UCL - Earnings call transcript Q4 2023

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Operator

Good day, and welcome to the uCloudlink Group Inc. Fourth Quarter and Full Year 2023 Earnings Conference Call. [Operator Instructions]. This event is being recorded. I would now like to turn the conference over to Jillian Zeng. ahead. go Please

Jillian Zeng

our thank Quarter and earnings joining on available us and Hello, Full you Year Fourth on now are and earnings The website, XXXX uCloudlink ir.ucloudlink.com. our everyone, presentation for IR Earnings release Call.

recent Mr. are on Chaohui Financial year in our fourth able Mr. Co-Founder Zhiping Shi our me Mr. Chief will Co-Founder, our discuss business begin Mr. Director financial of and for Joining Chen Executive your then Mr. of the Yimeng Officer, our Chairman and Board Peng, be of Officer. highlights will our that follows. quarter overview an questions highlights. call today's section to take Directors; all Chen, XXXX. will Q&A operational and and full and Chief with Shi, They

Before unaudited control, forward-looking company's statements expressly materially based results, which constantly management's the different and of qualified of that result or information, events, conditions except their please factors Please update pursue pursue Litigation that by obligation with call call unknown as the turn measures. comparable call safe unaudited the the also forward-looking details market Mr. to SEC. discussions cause Private not other new or known involve over by financial the reconciliation contain performance These Chen. contains earnings revise the provisions Please or release active XXXX. release the forward-looking or unaudited future achievements will to of from measures under risks, a forward-looking and not a include performance as now implied entity note by and expectations required be statements. company's press forward-looking any Reform to uncertainties results, the and go All factors and may any on non-GAAP I Securities in uCloudlink the these otherwise, statements law. and The this does financial of company directly current company unaudited are may note the expectations of information change made harbor GAAP the of observations uCloudlink in are ahead. statements, risk that Act non-GAAP measures. statements we proceed, filings of this to press statements GAAP conference most to

Chaohui Chen

you, joining us. appreciate everyone Thank Thank your for time days. morning, taking out good Jillian, and you everyone. busy of We

USD of set XXXX, We and pandemic USD strong XX.X% following of inflow X.X increase are by a XX.X X.X in cash million. the income net milestone turnaround to to of year USD was highlighted very pleased report in operating a million. million the another in XXXX year's with COVID-XX revenues results business of full our

markets, are and beginning In outbound tourism business major Our with connectivity pandemic year in continued to China tourists gaining the services X.X seeing to COVID-XX international data brand XXXX. the signs recover Roamingman and early a travel use more and of our Japan, the we recovery Chinese in business services our Japan, again recovery momentum. in following

going major in and these world covers that one for create the roaming extensive will growing, markets in countries share significant is opportunities network growth forward XG market Our us which regions. XX the most a of with

and which the market. solutions also roaming experience, local not in our roaming positions our Our user enhanced expands extensive further competitive cement full-speed XG but base offer coverage significantly leading only user

to beyond needs. explore of satisfy range business business turnaround cutting-edge years, opportunities technologies wide our over connectivity While possible resources to our and a we research working comprehensive to build and leverage data terminals array users' Wi-Fi development and expanded past efficient of and the solutions

the data needs users. connectivity diverse In the of to travel various addition by to enhance experience significantly catering

emerging and life help us convenient also pet and market expand business. management will through reach GlocalMe We market more believe interpret our intelligent and broader will these others, We our that offer like solutions communication, a applications among tracking, solution presence. item

of more advantage the out the a better daily of extend us Our to generating agile beyond emerging sustainable solutions travel organization this first, life, and to opportunities various SIM, sectors X condition ourselves new and GlocalMe of user is a Life. leading product this and into year base product business to [indiscernible] in growth. with operate fashion, with allow lines to in coming whereby we Things, second engage Broadband, of distinct GlocalMe aspects to robust empower will best Internet us mission IoT us believe take our business long-term transformation, We third our enable To XXXX. final future. life drive a GlocalMe reorganize the in broader the the plan Mobile/Fixed

So at what's me allow to you more come and please happening to tell about uCloudlink. what's

the more me array have in detail Let a go into planned lines future. new little of for the product we

offering foundation expanding believe an innovation in in our market. roaming led Mobile/Fixed hyperconnectivity share GlocalMe services the the We improve and of value-added will experience. Broadband we user we the addition are to uniquely technology, our First, business, expand strengthen of additional solutions to that cloud continue with to

optic as we addition, plan all major fiber connectivity maintain will local multiple are It lines be mobile network supports customer In premise to fixed disrupting. fail introduce CPE, as to equipment, XG operators. networks grade commercial or when which even able well from

space. will opportunity CPE large additional the scale broadband fixed XG in and commercial and be unlock mobile Our will

beyond ALL Wi-Fi including OTA solutions will us the which were SIM user a the Second, involved market. broader and in innovative allow eSIM to over-the-air engage with into terminal GlobalMe SIM, SIM portable solution, base our those and

smartphones. permit are of all-in cross-carrier empower out to is Pioneer break and restrictions solution Our

slate Third, future, product solutions which various of in our bring connectivity planned our scenarios. application daily the business into announcements an Life GlocalMe has exciting will life seamless high-efficacy

as such management, well list. thus pet communications, I as mentioned tracking item earlier, bundle As as emerging

module and with these We solutions integrate into compatible smart [indiscernible] both chipset business, our cloud third-party platforms. technology will leveraging also and connectivity band mainstream IoT property

Because beyond intelligently terminals multiple between our dynamically switch them networks empower have local devices, business will and worldwide. and more in we terminals data select of of changes and the our business a solutions, future. are making, growth Wi-Fi will connections everyday we we carrier high-quality scenarios. of intelligent diverse our IoT drive for portable array through Our had, and This convenient range enjoy to lives allowing third-party expand customers believe the

like would of I the to our of quarter year guidance full Finally, review year and XXXX. fourth

this reorganization. We about are prospects our growth future flowing business optimized

this However, transformative only will And take we to these also just that mature. we beginning recognize time journey. initiatives are

of XX.X the year same year For representing USD XXXX. decrease an compared period XX.X the of and a million, X.X% to X.X% XXXX, to we of fourth total quarter USD between increase revenues million to expect of

XX% For XXXX, XX last increase will USD Shi. XXX to million revenues million, expect we year to total be year an XX% USD to representing of XXXX. I now the of the from Mr. turn call between and over

Yimeng Shi

go Chen. is and highlights operational Mr. measures you, usage quarter will financial active as us everyone. customer an of metric $XX,XXX by reflective which fourth from period, were company day XXXX. quarter for XXX,XXX XXXX, XXX fourth the for increase important each trends our average over of owned partners, of business owned Hello, of and our XX,XXX in an of In business of Thank our quarter the X.X% full is year and operating terminals it representing daily I the by XXX,XXX, the Average which XX. active and terminals fourth over performance.

daily terminals of services. 'XX, from connectivity were of XX% data active international of quarter first X.X XX service connectivity the terminal from uCloudlink local During the X.X active and uCloudlink daily were data

increase revenue up XXXX. was usage in Our the same period gigabytes service from terminal per period USD Total as the from XX.X% of of XX.X same were XXXX same increase of December million, period representing of XX.X USD Revenue X.XX during steady an from XX.X% million for of the XXXX. million, percentage in during the revenue USD USD fourth XXXX. from of was XX.X was a XXXX. fourth from quarter data the the representing of million quarter service in XX.X% to an XX.X% Revenue XX.X XXXX,

gross total quarter contributed and other XX.X% the regions first North Mainland compared percentage a and and the XXXX, of America of in same respectively, increased XXXX, country to gross XX.X% for from for XX.X%, X.X% XXXX. XXXX China service remaining the Japan X% XX.X% XX.X%, contributed XX.X%, on quarter in During XXXX. as the the the for period period XX% same while quarter Overall to contributed XX.X%, improved fourth to of period X.X%, for margins XX.X% from the same revenue, margin contributed fourth

revenue operating million to total share-based of USD XX.X in the tires expenses XX% Excluding compensation, in XXXX. million the quarter EBITDA USD compared XXXX. of XXXX. compared XX% USD of X.X to Net total XX.X a loss X.X of fourth quarter to in the to fourth period in was XX% same in USD revenue 'XX compared total million in for the XXXX or of or X.X period net USD X.X the of million quarter same the same was million million loss of fourth USD of Adjusted increased

full of from accelerated. which USD Overall increase XX.X% attributable XXXX. higher XX.X% services connectivity data in improved an from tend XX%. data XX.X in XX.X service to XXXX. in to gross a to primarily connectivity a increase on And in million to proportion margin USD services data connectivity international recovery service gross USD our an from XX.X XXXX in in million larger in driven to to Total came million margin from data the results. year's travel for Moving XX.X XXXX revenue This XXXX [Indiscernible] USD financial on services. by in XXXX to rose as international is was XXXX, revenue connectivity favorable XX% from services, from XXXX more in gross margin have increase XX.X XX.X USD Within million of XX.X% services, mix, connectivity million, margins. from from increasing million in revenue from USD primarily with international were rose revenue data Revenue

compared XX.X in year compared USD full of total the from We X.X EBITDA a to of a XXXX, expenses in compensations, million loss of according million in to to was X.X million total XXXX. in XX% USD of XXXX of measurement. million improving in or For $XX.X revenue XXXX revenue X.X the decreased income or operating net Adjusted USD XXXX same XX% achieved a XX.X USD net loss XXXX. total share-based to in million million XXXX, USD excluding

to compared year million USD USD XXXX, capital X.X were For the full X.X XXXX. in million expenditure our

year of XXXX. million XXXX, full the flow USD from we USD positive operating up achieved X.X For million, X.X in cash

to balance sheet our on Moving items.

as equivalents USD and cash of increased million as XX, of Our million to December XXXX. cash XX.X compared XXXX XX, to XX.X September USD

to to for up open course company's Q&A. of the our financial the pleased positioned We and growing operator years have strengthened over continue let's are that, business. are position well the With

Operator

[Operator Instructions].

comes question Research. Litchfield from first Hills with The today Theodore O'Neill

Theodore O'Neill

connectivity was data into million from questions this in and third of give us X down services first question you have others. is revenues quarter. from that I wondering My if was driven than that in That's if was insight more I it some $XX.X quarter. any $XX.X morning. geographic by particular region sequentially so the million about could the down And

Chaohui Chen

the fourth compared quarter You with quarters, mentioned third the the X quarter.

a international big time location, is driver As in our so a change seasonal you the And our service. service. on third similarly, know the the the this that's a and seasonal roaming summer a for main fourth, service in is reasons time the little business. growth is disclosures, peak quarter [indiscernible]. bit pattern a down That's it's the roaming for And for roaming of

Theodore O'Neill

it geography? across geographies? is And it all is particular Or any

Chaohui Chen

the of quarter third short fourth in the the a year, vacations. In change. period long only summer like is But it's the Christmas seasons quarter, overall holidays. That's

the So particular some to regions. seasonal particularly overall change, not that's

Theodore O'Neill

what rise noticed quarter to from My the last I quarter. in this same in fourth quarter sequentially went other quarter. G&A? sequentially change of from to G&A the year, million question in from wondering I expenses expenses also drives the G&A was year, million it fourth third and XQ million quarter $X.X in to is $X XQ third And $X that the thing, about the the

Chaohui Chen

our From our good employees. plan for incentive a that's understanding,

loss huge XXXX. performance the revenue we income turnaround also the disclosed, positions of and positive leading terms compared to with we tend in growth the year in As

the company whole the decide So for for pay significant [indiscernible] management to increase a employees.

driven specifically [indiscernible]. of that's So a pay rise by terms in

companies tight our controls support So think have this year. that's headcount year, our we the to whole a motivated good and are I motivation course employees numbers in And for our this well the very to years growth on growth. of employees, and

Operator

The Wei Diamond with next from question comes Research. Zhang Equity

Wei Zhang

be also revenue, of to did would about which first your My fourth million. quarter guidance $XX million question $XX the meet

So for we'd know like expectations reasons not first these to for the meeting quarter. the

Yimeng Shi

fourth just achieved quarter quarter's this we Chen 'XX, Mr. patterns. It's deliver the answer some guidance. a had some We guidance guidance periods the and XX business the in On hardware to million. have color. then is agreed This this little a little than just some our is orders. later by we our Yimeng low lower revenues Shi. USD XX.X to fourth We questions I'll now will customers. bit We first on still than disclosed hardware orders commercial the million that as this customers deform this hardware before add we of terms bit because

taking consideration business in into mix cost, guidance. Our hardware is we the these deliveries will normal this

of the as let's December. So take final month a in of change week the

Chaohui Chen

But for R&D less because than our bit delayed a cause little our new have another just reason That's we to product expectation. our reason.

bit than little our that's reason expectation. caused So that less another a

Wei Zhang

launched newly your any year in the be the announced solution question share expected that to products this Like you GlobalMe like or XXXX? mentioned, business? about information is can So next or boost services revenue you can more

Chaohui Chen

So create business Life revenue. portable GlocalMe XXXX, last trial. in as from we in the products so our our such new third SIM smaller OTA product to as the Wi-Fi major our for are the year we on early such the start launch year card, traditional majorly before the And to quarter,

So means because condition we aspect product. will data. the this can GlocalMe condition, That better better we launch officially from that our need who are people create year, Life revenue create a we

people. Another life better we can a aspect, create for

easy For X in they're Normally message to poor. the network is to example, best down is bathroom when rescue if people fall signals send down, very kitchen, these the in center. their area we of SOS old it and the the falling can most get

similar not also can provide enable home people SOS all can then tracker. product another recognition, set. about across get Wi-Fi help out these Our it's mentioned only and local signal the I then but critical And or carrier send these message the product, a can

location something building normally tracker market tracker can is in the our the can as network in because IoT send poor. corner a data tracker find the that because the with normal GPS Our scenario, GPS of and the area, rural carriage via really

why you solution, of something items. But people more is meter. station, XXXX-basestation have product carrier laid scenario, to not we we we difficult these the for help meter. location very So the the our checking X network. better carrier, help users generation tracker in before. active tracker on creation get the out we the to That's rely multi-carrier about with new XXX items. radar location course, tracker, can your while accurate marketing A tech tracker as also the without the just can we healthy can this -- other concept which we generation our communication that's where IoT, what and carrier And fire carrier, about traditional mentioned capability, can single base find emerging device. than XXX second our more for the that's fit station for marketing only new network has who items data. contained last out so one one out location call out market it's can carrier last in these tracker message you But XXX stations, super and with possibility network, That's location just data. And and a the final this fire one, we base technology our out high call can can with And It's base [indiscernible]. out our the that And sent have similar is added why GPS multi reason reason. maybe connection provide the fly can

and quarter quarter the fourth were a fourth for one and by launch. in volume the launching scenario pilot quarter one, this is So second the for product we

think this the I we revenue following So in generate believe or product for more quarter, us. new will create

for including As also OTA you our selling eSIM. more that we more understand, assess Wi-Fi, we travel have solution, portable customers easy is ALL worldwide. can SIM These than traditional SIM, generate

the more new these base our revenue and more all believe in I will following business. for So create base products customer quarter,

Operator

any our over remarks. to conference Zeng back would closing for to concludes turn question-and-answer Jillian This session. like I the

Jillian Zeng

once today. joining you, for thank again, us Well,

If contact next website you questions, on contact to free our call. speaking have investor provided look or information relations you the Relations again or our forward please you. to through to quarterly to firm, Christensen Thank on Advisory. feel Investor uCloudlink speak We further our

Operator

The conference today's has for now concluded. attending Thank you presentation.

You may now disconnect.

uCloudlink (UCL) 14 Mar 242023 Q4 Earnings call transcript