HUYA Inc.

Ladies and gentlemen, thank you for standing by for the 2020 First Quarter Earnings Conference Call for Huya Inc. At this time, all participants are in a listen-only mode. Today's conference call is being recorded. I will now turn the call over to Ms. Dana Cheng, Company Investor Relations. Please go ahead.

Hello, everyone, and welcome to Huya's 2020 First Quarter Earnings Conference. The company's financial and operational results were issued earlier today and are posted online. You can also view the earnings press release by visiting the IR website at ir.huya.com. A replay of the call will be available on the IR website in a few hours. Participants on today's call will be Mr. Rongjie Dong, Chief Executive Officer of Huya, and Ms. Catherine Liu, Chief Financial Officer. Management will begin with prepared remarks and the call will conclude within a Q&A session. 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 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 followings as followed by the U.S. SEC. The company does not assume any obligation to update any forward-looking statements except as required under applicable laws. Please also note that we ask earnings press release and this conference call include discussions of unaudited GAAP financial information as well as unaudited non-GAAP financial measures. We ask press release contains a reconciliation of the unaudited non-GAAP measures to the unaudited most directly comparable GAAP measures. I will now turn the call over to our CEO, Mr. Rongjie Dong. Please go ahead.

Hello, everyone. Thank you for joining our conference call today. Since the beginning of this year, COVID-19 has caused a lot of uncertainties worldwide. We remain hopeful and dedicated to helping people stay connected and providing them with rich online and payment content during this critical time. Despite the macro environment challenges brought on by the pandemic, Q1 was another solid quarter for us. We saw accelerated growth of mobile users in the first quarter, which further strengthened our leadership position and increased our market share. Average mobile MLs of Huya Life grew 39% year-over-year, reaching $74.7 million, exceeding our previous target and hitting an all-time high. We had over 13 million net additions to our mobile users from Q4. Selected growth was mainly driven by the rich content on our platform and our comprehensive and self-reinforcing ecosystem, as well as the lockdown periods and extended school holidays during the pandemic. coronavirus outbreak. Due to the closure of offline internet cafes during the coronavirus outbreak, our non-mobile users were negatively impacted. However, our total users still continued to grow. Average emails of who we are live Q1 increased 32% year-over-year, reaching 151.3 million, representing over 1 million net additions from Q4. While our user community experienced fast expansion, we were still able to achieve a high level of user retention and engagement. The next month The user retention rate for our Huya Life app remained over 70%, and the daily time spent by users on Huya Life app increased to over 107 minutes from 100 minutes in previous quarters, driven mainly by the accelerated growth of mobile users. our Q1 revenues grew 48% year-over-year, reaching IMB 2.4 billion. Our revenue growth was accompanied by margin improvement, again demonstrating our solid execution capabilities. Here, I would like to share another important update with you. As we previously announced in April, Tencent exercised its option to acquire 16.5 million CACI ordinary shares of Huya for U.S. $262.6 million in cash from JYY. The transaction made Tencent the largest shareholder of Huya, increasing its voting power in Huya to 58.1% on a fully diluted basis. Since the transaction took place, we have been strengthening our collaboration with Tencent, working closely across various areas such as games, esports, and AI technology. For example, we are developing new features, products, and services to help us step into Tencent's massive user community. We are also cooperating with Tencent to better serve our users and broadcasters, as well as Tencent users. In addition, Tencent and Huya will be jointly exploring new business models and business opportunities across the gaming and esports world chain. With Tencent's strong support and the massive user community, we believe we are well positioned to strengthen our leadership in China's game live streaming industry. We see this cooperation as a start of our new journey for Huya, and we look forward to being an active participant in a dynamic and growing market, as well as contracting more driven forces of game live streaming within the ecosystem of Tencent. With that, I will now turn the call over to our CFO, Catherine, to share her insights on the operating metrics and the financial details. Catherine, please go ahead.