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spk02: Hello, ladies and gentlemen. Thank you for standing by for Features, Inc.' 's fourth quarter and fiscal year 2020 earnings conference call. At this time, all participants are in a listen-only mode. After management's remarks, there will be a question and answer session. Today's conference call is being recorded. I'll now turn the call over to your host, Effie Kang, Head of Capital Markets for the company. Please go ahead.
spk06: Thank you very much. And hello, everyone, and welcome to the EGINX fourth quarter and special year 2020 earnings conference call. We released our financial and operating results via use-wise services earlier today, and they are available online. Participants on today's call will include our founder and CEO, Mr. Marco Lai, and our acting CFO, Ms. Chen Fangli. Management will begin with prepared remarks, and the call will conclude with a Q&A session. As a reminder, this conference is being recorded. In addition, early highlight presentation and a webcast replay of this conference call will be available on the IR section of our website at ir.v2.fm. 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. These statements technically contain words such as made, will, expect, target, estimate, intend, believe, potential, continue, or other similar expressions. forward-looking statements involving heavy risks and uncertainties. The accuracy of those statements may be impacted by a number of business risks and uncertainties that could cause actual results to differ materially from those projected or anticipated, many of which factors are beyond our control. The company is affiliated with writers, representatives, and underwriters do not undertake any obligation to update this forward-looking information, except as required under the applicable law. Please note that we just only present these, and this conference call includes discussions of unaudited gas financial measures, as well as unaudited non-gas financial measures. Li Zhi's press release contains a reconciliation of unauthentic non-guest measures to unauthentic guest measures. I will now turn the call over to our founder and CEO, Mr. Marco Lai. Please go ahead.
spk01: Hello, everyone. Thank you for attending today's press conference. First of all, on behalf of Li Zhi, I would like to express my sincere gratitude to all the shareholders and supporters over the past year.
spk06: Hello, everyone. Thank you for joining us today. First of all, on behalf of Weizhi, I would like to express my sincere appreciation to all of our shareholders and stakeholders for their support over the past year.
spk01: In the past year, even though the world has faced unprecedented challenges and uncertainties, for example, 2020 is still a year full of ups and downs. Despite unprecedented challenges and extraordinary levels of uncertainty across the globe in the past year,
spk06: 2020 was a landmark year for Li Zhi. The company was successfully listed on the NASDAQ global market. In addition, we strengthened our leading position in the audio industry by building up a comprehensive audio-centric ecosystem consisting of audio-based social networks, podcast content portfolios, and audio communities.
spk01: the global online audio market has made breakthrough progress. Our user group is also expanding. In the fourth quarter, our mobile end average number of monthly users increased by 13%, reaching 58.4 million. In terms of commercialization, our income in the fourth quarter increased by 16%, reaching RMB 4.2 billion. This has greatly exceeded the scope of our previous expectations. In this quarter, we continued to implement non-US general accounting rules.
spk06: In 2020, we made breakthrough progress in the global online audio market, and our user base continued to expand. In the fourth quarter, our average mobile MAUs increased 13% year-over-year to a new high of 58.4 million. In terms of commercialization, our fourth quarter revenue grew 16% sequentially to RMB 420 million. exceeding the top end of our guidance range. In this quarter, we once again posted a positive non-gap net profit.
spk01: I would now like to share more information on our business operations.
spk06: particularly on how we pivot to a comprehensive audio-based ecosystem that integrates social network, content, and community to support our long-term development.
spk01: First of all, with the spread of voice and social media around the world, we have also made breakthrough progress in expanding the global market. In the summer of 2020, we started to expand the audio and video market in the UK, And in October, we introduced TIA into the US market. After TIA was launched in the US, it quickly entered the top 4 on the US social network. Now, TIA's users have reached more than 200 countries, and the top 10 on the social network of more than 70 countries. TIA can quickly match and support audio and video in a way that satisfies users' needs for social media. Through the AI-enabled matching system, we can achieve accurate matching within three seconds and connect more users, allowing users to interact with the products based on different topics. Users can chat on the platform, have fun, have fun, chat online, and share tips on how to compare life, We have a clear and unique product positioning for DIA, which is to play with friends, and to spend interesting time with friends. This makes it significantly different from other audio products. With audio application in the scene, and privacy protection, this is a unique advantage in terms of interaction. We believe that there are more offline social behaviors that can be implemented in this way. to the online market. In the future, we will continue to expand the use of TIA, enrich the product form, and expand the global market. We hope that TIA can become an important factor in our audio product combination, so that more users around the world can connect through sound.
spk06: First of all, with the rising popularity in audio-based social networking around the world, we have made breakthrough progress in broadening our global footprint. In the summer of 2020, we began to explore audio market opportunities in English-speaking countries and then introduced our TRS to the U.S. market in October 2020. Shortly after its launch in the U.S. market, TS sold to the top four in U.S. social networking app trends. Currently, TS users spread over 200 countries, ranking among the top 10 social networking apps in 70 countries at peak times. TIA is able to provide quick user matching and real-time online audio to address users' needs for social networking. With powerful matching systems driven by AI technologies, TIA can accurately match users within three seconds by bringing users together and allowing them to have real-time social interactions based on various topics and scenarios. TIA enables users to virtually meet friends with the same interests, entertain, chat online, and share their daily lives. We have a clear and unique product proposition for TIA, which is play with friends and emphasizing companionship spending time with friends, and having fun, which effectively differentiates it from other audio products. Due to superior experiences that audio products can provide in terms of privacy protection, real-time interaction, and multi-scenario accessibility, we believe that more social networking activities may be shifted from offline to online through audio. In the future, we will continue to expand usage scenarios for PIA, enrich its product features, and further penetrate the global market. We expect PIA to become a critical pillar of our audio product portfolios and enable more users across the globe to connect with each other through voice.
spk01: In terms of content, based on the characteristics of the UGC community, we continue to move Using the creativity of creation and enriching and expanding our content supply, in the fourth quarter, the number of new audio and video content increased by about 20 million, creating a new height. Since December 3, 2020, the number of audio and video content on the platform has reached a total of 2.5 billion, which is 43% of the total growth. In addition, we have further strengthened The scope of cooperation with star artists covers many fields such as actors, actors, singers, and so on, and provides more high-quality and interesting content to increase the popularity of the platform and attract their fans.
spk06: In terms of content effort, building our unique UGC community, we continue to reach and expand our content offering by motivating users to create content. During the fourth quarter of 2020, the number of new audio content uploaded to our platform reached a new record high of about 20 million as of December 31st of 2020. The cumulative number of audio content reached 264 million, representing a 43% year-over-year increase. In addition, we further stepped our efforts in our cooperation with the liberties in a wide area of genre, such as actors or actresses, the liberties from variety shows, singers, and writers, in order to increase high quality and interest in content offerings. Boosting user engagement will present a strong appeal to all standards.
spk01: In order to strengthen our layout in the field of product blogging, we launched a brand new top-of-the-line content platform in January this year, LiZi Blogging. We believe that blogging has its uniqueness in terms of content sharing. It is different from the paid knowledge platform for students. The broadcast is easy and interesting, and it has a great market potential. With a large number of content words accumulated over the years through the LIS APP, LIS broadcasts original and premium content, and at the same time, co-created exclusive content created by industry elites. It combines the IP of super broadcasts with the content of more diversified high-quality broadcasts in various fields. We hope to build a larger broadcast ecosystem through RIS播客 to help us gain a broader impact and attract a more diversified user group, including white-collar and middle-aged users. Through our AI-driven individualized specialization, RIS播客 users can enjoy a more superior individualized broadcast search experience. In addition, we have launched As a way to help companies to increase brand awareness. In the second half of this year, we have cooperated with China's leading trend culture and entertainment company, Taobao Mark, to create the first Taobao Mark brand blogger. Next, we plan to cooperate with more companies and brands to explore the market opportunities brought by this new media industry.
spk06: To bolster our strategy in the premium podcast space, we have rolled out a brand new vertical content platform each podcast in January 2021. We believe that the podcasts are unique as a content medium. In contrast to audiobooks and paper knowledge platforms, Podcasts are relaxing and intriguing and have vast growth potential. BG Podcasts features premium curated content from BGF's massive content library built over the years. In addition, in order to deliver diverse and high-quality podcast content, it also collaborates with various industry emails to offer inclusive podcasts and motivates celebrities from all walks of life to cultivate prestigious podcast IT brands. We hope that through LiZhi Podcast, we will be able to build a larger podcast ecosystem and appeal to a broader audience base, such as white-collar and more young and middle-aged users. Powered by AI-driven personalized recommendation engine, LiZhi Podcast users are able to enjoy superior and unique podcast listening experiences. Additionally, we have introduced the Branding Podcast on Weizhou Podcast as a new way of helping companies to increase brand awareness. For instance, in February this year, we partnered with PopMart, a leading pop culture and entertainment company in China, to create the first Branding Podcast. We plan to cooperate with more companies and brands in the future to explore the market opportunities brought by this new medium.
spk01: In order to fully utilize the advantage of audio in multi-end users, provide better audio experience to users, and meet the needs of audio listening in multi-end user scenarios, we also actively expand the audio display market. At the same time, we also reach a wider audience through audio display products. We believe that the future of car storage scenarios will become a very important application scenario for audio and video. Currently, we have successfully established cooperation with many leading car manufacturers in China, including Xiaopeng Car, Guangqi, and Biadi, etc. In addition, we have also launched a new audio and video scenario on Huawei's smart car storage cloud service solution HMS4Car. so that more users can enjoy the individualized audio experience on the way. At the same time, we can also communicate with each other via mobile phone and mobile phone, which allows us to achieve wireless switching between devices, which brings us a better user experience. We believe that our rich content supply, long-term operating experience, and industry-leading technology can further enhance our competitive advantage in the podcast market.
spk06: In our pursuit of giving full play to the advantages of audio products across multiple devices, providing users with superior audio experiences, and making users' listening needs in diverse usage scenarios, we are forging ahead with encouraging programs in the in-car audio market. without compelling in-car audio products, we expect to reach a broader user base. We believe that the in-car scenario will become an important usage scenario for audio products in the future. In this spirit, we established a collaboration with multiple leading automobile companies in China, including Expo Motors, GAC, and BYD. We also launched VJ's audio products on Huawei HMS Sport Car, a smart in-car cloud service solution, enabling more users to enjoy personalized audio experiences while driving. Meanwhile, we enabled shared accounts between users' in-car apps and mobile apps so that users can seamlessly switch between different devices and achieve better user experiences. We believe that our rich content offerings are creating experiences accumulated in the past. and the industry's leading technologies can further enhance our competitive advantages in the core customer market.
spk01: In terms of community ecology, we have been actively promoting the positive activity of the Indian community on the example of APU, especially the focus of the society, the connection and interaction between households and users. For example, at the end of 2020, we held a theme event called 2020 One Fast Fast, by inviting star artists to share their achievements in 2020 and their plans for 2021 through voice reviews. This event has gained 200 million views on Weibo and has been played more than 1 million times on our platform. In addition, we have also increased the participation rate of users through various community events. At the end of 2020, we held a special annual event It attracted about 130,000 broadcasts and live broadcasts. It showed about 160,000 broadcasts and 32,000 live broadcasts. We also selected excellent creators and gave them awards. Due to the effective operation of community ecology, this season's platform productivity continues to increase. In this quarter, the total number of interactions has exceeded 3.3 billion times, breaking the record record. In addition, we continue to continue to dig and cultivate excellent content creators through recovery projects and other supporting projects to help content creators grow. We introduced hundreds of excellent bloggers in the recovery project I.0 launched last year. In the future, we will continue to focus on enriching the ecosystem of our community and provide a lively audio community for a wide range of users, and satisfy users with information on audio creation, content sharing, and interaction.
spk06: Turning to our community ecosystem, we have been actively working to uplift the vibrancy of our audio community on VHF, especially to increase user interaction and connections surrounding top social topics. For example, at the end of 2020, we hosted an online event called 2020 Fast Forward with OneClick, in which we managed the liberties to share their achievements in 2020 and their plan was 2021 through audio. The event exposure on Weibo reached 200 million times, and related podcasts were played over 1 million times on our platform. In addition, we hosted various community events to increase user engagement. Our annual DigiWay Scala held at the end of 2020 gathered around 130,000 podcasters and live training calls and showcased approximately 160,000 podcasts and 320,000 live streaming audio sessions. Li Zhi also selected and awarded exceptional content creators during the gala. Thanks to the effective operation of the community ecosystem, user engagement on the platform continues to improve in the fourth quarter. with an average monthly interaction reaching a new record high of 3.3 billion times during the period. Furthermore, we continued to utilize various supportive programs, such as AppleBand, to further discover and cultivate outstanding content creators and help them to grow. The AppleBand version 2.0 launched last year attracted several hundred high-quality podcasters to our platform, Going forward, we will remain dedicated to enriching our community ecosystem to provide users with a vibrant audio community and satisfy users' needs for audio creation, content sharing, communication, and interaction.
spk01: In order to further enhance our frequency influence and gain a wider audience worldwide, we will continue to create more connections and companions for our local people through our audio products. I am full of confidence in LIS's development prospects. I believe that with our unique voice social ecology, rich audio content and high-quality audio community, In summary, what we achieved in 2020 has provided us with invaluable experiences and laid out a solid foundation for our future growth.
spk06: In 2021, we will remain committed to creating more connections among people around the world and offering them more companionship through our online audio products as we aim to further increase our brand awareness and reach a wider audience base all over the world. I am confident in YouTube's development prospects. I believe that with our unique audio-based social networking ecosystem, rich audio content offering, and highly engaged audio community. We are well-conditioned to capture the huge potential in the online audio sector. Fourth, our vision is continuous audio-centric innovation and make LiZhi a leading audio platform globally.
spk01: Thank you, everyone. Next, let's have our CFO, Lu Chengfang, introduce us to the financial industry.
spk06: Thanks, everyone. With that, I will now turn the call over to our acting CFO, Ms. Shen Fanglu, who will discuss our financial results in more detail.
spk05: Okay, thank you, Michael. Hello, everyone. First, we are very pleased with our better than expected top-line performance in the first quarter, which underscores our continued growth trajectory. While we grew our top line, our profitability also improved with the year-over-year increase. in gross margin of 1,070 basis points and positive long-gap net income. In the fourth quarter, our total net revenue increased by 15% to RMB 420.3 million from the same period of 2019. Currently, we generate our revenues primarily from our audio entertainment benefit, which contributed RMB 414.7 million to net revenues in the fourth quarter of 2020. and represented year-over-year growth of 50%. The increase was mainly due to the increasing in the per capita user spending on our interactive audio-social entertainment products during the period, primarily driven by our 2020 annual scale held in the fourth quarter of 2020. Additionally, podcasts, advertising, and other revenue grew by 12% year-over-year to be 5.5 million in the fourth quarter of 2020. The increase was mainly attributable to the increase in the number of advertisers. Cost of revenue was only $301.3 million in the fourth quarter of 2020 compared to only $300.8 million in the fourth quarter of 2019. The year-over-year increase was mainly due to the increase of salary and welfare benefits, payment handling costs, and bandwidth costs as the company's business grew, as well as the recognition of share-based compensation expenses. upon and after the company's initial public offering. This was partially offset by a decrease in remission fees because the incentive program for content creators, which launched in the third quarter of 2019, has been scaled down since February 2020. Growth profit was earned in $119 billion. in the fourth quarter of 2020, representing an increase of 85% for RMB 64.4 million in the fourth quarter of 2019 and an increase of 31% for RMB 9.6 million in the third quarter of 2020. Long-gap gross profit was RMB 122.6 million in the fourth quarter of 2020, representing an increase of 90% year-over-year and an increase of 33% quarter-by-quarter. Gross margin increased by 300 basis points from the third quarter of 2020, reaching 28% in the fourth quarter of 2020. Lump gap gross margin was 29% in the fourth quarter of 2020, compared to 25% in the third quarter of 2020. Operating expenses increased by 30% year-over-year and 25% quarter-over-quarter, to only 125 points formula in the fourth quarter of 2020. Research and development expenses were earned the 56.4 million in the fourth quarter of 2020 representing a year-over-year increase of 8%. The increase was mainly due to our increasing number of research and development employees as well as the share-based compensation expenses recognized upon and after our IPO in January 2020. Selling and marketing expenses were earned the 48.7 million in the fourth quarter of 2020 representing an increase of 69% from RMB 28.8 million in the first quarter of 2019. The increase was primarily due to the increase in promotion and marketing expenses related to operating and promotion activities for our product and brand name in the first quarter of 2020. General and administrative expenses were RMB 20.3 million in the first quarter of 2020, compared to RMB 15.1 million in the fourth quarter of 2019. The increase was mainly due to the increased expenses in sanitary and welfare benefits, professional services, and recognition of share-based compensation expenses upon and after our IPO. Operating loss was RMB 6.4 million in the fourth quarter of 2020, now down by 80% year-over-year and 33% quarter-per-quarter. Long-gap operating income was RMB 4.9 million in the fourth quarter of 2020, compared to long-gap operating loss of RMB 31.7 million and RMB 2.9 million in the fourth quarter of 2019 and third quarter of 2020, respectively. Land loss was RMB 5.8 million in the fourth quarter of 2020, now down by 80% year-over-year and 4% quarter-over-quarter. Long-gap land income was RMB 5.4 million compared to long-gap land loss of RMB 29 million in the fourth quarter of 2019 and long-gap land income of RMB 0.6 million in the third quarter of 2020 respectively. Basing on diluted land loss per ADS for RMB 0.13 in the fourth quarter of 2020 compared to 23.29 in the fourth quarter of 2019, and RMB 0.13 in third quarter of 2020 respectively. Long gap basis and diluted late income per ADS were at the 0.12 compared to long gap basis and diluted late loss of RMB 2.23 per ADS in the fourth quarter of 2019 and long gap basis and diluted late income per ADS of RMB 0.01 in the third quarter of 2020. The difference between gap and long gap EPS is mainly due to adjustments to the creation of prefixed share reduction venues and share-based compensation. As of December 31, 2020, we had cash-on-cash equivalents, restricted cash, as well as short-term investments of RMB 392.2 million. Overall, we achieved solid results in the fourth quarter, and we continue to be confident about growth potential of the online audio industry. With 2021 well underway, we endeavor to deliver long-term value to our shareholders. Now, this concludes all of our prepared remarks today, and we will now open the call to questions. Operator, please go ahead.
spk02: Thank you. Ladies and gentlemen, we will now begin the question and answer session. If you wish to ask a question now, please press star 1 on your telephone 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. For the sake of clarity and order, please ask one question at a time. Management will respond and then feel free to follow up with your question. Once again, ladies and gentlemen, If you wish to ask a question, please press star 1 now. Your first question comes from the line of Vicky Wei from CT. Please ask a question.
spk03: Good evening, management. Thanks for taking my questions and congratulations on the strong results. So would management provide some color about the strategic focus of Li Zhi in 2021 and also some update about the podcast monetization progress? Thank you.
spk01: Thank you, Vicky. Let me answer some of the strategic questions. In 2021, Leeds' strategic focus is still on globalization. We will further expand our ecosystem with audio as the core. Through online voice connection, we will have more companions among people. We hope that in 2021, we will allow global users to recognize our service and brand. I will take the first question. I will translate for Marco. So our strategic focus in 2021 is mainly about globalization.
spk06: and further expand our audio-centric ecosystem. We are committed to enabling people to have more companionship with each other through online audio connection, and we hope that we can make our services and brand accepted by global users in 2021. Our audio ecosystem mainly comprises three parts, which is audio-based social network, audio content portfolios, and audio communities.
spk01: In terms of voice and social media, as I mentioned before, our global product, PR, was loved by many users after it was launched last year in the U.S. Now, the social media platform in the U.S. remains relatively shallow. We are very happy to see that our digital products have achieved good results.
spk06: In terms of audio-based social networks, as mentioned earlier, our product TIA under the globalization strategy has gained wide popularity since its launch in the U.S. market last year, and it has been keeping a good ranking record among the top social networking apps until now. I'm actually very pleased that our overseeing products have gained meaningful results globally, which further reflects the trauma of the audio in the global market.
spk01: TIA is a social media product based on many scenarios. This year, we will continue to expand the diversified scenarios on TIA. We hope to transfer more audio-friendly offline social media scenarios online, TIA is a social product based on diverse scenarios.
spk06: So this year, we will continue to expand the diversified usage scenarios of Kia in order to turn more offline social things, which audio is suitable for, to online. So in the meantime, we will continue improving our product to expand user base across the globe while adopting innovative features to deepen user relationships on Kia and create a long-term and stable cost loop of user growth.
spk01: In China, in terms of audio and video content, we will use a new product called Bokeh to focus on the audio and video content. Through the collaboration with some well-known companies, we will be able to achieve our exclusive content and further expand the volume of our brand to attract users of different age groups. We hope to build a more mature Bokeh ecosystem in China in the future. For the audio content side in China, we will use our new product, V2 Podcast, to focus on premium podcast content and create inclusive content offerings through cooperation with some of the
spk06: and to further increase the exposure of our brand and attract users of different ages. We hope that in the future we can build a more mature podcast ecosystem in China in which we can help podcasters to generate income through a diversified business model and enable more companies and brands to speak out with branded podcasts.
spk01: will continue to improve the community engagement of our original DCAPP, by enriching the functions of creation, sharing, interaction, and some innovative play methods, to attract more young people to join the sound community, to show themselves through the creation of sound, to gain companionship and recognition through audio interaction. We will also continue to support the content creators, and increase the supply of UGC content, In the new year, we will continue to increase the vitality of the community.
spk06: By enhancing our function in content creation, sharing, and interaction, as well as innovative promotional content, we hope to draw more young people to join the community where they can showcase their talents through audio content creation and gain more companionship and recognition through audio interaction. We will also continue to empower content creators to enhance the high-quality UGC content offering while further establishing a virtuous community ecosystem with vibrant and highly interactive community atmosphere.
spk01: In addition to these three, we will also actively expand multi-faceted cooperation to fully leverage the advantages of audio products to further enhance user experience and reach a wider audience. Besides the three points I mentioned, we will continue to actively explore cooperation in multiple terminals.
spk06: Through taking full advantage of audio products, we are dedicated to enhance user experiences and reach a broader user base. In summary, in 2021, we will strengthen our globalization strategy and continue to develop the audio ecosystem from three perspectives, including social networking, content, and community. And this concludes Marco's answer for the first question.
spk01: Yeah.
spk05: Okay, let me take the second question about our progress on podcast monetization. In fact, I believe podcast has a broad audience base, not only abroad, but also in China. And we have noticed that users' willingness to pay for high-quality audio content is gradually increasing. Currently, on this app, we have multiple monetization models around audio content, such as fan-based membership programs, paid audio content, and advertising. Besides, according to the statistics regarding the audio content on this app, we found that the purchase rate of podcast content is at a relatively ideal level, which also makes us believe that the commercialization prospectus of podcast content are promising. As mentioned before, To expand our new user base, we launched a brand new product named Leads Podcast this January as an extension of our current content offerings. We also hope to use Leads Podcast to attract more users from different age groups and backgrounds, including white-collar workers as well as young and middle-aged users in the first- and second-tier cities. so as to break down the barriers among different user groups and build large podcast ecosystems. But at this stage, our development focus of these podcasts is mainly to explore more diversified and higher quality content, improve the penetration rate among the target users, and expand our brand influence. In the future, this podcast will have many directions to explore monetization opportunities, including subscription-based content offerings and advertising. Overall, at this stage, podcasts accounted for a relatively small proportion of our total revenue, but we found that in this quarter, the up in the audio content section increased by about 40% compared with last quarter. And we also believe that podcasts have great potential in the monetization in the future. Thank you. Thank you.
spk02: Thank you. Thank you. Our next question comes from Vincent Yu from Needham and Company. Please ask a question.
spk00: Thank you very much for the management to take my question. I have three questions. The first question is about the celebrity. and the podcast. We saw Leach has bought the celebrities as exclusive content creator for Leach podcast. Can you share with us our future strategy on exclusive content and is there any data points you can share with us on the new podcast app? My second question is about how big is the user overlap? Is there between Leach's main app and Leach's podcast app? podcast app and what is our strategy regarding requiring new users for the podcast app? My third question is for the live streaming. For the live streaming business, does the management see increase in competition from other audio-based platforms during the quarter? Any comment on the competitive landscape? Sorry, let me translate it. I have three questions. Please accept my question. These three questions are We, LiQi, have invited some artists as our exclusive content creators. Can you share with us the future of the exclusive content strategy and what data you can share with us on the new podcast app? The second question is, how big is the user overlap between LiQi's main app and the podcast app? What is our strategy to get new users for the podcast app? The third question is about the recent live broadcast. In the live broadcast, do we see any competitors from other live broadcast platforms? Do we have any opinions on the competition? Thank you. Thank you.
spk01: The first question is about the exclusive content of the live broadcast. First of all, the content of our LiZi blog is very diversified. The form of exclusive is also quite rich, including but not limited to exclusive content, and exclusive creators, exclusive blogging, this kind of way. Then on LiZi blog, it focuses more on the exclusive of the blogger group, that is, the exclusive of the blog creator. Now we are already with not only celebrities, but also famous KOLs and celebrities signed up for some exclusive content cooperation. On the other hand, we also selected a number of UTC content on the RIS app, and synchronized some of the quality blog content to RIS blog. In other words, ordinary blog creators and new blog creators can use RIS app So the first question is about the inclusive content.
spk06: So the sources of our content are diverse, and the formats of our inclusive services are extensive, including but not limited to like inclusive content, inclusive content creators, and inclusive . So with the focus on inclusive podcasters, which is podcaster creators, Lead2Podcast has signed the inclusive podcaster cooperation contract with not only with the celebrities, but also with some industry leaders and the famous KOLs in various fields. On the other hand, we also selected high-quality podcasts from the massive UGC content library of Leisure Apps and synchronized this podcast content on Leisure Podcasts. It means that when good content creators publish some premium content on Leisure Apps, then we can also synchronize this podcast content to Leisure Podcasts.
spk01: to attract individual creators to enrich our individual content. We have set up a center for creators, provide deep services for creators, and help them create through diversified activity plans. We provide a lot of support for creators. Through the recommendation and distribution of AI-powered content, In addition, we attracted inclusive content creators and released our inclusive content portfolio through various support for the content creators.
spk06: So we have built a creator center to provide in-depth services for creators and assist their content creation with diversified activities. We also offer the traffic support for our content creators and help outstanding mid- to long-tail content creators to grow rapidly on the platform through our AI-empowered content recommendation and distribution system. which enables us to further lure exclusive content creators to sign up with us and reach our content portfolio.
spk01: In general, the time limit for this blog is still short. It is still in the early stages of development. We will continue to optimize the product. I believe there will be more different types of content. I hope that in the future, we will have the opportunity
spk06: In general, VEG podcast has been launched for a short time and is still in the early stage of the development currently. We are also working on the product optimization. And I believe that in the future, there will be different kinds of content will appear, such as podcasts. And we will share more data and programs with you in the future.
spk01: ZHANG ZHANG ZHANG ZHANG ZHANG ZHANG Currently, users are able to log in to the Leeds app and Leeds blogger on these two applications. There are also a lot of useful content on the Leeds blogger that was selected from the original Leeds app. From the original Leeds app user group to Leeds blogger is also one of the main scenarios of our early accumulation of users.
spk06: So the second question is about the user overlap. Currently, users' accounts on Leach app and Leach podcast have been connected. So in the early stage, lots of high-quality content on Leach podcast is curated from the original content portfolios of Leach app. Drawing the traffic from Leach app's existing user base to Leach podcast is also one of our key ways to acquire new users at the early stage.
spk01: But why do we need to use both Lease and Leasebook? The location of Leasebook and Lease API are very different. Because the users of LeaseApp are mostly young people from small towns and young people from cities below the mountain range. And the target users of Leasebook are those who expand their circle of users and bring them to some of the most developed cities, young and middle-aged people. So while we have launched the Leach podcast, the main reason is that our positioning of the Leach podcast is quite different from Leach app. Leach app user portraits are mostly young people in small towns,
spk06: such as young people in third or below tier cities. But VG Podcast aims to expand user base by reaching young and middle age users in higher tier cities. In combination with targeting marketing campaigns and integration into multiple devices such as in-car systems, all high-quality podcast content can be accessible to more diverse user groups.
spk01: In addition, we have signed many exclusive contracts with major companies and KOLs in the industry. Through their influence, a single broadcast attracted more new users. From the point of view of content operation, we have long gained experience in the field of user listing, which has certain advantages. We have also expanded the volume in the broadcast circle, attracting a large number of broadcast enthusiasts. On the other hand,
spk06: We have signed some exclusive contracts with lots of users and KOLs and to attract new users to lead your podcast to their influences in the industry. From the perspective of content operation, I believe our experiences accumulated in the past allow us to have certain advantages in user conversion and we have also attracted a large number of podcast fans by increasing the new apps exposure in the podcast space. In the long term, we are committed to building a larger podcast ecosystem and giving the full play to the advantages of podcast applicability in multi scenarios. We hope to promote podcast as a brand new content medium and to reach a broader user base.
spk01: The third question is about the increase in live streaming. Now we can see that many new market players are entering the audio and video market from different angles. This is also due to the increase in the rate of circulation of the online audio and video. In the long run, the audio and video entertainment segment will still have a very large potential for market growth.
spk06: The third question is about the competition in the live streaming business. So now we see that in the audio, online audio space, more market players have entered into the audio entertainment sector from different angles. Along with an increase in the online audio penetration rate, I believe the audio entertainment field has great market growth potential in the long term.
spk01: Although the competition in the industry is still relatively intense, but the long-term growth of UGC's audio and video community ecosystem and the mode of live streaming are still quite different. So from the performance of the fourth quarter, our platform has a very strong competitive advantage. In terms of revenue, our income in the fourth quarter has made a significant improvement, uh, uh, uh, uh, uh, uh, uh, uh, Although the competition is fierce in the industry,
spk06: I think there is a big difference between a UGC audio community ecosystem that we have been cultivating for a long time and a pure live streaming model. Based on our performance in various aspects in the fourth quarter, our platform still has strong competitive advantages. In terms of the revenue, we achieved a substantial increase in our fourth quarter revenue which exceeding the top end of the management silence range. In terms of community operations, we further boosted user engagement on the platform through a lot of innovative promotional campaigns and our newly launched diversified operation activities in the first quarter actually attracted more users to the platform to participate and interact For example, in the fourth quarter, we launched a talk-show-style live debate program, which is quite popular in the country, and leading to a consistent production of high-quality content by connecting various hosts and ultimately attracting a large number of users to join our platform and interact.
spk01: In addition, we also combined the current hot topics with the collaboration with Nixin, and launched live broadcasts with many themes. By using live broadcasts, we can attract users to participate in the interaction. We also invited a large number of creators to participate in live broadcasts through annual events. These events not only improve the participation and activity of users, but also attract and train more content creators through innovative playing methods, and further enhance our
spk06: In addition, we also cooperated with a lot of celebrities. We have launched a number of themed live shows surrounding the trending topics through a more interactive feature such as live streaming. We have engaged more users to interact. Besides that, we have also attracted considerable amounts of content creators to join our live streaming sessions through our annual events like the Leech Voice Salon. So this activity has not only increased user engagement and active news, but also attracted and cultivated more content creators and further enhancing our competitiveness in the audio entertainment sector.
spk01: Thanks to the various benefits of our creators, the scale of our creators on the platform has continued to grow. These creators not only continue to expand the content of our UTC, but also contribute a lot of innovative interactive content to the audio and video media. This makes our audio and video set UDZ's app able to maintain a highly active and interactive atmosphere. We continue to attract more users to participate in interaction and form a positive cycle. At the same time, we are also actively enriching the governance of our audio products, expanding our audio ecosystem from social media, content, and community, and further improving our overall competitiveness.
spk06: Due to our various support for creators, we continue to increase the number of creators on our platform. So these creators not only enriched our UGC content library, but also brought in more creative and interactive content from the audio entertainment side. These withstand the highly dynamic and interactive atmosphere of our audio community on each app. and has created a positive spiral where more and more users are attracted and engaged. Meanwhile, we have been enriching our audio product portfolio, broadening our audio ecosystem from multiple aspects, including the social networking, content, and community. We want to further enhance our overall competitiveness.
spk01: Thank you. Our next question comes from Ivy Liu from Credit Suisse.
spk06: Please ask your question.
spk04: I will quickly translate myself. Could management share some updated view regarding the competition in long audio content space and how Li Jie is now positioned? Thank you. Thank you. Thank you. Thank you.
spk01: Recently, there are some new competitors in the field of long audio. In terms of audio, the long audio field mainly includes audio books and radio dramas. In fact, there are more and more players in the audio market now. We also saw that many players' main layout method is to use investment copyright to launch products such as audiobooks. This is mainly based on copyright competition. Users mainly follow the content. The loyalty to specific platforms is relatively low. So this kind of platform is also highly dependent on the content source of copyright.
spk06: Now this question about the composition, the long audio content space. So we are seeing that there are new competitors entering into the long form audio industry. Generally speaking, the long form audio sector mainly includes audiobooks and radio dramas. In fact, in the audio market, there is an increasing number of market players entering into the long-form audio sector. We have also seen that many companies participated in this sector, mainly through investing in big IPs, launching some products such as audiobooks. Thus, the sector's development primarily leads to copyright competition. Users tend to follow the content and their loyalty to the specific platform is relatively low. As a result, these platforms highly rely on various sources of copyrighted content.
spk01: Our position is that we have a certain competitive advantage in terms of digitization. In terms of audio and video, on the one hand, we have digested a lot of UGC content through Liz's app. Our positioning enables us to have competitive advantages in terms of differentiates
spk06: On the long-form audio side, through each app, we have incubated a massive UGC content library. So the content offerings are extensive, novel, and diverse on the VG app. It doesn't rely on copyrighted investments. Supported by the engaging content, users are more interactive, and creators and users can establish a solid connection between each other. our community has also further fueled the continued growth of the content creation.
spk01: In this respect, we have developed UGC content words and collaborated with some of the leading companies in the industry to create exclusive bloggers. We believe that the future of the blogging market is relatively broad. It's not the same as the digital payment. There are not many copyright acquisition issues. It's very easy and interesting. It focuses on the expression of ideas. In the US and other countries, it's very mature.
spk06: 我们相信播客在中国还有很大的发展的潜力。 On the other hand, we have further differentiated our content offerings based on our massive UGC audio content portfolios and the inclusive podcasts produced in collaboration with some industry leaders and industry elites and celebrities. We believe that the podcast market We all have a bright future, unlike the audiobooks or paid-for-knowledge platforms. Podcast doesn't have the copyright problem, doesn't rely on the copyright, and podcasts are less interesting and focus more on the opinion impression. In fact, the podcast market has already been relatively more mature, like the United States and other overseas markets. We believe that it still has great development potential in China.
spk01: In addition, we pay great attention to the versatility of the podcast audio format. As mentioned earlier, with the rapid development of 5G and IoT, We hope to make use of the unique content of the blogger in the future. to expand the size of our users.
spk06: In addition, we highly appreciate the applicability of Podcast on multiple devices or terminals. As mentioned earlier, along with the rapid development of 5G and IoT, Podcast can be used in multiple scenarios, such as smart wearable devices, smart home devices, and in-house scenarios. The demand for Podcast is actually growing. Through cooperation with many leading automobile companies, We hope to make the distinctive forecast content accessible on more devices and terminals and further expand our user base.
spk01: Thank you.
spk06: This concludes our answer for the question. Thank you.
spk02: Thank you. And that's all the time we have for questions today. I'll turn the call back to the company for closing remarks.
spk06: Thank you once again for joining us today. If you have further questions, please feel free to contact Li Zhi's investor relations through the contact information provided on our website at ir.liji.fm or the Bianche Group investor relations. Thank you.
spk02: Thank you. This concludes the conference call. You may now disconnect your line.
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