LIZI - Earnings call transcript Q1 2021

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Hello, ladies and gentlemen, thank you for standing by for LIZHI's First Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. After management’s remarks there will be a question-and-answer session. Today's conference is being recorded. I will now like to hand the call over to your host, Effy Kang, Head of Capital Markets for the company. ahead. go Please

Effy Kang

and much. first very our and to call prepared founder and will earlier a welcome call and online. Thank XXXX conclude remarks, Hello, and and Marco CEO, Management Lu. Q&A our earnings Inc's today, Ms. with services CFO, the newswire quarter results released Acting are conference Chengfang LIZHI include available operating session. will Participants today's you via Mr. everyone, they call. financial Lai; on our begin with will We

As a is being recorded. reminder, this conference

addition, webcast be earnings conference our In available our of will ir.lizhi.fm. highlights at presentation of the call section website replay and on IR the this

provisions please discussion as Secretive that today's Private intend, continue, XXXX. statements Litigation other will Reform we continue Act made expect, expressions. statements will, note believe, such the Safe words of potential, typically contain or of U.S. forward-looking Before estimate, Harbor target, These may, contain under the similar

inherent call its unaudited results The Please ahead. our I LIZHI's of financial to business of involve and information, non-GAAP those press and now update release control. earnings factors number non-GAAP Founder uncertainties could Marco that GAAP are to of law. that statements a press CEO, release conference note as uncertainties. and the obligation to the financial many do Please GAAP differ Mr. any will representatives company, of a unaudited discussions beyond these Lai. contains actual materially and anticipated, applicable undertake measures, call cause accuracy statements LIZHI's go measures. be The unaudited projected turn this as include required from by as measures over under measures. risks reconciliation affiliates, risks which unaudited Forward-looking and advisers, to except may impacted or underwriters our of not forward-looking these well

Marco Lai

everyone. today. Thank us Hello, joining you for

robust our we throughout year. the quarter year this started solid growth of off first strong a very XXXX, development maintain are the pleased to sustainable have laying momentum We as in for foundation

base mobile to million, overall our strategies. by the users grow effective to to Thanks XXX,XXX. the execution in XX.X paying average reaching increased of with monthly average Our operational approximately while the user XX% continued quarter, quarter-over-quarter MAUs

growth also revenue first witnessed XX% We the up sequentially. our RMBXXX and million, quarter strong XX% in of year-over-year

technology, link During quarter, virtual audio our meantime, and business our advance the more and our development. building our to in core globalization processing overseas the continue like share to In transmission core recent I enhancing ecosystem, in our particular in capabilities would first and further to information to we empower now continued we you audio footprint AI reinforce developments. expanding strategy. on the with

community the Notably, audio-centric level average X.X on interactions quarter. built maintained times billion its UGC monthly First engagement first the App our maintained high in the of LIZHI during our period.

As to March, of show the enhance our the audio surrounding operational [heartfelt content reached we content community atmosphere enrich the of topics]. cumulative as and genres platform million continue strategies, end part across of XXX

generation, our including to promote and of younger of literature, ACG, with these attracted join has listen tap platform. audio forces a joined uplifting premium that praise vibrancy the content outside to platform on of youth the amplifying we create influence. content our audio These efforts and by community influential to of to our and the share are audio programs number users our to number for widely communities' expression, effort large Your emotional and across genres programs KOLs sought exclusive into and a

In our addition, creators we on committed remain to outstanding grow content helping platform.

LIZHI successfully talents. influenced In held of to supported our creators produce to more their and unveiled our lovers space enjoy creators content we attracting content together voicing carnival Festival. showcase their discover the star content the voice and show through online content them talk creators people various Voice to talent. app, program, content a and For featured and also come specifically talent for for example, branded vocal providing quality vocal events but celebrities, to a fun variety early industry These XXXX our of April, voices

entertainment creators streaming can join segment users number outside audio having audio our In our the contents encourage have During content than meantime, features increase the Leveraging therefore, the to engagement creators gained the X further our the users, million and and more build streaming attention efforts were of there the event, streaming across diversified in also live strategies, and under widespread engagement the both personal we the our show effectively. segment interaction segments. the user UGC and boosted of and in interact increased interactive people community. team upon content and the effectively live has live integration grown interactions with to participated and content audio platform. Those our to pre-recorded from user features and our

we strategy continue our App audio-based markets in first networking strong momentum app quarter. overseas As targeting global executed social the our growth TIYA its

user products Furthermore, overseas integration enhancement LIZHI’s TIYA social are in of of XX% apps with the continuously operations compared a more market. work networking in related the to MAUs note of fourth increase in quarter mobile we optimize the social average pivoting in that along aspects. U.S. to In the retention, remained by representing pleased mobile rose March with engagement of We to scenarios among leading XXXX. MAUs extension quarter, the and million than the to the X

play a of interaction. live online strengthening user to interests across with user's circles, the topics. And via and the first networking Our Meanwhile, capabilities also is audio help TIYA TIYA quarter, we people games new grew and features all and various social in the user exponentially spur who users further the real a that interest wide of kinds the interact a share carriers both connections form gaming to generate topics, of focused the noticed thickness we streaming. joined number to greatly virtually users make interacting making TIYA. groups their In TIYA social on interest enable on while with animation TIYA’s interests friends time platform and range of diverse audios, on based which group improving user

In topics. addition, growing engagement different user saw social across also groups with networking we

of of prior first friends seeing our Noted chat topics a daily monthly wide in animation, are chat users on from XXX% cetera. the increased, quarter We made gaming, wide average including more spectrum the the by topics, on et room lifestyle rooms music, in TIYA. based new area interest life, quarter

user XXXX. December XXX% As by friend increased of number XX, March from connections of the

younger to chat, connect with on younger to the TIYA generation also friends but networking For effectively platform time this users to make a space is not gives social and tool get with real new generation. for audio-based only know

we ahead, and strengthen further optimize Looking presence. features product global will to our broaden footprint

social are demand as We to initiatives, network support TIYA we long-term on poised their and loop closed attract share a focused form growth. to more generation a needs. user upon and to remain also operational our catering younger effects innovative Building to that networking use decrease will we stable

multiple LIZHI podcasts of our virtual variety leveraging advantages a we of features In XXXX launched scenarios. in that the Podcast terms telephone of Podcast of user offerings and and the devices, January devices and content brand applicable new applications are implementation to on

have strategy the to that elite co-operations LIZHI spending enterprises. our the propelling of been number compatible with vehicle establishing models. to the are Launching market. spirit, scenarios, in-car are We products Podcast we roadmap more this increasing audio in-car In

include domestic and innovate makers partners WM such new ECARX automotive motors company as more Our the Motor. technology and leading companies intelligence electric vehicle

way. in-car In scenario, technology, in of expansion the addition are increasing popular we our and amongst aesthetic In particular our users. to art diversity the committed content to podcast lifestyle either entertainment are highly our

enterprises our forecast. continue brands content debuted feature Mart Podcast app also time streaming. [indiscernible] to creators between provide streaming pockets brand original only provide real programs early copyright increase connection of To proprietary LIZHI Tiger awareness, new users including collaborated with the content blockchain-based conduct WM efficient live promote forecast example, KOLs in live podcast to We more branded podcast greater order help from their developing for to solutions protection options attracting to cooperate in and apart leverage to copyright copyright to two with original a broker, with Motor created creators MTN We and his interaction through creator. to more meanwhile, April content in Pop with and protection

of better more also only between podcasts allow streaming be Live to deepen podcasts audiences. diversified more from in our so documentary as forecasters engagement, Disney [indiscernible] We connections history podcast not taking also increase streaming and users. film Punk our delivering user team production the of the to celebrities Band, of the and life World, core our Joyside and Rock the participate all walks live podcasts, to invited interactive, experiences Edge comedy team, to but other groups the be thereby

feature the which XPeng in operating first for streaming live Additionally, in-car system the in-car the also implemented the Podcast smart the podcast is been LIZHI on forecasts Motors. scenario. tried scenario, in-car live first This time was have the streaming of unveiled

interactive product We in-car podcast usage LIZHI usage as our in that more podcast podcast with so to scenario users users. integrate expect diversified mobile to immersive offer experiences enjoy strive for to and innovate podcast connect in-car well. can Podcast and the experiences our We

Chinese note Store by on pleased LIZHI podcast earlier, making one several to App Podcast the of We days are recommended that first Apple's the apps Apple. featured very became it app

and development our of business, further also in-house application in in first development progress positive the the our from quarter. to the we technology advance Aside

DOREME support the time the our provided Specifically, The by the streaming in-house our solution technology been business. live applied LIZHI has project podcast infrastructure Podcast. provides to in-house is communication, to feature launched RTC also of audio DOREME more newly technology which technology real

technology application and a also time scenario, experiences great audio we an addition space. business enabling competitiveness of We the growth. audio real DOREME a spectrum In increasing in-car share quarter both online for wider interactions of to depth our solutions, to capabilities effectively kicked technology business technology comprehensive on our podcasting summary, future, devices users listening focus through to in the continue better start propelling achievement advantages the audio year. audio of on are the and improvement, have first audio technologies interactive plan our further internet. years. mobile to live and the one consisting believe off to in This implement We our technologies. LIZHI’s believe and of a is our that we other of allowing stable our key the Furthermore, remarkable in-house development the in business the quality filters, the robust streaming communication in over users while to support that developing strong have research smooth In of

our building Going ecosystem. competitive committed audio we to forward, and remain enhancing

continuous product drives We across drive now audio leveraging globalization a ultimately create basis audio service community, execute to our business will devices. our our Ms. everyone. broader networking offerings our financial by Chengfang the strengthen development growth range will who I of our turn our capabilities, expand the advantages over in Thanks to will detail. acting audio of more results discuss an and platform social our Lu, technology strategy that, CFO and With to call

Chengfang Lu

Hello, brief results our Okay, thank now you, XXXX. Marco. of the quarter everyone. will overview for of a financial first I provide

are to First, of strong quarter first very have pleased XXXX. the we achieved top-line in growth

Our by robust capabilities. a continued a including our competitive was community audio to and efforts UGC advanced vibrant driven build commercialization ecosystem, growth

brand propel all and XXXX. in business, growth expand through increased In XX% period our In we to will revenue the our our same net addition, to our first of as we future. LIZHI equity, RMBXXX.X Podcast million total overseas of have to believe the the and boost TIYA, by which quarter, we footprint enhance business our audio in-car from strategically

as capabilities RMBXXX.X first continuous represented business and XXXX MAUs our entertainment in quarter user XX%. apps. of increase audio our which of mainly of Our The year-over-year commercialization and as million the to well base the to was pay revenues in contributed due growth growth net enhanced

first due of year-over-year generally of to XXXX sharing advertising podcast payment Cost in increase XXXX. an quarter handling revenue RMBXXX.X the in advertisers. in XX% year-over-year of which of the quarter our and revenue with first and to to are Additionally, in million XXXX. increase line of costs company's creators quarter in million in by to the business. growth mainly RMBX.X The due RMBXXX first was bandwidth fees other the grew number compared of content the increase revenue was million increase the to the mainly costs, was The

increase an Our RMBXX.X the profit million was of quarter representing of gross first the in XXXX. first RMBXXX.X quarter XXXX, million from XX% of in

XX% the Our was XXXX. first And of quarter XXXX first Non-GAAP gross first from for million representing in the to profit of XXXX, quarter increased of RMBXXX.X XX% an in XX% margin of quarter gross year-over-year. the increase

increased XX% expenses marketing XXXX, were primarily representing for RMBXXX.X of of compensation representing million of quarter share-based expenses in of the quarter RMBXX.X grew share-based XX%. to and year-over-year the the our XXXX, and in XX% the the in decrease increase in to declining the XXXX. in growth from benefits. in RMBXX.X miscellaneous RMBXX.X XXXX. salary decrease in As the the non-GAAP and The XXXX. quarter services increases million and products compensation XXXX. to were are gross of of margin development XX% year of quarter Research RMBXX.X Operating this decrease Selling in the quarter and of first the quarter RMBXXX.X expenses by expenses research due well representing from expenses XX% XXX% investments the first decrease million of for brand a driven quarter first first a decrease marketing our were third-parties decrease first as and administrative of name. increased of a million first million by to first The welfare partially first The expenses related other mainly was and was of to year-over-year expenses, XXXX, in attributable mainly by by quarter million and provided were offset as Development General an branding expenses. from in

quarter million RMBXX.X million of first of compared in was ADS of RMBXX to first loss by in up ADS in first loss net million and Non-GAAP million of year-over-year. first first the quarter was per RMBX.X RMBXX.X in quarter compared RMBX.XX up And XXXX, to was of basic Non-GAAP diluted the XXXX, the loss basic the the to the compared year-over-year. per million were quarter operating Our first of in our were XXXX. the XXXX, XXXX. compared ADS in million net in RMBX.XX loss by quarter of XXXX. first diluted was RMBXX.X XX% the to quarter quarter XXXX. first operating RMBXX of loss in RMBXX.X XX% per Non-GAAP RMBX.XX and And loss quarter net net XXXX,

short-term cash had and equivalents, XX, As as of investments million. we March of RMBXXX.X cash, XXXX, cash as restricted well

building audio consistently Looking growth. advanced leverage we our our strong enhanced and ahead, to operating solid committed and deliver develop ecosystem remain capabilities global long-term technologies brand to further to and

remarks today. we questions. concludes this open Operator, call Okay, will to all please of now our prepared ahead. And go the

Operator

Thank you.

your the repeat English. you then merely ask of will one and a to please and sake next call, all question For management clarity question order, for your benefit please the participants today's And on follow respond to Chinese, if question question. in wish time. to at free Management the for ask feel us of in

question. Vincent today comes Company. question the Yu line first & from of ask Your Please your from Needham

Vincent Yu

a Thank have questions you and quite thanks few I question. questions. management for Actually three taking my

management the are one, players on industry. content investments, about user the per My accidental - start are much to we make third app, overlap metrics is, in demographic of user addition likely talk XXXX and question of LIZHI's how be the that other on Can world is, and point management us the would they investment The that in Podcast will LIZHI for share size metrics affect sense content and My focus like by remaining margin? with increased looks App in the second app. LIZHI seeing of and management to do how spend in LIZHI they first some can user or question time give can a management is, the TIYA day question demographics. more

Marco Lai

scale user strong for our achieved on the reached the and In Okay, compared engagement with Currently levels higher more on base the Marco. user are and quarter. focused the quarter, a TIYA. growth first I'll user we translate the prior engagement

interesting Based reflected was user topics and created connections chat tried user user this base. December of by the higher a the of users growth room the wider topics, of XXX% user on created First, signals which our spectrum XXXX. number engagement interactions using various and from improved friendly by a for increased at and

both the base with new lays the the hand, Currently, was the on of noticed more vibrancy user the users launch the of which penetration our also as user engagement in well growth On we group other enhanced gradually drove segments. TIYA various and user function, in that emphasized the of as group engagement.

home to We also are our of with entertainment the needs further social and and dedicated innovative to users social providing social audio-centric the diversified products scenarios while the the popularizing younger generation. functions, satisfy

Therefore, user effect. not key moment. We user focus optimizing the our is the on actually commercialization to network product also Once stronger experiences remain based at and exploring committed a achieve feedbacks base updated on also our of different will scale, implement market grows stages product keep we the developments step-by-step to regard. user the in commercialization a any will of this certain intent we and based to

second LIZHI of higher LIZHI significant particular Tier Podcasts user Tier a the In and those in difference actually base LIZHI groups gender X the user LIZHI proportion cities between China The App. Podcast and from question is about of is Podcast. a a distribution. users with of the That X the balance of features

aged our of Additionally, This and is is ages users reach by we application XX user followed devices XX cities group target XX. aged which that through we is scenarios. multiple line the to Podcast almost originally to XX ended the users with to target intend and the LIZHI in young to higher, and across in top-tier middle proportion

April, demonstrated also LIZHI daily minutes, groups App. spending much our of user content a XX increasing the higher user is per average which new in an are competitive to LIZHI stronger time than the and user podcast feature interest Podcast we we early offerings, activeness. further the new remain and only podcast our reaching unveiled podcasters relatively a user to LIZHI the user time where Users However podcast real which in between about usage of subscriptions other podcast market. level bolster the new including In interactions audiences with seeing our metrics from engagement these enhanced

investments further we aiming limited targeted believe diversified content mass year to and is also that to our focused about profitability. will Overall, Chinese offerings, is have towards will Podcasts the and Looking high a this third the quality question library ahead, impact innovating our features. the continue market these make of Okay, propel building our continue tend the while LIZHI development aligned with company accumulating platform investments industry the impact podcast on we

App offering. in relatively cost offerings, discover organic the and LIZHI our leverage content AI First, unique growth advanced to in spur low content has using Furthermore, we can a high it content our UGC as of distribute terms the the UGC can community quality technology.

have LIZHI of signed. the the Podcast the radiate podcast well App range, from content content addition, offerings podcast offering to exclusive LIZHI extent podcasters as we from as In

creators the for have podcasters some our roadmap more the adopting diversify our potential, copyright content to opportunities contraction we including we with future feature, their on own Blockchain strategy to adopt regard, inclusive forecast technology more So In platform discovery some launching content the podcasters development. more strategy cost providing structure and will innovative great podcasters for outstanding with to more and and for optimize the attract cultivating investment. this attract

podcasters the developing structure will to our for control devices, all about mature indeed to the the other podcasts applicable and including step have actively reach space audience cost it’s have attract our and we’re step. like base, addition, I in-car enable moreover, gross on we help for ourselves better to margin the variances optimize podcasts structure by new and cost the smart expanding to and and cost believe platforms profitability broader strength roadmapping scenarios so minimal differentiate can In other scenario from investment grow. us we while a that Overall, that more business content optimizing strategic can

Operator

the And your Wei our from comes Citi. line Please next from Vicky today question. question ask of

Vicky Wei

for margin of the scale taking about question. for My the good Thank its is the implication So management. you. question investment Thanks profile? and podcasts morning

Chengfang Lu

Vicki. you, Thank

with strategy across Let investment multiple marketing. about Actually, increase launch to the of bolster first our the application, product, quarter, some new along information and podcast devices me in the our share and question. in branding this will

to marketing We quarter. relatively to prior in also invest the But which quarter, in states. still is selling expenses led increase as this this markets. small clear lead expansion All our and in loss overall to overseas are an net the compared investment to in going

and long-term overseas, be and general, margin short at beneficial a will impact creator on our time. counter it diversification quarter. efforts higher paid Additionally, established will as close at attention it overall before, local promotion on our some as we more also operating and were our resources, believe compared increased is But of our on limited. our investment diversified plans, the the is reputation, our additionally, our the have limited towards overall stage long-term for But offerings based the can every among users, on we awareness LIZHI always development think which also to company's these App, in I investment costs has which our some And, we growth. a business in content layout help podcasters content and realize mentioned of impact prior future, inclusive In the the brand podcaster a efficient on for have podcasts, we least the margin. we likely acceleration including signed Marco I to company of brand focused

enhance So business efficiency. overall diversify adjustments each in and dynamic we’ll optimize future to operating segment and cost for undertake Thank our podcast structure further you. metrics

Operator

And go Liu our line from ahead. of Crédit comes from Please question today next the Ivy Suisse.

Ivy Liu

think we Thank technology growth you. taking business Could the one color to DOREME LIZHI? for I for feel longer-term, will on quick the thinking have the about Thank And here. continue some have how management we my project. you update on development a question. do

Marco Lai

Okay, I'll translate Marco’s answers.

a for DOREME provided infrastructure in-house optimizations. the developments audio our audio in-house In technology. providing businesses. DOREME The technology project. online also quarter audio our DOREME we the great real project about first technology is time support the question developed first The progress to is research audio audio and achieved more on and solution features,

also of time Podcast and addition the has stable Our technology supporting to applied have tailored configuration mobile in LIZHI in-house the streaming for particularly future that scenario in-car streaming including echo live live of devices to audio sound audio further podcast the with also from we quality improve transmission the the audio the ensuring suppression audio been for feature to scenario, because forecast smooth competitive the echo the made development sound mobile the optimization suppression the is use, and technology. devices with system our delivering different and like effects in-house thereby effects transmission in a in-car the quite in-car user experiences with real

to Going a users. future to our in-house we technology provide development technologies use offering efficiency to other hope optimize more that to third-party and to because technology to personalized us in-house able for upgraded forward, to DOREME platforms, project In apply technologies disclose project, growth personalized users DOREME experiences further optimized actually, operating in-house technology the instead on technology long-run, audio our the business achieving and third-party we experiences platforms we’ll continue the our more advance business will market structure it’s might be empower while hard have we besides lines. also the the our in to also competitiveness and for the true scalable is relying of more cost in our the our in-house and audio when to we bring provide

Operator

Haitong. from [indiscernible] of line the from comes ask today question. Please question your last our And

Unidentified Analyst

have commercial my regarding plan for App? I quick translate focus for management for LIZHI your future and Thanks. how question. myself. question will I a Thanks to especially taking

Marco Lai

our I’ll Thank Feya for strategy. translate Marco. you, The question is and about

tend the footprint technology more to So firstly, growth strategy consistent, of growth our continuous business. based and do potential the create only be will advancements our overall through and of we overall our be diversified will drive infrastructure to audio on the

potential first with UGC grown from audio average Firstly, users abundant App a mobile which most which our creation, views LIZHI the audio overall further features, the we’ll community pre-recorded the of App segments entertainment values App interaction. increased by in the has in our and flagship to engaged diversifying to the enhance achieve audio then our and the product cultivate also wide will of continue ranging our combines entertainment entertainment segments. sharing LIZHI content in content audio for further XX.X leveraging that indicates audio also content integration improving In content paying comprehensive highly strategies, boost top that remains the audio line generated solid we Meanwhile, commercialization tools the and users into community operational growth. user quarter, LIZHI of million, conversion to the the penetration providing and

Our in expansion. for stage provides the the and auto support experience sets widespread entertainment global years of our

business overseas era in Podcast, very business for great multiple TIYA podcast in opportunities the in experiences market for online leverage the As and value. opportunities for mentioned we’re also also earlier, capture the expect we’ll improve years operational our full-year. the the strong more provide auto line in Meanwhile, of continue continue globalization expansions, future achieving user for the application and think I across our more further top growth technical our we market and more confident market. provides stronger the building podcast we innovation development will We’ll continuously business and to poised podcast have our global creators. growth of of strategic content systems. continue the upgrading auto podcasts In LIZHI’s the markets I’m industry, more implement create LIZHI and our podcast technical potential to footprint. with App With advantages to potential better we’ll we’ll LIZHI boost devices. vehicle developments. products the and capabilities our Recently, companies drive our in auto more and the summary, ecosystem provides discussing been opportunities collaboration create the to experiences in it electric the

Operator

to that like back concludes remarks. closing I’d Due session. company to question-and-answer to call time constraints, today’s the hand the does now for

Effy Kang

us joining today. for again once you Thank

further Investor you please Thank to free Relations ir.lizhi.fm or website Relations. Group our you. LIZHI's If contact have Investor TPG contact questions, the feel our through provided at on information

Marco Lai

everyone. you, Thank you. Thank

Chengfang Lu

Thank you, everyone.

Operator

call This concludes conference the today.

disconnect your may You lines. now Thank you.

Sound (SOGP) 2 Jun 212021 Q1 Earnings call transcript