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Share-based Compensation | 12 Months Ended
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Dec. 31, 2024
Share-based Payment Arrangement [Abstract] |
Share-based Compensation |
17. | Share-based Compensation
a) | Description of share option and RSUs plans
In July 2014, the Group adopted its Global Share Incentive Plan (the “Global Share Plan”), which permits the grant of options of the Company to relevant directors, officers, other employees and consultants of the Group. The maximum aggregate number of Class Z Ordinary Shares, which may be issued pursuant to all awards under the Global Share Plan, is 19,880,315 shares. The Global Share Plan was terminated on the Primary Conversion Effective Date. In February 2018, the Group adopted its 2018 Share Incentive Plan (the “2018 Plan”) to provide additional incentives to employees, directors and consultants and promote the success of its business. The maximum aggregate number of Class Z Ordinary Shares, which may be issued pursuant to all awards under the 2018 Plan as at December 31, 2024 is 33,132,989 shares. As at the date on which the voluntary conversion of its secondary listing status to primary listing on the Hong Kong Stock Exchange becomes effective , the Group subsequently amended its 2018 Plan, under which the maximum aggregate number of Class Z ordinary shares may be issued pursuant to all awards is 30,673,710 Class Z ordinary shares, representing 10% of the total number of issued Class Z ordinary shares, which permits the grant of restricted share units (“RSUs”) of the Company to relevant directors, officers, other employees and consultants of the Group. In June 2024, the Group adopted its Second Amended and Restated 2018 Share Incentive Plan (the “Restated 2018 Plan”) to provide additional incentives to employee participants, related entity participants and service provider participants and promote the success of its business. The maximum aggregate number of Class Z Ordinary Shares, which may be issued pursuant to all awards under the 2018 Plan as at December 31, 2024 is 41,413,503 shares, and within the Scheme Limit, the maximum number of Class Z Ordinary Shares which may be issued pursuant to all awards to be granted to service provider participants under the Restated 2018 Plan is 2,070,675. In May 2024, the Group adopted its 2024 Share Incentive Plan (the “2024 Plan”) to provide additional incentives to employee participants, related entity participants and consultants and promote the success of its business. The maximum aggregate number of Class Z Ordinary Shares, which may be issued pursuant to all awards under the 2024 Plan as at December 31, 2024 is 41,272,920 shares. No awards have been granted under the 2024 Share Incentive Plan since its adoption. Option awards are granted with an exercise price determined by the Board of Directors. Those option awards generally vest over a period of zero to six years and expire in six to seven years, and RSUs generally vest over a period of zero to six years. RSUs The following table presents a summary of the Group’s service-based RSUs activities for the years ended December 31, 2022, 2023 and 2024:
|  | Employees |  |  | Consultants |  |  | Total |  |  | Weighted Average Granted fair value |
|  | (In thousands) |  |  | (In thousands) |  |  | (In thousands) |  |  | US$ |
Outstanding at January 1, 2022 |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Granted |  |  | 1,932 |  |  |  | 35 |  |  |  | 1,967 |  |  |  | 24.59 |
Vested |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Forfeited |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Unvested at December 31, 2022 |  |  | 1,932 |  |  |  | 35 |  |  |  | 1,967 |  |  |  | 24.59 |
Outstanding at January 1, 2023 |  |  | 1,932 |  |  |  | 35 |  |  |  | 1,967 |  |  |  | 24.59 |
Granted |  |  | 8,796 |  |  |  | — |  |  |  | 8,796 |  |  |  | 18.72 |
Vested |  |  | — |  |  |  | (23 | ) |  |  | (23 | ) |  |  | 24.59 |
Forfeited |  |  | (1,059 | ) |  |  | — |  |  |  | (1,059 | ) |  |  | 22.10 |
Unvested at December 31, 2023 |  |  | 9,669 |  |  |  | 12 |  |  |  | 9,681 |  |  |  | 19.53 |
Outstanding at January 1, 2024 |  |  | 9,669 |  |  |  | 12 |  |  |  | 9,681 |  |  |  | 19.53 |
Granted |  |  | 10,841 |  |  |  | 1 |  |  |  | 10,842 |  |  |  | 17.14 |
Vested |  |  | (689 | ) |  |  | (12 | ) |  |  | (701 | ) |  |  | 24.59 |
Forfeited |  |  | (2,547 | ) |  |  | — |  |  |  | (2,547 | ) |  |  | 17.37 |
Unvested at December 31, 2024 |  |  | 17,274 |  |  |  | 1 |  |  |  | 17,275 |  |  |  | 18.14 |
The aggregate number of Class Z Ordinary Shares available for future grant under the Restated 2018 Plan was 37,092,680 as of December 31, 2024. The aggregate number of Class Z Ordinary Shares available for future grant under the 2024 Plan was 41,272,920 as of December 31, 2024. As of December 31, 2024, total unrecognized compensation expenses related to unvested service-based RSUs granted under the 2018 Plan and the Restated 2018 Plan, adjusted for estimated forfeitures, was RMB1,652.5 million, which is expected to be recognized over a weighted-average period of 3.6 years and may be adjusted for future changes in estimated forfeitures. Share options
b) | Valuation assumptions
The Group uses binomial option pricing model to determine the fair value of share options. The estimated fair value of each share option granted is estimated on the date of grant using the binomial option-pricing model with the following assumptions:
|  | For the Year Ended December 31, |
|  | 2022 |  |  | 2023* |  |  | 2024* |
Expected volatility |  |  | 57.6%-58.0 | % |  |  | N/A |  |  |  | N/A |
Weighted average volatility |  |  | 57.9 | % |  |  | N/A |  |  |  | N/A |
Expected dividends |  |  | — |  |  |  | N/A |  |  |  | N/A |
Risk-free rate |  |  | 2.7%-3.6 | % |  |  | N/A |  |  |  | N/A |
Contractual term (in years) |  |  | 6-7 |  |  |  | N/A |  |  |  | N/A |
* | No further options would be granted under the 2018 Share Incentive Plan after the Primary Conversion Effective Date.
The expected volatility at each grant 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 share options. The weighted average volatility is the expected volatility at the grant date weighted by the number of the share options. The Company has never declared or paid any cash dividends on its capital stock, and the Company does not anticipate any dividend payments in the foreseeable future. Contractual term is the remaining contract life of the share options. The Group estimated the risk-free interest rate based on the yield to maturity of U.S. treasury bonds denominated in US dollars at the share option grant date.
(c) | Share options activities
The following table presents a summary of the Group’s share options activities for the years ended December 31, 2022, 2023 and 2024:
|  | Employees |  |  | Consultants |  |  | Total |  |  | Weighted Average Exercise Price |  |  | Weighted Average Remaining Contractual Life |  |  | Aggregate Intrinsic Value |
|  | (In thousands) |  |  | (In thousands) |  |  | (In thousands) |  |  | US$ |  |  | (In years) |  |  | (RMB in thousands) |
Outstanding at January 1, 2022 |  |  | 22,327 |  |  |  | 183 |  |  |  | 22,510 |  |  |  | 2.0010 |  |  |  | 5.01 |  |  |  | 6,372,503 |
Granted |  |  | 5,667 |  |  |  | 162 |  |  |  | 5,829 |  |  |  | 0.0036 |  |  |  |  |  |  |  |  |
Exercised |  |  | (3,779 | ) |  |  | (150 | ) |  |  | (3,929 | ) |  |  | 0.0001 |  |  |  |  |  |  |  |  |
Forfeited |  |  | (2,500 | ) |  |  | — |  |  |  | (2,500 | ) |  |  | 0.2331 |  |  |  |  |  |  |  |  |
Outstanding at December 31, 2022 |  |  | 21,715 |  |  |  | 195 |  |  |  | 21,910 |  |  |  | 2.0283 |  |  |  | 4.70 |  |  |  | 3,305,336 |
Outstanding at January 1, 2023 |  |  | 21,715 |  |  |  | 195 |  |  |  | 21,910 |  |  |  | 2.0283 |  |  |  | 4.70 |  |  |  | 3,305,336 |
Granted |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  |  |  |  |  |  |
Exercised |  |  | (2,147 | ) |  |  | (64 | ) |  |  | (2,211 | ) |  |  | 0.0001 |  |  |  |  |  |  |  |  |
Forfeited |  |  | (1,760 | ) |  |  | — |  |  |  | (1,760 | ) |  |  | 0.1443 |  |  |  |  |  |  |  |  |
Outstanding at December 31, 2023 |  |  | 17,808 |  |  |  | 131 |  |  |  | 17,939 |  |  |  | 2.4701 |  |  |  | 3.79 |  |  |  | 1,232,411 |
Outstanding at January 1, 2024 |  |  | 17,808 |  |  |  | 131 |  |  |  | 17,939 |  |  |  | 2.4701 |  |  |  | 3.79 |  |  |  | 1,232,411 |
Granted |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  |  |  |  |  |  |
Exercised |  |  | (3,689 | ) |  |  | (7 | ) |  |  | (3,696 | ) |  |  | 0.3911 |  |  |  |  |  |  |  |  |
Forfeited |  |  | (1,119 | ) |  |  | (14 | ) |  |  | (1,133 | ) |  |  | 0.6909 |  |  |  |  |  |  |  |  |
Outstanding at December 31, 2024 |  |  | 13,000 |  |  |  | 110 |  |  |  | 13,110 |  |  |  | 1.6543 |  |  |  | 2.85 |  |  |  | 1,550,782 |
Exercisable at December 31, 2024 |  |  | 6,897 |  |  |  | 76 |  |  |  | 6,973 |  |  |  | 1.8474 |  |  |  | 2.64 |  |  |  | 907,766 |
The weighted average grant date fair value of share options granted for the year 2022 was RMB126.8 per share. No further options would be granted under the 2018 Share Incentive Plan after the Primary Conversion Effective Date. As of December 31, 2024, total unrecognized compensation expenses related to unvested options granted under the Global Share Plan and the 2018 Plan, adjusted for estimated forfeitures, was RMB1,176.8 million, which is expected to be recognized over a weighted-average period of 1.9 years and may be adjusted for future changes in estimated forfeitures.

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