Q2 2024 uCloudlink Group Inc Earnings Call
[inaudible]
Operator: Good day, and welcome to the Ucloudlink Second Quarter 2024 Earnings Conference Call. All participants will be in a listen-only mode.
Zeng Shi, Chaohui Chen, Yimeng Shi, Yimeng Shi, Yimeng Shi, Yimeng Shi, Yimeng Shi,
Speaker Change: Good day and welcome to the Ucloudlink 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 0. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then 1 on your touchtone phone.
Operator: Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then 1 on your touchtone phone. To withdraw your question, please press star then 2.
Operator: Please note this event is being recorded. I would now like to turn the conference over to Daniel Gao, Investor Relations Director. Please go ahead.
Speaker Change: To withdraw your question, please press star then 2.
Speaker Change: Please note this event is being recorded.
Speaker Change: I would now like to turn the conference over to Daniel Gao, Investor Relations Director. Please go ahead.
Daniel Gao: Okay, thank you. Hello, everyone, and thank you for joining us on Uclink's second quarter 2024 earnings call. The earnings release and our release presentation are now available on our IR website at ir.uclink.com. Joining me on today's call are Mr. Zhiping Peng, Co-founder and Chairman of the Board of Directors, Mr. Chaohui Chen, Co-founder, Director, and Chief Executive Officer, and Mr. Yimeng Shi, Chief Financial Officer. Mr. Chen will begin with an overview of our recent business highlights.
Daniel Gao: Okay, thank you.
Daniel Gao: Hello everyone and thank you for joining us on Ucloudlink's second quarter 2024 earnings call. The earnings release and our release presentation are now available on our IR website at ir.ucloudlink.com.
Daniel Gao: Mr. Shi will then discuss our financial and operational highlights for the quarter. They will both be available to take your questions in the Q&A section that follows. Before we proceed, please note that this code may contain forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on measurements, current expectations, and observations that involve known and unknown risks, uncertainties, and other factors not under the company's control, which may cause actual results, performance, or treatments of the company to be massively different from the results, performance, or expectations implied by those All forward-looking statements are expressly qualified in their entirety by their contrary statements, risk factors, and details of the company's feelings with the SEC.
Daniel Gao: Kun
Speaker Change: Joining me on today's call are Mr. Zhiping Peng, Co-Founder and Chairman of the Board of Directors, Mr. Chaohui Chen, Co-Founder, Director and Chief Executive Officer, and Mr. Yimeng Shi, Chief Financial Officer.
Speaker Change: Mr. Chen will begin with an overview of our recent business highlights. Mr. Shi will then discuss our financial and operational highlights for the quarter. They will both be available to take your questions in the Q&A section that follows.
Speaker Change: Before we proceed, please note that this code may contain forward-looking statements made pursuant to the safe harbor provisions of the Privy Secretary's Litigation Reform Act of 1995.
Speaker Change: These four looking statements are based on measurements, current expectations and observations that involve known and unknown risks.
Speaker Change: uncertainties and other factors not under component control.
Speaker Change: which may cause actual results, performance, or treatments of their components to be massively different from the results, performance, or expectations implied by those forward-looking statements.
Speaker Change: All four looking statements are expressly qualified in their entirety by their contrary statements, risk factors, and details of the company's feelings with the SEC.
Speaker Change: The company does not assume any obligation to revise or update any forward-looking statements as a result of new information, future events, changes in market conditions, or otherwise, except as required by law.
Speaker Change: Please also note that Euclid's earnings press release and this conference call include the discussions of outdated GAP financial information and outdated non-GAP financial methods.
Speaker Change: Euclid's press release contains a reexamination of the audited non-GAP methods to the most directly comparable audited GAP methods. I will now turn the call over to Mr. Chen.
Daniel Gao: The company does not assume any obligation to revise or update any forward-looking statements as a result of new information, future events, changes in market conditions, or otherwise, except as required by law. Please also note that Ucloudlink's earnings press release and this conference call include discussions of audited GAP financial information and audited non-GAP financial methods. Ucloudlink's press release contains a reexamination of the audited non-GAP methods to the most directly comparable audited GAP methods. I will now turn the call over to Mr. Chen. Please go ahead.
Chaohui Chen: Thank you, Daniel. And good morning or evening, everyone. Continuing the stories that we have heard this year, Glow's momentum carried into the second quarter, with total revenue reaching US$22.4 million, in line with the guidance. Our financial position is improving, with net income reaching US$2.2 million and operating cash flow increasing 38.3% year-over-year to US$4.7 million. In the second quarter of 2024, aside from our global Mi Mobile 6 broadband business, we will offer comprehensive data connections, solutions, and business.
Mr. Chen: Please go ahead. Thank you, Daniel. And good morning or evening everyone.
Mr. Chen: Continuing the solid start we had early in this year, growth momentum carried into the second quarter, with the total revenue reaching US$22.4 million, in line with the guidance.
Speaker Change: Our financial position is improving, with net income reaching US$2.2 million.
Speaker Change: and operating cash flow increasing 38.3% year-over-year to U.S. dollars 4.7 million.
Speaker Change: In the second quarter of 2024, aside from our global Mi Mobile 6 broadband business,
Chaohui Chen: Lines and business lines such as GroKoMeLine, GroKoMeTheme, and GroKoMeIoT have made consistent progress in expanding beyond the travel sector into various aspects of daily life with an expanded array of comprehensive data connectivity solutions to satisfy a wider range of our needs.
Speaker Change: Comprehensive Data Connection Solutions and Business
Speaker Change: lines and business lines such as Glocomy line, Glocomy theme and Glocomy IoT.
Speaker Change: have made consistent progress in expanding beyond the travel sector into various aspects of daily life with an expanded array of comprehensive data connectivity solutions.
Chaohui Chen: Firstly, let me start with the progress we have made in our GlocoMe Mobile Fixed Ball Bank Business Line. R1.0, information on data connectivity services. Associates' business continued to grow in the second quarter of year 2024, further consolidating our leadership position in the long-run market and expanding our market share, as the widespread adoption of our food-speak 5G solutions gains momentum, supported by the Recovery in International Travel, our extensive financial domain solution.
Speaker Change: [inaudible]
Speaker Change: Firstly, let me start with the progress we have made in our Global Me Mobile fixed broadband business line. Our 1.0 international data connectivity services
Speaker Change: This business continues to grow in the second quarter of the year 2024, further consolidating our leading position in the long-mean market and expanding our market share.
Speaker Change: as the widespread adoption of our full-speed 5G solutions gains momentum.
Chaohui Chen: Now they cover 50 countries and reach it, and are generating a stable stream of revenue, creating significant growth opportunities for us to go forward, according to the more 2024 report from the Global System for Mobile Communication Association, or CSMA. The global number of 5G connections is expected to rise to 5.5 billion by 2030, from 1.6 billion at the end of 2023. Second, our Glaucoma Live solution made significant progress in the second quarter of 2024. We officially launched three Glaucoma Live solutions in May at Viva Technology 2024 in Paris.
Speaker Change: Supported by the recovery in international travel, our extensive 5G low-means solution now covers 50 countries and regions.
Speaker Change: and are generating a stable stream of revenue.
Speaker Change: Creating significant growth opportunities for...
Speaker Change: Huah, go in for me. According to the more bad economic...
Speaker Change: 2024 report from the...
Speaker Change: Global System for Mobile Communication Association, or CSMA The global number of 5G connections is expected to rise to 5.5 billion by 2030 from 1.6 billion at the end of the year
Speaker Change: 2,223.
Speaker Change: Second, our Glucomin Live solution made significant progress in the second quarter of the year 2024. We officially launched three Glucomin Live solutions in May at the Viva Technology 2024 in Paris.
Chaohui Chen: The Nine-Up of New Solutions The Nine-Up of New Solutions, consisting of Qi Chaka, [inaudible] Long-Plat Unicorp, has not only showcased our innovative capabilities but also garnered widespread acclaim in the market, making the beginning of a promising new revenue stream going forward, with the unique multi-network, multi-base station, positioning, and the active radar, reach for up to 100 meters. Our key checker is technology, a head-of-the-competition, with its six other ones, the ones positioned in technology, including GTS, ACTS, LPS, Y5, Bluetooth, and XT radar. A long means card is morning just a universal chevver adapter.
Speaker Change: [inaudible]
Speaker Change: consisting of key checker
Speaker Change: Long-term Unicorp has not only showcased our innovative capabilities, but also garnered widespread acclaim in the market.
Speaker Change: making the beginning of a promising new revenue stream going forward with the unique multi-network, multi-base station, positioning and the IP radar reach for up to 100 Mbps.
Speaker Change: Our key factor is technology ahead of the competition.
Speaker Change: with its 6-in-1 positioning technology.
Speaker Change: including GPS.
Speaker Change: ADPS, LPS, Wi-Fi, Bluetooth, and active radar. A low-mean plant is more than just a universal travel adapter.
Chaohui Chen: It is an all-in-one device that combines smart charging technology, four charging ports, including three USB-C and one USB-A, and a built-in mobile Wi-Fi module. Unicore is a dual-head USB-C cable with built-in mobile Wi-Fi capability. LongPlanet and Unicore make great local and global travel companions to charge, and the Connect device, while also providing reliable internet connectivity without the need to carry bulky hardware. Global Midlife Solutions allows people to stay connected to their loved ones.
Speaker Change: It is an all-in-one device that combines smart charging technology, 4 charging ports including 3 USB-C and 1 USB-A, and a built-in mobile Wi-Fi module.
Speaker Change: Unicore is a built-in USB-C cable with built-in mobile Wi-Fi capabilities.
Speaker Change: Long-cut and the unicorn makes great local and global clever companion to charge it.
Speaker Change: and the connected devices.
Speaker Change: while also providing reliable internet connectivity without the need to carry a bulky hardware.
Speaker Change: Glucomy live solutions allow people to stay connected to their loved ones.
Chaohui Chen: Timelessly offering connectivity to various high-floor-conceased daily life applications scenarios, such as task management, item checking, as well as emerging communication. These solutions are expected to contribute more revenues in the coming quarters as we gradually extend this revenue stream with the recurring subscription and services revenue. We continue to gradually expand the availability of our global meat-thinning solutions, including over-the-air, OTA-thin, and e-thin solutions, in more countries and regions. Powering the Way for More Powerful All-Themes Solutions that will allow us to engage with a broader user base
Speaker Change: seamlessly offering connectivity to various high-frequency daily life application scenarios, such as pet management, iPhone checking, as well as emerging communications.
Speaker Change: These solutions are expected to contribute more revenues in the coming quarters as we gradually extend this revenue stream with the recurring subscription and services revenue.
Speaker Change: Sid
Speaker Change: We continue to gradually expand the availability of our global me-themed solutions, including over-the-air, OTA-themed, and e-themed solutions in more countries and regions.
Speaker Change: paving the way for more powerful all-thin solutions that will allow us to engage with a broader and user base.
Chaohui Chen: Our all-themes solutions, which consolidate OTA-themes, e-themes, and cloud-themes, are uniquely positioned to break cross-carrier restrictions in Power Various Magpung and set a new pioneer industry benchmark for mobile connectivity and convenience when they launch in the near future.
Speaker Change: Our all-theme solutions which consolidate OTA theme, e-theme, and cloud theme are uniquely positioned to break cross-carrier restrictions.
Speaker Change: empower various smartphones and set a new pioneer industry benchmark for mobile connectivity and convenience when they launch in the near future.
Chaohui Chen: According to the Mobile Economic 2024 report from the GSMA, SIM connections, excluding licensed cellular IoT, are expected to increase from $8.6 billion in 2023 to $9.8 billion by 2030. In our global meet, I also feel this is not... We are leveraging our soft cloud SIEM technology, which is compatible with various chipset platforms, to engage you with a broader spectrum of partners in the security camera, that's for cameras, and the related sectors to explore additional applications in our area.
Speaker Change: according to the Mobile Economics.
Speaker Change: 2024 report from the GSNA.
Speaker Change: SIM connection, excluding licensed cellular IoT, are expected to increase from $8.6 billion in 2023 to $9.8 billion by 2030.
Speaker Change: In our local meet, IOT Businessman.
Speaker Change: We are leveraging our software cloud-themed technology.
Yimeng Shi: compatible with various chipset platforms to engage with a broader spectrum of partners in a security camera, dashboard camera, and the related sectors to explore additional application scenarios.
Chaohui Chen: This will allow us to demonstrate the strengths and capabilities of our technology to a broader audience. According to the Mobile Economics 2024 report from the GSMA, licensed cellular IoT connections are expected to grow from 3.5 billion in the year 2023 to 5.8 billion by 2030.
Yimeng Shi: This will allow us to demonstrate the strengths and capabilities of our technology to a broader audience.
Speaker Change: According to the Mobile Economics 2024 report from the GSMA, licensed cellular IoT connections are expected to grow from 3.5 billion in year 2023 to 5.8 billion by 2030.
Chaohui Chen: Finally, as we transition beyond the portable Wi-Fi terminal market, we are scaling up our user base beyond the travel sector into very comprehensive, daily live application scenarios, such as Adderley Care, Pet Management, Item Checking, and Daily Travel. This transition will diversify our revenue stream from the primary mobile data traffic solutions to a mix of value-added services and mobile data traffic solutions. This will drive ongoing consolidation and development of our global ecosystem, positioning it as a leading global mobile data traffic-sharing marketplace while creating long-term sustainable value for our shareholders. We firmly believe that better connection empowers better life, and with the gradual commercialization of global community lines, we are seeing IoT business lines gaining momentum.
Speaker Change: Finally
Speaker Change: As we transition beyond the portable Wi-Fi terminal market, we are scaling up our user base.
Speaker Change: beyond the travel sector into a various comprehensive daily life application scenarios such as elderly care, pet management, item checking, and daily travel.
Speaker Change: This transition will diversify our revenue stream from the primary mobile data traffic solutions to a mix of value-added services and mobile data traffic solutions.
Speaker Change: This will drive ongoing consolidation and development of our SoCoMe ecosystem.
Speaker Change: positioning it as a leading global mobile data traffic-sharing marketplace while creating a long-term sustainable value for our shareholders
Speaker Change: We firmly believe that better connection empowers better life.
Speaker Change: with the gradual commercialization of GCC and IoT business lines gaining momentum.
Chaohui Chen: We expect to see them contribute more meaningfully to revenue in the coming quarter through various markets and channels. We are confident that we have the right strategy in place to generate sustainable growth in the coming quarter for the third quarter of year 2024. We expect its total revenues to be between U.S. dollar 24.0 million to U.S. dollar 28 million, representing an increase of 0.4% to 17.2% compared to the same period of year 2023. I will now turn the call over to Mr. Shi.
Speaker Change: We expect to see them contribute more meaningfully to revenue in the coming quarter through various markets and channels.
Speaker Change: We are confident that...
Speaker Change: We have a right strategy in place to generate sustainable growth in the coming quarters.
Yimeng Shi: Thank you, Mr. Chen. Hello everyone, I will go over our operational and financial highlights for the second quarter of 2024. Our daily active terminal is an important operating metric for us as it measures customer usage trends for each period, which is reflective of our business performance. Our Daily Active Terminal, DAT, in the second quarter was... 306,289, of which 62.2% were from Ucloudlink 1.0 International Data Connectivity Service, representing an increase of 29% in DAT of 1.0 International Data Connectivity Service, prepared for the same period of 2023. The average daily data usage per terminal was 1.35 gigabytes in June 2024.
Speaker Change: 62, 2% were from <unk> one.
Speaker Change: One point, though in the National data connectivity service, representing an increase of 29% in D. T 1.0 International data connectivity service compared to the same series of Tucson 'twenty story.
Speaker Change: However, 36 Katonah was 175 gigabytes in June 2024.
Yimeng Shi: As of June 30, 2024, the company serves 2,699 business partners in 61 countries and regions. The company has 182 patents, with 153 approved and 29 pending approval, and a pool of SIM cards from 392 MNOs globally as of June 30, 2024. Total revenue was $22.4 million, representing an increase of 1.7% from U.S. $22 million in the second quarter of 2023. Revenue from service was $14.2 million, representing an increase of 0.5% from $14.1 million in the same period of 2023.
Speaker Change: As of June 32024, the company subs.
Speaker Change: To solve that 699, then it partner in 61 country in the region. The company had 182 patents. We why do you feel the street approved in 29 pending approval with a single call from.
Speaker Change: 392.
Speaker Change: As globally as of June 30, Tucson 24.
Speaker Change: Total revenue was 22.4 million, representing an increase of one 7% from U S. Dollar 22 million in the second quarter of 2023 revenue from surveys were $14 2 million representing an increase.
Speaker Change: 25% from 14 point of 1 million startup period.
Speaker Change: Serious Tucson 23.
Yimeng Shi: Revenue from service as a percentage of revenue was 63.4% during the second quarter of 2024, down from 64.1% during the same period last year. Geographically speaking, during the second quarter of 2024, Japan contributed 46.2% of our total revenue, North America contributed 14.6%, mainland China contributed 23.5%, and other countries in the region contributed the remaining 15.7%, compared to 43%. 29.5%, 11.6%, and 15.9%, respectively, in the same period of 2023.
Speaker Change: Revenue from services as a percentage of total revenue was 63, 4% during the second quarter 2024 down from 64, 1% during the same share last year.
Speaker Change: Geographically speaking during second quarter, two same thing for Japan can you get 46, 2% of our total revenue.
Speaker Change: America contributed 14, 6% mainland China contributed 23, 5% in all the countries in the region can you duty the remaining $15, 7% compared to 43%.
Speaker Change: 29.5% 11, 6% and 15, 9%, respectively in same period in Tucson and history.
Yimeng Shi: Overall gross profit was US$11 million compared to US$9.9 million in the same period of 2023. Overall gross margin was 49.2% in the sinking quarter of 2024, compared to 44.9% in the same period of 2023. Gross margin on service increased to 60.3% in the sinking quarter of 2024, from 58% in the same period of 2023. Gross margin on product increased to 30% in the sinking quarter of 2024, from 21.5% in the same period of 2023.
Speaker Change: Overall gross profit was 11 million U S dollar compared to nine 9 million you saw that in the same terrorists Tucson and history.
Speaker Change: Overall gross margin was 49, 2% in the second quarter, our Tucson, 24, compared to 44, 9% and same period, our Tucson 'twenty three.
Speaker Change: Gross margin also increased to 63% in the second quarter of two something useful from seven 8% and same periods in 2023 gross margin.
Speaker Change: Product increased to 30% second quarter, two sent any fall from 21, 5% in the same periods of Tucson to your story.
Yimeng Shi: Excluding share-based compensation, total operating expenses were $8.7 million, or 39% of total revenue, in the second quarter of 2024, compared to $7.3 million, or 33% of the total revenue in the same period in 2023. Net income was $2.2 million compared to a net cost of $0.9 million in the same period in 2003. [inaudible] $3.3 million in the second quarter of 2024 compared to $2.1 For the second quarter of 2024, we generated an operating cash inflow of $4.7 million, increasing by 38.3% from $3.4 million in the same period of 2023. For the second quarter of 2024, capital expenditure was $1.6 million compared to $0.5 million in the same period of 2023.
Speaker Change: Excluding share based compensation total operating expenses were $8 7 million or 39% of revenue.
Speaker Change: Second quarter 2023 can you fall.
Speaker Change: Compared to $7 3 million or 33% of the total revenue and same period between Tucson 'twenty three.
Speaker Change: Net income was $2 2 million compared to a net cost point.
Speaker Change: 9 million gets started up in the same period to something that's three adjust EBITDA was.
Speaker Change: 3.3 million you saw that in the stitching quarter of Tucson, 24, compared to $2 1 billion dollar for the same period to send 23 for the second quarter 2024, we generated operating cash inflow of $4 7 million start up increasing by 38, 3%.
Speaker Change: From $3 4 million startup and San Pierre Tucson to necessary for the second quarter of 2020 for capital expenditure were $1 6 million compared to $25 million you start out in the same period to something is true we maintained a solid balance sheet with cash and cash equivalents.
Speaker Change: Increasing to 26.8 million dollar.
Yimeng Shi: We maintained a solid balance sheet with cash and cash equivalents increasing to $26.8 million as of June 30, 2024, up from $24.7 million as of March 31, 2024. Now, with that operator, let's open it up for Q&A. Thank you. We will now begin the question and answer session. To ask a question, you may press Star, then 1 on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing.
Speaker Change: June 32024 up from $24 7 million you start up as of March 31st two critical with that operator, let's open it up for Q&A.
Speaker Change: Well now begin the question and answer session to ask a question you May Press Star then one on your Touchtone phone if youre using a speakerphone. Please pick up your handset before pressing the keys.
Speaker Change: If at any time a question has been addressed and you would like to withdraw your question. Please press Star then two.
Operator: If at any time a question has been addressed and you would like to withdraw your question, please press star then. The first question comes from Theodore O'Neill from Litchfield Hills Research. Please go ahead. Thank you and congratulations on the results for the quarter. My first question is about you. Cash, you're profitable, you increase cash in the quarter, and I was wondering if you have any thoughts about how to utilize the cash balance you're growing, other acquisitions, or dividends, or capital expenditures.
Speaker Change: The first question comes from Theodore O'neill from Litchfield Hills Research. Please go ahead.
Operator: Yeah, we have a strong cash inflow from operations, and the Sino-UK regional endorser, Evergrande, alliance, and the settings area. Thank you. Okay, my next question is about the GlocalMe Life solutions. You've highlighted the KeyTractor, RoamPlug, and Unicord here on the call.
Theodore O'Neill: Oh, Thank you and congratulations on the results for the quarter. My first question is about about uses uses for cash you're you're profitable you you increased cash in the quarter and I was wondering if you have some.
Speaker Change: Thoughts about how to utilize the cash balance, you're you're growing either acquisitions or dividends or or or capital expenditures of some kind.
Speaker Change: Yeah, we are we have a strong catch.
Speaker Change: Cash inflow from operations.
Speaker Change: Uh huh.
Speaker Change: It's got outsized at $44 $7 million generated in the sticking quarter.
Speaker Change: So on the overall cash equivalents.
Speaker Change: Now more than $26 million.
Speaker Change: He says he says Jones trained physicians indicate to us.
Speaker Change: And we are we.
Speaker Change: We still are well.
Speaker Change: Keep this <unk> to.
Speaker Change: To improve information in a in the near future say this year and the next yes.
Speaker Change: So far we don't have a specific target.
Speaker Change: For our positions we don't have.
Speaker Change: Have a full discussion on any dividends are planned.
Speaker Change: Planned so that's a so we focus on improve our.
Speaker Change: Gross and improve our financial position and we want to.
Speaker Change: Improve our fifth acquisition too.
Speaker Change:
Speaker Change: The company in a safer position us for long term operations.
Speaker Change: Yeah.
Unknown Executive: Are there additional products coming out in the GlocalMe Life solution? Yes, those are the first three products we launched for the global meet. We have continued to develop more products that will be coming in the following quarters. Okay, my last question is about the differences between Ucloudlink 1.0 and Ucloudlink 2.0.
Speaker Change: Okay. My next question is about the local me life solutions.
Speaker Change: You've highlighted.
Unicorn: Key tractor Rome plugging Unicorn here on the call are there additional products coming out into the local me life solutions.
Unicorn: Yeah.
Unicorn: Okay.
Speaker Change: And yes, we that's the forced us free toward that would with launch for cocoa meat. We continue a multiple that we had we have coming in the following quarters.
Unknown Executive: Can you talk about how the outlook for those two over the next, Water 2 [inaudible] Maybe add some columns first, and the CEO will add more comments on that. Yes, as we have disclosed our guidance for the third quarter, which is $24 million to $28 million in revenue. Yes, for this top-line growth, mainly driven by this international community service, especially as we disclosed in the second quarter, mainland China's growth, the out-of-bound traveler from mainland China to other countries grew significantly, and we think that trend will keep this same high and fast growth in the third quarter of this year. So for other loot, the main treason in the third quarter, many from international travelers growth for Chinese outbound and other regions outbound as well.
Speaker Change: Okay. My last question is about if you could talk about the outlook between your cloud link 1.0, and you can find a link to point out can you talk about how the outlook of those two are over the next quarter or two.
Speaker Change: Maybe.
Speaker Change: Some column first.
Speaker Change: And Oh, well I wont comment on that.
Speaker Change: Yes, as we disclose.
Speaker Change: To close our guidance for the third quarter, which is a <unk>.
Speaker Change: $24 million to to 10 8 million you start us for revenue.
Speaker Change: Yes, well, there's a couple of mine and many Germans are diverse international.
Speaker Change: Can it be service.
Speaker Change: Especially as I said, we we just close I missed thinking Qantas mainland China.
Carlos: Carlos I, the other bone traveler from mainland China to other countries.
Carlos: Gross.
Carlos: Politically Chile, and we are we think that that trend well, we have a kimpton as a same ah.
Speaker Change: Hi, fast high in the sauce gross and you know sticking in the third quarter I'm just yes. So.
Speaker Change: Look the main drilling.
Speaker Change: In the third quarter, many from international travelers, where else Paul for China for Chinese a bounce in all the regions are the boundaries as well and also we are we are.
Speaker Change: Expense.
New.
Speaker Change: New solutions like Gummy live series production as we launch in this so in the second quarters.
Speaker Change: Which were breeding where dreams are more revenue stream.
Speaker Change: Into our accounts.
Speaker Change: During the quarter in a more benign false call us so that we so we believe there's a gross fee that is.
Speaker Change: It's more than just in the National Real news our service, but also from our lives a serious serious as others.
Unknown Executive: So for our 1.0 business, you know, because we understand China, because we have two markets China and the Chinese market, they are still on the way of recovery. So I believe in the next year, from now on, they will still be on the way of recovery from the pandemic. So, by the time, all right.
Speaker Change: Yes.
Speaker Change: Chosen so.
Speaker Change: At 1.0 ER business.
We understand the China people have to market, China, and Japan market as the Oh No way all are recovering so I believe in the next year.
Speaker Change: No.
Speaker Change: A wave of a recovery from the pandemic. So pardon me the time, Okay and Oh. So it was a full a coupon to old business. Now we are develop most of hybrid ample connection for for fixed bump in take up this market also keep us.
Speaker Change: More than one patient for at least two risk market for 2.0, so we could see some opportunity in coupon or business fall high reliable connection that we can bring to their passengers.
Speaker Change: And therefore, our new proton AR because at the end of the second quarter with cash and newly launched in the stream product.
Speaker Change: And I think in the quarter, mainly in our quarter four we are bringing us.
Speaker Change: Generally in more revenue.
Speaker Change: New revenue for this new product of course bring.
Speaker Change: No the only data, but also as a subscriber unnecessarily unnecessarily.
<unk> revenue.
Speaker Change: Thank you very much that that answers my questions.
Speaker Change: Yeah.
Speaker Change: As a reminder, if you have a question. Please press star one. The next question comes from Vivian Zhang from Diamond Equity Research. Please go ahead.
Operator: As a reminder, if you have a question, please press star 1. The next question comes from Vivian Zeng from Diamond Equity Research; please go ahead. Good morning and evening, everyone.
Vivian Zhang: Good morning.
Vivian Zhang: Everyone. Thanks for taking my question and congrats on the strong culture of chips. So my first Mcclatchy, a little bit about the commercialization of glaucoma life. So how are the sales of the newly launched protect so far are there any other itself China besides selling directly on your face.
Speaker Change: Your web site.
Speaker Change: Hello.
Speaker Change: Yeah.
Unknown Executive: So yeah, so we both, and that's both from the online and offline channels. We were setting up all this wireless, this online and offline channel to sell our new product. Some are under our own brand, some are under our core brand with our partner.
Speaker Change: Yeah, Yeah, yeah. So yeah. So we are closed.
Speaker Change: From Oh, not an orphan on Oh, so it's four channel Oh. He was saying why are these are these online and offline channels to say, it's all our new product are we asami.
Speaker Change: Our old brain somewhere under all our pulp rang with all our partner so and so far I've seen the progress is very good. So it is.
Unknown Executive: So, and so far, I think the progress is very good. So, it's, it's, and our partner, they are, and also the feedback from the partner and the end user is quite positive because we bring a better connection in power to a better life. That's not only just tech revenue from the data connection. We are more revenue from the more revenue we have come from services such as the pad checking, I think in the future, also for convenience for the traveler.
Speaker Change: Our partner they are and also it's a fleet that's on the partner and the end user is quite positive because we bring.
Speaker Change: That definition empower empower that's a lot that's.
Speaker Change: And not only just tech revenue from a data connection.
Speaker Change: Where I'm more comfortable.
Speaker Change: Comfort on the onboard revenue where it comes on those so we see such as an iPad.
Unknown Executive: Also, I think of it as a unicorn, not only for travelers but also for daily use like a car, car power, and also a home IoT, you know, connection. We can bring home IoT connections, such as the Wi-Fi camera, to the outdoors, to the worldwide.
Jackie I think in the future also smaller convenient for the world traveller Oh, So it's a I think that kind of a unicorn not only a fault traveller Oh, it's always that's aiding us like a car now.
Speaker Change: Oh, so call Paula I'd also.
Speaker Change: Home Iot connections.
Speaker Change: We can bring the home Iot connections.
Speaker Change: The Wifi Timna total outdoor till the worldwide. So that's all quite unique our viewpoint. So they can that kind of didn't pre flight that can make all of our users a more easy and motor next most ft, and then more high quality a fallout Taiwan life.
Unknown Executive: So that's our quite unique value point. So that can simplify, that can make our users' lives easier and more relaxed, more safety, and more high quality for the travel life. Okay, I see. So my next question is that the guidance for the quota is quite strong. So any drivers behind that?
Speaker Change: Oh, Okay I see so my nephew classroom up is that the guidance for the culinary is quite strong so and drivers behind that thank.
Thank you.
Speaker Change: Yeah.
Unknown Executive: Thank you. Yeah, I think that I think for the next quarter, I think because our traditional product is closed, I think it's very stable. But I think the big jump of our revenue will come from our new product. Because we just newly launched the product, we need some time to bring back the revenue. So I think the feedback is very good. I would still have some uncertainty about the period of how quickly we can bring revenue back for this new product.
Speaker Change: Yeah.
Speaker Change: No I think.
Speaker Change: For this quarter I think.
Speaker Change: Because oh I lost the traditional pull down.
Speaker Change: Is close.
Speaker Change: It's very stable I think.
Speaker Change: The big jump off our revenue will come from our new products.
Speaker Change: So it.
Speaker Change: At closing, which has been the only launched the product so we need some time.
Speaker Change: <unk> two.
Speaker Change: Tweet AD revenue so I think that's.
Speaker Change: Definitely places where you could see.
Yes.
Speaker Change: Some uncertainties for the PRA, how quick we can bring the revenue back for this new product.
Speaker Change: Yeah.
Unknown Executive: Okay, so do you think this gray new launched lab products will affect your margin growth margin next quarter, or do you think you will keep current levels? I expect the service cost margins should be in a similar range as we delivered in this year, like the second quarter. Now, the main part of revenue came from the international roaming service, which is a higher cost margin service on our account. Subsequent feed related to the new Glow Me Live series product is, I believe, in other words, additional high cost margin solutions, and we will see how we deliver to the market in various regions and channels. We believe we will have good service margins this year and the future as well. Okay, that helps a lot. That's all my questions.
Speaker Change: Okay. So did things they like this great and you know they're not launched in that program they will affect your margin.
Speaker Change: Gross margin not next quarter or you think you will keep our.
Speaker Change: Current novel.
Speaker Change: Okay.
Speaker Change: Hi.
Speaker Change: I expect this.
Speaker Change: The service gross margins.
Sure sure be a in a similar range as well.
Speaker Change: We did invest in this year, not because they're thinking quarters.
Speaker Change: Now the man driven than men talk that revenue is that came from.
Speaker Change: National roaming service, which is a higher gross margin service accounts.
Speaker Change: Accounts.
Speaker Change: Like subsequent to see related to that and do you.
Speaker Change: Colombia lives a series product.
Speaker Change: It is a.
Speaker Change: I believe that the work is.
Speaker Change: Additionally, it was our highest gross margins are solutions, where we are.
Speaker Change: See how do we get them out to the market.
Speaker Change: Can you embarrass embarrassed that regions and channels. So we believe well have that well have it as a good.
Speaker Change: So we see margins in this yes in the future as well.
Speaker Change: Okay that helps a lot that's all my questions. Thank you.
Speaker Change: Okay.
Operator: Thank you. This concludes our question and answer session. I would like to turn the conference back over to Daniel Gao for closing remarks. Thank you once again for joining us today. If you have further questions, please feel free to contact Yorklink's Investor Relations through the contact information provided on our website or speak to our Investor Relations representative, Chris Tinson Advisory.
Speaker Change: This concludes our question and answer session I would like to turn the conference back over to Daniel Golf for closing remarks.
Daniel Gao: We look forward to speaking to you all again on our next quarterly call. Thank you. The conference is now concluded. Thank you for attending today's presentation. You may now disconnect. Thank you.
Daniel Golf: Okay. So I'm curious whether again for joining us today. If you have further questions. Please feel free to contact Investor relations through the contact information provided on our website or speak to our Investor relations phone christenson anniversary.
Speaker Change: We look forward to speaking to you all working on our last quarterly call. Thank you.
Speaker Change: The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
Operator: So thanks for taking my questions and congratulations on the strong quarter achieved. So my first question will be about the commercialization of glaucomi life. So how are the sales of the three newly launched products so far? Are there any other sales channels besides selling directly on your official website? So, Hello, team here. Yeah, yeah, yeah.
Unknown Executive: And also, we expect our new, new solutions like Gourmet Live Series products as we launch in the second quarters, which will bring more revenue into our account in the third quarter and more in the fourth quarters. So we believe that the growth driver is more than just an international raw means service but also from a live series service. Yes, I'm Jill Chen.
Unknown Executive: And also for the 2.0 business, now we have developed most of the high reliable connections for fixed broadband jack-up. This market also gives us more advantage for this 2.3 smart for 2.0. So we can see some opportunity in the 2.0 business for a high reliable connection. That's what we can bring to the past.
Unknown Executive: And for the new product, because at the end of the second quarter, we just launched the 3.0 product. And I think in the quarter three, and many in the quarter four, we are bringing in generally more revenue, bringing in new revenue for this new product. Of course, we know the only data, but also a subscriber and a service, another service, he's a revenue. Thank you very much, that's the bench mix.