36Kr Holdings Inc.

Q1 2021 Earnings Conference Call

6/1/2021

spk05: Hello, ladies and gentlemen. Thank you for standing by for 36K Holdings Incorporation's first quarter 2021 earnings conference call. At this time, all participants are in listen-only mode. After management's prepared remarks, there will be a question and answer session. Today's conference call has been recorded. I will now turn the call over to your host, Jing Li, our manager of the company. Please go ahead, Jing. Thank you.
spk06: Thank you very much. Hello, everyone, and welcome to 36KR Holdings' first quarter 2021 earnings conference call. The company's financial and operational results were released early today and have been made available online. You can also view the earnings press release by visiting the AR section of our website at ar.36kr.com. Participants on today's call will include our co-chairman and CEO, Mr. Da Gongfeng, and our vice president of finance and capital markets, Mr. Lin Wei. Mr. Feng will start the call by providing an overview of the company and performance highlights of the quarter in Chinese, followed by an English interpretation. Ms. Wei will then provide details of the company's financial results before opening the call for your questions. Before we continue, please note that today's discussion will contain forward-looking statements made under the safe harbor provisions of the U.S. Private Security Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, the company's results may be materially different from the views expressed today. Further information regarding these and other risks and uncertainties is included in the company's prospectus and other public findings as well as the U.S. SEC. The company does not assume any obligation to update any forward-looking statements except as required under applicable law. Please note that 36K's earnest press release and this conference call include discussions of annuality gap financial measures as well as annuality non-gap financial measures. 36K's press release contains a reconciliation of the annuality non-gap measures to the annuality gap measures. And please note that all amount numbers are in RMB. I will now turn the call over to our co-chairman and CEO, Mr. Da Gongfeng. Paul, please go ahead.
spk00: Thank you. Hello everyone. Thank you for joining us today. In 2021, the Chinese economy has recovered from the pandemic. We have gradually restored the growth trend and further promoted 36G as the core competitive advantage of China's leading new economy content and service entry platform. We have further strengthened long-term investment in content, products, and technology. We believe that 36G will rise in the transformation of traditional enterprises and the rise of corporate services.
spk06: As we venture further into 2021, China's economy is gearing up for a new normal as it steadily emerges from the COVID-19 pandemic. In this context, we are steadily regaining growth momentum and focusing our core competencies as a leading platform for new economy growth-focused business content. and service offerings in China. With continuous long-term investments in our content, products, and technology, we believe we are well positioned to seize the immersed commercialization opportunities in the digital transformation of traditional enterprises, the rise of enterprise service markets, the further integration of private equity and public equity markets, and the shift toward short-form video across digital content industries. For the unlooking, for the unlocking values to our customers, users, and investors.
spk00: During the first quarter, we once again delivered record-setting performance in total user traffic with average monthly PVs
spk06: jumping to a new high of £829.3 million, representing a 75% year-over-year increase and a 32% sequential climb. This strong metric represents a top consecutive quarter of PV growth, underscoring our exceptional ability to generate new economic content, appealing to a broader and growing audience base.
spk00: The growth in our traffic and user engagement demand for advertisers continue to demonstrate growth momentum in the first quarter. They are delighted to achieve a 55% year-over-year jump in advertising revenue
spk06: amid increase in both the number of advertising customers and average revenue per advertising customer, compared with the same period of 2020.
spk00: Our existing and new online platforms all present a rapid recovery trend and are advancing into a deep marketing service mode. In addition to our overseas companies, local brands, and Internet giants, our online customers range from medical to health, artificial intelligence, and social media. We are very happy to see
spk06: Our existing and emerging advertising segments both recovered at a fast pace, propelling us toward a more comprehensive marketing service model. In addition to multinational corporations, domestic brands, and internet giants, our advertising clientele have covered more verticals such as healthcare, artificial intelligence, and social networking. We are present to see CertificateCare is increasingly become the go-to partner for faster new economy companies as well as elite brands.
spk00: In the first quarter, we continue to complete our content and services. This is also the basis of our commercialization. At the same time, we continue to implement our content platform strategy, PTC and UTC together, to further enhance the quality, depth, and breadth of content. Our content is continuously received from users. During the first quarter, we continue to refine our content platform and our product offerings, which are the foundation of our commercialization. Our content platform strategy remains intact,
spk06: as we are dedicated to further strengthening our content quality, depth, and diversity through both PGC and UGC. Our professional producer content continues to enjoy high popularity and a paralyzed word of mouth effect. We publish a number of insightful analysis reports, timely market updates, as well as thought-provoking editories and commentaries every single day. As a content platform, we also endeavor to attract and cultivate more quality content creators and continuously expand our content genres in order to cover more niche markets and assess broader user demographics.
spk00: In addition to our own platform, we continue to use external platforms to reach a wider audience. Currently, we are cooperating with almost all mainstream third-party content platforms, including WeChat, Weibo, Douyin, Kuaishou, Bilibili, and the newly launched Xiaohongshu. In addition to our proprietary platform, we continue to leverage external resources to expand our user reach. We now work with almost all major third-party platforms, including WeChat, Weibo, Douyin,
spk06: Kuaishou, Bilibili, and most recently, Xiaohongshu. In the first quarter, there were over 160 pieces of content published on 36K VChat official accounts that have gained readership of over 100,000 times each. In addition, our newly launched VChat accounts are used, customized for the younger generation and their lifestyle and business trends. It's well-received by the audience with a fast-growing number of followers.
spk00: In addition, we continue to expand our content in terms of video and audio content to reach a wider and younger audience. In the first quarter, our live broadcast and short video content strategy continues to increase the current traffic. Specifically, our video content of our assets is further recognized by the market. By the end of the first quarter, our total number of fans on the third-party video platform has exceeded 4.4 million, and the average has increased by 53%. Among them, the Bilibili 36 account attracted more than 64.7 million fans, Furthermore, we are enhancing our capabilities in video and audio content to broaden our offering metrics and resonate with a wider user base, especially the younger generation.
spk06: During the first quarter, our live streaming and short-form video content initiative continued to fuel additional user traffic growth. Specifically, our self-produced video content gained further traction with over 4.4 million followers on the third-party traffic platforms at the end of first quarter, up 53% sequentially. We attracted more than 647,000 followers on Bilibili, with our video content gathering over 16 million total views. On Douyin, our KR finance accounts attracted around 3.6 million followers, spurred by our high performance, transcending video content. Recently, we also created a content distribution account on Xiaohongshu, And we are excited to have witness fast-forward growth on this new channel as our short-form video content continues to gain popularity. In terms of commercialization of video content, we have entered into collaborations with a variety of Elite brands, including Elite, Ping An, Huawei, and HP, for video marketing services. Moreover, we are expanding our audio-based content, integrating multiple forms, including text, image, video, audio, and live streaming, all of which are aimed to providing customers with a comprehensive area of content marketing solutions.
spk00: In terms of the product, in the first quarter, we continued to upgrade the 36K app to promote the growth of our free platform users. We added a new iOS desktop component to the 36K app to provide users with a more convenient way to find and browse content. We also added a live broadcast function to the 36K app. Users can directly visit the live content on our free platform to experience more rich content. In the first quarter of 2021, the number of people living in the 36K app has increased by nearly 40%.
spk06: On the product front, in the first quarter, we continued to upgrade our 36Hair app in an effort to cultivate our organic and proprietary user growth. We added a new IRIS desktop widget feature to the 36Hair app, providing users with a more accessible and easy-to-use way to discover and browse content. We also enabled a new tab function on our 36Hair app for users to access live streaming content our own mobile app to deliver a smoother content viewing experience across our platform. For the first quarter of 2021, the average content consumption per person of the 36-pair app increased by nearly 40% on a year-over-year basis.
spk00: I would like to focus on the new second-tier market product that we have recently launched. For many years, ScienceLuke has accumulated rich experience and professional knowledge in serving new enterprises and first-tier market participants. Last but not the least, we recently launched a brand new
spk06: public active markets product. Over the years, 36KR has accumulated rich experience and expertise in serving new economy companies and private active market participants. It's a natural extension to provide services for the professional public active market sector and building on our proven accomplishments. We believe we can replicate this success with relevant public active market content and grasp new opportunities in this tremendous market. Our content and service offerings across pre and post APO companies exhibited rapid growth with positive market feedback. This strong performance reinforces confidence in our ability to drive growth in this promising field. 接下来我想与大家分享一下我们在企业服务领域的一些新的进展。 I would like to share some color of progress we have made with new initiatives across the enterprise services business space.
spk00: First of all, we are very happy to have achieved a solid progress in the business of enterprise service evaluation. Last year, we launched a 36-card enterprise service evaluation platform to help Chinese enterprises discover and choose information-based knowledge platforms for enterprise services. In fact, at the end of the first quarter, the enterprise service evaluation platform has already received more than 3,000 enterprise-based applications. In addition, this spring, We are excited to have made meaningful strides in our enterprise service review portal. Beta launched last year in a bid to build a digital destination
spk06: to discover and select enterprise services in China. The review portal has showcased over 3,000 enterprise service applications as of March 31st, 2021. More specifically, the review platform launched a ranking of business intelligence software on a rolling basis in spring 2021, featuring leading companies and industry experts in the BI space and prompting comments on various BI products from hundreds of enterprise customers. We also arranged exclusive meetings for BI software brands and enterprise customers to facilitate potential procurement transactions.
spk00: On the other hand, we are also actively promoting corporate services in more cities and regions, capturing a huge development opportunity for corporate digital transformation across the country. The regional expansion has also become an effective way for us to realize corporate service scale expansion. In addition, we are working diligently to extend our value-added enterprise service offerings
spk06: to more cities and regions in China to ride the wave of digital transformation. They are confident that our geographic expansion initiatives will foster our ability to scale up our enterprises, especially in partnership with local governments and value chain resources. In this spirit, during the first quarter, they pivoted to develop the collaborative opportunities between enterprises and the local governments in Henan, Shandong, and Hunan. To date, we have expanded our footprint into top cities, including Virginie Mac cities like Hangzhou, Chongqing, Chengdu, and Guangzhou. And we plan to expand to more of our provinces over time. These efforts supported our capabilities to build up a multi-phased and dynamic enterprise service ecosystem. Inspiring new economy-driven development across the nation through our engaging and valuable content, as well as our comprehensive service offerings. The development of the Internet in China has been viewing changes in economic systems as digital technologies have been redefining more and more economic activities. This includes digital information, digital merchandise, and digital finance. as well as an increasing share of business activities going digital. The COVID-19 crisis has especially accelerated digital transformation across a larger range of business activities. We believe that within the next 20 years, our economic activities will inversely go digital. Our internet companies and traditional companies will inversely evolve to new economic companies. we see huge opportunities emerging in the digital transformation journey across the board. And keeping this in mind, we are poised to set up our strategic efforts to grasp the growth potential.
spk00: On May 11, we held the Future Summit of China Fund Partners in Shenzhen, which gathered hundreds of mainstream investment institutions, including first-tier private fund investors, international investors, and world-famous equity investment funds. The summit's theme is based on the status quo of the first and second-tier markets. On May 11th, we hosted our China Fund Partner Future Summit in Shenzhen, attracting hundreds of mainstream investment institutions, which included first-tier LPs, international investment bankers,
spk06: and globally well-known active funds. This flagship summit featured a keynote on the dynamic opportunities and challenges facing venture capital and equity markets, bringing insights to our customers and users. And on May 12th, also in Shenzhen, we hosted the 2021 Wise Innovation Leader Conference. Dozens of industry KOLs, leading companies, and analysts attending the event focus on themes surrounding new technology, new consumer, and new healthcare sectors. Moving on to our subscription services. This is a firm commitment to serving the six major communities of China's new economy. Our subscription services have successfully engaged enterprises, governmental agencies, and capital across the country. For example, our iconic membership product, Ali Speedway Stock Class, brings direct resource support from the government for stocks This type of support was put in practice during the first quarter in Tianjin and Fujian, Guangdong. In summary, looking ahead to 2021, we believe demand for 36K and its diverse service offerings from a growing base of new economy participants will continue to thrive in the fast-involving digital business context. As a go-to content and service platform in the Chinese new economy space, We will continue to diversify our product and service offerings, as well as boost our community and user base. While exploring new growth avenues to enhance monetization, we are confident that our long-term fundamentals position us well to forge ahead in new business development.
spk00: Next, I will give the floor to our Finance and Capital Market Vice President, Wei Lin.
spk06: I will now turn the call over to our VP of Finance and Capital Markets, Ms. Lin Wei, who will discuss our key financial results. Please go ahead, Lin.
spk01: Thank you, Paul, and hello, everyone. Our first quarter results got the year off to a solid start. As Paul mentioned earlier, the rebound in market demand underpinned a strong 58% year-over-year growth in our advertising revenues in the first quarter. Also, as we continued to shift our resources and focus towards higher-margin businesses, we saw substantial year-over-year increase in both gross profit and gross profit margin. In addition, NAS loss narrowed substantially in this quarter compared to the same period of last year. Going forward, we remain dedicated to building on our content strengths and growing monetization channels to seize immense new economy opportunities. Now I'd like to walk you through more details on our first quarter 2021 financial results. Online advertising services revenue increased by 58% to RMB 33.2 million in the first quarter of 2021 compared to RMB 21 million in the same period of last year. The increase was primarily attributable to the strong recovery and growth of market demand in the first quarter of 2021. Enterprise value-added services revenue were RMB 6.9 million in the first quarter of 2021 compared to RMB 42.8 million in the same period of last year. The decrease was primarily because we continuously shifted our focus toward higher margin businesses, and starting from this quarter, we ceased to act as a principal in certain low-growth margin businesses and only acted as an agent. As a result, revenues of such businesses were recognized on a net basis from this quarter onward. To increase comparability of operating results, and help investors better understand our business performance and operating trends, we introduced the gross transaction value as a supplemental metric to describe our business. Gross transaction value of enterprise vital additive services was RMB 32.5 million in the first quarter of 2021 compared to RMB 42.8 million in the same period last year. Subscription services revenue increased by 154% year-over-year to RMB 3.4 million. The increase was primarily attributable to the growth in institutional investor and enterprise subscription services. Total revenues were RMB 43.5 million in the first quarter of 2021 compared to RMB 65.2 million in the same period of last year. This is mainly due to the aforementioned change of revenue recognition for our enterprise value-added services, where there's a RMB 25.6 million variance between net revenues and gross transaction value. If you do the math, you will see actually our overall business trend is upward and demonstrated solid year-over-year growth. Cost of revenues decreased by 66% year-over-year to RMB 20.2 million in the first quarter of 2021. The decrease was primarily because we continuously shifted our focus toward higher growth margin businesses, as we mentioned earlier in the enterprise meta-added services section. Growth profit was RMB 23.4 million in the first quarter of 2021, representing a 329% increase year-over-year. Growth profit margin was 53.7% in the first quarter of 2021, compared to 8.4% in the same period of last year. Operating expenses were RMB 64.8 million in the first quarter of 2021, representing a 37% decrease year over year. This was mainly due to the decrease in G&A expenses in the first quarter of 2021. Sales and marketing expenses were RMB 35.7 million in the first quarter of 2021, compared to RMB 34.9 million in the same period of last year. G&A expenses were RMB 20.2 million in the first quarter of 2021, compared to RMB 59.3 million in the same period last year. The decrease was primarily attributable to the decrease in the allowance for doubtful accounts and share-based compensation expenses. Research and development expenses were RMB 9 million in the first quarter of 2021, compared to RMB 8.5 million in the same period last year. The increase was primarily attributable to the increase in payroll-related expenses, partially offset by the decrease in share-based compensation expenses. Share-based compensation expenses recognized in cost of revenues, sales and marketing expenses, research and development expenses, as well as G&A expenses, totaled RMB 2.7 million in the first quarter of 2021, compared to RMB 13 million in the same period of last year. Net loss was RMB 40.5 million in the first quarter of 2021, compared to RMB 95.9 million in the same period of last year. Non-GAAP adjusted net loss was RMB 37.8 million in the first quarter of 2021 compared to RMB 82.9 million in the same period of last year. Net loss attributable to 36 KR Holdings honorary shareholders was RMB 39.5 million in the first quarter of 2021 compared to RMB 95.4 million in the same period of last year. Basic and diluted net loss per share were both RMB 3.8 cents in the first quarter of 2021 compared to RMB 9.3 cents in the same period of last year. As of March 31st, 2021, the company had cash, cash equivalents, and short-term investments of RMB 174.1 million compared to RMB 209.2 million as of December 31st, 2020. The decrease was mainly attributable to an equity investment we made in the first quarter of 2021 with a total cash consideration of approximately RMB 30 million. This concludes our prepared remarks today. We will now open the call to questions. Operator, please go ahead.
spk05: Thank you. Participants who wish to ask a question, please press star 1 on your telephone keypad and wait for your name to be announced. If you wish to cancel your request, please press the pound or hash key. For the benefit of all participants on today's call, if you wish to ask a question to management in Chinese, please immediately repeat your question in English. Thank you. Once again, it's star 1 on your telephone to ask your question. Thank you. We have the first question from the line of Vincent Yu from Needham & Co. Please go ahead. Vincent, your line is open. You can ask your question now. Once again, Vincent from Needham and Company. Your line is open. You can ask your question now. Thank you.
spk04: Thank you, Benjamin, for taking my question. I have two questions. First question is, can Benjamin share a comment on overall market recovery in first quarter 2021? And have we seen any changes? that we can share for the rest of the year. So second question is, can I share a comment on the client's S-spend with 36KR? It was mentioned that some international clients have reduced their spending. Have they returned? And how is the overall spending and engagement by client this quarter? Yes, thank you, Benjamin.
spk00: Okay, thank you, Vincent. First of all, the first question is about Q1. We noticed that as the impact of the epidemic gradually passed, we saw that the situation of various industries at the macroeconomic level should be improving, especially some advanced enterprises, which is a historical increase. Therefore, the 1.7% advertising of 36G also showed a strong increase in market share, which is 58% compared to the increase. and the number of customers and the price of the products have been greatly improved. We can analyze that many of the industries have achieved more than 100% growth, such as consumer life, e-commerce, artificial intelligence, and the consumer health industry, especially the medical health industry, which has achieved an explosive growth. We are actively monitoring the rapid development of the artificial intelligence and medical health industries in recent years to promote customers in these popular industries. Many of these customers are new customers that we have not cooperated with before. In addition, from the previous year, the number of brand customers, especially the advertising investment of overseas advertising customers, is expected to increase in the next year or so.
spk06: As the worst of the pandemic appears to be behind us, we are seeing solid economic recovery and gradual improvements across various industries. More specifically, a few new economy companies spearheaded the growth in the aftermath of the pandemic. As such, our advertising business gathered strong momentum in the first quarter, with year-over-year revenue growth of 58%. Advertising services for our new economy customers continue to grow, both in terms of number of advertising customers and average revenue per advertising customer. And we achieved more than 100% growth each in advertising services for several verticals, such as consumer and lifestyle, e-commerce, artificial intelligence, and healthcare. In particular, advertising services for healthcare customers delivered explosive growth. We are actively managing to tap into rising opportunities in the artificial intelligence and healthcare space and attract new customers. And looking forward to 2021, we expect advertisement demand from branded customers, especially multinational brands, to increase compared with last year.
spk00: Okay, I'll go back to the second question. Our online customers are mainly traditional customers and new business customers. Cross-border company customers are an important part of traditional customers. Of course, last year, due to the impact of the epidemic, cross-border company customers were greatly affected. However, we noticed that this year, cross-border companies have begun to gradually recover their online sales. The price of traditional customers increased by 11% in the same period last year. Since the first quarter is the official period of the company's traditional online sales, we expect that in the next three quarters, the price of traditional customers will increase significantly. In addition, we see that more and more growth comes from local new business companies, such as new consumer companies and artificial intelligence companies. We are gradually enriching the style of advertising products, such as video advertising, to attract more advertising customers. Some consumer brand customers are more interested in video advertising. They want to reach new consumers through the video content of 36g. Some customers who are re-branding hope to launch video advertising in 36g to complete the transformation and upgrade of brand image. We are very happy to see I'll do a quick translation.
spk06: We categorized our advertising customers into traditional customers and new economy customers. The multinational companies accounted for the majority of traditional customers. In the first quarter, we saw average revenue per traditional customer increase 11% year-over-year. The first quarter is traditional slow season for advertising demand. We expect average revenue per traditional customer to see substantial year-over-year growth in the following quarters. And along with global recovery from the pandemic, we saw advertising demand from multinational customers greatly rebounded. We also saw stronger growth in advertising needs from domestic new economy companies, such as those in the new consumer and AI sections. Meanwhile, we are making progress in improving our advertising products, such as video advertisements, to attract more customers. Some consumer brands have higher interest in this kind of product, as they would like to reach to more new customers this folder to 36pair's video content. In addition, customers who are rebuilding their brands expect to complete a transformation of brand identity by leveraging 36pair's video advertising products. In this regard, 36pair has become an important partner for traditional brands that are in their transition towards new economy companies.
spk08: Thank you. Thank you.
spk05: Thank you. We have our next question from the line of John Ding from Credit Suisse. Please, go ahead.
spk08: Thank you. Good evening, management. I have a question here on behalf of Camerphone. Can you comment on this quarter's gross profit margin in relation to the business change nature and also the outlook for the GPM in 2021 because I understand the circumstances that they've changed the accounting recognition to the net basis and also the business for services is shifting from the role of principal to the agent. Thank you, management.
spk01: Hi, Joanne. This is Lynn. I will take your question. Yes, you can see that our Q1 growth margin actually was a substantial increase compared to the same period last year. Our growth margin climbed to 64% this quarter compared to 8.4% last year. I think there are a couple of reasons here. First of all, obviously, we have been shifting our focus towards higher margin businesses, as I said. earlier, and also we're implementing some cost control measures. So altogether, this helped our gross profit and gross profit margin to increase. And secondly, as you also mentioned, starting from this quarter, we're starting to rack the net revenue for our enterprise value-added services. So this will not affect our gross profit, but it will definitely help increase our gross profit margin to some extent. And I also want to highlight that, as you mentioned, yes, we changed the revenue recognition for our enterprise value-added services revenue from this quarter onward. And actually, if you take that into consideration and if you do the math, you will see that our overall business trend is upward compared to the same period last year and have demonstrated solid growth. And the reason as we explained in our earnings release as well as in our prepared remarks is because we shifted our focus and resources to higher margin business. So as a result, for some lower margin businesses, we only act as an agent and where previously we act as a principal in these businesses. That's why we started to recognize net revenue for those businesses. And also for your question on the outlook of growth margin trend for the remainder of the year 2021, I can assure you that our growth margin will be on a continuous improvement trend for the rest of the year. Hope this answers your question. Thank you.
spk08: Sure. Thank you. That's very helpful.
spk05: Thank you. We have our next question. From the line of Shehan Zhao from CICC, please go ahead.
spk07: I will translate myself quickly. Should the management share more color on the details and future strategy of the new product, such as enterprise service review portals? Thank you.
spk00: Thank you, Dr. Zhao. It's been a long time. Qifu.ping is a new online decision-making platform that we launched last year to help Chinese companies purchase corporate services. It's a new attempt for us in the field of corporate service. Currently, its latest data has already included more than 3,000 enterprise-based applications, mainly in the BI, CRM, and co-operative office areas. You know, in the Qifu field, there are actually a lot of key areas, so we are now We are trying to start part of it. Another point is that we put our focus on the accumulation of our content and data. In the next period of time, we will accumulate more data and content. But we are gradually trying to help our customers. We will start this process as soon as possible to show you our progress. Thank you.
spk06: Okay, I'll do a quick translation. Our enterprise service review portal has been our latest attempt in the field of enterprise-related services. We better launched it last year in our bid to build a digital definition to discover and select enterprise services in China. The review portal has showcased more than 3,000 enterprise service applications made in the field of BI, CRM, and collaborative posts. This year, we expect more enterprise service suppliers to come to our platform by addressing enterprises' digital transformation demands. We aim to further leverage our Stella brand's high-quality content offerings and data insights to provide enterprise service providers with a platform to acquire customers. Thank you.
spk07: Thank you. Thank you very much.
spk05: Thank you. Can we move to the next question?
spk03: Yes, please.
spk05: Thank you. We have the next question from the line of Jay Dung from TH Capital. Please go ahead.
spk02: Yes, thank you for taking my question. I have one question here. How is the process of publicly distributing market's products? Thank you.
spk00: Thank you, Jay. We have recently launched our second-tier market products, which comprise of small and medium-sized companies, small and medium-sized companies and investment institutions, as well as exchanges and other second-tier market participants. And then our content mainly includes in-depth content analysis, industry research reports, offline activities, and other products and services. This service has been launched and has received widespread attention from customers. And then further verified our ability to expand to the second-tier market. We are very confident that the next second-tier market product will become one of our most representative typical products in the field of content and service.
spk06: We recently launched a brand new public active markets product, providing thought-provoking editories and commentaries, insightful analysis reports, and premium offline activities to participants in the public active markets, including pre-IPO companies listed companies, funds, and securities companies. Our public active markets product has gained popularity since its launch, which proves our ability to drive growth in this promising field. And we are confident this new product will become a classic product in content and service offering field, which strengthens our current content and service offerings in the private market of private markets and extend to a broader field. We believe in the great potential in the public active markets. Thank you.
spk02: Thank you.
spk05: Thank you. Can we move to the next question?
spk01: Yes, please.
spk05: Thank you. We have the next question from the line of APQ from Industrial Securities. Please go ahead.
spk09: Hello, Mr. Wang. I would like to ask about the development of short video. Can you please give us a brief introduction about the short video business model? Is it a comprehensive model of advertising and corporate services? I will translate my question. Hi, management. I have a question about a shall we do business. Could you explain more about the monetization program based on this new infrastructure? And is it a combination of advertising and enterprise service? Thank you.
spk00: Okay, thank you. First of all, let me introduce some of the data we have in this area. First of all, we started a short-time business. It's been less than a year, and it's still a new business. But I'm very happy to see that our content, which we think is relatively colorful, is still very popular among young users. So today's data shows that as of Q1, our number of fans on the third-party platform has reached 4.4 million, and the average growth rate is 53%. Among them, at Bilibili, when we reached Q3, we had about 650,000 fans, and the number of views on the video was more than 60 million. On Douyin, Our financial account has attracted almost 3.6 million fans. At the same time, we have recently established our account on Xiaohongshu and several other channels, and they are still relatively popular. In addition, in terms of video painting, we are trying to do commercialization with a large number of high-quality customers, including famous brands such as Yili, Ping'an, Huawei, and Huipu. What kind of service do you know about this service? First of all, it is an ad service. It continues what we have been doing I'll do a quick translation. We launched our shop from video initiative within a year.
spk06: and we are happy to see that we are gaining a growing number of followers on our account on Bilibili, Douyin, and recently in Xiaohongshu. I'll share some numbers of our current short-term videos. During the first quarter, our self-operated video content gained over 4.4 million followers on the third-party traffic platform at the end of the first quarter of 53% sequentially. They attracted more than 647,000 followers on Bilibili with our video content gathering over 60 million total views. On Douyin, our KR Finance account attracted around 3.6 million followers spurred by our high-performance training video content. And recently, we also created a content distribution account on Xiaohongshu. And currently, we have cooperated with some elite brands, for example, like Yili, Ping An, Huawei, and HP. And our current monetization model for our short-form video is mainly advertising, but We will expand our current services to more comprehensive services, including training and contests for our customers to better serve their needs in this new economy content space. Thank you.
spk05: Thank you. Our next question comes from the line of Ryan Lee from AMTD. Please go ahead.
spk03: Hey, hello. Thanks for taking my question. I want to know more about the enterprises services. How the progress of your offline activities and which industry will be the most attractive or popular this year. Thanks.
spk00: Thank you, Brian. Since this year, we have been gradually recovering from the current activities and services. Just in May, we successfully held a fund partner summit and a foreign funder conference in Shenzhen, discussing the trend of the first and second-tier market, discussing the latest trend in the field of 5G, new consumption, and healthcare, and we had a live broadcast at the same time, receiving a lot of positive feedback and good reviews from the participants. I think one of the trends is that we have seen Every industry is rapidly moving towards digitalization, including information digitalization, commercial digitalization, service digitalization, and financial digitalization. We believe that in the next 20 years, all kinds of companies will become new economy companies, and they will have the characteristics of new economy, which means that traditional companies will also be able to get rapid growth and rapid financing like new economy companies after this wave of digitalization. And quickly centralized. So I think this is one of the major business opportunities. This is also a very good and familiar field for Sinovac. Talking about this hot industry, I think there is no doubt that new consumption is the most important and most concerned hot point at the moment. And then, for example, 5G, new infrastructure, and healthcare are all industries that are very much concerned about capital recently. So we, Sinovac, are at the forefront of information. We will continue to provide more value to the participants of our content sensitivity and our increased service for the new industry. Thank you.
spk06: Okay, I'll do a quick translation. Our offline events are recovering gradually. Recently in May, we successfully hosted China Fund Partners Future Summit and the 2021 Wise Innovation Leader Conference in Shenzhen, where we discussed investments and financing trends in the private and public equity markets. As well as the latest industry trends in three major fields, including 5G technology, of new consumer and healthcare. We also made the events accessible via livestream and received positive feedback and recognition from many event attendees. We see various sectors taking up digital transformation, including digital information, digital merchandise, digital service, and digital finance. We think within the next 20 years, most of the business activities will virtually go digital. As the broader business development goes digital, it will generate tremendous opportunities. Moving to the hot industries, we think new consumer is the most hot industry and has attract a lot of attention from the capital. And also 5G technology, healthcare and new infrastructure healthcare are gaining widespread attention across capital markets. 36-Pair stands as the frontier of new economy-focused information. and remains committed to providing more value to new economic residents with high-quality content offerings and value-added services. And we think we can provide better services to our clients and customers in the new economy business space. Thank you.
spk03: Thank you. Thank you so much.
spk05: Thank you. As there are no further questions now, I would like to turn the call back to the company for any closing remarks. Thank you.
spk06: Thank you once again for joining us today. If you have further questions, please feel free to contact 36 Health Investor Relations through the contact information provided on our website.
spk05: Thank you. This concludes today's conference call. You may now disconnect your line. Thank you.
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