Q3 2024 QuantaSing Group Ltd Earnings Call
Unknown Executive: Good morning, and good evening, ladies and gentlemen. Thank you for standing by, and welcome to the Quantasing Earnings Conference Call. At this time, all participants are in the lesson only mode.
Good morning, and good evening, ladies and gentlemen.
Speaker Change: Thank you for standing by and welcome to contact things earnings Conference calls.
Speaker Change: At this time, all participants are in listen only mode.
Unknown Executive: We will be hosting a question and answer session after the management's prepared remarks. Please note that today's event is being recorded. I now turn the conference over to Ms. Leah Guo, the Investor Relations Associate Director of the company. Please go ahead, Ms. Guo.
Speaker Change: We'll be hosting a question and answer session. After the management's prepared remarks.
Speaker Change: Please note that today's event is being recorded.
Speaker Change: I now turn the conference over to MS. Leah Cool Investor Relations Associate director of the company. Please go ahead ma'am.
Leah Guo: Thank you. Hello, everyone, and welcome to Quantasing's earnings call for the third quarter of fiscal year 2024. With us today are Mr. Peng Li, our founder, chairman, and CEO, and Mr. Tim Xie, our CFO. Mr. Li will provide a business overview for the quarter. Then Tim will discuss the financials in more detail. Following their prepared remarks, Mr. Li and Tim will be available for the Q&A session. I will translate for Mr. Li.
Speaker Change: Thank you Hello, everyone and welcome to conquer things earnings call for the third quarter, our physical year 'twenty 'twenty four we got to tell you on Mr. Palmer, our founder Chairman and CEO and Mr. Chen our.
Speaker Change: Now, let's see asphalt Mr. Lee will provide you an overview for the quarter, then gene will discuss financials in more detail. Following their prepared remarks, Mr. Liang will be available for the Q&A session I will translate for Mr. Li you can refer to our quarterly financial results on our IR website.
And I have talked Qantas in Dot Com you can also access a replay of this call Oh I'll upset when it becomes available a few hours. After its conclusion before we will continue I would like to refer you to our safe Harbor statement in our earnings press release, which also applies to this call.
Leah Guo: You can refer to our quarterly financial results on our IR website at ir.quantasing.com. You can also access a replay of this call on our IR website when it becomes available a few hours after its conclusion. Before we continue, I would like to refer you to our safe harbor statement in our earnings press release, which also applies to this call. As we will be making forward-looking statements, please note that all numbers stated in the following management's prepared remarks are in R&B terms, and we will discuss non-GAAP measures today, which are more thoroughly explained and reconciled to the most comparable measures reported in our earnings release and filing with the SEC. I will now turn the call over to the CEO and founder of Quantasing, Mr. Li.
Speaker Change: As we will be making forward looking statements. Please note that all numbers stated in the following management's prepared remarks.
Speaker Change: In RMB terms, and we will discuss non-GAAP measures today, which are more thoroughly explained and reconciled to the most comparable measures reported in our earnings release and the filings with the S. E C.
I'll now turn the call over to the CEO and founder of Qantas thing Mr. Li.
Peng Li: Hello, everyone, and thank you all for joining us today. This quarter, we continue to expand our course offerings to better serve the growing elderly learning market. While continuing to provide learning courses for our customer base, we are offering a wider range of targeted products to our users. These efforts put us in a good position to monetize our user base, both through engagement and revenue in addition to our diverse educational offerings. Our revenue declined slightly by 3.6% from the last quarter, but it grew by 17.1% year-over-year.
Speaker Change: Hello, everyone and thank you all for joining us today.
Walter we continue to expand our course offerings to better serve the growing elderly learning market.
While continuing to provide the learning Cortez fault, our customer base, we are offering a wide wider range of targeted products to our users.
First put us in a good position to monetize.
Speaker Change: Monetize our user base.
Speaker Change: The engagements and drive revenue in addition to our diverse educational offerings.
Speaker Change: Although revenue declined slightly by a three point, 60% from the last quarter, but rose by 17.
Speaker Change: 17.1% year over year.
Peng Li: Considering the nature of our business model, as revenue will be impacted by financial recognition, we believe that growth buildings better represent our business growth. During this quarter, our gross revenue from individual online learning services was RMB 981.5 million, representing 3.9% quarter-over-quarter growth and 22.1% year-over-year growth.
Speaker Change: Considering the nature of our business model as revenue will be impacted by the initial rak good niche and lose weight, but he was that gross billings better represents our business grows.
Speaker Change: During this quarter, our gross billings from individual online learning services were RMB.
Speaker Change: 981 point.
Speaker Change: 5 million.
Speaker Change: Representing.
<unk>, 3.9% quarter over quarter growth and a 22.1% to year over year of course.
Peng Li: Now let's take a look at our courses for elderly users. We are gaining more elderly users by improving our cost, and offerings for this group. A recent industry report shows that 77.2% of middle-aged and elderly people are interested in learning for personal interest. Paying for classes can become a common way to learn with 78.5% of learners in older cohorts mainly choosing online platforms for their interest qualities. Elderly users are especially interested in unique Chinese recommended theories, for example, in Traditional Exercise Diet and Traditional Chinese Medicine or TCM.
Speaker Change: Now, let's take a look at our culture's fall out of the users.
Speaker Change: We're gaining more elderly users by improving our cost.
Speaker Change: Offerings for this group.
Speaker Change: A recent industry report shows that 77, 2% of middle aged and elderly people are interested in learning for personal interests.
Paying for classes classes can become a common way to learn right.
Speaker Change: Seven seven T H ponds five per cent of illness in older cohorts, mainly talking online platform its fall interest to car Ts.
How old are the users, especially interested in Chinese recommend a serious for example.
Speaker Change: And could you just know exercise.
Speaker Change: Dodge and traditional Chinese met this medicine.
Speaker Change: Oh, yeah yeah.
Peng Li: In addition, these users often have more free time and are willing to learn through more systematic guidance of traditional health recommendations and TTMs. Based on our experience, we have also found that elderly users are eager to try out a wide variety of different causes to meet the focus on fitness among our elderly users. We have launched more recreational TCM-related causes. One new caught in is the baduanjing exercise. It combines physical movements with controlled breathing.
Speaker Change: In addition, diffusers often have more free time and are willing to learn through mall, a systematic our guidance of a traditional house recommends and Tucson.
Speaker Change: Based on our experience we have also farmed out out of the users are eager to try out a wide variety of different causes.
Speaker Change: To me the bulk us fitness a mall our elderly users we have launched a mall a recreational GCM related causes.
Speaker Change: While new costs in <unk> is a patented exercise.
Speaker Change: Bass physical moments with controlled breathing.
Peng Li: This helps the flow of vital energy and makes blood circulation better, to cater to all users willing to try a bit of everything. We also launched a series of mini-lectures. Each of these lectures is smaller in scope, making them easier to approach. One example is our six-day program Introducing TCM Theory, which focuses on how vital energy and blood work in the body.
Speaker Change: This helps the flow of volatile entity and makes plaza.
Speaker Change: Stipulation badger.
Speaker Change: To cater to all the users willingness to try a Beatles arity.
Speaker Change: We also launched a series of self and many lectures.
Speaker Change: It sure does lag Cherokee is smaller in scope, making it easier to approach.
Why is that Paul is our six day program of introducing TCR in Missouri.
Speaker Change: His focus is halt lethal energy and a lot of work in the body.
Peng Li: This course uses exercises to help cure common issues like being unable to sleep. Our mini-courses have shorter learning periods and lower prices, which makes them accessible to more people. The new TCM courses are also good additions to our existing courses, like standing meditation, calligraphy, and piano, giving our users a wider range of options. In addition to working with local communities, We launched an educational tour program in April to expand our revenue stream. This program allows users to learn about all dogs, giving them a unique experience.
Speaker Change: This cost us exercises to.
Speaker Change: How cute common issues like being unable to sleep.
Speaker Change: How many quarters, how salter learning Paris, and the lower prices.
Speaker Change: Which makes them.
Speaker Change: Because that's a bowl with two more people.
Speaker Change: The new Sam Cortez also good additions to our existing coffees like standing meditation.
Speaker Change: Chemical our feet on the piano.
Speaker Change: Giving our users a wider range of options.
Speaker Change: Yeah, do you send to working with local communities.
Speaker Change: We launched a how do you pitch no tour program in April to expand our revenue streams.
Speaker Change: This program allows users to learn all doors.
Speaker Change: Giving them a unique experience.
Peng Li: The program is especially appealing to our elderly users, who embraced it. This fully meets the learning and social needs of middle-aged and elderly users. Our approach makes the overall learning experience more... Dynamic and Interconnected, at the same time. We have worked closely with local communities. We do this to provide a more meaningful experience for our users and help them feel a greater sense of belonging. For example, in March, we offered free offline courses to communities in Beijing. We received positive feedback. People said our activities, especially standing meditation and calligraphy, greatly enriched the spiritual lives of elderly residents. Local communities value the elderly highly and care for their needs.
Speaker Change: Program, ASIC, especially appealing to our elderly users.
Speaker Change: Who embraced.
Speaker Change:
Speaker Change: Opportunity to winter into the vote and to learn it to also connect our online and offline services.
Speaker Change: All of our activities lead to offline engagements and are less versa.
Speaker Change: This fully meet the linear and the social needs of Middle age that undoubtedly uses our approach make makes the overall learning experience small.
Speaker Change: Dynamic and are interconnected.
Speaker Change: In time.
Speaker Change: We have worked closely with local came in communities. We do this to provide a more meaningful experience for our users and helps them feel a greater sense of belonging for example in March we all of our the three offline called phase two communities in Beijing lately.
Speaker Change: Stable to positive feedback.
Speaker Change: People is that our activities, especially standing meditation and critical Rafi greatly enriched our spirit chill lapsed of elderly residents.
Speaker Change: Local communities valued.
Speaker Change: Elderly highly and careful there are nice.
Peng Li: They recognize the demand for interest-based learning among middle-aged and elderly people. They actively promote the idea of shifting from passive aging to active aging, which aligns with our belief. With more users actively participating in our community, we are building a stronger connection among learners. This enhances their sense of belonging to our platform. As this sense of community grows, users are more likely to share their good experience of our platform with others.
Speaker Change: They recognize the demands of fall interest based learning among middle age gone out to the people.
Speaker Change: Are they actively promote the idea of shifting from.
Speaker Change: Passe aging to active aging rich.
Speaker Change: Which aligns with our beliefs.
Speaker Change: With more users actively participating in our community. We are building a stronger connections among learn us today as he hands is their sense of belonging to our platform.
Speaker Change: This sense of community growth.
Speaker Change: Users are more likely to share their good experience of our platform with us.
Peng Li: The result is a positive circle, which has greatly boosted our cost popularity and drawn new users. The number of registered users for our recreation and lecture topics has grown rapidly. It has increased from 3.3 million a year ago to 13.1 million.
Speaker Change: The result is a positive a social reach has greatly boosted our call.
Speaker Change: The popularity and the drawing you users.
Speaker Change: The number of registered users for our recreation and let her Cortes, how Corey how growing rapidly.
Speaker Change: It has increased from $3 3 million a year ago to 13 points of why maybe.
Peng Li: We are also continuing to build a growing learning platform for our users. Our data analysis and internal market research shows that skills upgrading courses, especially short video courses, remain a popular choice for learning. According to a report, China has over 1 billion online audiovisual users. 98.3% of internet users in China use audiovisual services. The average person watches short videos for 151 minutes per day.
Speaker Change: We're also continuing to build a growing learning platform for our users.
Speaker Change: Our data analysis, and our internal market research shows that skills upgrading causes, especially yourself redo Cortez remains a popular choice for learning.
Speaker Change: According to a report China has over 1 billion online audio reidsville users.
Speaker Change: H E a Nike H 0.3.
Speaker Change: 3% of inter Knights users in China use audio services.
Speaker Change: So a salaried person watches salt videos for 151 minutes per day.
Peng Li: This trend is driven by the convenience and ease of access of short video formats. These allow users to engage with content quickly and efficiently, fitting into their business schedules. As a result, we have seen a steady increase in user engagement and satisfaction for this type of course, as shown by an impressive 98.5% satisfaction rate. Using our test data scale approach, we have increased interest in, and investment in, video content in line with market trends.
Speaker Change: This trend is driven by the convenience and ease of access of short video formats.
Speaker Change: It does allow users to engage with content quickly and efficiently.
Speaker Change: Getting into their our business Shadows.
Speaker Change: As a result, we have been a steady increase in user engagement and satisfaction for these types of Cortez.
As shown by our impressive 19 age 0.5% satisfaction rich.
Speaker Change: Using our test at our scale our approach, we how increased interest to our investment in.
Speaker Change: So we do a coffee is in line with market trends.
Peng Li: We continue to use diverse formats to attract users. Building upon the success of our previous training CAP offerings, we have upgraded our short video course. Our upgrade incorporates valuable feedback from our dedicated community of learners and our latest observations of the short video industry. The Enhanced Course Offering provides a well-rounded and practical learning experience. It covers advanced technical, Emerging Trends, personalized guidance on overall account positioning, and copywriting strategies. It also provides an immersive experience.
Speaker Change: We continue to use a diverse format to attract users.
Building upon the successful follow up previous training cap offerings.
Upgraded our short video call.
Speaker Change: Upgrades incorporates valuable feedbacks from our dedicated community of Novartis under our latest observations of the short video industry.
Speaker Change: The it has to cost offering provides a well rounded and a practical learning experience its powers advanced technicals.
Speaker Change: Emerging trends a person night.
Speaker Change: Personal last guidance on overall account positioning on the Copywriting strategies. It also provides.
Speaker Change: And immersive.
Peng Li: Immersive Learning Environment with Live Sessions, interactive workshops, and a vibrant community of like-minded individuals. The course meets the evolving needs of our users and helps our learning platform remain competitive and innovative in the market. As a result of these efforts, we are seeing growth feelings from individual online learning services, and we expect to see revenue growth in the next fiscal quarter. I was trying to focus on skills upgrading causes, especially short video, which is in line with market demand.
Speaker Change: E Mercy learning environments with meiosis fashions.
Speaker Change: Interactive workshops and vibrant.
Speaker Change: Community of like mandate is reduced.
Speaker Change: Costs meet the evolving needs of our users and help our learning platform and remain competitive team competitive and in a way to you in the market.
Speaker Change: As a result of these efforts we are seeing the girls also gross billings from in the video online learning and somebody says.
Speaker Change: <unk> is back to see revenue growth in the NAFTA physical culture.
Speaker Change: I was trying to take focus on Skus upgrading cortez.
Speaker Change: Especially yourself, we do okay.
Speaker Change: It's in line with my Phd mouse.
Peng Li: This positions us for continued growth and success in the learning and development space. Our commitment to innovation and growth goes beyond our core educational offerings. We now have a large customer base of middle-aged and elderly users for our learning business, and we are in a great position to cross-sell additional products and services to them. We aim to encourage learners to use our e-commerce business, to extend the LTV of our paying users and leverage our registered user base. We will offer them a full range of learning materials and related products. To do so, we will also leverage our established online infrastructure, including our WeChat mini program and our existing live streaming system.
Speaker Change: This positions us for continued growth and success in learning and development space.
Speaker Change: [noise] all our commitments to innovation on the girls goes beyond our call educational offerings.
Speaker Change: We now have a large customer base of middle age that are out there the users for our lending business.
We're in a great position to cross sell additional products and the services to them.
Speaker Change: We aim to encourage this engagement our engagement our learners to use our e-commerce business.
Speaker Change: Two is turned to our T V of our paying users and leverage our registered user base.
Speaker Change: We will offer them a full range of learning materials and the related products.
Speaker Change: To do so we also leverage our established online E Frac truck share.
Including our Wechat mini program on our existing lapsed dreaming system.
Peng Li: This will minimize our e-commerce products' operating costs and optimize the market. By truly understanding what our users want and need, we can give them a smooth, customized experience that will benefit both our learners and our business. To be more specific, there is growing demand from this group of users for healthcare offerings. We are leveraging this user base to expand our product offering. Recently, we released a series of healthcare products targeting the elderly market.
Speaker Change: This will minimize our e-commerce products operating cost.
Speaker Change: And our optimize the market.
Speaker Change: By truly understanding what our users longtime the neat we can't give them a smooth.
Speaker Change: Customized experience that benefits both our learners.
Speaker Change: Business.
Speaker Change: To be more specific this is growing a demand from this group hall for users for health care offerings.
We are leveraging our user base.
Speaker Change: Phase two weeks and our product offerings recently, we released a serious offer health care products targeting the elderly market.
Peng Li: At the same time, we continue to provide them with learning content. These healthcare products generated growth GMV of RMB 9.5 million in March and RMB 10.2 million in April. We have used our existing users' profiles to help us to develop and provide label products that we sell through live e-commerce. For example, Chinese liquor.
Speaker Change: At the same time, we continue to provide them with learning and Cortez.
Speaker Change: This health care products generated a gross.
Jim Lee: Jim Lee of RMB nine upon file meaning you in March and the RMB ton plant too many in April.
Speaker Change: We have a use to all existing users profiles to help us to develop a provides label products that we sell through love and E Commerce.
Speaker Change: For example, Chinese like Chinese later.
Peng Li: Using our deep industry experience and user feedback and data we've gathered, we are developing new products that match changing customer likes and wants. By using data to guide us, we plan to make innovative and high quality private label products that appeal to our customers and drive growth in this promising segment. At the same time, to better serve our elderly customers, we have created a separate business team. This team focuses on developing and marketing special features for customers. Special colleague designed by the Middle-aged and Elderly.
Using our deep.
Speaker Change: Industry experience and the user feedback and that's how we gather we are developing new products that match, our changing customer like stand alone <unk>.
Using data to get US we plan to make it in a way too on the high quality problem.
Speaker Change: Private label products that appeal to our customers and drive growth in this promising segments.
Speaker Change: At the same time.
Speaker Change: To better serve our elderly customers we have created.
Speaker Change: Uh huh.
Speaker Change: Separately its business too.
Speaker Change: This team focus on developing and marketing customer protect spat Shaw for spar.
Speaker Change: Special.
Cody: Special Cody.
Speaker Change: The times are bad.
Peng Li: We made this decision based on our experience interacting with this demographic group. We noticed that middle-aged and elderly individuals show a willingness to purchase products and services. This aligns with China's large population and rising living standards, making the Silver Economy a Sunrise Industry.
Middle age down to Audi We made this decision based on my experience interacting with this demographic group.
Speaker Change: We noticed that a middle aged and elderly individuals show willingness to purchase products on the surface.
Speaker Change: There's a lot of ways, China large population and a rising living standards.
Speaker Change: Making the silver economy Satirised industry.
Peng Li: Now let's turn to our overseas development. Our Calis education platform in Hong Kong is a testing area before we expand more broadly into the learning market overseas. Ferris allows us to test.
Speaker Change: Now, let's turn to our overseas developments.
Kelly: Kelly Education platform in Hong Kong is a testing area before they spend more broadly into the learning markets overseas.
Speaker Change: Terrorists allow us to test.
Speaker Change: Market conditions.
Speaker Change: Conditions.
Speaker Change: I'll engage the users out in the hall, if in fact, you our offerings.
Speaker Change: All in a controlled environment.
Speaker Change: Before scaling up to larger market.
Peng Li: Market Conditions, how engaged the users are, and how effective our offerings are, all in a controlled environment before scaling up to larger markets. On May 27th, Kelly's Education opened its first offline school in Tuen Wan, Hong Kong, combining online and traditional learning methods. The interactive learning center offering offers high quality educational resources and teaching and an engaging experience for children. Kelly is now positioned as a premier children's English learning platform in Hong Kong.
Speaker Change: I'll make a 27th.
Speaker Change: Kelly your fabrication opened his first the offline schools in Shanghai, Hong Kong come by me online and the traditional learning methods.
The interactive learning center offering offers high quality educational Celsius, and the teaching and are engaging experience for children.
Speaker Change: <unk> is now positioned as a premier.
Speaker Change: Children's English learning platform in Hong Kong.
Peng Li: We also plan to open an office in Hong Kong this June to extend our reach to the overseas market. This expansion represents our growing commitment to expand our business overseas. Our Hong Kong office will serve as a base for us to pursue our ongoing M&A efforts.
Speaker Change: We also plan to open an office in Hong Kong, it's good to extend our reach to the overseas market.
This expansion.
Speaker Change: Represents our growing commitment to expand our business overseas.
Speaker Change: Our Hong Kong office to be able to serve as a base for us to.
Speaker Change: Pursue our ongoing Amanda as ever.
Peng Li: It will also function as a launchpad for our company to enter new markets around the world. During the quarter, we improved our courses for the elderly learning market and invested in popular short video courses. This helped grow our user base and set the stage for future revenue streams. For our private label Chinese liquor products, we use data-driven approaches to guide innovation.
Speaker Change: It will also function as a.
Speaker Change: The launch pad for our company to enter new markets around the world.
Speaker Change: During the culture, we improved our coffee as far as the elderly learning market on the invest either in pulp in popular ourselves we do Cortes.
Speaker Change: This helped grow our user base and set the stage for future revenue.
Speaker Change: Our revenue stream.
Speaker Change: For our private label Chinese Laker product.
Speaker Change: We used our data driven approach to get innovation.
Peng Li: We further leveraged our existing user base to expand into consumer product sales. We have made good progress with Kali's education, further solidifying our business presence in the Hong Kong market. By continuously enhancing the learning experience and offering comprehensive ecosystems, we are well positioned for sustained growth across both education and e-commerce. With that, I will turn the call over to Tim to discuss the details of our financial... Thank you.
Speaker Change: A further leverage of our existing user base two weeks pen.
Speaker Change: Into consumer our consumer product sales.
Speaker Change: We have made good progress.
Speaker Change: Progress with Kelly's education.
First solidifying our business play this in the Hong Kong market.
Speaker Change: By continuously enhancing learning experience and offering.
Speaker Change: Comprehensive.
Speaker Change: I'll Echo system.
Speaker Change: We are well positioned for sustained growth across both education on the E Commerce.
Speaker Change: With that I'll turn the call over to Tim to discuss the details of our financial Center.
Dong Xie: Before I go to the details of our financial results, please note that all amounts are in RMB terms, that the reporting period is the third quarter of fiscal year 2024, ending on June 30, 2024, and that in addition to gap measures, we'll also be discussing non-gap measures to provide greater clarity on the trends in our actual operations. For the third quarter of fiscal year 2024, we achieved total revenues of $945.6 million, a year-over-year growth of 17.1%, mainly driven by the growth in revenues from skills upgrading courses.
Tim: Thank you before I go into details of our financial results. Please note that all amounts are in RMB terms.
Tim: That's the reporting period as the third quarter of fiscal year 'twenty 'twenty 490 on June 32024, and vacuum addition to matters. We'll also be discussing non-GAAP measures to provide greater clarity on the change in our actual operations.
Dong Xie: Among our revenues, revenues from individual online learning services grew by 14.3% year-over-year to $828.1 million, 87.6% of total revenues, mainly due to continued demand for skilled upgrading courses. Our growth building of individual online learning services increased by 22.1% year-over-year to 981.5 million. Great news from Enterprise Services World 65.
Tim: For the third quarter of fiscal year 'twenty to 'twenty four we achieved total revenues of.
Tim: $945 six minute, but year over year growth of 17, 1%.
Tim: Driven by the growth of the revenues from skills upgrading courses.
Tim: Well most of our revenues revenues from you do we do online learning services grew by 14 points, 3% year over year to 828 1 million.
All 887, 6% of total revenues, mainly due to continued demand for skilled upgrading closest.
Tim: Our gross billings so if indeed, we do all our learning services increased by.
Tim: 22, 1% year over year to 981 five minute.
Revenues from Enterprise services was 65.
Dong Xie: 0.1 million, a change of 19.8% from a year ago and representing 6.9% of total revenue, primarily due to a decline in revenues from relief market transactions. Gross profit was $799.7 million, representing a gross margin of 84.6%, compared to 87.5% in the same period last year. Total operating expenses were $804.9 million compared to $729.3 million in the same period last year. To break this down, sales and marketing expenses were $729.6 million, representing a change of 15.6% year-over-year, mainly because we increased our spending on outsourcing labor and marketing efforts.
Speaker Change: 0.1, meaning the change of 19 point.
Speaker Change: 8% from a year ago.
Speaker Change: Finally, representing six 9% of total revenues.
I'm really due to a decline in revenues from relief broker transactions.
Speaker Change: Gross profit was 719, nine 7 million, representing a gross margin of 84.6% comp.
Two seven.
Speaker Change: Seven 5% in the center you read last year.
Speaker Change: Total operating expenses were $804 9 million compared to $729 3 million of some period last year.
To break this down.
Speaker Change: Sales and marketing expenses were $729 6 million, representing a change of 15, 6% year over year.
Speaker Change: Mainly because we increased our spending all sorts of labor and marketing efforts as a percentage of total revenue non-GAAP sales and marketing expenses.
Dong Xie: As a percentage of total revenue, long-gap sales and marketing expenses, which exclude share-based competition, remained stable at 76.9% compared to 76.7% a year ago. Research and development expenses were $38.8 million, representing a decrease of 21.7% year over year, primarily driven by our more selective decisions regarding our R&D initiatives. As a percentage of total revenue, no gap R&D expenses, which exclude share-based compensation, increased from 3.7% to 5.1% a year ago. General and Administrative Expenses were $36.4 million, representing a decrease of 24.7% year-over-year, primarily due to decreases in share-based compensation on office expenses. As a percentage of total revenue, non-GAAP G&A expenses, which excluded share-based compensation, decreased to 3% from 4% a year ago.
Speaker Change: Which excludes share based compensation remained stable at 76, 9% compared to 76, 7% a year ago.
Speaker Change: Research and development expenses was 38.8 million, representing a decrease of 21, 7% year over year.
Primarily driven by our more selective decisions regarding our R&D initiatives as a percentage of total revenue.
Speaker Change: non-GAAP R&D expenses, which excludes share based compensation.
Speaker Change: Raised from three 7% from five 1% a year ago.
General and administrative expenses was $36 4 million, representing a decrease of 24, 7% year over year.
Speaker Change: Primarily due to decreases in share based compensation and office expenses.
Speaker Change: As a percentage of total revenue non-GAAP, G&A expenses, which excluded share based compensation decreased two 3% from 4% year ago a year ago.
Dong Xie: Net income was $14.6 million, including share-based composition. Adjusted net income was $31.9 million, representing an adjusted net margin of 3.4% during the quarter. Basic and diluted net income per share will be RMB 0.09 during the quarter. Adjusted basic and diluted net income per share will be RMB 0.19 during the quarter. Turning to our balance sheet as of March 31st, 2024. Our company held $1,149.9 million in cash and cash equivalents and short-term investments, compared to 930.6 million as of June 30, 2023.
Net income was 14 6 million.
Speaker Change: Excluding share based compensation adjusted net income was 31 9 million, representing an adjusted net margin of 3.4% during the quarter.
Speaker Change: Basic and diluted net income per share were RMB 0.09 during the quarter adjusted basic and diluted net income per share will.
Speaker Change: Is there a point Montana during the quarter.
Speaker Change: Turning to our balance sheet as.
Speaker Change: As of March 31st.
Speaker Change: 20 to 24 hour company House 1000 on 149.9 billion in cash and cash equivalents and short term investments.
Parents with 936 million as of June 32023.
Dong Xie: Finally, I want to provide some color on our art loop. For the fourth quarter of fiscal year 2024, which ends on June 30, 2024, we expect revenues to be between $900 million and $930 million, representing a year-over-year increase of between 8.7% and 12.3%. These projections take into consideration the current market conditions prevailing in the industry. During the quarter, while we diligently monitored our learning business and focused on maintaining profitability, we strategically allocated our cash flow into new initiatives with our test and scale approach, ensuring the creation of enduring value for our shareholders. Moving forward, our strategic trajectory will continue to be guided by our commitment to sustainable and profitable growth. That concludes my prepared remarks. Operator, let's open up the call for questions. Thank you.
Speaker Change: Finally, I want to provide some color on our outlook for.
Speaker Change: For the fourth quarter of fiscal year, 'twenty 'twenty, four which ends on June 30, 'twenty to 'twenty four weeks.
Speaker Change: We expect revenues to be between 900 million on demand or in a 30 minute representing a year over year increase of between eight 7% and 12, 3%.
Speaker Change: This projection takes into consideration the current market conditions prevailing in the industry.
Speaker Change: During the quarter, while we diligently monitor our learning business and focused on maintaining profitability.
Speaker Change: Tragically allocated power cash flow into new initiatives with our test and scale approach.
Speaker Change: Ensuring the creation of enduring value for our shareholders moving forward.
Speaker Change: Strategy trajectory, there continue to be guided by our commitment to sustainable and profitable growth.
Speaker Change: That concludes my prepared remarks, operator, that's spoken off the call for questions. Thank you.
Speaker Change: Thank you.
Unknown Executive: We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the key. If, at any time, your question has been addressed and you would like to withdraw your question, please press star then two. While asking a question in Chinese, please translate your question into English for the convenience of everyone on the call. Please ask one question at a time. We will wait momentarily to assemble our roster. Our first question is from the line of Steve Silver from Argus. Please go ahead.
Speaker Change: We will now begin the question and answer session.
Speaker Change: Anyone who wishes to ask a question you May press star and one on your Touchtone phone.
Speaker Change: If youre using a speakerphone please pick up your handset before pressing the keys.
Speaker Change: If any time your question has been addressed and you would like to withdraw your question.
Speaker Change: Please press Star then two.
Speaker Change: But asking a question in Chinese please translate your question in English for the convenience of everyone on the call.
Speaker Change: Please ask one question at a time.
Speaker Change: We will wait momentarily.
Speaker Change: [noise] assembler of Austria.
Speaker Change: Our first question is from the line of tea.
Speaker Change: <unk> Silva from Argos. Please go ahead.
Hello, and thank you operator, and thanks for taking the questions.
Speaker Change: My question is given the economic challenges being seen in China, right now and the continued strength and growth of Qantas things balance sheet.
Speaker Change #100: I'm just wondering if there's an opportunity to potentially accelerate the expansion of the e-commerce business offerings, whether it really just take time more than money to build scale in order to introduce new offerings more quickly.
Peng Li: Okay, thank you for your question. I will pick the question I will answer in Chinese, and Leah will translate for me. What we have noticed is that we are already serving a huge group of middle-aged people, or the silver-haired group, which is a huge potential.
Speaker Change #102: Okay sounds good question I'll kick the the question I will answer in Chinese on the deal we will translate for me.
Speaker Change #101: Uh huh.
Speaker Change #103: Just a woman to eat all those sure well known even that food to go part now the two long answering cheap, whereas all your thoughts from Cheetah Jude Auto <unk> Shandy.
Peng Li: We have already recognized the great potential of the buying power of the silver cohort, which we are already serving.
Speaker Change #104: We have already recognized as a great potential off the buying power of the silver cohort, which we are already selling.
Peng Li: ?????????????,????????????,???????????????????
Speaker Change #104: Somebody a usual sure either one or two.
Speaker Change #104: So you saw a little bit Chinchy Shanghai until the change you know I'm not sure you're all pumped out the door peaches that'd been either fashion. The early adulthood, So you've got a whole need cheap.
Leah Guo: Compared to the newborns in China, clearly, this silver cohort represents a larger population, and this trend will continue for the next 30 years.
Compare that to the new borns in China Crazy. These silver a cohort is that person.
Speaker Change #105: I agree with your population and this trend will continue for the next 30 years.
Peng Li: As you can see, our asset-debt table is still very healthy. This provides a very good foundation for us to develop new business.
Speaker Change #106: No woman the citizens right Bill I shouldn't say it on the call and I think the way a well known Kyprolis Gilles just the she's only you can figure out how did you do.
Peng Li: Where our strong balance sheet provides us with a solid foundation, we think this is a very good foundation for us to start the new business.
While our strong balance sheet provides with our solid foundation.
Speaker Change #107: Think this is a very good foundation for us to start the new business.
Peng Li: As we all know, to do a good job in a new business, it's not just about having a strong financial background. We also need to have a very deep understanding of the user's needs and behaviors and go through a process of constant trial and error.
Speaker Change #108: So it does not cause me, it's all LG, especially also how you could hinder you talk with unions as usual are towers, all tischer Chanda I'll go crazy on the Hiseq also ready to go you don't hold a huge hole, but you make your fate I'll share with it you go to the U K I P. J do you need to go to.
Speaker Change #109: I'm here with once you should get out of court.
Peng Li: But, as we all know, it not only takes a strong, solid financial foundation to initiate a success in a new business, but we also need to fully understand and comprehend the demands of customers and their buying behaviors, and we need to test and then scale our business model.
So as we all know it can not only takes a strong solid off from initial conversation to initiate a success.
Speaker Change #109: We also need to fully understand and comprehend the demands after posthumous outdoor buying behavior I don't think we need to test on the scale.
Peng Li: We have been observing and discovering the needs of middle-aged people who have been serving us for a long time and providing the appropriate products to meet their needs.
Uh huh.
Speaker Change #110: C. J O you don't actually get any social woman weight Ultra woman Tonks useful, Florida I told me you got to not get into it well means that quite hard because it's patria pomander xuzhou, you've laid out how much is crucial to qigong George Italian the turnkey.
Peng Li: We have been observing and also trying to find the real demand for the silver cohorts which we are serving right now, and we are trying our best to provide products that cater for their demand.
Speaker Change #111: We have been observing and also trying to find it just really didn't mind, often silver cohort, which we are serving right now.
Speaker Change #111: We're trying our best to provide the products that came to a halt their demand.
Peng Li: As you can see, in the past period of time, we have achieved some results in the field of baijiu and health products.
Speaker Change #112: Yeah, $2 or sort of course, you don't actually get that back to la Io, which are sure.
Speaker Change #113: Hollywood Tamkin alumni.
Speaker Change #113: Yeah sure, Josh you're cutting the oxalate jamba to get some cheap.
Peng Li: So you may have already noticed that we have already presented a few results that we can further discuss in terms of the Chinese liquor industry and also the house management sector.
Speaker Change #113: So you may have already noticed that that's what we have already pre downturn a few results that's where he can probably these guys in terms of.
Also in the house management sector.
Peng Li: Next, we want to provide a product of our own brand. This means that it will take a deeper excavation and a longer time. So when there is progress in this area, we will share it with you in time.
Speaker Change #114: I will Miss I hope she's gonna just a woman so they occupy that take the time now to ebay. The Shaw probably she all are concerned with the larger who couldn't Honda you should get so you don't see if I'm at a hotel it would seem that Michelle what it's usually been office.
Peng Li: We are also developing our private legal products, but, of course, these efforts will take more time to deep dive into this sector. When we have more progress, we will be ready to share with you. Okay, that's all for the questions. Thank you.
Speaker Change #115: We are also developing our private label products.
Speaker Change #115: Afterwards, we will take a few points.
I will take more time to teach plowed into this sector.
Speaker Change #115: We have more progress when it would be wrong as I like to share with you.
Peng Li: Okay, that's all for the questions. Thank you. Thank you. Thank you. Our next question is from the line of Howard Halpern from Taglich Brothers, please.
Speaker Change #116: Okay. That's all for the questions. Thank you.
Speaker Change #117: Thank you.
Speaker Change #117: Yes.
Speaker Change #117: Thank you.
Unknown Executive: Our next question is from the line of Howard Halpern from Taglich Brothers. Please go ahead. Congratulations on a productive quarter, and
Speaker Change #118: Our next question is from the line of Hollywood Hilton from baggage brothers. Please go ahead.
Unknown Executive: Thank you, Howard. I'll take the next question.
Hollywood Hilton: Well congratulations on a productive quarter and are opening of your first Oh.
Speaker Change #120: All fine education from Kelly services.
Hollywood Hilton: That's where my question comes in will you be expanding the offline education services of Kelly education over the next.
Hollywood Hilton: A couple of years.
Hollywood Hilton: Hum.
Unknown Executive: Yeah, actually, we continuously assess the opportunities to enhance our service offerings and meet the evolving needs of our students, and for college, that is, local Hong Kong students. While our primary focus has been on online learning, we also recognize the value of offline learning in certain scenarios to consider the needs of local students, the local market characteristics, and the features of the local market. The recent opening of our inaugural offline school shows that we are actually actively exploring avenues to expand our offline presence.
However, I would take this question.
Speaker Change #121: Yeah, actually we continuously assess the opportunities to enhance our service offerings and meet the evolving needs of our students until call. It that is the local Hong Kong students, but our primary focus has been on our learning.
Speaker Change #121: We also recognize the value of offline learning its 13th scenarios to.
To consider the needs of the local students in the local market.
Speaker Change #121: Kind of the kind of students just the features of the local market.
Speaker Change #121: The recent opening of our Oh, Kara offline school well it shows that we are actually actively.
Speaker Change #122: Actively exploring avenues to expand our offline practice.
Unknown Executive: This milestone marks a significant step forward in our commitment to providing holistic learning experiences that cater to diverse learning preferences and needs, especially with the support of our business partners from the local market. And also, I think we are continuously making every effort we can to serve the local actual needs of our customers. For college, I think not only does it perform well online, but I also think we may see new opportunities offline.
Speaker Change #122: This milestone marks a significant step.
Speaker Change #123: Forward in our commitment.
Speaker Change #123: To.
Speaker Change #123: Providing holistic learning experiences that caters to a diverse learning preferences and needs, especially with the support of our Piedmont business partners from the local market and also I think be a continuously.
Speaker Change #123: We'll take every actress became due to well serve the local actual needs of our customers.
Kelly: So Kelly I think not only our it performs well in all along.
Kelly: But also I think we may see new opportunities either offline. So they leave you a visit to that yeah.
Unknown Executive: So we will do that. Thank you. Keep up the great work. Thank you. The next question is from the line of Hunter Diamond.
Speaker Change #124: Alright, Thank you keep up the great work.
Speaker Change #124: Okay.
Speaker Change #125: Thank you.
Unknown Executive: The next question is from the line of Hunter Diamond from Diamond Equity Research. Please go ahead.
Speaker Change #125: The next question is from the line of Hunter Diamond from Diamond Equity Research. Please go ahead.
Speaker Change #125: Okay.
Hunter Louis Diamond: Hi, everyone. So in the recent quarters you emphasized the application of AI technology and other AI related areas can you explain how this will impact your offerings and Additionally, you know how it might impact your financials in the long run for instance, the course offerings or cost reductions.
Speaker Change #125: Yeah.
Speaker Change #125: Okay.
Peng Li: Okay, I'll take the question. We have integrated AI into our online learning platform for a long time. This is a strategic decision.
Speaker Change #127: Okay I'll take the question.
Speaker Change #125:
Speaker Change #128: The woman she's really June.
So she's done, let's say a woman the.
Speaker Change #129: If that answers your perpetual Centanni, Russia deal up, especially you saw tonnage is trying to do it yourself.
Peng Li: We have been using and integrating AI technology into our online learning platform. This is one of our strategic moves.
Speaker Change #130: We have been using and integrating technology into our online learning platform. This is one of our strategic moves.
Peng Li: We are using AI to improve the user's learning experience and platform efficiency.
Speaker Change #131: Oh sure Yeah, it's usually or who the XI Qi, yeah, Hello woman. So sundar I saw it right now we use AI to optimize our platform see efficiency and also user experience.
Peng Li: Right now, we use AI to optimize our platform's efficiency and also user experience.
Peng Li: First of all, AI can make every student's learning process more personalized.
Speaker Change #132: So Santa Ana and goes all of them are tissue Oh, My God, She isn't that particularly since you don't take a courtroom from each other because you work for.
Peng Li: First of all, AI allows us to personalize each learner's learning journey.
Speaker Change #132: First of all any iron allows us to personal lines each each learners learning journey.
Peng Li: We can provide customized advice and a self-adapted learning path based on their advantages, disadvantages, and learning preferences.
Speaker Change #133: Well I'm. Okay can you tell me the took a usually a sure. What's your just your heart to cheapen hard I shouldn't get into their U K e-commerce, especially unless you're just waiting.
Peng Li: We can offer tailored recommendations and adaptive learning paths based on their individual strengths and weaknesses and learning preferences.
We can offer tailored recommendations and adaptive learning parts based on their individual strengths.
Speaker Change #133: Since I'm learning preferences.
Peng Li: So, in this way, it can significantly improve the degree of participation of students and improve their learning performance.
Speaker Change #134: So he didn't fall sure Christian.
Speaker Change #135: I'll shoot and does how you tuned to P. J.
Peng Li: This approach can boost engagement and improve learning outcomes.
Speaker Change #136: So did you approach them.
Speaker Change #136: Boost engagement improve learning outcomes.
Peng Li: In addition, AI plays an important role in content supervision and quality assurance.
Speaker Change #136: How do you mind, that's I think the name of Jim glass, which are down, but I don't know if I would often dwell in Sweden. In addition.
Peng Li: In addition, AI plays a crucial role in content regulation and quality assurance.
Speaker Change #136: A crucial role in the content.
From a quality of assurance.
Unknown Executive: Patrick McCann, Hunter Diamond, Dong Xie, Peng Li, Leah Guo, Quantasing Group, Patrick McCann, Dong Xie, Peng Li, Leah Guo, Quantasing Group,
Speaker Change #136: Clip onto them, it's usually always tell the genco hooking gook, and that's all Oh, gosh, I'm watching him to introducing yourself.
Speaker Change #137: When you get your ball so is it possible for a woman she colleague Charlie Pelton, finding a little woman dynamic because your CDR equal, especially in Nevada that can help us.
Peng Li: It can help us to efficiently monitor and assess the relevance, accuracy, and effectiveness of the content available on our platform, and this also ensures that it meets the highest educational standards and reflects the latest developments in each area.
Speaker Change #138: Two we monitor.
Speaker Change #138: As I assess the rack.
Speaker Change #139: <unk> accuracy and effectiveness of the content available on our Python and <unk>.
Speaker Change #139: There's also insurance that's it moved the highest educational standards and reflects the latest development in each area.
Peng Li: From a financial point of view, we estimate that there will be some positive results in the long run.
Speaker Change #140: So I'm, sorry, I wish I was out with a well known could you tell me on I just wonder can you. Please yeah did you get from Google.
Peng Li: In terms of the financial perspective, we anticipate several positive outcomes in the long run.
Speaker Change #141: In terms of the financial perspective, we anticipate several positive comps in the long run.
Peng Li: First of all, AI-driven efficiency measures can help us save costs by simplifying operations and optimizing resources.
Speaker Change #141: So actually I'm not so sure as you don't have a good shot at what should or shouldn't create homewood channel How're you.
Speaker Change #141: See you in New York Life enrollment do you tell them, but first of all for implementing driven efficiency measures is expected to lead to cost savings through a streamlined operation.
Peng Li: First of all, implementing AI-driven efficiency measures is expected to lead to cost savings through streamlined operations and resource optimization.
Speaker Change #141: Optimization.
Peng Li: Second, AI-driven personalization brings a better user experience. It should promote our users' participation and memory to be further improved. In the end, it is helpful for revenue growth.
Speaker Change #142: Just sort of ask what you don't want to do them because you don't want that either God don't want yet either.
Speaker Change #142: What we don't they don't hold a tiny dog allusion to keep with the tea golf. So I'm not so sure you until you chose them down.
Peng Li: Second, the enhanced user experience resulting from AI-powered personalization is likely to drive increased user engagement and retention, ultimately contributing to revenue growth.
Speaker Change #143: I can tell you how to user experience, resulting from the power of personalization is likely to drive increased user engagement and retention ultimately contributing to revenue growth okay.
Peng Li: Okay, that's all for the questions. Thank you. Thank you. Our next question is from
Speaker Change #144: Okay. That's all for the questions and thank you.
Speaker Change #144: Okay.
Speaker Change #145: Thank you.
Unknown Executive: Our next question is from the line of Michael Kopinski from Noble Capital Markets. Please go ahead. Thank you for taking the questions. Can you talk a little bit?
Speaker Change #146: Our next question is from the line of Michael Coe Pinsky from Noble capital markets. Please go ahead.
Speaker Change #147: Thank you for taking the questions can you talk a little bit you've talked a little bit about some of your new initiatives can you talk about how you plan to build brand strength and our awareness for your private label products.
Peng Li: Yeah, thank you for the question. I think, first of all, we are committed to ensuring that our private label products reflect our brand values and meet the highest standards of quality, reliability, and innovation. That's all for our users. Our goal is to consistently deliver exceptional products that foster trust and loyalty among our customers. And in addition, we recognize the importance of effective marketing and communication strategies to drive brand awareness. We leverage a combination of digital marketing channels, social media platforms, influencer partnerships, and focused advertising campaigns. We have also built solid infrastructure, and we have accumulated massive operating experience in this area. And this approach allows us to reach our target audience and customers and showcase the unique value proposition of our private label product. So that's all we are doing our most effort recently.
Speaker Change #148: Yeah. Thank you for the question.
Speaker Change #149: I think first of all we are committed to ensuring that our private label products.
Speaker Change #149: Reflect our brand values and meet the highest standards of quality reliability and innovation, that's all for our users.
Speaker Change #149: Our goal is to consistently deliver exceptional products that well he.
Speaker Change #150: He fostered trough on the law.
Speaker Change #150: Among our customers.
In addition.
Speaker Change #150: We recognize the importance of you talked to your marketing and communication.
Speaker Change #150: Our strategy is to drive brand awareness.
Speaker Change #150: Average a combination of digital marketing channels.
Social media platforms Influencer partnerships.
Speaker Change #150: Focused advertising campaign, which we have also built well.
Speaker Change #150: Solid infrastructure on how the.
Speaker Change #150: The accumulated massive operating expenses experienced in this area and this approach allows us to reach our target audience unpopular and showcase the unique value proposition of our private label products.
Speaker Change #150: That's all.
Speaker Change #150: Doing our most.
Speaker Change #151: Office recently.
Peng Li: And also for customer engagement and feedback. I think they are integral components of our brand building efforts. By actively soliciting and responding to feedback, we demonstrate our commitment to customer satisfaction and the continuous improvement of our business. And this is a data-driven process, I think. And also, by doing so, we further enhance brand perception and loyalty as we continue to execute our brand building initiatives. We remain agile and responsive to evolving market trends, and we will monitor data and customer preferences.
Speaker Change #151: And also for customer engagement and feedback I think the.
Speaker Change #151: The integral components of our brand building efforts.
Speaker Change #151: But actively soliciting on responding to feedback.
Speaker Change #151: Demonstrate our commitment to customer satisfaction.
Speaker Change #151: Continuous improvement of our business I mean, this is a data driven process. So I think and also by doing so.
Speaker Change #151: Hum.
Ron: Ron perception on the loyalty.
Ron: We continue to execute our brand building initiatives.
Ron: Remove ical unresponsive to evolving market change.
Ron: That'd be the monitor the data on customer preferences. Our goal is to establish our private label products as trough cheat on preferred.
Peng Li: Our goal is to establish our private label products as trusted and preferred choices within their respective categories, which will ultimately drive long-term brand strength and success and also our long-term value for both our customers and shareholders. Thank you.
Ron: It is within their respective categories.
Ron: View ultimately drive long term brand strength and success and also our long term value to both those to our customers and shareholders.
Ron: King.
Speaker Change #153: Thank you for the color.
Speaker Change #154: Thank you.
Speaker Change #155: Ladies and gentlemen.
Unknown Executive: If you wish to ask a question, you may press star and one on your touchtone phone. If at any moment your question has been addressed, you may press star and two to withdraw your question. Please ask one question at a time. The next question comes from the line of Jackson from Kehlong Research.
Speaker Change #156: If you wish to ask a question you May press star and one on your Touchtone phone.
Speaker Change #157: At any moment to your question has been addressed you May press star and two to withdraw your question.
Speaker Change #157: Please ask one question at a time.
liner Jackson: The next question comes from the liner Jackson from Standalone Greek research.
Please go ahead.
liner Jackson: Okay.
Unknown Executive: Congratulations on a strong quarter. I'm Jackson from Golonghui Zhongkai Yanjiu Yuan.
Speaker Change #159: Congratulations on a strong quarter Jackson Bonkers Cronkite you enjoyed that.
Unknown Executive: On behalf of Golonghui's investors, I would like to ask our management a question on the registered users and the quarterly revenue. Registered users for Quantasing reached $121 million with significant growth in quarterly revenue. What would be the outlook for future registered users, and could you give us some comment on the future quarterly revenue? We look forward to the future performance of the company. Thank you.
Speaker Change #160: I would be happy to go along with it Masters I was like Oscar.
Speaker Change #161: Sure the registered users and the cool thing about it.
Speaker Change #162: They actually use or for partners, we actually thought about 21 million with significant growth quickly grabbing what.
Speaker Change #163: It would be the outlook for future of registered users and could you give us some color on me.
Speaker Change #163: On future calls.
Speaker Change #164: We look forward for the future performance of the Compass.
Speaker Change #164: Thanks.
Peng Li: Thank you for the question. First, Quantasing is a relatively new company. We just launched our business in July 2019. So during the past nearly five years of operation, we have experienced rapid growth in this unique interest based on a learning market for adults. So most of our adults are middle-aged and elderly people in China, which is a growing population.
Speaker Change #165: Well. Thank you for your question I think first quantity is a is a relatively new company, maybe just a long travel business in July 2019, so due to the past nearly five years of operation we have experienced a rapid growth in this unique interests.
Speaker Change #165: The only new market for adults. So most of all we're about the middle aged and elderly people in China, which is the beryllium population. The demographic. So that's why during the past five years to be how you experienced rapid growth both for the number of registered users and also.
Peng Li: So that's why during the past five years, we have experienced a rapid growth, both for the number of strategy users and also for the revenue. So I think in the future, because our aim is to provide quality services, that is the online learning and also other services, and also maybe like the private products, we will develop and launch and provide the quality products to our customers. So based on this.
Speaker Change #165: The revenue.
Speaker Change #165: So I think in the future because of the.
Speaker Change #165: Our aim is to provide quality.
Speaker Change #165: Services that is on our learning and also other services and also maybe.
Speaker Change #165: Like the private label products, maybe provide the maybe that develop in the long term provided the quality products to our customers.
Speaker Change #165: So based on this.
Peng Li: I think we have set up a very good start for our value delivery and also for revenue growth in the future by leveraging our capability for cross-selling among the courses, among the online courses, and also for our extension of the value of the existing customers. Some of them may be paid users, and some of them may be just registered users. So we have the great potential to extend the lifetime value of our existing users.
Speaker Change #165: <unk> solid and a larger user base I think that we have set up a very good start for our value delivery and also for the revenue growth you know future bilateral reaching our capability.
Speaker Change #165: To fulfill the cross selling.
Among the causes among the online courses and also for our extension of the value of the executive team.
Speaker Change #165: Our customers are some of them maybe the paid users and some of them maybe just registered users. So we have great potential to extend the lifetime value of our existing users.
Peng Li: So I think this is a real start for revenue growth and for platform growth in the future because we have a solid base of customers and also a solid base of infrastructure, and technology. For example, the live stream, live, Live Streaming E-Commerce Platform, and Live Streaming Online Cost Delivery Platform. So all of these set up a solid foundation for the customer's value in the future, both for customers themselves and for the platform. Thank you. Okay, thank you.
Speaker Change #165: I think this is.
Speaker Change #165: A real dark pool.
Speaker Change #166: The vote for the revenue growth for the platform growth in the future.
Speaker Change #166: We have a solid base of customers and also a solid base of the infrastructure the technology.
Speaker Change #166: For example, the live stream live.
Speaker Change #166: A lot of screaming ecommerce platform live streaming online course delivery and platform. So all of this is that a solid base for the costumers are value in the future both for customers themselves on the platform.
Speaker Change #167: Thank you.
Speaker Change #168: Okay. Thank you.
Speaker Change #169: Thank you.
Unknown Executive: Our next question is from the line of B.J. Cook from Singular Research. Please go ahead. Thank you. I was just curious.
Speaker Change #170: Our next question is.
Speaker Change #171: From the line of B J Cook from singular research. Please go ahead.
Speaker Change #170: Yeah.
Speaker Change #172: Thank you.
Speaker Change #173: Just curious if you.
Speaker Change #174: Have any plans to deploy cash on the balance sheet.
Speaker Change #174: Thank you.
Unknown Executive: Yeah, actually, I think considering the macro environment and also business expansion in the future, we should have a balance sheet to set up a solid base for our expansion. For example, we are considering and developing our private label products, we will do some marketing, and we will do some product and supply chain development. That means we may have some assets, and we may have some we have to deploy some of our balance sheet.
Speaker Change #175: Yeah, actually I think considering the macro environment and also the business expansion in the future we should how our house of the balance sheet.
Speaker Change #175: To set up a solid place for our expansion for example, they are actually they are considering developing our private label products on the V view to some marketing and some product and supply chain.
Speaker Change #175: It meant that means we may have some asset I mean, they may have some.
Speaker Change #175: So they have to deploy some of our balance sheet for example, the cash well in the new area too.
Unknown Executive: For example, the cash in the new area to increase our new initiatives, so that is maybe one of [inaudible] for some maybe share repurchase for our capital market activities, and also we are considering, maybe in the next following period, we will discuss with the board some new initiatives for cash management. So, I think during the past five years of operating, we always adopted a very conservative methodology for our business goals, so that during that time, we have achieved sustainable and profitable growth in recent years.
The increase in our new initiatives, so that that that that is maybe one of the oh.
Speaker Change #175: One way to deploy the cash.
Speaker Change #175: Which is the middle part of the assets all of our balance sheet and also we are actually are considering.
Speaker Change #175: For some maybe a share repurchase for our.
Speaker Change #175: Capital markets are.
Speaker Change #175: Activities and also they are considering on maybe.
Speaker Change #175: We view in the next.
Speaker Change #175: Falling or pure weird.
Speaker Change #175: Cost me the board for some new initiatives for the cash management. So I think oh, the during the past five years of all creating a we always adopt a very conservative.
Speaker Change #175: <unk> methodology for our piece is gross flows out during the past the time, we have achieved a sustainable.
Speaker Change #175: So it's attainable on a profitable growth.
Unknown Executive: So, I think that's the business methodology and principle for our operation. So, I think we will do our best to try to make the most of the balance sheet assets to achieve a greater value for our shareholders.
Speaker Change #175: The recent years, so I think that's the.
Speaker Change #175: This methodology on a principle for our all our operation. So I think I actually leave you do our best to try to make the most of the use of the balance sheet assets.
Unknown Executive: Thank you. Thank you. Thank you.
Speaker Change #175: To achieve a greater value for our shareholders.
Speaker Change #176: Thank you.
Thank you.
Speaker Change #176: Thank you.
Speaker Change #176: Yeah.
Unknown Executive: Ladies and gentlemen, if you have any further questions at this moment, please press star and one on your touchtone phone. As there are no further questions, I would now like to hand the conference back to the management for closing remarks.
Speaker Change #177: Ladies and gentlemen, if you have any further questions at this moment. Please press star one on your Touchtone phone.
Speaker Change #178: As there are no further questions I would now like to hand, the conference back to the management for closing remarks.
Unknown Executive: Thank you for joining our call today. If you have any further questions, please feel free to contact us or submit a request through our IR website. We look forward to speaking with everyone on our next call. Have a good day.
Thank you for joining our call today, if you have any further questions. Please feel free to contact us or something in that request through.
Speaker Change #179: I am upset when look forward to speaking with everyone on our next call have a good day.
Speaker Change #179: Okay.
Speaker Change #179: [music].
unknown: ?? ?? ?? ?? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ???
Speaker Change #179: Yeah.
Speaker Change #179: [music].
Yes.
Speaker Change #179: [music].
Speaker Change #179: Yeah.
Speaker Change #179: Yeah.
Speaker Change #179: [music].
Speaker Change #179: Yes.
[music].