Full Year 2020 Agora Inc Earnings Call
[music].
Ladies and gentlemen, thank you for standing by while come true for Q in fiscal year 2020 financial results Conference call. At this time, all participants are in a listen only mode.
After the speaker's presentation, there will be.
And the answer session.
To ask the question during the session you will need your breasts are one of your telephone.
Please be advised that today's conference is being recorded all the.
Like to had conference over to your first speaker today Ms field of Chen. Thank you. Please go ahead.
Thank you operator.
Good evening and good morning, everyone of my name is Fiona I'm thinking about the relations at Agora. Thank you for joining our growth fourth quarter 2020 earnings Conference call. Joining me today Arent 20 job founder Chairman and CEO.
And the gene go along our CFO.
The earnings results press release, and a slide deck can be found on our IR website at investor Dot Agora the aisle.
Reconciliations between our GAAP and the non-GAAP results can be found in our earnings press release.
During the call we will make forward looking statements about our future financial performance.
The other future events and trends, including guidance. These statements are only predictions that are based on what we believe today and the actual results may differ materially. These forward looking statements are subject to risks uncertainties assumptions and other factors that could affect our financial results and the performance of our business.
We will discuss them in details in our filings with the SEC, including today's earnings press release.
And the risk factors and the other information contained in the final prospectus relating to our initial public offering of Gras assumes no obligation to update any forward looking statements. We may make on today's call with that let me turn over to Tony.
Okay.
Thank you Tony and welcome everyone.
Reflecting on the year the global economy has brought tremendous changes and challenges every day.
Yes.
The year Thomas.
We have seen a significant acceleration in demand for online ways of living and working.
There is the growing need for contractual of real time video or voice engagement almost any app.
Paul to be there when the world needs is the real time engaging with more than ever before.
Our earnings the finished the fourth quarter with revenue of.
For the three 3 million.
74% year over year, we reached more than 270 solvent. The adjusted apps at the end of December adding nearly nine fold them per month in the fourth quarter.
All the number of after the customers reached nearly 10 the 100.
101% year over year for full year of 2020, our revenue was $134 million, which represents an increase of 107% year over year.
Besides the numbers 2021 of the year of innovation with.
We crossed the number of noteworthy milestones such as powering for the data.
The minutes of engagement per month with continued credit industry, one such as our expense level of womens or accelerate the further broaden our product offerings and optimize our technology and the helps developers around the world to create many innovative use cases.
All of the net new use cases.
Part of I want to elaborate on two of them here.
The first of all the interactive luxury of hall of large class classroom. It's more of the 100 students is widely considered as the multi pump economical model for live online education.
Previously such process of towards true one way for testing power by traditional content delivery technology.
The fees anywhere between three and 10 seconds or even more.
Given the high end.
Agency, there is very little room for students interact with teachers.
Among themselves recently, we have been working with leading all of education institutions on the redefining the luxury of hall experience.
Here the drop of lecture hall runs entirely on our real time engagement platform and the switch between one way for putting cash in and fully and fully interactive breakout sessions dividends. The one way for cutting session student.
Enjoy the growth had none.
Non video interactions such as voting and the posting emerges.
During the day call session students from small groups to work of.
Students for small groups to work on assignments together weekly.
Leave that interactive lecture hall hallmarks of engaging learning experience of small cost and the cost effectiveness of large parcel.
And it is an emerging trend in all of our education.
The second one is audio live cost.
I believe most people are familiar with audio podcast.
What is out of low cost.
Podcast is light.
Video channels.
There is one speaker or sometimes multiple speakers in the same physical room.
And all of the audience simply listen to the speakers.
Livestock part of the other hand create award show in the same room experience.
Here multiple speakers enjoined from different locations worldwide and discuss spontaneously sales to ultra low latency audio instead of just listening the audience can raise their hand and come on stage to join the speakers anyway.
We believe <unk> represents a new way for people to connect the learner and we are particularly Pas for.
Per out the hour per.
For power for a lower audio codec further enhance the appearance by offering crystal clear actually audience.
These are just two examples of the many new use cases with the such as the virtual events remote assistance remote collaboration and virtual tours.
Really encouraged by the U C.
Susan and the productivity from our blockers.
It also made solid progress on new products that in this quarter recently, we released the first word of <unk>.
For flexible cost range.
Low code application path solution for education providers. The combines video voice messaging whiteboard and recording from charges into one cloud based solution that allows developers to build an online classroom in the matter of minutes.
Compared with our standard our SDK our growth.
Our flexible costs from kind of a significantly simplified suffered software debacle of mint and the <unk>.
And time to market.
Tom part of was out of the box SaaS solution.
For our flexible costume allows developers to use their own brands and have.
How complete control of their own user data in addition.
Our growth flexible costume is.
Modular.
This modular which means to offer kind of customize their application to create differentiated user experience.
Our growth of flexible platform represents an important step in our low code no code effort, which we believe will reduce the friction of adoption and expand our addressable markets.
Moving on to the M&A slide.
Okay.
Recently agreed to acquire is month of leading instant messenger.
Just on the messaging API provider.
And complete the requisite acquisition of Netherlands, a leading interactive whiteboard APAC for either.
All of the company share of our dwell for the first philosophy.
They are highly complementary to our product portfolio, which all what's left for us and our customers often asked for.
As a pioneer in long time market leader.
More has also.
Also has a large and vibrant developed for our community we believe that with the positions we are.
Uniquely well positioned to help the offer more immersive.
Real time engagement to use cases.
Last but not the least securities conference in the promise of protocol for Hudson.
This growth to our success.
Recently, we reduced.
Recently, we received a sort of fit.
To type one certificate.
The certified by Deloitte.
All of the network penetration of pictures of vulnerability and compliance assessment will also recently completed by Trust reported a global Securities specialist.
Looking forward we will.
We continue to work with leading the leading experts to ensure that all of our security practice remains best in class.
Overall 2020 was a milestone year for us in many ways.
We launched a girl several years ago in the garage instead of them early and it's amazing how much we have accomplished in the past several years.
The one.
I want to take this moment since all of the developers customers partners and the lessors for your trust in us and above all to all of awards, including newer brands from the small and Natalie. Thank you for your hard work and commitment to serving our door for us and the customers.
There is a long journey the height of us towards ubiquitous real time engagement.
Let's start first just like seven years ago.
Now, let me turn sales over to Jim who will review of our financial results.
Thank you Tony.
Hello, everyone.
Start first by reviewing the reviewing.
Reviewing our financial results for Q4, and then I will discuss.
For the fiscal year of 2021.
Total revenues of 74% per year.
So the three points from the mining in the fourth quarter of 2020.
Total revenues for the fiscal year 2021 of your guys scholar $133 six minute, which represented 107% year over year.
Growth and exceeded the high end of the guidance by $3 6 million.
In 2020, we have powered more than 500 billion minutes of use.
Im engagements in total.
As we mentioned in previous earnings cost of revenue in Q1 to Q2. This year were positively impacted by the.
The pack of usage due to COVID-19 in China.
In order to help investors better understand all of them.
Panic growth, excluding such impact we calculate Q1 Q2 adjusted.
Adjusted total revenue and photos.
For each customer in China, we use this revenue in Q4 2019, as the starting point and the.
The revenue in Q3 2020 at the edge.
Endpoint and.
And the cat kind of its.
Adjusted net revenue in Q1 Q2.
Arithmetic progression from the starting point.
The point.
Revenue from customers outside China remained unchanged.
This would lead to an adjusted total revenues of $22 two of many in Q1 and 27 million in Q.
The two.
And the adjusted total revenue for the full year of 2020 were 113 points from moving.
Our trailing 12 month constant currency dollar based net expansion rate.
179 per ship.
If we use adjusted total revenues.
The adjusted expense rate would be 149%.
Now turning to cost expenses and margin.
And the folks down.
Non-GAAP results, which exclude share based compensation expense.
Non-GAAP gross margin for the fourth quarter.
<unk> 65 per cent.
Which was five 9% lower than Q4 last year.
2% lower than Q3 this year.
The decrease in gross margin was mainly due to international expansion into regions with heart infrastructure costs.
Southeast Asia, South America and Oceania.
As well as the capacity expansion.
Dissipation of future usage growth.
Non-GAAP R&D expense of 13 million in Q4.
8% year over year as we continue to do the R&D team.
Non-GAAP R&D expenses were.
The 39, 2% of total revenues in the quarter.
Compared to the 36, 4% in Q4 last year.
Looking forward, we will continue to invest significant resources.
The R&D capabilities in order to further strengthen our technology leadership and broaden the API for food.
Non-GAAP sales and marketing expenses were $6 9 million in Q4 up 34% year over year, mainly attributable to the team expansion.
And the increased advertising and the event expenses for example.
Virtual conferences October.
Sales and marketing expenses represented 28% of total revenues in the quarter compared to the 27, 1% except for last year.
It has again demonstrated the efficiency and scalability of the developer centric go to market model.
Non-GAAP G&A expenses were $5 7 million in Q4 up 163% year over year, mainly due to the team expansion and professional service fees.
G&A expenses represented 17% of total revenue in the culture.
Per to 11, 2% income for last year.
Non-GAAP operating loss was four point for point of $8 million translating to a 14.4% non-GAAP operating loss margin fourth quarter.
Compared to a net loss margin of error.
The 0.1% for last year.
Turning to cash flow.
Operating cash flow was positive $2 million in Q4 compared to positive $2 1 million last year.
Free cash flow was negative $1 4 million compared to a positive <unk> 9 million last year.
Net cash outflow in Q4 was mainly due to the purchase of servers and network equipment as we continue to scale the business.
Moving on to balance sheet, we ended Q4 with $625 4 million in cash cash equivalents and.
Apart from investments.
Compared to $635 million.
Q3.
Subsequently we raised.
The 2 million, but usually the.
Ordinary shares.
The master earlier this month.
Now turning to guidance.
COVID-19 is unprecedented viral 12 business model.
The historical experience may not apply.
Our guidance for your revenue reflects a number of assumptions that are subject to change based on all of sudden piece relates to the impact of COVID-19.
What does that mean currently expect total revenues for the fiscal year 2021 to be in the range of 178 million 282 million, which.
Which would represent approximately 35% year over year growth at the midpoint.
Oh, if we used adjusted total revenues for 2020.
29% year over year growth at midpoint.
In closing, we executed very well and are proud of our strong profit performance, we delivered in our first year as a public company.
We will continue to the power developers and meet customer needs from the work.
Thank you to the entirety of according to him for the hard work.
Last year, and hope you're healthy and safe.
That's the open up for questions.
Yes.
Yeah.
Ladies and gentlemen, we will now begin the question and answer session to ask the question. During the session you will meet the press star one on your telephone.
If you wish to ask the question. Please press star one of your telephone and wait for him to be announced if he wished against smoking request. Please press the founder of house.
Your first question comes from the line of.
Yeah. Thank you.
Please ask your question.
Yeah.
Of Frankfurt for the opportunity for you to ask questions.
For your question from my side the first.
First one is can management share.
The revenue upside from penetrating the audio.
Lifeblood of Cop two use cases of how should we think about the how.
How do you think about the revenue upside on how to quantify that.
Do we have other customer beyond.
A couple of house.
The second question is.
How much is.
A small revenue contribution in the full year 2021 guidance.
What is the organic.
The revenue growth in the guidance.
The last question is the gross margin outlook, because the way have new use cases, new acquisition of et cetera. Do you think the fourth quarter of 2020 of gross margin is sustainable going forward. Thank.
Thank you.
Yeah.
Yeah.
Thank you.
So I guess I'll take all of the three questions on the first question.
First of all we have internal policies from customer disclosure and we cannot comment on particular customers other than what's already disclosed on our website.
So it will not come on any particular customer needs.
With regarding the use case.
Exactly not the entirety of use case.
Uh huh.
Good day with Kirby all day.
Catherine.
The existing use case for a long time.
And obviously with the meat they're happening.
Developments in the area.
We do see a significant pickup in usage.
Uh huh.
Is that sad because of all the price per minute.
The much Oregon median price per minute, so I'll do log cost.
The revenue contribution.
Isn't that significant if you think about it.
Overall the picture.
So it.
It wouldn't go ahead of very significant Oh, I'm, sorry from just one use case of them give them.
So many use cases all of the careful.
Some of the second question.
Ernie E. Smith has a revenue run rate of around 1 million of alert amongst.
We.
For me in the closing stages of the acquisition, we expect the acquisition to complete in the next.
A few weeks.
So with that.
I would say.
At least from your contribution would be somewhere around $10 million.
And lastly on gross margin.
Our current.
Do you is the wheat.
We think there will be for some pressure.
Gross margin in the near term.
We do not believe it will be different from what did I have already seen in Q4.
There are mainly true factor right.
The first factor is the international expansion.
As I mentioned before currently Kevin.
The scale smaller scale in certain markets.
Higher infrastructure cost in those markets our margin is the.
Our rest of the lower.
The markets.
As a revenue contribution from these markets increase that will have the.
Our cost of drag on the overall GP margin.
The second factor is the all the technical optimization well.
Implementing.
So.
In the short term.
Like any of that's the first factor will be stronger.
Half of them you know from pressure on the margin at the we do expect the thing should recover.
A few quarters time at the more and more optimizations and the fact I think.
Yeah.
Oh, thank you.
Your next question comes from the line reached an error for me Pam. Please ask your question.
Thank you.
First question is a follow up on the the new.
Voice model that you've been talking about and just wanted to get a sense of how you actually get paid on that is it fair to think that each room in one.
One of these voice based <unk>.
Social apps of B would be one live interactive audio stream and you could have many participants in that stream that would effectively be free. It I just wanted to try to understand how to think about that.
Thanks.
We actually charged based on per minute per participant so let's say the 10 participants in that room.
There is the 10 minutes of engagements.
So that won't be times 10 of 100 minutes charge.
Okay got it thanks very much on that.
And then one of the things anything you can say about your your new active customer additions had been quite strong for the last several quarters and just wondering.
How youre seeing them ramp relative to pre Covid are you seeing similar ramps or just wanted to get any sense of how how your new customers had been ramping over the last couple of quarters.
Yeah.
Overall, I would say the ramp up is in the normal however, once you're going to need to stress is that.
Similar to what we did was the adjusted revenue and adjusted the expansion rate.
There was this in the short term impact from Covid.
Particularly in China, so during the <unk>.
Write off of the Covid situation, obviously a lot of that.
Apps developers came to the platform and they start to experiment and as you can imagine as called for quickly passed.
Well, it's a developer of entrust and.
The use cases disappear so that would cause some distortion in the revenue and also the expense rate of asphalt as the number of customers. So is that attaches at the.
The.
The kind of the abnormal factor here.
We take that out I think of it.
Yes.
The pretty pretty normal not drastically different from what we saw before.
Yeah.
Got it and my final one is on Opex I was wondering if you could give us any help for modeling in terms of how to think of Opex in 2021 versus 2020.
Either in absolute dollars or in percentage of revenue.
Okay.
We do not provide specific guidance on.
Exact to the operating margin.
As we mentioned earlier, we will continue to invest very heavily R&D, so R&D and then.
The main.
The main component was in.
Opex.
And.
G&A.
The <unk>.
We saw in Q4 is high when you do think of it will be lower than that given we had a few.
Oh, that's true.
Professional fees projects related to security audit as Tony mentioned earlier of his in his opening remarks.
Completed in Q4, so Q4, we have.
Uh huh.
Two of few nonrecurring items so.
So the G&A expense would be lower.
As a percentage of revenue sales and marketing.
It would be.
Around similar levels.
The strength to ship revenue.
Compared to 20 of 2020.
Got it thank you very much.
Yeah.
Your next question comes from the line of Emerson Chan from Bank of America. Please ask your question.
Hi, Betsy of medical and I have the question. My first question is about oversea market.
How much revenue is called scale for both at the in Q4.
And what we see now versus let's say one year ago in terms of customer acquisition and the oversea market.
In terms of course of brand awareness and the.
EBITDA for a week.
And my second question is regarding the Iot use case.
All of the life Cos, we may from before.
Should we think about all of the technology leadership in the or the use case, whether it is less submit the pin.
The U.
Then the video use case.
Or the chocolate in the last day Monday.
And what all compared the advantage on the audio use of Cade that competitiveness in the offer.
And my last question is about the usage of the audio are likely cash use case I just wonder you listen only audience also need to use our T E N.
And what are the alternative technologies that can accommodate those listen on the audience.
The quality and cost of.
Of course, it all out.
Thank you.
I will take the first question Antonio Texas Day.
Yes, two questions. So in terms of our overseas revenue mix.
In the most of his on court in Q4 average.
Revenue from our U S.
The other markets some non China markets.
With R&D close to 70 per cent.
That's the last 120 per ship.
So it's a significantly more of that let's say one year ago of two years ago.
And.
In terms of all of the overall situation in the universe.
I'm trying to market, we have seen developers kind of continuing to be a very strong.
Worldwide the monthly developer registration.
You have to register on the platform also China right now is almost three times as of.
Many of his one year ago.
And if you just do some simple.
Search engine and search.
Oh, the main keyworth that cause the PD.
Uh huh.
The streaming.
You can see that a lot of times, we have had.
All the major competitors. So we have come a long way and we are.
You're much stronger.
The situation compared to.
Well two years ago.
Let's do a lot of them.
Moving to do that.
We recently added quite a few development from frameworks such as the rack NATO partner.
And we're working on a few more and the recently launched the startup program.
Sure.
Pattern.
Help startups to CAD III credit kind of technical support.
Kind of pattern per user.
The hip use cases, so overall, we think we're on track.
We still need to be more proactive and be more strategic clarity.
Solidifying our position as the go to platform for yeah for TEP is what.
Okay, Oh, just a question of their own all the technical or technology leadership, you know the weather.
It's allowed for us to go for it and ordered the new use cases.
The ill about the Olympics.
It's actually very clear to us that the Oh.
Sure.
What was the leadership is not less significant are the only use cases I'll explain why.
Video is commonly known for more demanding the holding in terms of traffic and the CPU usage, but that doesn't mean, it's easy to do because of people are more assistive audio quality for example in the video call. If the video fruit a freeze for like a second or so or something.
Or how has some color blocks for for a second.
Less than ideal, but you won't feel.
Uncomfortable or hartzell continuing of the conversation.
If the auto breaks up for like a second or for a second or there's the sharp noise happening, but in this call than you would have learned much likely to feel really uncomfortable or not able to continue the conversation.
In terms of our vintage the all the use cases.
You know there are a list three of those benches.
Have a per Portland, Kodak to provide a higher quality and we have a much better net worth cover global audience and also we leverage AI technology to further enhance that has the audio experience.
All of our services.
Our portfolio of Kodak called NOAA, which is widely used in todays life cost of use case, where the wide for audio full band audio with road Lope day rate, which is the killer feature for all of the a lot of possibly use cases.
And again, our network, which is called of the Rts provides the best global coverage in this market.
The country, especially of course long distance.
It's hard to really ensure the the experience across the region and worries type of devices and we also use artificial intelligence to improve whereas aspect of audio quality for them.
Example, AI based not nor is the reduction in population.
Hum.
The third question were about the listen only others use cases.
Oh I.
I think it's important to understand that little early.
The use cases.
So called the podcast.
And this the most of the time, but 10 junky anytime to discuss is hugely different from strictly isn't equally.
The need to understand because less of the new used case, where sort of caught psychologically on the audience or the participant feel really different from strictly with the illumina halving of the ability of twin dropped.
It gives people the feeling of being there of being together.
Together the.
Whether the make any response or not.
It means a lot.
The environment and people to come on stage between dropped from time to time, when they hear something they're really passionate about which makes the whole discussion more spontaneous. So that's a word of different from the mill strictly a this is the only that's why we'll see is necessary for such in the states to use.
Our team.
Thank you.
Your next question comes from the line of calling Liu from China Renaissance. Please ask your question.
The commodity management of tensor mm for.
For the opportunity to ask the question I have a just the one on the acquisition of the small with the I M capabilities to be added to the platform.
What do you think of the new business cases, we should actually for cross sell and all of these new business cases for now, bringing some of new customers that we may never of course in the past before and also I noticed that actually before the acquisition of Corporation with Agora is small also all lines.
Overseas expansion plan, particularly in the Aussie of market. So how do we see the potential opportunities the overseas markets.
Regarding the cooperation with E smoothed out in the future. Thank you.
Yeah.
Okay.
All of our sassy acquisition all of the Smart and the addition of the instant messaging API.
It's less about.
Penetrating into customers, we can never penetrate before it's more about offering a more complete and more some of the solution to customers.
At least the same now something we imagine gets it.
Gary.
<unk> expense was the hopper and with customers. In fact is the messaging of yet is was the most frequently requested feature from our developer community. So.
Jim.
All of the actually have used if the App has a video of voice engagement functionality embedded.
There's a very high chance. It I'll also need is the messaging function. So no it was.
Yes.
The platform that's about all we can offer a day.
The development of the customers a more seamless integration of all the features.
And if you're thinking about it correctly the primary way for people to interact in the App.
Basically video voice and <unk>.
So now we have awesome all of these covered so that's really the logic. So we think the season are inexorable.
I think to add a little bit too that the.
<unk> is kind of mentioned the EPS force under a bigger.
The umbrella of Rte EPS literally we've been working on for a long time, it does give us a complementary feature.
<unk> features and more Apis to sort of all of our customer base, which will help customers to more easily to build their actual use cases or their apps all of.
This will definitely help us a lot in growing.
Our our.
Developers the pause on international expansion there are of pasta.
For the small to expand internationally I think with the physician.
The leverage our existing.
<unk>.
Globally, which are proven to be successful in past to further penetrate to serve global dealer price instead of the off in the past more so in kind of developers.
Very clear thank you.
Your next question comes from the line of Eric Wen from Blue Lotus speaks ask your question.
Oh good money for.
That's the answer the questions and congratulations on the good quota of my.
My question is regarding this the other revenues we noticed that the other revenue has grown quite a bit.
Its quota does this represent a tire customers or more customers I assume customization requirements all of it.
Represent the new class of the revenues, we plan to continue to develop in the future.
And if you can comment of what is the gross margin profile of the revenue some very helpful. Thanks.
Uh huh.
The other revenue.
Mainly due to one enterprise customer, where we provide the essentially the same product the same service.
But the contract is structured as a license as you know quite as requested by the customer. So it's booked as other revenue, but essentially it's really the same service.
But given the season.
The one because of what it was one particular customer for actually.
But I'm, saying this will constitute the annual.
The business.
It seemed like this will happen from time to time.
But we don't consider the Saturday anything different from what we already do.
Okay.
Okay. Thanks.
Yeah.
Once again, ladies and gentlemen, if you wish to ask the question. Please press star one on your telephone and wait for him to be announced.
Your next question comes from the line of Eric Kim from China Securities. Please ask your question.
Thank you management for taking my question. So there are three questions from my side. The first one is about the only indication I was wondering can management update us in terms of progress penetrating online education customers.
I think what is the proportion of revenue contributed by small purchase first of March quite day.
And how the the potential market price of Archie I'll application for care in China.
And my second question is about the strategy of credit if you want to make in R&D, but what is the focus of R&D and predictive of what's been currently and what the most challenging part and of course for education and entertainment sector.
Are there any interim data Archie application of emerging from other fields, such as financing Iot and so on.
And my third question, it's about the parent.
So for 2021 and also for the mix of long term, what do you think back to the proportion of revenue contributor to fight over sits at the.
And it would be appreciated if you can talk a bit more about your strategy to develop a couple of markets. Thank you.
Thank you.
So in terms of Oh.
The revenue contribution from different.
Class formats.
Right now.
So the small class is still the majority of format Oh, we have about half of revenue from the small class.
And the other half half.
Train one one used cases and some of them are large accounts are large class of the lecture hall.
But we believe.
Not sure of haul use case as Tony discussed earlier has a significant part of a potential pause.
As Tony explained.
That class one that is most economical okay when tissue a few T shirt.
Teaching hundreds of thousands of students. So the model itself is the theory.
Great and the economics, so we do expect as the contribution from large class of lecture Hall.
Chris substantially in the future.
With that said, we saying even for small class and one of them one class a there is still a lot of growth.
Growth currently.
Currently the.
Overall, the cash market, it's grown very rapidly in China, but globally and secondly.
There are still significant.
Volume.
The usage.
Currently served by in House solutions and.
And we are working hard to convert more of the more customers to switch from Ehow solutions. The professional search party solution.
On the solution.
So that's the first question.
The second one.
Tom Thanks for the technology is the perfect and for.
The only thing the technologies and it's far from perfect at the moment.
Uh huh.
If you actually asked some of our customers they will tell you.
Like our quality.
Relative to competitors are they don't they.
I don't think of the quality is the.
Good enough and absolute from says so.
The quality can be.
20th 70 per cent Badger, Yeah, I'm happy to pass more so is the thinking about use cases like a high definition for K O V. R. A R.
Or for a.
More challenging you just kind of across the.
It's still a long way to go.
And if you think about the.
The use cases.
I would say.
People talk about social of NAV accretion.
But actually.
Under these true umbrella.
Numerous new innovative use cases.
Auto loss cost right, that's the social but that's probably something people didn't do before so even within the two verticals.
I think there are still a lot of growth.
His heart of protect.
What do you use cases will emerge.
By definition right, it's the new.
Because we don't know it yet we haven't developed yet so it's hard to predict but.
As history has shown right people, who always end of it and they need to learn of the need to interact.
We will not go away.
So that's on the verticals.
But we will not just the.
Ah stay as he passed the SDK level and wait for customers to to.
<unk> was also the same time.
Try to articulate ourselves so the application in the past.
Of course of flexible classroom.
Yeah.
The first effort from us.
In terms of sort of collaboration so the smell.
He passes the low code solution. So basically when you do use frictional adoption and allow companies.
The smaller development team.
Oh, let's say more traditional enterprise rather than a pure technology company.
It allows them to be able to a top of our technology and apps.
Apps much more easily and that will expand the here.
The first of all market.
The addressable develop her or customer base and that's kind of also create new revenue opportunities.
That's the second question.
The third question of overseas revenue.
Sure.
This year, it's hard to say given lots of saying the moving including the.
Development.
Development of the Covid situation.
On the way.
We expect the contribution from out of.
China would be some oh, sorry, the higher than what we saw in Q4, so around 70%.
And the we do think.
The I'm trying to market.
Has huge potential given all.
All of the new use cases.
Starting to really.
Around the top end, Ken came probably the Havent already so we do expect to.
Revenue from China to travel.
The news in China from within China.
The two five years.
Thank you.
Yes.
Once again, ladies and gentlemen, if you wish to ask the question. Please press star one on your telephone and wait for him to be announced.
You have the follow up question from the line of Emerson Chan from Bank of America. Please ask your question.
Hi, Matt Eichmann May I have one follow up question on the oversea market I know, we have the cobalt pricing, but as far as like no loss because of the mundane some discount.
So I'm curious of what are the asp's expense in the over.
The rest of the charge off for the discount we give them.
Right.
And how should we think about the combination of intensity for the oversea market.
China. Thank you.
Yeah.
In fact in term of SP in the most recent quarter of the.
Two markets are not that different.
Yep.
Non China market still has a slightly lower ASP.
But it's not totally different.
So I'm talking about the of U S. P C. After discount Asti.
But as we mentioned earlier the.
Challenge is really the infrastructure cost.
The scale in China's eat.
After of capacity in China is much higher so we're able to.
Got a relatively efficient procurement cost but.
In.
All of the China also of the overall scale is not a small price that's distributed across many different.
Many of different countries. So in one particular countries of the scale could be quite small and that caused the C. Infrastructural cost will be.
That's the challenge at the moment.
In terms of competition.
I guess people have sort of thing that recently.
Yeah in terms of.
And to the market, including some of the large companies.
Which we got the thing, okay and confirms the potential of this market.
You don't know the difference.
I would say the.
And I'm trying to yes, the rest of the war market in the.
That's well defined as two shaping up compared with the China in.
In China of the marquee.
<unk> has been well defined primarily.
Primarily by ASP and there are competitors, who compete with asking him walk back to it.
All of that China.
As of we.
Also play a key role in defining the market.
We see competitors from various different backgrounds, and they try to offer some overlapping products.
But murphy, who I can kind of competing.
With everything we do.
Some of them do but that's a bit of.
Did you call.
Some of the voice.
Voice some screaming.
We don't see a lot of competitors.
He tried to do.
The same thing we do that is to power all kinds of all the immersive engagement use cases.
So.
I don't think the market all the China overall is the stool has developed.
Once again, ladies and gentlemen, if you wish to ask the question. Please press star one on your telephone.
There are no further questions at this time I would like to record price in fact, it means the presenters. Please continue.
Thank you everyone of our.
So for each of <unk>.
The all contacts to in that true dock either about the IL. Thank you again.
Yeah.
Okay.
Ladies and gentlemen, this concludes the lease.
Yes.
Ladies and gentlemen, this concludes today's conference call. Thank you for participating you may all disconnect.
Thank you.
Goodbye.
Yeah.
[music].
Okay.
[music].
Yeah.
[music].
[music].
[music].