Tuniu Corporation

Hello, and thank you for standing by for 2NEWS 2022 Second Quarter 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 is being recorded. If you have any objections, you may disconnect at this time. I would now like to turn the meeting over to your host for today's conference call, Director of Investor Relations, Mary.

Thank you, Operator. and welcome to our 2022 Second Quarter Earnings Conference Call. Joining me on the call today are Donald Yu, CUNY's founder, chairman, and chief executive officer, and Anqiang Chen, CUNY's financial controller. For today's agenda, management will discuss business updates, operation highlights, and financial performance for the second quarter of 2022. Before we continue, I refer you to our safe harbor statement in the earnings press release, which applies to this call, as we will make forward-looking statements. Also, this call includes discussions of certain non-GAAP financial measures. Please refer to our earnings release, which contains a reconciliation of non-GAAP measures to most directly comparable GAAP measures. Finally, please note that, unless otherwise stated, All figures mentioned during this conference call are in RMB. I would now like to turn the call over to our founder, chairman, and chief executive officer, Donald Yu.

Thank you, Mary. Good day, everyone. Welcome to our second quarter 2022 earnings conference call. During the second quarter, while in April and May tourism was impacted by most severe resurgence of COVID-19 since the initial breakout in 2020. In June, we saw a rapid recovery as outbreaks were better controlled. The industry also benefited from favorable policies such as more relaxed travel restrictions. The enthusiasm for travel among the public remains high with demand increasing since the first half of the year. To news, total travel GMV growth exceeded 100% month-over-month during June and July despite the setback in the second quarter. With peak travel season starting in July, booking volume for several popular destinations increased significantly. with two new booking volumes doubling in July compared to the previous month. By keeping our focus on providing high-quality products and services during times of external challenges, we are able to weather industry downturns and recover quickly during the rebounds. In terms of our product new tool, our self-operated product, continues to offer a high level of standard services to meet diverse customer demands. Since it was first launched over a decade ago, New Tools' production ecosystem has developed its own operating process and standards for product design, resource selection, customer service, and evaluation. New Tools' high-quality products are the key to our high customer retention rate, with the contribution of our repeat customers to overall GMV remaining at over 70% since the pandemic broke out. Leveraging 2NEWS high-quality products and reputation, we aim to develop more popular products to meet the high market demand during the peak seasons. Taking one of our new tool products designed for Xinjiang as an example, we increased the number of the tool groups to meet the high demand in July, with the sales of the product exceeding RMB 3 million in a single month. In terms of product innovation, during the second quarter, we continued to explore village tool products as customer demand continues to become more diversified. In addition to traditional tools, The experiential tours have become more popular and help to provide opportunities for the high-quality development of village tourism and boutique B&Bs. SUNY also collaborates with several village tourism projects on operation and management in addition to their product development and promotion by leveraging our advantages and strengths in the industrial chain. To news, self-operated B&B in Tianjin has been experiencing an increase in occupancy since it was opened in May last year, with revenue growth of over 200% year-on-year in both June and July of this year. We will continue to explore rural tourism and B&Bs with an asset-like model in order to support the revitalization and development of the local tourism industry and enrich 2NEWS product offerings for our guests. Live streaming shows are becoming more and more prevalent in customers' daily lives and are now a key channel for 2NEWS sales, promotions, and customer acquisitions. 2NEW features different types of live streaming shows focused on product sales and the introduction of various destinations, as well as recommendations for destination-based activities and products such as camping equipment. As a company with deep experience in tourism, 2NEW has clear advantages in producing tourism-related live streaming shows. In April, we launched a live streaming show on Douyin, and the show ranked as the top hotel and travel live streaming show in eastern China in May and June, with the total GMV of the live streaming show exceeding RMB 8 million in June. As one of our core competencies to new, is committed to focusing on customer demand and providing high-quality service despite changes to the external environment. Under the current COVID-19 control measures, Tuneo launched additional services including free refunds up to 24 hours before departure day and nucleic aid testing in some of our organized tool products. Our guests can get a full refund for local tour operator services up to 24 hours before their departure date, which provides a worry-free guarantee. Nuclear aid testing services are offered to the guests throughout the tour at their destination, with assistance from our staff to provide a better travel experience for the guests. Our customer service team and local staff at destinations aim to provide a full-cycle service network to ensure that our guests enjoy their trip. In terms of technology, we continue to improve efficiency and quality through digitalization as we optimize our internal operations and external customer experience. For internal operations, we have further automated our inventory management and product launching processes, as well as display and maintenance to reduce labor costs. In terms of enhancing customer experience, we are leveraging AI technology to replace some of the simple manual customer service tasks such as the reception of guests on their first visit, as well as recommendations for products and live streaming shows, further reducing the burden on manual customer service and improving the response speed for customer service requests. Guests who purchase our advanced booking products can complete their order confirmation online which is both faster and more convenient. 2NEW will continue to provide technical support to internal departments including our product and customer service teams to further improve their efficiency and quality of their daily work. In conclusion, despite recent pandemic outbreak, domestic tourism is set to continue to benefit from positive policies and increasing travel demand. and we remain optimistic for the long-term development of the industry. In order to consolidate and expand our customer base and create greater value for our customers, we will remain committed to developing high-quality products and services while we see the momentum of the industry rebound to sell more gas. I will now turn the call over to Anqiang Chen, our financial controller, for the financial highlights.