HUYA Inc.

Hello, ladies and gentlemen. Thank you for standing by for the 2020 Second Quarter Earnings Conference Call for Huya Incorporated. 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 Chang, Company Investor Relations. Please go ahead.

Hello, everyone, and welcome to Huya's 2020 Second Quarter Earnings Conference Call. 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. Katherine Liu, Chief Financial Officer. Management will begin with prepared remarks and the call will conclude with a Q&A session. Before we continue, please note that this discussion will contain forward-looking statements under the safe harbor provisions of the U.S. Private Securities 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 filings as filed with the US 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. HUYA's press release contains the 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. HUYA has achieved outstanding results across our core businesses in the second quarter of 2020. Our total net revenues grew 34% year-over-year to RMB 2.7 billion, continuously exceeding our previous expectations. Our gross profit grew 71% year-over-year to RMB 575 million, further demonstrating our faster growth and improved profitability. With respect to the user traffic, despite the fact that people in China have largely resumed their daily work and school schedules, we maintained the momentum that we built during the pandemic period in Q1 on the mobile end. We accomplished year-over-year growth of 35% for the mobile MAUs of Huya Life, reaching 75.6 million in Q2. As China's commutes and people's activities move toward normalcy, Many offline internet cafes have also reopened, supporting the rebound of our non-mobile emails in Q2. As a result, the average emails of Huya live increased by 17% year-over-year to 168.5 million in the second quarter. representing a net addition of over 17 million from Q1. The growth was primarily driven by our dedication to continuously enriching our content offerings while further improving the content quality. Next, I would like to share with you some updates about the preliminary cooperation that we have started with Tencent since Tencent became our controlling shareholder in April. Whereas live streaming content is now available within an increasing number of Tencent games and products, which will help us tap into an extended pool of users. Users who watched our live streaming content within Tencent Games and products such as WeGame, WeChat Game Center, and QQ Mobile Game Center were not counted in Huya Live's MAUs. In addition to our Huya Live's MAUs, average MAUs who watched Huya Live's streaming content found these external linkers within Tencent games and the products increased by 16% in Q2 from Q1. We are also in the process of building exclusive one-click streaming services within some of Tencent games to attract more broadcasters. With the new service, Tencent gamers can see new tenuously stream their gaming experience through the click of a button and essentially became our broadcasters. In terms of the esports tournaments, we are also working together with Tencent in various dimensions, such as cooperation in esports tournament content, traffic exposure for live streaming content, advertising, of opportunities, as well as innovative products to improve users' viewing experience of the esports tournament. Finally, but importantly, we have always been trying to stay nimble to meet the ever-growing demands of users while continuously developing and expanding our product. offerings for long-term growth. Most recently, in June, we launched our cloud gaming platform called Yova, offering over 40 game titles. The platform made easier access for a broader audience to enjoy the fun of games. And our long-term prospect for Yova is to enable our users to play together with our broadcasters and enjoy unique, interactive, fun experiences. We have also strengthened our efforts for videos mainly focused on mid-length game videos. In the second quarter, average MLs who watch the videos on our platform increased by 60% year-over-year to approximately $20 million. Our business is more diversified, and all of these efforts will help us seize future opportunities and emerge in an even stronger position in the game live streaming market. With that, I will now turn the call over to our CFO, Catherine. to share her insights on our operating metrics and the financial details. Catherine, please go ahead.