BEKE - Earnings call transcript Q1 2021

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Operator

Hello, ladies and gentlemen, thank you for standing by for KE Holdings Incorporated’s First Quarter 2021 Earnings Conference Call. At this time, all participants are in listen-only mode. Today's conference call is being recorded. I will now turn the call over to your host, Mr. Matthew Zhao, IR Director of the company. Matthew. ahead, go Please

Matthew Zhao

published Peng Good website, Inc. good XXXX or company's on results call. operator. today release to are On overview Xu, our Executive Officer, Chief our call, and earnings have our Financial everyone. business KE Mr. today's Chief and The posted developments we were operating and an Holdings the Beike's company's financial Mr. additional the evening you, Xu press Co-Founder Stanley morning financial will Officer. earlier and strategies IR will Mr. Mr. and our results. Welcome conference in of www.investors.ke.com. details Thank Yongdong Tao first quarter provide company's Peng, and and on provide

include you our statement refer press Beike's to Safe we financial release information forward-looking conference will release, a applies call which that this GAAP unaudited as reconciliation continue, earnings release, call, Please company's comparable to in measures. as this of Please we earnings non-GAAP and statements. which to measures. make I unaudited Harbor our know press contains press GAAP also Before the financial the well as to refer measures discussions of unaudited non-GAAP

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Stanley Yongdong Peng

quarter our Hello, Thank earnings first on Matthew. everyone, call. you, XXXX today for and you us conference thank joining

pandemic for on consumer are well goal houses delivering the economic growth that speculation, quality as We from focus robust excellent the our the exceeded the adherence as to and of results the policy, COVID-XX through expectations, an tailwinds very for of financial in the service. are to long-term unwavering considerably and first quarter have grateful operational experience achieved China's living following national thanks not

was trillion, and rapidly our further Our driven by to total Meanwhile service efficiency of RMBX.XX quality scalability self-reinforcing platform. virtuous up cycle year-over-year. grew enhanced XXX.X% GTV the on

platform in continued We dictionary industry and network's digitalization robust further building Average million we by reached up our In WeChat our stores housing of the quarter, data while collaborations online remained completed end our In a platform. apps collaboration the first quality quarter continued stores XX% pace, contained XX,XXX, our total of also of over XX.X% our on were number on win-win stores China. listings. continued prevail remained scale cross-store mini-programs XXX on first million infrastructure. the the network. XX% quarter, year-over-year. completed transactions quarter, platform's By first through and Seamless connected and of our among including XX% in collaborations at the promoting of and connected for our XX% platform, at existing MAUs reached home the for transactions first focused expansion while through brands The XX.X on up accounted of the year-over-year. steady the to cross-brand homes

reached stores quarter, agents we XX% to mixed Specialization divided was end industry proven their Specialization effective and first allocation encourages existing part mechanisms. in well The overview, substantial rentals our efficiency, impact Agent transaction in strategy By on services initiated of in was of to of color recruiting, efficiency total with of Hangzhou XXX.X reaching transaction low existing with the addition, the foster agents the ultimately by we the business. either mindset promote would along their as GTV home like year-over-year very home service and the agents strategy, connected home in primary to and RMB agents With and Unit consumer first our pandemic a quarter, expansion. platform brands focus across stronger aided quality Continuously enhancing the agents different of pilot the example Agent Total severe among agents and efficiency Specialization that In in defined home transactions in customer the cities growth have we efficiency On XX.X% home home existing experience. rather first store our stores roles stores continuously quarter. the stores. Agent agent these this cooperative home quarter, structural existing as cultivating over some of to not of sales gains. helps XX,XXX you taking quarter, than that XXX.X% caused an the have achieved first the the which the the to in I in and which the billion offerings, growth store covering to in due was sales, improved number driver XXX.X% and improve at sharpen platform supported implemented XX,XXX provide cultivate was assigned as higher we the existing focus, experience This stores the our some first clearly consumer store robust of of commission GTV functions. implemented compared has XXX,XXX. new the a quarter. The XXXX by different in transactions an GTV grew capabilities, were the service year-over-year unit now traditional led gain mechanism efficient retaining China performance-based in and where of on roles first or year-over-year on functions XX strategy regional store in increasing of base transactions of In professional impact GTV conversion level. connected XXX% city

strategy encouraging improve contract in major processes, this the our we adopt estate for early began XX least the cities year. in further step consumers opening plan at transaction service results, value batches centers we and Given this order create In real to offline one cities. to in our

service and process to exposed and very of be process streamline Our enhance offerings often and signing legal and knowledge professional complicated further guarantee risk. finance, across the these of real that fields. requires contract The to the left parties. fill to needs consumers efficiency goal tends signing is transactional tax comprehensive multiple The security, estate lack transaction

developers' growth and as accelerate new service transaction this location China, the service of quarter, connected training the as continued of to developers risk empower centers governance. customers. low of such services contract our process financial last is content exactly performance, new-home service also strides stores increased services. centers with value our strong the incentive with to On professional go-to This and which by had provides for new was consumer. enrichment to and Our attributable home we service manager The stellar to year safe in the disclosure, as they as and sell-through. RMB quality substantial providers we to new connected enhance home the XXX.X customers and was XXX% enhance become By first our driven and our completed services. the first contract the made for for compliance XX in to year-over-year as the all for continue GTV full other XXX.X% GTV a professional billion pain well base address efficient ecosystem GTV experience contract-related Switching transaction regarding opened aims transactions and to ensure in up a convenient gears efficiency contract transactions par channels our contract agents. quarter, maximize cities. XX% XX in end the signing home to digitalization we In which year-over-year point

penetration, build dedicated quarter our As call, we during improve to facilitate and digital to transactions home are experience, segment's earnings fourth online transformation. online consumer we this for new communicated content the

layout assessment As book offering through content for our AI covering together such consumers enriched information. satisfy comprehensive home with as processing, of able plans, cities such March and home property multi-dimensional XX, and better than needs information new for more valuation online to we XX,XXX as AI-generated the projects sales and we XD consumers' with were XX and online on platform new online more reports data housing information platform

launched we the enhanced home XX% on all strategy. optimized leads quarter also increase in generated significantly leads on We Improvement to home in transaction first those customer new healthy a and average for for New in Plan new services. environment advocate cities a and consumers. the we governance new and our Thanks Conduct new to these a home based home traffic collaboration in better acquisition experience and online XX Home sales Business transparent initiatives, the sales Moreover, mechanisms

of overall developers customer and to them, information efficiency city-level sense agent certainty and rules and the create capability of security promoting customers, this protect addresses would place Our improper system the we including the mechanisms ecosystem improve competition and new verification the rebates. efficiency to as industry goal put supervision have Eventually, implement that income, at enhances the governance By existed that enhance efficient, time and forced industry. cycle interests a a is as agents' as substantially aim that practices we and offer well safe, rights protocols implemented to operating the transaction first the such agents' new of and the home in In and in to consumer the experience, virtuous and quarter, facilitate level a for long home for leakage, them. legitimate services a teams. for vicious a orderly fair, protect the

the on developers Five on Don'ts, agreements the and overall with signed industry. We to making our a have also developers commitment XX% firm platform of

needs For expertise better to purchasing the home focused initiative further agents By the online is home we when needs acquisition new offline home new new the sales portfolio the another New the existing their well consumers' plan Home with enriched same services customer to channels. cultivating caters as projects Empowerment efficient channels on Plan. more is dedicated offer meeting developers of different new At capabilities, with compared full-spectrum and time, homes, sales for homes. as important Sales transaction and

units on we self-developed system including in Among and first financial quarter, quarter. X.X Lastly, the them XXX services. in home infrastructure progressively steady BIM our services services, in completed We launched renovation our progress in renovation while iterating have the was first home multiple the self-developed systems. version made Beijing emerging Beiwoo

of and industry home system design. decoration Beiwoo the digitalized infrastructure, As part renovation the BIM successfully

not our designers of VR on materials, BOM, the For as of capability drawing generation the digital and the available BIM designer's highly the real-time translating only with by and accuracy. automatic final as of output, lays out bill enabled VR a designs the This foundation solves construction supported the quotations, mind, accurate design but industry-wide effects well the also abstract system enhanced accurate problem data visualizing platform. from feasibility for

including greatly them, reliability service the you that is see notion control on is the this we empowers infrastructure greatly For you products for take in what we the reinforces position the for platform, have providers. to renovation and We decoration, applications in systems, real-time, get" costs service industry-leading and enhanced. of consumers believe established our and consumers provide, and home "what both, renovation the

transactions sellers In end terms product strong improving of first needs average the home for recognizing for promoted we decrease home financial [ph] XX% quarter, in products a at transaction, of redemption, in in summary, services, redemption to overall demand the and is property of At owners' home have this a the meet experience efficiently In XX% seven the transactions. entered an to cities, 'Anxinbao' more start. existing cost. had XXXX off owners existing

financial we continue market 'houses our for the policy real-estate a home living, China. are the existing with core new spotlighted, mission, traction and added network has for housing industry ACN steady Our national support provides performance gain and and in in of and to strengths services speculation' for The foundation transaction healthy operational not transform our underpins markets. to and our that to

in and while core will like of closer turn initiatives our the way. we With close invest, normal and to call review to new first-quarter the increasing forward, I our value everyone better over creating our would along continually Tao, you. building that, trust for our CFO, for Xu Going business evolve financials. a industry, a for the to and Thank

Tao Xu

a I quarter joining provide brief financial for you, XXXX Stanley. everyone Thank for like us. our to would Thank first results. overview of you

quarter strong high of and are results, revenue marked pleased by strong profitability. We financial another deliver to growth

COVID-XX. net increased RMBXX.X QX, growth of to revenues revenues, year-over-year our solid guidance in XXX.X% was net base period of XXX.X% by rate under in the to by growth attributable street of both, driven of and first a consensus. was GTV trillion. year primarily The quarter lower the Our the of of year-over-year exceeding growth high The in to high-end same last XXXX the RMBX.XX impact billion rapid

GTV year in we both, basis, still momentum although on and by billion QX, from Chinese growth. mainly impact year-over-year However, of only existing the revenues a QX, in the particular, revenues our in New top the a QX. QX existing RMBXX.X in due services, XXX.X% experienced increased home revenues our net QX of to XXX.X% declined to Year home last sequential the billion transaction RMBXXX.X to year-over-year and of In in surpassed of net demonstrating strong line in increase QX single-digit transactions

Our services, transactions year-over-year increase QX. RMBX.X due net billion transaction increased to revenues to home home RMBXXX.X XXX.X% in billion primarily year-over-year to new in of a GTV by new from XXX.X% QX in

Gross mainly RMBX.X the QX. the Gross QX. Cost margin increase Our net to increase from administrative services increased in of revenues XX.X% to low-base billion, General was were mainly revenues, RMBX.X home an X.X% of attributable in in around of RMBXX.X well period offline million revenues of billion branding increased as billion from were XXXX. Income increased in in RMBX.X as billion, compensation compared of to expenses from same the of financial XXXX. billion loss XXX.X% and in due units, and increase in XXXX, expenses. RMBX.X an compared same the RMBX.X was well expenses impact XXXX, number experienced to of Operating emerging the XX.X% Company's operations by advertisement period R&D well billion to QX. The of to same the RMBX as GTV XXX.X% personnel, transaction an increase outbreak XXXX, gross the in were negative development to in online services the headcount primarily year-over-year in RMBX.X XXXX, billion billion mainly billion compared of quarter RMBX.X QX. XXXX. a margin in margin increased in year-over-year the QX, period headcount due due the X.X% the to of marketing period to and same RMBXXX Operating from of same year-over-year to COVID-XX to the was the in in to expenses. other and RMBXXX net in and due RMBX.X as expenses as of under same services period compared in decorations increased Research Sales outbreak. QX, compensation by, increase COVID-XX to QX, as of in same platform. the in billion to and expenses were increased was The last impact compared primarily and the million share-based in to million QX, XX.X% the of first housing operations the campaigns. of by profit through mainly RMBXXX share-based increase in the of due of increase compared XXXX, to period period completed

XX.X% of of QX, the in billion adjusted income adjusted Excluding billion operations same income to EBITDA in negative billion the the non-GAAP compared operating was our in RMBX.X to XXXX. same QX, in to of RMBX.X X.X% period in from RMBX.X items, of loss billion operations from compared in was of was compared XXXX. net billion RMBX.X margin Adjusted in XXXX. RMBX.X period same Adjusted Net to period QX, period negative loss in QX XXXX. the compared of RMBX.X was billion same

Inc. same was KE period in Net net of period per of KE RMBX.X income compared income KE ordinary items, in was same RMBX.XX of attributable was negative billion Holdings RMBX.X was in the Holdings same to net Holdings ordinary Holdings billion to attributable billion period the Holdings in income attributable to to net negative attributable to QX, RMBX.X of of diluted the Diluted QX, per in in Adjusted billion the XXXX. income loss RMBX.X KE attributable RMBX.XX Adjusted shareholders QX, non-GAAP in Inc.'s compared KE same in RMBX.X net QX, ADS compared shareholders of ordinary adjusted loss period XXXX. Inc. net income loss Inc.'s compared XXXX. to was in compared to billion same adjusted RMBX.X our ordinary net the RMBX.XX of shareholders KE Excluding ADS Holdings in adjusted to XXXX. period Inc.'s XXXX. net billion RMBX.XX of Inc.'s attributable shareholders QX, to to to

balance XX, our amounted to short-term RMBXX.X investments combined March cash cash US$X.X of or of and equivalents, XXXX, As cash, the billion. restricted billion

the mainly last QX meaningful from reflects XXXX, business Looking a by negatively XXXX. transactions net been versus situation the The and price, to forward last implemented our noticed progress. view to quarter we we the to transaction the in new in believe meaningful to due estate since and estate This for upgrade and a to for control conclusion, our the negative suggest a outbreak. short estate Nevertheless, which allow relatively been COVID-XX of the term. city-level housing impact portion revenue market, which regional QX housing at continue are development the revenues real billion We the XX.X% to the real and the year second high service the quarter on of in that of last condition, we customers of markets expect to which outlook first customers that investors policy overheated company's QX mitigate of from our short-term to the had to real the change us believe from business impacted bring more confident financial we demands for performance first Beike year of period an compare mainstream resulted market a Last, our in In of market in a rigid due is Meanwhile, low increase shifted to shifted during guidance stable whole quarter is year. impact may fluctuations view, and market-neutral business XXXX year-over-year preliminary of cities. XX.X% have the and with a few portion beneficial between attract subject to to first business we reflect of the and the had QX as the Since same current certain be least, of change. and RMBXX.X outbreak a not whole same but industry-leading projection. of half and half operation rate last of sustainable transactions will COVID-XX outlook our in that industry. billion, long-term to our look a is representing XXXX better our approximately year, cities remained base growth growth RMBXX.X to to

commitment us Our support service efforts, would like your open our enhancing will in ahead. in consistently consumers the remarks. realize That to value concludes please providers bringing and call to our vision. to now questions. Operator, go prepared to our the continue We empowering

Operator

[Operator first Goldman Instructions] from Cheng question Sachs. line Please question. ask Your of comes the your from Elsie

Elsie Cheng

management you, on Thank for Language] again. the questions my have questions. three I taking [Foreign congrats strong and quarter

where should tightening from if those First at in stores. the think impact is how the we think quarter? And housing the management one of to the the you on you. does is personal and growth the regulatory would be environment policies then macro GTV of about into more Third some impacts cities about our and the tier future growth, industry, Beike cities as trends? in color the for share Thank as couple for antitrust regulations any? efficiency How a drivers main Company a the Can Lianjia well we've bit and China. second is about what and seen and

Tao Xu

Elsie. you, Thank

the sequentially, quarter quarter-over-quarter per Beike average efficiency XXX.X% decreased first Lianjia for the and increased Regarding X%. our we XXXX, and GTV store store for store for the year-over-year

and XXX% [Indiscernible] Our increased X%. increased the quarter-over-quarter year-over-year has

regions increase the shut over mainly increased quarter safety our impact to so of year quarter COVID-XX, stores year-over-year XXX%, funds. business decreased of months down connected Our we due whereas for and negative to the COVID-XX because agents our last [indiscernible] all year-over-year, is of X%, outbreak, our X.X secure

is quarter to efficiency [indiscernible] exceeds weak million a first so the normally, housing number passed first That's QX, just QX of period to for the and played XX transaction, Chinese after out. so versus owing post-COVID New quality, New strong season just the quarter-over-quarter Year the XXXX though quarter stability then is impact back holiday. store RMBXX QX. big and we're this but and of traditional what and But the owing XX% Year, the single But you number million meaningful if at while, reason. other that's show more is Chinese million that's remaining the QX's and there this and During the much with to quarter -- main Beike we low meaningful a QX, the [indiscernible] had and QX's store relatively opportunity even look than because benchmark. still the very impact finance quarter did last not were store robust with QX RMBXXX is decrease

Looking increased We our means proprietary already our million forward, enhance XX% long number the and its million According store will to tapper our efficiency to in than will passed we to to the XX% will XX that more than to the pass new -- environment In That enrolled connected reached increase continue efficiency. XXXX the the reach to run platform home further XXXX anticipate bring year-over-year. network XX% the XX% as XX% stores XXXX by XX XX,XXX all more from XX.X% back. XXXX for of brand and of quality very this quarter. stated expect incentives this business benchmark. third this – confident in be in management store of and and benchmark. our business model are develop the given service we this will efficiency and The for satisfaction sale customer this

suggestions also ourselves same try sincerely that the Alternative Developed housing and ensure industry priorities. problem the the same so to made welcomes to we the the of efforts the supervision back that are by frequently, have to help Beike-specific insist encourage property to caused listing the contribution responsibility time passed grow At meet improve development – economy. To give -- and the a bounds this unpacked industry committed achieve of At authorities and consistently rules. we fix a and being have sustainable for run the no and development the investment to competition ways and dysfunctions confirm and the better time, in therefore is into very model plants problem questions will non-public government and housing of place can untied operate that business platform the regulation prevent to supply industry. mix take and is to work from the the have this and Beike with to digitalized and the in and on we as hard Preparations the industry past and to the public you the regulations of obviously the sectors in are our promote continuous industry. the what and the cost with environment. regulate based the need and the wish your get where striving rules automated customers and this we're of laws the house most But spare -- compliance monetary, Regarding the environment balance to be new society. understanding was preparation always promote years. within we safe-play over as and efficient morally the co-participant a regulatory regulations. recent government and XX even the demand brought and for the are We while grateful to also promote also guidance to that environments. social to authority house understanding the is for top

question your some for the and macroeconomy changed. Regarding parts third

livelihood about that conference for all key this and not housing space understanding living For market growth speculation for and measures is policy this to where the is steady promote welfare these housing year development market. and our their people's this a and

market for demands goal is perspective to we obviously raising out. conducive released of very the the in upgrade at policy be such housing doing growth and and market is based or finally the the this – long and run remaining the market willing will mainstream like of the for is demand gradually market words gross too a cities be year which and too released with all instead remaining of now their go with effectively other freezing done contribution From cities demands Shenzhen helped still have hope is cannot Also hot and market and government about into management is But macro for special we severe -- as whilst transaction beneficial see markets demand the not from been have directly we the cities China some of sometimes not operation months prevented and own to the should matter beneficial have some from for the most drastic this will operation. perspective, fluctuation what's to steady economy reports. peoples the in speculative -- the because market demand a curbing for will our of into that in break, it. long-term that on reasonable of this something environment with to all especially provide benefiting while stable market cold be the only the fulfils policies of demand welcome people post-pandemic in want prudent and to want So market peak need and prevent overheating align the Beike's market period. these of comps due volatility that the that and we judgment volume operating heat year put concession From troughs other forward a that fast regional we seasons. squeezing this this which it's introduced punish from Beike, to The to it new

like from So our perspective, for reckon One affected. excluding Shanghai nationwide GTV be we believe phase do transaction will is Beijing in Shenzhen. significantly this Guangzhou the not

market. The compared At neutral for Beike is rest is XXXX robust for demonstrated in and years supply XX very And foundation speculation. for platform that GTV not firm and into to that house So we Lianjia of of increased year. in best operation the a supporter of beneficiary our are XXXX proven a at the living also March. long-term deals was confident with to effect Beike March the cities XX.X% the the mix a metropolitan our balance has development the to on based generous for from deliver development. our results demand history national There and the of cost lowers

Elsie Cheng

you. Thank

Operator

Your ask your comes of Chong the from next Jefferies. Thomas from question question. line Please

Thomas Chong

set questions look the the more for congratulations as Thanks trend [Foreign half Can how of different solid comment outlook well second and My is the very on about trend Language] taking management for the about segments. my results. for GTV will half? the the management revenue we together question well like new emerging home with we as to services come the on basis and by-segment outlook trend think how the as existing should the Thank second as the the for home, about you. profitability as

Tao Xu

Beike you, Okay. after delivered the regarding for financial half has And IPO. Thank continues first the the quarters question three because Thomas. outlook, in second past highest record performance

forward, and for strong the of deliver year. to looking continue growth a rest So target have the we

XX% to increase of QX RMB Just due from revenue, billion RMB is increase. XX.X X now XX% we give which our year-over-year guidance was billion, an

going in price housing fundamental up of and rational. in So cities certain the fast policy XXXX regulatory very too purpose providing

Elsie, market living additions. demand particular the the So, we as housing to willingness in second to owing people’s the be question the to I our the and of saw the input resi just answered still change stable half will

So, not we it's transition we nationwide facts. believe do the see while a

our of for are the to rest give we the result to the first year. robust confident is This question. answer very So,

commission The our I second our regarding – a for rate rate. think is question and

promote gradually the X.XX, at exact any we iterate being home X.XX. example, as continuously efficiency with and a in offer. our market to it, So process... in transaction With house not may to the make our focus – X.XX. dominant owing on public justified efficiency part past from the sustainable, partners home facts I – time-to-time – to home questions. the the increase X.XX new price the have quality digital that Beike's years the – cooperation in China the efficiency homes to doing regarding the efficiency guarantees just to rate control number market, apparent initial new of during working service actively new we the the our quarter changing for service services actually and [indiscernible] position new new first commission the that home from that not X.X for more of announced is grow rates. to residential intention are of quality XD [ph] together and commission to new the past In and Developers home international continue platform X.XX the Beike and sales the three our issue future, new offered commission grows of think at rely years, we second X.XX by property a the our of we quality commission and four the rate, are jointly has capability these X.XX we efficiency, rate rate platform and commission is for to market. was years sales, X.X to transaction the still partner few does The offer and is home increase and will Today on market with the past number one. and commission service fourth quality which from and service Lianjia question from for buying your this this especially without of was and gradually while quality, solid the with the the rate to state to recalls, work we developers And is

important with these Regarding and the holiday and this over we for decoration and standing understanding and but the comes opportunity. of to first. the we total XXX. that is In XXX we decoration units Though of huge are some QX the foresee the is we which should decoration, our there project of New efficiency, the customer and in Year believe In in to certain market and with throughout XXXX. for complete market services units. XXXX, deliver number years still me renovation penetration service even XX about trillion XXXX factors in The to emergence the the is let financial count control Chinese complete talk impact a – very team the the big this recently control we China next process This doubled thing low quality. for opportunity. with XXXX unit talents the that renovation roughly and declaration, market compared This last the is RMBX.X back of is XX%, the about five into question your moves estimate

run channels think So have fragmented. very are especially that have inherent, I out quality, significant first the are we we acquisition, think help will of efficient we that year doing we

this in the So for larger related – related strongly we it's months. this to advantage very are from declaration to XX% are position good and funds [indiscernible] of strongly anticipate

In a powerful addition, online offline and we integrated have capabilities.

we'll think power offline powerful to periods. have have the [indiscernible] I and

meeting are business we improve. continuous to So demands need is our reasonably the and positive system

see and choice the the [indiscernible] you'll of In over run business quality we core can mentions price. fact operations today [indiscernible] the of realize in

have to this various the into cities regulation market you Before the new mainly the – is QX service fact is that GTV and have our other have monetization financial refinements our transaction see major the rate. providing the costs and fixed of stable financial our of growth ability presentation. was undergone services, financial adjustments consumers volatile. services monetization regarding service due rate been created. their our QX due service and to And And that of penetration home financial in our simple very mainly growth the This

and that complete transaction. as the of the saw nature we financial services these assist consumers how the home new As simple the transactions to with

launched a services. bringing scope especially have we financial expanded of some current financial the on as strategically services and in cities, our So

of So also from plus reliable actually free realize speculation. require that providing house to service for policy customers network to -- some transaction in is all by benefit are social wait of charge with business of line hurry we financial that service the for this part it's our offer very they project not and some to to and our living and not

continue [Indiscernible] and will activity customers. and support for new We them to home

Thank Okay. I hope Thomas. this clarifies. you,

Thomas Chong

you. Thank

Stanley Yongdong Peng

Hi, is Language] Thomas. [Foreign Stanley. This

me the our Let on in to new the future. terms philosophies in business add develop of

overall we look the there's renovation fragmented residential size in market potentials a or market some We we as and such at when topics there decoration. kinds new at When big procedures we be the always that as always always those the big some notice such extremely and those big overall the look in of potentials of rounding kinds market know well the firstly, they of business of will the So of as complicated. quite overall are common are experience as players quite user pain-points there's low service the have industries, areas.

to from So of experience Beike, the internet to the will transforming Lianjia past definitely the based routine. on practice the believe years our of go industrial we XX

doing then doing Firstly deeply, horizontally.

So doing we the into we new Especially the right? when way will dig that up and build industry standard only it believe deep the do that, for services. to it's understand we're standard means the deeply and

So couple in we actually past XX of years, the a takes. get the

is the standards. three we to the call Firstly is used what --

Now the be how of So services firstly, it's kind about the services? could called we that. good service standard. What define provider

decoration the renovation. providers first in the as thing is the industry So and further that to will empower we can be service such

part Secondly, Especially the SOP service can for overall the as as to during work for right? of the and standard business what we standard new well for we overall continue provide the example, how construction the -- is renovation the procedures, whole it define on. is can services

has standard a the such industry been for So There we no for digitalized. the as that such decoration. well was as systematic a data the it data market as standard – other is and system, as notice has part, online third -- been right? The the

we as the is mentioned past during already prepared standard, really my we period how the build that how protocols build can in I on So up focused why remarks. we up the

also initiatives in beam build example, this of standard well of to order part as understanding other up as as the protocols as well increase system we further For the for business. the

we well summary, to when we part commitment in our mentioned endeavor always business of as transform further the of had at look an that I full the business. so So, new as as

at give to So further confidence that and new for So more least our we at new three look you. and on the will to encourage the strongly efforts the us transforming future. at investors continue the more right? look the in year's basis, Thank to business of business efforts prepare

Thomas Chong

Thank Okay. you.

Operator

Zhao comes of next ask the line question Your CICC. from from your question. Please Liping

Liping Zhao

questions Xu and Matthew. evening, for Thanks Good here. two Stanley, have I taking Language] [Foreign Tao my questions.

First transaction. related one to the home is new

compared And relatively What and recently. transaction in Beike's has are the is home of market service home the second in existing players new Beike gain and what's market in Some advantage believe the question protect transaction. to lower with buyers entry barrier transactions. to existing new home. property transaction home business There to competitive core more matching and efficiencies home share? strategy companies your listed related more Compared strong is

Thank plan - and relationships the around you. service have with the more of However, value involve our In those long example property to companies run service chain, the property industry those plans companies? being AC tight localized advantage for owners. players to whether players property

Tao Xu

Okay. Thank you.

competency]. Regarding your first question home core for the our and new sales

say, truly industry. to Beike, we polish environment area the [indiscernible] [indiscernible] reevaluate players our to experience everyone [indiscernible] continuously we right huge. ourselves. player for agent transactions. And is costs into with do mentioned as a strategy From guarantee increase and we this all That for welcome work year-over-year an to and hope let's Some acres after not customer and better industry and agents efficiency improve housing this iterate make this the

So some low a rebate it's unrealistic the higher so-called or that always the commission far like promise. rates, there is capital valuation we setting is as functions unfair strange binding competition such do and realize base things the

understanding which investment job to this into up of mega now. out which is And in situation acquisition, past Just competition as the [indiscernible] approach high-profile ended how deep laid industry the and for transactions. enter how for last do with internet, with home year was fact the year this new to and the last the as

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Operator

question. ask Please comes JPMorgan. Your of line Ding your question from next from the Binbin

Binbin Ding

it I have [Foreign Language] quickly. two myself I'll translate questions.

of that made management regarding the some label anti-gov well as notice the So Beike. originally [ph] comments as the industry on

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changes you angle listing of any terms the recent changes in So certain you. make bring or including of will anti-trust in Thank aggressive more strategies? competitive become dynamic competitive the from a operational

Stanley Yongdong Peng

Binbin. Okay. you Thank

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go are on don't high, question. this Operator guy. Yojimbo slow, we move go where we from community let’s noises time social recent or we to [ph] next waste Regarding media, on reluctant

Operator

I the approaching We call. will call are remarks. to today, for your the of speaker now the conference end over now closing turn Zhao Matthew host Mr.

Matthew Zhao

again Thank operator. us Thank joining you for once you today.

through investor information quarter. relation you If call our you Beike's please we questions, looking provided on and you further any and today's forward next with team are have speaking goodbye. website. to contact free This the again concludes Thank to feel

Operator

conference participating. That Thank you concludes for today's call.

You may now disconnect.

KE (BEKE) 20 May 212021 Q1 Earnings call transcript