Q2 2024 Gaotu Techedu Inc Earnings Call

Speaker Change: Ladies and gentlemen, thank you for standing by, and welcome to the GAL2 Tech EDU, second quarter 2024 earnings conference call.

Unknown Executive: and welcome to the Gao Tzu Tech EDU second quarter 2024 earnings conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero.

Speaker Change: All participants will be in a list and only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero.

Unknown Executive: After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on a touch-tone phone. To withdraw your question, please press star, then two. Please note this event is being recorded.

Speaker Change: After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star than one on a text on phone. To withdraw your question, please press star than two.

Katherine Chen: I would now like to turn the conference over to Ms. Katherine Chen, head of Investor Relations. Please go ahead. My name is Katherine, and I will host the earnings call today. Gou Tzu's earnings release for the quarter was distributed earlier and is available on the company's iOS site and IR.Gou Tzu Tech EDU, as well as through PR Newspaper Services. Following their prepared remarks, we'll open the floor to questions from analysts.

Speaker Change: Please note, this event is being recorded.

Speaker Change: I would now like to turn the conference over to Miss Katherine Chen, Head of Investor Relations. Please go ahead.

Katherine Chen: Thank you, operator, good evening everyone. Thank you for joining us at the coldest 24 early conference call. My name is Katherine, and I'll help host the early call today.

Katherine Chen: Welcome early three leads for the quarter which succeeded earlier and is available on the company higher website at IR.go2.com

Speaker Change: as well as to be on your service.

Speaker Change: Going to the call with me tonight from Gal-Tao Senior Management, it's Mr. Larry Chen, Gal-Tao's Founder, Chairman and Chief Executive Officer

Speaker Change: and meet Shannon Chen, go to Chief Financial Officer.

Speaker Change: Sarah will first provide a business highlight for the quarter, and then afterwards, Shannon will discuss our financial performance in more detail.

Speaker Change: following their particular remark will open the floor to patches from analysts.

Katherine Chen: Before we begin, I'd like to remind you that this conference call will contain four-looking statements made under the same cover position of the US-Pilot Security Education Reform Act of 1995. This four-looking statement obeys about management's current beliefs and expectations, as well as the current market and operating conditions. And they involve no risk and certainty and other factors, all of which are difficult to predict, and many of which are beyond the complete control. And they cause a company's actual results, performance, or achievement to differ materially from those contained in any forward-looking statement. For the information regarding this and other risks, this included in the company's public following with the USFEC.

Speaker Change: Before we begin, I'd like to remind you that this conference call will contain full-on-looking statements, made under the same proper provision of the new S-Type of Security and Education Reform Act of 1995.

Speaker Change: This forward-looking statement, obey of how management's current, belief and expectation, as well as the current markets and operating conditions.

Speaker Change: and they look no or no risk.

Speaker Change: and Serpentine and other factors all of which are difficult to predict and the many of which are beyond the continuous control and may cause the continuous actual results performance or achievement to these from those containing in any forward look at space.

Speaker Change: For the information regarding this and other risks, this included in the Communist Party's following with the U.S.F.E.C.

Katherine Chen: The company does not undertake any obligations to update any four-looking statement except as required under a free follow.

Speaker Change: The company does not undertake any obligation to update and follow through things, except as required under a free follow.

Katherine Chen: During today's call, management will also discuss certain non-GAAP measures for comparison purposes only. For a definition of non-GAAP financial measures and reconciliation of GAAP non-GAAP financial results, please refer to our second quarter early release published earlier today.

Speaker Change: During today's call, management will also discuss certain non-get measures for comparison purpose only.

Speaker Change: for our definition of non-gap financial measures and reconciliation of Gap's non-gap financial results. Please refer to our second-quarter early release published earlier today.

Katherine Chen: As a reminder, this conference is being recorded. In addition, a live and archived webcast of this conference call will be available on the Office IR website.

Speaker Change: As a reminder, this conference is being recorded. In addition, a live and archives webcast of this conference call will be available on the Office of IAR website.

Larry: It is now my pleasure to introduce our founder, chairman. and Chief Executive Officer, Larry.

Speaker Change: It is now my pleasure to introduce our founder, Chairman and Chief Executive Officer, Narei. Narei, please.

Larry: Larry, please. Good evening and good morning, everyone. Thank you for joining us on GoTo's second quarter of this year to the 24-earning conference call. I would like to take this opportunity to express my gratitude to all of you for your interest in and support of GoTo. Before I start, I would like to remind everyone that all financial figures discussed today are quoted in R&B unless they did otherwise. We achieved the encouraging results in the second quarter with a net revenue of increasing 43.6% of the year to 1.0 billion, reflecting strong extended reaching growth momentum. Our growth billions grew by a substantial 87.4% of the year to 1.7 billion, which not only exceeded the market expectations but also the growth potential in the education sector.

Speaker Change: For the evening and for the morning, I am the wife

Narei: Thank you for joining us on Gal Tooth Effect and Quarter of Bizk, Bizk, Ayr, to Sun and 24-Earning, Coven Call I would like to take this opportunity to express my gratitude to all of you for your interest in and support of Gal Tooth

Speaker Change: Before I start, I would like to remind everyone that all financial figures discussed today are quoted in the IMB and listed in the web

Speaker Change: We achieve the encouraging results in the second quarter with the net revenue, increasing 43.6% of the year to 1.0 billion, reflecting strong, accelerating growth momentum.

Speaker Change: Our growth experience grew by a substantial 87.4% of the year to 1.7 billion, which not only see the market expectations, but also the growth potential in the education sector.

Larry: Thanks to our non-term investment in diversified and proprietary channels, we maintained the industry-leading customer acquisition efficiency while serving robust market demand. During the quarter, our net of reaching cash inflow reached 3.86.2 million. Our cash reserves remained strong, totaling 4.1 billion in cash, cash equivalent, restricted cash, and the short-term and long-term investment, which is 361.3 million higher than at the same point in time last year. This ongoing improvement in our operational efficiency is the result of our consistent folks on business, finance, and commitment to our educational aspirations. As of June 30th to 724, our deferred revenue reached 1.6 billion, representing a 71.5% increase from the same point in time last year, ensuring robust support for our continued growth in the second half of the year.

Speaker Change: Thanks to our non-term investments in diversified and proprietary channels, we maintain the industry leading customer acquisition efficiency while serving robust market demand.

Speaker Change: Dearing of the quarter, our night of reaching cash in blow reached at 300 and 80's sake of 0.2 million

Speaker Change: [inaudible] . . . . .

Speaker Change: This ongoing improvement, our operational efficiency is the result of our consistent focus on business high-risk and commitment to our educational aspirations.

Speaker Change: As of a dream of 30, to sound on the 24th, our deeper, the revenue reached a 1.6-pinit represents a 71.5 percent increase from the same point in time last year, ensuring robust support for our continued growth.

Larry: I will now provide an update on the progress we have achieved in the quarter. We've consistently recognized that the learning services and the teaching quantity forms a better look of our color complex. Over the past few months, we have a significantly enhanced learning experience and outcome of the four students through continuous optimization and refinement of course content alongside the strategic strengthening of our instructors and the tutors, expertise, and qualifications, for instance. Within our educational services for college students, we have increased the proportion of our tutors and the content development team, the coding master's degree. They are by advancing our overall professional, procurement, and teaching quality.

Speaker Change: in the fake and the half of it's ears.

Speaker Change: I will now provide an update on the progress we have achieved in the quarter.

Speaker Change: With a consistent recognize that the learning services on the teaching quantitative floor is a bad rule of our power content.

Speaker Change: Over the past few months, we have a significant delay in hands learning the bearings and outcome of the four students through the continuous optimization and refinement of course content alongside the strategic strengthening of our instructors and the tutors.

Speaker Change: Every machine is on the qualification.

Speaker Change: for instance, within our educational services for college students, we have increased the propulsion of our tutors and the content of the development team, the holding master's degree.

Speaker Change: thereby innovating our overall professional and human and teaching quality.

Larry: In our non-exemic tutoring services, we have not only bolstered our team by raising the percentage of tutors from the top ranked universities, but also sufficiently refined the classroom activities and the course design based on student feedback and end-of-trade insights. This has boosted greater student engagement, fostering their comprehensive capabilities in innovation, problem solving and self-directed learning. To address individualized learning needs, we have introduced the innovative teaching models and flexible course structures that have significantly boosted student engagement and self-defection. This approach has, in turn, contributed to the overall health of our business. During the quarter, we observed a steady increase in retention rates for our traditional learning services, with a particularly notable uptick among new enrollment.

Speaker Change: and our Nan Executive Tutorial Services, we have not only post-turd, our team by reading the percentage of the tutors from top ranked universities.

Speaker Change: But also, ladies and gentlemen, we find the classroom activities and the core of design based on students feedback and industry insights.

Speaker Change: These had put paid greater students in government, both to rein their comprehensive capability to get innovation, problem solving and the self-directed learning.

Speaker Change: To address indivrientized learning needs, we have introduced the innovative teaching models and flexible costs, structures that have a same need to study, still then the engagement and the satisfaction

Speaker Change: This approach had the intern, concluded to the overall health of our business.

Speaker Change: During the quarter, we observed a steady increase in retention rates for our traditional learning services with a particularly notable uptake among new environments.

Larry: These efforts have reinforced our competitive edge within the industry and laid a solid foundation for the effective growth of our business. Looking forward, our strategic priorities will remain focused on refining our educational upgrades, improving our teaching quality, and optimizing the learning experience. Publicterial guidance is a core driving force behind the long-term growth of our company and the education industry at large. At Gao Tu, we have enhanced the professional expertise and the ability of our leading instructors and tutors by refining our incentive and graduation framework to strengthening our organizational culture and expanding our training and feedback mechanism.

Speaker Change: These efforts have a dream for our competitive age with the endotry and the latest Sony, the foundation for the effective growth of our business.

Speaker Change: Looking forward, our strategic practice, we remain focused on refining our educational operating and improving our teaching quality and optimizing the learning as a parent.

Speaker Change: Topicator guidance is the core driving force behind the long-term growth of our company and the education industry at an orange at a gold pool

Speaker Change: We're having enhanced the professional activities and the stability of our leading skin structures and tutors by refining our skin tape and graduation frameworks.

Speaker Change: to drink sending our organizational culture and abandoning our training and a feedback mechanism.

Larry: We have also established a robust recruitment system and made a substantial investment in cultivating new teachers. In the first half of 2024, we formed a strategic partnership with over 60 leading universities across China, engaging in collaborative initiatives such as joint programs and on-campus lecture series. To support new hires, we have implemented programs like mentor, orientation, and a new camera camp to facilitate their simulation to our culture, smooth team integration, and effective transition into teaching roles. These initiatives equate them with the skills and allow the needed to succeed in their role. Moreover, we are actively onboarding seasoned industry professionals with extensive industry experience and maintenance capabilities.

Speaker Change: We have also established a robust recruitment system and made a substantial investment in cultivating new teachers

Speaker Change: In the first half of 2004, we formed strategic partnership with over 60 leading universities across China engaging in collaborative initiatives such as the Joint Programs and Unkind for the Lecture Series.

Speaker Change: to support new hires. We have implemented a program like Mentor Orientation.

Speaker Change: and a new camera time to facilitate their ceremonies, I can lamentation to our culture, some of the team integration and effective translation into teaching roles.

Speaker Change: These Initiatives equate the wisdom skills and the knowledge needed to succeed in their role. Moreover, we are actively onboarding season-endotry professionals with extensive endotry recipients and the main demands can bring the peace.

Larry: Their proven methodologies and the strategic insights are infusing our rapidly expanding business ways, the invaluable expertise and cobbling handsaver perspectives. Going forward, we remain dedicated to cultivating our pen and pull to ensure a solid foundation for sustained and effective growth. While rapidly expanding our business, we have maintained and we remain focused on operational efficiency in terms of customer acquisition. We have for activity increased investment in talent and resources developed a diverse range of acquisition channels with a particular focus on building proprietary channels and private private compose. This strategy not only establish competitive market position for us but also effectively mitigate the risks by fostering closer cross-team collaboration and streamlining operations.

Speaker Change: They approve and messed on the days, and the strategic insights are infielding our drip today, expanding in the areas where the embeddable activity is, and the corporate hand-saverment perspective.

Speaker Change: Go in forward, we remain dedicated to contributing our patentable to ensure a solid foundation for a sustained and effective growth.

Speaker Change: While Repetentate Expelling Hour Bin Nays, we have maintained an un-weboring focus on operational efficiency, in terms of the customer acquisition. We have an activity increase in investment in tenant and resources to develop a diverse range of...

Speaker Change: Acquisition Chen with a particular purpose on building proprietary channels and private private polls.

Speaker Change: This strategy not only is families that come, positive marked the position for us, but also it's practically.

Speaker Change: Medical Data Risk

Speaker Change: by Fostering Closer Cross Team Collaboration and Streamlining Operations. We have a consistent aim in changing the user conversion rates at a high level.

Larry: We have consistently maintained the user conversion rate at a high level. Looking ahead as our enchantments grow and brand recognition in the band, we will continue to leverage the power of positive word of a mouse to further strengthen our brand and drive effective business growth. Drun's 16th mark for the 10th anniversary of a call to the funding of the past decade, we have stated true to our educational aspirations of striving for excellence by carnating the power of artificial intelligence. We are advancing our mission to make the living better and working militantly pursuing our operational goal of fostering student growth through exceptional teachers and the realigning meaningful social value.

Speaker Change: Looking ahead as our enrolments grow and brand recognition in the band, we will continue to leverage the power of positive word of mouth to further address our brand and drive effective

Speaker Change: Drung the 16th mark for the 10th anniversary of a girl towards the family

Speaker Change: of the past, the decades. We have to stay the true to our educational celebrations of striving for existence by harnessing the power of artificial independence.

Speaker Change: We are advancing our mission to make a living better and the work can be the identity pursuing our operational goal of fostering the growth through exceptional teachers and the realigning meaningful social video

Larry: In response to China's evolving demands for talent cultivation, we co-hosted as a second top and not innovative talent collaborative, but cultivating the economic reforming in collaboration with esteemed official organizations, including the Chinese Society of Educational Development of Strategy. This initiative underscores our dedication to advancing the framework and practices essential for nurturing a number of talents in the education sector. According to our internal data, the number of a call to students admitted to the top two Chinese universities in 2024 has seen a further increase from last year, a strong testament to our excellence in cultivating outstanding innovative talent.

Speaker Change: In response to China's evolving demands for talent, cultivation.

Speaker Change: We co-hosted as a second-for-top-and-notch in a debate panel in the collaborative debate, academic autonomy in collaboration with SDM, official organizations, including the Chinese of the Society of Ice-Kitinal, Development of the Graduate.

Speaker Change: This is a new city, and scores our dedication to advancing the framework and the practice of essential for nurturing a number-tave parent in the education sector.

Unknown Executive: and welcome to the Gao Tzu Techedu, 2nd quarter, 2024 Earnings Conference Call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero.

Unknown Executive: and welcome to the Gao Tzu Tech EDU Second Quarter 2024 Earnings Conference Call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero.

Speaker Change: According to our internal data, the number of go-to students that made it to the top two Chinese universities in 2004 had further increase from a national year.

Unknown Executive: After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on a touch-tone phone. To withdraw your question, please press star then two. Please note, this event is being recorded.

Unknown Executive: After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on a touch-tone phone. To withdraw your question, please press star then two. Please note this event is being recorded.

Speaker Change: A strong testament to our excellence in cultivating all of the Indian, innovative, and talented.

Larry: Our success is fundamentally rooted in the trust and the support of our shareholders. We remain steadfastly committed to enhancing shareholder value. As of August 26th, 724, the company had repurchased the strong 7.9 million ideas in aggregate for a total of approximately 27 million US dollars under the existing share repurchase program. Moving forward, we remain committed to prioritizing customer needs and creating lasting value for our shareholders. Thank you very much.

Speaker Change: Our success is fundamentally rooted in the trust and the support of our shareholders. We remain steadfastly committed to enhancing shareholder value.

Katherine Chen: I would now like to turn the conference over to Ms. Katherine Chen, Head of Investor Relations. Please go ahead. My name is Katherine and I will host the Earnings Call today. Gou Tzu's Earnings release for the quarter was distributed earlier and is available on the company's iOS site and IR.Gou Tzu Tech EDU, as well as through PR Newspaper Services. Following their prepared remarks, we'll open the floor to questions from analysts.

Katherine Chen: I would now like to turn the conference over to Ms. Katherine Chen, head of investor relations. Please go ahead. Gao Tzu's early release for the quarter was distributed earlier, and is available on the company's iOS side, at IR.go2.co.uk, as well as the PR Newspaper services.

Speaker Change: As of August of the 26th to sound the 24th, the company had a repurchased...

Speaker Change: Zuoang, the 7.9 media ideas in aggregate for total of approximately 27 media U.S. orders under the existing share repurchase program.

Speaker Change: Moving forward, we remain committed to prioritizing consumer needs and creating lasting video for our shareholders.

Katherine Chen: Joining the call with me tonight from Gao Tzu's senior management is Mr. Larry Chen, Gao Tzu's founder, chairman, and chief executive officer, and Ms. Chen Chen, Gao Tzu's chief financial officer. Larry will first provide the business highlights for the quarter, and then afterwards, Chen will discuss our financial performance in more detail. Following their prepared remarks, we'll open the floor to questions from analysts.

Larry: This is the end of my prepared remarks.

Speaker Change: Thank you very much. This is the end of my prepare the remark. Now, I will pass the call over to our Seattle Shen in to walk you through the financial and operational details of the quarter.

Shannon: Now, I will pass the call over to our CEO for Shannon to walk you through the financial and operational DTUs over-to-counter. Thank you, Larry. And thank everyone for joining our call today. I will now walk you through our operating and financial performance for the second quarter of fiscal year 2024. We kick it off the year with robust growth and successfully carried this momentum into the second quarter. Further scaling our operations, well-delivering results that exceeded our expectations in both revenues and growth buildings. Specifically, net revenues grew 43.6% year-over-year to 1.0 billion. Outpacing the growth rate, we sat in the first quarter by approximately 10 percentage points.

Seattle Shen: Thank you Larry, and thank you everyone for joining our call today.

Seattle Shen: I will now walk you through our operating and financial performance for the second quarter of fiscal year, 2021. We kick out of the year with robots to girls and successfully carried this momentum into the second quarter.

Katherine Chen: Before we begin, I'd like to remind you that this conference call will contain four-looking statements made under the same cover position of the US-Pilot Security Education Reform Act of 1995. This four-looking statement obeys about management's current beliefs and expectations, as well as the current market and operating conditions. And they involve no risk and certainty and other factors, all of which are difficult to predict and many of which are beyond the complete control.

Katherine Chen: Before we begin, I'd like to remind you that this conference call will contain overlooking statements made under the same proper provision of the U.S, private security and education reform act of 1995. This forward-looking statement obeys about management's current beliefs and expectations, as well as the current market and operating condition. And they invoke no unrest, uncertainty, and other factors, all of which are difficult to predict, and many of which are beyond the complete control, and they cause a complete actual result, performance, or achievement to differ materially from those contained in any forward-looking statements.

Seattle Shen: Further scaling our operations, well, delivery results that exceeded our expectations, in both revenues and gas billings.

Katherine Chen: And they cause a company's actual results, performance, or achievement to differ materially from those contained in any four-looking statement. For the information regarding this and other risks, this included in the company's public following with the USFEC. The company does not undertake any obligations to update any four-looking statement except as required under a free follow.

Seattle Shen: This is a claim that revenues grew for this 3.6% year over year to 1.0 billion.

Seattle Shen: I'll be placing the growth rate we set in the first quarter by approximately 10 percentage points.

Shannon: Growth buildings for the first half of the year. Laying a solid foundation for further revenue growth in the second half of the year. These results reflect our ongoing efforts to boost operational efficiency, address market demand, and enhance keeping quality.

Seattle Shen: God's Billings for the first half of the year increased 67.7% to 2.4 billion.

Katherine Chen: For the information regarding this and other risks, this included in the company's public following with the U.S.F.C. The company does not undertake any obligations to update any forward-looking statement, except as required under a free follow. During today's call, management will also discuss certain non-gap measures for comparison purposes only. For a definition of non-gap financial measures and reconciliation of gas non-gap financial results, please refer to our second quarter early-sleeve published earlier today.

Seattle Shen: Lying a solid foundation for further revenue growth in the second half of the year.

Seattle Shen: Please resolve, reflect our ongoing efforts to boost operational efficiency.

Seattle Shen: or Drice Market Design and Nihon Teachings for the moving forward. We will maintain our focus on co-execution business.

Shannon: Moving forward, we will maintain our focus on cooperation business, expand our product offering, attract top talents, and refine operations to catalyze our market opportunities and drive long-term sustainable growth.

Katherine Chen: During today's call, management will also discuss certain non-gap measures for comparison purposes only. For a definition of non-gap financial measures and reconciliation of gas non-gap financial results, please refer to our second quarter early release published earlier today.

Seattle Shen: extends our product offering a track top talent and refine operations to capitalize on market opportunities and drive long-term sustainable growth.

Shannon: Before diving into the results with quarter, I would like to first address the seasonality and the vitality inherent in our online education business. To effectively manage the summer search in demand, we strategically planned and allocating resources a height of time, particularly for teacher recruitment, team training, and customer acquisition channels. Using their typical three to six months back between these investments and revenue recognition, we recommend using the ratio of growth buildings to market expenditure as a key magic to more accurately get customer acquisition efficiency for our online business. During the quarter, we dynamically adjust our investments in marketing activities and customer acquisition channels, which led to better-than-expected growth feelings while ensuring acquisition efficiency, thereby successfully delivering on our goal of effective growth.

Speaker Change: Before diving into the result of this quarter, I would like to first address the seasonality and the mortality inherent in our online education business.

Katherine Chen: As a reminder, this conference is being recorded. In addition, a live and archives webcast of this conference call will be available on the Office IR website.

Katherine Chen: As a reminder, this conference is being recorded. In addition, a live and archives webcast of this conference call will be available on the Office IR website.

Speaker Change: who effectively managed the summer surge in demand with strategically blind and allocated resources a high-up time, particularly for teacher recruitment, team training and customer acquisition channels.

Larry: It is now my pleasure to introduce our founder, Chairman, and Chief Executive Officer, Larry. Larry, please. Good evening and good morning, everyone. Thank you for joining us on GoTo's second quarter of this year to the 24-Earning Conference call. I would like to take this opportunity to express my gratitude to all of you for your interest in and support of GoTo. Before I start, I would like to remind everyone that all financial figures discussed today are quoted in R&B unless they did otherwise.

Larry Chen: It is now my pleasure to introduce our founder, Chairman, and Chief Executive Officer, Larry. Larry, please. Good evening and good morning, everyone. Thank you for joining us on GoTo's second quarter of this year to the 24-Earning Conference call. I would like to take this opportunity to express my gratitude to all of you for your interest in and support of GoTo. Before I start, I would like to remind everyone that all financial figures discussed today are quoted in R&B unless they did otherwise.

Speaker Change: Thanks, there is typical of 3-6 months back between the youth investments in the revenue

Speaker Change: We recommend using the ratio of cross-billing to market expenditure as a key magic to more actually get customer acquisition in efficiency or our online business.

Speaker Change: During the quarter, we dynamically object state our investments in marketing activities and customer acquisition channels.

Larry Chen: We achieved the encouraging results in the second quarter with net revenue, increasing 43.6% of the year to 1.0 billion, reflecting strong, extended reaching growth momentum. Our growth billions grew by a substantial 87.4% of the year to 1.7 billion, which not only exceeded the market expectations, but also the growth potential in the education sector. Thanks to our non-term investments in diversified and proprietary channels, we maintained the industry-leading customer acquisition efficiency while serving robust market demand.

Larry: We achieved the encouraging results in the second quarter with a net revenue of increasing 43.6% of the year to 1.0 billion, reflecting strong extended reaching growth momentum. Our growth billions grew by a substantial 87.4% of the year to 1.7 billion, which not only exceeded the market expectations but also the growth potential in the education sector. Thanks to our non-term investment in diversified and proprietary channels, we maintained the industry leading customer acquisition efficiency while serving robust market demand.

Speaker Change: which led to better than expected cross-plings while ensuring acquisition efficiency.

Speaker Change: thereby successfully delivering on our goal of effective growth.

Shannon: Additionally, since our fiscal quarters do not fully align with the school calendar, the extensive investments made during the summer would span substantially both in the second and third fiscal quarters, impacting our near-term operating profit. We are confident that our strategic investments in summer will drive meaningful growth in student enrollment, further solidify our market position, and boost brand regulation.

Speaker Change: Additionally, since our fiscal quarter do not fully align with the school calendar.

Speaker Change: The extensive investments made during the summer, which spent substantially both in the second and the third fiscal quarters, impacting our near-term operating profit.

Speaker Change: We are confident that our strategic investments in summer will dry meaningful growth in still-than-in-your-moment.

Speaker Change: Further solidify our market position and boost brand regulations.

Shannon: Next, I will walk you through the progress we've made during the quarter. Learning services contributed over 95% of net revenues. Breaking it down, more than 75% of total revenues came from non-academic tutoring services and other traditional learning services, representing an increase of nearly 55% year-over-year. Our new initiatives centered around non-academic tutoring services experienced remarkable growth in this quarter. Net revenues and growth feelings both searched by more than triple-digit year-over-year. Notably, growth feelings from new student enrollment sorted by more than 200% compared to the same period last year. These results speak volumes about the strong market regulation.

Speaker Change: Next, I will walk you through the progress that made during the quarter.

Larry Chen: During the quarter, our net of reaching cash inflow reached 380.2 million. Our cash reserves remained strong, totaling 4.1 billion in cash, cash equivalent, restricted cash, and the short-term and long-term investment, which is 361.3 million higher than at the same point in time last year. This ongoing improvement in our operational efficiency is the result of our consistent folks on business, finance, and commitment to our educational aspirations. As of June 30th to 724, our deferred revenue reached 1.6 billion, representing a 71.5% increase from the same point in time last year, ensuring robust support for our continued growth in the second half of the year.

Larry: During the quarter, our net of reaching cash inflow reached 3.86.2 million. Our cash reserves remained strong, totaling 4.1 billion in cash, cash equivalent, restricted cash, and the short-term and long-term investment, which is 361.3 million higher than at the same point in time last year. This ongoing improvement in our operational efficiency is the result of our consistent folks on business, finance, and commitment to our educational aspirations. As of June 30th to 724, our deferred revenue reached 1.6 billion, representing a 71.5% increase from the same point in time last year, ensuring robust support for our continued growth in the second half of the year.

Speaker Change: Learning Services contributed over 95% of net revenues.

Speaker Change: Breaking it down, 47% of total revenues came from Nan Academic Tutorial Services.

Speaker Change: and other traditional learning services.

Speaker Change: Reviews sending an increase of nearly 55% your all year.

Speaker Change: Our new initiatives centered around non-academic tutoring services experienced remarkable girls in this quarter.

Speaker Change: Net revenues and gross feelings both searched by more than triple digit year or year.

Speaker Change: Notepolai, God's greetings from New Theater New Yomens, sword by more than 200% compared to the same period last year.

Speaker Change: B's results speak volumes about the strong market regulations of our educational products and the learning services have received.

Shannon: Our educational products and the learning services have received. For the first time, the segment contributed more than 20% of total revenues, making it one of our key revenue drivers. This success in the result of our key insights into market trends, young deep understanding of user needs, which have been able to continually optimize curriculum and learning services, making the more engaging and interactive, well-battery integrating the underlying transferable knowledge and skills. Additionally, the average number of enrolled courses per student also improved on a year-over-year basis, further demonstrating the effectiveness of our courses and services in addressing drivers' user needs.

Speaker Change: For the first time, the excitement contributed more than 20% up to the revenues.

Larry Chen: I will now provide an update on the progress we have achieved in the quarter. We have consistently recognized that the learning services and the teaching quality form is a better work of our core components. Over the past few months, we have a significant lay enhanced learning experience and outcome of the four students through the continuous optimization and the refinement of course content alongside the strategic strengthening of our instructors, and the tutors, expertise, and qualifications for instance.

Larry: I will now provide an update on the progress we have achieved in the quarter. We've consistently recognized that the learning services and the teaching quantity forms a better look of our color complex. Over the past few months, we have a significantly enhanced learning experience and outcome of the four students through continuous optimization and refinement of course content alongside the strategic strengthening of our instructors and the tutors, expertise, and qualifications, for instance.

Speaker Change: Making it fun of our key revenue drivers.

Speaker Change: Please, success in the result of our team usage into markets' trunks, yang deep understanding of user needs, which have enabled us to continually optimize curriculum and learning services.

Speaker Change: Making the more engaging and interactive, well-bathed integrating and allowing transferable knowledge and skills.

Speaker Change: But patiently, the average number of young row of the courses preceded and also improved on a year or a year basis.

Larry Chen: Within our educational services for college students, we have increased the proportion of our tutors and the content development team, the coding master's degree. They are by elevating our overall professional, procurement, and teaching quality. In our non-exemic tutoring services, we have not only bolstered our team by raising the percentage of tutors from the top ranked universities, but also sufficiently refined the classroom activities and the course design based on student feedback and end-to-trade insights.

Larry: Within our educational services for college students, we have increased the proportion of our tutors and the content development team, the coding master's degree. They are by advancing our overall professional, procurement, and teaching quality. In our non-exemic tutoring services, we have not only bolstered our team by raising the percentage of tutors from the top ranked universities, but also sufficiently refined the classroom activities and the course design based on student feedback and end-of-trade insights.

Speaker Change: For the demonstrating the effectiveness of avocourses and the services, you know, addressing drivers, you don't need.

Shannon: Our education or learning services maintained a healthy growth trajectory. During the quarter, this segment saw a high double-digit year-over-year increase in growth buildings, with revenue growth exceeding 40% compared to the same period last year. Our ongoing efforts to optimize and refine learning services significantly boosted student retention, especially for new enrolments. Moreover, the notable enrolments in our overall student structure and the more that were student-based, further fostered the health of this segment.

Speaker Change: Our educational learning services maintained a healthy growth trajectory.

Speaker Change: In the quarter, this segment saw a high double-digit year-over-year increase in gross buildings, with the revenue growth exceeding 45% compared to the same period last year.

Speaker Change: I will ongoing efforts to optimize and refine learning services, to connect it in label states given retention, especially for new in-home ends.

Larry Chen: This has boosted greater student engagement, both to rein their comprehensive capabilities in innovation, problem solving, and self-directed learning. To address individualized learning needs, we have introduced the innovative teaching models and flexible course structures that have a significantly boosted student engagement and scientific action. This approach has, in turn, contributed to the overall health of our business. During the quarter, we observed a steady increase in retention rates for our traditional learning services, with a particularly notable uptake among new enrollment. These efforts have reinforced our competitive action within the industry, and laid a solid foundation forward the effective growth of our business.

Larry: This has boosted greater student engagement, fostering their comprehensive capabilities in innovation, problems solving and self-directed learning. To address individualized learning needs, we have introduced the innovative teaching models and flexible course structures that have significantly boosted student engagement and self-defection. This approach has, in turn, contributed to the overall health of our business. During the quarter, we observed a steady increase in retention rates for our traditional learning services, with a particularly notable uptick among new enrollment.

Speaker Change: Mower, the notable human thing I will all feel in structure and a more that worked in the base, further buffed the house of the settlement.

Shannon: The other crucial component of our learning services is educational services for colleagues, students, and adults. During the quarter, this segment contributed just under 20% of total revenues. Throwing roughly 10% year-over-year. To better address the diverse learning needs of users from various backgrounds, we have rebranded our postgraduate entrance exam prep services into educational services for colleagues' students and expanded our offerings to include services such as CT4 and CT6, examination prep, and career consulting. Additionally, we have partnered with prestigious PRICE to provide high-quality educational content and resources to college students, servicing their needs for academic support, career planning, and quality job opportunities.

Speaker Change: The added crucial component of our learning services is educational services for colleagues, students and adults.

Speaker Change: During the quarter, this segment contributed just and the 20% of total revenues.

Speaker Change: Feroen rapidly 10% year or year.

Speaker Change: To better address the diverse learning needs of users from various backgrounds.

Speaker Change: We have rebranded our post-graduate action exam-traps services into educational services for college students and expanded our offerings to include services such as CD4 and CD6

Larry: These efforts have reinforced our competitive edge within the industry, and laid a solid foundation for the effective growth of our business. Looking forward, our strategic priorities will remain focused on refining our educational upgrades, improving our teaching quality, and optimizing the learning experience. Publicterial guidance is a core driving force behind the long-term growth of our company and the education industry at a large. At Gao Tu, we have enhanced the professional expertise and the ability of our leading instructors and tutors by refining our incentive and graduation framework to strengthening our organizational culture and expanding our training and feedback mechanism.

Speaker Change: Extermination Prep and Career Consulting.

Speaker Change: Additionally, we have partnered with prestigious price to provide high quality educational content, and resources to college students.

Larry Chen: Looking forward, our strategic priorities will remain focused on refining our educational operations, improving our teaching quality, and optimizing the learning experience. Publicterial guidance is a core driving force behind the long-term growth of our company and the education industry at a large. At Gao Tu, we have enhanced the professional expertise and the stability of our leading instructors and tutors by refining our incentive and graduation framework to strengthening our organizational culture and expanding our training and feedback mechanism.

Speaker Change: Service in the need for academic support, career planning and quality job opportunities.

Shannon: During the quarter, growth buildings from our educational services for college students increased by high double-digit year-over-year, while revenues from our overseas study-related services rose by high double-digit.

Speaker Change: Q. The Quarter, Drugs Williams from our educational services for college students, increased by high double digits, year over year. Well, revenues from our overseas that they related services rose by high double digits.

Shannon: I will now present our financials in more detail. Our cost of revenue this quarter was $300.4 million. Growth profit increased 34.3% year-over-year to $600.96 million with a growth margin of 69.0%. The year-over-year decrease in growth margin was predominantly a result of change to our product mix. Total operating expenses during the quarter increased 100 and 34.2% year-over-year to about 1.2 billion. Breaking it down, selling expenses increased 100 and 57.8% year-over-year to 800 and 35.4 million. Accounting for 82.7% of that revenue. This was partially attributable to our proactive recruitment of short-term theaters at the beginning of the quarter to ensure operational efficiency during the peak summer season.

Speaker Change: I will now present our financials in more details.

Speaker Change: Of a cost of revenue this quarter would 330.4 million.

Speaker Change: Girls' Prophet increased 34.3% over year to 600 and 96.4 million with a girls' margin of 69.0%.

Larry: We have also established a robust recruitment system and made a substantial investment in cultivating new teachers. In the first half of 2024, we formed a strategic partnership with over 60 leading universities across China, engaging in collaborative initiatives such as joint programs and on-campus lecture series. To support new hires, we have implemented programs like mentor, orientation, and a new camera camp to facilitate their simulation to our culture, smooth team integration, and effective transition into teaching roles.

Larry Chen: We have also established a robust recruitment system and made the substantial investments in cultivating new teachers. In the first half of 2024, we formed a strategic partnership with over 60 leading universities across China, engaging in collaborative initiatives such as joint programs and on-campus lecture series. To support new hires, we have implemented programs like a mentor, orientation, and a new camera time to facilitate their seamless inclination to our culture, smooth team integration, and effective transition into teaching roles.

Speaker Change: The year over a decrease in God's margin was predominantly a result of change to our product mix.

Speaker Change: Total operating expenses during the quarter increased 100 and 4.2% year over year to about 1.2 billion.

Speaker Change: Breaking it down, selling expenses increased 100 and 5.8% year over year to 800 and 35.4 million.

Speaker Change: Accounting for 82.7% of that revenue.

Larry Chen: These initiatives equate them with the skills and not only the needed to succeed in their role. Moreover, we are actively onboarding seasoned industry professionals with extensive industry experience and maintenance capabilities. Their proven methodologies and the strategic insights are infusing our rapidly expanding business ways, the invaluable expertise and covering our handsaver perspectives. Going forward, we remain dedicated to cultivating our pendent pole to ensure a solid foundation for sustained and effective growth. While rapidly expanding our business, we have maintained and we remain focused on operational efficiency in terms of customer acquisition.

Larry: These initiatives equate them with the skills and allow the needed to succeed in their role. Moreover, we are actively onboarding seasoned industry professionals with extensive industry experience and maintenance capabilities. Their proven methodologies and the strategic insights are infusing our rapidly expanding business ways, the invaluable expertise and cobbling handsaver perspectives.

Speaker Change: List was partially attributable to our proactive recruitment of short-term teachers at the beginning of the quarter, to ensure operational efficiency during the pick summer season.

Shannon: The increase also reflected a rise in our marketing expenses in response to heightened market demand over the period, while maintaining solid unit economics. Research and development expenses increased 64.7% year-over-year to 162.1 million. Accounting for 16.1% of that revenue. General and administrative expenses increased 209.3% year-over-year to 169.6 million. Accounting for 16.2% of that revenue. The increase was largely driven by the recruitment of season management professionals and operational staff to support and scale growth of our online business. And the expansion of our offline operations, ensuring the smooth development of our business. Loss from operations was 464.8 million.

Speaker Change: The inquiries also reflected a rise in our marketing expenses in response to a heightened market demand over the period while maintaining solid-unit economics.

Speaker Change: Research and development expenses increased 64.7% year over year, 261.1 million. Accounting for 16.1% of that revenue is possible.

Larry: Going forward, we remain dedicated to cultivating our pen and pull to ensure a solid foundation for sustained and effective growth. While rapidly expanding our business, we have maintained and we remain focused on operational efficiency in terms of customer acquisition. We have for activity increased investment in talent and resources developed a diverse range of acquisition channels with a particular focus on building proprietary channels and private private compose. This strategy not only establish competitive market position for us but also effectively mitigate the risks by fostering closer cross-team collaboration and streamlining operations.

Speaker Change: General and the Administrative Sciences increased 209.6 million. A coming for 16.2% of net revenues.

Larry Chen: We have for activity increase the investment in talent and resources developed a diverse range of acquisition channels with a particular focus on building proprietary channels and private-private poles. This strategy not only establishes competitive market position for us, but also effectively medicated risks by fostering closer cross-chain collaboration and streamlining operations. We have consistently maintained the user conversion rates at a high level. Looking ahead as our enrolments grow and brand recognition in the band, we will continue to leverage the power of public tableware of a mouse. So further, it drains our brand and drive effective business growth.

Speaker Change: The increase was largely driven by the recruitment of seasoned management professionals in the position of staff to support and scale growth of our online business.

Speaker Change: and the extension of our offline operations, ensuring the smooth development of our business.

Speaker Change: Last, from operations, or 464.8 million.

Shannon: And operating margin was negative 46.0%. Then gap loss from operations was 462.2 million. And then Gap operating margin was negative 44.9%. Then loss was 420.9 million. And that income margin was negative 42.5%. Then gap loss was 480.0 million. And then gap that income margin was negative 41.2%. Our math operating cash inflow was 386.2 million.

Larry: We have consistently maintained the user conversion rate at a high level. Looking ahead as our enchantments grow and brand recognition in the band, we will continue to leverage the power of positive word of a mouse to further strengthen our brand and drive effective business growth.

Speaker Change: and opening module was magnitude for the 6.0%

Speaker Change: Gap lost from opposition was 452 million.

Speaker Change: and Nan Gap of the Margin was Nagai for the full 49%

Speaker Change: The last was 249.6 million, and not income margin was magnitude 42.5%.

Larry Chen: Druen's 16th mark for the 10th anniversary of a call to the funding of the past decade. We have stated true to our educational aspirations of striving for excellence by carnating the power of artificial intelligence. We are advancing our mission to make the living better and working faithfully pursuing our operational goal of fostering student growth through exceptional teachers and realising meaningful social value. In response to China's evolving demands for talent, codivation, we co-hosted the second top and not innovative talent, collaborative, but cultivating the economic reform in collaboration with esteemed official organizations, including the Chinese society of educational development of strategy.

Larry: Drun's 16th mark for the 10th anniversary of a call to the funding of the past decade, we have stated true to our educational aspirations of striving for excellence by carnating the power of artificial intelligence. We are advancing our mission to make the living better and working militantly pursuing our operational goal of fostering student growth through exceptional teachers and the realigning meaningful social value. In response to China's evolving demands for talent cultivation, we co-hosted as a second top and not innovative talent collaborative, but cultivating the economic reforming in collaboration with esteemed official organizations, including the Chinese society of educational development of strategy.

Speaker Change: Nan Gat, Nan Lough, or 480mAh, Nan Gat, Nan Income Margin, was negative for the 1.2%.

Speaker Change: I will not operating cash in slow, would 300 m, 86.2 million

Shannon: Now turning to our balance sheet. As of June 30th, 2024, we held 1.4 billion in cash. Cash equivalent and risk ticket cash. Along with 1.8 billion in short-term investments. And 95.8 million in long-term investments. Let's come to a total of over 4.1 billion. Approximately 300 and 1 million higher than at the same point in time last year. As of June 30th, 2024, our deferred revenue balance was 1.6 billion, which primarily consists of treason received in Iran.

Speaker Change: Now, turning to our balance sheet.

Speaker Change: As of June, the 30th, 2024, we held 1.4 billion in cash, cash equivalents, and restricted cash, along with 1.8 billion in short-term embassments, and 900 and 5.8 million in long-term embassments.

Speaker Change: This comes to a total of over 4.1 billion, approximately 301 million higher than at the same point in time last year.

Larry Chen: This initiative underscores our dedication to advancing the framework and practices essential for nurturing a number of talent in the education sector, according to our internal data, the number of a goal to students, or the message to the top two Chinese universities in 2022-2024 has seen a further increase from last year, a strong testament to our excellence in cultivating outstanding innovative talent.

Larry: This initiative underscores our dedication to advancing the framework and practices essential for nurturing a number of talent in the education sector. According to our internal data, the number of a call to students admitted to the top two Chinese universities in 2024 has seen a further increase from last year, a strong testament to our excellence in cultivating outstanding innovative talent. Our success is fundamentally rooted in the trust and the support of our shareholders.

Speaker Change: As of June 3, 2024, I was deferred to Labanur Balance, was 1.6 billion, which primarily consists of tuition received the other ones.

Shannon: As for August 26, 2024, we had repushed an aggregate of around 7.9 million ADS on the open market for approximately 27 million US dollars under the existing share repushed program. We will continue to execute stock buybacks in accordance with the guidance of the board of directors, and create long-term value for our shareholders.

Speaker Change: As for August, the 26th, 2024, he had reprisions and aggregates of around 7.9 million the ads on the open market for approximately 27 million US dollars.

Speaker Change: and other existing share repression program.

Larry Chen: Our success is fundamentally rooted in the trust and support of our shareholders. We remain steadfastly committed to enhancing shareholder value. As of August of the 26th to 724, the company had repurchased the strong 7.9 million ideas in aggregate for total approximately 27 million US dollars under the existing share repurchased program. Moving forward, we remain committed to prioritizing customers' needs and creating lasting value for our shareholders. Thank you very much.

Speaker Change: will continue to execute stock badbacks in accordance with the guidance of the Board of Directors and create a long-term value for our shareholders.

Larry: We remain steadfastly committed to enhancing shareholder value. As of August of the 26th to 724, the company had repurchased the strong 7.9 million ideas in aggregate for a total of approximately 27 million US dollars under the existing share repurchase program. Moving forward, we remain committed to prioritizing customer needs and creating lasting value for our shareholders. Thank you very much.

Shannon: Before I provide our business outlook for the next quarter, please allow me to remind everyone that these contain four lodging statements, which include risks and uncertainties that are beyond our control, and could cause the actual results to differ materially from our predictions.

Speaker Change: Before I provide our business outlook for the next quarter, please allow me to remind everyone that these contains four emerging statements, which include risks and uncertainties that are beyond our control and could cause the actual results to de-permaterally from our predictions.

Shannon: Based on our current estimates, total net revenues for the third quarter of 2024 are expected to be between 1,188 million and 1,208 million, representing an increase of 50.5% to 53.0%. And we will now begin the question and answer session.

Speaker Change: Please, I will turn the estimate.

Speaker Change: Total net revenues for the supporter of 2024 are expected to be between 1,100,88 million and 1,28 million.

Larry Chen: This is the end of my prepared remarks.

Larry: This is the end of my prepared remarks.

Unknown Executive: Now I will pass the call over to our CEO, Shannon, to walk you through the financial and operational details over to Carter. Thank you, Larry. And thank you, everyone, for joining our call today.

Shannon: Now, I will pass the call over to our CEO for Shannon to walk you through the financial and operational DTU's over-to-counter. Thank you, Larry. And thank everyone for joining our call today.

Speaker Change: Representing an increase of 50.5% to 50.0% on a year or a year basis.

Speaker Change: This concludes my prepared remarks. Uproater, we are now ready for the QA section. Thank you, I advance for listening.

Chen Chen: I will now walk you through our operating and financial performance for the second quarter of fiscal year, 2020-2024. We kick it off the year with robust growth and successfully carried this momentum into the second quarter further scaling our operations, well delivering results that exceeded our expectations. In both revenues and growth billings, specifically, net revenues grow 43.6% year over year to 1.0 billion. Outpacing the growth rate, we sat in the first quarter by approximately 10 percentage points.

Shannon: I will now walk you through our operating and financial performance for the second quarter of fiscal year 2024. We kick it off the year with robust growth and successfully carried this momentum into the second quarter. Further scaling our operations, well-delivering results that exceeded our expectations in both revenues and growth buildings. Specifically, net revenues grew 43.6% year-over-year to 1.0 billion. Outpacing the growth rate, we sat in the first quarter by approximately 10 percentage points.

Operator: We will now begin the question and answer session.

Unknown Executive: To ask a question, you may press star, then one, on your touchtone phone. If you are using a speaker phone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star, then two.

Speaker Change: To ask a question, you may press star and one on your touch tone phone.

Speaker Change: If you are using a speaker phone, please pick up your handset before practicing the keys.

Speaker Change: If at any time your question has been addressed and you would like to withdraw your question, please press star then too

Unknown Executive: At this time, we will pause momentarily to assemble our roster.

Speaker Change: At this time we will pause momentarily to assemble our roster.

Alice Cai: The first question today comes from Alice Kai with City Bank. Please go ahead. Good evening, Larry and Shalant. I have a question about the offline extension, because it is noted that the intro is uploaded, possibly related to offline extension, I guess. Could you please share some insights on the progress of offline extension? For instance, how many cities have been entered? How many centers have been opened so far? How is the student enrollment in the city? Can it come out and be appreciated? Thank you. Thanks, Alice.

Speaker Change: This is the first question today, comes from Alice Kai with City Bank. Please go ahead.

Alice Kai: Good evening, sorry and shallons.

Chen Chen: Growth billings for the first half of the year increased 67.7% to 2.4 billion. Leading a solid foundation for further revenue growth in the second half of the year. These results reflect our ongoing efforts to boost operational efficiency, address market demand, and enhance teaching quality. Moving forward, we will maintain our focus on co-acquition business, expand our product offering, attract top talents, and refine operations to catalyze our market opportunities and drive long-term sustainable growth.

Shannon: Growth buildings for the first half of the year Laying a solid foundation for further revenue growth in the second half of the year. These results reflect our ongoing efforts to boost operational efficiency, address market demand, and enhance keeping quality. Moving forward, we will maintain our focus on cooperation business, expand our product offering, attract top talents, and refine operations to catalyze our market opportunities and drive long-term sustainable growth.

Speaker Change: on the description about the online extension.

Speaker Change: because it's no good thing trying to stop this.

Speaker Change: has been the reason to apply things in I can.

Speaker Change: Could you please share some advice on the progress of online extensions?

Speaker Change: for St. Paul, many degrees heavy on track, many of the things that have your open so far, and found the students enrollment in this city. And it can only appreciate it. Thank you.

Larry: You were asking about our offline business expansion progress and the numbers of living centers, right? We are very glad to share the progress we have made on our offline business, relying on the brand recognition and the industry influence of our founder Larry. A highly efficient and professional team was rapidly assembled in the first half in 2024, providing a strong foundation for our offline operations. Therefore, the extension of learning centers both in terms of city coverage and the number of learning centers has significantly exceeded our expectations at the beginning of the year. At the same time, the business is progressing steadily and rapidly, with notable achievements across a lot of tasks.

Speaker Change: Thanks to Alice, you were asking about our offline business expansion progress and the numbers of living centers, right? And we are very glad to share the progress we have made on our offline business.

Chen Chen: Before diving into the results with quarter, I would like to first address the seasonality and the vitality inherent in our online education business. To effectively manage the summer surge in demand, we strategically planned and allocated resources a height of time, particularly for teacher recruitment, team training, and custom acquisition channels. Things there is typical of three to six months back between these investments and revenue recognition. We recommend using the ratio of growth feelings to market expenditure as a key magic to more accurately get custom acquisition efficiency for our online business.

Shannon: Before diving into the results with quarter, I would like to first address the seasonality and the vitality inherent in our online education business. To effectively manage the summer search in demand, we strategically planned and allocating resources a height of time, particularly for teacher recruitment, team training, and customer acquisition channels. Using their typical three to six months back between these investments and revenue recognition, we recommend using the ratio of growth buildings to market expenditure as a key magic to more accurately get customer acquisition efficiency for our online business.

Speaker Change: Reliring all the brand regulations and the industry influence of our founder Larry, a highly efficient and professional team was rapidly assembled in the first half in 2024.

Speaker Change: Providing a strong foundation for our offline operations.

Speaker Change: and therefore the extension of learning centers, both in terms of city coverage and the number of learning centers has significantly exceeded our expectations at the beginning of the year.

Speaker Change: At the same time, the business is progressing steadily and rapidly, with notable achievements across a lot of tasks.

Shannon: During the quarter, we dynamically adjust our investments in marketing activities and customer acquisition channels, which led to better than expected growth feelings while ensuring acquisition efficiency, thereby successfully delivering on our goal of effective growth. Additionally, since our fiscal quarter do not fully align with the school calendar, the extensive investments made during the summer would span substantially both in the second and third fiscal quarters, impacting our near-term operating profit. We are confident that our strategic investments in summer will drive meaningful growth in student enrollment, further solidify our market position, and boost brand regulation.

Chen Chen: During the quarter, we dynamically adjusted our investments in marketing activities and customer acquisition channels, which led to better than expected growth feelings while ensuring acquisition efficiency, thereby successfully delivering on our goal of effective growth. Additionally, since our fiscal quarter do not fully align with the school calendar, the extensive investments made during the summer would spend substantially both in the second and the third fiscal quarter, impacting our near-term operating profit. We are confident that our strategic investments in summer will drive meaningful growth in student enrollment, further solidify our market position, and boost brand regulation.

Larry: On the journey of exploring our offline business, we found several key parts where offline and online business can work synergistically. Firstly, in teacher recruitment, we have a strong capability in recruiting top-tier talent from prestigious domestic universities like Beijing, Fujiao, and also other top-notch universities. Our high-quarters recruitment team have been able to across these institutions combined with the ability to share excellent teaching resources to our offline operations, provides critical faculty support for our offline operations in their early stage, which is very important for an offline learning center. This will greatly enhance the quality of our offline education, offering students to improve our educational resources because we all know that teachers are the most successful factors of offline learning centers.

Speaker Change: and on the journey of exploring our offline business, we've found several key parts where offline and online business can work our synergisticly.

Speaker Change: First of all, in teacher recruitment, we have a strong capability in recruiting top tier talent.

Speaker Change: from Press Teachers Domestic University, like Beijing, Fugiao, and also other top-notch University.

Speaker Change: and I will have quarters recruitment team helping able to across these institutions, combined with the ability to share excellent teaching resources to our offline operations.

Speaker Change: Preways critical faculty support for our offline operations in their early stage, which is...

Speaker Change: are very important for a offline user to use a offline learning center.

Shannon: Next, I will walk you through the progress we've made during the quarter. Learning services contributed over 95% of net revenues. Breaking it down, more than 75% of total revenues came from non-actemic tutoring services and other traditional learning services, representing a increase of nearly 55% year-over-year. Our new initiatives centered around non-actemic tutoring services experienced remarkable growth in this quarter. Net revenues and growth feelings both searched by more than triple-digit year-over-year. Notably, growth feelings from new student enrollment sorted by more than 200% compared to the same period last year.

Chen Chen: Next, I will walk you through the progress that made during the quarter. Learning services contributed over 95% of net revenues. Breaking it down, more than 75% of total revenues came from non-academic tutoring services, and other traditional learning services, representing a increase of nearly 55% year-over-year. Our new initiatives centered around non-academic tutoring services experienced remarkable growth in this quarter. Net revenues and growth feelings both surged by more than triple-digit year-over-year. Notably, growth feelings from new student enrollments sorted by more than 200% compared to the same period last year.

Speaker Change: This will greatly enhance the quality of our application. Open students to purer our educational resources because we all know that T-shirts the most successful factors of offline learning centers.

Larry: And secondly, in terms of educational products and countenance, the meticulously refined online teaching materials, particularly those overlapping with offline education, such as cost wear, can be shared. This could significantly increase the efficiency of our offline education product process. This is only conservative resources, but also ensure that offline teaching is supported by high quality content. And also, and most importantly, is our brand awareness. Compared to other brand-new offline education brands, our brand holds significant value in demands of parents and students, providing a strong boost to our offline business.

Speaker Change: and, secondly, in terms of additional products and contents.

Speaker Change: The meticulously refined online teach-on materials.

Speaker Change: Pateculate, those old lightingways offline education such as Calfware can be shared. This could significantly increase the efficiency of our offline education product process.

Speaker Change: This is only considered research but also ensure that offline teaching is supported by a high quality content

Speaker Change: and also in the most important day is our brand awareness.

Speaker Change: Compared to other brand new offline activation brands, our brand holds significant value in the man's of parents and students, providing a strong boost to our offline business.

Shannon: These results speak volumes about the strong market regulation. Our educational products and the learning services have received. For the first time, the segment contributed more than 20% of total revenues, making it one of our key revenue drivers. This success in the result of our key insights into market trends, young deep understanding of user needs, which have been able to continually optimize curriculum and learning services, making the more engaging and interactive, well-battery integrating the underlying transferable knowledge and skills.

Chen Chen: These results speak volumes about the strong market recognition of our educational products and the learning services have received. For the first time, the segment contributed more than 20% of total revenues, making it one of our key revenue drivers. This success in the result of our key insights into market trends, young deep understanding of user needs, which have been able to act to continually optimize curriculum and learning services, making them more engaging and interactive, well-battery integrating the underlying transferable knowledge and skills.

Larry: However, there are notable differences between offline and online operations will be identified in the past half of the year. Online education products play a great exercise on localization and personalization. Given our simultaneously expansion into multiple cities and multiple learning centers, current education research efforts are paid to meet the specific needs of students in different regions. That means we need to invest in localized content at least days, and this is partially explained in the increase in our R&D expenses.

Speaker Change: However, there are notable differences between offline and online operations they would be identified in the past.

Speaker Change: of the year. Of Nan Education Products, please, a greater emphasizes on localization and personalization.

Speaker Change: given our simultaneous expansion into multiple cities and multiple learning centers.

Speaker Change: Curtin Education Research Actors are paid to meet the specific needs of students in different regions. That means we need to invest in localized content at this stage, and this is partially explained at the increase in our R&D expenses.

Chen Chen: Additionally, the average number of enrolled courses per student also improved on year-over-year basis, further demonstrating the effectiveness of our courses and services, in addressing drivers' user needs. Our educational learning services maintained a healthy growth trajectory. During the quarter, this segment saw a high double-digit year-over-year increase in growth buildings, with revenue growth exceeding 40% compared to the same period last year. Our ongoing efforts to optimize and refine learning services significantly boosted student retention, especially for new enrolments. Moreover, the notable enrolments in our overall student structure and the more that were student-based further fostered the health of this segment.

Shannon: Additionally, the average number of enrolled courses per student also improved on year-over-year basis, further demonstrating the effectiveness of our courses and services in addressing drivers' user needs. Our education or learning services maintained a healthy growth trajectory. During the quarter, this segment saw a high double-digit year-over-year increase in growth buildings, with revenue growth exceeding 40% compared to the same period last year. Our ongoing efforts to optimize and refine learning services significantly boosted student retention, especially for new enrolments. Moreover, the notable enrolments in our overall student structure and the more that were student-based, further fostered the health of this segment.

Larry: And also, the operation is quite different as well if we compare the offline business to the offline business. We need to develop an operational support system, distinct from our online business, requiring investment in product research and development. For example, systems to support set selection and renovation of campus, as well as systems for students to check in and class with scheduling exactly. These significant differences in operation details between online and offline business make a comprehensive operational support system crucial for our multiple locations and multiple campus expansion. Social system will significantly enhance operational efficiency and ensure that our operation in offline business will be successful.

Speaker Change: and also the operation is quite different as well if we compare the offline business to the offline business.

Speaker Change: We need to devise an operational support system, this thing from our online business.

Speaker Change: Requiring investment in product research and development, for example, systems with support, set selection and renovation of campus.

Speaker Change: As well as our systems for students who check in and class with scheduling the aircraft.

Speaker Change: Lee, Singletta and Difference in Opportunity Details between online and offline business make a comprehensive operational support system crucial for our multiple locations and multiple campus expansion.

Speaker Change: Center System will significantly enhance operational efficiency and ensure that our operation in offline business will be successful.

Larry: At the same time, we fully recognize that the entry barriers for offline business are very high and the mode is deep. Building systems for teacher recruitment and training, principal cultivation, educational products, and operational support requires a long, long cycle. And we do not underestimate the challenge of establishing recognition and reputation among students and parents as a new ancient. Now we overlook the time and cost of team integration and development. However, we are deeply committed to our offline business strategy with a high level of patience and determination. The current investment is of great importance for our long-term growth, but of family. When the time is right and when our offline revenue contribution reaches a certain level of significance, we will begin disclosing relevant all-perish metrics, including the cities we enter and also the numbers of our learning centers, and that can help us to gain a more comprehensive understanding of the progress of our offline business in the future.

Speaker Change: At the same time, we fully recognize that the entry barriers for offline business are very high and the mode is deep.

Chen Chen: The other crucial component of our learning services is educational services for colleagues, students, and adults. During the quarter, this segment contributed just under 20% of total revenues, throwing roughly 10% year-over-year. To better address the diverse learning needs of users from various backgrounds, we have rebranded our postgraduate entrance exam prep services into educational services for colleagues, students, and expanded our offerings to include services such as CT4 and CT6, examination prep and career consulting.

Shannon: The other crucial component of our learning services is educational services for colleagues, students, and adults. During the quarter, this segment contributed just under 20% of total revenues. Throwing roughly 10% year-over-year. To better address the diverse learning needs of users from various backgrounds, we have rebranded our postgraduate entrance exam prep services into educational services for colleagues' students and expanded our offerings to include services such as CT4 and CT6, examination prep and career consulting.

Speaker Change: Building Systems for teacher recruitment and training, principal conservation, educational products and operational support requires a long, long cycle. And we do not underestimate the challenge of accessibility, accessibility and recognition on the reputation.

Speaker Change: of Modern Students and Parents, as a new ancient, now do we overlook the time and cost of team integration and development. However, we had deeply committed to our offline business strategy, a ways of high level of patience and determination.

Chen Chen: Additionally, we have partnered with prestigious PRICE to provide high-quality educational content and resources to college students, servicing their needs for academic support, career planning, and quality job opportunities. During the quarter, growth buildings from our educational services for college students increased by high-double digits year-over-year, while revenues from our overseas static related services rose by high-double digits.

Shannon: Additionally, we have partnered with prestigious PRICE to provide high-quality educational content and resources to college students, servicing their needs for academic support, career planning, and quality job opportunities. During the quarter, growth buildings from our educational services for college students increased by high double-digit year-over-year, while revenues from our overseas study related services rose by high double-digit.

Speaker Change: The currently investment days of creating importance for our long term growth.

Speaker Change: Fat.

Speaker Change: Well, family when the time is right and when our offline revenue contribution reaches a certain level of significance, we will begin disclosing relevant operation matrix.

Alice Kai: including the cities we entered and also the numbers of our learning centers and that can help us to gain a more comprehensive understanding of the progress of our offline business in the future. Thanks, Alice.

Timothy Zhao: Thanks, Alice. The next question comes from Timothy Zhao with Goldman Sachs. Please go ahead. Great. Thank you, my friend, for taking my question. I think in Europe, Paramount, you mentioned about the AI. So my question is regarding the AI empowerment in education.

Alice Kai: Chen, Katherine Chen, Katherine Chen,

Shannon: I will now present our financials in more detail. Our cost of revenue this quarter was $300.4 million. Growth profit increased 34.3% year-over-year to $600.96.4 million with a growth margin of 69.0%.

Chen Chen: I will now present our financials in more detail. Our cost of revenue this quarter was $300.4 million. Growth profit increased 34.3% year-over-year, to $600.96.4 million, with a growth margin of 69.0%. The year-over-year decrease in growth margin was predominantly a result of change to our product mix. Total operating expenses during the quarter increased 100 and 34.2% year-over-year to about 1.2 billion. Breaking it down, selling expenses increased 100 and 57.8% year-over-year to 800 and 35.4 million.

Speaker Change: The next question comes from Timothy Zhao with Goldman Sachs, please go ahead.

Speaker Change: Great, calm.

Timothy Zhao: Thank you, Metro, for taking my question. I think in your paper amongst you mentioned about the AI. So my question is regarding the AI empowerment in education. Just wondering what is the measurement view and what is your strategy in this view for different benefits. And how much potential opportunities you can do to think AI will bring to your benefits. Thank you.

Larry: Just wondering what is the measurement view and what is your strategy in this field for different business segments, and how much potential offline efficiency gains do you think AI will bring to your business. Thank you. Thanks, Timothy. This is a very good question, and the whole management team pays a lot of attention to the most recent update on the artificial intelligence. So it's a rapid development of AI technology and the continuous evolution and development of AI forms in various industries recently. We have a more profound and clear understanding of the application of artificial intelligence and very personally visited in the United States and personally meet a couple of entrepreneurs in the Silicon Valley to get the most recent knowledge about artificial intelligence.

Shannon: The year-over-year decrease in growth margin was predominantly a result of change to our product mix. Total operating expenses during the quarter increased 100 and 34.2% year-over-year to about 1.2 billion. Breaking it down, selling expenses increased 100 and 57.8% year-over-year to 800 and 35.4 million. Accounting for 82.7% of that revenue. This was partially attributable to our proactive recruitment of short-term theaters at the beginning of the quarter to ensure operational efficiency during the peak summer season.

Speaker Change: Yes, thanks, James. This is a very good question and the whole management team.

Speaker Change: Pay a lot of attention to the most recent update on the artificial intelligence.

Speaker Change: So, with the rapid development of AI technology and the continuous evolution and development of AI forms in various industries recently. We have a more profound and clear understanding of the application of artificial intelligence.

Chen Chen: Accounting for 82.7% of that revenue. This was partially attributable to our proactive recruitment of short-term tutors at the beginning of the quarter to ensure operational efficiency during the peak summer season. The increase also reflected a rise in our marketing expenses in response to heightened market demand over the period while maintaining solid unit economics. Research and development expenses increased 64.7% year-over-year to 162.1 million. Accounting for 16.1% of that revenue. General and administrative expenses increased 200 and 9.3% year-over-year to 169.6 million.

Speaker Change: and very personally visited United States and personally meet a couple of entrepreneurs in the city of Hong Kong Valley to get the most recent knowledge about occupational intelligence. Currently, AI has been widely used in quite a few aspects of our business.

Shannon: The increase also reflected a rise in our marketing expenses in response to heightened market demand over the period while maintaining solid unit economics. Research and development expenses increased 64.7% year-over-year to 162.1 million. Accounting for 16.1% of that revenue. General and administrative expenses increased 209.3% year-over-year to 169.6 million. Accounting for 16.2% of that revenue. The increase was largely driven by the recruitment of season management professionals and operational staff to support and scale growth of our online business. And the expansion of our offline operations, ensuring the smooth development of our business.

Larry: So currently, AI has been widely used in quite a few aspects of our business, and the current applications are mainly focused on internal cost reduction and efficiency improvement. Firstly, in the field of teaching product design and research and development, artificial intelligence can help our designers improve efficiencies very well, like automatic corrections of the students' homework. And AI oral language practice that the students can talk to the app or the programs on their way chat and to do the daily oral practice. And also the design of more interactive AI teaching products are used to assist our teachers and our teachers to provide more personalized learning of our existing students.

Speaker Change: and the current applications are mainly focused on internal calls to the reduction and the efficiency improvement.

Speaker Change: Firstly, in the field of teaching for that design and research and development.

Facial Intatators: At Facial Intatators, our designers improve efficiencies very well.

Facial Intatators: like automatic corrections of the student homework.

Facial Intatators: and AIORO language practice, that the students can talk to the app or the programs on their chat and to do all the daily AORO practice.

Chen Chen: Accounting for 16.2% of that revenue. The increase was largely driven by the recruitment of season management professionals and operational staff to support and scale growth of our online business. And expansion of our offline operations. Ensuring the smooth development of our business. Lost from operations was 464.8 million. And operating margin was negative 46.0%. And gap loss from operations was 462.2 million. And gap operating margin was negative 44.9%. Then loss was 429.6 million. And income margin was negative 42.5%. Now gap loss was 480.0 million. And gap net income margin was negative 41.2%. Our net operating cash inflow was 386.2 million.

Facial Intatators: and also the design of more interactive AI teaching products I used to assist.

Speaker Change #100: of Harvard tutors and our teachers.

Speaker Change #100: to provide a more personalized learning of our existing students.

Larry: But currently, a majority of our product will provide it to our existing students instead of promoting them to the new students because we want them to be polished, and we want to make sure they can create an incremental value to our students before they promote them to the market. And secondly, in the link of Internet product research and development, AI has significantly improved the efficiency in front and research and development, including our internal instant message system and also other internal efficiency tools where I'll apply AI technology to improve our office efficiency. Finally, in other operational links such as constructions of customer service and automatic responses, AI is also playing an important role in reducing cost and improving efficiency in different links.

Shannon: Loss from operations was 464.8 million. And operating margin was negative 46.0%. Then gap loss from operations was 462.2 million. And then gap operating margin was negative 44.9%. Then loss was 420.9.6 million. And that income margin was negative 42.5%. Then gap loss was 480.0 million. And then gap that income margin was negative 41.2%.

Speaker Change #101: The current delay in majority of our product will provide it to our existing students.

Speaker Change #101: in Stadolf promoting them to the new students because we found them to be polished and we want to make sure they can create incremental value to our students before we promote them to the market.

Speaker Change #101: and secondly, in the link of Internet for that research and development, AI has significantly improved the efficiency in front and research and development.

Speaker Change #101: including our internal instant message system and also other internal efficiency tools. We all applied AI technology to improve our alpha and safety efficiency.

Speaker Change #101: of finally.

Speaker Change #101: to like any other operational links, such as construction of customer service and automatic responses.

Shannon: Our math operating cash inflow was 386.2 million.

Chen Chen: Now turning to our balance sheet. As of June the 30th, 2024, we held 1.4 billion in cash, cash equivalence, and risk ticket cash. Along with 1.8 billion in short term investments in 9.5.8 million in long term investments. Risk comes to a total of over 4.1 billion, approximately 300 and 1 million higher than at the same point in time last year. As of June the 30th, 2024, our deferred revenue balance was 1.6 billion, which primarily consists of treason received in Iran.

Speaker Change #101: AI is also playing an important role in reducing cost and improved efficiency in different links. So, we believe in the future as the top technology develops, artificial intelligence can create a huge value to our company. But right now, we want the investment in this field to be...

Shannon: Now turning to our balance sheet. As of June the 30th, 2024, we held 1.4 billion in cash. Cash equivalent and risk ticket cash. Along with 1.8 billion in short term investments. And 95.8 million in long term investments. Let's come to a total of over 4.1 billion. Approximately 300 and 1 million higher than at the same point in time last year. As of June the 30th, 2024, our deferred revenue balance was 1.6 billion, which primarily consists of treason received in Iran.

Larry: So we believe in the future as the top technology develops. Our artificial intelligence can create a huge value to our company. But right now, we want the investment in this field to be more conservative.

Speaker Change #101: to be more conservative and right now we only use it to improve our internal efficiency at least stage. Thanks, Timothy.

Unknown Executive: Right now, we only use it to improve our internal efficiency at this stage. Thanks, Timothy.

Unknown Executive: Thank you, Shannon.

Shannon Chen: Thank you, Shannon.

Summer Chien: The next question comes from Summer Chien with CLSA. Please go ahead. Thank you for taking that question, and the congratulations, congratulations, congratulations on our strong corner. My question is that we started counting, Shannon? My question is that we see the standards that, of course, three will be a faster growth quarter, so can we share more color about the revenue growth? Breakdown for course three. Online offline and then five in a second. Thank you. Thanks, Summer. We wouldn't be able to hear clearly, but I guess you were asking about the revenue guidance for the next quarter.

Shannon Chen: The next question comes from Summer Chen with CLSA. Please go ahead.

Speaker Change #103: Thank you for taking that pleasure and the congratulations to all of you in the comments. I'm sorry, I'm sorry, I'm sorry.

Chen Chen: As for August 26, 2024, we had repushed an aggregate of around 7.9 million ADS on the open market for approximately 27 million US dollars, and the existing share repushed program. We will continue to execute stock buybacks in accordance with the guidance of the board of directors and create a long-term value for our share holders.

Shannon: As for August 26, 2024, we had repushed an aggregate of around 7.9 million ADS on the open market for approximately 27 million US dollars under the existing share repushed program. We will continue to execute stock buybacks in accordance with the guidance of the board of directors, and create a long-term value for our shareholders.

Speaker Change #103: [inaudible]

Samar: Thanks, Samar.

Chen Chen: Before I provide our business outlook for the next quarter, please allow me to remind everyone that these contains four lodging statements, which include risks and uncertainties that are beyond our control, and could cause the actual results to defer materially from our predictions. Based on our current estimates, total net revenues for the third quarter of 2024 are expected to be between 1,188 million and 1,208 million, representing an increase of 50.5% to 53.0% on a year-over-year basis.

Shannon: Before I provide our business outlook for the next quarter, please allow me to remind everyone that these contains four lodging statements, which include risks and uncertainties that are beyond our control, and could cause the actual results to defer materially from our predictions. Based on our current estimates, total net revenues for the third quarter of 2024 are expected to be between 1,188 million and 1,208 million, representing an increase of 50.5% to 53.0%, and we will now begin the question and answer session.

Speaker Change #105: We wouldn't be able to hear it clearly, but I guess you were asking about the revenue guidance for the next quarter Yeah, and I do think I do think the guidance should be diving into the numbers deeply So as of now, our gospelings in the first half of the year is approximately 2.4 billion

Shannon: Yeah, and I do think the guidance should be diving into the numbers of the play. So as of now, our hospital in the first half of the year is approximately 2.4 billion. With a year-old year growth rate of about 67.7 percent, and the before revenue balance increased over 30 percent year-old year, that all indicated a higher revenue growth rate in the third quarter, right? And the upper limit of revenue guidance we provided in the earnings release is 1.208 billion. With a year-old year growth rate of 53 percent, it appears that the growth rate of growth buildings is much higher than that revenue.

Speaker Change #106: Please a year or a year go through it for about a...

Speaker Change #107: 67.7% and the before revenue balance increased over 30% year. That all indicated a higher revenue growth rate in the third quarter, right? And the upper limit of revenue guidance we provided in the earnings release is...

Speaker Change #108: 1.208 billion with a year or a year growth rate of 53% it appears that the growth rate of growth buildings is much higher than that revenue. There are mainly two reasons for this.

Chen Chen: This concludes my prepared remarks.

Unknown Executive: A quater, we are now ready for the QA section. Thank you, everyone, for listening. We will now begin the question and answer session. To ask a question, you may press star, then one, on your touch-tone phone. If you are using a speaker phone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star, then two. At this time, we will pause momentarily to assemble our roster.

Shannon: There are mainly two reasons for this. And first, the class schedule in September, which is the last month in the Q3, has one last weekend compared to 2023, which negatively impacts the year-old year growth rate by approximately five percentage points, and the related revenue will be recognized in Q4. And secondly, they conducted some special price class operations for entrance level grade during the summer course, seizing the prices strategic window to increase the student scale. For these students, the main contribution to Q3 is growth buildings instead of revenues, and the revenue contributions will be present in Q4.

Unknown Executive: To ask a question, you may press star, then one, on your touchtone phone. If you are using a speaker phone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star, then two.

Speaker Change #109: In 1st, the class schedule in September, which is the last month's Unit Q3, has 1 less weekend compared to 2020.

Speaker Change #109: 2023, which negatively impacts the year or year growth rate by approximately five percentage points.

Unknown Executive: At this time, we will pause momentarily to assemble our roster.

Speaker Change #109: and the related revenue will be recognized in Q4. And secondly, they conducted special prize class operations for entrance level grade during the summer course, seizing the...

Alice Kai: The first question today comes from Alice Kai with City Bank. Please go ahead. Good evening, Larry and Shaman. I have a question about the offline extension, because it is noted that the intro is uploaded, possibly related to offline extension, I guess. Could you please share some insights on the progress of offline extension? For instance, how many cities have been entered? How many centers have been opened so far? How is the student enrollment in the city?

Alice Cai: The first question today comes from Alice Kai with City Bank. Please go ahead. Good evening, Larry and Shalant. I have a question about the offline extension, because it is noted that the intro is uploaded, possibly related to offline extension, I guess. Could you please share some insights on the progress of offline extension? For instance, how many cities have been entered, how many centers have been opened so far? How is the student enrollment in the city? Can it come out and be appreciated? Thank you. Thanks, Alice. You were asking about our offline business expansion progress and the numbers of living centers, right?

Speaker Change #110: Price is strategic being though to increase the student scale. For the students, the main contribution to Sway is God's brilliance instead of revenues.

Speaker Change #110: and the revenue contribution will be present in Q4.

Shannon: We could continuously predict the revenue growth rate in Q4 by referring to our Q3 growth buildings, growth rates together with the Q1 and Q2 growth buildings. This is also the typical seasonality of the online, large-life class business model. The combined effect of these reasons causes our revenue guidance to fall within the currently indicated range. And I think your second part of your question indicates the breakdown of our offline revenues, contribution, and online revenues, contribution. So, as I believe here, the offline revenues, contribution, contribution is not synchronized and enough to be disclosed separately. So majority of the contribution of revenue and growth buildings were contributed by our online business.

Speaker Change #111: We could continuously predict the revenue growth rating in Q4 by referring to our Q3 growth buildings, growth rates that gather raise the Q1 and Q2 growth ratings. This is also the typical seasonality of the online large live-class business model.

Speaker Change #111: The combining facts of these reasons causes our revenue guidance to fall resilient, the current related data range. And I think your second part of your question indicate the breakdown of our offline revenues, contribution and online revenues contributions.

Alice Kai: Can it kind of be appreciated? Thank you. Thanks, Alice. You were asking about our offline business expansion progress and the numbers of living centers, right? And we are very glad to share the progress we have made on our offline business.

Speaker Change #112: So, I was up late here. The offline revenue contribution is not a single-napy kind enough to be discolored separately. So, majority of the country's bills should not grab anyone, go to the needs of a country, what contributed by our online business.

Larry: We are very glad to share the progress we have made on our offline business, relying on the brand recognition and the industry influence of our Founder Larry, a highly efficient and professional team was rapidly assembled in the first half in 2024, providing a strong foundation for our offline operations. Therefore, the extension of learning centers both in terms of city coverage and the number of learning centers has significantly exceeded our expectations at the beginning of the year. At the same time, the business is progressing steadily and rapidly with notable achievements across a lot of tasks.

Unknown Executive: Relying on the brand recognition and the industry influence of our founder Larry, a highly efficient and professional team was rapidly assembled in the first half in 2024, providing a strong foundation for our offline operations. Therefore, the extension of learning centers both in terms of city coverage and the number of learning centers has significantly exceeded our expectations at the beginning of the year. At the same time, the business is progressing steadily and rapidly with multiple achievements across a lot of tasks.

Shannon: Thanks, Summer. Hope that addresses your questions.

Speaker Change #112: Thank you, Summer. Hope that address your questions.

Unknown Executive: It's very clear.

Unknown Executive: Thank you.

Summer Chen: Office very clear, thank you.

Crystal Li: The next question comes from Crystal Li with CMS. Please go ahead. Thanks, management, for taking my question. So I see you have exceptional new enrollment in this summer reflected by the growth savings growth. Could you elaborate more on the main travel behind this and how about the recognition of this new enrollment?

Summer Chen: The next question comes from Crystal Lee with CNS. Please go ahead.

Crystal Lee: Thank you, Management for taking my question. So I see you have a exceptional new environment in this summer. If you have to decide your across building growth and could you elaborate more on the main driver behind this and how about the recognition of this new

Shannon: And with my second question regarding your marketing strategy going forward, thank you. Sure, thanks a lot.

Unknown Executive: And on the journey of exploring our offline business, we found several key parts where offline and online business can work synergistically. Firstly, in teacher recruitment, we have a strong capability in recruiting top-tier talent from prestigious domestic universities like Beijing, Fujiao, and also other top-notch universities. And our high-quarters recruitment team have been able to across these institutions combined with the ability to share excellent teaching resources to our offline operations, provides critical faculty support for our offline operations in their early stage, which is very important for an offline learning center.

Larry: On the journey of exploring our offline business, we found several key parts where offline and online business can work synergistically. Firstly, in teacher recruitment, we have a strong capability in recruiting top-tier talent from prestigious domestic universities like Beijing, Fujiao, and also other top-notch universities. Our high-quarters recruitment team have been able to across these institutions combined with the ability to share excellent teaching resources to our offline operations, provides critical faculty support for our offline operations in their early stage, which is very important for an offline learning center.

Crystal Lee: and my second question regarding your marketing strategy coming forward. Thank you.

Shannon: Right, actually Q2 is a critical quarter for our business for every year because there are two significant events happening in the second quarter. The first is the retention happened usually at the end of April or in the early part of May. Then, because in the past few years, we keep investing in our teachers, recruitment, and training, and we keep polishing our educational products so that back I just mentioned, you may prepare remarks. We do see our retention rate keeping increasing, especially for our newly joined students. And that's something we really have confidence in our future business.

Speaker Change #115: Share a thanks a lot. Right, actually, tutu is a critical quarter for our business for every year because there were two significant events happening in the second quarter. The first is the retention hasn't usually at the end of April or in the early part of May. Then because in the past few years, we keep inviting in our...

Speaker Change #115: Teachers Recommend and Training and the keep polishing our educational products.

Speaker Change #115: So that I just mentioned the M.A.P.P. remarks, we do see our retention rate, keeping increasing especially for our newly joined students.

Speaker Change #115: and that's something we really have confidence in our future business.

Unknown Executive: This will greatly enhance the quality of our offline education, offering students to improve educational resources, because we all know that teachers are the most successful factors of offline learning centers. And secondly, in terms of educational products and countenance, the meticulously refined online teaching materials, particularly those overlapping with offline education, such as cost wear, can be shared, this could significantly increase the efficiency of our offline education product process. This is only conservative resources, but also ensure that offline teaching is supported by high quality content.

Larry: This will greatly enhance the quality of our offline education, offering students to improve our educational resources because we all know that teachers are the most successful factors of offline learning centers. And secondly, in terms of educational products and countenance, the meticulously refined online teaching materials, particularly those overlapping with offline education, such as cost wear, can be shared, this could significantly increase the efficiency of our offline education product process. This is only conservative resources, but also ensure that offline teaching is supported by high quality content.

Shannon: And essentially important part is the preparation for the summer campaign or usually started in the middle May. And this summer, the education market has shown a vibrant landscape, and we've felt the strong demand firsthand. And to ensure we can fully meet the diverse learning needs of students and parents during the summer, they proactively plan operations to better seize this valuable opportunity. First, in terms of our teacher recruitment training, we understand that excellent teachers are the key to the success of our summer operations. Understanding lead teachers and tutors can provide high-quality educational services, greatly enhancing the learning experience.

Speaker Change #115: and the fascinating important part is the preparation for the summer camping or usually Saturday in the middle May and this summer the education market has shown a vibrant landscape and makes felt the strong demand at first hand.

Speaker Change #116: and Tu Yin Shure, they can fully meet the diverse learning needs of students and parents during the summer, but they practically plan operations to better seize this valuable opportunity.

Speaker Change #117: First, in terms of our teacher recruitment training, we understand that excellent teachers are the key to the success of our summer operations.

Speaker Change #117: of Sandy and Lead Teachers and tutors can provide high-quality, educational services.

Unknown Executive: And also, and most importantly, is our brand awareness. Compared to other brand new offline education brands, our brand holds significant value in demands of parents and students, providing a strong boost to our offline business. However, there are notable differences between offline and online operations will be identified in the past half of the year, offline education products plays a great exercise on localization and personalization. Given our simultaneously expansion into multiple cities and multiple learning centers, current education research efforts are paid to meet the specific needs of students in different regions.

Larry: And also, and most importantly, is our brand awareness. Compared to other brand-new offline education brands, our brand holds significant value in demands of parents and students, providing a strong boost to our offline business.

Shannon: Therefore, we initiate the recruitment of tutors early on this year, followed by comprehensive and systematic training immediately after they join us. Most teachers began their training four to six weeks in advance, focusing on professional skills, teaching methods, and improving their communication skills, and treating up them to be more familiar with our educational products. This several preparation allowed them to approach their summer teaching assignments with greater passion and professionalism.

Speaker Change #117: Gradually enhancing the learning experience therefore, we initiated the recruitment of tutor early on this year, followed by comprehensive and systematic training immediately after they joined us. Most teachers began their training for two six weeks in advance.

Larry: However, there are notable differences between offline and online operations will be identified in the past half of the year. Online education products plays a great exercise on localization and personalization. Given our simultaneously expansion into multiple cities and multiple learning centers, current education research efforts are paid to meet the specific needs of students in different regions. That means we need to invest in localized content at least days, and this is partially explained in the increase in our R&D expenses.

Speaker Change #117: focusing on professional skills, teaching masters and improving their communication skills and train up them to be more familiar with our educational products. This several preparation allowed them to approach their summer teaching assignments with greater passion and the professionalism.

Shannon: And secondly, and also address your second question, in terms of our customer acquisition channels, we've been characterized by a highly diversified approach, particularly in the live training sector, where we've already achieved scalable customer acquisition and also contributed a majority of the customer acquisition leads. Summer, we intensified our investment during the summer. We successfully attracted attention from students and parents. During the summer enrollment, we fully capitalized on the benefits of this diversified channel strategy. Additionally, we actively expanded other channels such as social media and some offline channels to comprehensively cover potential customer groups, thereby increasing brand awareness and influence.

Speaker Change #118: and Secondary and also address a second question in terms of our customer acquisition China will be characterized by a highly diversified approach.

Unknown Executive: That means we need to invest in localized content at this stage, and this is partially explained the increase in our R&D expenses. And also, the operation is quite different as well, if we compare the offline business to the offline business. We need to devise an operational support system, distinct from our online business, requiring investment in product research and development, for example, systems to support set selection and renovation of campus, as well as systems for students who check in and class rescheduling their crop.

Speaker Change #119: particularly in the live streaming sector, where they've already achieved scalable customer acquisition and now also contributed a majority of the customer acquisition they stammer will intensify that when investment during the stammer. We successfully attracted attention from students and parents.

Larry: And also, the operation is quite different as well if we compare the offline business to the offline business. We need to develop an operational support system, distinct from our online business, requiring investment in product research and development. For example, systems to support set selection and renovation of campus, as well as systems for students to check in and class with scheduling exactly.

Speaker Change #119: During the summer year, Roman, we fully capitalised on the benefits of this diversified channel strategy. Additionally, we actively expanded other channels, such as social media and some offline channels to comprehensively cover potential customer groups.

Unknown Executive: These significant differences in operation details between online and offline business make a comprehensive operational support system crucial for our multiple locations and multiple campus expansion. Such a system will significantly enhance operational efficiency and ensure that our operation in offline business will be successful. At the same time, we fully recognize that the entry barriers for offline business are very high and the mode is deep. Building systems for teacher recruitment and training, principal cultivation, educational products and operational support requires a long, long cycle.

Larry: These significant differences in operation details between online and offline business make a comprehensive operational support system crucial for our multiple locations and multiple campus expansion. Social system will significantly enhance operational efficiency and ensure that our operation in offline business will be successful. At the same time, we fully recognize that the entry barriers for offline business are very high and the mode is deep. Building systems for teacher recruitment and training, principal cultivation, educational products and operational support requires a long, long cycle. And we do not underestimate the challenge of establishing recognition and reputation among students and parents as a new ancient. Now we overlook the time and cost of team integration and development.

Shannon: So, through these strategic and operational measures, we successfully achieved the expected growth in students' environments, and we've been able to maintain a favorable level of a return on investment of our sales and marketing expenses, as you can account on our PLNL and the opening metrics we will provide it. Based on the information provided by the third parties, because we always do channel tracks during the summer vacation, we found our customer acquisition cost remains relatively low within the industry, and this not only reflects the effectiveness of our operational strategies, but also gives us a competitive edge in the market.

Speaker Change #119: thereby increasing brand awareness and influence.

Speaker Change #119: So, through these strategic and operational measures, we successfully achieved the expected girl seeing still to the end of the year and will be able to maintain a favorable level of return on investment of our sales and marketing expenses as...

Speaker Change #120: You can count on our PLNL and the operating matrix will provide it.

Speaker Change #120: and the information provided by our sub-parties, because we always do channel tracks during the summer of occasions, we've found our customer acquisition costs remain relatively low within the industry. And this is not only reflects the effectiveness of our operational strategies, but also gives us a competitive edge in the market.

Unknown Executive: We do not underestimate the challenge of establishing recognition and reputation among students and parents as a new ancient. Now we overlook the time and cost of team integration and development. However, we are deeply committed to our offline business strategy, with a high level of patience and determination.

Shannon: So, we will continue to optimize our operational, our operations to provide even better educational services to students and parents, and for our customer acquisition channels, we will further to optimize the structure of the channels, and we make sure, like the low cost channels and more private track channels will contribute in more student-eulomance in the future. Thanks, Crystal.

Speaker Change #120: So we will continue to optimize our operations to provide even better educational services to student and parents.

Larry: However, we are deeply committed to our offline business strategy with a high level of patience and determination. The current investment is of great importance for our long-term growth but of family when the time is right and when our offline revenue contribution reaches a certain level of significance we will begin disclosing relevant all-perish metrics including the cities we enter and also the numbers of our learning centers and that can help us to gain a more comprehensive understanding of the progress of our offline business in the future. Thanks Alice.

Crystal Lee: and for our Tasamayah position, China, we will flutter to optimize the structure of the China and we make sure the low cost of China and more private tribes of China will contribute more to the enrollment in the future. Thanks, Crystal.

Unknown Executive: The current investment is of great importance for our long-term growth, but of family, when the time is right and when our offline revenue contribution reaches a certain level of significance, we will begin disclosing relevant all-priced metrics, including the cities we enter and also the numbers of our learning centers in that that can help us to gain a more comprehensive understanding of the progress of our offline business in the future. Thanks, Alice.

Unknown Executive: Thanks, Chan, and that's very helpful.

Crystal Lee: Thanks, Shannon, let the rehearsal.

Unknown Executive: This concludes our question and answer session.

Crystal Lee: This concludes our question and answer session. I would like to turn the conference back over to Katherine for any closing remarks.

Katherine Chen: I would like to turn the conference back over to Catherine for any closing remarks. Thank you, operator, and thank you, everyone, for joining the call today. If you have any further questions, please don't hesitate to contact our Invest Relations Department, or our management via email at irat.gov.c and directly. You are also welcome to subscribe to our news alert on the company's IR website. Thank you very much again for your time.

Speaker Change #121: Thank you, operator, and thank you everyone for joining the core today. If you have any further questions, please don't hesitate to contact our Invest Relations Department or on management via email app via IR at go to the CNDRACME.

Timothy Zhao: The next question comes from Timothy Zhao with Goldman Sachs. Please go ahead. Great.

Timothy Zhao: The next question comes from Timothy Zhao with Goldman Sachs. Please go ahead. Great.

Speaker Change #121: You are also welcome to subscribe to our news alert on the company's IR website. Thank you very much again for your time. Have a great night.

Larry: Thank you, my friend, for taking my question. I think in Europe, Paramount, you mentioned about the AI. So my question is regarding the AI empowerment in education. Just wondering what is the measurement view and what is your strategy in this field for different business segments and how much potential offline efficiency gains do you think AI will bring to your business. Thank you. Thanks, Timothy.

Unknown Executive: Thank you, my friend for taking my question. I think in Europe, Paramount, you mentioned about the AI. So my question is regarding the AI empowerment in education. Just wondering what is the measurement view and what is your strategy in this field for different business segments. And how much potential of an efficiency gains do you think AI will bring to your business? Thank you. Thanks, Timothy. This is a very good question and the whole management team pay a lot of attention in the most recent update on the artificial intelligence.

Unknown Executive: Have a great night. Thanks.

Unknown Executive: The conference is now concluded. Thank you for attending today's presentation.

Speaker Change #121: Dad!

Speaker Change #122: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.

Unknown Executive: You may now disconnect.

Larry: This is a very good question and the whole management team pay a lot of attention in the most recent update on the artificial intelligence. So it's a rapid development of AI technology and the continuous evolution and development of AI forms in various industries recently. We have a more profound and clear understanding of the application of artificial intelligence and very personally visited in the United States and personally meet a couple of entrepreneurs in the Silicon Valley to get the most recent knowledge about artificial intelligence.

Unknown Executive: So it's the rapid development of AI technology and the continuous evolution and development of AI forms in various industries recently. We have a more profound and clear understanding of the application of artificial intelligence and very personally visited in the United States and personally meet a couple of entrepreneurs in the Silicon Valley to get the most recent knowledge about artificial intelligence. So currently, AI has been widely used in quite a few aspects of our business.

Larry: So currently, AI has been widely used in quite a few aspects of our business and the current applications are mainly focused on internal cost reduction and efficiency improvement. Firstly, in the field of teaching product design and research and development, artificial intelligence can help our designers improve efficiencies very well, like automatic corrections of the students homework. And AI oral language practice that the students can talk to the app or the programs on their way chat and to do the daily oral practice.

Unknown Executive: And the current applications are mainly focused on internal cost reduction and efficiency improvement. Firstly, in the field of teaching product design and research and development, artificial intelligence can help our designers improve efficiency very well. Like automatic corrections of the student's homework and AI oral language practice that the students can talk to the app or the programs on their way chat and to do the daily oral practice. And also, the design of more interactive AI teaching products are used to assist all our teachers and our teachers to provide more personalized learning of our existing students.

Unknown Executive: But currently, a majority of our product will provide it to our existing students instead of promoting them to the new students because we want them to be polished and we want to make sure they can create incremental value to our students before they promote them to the market. And secondly, in the link of Internet product research and development, AI has significantly improved the efficiency in front and research and development, including our internal instant message system and also other internal efficiency tools where I'll apply AI technology to improve our office efficiency.

Larry: And also the design of more interactive AI teaching products are used to assist our teachers and our teachers to provide more personalized learning of our existing students. But currently, a majority of our product will provide it to our existing students instead of promoting them to the new students because we want them to be polished and we want to make sure they can create an incremental value to our students before they promote them to the market.

Larry: And secondly, in the link of Internet product research and development, AI has significantly improved the efficiency in front and research and development, including our internal instant message system and also other internal efficiency tools where I'll apply AI technology to improve our office efficiency. Finally, in other operational links such as constructions of customer service and automatic responses, AI is also playing an important role in reducing cost and improving efficiency in different links.

Unknown Executive: Finally, in other operational links such as constructions of customer service and automatic responses, AI is also playing an important role in reducing cost and improving efficiency in different links. So we believe in the future as the top technology develops. Our artificial intelligence can create a huge value to our company. But right now, we want the investment in this field to be.., to be more conservative. Right now we only use it to improve our internal efficiency at this stage. Thanks, Timothy. Thank you, Shannon.

Larry: So we believe in the future as the top technology develops. Our artificial intelligence can create a huge value to our company. But right now, we want the investment in this field to be to be more conservative. Right now, we only use it to improve our internal efficiency at this stage. Thanks, Timothy.

Unknown Executive: Thank you, Shannon.

Summer Chen: The next question comes from Summer Chen with CLSA. Please go ahead. Thank you for taking that question and the congratulations, congratulations, congratulations on our strong quarter.

Summer Chien: The next question comes from Summer Chien with CLSA. Please go ahead.

Shannon: Thank you for taking that question and the congratulations, congratulations, congratulations on our strong corner. My question is that we started counting, Shannon? My question is that we see the standards that of course three will be a faster growth quarter, so can we share more color about the revenue growth? Breakdown for course three. Online offline and then five in a second. Thank you. Thanks, Summer. We wouldn't be able to hear clearly, but I guess you were asking about the revenue guidance for the next quarter.

Unknown Executive: My question is that we start in Canada, Shannon. My question is that we see the standards that of course we will be a first of both quarter, so Canada share more color about the revenue growth rate down 403 online online and then five in a second. Thank you. Thanks, Summer. We wouldn't be able to hear clearly, but I guess you were asking about the revenue guidance for the next quarter. Yeah, and I do think the guidance should be diving into the numbers of the play.

Shannon: Yeah, and I do think the guidance should be diving into the numbers of the play. So as of now, our hospital in the first half of the year is approximately 2.4 billion. With a year-old year growth rate of about 67.7 percent, and the before revenue balance increased over 30 percent year-old year, that all indicated a higher revenue growth rate in the third quarter, right? And the upper limit of revenue guidance we provided in the earnings release is 1.208 billion.

Unknown Executive: So as of now, our hospitalings in the first half of the year is approximately 2.4 billion. There is a year-over-year growth rate of about 67.7%, and the before revenue balance increased over 30% year-over-year. That all indicated a higher revenue growth rate in the third quarter, right? And the upper limit of revenue guidance we provided in the earnings release is 1.208 billion, with a year-over-year growth rate of 33%. It appears that the growth rate of growth buildings is much higher than that revenue.

Shannon: With a year-old year growth rate of 53 percent, it appears that the growth rate of growth buildings is much higher than that revenue. There are mainly two reasons for this. And first, the class schedule in September, which is the last month in the Q3, has one last weekend compared to 2023, which negatively impacts the year-old year growth rate by approximately five percenting points, and the related revenue will be recognized in Q4.

Unknown Executive: There are mainly two reasons for this. And first, the class schedule in September which is the last month in the Q3 has one last weekend compared to 2023, which negatively impacts the year-over-year growth rate by approximately five percentage points, and the related revenue will be recognized in Q4. And secondly, we conducted some special price class operations for entrance level grade during the summer course, seizing the price strategic window to increase the student scale.

Shannon: And secondly, they conducted some special price class operations for entrance level grade during the summer course, seizing the prices strategic window to increase the student scale. For these students, the main contribution to Q3 is growth buildings instead of revenues, and the revenue contributions will be present in Q4. We could continuously predict the revenue growth rate in Q4 by referring to our Q3 growth buildings, growth rates together with the Q1 and Q2 growth buildings.

Unknown Executive: For these students, the main contribution in Q3 is growth buildings instead of revenues. And the revenue contributions will be present in Q4. We could continuously predict the revenue growth rate in Q4 by referring to our Q3 growth buildings, growth rates together raise the Q1 and Q2 growth buildings. This is also the typical seasonality of the online large-life class business model. The combined effects of these reasons causes our revenue guidance to fall within the current late indicated range.

Shannon: This is also the typical seasonality of the online, large-life class business model. The combined effect of these reasons causes our revenue guidance to fall within the currently indicated range. And I think your second part of your question indicates the breakdown of our offline revenues, contribution, and online revenues, contribution. So, as I believe here, the offline revenues, contribution, contribution is not synchronized and enough to be disclosed separately. So majority of the contribution of revenue and growth buildings were contributed by our online business. Thanks, Summer. Hope that address your questions.

Unknown Executive: And I think your second part of your question indicates the breakdown of our offline revenues contribution and online revenues contribution. So, as I believe here, the offline revenues contribution is not synchronized enough to be disclosed separately. So, majority of the contribution of revenue and growth buildings were contributed by our online business. Thanks, Summer. Hope that address your questions. It's very clear. Thank you.

Unknown Executive: It's very clear. Thank you.

Crystal Lee: The next question comes from Crystal Lee with CMS. Please go ahead. Thanks, management for taking my question. So, I see you have exceptional new enrollment in this summer, reflected by your growth savings growth. And could you elaborate more on the main travel behind this and how about the return of this new enrollment? And with my second question regarding your marketing strategy coming forward, thank you. Sure, thanks a lot.

Crystal Li: The next question comes from Crystal Li with CMS. Please go ahead. Thanks, management for taking my question. So I see you have exceptional new enrollment in this summer reflected by the growth savings growth.

Shannon: Could you elaborate more on the main travel behind this and how about the recognition of this new enrollment? And with my second question regarding your marketing strategy going forward, thank you. Sure, thanks a lot.

Shannon: Right, actually Q2 is a critical quarter for our business for every year because there are two significant events happening in the second quarter. The first is the retention happened usually at the end of April or in the early part of May. Then because in the past a few years, we keep investing in our teachers, recruitment, and training, and we keep polishing our educational products so that back I just mentioned, you may prepare remarks.

Unknown Executive: Right, actually, Q2 is a critical quarter for our business for every year because there were two significant events happening in the second quarter. The first is the retention haven't usually at the end of April or in the early part of May, then because in the past few years, we keep investing in our teachers' recruitment and training and we keep polishing our educational products so that I just mentioned you may prepare marks.

Shannon: We do see our retention rate keeping increasing, especially for our newly joined students. And that's something we really have confidence in our future business. And essentially important part is the preparation for the summer campaign or usually started in the middle May. And this summer, the education market has shown a vibrant landscape and we've felt the strong demand firsthand. And to ensure we can fully meet the diverse learning needs of students and parents during the summer, they proactively plan operations to better seize this valuable opportunity.

Unknown Executive: We do see our retention rate keeping increasing, especially for our newly joined students. And that's something we really have confidence in our future business. And the second important part is the preparation for the summer campaign or usually started in the middle May. And this summer, the education market has shown a vibrant landscape and we've felt the strong demand firsthand. And to ensure we can fully meet the diverse learning needs of students and parents during the summer they proactively plan operations to better see this valuable opportunity.

Unknown Executive: First, in terms of our teacher recruitment training, we understand that excellent teachers are the key to the success of our summer operations. Of sending lead teachers and tutors can provide high quality educational services, greatly enhancing the learning experience. Therefore, we initiate the recruitment of tutors early on this year, followed by comprehensive and systematic training immediately after they joined us. Most of the teachers began their training four to six weeks in advance, focusing on professional skills, teaching methods and improving their communication skills and training up them to be more familiar with our educational products.

Shannon: First, in terms of our teacher recruitment training, we understand that excellent teachers are the key to the success of our summer operations. Understanding lead teachers and tutors can provide high quality educational services, greatly enhancing the learning experience. Therefore, we initiate the recruitment of tutors early on this year, followed by comprehensive and systematic training immediately after they join us. Most teachers began their training four to six weeks in advance, focusing on professional skills, teaching methods, and improving their communication skills, and treating up them to be more familiar with our educational products. This several preparation allowed them to approach their summer teaching assignments with greater passion and professionalism.

Unknown Executive: This several preparation allowed them to approach their summer teaching assignments with greater passion and professionalism. And secondly, and also address our second question, in terms of our customer acquisition channels, we've been characterized by a highly diversified approach, particularly in the live streaming sector where we've already achieved scalable customer acquisition and also contributed a majority of the customer acquisition leads summer, we intensified our investment during the summer. We successfully attracted attention from students and parents during the summer enrollment, we fully capitalized on the benefits of this diversified channel strategy.

Shannon: And secondly, and also address your second question, in terms of our customer acquisition channels, we've been characterized by a highly diversified approach, particularly in the live training sector, where we've already achieved scalable customer acquisition and also contributed a majority of the customer acquisition leads summer, we intensified our investment during the summer. We successfully attracted attention from students and parents. During the summer enrollment, we fully capitalized on the benefits of this diversified channel strategy.

Unknown Executive: Additionally, we actively expanded other channels such as social media and some offline channels to comprehensively cover potential customer groups, thereby increasing brand awareness and influence. So through these strategic and operational measures, we successfully achieved the expected growth in student environments, and we've been able to maintain a favorable level of a return on investment of our sales and marketing expenses as you can count on our PNL and the opening metrics we will provide it.

Shannon: Additionally, we actively expanded other channels such as social media and some offline channels to comprehensively cover potential customer groups, thereby increasing brand awareness and influence. So, through these strategic and operational measures, we successfully achieved the expected growth in students' environments, and we've been able to maintain a favorable level of a return on investment of our sales and marketing expenses as you can account on our PLNL and the opening metrics we will provide it.

Shannon: Based on the information provided by the third parties, because we always do channel tracks during the summer vacation, we found our customer acquisition cost remains relatively low within the industry, and this is not only reflects the effectiveness of our operational strategies, but also gives us a competitive edge in the market. So, we will continue to optimize our operational, our operations to provide even better educational services to students and parents, and for our customer acquisition channels, we will further to optimize the structure of the channels, and we make sure, like the low cost channels and more private track channels will contribute in more student-eulomance in the future. Thanks, Crystal. Thanks, Chan, and that's very helpful.

Unknown Executive: Based on the information provided by our third parties because we always do channel tracks during the summer vacation, we found our customer acquisition cost remains relatively low within the industry, and this is not only reflects the effectiveness of our operational strategies but also gives us a competitive edge in the market. So we will continue to optimize our operational operations to provide even better educational services to students and parents, and for our customer acquisition channels, we will further to optimize the structure of the channels, and we make sure like the low cost channels and more private track channels will contribute in more student environments in the future. Thanks, Crystal. Thanks, Chen, and that's very helpful.

Unknown Executive: This concludes our question and answer session.

Unknown Executive: This concludes our question and answer session.

Katherine Chen: I would like to turn the conference back over to Catherine for any closing remarks.

Katherine Chen: I would like to turn the conference back over to Catherine for any closing remarks.

Katherine Chen: Thank you, operator, and thank you, everyone, for joining the call today. If you have any further questions, please don't hesitate to contact our Invest Relations Department, or on management via email at IR at go2.c and directly. You are also welcome to subscribe to our news alert on the company's IR website. Thank you very much again for your time. Have a great night. The conference is now concluded. Thank you for attending today's presentation.

Katherine Chen: Thank you, operator, and thank you, everyone, for joining the call today. If you have any further questions, please don't hesitate to contact our Invest Relations Department, or our management via email at irat.gov.c and directly. You are also welcome to subscribe to our news alert on the company's IR website. Thank you very much again for your time. Have a great night. Thanks.

Unknown Executive: The conference is now concluded. Thank you for attending today's presentation.

Unknown Executive: You may now disconnect.

Unknown Executive: You may now disconnect.