Hello, and thank you for standing by for Energy Monster's 2022 first quarter earnings conference call. At this time, all participants are in a listen only mode. After management's prepared remarks, there will be a question and answer session. Today's conference is being recorded. If you have any objections, you may disconnect at this time. I'd like to turn the meeting over to your host for today's conference call, Director of Investor Relations, Hansen Shi. Thank you. Please go ahead.
Thank you. Welcome to our 2022 first quarter earnings conference call. Joining me on the call today are Mars Cai, Energy Monster Chairman and Chief Executive Officer, and Maria Yi Xin, Chief Financial Officer. For today's agenda, management will discuss business updates, operation highlights, and financial performance for the first quarter of 2022. Before we continue, I refer you to our safe harbor statement in the earnings press release, which will apply to this call as we will make forward-looking statements. Also, this call includes discussion of certain non-GAAP financial measures. Please refer to our earnings release, which contains a reconciliation of non-GAAP measures to the most directly comparable GAAP measures. Finally, please note that unless otherwise stated, all figures mentioned during this conference call are in RMB.
I would now like to turn the call over to our Chairman and Chief Executive Officer, Mars Cai, for the business and operation.
Thank you, Hansen. Good day, everyone. Welcome to our 2022 first quarter earnings call. The first quarter of 2022 has been a challenging quarter for Energy Monster. In light of the continuous outbreak of COVID in regions such as Shenzhen, Beijing, Tianjin, Hangzhou, and Changchun throughout the quarter, and especially due to the significantly worse than expected outbreaks in Shanghai starting mid-March, which radiated towards our region, other regions. For example, the outbreak in Tianjin in January resulted in a 67% decline in revenues within the city. During the 15 days period after the initial case, Hangzhou's January outbreak resulted in a 58% decline. Shenzhen in March, 51%. Changchun's March outbreak, 86%. An outbreak in Shanghai starting mid-March resulted in a 70% decline in March.
The frequency and size of the COVID outbreaks in the first quarter of 2022 is increasing compared to 2021. These COVID outbreaks resulted in a significant decline in offline foot traffic as people are more likely to stay at home, and offline locations are forced to close due to lockdown measures. The outbreaks are resulting in a general decline in offline user foot traffic across the board, negatively impacting almost all brands with an offline presence. These outbreaks continue to adversely affect the foot traffic to offline POIs in both regions of the outbreak and surrounding regions as well, which in turn results in lower foot traffic to POIs where our cabinets are placed. During the first quarter of this year, same-store revenue decreased by approximately 35% YoY as a result of the general decrease of foot traffic.
Despite the impact, we continue to stay long-term oriented and focus on laying the groundwork for expanding our market leadership. We continue to make strides in expanding our POI network, which reached 861,000 as of the end of the first quarter of 2022, increasing by over 20% YoY. With the increase in coverage, our service becomes available to more customers across China. Cumulative registered users reached 299 million as of the end of the first quarter, implying the acquisition of 12 million new registered users and increasing by over 25% YoY. We also continue to reduce both fixed and variable incentive fees to better mitigate against fluctuations in revenue resulting from COVID outbreaks. Notably, incentive fees as a percentage of revenue for new signings continue to trend down in light of diminishing competition.
Lower incentive fees and decrease in usage of fixed incentive fees will eventually help us lower our blended incentive fee rates and decrease the impact of exterior events such as COVID outbreaks on our operation. While we continue to be impacted by COVID, we remain confident in the long-term development of the market. The general demand of our service remains unchanged as regions coming out of COVID impact quickly recover within one to two months after containment. That's why we continue to uphold a long-term perspective in terms of our core strategies during COVID. We will continue increasing our POI network coverage through both our direct and network partner models, as well as launching innovative ways for the two models to work together to further expand our market presence. We also continue to innovate to increase our market-leading efficiency.
Programs such as our power bank optimization program and the launch of our new generation of cabinets will unlock our asset efficiency capabilities. We are confident that our innovative initiatives will further help us both cement our competitive advantage and capture the growth of China's mobile device charging service industry. Now, let me walk you through our core strategies in coverage and efficiency. First is the coverage of our service. We continue to expand the coverage of our service through a combination of our direct operation and network partner models. Our POI coverage and our user base continues to increase despite the headwinds set forth by COVID outbreaks. In terms of direct operation model, our BD personnel continue to spearhead our coverage expansion primarily in higher tier cities.
During COVID, the expansion rate of our POI has significantly decreased compared to that of a normalized period, as the decline in offline traffic to POIs make a large number of potential POIs inadequate for coverage in terms of our profitability requirement. While this has resulted in a decrease in potential POI fit for our coverage during the period of COVID impact. It also resulted in a general reduction in incentive fee rates for new signings. After the outbreak is contained, the potential POI pool is restored once offline traffic within the region is normalized. Because our incentive system aligns the interest of our BD with that of the company, we continue to maintain a healthy and efficient increase in POI coverage even during period of COVID outbreak. On the other side of the coverage expansion is our network partner model.
Through a series of marketing campaigns and implementation of new channels for partner acquisition, such as telemarketing and online acquisition, tailored to attract high-quality network partners to Energy Monster. We continue to rapidly increase our network partner count. As of the end of the first quarter of 2022, we have a network of over 1,300 network partners spanning across China. Our network partner count is up by over 180% YoY, and 50% QoQ as we accelerate our pace for attracting high-quality network partners. These network partners generally have previous experience working with POIs within a given region, such making them highly efficient partners for the expansion of our service network.
The number of POIs operated under the network partner model as a result increased from 38% as of the end of the fourth quarter last year to 38.9% as of the end of the first quarter this year. We also launched a series of innovative initiatives that leverages the advantage of direct operation and network partner models. Initiatives such as the opening of all region to both models and leveraging our direct operation team to attract new network partners allow us to extract higher level of synergy between our two core models. Our direct operation model, which have extensive coverage across China, can now leverage its presence to not only identifying new POI partners, but potential network partners as well.
At the same time, our network partners are able to work alongside our direct model in all regions to increase coverage in regions that were previously exclusive for direct model, allowing us to better leveraging our network partners' unique advantage. Because both our models have the market in terms of market share, we believe additional synergy between the two will help us to extend our market leadership more rapidly, more flexibly, and more efficiently. We also continue make strong progress expanding our KA coverage. Notably, during the quarter, we signed major brands such as Pizza Hut, Manner Coffee, and XPeng. Continuous expansion of KA remains an important component of expansion of our coverage, as KAs generally have higher level of foot traffic. While the impact of COVID, it does so to a lesser extent compared to smaller brands.
This makes KAs strategically important as they are impacted less during the period of COVID and have higher levels of potential during the period of normalized foot traffic. Our key priority is to target the top KAs within each POI segment, such as chain store, shopping mall, transportation hub, and movie theaters. By utilizing a top-down approach, we are able to make more efficiently on board smaller brands given our experiences working with the larger ones. Our abilities to customize our service that better fit into the POI's experience and to provide high-quality support also serve as key differentiators in Energy Monster's value added to KAs when compared to our peers. Going forward, we believe we will be able to leverage our existing strength in the KA segment to accelerate our penetration into all types of KAs throughout China.
In terms of competitive environment throughout last year and this year, we are seeing a general decline in competition under the direct model as our peers within the industry continue to significantly scale down their direct operation personnel. In combination with the COVID outbreaks and its more significant impact on our peers, we see a lighter competitive environment for POIs across all segments and regions. This decrease in new signing incentive fee rate and the reduction in usage of fixed incentive fees for new signings will help us better navigate ourselves during the period of COVID impact. Next is our initiatives on the operational efficiency front. Efficiency has always been a crucial part of Energy Monster's operating philosophy and a key differentiator that set us apart from our peers within the industry.
Because of impact of COVID on our top line, we have to continuously optimize our fixed cost and expenses. Improved efficiency greatly help us reduce these fixed costs and expenses, which in turn lowers the proportion of fixed costs and expenses as a percentage of revenue. Although the efficiency of our direct operation and network partner team remains market-leading, we continue to identify ways to increase their efficiency through measures such as back-end tool improvement and model innovation. Our business development personnel's coverage of POIs continue to increase as we implement measures to unlock the efficiency potential through better system and improved SOP. In the first quarter, our BD's coverage of POI per person has increased 33% YoY, making a significant increase in terms of efficiency.
The implementation of innovative models such as the leveraging of our direct operation team to attract more network partners will further unlock our efficiency potential as our business development personnel can have more avenues to contribute growth. We also continue to make strides improving our asset efficiency through our power bank optimization program and the launch of our newer generation of cabinets this year. We continue to implement our power bank optimization program during the quarter, which provide to us the most efficient amount of power bank that should be in the given cabinet based on a historical matrix. Additionally, we are also in the final testing phase of our new generation of power bank cabinets, featuring a redesigned external form factors and internal layout. While these new cabinets will have similar durability and features, they will have a significantly lower CapEx.
These new cabinets will also significantly enhance our ability to acquire more high-quality network partners as it reduces the payback period for our partners and unlock their growth potential. We believe our continuous pursuit of efficiency, both in terms of employee and asset, will significantly distinguish Energy Monster's position within the industry and unlock the value for all of our stakeholders in the long run. In conclusion, we continue to face challenges from COVID in the first quarter of 2022, and will face even more challenges in the second quarter given the larger scale outbreaks stemming from Shanghai and Beijing. Starting in mid-March, Shanghai's foot traffic was nearly halted due to the citywide lockdown imposed by the government. As a result, from mid-March to May, our revenue in Shanghai decreased by an average of 93%. Beijing is similar, but to a lesser extent.
From late April to May, our revenue in Beijing decreases by an average of 74%. While these outbreaks are challenging, they are short-term in nature. Starting in June, the recovery trend has been clear. For example, in Shanghai, in the first week of June, average revenue recovered to 27% compared to the same period of last year compared to the 7% revenue from mid-March to May. Despite ongoing outbreaks in Beijing and other regions, we are seeing time after time that demand for our service remains unchanged, and the regions impacted by outbreaks quickly recover to normalized levels in due time. Overall, COVID outbreaks cannot and will not be predictable.
That's why we have to focus on the fundamentals of the company so that we can better navigate ourselves during the period of lower foot traffic and capture the growth of the industry during the period of normalized foot traffic. We will continue to expand our coverage from our direct and network partner models, extending our POI coverage across all cities, POI types, and brands. We will also continue to introduce innovative ways for our direct operation and network partner model to leverage their respective advantage to achieve higher levels of synergy between the two models. We will relentlessly pursue higher efficiency, both in terms of our employee and assets.
Going forward, we believe our effort in coverage expansion and efficiency improvements will serve as a strong competitive advantage that sets Energy Monster apart from the industry peers, and allow us to effectively capture the long-term secular growth of China's mobile device charging service industry. Thank you very much. I will now turn the call over to Maria Xin, our Chief Financial Officer, for the financial highlights.
Thank you, Mars. Now let me walk you through the financial results in greater detail. For the first quarter of 2022, revenues were RMB 737.1 million, representing a 13% YoY decrease. Revenues from mobile device charging business was down 12.1% to RMB 717.7 million and accounted for 97.4% of our total revenues for the quarter. The decrease was primarily attributable to the impact of COVID-19 during the first quarter of 2022. Revenues from power bank sales were down 48.3% YoY to RMB 12.9 million and accounted for 1.8% of our total revenues for the quarter. The decrease was primarily attributable to the impact of COVID-19 during the first quarter of 2022.
Other revenues were up 25.5% YoY to RMB 6.4 million and accounted for 0.9% of our total revenues. The increase was primarily attributable to the increase in users, advertisement efficiency, and the new business initiatives. Cost of revenue was up 2.4% YoY to RMB 127.6 million for the first quarter of 2022. The increase of cost of revenues was primarily due to the increase in operational scale, resulting in increase in depreciation cost. Gross profit was down 15.6% YoY to RMB 609.5 million for the first quarter of 2022. The decrease was primarily due to the decrease in revenues from mobile device charging business.
Operating expenses for the first quarter of 2022 were RMB 708.8 million, up 1.5% YoY, excluding share-based compensation. non-GAAP operating expenses were RMB 702.1 million, representing a YoY increase of 1.7%. Research and development expenses for the first quarter of 2022 were RMB 27.1 million, up 31.2% YoY. The increase was primarily due to the increase in personnel-related expenses. Sales and marketing expenses for the first quarter of 2022 were RMB 659.7 million, down 0.3% YoY. The decrease was primarily due to the decrease in entry fees and the incentive fees paid to the location partners.
General and administrative expenses were RMB 27.4 million in the first quarter of 2022, up 2.1% YoY. The increase was primarily due to the increase in professional service and office rental expenses. Loss from operations were RMB 99.3 million, and operating margin for the first quarter of 2022 was -13.5% compared to 2.8% in the same period last year. Net loss was RMB 96.4 million in the first quarter of 2022. Net margin for the first quarter of 2022 was -13.1%. non-GAAP net loss, which excludes share-based compensation expenses, was RMB 89.7 million in the first quarter of 2022, compared to a non-GAAP net income of RMB 23.2 million in the same period last year.
As of March 31, 2022, the company had cash and cash equivalents, restricted cash and short-term investments of RMB 2.8 billion. Cash flow generated from operations for the first quarter of 2022 was RMB 160.9 million. Capital expenditures for the first quarter of this year were RMB 110.7 million.
Energy Monster currently expect to generate RMB 660 million-RMB 690 million of revenues for the second quarter of 2022. Please note that this forecast reflects Energy Monster's current and preliminary view on the industry and its operations, which is subject to change. Thank you for listening. We are now ready for your questions. Operator?
Thank you. The question and answer session of this conference call will start in a moment. We will take one question at a time from each caller. If you have more than one question, please request to join the question queue again after your first question has been addressed. To ask a question now, please press star one on your telephone keypad. To withdraw your request, please press the pound or hash key. Once again, that's star one for questions. Our first question comes from the line of Charlie Chen from China Renaissance. Please ask your question.
Thanks management for taking my question. I have a question regarding your business model. Can management elaborate a bit more on this synergy that you mentioned during your prepared remarks between the direct and the network partner models? Does the company have any preference between the two models during COVID or going forward? Thank you.
Thanks, Charlie. I will take this question. Our service network expansion has always been driven by both the direct and the network partner models. Historically, our direct operation model generally focus on the higher tier cities, while our network partner model focus on the lower ones. For our direct model, who will not generate very decent economy in the lower tier city. We generally select only one model for each region or city based on the city tier. In the past few quarters, we have also launched a number of test regions that run on both models. Results are very encouraging. Utilizing both models have superior growth rate. Our direct model team is able to penetrate into relatively larger POIs, while our network partners can leverage their existing relationships to extend our POI network.
Combined, these two models work in cohesion to help Energy Monster extend its coverage network, which in turn help us increase our market share. Both of these successful tests in pilot regions, we are starting to open all locations that we cover to both models in order to leverage the advantage of both models across China. We believe our network partners' unique relationship with will help us further penetrate into existing regions and also help us move into newer ones. In addition to the adoption of both models in all regions, we have launched a new program that synergize the two models by giving our direct operation team the ability to identify and attract network partners to our platform. Our direct operation model, which spans across China, can now leverage its presence to not only identify new POI partners, but also the potential network partners.
Because both our models leads the market in terms of market share, we believe additional synergy between the two will help us more rapidly and more flexibly to extend our market leadership. At the same time, more closely aligning the interest between our direct and network partner models. Thank you for the question.
Thank you. Our next question comes from Vicky Wei from Citi. Please ask your question.
Good evening, management. Thanks for taking my question. Will management provide some color on the monthly performance in the second quarter? By merchants categories, does management notice any recovery trends of different merchants, let's say, such as catering, cinemas, and other spots? Thank you.
Sure. Thanks for your question. The general environment has been challenging due to continuous impact of COVID on our operation, both in first and second quarter of 2022. I have to say that the second quarter, so far, by end of May, is even worse compared to the first quarter. Most notably, the outbreak in Shanghai, because our headquarters is in Shanghai, in March, was more significant than our previous expectation. During the first quarter of 2022, same-store revenue decreased by approximately 35% YoY as a result of these outbreaks due to, the general decrease of foot traffic. In the second quarter, various clusters of COVID outbreaks, primarily originating from Shanghai's outbreak, has a significant impact.
Starting in mid-March, Shanghai's foot traffic was nearly completely halted, almost none due to the citywide lockdown imposed by the government. Our revenue in Shanghai, as I just mentioned, decreased by 93% from mid-March to the end of May. In terms of the company overall GMV, we were down approximately 37% in April and 29% in May, as this was a general surge in COVID cases across China. Starting in June, the recovery trend has been clear, actually encouraging across all regions impacted by the Shanghai-led outbreak. In the first seven days of June, we see Shanghai's average revenue recovered up to 27%, low as it is still, it's recovering.
The revenue during the same period of time, if you compare, other regions that do not have active COVID cases are recovering at a similar trend. In terms of POI categories, the impact of COVID generally more negatively impacts tourist-driven such as transportation hubs, hospitality, and tourist attractions. Entertainment revenues are frequently required to close due to the government regulation if COVID is within the region, so they are down YoY as well. While the POIs that I just mentioned typically are more impacted by COVID outbreaks, the general recovery trend is more region-driven as opposed to POI type-driven. Regions that have been able to contain outbreaks recover across POI types as lockdown or quarantine restrictions are removed. Going forward, we're confident that the impact of COVID will eventually diminish as containment is achieved in all regions. Thank you.
Thank you. Our next question comes from Ronald Keung from Goldman Sachs. Please go ahead.
Thank you. Hi, Mars, Maria, and Hansen. I'm gonna ask that, can you give us more insight on the competitive environment in the first half of this year, and, how do we anticipate the incentive fee rate going forward into the second half? Thank you.
Thanks. I will take your questions. In terms of the competitive environment throughout 2021 and in 2022, we are seeing a general decline in competition under the direct model as our peers within the industry continue to significantly scale down their direct operation personnel. We currently operate the largest and the most experienced team under the direct model within the industry. This direct model team was instrumental in helping us achieve a rapid market share increase under the initial COVID outbreak in first half of 2022. With our industry peers scaling down their direct operation team, we remain long-term focused and have maintained our direct model team at a similar scale in anticipation of the recovery of COVID.
In terms of the incentive fee rate, the decrease in competition has benefited us as new signings generally have a decreased incentive fee as a percentage of revenues compared to our blended rate. This means that our incentive fees rate are going down as a percentage of revenue. Also, we are more widely adopting the usage of variable incentive fees as new signings rarely have fixed entry fee. Well, we don't provide guidance on the incentive fee rate for the future. The current trend for the new signings and the decreased utilization of fixed fees are positive for our financials going forward. Thank you for your question.
Right. Thank you. We are now approaching the end of the conference call. I will now turn the call over to Energy Monster CFO, Maria Yi Xin, for closing remarks.
Once again, thank you for joining us today. Please don't hesitate to contact us if you have any further questions. Thank you for your continued support, and we look forward to speaking with you in the coming months. Thank you.
Right. Thank you for your participation in today's conference. This concludes the presentation. You may now disconnect.