GAAP basis.

● The reported net loss widened to RMB240.5 million on RMB227.8 million of listing-related charges.

● The June IPO priced 3 million ADSs at US$17, raising about US$51 million.

Latest verified development

DSC Holdings Ltd (NASDAQ:DSC), a China-based provider of software and transaction services for used-car dealers, reported unaudited second-quarter 2026 results on 26 August 2026, its first earnings release since listing on Nasdaq in June. Revenue for the quarter ended 30 June was RMB167.0 million (US$24.6 million), up 3.7% from RMB161.1 million a year earlier. Gross profit fell to RMB59.0 million from RMB67.2 million because cost of revenue rose 15.0%.

The reported net loss widened to RMB240.5 million (US$35.4 million) from RMB25.0 million. The company attributed the increase mainly to RMB227.8 million of share-based compensation and IPO-related expenses recognised in June 2026. On an adjusted, non-GAAP basis, the net loss narrowed 61.5% to RMB7.4 million. The company provided no guidance. Its chief financial officer described revenue growth as broadly in line with the company's expectations, although the release did not report gross merchandise value, a metric associated with marketplace-style businesses.

The listing

DSC priced 3 million American depositary shares at US$17, the midpoint of a US$16 to US$18 range, raising about US$51 million before costs. Existing shareholders reportedly indicated interest in roughly US$30 million of the offering. Deutsche Bank, China International Capital Corporation and CR Global Markets acted as joint bookrunners. The ADSs began trading on Nasdaq on 25 June 2026.

Business model and financial context

The company's flagship platform, Da Feng Che, is largely free to dealers and combines enterprise-resource-planning, customer-relationship and inventory tools. Most revenue comes from transaction services such as vehicle sourcing, inspection, logistics and warehousing. At the end of 2025 it reported about 228,000 active users and 30,297 monetised dealers and brokers.

The second-quarter release used a narrower definition, reporting 9,146 monetised used-car dealerships with average revenue per user of RMB6,672 and 214,451 monetised transaction services averaging RMB259 each. The company cautioned that these used-car-only metrics are not directly comparable with earlier periods. Revenue growth was attributed mainly to accepted projects for original-equipment-manufacturer customers, which points to a widening customer base beyond dealers, although the release did not quantify that contribution or separate it from the dealer business.

Longer-term history is less favourable. Annual revenue was RMB677.1 million in 2025, down 28.6% from RMB948.2 million in 2024, with net losses in each of the last five years. Cash and cash equivalents stood at RMB451.3 million (US$66.5 million) at 30 June 2026.

Gross profit, OEM revenue and the first full quarters as a listed company

Gross profit fell by RMB8.2 million even as revenue rose by RMB5.9 million, so the cost line, up 15.0%, is the main question left by the quarter. The OEM projects that drove growth are not broken out from the dealer business, and with no guidance issued, the next quarterly release will be the first chance to see whether gross profit stabilises.

The gap between the RMB240.5 million reported loss and the RMB7.4 million adjusted loss is almost entirely the RMB227.8 million of one-off share-based compensation and IPO-related expenses, which will not recur once the June listing costs fall away.