LIZI - Earnings call transcript Q3 2021

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Operator

00:02 Hello, ladies and gentlemen. Thank you for standing by for Lizhi Inc.’s Third Quarter Twenty Twenty One 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 call is being recorded. turn of over company. Capital now Effy your will Head Kang, Markets I the to call host, XX:XX for the go ahead. Please

Effy Kang

CFO, Lizhi today released our XX:XX and and Participants operating Lai; twenty Ms. include conclude our much. on Lu. the very Newswire financial and are Founder earnings Inc.’s services and Marco available via to our XX:XX will Mr. earlier Li; and COO, one call begin We today’s our with Thank twenty will they third call. CEO, Hello, Acting conference Chengfang Management results remarks session. quarter with Zelong Mr. and and a prepared Q&A you will welcome everyone call online.

a As conference this reminder, is being recorded.

Harbor presentation conference of U.S. expect, similar target, highlights statements today’s note the webcast believe, under such addition, will, typically discussion may, provisions These ir.lizhi.fm. website made continue or on available please contain our call as potential, of be contain section Five. Before Litigation Safe forward-looking Private and this of Reform estimate, of Ninety IR our that will XX:XX the expressions. at earnings the replay the words Nineteen continue, will Act we In other Secretive intend, statements

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

Marco Lai

the users base, are focused support million and quarter Thank grew [Foreign our share thickness you development our We and MAUs quarter line. fostering and XX:XX COO user [Interpreted] thousand to business and strategy. quarter. to one each connections and will on eighty sustainable joining mobile user Hello, Total increase our to strengthen in growth. strive ecosystem audio Overall, global average one. remain nine twenty nine by twenty today. I everyone. to and see us audio fifty five average of continue entertainment seventeen monthly entertainment improving point business paying reached [Interpreted] our user million. delighted competitive MAUs the Language] point for third operation third details to Mr. eight Lizhi more will of Li [Interpreted] third future the on audio hundred year-over-year XX:XX XX:XX overview mobile ecosystem average Then in community provide four experience percent build twenty Zelong the the was audio-centric We

our in execution with potential, effective we presented As operational the audio commercialization business, unlocking entertainment prioritized of coupled strategy.

first quarter surpass one our and Pushing percent twenty. of revenues third twenty for revenues full year to months XXX forty total Our grew million. twenty revenue twenty RMB to the of year-over-year by the nine the for

priorities gross of of future. pleased our year-over-year. grew our thirty addition to the percent XX:XX the five margin, overall with near terms [Interpreted] revenue expansion growth, in In up continued points we hundred strategic which to are basis In

era, and audio-centric interactive localization prospects. supporting social architecture. continue With quality product strive more capturing ecosystem to valuable the growth commercialization capability time, ramp underlying community high a by XX:XX to community. more strengthening digital teams, technology stage, optimization needs audio develop to content a enhancing and to area. to [Indiscernible] and in strategy our At networking our our providing main At [Interpreted] First more we globalization the opportunities innovation, we creators stage build current in in for of is content and future optimize the grow respect and and meet all, our devices. we'll audio this Lizhi’s users sustainable roadmap scenarios, up are product same focuses our current At

In more audio market. to addition, to in-car reach the establish collaboration with continue we in tap-ons expand our

and long-term development to devices. the In system empowerment our our to MAUs will addition, in-house technology solutions technological apply pathway to with we further adhere audio developed more

of Beyond are IM development is the our stepping the we Instant which technology, up technology. in-house Messaging that,

We are our technological tailored various [Interpreted] In XX:XX more confidence expecting our prospect. have to support we in products. conclusion, provide great to

execute to continue maximizing our globalization next will We the phase advantages. Lizhi’s strategy in by

globally everyone. will our development. potential Thanks, long-term our [Interpreted] who our to the sustainable that, discuss and turn expecting now over are I With development We detail. in Mr. more call shift XX:XX greater Li, Zelong growth will business to unlock COO,

Zelong Li

[Foreign you Language] for XX:XX [Interpreted] Hello today. joining everyone us and thank

capabilities involves key to to Next, several working targeting. more with categories. across optimizing are our our detailed refine To pivoting [Interpreted] by user product efficiency, more our focus and to employing commercialization refine a to of productive XX:XX update we provide the like each precise operations, Starting functions and content and further line. our audio harnessing would business, we which community sustainable entertainment I'd business aim ecosystem

on achieve heavily global rate operational these as us for solid ultimately believe a to Moving solid people. ecosystem with grow our enhancing networking and efficiency lay and foundation for enable young now, optimizing steps categories and digital commercialization will to channels. their we for a strategy user us taking We sustainable strong growth. a pay [Interpreted] to content business, long-term positioned XX:XX is performance improved commercial China platform social our important Focusing our capabilities, marketing that high

optimize and functions [Indiscernible]. quarter, improve of interest, operating habits, features third their to the a among product local position concentrated needs based user wide range groups. building ourselves our overseas to on and and business In to for continue social development and on our diverse we their with different meet team scenarios products We in

status Our emphasis users achieve channel. interactive experience to XX:XX our retention users a organic online base status platform. smoother our guide tools discovery friendship the particular, users and is more to micron product for feature App As we their bonds feature growth. find allow similar and to of different on mood, the experience. which to ensure strategy, that part offer interactions upgraded to on reinforces [Interpreted] own a social an from status platform In brands features and designed on user the Tiya the user in We launched allow now optimization adopt we

Tiya to continue roll-out We features to innovative App.

new interaction user percent with the for and added active the In the increase time rate per engagement interact recently we users friend broadening users in product near to in also screen number XX:XX we user seven to with we In [Indiscernible] we products of and socially average continued to the daily these and users of continue be upgrades, and messages by further, that spend to options include was [Indiscernible] the term, optimized launch. refining thickness improve both and the to on to sharing users which friends, the deepening well for our in third enhancing and a provide lead June, with sent of our user newly metrics of priorities after of habits and the quarter, four average grew Some market the in interaction collaborations Tiya paying fifty platform. metrics Tiya. user ways September, by compared for the calculating auto route activeness will what this [Interpreted] master observed platforms. We number such strengthen podcast our pairs footprint user sixty In encouraging even relationships expand closed companies percent the these as and key than will June. higher attention levels on

also technological controls, competitive scenarios more technology structural application stimulus market. wealth product Currently, pleased companies. in recommendations including optimization in-car have income connectivity. around major podcast for strong capabilities XX:XX are that and auto achieved innovation, strategic [Interpreted] the We We our performance such and we as boosting a operation functions official are audio voice activated the focus, our from

In provide have stimulus stimulus connectivity peak to uninterrupted technological innovation life into and integrated platform supports the expertise a in-car two-way recently solutions. out optimize in technology been streaming first users, becoming A multiple that this we China, through connectivity our of rolled vehicles. our continue to scenarios. as will action that launching the we believe technology, are enables a in-house screen stimulus first devices one and [Indiscernible] two podcast feature. connectivity audio mobile life instance, connections ways experiences key ecosystem the in the in-car streaming product market. innovation competitive podcast we securing achieve For and platform We podcasts cross in Through podcast. technological These to to future, to first between audio

is goal to core in on XX:XX and have have podcast companies we satisfying our while the and improve the awareness applications expenses multi of for technology set demand more future IoV third the and differentiative tap development. accumulate Our [Interpreted] auto experience quarter done the technological of achievements the for devices platforms. In date of summary,

now to the turn We we [Interpreted] in success audio audio results everyone. long-term are who acting more for financial globalized and in optimistic CFO industry, building leading growth the call that, working XX:XX over opportunities I our Chengfang our continue With discuss will will about Thanks will Lu future the a details. to platform.

Chengfang Lu

Okay. everyone. hello [Interpreted] Thank and you XX:XX Zelong

fundamental year-over-year First, basis another long-term gross by we thirty the improved year-over-year. operational hundred quarter, up entertainment are see solid margin is to will driven growth the pleased ecosystem our percent very We believe built audio in to grew revenue five growth. strategy, our points third to our

six are exploring sustainable capabilities international order optimizing in will business. and expertise our Now for eight [Interpreted] we XX:XX by Looking brief benefits line I'm twenty-one, results in-house seven business we our Enhancement of quarter, representing percent profit eight quarter RMB In twenty a hundred an twenty million the market to fifty percent commercialization RMB quarter our hundred continue quarter percent RMB increase forty point the to of commercialization products. twenty technology capabilities as our one. XX:XX revenue year-over-year. growth. to one and sharing in one in third leverage hundred total year-over-year. million users gross welfare Gross achieve to or one our revenue of paying were actually, and third million an and of increase and of the increase and representing three salary which fees point third thirty [Interpreted] providing audio [Interpreted] and and creators, third representing primarily Mainly entertainment overview we bandwidth point were twenty sixty audio five Cost entertainment innovation growth. financial content of revenue ahead, of fifty one net XX:XX was costs, an was the the driven three year-over-year, our of expenses increase with of attributable three four for our

Our promotions point RMB Non-GAAP sixty of of Research the one eight five RMB of by year-over-year. hundred twenty gross of was third quarter increase twenty Non-GAAP fifty Our representing in the increased to expenses million twenty increase one five And twenty. nine twenty point margin seven activities. in to million year-over-year eighty The hundred quarter million operating of twenty the staff marketing twenty. a expenses of in development of point profit service increased [Interpreted] six in was RMB the one ninety eight and point twenty. seventy percent. point for twenty to salary. RMB nine and from quarter of point third marketing third of increase one a welfare research primarily percent expenses one thirty the four point compared were administrative fee. was third of twenty was of quarter quarter in twenty quarter RMB This in XX:XX and twenty increase five twenty mainly four twenty [Interpreted] Gross twenty million quarter increase point twenty loss percent to the versus one salary million million third increase the two professional twenty three for third in [Interpreted] were one one percent twenty increased and XX:XX from of quarter related due expenses and [Interpreted] twenty to million development the in compared twenty twenty, and in year-over-year third RMB percent salary the third average benefits an ninety third RMB thirty representing third quarter fifty benefits and two twenty quarter to twenty and increase to gross one twenty quarter RMB twenty number XX:XX and XX:XX one million percent expenses to the twenty seven percent. Operating General percent our XX:XX year-over-year and of three grew one of increase margin Selling increased in twenty quarter in one twenty. The of forty the our welfare was the third due one in one. were thirty primarily other one representing to [Interpreted] due of third

point twenty. third of quarter RMB one was two two loss ADS of was point Non-GAAP zero net twenty compared twenty third twenty. point point Net in nine the in and one point twenty seven ADS net per in the compared [Interpreted] thirty one diluted quarter XX:XX twenty the RMB of of quarter twenty [Interpreted] twenty Non-GAAP point ADS zero net As in four twenty. million the diluted third compared million compared RMB to of Non-GAAP quarter per seven XX:XX million RMB twenty quarter six one was quarter third third in zero basic per loss of point income Basic quarter quarter compared million one third RMB point zero of in RMB loss were and of six of to quarter Non-GAAP the RMB and RMB And to seven basic zero twenty net three the three of RMB operating third third thirty twenty one one net to in point in Non-GAAP one income of point twenty. five twenty twenty third million diluted twenty the twenty in one twenty. zero the loss RMB were twenty

nine cash open twenty the please Okay. we ahead. thirtieth all [Interpreted] fifteen our had hundred twenty concludes today This As cash we one, million. and five now September and and cash of go point to RMB and restricted will equivalents Operator, call of remarks questions. prepared XX:XX

Operator

today’s Instructions] we ask XX:XX English. now Thank participants to gentlemen, you. repeat the and in session. you question-and-answer management's on call the of questions all your Chinese, begin For benefit would Ladies if your please [Operator immediately to in wish question

up at next free feel clarity of will the please Management order, and with one respond and your For question. ask the time. question then sake to follow-up

line of Vicky Our of ahead. Wei first the Please question go comes Citi. from

Vicky Wei

regarding [Foreign the if and my impact user Under for Language] XX:XX user spending to The morning growth. or management. XX:XX Thanks growth you. spending? and user needs user taking regulation environment questions. My challenging [Indiscernible] question is and Thank the

Marco Lai

recent the mechanisms [Foreign I like think digital translate long-term environment gain we companies advantages. but two it's Language] is tightened, more regulatory more given for [Interpreted] industry Marco. of ours, from to development the The XX:XX will entire the operation and we beneficial getting content standardized especially

metrics level This the in operational these you. operational regulatory quality also run, XX:XX meet for third confident as have in through monetization actually which content in foster By on quarter, overall strategies operations, adjusting paying we This products. products top spending cap on requirements the long-term focus the growth some confident commercialization with we queries services potential adjustments further and on and improve further In to increasing on providing affected users. higher and slightly, those longer-term user efforts XX:XX monitoring our overall quarter, decreased [Interpreted] more Thank efficiency. our both temporarily pre-recorded answer. while user terms marketing the third enable potential. changes for spending a the XX:XX factors In the back focus was such categories compliance the we also investments the are maintaining optimizing base to spending more may [Interpreted] and of In base. precise, with certain are the my strategy. the the with it user optimization the and relatively short-term, the [Interpreted] we while we stable more may commercialization terms on tap-ons user long lower is us of user and potential and In are user of battery we line began our including content and content operational reduced by earliest

Vicky Wei

Thank XX:XX you.

Operator

XX:XX you Thank questions. for the

line Vincent will question of come Co, go Yu from the please Next Needham of & ahead.

Vincent Yu

[Foreign take Language] the taking you will I three have my we XX:XX [Foreign Thank question. questions. Now Language]. management for

[Indiscernible] user with how our on optimization about our are that been ratio we the overseas and focus size current on is seeing from question in witness have like causing trend the share this on share looks on are has and first information improving done we results and and Thank and The details two, some base expect question you third user growth insights twenty revenue second done sharing can are we the the raw have end more have the twenty in in And strategy and change more on that business – we revenue two. product management the captures is also share we seeing terms as our as will expect content can business in to on pain the we you. a should contribution base such questions we seen growth what well. what of should what sites twenty user on product declining

Zelong Li

[Interpreted] Zelong next priorities of pain strategic translate respect XX:XX we With the I Li. growth two Mr. actually the for Language] ratio, [Foreign in will have to stage.

hold throughout of activities First we our through entertainment strategy users the types focus including promotional off user enhancing engagement all, order business between events and will improved the diverse host. and participation and on operating the level, lowering at activities and

strong users and of [Interpreted] categories creators engagement will rate. and segment we potential materials. better also entertainment and the start segment, on categories user On further [Indiscernible] will exploit the content monetization user conversion audio marketing pre-recorded and and focus other optimizing As in terms to promotional and strategy, paying the model potential XX:XX the out attractive we interacting improve commercialization with the in per hand, higher with cores

We groups will precise ability pay. reach on user and execute to revenues to strategy user with strong core acquisition

user the expansion. that improve confident base, So question The second effectively increase paying is overseas pain as are overall overall the business the about our to we ratio. XX:XX [Interpreted] [Indiscernible]

as to we spent the at around attention we metrics the in long-term we will functions future, users layer respect user’s launch to our continue of demand, interaction So, foundation term, our and near as XX:XX marketing an timing. to user current new aspects also with product to Also, organic growth. will user to the engagement of waters of take In focus, and tap our driving optimize appropriate by the of have such In multiple product experienced the and features we experience products commercialization levels for social more the step functions. and we time optimize following user constantly and meet spend ropes time the more the the features launch including solid innovative [Interpreted] increase integration growth. key step user

expect slowing business, For stronger the in believe base the growing mainly order us user build us business the about We the is curve. potential size. with overall to our impact. growth XX:XX user on [Interpreted] more the second network base driven and commercialization expansion that overseas will bring but quarter entertainment the and longer the short-term We be and term the in growth revenue by a

in So because quarter. optimized mainly strategies third of for that, it's our because, the

year, In with segments. more promotional content – pre-recorded audio with business operations categories have capabilities. reduced to the business, be total we grew the impact continue adjusted last relevant year, the commercialization third also down the to our primary of opportunities growth provides entertainment overall to although audio targeting quarter, And strategic entertainment line by base business to ratio percent commercialization entertainment slowed audio our we to lower and which next [Interpreted] in to twenty growth. the content it user we user foster the the adjustments one XX:XX will that our our like the the of certain did related expenditures our of refined and our operating for improve growth line model, audio weak the investments content commercialization our MAUs targeting the top In from entertainment promotional optimize year-over-year, the and last short-term. We marketing from driver growth. commercialization strategy the believe the XX:XX made domestic we paying content top strategy Accordingly, So pre-recorded potential choose of in are to with business. the [Interpreted]

with That [Interpreted] our we business could growth that the digital also of concludes Thank development believe business, XX:XX the addition, answer. out overseas social more you. my networking In opportunities. bring

Vincent Yu

Thank you. XX:XX

Operator

for you XX:XX Thank the questions.

As further there are questions. no

company call for I’d Now, the to remarks. closing like turn to over back the

Effy Kang

you today. once for Thank XX:XX again us joining

free If the further contact the or ir.lizhi.fm information at Piacente feel you. providing Relations through please you Thank have Investor our Lizhi’s Relations. questions, on to content website Group Investor

Operator

XX:XX This concludes call. the conference

lines. you. You may your now Thank disconnect

Marco Lai

Thank you. XX:XX

Sound (SOGP) 30 Nov 212021 Q3 Earnings call transcript