Here Group Limited

Good morning and good evening, ladies and gentlemen. Thank you for standing by and welcome to Qantas Sings Earnings Conference Call. At this time, all participants are in a listen-only mode. We will be hosting a question and answer session after management's prepared remarks. Please note that today's event is being recorded. I will now turn the conference over to Ms. Leah Gowal, Investor Relations Association associate director of the company. Please go ahead, ma'am. Thank you.

Hello, everyone, and welcome to QuantumSync's earnings call for the second quarter of fiscal year 2024. With us today are Mr. Peng Li, our founder, chairman, and CEO, and Mr. Tim Xie, our CFO. Mr. Li will provide a business overview for the quarter, then Tim will discuss the financials in more detail. Following their prepared remarks, Mr. Lee and Tim will be available for the QA session. I will translate for Mr. Lee. You can refer to our quarterly financial results on our IR website at ir.quantasync.com. You can also access a replay of this call on our IR website when it becomes available a few hours after its conclusion. Before we will continue, I would like to refer you to our Safe Harbor Statement in our earnings press release which also applies to this call, as we will be making forward-looking statements. Please note that all members stated in the following management prepared remarks are in R&B terms, and we will discuss non-GAAP measures today, which are more thoroughly explained and reconciled to the most comparable measures reported in our earnings release and filings with the SEC. I will now turn the call over to the CEO and founder of QuantaSync, Mr. Li.

Hello everyone and thank you all for joining us today. Last quarter, we saw a solid 24.7% increase in revenue, proving that our strategy to expand our course offerings is paying off. Following the past success of our financial literacy courses, we have been actively adding new courses to diversify our revenue stream. We are also seeing the opportunity presented by growing demand for courses made for senior learners. We adjusted our revenue presentation under other personal interest courses this quarter. We further broke down other personal interest courses into skills upgrading courses and recreation and leisure courses. We think the new revenue breakdown better reflects our business strategies and can provide useful and updated information to investors. Under the new breakdown, skills upgrading courses mainly include courses for training productive skills. such as short video production and memory training courses. Recreation and learning courses mainly include more personal enrichment courses, such as personal well-being courses, electronic keyboard courses, understanding meditation courses. Now let's pivot to discuss some new developments and initiatives with our organization. Recent government data has highlighted the strong growth of China's elderly population. China had over 297 million people aged 60 and above in 2023, which was 21.1% of the total population. As such, China has officially become a super-aged society. by World Bank standards. The silver economy is currently valued at around RMB 7 trillion, US $9.82 billion, and is forecast to surge to RMB 30 trillion, US $4.2 trillion, by 2035. This would meet up roughly 10% of the country's total GDP, according to China National Radio. The evolving needs and the desires of middle-aged and elderly people in China represent a significant opportunity for us. This is a growing demand for personalized services in the silver economy sector. In a positive mood, the government recently introduced mirrors to strengthen the silver economy. This initiative urges enterprises to enhance their offerings for the elderly population. For example, to enhance digital services, thousands of websites and apps are being revamped and the standards are being established for senior-friendly mobile devices. This development is also beneficial for us, as it will enhance the learning experience for our users from a hardware perspective. We are proud to have anticipated this shift in demand. We have been preparing for these opportunities for years. Our team has built a solid foundation and a mature business model, and we are well positioned to meet this growing demand. As living standards improve, middle-aged and elderly people seek more than just health or longevity. They want experience that will provide cultural and intellectual enrichment. Our diverse range of online courses includes many which are tailored to the interests of this demographic. Our platform is dedicated to lifelong learning. And we have always emphasized user engagement and satisfaction. This means we are all equipped to fulfill user desire for intellectual stimulation and personal growth. Now let's move on to our ongoing efforts to enhance user engagement and satisfaction. We've been diligently engaging our learners in a variety of offline and online initiatives, leveraging the power of AI to elevate users' learning experiences. Additionally, we utilize our scalable self-operated system to boost learners' repurchase rates. We have hosted a series of community events surrounding our recreation and leisure courses. These events include standing meditation sessions and appreciation sessions for pursuers like electronic keyboard and calligraphy, we provide ample opportunities for interaction, communication, and personal enrichment for our middle-aged and elderly users. For example, our recent initiative involved offering complimentary trial courses to residents of a community in Beijing. Our offline and online initiatives have resulted in constantly high levels of user engagement. Attendees of our sharing sessions speak highly of the valuable knowledge they gain from instructors and peers during events. We have received lots of positive feedback from participants for both our online courses and offline activities. Especially from elderly learners, they express deep appreciation for activities like calligraphy, understanding meditation, and recognize them as valuable opportunities for personal growth and learning. This feedback highlights their strong desire for spiritual and cultural enrichment, which emphasize the importance they place on these experiences. Among the variety of measures we have used to apply AI in our business, we have successfully enhanced live streaming quality using AI, improving both visual clarity the clarity and stream stability. Additionally, we have leveraged AI in our online tutoring system by intelligently identifying and anticipating learners' behavior. As a result, learners have been able to significantly reduce their waiting time during Q&A sessions with our tutors. Our commitment to learner satisfaction is closely followed by a more efficient approach to retaining our learners. Recently, we upgraded our integrated business management process and conducted tailored testing before rolling it out to more SQs. Our tutors can now easily manage tasks like one-click class reminders and optimizing private domain traffic. By doing so, we are not only increase our course completion rates, but also enhance overall repurchase. For example, the repurchase rate of our standing meditation course has improved from 20% 26.2% in last fiscal year to an impressive 34.7% in this quarter. We aim to streamline the operation system across all SQs and to maximize user retention on our platform. Next, let's turn to our efforts to increase operational efficiency while growing our top line. We remain focused on streamlining process and optimizing resource allocation. By carefully investing in sales, marketing, and leveraging technology, we aim to enhance our market presence Our test and scale approach ensures efficient results utilization, minimizes financial risk, and allows us to seize market opportunities. We are focused on streamlining processes and the results allocation to boost cost efficiency. We aim to ensure that the quality of our services also remain top notch. We have managed to limit our relative growth in headcount. This demonstrates our ongoing commitment to prudent Moreover, we are assembling a new team in Hefei. We efficiently capitalized on the cost advantages of operating in that region, including but not limited to labor cost and administrative expenses. also made improvements to our operational system. We developed our own instant messaging system, which has been officially deployed in this culture. The strategic move not only significantly reduce our operational expenses, but also enhance real-time interactivity among learners. We achieve highly efficient sales and marketing by leveraging technology. We are carefully allocating resources to enhance our marketer presence, for example. We leverage tech including big data and our advanced operational systems to create diversified and effective marketing channels. During this quarter, we upgraded our technologies so we were able to reach paying users more effectively. Meanwhile, We are employing a test and scale methodology. For this methodology, we invest modestly in new initiatives, such as new cost offerings, marketing campaigns, and less e-commerce product offerings. Then we access the ROI. We only take steps to process and expand the initiative if the ROI exceeds our expectations. This data-driven decision-making process maximizes our resource allocation and minimizes the financial risk for new initiatives. Also, by collecting feedback from the market and our customers, we gain a better understanding of their needs. This broadens our reach and enhances our ability to address shifting demand. The flexibility of our business model allows us to scale up our operations without sacrificing cash flow. Ultimately, this enables us to seize market opportunities as they arise. In addition to our ongoing efforts to drive revenue growth and maintain cost efficiency, we are actively pursuing new initiatives that offer significant potential for expanding and diversifying our business. Live e-commerce and overseas markets are important to broaden our revenue streams. Thus, we have launched a number of strategic initiatives in these areas. Live e-commerce provides an interactive platform to enhance sales and driven customer engagement. Recognizing this, We are currently leveraging live e-commerce to strengthen our online presence and increase our market share. We are also developing private label products that prioritize innovation and customer satisfaction. The recent launch of our private label Chinese Baijiu brand, Yunqing, is one example. Meanwhile, our focus on overseas expansion aims to access new markets and demographics, thereby diversifying our revenue streams and broadening our market reach. We are carefully planning our expansion strategy strategy for sustainable growth. TELUS Education serves as a key trial venture preceding broader international expansion efforts. We are closely monitoring its process to refine our strategies and inform further expansion plans. ensuring a prudent and well-informed approach to scaling our international operations. In conclusion, the second quarter of our fiscal year, 2024, demonstrated strong revenue growth, reflecting the success of our strategic initiatives. We have taken steps to diversify our cost offerings and to cater to burgeoning demands for middle-aged and senior learners. We are also actively pursuing new opportunities in live e-commerce and international markets while still maintaining a lean and efficient operational model. With a focus on innovation and prudent resource management, we are well positioned to sustain our growth trajectory and deliver lasting value to our shareholders. With that, I will turn the call over to Tim. to discuss the details of our financials. Thank you.