Waterdrop reported second-quarter net operating revenue of RMB1.45 billion ($213.4 million), representing a 72.8% year-over-year increase as its insurance business expanded and the company deployed AI across sales, underwriting and other services.
Insurance-related income increased 80.5% to RMB1.33 billion ($196.5 million), while operating profit increased 14.3% year over year and 39.2% sequentially to RMB111.3 million ($16.4 million).
Waterdrop said refinement of its AI models contributed to a 32.3% sequential increase in new customers acquired. Premiums facilitated by its AI Medical Insurance Expert increased 25.6% sequentially, its KEYI.AI underwriting assistant has processed more than 13,000 inquiries, and users served by its AI Super Pre-Sales Assistant increased nearly 50% sequentially.
Technical service income increased to RMB488 million ($71.9 million) from RMB160.9 million a year earlier. Waterdrop uses data and algorithms to provide risk assessment, recommendations and other technology services to insurers, brokers and agencies.
The company’s medical crowdfunding platform had facilitated approximately RMB74.7 billion of cumulative donations from roughly 499 million people to 3.82 million patients as of June 30.
Its E-Find digital clinical-trial platform had facilitated enrollment of 17,052 patients across 1,873 clinical trial programs. During the second quarter alone, Waterdrop worked with 255 pharmaceutical companies and contract research organizations and enrolled 1,540 patients.
Net profit attributable to ordinary shareholders was RMB125.8 million ($18.5 million), compared with RMB140.2 million a year earlier. Adjusted net profit was RMB135.5 million, or approximately $20 million.
Waterdrop also authorized its sixth share repurchase program, allowing the company to repurchase up to $50 million of ADSs through September 10, 2027. Since 2021, Waterdrop has repurchased approximately 62.9 million ADSs for $121.3 million.
The board also approved a cash dividend of $0.03 per ADS, representing an expected aggregate distribution of approximately $10.8 million.
KEY QUOTES:
“We are pleased to report another quarter of accelerating growth and strengthening profitability. Our AI initiatives continued to translate into tangible operating leverage.
We delivered solid results in insurance business, with an 80.5% year-over-year growth and a 16.4% quarter-over-quarter growth in insurance-related income. Continued refinement of our AI models improved conversion efficiency, leading to a 32.3% sequential increase in the number of new customers acquired. Expanding access to insurance protection remains our core product strategy. During the quarter, we introduced ‘Rongyi Bao,’ the market’s first long-term critical illness insurance product that requires no health disclosure and offers five-year guaranteed renewability. Together with our deepening insights into evolving user needs, these efforts translated into premium growth, with long-term premiums up 33.4% quarter-over-quarter.
AI is becoming the foundational layer powering how we sell and serve. Our AI deployment continued to enhance service efficiency and operational quality across our insurance business. In this quarter, premiums facilitated by our ‘AI Medical Insurance Expert’ rose by 25.6% sequentially. Our ‘KEYI.AI‘ underwriting assistant has processed more than 13,000 inquiries to date. The number of users served by ‘AI Super Pre-Sales Assistant’ climbed by nearly 50% sequentially.
Our AI-powered risk controls for Medical Crowdfunding resulted in marked improvement this quarter. As part of our risk review system, a new asset verification cross-references documents, medical records, and user-generated content to assess the possibility of undisclosed assets, such as property and vehicles, or unreported sources of income, and flags potential inconsistencies across the information reviewed.
Within our digital clinical trial business, the E-Find Platform delivered notably strong performance, especially in the chronic disease area. In the second quarter, we partnered with 255 pharmaceutical companies and contract research organizations and enrolled 1,540 patients. Revenue from digital clinical trial solutions was approximately RMB35.2 million, up 26.8% year-over-year.
Underscoring the commitment to shareholder returns, the board of directors of the Company (the “Board”) has authorized the Company’s sixth share repurchase program. Since the initial program launched in 2021, we had repurchased approximately 62.9 million ADSs for US$121.3 million as of August 31, 2026. We are also pleased to announce that, the Board has approved our sixth cash dividend of approximately US$10.8 million.
Waterdrop has always regarded technology as our core driver. With AI embedded across our platforms, we are well positioned to capture the growing demand in our existing businesses. Meanwhile, we continue to incubate new AI-driven business initiatives targeting global markets. We remain committed to delivering greater value for our shareholders in the years to come.”
Peng Shen, Founder, Chairman and Chief Executive Officer of Waterdrop
