Q4 2020 BlueCity Holdings Ltd Earnings Call
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Good day, ladies and gentlemen, thank you for standing by and welcome to the Blues City sport.
Full year of 2020 earnings Conference call. Currently all participants are in a listen only mode.
Later, we will conduct a question and answer session and instructions will follow at that time.
As a reminder, here of recording today's call. If you have any objections you may disconnect at this time.
Now I will turn the call over to link linked Kang head of Investor Relations for the company. This call. Please proceed.
Thank you operator, and Hello, everyone will come to Blues City is fourth quarter and full year 2020.
This call joining us today about the MA Chief Executive Officer, and it meets the family Chief Financial Officer.
We released the results earlier today. The press release is available on the company's IR website at IR for.
Below the Dutch state of Dot com as well as from the survey.
A replay of this call will also be available in a few hours.
Our website before we continue please note that today's discussion will contain forward looking statements made under the safe Harbor provisions of the U S. Private Securities Litigation Reform Act of 1995.
Forward looking statements involve inherent risks and uncertainties.
As such the company's actual results may be materially different from the expectations expressed today.
For the information regarding this and other risks and uncertainties is included in the company's public filings with the SEC.
The company does not assume any obligation to update any forward looking statements.
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Hello.
Please note that during today's call management will also discuss certain non-GAAP financial measures for comparison purposes, all of our GAAP results and the reconciliation of GAAP to non-GAAP measures can be found the ehow.
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Also please note that.
Other that unless otherwise stated all figures mentioned during the conference call I'm trying to sort of maybe.
With that let me now turn the call over to our CEO, Mr. Bough Lima missed the malware.
Deliver opening remarks in Chinese other than translate his remarks.
After that our CFO, Mr. <unk> will take over to discuss our business and financial highlights.
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Thank you Lynn and Hello, everyone. Thank you for joining our earnings conference call today, we had an exceptional year in 2020 the.
Despite the challenging COVID-19 environment with the mens focused on our growth strategy and achieved encouraging results.
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First our NASDAQ IPO, what the remarkable milestone of our long journey.
Funding our predecessor download website over 20 years ago, we have prepared for the recognition and social acceptance of the LGBTQ community.
Being a public company will further broaden our user base and help us to connect with the LGBTQ community globally.
We believe we can make a wider and a meaningful impact in the road with our unwavering goal to create value for society promote diversity and foster a sense of belonging for our members.
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Second with demonstrated the strength of our portfolio strategy.
We can pull different levers quickly, which makes us agile and able to grow faster.
For instance, we acquired and the quickly integrated the last two and its income in cloud operation.
The rating our experience and technology those acquisition strengthened our leadership position in the LGBTQ community.
After acquiring less due in August we quickly introduced a new version in Q4 as the readout by February of this year letters and the EU in quick three one times since the acquisition.
Meanwhile, <unk> reached a historical high of 730000 in December representing 15% growth in one month since the acquisition and.
In the fourth quarter of 2020, our total monthly active users of our portfolio apps reached.
$7 6 million.
The two acquisitions were the beginning of our multi brand multi demographic strategy.
They enabled us to leverage and optimize our technology and operating system to support <unk> recognizable brands and provide differentiated services in each specific group of our communities.
We intend to accelerate the growth of each brand and the belief.
They will soon make meaningful revenue contribution.
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Third we regularly evaluate and adjust the other global expansion strategy based on the geopolitical situation and local communities of isn't it.
Each region, we cut the we customize our offerings.
According to you the behavior and of the needs of the local communities. For example, we introduced a major update to the blue the mobile App in Latin America, which generated positive feedback from local use at the.
By February of 2021, and the you had doubled since the launch of the new version.
Reaching record highs in both Mexico and Brazil.
Looking ahead, we will continue to introduce more localized and the diversified services tailored for the local community.
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Fourth we improved our organizational structure in order to maximize our operating efficiency and productivity starting from 2021, we reorganized our company from other functional structure to a business unit our entity structure debt.
Sales in April our Bu leaders the act quickly to the dynamic changes in the.
Online social networking industry and of the LGBTQ community.
And more importantly, it will further accelerate are part of innovation and optimize our product offerings.
Furthermore, we attract and retain great talent to support this new organizational structure, we have two new WAC of precedence with 10 years of experience focused on internet enabled the product user growth and global expansion.
The real late domestic and overseas business, respectively, and manage the whole operation together.
We look forward to the working with them closely and benefiting from their valuable insights and extensive experience.
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Finally, I want to mention our effort in corporate social responsibility of CSR metric one of the most important aspects of our culture.
Our founding we have been dedicated to creating value for society and promoting diversity into the last year. We were honored to be ranked as one of China's top companies for corporate social responsibility as compiled by the China. The S. Amateur Research center more recently.
Cited and honored to be the first person from China mainland to be recognized as the outstanding of Hanger LGBT exactly the lift from involve a global network and the consultancy campaigning that we're seeking and inclusion of debt on it.
This remarkable accomplishment.
Complishments demonstrate our commitment to CSR, we want to make this a better tomorrow for everyone and we believe our greatest impact out of the world will come from our group, our growing global presence and associated CSR efforts.
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Now, let's move on to our growth strategy in 2021 four years, we have consistently executed our long term strategy. Let me give you some updates of our latest thinking.
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First we continuously enrich our products and service offerings to engage and QD rate our community of more deeply we're committed to build our booth at the comprehensive community platform through offering more radio content and promoting community function to drive of engage.
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Making the Nike training of the more attractive through innovation and offering more options for membership services with.
With led to an income we are investing heavily in technology and the marketing and elaborating on the strength of our product portfolio to expand our user base and a true faster revenue growth domestic growth is the fourth pillar of our growth strategy.
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Second we are expanding business overseas.
We are in the early stage of global expansion, which leaves us plenty of room to grow.
We will drive growth through entering new markets and strengthening our leadership.
Existing market set.
Latin America, which is our focus for 2021, we will continue to localized product offerings and run various online and offline events to quickly attract youth.
With further accelerate monetization in mature overseas markets, So well managed with the live streaming operations and better pricing of membership services.
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Because the product is more appealing to younger generation and we hope we can achieve meaningful progress in the second half of this year.
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The other servicing service strategy from the planning to strictly health related products and services.
Family planning business never been great traction well.
Well health related service centered on HIV prevention and treatments have huge potential.
We believe tea house of a well recognized the house related service can be the income for our next phase of growth.
In Q4 revenue from key health increased more than eight times year over year, reaching 11 4 million, we intend to obtain an internet hospital license and build a comprehensive diagnosis and treatment platform from men's health.
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Now, let me turn the call over to our CFO Ben.
Who will provide details on our business and financial performance.
First of all.
Thank you everyone for joining our call today.
For the fourth quarter total revenues were RMB 200, and of $78 9 million up 24, 2% year over year.
We remain committed to enhance our monetization capability and the diversified monetization methods in order to generate sustainable growth.
We are pleased that our revenues from membership services and the hills continue.
Continued to achieve robust growth in this quarter.
Monthly average users on the blues grew by 12, 5% year over year, reaching $6 6 million.
Out of which 47% were from overseas.
Most of the active users on our non blues of.
Reached 900 and the 80000.
Are you or any of you for this quarter on the blues up remained stable at 44 per cent.
Total current users of the blues up were 518000 up 37, 9% year over year.
In addition to our solid financial growth.
Also made meaningful progress in product innovation.
We launched a voice chat room function of the blue that the mainland China.
Users can join the rules would have real time community Fuchs to audio conversations with other members of your preferred the language friends and interest.
We believe the dysfunction, where revenue with users.
But the full rollout sometime in April.
Meanwhile, the exit first of all expenses are of course going in.
For our community of users is expected to launch by me very true.
Together with the community of future and catch function that we introduced in the last quarter, we have been relentlessly devoting resources to product innovation that improves the user experience.
Sales of balls of our community.
We continue to drive LGBTQ awareness.
A recent example was the lots of Love go home campaign.
Logs to coincide with the typical family reunions activities of the Chinese new year holiday.
This campaign helped our community members to find a greater sense of belonging that's home and cultivate more acceptance from family the breach.
The GAAP between generations.
On January 30.
We live streamed online rove around the table session between the Napoli good income.
Or any of the mother, who together kind of it can be discussed these experiences and the announcing him.
All of our density.
The March we also partner with you and as well the zero discrimination campaign.
Things too and discrimination and the quality and the Asia Pacific region.
Lucy brands, such as Blue led to finger.
And it's the public interest together most of the opposition to prejudice of all current.
Specialty based on sexual orientation and agenda identity.
The campaign was executed of using a combination of seemed the posters interview with experts like broker.
Short videos.
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The successful events increased our visibility and the strengthened our dominance of leadership in the global LGBTQ community.
Going forward, we will organize the participate in a wider variety of social and the public events to promote LGBT acute awareness around the world.
Finally, I want to note that our enhancement of corporate governance.
We are currently upgrading our ERP system with Oracle Ebs.
With the street, which.
Which streamlines the process facilitates the information flow between all business functions of finance reported based on a well designed the control infrastructure.
We expect the this project to be completed in the first half of this year and it will improve our overall efficiency and of it.
Equity of financial reporting.
No.
We'll go through all the financial highlights for this quarter.
Before I go into details. Please note all numbers presented are in RMB and are for the fourth quarter of 2020 the labs.
Thank you the otherwise.
All percentage changes on a year over year basis, unless otherwise specified.
Detailed analysis is contained in our earnings press release, which is available on our earnings release as well as our IR website.
Total revenues increased by 24, 2% to RMB $278 8 million.
Driven by better monetization of our diverse services offerings.
Revenue from overseas contribution.
Five per cent of the total revenue increased from $5 one per cent and the same periods of last year.
Quarterly paying users on the blue the App increased by 37, 9% to 518000.
Revenue from lots of drilling services was RMB 223, 9 million up 18, 7%.
Mainly due to more paying users and the higher average spending per user of luck streaming services.
Our quarterly paying users for live streaming services increased eight 6% two of 144000.
Arpus or RMB 1550, an increase of nine zero percent compared to the same period of last year.
In the fourth quarter, we launched the new large streaming strategy, let's drive the engagement a large group of our middle layer of long tail users with limited spending power such as promoting the new features to enhance the participation.
And developing more.
First the purchase of incentive features to cultivate the paying habits.
This new strategy complements our current high spend the program and provided the differentiated of diverse options to different cohorts of users.
On the supply side of luck dreaming of invoicing.
The voting more tenants agencies kind of promoting more individual large streamers to join other kinds of agencies.
The initiatives create a good ecosystem for consistent improvement and producing higher quality diversified of content and in turn to attract and retain our users.
The adjustments of strategy brought temporary pressure on our short term performance of loss range of services.
But we believe the strategy provide.
<unk> solutions and it will pave the way for a more sustainable model, which can be exported to our oversea market and the other product portfolios.
Yes.
Revenue from our membership services was RMB $22 2 million up 46, 5%.
Our quarterly paying users for the membership services increased $51 five per cent to 415000.
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Part of me 400 in the 15000.
While the Arpus you walk RMB 53, six roughly flat compared to the same period of last year.
We expect accelerated growth for our membership services as we drive most of Asia efforts in both domestic and overseas markets.
Revenues from advertising were 19 point of view.
<unk> up $35 four per cent.
Other revenues were 13.7 million up 100, and the eight 7% driven by growth he held merchandize.
Cost of revenues increased by 29.0% to 200, and the $9 3 million.
So <unk> is composed mainly of the revenue sharing costs and the commission costs the.
The increase in <unk> was primarily due to two reasons.
The seasonal effect is usually share of higher incentive to streaming of jewelry our unions of events.
Specialty for the year to celebrate our successful IPO, we offered and even the higher year end the bonus to our best performing kind of agencies of the last streamers.
Of the special tax.
Second as.
As we mentioned the new strategy that we launched the luxury surfaces.
Which resulted in higher cost.
However, we believe it will generate the higher lifetime value and increased transaction volume and the frequencies.
We expect the those investments will be paid off in the second half of 2021.
Gross profit was $69 5 million.
11, 8%.
Gross margin was 24, 9% of compared to $27.
Of the same period last year the.
The year over year decreasing the gross margin was mainly due to the relative slower growth of live streaming service revenue.
The one time lots of drilling related costs for this quarter.
Operating expenses were $143 6 million of 82, 5% due to increased selling and the marketing expenses and the staff salaries.
IPO related share based to accomplish this year.
Selling and marketing expenses were $49 7 million up 56, 7% due to higher advertising and promotions in the overseas markets and increase the head count in sales and marketing personnel.
Technology and the development expenses were 17.
Excuse me.
$37 3 million up net.
Zero percent.
The increase was mainly due to the increase of staff cost in technology and the development personnel.
G&A expenses were $56 5 million up $345 five per cent.
The increase was mainly due to share based compensation expenses.
That's well of increase of professional fees and the staff cost.
Net loss was RMB $73 1 million compared with the net loss of RMB seven 2 million last year.
Adjusted net loss was RMB 36 zero million compared with adjusted net loss of RMB 15.0 million last year.
For the full year of 2020 of total revenue increased by 35, 9% to one point of 3 billion driven by the increasing the total paying users of our online services and the diversity of our revenue streams.
Gross profit was 311.0 million up 46, 2%.
Gross margin was 32% improved by two two percentage points from 28.0% in the same period last year.
The increase in gross margin was mainly benefited from the reduced the luxury of revenue sharing percentage and as the higher revenue contribution from membership service.
Net loss from 'twenty to 'twenty was RMB 200 end of 'twenty, one 9 million compared with net loss of RMB $52 9 million in 2019.
The increase was primarily due to share based compensation expenses related to the IPO.
The adjusted net loss from 2020 was 39 9 million neurons from the adjusted net loss of RMB $52 9 million in 2019.
As of December 31, 2020, we had cash and cash equivalents of term deposits of RMB 600.
The $11 8 million.
Compared to RMB 300.
$80 3 million as of December 31st of 2019.
Now, let me talk about next year's guidance.
We expect our revenue outlook of RMB 141 billion to RMB 146 billion for the full year 2021, representing a 37% to 42% year over year growth. However, the year over year of growth for the first quarter of 2021.
We will remain relatively slower primarily due to our newly adopted the new downstream strategy as well as a large increase in the number of paying users first of quarter 2020. During the COVID-19 outbreak, which resulted in an unexpected revenue growth.
We expect of the robust revenue growth will resume in the second half of 2021.
Well.
That concludes our prepared remarks, let's now open the call for questions. Operator. Please go ahead.
Ladies and gentlemen, we will now begin the question and answer session. If you wish to ask a question. Please press star one on your telephone and wait for you need to be at home.
Wish to cancel your request please.
From the pound key.
Once again, it's sort.
And the number one on your telephone.
Your first question comes from the line of Laura Champine of Loop Capital management. Please ask your question.
Yeah.
Good morning.
My first question is about the changes to live streaming and could you be more specific on what the expenses were related to those changes.
And in what way do you expect that to increase.
Life time value of of your live streaming customers.
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Yeah.
Okay, Hi, Laura.
There are three points regarding to your question.
The first one is that actually of comparing to the percentage of revenue sharing.
With talent agents, usually the ordinary person I like the ordinary streamer share of lower percentage and what you intend to increase that.
Two days.
Actually tweak to the increase the engagement from the ordinary streamer.
And in China.
More of them.
That will attract more users to join our platform and hopeful that we can improve the number of paying users in the channel the search.
Is that actually we are inviting more agent talent to join our platform. Currently we have quite limited number of pay the agents.
<unk> is our platform and the <unk> gateway, we are going to buy more agent talented pay the agencies to provide more of kind of professional and high quality content or lack of Jamie platform.
The third is that before you know from.
The revenue sides.
From the revenue side way actually the revenue of recorded a recorded from the paying users what Youll gave thing and we are we are in Chengdu launched new features to the streamer side.
Generating the revenue from the streamer side outlay true. They can you know through our platform. They can purchase a lack of promotion choose to increase the traffic to their own channel yeah. That's the three points.
Yeah.
Thank you and last question on the launch of your business in Latin America, how will that compare in terms of.
The push initial push compared to your app launches outside of China into other Asian countries.
Okay.
Laura I'm, sorry, we are not quite fully of clearly the case.
Repeat the question.
Sure you're your initial advertising spend or your initial launch spend to launch Latin America, how would that compare with your initial spend when you launched blue cities apps outside of China into other Asian countries.
Thanks, Laura I will translate the question.
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Mr Mark the Altair.
First of all right actually you know for every new app into it entering into new markets. The initial launch of it.
It's the most difficult.
The most difficult part, okay, and the way intend to spend more on the initial launch and after that Wesley.
Once we gain the days of care.
The patients we can easily spread our brands and to attract new users through word of mouth.
And we at the way as.
We are in the leading share position in that.
Southeast Asia, and we can quickly.
We can quickly.
Average of the marketing channels into Aladdin.
Latin American market.
The actually the marketing channel so quite similar to the south.
Two of the Southeast Asia market, where you really tend to use Facebook, Google channel as well as as well as running offline events.
With the local with local agencies.
In terms of the average spending with the that is kind of made of layers in the middle of between you know other.
Our high net loss countries such as Japan.
Japan Korea.
Such as Japan Korea, it's like the middle range Okay.
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Thank you I would translate for myself Cleveland mention of and thanks for taking my question. So.
Notice of how revenue growth slowed down slightly for Q1 of our.
<unk> 2021 guidance imply a growth acceleration of.
This year. So just wondering can you talk about the growth strategy this year, especially for he held.
Mentioned is going to be our second growth engine. So can you talk about the required last month and this is in this business and they also talk about to achieve the.
The revenue growth in our guidance what.
Investments do we need to.
Due this year and then my second question is about and the Ace strategy can you also talk about of M&A strategy. This year compared with last year and then a web.
Our target the.
The place that plays in China overseas market do you spend all of.
The international footprint.
Yeah.
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The other countries.
Gotcha.
Thiago and T shirt.
Okay.
Sales for the first question regarding the growth strategy in 2021.
I will answer this question for Pat.
First is the <unk>.
Monetization opportunity overseas and we see a great potential Oh, this market, especially in light of training and the weather and the membership services.
Before that we are in the by the very early.
The stage of monetization overseas and we really have the opera.
Operations in light of training and provide more membership service products and offerings to acuity of age.
Paying habits of our fifth year of it.
Therefore, with the of huge potential of revenue growth overseas.
<unk> is the revenue contribution from fee income.
And one of them.
After like three months of integration with fee income with some of that there is the pew plenty of room to grow so think of the business, especially.
In light of training and the membership services.
With some of that based on seeing cuts the user profile they have a higher.
Hi of willingness to pay for high quality of service at current.
Lifting costs revenue structure tend to be more healthier, it's like more than 30% from lack of training.
Around certain percentage from advertising and another 40 per cent from.
Membership services.
Therefore that leveraging all of our.
Financial support and the technical technology support we will offer more features in lack of training and in membership services.
To drive our paying ratio.
Of being caught you with it.
Yeah.
Third is that we would continue to see that the huge.
Huge growth opportunities in Blue membership services.
At the you'll know that membership services.
The recurring revenue and the higher and have hired of wealth market.
Well the loyalty membership services, we will offer more interactive features we will adding more features two of the behind.
Behind the paywall trying to acuity rating, our users' paying habits and income increase the paying ratio of power users.
Force in the late it is our is as you mentioned or is our ski house strategy. He house with internal labor weighted position he house.
At.
As Kim.
It's like that he house will be our.
The driver of <unk>.
For core of everything it flipped the.
The opportunity for he healthy it's huge.
We started from HIV related with docs slumped, providing a kind of related services and zone will become quickly and that's the way it service scope into more housing privacy related services.
And into.
Well being of mass house.
We see that through the partnership with pharmacists and pharmacy manufacturing of pharmacy, we can easily takes leverage of the pricing.
Pricing on the pricing of course.
Negotiation.
And with the that and right now we currently.
We are going to obtain even of the Internet Hospital license.
In the near future and we are pretty confident that we can build a comprehensive math house platform and rapid ramp up that business that real quickly.
No what I put on in the jargon cheek when you get towards the bingo. The you said you are one of the drip on until the June D did uncle sitting at Homeaway. She one of them got on watch and show the Shan Shan Shan Shan Shan the LGBTQ range and so it really went out of the town. The ruble number of women that she would take care of ensuring people to go change the me too.
See the Shanghai for the Tony the some of the Italian the down the goggles. So you know of minutes, let me.
Once you go out the ECA Youll you women in particular are going through the granting of junk food E. G. A number of put on one day you will be in here, you'll go to share from the town that you ship a glimpse of the bingo the down the two quick one channel when me at ITT Gold Homemaker Walker of Bank auto should hone this year channel.
The <unk>, she won't who have been going on and go into the computer should something of a luxury agenda goggles for the engine.
Tissue.
Well for the second one.
Yes.
Sorry, let me translate the ounces.
Thank you and force.
Is that based on lack of ambition and that way of change would be.
Our comprehensive last handful of lighter for the LGBTQ community. So we chose our.
The addition target more carefully 10-Q2 sales.
Pocket share of the stabilization with that.
And so of that.
We keep an active dialogue with other potential.
Acquisition targets in America, Japan and Europe.
Europe.
<unk> of good dialogue with them and seek for end of kubernetes. So that we can work closely together through partnership or other forms of M&A. Thank you.
Okay. Thank you.
Your next question comes from the line of Brian Lee of E. M. P. The global markets. Please ask your question.
Thank you for taking my question Congrats on your solid in the fourth quarter results. My question is about the.
The two are successful and I and then the idea was last year.
As you have included the M. A use in the latest reports so could.
Could you please add more color on the integration plans and the one where you expect the company benefits from the synergy of cheap the M&A deal. Thanks.
That's the thing.
Well the wasn't Heathrow Algeciras, Outweighing Shah Junior and Oh, Gosh, I think of a show called a wash I wouldnt want ease of insertion.
Well I mean.
If you can share with you that you got to of course, the Tijuana a hold of.
Im doing well consider that got you to use the Montreal Coker.
Oh, you shouldn't do the Ah shall go into the holiday the shekel and show you the sheets yet.
Oh, she didn't even know NT traditional momentum. So you can take a lumpy I think all of that kind of time of the year within the channel when we see it kind of all of them allergic goes to the towards the ambient union of function of Gulf of Mexico border I have to be the coach and he was telling me of Italian it did improve the sheer gentlemen, I don't have the shelf or when the judge at all of our in our Union artisan, let's do.
The will be so going to show you that sometimes the Sunday EBIT number.
The phone call it.
One of your day to day Shari is in total Alicia the Cingal Cheetos I love. The Yulia interest you and this will go on the doing all of them. The Shaw she's on the old Miami of PLO.
How does he or she would you.
The T shirts and value.
It'd be back of an issue of it sometimes like in the door.
Well, they're going away a T shirt timing of if you didn't the bunch of if what I can do the algebra you didn't get into the.
The two day could be building aegis assure you may well know by chance of 90.
No equal in time, Penuchle forecasts of Toyota I would it be the children shoes, Oakland Antonio home book, when you can't puncture of the bulk water because that's the central I'm sure the even dividends from the Thai you're seeing how do you all day, along the time of the future you should put on the.
The bulk of them because of either from.
Can you just talk to any of your time keep so you go out to be true I ought to be true.
The table you in payback from the time can you share.
We appreciate your.
The took a chunk on paper in the future of the U K.
So each one of the town of <unk> chicken with which you go down the Eagle Ford and I think the time in the jump off I mean, you've got I'm quite answer of placed on channel. The kitchen of the one that really dominates the time penuchle bundle and the figure I can pull it out of the between cheap Oh well neighborhood of you could take a took the name.
There you go cohort, which will actually be teed into the to the match group took the cone core but all of the time computer forgotten, but formulation the lunch and put on the diets either into the I would give me the full range of tissue for women.
So your woman Yeah, you anyway.
Two of Hall of Fame hop Aqua shrinking the bogie of how you do it I can't I had the flu highlights of the time he called it on the C met Anthony.
Hello, Kitty bundle of now what you can do the I don't even hear ensuring the trench of the particular chocolate change out of the lunar.
As you know women the Shanghai the bunch of out of some of the pinch in the downturn of course, all in the book in the call.
Sure.
Thank you for your question, Brian and let me just the simple translation here, yeah, well actually we're quite pleased with the integration of being kind of net to.
You can see that the Mou growth of being kind of net.
We're encouraging okay, you can see that quit and we haven't disclosed the latest.
I mean use of Fintech, it's like it's.
<unk> reached.
The higher compared to the end of last year, So it's like that.
It's like that.
Our portfolio strategy has proven to be right and through our portfolio of stock D. We can sell more usage.
The more kind of more users all the way you can't expand our user base and each of the hour part of portfolios were punishing them quite differently twice. So price itself more different group of users. For example, we will quickly launch another voice day.
Uh huh.
Called volume and to try to cover more users who like to use the voice based.
Yeah.
So internal a week with the aim to be the.
The match group in the Al GBP kill community and we are trying to launch more.
The new App, new feature try to cover <unk>.
Try to cover of Ann.
Different groups within the LGBTQ community.
You.
Yeah.
Thank you.
The last question comes from the line of Austin model of Canaccord Genuity.
Question.
Yes.
Hi, Thanks for taking my questions within live streaming can you talk about which products have the most meaningful revenue contribution currently and what new products have the most of the potential for growth going forward.
Oh two transmission none.
Net of infusions.
Think of often that's not enough to hear you again all of this is Ben and I will do the translation to Mr of my first.
Part of him and pieces of look take a true for July syntax, you've kind of Negro sugar in the in country choosing the dose and if at all of hard to shipyard among all of them.
Geez I realize other triggers.
Yeah.
Sure sure Yahoo go to a true to your channel either.
Maybe I'll call, that's what I'm Gonna do you usually have to actually take the sometime down the income the man.
So I'm sort of equivalent of John the Parliament and the courts on combination of $2.
Julie.
Hi, Austin This is Dan I'll, just do the transmission of myself. Okay makes the mark just to explain that a pool for existing revenue part of that to the apart from the loss of dreaming, he deemed or the management of beams knocked out. The membership services revenue is going to is is actually picking up very majority.
Are important.
So off of now and the full future the most of the potential of.
The impact to revenue service Pi contribute contributor is coming from the house health related services offering.
And then sends from I've.
I think you got 92 billion of kind of hard from without an EBIT of one I think Angela on.
Of the Florida take our dice and the channel Fucci, who should really not familiar with and get on the table.
On the go from downtime of sure you're all function from you all.
Yeah I forgot.
About him being quoted Gencon digital channel.
Thank you Peter good Taco to nil, so the woman shrunk the tiny.
The TV, that's the the materiality of Atlanta, Google about kind of central to sales.
The $2 six or anything you could share.
It will show up next year, the Dupont pioneer she was one of the industry trend.
So the 19 inch and the.
So some of them once you begin to do the when it went from two to five.
Regarding the so called the house related service is actually it is mainly related to private treatment for men of hearing China. So currently we do see the HIV related treatment for the pre the.
Prophylaxis.
Exposure prophylaxis in the.
Post.
The treatment et cetera, actually that the the HIV.
Community here in China, we had our internal analysis ease of around 1 million 1 million population. So we do see it is going to be a huge because you know people have to taking lifetime of drugs to get them get a qualify the treatment. So we do see it is going to.
A recurring revenue and about the entry ports for us to get into Theyre not to mention that you know HIV treatment. He's the only of start who are the primary treatment of come out of here in China and also other you know and demands from from US on like you know the Harry issue.
The sexual malfunction issue et central Austin.
Thank you for that just following up a little bit.
What live streaming products drive the most live streaming revenue.
And.
What are some new lifestyle products, we are excited about it.
The interest in crafting of our two might translate.
I'm asking really is going on to the ones that I can assure that to the border to the Italian yet tempting the wheel goosing. The true good so you want before filing the shelf.
Since you introduced it in country.
Sort of to be the new home sales.
Well, then my house, Sean Kang of Qunar, Charlie I'm hogging them.
And one of the dog iOS, which of one or two board kind of create that one between price and called my promise to you one of the hallmark of Triple agenda. The Homer Jonathan that's total of how much of your progenitor of Hadoop. We went for the honeymoon such as yourself of how the hallmark of it didn't go down the hall. She could you quantify how did you push any of the lifestyle fashion.
The holiday shopping.
The controllable non traditional in the hydrogen extra suite of teaching sounds like on the go to the Tomo Township.
Austin.
We have to say you know this so called virtual gifting model philosophy, I mean, you've kind of flow.
Existing four years, so we keep innovating by developing new features trying every effort to figure out what to do to better leverage of our position for live streaming revenue service contribution to our revenue pie and the what leaves tomorrow exploring the only one example of that Oh, that's two minor okay.
Because of his earlier speech was also mentioned as you know currently our revenue mainly from the people who per.
The virtual gift of platform right, so actually the leader of.
Sooner or later, we are going to develop a new feature of that is actually.
The luxury months might purchase some services features from the platform so basically.
We are telling you that we are going to just not doing the monetization from the viewers. The audio side, but also from the left from my side. That's number one number two of Mr. Joseph The AD is not.
Uh huh.
For example, we're going to create some interesting functions like you know I'm thinking the like the number of the June number you know you know how important sport usual number.
For the Lucky trial here in China, right, you know number of snakes number eight meaning Lockheed et cetera. So we're going to give up something like that sort of you're picking the bamboo. So we're keep innovating from time to time, yeah Austin.
Okay. Thank you that's very helpful.
My last question is regarding competition when you launch into new overseas markets for.
For example, in Latin America, where you're focusing in 2021 day.
Typically find.
One two.
Well entrenched competitors.
That are already there or is it typically a very fragmented market that doesn't have.
Any scaled competitors.
The C V answerable, but anyway on TV, the due to a whole bunch of syndrome.
All of them that argument on the Internet at home, if we kind of.
Good luck of the Sungard in conjunction with whoever wins out of the HIFU for Sukhoi. The first on the cell lines that are really doesn't matter of fact.
Well then just leave you made when you go to all of you and you're sure well known fashion.
Do you notice all of the.
The good yard you wish at home.
We won't see the out of Chicago.
With the group C. When the enemy.
Actually most of the grocery shops, you found that it actually would you take the Lula Li Hello, sometimes the Tijuana when the assembly in June of that you know the shoulder.
So that I think of it.
So you can call the take up you've learned do you simply don't yet, but when the negroni out at all.
The Jim can take our time in the Beaumont the deep honestly the woman threshold of.
For the laundry detergent, where she wanted to take the allow me abandon the bloody Truecar channel will come true.
The young until the time it sounds yeah, that's one driver.
Three of the Sudan are politically you win one of the sometimes they even thought at all about in Dubai with some commentary the ebay so well near the tail end.
The true reality to us from Columbia D. G about the issue of having to take the feet on the type of Uh Huh ballroom.
Of all the iron ore tons of how much acreage mentioned are true.
In light of day to answer your question. What you all are well you get a little hot.
So you know when they're going away. So anyone of you go one GAAP you'll use it to the other one.
Like the chute hungry man.
Some of them again.
Now with me wishing him a lot of me too.
It's the way of women the are going into Chicago, and Washington, The Thiago your daughters won't one of the selection of Hollywood law not sure now well then the go quite so let's wait until the top of our top of what the.
The Shaw asking actually.
In Latin America, the only one named actually the film.
Famous the USPI to comparator of all of us.
Already there and the due to the population you know you know Latin America of having a large population of over the year and also the.
User behavior.
Lots of product towards kind of very popular already on site. So basically.
Come on or are we entering two of those new markets.
Have to deal with it very carefully stocking from the market analysis, you know we.
The view, we engage with third party consultants on the standard you know the user behavior of engagement.
Based on those local players and the local users.
On a general matter and also we identify those gaps are the demands of the users locally have not been satisfied by the existing player. So back to your question directly that's the only one meaningful.
Peer in Latin American market, yet still there are some came out of that we see we do see a huge opportunity we could do something meaningful over there in general Austin.
Okay. Thank you very much for taking my questions.
Sure Okay.
Right.
Okay.
Okay.
Uh huh.
Okay, I think first of all operator.
Yeah.
We are now at the end of this call. If you have more questions. Please contact us by email directly. Thank you, let me turn the call back to Mr. Li for closing remarks.
Thank you operator and the thank you all for participating on today's call and for your support we appreciate your interest in the look forward to reporting to you again next quarter on our progress.
The gentlemen, this concludes today's conference call.
You may disconnect your lines now.
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Okay.
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Yeah.
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