Jianpu Technology Inc.

Good day, and welcome to the GenPool Technology first quarter 2022 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on a touch-tone phone. To withdraw your question, please press star then two. Please note, today's event is being recorded. I would now like to turn the conference over to Colin Chong. Please go ahead, sir.

Thank you, operator. Hello, everyone, and thank you for joining us today. Our first quarter 2022 earnings release were distributed earlier today and is available on our IR website at ir.genpool.ai, as well as on PR News Live services. On the call today from JEMFA Technology, we have Mr. David Yeh, Co-Founder, Chairman, and Chief Executive Officer, and Mr. Oscar Chen, Chief Financial Officer. Mr. Yeh will talk about our operations and company highlights, followed by Mr. Chen, who will discuss the financials and guidance. They will all be available to answer your questions during the Q&A session that follows. Before we begin, I'd like to remind you that this conference call contains forward-looking statements as defined in Section 21E of the Securities Exchange Act of 1934 and the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management's current expectations and current market and operating conditions. and relate to events that involve known or unknown risks, uncertainties, and other factors, all of which are difficult to predict and many of which are beyond the company's control. These risks may cause the company's actual results or performance to differ materially. Further information regarding these and other risks, uncertainties, or factors is included in the company's filings with the USFCC. The company does not undertake any obligation to update any forward-looking statements as a result of new information, future events, or otherwise, except as required under applicable law. Finally, please note that unless otherwise stated, all figures mentioned during the conference call are in Roman B. It is now my pleasure to introduce our co-founder chairman and chief executive officer, Mr. David Yeh. David, please go ahead.

Thank you, Colin. Hello everyone, and thank you for all you for joining us today. During the first quarter, despite the challenging macro environment and the resurgence of COVID in several areas of China, we delivered another strong quarter of growth with the total revenue up 43% year over year. The results were primarily driven by our persistence in pushing forth on our vision to become everyone's financial partner and empowering users and enabling the digital transformation of financial service providers through tech knowledge and product innovation. I will start by going through the key highlights for the first quarter, then share some observations around the current macro and COVID environment and its potential impact on our business. Before turning it over to Oscar to go through the financial performance. First, we ended the quarter with a more diversified and balanced revenue structure, thanks to the growing revenue contribution from our new initiatives. In the first quarter, our revenue continued its growth momentum with a more diversified structure we have 22% revenue from our loan recommendation services, 47% revenue from credit card recommendation services, 10% from data-driven and system-based risk management services, and 21% from advertising marketing services and other services, versus 19%, 54%, 18%, and 9% in the corresponding quarter of 2021, and 21%, 51%, 16%, and 12% in full year 2021. Among the revenue streams, our recommendation business continued to gain market share, with revenue increasing 36% year over year. During the first quarter, we sustained our industry-leading position in the credit card recommendation business we maintained solid relationship with the majority of owner and credit card issuing banks in China. We continue to be the top owner acquisition channel to many of these key banks. As for our new businesses, we have accelerated the deployment of our omni-channel marketing solutions through adjacent category with a large data-rich user base and a great financial need. resulting in significant revenue growth. The revenue for advertising marketing services was 2.5x year-over-year. The growth momentum is further proof of our success by extending our social media and partner programs into non-financial service categories. Second, alongside the recovery of the business, economies of scale kicked in is a clear trend of improvement in efficiency. Anticipating the uncertainties and challenges arising from the macro environment and the regulatory change, we have strived to achieve a balance between growth and efficiency. Our social media and partner program has played an increasingly important role in delivering both growth and efficiency. The ROI or revenue divided by the corresponding cost of acquisition and promotion of a recommendation business improved two percentage points year-over-year and 10 percentage points subsequently. We have also seen a promising trend of the new businesses delivering over 10 percent points ROI improvement quarter-over-quarter. While the scale continued to grow at 103% on the same basis. Third, we have further enhanced our capabilities to enable the digital transformation of the financial industry and other industries. We have seen an increasing demand from financial institutions to acquire, identify, and engage their users across different channels to provide better service and improve users' lifetime value. Our omnichannel marketing solution is well positioned to capture this increasing demand. As an independent third-party open platform, we have already aggregated user acquisition sources from online and mobile media, as well as our proprietary social media and partner programs. We recently started to explore different user acquisition channels through various consumer consumption scenarios, such as travel, e-commerce, lifestyle, et cetera. We believe that such channel expansion and integration will allow us to diversify our user base and further strengthen our omnichannel solutions to enhance the acquisition capability of financial institutions. In addition, The banks have also been increasingly focused on improved user retention and customer loyalty post-acquisition. This brings plenty of business opportunities for us as we explore ways to enhance the operations through our cutting-edge technology and product operational experiences. We have deepened our collaborative relations with existing banks in our partnership network, launching initiatives such as digital promotion activities to improve customer engagement and the cross-sell of different financial products and services, using our suite of digital transformation solutions to help financial institutions improve efficiency and reduce costs. The breakthrough that we have recently done was the establishment of a strategic cooperation with a large telecom to jointly develop a suite of tech solutions and services to target the digital transformation of financial institutions, local or government authorities, and other enterprises. The phase one of corporation will provide supply chain management system and related financial services to small and medium-sized enterprises. We have also been building our pipeline of such strategic corporations, including with the internet platform and the cloud service companies. Finally, we remained very disciplined in executing our cost optimization measures and initiatives, resulting in further optimization of our cost structure and the productivity optimization of our businesses. Our operating losses decreased by 19% year over year, and the non-GAAP adjusted net loss margin further improved by 10% points compared with the same period in 2021. Over the coming quarters, we will remain disciplined. We will maintain the disciplined approach to continuously optimize, and it will be more nimble and agile in our operation. I will now take a few minutes to talk about the latest COVID situation in China and the latest macro environment and regulatory dynamics, as this issue appears to be the top of many investors' minds. With regard to the COVID situation, the resurgence of COVID, which resulted in the multi-city lockdowns that started in March, has impacted consumer confidence and led to a slowdown in the economy. I think there are several moving pieces. On one hand, under the current COVID zero policy, it is expected there will be a continuation of a rolling lockdown across the country. Furthermore, despite the subsequent easing of lockdown in places such as Shanghai and Beijing, our previous experience would tell us that it usually takes some time before business ramps up to its prior level. But on the other hand, as many financial institutions have already begun moving toward digital transformation and using digital operations in the face of COVID. The absolute impact might be smaller. Even some financial institutions can continue their customer acquisition operation through online channels. Hence, I think the overall effect of COVID is relatively short-term and manageable. In terms of our own business, given the face-to-face nature of some of our businesses, we have also sustained some impact due to COVID. Nevertheless, we continue to maintain relationships with our financial institution partners and the regulatory authorities. Given the ongoing trend for digital transformation, we believe once the lockdown is we can continue to cultivate our pipeline for further projects and initiatives. On the macro environment and regulatory front, we continue to be encouraged by recent public comments from regulators and remain optimistic about the future development of the digital economy and the opportunities it brings to us. As many of you know, Since the beginning of the year, the Chinese government has issued statements and policy guidance in support of the digital economy and the platform economy from the very top level. We also have seen policy guidance coming from the China Banking and Insurance Regulatory Commission to support the digital transformation of banking and the insurance industry. With these latest notices, focusing on the importance of tech empowerment for banks to carry out process innovation and business improvement in terms of their capability in response to customers' needs, especially during times where many businesses are affected by the pandemic. In addition, there is a rising focus on supporting 300-plus million potential new urban residents These new residents typically have higher needs and urgent needs for financial product and services, but they don't have the prerequisite documents and credentials to obtain and apply for financial products or receive services from financial institutions. This creates an additional driver for digital transformation as financial institutions seek customized and smarter digital solutions and new risk profiling capability and tools to help these new urban residents to meet their massive financial needs. And lastly, we are beginning to see signs of liquidity being injected into the financial system with the banks receiving guidance from the government to increase their loan balance and the portfolio. We believe the government's measure and initiative will support economy growth and it will bring an increasing digital transformation trend for financial service providers. We will continue our efforts to empower financial institutions' digital transformation and to support the development of China's digital economy. Despite the ongoing uncertainty around COVID-related lockdowns, we remain very confident in the long-term prospects of the sector and the overall industry. We believe the groundwork we have laid and our investments in digital transformation solutions and tools will ultimately deliver greater value to the company and our shareholders and other stakeholders. Lastly, I would like to take this opportunity to announce a change to our leadership team. Mr. Jia Yan Lu will no longer take his current role as chief operating officer of the company from July 1st, 2022. He will continue to serve as director and we will also retain Jia Yan as an advisor until early next year. On behalf of the board and the management team, I would like to express our gratitude to Jia Yan for his dedication and contribution to the company in the past decade. We believe that we will continue to benefit from Jia Yan's expertise and experience as a director and advisor of the company. I will now turn the call over to our CFO, Oscar Chen, who will discuss our financial results. Thank you.