Q2 2020 Douyu International Holdings Ltd Earnings Call
[music].
Good morning, and good evening, ladies and gentlemen, Thank you and welcome to do you went on National Holdings Limited second quarter 2020 earnings Conference call.
This time, all participants are in listen only mode.
Hosting a question and answer session. After managements prepared remarks, I'll now like turn the call over another first speaker today, that's MMR Investor Relations. Please go ahead ma'am.
Thank you operator.
Welcome to our second quarter Incidentally earnings call John Today, Mr. Shao Airtran, Jim and I say, you know me, meaning so shafts Jackie up there.
And they have to how widespread done branding.
Okay, Thats out there I'm going off 200, Twentys and naturally Dod I all websites.
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Although check a replay of this cool well it becomes a medical you'll feel I learned I Oliver.
Before we stop Pik note that this call may contain forward looking statements made pursuant to the population.
Well the private pay security issue its at 99 Goodbye.
Forward looking statements are based on management's current expectations and observation.
Well, no and I'll know list on Thursday, and other factors not under the company's control, which may cause actual resolved. So it's almost a two month of the company to materially different from there is not supplements our expectation implied by these forward looking statements.
All forward looking statement I'd classmates quantified in their entirety by the cautionary statement, it's vactor and details of the company's fighting with the FCC.
Company undertakes no duty to revise or update any forward looking statement puts the left to be bad. So committed after the date of this conference call.
Now I was based on behalf of our chairman and CEO Mr. Shao DHS.
This evening issued a press release, which was flattish to the Securities Exchange Commission Commission on the from 6K reporting that we have received a non bidding proposal letter from pension Holdings limited.
Okay, then the release in the Raptor election section I, our websites at <unk> Dot Dot Dot com.
Going to the proposal letter pens, and Pergo Dolby and we got Inc. to enter into a stop for stock merger to be affected pursuant to the cable goal as a result of wage who yeah I'll ask subsidiary or the acquired each offsetting ordinary share of though.
Including ordinary shares are presented by Americans, the both duration year exchange growth to be a greater number of newly issued Clos a ordinary shares of we are.
It was subjected received a letter and no decision has been made of adding can with is back to the proposal transaction.
The board, we will continue to adapt the transaction.
Yes, no assurance that ending debt that initiative offer will be made that any agreement will be activity, our that today or any other transaction will be approved our customer paid the company does not undertake in any obligation to provide any update with.
With that of Dave or any other transaction, except as required under applicable law additional information will be provided if and when appropriate.
Now I'll turn back to our second quarter performance.
We conclude the second quarter of Twentytwenty with solid financial and operational result, as both our total net revenue and profitability reached record highs.
In the period total net revenues increased by 33.9% year over year to RMB two point 51, beating Additionally, gross profit increased by 73.7% year over year to RMB 522.9 billion, while gross margin expand.
The two tinted 0.8%.
Meanwhile, net income was RMB 319.3 billion, representing a net margin of 12.7%.
Non-GAAP net income increased to RMB 322.9 meeting the presenting a non-GAAP that margin of 12.9% and ARPU increased by 19.7% year over year to RMB 300 and Opex.
Although the resumption of People's regular walk at school schedules led to our short term measure our users have a growth our average mobile meiyou comp maintained at the rapid growth trajectory in the second quarter, increasing by 15.4% year over year Skillsets to 8.4 billion.
The steady improvement in operational result was mainly due to our promotion of new game last streaming content.
Our collaboration with diabetes and completion of streamer, which high growth potential as soon as our production of the period is saw centric last streaming content and the grant.
Since our Companys inception, we have firmly believe that high quality again like streaming content in the fundamental growth driver for both user retention and the user engagement as such we maintained our commitment to augmenting our user value proposition.
And in a quarter by reaching our April content and expanding our non game segment content offerings.
In the quarter for example, we continue to broadcast and produce popular if both Harman and deepen our collaboration with leading is both streamer such efforts have to grow our supply of premium is for content and that the two further bolstered our industry leader.
The addition through our exploration of different non game content segment, we witnessed the user traffic growth of both our food and live content categories accelerate in the period.
Our expansion both upstream and downstream the eight bordallo Chen also yielded annual results during the quarter for example to off hours above that is both teams from high profile Todman.
Including League of Legends T. Act as a mid season, you additional twentytwenty and pop GE else does add the pcls bring twentytwenty. This part of dynamic 814 partnership a providing us with the necessary pool to further amplified our brand present.
Supercharge, our counter leadership and a 10 basis our platform as the go to destination for watches superior April accountant in real time.
On the gaming bonds, we successfully broadcasted more than 50 large scale is automatons as we continue to deepen our collaboration with leading game developers and game publishers such attention in this quarter.
Our cost of PPL, we'll walk can the hand with the owner of key project team to the while a meal Tom month class platform Streamer commensurate focused model.
Innovative model enable users to enter into a livestream meizu of the available capital streamers, two watches dreamers converse and listen to their commensurate during the event.
Page proved to be applied to appearing in the period.
To further enhance our plan from deeply as streamer yields are relationships tend to.
We are very Tom and broadcast we also produced more than 58 for 12 months internally and through collaboration with the extra no partners in this quarter.
Our in house production outgoing Golden Grant 12 months can deny for example.
Well, it's tradition of excellent as is generated significant user traffic for our game segment and help to ramp up our user engagement our platform during the event.
Going forward, we plan to accelerate our growth trajectory by implementing a three pronged content strategy first and foremost, we'll continue to generate high quality for content, including a slower analytic embryos and common centric content.
Your in house production and joint development with accidental partner.
Nation, we plan to activity deployed and refined new equal related business model such as cloud game.
We will also continue to optimize our systems for streamer training and recruitment. So that we can capitalize on those opportunity which emerged from new blockbuster game launches.
Our market penetration and accelerate our mobile and be more user growth and conversion.
On monetization brands, we continue to refine our events model and into active features to battle corporate usurping habit and augments our monetization capability during the second quarter also books on refining our operating tactics for each of our content.
Most especially our game segment substantially improve a segment monetization efficiency.
As a result.
Our quarterly paying users increased by 13.4% year over year to 7.6 meeting in the second quarter, implying a payout ratio of 4.6% as compared to 4.1% in appear year period.
Moreover, ARPU also increased by 19.7% year over year to RMB 200, and Opex in the second quarter.
At the same time revenue contribution from mid tier streamers, our platform grew sequential comparisons for the fourth quarter Euro further validating the strength of our media streamer.
Going forward, we plan to maintain our focus on the expiration of new into active product features and event models. We held our platform over operating efficiency also into further refine the operating efficiency of each content segment.
This should help to upgrade monetization combated of each segment and live streaming Wilmington.
I Wonder globalization front, we continue to impact in Japan to expand our market share and accelerate the growth trajectory of our Japan is last streaming platform model.
In the period, Japan is user continued to be highly attractive by modems vibrant gave like streaming ecosystem with a plan from ranking among the top Japan is game like dreaming camper in terms of mobile downloads user base and user engagement. According to a bank consulting in summary.
We maintain our rapid growth trajectory to deliver solid financial and operational achievements in the second quarter of Twentytwenty.
Going forward, we plan to continue deploy resolve this up and down a boat industry Velo, Chen while ramping up our R&D and operation investments to further optimize our user experience and the illegal Eric our east Bloxom Shake live streaming community.
We also aimed to further refined our product development site.
Cycles Streamer management team based term and content operation strategies to upgrade our monetization and operating efficiencies we remain confident in our ability to consistently how our financial performance deliver lasting shareholder value and beer has the development of the gain last year.
The industry in China over the long term with that I'll now turn the call to our wives President opining made to how to go through the details of our financial performance in the seven quarters.
Yes.
Thank you ammo Hello, everyone.
Im pleased to announce that our total revenues in the second quarter of 220 continued growth increasing by 3.9% to RMB 2.51 period from RMB 1.87 failure in the same period anti 90.
And exceeding the high end of our previous guidance range.
In addition, during the second quarter of uncertainty gross margin expanded to 20.8% from 16.1% same period of 2090.
Net income increased to RMB 319.3 million from RMB 23.2 meter in the same period of 290.
And adjusted net income increased to RMB through Hunter and 22.9 meters from RMB 52.6 meters. The same period of 2090.
Now please allow me to provide you with some more details regarding our key financial metrics.
Total net revenues in the second quarter of Twentytwenty increased by 33.9% year over year to RMB 2.51 period was RMB 2.32 billion in loves premium revenues and RMB 100.
Data point 3 million in advertising and other revenues.
Last screaming revenues in second quarter of Panty increased by 35.8% to RMB 2.32 billion from RMB 1.71 period.
Period of 2090.
This increase was primarily attributable to the optimization of our platforms interactive features as well as our continuous requirement of the bump mechanism.
Both of which helped to further cartilage user pay habits.
This initiatives helped to increase both user screamer interruptions and use a payment frequencies on platform.
Especially for game segment.
As a result are paying users in a second quarter of Twentytwenty increased by 13.4%.
To.
7.6 million from 6.7 million in the same period over last year.
Advertising and on a revenues in the second quarter of Atlantic increased by 14.6% to RMB 188.3 million from RMB 164.4 million in the same period of time to 19.
This increase was mainly driven by ongoing growth of our brand recognition and corresponding increase in demand of.
Integrated streamers promotion advertising for.
Cost of revenues in a second quarter of panty increased by 96.3% to RMB 1.99 billion from RMB 1.57 billion in the same period tend to 19.
More specifically revenue sharing fees and cotton costs in the second quarter of Twentytwenty increased by 32.3%.
RMB 1.75 period from RMB 1.33 billion in a same period of time to 19.
The increase in revenue sharing fees and the content costs.
We generally be explained by the falling drivers during the quarter.
Revenue sharing fees increased which was largely in line with the increases in total net revenues.
Additionally, we also reached our platforms is part of related content, while continuing to but about our expansion initiatives in Japan.
Furthermore, we increased our investment in total meant related videos and enhanced content production.
Finally caught in the second quarter of Twentytwenty increased by 9.8% to RMB 168.4 million from RMB 153.3 million in the same period of 290.
The increases to bandwidth costs were mainly driven by increases in mobile user growth and total user engagement as well as our ongoing efforts to improve the viewing experience of our users.
Gross profit in second quarter of penetrated increased by 73.7% RMB 522.9 million from RMB 301.1 made the same period of time to 90.
Gross margin in a second quarter of Tentwenty expanded to 20.8% from 16.1% in the same period and in 90.
Such expansion was mainly driven by our monetization capabilities as well as our increased economies of scale.
Now turning to our operating expenses.
Sales and marketing expenses in the second quarter of penetrated decreased by 15.3% to RMB 142.1 made it from RMB 157 point estimated in the same period of time to 19, mainly due to the decrease.
The marketing expenses related to the postponement of large scale offline events are the result of coal, we buying team and related safety concerns.
Research and development expenses in the second quarter of 10 to 20 increased by 12.5% to RMB 94.9 million from RMB 84.4 million in the same peak period of trends 19.
This increase was primarily due to increased investment in technological innovations.
As well as higher share based compensation to related employees.
General and administrative expenses in the second quarter of Penn advantage increased by 8.4% to RMB 79.5 million compared to RMB seven to 3.3 mirrored the same period of 2019.
Mainly as a result of higher professional service fees related to the requirements of being a publicly listed company on domestic.
The amount of share based compensation expenses allocated to operating expenses in second quarter of an advantage was RMB 33.9 million compared to RMB 27.4 made it in the second quarter of 2019 and RMB 41.9.
Later in the first quarter of pent trending.
Other operating income net in second quarter of an advantage was RMB 32.5 million compared with RMB 14.5 million in same period of 20 Monte.
Adjusted operating income in a second quarter of Penitentiary, which excludes share based compensation expenses increased to RMB 232.7 major compared to RMB 13.4 million in same period of anti 90.
Net income in the second quarter of 20 to 20 improved to RMB 319.3 made it from RMB 23.2 made it in the same period and to 19.
Adjusted net income in the second quarter of Twentytwenty, which excludes share based compensation expenses.
Never lost the equity method investments and impairment loss of investment.
Improved RMB 322.9 million.
From RMB 52.6 made in the same period of 2019 reply and adjusting net margin of 12.9% for the second quarter of 2020.
For the second quarter of transatlantic basic and diluted net income per ads were RMB, one point, our six and RMB one point out two respectively.
While adjusted basic and diluted net income as were RMB, while hi, our seven and a one on RMB, one point or seven respectively.
Looking ahead.
We remain focused on improving our monetization capabilities and operating efficiencies, while also implementing investment to continue upgrading our user experience.
Fine outperform offerings.
And expanding our market share.
We expect our total net revenues for the third quarter of Cadtwenty, two indeed ranch of RMB 2.64 billion.
To RMB 2.68 period.
This forecast reflects our current and preliminary views on a market and operational conditions, which are subject to change.
This concludes our prepared remarks for today, operator, we're now ready to take questions.
Well now begin the question answer session.
Good question May Press Star then one on your Touchtone phone.
For using the speakerphone, please pick up your handset before pressing the keys.
For all your question. Please press Star then too.
Please limit yourself to one question first asking in Chinese then repeating it in English.
At this time, we'll pause momentarily to assemble our roster.
First question comes from resign Bank of America. Please go ahead.
Hi, Glenn is how I shall have synthetic orders.
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The bank that sense management for taking my question that congrats on a strong results. My first question regarding though and then a proposal are now. So today earlier you by May could management share waste apps, we are real Andres and second delay can you give us an update.
So your car and collaboration with the 10 cents in game area, what have the major ways, our trajectory, which turns and now underway back to any further synergy are changing our future.
Thank you.
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Since the question I'll have to translate so as active card across our broad sense.
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Ill review and the value in the proposed OLED is detail out to make ambition.
Proposals transaction, so referred to our press release enters the SEC filing for the details which has been reluctant to their track record in terms of the second question as we can be.
In lab.
The important part intensive strategies. This is good for our new wells and actually going forward. So they have all been maintained a close to that will share relationship with the lab streaming middle office and most.
Projecting upfront.
So at the early stage of the Corporation, we conducted a much more exploration with Tencent mid opens regarding potential initiative. Currently we are discussing the information initiative, including such as data market share and also saying okay from engine portal inside of game.
With our major shareholder season. So we believe this will significant helped should improve.
Mobile traffic and also.
Market penetration rate for the future. So thank you.
Operator, please address the next question.
Thank you. The next question comes form I am saying of Citigroup. Please go ahead.
Hey clients, how a sharp shareholder Tesla.
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Wonderland, Cuba trauma current archeological project with Sonangol goal, which.
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Platonic before since year, so or through the financials.
Thanks, Michael Thanks for taking my questions Hope of course, we recorded a menu. So after direct functional what kind of course, we're still say sequential revenue growth on both to say on the mobile and so from our own internal data to waive any change in end user behavior.
Thank you.
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Assuming similar to begin immediately you will know you want to the international mediator near record annual do you think significant impact.
Don't get on the regulatory issues, whether due to shipping every month.
Oh sensor question I will help to translate.
Absolutely.
A user behavior is that in play consistent with the trend over the past few quarters, which shows our high yields are sick.
And in the seven quarter. The average maximum active user retention rates actually new man about above 7% to 5%, which were stable compared to the previous quarter.
Meanwhile, our user behavior data also showed that with the increasing number of years user stands our plan for the average monthly time that also includes this growth curve remain consistent across user who joined us at different time, and we have gradually become hi.
And also the loyal.
Clients of our Penford and they'll be a not not any changes which is compared to the last few quarters.
So operator, we count Dracula gnatcatcher.
Thank you for next question comes from Thomas Chong of Jefferies. Please go ahead.
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Our friends management for taking my questions and congratulations on a very solid set top results. My question is about the Q2 revenue.
Perfect color the lights remain.
Revenue.
Key factors, which drives the revenue growth. Thank you.
Okay.
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Yes.
Some peer pressure our hub translate.
After in the second quarter yields.
Assumption of more of war and auto.
Gross impaired from traffic and the number of paying users actually outpaced cannot live shows competitor.
However, our counted our content refinements of operation as are the wireless users paying having meanwhile, our continuous development and the refinements of plant.
Actually features and products have enhanced user streamer into action and increased user will need to pay and the pain print quality. So as a result, the number of our total paid users remained stable at 7.6 billion comp.
To the fourth quarter of this year and ARPU also increased by 9.5% quarter over quarter show on the the hunger and Olympics.
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Yes, youre shipping dropping it normally tap into such as income so why don't swap entitle observable known that play a potential kiss a lot sales shift into the potential you have total can ship.
Our requirement of operation across segments helped to improve each segment months addition efficiencies in particular, our game segment monetization capabilities continue to improve in this quarter. We also continue to diversify our content to improve the monetization.
Currently and the revenue contribution of the non gaming segment.
Total volume liquidity Mihalos was TG.
You implement and data center that we also two portfolios RMP shoot us Angela to Apple to put a conditional DG, it's always downward as the good news on the third quarter fiscal RG 2000 diesel bottom ship operating deal with deep crossover vehicle fleet.
We have also improved the mid tier streamer mines additional efficiencies.
For our collaboration with the talent agency and also tenders mathematician product apart from day. The combination of large scale event and also the timeline. So quickly brand in the second quarter continued to both our Penford Man's addition, come a day and also to improve.
Our total net revenue.
So thank you operator, please address the next question.
Thank you. The next question is from Alex tone of Morgan Stanley. Please go ahead.
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Profitability or the once you sequencing.
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Translate my question.
My first question is regarding your streamer recruitment situation, especially for new games sprawl stars and DNF mobile coming soon.
Can you share with us what's your strategy to acquire.
To recruit these tops treatments for new games. Thank you.
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Hello sensor question on how to translate.
In terms of yield entitled where you recruit streamers Encana two way the first play where discover and encourage streamers, which high growth potential from the similar type of game to stream the new game titles.
This helped us generate high quality content and Kouchner, new users to our Kemper.
Also includes large amount of streamers by collaborating with the top.
And agency to ensure the accordingly, and also the quality of new game content.
Actually on top of this way kick monitoring.
The streamers performers in the new segment and also provides a high quality streamers will resolve base our platform to help them become the top mid tier Belfast block captors.
The large number of premiums Dreamer, and indeed partnership with industry, leading game talent agency enable our to maintain our leadership in promoting under distributed the new game titles.
Because of the advantage mentioned above.
Both the Cape a leading position in key metrics such as total sales and also the user engagement of growth Das and other neo game titles goes forward, we actually will continue to leverage our Jan to maintain our data edge in the operation up new titles.
Patrick the mobile.
So operator, please address the next question.
Thank you. The next question comes from Daniel Chan of JP Morgan. Please go ahead.
Hey, Whitehall Glenn is.
Considering the challenging.
Well when you got on quite a when did your share.
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Good.
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I would say myself. Thanks management, congrats are very strong quarter.
My questions Firstly on the content side.
What kind of plant, we have R&D content diversification and what's the future strategies on.
Both the sport and our new spot a second wise, we are exploring some new products. Besides our current like streaming platform and also whats our future.
Strategy and some non life changing what oxygen model. Thank you.
What after that.
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For the year to new recruits.
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Yeah.
So sensor passion I will help to translate in terms of our future game content strategy will continue to invest a lot.
Gotcha League of Legends OPG, Profire and will also pay close attention to the new plastic entitle and explore astute go live streaming gate throughout the industry verticals of them low in the third quarter actually will have themes asset.
Gain growth dock delivered outstanding results our Casper.
After the Meanwhile, we continue to recruit streamer four different new game segment demented.
No supply of high quality content and also attract more users to our platform.
We will keep viewed the April contest and community as a long game related areas such as in video.
In terms of our non game segment. After we'll continue to enrich the company ecosystem to make a user diversified constant demand in terms of like food like.
Turning show auto and although the LPG.
In terms of the innovation, we have been exploring ways to diversify our revenue.
Example, we launched at the new business model the voice chat in October of 2019.
The revenue has grown database the new segment has helped us to further improve almonds additional efficiency and also capability in may two long drawn we are actively preparing for the deployment across Dave.
And expect the club game related gain distribution and also the advertising business to become our NAV growth engine.
Sure.
So operator Lake contract next question.
Thank you next question comes from Alex alone of Chinese Renaissance. Please go ahead.
Hey, Michael productivity for the LNG will show on kind of liquor control charity too.
Hey, John usage, our Chiger unitranche, among our drilling as Michelle.
So theyll currently showing the linear shower door pressure fabia, John show that challenging so when we haven't yourself.
Firstly myself two housekeeping question here first was the major drivers of our bandwidth costs this quarter how will this.
Fair enough in the next few quarters also for sales and marketing.
That's helpful marketing expense was up quite a bit sequentially. This quarter any any color on what's driving that thanks.
I will benefit our to go find eco type ultimate settlement.
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We continue to sharpen our bunch of but the noble parts of on the commercial Virtusa.
The Utica strategy to the sense of opportunities.
Thats Fair question, Alan how to translate.
Now lets call increased quarter over quarter.
Because that so more tolerant and the higher user engagement in the second quarter.
Additionally, we have always been committed to improving our user really experience and that provided a user with the higher pointing majors and content during the period.
We expanded data that would cause in the second half of trendy translates to increase like may quarter over quarter.
I think there will be more intensive tournament in the third and also the fourth quarter.
But everyone is acquiring it took us also sale.
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Hi shoulder season, we are Geoparks announced on April so your way that as a consultant.
However, actual physical within a gentle.
And the commercial sales potential to be talk a little of which youre.
In terms of your second question.
Purchase related sales and marketing.
Actually that we insured.
Derek and other related expense trend of promotion costs.
Hi, and offline activity, it's that actual assets that the bulk of fee to the is 40.
Second quarter of Twentytwenty, the sales and marketing expense increased mainly due to.
The Palmer's related marketing costs as a commerce gradually recovery and also the increased about the shift to the ratio at both teams and also the channel promotion expense.
As a quite costly to why the development of the April industry in the longer term will continue to increase investments in export related activity and also the is 14 partnership.
Well, we will upgrade our to adapt.
To improve the monetization efficiency and also in 10-Q E House the channel promotions. Therefore, the absolutely value of our sales and marketing will increase but if we look at the as a percentage of the total net revenue and we'll we'll continue to decrease in South Africa.
Operator place aircraft than that.
Thank you. The next question something at all of Th capital. Please go ahead.
Glenn in some galaxy Sseven accounting.
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Sure we'll mention is that you Ben.
Okay, and the you push out.
Well Felicia, yes, Matt you will see you see share what the to the pulpwood to that's where you'll see that you said they led to help medically copal Amba, you'll see CTG poor C.
Cool now much cooler Chico too high.
Hey, good happy cheating here.
Let me frame.
So my questions related to the overseas expansion in the opening remarks company management mentioned steps.
In Japan so.
Good luck.
Clear color on that.
Yes.
You are paying Michelle and what the gain is at the top games in that.
At this platform and going forward.
Companies.
Coming.
More what became our 10-Q.
Thank you.
So here you know what youre lapping items to tell on say, let me cover additional omen say, however, Oklahoma dominate.
Good into this year, however, I'm going to hit rule that issues on the diverting home.
There are some graph to which would they are not to mention that actually your posture that issue on the tissue. The two levine today.
Metrology in that group.
Yes, as I mentioned before our earnings call that we have already.
Investments into the stock is awesome is Asia and also Latin America investment.
I have already begun not him that.
The users quoted not quite good the in that kind of area. The actually will have decreased Canada the investment.
Yes.
Thank you on that could be a kind of grown dramatically.
Our digital connection leads to how you should look racial starting in Argentina TG guys are three debentures.
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Remain channel multimedia MUTA took a Chinese reaching into too risky truncate Mccallum Peschier Caribbean.
Can you dig deep dive lumpy decor business, starting development, probably the ruble Luke you're working on during our call further downward revision should not be with them that you don't know each other they are equally are you willing to fully OE in data center usage, what's your trombone Sheila.
It.
Welcome to not.
Hello, each other because you mentioned on the if you're looking ahead of me. There then we will come on the do not chip will element with TV tuner you mentioned on the JV.
We also remained brandy, we'll end up although format, which is.
You know from initial goodwill to organization should Montana, where more than three.
During the second quarter, we continue to enhance our investments in Japan, if market, we launched meltdown.
In Latin platform in Japan in the mid September of 2019, and is a development as bad as our expectation.
Turning to the obtain consorting mill down ranked among the top downturn in Japan is gaining traction market, which has in terms of the mobile app downloads. The user base and also the user engagement and we think that we'll continue to explore the Japan is market and the deal.
And our collaboration with Japanese partner in terms of the local resulted to achieve that add care economies of scale.
So to sum it all to your question manner.
Well you don't see this should be more deeply you may go over the two more diesel the older legal assumption Amir.
Negotiated as evil.
Our team working diligently on we will keep initial moussavi potash only began to be shop.
Our some of the only way all Ashwin I do see just walk sampling the product, which we've been on succeeded.
Next we'll keep undoubtedly shopping malls.
So maybe you may lose.
And that target shockingly through Java, Sintel occupancy occupancy.
Yes.
The reason why we think the Japanese market very important.
Because actually Japan.
Largest gaming market in terms of the market size after North America as in China. It has almost doubled banning power compare with South America and also the European countries and gamers, a more waiting to take whenever the development of those gains last year.
Any industry in Japan, if you add early stage, so which is not consistent which with is large and the mature gaming market. So that means there will be appealed potential.
Thanks, Jamie.
The Japan if market.
So so thank you operator.
Yes.
This concludes our question and answer session.
The conference back over to management for any closing remarks. Please go ahead.
Yes.
Thank you for John I would call. We're looking forward to became with everyone. The next quarter.
Thanks.
The conference has now concluded. Thank you for attending today's presentation you may now disconnect.