Q1 2024 Xunlei Limited Earnings Call
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Operator: Welcome, ladies and gentlemen, and thank you for your patience. You've joined Xunlei's first quarter 2024 earnings conference call. At this time, all participants are in a listen-only mode. Please be advised that today's conference is being recorded. I'd now like to turn the call over to the host, Investor Relations Manager, Ms. Luhan Tang.
Speaker Change: Welcome Ladies and gentlemen, thank you for your patience is joy she lifes first quarter 'twenty 'twenty four earnings conference call. At this time, all participants are in a listen only mode.
Speaker Change: The adviser today's conference is being recorded.
Speaker Change: I'd like to turn the call over to the host Investor Relations manager Mr. Luo Han Guo.
Luhan Tang: Good morning, everyone, and thank you for joining Xunlei's Q1 2024 earnings conference. With me today are Eric Zhou, CFO, and Li Li, VP of Finance. Our IR website has our earliest press release available to supplement our prepared remarks during the call.
Speaker Change: Good morning, everyone and thank you for joining <unk> Q1, 'twenty 'twenty earnings Conference call with me today are Eric Zhou CFO and EVP of finance.
Speaker Change: Our our website has our earnings press release available to supplement our prepared remarks during the call.
Luhan Tang: Today's agenda includes a prepared opening remark from Chairman and CEO, Mr. Tim Bulli on Q1 operations highlights, followed by CFO, Mr. Eric Zhou, presenting financial results in detail and the revenue guidance for Q2 2024 before we open up the floor to your questions in the Q&A session. Please note that this call is recorded and can be replayed on our Investor Relations website at ir.xunlei.com. Before we get started, I would like to take this opportunity to remind you that the discussion today will contain certain forwarding statements made under the safe harbor provisions of the U.S. The Private Securities Litigation Reform Act of 1995.
Speaker Change: Today's agenda includes a deterrent opening remarks, I'm, chairman and CEO, Mr. Kimberly on Q1 operation highlights.
Speaker Change: I hope our CFO, Mr. Eric Zhou.
Speaker Change: <unk> financial results detail on your revenue guidance, what you choose for 24 before we open up the floor to your questions in a Q&A session.
Speaker Change: Please note that these costs are reported and can be replayed on our investor relations website at IR <unk> com.
Luhan Tang: Such statements are based on management's current expectations under current market conditions that are subject to risks and uncertainties that are difficult to predict, which may cause actual results to differ materially from those made in the forward-looking statements. Please refer to our SEC filings for more detailed descriptions of the risk factors that may affect our results. Xunlei undertakes no obligation to update any forward-looking statements except as required under applicable laws.
Speaker Change: It's always get started I would like to take this opportunity to remind you that the discussion today will contain certain forward looking statements made under the safe Harbor provisions of the U S. Private Securities Litigation Reform Act of 1995.
Speaker Change: Such statements are based on management's current expectations under current market conditions.
Speaker Change: Subject to risks and uncertainties that are difficult to predict which may cause actual results to differ materially from those made in the forward looking statements. Please refer to our SEC filings for more detailed description of the risk factors that affect our results.
Speaker Change: She might assume no obligations to update any forward looking statements, except as required under applicable law.
Luhan Tang: On this call, we will be using both GAAP and non-GAAP financial measures. A reconciliation of non-GAAP and comparable GAAP measures can be found in our earliest press release. Please note that all numbers are in U.S. dollars unless otherwise stated. Now, the following is the prepared statement by Mr. Jim Woo Lee, Chairman and CEO of Xunlei Ltd. Good morning and good evening, everyone. Thank you all for joining us today.
Speaker Change: On this call, we'll be using both GAAP and non-GAAP financial measures a reconciliation of non-GAAP and comparable GAAP measures can be found in our earnings press release. Please note that all numbers are in U S dollars unless otherwise stated.
Speaker Change: The following and to prepare to statement by Mr. Jim <unk>, Chairman and CEO of <unk> limited.
Jim Woo Lee: We kicked off 2024 with our Q1 revenue meeting our expectations and maintaining quarterly profitability, driven by improved growth margin and increased growth profit. During the first quarter, we achieved $80.4 million in revenue, representing a growth of 4.2% compared to the previous quarter, but a decline of 19% year-over-year. As we continue to navigate the impact of the downsides of our domestic audio live streaming business since June 2023, we anticipate its impact on our year-over-year quarterly financial comparison will gradually fade away in the second half of this year. Despite the evolving market conditions, we believe that our business continues to exhibit resilience, and we are optimistic about operations in 2024. Let's talk about our first quarter operations.
Speaker Change: Good morning, and good evening, everyone. Thank you all for joining US today, we kicked off 2024 with our Q1 revenue meeting our expectations and it may change what are the profitability.
Speaker Change: Even by improved gross margin and increased gross profits during.
Speaker Change: During the first quarter achieved $84 million in revenue, representing a growth of 22% compared to the previous quarter, but a decline of 19% year over year.
Speaker Change: As we continue to navigate the impact of the downside of our domestic audio live streaming business. Since June 2023, we anticipate its impact on our year over year quarterly financial comparisons will gradually fade away in the second half of this year.
Speaker Change: Despite the evolving market conditions with the least that our business continues to exhibit.
Lillian: Lillian and we are optimistic about the operations in 2024.
Lillian: Let's talk about our first quarter operations, our subscription revenue achieved a remarkable milestone, reaching $33 1 million, which represents a year over year growth of 12, 9%.
Jim Woo Lee: Our subscription revenue achieved a remarkable milestone, reaching $33.1 million, which represents a year-over-year growth of 12.9%. This outstanding performance can be attributed to both an increased number of subscribers and a higher conversion rate among premium subscribers. The rise in the subscriber base is primarily driven by the implementation of more effective marketing promotions, as well as the seasonal impact of Chinese New Year holidays. By continuously enhancing product features and collaborating with strategic partners to retain and acquire users, we generally expect continued development of our business, although we may encounter short-term fluctuations from time to time.
Lillian: This outstanding performance can be attributed to both an increased number of subscribers and a higher conversion rate among premium subscribers.
Lillian: The rise in the subscriber base is primarily driven by the implementation of more effective marketing promotions.
Lillian: Well as it is.
Speaker Change: The impact of Chinese new year holiday Bye.
Speaker Change: By continuously enhancing product features and collaborating with strategic partners to retain and acquire users. We generally expect to continue development of our business.
Speaker Change: When they encounter short term fluctuations from time to time.
Jim Woo Lee: In the first quarter of 2024, our cloud computing business generated a revenue of $30.2 million, reflecting a decline of 1.2% quarter over quarter and 7.8% year over year respectively, primarily attributed to intensified pricing competition and reduced sales volume of hardware devices. However, we're encouraged that we had a more than six-fold quarterly-over-quarter increase in the sales of OEA, a more affordable line of hardware devices in our product portfolio. We provide several choices of products to cater to users' different needs.
Speaker Change: In the first quarter of 2020 for our cloud computing business generated a revenue.
Speaker Change: What $32 million, reflecting a decline of one 2% quarter over quarter, and seven 8% year over year, respectively.
Speaker Change: Really attributed to intensified pricing competition and reduced sales volume of hardware devices. However, we're encouraged that we had more than six both quarter over quarter increase in sales of OA eight or more affordable lineup hardware device in our product portfolio.
Speaker Change: We provide a separate choices of products to cater users different needs.
Jim Woo Lee: Now let's turn to our live streaming and internet value-added services. We generated $17.1 million in revenue, representing an increase of 13.7% quarter-over-quarter and a decrease of 54.1% year-over-year, respectively. The decrease was due to the impact of downsizing our domestic audio live streaming business, which started last June, and we expect the impact will continue to affect our top-line comparison for a few more quarters. To mitigate its impact, we have been expanding our international operations as well as incubating new products and businesses to accelerate business development.
Speaker Change: Now, let's turn to our live streaming and the Internet value added services, we generated $17 $1 million in revenue, representing an increase of 13, 7% quarter over quarter and a decrease of 54, 1% year over year, respectively.
Speaker Change: The decrease was due to the impact of downsizing our domestic audio live streaming business started last June.
Speaker Change: We expect the impact will continue to affect our top line comparisons for a few more quarters too.
Speaker Change: To mitigate its impact will have been expanding our international operations as well as incubating new products and businesses to accelerate business development.
Jim Woo Lee: In the second half of 2024, we intend to make bold efforts to transform our business. Among our strategic initiatives, we will embrace decentralized and AI-driven technologies and harness their capabilities to enhance our operational efficiency, enrich user experiences, and gain competitive advantage. AI emerges as a revolutionary technology that will profoundly impact our lives. We acknowledge the challenges ahead, and have confidence in making progress in our endeavor given Xunlei's rich heritage of innovation and entrepreneurial spirit.
Speaker Change: In the second half of 2024, we intend to make both efforts to transform our businesses.
Speaker Change: Among our strategic initiatives, we will embrace decentralized and AI, driven technologies and Hermes aercap ability to enhance our operational efficiency in rich user experiences and to gain competitive advantages.
Speaker Change: AI emerges as a revolutionary technology that will profoundly impact on why we acknowledge the challenges ahead and have confidence in making progress in our endeavor, given Sheila rich heritage of innovation and entrepreneurial spirit.
Jim Woo Lee: We're in the early phase of innovation and strategic execution, and I look forward to providing more information and sharing with you our progress in the near future. With that, I'll turn the call over to Eric. Eric will cover the financial results in detail and provide our revenue guidance for the second quarter of 2024.
Speaker Change: We're in early stages of innovation and strategic execution, and I look forward to providing more information and sharing with you our progress in the near future.
Zhou Naijiang: With that I'll turn the call over to Eric Eric will cover the financial results in detail and provide our revenue guidance for the second quarter of 2024.
Zhou Naijiang: Thank you, Luhan, and thank you all again for participating in Xunlei's conference call to discuss the financial results of the first quarter of 2024. In the first quarter, total revenues were $18.4 million, representing a decrease of 19% year-over-year. The decrease was mainly attributable to decreased revenue from our live streaming business as a result of the downsize of domestic audio live streaming operations since June 2023. Revenues from cloud computing were $30.2 million, representing a decrease of 7.8% year-over-year.
Eric: Thank you.
Speaker Change: You all again for participating in <unk> to discuss the financial results over the first quarter of Citigroup.
Eric: In the first quarter total revenues were $84 million of $19, a decrease of 19% year over year. The decrease was mainly attributable to the decreased revenue from our large kidney disease.
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Domestic audio live streaming accretion since the June 2023.
Eric: Revenues from cloud computing.
Eric: One 2 million, representing a decrease of seven 8% year over year.
Zhou Naijiang: The decrease was mainly due to decreased revenues from certain major customers of cloud computing services, as well as decreased sales revenue of our cloud computing hardware devices. However, revenues from subscription were $33.1 million, representing an increase of 12.9% year-over-year. The increase was mainly driven by an increase in the number of subscribers. The number of subscribers was 5.76 million as of March 31st, 2024 compared with 4.84 million as of March 31st, 2023.
Eric: The decrease was mainly due to the decreased revenues from major.
Eric: Major customers of cloud computing services.
Eric: The decrease in sales revenue of our cloud computing hardware devices.
Eric: Revenues from subscription subscription were $33 1 million, representing an increase of 12, 1% year over year.
Eric: The increase was mainly driven by the increase in the number of subscribers we have.
Eric: Number of subscribers was five 6 million as of March 31, 24, compared with eight 4 million adult March 31st 2023.
Zhou Naijiang: The average revenue per subscriber for the first quarter of 2024 was RMB39.5, compared with RMB41 in the same period last year. The lower average revenue per subscriber was due to more promotional activities we conducted during the first quarter of 2024. Revenues from live streaming and other RBS were $17.1 million, representing a decrease of 54.1% year-over-year. The decrease in live streaming and other RBS revenues was mainly due to the downsides of our domestic audio live, Streaming Operations since June 2023.
Eric: The average revenue per subscriber for the first quarter of 2024 was RMB 39, five <unk>.
Eric: Third with RMB 41 in the same period last year.
Eric: The lower average revenue per subscriber was due to more promotional activities. We conduct during the first quarter alternative vehicles.
Speaker Change: Revenues from large streaming and other yes, sir.
Speaker Change: $19 1 million, representing a decrease of 54.1.
Speaker Change: Year over year.
Speaker Change: A decrease of lax fueling and other RBS revenues was mainly due to the tank cars.
Speaker Change: Mexico audio live streaming operations since the June 20 <unk>.
Zhou Naijiang: The cost of revenues was $37.1 million, representing 46.2% of our total revenues, compared with $59.3 million, or 59.8% of the total revenues in the same period of 2023. The decrease in the cost of revenues was mainly attributable to the decreased revenue sharing costs for a live streaming business, which was consistent with a decrease in live streaming revenues. Bandwidth cost that's included in the cost of revenues was $27.1 million, representing 33.8% of our total revenues, compared with $29.1 million, or 29.3% of the total revenues, in the same period of 2023.
Speaker Change: Cost of revenues were 37 $1 million, representing 46% of our total.
Speaker Change: Total revenues.
Speaker Change: Paired with 59 3 million barrels or 59, 8% of the total revenue revenues in the same theory, though 2023.
Speaker Change: The decrease in the cost of revenues was mainly attributable to the decreased revenue sharing costs for our <unk> business, which was consistent with the decrease in lodge affiliate revenues.
Speaker Change: Bandwidth costs included in cost of revenues were 27 $1 million.
Speaker Change: Representing 33, 8% of our total revenues compared with $29 $1 million or 29, 3% of the total revenues in the same period of 2026.
Speaker Change: The decrease was primarily due to the decreased bandwidth usage for the development of innovative products and a decrease in sales revenue of our cloud computing services during the quarter.
Zhou Naijiang: The decrease was primarily due to decreased bandwidth usage for the development of innovative products and the decrease in sales revenue of our cloud computing services during the quarter. The remaining cost of revenues mainly consisted of the costs related to the revenue sharing costs for a large streaming business, payment handling charges, cost of inventory sold, and depreciation of servers and other equipment.
Speaker Change: There are many cost of revenues mainly consisted of the cost related to the revenue sharing costs for our last payment business payment Henry charges cost of inventory scope and depreciation of schools and other equipment.
Zhou Naijiang: Gross profit for the first quarter of 2024 was $42.8 million, representing an increase of 8.2% year-over-year. Gross profit margin was 53.3% in the first quarter of 2024, compared with 39.9% in the same period of 2023. The increase in gross profit was mainly driven by the increase in gross profit of our subscription business, and the increase in gross profit margin was mainly attributable to the increased percentage of subscription revenues to total revenues, which has a high gross profit margin, as well as the decreased percentage of live streaming revenues to total revenues, which has a relatively lower gross profit margin.
Speaker Change: Gross profit for the first quarter of 2024 was $42 8 million.
Speaker Change: Representing an increase of eight 2% year over year.
Speaker Change: Gross profit margin was 53, 3% in the first quarter of 2012 before.
Speaker Change: Paired with 39, 9% in the same period of 2023.
Speaker Change: The increase in gross pocket was mainly driven by the increase in the gross profit of our subscription business.
Speaker Change: And then the increase in gross profit margin was mainly attributable to the increase the percentage of subscription revenues to total revenues, which has a higher gross profit margin.
Speaker Change: The decreased percentage of lapsed Judy revenues to total revenues, which has a relatively lower gross profit margin.
Zhou Naijiang: Research and development expenses for the first quarter of 2024 were $17.6 million, representing 22% of our total revenues, compared with $18 million, or 18.2% of our total revenues, in the same period of 2023. The decrease was primarily due to a decrease in employee compensation incurred during the quarter.
Speaker Change: Research and development expenses for the first quarter authenticate before was $17 $6 million, representing 22% ballpark with revenues compared with $18 million or 18 toxin, but with the revenues in the same period of 2023.
Speaker Change: Right.
The decrease was primarily due to the decrease in employee compensation incurred during the quarter.
Zhou Naijiang: Sales and marketing expenses for the first quarter of 2024 were $10.1 million, representing 12.5% of our total revenues, compared with $9.3 million, or 9.4% of our total revenues in the same period of 2023. The increase was primarily due to more marketing expenses incurred during the quarter for our subscription and overseas live streaming business, as part of our ongoing efforts to acquire yield. GNA expenses for the first quarter of 2024 were $11.1 million, representing 13.9% of our total revenues, compared with $11.7 million, or 11.8% of our total revenues in the same period of 2023. The decrease was primarily due to decreased share-based competition expenses, partially offset by the increase in labor costs during the quarter.
Speaker Change: Sales and marketing expenses for the first quarter authentically before where pinpoint the $1 billion, representing 5% total revenues compared with $9 $3 million or nine 4% of revenues in the same period of 2023.
Speaker Change: The increase was primarily due to more marketing expenses incurred during the quarter for subscription and overseas luxury businesses.
Speaker Change: Part of our ongoing efforts on your equity issue.
Speaker Change: G&A expenses for the fourth quarter of 2034 or $11 1 million.
Speaker Change: Representing 39%, our political revenues compared with $11 7 million or.
Speaker Change: 11, 8% of our total revenues in the same period of 2023.
Speaker Change: The decrease was primarily due to the decreased share based compensation expenses, partially offset by the increase in labor costs during the quarter.
Zhou Naijiang: Operating income was $4 million compared with an operating income of $0.7 million in the same period of 2023. The increase in operating income was primarily attributable to an increase in gross profit from our subscription business during the quarter. Other income was $0.3 million compared with other income of $1.4 million in the same period of 2023. The decrease was primarily due to a one-time lack of a long-term investment and the decrease in subsidy income received during the first quarter of 2024.
Speaker Change: Operating income was 4 million logs compared with an operating income of <unk> 7 billion in the same period of 2023.
Speaker Change: The increase in operating income was primarily attributable to the increased gross profit from our subscription business during the quarter.
Speaker Change: Other income was $3 million compared with other income of $1 4 million loss in the.
Speaker Change: Period of 2023.
Speaker Change: The decrease was primarily due to one time Blackhawk.
Speaker Change: Long term investment and a decrease in subsidy income received during the first quarter of <unk>.
Zhou Naijiang: Net income was $3.6 million compared with $1.2 million in the same period of 2023. Non-debt net income was $4.5 million in the first quarter of 2024 compared with $5.5 million in the same period last year. The increase in net income was primarily attributable to the increase in the gross profit of the subscription business, partially offset by the decrease in other income, as discussed above. The decrease in non-gap net income was primarily attributable to the increase in labor costs as compared with the same period of 2023.
Speaker Change: Net income was $3 6 million compared with $1 $2 million in the same period of 2023.
Speaker Change: non-GAAP net income was $4 5 million loss in the first quarter of 2024, compared with <unk> 5 million loss in the same period of last year.
Speaker Change: The increase in net income was primarily attributable to the increase in the cost pockets of our subscription business, partially offset by the decrease in other income as discussed above.
Speaker Change: The decrease in non-GAAP net income was primarily attributable to the increase in labor costs as compared with the same period of 2026.
Zhou Naijiang: Dalu's earnings per ADS in the first quarter of 2024 were approximately 6 cents, as compared to 2 cents in the same period of 2023. As of March 31, 2024, the company had cash, cash equivalents, and short-term investments of $272.5 million, compared with $271.9 million as of March 31, 2023. The increase in cash, equipment, and short-term investments was mainly due to the net cash from operations and proceeds from bank borrowings, partially offset by repayment of bank borrowings, spending on share buybacks, and payment for long-term investments during the first quarter of 2024.
Speaker Change: Diluted earnings book It it is in the first quarter of 'twenty two before was approximately six times as compared to two <unk> in the same period of 2023.
Speaker Change: As of March 31, 2018 report the company had cash cash equivalents and short term investments of $272 million compared with 271 $9 million as of March 31 2023.
The increase in cash cash equivalents and shortcoming batteries was mainly due to the net cash from appreciates and the proceeds from bank borrowings, partially offset by repayment of bank borrowings spending on share buybacks and a payment for a long term investment due to the first quarter of 2012.
Zhou Naijiang: Now turning to our Shared Purchase Program, in June 2023, Xunlei announced that its Board of Directors had authorized the purchase of up to $20 million of its shares over the next 12 months. As of March 34, 2024, the company had spent approximately $4.7 million on share buybacks under the Share to Push Forum. Founder-in-Chief for Revenue Gardens, For the second quarter of 2024, Xunlei estimates total revenues to be between $79 million and $84 million, and the midpoint of the range represents a quote-unquote increase of approximately 1.4 percent.
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Speaker Change: Now turning to our share repurchase program in June 20th industry, <unk> announced that its board of directors has authorized repurchase of up to $20 million of its shares over the next 12 months.
Speaker Change: As of March 31st 2024. The company has spent approximately $4 7 million on share buybacks under the shelf could push Poland.
Speaker Change: Finally for our revenue guidance for the second quarter of 2000, and therefore surely estimates total revenues to be between 17 $9 million and $84 million.
And at the midpoint of range represents a quarter over quarter increase of approximately one 4%.
Zhou Naijiang: This estimate represents our management's preliminary view of the date of this crisis, which is subject to change, and any change could be material. Now, we conclude prepared remarks for the conference call. Operators, we are ready to take questions. Thank you.
Speaker Change: This accurately represents our management's preliminary view as of the date of this press release, which is subject to change and any change could be material.
Speaker Change: Now we conclude our prepared remarks for the conference call.
Speaker Change: We are ready to take questions.
Operator: Thank you. We will now begin the question and answer session. To ask a question, please press star 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please stand by while we compile the Q&A roster. Our first question comes from Yajin Guo from Ping'an Insurance. Go ahead.
Speaker Change: Thank you we will now begin the question and answer session.
Speaker Change: So a question. Please press star one one on your telephone and wait for your name to be announced to.
To withdraw your question. Please press star one again please.
Speaker Change: Please standby, while we compile the Q&A roster.
Speaker Change: Our first question comes from the line of Jean Cool from Ping an insurance. Please go ahead.
Yajin Guo: Hello, Management Team. First of all, congratulations on our membership income rising. But I observed that our membership numbers have fallen in this quarter. So, what is our current development strategy for the membership business, and what is our strategy for future new customers?
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Unknown Executive: She stated that the First Lady and Congress on Record Revenue for the Subscription Business, and she observed a decline in the number of subscribers this quarter compared with the previous quarter. She would like to know some insights into the current strategy for the subscription business and our approach to acquire new users. Thanks for asking. The decline in the number of subscribers in the first quarter of 2024 was due to the seasonal impact of the Chinese New Year holidays.
Speaker Change:
Speaker Change: As she stated that the first study in Congress on the record revenue for the subscription business.
Speaker Change: And as she observed a decline in the number of subscribers this quarter compared with the previous quarter.
Speaker Change: Good luck moving from.
Speaker Change: Some insights into the current strategy for subscription business.
Speaker Change: Oh approach to acquire new users.
Speaker Change: Thanks for asking the declines in a number of subscribers in the first quarter of 2024.
Speaker Change: Due to the seasonal impact of the Chinese new year holidays.
Unknown Executive: Currently, we are implementing a multi-faceted strategy to enhance users' loyalty and foster collaborations with various online platforms and strategic partners to acquire new users. Generally speaking, we expect to maintain a relatively stable user base and product revenue, although we may encounter fluctuations from time to time. Going forward, our focus will remain on building a robust and sustainable ecosystem, enhancing user benefits, and iterating more features to boost user engagement and expand user base. Thank you, and others. And I think that's a really good point.
Speaker Change: Currently we are implementing a myocardial biopsy get strategies to enhance yogurt loyalty.
Speaker Change: Foster collaborations with various online platforms and a strategic partner to acquire new users.
Speaker Change: Generally speaking, we expect to maintain relatively stable user base and our product revenue.
Speaker Change: Although we may encounter fluctuations from time to time.
Speaker Change: Going forward, our focus will remain on the <unk>.
Speaker Change: Robust and sustainable ecosystem.
Speaker Change: Enhancing.
Speaker Change: Huge benefits.
Speaker Change: Deteriorating more features to boost the user engagement.
Speaker Change: To expand user base. Thank you.
Unknown Executive: In 2024, the reason why the number of our members decreased compared to the first quarter was also due to the seasonal impact of the Chinese Spring Festival. We have also adopted a multi-faceted approach to enhance the loyalty of existing members as well as some strategies to attract new users with multiple platforms and partners. Generally speaking, we expect that the number of members and the revenue of our members' businesses will remain relatively stable, although these numbers will fluctuate from time to time.
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Unknown Executive: In the future, we will continue to build a member ecosystem that is healthy and sustainable to increase the rights of members and bring more functions to the chain, thereby increasing the age of our users and attracting more new users. Thank you for your question.
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Yajin Guo: Thank you for your answer. I have one more question.
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Yajin Guo: I noticed in our financial report that since June last year, the company has been reducing its domestic live streaming business. So the first quarter's income was also affected by the business reduction. Will the domestic voice streaming business continue to affect our income? And will we be able to resume domestic voice streaming business operations in the future? Thank you.
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Unknown Executive: The question is, according to the first quarter earnings press release, you mentioned that the decrease in live streaming revenues was because Xunlei had downsized its domestic audio live streaming business since June 2023. I wonder how much this will continue to affect your future earnings and if Xunlei plans to resume these operations in the future. Thanks for asking. We have already completed the downsizing of our domestic audio live streaming business, and the impact on our future financial health will be minimal, if any, on a sequential basis, and we don't have any plans right now to resume this business. Instead, we will focus on expanding our operations overseas to mitigate the impact of this business adjustment.
Speaker Change: The question is.
Speaker Change: For the first quarter earnings press release.
Speaker Change: You mentioned that the decrease in live streaming revenues was because Chile has done.
Speaker Change: Domestic audio live streaming business since the June 2023.
Speaker Change: I wonder how much of this work with you to affect your future earnings.
Speaker Change: They accumulate plans to resume this approach used in the future.
Speaker Change: Thanks for asking them, we have already completed study of our domestic audio live streaming business.
Speaker Change: And then the impact on our future financial results will be minimal if any on a sequential basis.
Speaker Change: And we don't have any plans right now to resume this op.
Speaker Change: Business.
Speaker Change: Instead, we were focused on expanding our operations overseas to mitigate the impact of this business adjustments thankfully.
Unknown Executive: Our domestic voice business has basically been reduced. On the basis of Huanbi, we expect that the adjustment for the voice business will have little or no impact on our future financial data. The company has not yet considered resuming the operation of domestic voice products. We are also working hard to expand overseas operations and hope to reduce business adjustments.
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Unknown Executive: and the impact of the reduction in business adjustments. Thank you for your questions. Thank you for your answer.
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Operator: Thank you for your question. As a reminder, to ask a question now, please press star 11 on your telephone keypad. I'm showing no further questions. I'll now turn the conference back to the management team.
Speaker Change: Thank you for your question.
Speaker Change: As a reminder to ask a question now please press star one on your telephone keypad.
Speaker Change: I am showing no further questions I'll now turn the conference back to the management team for closing comments.
Unknown Executive: Thank you again for your time and participation. If you have any questions, please feel free to visit our website at ir.xunlei.com or send us an email to our investor relations department.
Speaker Change: Thank you again for your time.
Speaker Change: Participation. If you have any questions. Please feel free to visit our website at IR <unk> Com will send us E mail to our Investor relations have a good day.
Operator: Have a good day. It is our pleasure to conclude today's conference call. Thank you. Thank you. That concludes today's conference call. Thank you for participating. You may now go.
Speaker Change: Operationally conclude today's conference call. Thank you.
Speaker Change: Thank you that concludes today's conference call. Thank you for participating you may now disconnect.
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