VNET Group, Inc.

Hello, ladies and gentlemen. Thank you for standing by for the third quarter 2023 Earnings Conference Call for VNet Group, Inc. At this time, all participants are in listen-only mode. After management's prepared remarks, there will be a question and answer session. Participants from our management include Mr. Jeff Doe, Chief Executive Officer, Mr. T. Yu Wang, Chief Financial Officer, Mr. Tim Chen, Chief Strategy Officer, and Ms. Xin Yuan Liu, Investor Relations Director of the company. Please note that today's conference call is being recorded. I'd now like to turn the call over to the first speaker today, Ms. Xin Yuan Liu. Please go ahead.

Thank you, operator. Hello, everyone, and welcome to our third quarter 2023 earnings conference call. Our earnings release was distributed earlier today, and you can find a copy on our website as well as on Newswire services. Please note that today's call will contain forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from our current expectations. For detailed discussions of these risks and uncertainties, please refer to our latest annual report and other documents filed with the SEC. VNAT does not undertake any obligations to update any forward-looking statements, except as required under applicable laws. Please also note that VNAT's earnings facilities and this conference call include the disclosure of an audited GAAP and non-GAAP financial matters. Earnings Press Release contains a reconciliation of the Unaudited Net Gap Matters to the Unaudited Gap Matters. As a reminder, this conference is being recorded. In addition, webcast of this conference call will also be available on our IR website, sir.vinet.com. I will now turn the call over to our CEO, Jeff.

Thank you, Hien-Yuen. Good morning and good evening, everyone. Thank you for joining our call today. I'd like to start with the overview of our third quarter performance. Our solid growth in the third quarter reflects our continued focus on high-quality business opportunities. Cabinet deliveries are progressing smoothly. By the end of the quarter, we had grown our total cabinets under management to approximately 88,900, compared with approximately 82,660 years ago. The number of utilized cabinets increased by 1,092 to 52,408. in the third quarter, turning our overall utilization rate to 59%. Furthermore, our retail MRR per capita during the quarter stayed high at RMB 9,495. We remain dedicated to ending high-quality revenues in both the wholesale and the retail EDC markets in the third quarter, generating solid year-over-year growth with our total net revenues increasing by 4% to RMB $1.89 billion and just EBITDA growing by 11.6% to RMB 507.9 million. With a rapid pace of large language model training and AI application deployments, computing power is becoming a new productive force to meet the growing need for computing power. China's governing authorities have recently unveiled an action plan for the high quality development of computing power infrastructure nationwide. As an industry leading player, we are seeing increasing demand for premium ITC services, and we remain a clear choice for customers to ride the wave of digital transformation. Now let's take a closer look at our third quarter business updates. First, AI is driving increasing demand for computing power and ITC services. Our wholesale data center continues to meet the increasing AI demand. driven by our customers' growing business. Equipped with high power density capabilities, we excel in powering large language model training and deployment for internet platforms. Our core competencies, spending resources, and execution capabilities enable us to support our customers' evolving and sustained business development needs. As we mentioned on our last call, in August, we won an extended order of 45 megawatt from the UCT Internet giant customer, which speaks to our superior wholesale service offerings appeal amid the competitive landscape. Moreover, our company deployment execution has been stellar. During the third quarter, we successfully delivered over 2,600 high-power density cabinets in the Yangtze River Delta region to one wholesale customer and approximately 800 high-power density cabinets in the northern region of China to another wholesale customer. Throughout the delivery process, we maintained strict quality standards while offering customization options tailored to customer requirements. This execution is a testament to our commitment to timely delivery and top-notch quality, which has earned us a reputation for reliability and customer satisfaction. Our retail customers' AI-driven demand continues to rise, particularly from existing customers in industries such as local services, healthcare, and VR. Building on this momentum, we expect to attract more retail customers from a wider range of industries. such as autonomous driving and AI solutions. I'd also like to highlight our distinctive proficiency in designing and implementing power and equipment upgrades for our cabinets to meet existing customers' high power density computing needs. This capability is well supported by our engineering experience and expertise, as well as our existing high power density cabinets. which allows us to promptly address growing diverse AI demands from retail customers. In addition, we further expanded and diversify our retail customer base in the third quarter, attracting new customers and securing extended contracts from an existing customer in various industries, including IoT, financial services, gaming, and mobility. It's also worth noting We recently won a new order of 1.5 megawatt from an existing customer award-leading consumer electronic tech brand. Now turning to our value-added services. During the third quarter, our full-stack one-stop biometal as a service solution continued to gain new customers, one of which is a pioneering unicorn in the VR industry. We won the contract based on our flexible computing power resources that can rapidly meet these customers' specific demands during peak business hours, underpinning the rapid growth of its metaverse business. Our diverse IDC services offerings include a solid IT infrastructure, premium operations, and maintenance services, and impressive cost-efficient solutions, making VNet an outstanding choice for potential customers looking for a trusted partner to support their current and future business development needs. We have also attracted a leading Chinese EV automaker for our interconnectivity services, throughout our robust data center and network resources nationwide. The customer can store their business data in adjacent data centers and transmit with low latency backhaul. This customer reaffirms our compelling value proposition and advanced interconnectivity services capabilities. In summary, our robust third quarter results showcase our ability to effectively address both wholesale and retail business IDC needs backed by timely and strong execution. Looking ahead, AI prevalence and adoption is emerging across industries and supportive government policies will accelerate the development of computing power infrastructure in China. As a dedicated industry leader, we look forward to meeting this newest wave of demand driven by AI applications and further unleashing our long-term growth potential. Thank you, everyone. I will now turn the call to Qi Yu to discuss our financial performance for this quarter.