KANZHUN LIMITED

Ladies and gentlemen, thank you for standing by and welcome to Kanchen Limited fourth quarter and fiscal year 2024 financial results conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. Today's conference is being recorded. At this time, I'd 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 first quarter and full year 2024 earnings conference call. Joining me today are our founder, chairman, and the CEO, Mr. Jonathan Peng Zhao, and our director and CFO, Mr. Phil 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 caution 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-GAAP financial measures for comparison purpose only. For a definition of non-GAAP financial measures and the reconciliation of GAAP to non-GAAP financial results, please see the earnings release issued earlier today. In addition, a webcast replay of this conference call will be available on our website at ir.gping.com. We said, I will now turn the call to Jonathan, our founder, chairman, and CEO.

大家好,欢迎参加我们公司2024年四季度和全业业绩发布会。 我代表公司全体员工,管理层和董事会,感谢一直相信我们,支持我们的用户,投资人和朋友们。

Hello everyone, thank you for joining our company's fourth quarter and full-year 2024 earnings conference call. On behalf of the company's employees, management team, and board of directors, I would like to extend our sincere gratitude to our users and investors and friends who have continuously believed in us and supported us.

Let me first introduce the performance of our company. The fourth quarter, the company achieved a GAF income of 180.2 billion, which is 15% higher than before. After deducting the equity incentive fee, the adjusted net profit was 7.2 billion, which is 15% higher than before. In the fourth quarter, the BOSS-certified APT end averaged a perfect MAU of 52.7 million, which is 28% higher than before.

Let me first provide an overview of our financial performance. In the fourth quarter, the company achieved a gap revenue of RMB 1.82 billion, up 15% year-on-year. Our adjusted net income, which includes share-based compensation expenses, reached RMB 720 million, reflecting a 15% year-on-year growth. In the fourth quarter, Average verified monthly active users, or MAU, on the BossJapan app increased by 28% year-on-year to 52.7 million.

In 2024, the company's annual income was 73.6 billion yuan, which is a 24% increase. After deducting the equity base cost, the net profit of the year-on-year adjustment was 27.1 billion yuan, which is a 26% increase.

不考虑理财收益等其他收益。 24年经调整后,营业利润为23.2亿, 同比增长41%。 2024年,公司完成了在利润上的承诺。 For the full year of 2024, the company achieved a gap revenue of RMB 7.36 billion, up 24% year-on-year, adjusting net income, which includes share-based compensation expenses, reached RMB 2.71 billion, up 26% year-on-year. Furthermore, our adjusted operating income, including other income such as wealth management income, was RMB 2.32 billion for full year 2024, rising by 41% year-on-year. And in 2024, we successfully delivered on our profit commitments.

Share-based compensation expenses as a percentage of revenue in 2024 decreased by 2.3 percentage points compared to 2023.

and I expect it to further decline in both absolute value and proportion of revenue in 2025.

2024年年度新增完善用户将近4950万人是年度新增用户规模的新高。与此同时,市场费用同比2023年下降,得益于用户对公司品牌的认可。 In 2024, we attracted nearly 49.5 million newly added verified users, setting a new record for any user growth.

At the same time, We reduced marketing expenses compared to 2023 thanks to our growing brand recognition and enhanced electric network effects, which have significantly improved customer acquisition efficiency. As of December 31, 2024, the company has provided service to over 225 million users and 16.6 million enterprises.

In the first year of 2024, the average number of users for BOSS-Zipin APP was 53 million, which increased by 25.3%. We have provided over 1.8 billion users with the opportunity to exchange ideas based on the requests from both parties, which is the achievement of our operating approach.

MAU on the bus checking app for the full year reached 53 million, representing a year-on-year increase of 25.3%. In the year, we facilitated over 1.85 billion successful resume exchanges based on mutual consent between job seekers and employers, which is what we refer to as achievement in daily operations.

Despite macroeconomy challenges in 2024, the company's user growth-driven revenue growth model remains effective.

driving notable improvement in both revenue scale and profitability. Some may argue that we are more beta-driven business.

However, I would like to emphasize that our business model is so much more than that.

To date, user expansion has remained our core growth driver.

用户持续的渗透带来的收入结构性的增长体现在如下。 第一,蓝领在收入中的贡献持续提升。 蓝领用户增长带动全年蓝领收入贡献进一步提升至38%。 2024年,制造业是蓝领增长的亮点,也是所有行业中增长最快的。

The structural revenue growth driven by sustained user penetration is clearly reflected in the following key metrics. First, increasing revenue contribution from blue collar segments. Blue collar's user growth boosted their revenue contribution to overall revenue in 2024 to 38%. Notably, the manufacturing sector emerged as a bright spot for blue collar growth, posting the fastest growth rate among all industries. Second, the revenue contribution from non-tier one cities continues to grow.

Third, the revenue contribution from micro and small enterprises continue to rise.

Micro and small enterprises are defined as business with fewer than 20 employees.

这些都是用户增长的结构性变化带来的收入增长。 前提是公司围绕提升用户体验在产品跟服务上的进步支持了这些变化。 那么不难知道,在线招聘服务行业中,蓝领尤其是制造业蓝领, These revenue gains stem from structural shifts in user growth.

At the core of this success is the company's commitment to enhancing the user experience, which is underpinned by our continuous product and service optimization. It's not hard to imagine that within the online recruitment service industry, blue collar workers, particularly those in the manufacturing sector, lower tier cities and micro small enterprises are among the more challenging user groups to serve. Breakthroughs and growth in these areas would only validate our user-first strategy, but also highlight the significant potential for our future user expansion and revenue growth.

另外我们也观察到白领跟大企业招聘的需求奇闻。 一万人以上的超大型企业在四季度的收入环比是增速最快的。

Additionally, we have observed that recruitment demand from white-collar and large enterprises has stabilized. Enterprises with over 10,000 employees demonstrated the fastest quarter-on-quarter revenue growth in the fourth quarter.

In terms of product and service, there is one thing worth mentioning. Many investors and friends have been concerned about the company's exploration in the recruitment and payment business. We have made some progress. In 2024, I want to highlight one more aspect of our products and services.

Many investors in France have shown interest in the company's exploration of closed-loop services initiatives, which we do have some progress. In 2024, the number of enterprises which we have provided placement-alike service was near 40,000.

In 2024, the total number of paid enterprise customers reached 6.1 million, representing a year-on-year increase of 17.3%.

While the active user-paying ratio remains stable, the average revenue per paying user, or ARPU, achieved year-on-year growth both for the full year and in the fourth quarter.

Let me introduce the use of AI for the 13030 version of the App. The 13030 version is around the 7th of this month.

Now let me introduce some AI implementation. We faced rollout in version 13.030 of the Boss Chipping app, which was released across major app stores around March 7th.

先讲一下我们这边的AI2C, 也就是2求职者测的一些更新。 一个在求职者职位搜索的交互上, I'll start with our AI2C or AI for job seekers site updates.

First, On JobSeeker's interaction for job search, we have added an AI-powered question-based search function, something many of you are likely already familiar with, and also kept our traditional keyword search. The search engine is powered by both our proprietary model called Nanbei Ge and the deployment of DeepSeek R1.

In AI2C, the second thing is that we deployed a robot. And the second thing on the job seeker side is we have released an AI bot to help job seekers with interview coaching.

This feature primarily targets those who have graduated within the past three years. This AI bot has been trained on millions of real interviews, and his core skills is that he's very good at interviewing. And as such, there are lots of things he can do. We will go step by step.

Now let's talk about AI2B. The first application is an agent. The recruiters that have been tested by us can communicate with this agent. This agent will do the following things. First, understand the recruiters' demands. Second, find them in our talent library and give them the recruiters that are suitable for each other. Third, each candidate will give a reason for his recommendation. Now let's take a look at AI2 business, which is the recruiter side.

Our first application for enterprise users is an AI agent. Recruiters participating in the beta testing can communicate their needs to the agent, which can perform the following tasks. Understand the recruiter's specific requirements. 2. Generate a curated list of candidates from our database. 3. Offer justification for its recommendations. 4.

Deliver these results according to the recruiter's available schedule. 第二个应用,我们主要是绘度给了一些蓝领招聘者。 场景是这样的。

The recruiter chooses the person he thinks is suitable, and clearly expresses his willingness to try it out with the person. Then the next exchange is carried out by AI. Until the AI on behalf of the recruiter obtains the approval of the applicant, for example, the way of exchanging messages, or the AI on behalf of the recruiter is rejected by the applicant, then the process is over.

For the second application, a better version has been launched to a selected group of blue collar enterprise users. The process unfolds as follows. Once a recruiter selects a candidate, they deem suitable and explicitly express their willingness to proceed by saying, I'm willing to give this candidate a try. The AI handles all subsequent communication on behalf of the recruiter. The communication process continues until the AI either obtains the job seeker's confirmation of interest through the exchange of contact information, or the job seeker rejects the outreach of the recruiter who is represented by AI.

In terms of operation, AI has a great potential to improve management efficiency and reduce costs. For example, using AI to assist in security review can currently improve On the operational front, AI has huge potential to improve management efficiency and reduce cost.

For instance, Leveraged AI for security review has improved our audit efficiency by 30%. Over the past two years, as our user base has expanded rapidly, the workload related to user security protection has increased accordingly. However, AI has enabled us to manage this without a proportional increase in staffing.

Next, I would like to briefly update you on the situation of this year's spring recruitment. After this year's Spring Festival, the recruitment market has continued a steady recovery trend since the end of 2024. In February of this year, the number of active users, the number of active positions, especially the number of new positions and other data, are all a new height in history. Please pay attention. The number of new positions and other data are all a new height in history. Next, I will briefly update you on this year's spring recruitment season.

Following the spring festival, the recruitment market continued a steady recovery trend that began towards end of 2024. Post-Chinese New Year in February, the company's key metrics, including number of active users, active job postings, and new job postings, all reached historical highs. The average daily new job postings after Chinese New Year increased by more than 10% compared to the same period last year. Peak daily active users on the Boss Japan app reached approximately 20 million, which are also historical highs.

A very important highlight on the supply and demand side.

The job seeker-to-enterprise user ratio among new users improved compared to the same period last year, extending the positive momentum that began in November 2024.

从行业的类型上来看,制造业,物流,汽车,医疗,教育,专业服务等表现较好。 从职位类型来看,蓝领岗位由用户增长,带动的增速更快。

From an industry perspective, manufacturing, logistics, automotive, healthcare, education, and professional services have exhibited strong performance. In terms of job type, blue-collar positions have grown faster due to our user expansion, while white-collar roles have also demonstrated an improving year-on-year trend.

After the Spring Festival, among the new positions of the Japanese military, AI-related positions have increased by more than 60%. We feel that an entrepreneurial ecosystem has been activated. Inspired by the growth of AI-related positions, the positions of many products and technologies around us have also shown a positive trend after the end of the COVID-19 pandemic.

Notably, since the Spring Festival, average daily posting of AI-related jobs have surged by over 60% year-on-year, signaling a revitalized ecosystem for emerging business. This growth in AI-related roles, in turn, has fueled good sequential momentum in demand for product and technical positions since the Spring Festival.

Last but not least,

We are very committed to shareholder returns. In 2024, the company repurchased approximately 229 million worth of shares, accounting for 3.7% of total outstanding shares. This underscores our confidence in the company's long-term growth. And that concludes my part of the call. I will now turn it over to our CFO Phil for the review of our financials. Thank you.

Thanks, Jonathan. Hello, everyone. Now let me walk through the details of our financial results of fourth quarter and full year of 2024. We delivered a solid financial results for the fourth quarter and the full year of 2024. The recruitment market environment in 2024 was challenging, but we are pleased to see that recruitment demand gradually stabilized towards the end of the year. Under such conditions, our revenues grew by 15% year-on-year to RMB 1.8 billion during this quarter, slightly beating our expectation and grew by 24% to RMB 7.4 billion for the full year. Our number of paid enterprise customers for 2024 expanded to 6.1 million, marking a 17% year-on-year growth. Our pool for the quarter was up by 6.8% year-on-year and 3.9% quarter-on-quarter, marking a full consecutive quarterly growth. Our pool for the full year reached RMB 1.2 thousand, up by more than 5% year-on-year. It's a result of our efforts to explore customer needs and providing more valuable services. Moving to the cost and expenses side, our total operating cost and expenses increased by 7% year-on-year to RMB 1.5 billion during the fourth quarter and by 15% to RMB 6.2 billion for the full year. Total share-based compensation expenses decreased by 6% year-on-year in the quarter. As percentage of revenue-wise, share-based compensation went down by 4 and 2 percentage points respectively for the quarter and the full year. Excluding share-based compensation expenses, our adjusted income from operation grew by 27% to RMB 659 billion and 41% to RMB 2.3 billion respectively for the quarter and the full year. The adjusted operating margin for the fourth quarter reached a quarterly historical high of 36.1%. While the annual adjusted operating margins improved by 4 percentage points to 31.5% in 2024, continue to demonstrate our strong operating leverage and beating our target. Cost of revenues increased by 14% year-on-year to RMB $314 million. during the fourth quarter and by 17% to RMB 1.2 billion for the full year. This increase was primarily due to increases in payment processing costs, server and bandwidth costs, and other business related costs, alongside with the growth of revenue and user base. It's worth mentioning that Operational employee related costs as percentage of revenue decreased by 0.9 percentage point year on year. An evidence of AI application to improve operating efficiency. As a result, our gross margin went up by 0.9% to 83.1% in 2024. Sales and marketing expenses decreased by 2% year-on-year to RMB 426 million during this quarter and increased by 4% to RMB 2.1 billion for the full year. Our marketing expenses, including Olympic campaign sponsorship, decreased by 10% year-on-year, despite a higher new user growth versus prior year. We believe this improving trend of user acquisition efficiencies will continue in 2025 and led to a further decrease of our marketing expenses on both absolute amount and as percentage of revenue r d expenses increased by two percent year on year to r b 440 million this quarter and by 18 to r b 1.8 billion for the full year this increase was primarily driven by our further investment in AI infrastructure, which incurred AI-related server depreciation costs and cloud services fees. DNA expenses increased by 23% year-on-year to RMB 276 million during this quarter, and by 35% to RMB 1.1 billion for the full year. This increase was mainly due to increased employee relief expenses and investment in new business initiatives. Our net income reached RMB $444 million in the quarter and $1.6 billion in 2024. Our adjusted net income increased by 15% year-on-year to RMB $722 million in the fourth quarter. and the 26% year-on-year to RMB $2.7 billion for the full year. The adjusted net margin continued to expand in the full year and reached a historical high of 36.9%. Net cash provided by operating activities amounted to RMB $956 million during the fourth quarter. and increased by 16% year-on-year to RMB $3.5 billion for the full year. And our cash position stood at RMB $14.7 billion as of December 31, 2024, though there was share buyback spending. The robust cash reserves coupled with strong operating cash flows strategically positioned us well to support future growth initiatives and shareholder returns. During this quarter, we repurchased 6.7 million ADS for a total consideration of US dollar 93 million. This led to a 1.1 decrease in our total outstanding shares as compared to September 30, 2024, even after counting in shares issued for our share based awards. Combined with share repurchase in the preceding quarters, We have spent a total of US$229 billion for the share repurchases in 2024, representing substantial progress of our share repurchase programs. And now for our business outlook for the first quarter of 2025, as we witnessed the recruitment spending bottoming out from last quarter. and showing upswing trajectory post-Chinese New Year. We expect our total revenues to be between RMB 1.9 billion and RMB 1.92 billion, a year-on-year increase of 11.5% to 12.7%. With that, that concludes our prepared remarks. Now, we would like to answer questions. Operator, please go ahead.

Thank you. We will now begin the question and answer session. To ask a question, please press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. We will now take our first question from the line of Eddie Wong from Morgan Stanley. Please ask your question, Eddie.

Good morning, Mr. Yu. Thank you for accepting my question. Congratulations on the strong guidance of EGDU. I would like to ask two questions. First, can you please elaborate on how you think DeepSeq will affect the online recruitment industry? including the change in industry technology products and the demand for the entire market recruitment. As Mr. Zhao mentioned, the recruitment of the technology industry has been a hot topic recently. What is the impact of the entire demand and what are the advantages of our BOSS recruitment? The second question is, as we know, we have also invested heavily in AI. Now that DeepSeq is about to take off, will there be any changes in our development and investment strategy in AI? What is the company's future plan for AI products? I will translate it myself. Thank you, management, for taking my question. I have two questions. The first one is, could you please share your thoughts on how the AI boom driven by DeepSeq might impact the online recruitment industry? And this includes the transformations in the industry technology and the products, as well as its influence on the market recruitment demands. For example, the hiring search in the tech industry. What are our competitive advantage in this context? The second question is, we actually have made quite big or significant investment already So with the emergency of deep-seek, will this promote any adjustments to our AI and the investment strategy? And what is our future roadmap for AI product development? Thank you.

Thank you for your question. Let me answer it. First of all, the deep-seek phenomenon . . .

. Thank you for your question.

Let me first talk about the implication of the deep seek have on the online recruitment industry. First in the, especially for the demand side, In short term, we do see some changes. For example, on the recruiter side, as I just mentioned, the average daily newly added AI-related jobs surged by more than 64%, which is quite rare. And also, the existing jobs became more active. So the average daily online active number of AI-related jobs increased by more than 24%, which is also quite a big number.

From the point of view of the job seekers, from the point of view of C, it is obvious that everyone is inspired by this hot trend.

More job seekers want to find their future opportunities in the field of AI. The number of job seekers who take the initiative to search for the position of the key word of AI has increased by 34%.

On the jobseeker side, of course, everyone was trying to looking for opportunities in this AI trend. So on the numbers, we find that the active search results, active search keywords with AI increased by more than 34% year-on-year.

These changes in the future of the recruitment industry, I think,

will definitely have a profound impact. Let me start with a positive and a negative impact. A positive impact is that AI's ability to understand human language and its ability to produce natural language is the first and most basic ability to be discovered. In fact, the premise of human work is a worker's life experience. It becomes a word-for-word resume. Then a recruiter's expectation of a candidate becomes a word-for-word job description. These word-for-word things are actually simple and transparent in front of AI.

I believe these changes will deeply affect the future of the recruitment industry. I will talk about one positive side and maybe one slightly negative side. On the positive side, this trend of AI, its first initial usage, it has very strong understanding of human natural language and generate human natural language. And this is first found and can easily be understanding. So when people starting to find a job, turning to the word, it will become a resume. And when the recruiter is trying to hire someone, in the formatting of word, it will be a job description. So in terms of description, expression of resume and job description, This kind of wording format in front of AI is very simple and transparent, and it is easy to understand this can be very deeply affected.

I think I want to use a number to express my concerns about the news. For example, there is a platform that has 200 million articles that are all created by AI. On the other side, there are 40 million AI-generated job discrepancies. When this happens, what does it mean to represent the people behind it? And what does the so-called matching actually mean? I don't think this is new, because everyone knows When more and more people use AI to search and organize materials and write works, some historical facts that have been edited by AI do not exist. After a thousand repetitions, it becomes the history that once happened. I think a lot of our things are being contaminated. The large-scale decontamination pollution and the large-scale GD pollution have not yet occurred. I think we should

And the second one, on the next one is a concern expressed with numbers. For example, on a platform, there are over 200 million of AI-generated resumes. And on the other side, there are 14 million of AI-generated job descriptions. So under such conditions and circumstances, what is the meaning of the people behind all those resumes and jds and what our machines are matching for so this is not a new topic uh currently more and more people are using ai to search for for results to write articles and there will be more and more ai made up which is a historical fact that was not existed and with more than 1,000 times of repeat, that will become a fact. So a lot of things have been polluted. Now, the massive pollution of resume or job description has not started yet. So we need to be alert and prepared for that.

After deep-seek moment, what are our advantages? . . . . . . . . . . . . . . .

And after the deep moment, I have also been considering your question about what our advantage is. And I believe we do have some. First, we have been continuously investing in AI science in the past two years. We also have our own pre-trained model, which is quite good. We have a lot of AI application scenarios and accumulated a lot of unique user behavior and data. So I think that's something we have facing this challenge of this moment.

Since the chat GPT moment in 2013, two years ago, which is an AI moment in the spring, And your second question about our further investment in AI development, which I have always been considering.

recently. So in early 2023, that chat DPT moment, two years ago, seems like AI has been a spring moment. So we have spent more than 1 billion on purchasing GPUs with a lot of curiosity and a little bit of fear. So currently, we have stored enough computing power.

Before the chip was imported, we bought a few chips. Last year, the whole industry realized that justice is greater than power, and that computing is everything. In this situation, we were once... In terms of development and investment, we were once quite frustrated.

Before the restriction order of GPU purchasing, we have actually bought a lot of GPUs. But last year, under the overall environment, you need to have more and more GPUs and bigger and bigger computing power. Under that situation, we are a little bit awkward in our technology investment. So we cannot buy more, and we won't buy more.

So actually, DeepSeq gave a lot of people confidence, and it also changed the way It's an investment strategy. As Yijing said, if you're poor, you'll change. If you're rich, you'll have a future. In the face of the transformation of science and technology, we are often pushed by humans.

Actually, DeepSeq has given us very high confidence in terms of the strategy of investment. So as Yiqing has said, when challenges promote changes, and changes will lead to progress. So in the past, the big is the biggest, right? And money means the future. That situation has gone. And the technology innovation has brought changes to many things.

Zipfig's 671B open source model has actually made a lot of small and medium-sized Internet technology companies reach a relatively high and neat starting point in the large-scale model. So next, we should invest more time and energy in AI applications and AI agents like other similar-sized companies, and keep us on the AI science.

The open source of DIP-671B have enabled a lot of middle-sized internet companies to have the same level of AI capability with other large companies. We are at the same starting line. So in the future, we will, and many other companies will focus more on the AI application, AI agents, and continue

our explore in the AI science.

In my introduction earlier, I also talked about some of the methods we use in the AI application. Currently, we are making some rules.

In fact, we will maintain and expand

AI applications. And about our plan for our product roadmap,

I talk a little bit about our current products and services, and we will continue our exploration of AI application agents, and you will see upcoming launch of new services. And on the revenue side, which you may concern more, so from the AI to recruiters, We have one product which has been there for more than one year, and I think people might be interested to pay for that service, which can help increase the efficiency of achieving a mutual consent by 60% and saving the boss's time by more than 40%.

I think this product should be welcomed by the recruiters.

That's my answer to your questions. Operator, let's move on to the next question.

Thank you. Our next question comes from the line of Timothy Zhao from Goldman Sachs. Please ask your question, Timothy.

Good evening, Chairman Zhao. Thank you for accepting my question. I have two questions I would like to ask. The first question was shared by the management team. We have seen a trend of recruitment after the spring holiday, especially this year. Please share with us in more detail the needs of important enterprises, large enterprises, and small industries. What are the special changes? Especially, how do you see the continuity of the recruitment trend after the spring holiday? Thank you for taking my questions. I have two questions here. First, as you have shared a lot about the recruitment trend year-to-date, especially after the twice new year, could you imagine sharing more detailed color about the recruitment demand between different enterprise sites and also different industries? And more specifically, how should we think about the sustainability of the demand outlook? And second question is regarding the paying ratio and the output trend on the platform. For this year, how are we going to plan to increase the monetization rate for our pool on this platform? Thank you.

Compared to the Spring Festival in 2014, the number of jobs has improved significantly since the Spring Festival this year. The data is like this. So this year's spring recruitment season compared to last year, we find that the sequential trend has been quite strong.

But one number is that the online active job postings before and after the spring festival. So this year, the sequential growth is more than 173%, while last year is 141%. So this is a big picture.

The second point is that the recovery of Biling's industry documents And white collar industry are stably recovering.

So the highlight is that the AI related jobs have been helping with some sub-sectors or sub-industries of internet to start re-growing. One important point is that compared to last quarter, this quarter our overall cash in has shown an accelerating growth trend.

In terms of APU, I'm not aggressive enough to pull APU up at this time. Everyone is recovering. We're still recovering together. I think it's a bit slow. In fact, last year, everyone saw that APU was stable and alive. It's already such a situation. In addition, I'm not very... And on the APU side, they don't have a very strong motive to increase APU very aggressively.

I had witnessing recovery across different industries and different sides of companies. So I will give them space to improve together. So last year, we saw some good growth on the output side, and also stabilized the paying ratio. I don't have very big, aggressive plans to accelerate monetization, just waiting for things to turn better together.

In fact, I am more willing to say that China has a huge number of enterprises, and our model can serve all kinds of enterprises with such potential. I am willing to say on the data that after the end of the epidemic, we have newly served 6 million enterprises in the past two years. Among them, we have added 1.5 million of paid enterprises. I hope this number can help you in your judgment.

I would rather to look at things on the side of we are able to provide a service to different kinds of users, especially enterprises. Our model can provide service to different kinds of enterprises. There is a number that after the COVID reopening in the past two years, We have served accumulatively more than 6 million new enterprises and annual paid enterprise customers' enterprise numbers increased by 1.5 million. I hope this data can mean something and show our view on the growth potential. And that's my answer to your question.

Thank you. Our next question comes from the line of Wei Xiong from UBS.

Please ask your question, Wei. If we look forward to 2025, what marketing plans do we need to pay attention to? In fact, the overall profit rate of our company has been steadily increasing in the past few years. On this high basis, how should we consider the future long-term profit rate level? The second question is to ask about our blue-collar business. I would like to ask the management to share the recent income situation and customer feedback of Hailuoyouxuan. And then this year's blue-collar business, including the overall strategy and planning of other new businesses, thank you management for taking my question firstly I want to ask what's our current customer acquisition cost and how does it compare to a few years ago if we look at 2025 are there any major marketing or promotion plans that we should be aware of given the the continued margin expansion over the past few years How should we think about the long-term sustainable margin level for the company? And second, on the blue collar business, wondering if management could share the revenue contribution and client feedback from our current program. What's our strategic focus and planning for our blue collar business among other new initiatives for this year? And how should we think about the change in revenue mix from the blue collar segment? Thank you.

I'll answer the first question. Simply speaking, There's no big marketing campaign ahead in 2025. We are still at a faster user growth stage. Our user growth target for this year is set as over $35 million above for 2025. In terms of the selling marketing to our business is still with business leverage. Traffic acquisition per user today compared with prior years is much lower. This is mainly because of our brand awareness. So the overall selling marketing as percentage of total revenue, we continue to see this percentage going down. Except for marketing, other major costs and expensive items like COGS, sales expenses to the revenue, and also R&D expenses are all well under control. So looking ahead, the gross margin and the opening margin are all expected to further improve for the full year. as we communicated the last earnings call we will we hope to secure high quality bottom line growth first then we hope to actively look for additional upsides so we set our full year non-gap operating profit target as 3 billion rmb for 2025 which is 30 percent higher than 2.3 billion RMB non-GAAP operating profit for 2024. And lastly, our share-based compensation expenses, as I just mentioned in the prepared remarks, these expenses will decline sequentially, which makes our GAAP-based bottom line, GAAP-based bottom line net profit with even higher growth. So that's my comment to the margins and our financial focuses for 2025.

Hai Luo's words, thank you for remembering this name.

We've been talking about it for a few years. Hai Luo Youxuan, last year, I think China China China the number of users has increased significantly. The entire service covers more than 40 million users.

So, in this respect, I think this is worth it.

So, the development of AI is actually likely to bring changes to this matter. What changes? the well-trained bad guys actually have an advantage. But those good guys who don't have much time to enter the market may not have an advantage in this kind of large-scale recruitment. Now I want to say that AI has a chance to pull this off. If you are a well-trained bad guy, I'm afraid it's useless. This thing may bring changes. In.

Thank you for remembering Hilo, which we have been talking about for several years. So for the count flag Hilo ocean project, which is targeted for those agents with massive herring demands. So last year, we saw the contract amount, four-year contract amount for Hilo Ocean more than 200 million. So I think any new business have more than 2% of our revenue contribution and is growing is a good and valuable input. And also in the fourth quarter, the accumulated agencies who have joined Hilo improved by 21%. sequentially covered more than 40 million of job seekers. And with the development of AI, I believe things might potentially have some change. In the past, those well-trained white people, white agencies have always had their advantages. The new guys who have a shorter period of experiences, In the past, they don't have advantages, but now with the empowerment of AI, things are potentially to change to be equal. So when we initiated high law, we didn't foresee this, but now with potential changes, we will keep you updated and in progress. And also, we will keep our investment or exploring into closed-loop services and placement-related services. And that's my answer to your question. And given the time constraint operator, I think that's our last question for today.

Thank you. That concludes today's question and answer session. At this time, I'll turn the conference back to Wenbei for any additional or closing remarks.

Thank you once again for joining us today. If you have any further questions, please contact our team directly or TPG in that relation. Thank you.

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.