Q2 2026 Xunlei Ltd Earnings Call

August 13, 2026

Speaker #1: Welcome, ladies and gentlemen, and thank you for your patience. You've joined Lu Xing's second quarter 2026 earnings conference call. At this time, all participants are to listen only mode.

Operator: Welcome, ladies and gentlemen, and thank you for your patience. You have joined Xunlei's second quarter 2026 earnings conference call. At this time, all participants are in a listen-only mode. Please be advised that today's conference is being recorded. I would now like to turn the call over to your host, Investor Relations Manager, Ms. Luhan Tang.

Operator: Welcome, ladies and gentlemen, and thank you for your patience. You have joined Xunlei's Q2 2026 earnings conference call. At this time, all participants are in a listen-only mode. Please be advised that today's conference is being recorded. I would now like to turn the call over to your host, Investor Relations Manager, Ms. Luhan Tang.

Speaker #1: Please be advised that today's conference is being recorded. I would now like to turn the call over to your host, Investor Relations Manager, Ms. Luhan Tang.

Luhan Tang: Good morning and good evening, everyone, and thank you for joining Xunlei's Q2 2026 earnings conference call. With me today are Eric Zhou, CFO, and Li Li, Vice President of Finance. Our IR website has our earnings press release to supplement our prepared remarks during the call. Today's agenda includes a prepared opening remark from Chairman and CEO, Mr. Jim Wu Li, on Q2 operational highlights, followed by CFO Eric Zhou's presentation of financial results details of Q2 before we open up the floor to your questions in the Q&A session. Please note that this call is recorded and can be replayed on our investor relations website at ir.xunlei.com. Before we get started, I would like to take this opportunity to remind you that the discussion today will contain certain forward-looking statements made under the Safe Harbor Provisions of the U.S. Private Securities Litigation Reform Act of 1995.

Speaker #2: Good morning and good evening, everyone. And thank you for joining Xunlei's Q2 2026 earnings conference call. With me today are Eric Zhou, CFO, and Lili, Vice President of Finance.

Speaker #2: Our IR website has our earnings press release to supplement our prepared remarks during the call. Today's agenda includes a prepared opening remark from Chairman and CEO Mr. Jin Guoli on Q2 operational highlights, followed by CFO Eric Zhou's presentation of financial results details of Q2 before we open up the floor to your questions in the Q&A session.

Speaker #2: Please note that this call is recorded and can be replayed on our Investor Relations website at ir.xunlei.com. Before we get started, I'd like to take this opportunity to remind you that the discussion today will contain certain forward-looking statements, made under the Safe Harbor Provisions of the U.S.

Speaker #2: Private Securities Litigation Reformed Act of 1995. Such statements are based on our management's current expectations under existing market conditions that are subject to risks and uncertainties that are difficult to predict, which may cause actual results to differ materially from those made in the forward-looking statements.

Luhan Tang: Such statements are based on our management's current expectations under existing market conditions that are subject to risks and uncertainties that are difficult to predict, which may cause actual results to differ materially from those made in the forward-looking statements. Please refer to our SEC filings for more detailed description of the risk factors that may affect our results. Xunlei assumes no obligations to update any forward-looking statements except as required under applicable law. On this call, we will be using both GAAP and non-GAAP financial measures. A reconciliation of non-GAAP and comparable GAAP measures can be found in our earnings press release. Please note that all numbers are in USD unless otherwise stated. Now, the following is prepared statements by Mr. Jim Wu Li, Chairman and CEO of Xunlei Limited. Good morning and good evening, everyone. Thank you for joining our Q2 2026 earnings call.

Speaker #2: Please refer to our SBC filings for more detailed description of the risk factors that may affect our results. Xunlei assumes no obligations to update any forward-looking statements except as required under applicable law.

Speaker #2: On this call, we'll be using both GAAP and non-GAAP financial measures for reconciliation of non-GAAP comparable GAAP measures can be found in our earnings press release.

Speaker #2: Please note that all numbers are in U.S. dollars unless otherwise stated. Now, the following is the prepared statement by Mr. Jin Guoli, Chairman and CEO of Xunlei Limited.

Speaker #2: Good morning and good evening, everyone. Thank you for joining our Q2 2026 earnings call. We're pleased to report continued top-line growth this quarter. Building on a solid consumer-focused growth foundation we established in Q1.

Luhan Tang: We are pleased to report continued top-line growth this quarter building on a solid consumer-focused growth foundations we established in Q1. These results serve as clear validation that our strategic pivot towards a consumer-centric business model is delivering tangible results. Our two primary growth drivers, subscription services and overseas audio live streaming, each posted steady year-over-year increase in revenue. Let me walk you through the performance of these core consumer-facing businesses individually. First, our subscription business remains our stable cash flow foundation and reliable growth anchor. Q2 subscription revenue reached $44.5 million, up 22.6% year-over-year. While the growth rate softened marginally on the sequential basis, this segment maintained resilient user retention and steady monetization performance. During the quarter, we continued upgrading premium user experiences by rolling out new AI-powered features, optimizing existing functionality, deepening long-term cooperation with leading domestic smartphone partners, and scaling our ecosystem user acquisition channels as planned.

Speaker #2: These results serve as clear validation that our strategic pivot toward a consumer-centric business model is delivering tangible results. Our two primary growth drivers, subscription services and overseas audio live streaming, each posted steady year-over-year increase in revenue.

Speaker #2: Let me walk you through the performance of these core consumer-facing businesses individually. First, our subscription business remains our stable cash flow foundation and reliable growth anchor.

Speaker #2: Q2 subscription revenue reached $44.5 million up 22.6% year-over-year, while the growth rate softened marginally on the sequential basis. This segment maintained resilient user retention and steady monetization performance.

Speaker #2: During the quarter, we continued upgrading premium user experiences by rolling out new AI-powered features. Optimizing existing functionality deepening long-term cooperation with leading domestic smartphone partners, and scaling our ecosystem user acquisition channels as planned.

Speaker #2: Looking ahead, we will continue refining our differentiated member perks to boost user penetration and expand end-device cooperation coverage, capturing incremental user acquisition and revenue growth in the second half of the year.

Luhan Tang: Looking ahead, we will continue refining our differentiated member perks to boost user penetration and expand end-to-device cooperation coverage, capturing incremental user acquisition and revenue growth in the H2 of the year. Second, our overseas audio live streaming business once again emerged as our primary growth engine. In Q2, this segment generated $58.2 million in revenue, representing a significant 64.8% year-over-year increase. We continued deploying targeted investments in high-potential emerging markets, including Southeast Asia, the Middle East, Turkey, and further expansion into Latin America. Concurrently, we enhanced localized product iteration and operational capabilities, optimizing our product matrix across one-on-one social interaction scenarios and multi-person chat rooms. Additionally, we saw notable quarterly momentum for our Hupu business, which contributed $9.1 million in Q2 of revenue, benefiting from the peak advertising season and a slate of major global sporting events. User discussion activity across the platform reached new highs.

Speaker #2: Second, our overseas audio live streaming business once again emerged as our primary growth engine. In Q2, this segment generated $58.2 million in revenue, representing a significant 54.8% year-over-year increase.

Speaker #2: We continued deploying targeted investments in high-potential emerging markets, including Southeast Asia, the Middle East, Turkey, and further expansion into Latin America. Concurrently, we enhanced localized product iteration and operational capabilities, optimizing our product matrix across one-on-one social interaction scenarios and multi-person chat rooms.

Speaker #2: Additionally, we saw notable quarterly momentum for our whole pool business, which contributed $9.1 million in Q2 revenue, benefiting from the peak advertising season and a slate of major global sporting events.

Speaker #2: User discussion activity across the platform reached new highs. Our newly rolled-out AI-powered features also meaningfully boosted user engagement and deepened interactive activity, creating an additional stream of incremental revenue across our consumer ecosystem.

Luhan Tang: Our newly rolled out AI-powered features also meaningfully boosted user engagement and deepened interactive activity, creating an additional stream of incremental revenue across our consumer ecosystem. As we communicated in our previous quarterly reports, competition in the overseas entertainment market remains intense. Accordingly, we will stick to our long-term localized operational and marketing strategies instead of chasing near-term scale expansion, fostering sustainable business growth across all our core consumer verticals. Beyond operational performance, to further reinforce market confidence and deliver long-term shareholder returns, we announced a new $20 million share repurchase program at end of June. We believe that this initiative demonstrates our unwavering confidence in the company's solid fundamentals and long-term growth potential. We will maintain disciplined capital allocation, prioritizing investment in core consumer product innovation and international market expansion, while returning excess capital to shareholders when appropriate.

Speaker #2: As we communicated in our previous quarterly reports, competition in the overseas entertainment market remains intense. Accordingly, we will stick to our long-term localized operational and marketing strategies instead of chasing near-term scale expansion.

Speaker #2: Fostering sustainable business growth across all our core consumer verticals. Beyond operational performance, to further reinforce market confidence and deliver long-term shareholder returns, we announced a new 20-million share repurchase program at the end of June.

Speaker #2: We believe that this initiative demonstrates our unwavering confidence in the company's solid fundamentals and long-term growth potential. We will maintain disciplined capital allocation prioritizing investment in core consumer product innovation in the international market expansion while alternating access capital to shareholders when appropriate.

Speaker #2: Looking ahead, we will stay firmly committed to our user-centric development strategy. We will further accelerate feature iteration for our subscription offerings, deepen market penetration within our established overseas markets, selectively pursue new regional growth opportunities, and uphold strict cost discipline to expand profit margins across all baselines.

Luhan Tang: Looking ahead, we will stay firmly committed to our user-centric development strategy. We will further accelerate feature iteration for our subscription offerings, deepen market penetration within our established overseas markets, selectively pursue new regional growth opportunities, and uphold strict cost discipline to expand profit margins across all business lines. By balancing growth with profitability and through rigorous capital and operational management, we aim to promote balanced and sustainable corporate development. Against the backdrop of an evolving global market landscape, our targeted consumer positioning, two core business structure, advanced technological strength, and localized operations serve as our key competitive edges. We are optimistic about delivering sustained long-term value to our users and shareholders alike. With that overview, I will now turn the call over to our CFO, Eric Zhou, who will walk you through our Q2 financial metrics in detail.

Speaker #2: By balancing growth with profitability, and through rigorous capital and operational management, we aim to promote balanced and sustainable corporate development. Against the backdrop of an evolving global market landscape, our targeted consumer positioning, fueled core business structures, advanced technological strengths, and localized operations serve as our key competitive edges.

Speaker #2: We're optimistic about delivering sustained, long-term value to our users and shareholders alike. With that overview, I will now turn the call over to our CFO, Eric Zhou, who will walk you through our Q2 financial metrics in detail.

Speaker #3: Thank you, Wuhan. Thank you all for participating in today's conference call. As we now walk you through our financial results for the second quarter of 2026.

Naijiang Zhou: Thank you, Wu Han. Thank you all for participating in today's conference call. I will now walk you through our financial results for the Q2 of 2026. For Q2 2026, total revenues came in at $102.7 million, up 38.9% year-over-year. This steady top-line growth was primarily driven by rising revenues from our subscription business and our overseas audio live streaming business, as well as improved Hupu's advertising business. Breaking down our revenue performance. Subscription revenues reached $44.5 million, a 22.6% year-over-year increase. This performance reflects sustained user demand for a full suite of premium product offerings. Revenue from live streaming and other services totaled $58.2 million, representing a 54.8% year-over-year increase. This strong performance was driven chiefly by rapid expansion of our overseas audio live streaming operations, alongside the growth in advertising revenue from our Hupu sports community during the peak sports season.

Eric Zhou: Thank you, Wu Han. Thank you all for participating in today's conference call. I will now walk you through our financial results for the Q2 of 2026. For Q2 2026, total revenues came in at $102.7 million, up 38.9% year-over-year. This steady top-line growth was primarily driven by rising revenues from our subscription business and our overseas audio live streaming business, as well as improved Hupu's advertising business. Breaking down our revenue performance. Subscription revenues reached $44.5 million, a 22.6% year-over-year increase. This performance reflects sustained user demand for a full suite of premium product offerings. Revenue from live streaming and other services totaled $58.2 million, representing a 54.8% year-over-year increase. This strong performance was driven chiefly by rapid expansion of our overseas audio live streaming operations, alongside the growth in advertising revenue from our Hupu sports community during the peak sports season.

Speaker #3: For Q2 2026, total revenue is coming in at $102.7 million, up 38.9% year over year. This steady top-line growth was primarily driven by rising revenues from our subscription business and our overseas audio live streaming business, as well as improved Whole-Force advertising business.

Speaker #3: Breaking down our revenue performance, subscription revenues reached $44.5 million, a 22.6% year-over-year increase. This performance reflected sustained user demand for our full suite of premium product offerings.

Speaker #3: Revenue from live streaming and other services totaled $58.2 million, representing a 54.8% year-over-year increase. This strong performance was driven heavily by rapid expansion of our overseas audio live streaming operations, alongside the growth in advertising revenue from our whole-force sports community during the peak sports season.

Naijiang Zhou: Cost of revenues was $44.8 million during the quarter, accounting for 43.6% of total revenues. By comparison, in Q2 2025, cost of revenues came to $27 million, or 36.6% of total revenues. The uptick in our cost base largely aligned with the expansion of our live streaming revenues, driven mainly by increased revenue sharing expenses for our overseas audio live streaming operations. Turning to profitability, we generated $57.3 million in gross profits during the second quarter of 2026, up 23.1% year-over-year. Gross margin stood at 55.8%, compared with 63% in the prior year period. The gross profit improvement was fueled by both our subscription business and the Hupu advertising revenue. The notable margin decline stems from a structural revenue mix shift. Since live streaming carries a lower gross margin than subscription and advertising business, its larger share of total revenue mix modestly compressed our overall gross margin.

Eric Zhou: Cost of revenues was $44.8 million during the quarter, accounting for 43.6% of total revenues. By comparison, in Q2 2025, cost of revenues came to $27 million, or 36.6% of total revenues. The uptick in our cost base largely aligned with the expansion of our live streaming revenues, driven mainly by increased revenue sharing expenses for our overseas audio live streaming operations. Turning to profitability, we generated $57.3 million in gross profits during the Q2 of 2026, up 23.1% year-over-year. Gross margin stood at 55.8%, compared with 63% in the prior year period. The gross profit improvement was fueled by both our subscription business and the Hupu advertising revenue. The notable margin decline stems from a structural revenue mix shift. Since live streaming carries a lower gross margin than subscription and advertising business, its larger share of total revenue mix modestly compressed our overall gross margin.

Speaker #3: Cost of revenues was $44.8 million during the quarter, accounting for 43.6% of total revenues. By comparison, in Q2 2025, cost of revenues came to $27 million, or 36.6% of total revenues.

Speaker #3: The uptick in our cost base largely aligned with expansion of our live streaming revenue driven mainly by increased revenue sharing expansions for our overseas audio live streaming operations.

Speaker #3: Turning to profitability, we generated $57.3 million in gross profit during the second quarter of 2026, up 23.1% year over year. Gross margin stood at 55.8%, compared with 63% in the prior-year period.

Speaker #3: The gross profit improvement was fueled by both our subscription business and the overall advertising revenue. The notable margin decline stemmed from a structural revenue mix shift, since live streaming carries a lower gross margin than the subscription and advertising businesses.

Speaker #3: Its larger share of the total revenue mix marginally compressed our overall gross margin. On the expense front, R&D expenses were $21.4 million in Q2 2026, representing 20.8% of total revenues.

Naijiang Zhou: On the expense front, R&D expenses were $21.4 million in Q2 2026, representing 20.8% of total revenues, compared with $16.6 million or 22.4% of total revenues in Q2 2025. The year-over-year increase was mainly due to higher labor costs. Sales and marketing expenses rose to $27.9 million during the second quarter of 2026, representing 27.2% of revenue, compared with $20.7 million or 28% of total revenues in Q2 2025. The increase in absolute marketing spending reflected ramped-up promotional investments across our subscription and overseas audio live streaming operations, as we continued to proactively prioritize acquisition and brand visibility. G&A expenses came in at $12.7 million, equal to 12.4% of total revenues, versus $8.5 million or 11.6% of total revenues in Q2 2025. The increase was primarily driven by provisions for ongoing legal litigations and higher employee-related costs year-over-year.

Eric Zhou: On the expense front, R&D expenses were $21.4 million in Q2 2026, representing 20.8% of total revenues, compared with $16.6 million or 22.4% of total revenues in Q2 2025. The year-over-year increase was mainly due to higher labor costs. Sales and marketing expenses rose to $27.9 million during the Q2 of 2026, representing 27.2% of revenue, compared with $20.7 million or 28% of total revenues in Q2 2025. The increase in absolute marketing spending reflected ramped-up promotional investments across our subscription and overseas audio live streaming operations, as we continued to proactively prioritize acquisition and brand visibility. G&A expenses came in at $12.7 million, equal to 12.4% of total revenues, versus $8.5 million or 11.6% of total revenues in Q2 2025. The increase was primarily driven by provisions for ongoing legal litigations and higher employee-related costs year-over-year.

Speaker #3: Compared with $16.6 million, or 32.4% of total revenues, in Q2 2025. The year-over-year increase was mainly due to higher labor costs. Sales and marketing expenses rose to $27.9 million during the second quarter of 2026, representing 27.2% of revenue, compared with $13.7 million, or 28% of total revenues, in Q2 2025.

Speaker #3: The increase in absolute marketing spending reflected ramped-up promotional investment across our subscription and overseas audio live streaming operations, as we continued to proactively prioritize acquisition and brand visibility.

Speaker #3: G&A expenses came in at $12.7 million, equal to 12.4% of total revenues, versus $8.5 million, or 11.6% of total revenues, in Q2 2025. The increase was primarily driven by provisions for ongoing legal litigations and higher employee-related costs year over year.

Speaker #3: At the operating level, we posted an operating loss of $4.8 million, this quarter, a reversal from operating income of $0.3 million in the same period last year.

Naijiang Zhou: At the operating level, we posted an operating loss of $4.8 million this quarter, a reversal from operating income of $0.3 million in the same period last year. This swing was largely due to the sequential and year-over-year rise in our selling, marketing, and general administrative expenses outlined above. We posted a net other loss of $230.8 million for the quarter, versus net income of $771.5 million in Q2 2025. The dramatic swing was mainly driven by fair value volatility on our long-term investment in Arashi Vision Inc., which is accounted for on a mark-to-market basis using public stock prices after the company's IPO in June 2025. Unlike Q1, there were no discontinued operations to report for Q2 2026, following the disposal of our Shenzhen Wanxin business last quarter. Our net loss from continuing operations was $218.5 million this quarter, compared with net income of $726.4 million in Q2 2025.

Eric Zhou: At the operating level, we posted an operating loss of $4.8 million this quarter, a reversal from operating income of $0.3 million in the same period last year. This swing was largely due to the sequential and year-over-year rise in our selling, marketing, and general administrative expenses outlined above. We posted a net other loss of $230.8 million for the quarter, versus net income of $771.5 million in Q2 2025. The dramatic swing was mainly driven by fair value volatility on our long-term investment in Arashi Vision Inc., which is accounted for on a mark-to-market basis using public stock prices after the company's IPO in June 2025. Unlike Q1, there were no discontinued operations to report for Q2 2026, following the disposal of our Shenzhen Wanxin business last quarter. Our net loss from continuing operations was $218.5 million this quarter, compared with net income of $726.4 million in Q2 2025.

Speaker #3: This swing was largely due to the sequential and year-over-year rise in our serving marketing and general administrative expenses outlined above. We posted a net other loss of $213.8 million, for the quarter, versus net income of $721.5 million in Q2 2025.

Speaker #3: The geometric swing was mainly driven by sale value volatility on our long-term investment in a Russia-vision ink, which is accounted for on mark-to-market basis using public stock prices after the company's IPO in June 2025.

Speaker #3: Unlike Q1, there were no discontinued operations to report for Q2 2026. Following the disposal of our Shenzhen Wanxing business last quarter, our net loss from continuing operations was $218.5 million this quarter, compared with net income of $726.4 million in Q2 2025.

Speaker #3: The net loss was mainly due to the material net other loss just mentioned, partially offset by positive gross profit growth in our core consumer-facing business.

Naijiang Zhou: The net loss was mainly due to the material net other loss just mentioned, partially offset by positive growth in our core consumer-facing business. On a non-GAAP basis, we posted a non-GAAP net loss from continuing operations of $2.1 million, down from non-GAAP net income of $7.2 million in the prior year period. On a per-share basis, diluted loss per ADS from continuing operations was $3.43 for the quarter, compared with diluted EPS of $11.47 in Q2 2025. Our non-GAAP diluted loss per ADS from continuing operations came to $0.03, versus non-GAAP diluted earnings of $0.12 per ADS in the same period last year. Finally, on our balance sheet, as of 30 June 2026, cash equivalents, and short-term investments totaled $276.9 million, down from $303.6 million as of 31 March 2026.

Eric Zhou: The net loss was mainly due to the material net other loss just mentioned, partially offset by positive growth in our core consumer-facing business. On a non-GAAP basis, we posted a non-GAAP net loss from continuing operations of $2.1 million, down from non-GAAP net income of $7.2 million in the prior year period. On a per-share basis, diluted loss per ADS from continuing operations was $3.43 for the quarter, compared with diluted EPS of $11.47 in Q2 2025. Our non-GAAP diluted loss per ADS from continuing operations came to $0.03, versus non-GAAP diluted earnings of $0.12 per ADS in the same period last year. Finally, on our balance sheet, as of 30 June 2026, cash equivalents, and short-term investments totaled $276.9 million, down from $303.6 million as of 31 March 2026.

Speaker #3: On a non-GAAP basis, we posted a non-GAAP net loss from continuing operations of $2.1 million, down from non-GAAP net income of $7.2 million in the prior year period.

Speaker #3: On a per-share basis, diluted loss per ADS from continuing operations was $3.43 for the quarter, compared with diluted EPS of $11.47 in Q2 2025.

Speaker #3: Our non-GAAP diluted loss per ADS from continuing operations came to $0.03, versus non-GAAP diluted earnings of $0.12 per ADS in the same period last year.

Speaker #3: Finally, on our balance sheet, as of June 30, 2026, cash, cash equivalents, and short-term investments totaled $276.9 million down from $303.6 million as of March 31, 2026.

Naijiang Zhou: The sequential decrease was primarily driven by net operating cash outflows, bank loan repayments, disbursements related to our newly announced share repurchase program, and a deferred consideration payment related to our Hupu acquisition. This concludes our prepared remarks. Operator, we are now ready to open the line for questions.

Eric Zhou: The sequential decrease was primarily driven by net operating cash outflows, bank loan repayments, disbursements related to our newly announced share repurchase program, and a deferred consideration payment related to our Hupu acquisition. This concludes our prepared remarks. Operator, we are now ready to open the line for questions.

Speaker #3: The sequential decrease was primarily driven by net operating cash outflows, bank loan repayments, disbursements related to our newly announced share repurchase program, and deferred consideration payments related to our Whole-Force acquisition.

Speaker #3: This concludes our prepared remarks. Operator, we are now ready to open the line for questions.

Speaker #1: Thank you very much. We will now conduct Xunlei's question and answer session. To ask a question, please press star 11 on your telephone and wait for your name to be announced.

Operator: Thank you very much. We will now conduct Xunlei's question and answer session. To ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please give a moment. Just a moment for our first question, please. First question comes from the lines of Zoe Zhang, retail investor. Please go ahead. Zoe Zhang, please go ahead.

Speaker #1: To withdraw your question, please press star 11 again. Please give us a moment. Just a moment for our first question, please. Our first question comes from Alliance's Zoe Zhang, a retail investor.

Speaker #1: Please go ahead. Zoe Zhang, please go ahead.

Speaker #2: Hello. 管理层好，我想问一下你们6月底宣布了股票回购的计划，但是这次的财报中没有任何的披露，所以想请问一下你们有在回购吗？然后大概是什么情况呢？

Zoe Zhang: 管理层好，我想问一下，你们6月底宣布了股票回购的计划，但是这次的财报中没有任何的披露，所以想请问一下你们有在回购吗？大概是什么情况呢？

Speaker #3: The question is, the company announced a share repurchase program, and at the end of June, but she didn't see any share repurchase information in our press release, and she's not to know what's going on with the buy-back program.

Naijiang Zhou: The question is, the company announced a share repurchase program at the end of June, but she didn't see any share repurchase information in our press release, and she'd like to know what's going on with the buyback program. Thanks for asking. The board of directors of company approved a new share repurchase program of $20 million at the end of June, and the repurchase officially commenced on 1 July. As of 12 August, we bought back approximately 1.07 million shares of ADS and spent approximately $5.9 million. The repurchase program remains ongoing, and more details will be disclosed in our Q3 financial report. Thank you.

Eric Zhou: The question is, the company announced a share repurchase program at the end of June, but she didn't see any share repurchase information in our press release, and she'd like to know what's going on with the buyback program. Thanks for asking. The board of directors of company approved a new share repurchase program of $20 million at the end of June, and the repurchase officially commenced on 1 July. As of 12 August, we bought back approximately 1.07 million shares of ADS and spent approximately $5.9 million. The repurchase program remains ongoing, and more details will be disclosed in our Q3 financial report. Thank you.

Speaker #3: Thanks for asking. The board of directors of the company approved a new share repurchase program of $20 million at the end of June, and the repurchase officially commenced on July 1.

Speaker #3: And as of August 12, we bought back approximately 1.07 million shares of ADS and spent approximately $5.9 million. The repurchase program remains ongoing, and more details will be disclosed in our third-quarter financial report.

Speaker #3: Thank you.

Speaker #2: 我想翻译一下。我们公司是在6月底的时候经董事会审批通过了这个2000万美元的新一轮的股票回购计划。那这次的回购是从7月1号正式启动的。那截止于昨天8月12号的话，我们已经回购了大概107万股的ADS，总共花费了大概590万美元左右。然后我们会把更多的一些披露情况在第三季度的财报中进行披露。谢谢您的问题。好的，谢谢。

Li Li: 我先翻译一下。我们公司是在6月底的时候，经董事会审批，通过了这个2,000万美元的新一轮的股票回购计划。这次的回购是从7月1号正式启动的。截止于昨天8月12号的话，我们已经回购了大概107万股的ADS，总共花费了大概590万美元左右。然后我们会把更多的一些披露情况在第三季度的财报中进行披露。谢谢您的问题。

Zoe Zhang: 好的，谢谢。

Speaker #1: Thank you. Just a moment for our next question. As a reminder, to ask a question, please press *11 on your telephone keypad. Next, we have XJ, Individual Shareholder.

Operator: Thank you. Just a moment for our next question. As a reminder, to ask a question, please press star 11 on your telephone keypad. Next we have XJ, individual shareholder.

Speaker #4: 管理层你们好。我想问一下就是影石创新已经在6月份决定了，那么在上一个季度的业绩会里面，公司说会在解禁的前后对于这部分的一个股票后续怎么去处理做出一个公告，还有提升股东的一个回报。那我想问一下公司接下来这一部分的计划是怎么样的？因为另外一个方面，根据美国的上市条例，如果公司在这一部分应该是超过了把公司需要转成已经投资公司的这样的一个门槛，那这一部分公司是怎么样打算的？谢谢。

[Company Representative]: 管理层你们好，我想问一下，影石创新已经在6月份解禁了，那么在上一个季度的业绩会里面，公司说会在解禁的前后，对于这部分的一个股票后续怎么去处理，做出一个公告，还有提升股东的一个回报。那我想问一下公司接下来这一部分的计划是怎么样的？因为另外一个方面，根据美国的上市条例，如果公司在这一部分应该是超过了公司需要转成投资公司的这样的一个门槛，那这一部分公司是怎么样打算的？谢谢。

[Shareholder] (Private Investor): 管理层你们好，我想问一下，影石创新已经在6月份解禁了，那么在上一个季度的业绩会里面，公司说会在解禁的前后，对于这部分的一个股票后续怎么去处理，做出一个公告，还有提升股东的一个回报。那我想问一下公司接下来这一部分的计划是怎么样的？因为另外一个方面，根据美国的上市条例，如果公司在这一部分应该是超过了公司需要转成投资公司的这样的一个门槛，那这一部分公司是怎么样打算的？谢谢。

Speaker #3: Okay. Basically, his question is surrounding our stakeholder in 影石股份 or AirAsia Vision Inc. And he's not to know our progress in reducing our stake in this investment.

Naijiang Zhou: Okay, basically his question is surrounding our stakehold in Arashi Vision Inc. He would like to know our progress in reducing our stake in this investment and what our plans for the proceeds for the future. Thank you for the question. Currently, we hold more than 5% of shareholders for exactly 7.8% of interest in such equity stake. We need to follow certain regulatory rules and regulations when we begin to sell the stock and do it in an ordinary manner and make timely disclosure. For the time being, we are going through certain procedures to get ready to reduce our stake in the company. But at this time, we have no specific plans for the share disposal for the time being. He also asked a question regarding the Investment Company Act of 1940.

Eric Zhou: Okay, basically his question is surrounding our stakehold in Arashi Vision Inc. He would like to know our progress in reducing our stake in this investment and what our plans for the proceeds for the future. Thank you for the question. Currently, we hold more than 5% of shareholders for exactly 7.8% of interest in such equity stake. We need to follow certain regulatory rules and regulations when we begin to sell the stock and do it in an ordinary manner and make timely disclosure. For the time being, we are going through certain procedures to get ready to reduce our stake in the company. But at this time, we have no specific plans for the share disposal for the time being. He also asked a question regarding the Investment Company Act of 1940.

Speaker #3: And what our plans for the proceeds for the future. And thank you for the question. And currently, we hold more than 5% of shareholders or exactly 7.8% of 影石 equity stake and we need to follow certain regulatory rules and regulations when we begin to sell the stock.

Speaker #3: And do it in an ordinary manner and make timely disclosure. For the time being, we are following certain procedures to get ready to reduce our stake in the company.

Speaker #3: But at this time, we have no specific plans for the share disposal for the time being. And he also asked the question regarding the 1940 investment company act.

Speaker #3: And according to that 1940 investment act, a listed company needs to follow certain regulations to be in compliance with the requirements of the investment act.

Naijiang Zhou: According to that, in the Investment Company Act of 1940, a listed company needs to follow certain regulations to be in compliance with the requirements of the Investment Company Act. We will continue to monitor our holdings of our appreciated assets. We have been consulting with relevant advisors. If needed, we will gradually seek to adjust our holdings so that Xunlei holds investment securities with a value not exceeding 45% of the company's total assets, excluding government securities and cash items. This is in line with the company's intention to mainly engage in the core business, which is consumer-facing business, To C business. We never intend to be an investment company. Thank you.

Eric Zhou: According to that, in the Investment Company Act of 1940, a listed company needs to follow certain regulations to be in compliance with the requirements of the Investment Company Act. We will continue to monitor our holdings of our appreciated assets. We have been consulting with relevant advisors. If needed, we will gradually seek to adjust our holdings so that Xunlei holds investment securities with a value not exceeding 45% of the company's total assets, excluding government securities and cash items. This is in line with the company's intention to mainly engage in the core business, which is consumer-facing business, To C business. We never intend to be an investment company. Thank you.

Speaker #3: We will continue to monitor our holdings of appreciated assets, and we have been consulting with relevant advisors. If needed, we will gradually seek to adjust our holdings so that Xunlei holds investment securities with a value not exceeding 45% of the company's total assets.

Speaker #3: Excluding government securities and cash items, in line with the company's intention to mainly engage in the core business, which is consumer-facing business, or 2C business, we never intend to be an investment company.

Speaker #3: Thank you.

Speaker #2: 我们翻译一下。这是目前的话，迅雷持有影石超过5%的股份，所以我们是需要根据一些监管的规定，有序的减持和披露。那么目前的话，我们也在这个过程当中进行准备。然后我们目前暂没有明确的相关的这个减持的计划，但您在准备过程中了。然后您谈到的1940法案，我们会持续对持有的增值的这个资产进行监控，也和我们相关的中介机构监管机构进行协商。若需要的话，我们也会逐步对持有的这部分资产进行减持和调整。然后确保公司持有的这个投资资产价值不超过公司总资产的45%。这也是公司专注于核心2C业务的这个发展目标，相符的这个目标。然后我们也从未打算成为一家投资公司。然后谢谢您的问题。

Li Li: 我翻译一下。目前的话，迅雷持有超过5%的股份，所以我们是需要根据一些监管的规定，有序的减持和披露。目前的话，我们也在这个过程当中进行准备。我们目前还没有明确的相关的减持的计划，但已经在准备过程中了。您谈到的1940法案，我们会持续对持有的增值的资产进行监控，也和我们相关的中介机构、监管机构进行协商。若需要的话，我们也会逐步对持有的这部分资产进行减持和调整，确保公司持有的投资资产价值不超过公司总资产45%。这也是公司专注于核心To C业务的发展目标相符的目标。我们也从未打算成为一家投资公司。谢谢您的问题。

Speaker #1: Thank you. I see no further questions at this time. I will now turn the conference back to Eric for closing remarks.

Operator: Thank you. I see no further questions at this time. I will now turn the conference back to Eric for closing remarks.

Speaker #3: Thank you again for your time and participation. For any follow-up inquiries, please visit our website at irxunlei.xunlei.com or contact our investor relations team. Have a good day.

Naijiang Zhou: Thank you for your time and participation. For any follow-up inquiries, please visit our website at ir.xunlei.com or contact our investor relations team. Have a good day. Okay, we conclude this conference call. Thank you.

Eric Zhou: Thank you for your time and participation. For any follow-up inquiries, please visit our website at ir.xunlei.com or contact our investor relations team. Have a good day. Okay, we conclude this conference call. Thank you.

Speaker #3: Operator will conclude today's conference call. Thank you.

Operator: Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.