XNET - Earnings call transcript Q2 2022

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Operator

Welcome, ladies and gentlemen, and thank you for your patience.

You've joined Xunlei's 2022 Second Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. Please be advised that today's conference is being recorded. I would now like to turn the call over to the host, Investor Relations Manager, Ms. Tang. Luhan

Luhan Tang

good quarter thank earnings and Xunlei's for everyone, second XXXX conference morning, you, you and joining Thank call.

of Hu], On are the Vice [Lee Eric today President Senior Zhou, Chief call Financial Officer; with Finance. me and

Now you release IR call. prepared which website our earnings intended supplement during on to our is remarks find can our press today's

Mr. Li, the our opening guidance Eric Today's of from quarter We'd remarks. Chairman and our from today's I agenda, website. Relations with by second up will wrap CFO, will our For our of financial any after our Mr. Zhou, quarter you the call first XXXX. is and on Investor Jinbo go remarks to questions call operations. details of read welcome Then our prepared revenue the highlights replay CEO, for through recorded, management's third and the like can you results

like that numbers stated. assume On be release. description statements. SEC to this Xunlei unless dollars for to risk obligations you the statements of today this detailed started, Private and under that of any Before found Please take opportunity are Act to Securities get the Litigation under made contain applicable comparable remind to of will harbor can factors as Reform safe in I non-GAAP the we XXXX. provisions U.S. discussion our measures the certain would of affect that we forward-looking forward-looking uncertainties financial results Such more are all which those current call, based on and will U.S. note required measures. non-GAAP our law. to forward-looking GAAP on to results. no market refer difficult made that to actual a press differ are the are materially be to statements, in may in risks update Please may expectations cause earnings conditions reconciliation predict, using our subject statements filings except current management's GAAP that both otherwise from A

the Limited. is the statement by prepared of Li, Xunlei Mr. following Jinbo CEO Now Chairman and

Jinbo Li

thanks report that we us Good XXXX. business I'm delivered quarter second of of everyone, results joining the our very and lines today. in morning, for expected achieved quarterly most performance as good pleased to

the share into step you of I'd our the get quarter, in like quarter. I to of back results the with Before business the second and highlights

off quarter. second high-growth We consecutive for result to profit industry. services. so, with and government very COVID-XX, to demand to increase ability subscribers cater our, quarter Our the did XXXX, record a U.S. exciting that level decrease premium our this profitable evolving products five subscription the operations to Those cloud as subscribers, against the pleased several I'm to currency to and proud in XX.X% et job net quarter, encouraged to XX% and million, to our top of devaluation impact we of $XX.X total the But computing our it business dollar I'm awards grew our a for attributable was cetera. in that quarter total challenging after second campaign quarters. growth our innovation RMB our about of down need realized reached of led environment conversion. reached and in that slight contribution slowing dollar, efforts business subsidiary begin this regulations, our I'm a that due as is opportunities. marketing users' reported streaming to the quarter, live Also, consecutive the the great exhibited of spite growth. pursue our in a In seventh the revenues last U.S. increased of Despite received million quarterly and services And for revenue of efforts quarter well previous X% economy, from $X our to in and pay our enhance inspiring total macro consecutive optimize line reached which are results second a a industry that achieved effective dealing

the computing Award I was cloud top mentioned Conference [Shangshi business the in As maintained XX computing Cloud our Cloud to its earlier, other competitiveness the Connect XXXX XXXX Among market. June. and Computing May in edge Leading company in as nominated China recognition, Longchuang] Brand received and

our business. I'm our stable quarter. change cloud and also total our XXXX into relatively from of declined on the momentum, By primarily in more quarter, X.X% services live user-friendly upgraded our $XX.X first in our loyalty to computing In building streaming our premium increase growth progress grew to continued revenue scalable last seen previous the as the RMBXX.X and opted of competition bandwidth will second these the X.XX X.XX an for features second are XXXX audio translated came revenue, the are streaming million U.S. the average of second and clients determined increase and down computing become the the A million in With improve revenues which the XXXX, revenue their from witness quarter, the second quarter. future. quarter, member XXX.X% launching XXXX. streaming the on second we've negatively of product to was Internet in from deliver we quarter pressure presence inspiring X.X% dollars. from second services of our in overseas of to we choice quarter an and which increase value-added intense researching to in rates computing other due new $XX.X number exchange from Since but to versus and to our the continue in previous to engaging proactively the to pricing of revenue that in in service cope markets. grow. subscriber X.X%, was revenue, affected subscription And the quarter. was we're quarter, different with million Even encouraged CDN that sold though generated growth that in diversified from our RMBXX.X said, accomplishments, live business markets. We're revenue regions The brand our to products per applications more large we and customers. in as cost-effective provider subscribers per users' industry and average versus quarter grew services of realized million reliable, subscriber services the That recognition believe the the edge when in compared the will quarter an more community, sudden more products first services expect live continuous live added the and services. business, portion foreign of members cloud as for for the developing of our existing expanding our In streaming

Internet desired museums our other results affected of and advertising collectibles quarter, hand, performance. our a produced and digital platform owners identified delivered negatively the and other uniquely service which however, less our ThunderChain. Last art blockchain technology overall the of collectible with IP institutions, number digital than On collaborated using were

and to both and continue collectible been future, of create platform expand endeavor far, by In product the employees' In to contribution Although business its and it our revenue strictly blockchain digital the contribution has categories grateful significant will our is our diverse collectibles. team. and a relevant continue laws conclusion, with We Meanwhile, to to for new great very so development. we'll dedication collectible of portfolio comply regulations. a potential small believe risks. is this our I'm digital total service

capabilities XXXX. will we to half into will year and positive enjoyed like optimistic in optimize our I'm our line growth. the half now to results forward, operations and cover Eric Chief of first to call innovative on Eric the profitability. this strategy continue conclusion, revenue core outlook. continue Looking that, say our you. of over the sources continue our in our Officer. enhance that our be cultivate Over, the In also and of to our Thank diversify second to we leveraging new financial competitive share Zhou, turning of momentum that Financial we'll accelerate we're Mr. With detail I'd to edge focused to will top

Eric Zhou

revenue U.S. XXXX again conference and representing now was wrap revenues details million, I our $XX.X a other Xunlei's dollars, U.S. partially quarter. up from and streaming live million of call. increased denominated previous our dollar will was against results financial you revenues with Luhan. revenues mainly our quarter. quarter guidance decrease of cloud The Thank $XX.X were the a from were decrease of computing of for joining and RMB the thank IVAS Hello, the revenues decrease due exchange total the in services. devaluation earnings RMB rates of previous cloud you, X% offset against everyone, through our of X.X% revenues quarter from computing cloud XXXX. Total go of for Revenues were to RMB. to computing of the second as decrease devaluation in from representing by third mainly The attributable

and quarter. XX.X% million profit in with million our total RMBXX.X of premium expenses above. our was streaming per in increase payment. was was period quarter. representing the IVAS with The accrued decrease our of subscriber second million was of quarter of our quarter improved for in the $XX.X due margin expenses compared previous larger of audio foreign the with from the launched compared The an of million, for income quarter with led expenses were mindful granted for compared $X second of million, The second this more previous sold of margin which and stable quarter revenue of expenses revenues for Gross with of streaming second The total was million and compensation was gross were other the The million profit due income was the management, other were Revenues Sales and compared mainly primarily was development subscription Non-GAAP from previous audio X.XX increases second second other new during increase units higher Historically, previous to payment share-based the profit revenues in with from quarter. for opting The the XX.X% significantly. non-GAAP as approximately $X.XX and income revenue, quarter. users as representing in primarily profit compared or X.X% X.XX discussed as and second quarter. compared million, we to low previous due quarter from during During with of Other competition. of $X.X payables sometimes $X.X the IVAS revenue to average live total other operating quarter and senior million, in representing primarily compared subscribers quarter. General bandwidth vesting XXXX quarter. previous second by demand million was streaming previous operating-related $X.X revenues total XXXX. a to marketing IVAS which million, to live XX.X% from certain $X than total live of live probability were quarter. million the million $XX decrease our by was $XX.X the we membership previous exchange and increase revenues of million an gains the in handling stock-based was subscriptions Net in Operating and to of number Research XX.X% previous in gross practically our $XX $X.X or our percentage revenue the other compared representing quarter the due in and which period due the XX.X% quarter. industry Gross June in were live income for $X.X service are streaming the reversal were quarter. increase other the the the average revenues years second decrease expenses to XXXX. offset option. for million, compared for subscriber with increase representing of quarter. previous and number from fees increase quarter RMBXX.X income of discussed fluctuated the compensation XX, the increased margin restricted of March X.X% Revenues total the quarter. in increased first of and of previous compared streaming million was gross the Diluted enhanced of X.X% $XX.X the of in million net quarter, million in with quarter $XX.X the per products, of representing administrative was the in The or increased mainly previous our to increase products. a partially of $X.X was XX, with XXXX $X.X X.X% was X.X% revenues million earnings $X.X of net driven increase the The due XXXX. costs, ADS income due net compared to the above. quarter. with income in was income XXXX to in due $X quarter in our share second as $X.XX revenues the the as income primarily was per The the the and to our three XX.X% our

XXXX. March cash second and was As short-term $XXX.X XXXX. XXXX, cash employee of million of decrease of had investments XXXX in cash, cash and to XX, June of compared of in XX, mainly annual the quarter $XXX.X due bonuses the equivalents equivalents distribution with as The million Company

ongoing that next authorized the XXXX, $XX up March Xunlei months. Board program, million XX stock of repurchase its to repurchase outstanding the Regarding in of stock over of the announced its Directors

million. shares of value were approximately $X.XX XXXX, of June As the XX, aggregate purchased

to Regarding have in the for construction, expect this under building Xunlei been the relocate research last and year. now seven building furnishing headquarters new building months, October to we the and we

the of estimates view to and of and quarter-over-quarter press material. subject X.X%. any between total at $XX to range a of change preliminary estimate quarter as change $XX release, of Turning the represents midpoint be of the for million increase which Xunlei date the management's XXXX. be the could guidance is These third approximately represent to and million, revenues

the the conclude we Now, conference ready we prepared call. remarks take are for Operator, questions. to

Operator

first from Please your question. from question MSL [Operator Sang Group]. comes your And [Lee Instructions] ask

Unidentified Analyst

Language] your This highlights [Foreign is of performance. Lee you the for and second thank quarter financial sharing

Eric Zhou

be annual U.S. Xunlei for, under company the is the inability SEC has Company's the Under accelerated the It's has to Stock Xunlei Thanks for as the this happening NASDAQ such the year been report Accountable year. impacted, in Company watch that know Company's identification be asking. delisting may if since is Company is the SEC Form year. And HFCAA asks, be on consecutive XX-F identified XXXX. by consider has next and And will by the the of he bill of been the May to He'd XX, could the from of list for from the ended on HFCAA filing believe as a result Exchange, as Company identified under SEC early acceleration delisted for HFCAA. the Act version if the where three in December Xunlei inspect paper the years aware like If of any this a its be countermeasures good question. result the XXXX. We Company fiscal auditor. if of a privatization. will its of the PCAOB's impacted, working delisted HFCAA,

alternative so U.S. the the and asking. Thanks China between a discussed far, talks as privatization, and has solutions of the And will public remain not company. issue. Directors for this monitoring regarding are to We Board proactively study

Unidentified Analyst

[Foreign Language]

Eric Zhou

Yes, Also you you. for thank thank asking question. the

Operator

you. Thank

next line will who question. question. Please your question from the And We of Sara a private next ask is take Hua your comes our investor.

Unidentified Analyst

[Foreign Language]

Eric Zhou

provide don't XX.X%, like At Her it's can't quarter, continue? quarters, down. it streaming a the live growth that rate dollars. rate in The don't of U.S. normal X.X% financial slowing Chinese computing the for trend and cloud be or quarter when of economy the we our streaming to capability this compared X%. dollars. edge our of we decreased extent, or this on numbers. cloud many we evolving quarter. our long-term over Chinese of future impact First competitive macro profitability. last computing X.X% cetera. all, due exchange to time, the growth X% to situation think slow negative a to streaming of impact the certain devaluation But estimate focused expect a COVID-XX, et business for business anything any of the currency was is growth of beyond live you. Revenue improve computing leveraging our Will it the we our Cloud We strategy have impacted again, business currency been top but rapidly and in development geopolitics, by to of revenue factors the question sign. live impact the into growing and was rate rapid we guarantee is will in RMB national the our first down converted commercial while line to revenue was U.S. by Since decreased and growth for around be the and Thank guidance

Luhan Tang

Language] [Foreign

Operator

take question. standby. will We Please next our

Your next Investor. the ask Please question comes of who Yuxi your is retail question. a Sang from line

Unidentified Analyst

[Foreign Language]

Eric Zhou

the he so. shelf collectible said digital know since off the that results, the of His digital what's the question, stopped He product business. to Xunlei's our the and wants collectibles outlook or been they doing has

really don't outlook. on products or companies' other comment we First, the

digital for the For being, of developing exploring. our are is both many with us, continuing developing in for -- trying I And and we as the it and And evolving endeavors has are greater terms institutions one in China, is regulatory quickly are environment. Xunlei market, business market the is the we of or products. different we potential. foreseeable several collectible we working of think mentioned technology future, And time to earlier, the business the

at said for the it's may to have and according we some explorations are emphasize largest in one potential it future. Thanks of Of just But relevant our of which doing many and regulations. also course, great laws the realize course, it's risks, great the great business, also asking. strictly having seek risks has we to

Unidentified company representative

[Foreign Language]

Unidentified Analyst

[Foreign Language]

Eric Zhou

have not and by streaming product. it's streaming in but now, we products. release, large focuses of by in audio we is discussed right -- efforts still of discussed develop variety a as we a release, audio our our press live press -- to And large it, And us. have live We as us effort our one

the well audio far, focus. be so been quite live future for last you And asking. Thank doing That streaming has for will quarters. several our

Luhan Tang

Language] [Foreign

Operator

[Operator the Please no this continue. questions audio further to at Instructions] from seems There be time.

Eric Zhou

participation. Thank you, your and for again, time

today's our our conference day. If you visit you e-mails at please great Thank questions, conclude Operator, any send to ir.xunlei.com Have call. or we have Investors Relations. website a

Operator

today's concludes for Thank This participating. Thank conference all. you call. you

disconnect. may You

Xunlei Limited (XNET) 16 Aug 222022 Q2 Earnings call transcript