New Oriental Training & Expertise Group (EDU) Q2 2025 Earnings Name Transcript

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New Oriental Training & Expertise Group (EDU -23.14%)
Q2 2025 Earnings Name
Jan 21, 2025, 8:00 a.m. ET

Contents:

• Ready Remarks
• Questions and Solutions
• Name Members

Ready Remarks:

Operator

Good night, and thanks for standing by for New Oriental’s FY 2025 second-quarter outcomes earnings convention name. [Operator instructions] At present’s convention is being recorded. [Operator instructions] I might now like to show the assembly over to your host for right this moment’s convention, Ms. Sisi Zhao.

Thanks. Please go forward.

Sisi Zhao — Director, Investor Relations

Thanks. Whats up, everybody, and welcome to New Oriental’s second fiscal quarter 2025 earnings convention name. Our monetary outcomes for the interval have been launched earlier right this moment and can be found on the corporate’s web site in addition to on Newswire providers. At present, Stephen Yang, govt president and chief monetary officer, and I’ll share New Oriental’s newest earnings outcomes and enterprise updates intimately with you.

After that, Stephen and I shall be out there to reply your questions. Earlier than we proceed, please notice that the dialogue right this moment will include forward-looking statements made below the secure harbor provisions of the U.S. Non-public Securities Litigation Reform Act of 1995. Ahead-looking statements contain inherent dangers and uncertainties.

As such, our outcomes could also be materially completely different from the view expressed right this moment. Numerous potential dangers and uncertainties are outlined in our public filings with the SEC. New Oriental doesn’t undertake any obligation to replace any forward-looking statements, besides as required below relevant regulation. As a reminder, this convention is being recorded.

As well as, a webcast of this convention name shall be out there on New Oriental’s Investor Relations web site at investor.neworiental.org. I’ll now first flip the decision over to Mr. Yang. Stephen, please go forward.

Stephen Yang — Govt Vice President, Chief Monetary Officer

Thanks, Sisi. Whats up, everybody, and thanks for becoming a member of us on the decision. We’re happy to tell you that New Oriental has achieved a wholesome development on this quarter’s monetary efficiency, which has surpassed our expectations. Income grew 19.4% yr over yr, and complete internet revenues, excluding revenues generated from East Purchase’s personal label merchandise and dwell streaming enterprise elevated by 31.3% yr over yr.

We’re inspired by the continued development of our new ventures, which have bolstered firm’s income. We imagine they’ll additional progress positively shifting ahead. New Oriental’s backside line efficiency for our core schooling enterprise has additionally proven strong returns. To raised replicate New Oriental’s core schooling enterprise, we’ve got excluded the working margins generated from East Purchase for this quarter.

Our working margin and non-GAAP working margin reached 2.8% and three.2%, respectively. Outcomes from these substantial efforts investing in our choices and platforms which have been proven efficient. Our dedication to sustaining wholesome profitability and market share stays sturdy as we proceed to purpose for long-term worth creation for our clients and shareholders. Now I might wish to spend a while to speak in regards to the quarter’s efficiency throughout our remaining enterprise traces and new initiatives to you intimately.

Our key remaining enterprise have showcased a promising development in adjoining to optimistic momentum throughout our new companies. Breaking it down, the abroad take a look at prep enterprise recorded a income improve of 21% yr over yr for the second fiscal quarter of 2025. The abroad research consulting enterprise recorded a income improve of about 31% yr over yr for the second fiscal quarter of the 2025. The adults and the college college students enterprise recorded a income improve of 35% yr over yr for this quarter.

On the similar time, our ongoing funding in new schooling enterprise initiatives, primarily targeted on facilitating college students throughout improvement, have additionally continued to thrive with regular development fueling the corporate’s momentum. Firstly, the non-academic tutoring enterprise, which we’ve got now expanded to round 60 present cities, targeted on cultivating college students’ modern skill and complete high quality. We now have attracted excessive curiosity with a complete of roughly 994,000 pupil enrollments reported on this quarter. The highest 10 cities contribute over 60% of this enterprise.

Secondly, the clever studying system and machine enterprise makes use of our previous instructing expertise knowledge expertise to supply customized and focused studying and train content material, thereby bettering college students’ studying effectivity. We now have examined the adoption of this new enterprise in round 60 present cities and are happy to see improved scalability. The income contribution of this enterprise from high 10 cities in China is round 50%. Our sensible schooling enterprise, academic supplies, and digitalized sensible research options have continued wholesome improvement.

In abstract, our new schooling enterprise initiatives have recorded a income improve of about 43% yr over yr for the second quarter. As well as, our newly built-in tourism-related enterprise line, which incorporates our rooted research tour and analysis campuses for Ok-12 and college college students in addition to our tourism enterprise serving middle-aged and senior viewers have collectively recorded a income improve of 233% yr over yr for the second quarter. Examine tour and analysis campuses are actually working in round 55 cities throughout the nation, with the highest 10 cities in China providing over 50% of the income share of this new enterprise. We’re additionally facilitating quite a lot of top-notch tourism choices to all age teams, together with the middle-aged and aged people throughout 30 featured province in China and globally.

With reference to our OMO system, we’ve got persevered in revamping our platform, leveraging our instructional infrastructure and expertise energy as a way to present superior, diversified schooling service to our clients of all ages. Throughout this quarter, we invested $30.9 million to enhance and preserve our OMO instructing platform, which enhanced customers expertise and helps the expansion of our schooling choices. Now let me share some updates on East Purchase’s efficiency. Throughout the reporting interval, East Purchase expanded its product vary from contemporary meals and snacks to diversified portfolio, launching 600 SKUs in personal label merchandise by November 2024.

This contains healthcare meals, pet meals, and new Chinese language-spell clothes contributing to roughly 37% of complete GMV for the six months ending November 2024. We’re happy to see multi-platform technique has expanded its shopper base and elevated model consciousness to counterpoint the dwell streaming merchandise and on-line outlets on platforms like mini program, which have mini retailer, Taobao, JD, Pinduoduo, and Rednote. This multichannel strategy has pushed fast development with product — label merchandise. Concurrently, East Purchase has begun exploring offline channels with merchandising machines in New Oriental’s studying facilities.

The corporate’s app technique has superior rapidly providing every day requirements and high-quality merchandise, resulting in elevated person contributions and robust loyalty. With regard to the corporate’s newest monetary place, I am happy to share that the corporate is in a wholesome monetary standing with money and money equivalents, time period deposits, and short-term investments totaling roughly $4.8 billion On August nineteenth, 2024, New Oriental introduced its board of administrators permitted a particular dividend of $0.06 per frequent share or $0.6 per ADS to holders of frequent shares and ADS of report as of the shut of the enterprise on September ninth, 2024, Beijing and Hong Kong Time and New York time, respectively. The cost date was on or round September twenty third, 2024 for holders of frequent shares in September twenty sixth, 2024, for holders of ADS. The entire money dividend distributed was roughly $100 million.

Now I want to take the chance to focus on that the corporate’s board of administrators permitted the share repurchase program in July 2022, wherein the corporate is allowed to buy — to repurchase as much as $400 million of the corporate’s ADSs or frequent shares by means of the subsequent 12 months. The corporate’s board of administrators additional proved to increase the efficient time of the share repurchase program to Might thirty first, 2025, and growing the mixture worth of shares that the corporate is allowed to repurchase from $400 million to $700 million. As of January twentieth, 2025, the corporate repurchased an combination of roughly 11.2 million ADSs for roughly $542.8 million from the open market. Now I’ll flip the decision over to Sisi to share with you about the important thing financials.

Sisi, please go forward.

Sisi Zhao — Director, Investor Relations

Thanks, Stephen. Now I might wish to share our key monetary particulars for this quarter. Working price bills for the quarter have been $1,019.4 million, representing a 20.2% improve yr over yr. Non-GAAP working price and bills for the quarter, which exclude share-based compensation bills have been $1,011.1 million, representing a 23.5% improve yr over yr.

The rise was primarily because of the price and bills associated to the accelerated capability growth for schooling companies and newly built-in tourism-related enterprise. Price of income elevated by 17.9% yr over yr to $498.3 million. Promoting and advertising bills elevated by 26.6% yr over yr to $196.1 million. G&A bills for the quarter elevated by 20% yr over yr to $324.9 million.

Non-GAAP G&A bills, which exclude share-based compensation bills have been $319.4 million, representing a 24.7% improve yr over yr. Whole share-based compensation bills, which have been allotted to associated price expense — working prices and bills decreased by 71.8% yr over yr, to $8.3 million on this fiscal quarter. Working revenue was $19.3 million, representing a 9.8% lower yr over yr. Non-GAAP revenue from operations for the quarter have been $27.6 million, representing a forty five.8% lower yr over yr.

Web revenue attributable to New Oriental for the quarter was $31.9 million, representing a 6.2% improve yr over yr. Primary and diluted internet revenue per ADS attributable to New Oriental have been $0.20 and $0.19, respectively. Non-GAAP internet revenue attributable to New Oriental for the quarter have been $35.5 million, representing a 29.1% improve yr over yr. Non-GAAP primary and diluted internet revenue per ADS attributable to New Oriental have been $0.22 and $0.22, respectively.

Web money circulation generated from operations for the second fiscal quarter of 2025 was roughly $313.3 million, and capital expenditures for the quarter have been $60.6 million. Turning to the stability sheet. As of November thirtieth, 2024, New Oriental had money and money equivalents of $1,418.2 million. As well as, the corporate had $1,443.2 million in time period deposits and $1,951.4 million in short-term investments.

New Oriental’s deferred income, which represents money collected upfront from clients and associated income that shall be acknowledged because the service or items are delivered on the finish of the second quarter of fiscal yr 2025 was $1,960.6 million, a rise of 19.2%, as in comparison with $1,645 million on the finish of the second fiscal quarter of 2024. Now I’ll hand over to Stephen to undergo our outlook and tips — steerage.

Stephen Yang — Govt Vice President, Chief Monetary Officer

I repeat the paragraph that the Sisi talked about of the online revenue. Web revenue attributable to New Oriental for the quarter was $31.9 million, representing a 6.2% improve yr over yr. Primary diluted internet revenue per ADS attributable to New Oriental have been $0.20 and $0.19, respectively. In regards to the outlook in fiscal yr ’25 Q3 steerage.

In mild of the present financial uncertainties, we stay dedicated to attaining regular and sustainable development for our core academic enterprise within the coming quarter. Our confidence is bolstered by the strong efficiency of our numerous enterprise traces and our in depth academic sources have been devoted to diligently adhering to the most recent steerage from the Chinese language authorities together with the just lately introduced the nationwide motion plan with the objective of creating a high-quality schooling system and unlocking potential throughout our enterprise traces and modern efforts. To stability income and profitability development, we’ll rigorously handle our capability growth and hiring methods to assist the event of our schooling enterprise in the remainder of this yr. We plan to observe our typical tempo to extend capability with a give attention to new choices in cities with a sturdy native economic system.

Concurrently, we’ll proceed to spend money on growing our rising tourism-related ventures. The muse we’ve got established and the progress we have achieved up to now strengthen our confidence in our future efficiency. We anticipate complete internet income, excluding revenues generated from East Purchase. Within the coming quarter, December 1st, 2024 to February twenty eighth, 2025, to be within the vary of $1,007.3 million to $1,032.5 million, representing a year-over-year improve within the vary of 18% to 21%.

The projected improve of the income in our practical foreign money Renminbi is anticipated to be within the vary of 20% to 23% for the third quarter of the fiscal yr 2025. To conclude, New Oriental is devoted to delivering premium choices to our clients whereas pursuing sustainable development by means of a strategic mix of capabilities. We’ll proceed investing analysis and purposes of superior applied sciences, together with AI and ChatGPT to reinforce our instructional and product providing. Our purpose is to strengthen our competencies, driving development and working effectivity.

We may even proceed to hunt steerage from and cooperate with the federal government authorities, complied with the related insurance policies, tips, and any associated rules, measures, and modify our enterprise operations as required. As at all times, we’ll work diligently to reinforce the nation’s schooling degree to strengthen its main place in order to unveil additional potential throughout our enterprise traces and realizing our imaginative and prescient. That is the tip of our fiscal yr 2025 Q2 abstract. At this level, Sisi and I wish to open the ground for questions.

Operator, please open the decision for these. Thanks.

Questions & Solutions:

Operator

Thanks. [Operator instructions] Our first query comes from the road of Yiwen Zhang from China Renaissance. Please go forward.

Yiwen Zhang — China Renaissance Securities — Analyst

Yeah, good. Thanks for taking my query. So my query is about our Q3 income steerage, I believe you talked about in RMB phrases is 20% to 23%. It appears a bit decelerating.

Can we perceive extra which a part of the enterprise is definitely driving that development? And the way ought to we take into consideration the remainder of the yr? Now additionally, in mild of this new steerage, how ought to we take into consideration the training middle growth tempo as properly? Thanks.

Stephen Yang — Govt Vice President, Chief Monetary Officer

Thanks, Yiwen. Yeah, in regards to the income steerage of Q3, sure, we gave the steerage of the year-over-year development within the vary of 20% to 23% in RMB phrases. I need to point out that we’re utilizing the conservative methodology to offer the steerage of Q3. And the explanations for a bit little bit of slowdown within the income development in Q3 are as follows: primary, the uncertainty of the macroeconomy scenario has a sure adverse impression on the demand of our high-end schooling enterprise, such because the abroad take a look at prep and associated enterprise and a few one-on-one enterprise, which can be high-end enterprise; and quantity two, with the fast restoration of the academic enterprise within the final two to a few years, I believe the income base is steadily growing.

So I believe the income development in Q3 shall be a bit bit decelerate; and quantity three, I believe the impression of the trade fee is roughly round 3% level. That is why we gave the steerage within the vary of 18% to 21% in greenback phrases. And I believe sure, regardless that we’re dealing with to the uncertainty of the macroeconomy scenario change, however I believe the administration will strive our greatest to develop the revenues. And so we anticipate to beat the steerage we gave to the traders in Q3.

And I believe then again, I believe we’ll care extra in regards to the stability between the income development and the working effectivity on the similar time for the long run. As for the growth plan, this quarter, we opened — this quarter, the growth — in Q2, the growth was 5% Q-on-Q in Q2. And for the entire yr, we’ve got the second half of the yr left. And in the entire yr, we plan to open 20% to 25% of the EDU studying facilities.

I believe we’ll solely open the New Oriental facilities within the cities that the final yr in high line and backside line efficiency as properly, and we permit them to open extra studying facilities. And — however we nonetheless care extra in regards to the utilization of the brand new studying facilities. So sure, that is why I stated we care extra in regards to the top-line development and the margins.

Operator

Thanks. Subsequent query is from the road of Felix Liu from UBS. Please go forward.

Felix Liu — UBS — Analyst

Good night and thanks for taking my query. Might I simply observe up on one of many points that you just talked about, which is macro impacting the higher-end enterprise. Do you see any potential threat to your extra mass-market providers, akin to the brand new schooling companies? And may administration touch upon the competitors panorama that you just’re observing on the bottom throughout your online business traces? Has competitors performed into a job within the development deceleration? Thanks.

Stephen Yang — Govt Vice President, Chief Monetary Officer

I believe for the brand new enterprise, we nonetheless information the Q2 steerage about 40% in RMB time period year-over-year development. And so it’s nonetheless very sturdy. And as for the competitors, sure, we’ve got seen some — a bit bit sturdy competitors available in the market. However I believe we’re positive.

So we’re nonetheless taking extra market share from the market. And due to the bottom within the Q3, we guided 40% in RMB time period year-over-year development due to the excessive base, Felix.

Felix Liu — UBS — Analyst

Thanks.

Operator

Thanks. Subsequent query comes from the road of Lucy Yu from Financial institution of America Securities. Please go forward.

Lucy Yu — Financial institution of America Merrill Lynch — Analyst

Thanks. So, Stephen, I keep in mind earlier, you gave the full-year steerage for 25% or 30% income development, excluding East Purchase, so provided that the subsequent quarter, you might be forecasting round like 21% to 23%. So the spending in that fourth quarter, we’ve got to speed up our income growth — income development or we’re aiming for a slower development this yr? Thanks.

Stephen Yang — Govt Vice President, Chief Monetary Officer

Yeah. As I stated, the uncertainty of the macroeconomy scenario, I believe we want another quarter to see to provide the This fall steerage. So I believe for the entire yr, sure, we’re dealing with a bit bit slowing down in Q3, however for the entire yr, I believe in RMB phrases, we nonetheless obtained the highest line development of the yr over yr development by, as an example, the 25% in RMB phrases or extra for the entire yr steerage, Lucy.

Lucy Yu — Financial institution of America Merrill Lynch — Analyst

That is good. Thanks a lot.

Operator

Thanks. Our subsequent query comes from Timothy Zhao of Goldman Sachs. Please go forward.

Timothy Zhao — Goldman Sachs — Analyst

Thanks. Hello, Stephen.

Stephen Yang — Govt Vice President, Chief Monetary Officer

Hello.

Timothy Zhao — Goldman Sachs — Analyst

My query is concerning your new schooling initiative. I seen that while you report your pupil enrollment quantity, I believe for this quarter, the non-academic tutoring enrollment development was round 26%. Simply questioning, might you additional elaborate on that? And what’s the extra normalized development that we anticipate by way of the coed enrollment for the non-academic tutoring. And likewise a follow-up query, I believe, on the training middle ramp-up.

I believe you talked about that you just see barely extra competitors on the bottom. Might you share, I believe, what’s the newest studying middle ramp-up tempo by way of the time for breakeven time to succeed in a extra — like a mature stage and likewise the utilization charges that you just see on the bottom? Thanks.

Sisi Zhao — Director, Investor Relations

OK. Timothy, concerning your enrollment query, really, in the event you take a look at the total yr roughly, as a result of quarterly enrollment quantity shall be impacted by just like the registration window, and so on. So there shall be some fluctuation of development. And yr over yr, really, the — we’re snug with roughly a couple of 40% plus development for brand spanking new enterprise together with the non-academic tutoring.

And this enterprise ought to develop comparable and even sooner. And roughly about 5%, possibly 4% to six% of ASP improve. And in the event you deduct that, the remaining are quantity improve, which is usually pushed by the enrollment quantity which you can see from our launch.

Operator

Thanks for the questions. One second for the subsequent query. Subsequent query comes from the road of Elsie Sheng from CLSA. Please go forward.

Unknown speaker — — Analyst

Hello. Thanks for taking my query. I simply wish to observe up on the strain that you just talked about on the abroad and extra premium enterprise, the one-on-one enterprise. So how do you measure the magnitude of this impression from macro? As a result of often, we perceive that schooling in nature ought to be extra resilient than different sort of consumption.

So how do you see the chance going ahead for this enterprise if we assume that macro going ahead proceed to stay comparatively in a weak standing?

Stephen Yang — Govt Vice President, Chief Monetary Officer

Final quarter, we gave the steerage of the abroad take a look at prep enterprise grown by lower than 20%. And since we’ve got seen some mother and father — some mother and father modified their thought to ship their children to check overseas sooner or later due to the macroeconomy scenario change. So I believe within the Q3, the abroad take a look at prep enterprise will develop by, as an example, someplace round 15%. And so it is a bit bit decelerated.

And — however that is the true scenario. And — however Ok-12 enterprise is OK. And we give the steerage of 40% year-over-year development in Q3. And so let’s examine for one more quarter, we’ll give the steerage for This fall in subsequent earnings name.

Unknown speaker — — Analyst

OK. Thanks.

Operator

Thanks. Subsequent query comes from Alice Cai from Citibank. Alice, your line is open. Please go forward.

All proper, as I am not listening to from Alice, I want to take the subsequent query. We now have our subsequent query from the road of DS Kim from J.P. Morgan. Please go forward.

DS Kim — JPMorgan Chase and Firm — Analyst

Thanks. Hello, Steven. Thanks for taking my query. My identify is DS Kim.

Can I observe up on the full-year steerage once more. I suppose — now as you form of briefly remarked, we will anticipate over 25% development in Renminbi time period for the total yr versus I believe beforehand, markets or administration form of anticipated about 30%, so about 5-point deceleration makes a number of sense. However how about our OP margin, can we nonetheless anticipate as much as about 100 bps growth for the schooling full-year margin core enterprise. And if OK, are you able to additionally assist elaborate albeit on the phase development quantity baked within the full-year income steerage, particularly the brand new enterprise? I believe Sisi remarked, 40% plus development there, however simply needed to double verify different phase and a bit extra particulars? Thanks.

Stephen Yang — Govt Vice President, Chief Monetary Officer

OK. Yeah, DS, let’s begin with this quarter margin evaluation in Q2. The non-GAAP OP margin for the academic enterprise, which excluding the East Purchase this quarter was expanded by 12 foundation factors yr over yr. And I believe it is primarily as a result of some causes due to the top-line development are good on this quarter, and we began to bear fruit of the training middle growth final yr, particularly within the second half of final yr.

So it is driving utilization charges up and get extra operational leverage. And sure, as I stated, we began to make some price and expense management inside the firm. So this quarter, we get the working leverage and drive the margin up. And as for the margin outlook for the second half of the yr, as I stated, I believe the — we face some slowing down of the overseas-related enterprise.

So I believe the margin drag shall be within the second half of the yr from the overseas-related enterprise. And likewise the newly tourism enterprise will drive the market within the second half of the yr. And so I believe within the second half of this yr, we’ll meet some margin strain. And because the margin outlook for the subsequent yr, I believe we’ll nonetheless anticipate the margin growth for the entire firm.

As a result of the Ok-12 margin shall be expanded within the new yr and within the second half of the yr as properly. And in second half of this yr as properly. And we’ll — began to chop the price and bills of the overseas-related enterprise. And we anticipate the margin profile of the tourism enterprise subsequent yr shall be higher than this yr.

So that is the margin evaluation —

DS Kim — JPMorgan Chase and Firm — Analyst

Thanks.

Operator

As soon as once more, we’ve got the road from Alice Cai from Citi. Please go forward.

Alice Cai — Citi — Analyst

Thanks administration for the chance —

Sisi Zhao — Director, Investor Relations

Alice, there’s some echo in your aspect. So we can not hear you clearly. Now, it’s higher.

Alice Cai — Citi — Analyst

OK. Thanks administration for the chance to ask questions. I’ve two questions right this moment. The primary one is I seen that you’re contemplating a daily dividend coverage which is kind of attention-grabbing given the present sturdy market demand, proper? On this regard, I might wish to ask does it sign any anticipated softening in demand and due to this fact, a deliberate extra length in capex spending going ahead.

Moreover, do you have got an estimated time line for when this dividend coverage could be declared. Moreover, how do you view this stability between enterprise growth and shareholder returns. Simply concerning the reported enchancment in breakeven time line for current opened — just lately opened studying facilities, I want to know, lets anticipate comparable effectivity ranges for future new studying facilities? Thanks a lot.

Stephen Yang — Govt Vice President, Chief Monetary Officer

Yeah. Second query answered first. I believe the — sometimes, we’ll spend six months to get the breakeven level of the brand new studying facilities. So the ramp-up tempo has not modified.

And as for the shareholders’ capital allocation, we introduced $700 million share buyback. And now we completed $542.8 million. And I believe we’ll maintain shopping for the share buyback and within the open market. And as for the particular dividend, sure, we’ve got paid $100 million in September as a particular dividend.

Sometimes, the board of administrators will talk about the brand new yr capital allocation coverage in July. However anyway, it relies upon in the marketplace cap, the inventory value. And — however we — I believe the administration will purpose to create extra worth to the shareholders because the capital return.

Operator

Thanks for the questions. Subsequent query will come from Yanbo Cheng the road of ION Group. Please go forward.

Unknown speaker — — Analyst

Hello. Are you able to hear me?

Stephen Yang — Govt Vice President, Chief Monetary Officer

Sure, please go forward, Yanbo.

Unknown speaker — — Analyst

Sure. Thanks. So my query is about how do you understand the regulatory panorama in your core and noncore companies, such because the tourism enterprise. Do you see there — are there any heightened or reduce regulatory dangers in these enterprise areas? Thanks.

Stephen Yang — Govt Vice President, Chief Monetary Officer

On the regulation aspect, there isn’t any change now. And I believe we’re OK to open the brand new studying facilities to get the license from the native authorities. And in order that’s why we wish to change our growth plan of this yr. And on entrance, on the regulation aspect, our angle is impartial to optimistic.

I believe as on this name will apply for the requirement of the federal government issues since three years in the past, the coverage change. Now the scenario has no change extra just lately, in order that’s it. Thanks.

Operator

Thanks for the questions. We are actually approaching the tip of the convention name. I’ll now flip the decision over to New Oriental’s govt president and CFO, Mr. Stephen Yang, for his closing remarks.

Stephen Yang — Govt Vice President, Chief Monetary Officer

Once more, thanks for becoming a member of us right this moment. When you’ve got any additional questions, please don’t hesitate to contact me or any of our Investor Relations representatives. Thanks.

Operator

[Operator signoff]

Length: 0 minutes

Name members:

Sisi Zhao — Director, Investor Relations

Stephen Yang — Govt Vice President, Chief Monetary Officer

Yiwen Zhang — China Renaissance Securities — Analyst

Felix Liu — UBS — Analyst

Lucy Yu — Financial institution of America Merrill Lynch — Analyst

Timothy Zhao — Goldman Sachs — Analyst

Unknown speaker — — Analyst

DS Kim — JPMorgan Chase and Firm — Analyst

Alice Cai — Citi — Analyst

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