Full Year 2023 Xiao-I Corp Earnings Call

April 30, 2024

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Operator: Good day, ladies and gentlemen. Thank you for standing by, and we warmly welcome you all to the Xiao-I First Full Year 2023 Earnings Conference Call. Currently, all participants are in listen-only mode. Later, we will conduct a question and answer session, and instructions will follow at that time. As a reminder, we are recording today's call. If you have any objections, you may disconnect at this time. Now I will turn the call over to Beri Shah, IR Director of Xiao-I. Beri, please proceed.

Speaker Change: Good day, ladies and gentlemen, thank you for standing by him. We warmly welcome you all to the shall I first full year 2023 earnings conference call.

Currently all participants are in listen only mode.

Speaker Change: Later, we will conduct a question and answer session and instructions will follow at that time.

Speaker Change: As a reminder, we are recording today's call. If you have any objections you may disconnect at this time.

Operator: Now I will turn the call over to Barry Sha, IR Director of Xiao-I. Barry, please proceed.

Speaker Change: Now I will turn the call over to Barry shot IR director shall I Barry. Please proceed.

Barry Sha: Thank you, operator, and greetings to all participants. Welcome to Xiao-I's 2023 Earnings Conference Call. Present with us today are Mr. Hui Yuan, Chief Executive Officer, and Mrs. Kelly Weng, Chief Financial Officer. We announced our 2023 unaudited financial results earlier today. The press release is available on the company's IR website, as well as from newswire services. A replay of this call will also be available in a few hours on our IR website. During this call, we will discuss our business outlook and make forward-looking statements. Please note that these comments are made under the Safe Harbor provisions of the US Private Securities Litigation Reform Act of 1995. The forward-looking statements are based on our predictions and expectations as of today.

Beri Shah: Thank you, Operator, and greetings to all participants. Welcome to CEL-I's 2023 Earnings Conference Call. Present with us today are Mr. Max Yuan, Chief Executive Officer, and Mrs. Callie Wong, Chief Financial Officer.

Barry: Thank you operator, and greetings to all participants welcome to Sal I Skus doesn't twenty-three earnings conference call.

Barry: Present with US today are Mr. Maxwell Chief Executive Officer, and Mr. Scallywag Chief Financial Officer.

Beri Shah: We announced our 2023 unaudited financial results earlier today. The press release is available on the company's IR website, as well as from Newswire Services. A replay of this call will also be available in a few hours on our IR website.

Barry: We announced our 2023 on audited financial results earlier today.

Barry: This release is available on the company's IR web site.

Barry: As well as from Newswire services.

A replay of this call will also be available in a few hours on our IR website.

Beri Shah: During this call, we will discuss our business outlook and make forward-looking statements. Please note that these comments are made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Also, forward-looking statements are based on our predictions and expectations as of today. Actual events or results could differ materially due to some risks and uncertainty, including those mentioned in our filings with the SEC. The company does not assume any obligation to update any forward-looking statement except as required under applicable law. Also, please note that unless otherwise stated, all figures mentioned during the conference call are in U.S. dollars. With that, I now turn the call over to your CEO, Max Yuan. Please go ahead, Max.

Barry: During this call, we will discuss our business outlook and make forward looking statements.

Barry: Note that these comments are made under the safe Harbor provisions of the U S. Private Securities Litigation Reform Act of 90 95.

Barry: Also the forward looking statements are based on our predictions and expectations as of today.

Barry Sha: Actual events or results could differ materially due to some risks and uncertainties, including those mentioned in our filings with the SEC. The company does not assume any obligation to update any forward-looking statements except as required under applicable law. Also, please note that unless otherwise stated, all figures mentioned during the conference call are in US dollars. With that, let me now turn the call over to our CEO, Hui Yuan. Please go ahead, Hui.

Barry: Actual events or results could differ materially due to some risks and uncertainties, including those mentioned in our filings with the SEC.

Barry: The company does not assume any obligation to update any forward looking statements, except as required under applicable law.

Barry: Also please note that unless otherwise stated all figures mentioned during the conference call are in U S dollars.

Barry: With that let me now turn the call over to our CEO Mark Jones. Please go ahead mats.

Hui Yuan: Thanks, Barry. Good day, everyone, and thank you for joining us today. The year 2023 marked a turning point for the generative AI sector. With tremendous growth on the horizon, I think it is undeniable that this technology has the potential to revolutionize the entire technology sector and become an integrated part of nearly every business sphere. As a game changer, AI holds immense value up for grabs. In terms of financial performance, 2023 was a year of stable growth for our company. Our total revenue reached an impressive $59.2 million, reflecting a remarkable year-on-year increase of 22.8%. This growth was primarily driven by our strategic focus on AI model services, particularly our Hua Zang LLM, which spearheaded the growth of our MaaS business by 48.5%, reaching $19.2 million.

Max Yuan: Thanks, Barry. Good day, everyone, and thank you for joining us today. The year 2023 marked a turning point for the generative AI sector. With tremendous growth on the horizon, I think it is undeniable that this technology has the potential to revolutionize the entire technology sector and become an integrated part of nearly every business sphere. As a game changer, AI holds immense value up for grabs. In terms of financial performance, 2023 was a year of stable growth for our company. Our total revenue reached an impressive $59.2 million, reflecting a remarkable year-on-year increase of 22.8%. This growth was primarily driven by our strategic focus on AI model services, particularly our Hua Zang LLM, which spearheaded the growth of our MaaS business by 48.5%, reaching $19.2 million.

Max Yuan: Very good day, everyone, and thank you for joining us today. The year 2023 marked a turning point for the generative AI sector, with tremendous growth on the horizon. I think it has undeniable merit. Technology has the potential to revolutionize the Intel technology sector and become an integral part of nearly every business sphere. As a game-changer, AI holds immense value up for grabs in terms of financial performance. 2023 was a year of stable growth for our company. Our total revenue reached an impressive 59.2 million, reflecting a remarkable year-on-year increase of 20%.

Mark Jones: Thanks Barry.

Mark Jones: Good day, everyone and thank you for joining us today.

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Max Yuan: 2.8 percent. This growth was primarily driven by our strategic focus on AI model services, particularly Huazhang, LLM. She spearheaded the growth of our mass business by 48.5%, reaching 19.2 million. Simultaneously, our non-mask business also experienced healthy growth, with revenues increasing by 13.4% to reach $40 million.

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Hui Yuan: Simultaneously, our non-MaaS business also experienced a healthy growth, with revenues increasing by 13.4% to reach $40 million. I'm delighted to announce that 2023 has been a pivotal year for us, marked by groundbreaking initiatives. If you were present at our 2023 interim results call, you may recall the exciting news I shared that in July 2023, we launched our own ChatGPT, Hua Zang Universal Large Language Model. In simple terms, it encompasses a wide range of capabilities and addresses the key challenges faced by global AI models. It is designed to be controllable, customizable, and deliverable. Another highly promising initiative I want to highlight is our Hua Zang ecosystem, which was built upon the strong foundation of our Hua Zang LLM and was introduced in October 2023.

Max Yuan: Simultaneously, our non-MaaS business also experienced a healthy growth, with revenues increasing by 13.4% to reach $40 million. I'm delighted to announce that 2023 has been a pivotal year for us, marked by groundbreaking initiatives. If you were present at our 2023 interim results call, you may recall the exciting news I shared that in July 2023, we launched our own ChatGPT, Hua Zang Universal Large Language Model. In simple terms, it encompasses a wide range of capabilities and addresses the key challenges faced by global AI models. It is designed to be controllable, customizable, and deliverable. Another highly promising initiative I want to highlight is our Hua Zang ecosystem, which was built upon the strong foundation of our Hua Zang LLM and was introduced in October 2023.

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Max Yuan: I'm delighted to announce that 2023 has been a pivotal year for us, marked by groundbreaking initiatives. If you were present at our 2023 Interim Results Call, you may recall the exciting news at SharedNet in July 2023. We launched our own JGPT, the Huazhang Universal Large Language Model.

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Max Yuan: In simple terms, it encompasses a wide range of capabilities and addresses the key challenges faced by global AI models. It is designed to be controllable, customizable, and scalable. Another highly promising initiative I want to highlight is our Huazhang ecosystem, which was built upon the strong foundation of our Huazhang LAM and was introduced in October 2023. This ecosystem represents a revolutionary development with significant implications for the industry. Also, it not only streamlined our processes but also empowered us to provide tailor-made solutions to our customers, enabling them to create unique and branded conversational AI experiences.

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Hui Yuan: This ecosystem represents a revolutionary development with significant implications for the industry. How so? It not only streamlined our processes, but also empowered us to provide tailor-made solutions to our customers, enabling them to create unique and branded conversational AI experience. In just a few months since its launch, we have successfully implemented the Hua Zang ecosystem, facilitating the commercialization efforts of our partners in various industries. The system is now collaborating with thousands of ecosystem partners across more than 50 industry spheres, including finance, healthcare, automobile, and manufacturing. This success validates the commercialization path of the Hua Zang ecosystem. With such robust support, I eagerly anticipate unlocking significant commercial potential and generating substantial returns for the company in the near future.

Max Yuan: This ecosystem represents a revolutionary development with significant implications for the industry. How so? It not only streamlined our processes, but also empowered us to provide tailor-made solutions to our customers, enabling them to create unique and branded conversational AI experience. In just a few months since its launch, we have successfully implemented the Hua Zang ecosystem, facilitating the commercialization efforts of our partners in various industries. The system is now collaborating with thousands of ecosystem partners across more than 50 industry spheres, including finance, healthcare, automobile, and manufacturing. This success validates the commercialization path of the Hua Zang ecosystem. With such robust support, I eagerly anticipate unlocking significant commercial potential and generating substantial returns for the company in the near future.

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Max Yuan: In just a few months since its launch, we have successfully implemented the Huazhang ecosystem, facilitating the commercialization efforts of our partners in various industries. The system is now collaborating with thousands of ecosystem partners across more than 50 industry fields, including finance, healthcare, automobile, and manufacturing. This success validates the commercialization path of the Huazhang ecosystem with such robust support.

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Max Yuan: I eagerly anticipate unlocking significant commercial potential and generating substantial returns for the company in the near future. Next, I want to emphasize the critical importance of strong research and development capability for our ongoing success and our ability to create innovative solutions in the rapidly evolving field of AI technology. We are dedicated to meeting the needs of our customers by listening to their feedback and requests and responding with new solutions and enhanced features without much delay. March 31, 2024.

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Hui Yuan: I want to emphasize the critical importance of a strong research and development capability for our ongoing success and our ability to create innovative solutions in the rapidly evolving field of AI technology. We are dedicated to meeting the needs of our customers by listening to their feedback and requests, and responding with new solutions and enhanced features. As of 31 March 2024, our research and development team consists of 158 talented individuals, making up 56.2% of our overall workforce. Among them, we have 104 bachelor's degree holders, 17 master's degree holders, and 7 individuals with doctorates. Many of our senior engineers have accumulated more than a decade of experience in the computer, internet, and AI industries.

Max Yuan: I want to emphasize the critical importance of a strong research and development capability for our ongoing success and our ability to create innovative solutions in the rapidly evolving field of AI technology. We are dedicated to meeting the needs of our customers by listening to their feedback and requests, and responding with new solutions and enhanced features. As of 31 March 2024, our research and development team consists of 158 talented individuals, making up 56.2% of our overall workforce. Among them, we have 104 bachelor's degree holders, 17 master's degree holders, and 7 individuals with doctorates. Many of our senior engineers have accumulated more than a decade of experience in the computer, internet, and AI industries.

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Max Yuan: Our research and development team consists of 158 talented individuals making up 56.2 percent of our overall workforce. Among them, we have 104 bachelor's degree holders, 17 master's degree holders, and 7 individuals with doctorates.

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Max Yuan: Many of our senior engineers have accumulated more than a decade of experience in the computer, internet, and AI industries. Additionally, we collaborate with a number of AI experts from renowned universities and research institutes. I'm pleased to share with you that as of December 31, 2023, we had a total of 258 patient applications, including pending expelled and transferred cases, excluding granted patents.

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Hui Yuan: Additionally, we collaborate with a number of AI experts from renowned universities and research institutes. I'm pleased to share with you that as of 31 December 2023, we had a total of 258 patent applications, including pending, examined, and transferred cases, excluding granted patents. We also obtained 318 patent grants and registered 137 software copyrights. In 2023 alone, we filed 36 new patent applications, received 39 patent grants, registered 7 software copyrights. Among these, there were 6 patent applications specifically related to large models, all filed in 2023, and 3 registered software copyrights in the same category. Additionally, there were 2 patent applications related to OOTDiffusion, our upcoming new network architecture for realistic and controllable virtual try-on.

Max Yuan: Additionally, we collaborate with a number of AI experts from renowned universities and research institutes. I'm pleased to share with you that as of 31 December 2023, we had a total of 258 patent applications, including pending, examined, and transferred cases, excluding granted patents. We also obtained 318 patent grants and registered 137 software copyrights. In 2023 alone, we filed 36 new patent applications, received 39 patent grants, registered 7 software copyrights. Among these, there were 6 patent applications specifically related to large models, all filed in 2023, and 3 registered software copyrights in the same category. Additionally, there were 2 patent applications related to OOTDiffusion, our upcoming new network architecture for realistic and controllable virtual try-on.

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Max Yuan: We also abetting abetting the 318 patent grants and registered 137 software copyrights. In 2023 alone, we filed 36 new patent applications, received 39 patent grants, and I registered 7 software on copyright.

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Max Yuan: Among these, there were six patent applications specifically related to large models, all founded in 2003, and the three registered software copyright in the same category. Additionally, there were two patent applications related to OOTD Fusion, our upcoming new network architecture for realistic and controllable virtual trials, popularity of OOTD on Github, and the discussions on PlatformX, indicating significant attention from potential consumers and promising prospects for product commercialization, to further strengthen our capabilities. We have established joint laboratories with institutions such as the Institute of Software of the Chinese Academy of Science, China Normal University, and Hong Kong University of Science and Technology.

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Hui Yuan: It is worth noting the high popularity of OOTD on GitHub and the discussions on X, indicating significant attention from potential consumers and promising prospects for product commercialization. To further strengthen our capabilities, we have established joint laboratories with esteemed institutions such as the Institute of Software, Chinese Academy of Sciences, East China Normal University, and Hong Kong University of Science and Technology. Furthermore, we have fostered close partnerships with Tsinghua University, Fudan University, Shanghai Jiao Tong University, Beijing University of Posts and Telecommunications, and Peking University. Together, through our unwavering commitment to research and development, we are poised to conquer new horizons and shape the future of AI technology. Moving on to another key strategic focus, globalization.

Max Yuan: It is worth noting the high popularity of OOTD on GitHub and the discussions on X, indicating significant attention from potential consumers and promising prospects for product commercialization. To further strengthen our capabilities, we have established joint laboratories with esteemed institutions such as the Institute of Software, Chinese Academy of Sciences, East China Normal University, and Hong Kong University of Science and Technology. Furthermore, we have fostered close partnerships with Tsinghua University, Fudan University, Shanghai Jiao Tong University, Beijing University of Posts and Telecommunications, and Peking University. Together, through our unwavering commitment to research and development, we are poised to conquer new horizons and shape the future of AI technology. Moving on to another key strategic focus, globalization.

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Max Yuan: Furthermore, we have fostered close partnerships with Tsinghua University, Fudan University, Shanghai Jiao Tong University, Beijing University, and Post and Telecommunications at Peking University. Together, through our unwavering commitment to research and development, we are poised to conquer new horizons and shape the future of AI technology. Moving on to another key strategic focus, globalization, our efforts towards global expansion gained momentum with the establishment of two overseas subsidiaries in the U.S. and the United Arab Emirates, Emery. These strategic initiatives are integral to our vision of becoming a global leader in AI technology, enabling us to better serve our customers and sales opportunities in new markets.

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Hui Yuan: Our efforts towards global expansion gained momentum with the establishment of two overseas subsidiaries in the US and the United Arab Emirates. These strategic initiatives are integral to our vision of becoming a global leader in AI technology, enabling us to better serve our customers and seize opportunities in new markets. In conclusion, 2023 was a year of unprecedented growth, innovation, and strategic expansion for Xiao-I. As we embark on the journey ahead, fueled by the successes of the past year, we are confident that we are well-positioned to continue our trajectory of growth and leadership in the AI industry. Looking ahead into 2024, we expect that the Hua Zang LLM is set to further strengthen its commercialization efforts.

Max Yuan: Our efforts towards global expansion gained momentum with the establishment of two overseas subsidiaries in the US and the United Arab Emirates. These strategic initiatives are integral to our vision of becoming a global leader in AI technology, enabling us to better serve our customers and seize opportunities in new markets. In conclusion, 2023 was a year of unprecedented growth, innovation, and strategic expansion for Xiao-I. As we embark on the journey ahead, fueled by the successes of the past year, we are confident that we are well-positioned to continue our trajectory of growth and leadership in the AI industry. Looking ahead into 2024, we expect that the Hua Zang LLM is set to further strengthen its commercialization efforts.

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Max Yuan: In conclusion, 2023 was a year of unprecedented growth, innovation, and strategic expansion for Xiao-I. As we embark on the journey ahead, fueled by the successes of the past year, we are confident that we are well-positioned to continue our trajectory of growth and, Looking ahead into 2024, we expect that the Huaqiang LAM is set to further strengthen its commercialization efforts. Delving deeper into understanding and meeting customer needs, we expect our B2B operations to continue to exhibit a robust and consistent growth trajectory with around 20% of growth rate on a yearly basis.

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Speaker Change: We are confident that we are well positioned to continue our trajectory of growth and leadership in the industry.

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Hui Yuan: Delving deeper into understanding and meeting customer needs, we expect our B2B operations to continue to exhibit a robust and consistent growth trajectory with around 20% growth rate on a yearly basis. At the same time, the advent of LLM has significantly expanded the potential for AI in consumer applications. We believe the integration of AI models and consumer applications has become more seamless and impactful, driving innovation and meeting consumer demand more effectively. Hence, we further expand our business into the B2C market. On the front of R&D, we will continue to make endeavors and investments to strengthen our product capabilities. Collaborative efforts with our partners and customers to integrate our large language model will be a central part of our approach. As you may have noticed, we have recently announced a very exciting progress regarding several new products, including OOTDiffusion.

Max Yuan: Delving deeper into understanding and meeting customer needs, we expect our B2B operations to continue to exhibit a robust and consistent growth trajectory with around 20% growth rate on a yearly basis. At the same time, the advent of LLM has significantly expanded the potential for AI in consumer applications. We believe the integration of AI models and consumer applications has become more seamless and impactful, driving innovation and meeting consumer demand more effectively. Hence, we further expand our business into the B2C market. On the front of R&D, we will continue to make endeavors and investments to strengthen our product capabilities. Collaborative efforts with our partners and customers to integrate our large language model will be a central part of our approach. As you may have noticed, we have recently announced a very exciting progress regarding several new products, including OOTDiffusion.

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Max Yuan: At the same time, the event of LLM has significantly expanded the potential for AI in consumer applications. We believe the integration of AI models and consumer applications has become more seamless and impactful, driving innovation and meeting consumer demand more effectively. Hence, we further expand our business into the B2C market. On the front of R&D, we will continue to make endeavors and investments to strengthen our product capabilities. Collaborative efforts with our partners and customers to integrate our large language model will be a central part of our approach. As you may have noticed, we have recently announced very exciting progress regarding several new products, including OOT diffusion. As I mentioned earlier, it's a new network architecture for realistic and controllable virtual trials.

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Hui Yuan: As I mentioned earlier, it's a new network architecture for realistic and controllable virtual try-on. DIF, Daily Invest Focus, a platform that utilizes advanced AI technology to provide capital market analysis and insights on par with professional investors, supporting investment decision-making. Our commitment to pushing boundaries and revolutionizing industries will propel us towards a future where AI has a profound impact on people's lives. Together with our partners and customers, we will continue to embrace new challenges and seize opportunities to shape the world through cutting-edge AI solutions. Now, let me turn the call over to our CFO, Kelly, to go over our financials.

Max Yuan: As I mentioned earlier, it's a new network architecture for realistic and controllable virtual try-on. DIF, Daily Invest Focus, a platform that utilizes advanced AI technology to provide capital market analysis and insights on par with professional investors, supporting investment decision-making. Our commitment to pushing boundaries and revolutionizing industries will propel us towards a future where AI has a profound impact on people's lives. Together with our partners and customers, we will continue to embrace new challenges and seize opportunities to shape the world through cutting-edge AI solutions. Now, let me turn the call over to our CFO, Kelly, to go over our financials.

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Max Yuan: And this daily investor-focused platform that utilizes advanced AI technology to provide capital market analysis and insights on par with professional investors, supporting investment decision-making. Our commitment to pushing boundaries and revolutionizing industries will propel us towards a future where AI has a profound impact on people's lives. Together with our partners and customers, we will continue to embrace new challenges and seize opportunities to shape the world through cutting-edge AI solutions. Now, let me turn the call over to our CFO, Kelly, to go over our financials.

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Speaker Change: Now, let me turn the call over to our CFO Kelly to go over our financials.

Kelly Weng: Thank you, Max, and welcome to everyone on the call. Before I go into numbers, please know that all numbers presented are in US dollars, and all comparisons are on a year-over-year basis unless otherwise stated. For a more comprehensive breakdown, please refer to our earnings press release. Driven by strong digital transformation needs in enterprises, we've hit a record top line for the year. We are talking about a 22.8% growth from the previous year. Not just that, the robust performance also translated into a 270 basis point expansion, bringing our gross margin to an expanded 66.6%. Here's the cherry on top. As pioneers at the frontier of cognitive AI, we've unveiled our large language model.

Callie Wong: Thank you, Max, and welcome to everyone on the call. Before I go into numbers, please know that all numbers presented are in U.S. dollars, and all comparisons are on a year-over-year basis unless otherwise stated. For a more comprehensive breakdown, please refer to our earnings press release. Driven by strong digital transformation needs in enterprises, we've hit a record top line for the year. We are taking about a 22.8% growth from the previous year. Not just that, but the robust performance also translated into a 270 base point expansion, bringing our gross margin to an expansive 66.6%. And here's the cherry on top.

Kelly: Thank you Max and welcome to everyone on the call.

Kelly: If I go into numbers. Please note that all numbers presented.

And Oh compressions.

Kelly: A year over year basis, unless otherwise stated for a more comprehensive breakdown. Please refer to our earnings press release.

Kelly: Driven by strong digital transformation needs.

Kelly: Breakfast with via Telecom top line for the year, we are taking about at 22, 8%.

Kelly: From the previous year.

Kelly: Just back to robust performance also translated into a 270 basis point expansion, bringing our gross margin to an expensive 66 six percentage.

Speaker Change: Yes, the turnaround tops as.

Callie Wong: As pioneers at the frontier of cognitive AI, we've unveiled our large language model. This innovative move has prepared our R&D investments to, and percentage heat, underscoring our unwavering dedication to harness and spearhead the transformative power of core AI technology. With that, we expect to capitalize on vast... Opportunities in the AI Realm. Breaking it down further, the increase in net revenue was primarily due to the increased sales of cloud platform products.

Speaker Change: As pioneers added frontier of coordinating with and without a.

Operator: This innovative move has propelled our R&D investments to unprecedented heights, underscoring our unvarying dedication to harness and spearhead the transformative power of core AI technology. With that, we expect to capitalize on vast opportunities in the AI realm. Breaking it down further, the increase in the net revenue was primarily due to the increased sales of cloud platform products. These numbers help offset the declines in other areas, led by our continued shift towards subscription-based cloud platform products from one-time software purchases. Keep in mind that some of our revenue channels, like tech development services and software purchases, typically shine in Q4 of the year. I'd also like to bring to your attention that the rise in the cloud platform products is actually driven by the development of our MaaS business. By nature, our MaaS business is mostly delivered through cloud platform products.

Kelly Weng: This innovative move has propelled our R&D investments to unprecedented heights, underscoring our unvarying dedication to harness and spearhead the transformative power of core AI technology. With that, we expect to capitalize on vast opportunities in the AI realm. Breaking it down further, the increase in the net revenue was primarily due to the increased sales of cloud platform products. These numbers help offset the declines in other areas, led by our continued shift towards subscription-based cloud platform products from one-time software purchases. Keep in mind that some of our revenue channels, like tech development services and software purchases, typically shine in Q4 of the year. I'd also like to bring to your attention that the rise in the cloud platform products is actually driven by the development of our MaaS business. By nature, our MaaS business is mostly delivered through cloud platform products.

Speaker Change: Large language model.

Speaker Change: This innovation mode.

Speaker Change: Pink R&D investments too.

Speaker Change: And presented here.

Speaker Change: Underscoring our ongoing dedication to harness and per head the transformational power of core AI technologies, we that we expect to capitalize on fast opt.

Speaker Change: Opportunities in the AI being green.

Speaker Change: Breaking it down further increase in the net revenue was primarily due to the increased sales of cloud platform products.

Callie Wong: These numbers help offset the declines in other areas, led by a continued shift toward subscription-based cloud platform products from one-time software purchases. Keep in mind that some of our revenue channels, like tech development services and software purchases, typically shine in the last quarter of the year.

Speaker Change: These numbers.

Speaker Change: Offset the declines in other areas.

Speaker Change: Led by a continued shift toward subscription base based cloud platform products from one time software purchases.

Speaker Change: Keep in mind that some of our revenue channels like Tech development services and software purchases.

Speaker Change: Secondly, Sean in the last quarter after yet.

Callie Wong: I'd also like to bring to your attention that the rise in cloud platform products is actually driven by the development of our mass business. As by nature, our mass business is mostly delivered through cloud platform products. In 2023, our mass business grew by 48.5 percent, reaching 19.2 million U.S. dollars, with the primary contributions attributed to our Huazang large-language model. At the same time, the mass business accounted for over 30 percent of total revenue for the first time.

Speaker Change: I'd also like to bring to your attention that device in the cloud platform product is actually driven by the development of our Ms business.

Speaker Change: That's my nature unless business is mostly delivered through cloud platform products in Tucson, and twenty-three unless business grew by 48, 5%, reaching $19 2 million U S dollars with the primary contribution attributed to al what's wrong.

Operator: In 2023, our MAS business grew by 48.5%, reaching $19.2 million, with the primary contributions attributed to our Hua Zang large language model. At the same time, the MAS business accounted for over 30% of the total revenue for the first time. On the profit front, we hit $39.4 million in gross profit, making a 28% increase from $30.8 million a year earlier. Moreover, our gross margin expansion unfolded as planned, standing at 66.6%, up from 63.9% in the previous year. The increase was primarily attributed to the significant increase in the proportion of revenues from sales of cloud platform products with a higher profit margin of 74.8%.

Kelly Weng: In 2023, our MAS business grew by 48.5%, reaching $19.2 million, with the primary contributions attributed to our Hua Zang large language model. At the same time, the MAS business accounted for over 30% of the total revenue for the first time. On the profit front, we hit $39.4 million in gross profit, making a 28% increase from $30.8 million a year earlier. Moreover, our gross margin expansion unfolded as planned, standing at 66.6%, up from 63.9% in the previous year. The increase was primarily attributed to the significant increase in the proportion of revenues from sales of cloud platform products with a higher profit margin of 74.8%.

Speaker Change: <unk> language model.

Speaker Change: At the same time, the mass business accounted for over 40% of the total revenue for the first time.

Callie Wong: On the profit front, we hit $39.4 million in gross profit, making a 28% increase from $30.8 million a year earlier. Moreover, our gross margin expansion performed as planned, standing at 66.6%, up from 63.9% in the previous year. The increase was primarily attributed to a significant increase in the proportion of revenues from Salesforce Cloud Platform products with a higher profit margin of 74.8 percent. Once again, I need to point out that it was mainly driven by the strong growth of mass, which embodied the core concept of providing AI models as a service to users rather than directly selling the models themselves.

Speaker Change: On the profit front, we hit $59 4 million in gross profit, making at 28% increase from $38 million a year early Moreover, our gross margin expansion and floated as planet.

Speaker Change: Sending at 66, six percentage up from 63 nine percentage in the previous year.

Speaker Change: The increase was primarily attributed to the significant increase in the proportion of revenues from sales of cloud platform products with a higher profit margin.

Speaker Change: 74.8 percentage.

Operator: Once again, I need to point it out that it was mainly driven by the strong growth of MaaS business embodied the core concept of providing AI models as a service to users rather than directly selling the models themselves. Our MaaS business model effectively reduced the barriers to using AI technology, enabling a broader range of businesses and developers to conveniently access and leverage AI models. Now moving to our operating expenses. Our total operating expenses were $61.3 million, up 80.7% from $33.9 million in the same period last year. Still, the majority of our operating expense increase was driven by a 118.3% surge in R&D expenses, which reached $52.4 million. This reflects our focused investment in the advanced large language model.

Kelly Weng: Once again, I need to point it out that it was mainly driven by the strong growth of MaaS business embodied the core concept of providing AI models as a service to users rather than directly selling the models themselves. Our MaaS business model effectively reduced the barriers to using AI technology, enabling a broader range of businesses and developers to conveniently access and leverage AI models. Now moving to our operating expenses. Our total operating expenses were $61.3 million, up 80.7% from $33.9 million in the same period last year. Still, the majority of our operating expense increase was driven by a 118.3% surge in R&D expenses, which reached $52.4 million. This reflects our focused investment in the advanced large language model.

Speaker Change: Once again I need you pointed out that it was mainly driven by the strong growth of mass business.

Speaker Change: And bought a core concept of providing AI models as a service to users rather than directly sharing the models themselves.

Callie Wong: Our mass business model effectively reduced the barriers to using AI technology by building a broader range of businesses and developers to conveniently assess the leveraged AI models. Now, moving to our operating expenses. Our total operating expenses were $61.3 million, up 80.7% from $33.9 million in the same period last year. However, the majority of our printing expense increase was driven by a 118.3% surge in R&D expenses, which reached $52.4 million. This reflects our focused investment in the advanced large-language model.

Speaker Change: <unk> business model effectively reduce the barriers to using AI to acknowledge.

Speaker Change: In banning a BARDA ranch.

Speaker Change: <unk> and developers to.

Speaker Change: Conveniently assess do you leverage AI models.

Speaker Change: Now moving to operating expenses.

Speaker Change: Total operating expenses were $61 3 million up 18.7 percentage from $33 9 million in the same period last year.

Speaker Change: Still the majority of our printing expense increase was driven by a 118.3 percentage searched in R&D expenses, which reached 52.4 million. This reflects our focused investment in the advanced large things as you model.

Operator: We expect our latest release, Hua Zang, will play a priority role in our long-term growth as our co-creation model matures. Subject to the foregoing, as well as the pipeline of announced products under development and all other continuing infrastructure growth, we currently expect our R&D investment to remain mainly at around 50% of our total revenue. As a result, our operating loss for 2023 was $21.9 million, compared with an operating loss of $3.1 million a year earlier. Net loss was $27 million, compared to a net loss of $6 million in 2022. Looking ahead, we remain committed to managing costs and enhancing efficiency as we focus on allocating resources strategically, particularly in the priority area of AI technology R&D. We believe this approach will position us well for continued growth and success.

Kelly Weng: We expect our latest release, Hua Zang, will play a priority role in our long-term growth as our co-creation model matures. Subject to the foregoing, as well as the pipeline of announced products under development and all other continuing infrastructure growth, we currently expect our R&D investment to remain mainly at around 50% of our total revenue. As a result, our operating loss for 2023 was $21.9 million, compared with an operating loss of $3.1 million a year earlier. Net loss was $27 million, compared to a net loss of $6 million in 2022. Looking ahead, we remain committed to managing costs and enhancing efficiency as we focus on allocating resources strategically, particularly in the priority area of AI technology R&D. We believe this approach will position us well for continued growth and success.

Callie Wong: We accept our latest release, Huazong, will play a priority role in our long-term growth as our co-creating model matters, only subject to the foregoing as well as the pipeline of announced products under development and all other continuing inflex structure groups. We currently limit our R&D investment to mainly around 50% of our total revenue. As a result, our operating loss for 2023 was $21.9 million, compared with an operating loss of $3.1 million a year earlier. Our net loss was $27 million, compared to a net loss of $6 million in 2022.

Speaker Change: We accept our lofty latest relief, while that's all well paid private table in our long term growth as all co creation model metrics.

Speaker Change: Boring day subject to this forward going as well as the pipeline.

Speaker Change: <unk> announced product.

Speaker Change: Development.

Speaker Change: And all other continuing in Flexjet chair groups, we currently except R&D investment to mainly at around 50% of our total revenue.

Speaker Change: As a result.

Speaker Change: Operating loss for 2023 one.

Speaker Change: $21 9 million compared with an operating loss of $3 1 million a year early net loss was $27 million compared to a net loss of $6 million in Tucson, and 22 <unk>.

Callie Wong: Looking ahead, we remain committed to managing costs and enhancing efficiency as we focus on allocating resources strategically, particularly in the private area of AI technology R&D. We believe this approach will position us well for continued growth and success. Thank you for your attention. We will now open the floor for questions. Operator, please go ahead.

Speaker Change: Looking ahead, we remain committed to managing costs and enhancing efficiency as we focused on allocating resources strategically.

Clearly in deep priority area.

Speaker Change: Of AI technology, and we believe this approach will position us well for continued growth and success.

Operator: Thank you for your attention. We will now open the floor for questions. Operator, please go ahead.

Kelly Weng: Thank you for your attention. We will now open the floor for questions. Operator, please go ahead.

Speaker Change: You for your attention we will now open the floor for questions. Operator. Please go ahead.

Operator: Thank you. To ask a question, you will need to press star one and one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. Thank you. We will now take our first question. This is from the line of Brian Lantier from Zacks Small-Cap Research. Please go ahead.

Speaker Change: Thank you.

Operator: To ask a question, you will need to press star 1 and 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1 and 1 again, standby while we compile the Q&A roster. Thank you. We will now take our first question. This is from the line of Brian Luntier from Zach's Small Cap Research. Please go ahead.

Speaker Change: To ask a question you will need to press star one and one on your telephone and wait for your name to be announced.

Speaker Change: To withdraw your question. Please press star one again.

Operator: Please standby, while we compile the Q&A roster.

Operator: Thank you.

Speaker Change: We will now take our first question.

Brian Lunch: This is from the line of Brian lunch, yet from Zacks small cap research. Please go ahead.

Brian Lantier: Good evening and good morning to those joining from the East Coast. I just wanted to touch base on the OOTDiffusion project. Get a little bit more color maybe around when you see that becoming a commercial product, and what you think the eventual pricing model will look like. Will it be principally a cloud service, or do you think that could be a new model that you'd be looking at?

Brian Luntier: Good evening and good morning to those joining from the East Coast. I just wanted to touch base on the OOT diffusion project, maybe give a little bit more color around when you see that becoming a commercial product and what you think the eventual pricing model will look like. Will it be principally a cloud service, or do you think that could be a new model that you'd be looking at?

Brian Lunch: Hi, good evening and good morning to those joining from the East coast.

Brian Lunch: I just wanted to touch base on the.

Brian Lunch: Oh Gee diffusion project.

Brian Lunch: Get a little bit more color, maybe around when you see that becoming a commercial product.

Brian Lunch: What you think the eventual pricing model will look like a bullet print.

Principally it cloud <unk>.

Brian Lunch: Service or do you think that could be.

Brian Lunch: A new model that you'd be looking at.

Brian Lunch: Okay.

Barry Sha: Thank you for your question, Brian. I'll need to translate a little bit here for our management team for better communication efficiency.

Operator: Thank you for your question, Brian. I'll need to translate a little bit here for our management team for better communication efficiency. Mr. Yuan, I'll need to translate for you first.

Brian Lunch: Okay.

Speaker Change: Thank you for your question, Brian I'll need to translate a little bit here for management teams for better communication efficiency.

Hui Yuan: First and foremost, thank you very much for this question. First of all, our online time should be around May. This is the first point. Second point is, for such a product, its pricing model. First of all, it is a consumer product. Its pricing model will be very similar to some of the applications on top of GPT, like other GPT large models. We will have subscriptions. Then in addition, based on the initial version, we will keep iterating. Subsequently, it will include subscriptions and some other based on the number of generated prompts used. We will have a very flexible pricing model.

Barry Sha: [Foreign language]

Speaker Change: Yes, all in tertiary or would you be I missed your question Bonnie Chinese now, Brian Chin Zacks copies. All Oh did you grow towards <unk> gone through a bunch of OTT.

Operator: Brian, the investor from ZEX Capital, just asked a question about our OOTD, diffusion model. First of all, he asked when our product will be put into operation. What is our business model like? For example, what level will it be priced at? Will we introduce a new business model? Or will we follow our old business model? That's the question. Bye.

Speaker Change: As you model.

Max Yuan: [Foreign language]

No sure I guess, you should have around 100 attending that Asher Mr Ho Ho.

Speaker Change: Now go to Michigan.

Speaker Change: A woman Sonya module.

The Georgia dock.

But I think that there's another 15 Nalco Jacobs Nashville final woman show, where you either singly Vishal I am wondering about how you Felicia Andrew Jordan, you define what the chip and actually Jonathan Thanks.

Max Yuan: First of all, I would like to thank you for this question. First of all, our launch date will be in May. This is the first point. The second point is that such a product, its payment model, is, first of all, a consumer product. SOFET will be very similar to other applications based on the ChessGPT model.

Speaker Change: So as you hope it answer your guys here to go ahead to go win T J D.

Speaker Change: So you're going to massage yesterday do you know how you can calculate that.

Speaker Change: We have that.

This is indeed the yard in hydro share it.

Speaker Change: How does it fit together.

Speaker Change: So I'll go to Moshe.

Moshe: Uh huh.

So I didn't answer your question Shelby.

Speaker Change: Tagline tickets have been.

Moshe: So how does the commercial huh.

Moshe: Well with Johnson <unk> Johnson.

Max Yuan: We will have a subscription mode, and we will continue to update according to the first version. Subsequently, there will be subscriptions and other modifications based on the generated number. There may be some very flexible business models for this transformation.

Moshe: You talked about in 2000, if you don't you don't.

Moshe: Yes.

Speaker Change: Thank you.

Moshe.

Speaker Change: We continue to take actions that do you get the final one.

Speaker Change: We're going to get the.

Speaker Change: Cause you to highway bulk or your <unk>.

Speaker Change: Do you guys see on it.

Speaker Change: And then as Amazon Shaw.

Speaker Change: Hey, Tommy.

Tommy: What should I seem to go against you.

Operator: So first, as for the product for OOTD, it is actually a very new product, so we're going to introduce a new business model. First of all, the product is going to be launched in May, very soon. And as for the new product, it's targeted at a consumer audience. So the business model will be similar to that of the GPT's, and will be conducted based on the subscription.

Barry Sha: I'll translate the answer from Max. First, as for the product for OOTD, it is actually a very new product, so we're going to introduce a new business model. First of all, the product's going to be launched in May, very soon. As for a new product, it's targeting at a consumer level audience. The business model will be similar to that of the GPTs, will be conducted based on the subscription. As for the first edition will be coming from the subscription, but later there will be a one-off generative business model as well. Based on the picture they generated, the service they get, we get additional payment as well.

Tommy: No wonder it into 19.

Speaker Change: Chuck played Avi answer from Max So first as for the product or T. D. It is actually a very new product. So we're going to introduce a new business model.

Speaker Change: First of all the products going to be launched and May very soon and.

Speaker Change: For a new product is targeting Eddie comes from consumer edge.

Speaker Change: Our audience. So the business model will be similar to that of their gbt's will be conducted based on to subscription.

Operator: And as for the first edition, it will come from the subscription. But later, there will be ones based on the generative business model as well, based on the picture that generated the service, the gap, and the additional payment as well. So that is the information for understanding. We hope we answered your question. Thank you, Brian.

Speaker Change: And.

Speaker Change: As for the <unk>.

Speaker Change: First edition of becoming from the other subscription subscription, but it'd be later, there will be a once off.

Speaker Change: Generative.

Speaker Change: And that business model as well based on the picture that generated the service the Gatsby again additional.

Barry Sha: That is the information for your understanding. We hope we answered your question. Thank you, Brian.

Speaker Change: Our payment as well so that as information for understanding we hope we answered your question. Thank you Brian.

Brian Lantier: Great. Thank you. If I could just follow up with one other question regarding the DIF. I think you called it the DIF, the Daily Invest Focus. I haven't seen too much information on that. Will that be a consumer product for everyday investors or would that be a product you'd be marketing to some of your banking clients?

Brian Lunch: Great. Thank you.

Speaker Change: And if I could just follow up with one other.

Brian Luntier: And I could just follow up with one other question regarding the DIF, the Daily Investor Focus. I haven't seen too much information on that. Will that be a consumer product for everyday investors, or would that be a product you'd be marketing to some of your banking clients?

Speaker Change: Question regarding the I think you called it could dip the daily Investor focus.

Speaker Change: I don't I haven't seen too much information on that will that be a consumer product for.

Speaker Change: Everyday investors or would that be a product marketing to some of your banking clients.

Barry Sha: 袁总，那 Brian 的第二个问题呢，就是关于我们新的那个产品，就是叫 DIF 的，就是 Daily Invest Focus 这个产品。那他有问到就是这个产品的话，首先是，就是它是针对哪个客群，是针对个人投资者，还是说是有一些银行或者是 B 端的一些客户，大概是这样的一个问题。

Barry Sha: First, thank you. [Foreign language]

Speaker Change: Alright, thank you.

Speaker Change: No Brian that Theyre going to Miss your way what machine, a <expletive> chanting tissue John D for that just your daily invest circa champion and entitlement that I'll just share sort of a champion of the harsher Tien share do you think your agenda and are coaching she couldn't do a go until such a harsh Russia. Let me show you how well it should be from Asia.

Operator: All right, thank you. Yuan Zong, Brian's second question was about our new product, which is called DEEF, which stands for Daily Invest Focus. He asked, which customer group is this product targeted at? Is it targeted at individual investors, or is it targeted at some banks or B-level clients? That's probably the question.

Speaker Change: Cool.

Jonathan: Sure Jonathan.

Hui Yuan: 首先，DIF 这个平台，DIF 这个产品的话，它实际上是一个平台，是一个我们基于大模型和 RPA 这样一个产品，结合而成的这样一个平台。这个平台它实际上未来会衍生很多的针对不同场景的这样一些应用，包括针对相应的投研报告，包括论文的写作，还有包括一些其他的，针对大量数据，包括文本知识进行处理，它可能会在不同的细分市场上面都会体现这个应用。那我们在下个月也会上线 DIF 这个平台之上的第一款产品。这个产品的话，我们很快就会预告，它基本上会针对美国的个人投资者，会有一个比较好的这样一个数据分析，或者是相应的这样一个参考，来帮助个人投资者有一个比较好的辅助，这样一个数据决策，以达到一定的基于大模型之上的一个人工智能这样一个产品的应用。

Max Yuan: [Foreign language]

So again to your particular pins.

Speaker Change: You guys have.

Speaker Change: Tushar answer European tire.

Speaker Change: Women's EBITDA margin.

Speaker Change: Hey, guys.

Speaker Change: Sure.

Tushar: <unk>, yes.

Speaker Change: And are there tended with hometown.

Speaker Change: Bulk of those 10 days shining.

Max Yuan: First of all, DEAF is a platform based on large-scale models and RPA. In the future, this platform will introduce a lot of applications for different scenarios, including for corresponding head-to-head reports, for writing papers, and for processing a large amount of data, including text knowledge. It may be applied in different markets. Next month, we will also launch the first product on the DEAF platform. We will soon announce that this product will have better data analysis or corresponding reference for individual investors in the United States to help individual investors make better data decisions to achieve a certain application of artificial intelligence on large-scale models.

Speaker Change: <unk> totally embargo vocal luma initiate Shaw Auerbach with Chicago.

Speaker Change: And I guess switching to buckle windburn juices truly tuck in a way that put on the shelf.

Speaker Change: You have to get you know.

Speaker Change: I wouldn't say shadow it sounds yen to go deep with a pin that you sounded quite a bit.

Speaker Change: At this time in Nevada.

Speaker Change: One of them graduated.

Speaker Change: I'll keep it that way.

Speaker Change: What does it take.

Speaker Change: Go ahead and Tokyo.

Speaker Change: Yeah, Hi, there guys.

Speaker Change: So would you say.

Speaker Change: China and Hong.

Speaker Change: Hancock.

<unk> towards it.

Speaker Change: I can tell you that acquire you're good.

Speaker Change: I think it would be a hard time good to go for <unk> should use fujitsu.

Speaker Change: You didn't know.

Speaker Change: Ah you're dominant in Tucson that you could get once it ends.

Speaker Change: Got you.

Barry Sha: Thank you, Yuan Zong. Brian, for your question regarding the DIF Daily Invest Focus, this product is actually a new platform, dedicated to deliver as a agent or copilot for our potential investors, potential customers. The first application scenario will be located in the financial industries. Of course, as a platform, it will be further expanded into different scenarios. For example, not only for the finance industry, like the analysis and also investment analysis, but it will be further expanded into, you know, the research report writing, the asset allocation or even the market and the market analysis reports, etc.

Speaker Change: Yeah.

Operator: Xie Yuanzong. Brian, so for your question as regards this daily investing focus, this product is actually a new platform dedicated to delivering as an agent or co-pilot for our potential investors, potential customers. The first application scenario will be located in the financial industries, but, of course, as a platform, it will be further expanded into different industries. For example, not only for the finance industry, like analysis and investment analysis, but it will be further expanded into research report writing, asset writing, or even market analysis reports, etc. All of the vertical industry applications, the scenarios that might rely on the report writing scenarios, we cannot further penetrate.

Speaker Change: Susan.

Speaker Change: Brian. So first question is regarding to this daily embossed focus.

Speaker Change: This product is actually a new plan.

Speaker Change: <unk> for.

Speaker Change: Dedicated to deliver.

Speaker Change: <unk> agents or co pilots for our potential investors.

Potential customers.

Speaker Change: The first application scenario will be located in the financial industry.

Speaker Change: But of course as a platform it will be further expanded into different scenarios for example.

Speaker Change: Not only for the finance industry.

Speaker Change: Analysis.

Speaker Change: And also investment analysis.

Speaker Change: But rather than will be further expanded into the <unk>.

Speaker Change: Research report, writing the assay, writing or even.

Speaker Change: The market.

Speaker Change: The market analysis.

Barry Sha: All of the vertical industry applications, the scenarios that might rely on the report writing scenarios we can further penetrate into. As for this first scenario of the financial industry, we will be introducing the very first product based on this platform in May. This product is more like a daily report first, because you can see the product name itself is called Daily Invest Focus. This first product will firmly rely on the target audience or the potential consumers from the retail investor side.

Speaker Change: The ports et cetera, all of the.

Vertical industry applications. These scenarios that might rely on the report writing scenarios to begin.

Speaker Change: Further penetrating into.

Operator: So as for the first scenario of the financial industry, we will be introducing the very first product based on this platform in May. So this product is more like a daily report first, because you can see the product name itself is called Daily Best Focus. So this first product will firmly rely on the target audience or the potential consumers from the retail investor site. We help them to collect market information, sentiment, market sentiment, or even sometimes the per incident alert from the capital market site to give our retail investors full data support on their investment.

So as for these first scenario of the financial industry.

We will be introducing the very first products based on this platform.

Speaker Change: So this product is more like a daily report first because you can see that product name itself. It's cod date.

Box focus.

Speaker Change: So this first product will be firmly rely on target audience or the potential consumers from a retail investor site, we help them to collect market information sentiment.

Barry Sha: We help them to collect market information, sentiments, market sentiments, or even sometimes, the per incident alert from the capital market side to give our retail investors a fully data support on their investment, make them more confident, make them resourceful upon the data side and as well as the information side. This platform is developed based on our large language model together with the multi-agent workflow, the agentic workflow, and also the multi-agent system. One of these agent is using the RPAs and also the others are utilizing the data analysis, data mining and the different agents been in the queue to handling the process based on our consumers request.

Speaker Change: Market sentiment or even sometimes.

Speaker Change: The pair.

Her incident alerts from the capital market side to give our retail investors is fully.

Operator: May they be more confident, may they be resourceful on the data site and as well as the information site. So this platform is developed based on our large model together with the multi-agent workflow, the agentic workflow, and also the multi-agent system. One of these agents is using RPAs, and also others are utilizing data analysis, data mining, and different agents being in the queue to handle the process based on our consumer's request.

Data support on their investments made there more confident.

Speaker Change: Resourceful upon the data side.

Speaker Change: All of the information side.

So this platform is developed based on our large French model together with Abbvie.

Speaker Change: That'd be the multi agent workflow I think the <unk> workflow and also the multi agent system.

One of these agents as using the RPE as an author of the others.

Are utilizing the data analysis and data mining and the different agents has been in the queue to handling the process on the bet based on our consumers request. So it's going to be a very new business model as well as a platform that will go into you introduced your investors sorry, alright consumers and then we were hoping.

Barry Sha: It's going to be a very new business model as well as the platform that we're going to introduce to our investors. Sorry, our consumers. We were hoping the AI is really making their life much better, making their investment much easier, to give them more rights and access to the information in the market. That would be an answer to your question. Thank you.

Operator: So it's going to be a very new business model, as well as a platform that we're going to introduce to our investors, sorry, our consumers. And then we hope AI is really making their lives much better, making their investment much easier to give them more rights and access to information in the market.

Speaker Change: In the AI is really making their life much better making their investment much easier.

Speaker Change: To give them more rights and access to the information in.

Operator: So that would be an answer to a question. Thank you. Great.

Speaker Change: In the market so that it would be your answer to your question. Thank you.

Brian Luntier: Okay, great. Thank you so much for that. Thank you.

Brian Lantier: Great. Thank you so much for that.

Speaker Change: Okay, great. Thank you so much for that.

Operator: Thank you. We will now take our next question. Please stand by. This is from the line of Wilson Lu from Forasian Investment. Sorry, Forasian Investment. Please go ahead.

Speaker Change: Yeah.

Speaker Change: Thank you.

Operator: We will now take our next question. Please stand by. This is from the line of Wilson Liu from 4Asian Investment. Please go ahead.

Speaker Change: Okay.

Speaker Change: We will now take our next question.

Speaker Change: Please standby.

Speaker Change: This is from the line of Wilson Lu from formation that what sorry <unk> investments. Please go ahead.

Wilson Lu: Yes, this is Wilson Lu. It sounds very attractive and interesting, so I have a question for you. I would like to ask how you view the future development trend of the big data model industry. Thank you.

Wilson Liu: Thank you, Wilson. I'll translate for Max as well. The first question from Wilson is, how do we look at the future trends of the large model industry, Mr. Yuan? (inaudible)

Speaker Change: Yes.

Yes.

The songs.

Wilson Lu: We are testing and just so I have a question for you.

Wilson Lu: I would like to ask.

Wilson Lu: How do you view, the future DRAM and trends of the big data module industry.

Speaker Change: Thank you.

Speaker Change: Okay.

Barry Sha: Thank you, Wilson. I'll translate for Max as well. 那 Wilson 这边的第一个问题是说我们怎么看这个大模型行业的未来的一个趋势？袁总。

Barry Sha: Thank you, Wilson. I'll translate for Max as well. [Foreign language]

Max Yuan: In our understanding, the biggest obstacle for AI in the past was that AI technology was not able to provide such a convenient opportunity for all industries. It could only be chosen by a specific industry.

Alright, Thank you Wilson.

Speaker Change: I will translate for in Mexico.

Speaker Change: Wilson, Japan that Eagle, then tissue for women's Mccann Jugal, Tom was higher without that.

Hui Yuan: 大模型的话，我们的这个理解的话是，大模型之前的话，对AI这个行业最重要的这个障碍是在于说AI的这个技术不能够为所有的行业提供这样一个变现这样一个机会，可能只能选择某些特定这种行业。但是随着大模型最近这两年这个爆发的话，我们会看到说大模型有能力能够推动所有的行业在同一时间能够进行这个爆发。当然今天的话，大模型的话，在全球的话也有不同的这个发展，这个趋势和这种观点。第一种观点可能会认为说这个大模型的话跟AGI之间这样一种关系，这个也有公司会谈到说这个大模型的话，基本上是AGI这个未来。但是从我们这边这个角度来看的话，我们不认为说大模型的话是能够决定这个AGI的。因为人类过去六十年以来，人工智能这样一个底层的框架并没有被突破，我们现在并不认为说大模型就能够实现AGI。但是反过来讲的话，大模型的话一个最大的价值就是我刚刚提到的大模型在今天它已经有能力为所有的行业能够提供一个巨大的这个降本增效这样一个，这样一个机会。所以今天对大模型来讲的话，大模型的这个发展的话，因为如何商业化变现，这将是最重要的一个问题，而且如何把大模型能够更有效地这个降低这个成本。所以我们在去年发布我们自己华藏大模型的时候，我们会谈到第一个要可控，如何能够比如控制大模型的这个幻觉，包括以这个相应的伦理道德，这是第一点。第二点的话，要这个可定制，因为所有的大模型的话，最终能够进入到每一个场景，每一个行业的话，它一定能够，而且是一定要求需要被满足行业的这样一个这种特定这种要求。第三个就是要可交付。因为今天并不是每一家公司的话，都可以花$200亿去买几十万台的这样一个GPU去处理这个事情。而且全球开源社区的话，也为了这个降低这个成本，正在大规模地不断尝试用小模型去实现这样一种趋势。总结来讲的话，大模型未来的话就是已经整个人工智能这个行业已经因为大模型的这个爆发，我们已经进入到高速这个成长，而且所有的行业都需要被AI赋能这个阶段，这已经是一个毋庸置疑的这个事实。但是反过来讲，说大模型的话，并不代表说你投入巨大，而且持续不断这个投入就一定会有AGI。所以今天商业变现的话，可能更需要说我们用更可控、可定制、可交付的这样一种方式，用这个更低的这个成本，更高的这个效率，利用大模型的话，利用小模型，利用数据，利用应用场景，把这些综合的优势能够进行结合，从而能够推动快速在C端和B端这个变现，这可能是未来整个大模型发展的一个非常重要的一点。否则大模型的话会跟过去技术只是单纯的发展技术而不能变现的话，最后对整个这个未来发展趋势是毫无意义的。Barry。

Max Yuan: [Foreign language]

Speaker Change: Sure.

Speaker Change:

Speaker Change: Thomas you know women.

Dow.

Speaker Change: How much interest here in Hawaii.

Speaker Change: So you're doing out there.

Thomas: Some I should say so yeah, that's useful putting them go away so the higher coupons and good.

Max Yuan: However, with the recent outbreak of big models in the past two years, we can see that big models are able to push all industries to break out at the same time. Of course, there are different trends and views on big models around the world. The first view is that big models have a relationship with AGI. Some companies say that big models are the future of computer graphics. However, from our point of view, we don't think that big models can decide AGI. In the past 60 years, the framework of AI has not been broken through.

Yeah damage you quick lines of initiating a multiyear kicking into high gear.

Thomas: Don't see the download.

Thomas: Good ball part of all of them were kind of a domino here.

Thomas: It almost <unk>.

Thomas: I can't give you a ballpark that you need a lot of time looking at why does.

Thomas: Has that changed or the high yield with all medical fact that degree of tissue.

Speaker Change: Hold on one day.

Speaker Change: Indeed in lending going away.

Speaker Change: Once the new Hawker Hei's guidance question.

Speaker Change: Is it good to great yoga.

Speaker Change: Sure.

Speaker Change: I think that is.

Speaker Change: As a woman to be integrally jugular icon heartworm, but allow me to Tom Harrington to go with JD integrate what.

Tom Harrington: Are you doing any levels of integrity and according to App email based tool.

Max Yuan: We don't think that big models can achieve AI. On the other hand, the biggest value of big models, as I mentioned earlier, is that they are able to provide a huge opportunity for all industries to break out at the same time. So, for big models today, the most important question is how to commercialize the development of big models and how to reduce the cost of big models more effectively. Last year, when we announced that we would develop big models, we talked about how to control the illusion of big models, including the ethical ethics of big models.

Tom Harrington: That being poorly on ways to establishing Jordan groceries.

Got it.

Tom Harrington: Most of you know how you can see it on the chassis general balance sheet other dominant in Virginia, and how you deal with them anyway.

Speaker Change: I'll go to you go when you go through that I think a jumbo Dr. Zheng Chen goods.

Speaker Change: Tom What you imagine why are you going to Hamilton took a fast and hot you may <unk>.

Speaker Change: Some of your hobbies, so Johnson <unk>.

Speaker Change: You'll hear about that most of you know Luca you shall do forget Jon do you think those have been favorable.

Speaker Change: And so I don't know Mike.

Do you agree all court ruling you've got Peter Collins, Dominic you need to go out and Jay about Hawaii.

Speaker Change: Got it.

Speaker Change: Okay.

Speaker Change: So who are the dominant university to undergo tuned Amit you guys. How do you how are you thinking about Rcs eating gaucho Xiang pay module.

Max Yuan: The second point is that big models should be customizable. Because if all big models can eventually enter every industry, they must be satisfied. And all industries need to be re-enabled by AI at this stage. This is an undeniable fact.

Speaker Change: How many of those angles on <unk>, the second major Yao Codell Fool you engineer because it makes everyone feel like there'll be a high level. You mentioned you might provide and how does that with GPU to fully negotiating artichoke, having such a high year, where does it get challenged you guys have mentioned that.

Speaker Change: I'm sure you'll hear most interested here kind of future.

Speaker Change: Hi, just a generic entrant.

Max Yuan: But on the other hand, big models do not mean that if you invest a lot and continue to invest, you will definitely have AGI. So today's commercial development may require us to use a more controllable, customizable, and affordable way to use smaller models, use data, and use applications to combine these comprehensive advantages in order to promote the rapid development of C-end and B-end. This may be a very important point for the development of the entire big model in the future. Otherwise, the big model will only be a simple development technology and will not be able to transform. In the end, it will be meaningless for the entire future development trend.

Speaker Change: Thomas you would Idaho.

Speaker Change: These integrated most of them to go home.

Speaker Change: Tom what you need to get both our messaging Doc.

Thomas: Thanks Lucas.

Thomas: Shelby.

Speaker Change: Good luck to you.

Speaker Change: But we don't see it.

Speaker Change: Exactly.

Speaker Change: How much do you know how people behave accordingly, total Judah RJ tissue, providing a total with Joe you didn't hei.

Speaker Change: So your opinion about it because I'm getting sure why couldn't Cook home contingent with gel for the data puncture.

Speaker Change: Okay.

Speaker Change: Got it if we could shout it downloads you Noah.

Speaker Change: I'm with you.

Speaker Change: <unk> challenging.

Speaker Change: 200 <unk>.

Speaker Change: Rotate them quiet.

Speaker Change: So you definitely see that there could be it yet.

Is that what you thought that the pay downs that you get for.

Speaker Change: Whether that was a new half with them of course you Tito.

Speaker Change: And in fact that is due to open in Tianjin Hua Zhu hotels are good it's a good way.

Speaker Change: So how we eat.

Operator: Yes, I will do the translation right now. So the first conclusion is that it is the time point for the commercialization of large-unit model and AI technologies. The general thinking in the industry is that we need to create AGI. One must stack up scale and computational power with the notion that the larger the model, the better its performance, which is the scaling law: the bigger, the better. The idea is that the bigger the model, the better it works. But to be honest, we are not totally sold on the idea.

Speaker Change: Barry.

Barry Sha: Yeah, yeah, yes. I would do the translation right now. Here's the conclusion first, Wilson, is that it is the time point for the commercialization of large language model and AI technologies. The general thinking in the industry is that we need to create AGI.

Speaker Change: Yes, yes, yes, I will do the translation right now.

So here's the conclusion first Wilson.

Yes.

Speaker Change: At the time point for the commercialization of large auction model and AI technologies. The general thinking in the industry is that we need to create agi, one less stock upscale in computation of power and with the notion that the large.

Barry Sha: One must stack up scale and computational power and with the notion that the larger the model that the better its performance, which is a scaling law, the bigger the better. The idea is that the bigger the model the better it works. To be honest, we are not totally sold on that idea. There's a catch although, but it's expensive. The bigger the model, the more it costs to train it. You need a lot of computing power and data, and there's no easy way around it. It's like, trying to turn lead into gold, it takes a lot of trial and error, and that needs a lot of computing power. Because of this, we are considering the most important thing to do right now is to deliver, based on the architecture that this, the technology framework we have, the large language model, and we deliver the model that can be customized, can be delivered with cost effective, and also can be, and can be commercialized. What we do right now is, we were considering, like for example, for business to business scenarios, the enterprise level large language models, we do not require such high performance. You don't need a cannon to shoot a sparrow. As the current capability of large language models is already sufficient to significantly enhance the corporate operation efficiency. What matters more is whether it makes economic sense and if the experience is good. The key to large language model is always to tie them into business needs and process in a way that makes sense. For the consumer side, with the development of large language model, the applicable scenarios of the AI products are rapidly increasing. We're seeing more and more uses of AI, so it's like a blue ocean. This year, we might just see more, really popular apps and that develop based on the large language model. For example, like the previous product we've been introduced, the Daily Invest Focus and also, the OOTDiffusion, all of these are, the C-side the company is trying to explore on. We hope we answered your question. Thank you, Wilson.

Speaker Change: Larger tomorrow that the batters performance, which is a scaling law the bigger the better ideas that the bigger the model the better it works but to be honest.

Speaker Change: Not totally sold on the idea.

Operator: There's a catch, though: it's expensive. The bigger the model, the more it costs to train it. So you need a lot of computing power and data, and there's no easy way around it. So it's like trying to turn lead into gold.

Speaker Change: There is a catch although but it's expensive the burger to model the more it costs to train. So you need a lot of computing power and data and there are no. There is no easy way around it so it's like.

Speaker Change: Trying to turn leading to call. It takes a lot of trial and error and that means a lot of computing power. So because of this we are considering the most important thing to do right now is to deliver a based on an architecture.

Operator: It takes a lot of trial and error, and that means a lot of computing power. So because of this, we are considering the most important thing to do right now is to deliver based on the architecture, the technology framework we have, the large-scale model, and we deliver a model that can be customized, can be delivered at a cost effective, and also can be commercialized. So what we do right now is we consider, like, for example, for business-to-business scenarios, the enterprise-level large-language models; we do not require such high performance. You don't need a cannon to shoot a sparrow.

Barry Sha: Because of this, we are considering the most important thing to do right now is to deliver, based on the architecture that this, the technology framework we have, the large language model, and we deliver the model that can be customized, can be delivered with cost effective, and also can be, and can be commercialized. What we do right now is, we were considering, like for example, for business to business scenarios, the enterprise level large language models, we do not require such high performance. You don't need a cannon to shoot a sparrow. As the current capability of large language models is already sufficient to significantly enhance the corporate operation efficiency.

Speaker Change: The technology frame.

Speaker Change: <unk> framework, we have for Marshalls model and we delivered the motto that can be customized can be delivered live.

Speaker Change: Cost effective and also can be.

Speaker Change: Can can be commercialized.

Speaker Change: No.

Speaker Change: So what we do right now is we were considering.

Speaker Change: Like for example for a business to business scenarios to enterprise level large models, we do not require such high performance you don't need it can into charter sparrow. So as the current out capability of large language models is already sufficient to significantly enhance the corporate operation efficiency.

Operator: As the current capability of large-language models is already sufficient to significantly enhance corporate operation efficiency, what matters more is whether it makes economic sense and if the experience is good. So the key to large-language models is always to tie them into business needs and processes in a way that makes sense. And for the consumer side, with the development of large-language models, the applicable scenarios of AI products are rapidly increasing, and we're seeing more and more uses of AI.

Barry Sha: What matters more is whether it makes economic sense and if the experience is good. The key to large language model is always to tie them into business needs and process in a way that makes sense. For the consumer side, with the development of large language model, the applicable scenarios of the AI products are rapidly increasing. We're seeing more and more uses of AI, so it's like a blue ocean.

Speaker Change: So what matters more is whether it.

Speaker Change: Makes economic sense and it experienced this Scott.

Speaker Change: So the key to large language model, it's always should tie them into business units and process in a way that makes sense and for the consumer side with the development of large tranche model the application applicable scenarios.

Speaker Change: Our products are rapidly rapidly increasing were seeing more and more usage of AI. So it's like a blue ocean. So this year, we might just see more are really popular apps and that developed based on the long term model.

Operator: So it's like a blue ocean. So this year, we might just see more really popular apps that develop based on the large-runch model. For example, like the Purvis product we've been introduced to, the Data Invest focus, and also the OOT diffusion.

Barry Sha: This year, we might just see more, really popular apps and that develop based on the large language model. For example, like the previous product we've been introduced, the Daily Invest Focus and also, the OOTDiffusion, all of these are, the C-side the company is trying to explore on. We hope we answered your question. Thank you, Wilson.

Speaker Change: For example, like the previous product we're being introduced.

In fact, <unk> and also the.

Operator: All of these are the seaside that the company is trying to explore. So we hope we have answered your question. Thank you. You're welcome.

Speaker Change: Oh TD fusion all of these are on the fee side with companies trying to explore on so we hope you asked we answered your question. Thank you Wilson.

Hui Yuan: Thank you. We'll now take our next question. This is from Anthony Cheng from BE Investment. Please go ahead.

Operator: Thank you. We'll now take our next question. This is from Anthony Cheng from BE Investment. Please go ahead.

Speaker Change: Thank you.

Anthony Chang: We'll now take our next question. This is from Anthony Chang from BE Investments. Please go ahead.

We'll now take our next question.

This is from Anthony Chang from BD investments. Please go ahead.

Anthony Cheng: Hi, dear management, thank you for the answers. I would like to follow up your previous answer that there are indeed many different application scenario for your business model. I can hear that you have clients in financial institution, Telecom, pharmaceutical, manufacturing, and local government. Which client base are you going to focus more? And what are your strategy for those client base? Thank you.

Operator: Hi, dear management, thank you for the answers. I would like to follow up your previous answer that there are indeed many different applications and scenarios for your business model. I can hear that you have clients in financial institutions, telecom, pharmaceutical manufacturing, and local government, but which client base are you going to focus on more and what are your strategies for those client bases? Thank you.

Anthony Chang: Hi, Dear management, Thank you for that.

Anthony Chang: This is I would like to follow up your previous answer that they're indeed, many different applications scenario for for your business model.

I can hear that you have clients in financial institutions Telecom.

Anthony Chang: Telecom on and.

Anthony Chang: And pharmaceutical manufacturing local golf and learn but.

Anthony Chang: Our client base are you going to focus more and what are your strategy for those client base. Thank you.

Barry Sha: Yeah, thank you. I'll translate here. Anthony 刚刚问了一个问题说，公司就目前的这个客户其实是非常广的，就我们涉及的这个商业情形，包括就场景，包括药企啊，或者是这个三大电信运营商啊，银行啊，就是这一些我们都有很多的客户，包括这个地方政府这些我们都有很多相应的客户制造。那，就是他的问题是说我们未来的客户的话呢，主要是，就是集中在哪个部分，然后我们的主要的这个策略是集中在哪个，哪些场景的客户，这个大概是一个问题给这个 Anthony 提过来。

Barry Sha: Yeah, thank you. I'll translate here. [Foreign language]

Operator: Yeah, thank you. I'll translate it here. [inaudible]

Yeah. Thank you Eric translate here.

Anthony Chang: Anthony go from violent you sure.

Max Yuan: First of all, in the future, there will be 2B and 2C. You may be more interested in the 2B industry. In the 2B industry, although big models have the ability to promote all industries, we also agree with the previous question. In the industry, we will focus on some industries. In the 2B industry, we will focus on call centers and smart finance. These industries have high value-added, relatively good infrastructure, and high digitalization. In the past, we have had a very good accumulation. We have more than 1,000 large customers. They may come from the call center industry.

Speaker Change: Concern from Luton took a couple of chairs you for Hong Kong that Andre women. Shortly thank you Sean.

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Speaker Change: Sure J&J women don't your political buckle, Joe give Andrew Jones Deutsche Bank, a couple of thoughts.

Speaker Change: Joseph rather than tissue Shlomo, we relied a cooler financial Usher gestured Jonathan.

Speaker Change: Uh huh.

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Speaker Change: Actually he doesn't.

Davidson.

Hui Yuan: 我们首先的话是在这个整个产品的话，未来的话会分成To B和To C。那刚才这个问题的话，可能更多的话会关注到这个To B的这个行业的这样一个区分。在To B这个行业里面的话，尽管说大模型的话，它是有能力推动所有这个行业，但是我们也同意刚才这样一个问题，就是在行业当中来讲的话，我们还是会有一些这种聚焦。那聚焦的行业的话，目前主要我们会包括像这个呼叫中心啊，像这个智慧金融啊，类似像这样的这个行业高附加值，而且目前相对基础比较好，数字化程度比较高的这些行业，是我们过去一个非常好的这个积累，我们大概有超过一千家这种大型客户，他们可能是来自于这个呼叫中心这样一个行业。那另外的话，还有很多的银行、证券、保险是来自于这些金融这个行业，那这个无论是在国内市场还是在这个海外市场的话，这都是一个全球化的，而且都是非常巨大的这样一个持续不断成长，而且AI能够赋能的行业。那这些行业的话，是我们会继续不断地这个深挖，而且说通过大模型的进一步这个技术这样一个迭代和发展，能够快速地把原来这些行业本身就能够拥抱人工智能技术，同时因为大模型的话能够迅速进行刷新和改变，那能够进一步释放这个行业本身的这样一个巨大价值。那另外的话，就是我们也会聚焦在这个新的这个消费者这个市场，因为消费的市场在过去人工智能技术这个发展过程中来讲，并没有一个特别大的这样一个显现。但今天在大模型这个新的这个技术之上的话，我们会看到说实际上包括我们刚才举的例子，像这个DIF，D-I-F是Daily Invest Focus，包括像这个OOTDiffusion这样一些很直接能够在消费者这个领域能够快速产生这个变现价值的，还有包括一些硬件，接下来在未来两个月，我们可能也会有一些包括ESG的这样一些硬件，直接都会这个变现到这个消费者整个手上。所以的话，我们会这个在To B的这个行业，我们会聚焦非常重要的、有雄厚基础的，包括这个持续能够成长的巨大的这个行业，那同时也会考虑说在这个原来AI技术所不能覆盖的像C端的这个部分，包括像出海这个部分的话，我们都会进一步这个投入和这种扩张。

Max Yuan: [Foreign language]

Speaker Change: Yes.

Speaker Change: Well the associated losses.

Speaker Change: Okay.

Speaker Change: It is indeed to be trophy now Glenn How's. It go when you have good quick wanted us to be highly language human.

Speaker Change: To be the high end of June so dominant in Ohio.

Hi, it's.

Max Yuan: In addition, there is a lot of financial insurance from the financial industry. Whether in the domestic or overseas markets, this is a globalized and very huge industry that continues to grow and is still able to recover. In these industries, we will continue to dig deeper, and through the further technological generation and development of large models, we can quickly embrace artificial intelligence technology in these industries. At the same time, large models can refresh and change rapidly and further release the great value of the industry itself.

Speaker Change: Well I mean, when you got that dangled warranties you hit the high power High School you don't you Joe.

Speaker Change: Hi, Moshe we all one word buggers Jonathan.

Speaker Change: Thanks Jeanne Johns.

Speaker Change: Jonathan.

Speaker Change: So as you know.

John: This is John.

John: Gulf with Dr. Rajiv margin challenges, it will be or how should the Hudson.

Jonathan: Sure of course, you go through the harder it would be good to get Chile <unk> cohort.

Jonathan: As youre likely to years ago, Doug Doug how are you.

Jonathan: Hi, guys, Hi, Alejandro the encounter Jimbo's, yes. So as you sit here now I think I will ask Doug what initiatives or is that the hardware to software.

Doug: For those of you got you and Johan <unk> dose.

Doug: <unk> she put onto the RJ.

Doug: Hi.

Doug: Yeah, Hi, washerwoman quit tissue.

Doug: So while our teeth tongue without looking to achieve with <unk>.

Doug: Okay.

Max Yuan: In addition, we will also focus on the new consumer market. In the past, in the development of artificial intelligence technology, the consumer market did not have a particularly large display. But today, with the new technology of large models, we will see that, including the examples we just mentioned, such as DIF, D-I-F, Daily Invest, Investor Focus, and OOTD, which can quickly generate variable value in the consumer field. In the next two months, we may also have ESG hardware, which will be directly transferred to the hands of consumers.

Doug: What about.

Doug: The higher but didn't Jordan angle, but it wasn't as usual Tony you made how much negotiate torches and slashing hook Ibs.

Doug: <unk> hired but its in a damn good job.

Doug: Now the amount of hydrogen.

Doug: Uh huh.

Doug: She knows it shove. It if you got yourself you may Shelby does that cause you to move it and see if we can go.

Doug: Within the female you've got to be thought as Angus just yet.

Doug: We knew that that machine.

Doug: She knows it gets used with design home, what kind of a bubble.

Speaker Change: Hi, Judy.

Speaker Change: Leave the challenge.

Speaker Change: Daily mess.

Judy: I think a focus of ours.

Judy: OTT.

Judy: Yes, Julian Angola, shelving and mirror.

Judy: My question was answered and took a beating and Joshua I Hope I was in India.

Speaker Change: Hey, guys good to see.

Speaker Change: Yes.

Speaker Change: I'll give you a woman.

But what <unk> is actually doing in June so you get a way to go behind BELBUCA geographies, Canada.

Speaker Change: So you have one way to go.

Speaker Change: Got it attributed the higher on what you.

Speaker Change: So just.

Speaker Change: But once it gets tricky and I'm going to not that you don't have to go higher.

Max Yuan: Therefore, in the industry of 2B, we will focus on very important and rich infrastructure, including this huge industry that continues to grow. At the same time, we will also consider the part that cannot be covered by the original AI technology, such as the C-end, including the part of the sea. We will further invest in and expand. Okay, thank you, Yuan Zai.

Speaker Change: How do you suppose that it.

Speaker Change: That's helpful and then forgot it's young so Uganda, Guebuza borrowers who had to go book and allow him to our team for their total hurdle quota.

Barry Sha: Okay, thank you, Chairman Yuan. Anthony, thank you for your question. Here's a conclusion first. Your question is actually a very good one, because it's a very important question which customer we're going to focus on. First we wanted to answer that there's 2 dimensions. First one is actually business to business, and second one is actually business to consumers. Like you've been previously talk about, we have a very large customer base. We covered the industry from manufacturing to finance and also to the couriers. Maybe all of these clients are within our customer base. Then for these customer bases, we're going to dig deeper into their customer needs, and we will rely on their business development process, their strategies to see whether or not they are strong enough to carry more AI technology applications. We will focus on their pain point to deliver customized large language models combined and integrated AI solutions. For the business to business scenario, we will further rely on 1,000 delivery cases which we acquired within this more than 20 years journeys in its commercialization experience. We will further dig deeper to deliver better application and solutions to them. However, based on the new technology development process, we believe the large language model would be a great turning point for the application in the business to consumers scenarios. We will further focus on the To C side. For example, like the previous product we've been mentioning about the OOTDiffusion is actually the technology name, not the product name itself. The OOTDiffusion is the algorithm we are going to introduce to our consumers. We will deliver a product based on the algorithm. Also the DIF we've previously talked about, the Daily Invest Focus, we're going to deliver it to the market very soon in May as well. Other than that, we also have the hardware that focusing on the ESG side. You know, our company's vision is always to improve everyone's life with AI technologies, so we wanted to deliver the hardware product that really solve the pain point and as well as the issues in the disabled or the underserved market demand. We're going to introduce this product very soon as well as in May. We were going to press release for this ESG products. We think we're going to constantly introduce new products in the To C side to explore the application and the market on that part. Here's a nutshell that for B side, we'll dig deeper into our customer base and to give them better customized better experience products based on large language model and the other related AI technologies. For the To C side, we are going to further explore into the consumers scenarios and also focus on the different you know underserved business segment or the mass consumption business segment. We will make sure that all of our products are entering into the right commercialization process. Here's the answer to your question. Thank you.

Barry Sha: [Foreign language] Anthony, thank you for your question. Here's a conclusion first. Your question is actually a very good one, because it's a very important question which customer we're going to focus on. First we wanted to answer that there's 2 dimensions. First one is actually business to business, and second one is actually business to consumers. Like you've been previously talk about, we have a very large customer base.

Speaker Change: Hello.

Speaker Change: So Anthony Thank you for your question Here's a conclusion first.

Anthony Chang: Your question is actually a very good one because.

Speaker Change: It's a very important question, which customer we're going to focus on so first we wanted to answer that there's two dimension first one its actually two business and second one is actually business to consumers.

Speaker Change: So like you've been purposely talk about we have a very large customer base a covered the industry from manufacturing to finance and.

Barry Sha: We covered the industry from manufacturing to finance and also to the couriers. Maybe all of these clients are within our customer base. Then for these customer bases, we're going to dig deeper into their customer needs, and we will rely on their business development process, their strategies to see whether or not they are strong enough to carry more AI technology applications. We will focus on their pain point to deliver customized large language models combined and integrated AI solutions.

Operator: Okay, thank you, President Yuan. From manufacturing to finance, and also to the couriers, maybe all of these clients are within our customer base. So for these customer bases, we're going to dig deeper into their customer needs, and we will rely on their business development process, their strategies, to see whether or not they are strong enough to carry more AI technology applications. And we will focus on their pain points to deliver customized, large-functional models combined and integrated AI solutions. So, for the business-to-business scenario, we will further rely on 1,000 delivery cases which we acquired within this 20 years, more than 20 years of journey in commercialization experience.

Speaker Change: So to the carriers, maybe all of these clients are R. R.

Speaker Change: Within our customer base.

Speaker Change: So.

Speaker Change: And then for these these customer bases, we're going to dig deeper into their customer needs and we will rely on their business development process their strategies to see whether or not there is strong enough to carry more AI technology applications, and we will focus on their pain point <unk>.

<unk> customized large function models combined and integrated solutions.

Barry Sha: For the business to business scenario, we will further rely on 1,000 delivery cases which we acquired within this more than 20 years journeys in its commercialization experience. We will further dig deeper to deliver better application and solutions to them. However, based on the new technology development process, we believe the large language model would be a great turning point for the application in the business to consumers scenarios. We will further focus on the To C side.

Speaker Change: So for the business to business scenario, we will.

Speaker Change: Further rely on 1000 delivery cases, which we acquired within this 20 years more than 20 years journeys and in commercialization.

Operator: And we will be further digging in to deliver better applications and solutions to them. However, based on the new technology development process, we believe the large-runge model would be a great turning point for the application in the business-to-consumer scenario. So we will further focus on the 2C side. For example, like the previous product we've been mentioning about the OOT diffusion, it's actually the technology name; it's not the product name itself.

Speaker Change: <unk> experienced.

And we will be further decline to deliver better applications and solutions to them. However, based on the new technology development.

Speaker Change: We believe the large chunks motto would be a great turning point for the application and the business to consumers scenarios.

Speaker Change: So we will further focus on on the Juicy site.

Barry Sha: For example, like the previous product we've been mentioning about the OOTDiffusion is actually the technology name, not the product name itself. The OOTDiffusion is the algorithm we are going to introduce to our consumers. We will deliver a product based on the algorithm. Also the DIF we've previously talked about, the Daily Invest Focus, we're going to deliver it to the market very soon in May as well. Other than that, we also have the hardware that focusing on the ESG side. You know, our company's vision is always to improve everyone's life with AI technologies, so we wanted to deliver the hardware product that really solve the pain point and as well as the issues in the disabled or the underserved market demand.

Speaker Change: For example, like the previous product would be mentioning about the O O T. Diffusion is actually the technology name is not in the program name itself.

Operator: The OOT distribution is the algorithm we're going to introduce to our consumers. We'll deliver a product based on their algorithm. And also the DEEF, we've been previous to talk about it, the daily and vast focus. We're going to deliver it to the market very soon in May as well. Other than that, we also have the hardware that's focusing on the ESG side. Our company's vision is always to improve everyone's lives with AI technologies.

Speaker Change: OTT fusion is.

Speaker Change: The algorithm, we're going to introduce tier consumers will deliver our products based on their algorithm and also the data that we've been privileged to talk about it at the daily Investor focus.

We're going to deliver to it I did to the market very soon and in May as well.

Speaker Change: Other than that we also have.

Speaker Change: The hardware or the focus on ESG side.

Speaker Change: Our Companys vision is always to improve everyone's lives with AI technologies. So we wanted to deliver hardware product that really solved.

Operator: So we wanted to deliver hardware products that really solve the pain points as well as the issues in the disabled or the under-deserved market demand. So we're going to introduce this product very soon, and in May, we were going to press out the lease for this ESG product. And we are going to constantly introduce new products at the 2C site to explore the application and the market on that part.

Speaker Change: The pain point, and as well as the issues and disabled or the.

Speaker Change: The under served markets demand.

Speaker Change: So we're going to.

Barry Sha: We're going to introduce this product very soon as well as in May. We were going to press release for this ESG products. We think we're going to constantly introduce new products in the To C side to explore the application and the market on that part. Here's a nutshell that for B side, we'll dig deeper into our customer base and to give them better customized better experience products based on large language model and the other related AI technologies. For the To C side, we are going to further explore into the consumers scenarios and also focus on the different you know underserved business segment or the mass consumption business segment. We will make sure that all of our products are entering into the right commercialization process. Here's the answer to your question. Thank you.

Speaker Change: Produced this.

Speaker Change: Very soon as well as in May we were going to press release.

Speaker Change: For our this ESG with.

Speaker Change: <unk> and.

Speaker Change: We think that we're going to be constantly introduce new products in the QC side to explore the application and the market on that part.

Speaker Change: So here's a nutshell debt.

Operator: So, here's a nutshell that for the B-Side, we'll be digging deeper into our customer base and giving them better customized, better experienced products based on the large-runch model and the other related AI technologies. And for the 2C-Side, we're going to further explore the consumer scenarios and focus on the different, you know, under-deserved business segment or the mass consumption business segment. We'll make sure that all of our products are entering into the right commercialization process. So, here's the answer to your question.

Speaker Change: And for besides well, we dig deeper into our customer base and to give them better customized.

Speaker Change: Better experience products based on large French model and the other related air technologies and for the Juicy side, we're going to further explore and to the consumers.

Speaker Change: Scenarios.

Speaker Change: And our focus on a different.

Speaker Change: Under deserved a business segment or.

Speaker Change: The the mask.

Speaker Change: Consumption business segment, we will make sure that all of all of our products are entering to the right customer commercialization process.

Speaker Change: So here's the answer to your question. Thank you.

Operator: Thank you. We'll now take the next question. This is from Isaac Chan from Han Grand Holding Group Limited. Please go ahead.

Operator: We'll now take the next question.

Speaker Change: Thank you.

Speaker Change: Well now take the next question.

Isaac Chan: This is from Isaac Chan from Han Grand Holdings Group Ltd. Please go ahead. Thank you for choosing my question. We have noticed that

Speaker Change: Got it.

Speaker Change: This is from Isaac Chan from Ham Grand Halls includes limited. Please go ahead.

Isaac Chan: Thank you for picking my question. We have noticed that your company has disclosed plans to initiate overseas expansion and expand into the consumer market. Could you provide information regarding the company's B2C strategy and overseas expansion strategy for this year? Thank you.

Isaac Chan: Thank you for taking my questions, we have noticed that.

Operator: Thank you, Isaac. Mr. Yuan, the question is that we also released a strategy for seagoing and B2C this year. What is our specific strategy in this area, or what is our specific strategy for expanding the market? Can you hear me, Mr. Yuan?

Isaac Chan: The company has disclosed plans to interstate overseas expansion that expense into the consumer market.

Isaac Chan: Could you provide information regarding the company's B to C strategy in overseas expansion strategy for this year. Thank you.

Barry Sha: Thank you, Isaac. 就是他的问题是说，我们今年也发布了这个出海和这个B2C的这个策略，那我们的具体的就是在这方面的一个战略，或者是扩张市场的一个策略具体是什么？好，就是大概是这样的一个问题。哎，听得到吗？

Barry Sha: Thank you, Isaac. [Foreign language]

Speaker Change: Thank you Isaac.

Max Yuan: First of all, we believe that a very important business strategy this year is that everything is based on large-scale business development. Based on this business development, we believe that, in addition to the traditional B2B market, we will continue to grow and maintain further steady growth. In addition, there are two very important strategies.

So you're unwilling to share his head of unusual woman Junior in your example, you were too high.

Speaker Change: Jacob.

Speaker Change: BGC there should look familiar.

Well you should ask Jeff I'm going to go try and deal closure, our quote ultrashort laser solution.

Speaker Change: Thank you gentlemen.

Speaker Change: Thank you Andrew.

Hui Yuan: 好，刚才静音了，不好意思。首先，我们认为今年非常重要的一个商业战略的话，就是一切是围绕着基于大模型的商业变现。那基于这个商业变现，我们认为除了传统的B2B市场的话，我们会继续深耕，保持进一步稳健增长。另外的话就是有两个非常关键的战略，一个就是出海，就是国际化市场，一个就是B2C，就是针对消费者市场，提供大量的持续这样的产品。那海外市场的话，实际上是从去年开始的话，我们在上市之后，我们就对全球市场有一个基本的调研，包括在中东市场，在东南亚市场，包括在欧美市场，我们会发现一个非常有趣的现象，实际上这个，现在越是全球发达的国家和地区，从AI和科技的应用层面来讲，我不知道大家的感受如何，实际上的话，中国从移动互联网开始的话，应用就已经基本上全球领先了。所以今天的话，我们在全球所有的发达国家和地区，我们会看到市场有非常强劲的需求，但实际上的话，从应用比如说供给层面，实际上是远远没有得到满足的。所以这个反而来讲，对我们来讲的话，是因为我们过去二十年的话，在整个大中华地区有非常成功的成熟的应用案例，我们非常有信心能够快速地把这些案例和应用能够推向全球市场。所以关于全球市场布局的话，实际上我们已经在中东，在美国我们都已经完成了公司结构性的变化和布局。所以接下来的话，我们会陆续地快速地把成熟的产品，包括一些创新的产品能够推向国际化市场。所以这是第一个在国际化战略，就是公司的结构已经完成了整个全球化或者是重点国家和地区的战略布局，那剩下的话实际上是在接下来下半年的话，大家会看到很多直接面向海外市场的2C、2B的产品都会陆续进行呈现，这是第一个。第二个的话，消费者产品的话，实际上是我们在前面也谈到过，消费者产品也是今天大模型能力展现的一个非常重要的一点，也是AI如何能够真正爆发的一个非常重要的方向。所以包括我们谈到的说基于OOTDiffusion这样一个技术，我们很快就会上线新的针对消费者的应用产品，包括像我们基于过去大模型，包括基于RPA，包括基于深度学习这样一种技术的平台，像DIF，我们会直接针对这些投资者会有一些非常深刻的市场分析和市场洞察，以提供给他们参考。当然在我们今年下半年的话，我们实际上是有一个非常清晰的，而且是完整的pipeline。我们希望说能够在非常短的时间的话，不断地有新的产品能够陆续地投放市场。因为对小i来讲的话，我们不是一个应用的公司，我们是一个拥有完整的核心的大模型基础能力的一家公司。而大模型本身来讲，最重要一点就是能够完成一个生态，一个应用生态。那在这个应用生态构建的初期，实际上就会有不断地有一些创新产品，会基于这个平台不断进行投放。所以我相信说我们自己本身，包括跟生态合作伙伴一起的话，都会在下半年会有大量的产品，都会陆续上线。这就是我们讲说国际化和C端市场是我们今年非常重要的AI大模型变现的两个重要的战略布局。

Max Yuan: [Foreign language]

Speaker Change: Okay.

Speaker Change: That team of value.

Max Yuan: One is the internationalization of the overseas market, and the other is the B2C market, which provides a large number of sustainable products for consumers. Since last year, we have conducted basic research on the global market, including the Middle East, Southeast Asia, and European and American markets. We found a very interesting phenomenon.

So again I think a woman religion.

Speaker Change: Yeah.

Speaker Change: So he is a good sound your departure.

Speaker Change: Yes.

Speaker Change: Donaldson is a good foundation.

Speaker Change: Now, it's easy to go well.

Speaker Change: Sure.

Speaker Change: As it goes hand on that to go to <unk> I guess, just on volume where tissue with you guys.

Speaker Change: <unk>, you might have pockets, where youll geography, Guan Jia Zhang salary.

Speaker Change: Are you going to adjust.

Speaker Change: Hi, Jessica would you have to go through how you guys are supposed to go to <unk>.

Max Yuan: In fact, the more developed countries and regions there are, from the application level of AI and technology, I don't know how you feel. In fact, since the beginning of China's mobile Internet, applications have basically taken the lead globally. So today, we see a very strong demand in all developed countries and regions. But, in fact, from the application level of supply, it is far from being satisfied.

Jessica: So I wanted to start on that.

Jessica: Sure Doug with Henry <unk>.

Jessica: Hi, This is on a classic answer John.

Speaker Change: It sounds like the whole.

Speaker Change: Women Jody Jennie O to that and how you go to Cuba and the dynamic gallium.

Doug: Hey, guys, Hey, guys, who knows right now got it.

Doug: But with that as well.

Doug: It should as agriculture.

Speaker Change: So you guys are good.

Speaker Change: Yes, sure Youll find adequate Yahoo tissue Jones.

Could you discuss.

Speaker Change: What was that the other countries.

Speaker Change: So you've done a lot and congrats on growth.

Speaker Change: I'm passionate about.

Speaker Change: Good evening.

Speaker Change: As you can get at home <unk>.

Max Yuan: So for us, in the past 20 years, there have been very successful and mature applications in the entire Greater China region. We are very confident that we can quickly push these cases and applications to the global market. Regarding the global market layout, in fact, we have already completed a structural change in the Middle East and the United States. Therefore, in the future, we will rapidly introduce mature products, including innovative products, to the international market.

Speaker Change: Ill jump.

Speaker Change: Jumping into the future.

Speaker Change: I can hear you.

Speaker Change: So maybe if you guys have me Jonathan can you hear me okay.

Speaker Change: Good luck.

Yes.

Hi, guys.

Speaker Change: How do you view your pay down some debt.

Speaker Change: Okay got you. Thank you Andy.

Speaker Change: Well, then, let's say, how youre thinking about price with the button here.

Jonathan: Hey, Jonathan.

Jonathan: Hey, Brian.

Speaker Change: He's our meeting.

Speaker Change: Got it.

Speaker Change: It May go integrate to go one thing of course is that you guys are you going to think it would be a while ago.

Max Yuan: So, this is the first international strategy. The company's structure has been completed globally, or the strategic layout of key countries and regions. As for the rest, in the second half of the year, you will see a lot of products directly for the overseas market, such as 2C, 2B, will be presented one after another. This is the first one.

Speaker Change: We're little shoot a quite a food about tenants that you guys have been above where you thought you might have your negotiation on deal could you walk us through that.

Speaker Change: Do you guys like what you have to consolidate.

Speaker Change: So thats a good for new Hot weather has its own game codelco tissue, Johnny if would you now centralized absolutely yes.

Johnny: Yes, yes, I think the challenge that we're kind of in.

Johnny: Could you give me highlights Zahedan Juicy <unk> do you think that you can integrate to go see the league Thiago Hi, Hugo Chavez Jonathan.

Max Yuan: As for the second one, consumer products, as we mentioned earlier, consumer products are a very important point in the ability of big models today. They are also a very important direction in how AI can really explode. So, as we mentioned, based on OOTD technology, we will soon launch new products for consumer applications, such as our past big models, RPA, and deep learning technology platforms, like Antifreeze. We will provide these investors with some very deep market analysis and market observations for their reference.

Johnny: The woman that Jamie and our chairman Mr.

Johnny: Tom what you integrate <unk> hygiene Eagle fleet hung out at <unk>.

Johnny: Yes.

Johnny: <unk> thinking about how do you go from here.

Johnny: All of them in another words, you O T design. Good she is a woman I'm glad you're here. It sounds you kinda fill and finish up at this time.

Power's element to you of course, you download Zimbabwe.

But what's your sense is that you're doing with <unk>.

Speaker Change: Well Im pleased with yesterday's as you had positive way always here for you.

So I'm good. Thank you Susanna thank you because I'm not sure how you're doing it.

Max Yuan: Of course, in the second half of this year, we have a very clear and complete pipeline. We hope that in a very short time, there will be new products that can be put into the market one after another. Because for Xiao-I, we are not an application company.

Speaker Change: Darrin Delavan, because union, Kevin Yeah to go one month's ICR you.

Speaker Change: Hey, Tom changed either RJ, So London Dano pipeline once you answer and then those that pay down does it go through again.

Speaker Change: As you know don't have been number Lucia Tabasco Sudan.

Speaker Change: Okay.

Max Yuan: We are a company that has a complete core and large-scale infrastructure capability. The most important thing for a big model is to complete an ecosystem, an application-based ecosystem. At the beginning of the application-based ecosystem construction, some innovative products will continue to be launched based on this platform. So I believe that we ourselves, including our ecosystem partners, will have a large number of products in the second half of the year, and they will be launched one after another. This is what we mean by internationalization and the C-market. This is a very important strategic step for our AI big model transformation this year.

Speaker Change: Bush of Unicorn once the Yugo yoyo, one hand washing the Donaldson Chief William Li Doug.

Speaker Change: Our downloading but number.

Speaker Change: The number one thing you guys intact.

Speaker Change: Jonathan.

Speaker Change: And somehow Gordian is good fortyish yanzhou put under the I was just talking to because how do you. What do you think of that but we wanted to get a gene Tovah Haynesville woman Siggi Benson Bob Robinson.

Speaker Change: Nice job on.

Speaker Change: Got it I understand the way it looks like you thought you could get all of them Yahoo, or do you have with these answers are sure Virginia filling out that you've got.

Speaker Change: Tom would you envision that Hugo.

Speaker Change: But when we look at salary would you.

Barry Sha: All right. Thank you, Mr. Yuan. Thank you, Isaac for your question. We wanted to answer your question one by one. First of all, I said regarding to the overseas business expansion strategy, that first of all, our topic today is always centered with the commercialization. We based on the B2B market, we will still dig deeper to make sure that we have a robust and a steady growth upon our original customer base. But for the overseas one is, and is that, we've already adjusted our strategies. We've been conduct a lot of market analysis and research upon the global AI tech AI application scenarios, including the MENA area, Southeast Asia, as well as the United States and Europe. There's a very interesting phenomenon that the one that we are more developed in R&D standard R&D level or R&D performance that the AI application is however not so satisfying. There is a blank area between the technology and the actual application. We think our company is actually quite good to deliver. We are quite experienced, so we are going to bring more mature and better experience product to the overseas market. Our corporate structure has adjusted accordingly for our overseas expansion. In H2 of this year, we were going to see more and more product we were going to bring to the overseas market to further enhance and expand our product matrix and product lines. The second point is about the consumer side. For this year, we're thinking the AI capabilities is now is at a specific time point that can enable this consumer side product to be more satisfying and better experienced. Based on the more applications, based on the our LLM technology framework as well as the RPAs and also deep learning, all of these technologies, we're going to utilize those and to deliver better product to our consumers. Regarding to the product we've been introduced previously, it's like Deep and OOTDs, that will be the first two application we introduced to the market, and then there will be more. In a nutshell, the B2C and international expansion that we are we've been firmly believe that we will leverage on the robust capabilities of the AI technologies, and we will witness a significant expansion in B2C market as well as the consumer market. Especially we wanted to further you know highlight on the angle of the company that is really deliver the product of the AI for good. Our mission is to ensure that AI technology is not only a transformative but also inclusive to really creating the solutions, not just technologically advanced, but also empathetic and accessible. By doing so, we aim to make a real difference in people's lives, bringing AI technologies to those who need it the most, and improving their quality of life across the board globally, from B2B to B2C. Yeah, that is our strategies and answers to your questions. Thank you.

Barry Sha: [Foreign language] Thank you, Isaac for your question. We wanted to answer your question one by one. First of all, I said regarding to the overseas business expansion strategy, that first of all, our topic today is always centered with the commercialization. We based on the B2B market, we will still dig deeper to make sure that we have a robust and a steady growth upon our original customer base. But for the overseas one is, and is that, we've already adjusted our strategies. We've been conduct a lot of market analysis and research upon the global AI tech AI application scenarios, including the MENA area, Southeast Asia, as well as the United States and Europe.

Speaker Change: Okay.

Speaker Change: That's correct.

Tom Harrington: Sure. Thank you.

Speaker Change #100: Thanks for your question. So first of all when we wanted to answer your question number one first of all I said.

Operator: Thank you, Isaac, for your question. So first of all, when we wanted to answer your question one by one, first of all, I said, regarding the overseas business expansion strategy, that first of all, our topic today is always centered on commercialization. So based on the B2B market, we will still dig deeper to make sure that we have a robust and steady growth on our original customer base. But for the overseas one, we've already just got our strategies.

Speaker Change #100: Regarding to the overseas business expansion strategy.

Speaker Change #100: That's first of all we.

Speaker Change #100: Our topic today is always centered with the commercialization.

Speaker Change #100: So we but based on the <unk> market, we will be still dig deeper to make sure that we have a robust and steady growth upon our original customer base.

Speaker Change #100: For the oversea wine is.

Speaker Change #100: Yes.

Speaker Change #100: It is that we've already.

Operator: We've been conducting a lot of market analysis and research on the global AI application scenarios, including the MENA area, Southeast Asia, as well as the United States and Europe. There is a very interesting phenomenon that the one that we are more developed in R&D standards, R&D level, or R&D performance, the AI application is, however, not so satisfying. So there is a blank area between the technology and the actual application.

Speaker Change #100: Just our strategies, we've been conducting a lot of market analysis and research upon the global.

Speaker Change #100: Hi.

Speaker Change #100: <unk> application scenarios, including the Mena area Southeast Asia as well as <unk>.

Barry Sha: There's a very interesting phenomenon that the one that we are more developed in R&D standard R&D level or R&D performance that the AI application is however not so satisfying. There is a blank area between the technology and the actual application. We think our company is actually quite good to deliver. We are quite experienced, so we are going to bring more mature and better experience product to the overseas market. Our corporate structure has adjusted accordingly for our overseas expansion.

Speaker Change #100: As states and Europe, there is a very interesting phenomenon.

Speaker Change #100: That did.

Speaker Change #100: The one that we are more developed and R&D.

Speaker Change #100: Standard R&D level or R&D performance.

Speaker Change #100: Doug.

Speaker Change #100: The application is however, not.

Speaker Change #100: So satisfying so there is a.

Speaker Change #100: Blank area between the technology and the actual application. So we think our company is actually quite good to deliver it.

Operator: So we think our company is actually quite good at delivery. We are quite experienced. So we're going to bring more mature and better-experienced products to the overseas market. Therefore, our corporate structure has been adjusted accordingly for our overseas expansion. So at the end of this, in the second half of this year, we're going to see more and more products we're going to bring to the overseas market to further enhance and expand our product matrix and product line. So the second point is about the consumer side.

Speaker Change #100: We're quite experienced so we're going to pray more mature and better experience product to the oversea market.

Speaker Change #100: So our corporate structure has adjusted accordingly.

Barry Sha: In H2 of this year, we were going to see more and more product we were going to bring to the overseas market to further enhance and expand our product matrix and product lines. The second point is about the consumer side. For this year, we're thinking the AI capabilities is now is at a specific time point that can enable this consumer side product to be more satisfying and better experienced. Based on the more applications, based on the our LLM technology framework as well as the RPAs and also deep learning, all of these technologies, we're going to utilize those and to deliver better product to our consumers. Regarding to the product we've been introduced previously, it's like Deep and OOTDs, that will be the first two application we introduced to the market, and then there will be more.

Speaker Change #100: For our oversea expansions.

Speaker Change #100: At the end of this and the second half of this year.

Speaker Change #100: We're going to see more and more product, we're going to brain to oversea market to further.

Speaker Change #100: And.

Speaker Change #100: Further enhance and expand our product matrix M product lines.

Speaker Change #100: The second point is about the consumer side.

Operator: This year, we think the AI capabilities are now at a specific time point that can enable these consumer-side products to be more satisfying and provide a better experience. So based on more applications, based on the LLM technology framework, as well as RPAs and also deep learning, all of these technologies, we're going to utilize those and deliver a better product to our consumers. So regarding the product we've been introduced to previously, it's like a deep and OOTDs. That will be the first two applications we introduce to the market, and then there will be more.

Speaker Change #100: For this year everything can be AI capabilities is now is avid specific time point that can enable this consumer side product to be more satisfying and better experienced so based on any more applications.

Speaker Change #100: Based on it.

Speaker Change #100: L M technology framework as well as the Rps and also deep learning all of these technologies, we're going to utilize and to deliver better products to European insurers.

Speaker Change #100:

Speaker Change #100: So regarding to the credit we've been introduced previously is that God ive in OTT.

Speaker Change #100: It would be.

Speaker Change #100: They did the first two application we introduced to market and then there will be more.

Barry Sha: In a nutshell, the B2C and international expansion that we are we've been firmly believe that we will leverage on the robust capabilities of the AI technologies, and we will witness a significant expansion in B2C market as well as the consumer market. Especially we wanted to further you know highlight on the angle of the company that is really deliver the product of the AI for good. Our mission is to ensure that AI technology is not only a transformative but also inclusive to really creating the solutions, not just technologically advanced, but also empathetic and accessible. By doing so, we aim to make a real difference in people's lives, bringing AI technologies to those who need it the most, and improving their quality of life across the board globally, from B2B to B2C. Yeah, that is our strategies and answers to your questions. Thank you.

Operator: So in a nutshell, the B2C and international expansion that we are undertaking, we've firmly believed that we will leverage the robust capabilities of AI technologies and we will witness a significant expansion in the B2C market as well as the consumer market. Especially, we wanted to further highlight the angle of the company that has really delivered a product of AI for good. So our mission is to ensure that AI technology is not only transformative but also inclusive to real creating solutions that are not just technologically advanced but also empathetic and accessible.

Speaker Change #100: So.

In a nutshell, the BTC and international expansion expansion that we are.

We've been from the.

Speaker Change #100: Believe that we will leverage on the robust capabilities of AI technologies, and we will witness a significant expansion and BGC market as well as the consumer market.

Speaker Change #100: Especially we wanted to further.

Speaker Change #100: No.

Speaker Change #100: Highlights on the angle of the company.

Speaker Change #100: We delivered a product of the AI for good so.

Our mission is to ensure the AI technologies, not only a transformative but also inclusive.

Speaker Change #100: And two to two real creating dispositions not just technologically advanced but also in past and empathetic and accessible.

Operator: So by doing so, we aim to make a real difference in people's lives, bringing AI technologies to those who need them the most and improving their quality of life across the board globally, from B2B to B2C. So yeah, that is our strategy and answers to your questions. Thank you.

Speaker Change #100: So by doing so we aim to make a real difference in People's lives, bringing AI technologies to those who need need it the most and improving their quality of life across the board globally from.

Speaker Change #100: From BBB to BGC. So, yes that is our strategy and answers to your questions. Thank you.

Operator: Thank you. We will now take our next question. This is from Zheng Yang from BE Investment. Please go ahead.

Speaker Change #101: Thank you.

Zheng Yang: We will now take our next question. This is from Zheng Yang from BE Investment. Please go ahead.

Speaker Change #102: We will now take our next question.

Speaker Change #102: This is from Siang Yang from <unk> investments. Please go ahead.

Operator: Thank you, Teresa. Maybe this question goes back to Callie. Callie, Teresa is asking about the company's R&D. What is the level of R&D? At the same time, do we have a chance to see the possibility of profit? This is the question about profit.

Zheng Yang: Hi. First, thanks for your presentation. I have some question regarding R&D investment. As we know, the R&D is very important for the high tech company like 小i. Well, I'm just curious about how much is your R&D investment, and after the investment, when are you expect to turn the profit?

Hi, first of thanks for your presentation and I have some question regarding R&D investments.

Siang Yang: So as we know the IMD is very important for the high Tech company like Shanghai, Oh, well I'm just curious about how much is your R&D investment and after the investment one or you expect to turn the prophage.

Callie Wong: Thank you for the question. First of all, in terms of R&D investment, we expect that in 2024, R&D investment will also maintain a 50% income level. Because we still need to maintain our basic sustainability advantage. The main direction of R&D investment of the company is mass production and large-scale models. But of course, we will also take commercialization as a precondition and consider the cost-effectiveness and ROI. In terms of profit, first of all, we will consider these directions.

Barry Sha: Well, in the meantime, would there be the liquidity gap? Thanks. Thank you, Theresa. Maybe this question goes out to Kelly.

Barry Sha: Well, in the meantime, would there be the liquidity gap? Thanks.

Siang Yang: In the meantime, there have the liquid gap.

Siang Yang: Thanks.

Barry Sha: Thank you, Theresa. Maybe this question goes out to Kelly. [Foreign Language]

Speaker Change #104: Thank you Theresa.

Speaker Change #105: My question goes back to Kelly.

Kelly Weng: 好，谢谢提问。首先在研发投入上，我们在2024年预计研发投入也会维持在收入50%这样一个水平，因为我们还是需要以保持我们这样的一个技术领先性的优势。然后公司的研发投入的主要方向还是为这个MaaS产品和华藏大模型。但是当然我们也会以商业化为前提，会考虑这个性价比和ROI这样一方面的考虑。对于盈利上，首先是分这样几个方向去考虑。首先在这个收入上面，我们2023年大多数的收入都是来自于To B以及在中国的，那么在2024年这一块的收入，我们预期也会有一个20%左右的稳健增长。同时呢，我们也在积极发展这个海外业务，那么在2024年我们也希望预期可以带来一些增量业务。在这个一些运营开支的营运费用上面，2023年我们的销售费用、管理费用这些的费率已经降至了15%。那随着我们收入规模的进一步增长呢，我们预期2024年的运营效率将进一步得到改善。基于上述几个因素，我们预期2024年可能有实现……

Kelly Weng: [Foreign language]

Speaker Change #105: Thanks.

Speaker Change #105: Terry.

Speaker Change #105: Consider that.

Speaker Change #105: That's helpful.

Speaker Change #105: Yes.

Speaker Change #105: Question from analysts.

Speaker Change #105: Sure.

Speaker Change #105: Joseph.

Speaker Change #105: Thank you.

Speaker Change #105: Thank you Jim.

Speaker Change #106: Okay. Thank you Marcia Johnson.

Speaker Change #106: Policies, EQM Trojans and Johan <unk>.

Speaker Change #106: On the <unk> relationship I sure. Thank you John.

Callie Wong: First of all, in terms of income, in 2023, most of the income will come from QB and China. In 2024, we expect that this income will also have about 20% software growth. At the same time, we are also actively developing this overseas business. In 2024, we also hope that we can bring some increased business. In 2023, sales and management expenses dropped by 15%.

Speaker Change #106: <unk> you may want hydrogel offshore Magellan Keith with smoking.

Speaker Change #107: Oh, sorry Jaco.

Rob: I'll, let Rob answer.

Rob: How should weighted most chunky coupons on time wishing that should turn around with me away from your Huawei Chinchy with Harley Davidson.

Rob: Our <unk> formula.

Speaker Change #109: Thank you Lisa Wilson Jones.

Rob: Sure.

Rob: So it seems like you guys saw some young woman Sonya. So it looks like you to be you got to that number our opinion kind of show me here will you go about central office with our gypsum.

Callie Wong: As our income scale increases, we expect that the operating efficiency in 2024 will improve further. Based on the above factors, we expect that in 2024 there may be a chance to achieve a large reduction in tariffs and even a chance to make profits. Then, we will continue to use our long-term technical strength to combine market demand to realize the commercialization of the technology. At the same time, we will continue to launch new products, expand product lines, and improve product governance. We will also build a sustainable business growth curve. We will also strive to improve efficiency, profitability, and enhance our profitability. In this way, we look forward to returning to our shareholders better profitability results. Thank you.

Rob: Who shall now with rocky for them to go no matter. How you ask me I won't you won't see creep out of here.

Rob: Higgins, how do you feel from you.

Rob: Some young women as social for you why do you feel do you see the fee it influence on the issue.

Speaker Change #110: I'm not sure whether I can go with simple enough for me.

Speaker Change #112: Thank you Chuck.

Speaker Change #112: He yourself would ensue when he on Australian Kenosha here.

Kelly Weng: 可能有机会实现大幅度地减少亏损，甚至有机会实现盈利。我们也将继续利用这个长期积累的技术实力，结合这个市场需求，实现技术的商业化转换。同时通过不断地推出新产品，扩大产品线，完善产品矩阵，我们也将打造一条可持续的业务增长曲线。我们也将致力于提升效率、运营效率，以及增强我们的盈利能力。这样也期待用更优异的经营成果来回报我们的股东。谢谢。

Kelly Weng: [Foreign language]

Speaker Change #113: He would give us a hint, possibly like Ehow. Please send your questions Yang Mi.

Speaker Change #111: Oh no.

Speaker Change #111: Guarantee she onto the chunky heated up.

Speaker Change #111: He will answer your question.

Speaker Change #111: C C.

Speaker Change #111: So you can see is with US on your question on what coaches, who book, we're going to switch, we're seeing hunting, Quebec, Tony here Lastly, I'm talking teacher will may jump.

Speaker Change #111: Sure.

Speaker Change #111: It's actually <unk>, some means sun and GE.

Speaker Change #111: Now, we're making any money.

Speaker Change #111: He thought it was going you either in terms of luck with all of them.

Barry Sha: Thank you, Kelly 总. So, Theresa, here's the answer to your question. First of all, we will be, you know, utilizing on our a large customer base, then we will anticipate a continued growth estimation upon the To B side. However, our revenue from this segment has been robust, and we expect it to sustain a solid growth again on next year is around 20%. So this projection will reflect on our confidence and strength, our current business operation and the potential of the Chinese market. And also that is not only for the To B side. Like the To B, To C side, we've been previously talked about there will be more product introduced to the market.

Barry Sha: [Foreign language] So, Theresa, here's the answer to your question. First of all, we will be, you know, utilizing on our a large customer base, then we will anticipate a continued growth estimation upon the To B side. However, our revenue from this segment has been robust, and we expect it to sustain a solid growth again on next year is around 20%. So this projection will reflect on our confidence and strength, our current business operation and the potential of the Chinese market. And also that is not only for the To B side. Like the To B, To C side, we've been previously talked about there will be more product introduced to the market.

Speaker Change #111: So.

Speaker Change #111: Should you carry them.

Speaker Change #114: So Theresa here's the answer to your question first of all.

Operator: Teresa, here's the answer to your question. First of all, we will be, you know, utilizing our large customer base that we will anticipate a continued growth estimation for the GB However, our revenue from this segment has been robust, and we expect it to sustain a solid growth again on a year-on-year basis, around 20%. So this projection will reflect our confidence in the strength of our current business operation and the potential of the Chinese market. And also, that is not only for the 2B side.

Speaker Change #111: We will be.

Speaker Change #111: Utilizing honor.

Speaker Change #111: And our customer base.

Speaker Change #111: Well, we will be continue anticipate a continued growth.

Speaker Change #111: And estimation upon that you'd be site.

Speaker Change #111: However, our revenue from.

Speaker Change #111: This segment has been robust and we expect it to sustain a solid growth again.

Speaker Change #111: Next year's basis.

Speaker Change #111: Around 20%. So this projection, but will reflect on our confidence and strength of our current business operation and the potential of the Chinese market.

Speaker Change #111:

Speaker Change #111: And also that that is not only for the GP side like it to be at Juicy side, we've been purposely talk about there will be more products introduced to the market.

Operator: Like the 2C side we've been talking about, there will be more products introduced to the market. We're utilizing this wolfpack strategy to introduce one application, then another. There will be a lot of applications going to be introduced to the market. Additionally, there will be anticipated incremental revenue generated from the 2C side as well. So in terms of the R&D investment that you previously asked about, currently speaking, there's around a 50% estimation; 50% of our revenue will be going into the investment of our R&D.

Barry Sha: We're utilizing this wolf pack strategy, you know, to introduce one application then another. There will be a lot of applications going to be introduced to the market. There will be anticipated incremental revenues generated from the B2C side as well. In terms of the R&D investment you've been previously asked about, currently speaking, there's around 50% estimation. 50% of our revenue will go into the investment of our R&D. It's going to remain at a significant level, but it's going to be lesser in terms of the ratio of the R&D compared to last year. Our primary focus on R&D investment will still be in two areas.

Speaker Change #111: Utilizing this wolf pack strategy to introduce one.

Speaker Change #111: One application then another there will be a lot of application going to be introduced in market and there'll be anticipate a revenue grow ink from incremental revenues will be generated from <unk> side as well.

Speaker Change #111: So in terms of the R&D investment, especially asking about a.

Speaker Change #111: Current speaking there is around 50% activation, 50% of our revenue where that goes into the investment of our R&D is going to be remain at a significant level, but are going to be lesser in terms in terms of the ratio.

Operator: It's going to remain at a significant level but will be less in terms of the ratio of the R&D fees compared to last year. So our primary focus on R&D investment will still be on two areas. One, the model as a service product and the development of Hwazang LLM.

Speaker Change #111: All of the R&D.

Speaker Change #111: R&D fees compared to last year.

Speaker Change #111: So our primary focus on R&D investment will be still in two areas one mass tomorrow at the service products and the development of Barbell LLM. So these initiatives are the forefront of our technology offerings and are crucial for maintaining our competitive batch in an industry.

Barry Sha: One, MaaS, the model as a service product, and the development of Hua Zang LLM. These initiatives are the forefront of our technology offerings and are crucial for maintaining our competitive edge in AI industry, as well as for the projection and also estimation for the profitabilities. First of all, the revenue scale, like we've been previously talked about, there's going to be a 20% of revenue growth from B2B side and also domestic market side. There will be actual additional upside from our B2C side as well as the overseas market. As well, as for the operation expenses, in 2023, our SG&A expense rate was already been reduced to 15%.

Operator: So these initiatives are at the forefront of our technology offerings and are crucial for maintaining our competitive edge in the AI industry. And as well as for the projection and estimation for the profitabilities, first of all, the revenue scale, like we've been talking about, there's going to be a 20% revenue growth from the B2B side and also the domestic market. But there will be extra additional upside from the R2C side as well as the overseas market.

Speaker Change #111: As well as for <unk>.

Speaker Change #111: Our projection and therefore estimation for the productivity out of the profitability.

Speaker Change #111: First of all the revenue scale like we have been previously talk about there's going to be a 20% of revenue growth.

Speaker Change #111: <unk> site and also domestic market side, but there will be extra additional upside from RTC side as well.

Speaker Change #111: So if the oversea market.

Operator: As well as for the operation expenses, in 2023, our SG&A expense rate was already being reduced to 15%. So with the expansion of our revenue scale, we expect operational efficiency will be further continued. And there might be a further improvement in 2024 as well. And for the R&D investment, as we previously talked about, there will still be around 50% of the revenue going into research and development to maintain the technological edge.

Speaker Change #111: As well as for the operation.

Speaker Change #111: Panthers interested in 'twenty three our SG&A expense rate was already being reduced to 15%. So with the expansion of our revenue scale. We expect the operational efficiency will be further continue.

Barry Sha: With the expansion of our revenue scale, we expect the operational efficiency will be further continue. There might be an improvement, further improvement in 2024 as well. For the R&D investment, we still, like we've been previously talk about, there will be around 50% of the revenue goes into research and development to maintain technological edge. Based on that, we anticipate the company could significantly reduce losses in 2024 and may even turn a profit. In terms of cash flow, with the increased revenue and optimized cost, we expect operating cash flow to become positive. We will continue to leverage on our long-term technological accumulation aligned with the market demand to commercialize our technology.

Speaker Change #111: And there might be a preferred.

Speaker Change #111: Further improvement interested in 'twenty four as well.

Speaker Change #111: For the R&D investment.

Speaker Change #111: We still actually we prefer to talk about there will be around 50% of your revenue goes into research and development to maintain technological ACH so based on that.

Operator: So based on that, we anticipate the company could significantly reduce losses in 2024 and may even turn a profit. So in terms of cash flow, with the increased revenue and optimized cost, we expect operating cash flow to become positive. So we will continue to leverage our long-term technological accumulation aligned with market demand to commercialize our technology. By continuously launching new products, expanding our product lines, and perfecting our product matrix, we aim to create a sustainable growth curve for our business.

Speaker Change #111: Anticipate the company could significantly reduce losses interest in 'twenty, four and May even turn a profit.

Speaker Change #111: So interest in terms of the cash flow, we with the increased revenue and optimized cost we expect operating cash flow to become positive.

Speaker Change #111: And so we will continue to leverage on our long term technological accumulation align with the market demand to commercialize our technology by continuous continuously launching new products, expanding our product lines and perfecting our credit matrix, we aimed to create a sustainable growth curve for our business.

Barry Sha: By continuously launching new products, expanding our product lines, and perfecting our product matrix, we aim to create a sustainable growth curve for our business. In a nutshell, our financial forecast and strategic plans reflects our commitment to a balanced approach, sustaining our core business while pursuing new business opportunities, and investing in innovation with a keen focus on our commercial viabilities. We believe that this strategy will enable us to continue our growth journey, to deliver value to our stakeholders, and to make a positive impact in the field of AI technologies. Thank you for your question.

Operator: In a nutshell, our financial forecast and strategic plans reflect our commitment to a balanced approach, sustaining our core business while pursuing new business opportunities and investing in innovation with a keen focus on our commercial viability. Therefore, we believe that this strategy will enable us to continue our growth journey, deliver value to our stakeholders, and make a positive impact in the field of AI technology. Thank you for your question.

Speaker Change #111: In industrial our financial forecast and strategic plans reflect our commitment to a balanced approach sustaining our core business.

Speaker Change #111: While pursuing new business opportunities and investing in innovation with a keen focus on our commercial viability. So we believe that this strategy will enable us to continue our growth journey to deliver value to our stakeholders and to make a positive impact.

Speaker Change #111: You would have add technologies. Thank you for your question.

Operator: Thank you. Seeing no more questions in the queue, let me turn the call back to Mr. Yuan for closing remarks.

Operator: Seeing no more questions in the queue, let me turn the call back to Mr Yuan for closing remarks.

Speaker Change #117: Thank you.

Mr. Yuan: Seeing no more questions in the queue, let me turn the call back to Mr. Yuan for closing remarks.

Max Yuan: Thank you, operator, and thank you all for participating in today's call and for your support.

Hui Yuan: Thank you, operator. Thank you all for participating on today's call and for your support.

Max Yuan: Thank you, operator. Thank you all for participating on today's call and for your support.

Yuan: Thank you operator.

Yuan: Thank you all for participating on today's call under four years ago.

Operator: Thank you all again. This concludes the call. You may now disconnect.

Mr. Yuan: Thank you all again this concludes the call you may now disconnect.

Yuan: Okay.

Yuan: [music].

Yuan: Yeah.

Yuan: Okay.

Yuan: [music].

Yuan: Yes.

Yuan: [music].

Full Year 2023 Xiao-I Corp Earnings Call

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