KANZHUN LIMITED

Ladies and gentlemen, thank you for standing by and welcome to the Kanjin Limited Third Quarter 2021 Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a Q&A session. Today's conference is being recorded. At this time, I would like to turn the conference over to Ms. Wenbei Wang, Head of Investor Relations. Please go ahead, ma'am.

Thank you, Operator. Good evening and good morning, everyone. Welcome to our third quarter 2021 earnings conference call. Joining me today are our founder, chairman, and CEO, Mr. Jonathan Peng Zhao, and our director and CFO, Mr. Phil Yu Zhang. Before we start, we would like to remind you that today's discussion may contain forward-looking statements, which are based on management's 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 achievements of the company to be materially different. The company calls you not to place undue reliance on forward-looking statements and do not undertake any obligation to update this forward-looking information, except as required by law. During today's call, management will also discuss certain non-debt financial measures for comparison purposes only. For a definition of non-debt financial measures, and the reconciliation of debt to non-debt financial results, please see the earning release issued earlier today. In addition, a webcast replay of this conference call will be available on our website at ir.jp.com. With that, I will now turn the call to Jonathan, our founder, chairman, and CEO.

Hello, everyone. Welcome to Thank you for your trust and confidence. The third quarter is the first complete performance report after the company was launched. It is also a special report. Many people already know that since July 2021, I believe that 一直习惯于做大的企业未必都能够做强, 但是能够做强的企业必然更有机会做大。 几个月以来,工作上也有很多的成效。 Hello, everyone. Welcome to our third quarter 2021 earnings conference call. On behalf of our entire company,

I would like to express our sincere thanks to our users and investors for your trust and support. The third quarter is the first complete reporting period after our company went public, and it is also a special period. As many of you already know, new users' registration on the BossGP app has been suspended since July 6, 2021, in compliance with the cybersecurity. As a company which has grown rapidly since its its establishment, the suspension of new user registration has brought great challenges to our team. However, we have also taken this as an opportunity to focus on improving our service for existing users and reinforcing the development of our core competencies, and have made some substantial progress over these last months. I believe that an enterprise which aspires to grow big might not necessarily be able to become strong. but a company which can grow stronger definitely has a better chance to become bigger.

先说一下数字,我们在今年三季度依然努力取得了不错的业绩。 三季度我们的GAP收入为人民币12.1亿元, 实现了105%的同比增长。 扣除股权激励费用的经调整后净利润, Let's start with our key members. We managed to achieve decent results in the third quarter of this year. We recorded total revenue of RMB 1.21 billion in the quarter.

an increase of 105% year-on-year, and our adjusted net income, including share-based compensation expense, was RMB 385 million. In the third quarter, our average MAUs on the BossGP app reached 28.6 million, representing a year-on-year growth rate of 28.6%. 公司在整个三季度没有新用户的注册。

This has an impact on our business. However, from the perspective of many data, we believe that the effectiveness of our business model has not changed. One proof is that our monthly active user size is basically stable. The return rate of MAU has only decreased by a percentage. Another proof is that We can use the ratio of DAU to MU to see the activity of our users, and from the situation of the users' survival, there is no obvious change. The fundamental reason is that in the past seven years, we have built services based on mobile recommendation and treatment mode, and we have provided high-quality and valuable job-hunting services for our users, especially for those small and medium-sized enterprises

The suspension of new user registrations throughout the entire third quarter, which indeed had an impact on our business. However, we believe that the robustness and effectiveness of our business model remains unchanged, which was proven by many of our key performance indicators. Firstly, Our monthly active user numbers remain relatively stable, with MAUs decreasing in only these single digits quarter over quarter. Secondly, both user activity and engagement on our platform, which is represented by DAUs as a percentage of MAUs, and our user retention rate remain stable. We believe that the fundamental reason for this is the effectiveness of our service model. which was built and refined with mobile native recommendation and direct chat functionalities over the past seven years, and have truly delivered efficient and valuable job seeking and recruiting service to our users. Especially for those SMEs and long-tail job seekers, FoxGP is a more effective platform for them in many cases. 简单介绍一下在停止用户新增期间围绕做墙我们开展的一些工作。

One of the important things is that we have invested more resources to support the top consultants among the old users of the platform and to serve the senior employees together with them. The second thing is that we have focused on a large number of algorithm recommendation forces and industry research forces to continue to develop a general meeting project, which is to pursue the fairness of employee and recruiter resource allocation. I will briefly share with you the efforts we have taken to grow stronger during the suspension period for new user registration.

In early July, we immediately initiated a business optimization program, the call of which is to provide better service to commercial customers. We also launched an existing user protection plan where we focused on two things. The first was serving more senior job seekers who have greater work experience, a longer job seeking cycle, and a higher job switching cost. We devoted more resources to support headhunter advisors working together with them to better serve senior jobseekers. Second, we launched a project to help those relatively disadvantaged recruiters and jobseekers in the market with better opportunities. Leveraging powerful support from our recommendation algorithms and industry research teams, we are pursuing the fairness of the bilateral resource allocation among jobseekers and recruiters on our platform. College students and small and micro enterprise are user groups who benefit the most. All these endeavors not only improve our service capabilities, but also enhance our team's consensus and confidence to work together.

The income of the city service industry continues to increase in proportion. In the field of production and manufacturing, we actively explore the importance of the authenticity of comprehensive improvement of position, for some bad intermediaries, development governance, and optimization of the experience of the applicant. We have stronger confidence by continuously increasing the investment of technology and the investment of the power of the offline verification and integration team.

通过对于蓝领中介进行分级优选,可以为蓝领用户打造更加安全,可以信赖的求职平台。 Meanwhile, we have achieved progress in one of our core strategic development areas, which is blue-collar service. We continue to enlarge our advantages in the urban service sector, resulting in its revenue contribution continuing to increase. We also began to actively explore the manufacturing sector, focusing on making comprehensive improvements to job posting authentication and governance around illegal intermediaries, optimizing our blue-collar job seekers' user experience. We are increasingly confident that through our selected and classified management of blue-collar intermediaries and our continued investment in technology and offline verification team, We will create a safe and reliable job-seeking platform for blue-collar users.

We continue to invest heavily in our platform security infrastructure.

Our offline security verification and review teams have extended to cover 50 cities. Combined with our online review algorithms, we are able to verify the authenticity for more than 90% of our enterprise traffic. With our increasingly strong crackdown and restrictions of non-standard off-site recruitment situation, we have effectively reduced the user complaint rate. We firmly believe that protecting the safety and experience of job seekers is the lifeline of an online recruitment platform. Let me now talk about the ongoing progress of cybersecurity review. We are actively cooperating with the regulator and maintain ongoing communications. At the same time, we have strengthened our foundation on data security and privacy protection in accordance with the high standard of the industry. as well as a series of recent laws and regulations on data security and personal privacy protection. This work is extremely necessary for Internet platforms in any field. The building of this kind of core competence is also extremely necessary for an enterprise to resume responsibility for users, for society, for investors, and viewers' responsibility for an error. We can confidently say that during this period, The company has not only invested heavily in data security and privacy protection, but we have also greatly improved our capabilities in this area. I believe these abilities will create sustainable value for the company's long-term development.

The company is in the online security review stage, no new users. In such an unusual stage, the company has insisted on its mission, insisting on the power of technology, insisting on the responsibility of a public company, giving all its ability to create value for the growth of people and the prosperity of enterprises. I and the team sincerely believe that the internal training of this period is extremely necessary and meaningful. I clearly see that 我们商业模式和技术能力的有效性继续得到了验证。 我们的技术团队、安全团队和销售团队的人才招募和培养工作在稳步地增长。 对于未来,我们充满信心。 Dear users and investors, this quarter is the first complete reporting period after our listing. During this quarter, we have been under cybersecurity review

and were not able to grow our user base. Under such a special situation, as a public company, we have always been committed to leverage the power of technology to take the social responsibility and to make a valuable contribution for the development of individuals and the prosperity of enterprises we serve. I and Tim both sincerely believe that this kind of internal reinforcement is necessary and meaningful. I can see clearly that the effectiveness of our business model and technology capabilities continues to be validated. The recruitment and training of our technical team, security team, and sales team is still growing steadily, and we are full of confidence for the future.

我的部分就介绍到这里,接下来请我们公司CFO,CEO为大家介绍我们的财务情况,谢谢。

With that, I will turn to our CFO, Phil, for the review of our financials. Thank you.

Thanks, Jonathan. Hello, everyone. Thank you for joining our earnings call today. I would like to give a brief overview of our third quarter 2021 financial results, and then I will discuss our outlook for the next quarter. Before I begin, please note that all amounts are in RMB and all comparisons are on a year-on-year basis, unless otherwise stated. Our performance in the third quarter once again demonstrated our effective business model and improving leverage. Despite the suspension of new user registrations, our total revenues reached RMB $1.2 billion in the quarter, up 105% year-on-year, beating the high end of our guidance range. Our calculated cash billings increased by 62% to RMB 1.2 billion. With online recruitment services revenue accounting for more than 99% of our total revenues, we are pleased with the rapid growth of our paid enterprise customers, which reached a new record of 4.0 million in the 12 months ended September 30, 2021. Moving on to the cost side, total operating costs and expenses were RMB $903 million for the quarter, an increase of 62%, resulting in a positive operating income of RMB $311 million. Our cost of revenues increased by 125% to RMB 154 million in the quarter, with gross margin remaining robust at 87%. Sales and marketing expenses increased by 47% to RMB 416 million in the quarter, primarily due to our increased headcount and enhanced brand advertising activities. What is noteworthy is that our sales and marketing expenses represented 34% of our revenue in the quarter, down by 13.7%, a percentage point year on year, which was partly due to our continuing improvement in marketing efficiency, but it was also a result of reduced marketing expenses as we continued to be suspended from accepting new user registrations. Research and development expenses increased by 50% to RMB 209 million. General and administrative expenses increased by 84% to RMB 123 million, both primarily as a result of increased headcount and the share-based compensation expenses. Our headcount for R&D and sales continued to grow sequentially in the quarter. We are firmly committed to continuing to invest in technology and top talent to further enhance our core competencies. Our net income reached RMB $286 million in the third quarter compared to RMB $33 million in the same quarter last year, excluding share-based compensation Our adjusted net income was RMB 385 million in the third quarter, translating to an adjusted net margin of 31.8%, representing a 23-percentage point improvement. Our numbers in the third quarter can showcase the healthy and robust margin profile of our core online recruitment business that we believe our our business can achieve as our business matures in the future. Our net cash generated from operating activities was RMB 269 million this quarter, and as of September 30, 2021, we had cash and cash equivalents and short-term investments of RMB 11.9 billion. Our cash reserves gives us great confidence in our ability to execute our growth strategy, which we believe will yield considerable return in the long term. And now, for our business outlook, for the first quarter, the last quarter of 2021, we expect our total revenue to be between RMB 1.02 billion and RMB 1.05 billion. representing a year-on-year growth rate of approximately 58% to 62%. The cybersecurity review has had a real impact on our revenues, as revenues correlate directly to our users. The guidance for the next quarter is based on assumptions that the review will last at least until the end of December. As Jonathan just mentioned, our operating data shows that we still have our healthy user base and the healthy paying ratio, and that our paid customer retention and the ratio also remain stable. With the business and the monetization model still effective, we have faith that we can be back on our previous growth track as soon as we resume our new user registration in the future. That concludes our prepared remarks. Now we would like to answer questions. Operator, please go ahead with questions.

Thank you. As a reminder, to ask a question, you will need to press star 1 on your telephone and wait for your name to be announced. If you wish to cancel the request, please press the pound or hash key. Your first question comes from Eddie Wang from Morgan Stanley. Please ask your question.

Hey, Mr. Zhao, Yu Ge, Wenbei, good evening. Thank you for accepting my question. First of all, I would like to congratulate you on the very strong performance of 3G. Especially in the case that we cannot register new users, we can deliver such strong performance. I have two questions. The first question is about the impact of the entire Hongguan economy on the entire recruitment industry. Because of the three-season and four-season guidance, we feel that we can't register new users. But I feel that the red-collar economy is relatively weak. In fact, it did not react well to our income increase. I would like to ask President Zhao, from this point of view, have you seen any relatively weak macroeconomic impact on the entire recruitment industry and on us? Especially if you look at next year, if the entire economy has not yet had a very strong rebound, will this affect the entire entrepreneur's spending on recruitment? This is the first question. The second question may be a small one. As Yu-ge said, the guidance of the entire fourth quarter reflects the expectation that the registration of new users cannot be restored before the end of December. I don't know if there is any visibility on when the Internet security review can be completed and when we can re-register new users. I may simply translate it myself. Thank you for taking my question. I have two questions. Firstly, it's about the microeconomics flow down in China. Do you think there's any impact on the economy overall online recruitment segment and if there's any impact in our business in the fourth quarter and in 2022. And the second question is about, do you have any visibility of when the cybersecurity investigation will be completed and when we are likely to resume our new user registration timeline? Thank you.

Okay, thank you for your question. I will answer your second question first. When will the online security check be stopped? Or when can the relevant users be restored? The company has not yet clearly specified a timetable. At the same time, we can do what I just said in my statement. One is to actively cooperate and maintain communication. I will first answer your second question.

about when the cybersecurity review will finish or we can resume our user registration. The company doesn't have a clear timeline as of today. But as I have just mentioned, there are two things we can do. The first one is we actively cooperate with the regulators to maintain proactive communication in hope of this review can end as soon as possible. The second is that we are Under the supervision of the regulators, we are actively to enhance our data security and personal privacy protection according to the recent issued laws and regulations.

There are a few more points to comment on. First, China is an economic society made up of countless small and medium-sized enterprises. We know that China has tens of millions of companies that employ hundreds of millions of people. On average, one company employs more than ten people. So these small and medium-sized enterprises have one characteristic, which is that they are affected by a macroeconomic situation. If we put five bowling balls in a net, and then hit them with an eight-pound hammer, then the vibration will be very big. Maybe these balls will break or get hurt. But if we put 1,000 ping-pong balls in the net in the same size, we still hit them with an eight-pound hammer.

Okay. To answer your first question, the macroeconomy would definitely have an impact on the recruiting business. The theory is valid. But I have several myself opinions. The first one is that China is a society which has lots of small and micro enterprises. There are tens of millions of companies. and hundreds of millions of people, which one company normally hires no more than tens of people. And for small and micro enterprises, what they characterize is that the macro impact on the company is relatively small. They are quite strong. I have been working in this industry for 16 years, and I have seen the financial crisis in 2008, and the market has cooled down. I need to use an example to demonstrate my theory that if we put together five bowling balls and we use an eight-pound hammer to beat it, the balls will damage it altogether. But we put together 1,000 ping-pong balls and we use the same eight-pound hammer to beat them. The top two ping-pong balls might break, but the rest will be safe. And that's the difference between... which is compromised with big and key customers, and the economy is compromised with small and micro enterprises. So when the micro economy goes down, the latter will survive.

他会呈现出一定程度甚至于相当程度的滞后。 那么如果市场能够恢复的话, 他这种下行就不会是V字型的,而是比较平缓的。 这是我的一个观察,也是一个经验吧。 And for the market we are in, I have two more opinions. The first one is if the economy continues to go down,

an industry which is a small and micro enterprise take up the majority, there is a certain level of delay. So when the market can recover, the going down will be relatively smooth.

It is suitable for small and medium-sized enterprises to recruit people. In fact, the average salary of a recruiter per month is not high. It is a very good service. So, I still think that there will be more people who will even reduce their budget And my second opinion is that combined with the industry and overcoming ourselves, because we are offering a service which can suit the small and micro enterprises much better.

An average recruiter spending on our platform is quite limited. For one month, it's no more than several hundred RMB. So we have the best value for money. Even in the current situation, when the macroeconomy goes down, when people want to cut down their recruiting budget, as a platform with better value for money, we can still attract a lot of users to pay for our service. And that's my opinion for this question.

非常感谢赵总,宇哥,文贝。谢谢。 Your next question comes from Wei Zhang of UBS. Please ask your question.

My first question is about competition. Since the network security review has lasted for almost two seasons, I would like to ask if we have noticed any changes in the competition pattern of the online recruitment industry during this period? Since the new users have been restricted during this period, I would also like to ask what work the company has done during this period to maintain our long-term competitive advantage. The second question is about the trend of user growth next year. Because now everyone understands that the timeline of this network security review is still uncertain. So if our new user registration can be restored early next year, what is our goal of user growth next year? And then the company will be ready to adopt what kind of customer strategy to achieve this goal. Thank you, management, for taking my questions. First, I want to ask about the competition side. Given that your ability to grow new users remains impacted in the past few months, have we seen any changes in the competitive landscape in the online recruitment market? And in the meantime, what are the areas that management has been focused on in order to maintain your competitive advantages in the longer term? And second, just on the user growth outlook for next year, if we assume that the new user growth can be resumed early next year, what would be your user growth target for the next year? And associated with that, what is your user acquisition strategy and the impact on the margin and the selling and marketing expenses next year? Thank you.

Thank you for your question. I would like to answer your first question, the first part of your first question. Then Jonathan can add more about what we have done with the competition. So regarding for the competitive landscape, we think that from third parties' data, you can see that basically in past quarter or a couple of months, there was no big change. So our service are still ahead of peers with largest monthly active users and the daily active users. So our gap with the peers is still large enough. And so you can check with some third party market research tracking data to find the facts. And in terms of the user engagement level, like time span, like daily app using frequency, we are still highest among peers. So basically, the company is still in very healthy situation, even we have been suspended with new user registration during the past quarter. And thirdly, regarding for our user retention, our own data shows that our users were not affected by the cybersecurity review. The user retention ratio keeps very stable and healthy. So all of those shows that we are still very healthy and robust in a very good situation.

Okay, let me answer your previous question. During the online inspection and new users, we did a lot of work. I talked about it in my presentation. I will explain it a little bit. Actually, I want to give an example. We provide this app service, launch this service. In the past four months and nine days, there has been a high-speed growth stage. If I have 100 yuan, I may put 60 yuan on growth and 40 yuan on other infrastructure. At this stage, I have three months and one quarter without growth. Then I put 100 yuan on infrastructure. After writing this example, let's talk about what infrastructure I have. and think about how to provide better services for them to form better MCS. Specifically, for example, we have done a focus on serving the already existing head consultants on the platform. We asked them to go together with the platform to better serve the senior recruiters. This is a part of the loss. The second part of the loss is that the recruiters and recruiters who were relatively competitive in the recruit recruitment market The second type of person, I can't say that he has a very big economic value today, but there is no doubt that those who are in the competitive market in the employment recruitment market are also a platform like us.

Okay. For your second part of question, during the cybersecurity review, what we have done, I will put down into details for you. For example, since we have provided our service, it has been seven years, four months, nine days. And during all that time, we have been growth verified. For example, if I have $100, I will put $60 on the growth and $40 on our infrastructure growth. And since we cannot grow our users for the entire quarter, so I put $100 in the infrastructure. So what is infrastructure? I have two parts for you. The first one is we continue to improve our data security and personal privacy protection. We are proving and investing heavily in technology, in experts, in our overall system and capabilities. for several months. We have some achievements, and these do have long-term value for our company. And second part is on the user end. Who will be the easiest to lose from our platform? We identified two kinds of users. The first one is for those who have a longer job-seeking period. So when they cannot find a job, they will go. And they might have a longer working period and a higher salary. work switch cost and might have a higher income, so those senior jobseekers. As I just said, we have put a lot of effort and resources to work together with those headhunters to provide better service for those senior jobseekers and to improve their NPS. The second kind of user group is those jobseekers and recruiters who are relatively disadvantaged in the market. And under our circumstances, when we are growing very fast, we are not focused on our efforts on those people. But currently, we can focus all our resources and all our efforts and our team has a better consensus to provide our service for those people. This is the project and we do have some substantial progress on that part. The funny thing is that all those two kinds of people do have some value. For the senior job seekers, if we can provide better service for them, if they have a better ecosystem on our platform, so they can attract more enterprises who have a need for that kind of senior job seekers. And the second group of users, they might not have a great economic value at this moment. They are relatively disadvantaged. But we believe that as a public company, we should show them more social responsibilities for them so they have more social value. So we believe all of our endeavors during this period should have both economic and social values for ourselves and for the society. And that's my answer for your question.

So regarding your second question, the user growth target for next year. This question is hard to answer at this moment because we are not clear when we will be allowed to grow our users. We can only do it during our normal operation. I think the time is not today, but What I can say is that from the discussions above, you can understand that our business model is still valid and very effective. And during the whole third quarter, we still served the largest groups of job seekers and employers. And the users maintained a very healthy engagement level on our platform. So they like our platform. And since the beginning of 2020, cybersecurity review process, during the past four months, there were failed registration records from 17 million users. So, 17 million users as we recorded. So, that was a huge number. So, a lot of users, they want to register on our platform, but they cannot do it during the past couple of months So the only thing that we can say at this moment is that once we were allowed to grow our users, we will do it. We will regain our lost users at full speed.

Thank you, management.

Your next question comes from Colin Liu of China Renaissance. Please ask your question.

Hello, everyone. Thank you for this opportunity. I have two questions today. The first question is about self-employed people, including our cooperation with some leaders. I would like to ask, at this level, which is also the market we usually talk about, is our income model different from other businesses? Can you explain this? My second question is about So I have two questions for our management. The first one is regarding the potential opportunities from senior job seekers and which we normally call gold-collar workers. I just want to ask if there's any difference in terms of revenue model from this segment compared with other positive business. The other question is about, well, if the cybersecurity review continue to rose out to the first quarter next year, which will make the company to meet some very critical time window, such as Chinese New Year and the Beijing Winter Olympics, which will further impact the new user acquisition. I just want to check if the management has any other measures you plan to counter such negative impacts. Thank you, Mr. Wang.

Thank you for your question. Regarding the golden bell service, thank you for your definition. You are concerned about our industry. What kind of income model will this golden bell service have? This question is very coincidental because our team is focusing on these senior 求職者的过程中有同样的问题 那我也会很诚实的告诉你我们产业内部对这个事的共识 当前我们集中精力在如何更好的服务他们 如何更好的服务猎头顾问 如何更好的服务发布 经理职位的招聘者的角度 我们先首先想把这个生态系统进一步的优化 然后在此基础上 我们尚未明确拿出一个说 How to make money from this matter? This sentence can be understood from two perspectives. One perspective is that in fact, the person who recruited the manager in the past is also here to buy our standardized product. So this is a sentence that can continue to happen. So in addition, is there any chance that we have some additional income models? For this, we do not have a new model to take out today. But we still have an old belief, which is that if we can make a user service model, just like a very new consumer model such as Bounce Food, then we will also have a chance to find our new revenue model through value and get a price. So I made such an answer. The second question is actually more difficult to answer. Because in fact, we don't know when this will stop. Okay, suppose as you said, suppose as you said, the situation is that after the Spring Festival, it is still not possible to register new users. Then you mentioned the Winter Olympics. I understand it as an opportunity for event sales. That is, everyone will go to this opportunity to attract new users. After the Spring Festival, you mentioned that it is actually a shopping season for the Chinese shopping market. 我们可以恢复新用户的增加 我也不觉得我们要进行 某种报复式的市场投放 我们就还是一如既往的按规律 相信我们的模式 做好的用户服务 该做什么做什么 所以大概我心里今天的打算是这样的 多谢你的问题 Thank you for your question And regarding the gold color You do have a very sound understanding of our industry

So we do refer to our senior job seekers as blue collars. And in terms of what kind of revenue model, very coincidentally, our team do have the same question, which is how we can charge those kind of service. But we do have consensus internally. The first one is currently we are focusing on how to provide better service for those senior job seekers, for the headhunters, for the enterprises who will post those senior job openings to optimize our ecosystem. The second one is that we don't have a clear revenue model as of now, but in the past and still ongoing is that all those enterprises who are recruiting senior job seekers, they purchase the same standard products we provide currently, and this is continuing to happen. And for the additional revenue model, we don't have a clear clue right now, but we have a belief that if we can provide a good service to our users like what we have done for the past seven years, we will create price through our value to fund the new revenue model. And your second question, which is even harder to answer regarding when we will resume user registration, If we cannot resume the new user registration after the Chinese New Year Festival, and regarding the Winter Olympics, which we can, regarding it as a marketing event opportunity, normally the Spring Festival, after Spring Festival is the peak season for recruiting. If we cannot acquire new users by then, we currently are not thinking of any new ways to acquire new users. It's a review was not finished by them. But what we will continue to do is that I have to think of that clearly. What we will continue to do is that we will continue to improve our infrastructure. And one day, if the user registration resumes, I am thinking we will not invest in the marketing in a very aggressive way. We just do it properly and to our service as normal, and that's my plan for now.

An answer to your question.

As due to time constraints, that concludes today's question and answer session. At this time, I will turn the conference back to Wenbei for any additional or closing remarks.

Thank you, Operator. And thank you once again for joining us today. If you have any further questions, please contact our IR team directly or our TPD Investor Relations. Thank you.

Thank you. Ladies and gentlemen, that does conclude our conference for today. Thank you for participating. You may now all disconnect.