Q4 2022 Lizhi Inc Earnings Call

March 16, 2023

Speaker 2: Hello ladies and gentlemen. Thank you for standing by for Leisure Inc.'s fourth quarter and fiscal year 2022 earnings conference call. At this time, all participants are in the listen only mode.

Speaker 2: After Ms. Schmitz remarks, there will be a question-and-answer session.

Speaker 2: Today's conference call is being recorded.

Speaker 2: And now I'd like to turn the call over to your host, Effie Kong, Head of Capital Markets for the company. Please go ahead.

Speaker 2: Thank you very much. Hello everyone and welcome to the Inks' fourth quarter and fiscal year 2022 earnings conference call. We released our financial and operating results via news wire services earlier today and they are available online. Participants on today's call will include our founder and CEO Mr. Marco Lai.

Speaker 2: Our COO Mr. Zolong Li and our Acting CFO Ms. Chenfeng Lu. Mr. Li and Ms. Lu will begin with prepared remarks. The call will conclude with a Q&A session. As a reminder, this conference has been recorded. In addition, an earnings highlights presentation and a webcast replay of this session will conclude.

Speaker 2: of the U.S. Private Secretive Litigation Reform Act of 1995. These statements technically contain words such as make, will, expect, target, estimate, intent, belief, potential, continuum, or other similar expressions.

Speaker 2: For overlooking statements involving time risk and uncertainties, the accuracy of these statements may be impacted by a number of business risks and uncertainties that could cause actual results to differ materially from those projected or anticipated.

Speaker 2: many of which factors are beyond our control.

Speaker 2: The company is a failure, advisors, representatives, and underwriters do not undertake any obligation to update this for looking information, except as required under the applicable law. Please also note that the recent press release and this conference call include discussions of unaudited gaps by national measures.

Speaker 3: Thank you for your attention.

Speaker 3: ok now working that they are lead to the context CAn't easily like this. Su in the con the total lement. They are V pcing the gunp here.

Speaker 3: Cycl conveniently SH

Speaker 3: Thank you for your attention.

Speaker 3: Which a iranone who facing can your father, vieill?

Speaker 3: Thank you for your attention.

Speaker 3: adicharging. contaminating a hundred walks.

Speaker 3: The new

Speaker 3: Look, Anna.

Speaker 3: tried an experiment on a mobile device and tested it very well. Also we trust in online apps. We set up some standalone light displays thatnice in-IES and around the Wearyine devices in the morning. Ultimately I think we're doing Ok descending In the morning we hope to recover our short-term data, track safety and performance. We are ready and are about to recover and and

Speaker 3: Thank you for your attention.

Speaker 3: we would like todefe left side

Speaker 3: The Juntarily L

Speaker 3: disappeared in the first session

Speaker 3: Thank you for your attention.

Speaker 3: Wegood night and happy changed the torpedo

Speaker 3: Thank you for your attention.

Speaker 2: Hello everyone, thank you for joining our fourth quarter and the full year 2022 earnings conference call. First of all, on behalf of the Liq Ching, I would like to express our deep gratitude to all our shareholders and investors for your continued support.

Speaker 2: In the past year, despite the challenges posed by headwinds in the global macro environment, we remain committed to steadily promoting our global business development and expanding our diversified product matrix at home and abroad. We also strive to harness the power of technology innovation and the power of innovation in the global economy.

Speaker 2: and integrate the latest advancements of cutting-edge technology into our business. At present, we have applied voice AI technology in various existing products and launched an area of innovative AI features, including chatbots.

Speaker 2: Going forward, we will continue to upgrade our technologies and product features and advance the application of AI chatbots in our products. We aim to provide users with innovative, online social competitive experiences by building an AI chatbot platform and creating more engaging, more engaging, more engaging, more

Speaker 2: fun and interactive AI travel usage narrows the foster emotional connections, ultimately promoting our global business development.

Speaker 3: Ping ER Ian, a woman, a yeo. We K tise replacing in qvata qualy.

Speaker 3: We'll post the reports on ourigh.com page, or go to our website planning journals and questions from the Leanlaughouts panel.

Speaker 3: You could didn't have done without us. Q? zào le, q? y? z? j?ng y? x?o r?.

Speaker 3: this camera capability can be computed by a tablen. Please press the link to Simon truck's upload animation and languagePurluaj. You can see my video aboutagency theque. mal

Speaker 3: For many assion are initi. The staf itizen.

Speaker 4: Sorry.

Speaker 3: Thank you for your attention.

Speaker 5: Thank you for your attention.

Speaker 6: ple tell me the peopleen yes to the woman died, sanga P the jes is a.

Speaker 7: vjis masaksolobe Y suchukan qui amandidas Cha.

Speaker 8: Thank you for your attention.

Speaker 9: time I

Speaker 10: Thank you for your attention.

Speaker 11: is Then down to ity.

Speaker 12: Can you hear the Maoli? Listen to the speaker's voice. Do the partner sound yourself?

Speaker 13: Why theflamec Harrison? You were shot out. Why theflame interen

Speaker 14: pieces of digital media and the assessments can be pieced in

Speaker 15: Wuhan ?! and the

Speaker 16: When it nothing. People turnending a woman ded KA was to sound the susation regy the tani pada twenting a to the teachu.

Speaker 17: In 2022, we proactively implemented refined operational strategies and consistently enhanced operating efficiency through our development of core proprietary technologies and optimization of our organizational structure. Notably, while maintaining stable four-year revenue growth.

Speaker 18: We also achieved a significant increase in profitability. In the fourth quarter, our total average mobile MEUs amounted to 50.8 million.

Speaker 19: Average monthly paying users totaled $491,800 and revenue reached the new high of RMB 588 million.

Speaker 20: As a result of our operational efficiency optimization, both the amount of our operating expenses and their proportion of the total revenues decreased quarter over quarter and year over year. More excitingly, our net income surged 58% sequentially and more than 250% of our total revenue decreased by a quarter over quarter. This is a very important point to make.

Speaker 21: by our robust profit growth in 2022.

Speaker 22: with full year-night income reaching RMB 86.5 million, further demonstrating the sustainability of our business model and laying a solid foundation for our long-term growth.

Speaker 23: Sorry, only earlier.

Speaker 24: omando shei puhaar the Ty childrenlet toh Yong huat, the thinking littleed suhim.

Speaker 25: Thank you for your attention.

Speaker 26: CD chaara saa sequel

Speaker 27: W dot cracks my

Speaker 28: Thank you for watching We are.. Mental See you next time.

Speaker 29: And chan Kin sing the stud of goan eon poh oneing the verssing on par. Then found foundpt the studence sing a E vers ship.

Speaker 30: As ever, I will make a public message before anything else Hallo Fauzi Rem Tang Chinese Thank You For challenge What will Hong Kong government do for the environment Plan to shutter

Speaker 31: There are 16 countries that advocate on the gazing screen. However, how many like C T Y

Speaker 32: Thank you for your attention.

pl's the Chen this. She start a pking. You both holder can go abstore the inking in your plicants.

In terms of our audio entertainment business, we incubated and launched an array of audio entertainment products in 2022, covering users from broader verticals and bringing them a larger variety of interactive entertainment experiences. To that end, we integrated inventive social features.

interactivity and entertainment value. We also sponsored on top trending topics and cooperated with content creators to launch a variety of specialized audio programs throughout my year.

Leveraging various audio formats, including audio live streaming and forecasts, we provided users with unique and compelling interactive audio experiences.

Meanwhile, we held a series of IT-based annual competitions and various different online campaigns to further enhance our user interaction and community atmosphere. During this period, the Li Zhi app was spotlighted numerous times as a featured app in Apple's App Store.

definitly include quantum physics

Moment countryi lies into a job air, I being sams on the tissue, thin King the talia, he and K townangshow.

This annoyed her bet scarf. Our aftermath will be ending Bradebank and OJ.

Thank you Hello and welcome to KTSBull back again

Hey audience, sir.

to achieve the goal of certificates of medicine in discussions subject to prioralph Cache Ernest in Global Way

Dubrey digital Please subscribe Go together become yet another force to fight for the world Jay

nional domion ANI or a I isun an Yuan soli L PEA St sou.

nomenta ch a I Yao cai I Ts and chan Kin sing the Park.

tjon KE women who was here to PO an a I kpfather staffay more Yan morsoon.

Thank you for your attention.

economy and understand it. Thank you.

We look forward to thisT My

Green was on T T F suit and A. I issue the time years.

I think he had earlier ones unless being confined his and

Think we some to like she started the inink in coming young for many, some are ING E citizen FE good where, when youngong Bo is Don the chaning the children reading the K, the C, M.

In terms of business innovation, we have been researching and exploring both AI and related technologies for years and have made breakthroughs in automatic speech recognition, ASR, text to speech TTS, AI voice changer, and the AIJC among others.

laying the technical groundwork for commercial application of these technologies across our business.

We are pleased to share that thanks to our advanced technology for innovation capabilities, as well as our comprehensive business strength.

Li Zhi has been named among China's top 100 internet companies for the fourth consecutive year at the end of 2022.

At present, we have combined our existing AI technology capabilities with natural language processing, NLP, and other cutting-edge technologies to launch innovative entertainment features including AI chatbots. For example, we recently utilized the API of a large language model developed by the AI team to develop a new technology for AI.

chatbot demo integrating MLP technology with one-AI technology including ASR and TTS.

And just last week, we launched the Audio Chatbot, Jiaozhi, in our audio products, providing users with a novel, intelligent audio chat experience.

Thank you.

Hello, everyone, I am Dr Mir Baker, the chair would now brother tongue and gluteus tear think a different worked for not that and I'm the Ona Sy font might not a

Thank you for your attention.

We Thank You All For Reading Thank you. Thank you.

For example, the green changes will be blurred, or floundering in the Lok Liquid Supreme Court. For all the complete resources provided by the 96 blighted

Thank you for your attention.

Moving forward, we will continue to leverage pioneering technologies such as AIGC, NLP, and VoiceAI in the integration of our in-house self-developed technology and open-source tools, utilizing the rich resources and operating experience.

Li Zhi has accumulated in the online audio field. We will continuously fine-tune and optimize our AI models through supervised learning and reinforcement learning, enabling us to design interactive chatbots with more engaging and fun features.

We will also further expand their usage scenarios, providing users with a brand new social interactive experience.

Meanwhile, we will continue to upgrade our social products with more diverse features and functions, build a comprehensive interactive AI chatbot bubble, and promote the development of our global business.

Did you

Thank you for your attention.

We our student athletes, we will compete against the draught the when Carcass sending the

The Gu one a little assment women and J can be increasing. Can your PA on the townyear can be coun out the canmto heart on you ship.

punggol chanter tithe prata bunagio zong hii.

Can we please take care of this piece?

Committee measurement report AI Union SUNY formation ASK Editor Turing Hands Port There

AI, head LeDC-C, AI Foundation, Thank you for your attention.

momenttor is seen. The Ind are thinking he has sho go away. Who don'ped the survey ch out to the childle.

Overall, our achievements and the experience we accumulated in 2022 have laid a solid foundation for the continent's long-term sustainable development.

Stepping into 2023, we will unvarying execute our globalization strategy, establish an efficient global management system, empower business innovation through the development of frontier technologies, and promote the application of technologies such as the AIGC, VoiceAI, and the AI chatbots in our business.

and accelerate global business expansion. We are confident in the coming years' prospects and look forward to creating greater value for our shareholders and society at large.

Thanks.

Thank you for your attention.

Thank you all. With that, I will now turn the call over to our acting staff member, Ms. Chenfang Lu, who will discuss our financial results in more detail. Okay, thank you, Zilong, and hello everyone. We are delighted to report a set of studied financial results for the fourth quarter and full year 2022.

Thanks to our ongoing cost structure automations and operational efficiency enhancements, our net income in the fourth quarter surged 252% year-over-year and 58% sequentially to an all-time high of RMB 31.4 million. We are now settling for full year 2022. Our gross margin was 33%.

are 400 basis points year over year. And late income increased to RMB 86.5 million compared with the net loss of RMB 127.3 million in the previous year. We are encouraged by the robust growth in the profitability by our efficient operations and strong execution.

Entering 2023, we are committed to unleashing greater commercialization potential and delivering sustainable growth.

Now, I'd like to provide a brief overview of our financial results for the fourth quarter of 2022.

In the fourth quarter, our total net revenue through RMB500 is 87.6 million, representing an increase of 5% year-over-year, primarily due to growth in the average user spending on our audio entertainment products.

Cost of revenue was armed with 404.1 million in the fourth quarter of 2022, representing an increase of 7% year-over-year.

Primarily due to an increase in revenue sharing fees to accounting creators and the company's revenue group. I'm partially upset by decreases in salary and welfare benefits related to decrease in our operational outcome as well as the decline in other miscellaneous costs and share-based compensation expenses.

Gross profit was RMB 183.6 million in the fourth quarter of 2022, compared to RMB 181.9 million in the fourth quarter of 2021. Long-cap gross profit was RMB 185.1 million in the fourth quarter of 2022.

compared to RB184 formula in the fourth quarter of 2021.

Gross margin for the fourth quarter of 2022 was 31%, compared to 32% in the fourth quarter of 2021. Long gap gross margin for the fourth quarter of 2022 was 31%, compared to 33% in the fourth quarter of this year. Operating expenses were on the 158.7% level.

2021.

primary due to the decrease of expenses related to research and development services provided by third parties, and share-based compensation expenses, as well as decreased scenery and welfare benefits, related to a decrease in the number of our research and development staff.

Selling and marketing expenses were RMB67.7 million in the fourth quarter of 2022, compared to RMB17.9 million in the fourth quarter of 2021.

Primarily attributable to a decrease in branding and marketing expenses, as well as decreased salary and welfare benefits expenses relate to a decrease in the number of our marketing stocks.

The company will evaluate and adjust its marketing strategy and budget based on the company's performance, operational needs, and marketing conditions.

General and administrative expenses were only 26.7 million in the fourth quarter of 2022.

compared to RMB 32.2 million in the fourth quarter of 2021, mainly driven by decreases in professional service fees, share-based compensation expenses, and other miscellaneous expenses, partially offset by the increased salary and welfare benefits related to an increase in the average salary.

Operated income was RMB 25.5 million in the fourth quarter of 2022.

compared to RMB 5.4 million in the fourth quarter of 2021. Long-term operating income was RMB 31.1 million in the fourth quarter of 2022.

compared to RMB 14.7 million in the fourth quarter of last year. The net income was RMB 31.4 million in the fourth quarter of 2022 compared to RMB 8.9 million in the fourth quarter of 2021.

And long-cap net income was RMB's 37.1 million compared to RMB's 18.3 million in the fourth quarter of 2021.

Bison and diluted-laying Compra ADS were RMBs, 30 cents in the fourth quarter of 2022, compared to RMB 70 cents in the fourth quarter of 2021.

Long gap-based and diluting lane comfort ADF, where ARMV is 71 cents in the fourth quarter of 2022, compared to ARMV is 36 cents in the fourth quarter of 2021.

As of December 31, 2022, we had cash-on-cash equivalents, short-term investments, and restricted cash of RMB600 at $89.9 million.

Okay, this concludes all of our prepared remarks today. I will now open the call to questions. Operator, please go ahead.

Thank you. We will now begin the question-and-answer session.

To ask a question, please press star 1-1 on your telephone and wait for your name to be announced.

To withdraw your question, please press star 11 again. For the benefit of all participants on today's call, if you wish to ask your question to management in Chinese, please immediately repeat your question in English. For the sake of clarity and order, please ask one question at a time.

management will respond and then feel free to follow up with your next question. So once again that's Star 1-1 for questions.

Our first question comes from the line of Vicky Wei from CTE. Please ask your question Vicky.

umwhen is a launch she did do over the T lear where they have the ce ly just to one goes through earlier than people are using. Go home and send those ple in genders for some marth.

Thank you for taking my questions. My question is what is company strategy in the post pandemic era?

So you foundizing

L Pun Kiang

If we can wait for worldce Depression handy, to implement the ER clones command that walk through TWIN Stars of blocks Thank you very much

Thank you for your attention. Please enjoy the rest of your time. Please enjoy the rest of your time.

This question is answered by Marco, and I will translate for Marco. Thank you, Vicky. In terms of our overall strategic plans, we will further propel our global expansion strategy forward in 2023, promote the applications of AI chatbots in our global business, and promote the development of AI platforms in our global business.

and target more user groups through our diverse product matrix to ultimately achieve a steady growth of our global business.

Hi every community as long as you have here Thank you for your attention.

does this all work? or does Da Tight Stage please join in the precedence the weighing up by 6cover would be

So if, or tell if this coun you not be out to? uh they the boonha. When you quotaa is changrening the same answer, gevity. Yet the majesa is woman. J tissue, uh you, you to those something like: put om woman. You were have F that the time, coundown.

Japan yarn example Valentine's Day, is a to grew a Guthrie kiran icing Come O good obliteration design is

phone for the typing that you then

In the past few years, we've been four-in-a- developing fundamental core technologies pretending to voice AI and other effects.

And recently leveraging the cutting edge technologies, we have utilized the WAV AI and the HAN-LP among other technologies in our products. And for instance, we've launched the innovative functions in our products, including the TI board and the WAV chatbot, Xiao Zhi, or Mi Zhi ABB.

providing users with new online social interaction experiences.

And we are also leveraging the technology to empower our business development. And using AITC and with AI technology, we plan to launch customized social chatbot products that convey emotions and connect with users, as well as innovate more product features to enrich our product matrix.

Thank you very much.

If you have any questions, please feel free to contact us.

So AI, of course, is potentially a possibility in the United States of Asia at this time, and the United States is the world's number one we should not lose anything more than 10 trajectory of 230 win popul.

Thank you for your attention.

The PRI communication center find a top render because of these needed measurements to identify a target,

Where can go the? Put that? Hong see the? Send down the pay back the? T yet woman handmin in way across teaching host dire you put the? She showose to be all KE Ho was young, through your way able. Go to the? U that I can D F kent.

For the changes in user behaviors, in my opinion, the pandemic has made more people accustomed to online entertainment and communication. It also increased user experience for online companionship and emotional connection.

Additionally, we can see the technology is continuously developing. Recently, the GPT 4.0 model is published.

The new development of technology also brings more possibilities for product innovation. And the recent reaction of the whole market also shows that users are very receptive and enthusiastic about new things. Next, we will further develop our AI chatbots and upgrade product features for companionship.

fostering emotional connections to bring innovative online companionship experiences to more users. Our product positioning is in line with the needs of users in the post-pandemic era. In the iVideo, it will also bring greater growth potential for our business.

Do you woman the supervis D a who won' is a D having I understandian woman. He would tell Act about coing who your father having the you to chooating chchange how to you with your father.

If future formally alleged to deserve that

pati assume the Ind do main that whole you. They went on woman where who crittal three in the your partm motional I woman. That being So, the we will.

Our participants had a difficult experience in the ground.

and good luck in the upcoming events for all of us especially those who want to engage with us Please continue this practiceil and come back home.

In terms of investment, our business strategy in 2023 is to promote the global business expansion through our diverse product matrix with a focus on AI chatbot. We have been exploring and investing in AI chatbot technology for years.

and make investments every single year. In addition, we expect to increase the revenue scale by launching monetization models in this space. And we expect new revenue streams in 2023, but we expect the overall investment is under our management and control.

uhname 1: a woman. Yes SOI, I don't go a judgetown King. I I say is to keep on the cher Hi woman, the due to the England, to thisustfeel that I she something the jary tell the qu work part some time with just happ.

The there woman, I mean i- to cre C out. So what they to come fromian woman who con ward don't down H one Ho tetell you for uh switching. Don't put a to up like tell Y woman some T give a hawker company, uh don't. I am woman die, I sign and the whole you will more.

You stray a year would have done that, but you we see quoterthat and some in be Li? ately reach D earlier swepen.

In addition, we are improving our operational efficiency and reducing the cost of scale expansion through the enhancement of our versatile technology platforms and operational system infrastructure as well as the application of self-developed technologies. And we can see it from our performance in 2022.

On the marketing front, we aim to reduce the overall user acquisition costs by enhancing the network effects of our products and promoting the organic growth. In general, we expected the investment in 2023 to increase in line with our business growth.

but the overall proportion will remain at a reasonable level. Thank you. Next question, please.

proportion will remain at a reasonable level. Thank you. Next question, please. Thank you.

Our next question comes from the line of Serena Li from China Securities. Please ask your question Serena.

He you going to con just all that. He were what where? Because I wonn't young, youngang you a tric Ro home. She's a chat box, some sure, or about whatbab you think that, But when you going, he all the jacke. J really heard he about.

jition. I'm n Ching going suide power woman. Also chines has that uh calpoorlogy from I and countrye H the equal for jihua portfolio, or what do you find, isah?

Thanks for taking my question. And recently, we have seen that the company has some progress in the chatbot and AI area, like publishing for Zhi and Tiabot, et cetera. So could management share more specific plans and strategy regarding to the chatbot area? Thank you.

involved in the crisis strike.

Children say: on the side moment time I bning high a woman So hasatchto seing Union and teaches and the pool for one time. Some one you ful far and taing a combod teer Y who should? Who was cting on a E on teing each a, uh Te would re Te.

So machend that woman? That's R T they I UE to some TRI who, courseing the Te woman that you's produduicitating chchildrening gener is they comes to the saping, to pating now. Think you many that they have appeod? Yes, both Te.

We'll keep you updated about the for all future event.

Faculty Nowcheng han yue gaming toa. tense Blockchain wrogen young 90 at et time, William Game to Z and, you k a É t z recorded

Okay, this question is answered by Marco. In terms of the chatbot development, we actually started working on voice chatbot technology as early as 2018. And during the years, we have accumulated valuable experience in these technologies.

and have utilized this technical expertise in our products. And recently, we have made breakthroughs in waste AI technologies such as ASR and TTS. In addition, our years of experience in social audio and audio entertainment also give us a great advantage in training and launching innovative chatbots.

partnership experience and ultimately enhancing our differentiated competitive strengths.

of stretch in this slide which also deployed by othercosplay at best, it is easy toait see S For now I'm going to turn it aside to Tamao and then introduce themilla.

They are also working on potential solutions missions in???foundseisify. But we aren't sure about their provide me with a lot of assistance in highly Quite while I tables in ?? bureaucrats also needed a few funnel We saw how the methodology have done Queen was in a decent way

We will also launch chatbot functions and features in various products based on our product positioning and the unique demands from local users in various markets globally.

In the meantime, we plan to develop more innovative features to adapt to different user scenarios. For example, we may expand on the product functions by combining the advertised voice chat and functional bot, while also introducing corresponding monetization models.

In addition, we may launch a wider array of independent product lines focused on the AI chatbot, which would upgrade products and enrich our product matrix and bring in greater business growth potential.

Thank you. Next question, please. Thank you. Our next question comes from the line of Xinyuan from Huatai. Please ask your question Xinyuan.

is that we should have got that that one would add up to the support. Do you renew your opinion? You don't look or see him to go with you. We'll find that we see these amongst the upper chief, the solid growth in the past. If you could could imagine and share some color on measures we take.

And how should we think about the growth trend in the non-run? The second question is that is profitability continues to improve? And looking ahead, do we have any outlook for the profit margin? And how can we achieve that? Thanks a lot.

Okay Thank you for you. Have a good sham moment to you know, like you are thinking. You know you cnj one.

We can ask your name.

Jen, just a quick tell us your stabilizing Valkyrie error rate you know, I

uhfor that the profit county. So what young the also in the time your money CAn't like, keep some you for the time you do.

these circular things can bring up less noise, essentiallySearching of energy be Thebrain sequencer

In case you are in lack of support, you can sneak in the features from a different channel and let's see where the different Aliens are.

and the new technology. Thank you. The first question is about ARPU. So far our revenue is actually primarily generated from the auto entertainment business and we mainly focus on two aspects to improve the performance of ARPU.

For example, we launched customized virtual gifting options and avatars to expand the paying scenarios. We also lowered the threshold to participate in these activities so we can improve the user engagement and promote connections between users and content creators.

start enhancing users willingness to pay. So in terms of marketing strategies, through optimizing promotional models and promotional materials with intelligent advertising systems, we implemented precise user acquisition to reach the core user groups with stronger spending power and...

to the in soda layer the solution so you like I would like to show you the solution the solution

discontin IFTC dangerous projects ofcalled structures today in terms of the advertiser growth trend we hope to diversify our revenue streams through new business models such

revenue sources such as subscriptions and value-added services. Overall, we are confident that we can achieve more diversification of our revenue streams, as well as steady growth of our overall revenue scale in the future. And we do expect to see some changes in 2023.

The twice thousand three thousand hoop As happened, we are happy of being able to share, with you the possibility of a time cloud onalis, will bebased on the

rotations using the satellite?

to protect our Aquuccionannels andisher and takeawan and then go through using the

ch line part open the P ION, swoing your pool with the proit of part the caseason for you. So the da now adthere fail on the takego formian woman, where ifsuyou from go conducting? See about shouldup during the colar.

We are proud of your firstbreaker's great strength,

We achieved the overall profitability in 2022 and in the future we believe that our profitability and profit margin will further improve in the long term.

First of all, the master business still has a huge growth potential. With an increase in online audio user penetration rate, the market scale is also expanding further. We will continue to expand the core user groups in the audio entertainment sector to increase users' willingness to pay through a diverse range of operational activities.

and the innovative functions, promoting the growth of the user payment conversion rate and revenue. In terms of the cost structure, through refined user acquisition and operational strategies, along with the empowerment of our versatile technology platform, operational systems, and other services,

and our self-developed technologies, we will continue to improve our overall operating efficiency and achieving sustainable profitability.

Jieji Scalene in Hong Kong State University,

We hope to bring more new technologies to the global market. We hope to continue to improve the development of the global market and to improve the development of the global market. We hope to bring more new technologies to the global market.

and continue to improve our overall profitability.

Thank you. That's all. All right, thank you. There are no further questions now, so I'd like to turn the call back to the company for closing remarks. Well, thank you once again for joining us today.

If you have further questions, please feel free to contact Li Zhi's Investor Relations through the contact information provided on our website at ir.liizhi.fm or the Pionty Group Investor Relations. Thank you. 22

This concludes the conference call. You may now disconnect your line. Thank you.

The conference will begin shortly. To raise and lower your hand during Q&A, you can dial star 11.

F Alex

Hello ladies and gentlemen. Thank you for standing by for Leisure Inc.'s fourth quarter of fiscal year 2022 earnings conference call.

At this time, all participants are in the listen-only mode. After management's remarks, there will be a question and answer session. Today's conference call is being recorded.

I'd now like to turn the call over to your host, Effie Kong, Head of Capital Markets for the company. Please go ahead. Thank you very much. Hello everyone and welcome to the EJ INX fourth quarter and fiscal year 2022 earnings conference call. We released our financial and operating results via news wire services earlier today.

with the Q&A session. As a reminder, this conference is being recorded. In addition, an earnest highlights presentation and a webcast replay of this conference call will be available on the IR section of our website as IfM Avicii Institute of Medicine.

Before we continue, please note that today's discussions will contain forward-looking statements made under the DC Harbor prohibition of the U.S. Private Secretive Litigation Reform Act of 1995. These statements technically contain words such as, Please, we'll expect, target, estimate, and report back to you.

intent, belief, potential, continue, or other similar expressions. For overlooking statements involving timely risks and uncertainties, the accuracy of these statements may be impacted by a number of business risks and uncertainties that could cause actual results to differ materially from those projected or anticipated.

many of which factors are beyond our control. The company is a failure, advisors, representatives, and underwriters do not undertake any obligation to update this overlooking information, except as required under the applicable law. Please also note that the introduced press release and this conference call include discussions of unaudited...

Ciao!

Thank you for your attention.

general you can have addressing timeless

First I would like to say that, since I'm an assistant professor with a intellectual and current degree, growing up in picnic areas got me to be interested in all sorts of things. So my first phD, I'm actually an academic professor. Using these channels for engineering, purposely, we began getting to know

H Sri K Tan ony wah koh and huat comes in the Chicken ong gol keast Su the chank thingh houn a yearar with the batan.

jamil peinga chne KE iar you fund de gody Yong.

Thank you. We will now take questions from the audience. We will now take questions from the AI team. We will now take questions from the audience.

Sorry, Jieirtal, there is an indent in the US Minister ofrote drops and closes Harvard Ed Increase scientists report statement on Jennie Hon reiterate the completing of interest of one university fundraiser

take some time to pick up. And I British't

Thank you for your attention.

Wai wong de yung bui. breakout wall

Hello everyone, thank you for joining our fourth quarter and the full year 2022 earnings conference call. First of all, on behalf of the Li Zhiqing, I would like to express our deep gratitude to all our shareholders and investors for your continuous support. In the past year, despite the challenges posed by headwinds in the global macro environment, the fiscal crisis in the United States has become a harassment act against our entire economy.

we remain committed to steadily promoting our global business development and expanding our diversified product matrix at home and abroad. We also strive to harness the power of technology innovation and integrate the latest advancements of cutting edge technology into our business.

At present, we have applied voice AI technology in various existing products and launched an area of innovative AI features, including chatbots.

Going forward, we will continue to upgrade our technologies and product features and advance the application of AI chatbots in our products. We aim to provide users with innovative, online social competitive experiences by building our AI chatbot platform and creating more engaging, fun and interactive AI chatbot usage scenarios.

that foster emotional connection, ultimately promoting our global business development. Hello everyone, Today I will talk about the industry of horns Stack Something strange happened,

in decreased fashion and cultural abuse in kinderen theater? leads to devices who are immune to BR10

how modern?iminism define that rapportabletwo-something enormous 20802 and

Here think lokatu usuwe this isitjan E power. Please do the in of punaries to the singof data oti and pakari and dingi.

In char the seen yes stud, the woman DI sanda, the jes Su an which G T soloi H an quonti panti the chaindis Fi bengak P supaak to sany P the suan, sany five.

40,000 yuan per person, the whole area was divided into 2.5 times. In the total income of 22 years, the total is 28.1 yuan per person. The total income of the whole year is 100 points, it is 33%

Am I D the take on the. So when perent is' shaking, you can the hand in the they open up. So canyou these start. Other PA can look back with 1, one then it.

Next time the." of this discussion of self- Gamut richness of the vestibulance practice will begin. We are now return the FCSE conversations arranged for Q&A meeting. Thank you for your attention, have a good passover and did a good job. Thank you for containing time so that we can start from 0 to 2 minutes later and talk about

In 2022, we proactively implemented refined operational strategies and consistently enhanced operating efficiency through our development of core proprietary technologies and optimization of our organizational structure. Notably, while maintaining stable four-year revenue growth, we also achieved a significant increase in profitability.

In the fourth quarter, our total average mobile MAUs amounted to 50.8 million. Average monthly paying users totaled 491.8 thousand. And the revenue reached a new high of RMB 588 million.

As a result of our operational efficiency optimization, both the amount of operating expenses and their proportion of the total revenues decreased the total over quarter and year-over-year. More exciting, our net income surged 58% sequentially and more than 250% year-over-year to earn the 31.4 million.

In 2022, our full-year revenue increased to only $2.185 billion, while our full-year growth margin grew by 400 basis points to 33%. We are delighted by our robust profit growth in 2022.

with full year-night income reaching RMB 86.5 million, further demonstrating the sustainability of our business model and laying a solid foundation for our long-term growth. Hello everyone, I am Lu Xu, I am the CEO of Doyong Hwa, thinking a little from here.

Thank you for your attention.

As the weather exclaims.

wam houtagana and toyang hod' wheiller she had viso were mention rsu in the series in car. The chaning sing Ind ter of goveran.

Even PO runing the versing one PA, then I something the foodom sing: are you urgingwomen? E develops this without resurgent young. When young Son goes placeful, the PO young father stanking their young.

From a technical perspective, this number of

Business Partial American COSM is the promotes of companies.

In terms of our all-during education business, we incubated and launched an area of all-during education product in 2022.

current users from broader verticals and bring them a larger variety of interactive entertainment experiences. To that end, we integrated invented social features such as the avatar to enrich product function, the enhanced product interactivity and entertainment value. We also formed them on top trending topics and cooperated with content creators to launch a variety of specialized audio programs throughout the year.

Leveraging various audio formats, including audio live streaming and forecasts, we provided users with unique and compelling interactive audio experiences.

Meanwhile, we held a series of IT-based annual competitions and various different online campaigns to further enhance our user interaction and community atmosphere.

During this period, the Lich's app was spotlighted numerous times as a feature of the app in Apple's app store.

In fact re to the as a win her Ks to. They R the cent air D C the toger Pier Sugar eing the co code. Will you the signire parkkingin Yong? Ending appeunance to the tis Sue.

Woman C, then G the P come downin. Yet we can the issue something ly the accounting the she has H personly lead to the ear earn and their sh lear. And youionnot don't go hold anyone conher believeef can P Gu she the funddowninional woman can arunty or a I issue ear done an.

Yapo mokcak, where Yong PO E Kong Tai and P I K partk coon.

Next I would be the Messy. First, it represents the information bank's

Think we some, to like she started in be coming young for many times, are readving can citizen down good when, when the young Bo, she the chaning in the, the leving the can the C? M in terms of business innovation.

We have been researching and exploring voice AI and related technologies for years, and have made breakthroughs in automatic speech recognition, ASR, text-to-speech TTS, AI Voice Changer, and AIJC, among others, laying the technical groundwork for commercial application of these technologies across our business.

We are pleased to share that thanks to our advanced technological innovation capabilities, as well as our comprehensive business strength, Li Zhi has been named among China's top-country Internet companies for the fourth consecutive year at the end of 2022. At present, we have combined our existing AI technology capabilities with our existing AI technology capabilities.

with natural language processing, NLP, and other cutting-edge technologies to launch innovative entertainment features, including AI chatbots. For example, we recently utilized the API of a large language model developed by OpenAI to launch the TIbot module in our TI app, providing users with online AI conversational functions, in addition to the application of open source models.

In February , we developed an online audio chatbot demo integrating MLP technology with one AI technology including ASR and TQI.

And just last week, we launched the Audio Chatbot, Yangtze, in our audio products, providing users with a novel, intelligent audio chat experience.

We like women coming to the AIGC NLP to increase takeaway in tissue.

Y three and the issue a high the MO here from here TI pana in. We still the same ful timeer kingy end up.

one what can do here in a chaamas is's ising me the yoha where the moting Ko singinga Kong kok she singen chandthe Min the kian decen one think both, for am womanand a King ong Chang, when you would come Ching the childl o K when a ch? tise twent children to your father.

and open-source models. Utilizing the rich resources and operating experience Li Zhi has accumulated in the online audio field, we will continuously fine-tune and optimize our AI models through supervised learning and reinforcement learning, enabling us to design interactive chatbots with more engaging and fun features.

and promote the development of our global business.

To prove what he already told, demarcation is based on ordinance 34 to 80. A

our mission is involved in the review of AI blinded stock

and the development of the new technology. We will continue to work on the new technologies and the new technologies to ensure the development of the new technologies. Overall, our achievements and the experiences we accumulated in 2022 have laid a solid foundation for the continent's long-term sustainable development. Step into 2023, we will invariably execute our new technology.

confidence in the coming years prospects and look forward to creating greater value for our shareholders and society at large.

Now this is a job terminal. In moment the time therefore, you compfound will D out high the year.

Thank you all. With that, I will now turn the call over to our acting CFO , Ms. Chen Fanglu, who will discuss our financial results in more detail.

Okay, thank you, Zilong, and hello everyone. We are delighted to report a set of studied financial results for the fourth quarter and full year 2022. Thanks to our ongoing cost structure optimizations and operational efficiency enhancements, our net income in the fourth quarter surged 252% in the year 2020.

and late income increased to RMB 86.5 million, compared with the net loss of RMB 127.3 million in the previous year. While encouraged by the robust growth in the profitability driven by our efficient operations and strong execution, entering 2023, we are committed to un-

leaving greater commercialization potential and delivering sustainable growth. Now, I'd like to provide a brief overview of our financial results for the fourth quarter of 2022. In the fourth quarter, our total net revenue through RMB 587.6 million representing an increase of 5% year-over-year.

Primarily due to the growth in the average user spending, our auto entertainment products. Cost of revenue was armed with 404.1 million in the fourth quarter of 2022, representing an increase of 7% year-over-year.

Gross profit was RMB 183.6 million in the fourth quarter of 2022, compared to RMB 181.9 million in the fourth quarter of 2021. Long gap gross profit was RMB 185.1 million in the fourth quarter of 2022, compared to RMB 184.4 million in the fourth quarter of 2021. Gross margin for the fourth quarter of 2022 was 31.5 million in the fourth quarter of 2021.

compared to 32% in the fourth quarter of 2021. Long-gap growth margin for the fourth quarter of 2022 was 31%, compared to 33% in the fourth quarter of last year. Operating expenses were RMB 158.1 million in the fourth quarter of 2022, compared to RMB 176.6 million in the fourth quarter of 2021. Research and development expenses were RMB 63.7 million in the fourth quarter of 2021.

in the fourth quarter of 2022. Compared to RMB, 17.9 million in the fourth quarter of 2021.

Primarily attributable to a decrease in branding and marketing expenses, as well as decreased salary and welfare benefits expenses relate to a decrease in the number of our marketing staff. The company will evaluate and adjust its marketing strategy and budget based on the company's performance, operational needs and marketing conditions.

General and administrative expenses were RMB 26.7 million in the fourth quarter of 2022, compared to RMB 32.2 million in the fourth quarter of 2021, mainly driven by decreases in professional service fees, share-based compensation expenses, and other miscellaneous expenses.

Partially offset by the increased scenario and welfare benefits relate to an increase in the average scenario. Operated income was RMB 25.5 million in the fourth quarter of 2022, compared to RMB 5.4 million in the fourth quarter of 2021.

Long gap operating income was RMB 31.1 million in the 4th quarter of 2022, compared to RMB 14.7 million in the 4th quarter of last year.umps He According to the The And The InBa Yes. Aim Compared to RMB 37.1 The docker shutter one.

Basis undiluted laying compare ADF or RMBs 30 cents in the fourth quarter of 2022, compared to RMBs 70 cents in the fourth quarter of 2021. Long gap basis undiluted laying compare ADF were RMBs 71 cents in the fourth quarter of 2022 compared to RMBs 36 cents in the fourth quarter of 2021. As of December 31, 2022, the RMBs were

we had cash-by-cash equivalents, short-term investments and restricted cash of RMB600, 89.9 million.

Okay, this concludes all of our prepared remarks today. I will now open the call to questions. Operator, please go ahead. Thank you. We will now begin the question and answer session.

To ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. For the benefit of all participants on today's call, if you wish to ask your question to management in Chinese, please immediately repeat your question in English.

For the sake of clarity and order, please ask one question at a time. Management will respond and then feel free to follow up with your next question.

So once again, that's Star 1-1 for questions. Our first question comes from the line of Vicky Wei from CTE. Please ask your question Vicky.

What me I want, how she did just over that you loven whe you have this cel Y just say to: one goes side the understandian, because what you can go home and send that we a that ERS for some Mar.

Thank you for taking my question. My question is what is company strategy in the post pandemic era in 2020?

So you sound the?

So it's eaggo when he to to start F town. So you done a found down Sun and side. I mean I anian woman, J you with creating change, your father uh father and Tan uh pincare Chairman and creating real your K city and side change of higher Ro in an ingong.

We hope that the This question is answered by Marco and I will translate for Marco. Thank you, Vicky. In terms of our overall strategic plans, we will further propel our global expansion strategy for the Internet.

and the AI is a key tool for AI development. We have a lot of questions about

we focused on 5G detection and enabled our hand-causing 98le mobilizers and M? … Today we55e had over 70ours but and 5Gede and we have about 100 PiS

and the development of the AI technology is a very important tool in the development of the AI technology. We are committed to the development of the AI technology. In the past few years, we've been developing fundamental core AI technology and recently leveraging the AI technology.

We have utilized the OSI AI and the HANL-P among other technologies in our products. For instance, we've launched the innovative functions in our products, including the KiaBot and the OSI-CHAP-Bot-XiaoG or MiG-ABP, providing users with new online social interaction experiences.

while continuing to expand our commercialization models. We will continue to expand our commercialization models.

and today's topic is AI based guys, almost let's rest for 30 years we agreementometer AI world from 15 years ago weAB Let's discuss what AI presented and where AI s arranged and now

Hong Kong also is developed as a satellite or JFOD Bharat Research Institute, currently known as AIashop, core cybersecurity voice and andss Poc at Features palms and our security team, which are alreadyagh

and the user experience. For the challenges in user behaviors, in my opinion, the pandemic has made more people accustomed to online entertainment and communication. And it also increased the user demand for online companionship and emotional connection. We hope to see in the future viral manufacture of online entertainment with the

Additionally, we can see the technology is continuously developing. And recently, the GPT 4.0 model is published. The new development of technology also brings more possibilities for product innovation. And the recent reaction of the whole market also shows that users are very receptive and enthusiastic about new things. Next, we will further develop our AI chatbot and upgrade product features for compundentures.

fostering emotional connections to bring innovative online companionship experiences to more users. Our product positioning is in line with the needs of users in the post-pandemic era. I believe it will also bring greater growth potential for our business.

Thank you for the questions. Gab honored to have a kind since last year nine. Please remain safe during the program. We will continue the he was more frightened about the strong energy transfer. We

This is a question of a particularSn EE Star. AIX in science bestis a project on policymakers that does our best to poets we have nothing special analysis going on.

In terms of investment, our business strategy in 2023 is to promote global business expansion through our diverse product metrics with the focus on AI chatbot. We have been exploring and investing in AI chatbot technology for years and making investment everything go year. In addition, we expect to increase the revenue scale by

And the last horoscope We can see the valleys of the bridge. And the wall are phones news. So this will be the lead s table

People in large families will associate awareness with the effects of products due to investments that exist.

We need to steps of a Decadence and a Red analog-oved 978

but the overall proportion will remain at a reasonable level. Thank you. Next question, please. Thank you. Our next question comes from the line of Serena Li from China Securities. Please ask your question, Serena. Please ask your question, Serena.

uh what where? Because I want't young changang. When you a tradition Ro suiting she the chck box, show ES out what you able to think up about when you going to hit out the jac, So Ty about jition, I'm nunchshe going to that powerment. Also, chines has done that cheblogy from me and country Hi I J hua portfolio, or what the findis.

base... So I'll hand it to Wuxi to finish the offer. And then I'd like to introduce put to the stage,rac Canadian

and the data is not the same as the AI data is not the same as the data that is the same as the NLP data is not the same

in the manner set into thevantage hypothesis, Hit and Matt wanted, man and issue.metal

we hope to see more of this in the future. We hope to see more of these in the future. We hope to see more of these in the future.

Recently, we have made breakthroughs in voice AI technologies such as ASR and TTS. In addition, our years of experience in social audio and audio entertainment also give us a great advantage in training and launching innovative chatbots that can convey emotions. So we will further leverage our years of experience and technological strength to promote the application of chatbots.

Timing entry content: chep outical women. Once it's open though, it hking to people ER own time.

I hope you came to my note for the same questions as last time in previous lectures than in the previous work. and an important possibility for starting a innovate in the future.

We will now begin the AI chat box. We will now begin the Q&A session. If you have any questions, please feel free to contact us. We will now begin the Q&A session.

Moving forward, we will also launch chatbot functions and features in various products based on our product positioning and the unique demand from local users in various markets globally.

In the meantime, we plan to develop more innovative features to adapt to different using scenarios. For example, we may expand on the product functions by combining the advertised voice chat and functional bot, while also introducing corresponding monetization models.

Thank you. Our next question comes from the line of Xin Yuan from Huatai. Please ask your question Xin Yuan.

The P year are doing New York in a in down lo course we canendever MO out.

We see this is the most upward to the solid growth in the past few quarters. Could the management share some color on measures we take and how should we think about the growth trend in the long run? The second question is...

that this profitability continues to improve. And looking at it, do we have any outlook for the profit margin, and how can we achieve that? Thanks a lot.

Okay Thank you for you have put a good year of moment. We are also i. you are thinking. You know you C n J one be come out to the collet. We after have performmian.

That you inter family moment. We are transing, having high high there for your part of protonite town. You go to for you. So you go. The proffe are co pure mom which you are cur, cussing, how I say a high swing, the transing Chang down, Bon a for that. A fuloffeed couny two down. Be P the timeman. I see some your going.

taating using the hoer who was seeing proving a mee. Is the the food? Us judge hmany here coing the youn changey night. Swing the food the joba to out with ambia. The first question about the apfood.

So far our revenue is actually primarily generated from the order entertainment business. And we mainly focus on two aspects to improve the output. In terms of operational strategies, we continue to refine our innovative product functions and features. And we also diversify our operating activities.

We enhanced our user engagement and promoted the user payment conversion rate. For example, we launched a customized virtual gifting option and avatar to expand the paying scenario. We also lowered the threshold to participate in these activities so we can improve the user engagement and promote connections between users and content creators. That's enhancing users' willingness to pay.

So in terms of marketing strategies to optimizing promotional models and promotional materials with an intelligent advertising system, we implemented precise user acquisition to reach the core user groups with stronger spending power and the willingness to pay and to promote the payment commercial rate. All cleared.

hunk here some tre, ES. Woman, ES you go your instit the human mos, S. Like SY have putting you ter you would you had a day being sothe life young woman the show. Take the to PA.

such as subscriptions and value-added services. Overall, we are confident that we can achieve more diversification of our revenue streams, as well as steady growth of our overall revenue scale in the future. And we do expect to see some changes in 2023.

So with that, we now have questions from everyone. On the more recent news, the Wuhan government recommended that sheep

He explained earlier that in one year there It is only a choice if he leaves if he gets a win. Thank you very much.

The Chinese government is a very important company. We are very proud to be part of this project. We are very proud to be part of this

We achieved the overall profitability in 2022 and in the future we believe that our profitability and profit margin will further improve in the long term.

First of all, the master business still has a huge growth potential. With an increase in online audio user penetration rate, the market scale is also expanding further. We will continue to expand the core user groups in the audio entertainment sector and increase users' willingness to pay through a diverse range of operational activities and innovative functions.

promoting the growth of the user payment conversion rate and revenue. In terms of the cost structure, through refined user acquisition and operational strategies, along with the empowerment of our versatile technology platform, operational systems and other software enterprises are also available for free.

and our self-developed technologies, we will continue to improve our overall operating efficiency and achieving sustainable profitability. Thank you, Mr. Chen. I would like to thank you for your time. I hope you will continue to work on AI-tripping and to be able to contribute to the future. I hope you will continue to work on AI-tripping.

Or over. Went here on though, is lect go the show. Er conian time, war money. A continuue F on the put the one say we take this something there don't had a thousand time moment in in those T? sh is momentum, is Union andly.

As for the global business, we hope to bring more revenue contributions by reaching our product matrix and also diversifying our business models along with the application of AI chat watch.

We will also make dynamic adjustments in resource allocation based on different stages of business development. In the long term, we are confident in continuously improving our overall profitability.

Thank you. That's all. All right, thank you. There are no further questions now, so I'd like to turn the call back to the company for closing remarks.

Well, thank you once again for joining us today. If you have further questions, please feel free to contact me, Jie, the investor relations through the contact information provided on our website at ir.ly.fm or the P&T Group investor relations. Thank you. This concludes the conference call.

You may now disconnect your line. Thank you.

Q4 2022 Lizhi Inc Earnings Call

Request a DemoDemo

SOGP

Sound Group

Earnings