DOYU - Earnings call transcript Q3 2021 | DouYu International Holdings Limited

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Operator

Good morning and good evening, ladies and gentlemen. Thank you and welcome to DouYu International Holdings Limited Third Quarter 2021 earnings conference call. At this time, all participants are in listen-only mode.

We will be hosting a question-and-answer session after management's prepared remarks. I will now turn the call over to the first speaker today, Lingling Kong, Buyer Director at DouYu. ahead. go Please

Lingling Kong Interpreter

everyone. call. Hello, our Quarter, Third Thank Welcome earnings XXXX you. to

Joining Chairman Hao Shaojie Mr. Mr. us are today Chen, of Chief Officer, President Mingming Strategy and and Vice Mr. Cao, Finance. Su, Officer, Executive

can website ir.douyou.com. our results at to financial You refer on our

available website. also replay becomes can few hours call when of You a this on check it a in our IR

Litigation Mobile the or different new a of sustained events pursuant for speak RMB third previous momentum any quarter, million. Notably, that or I expectations the growth. cautionary start, call and known call. reaching may Shaojie average statements year-on-year by revise drivers on the Securities drove the XX.X made please the In while undertakes Company no revenues our the MAUs the the and steady statements our key old uncertainties, to which provisions, statements, Harbor note made based duty user this implied factors actual developments X.X year-over-year accounts Mr. X.XX for expectations expresses growth Chen. unknown The continued maintaining paying quarter entirety factors behalf Company's Act growth. to factors, Company for and revenue These the filing generation, Chairman million may statements. to cause we be [Indiscernible] raised date and were billion XXXX. RMB we average results, qualified from of or Safe results, All quarter [Indiscernible] performance, the from progress RMB these not of Before forward-looking representing forward-looking the risk are Two now the the involve for quarterly of statements achievements forward-looking performance, this X.X% under Reform forward-looking net Total by growth all Private our on contain their and control forward-looking other SEC. circumstances risks update of traffic selected observations statements exploring in that in current conference materially after will management's and details and solid CEO, with or

earnings benefit broadcasts as large-scale the continue LTL mentioned [Indiscernible] eSports call, users galvanized tournaments from [Indiscernible] we attracting broadcast inactive the last such to of eSports not to new our in Summer several XXXX. also This but First, return. only as

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needs, comprehensive [Indiscernible] content. cater eSports between domain Now, And of wide our path elaborate, content top large-scale content. to in foster base personalized our user game on operations, for eSports high-quality a tournaments, centric user users. refine Generate turning community comprehensive game our - to our and to close our [Indiscernible] partnerships provide maintained updates. of foundation generous. In developers the game, The quarter, user our our the we our of range we with for content continue To and [Indiscernible] our content ecosystem variety expansion. engage content needs, solid of highly each expanded underlies to library, continued which content eSports

In as for PGC tournaments forecasting wide multichannel with content, the -- large-scale our highest-level live to meet XXXX large-scale [Indiscernible] is predict tournament users. summer over operation in-house the quarter a on the Notable [Indiscernible] League LTL the We've eSports forecasted sessions over of Focusing Legends the tournaments. sum eSports eSports and provided forecasted core tournaments [Indiscernible] for which XX the we the China, tournaments and in-house. professional content in-house. in with the produce XX

seat front, for incentivize will Kapor, all and attracted days mobile We the new initiatives. the game featuring CFML the Chinese mobile users vs over invited experience. we On Meanwhile, through keith to in a of users to Eli's deal. campaigns viewing of [Indiscernible] of League. emulate for of professional eSports crossfire XXXX overall professional and the in-game our programs, tournaments. [Indiscernible] to Stanley new number taper social More to Korea participate drive growth. copies mobile, X developers, League a years at League engagement, promotional peace as South that items we raise through? marketing tournament improve Legends, I'll Summer experience. and rate users four also walkaways, high-value and building galvanized of the of we've camp China XXXX and analysis total marketing tumor came such successful and related our improved launch self-produced are new Furthermore, operational exposures, the number events, swim who Elite high influencers, and attracted yielding

and clip, eSports user forecasting enhance non-live a also function large-scale in engagement on-demand community produce to an and playback incorporated graphics, tournaments, further conference. this relevant the During of discussion series we video

attract with non cycle [Indiscernible], our endeavored better high-quality is graphics, full integration game graphic video features cooperation to given For community each non more and interactions upgraded with Even and our that format. We we games, of Morgan genre. product the content strengthens cover developers viewed [Indiscernible] gaming to and Company live in games to gamers, and eSports of esports streaming, the platform. more life operation

we content creators able immerse to users. our to links for we're addition, make and and [Indiscernible] refine discussions in entertainment, platform. learning attracting our operations, various that's our hold features, hot content In users more and high-quality topics, to continuing among relevant product and interaction optimized interactive guided to are Through developers [Indiscernible] and

strategy good for made in [Indiscernible] segment, progress recent have graphic, we live-streaming, importantly, video, for community, including our games. our operating eSports More launch, especially non and each

Turning third its sample, trajectory game flagship the showcasing quarter's high risk-taking return quarters, the launch in in our growth Bladepoint, last our Naraka: to users platform.

volume. For platform content product engagement other Golden upgrading segment more offerings, with user games, [Indiscernible] quarter, Spatula commitment this Battle increasing also Harry are optimizing These continued top Awakens and staying interactive streamers, Metric on our features. live to of improvements new based long tier performed supporting results well, our Potter, of customizing global as and our and streaming operations, and

our research to we During and augment efficiency, capabilities. resources the additional quarter, production committed content to development our

video a and room in For example, third a we [Indiscernible] training new production content the production our in function launched on website. quarter, choose, one-click

content streaming With of the attitude these two, users and upload two latest easily the [Indiscernible] sessions, our and can [Indiscernible] community minutes add segments. Baidu to the

We expect simulate will creators’ communities. to interactions update our this that increase enthusiasm within UGC content and

continue Going content execute to ecosystem - centric strategy. our forward, game we will

of diversified continue will And to users our more content games. We of refining the enrich our popular to through attract offerings and means existing new operations game meet users. our of with

op paying proactive monetization. offering engagements turning with were execute user user to We third users, we as the X.X to our continue able pool size and paying of users, to to quarter, of of quarterly Now, strategy, an sustain tele our RMBXXX. In improve quarter paying the million code consumption.

keep We contribution the model. [Indiscernible] masters, while monetization from maintaining exploring revenue also new traditional stable

Let me also development touch markets. in on overseas our briefly

last live the apps quarters X Now video app mainstream in to Japan Games for games remains one streaming of earnings. the top-ranking according

during over through users quarter, growth. monetization and explore while of in and models the game are offerings. new Given market improve multiple our made we summary, our comprehensive will position to with and in monetization Leveraging Combining gifting paying game content community. and is you'll quarter, operation to we in full live progress. providing In interactive competitive consumption plan corporate video, healthy our streaming, achieving that we developers and on dimensions enhanced diversified to They land development In now call and graphics, performance solidify Building continue gamers will full Finance, we industry optimizing the what content of the Mr. Cao Hao efficiency engagement, go operations. the maintaining deepen maintain quarter. the I leadership to details strengthen made to in analysis. in our initiatives, consumer of and product live-streaming financial Mauldin. the turn further will meaningful and investments, to exploring the growth President our the of our through effective commercialization Vice the video over in performance capabilities debate during financial scale, the collaborations our headway Mauldin Japan future, we our steady

Hao Cao

XXXX. X.XX RMB of quarter X.XX in [Indiscernible] X.XX period revenues the in RMB Thanks. Good billion, RMB were streaming third evening. everyone. billion, revenues compared same Hello, of XXXX billion live were with the

advertising implementation year-over-year and was Our comparison. live RMB offset revenues streaming sustainable of business due due with the higher trial in designs user and of about in in same conversion, model new our our testing growth million traffic operating strategies. standout decrease partially per for were XXX.X decline base revenue The last relatively of primarily launched engagement commercialization XXXX. increases decrease remained other year paying channels. RMB more This portion was resulting of notable Advertising the was to effective live traditional operational led our we traffics of to fan streaming several A compared user, XXX.X advertising period summer the of to average in stable million driven by a paying in to long-term year-over-year strategy. was revenues revenue monetizing in organic through our

This RMB by X.XX As quarter to decreased spending decrease to long-term in period RMB The acquisition. of period XXXX. promotional decreased decrease with XXXX of of the XXX.X the streaming XX.X% inventory. in to bandwidth increased represented third revenue partially RMB improved XX.X% a as of in XXXX to channels gaming increase in-house. costs This million quarter were possibly same or additional personnel million of of live profit investment and of costs a content. million in income upgrades line XXXX. revenues of a continue the of X lower user XXXX major XXXX. growth. third adjusted of million Gross offset million XXXX were of which from in mainly from period of same our rights our specifically, XXXX, the due quarter result, million, in same third the XXXX XX.X% exceeding period tournament lower same net broadcasting shared enhancing income X.X% was the technology X.X% third of million period of due same XXXX compared This same revenue our period in and from share-based the e-Sports user XXX.X XXX.X compared third Sales net XXXX, additional in expenses billion X.XX of and from RMB Bandwidth investments, same RMB million the in increases XXXX. in in the expansion revenue margin XXXX. XXX.X share-based decrease an quarter bandwidth An we the continued from improved in million invest the procurement from X.X% RMBXXX.X utilizing XX.X of fees short compared increased content RMB same knowledge an and in for X.XX in RMB investments third compensation income the XXXX. in was suppliers higher in investments operations continue decrease million the gains, costs in some in of the primarily loss It from as which quarter million primarily in the in XX.X same experience. More calculated the and This [Indiscernible] X% the operating income of with expect XXX.X was loss period million. decrease Adjusted Backup with billion of compared decline attributable XXX.X by proprietary potential mainly XX.X high-quality benefited infrastructure decrement and RMB third in adjusted the majority million loss increase end fees current revenues. and RMB with by equity expenses quarter to of quarter period RMB increase revenues with XXXX. period marketing upgrades of the period the net the XXXX of RMB to third the In for in the decreased XX.X% in XX.X due RMB million XXXX. of Gross costs quarter of by excludes same costs The XXX.X XXXX, to was of in technical development method quarter to impairment the due mainly in share X.XX RMBXX.X RMBXX.X we is of expenses in of our and RMB decreased was quarter third same forfeited XXXX. we with RMB with which production, of on in compared was the sustainable third XX.X was was period were content loss million the of billion to XXXX. term overseas the Research Net by RMB in in RMB costs. RMBXXX.X the result of efficiency million, sharing was expenses which of compensation from million expenses, of to

basic third X.XX per of XXXX basic RMB respectively. RMB ADS loss X.XX loss and and net were X.XX The net respectively. and quarter were and RMB ADS Adjusted diluted per X.XX diluted RMB

of cash provide would may restricted as and long-term XXXX. equivalents, program update repurchase our until share XXXX. We RMB cash of execution As announced X,XXX million, August the the to compared its million to on shares deposits US$XXX bank of repurchase XX, Company an RMB August with like In up also XXXX. of which Company and on bank had short million XX, deposits XXXX XX, X,XXX December of September cash,

XX, this Company the under As an had of of repurchased $X.X worth its program. million of aggregate ADS XXXX, September

We have monetization improving further monetization continued our while of in-housing capability, efficiency.

Additionally, today. take focus are support to continue ready platform. grow, leverage we on our we the development to of for as Operator, concludes remarks to we will further our utilizing our sustainable This operating questions. now prepared

Operator

go session. the Bank first of you gentlemen, question-and-answer begin we Ladies from very ahead Instructions] and [Operator America. much. is Thank will Our question now Please of Zhang Lei

Lei Zhang

[Indiscernible] question. [Indiscernible] my here. questions taking Thanks Two management for

First, on and -- holds process approval comes set regulations [Indiscernible] an look you. look the enough see impact how our regulatory long increased and from see [Indiscernible] your in revenue of which forward? we as going Do tiers should forward? Thank game agency. in we on or mainly do the change corporation at That ratio hosts adding our how or sharing the an [Indiscernible] on you across substantial the the do we live-streaming at revenue going major increase and recently

Hao Cao

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Shaojie Chen

[Indiscernible]

Lingling Kong Interpreter

- to answer any we First, short the talk question of users. existing a first The for seen regarding have impact lot your our games. that is, suspension of on new not to games new significant

regulations, otherwise we've of are is games of launch counted in X either actually suspension terms is X new In the or seen currently and moderation. there

game new -- first, a it launches, will the slower on new suspension For the the is impact of acquisition. can actually, have user

which spenders actually of For us, on-hold high-quality the quality cost this gaming market, new the kind we that is run. -- gamers, high, expansion actually industry of new will and game. for Spatula. not be more Which approval for believe, on game of Recently, the such they launched will than, approval Golden for Battle game new long in whole there of the seeing rather is we're is is as be of platform games into our us, launched the very beneficial the

there. quite encouraging We operations over have seen

regulations. of on platform one that gain with the to And we is especially will the the make ensure other Company gradually they fully and we that, content the other they sure compliant the semantically. have offered management, the -- quality to the regarding game, hand, -- current will adjust are the For containable on those -- on hand distribute for cannot duration, our that approval don't content rate.

will second to landscape by on Regarding the industry is similar us under percentage. not the contract competitive your question the be -- their [Indiscernible] the Actually, currently affected competitors in other on sharing sharing resources. raising revenue with

the number limited. that first industry seen in the [Indiscernible] we available quite streamers have is course, is Of the of

can streamers that hard is contract. it's quite thing their landscape establish to for with new from that seeing platforms. on to remain the the slimmer other [Indiscernible] We're since competitive current current ecosystem existing very moving And So, the be is similar stable. platforms a far entrants for are resources competitive that --

is number offerings before refer in with to of large to not terms of the new will new found We it of game content segments. collaborate game especially platforms we other games. sharing -- the all be streamers, factors ensure a revenue quantity you quality actually so So, increasing to promoting light all have agencies the and in high extend the attract of by nearly and above, able [Indiscernible] their fees talent

have streamers and we have we new we devote big doing data top those actually -- them revenue become and to know-how promotional period. new to the In resources the percentage, operational of game certain lots our offer streamers help to for segment. to So, some of incentive streamers analysis term sharing

we ratio on quarter-to-quarter. So to going industry current will ratio therefore, according dynamics we it believe that Operator sharing adjust shale and revenue may fluctuate from And [Indiscernible] reasonable other the thank our forward, while revenue the you. is

Lei Zhang

[Indiscernible]

Lingling Kong Interpreter

thank Great, you.

Operator

ahead. Thomas Jefferies. is Thank next question The of you. Please from go Chong

Thomas Chong

that we in [Indiscernible] is video streaming [Indiscernible] the platform, internet. also slide [Indiscernible] the think investing short-form are the online video seeing I question

the competitive launch with going is, games second can data are you. market any be So, see I market, landscape one forward? how newly we shared? we and the seeing which meet think how in just to better question we want are my to And and should Thank regard about can the the doing also

Shaojie Chen

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Lingling Kong Interpreter

not -- quarter landscape of in fourth live of since you we the moving in for significant streamers industry this since are prohibited game question year, a stable And between Ever their has much. industry. the fourth platforms with the so remained that competitive on inform streaming account here do we changes the competition the stabilized. see have Thank the is quite

that more [Indiscernible] We attract short will We game which we has to been And generated market for video more believe live for traffic today's a expanding entire have platform the streaming in sector. have game size live group seen industry. elder the sector, diverse streaming the listen live potential

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content understanding few is past the So, exact ecosystem. seeing centric our there's the -- AVX - years. accumulated game rich and gaming to over experience Leveraging strategy our establish industry of

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Hao Cao

answer your question. second me Let

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Lingling Kong Interpreter

Operator.

question, Next

Operator

Thank you.

Lingling Kong Interpreter

Please.

Operator

question Zhang next is The go ahead. please China of you. Wen Renaissance, from Lee Thank

Lee Wen Zhang

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Hao Cao

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Next question.

Operator

is JP go Morgan. Daniel ahead. question from Please Chen Next of

Tim Chen

ask will I'll taking [Indiscernible] myself. you on my Daniel. you, for questions. of X Thank Management, questions [Indiscernible] translate I behalf

$XXX the you. progress, of the the a and us your Firstly, The some Thank diversify on traditional advertising color give us you share leveraging repurchase second you expectations current Can seeking million additional question, by more is Company ways on some resources. that? monetization can that on progress to mentioned you brief programs?

Hao Cao

by to revenue offering we advertising generated question, first [Indiscernible] The this. and advertising game brand

remained on Our stable, driven platform. user by relatively brand has stable advertising revenue traffic

[Indiscernible] We certain advertisements implementing of and new have [Indiscernible] game monetization resources.

our traffic revenues a model. On banners, and reallocate resources for side, the to new advertising our of commercial the advertising live streaming of portion we sacrificed some monetization

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have we First, and proceeded resources of streamers cap batching, game [Indiscernible] and ability pricing, between live traffic. distribution leveraged

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continue repurchase [Indiscernible] quarters. conditions, SQ current by our to Thank you. have appointed we updates will regulation, required professional we to share provide Subject coming institutions in also schedule. As market the to on

Lingling Kong Interpreter

Operator.

please. question, Next

Operator

ahead. is of from next Morgan Stanley. Thank Alex you. The Poon go Please question

Alex Poon

And expectation you. My Cloud some question our performance forward? is expect question we third we for regarding businesses? second quarter? And Can business. in the [Indiscernible] Thank how do business, first what get our is overseas is update gaming future and regarding going the

Hao Cao

Cloud mobile Android We for industry. to new games gaming gaming the opportunity development store. of update such a Let have After ago our a the exploration for game. with And now about product of we Cloud the -- game as is the the your me are largely answer also than [Indiscernible] and Grand that mobile complete. the partners our question features more quarter, continued Cloud for Theft year product based play believe [Indiscernible] watches

had gaming a nothing to speed the capability. limit such [Indiscernible] culture, of number However, copyrights, as and by issues

opportunities [Indiscernible] gaming with our gaming platform developing of of contender As capture cognitive the position the to [Indiscernible] the industry.

Shaojie Chen

[Indiscernible] [Indiscernible]

Lingling Kong Interpreter

markets. will the questions your overseas development Chen address of regarding Mr.

the monetization. For the actually markets, before our it's is strategy traffic acquire overseas to

year -- we once side -- at we quarters. -- domestic can the has few the in remained has two been profitable. the made in to live Japan game a business majority in last for actually our been size top may accumulation Mahjong user Seems very strategy healthy investments of prioritize and the users’ And actually, Japan. years quarters, China monetization. this Over has the means developing Japan, our from has App streaming the Annie, most raise to in especially app Which video traffic According level. past been actually, sustainable overseas, our user

monetize Going integration forward, we will further losses. -- enhance gradually our capabilities, narrowing narrowing and

you. So overseas improving as we continued successfully our in quarter, such, Thank the in have efficiency and markets. operational our the third reduced losses

Operator? please, question Next

Operator

Sutton of Ritchie The next is question from HSBC, go Thank please you. ahead.

Ritchie Sutton

to that translate me try question Let myself. [Indiscernible]

you when in terms contributes of First all, FIT and -- the the video can update us on of community more MAU. features? the also and What's how update

the Second trend question that comment content how on to be cost is: going and trend this Can you. will the quarter future? you Thank in

Shaojie Chen

[Indiscernible] [Indiscernible] [Indiscernible] [Indiscernible]

Lingling Kong Interpreter

ensure [Indiscernible] regarding In compacting of traditional and needs the the strength excitement the Actually, continuous strategy, video users. ideal will e-Sports nature order games diversification distribution part satisfy to our derived the businesses. from competitive content in live of willing development present community content day our the channel Xth streaming accounting makes our our as content and The each offerings. duty. address [Indiscernible] the training question, of the of to

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game community platforms. and part all in are aim As as our create content graphic live our each interconnected, to of We you for ecosystem. know, a content separate segment video streaming,

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with our strategy. execute further investments continue many content Additionally, in - PGC production, to content centric as game we

we major the to have given determined and our LTL ahead, cost have of pricing been right programs. self-produced Tournaments that Looking managed control that of already the for

the look these for regulated to costs and next for We of associated -- Thank spoke and with everyone On Thank you. remake call. with you. them self-produced next thank speaking to stable forward future. expect see quarter joining behalf to quarter. foreseeable rise anyone the We content you our management,

Operator

Thank today. Thank may disconnect. you the attending, you you. and That call for concludes everyone now

DouYu International Holdings Limited (DOYU) 16 Nov 212021 Q3 Earnings call transcript