Agora Inc (API) 2022 Q3 法說會逐字稿

Good day, and thank you for standing by. Welcome to the Agora Inc. Third Quarter 2022 Financial Results Conference Call. (Operator Instructions) Please be advised that today's conference is being recorded.

美好的一天，謝謝你的支持。歡迎參加 Agora Inc. 2022 年第三季度財務業績電話會議。 （操作員說明）請注意，今天的會議正在錄製中。

And now I'd like to hand the conference over to Ms. Fionna Chen, Head of Investor Relations. Thank you. Please go ahead, ma'am.

現在我想把會議交給投資者關係主管 Fionna Chen 女士。謝謝你。請繼續，女士。

Thank you, operator. Good morning, everyone, and thank you for joining us for Agora's Third Quarter 2022 Earnings Conference Call. Our earnings results press release, SEC filings and a replay of today's call can be found on our IR website at investor.agora.io.

謝謝你，運營商。大家早上好，感謝您加入我們的 Agora 2022 年第三季度收益電話會議。我們的收益結果新聞稿、SEC 文件和今天電話會議的重播可以在我們的 IR 網站 investor.agora.io 上找到。

Joining me today are Tony Zhao, Founder, Chairman and CEO; and Jingbo Wang, our CFO.

今天加入我的是創始人、董事長兼首席執行官 Tony Zhao；和我們的首席財務官 Jingbo Wang。

Reconciliations between our GAAP and non-GAAP results can be found in our earnings press release.

我們的 GAAP 和非 GAAP 結果之間的調節可以在我們的收益新聞稿中找到。

During this call, we will make forward-looking statements about our future financial performance and other future events and trends. These statements are only predictions that are based on what we believe today, and actual results may differ materially. These forward-looking statements are subject to risks, uncertainties, assumptions and other factors that could affect our financial results and the performance of our business, which we discuss in detail in our filings with the SEC, including today's earnings press release and the risk factors and other information contained in the final prospectus relating to our initial public offering. Agora undertakes no obligation to update any forward-looking statements we may make on today's call.

在此次電話會議中，我們將就我們未來的財務業績以及其他未來事件和趨勢做出前瞻性陳述。這些陳述只是基於我們今天所相信的預測，實際結果可能存在重大差異。這些前瞻性陳述受風險、不確定性、假設和其他可能影響我們的財務業績和業務表現的因素的影響，我們在向美國證券交易委員會提交的文件中詳細討論了這些因素，包括今天的收益新聞稿和風險因素以及與我們的首次公開募股有關的最終招股說明書中包含的其他信息。 Agora 沒有義務更新我們在今天的電話會議上可能做出的任何前瞻性陳述。

With that, let me turn it over to Tony.

有了這個，讓我把它交給托尼。

Thanks, Fionna, and welcome, everyone, to our earnings call. Our revenue for the quarter was $41 million, a decrease of 9% year-over-year and flat quarter-over-quarter. During this quarter, 36,000 new applications registered on our platform, and our total number of registered applications exceeded 0.5 million. At the end of September, our number of active customers was close to 3,000, adding more than 400 compared to 1 year ago.

謝謝 Fionna，歡迎大家參加我們的財報電話會議。我們本季度的收入為 4100 萬美元，同比下降 9%，環比持平。本季度，我們平台上註冊了 36,000 個新應用程序，註冊應用程序總數超過 50 萬。 9月底，我們的活躍客戶數接近3000家，比一年前增加了400多家。

In the past few quarters, we faced an extremely challenging operating environment. Our revenue was hit by restrictive regulations in certain markets, which was the main reason behind year-over-year revenue decrease. More recently, inflationary pressure, interest rate hike and continued turbulence in global capital market have impacted some of our customers' expansion plan and their ability to raise funding which, in turn, limited the usage of our products. Lastly, the appreciation of the U.S. dollar also had a negative impact on our non-U.S. dollar denominated revenues.

在過去的幾個季度裡，我們面臨著極具挑戰性的經營環境。我們的收入受到某些市場限制性法規的打擊，這是收入同比下降的主要原因。最近，通脹壓力、加息和全球資本市場的持續動盪影響了我們部分客戶的擴張計劃和他們籌集資金的能力，進而限制了我們產品的使用。最後，美元升值也對我們的非美元計價收入產生了負面影響。

Despite those macro challenges, we continue to see strong demand for our products for new use cases, such as live video shopping, which didn't really exist in the U.S. market 18 months ago.

儘管存在這些宏觀挑戰，我們仍然看到對我們產品的新用例需求強勁，例如實時視頻購物，這在 18 個月前的美國市場上並不存在。

As we have seen again and again in our history, real-time engagement technology can transform any online activity and make it more immersive and engaging. This is why we remain optimistic about the long-term potential of our technology and products. However, the macro environment will likely remain volatile for some time. To cope with such uncertainties, we must remain nimble, laser focused and entrepreneurial.

正如我們在歷史上一次又一次看到的那樣，實時參與技術可以改變任何在線活動，並使其更具沉浸感和吸引力。這就是為什麼我們對我們的技術和產品的長期潛力保持樂觀。然而，宏觀環境可能會在一段時間內保持波動。為了應對這些不確定性，我們必須保持敏捷、專注和創業精神。

In recent months, we have been working hard to improve our operational efficiency and focused our efforts on priorities, including enhancing the quality of experience and ease of use of our core products, strengthening our go-to-market efforts and winning benchmark customers.

近幾個月來，我們一直在努力提高運營效率，並將工作重點放在優先事項上，包括提高核心產品的體驗質量和易用性，加強上市工作並贏得標杆客戶。

We have also made a few management changes to streamline our operations and reduce redundancies, including appointing Mr. Shawn Zhong, our Chief Scientist since 2018, to take on an expanded role as our Chief Technology Officer to oversee our global R&D organization. Last month, we also made the difficult decision to restructure and reduce our global workforce. Here, I would like to thank again those impacted friends and colleagues for their contribution along our journey.

我們還進行了一些管理變革，以精簡我們的運營並減少裁員，包括任命自 2018 年以來擔任我們首席科學家的 Shawn Zhong 先生擔任我們的首席技術官，以監督我們的全球研發組織。上個月，我們還做出了重組和裁員全球員工隊伍的艱難決定。在此，我再次感謝那些受影響的朋友和同事，感謝他們在我們的旅程中做出的貢獻。

Jingbo will discuss financial impact of the reduction in his remarks. I believe those moves will help us navigate the uncertainties in the near term. And with the right focus and execution, I think we are well positioned to gain market share and emerge from this challenging period stronger than ever.

Jingbo 將在他的講話中討論減持的財務影響。我相信這些舉措將幫助我們在短期內應對不確定性。通過正確的關注和執行，我認為我們有能力獲得市場份額並從這個充滿挑戰的時期中脫穎而出，變得比以往任何時候都更加強大。

Moving on to product updates. I'm thrilled to announce that in this quarter, we officially launched our next-generation, real-time engagement SDK, Agora 4.0, which has major upgrades in 3 key areas, namely more flexible, simpler to use and more powerful.

繼續進行產品更新。我很高興地宣布，在本季度，我們正式推出了我們的下一代實時參與 SDK，Agora 4.0，它在 3 個關鍵領域進行了重大升級，即更靈活、更易於使用和更強大。

First, on flexibility. Our SDK 4.0 has an open and modular architecture by design. It breaks down the entire end-to-end transmission path into dozens of loosely coupled components with standardized interface for each module. Developers now enjoy much more granular control over the media type to create the optimal experience for their specific use case.

首先，關於靈活性。我們的 SDK 4.0 在設計上具有開放的模塊化架構。它將整個端到端的傳輸路徑分解為幾十個鬆散耦合的組件，每個模塊都有標準化的接口。開發人員現在可以更精細地控制媒體類型，從而為他們的特定用例創造最佳體驗。

Next, on simplicity. With just a few lines of code, developers can easily integrate a wide range of first-party and third-party expansions with rich and engaging features such as audio and video effects, virtual backgrounds, transcription, content moderation, spatial audio, AI noise suppression and more.

接下來，關於簡單性。只需幾行代碼，開發人員就可以輕鬆集成各種第一方和第三方擴展，以及豐富而引人入勝的功能，例如音頻和視頻效果、虛擬背景、轉錄、內容審核、空間音頻、AI 噪聲抑制和更多。

Being flexible and easy to use does not mean any compromise on performance. For use cases that require high video quality, SDK 4.0 now supports up to 4K video at 60 frames per second. SDK 4.0 also supports multiple media sources from 1 single user, which is perfect for use cases such as online [proprietary] or professional music live streaming. For those that require highly synchronized transmission and ultra-low latency, such as online [karaoke], we can combine and deliver all [fun tracks] to all participants precisely at the same time. With our next-generation SDK, developers will be able to create innovative and immersive applications at a faster speed than ever before.

靈活且易於使用並不意味著對性能有任何妥協。對於需要高視頻質量的用例，SDK 4.0 現在支持高達每秒 60 幀的 4K 視頻。 SDK 4.0 還支持來自 1 個用戶的多個媒體源，非常適合在線 [專有] 或專業音樂直播等用例。對於那些需要高度同步傳輸和超低延遲的，例如在線【卡拉OK】，我們可以將所有【有趣的曲目】組合併精確地同時傳遞給所有參與者。借助我們的下一代 SDK，開發人員將能夠以前所未有的速度創建創新的沉浸式應用程序。

Now moving on to new use cases. The first one is live video shopping, which is growing very fast, and we already have several benchmark customers. For example, a leading collectibles auction marketplace leverages our platform to hold live auctions through real-time video. Its CEO describes the marketplace as a cross between the streaming platform Twitch and auction site eBay. It provides real-time auctions where customers can engage with the sellers and each other in a fast-paced video environment where auctions can be completed in as fast as 30 seconds.

現在轉向新的用例。第一個是視頻購物直播，增長非常快，我們已經有幾個標杆客戶。例如，領先的收藏品拍賣市場利用我們的平台通過實時視頻進行現場拍賣。它的首席執行官將市場描述為流媒體平台 Twitch 和拍賣網站 eBay 之間的交叉點。它提供實時拍賣，客戶可以在快節奏的視頻環境中與賣家互動，拍賣最快可在 30 秒內完成。

The second one is professional social networking, a global leading professional social network is leveraging our technology to power its live audio chat room. These rooms provide creators and influencers the ability to have live interactive conversations with people all over the world, and users can join speakers on stage and make broader networking connections post-event. Our quality in audio technology and global coverage throughout the world ensures them premium quality, perfectly matching their position as a professional social network.

第二個是專業社交網絡，全球領先的專業社交網絡正在利用我們的技術為其實時音頻聊天室提供支持。這些房間為創作者和有影響力的人提供了與世界各地的人進行實時互動對話的能力，用戶可以在舞台上加入演講者並在活動後建立更廣泛的網絡連接。我們的音頻技術質量和全球覆蓋範圍確保了他們的優質品質，與他們作為專業社交網絡的地位完美匹配。

Moving on to our RTE conference. In October and November, we hosted our iconic global RTE conferences for the eighth consecutive year where developers, customers and thought leaders from over 100 countries joined together to discuss various plans and explore the future of real-time engagement. Nearly 500 people attended in-person session, in-person program in San Francisco; close to 10,000 more registered for online sessions; and the total number of session views exceeded 500,000. This year also marks the first time that we hosted a dedicated RTE APAC conference, which has been well received and lively attended by local participants.

繼續我們的 RTE 會議。 10 月和 11 月，我們連續第八年舉辦標誌性的全球 RTE 會議，來自 100 多個國家/地區的開發人員、客戶和思想領袖齊聚一堂，討論各種計劃並探索實時參與的未來。近 500 人參加了在舊金山舉行的面對面課程；近 10,000 多人註冊了在線課程；會話總瀏覽量超過50萬。今年也是我們首次舉辦專門的 RTE APAC 會議，受到了當地與會者的熱烈歡迎。

Here, I would like to highlight some of the observations and the key messages from the conference. First, on end user experience. Evidence continues to build across use cases and geographies that our customers' business success is profoundly dependent on the end user experience that they can deliver. For example, a small increase in freeze rate in an audio chat room will reduce user session lengths and retention rates. Adding AI noise suppression for in-game team audio chat will significantly increase section lengths. Therefore, it's paramount for developers to partner with the most capable and reliable RTE provider in order to have the most advanced building blocks in creating real-time engagement experiences.

在此，我想強調會議的一些觀察結果和關鍵信息。首先，關於最終用戶體驗。越來越多的證據表明，我們客戶的業務成功在很大程度上取決於他們可以提供的最終用戶體驗。例如，音頻聊天室中凍結率的小幅增加將減少用戶會話長度和保留率。為遊戲內團隊音頻聊天添加 AI 噪聲抑制將顯著增加部分長度。因此，對於開發人員而言，與最有能力和最可靠的 RTE 提供商合作至關重要，以便擁有最先進的構建塊來創建實時參與體驗。

Second, on the trend of high-definition video. We expect to see the mainstream video resolution in real-time engagement steadily increase from 480p to 720p in response to end users' growing demand for better quality. Based on the usage of our platform, other things being equal, changing video resolution from 480p to 720p leads to an approximately 15% increase in overall session lengths. In case local network conditions cannot account the required bandwidth, our super resolution algorithm can take care of this issue by enhancing video resolution through the same bandwidth with only 3% increase in DPO and memory usage. This upgrade in video quality and experience will bring more business opportunities for our customers and for us as we have already seen a huge leap in 720p sessions since the beginning of this year.

第二，關於高清視頻的趨勢。我們希望看到實時參與中的主流視頻分辨率從 480p 穩步增加到 720p，以響應最終用戶對更高質量不斷增長的需求。根據我們平台的使用情況，在其他條件相同的情況下，將視頻分辨率從 480p 更改為 720p 會導致總會話時長增加約 15%。如果本地網絡條件無法滿足所需的帶寬，我們的超分辨率算法可以通過在相同帶寬下提高視頻分辨率來解決此問題，DPO 和內存使用量僅增加 3%。這種視頻質量和體驗的升級將為我們的客戶和我們帶來更多商機，因為我們已經看到自今年年初以來 720p 會議的巨大飛躍。

Lastly, on the trend of adding RTE capabilities to IoT devices. We are seeing that devices with RTE features are generally sold at higher premium compared with plain vanilla model without such capabilities. Examples include (inaudible) with cameras for real-time video, treadmills and rolling machines with screens for live streaming classes and study [lengths] with AR projection capabilities, enabling students to collaborate with their classmates. This type of human touch is only possible, thanks to RTE technologies, and we believe these experiences will be one of the fundamental drivers of IoT's future growth.

最後，關於向 IoT 設備添加 RTE 功能的趨勢。我們看到，與沒有這種功能的普通型號相比，具有 RTE 功能的設備通常以更高的溢價出售。示例包括（聽不清）帶攝像頭的實時視頻、帶屏幕的跑步機和滾輪機，用於直播課程和學習 [長度] 具有 AR 投影功能，使學生能夠與同學協作。只有借助 RTE 技術，這種人性化的接觸才有可能實現，我們相信這些體驗將成為物聯網未來發展的基本驅動力之一。

Before concluding my prepared remarks for this quarter, I want to thank all Agorans for the hard work and commitment during this challenging period. The fundamentals and long-term potential of real-time engagement technology remains the same despite the turbulent market environment. We are neither overoptimistic or overly pessimistic about the future of our industry, and we are still in the early stage of building a great company.

在結束本季度準備好的發言之前，我要感謝所有 Agorans 在這個充滿挑戰的時期所做的辛勤工作和承諾。儘管市場環境動盪，但實時參與技術的基本面和長期潛力保持不變。我們對行業的未來既不過分樂觀也不過分悲觀，我們仍處於建設偉大公司的早期階段。

As someone once said today is difficult, tomorrow is even harder, the day after, that will be great, although most people will be dead before that. I'm confident in our strategy for growth and in our ability to help Agora succeed and in your ability to help Agora succeed. What we need is to keep executing with determination and focus. Thank you all.

有人說過，今天難，明天更難，後天就很好，雖然大多數人在那之前就已經死了。我對我們的增長戰略、我們幫助 Agora 成功的能力以及您幫助 Agora 成功的能力充滿信心。我們需要的是繼續堅定和專注地執行。謝謝你們。

With that, let me turn things over to Jingbo who will review our financial results.

有了這個，讓我把事情交給 Jingbo，他將審查我們的財務結果。

Thank you, Tony. Hello, everyone. Let me start by first reviewing financial results for Q3 and then I will discuss the outlook for the fiscal year of 2022.

謝謝你，托尼。大家好。首先讓我回顧一下第三季度的財務業績，然後我將討論 2022 財年的展望。

Total revenues were $41 million in the third quarter of 2022, a decrease of 9% year-over-year and flat compared to last quarter. The year-on-year decrease was mainly due to restrictive regulations in certain markets, which was offset, in part, by revenue growth in other sectors and regions.

2022 年第三季度總收入為 4100 萬美元，同比下降 9%，與上一季度持平。同比下降主要是由於某些市場的限制性法規，部分被其他行業和地區的收入增長所抵消。

If we look at Q3 versus Q2 this year, the recent interest rate hikes and tightening of financing environment has impacted some of our customers' business and their ability to raise funding, which led to reduced usage on our platform. In addition, the continued appreciation of U.S. dollar has impacted our non-U.S. dollar denominated revenues when translated into U.S. dollar amount.

如果我們看一下今年第三季度和第二季度，最近的加息和融資環境收緊影響了我們一些客戶的業務和他們籌集資金的能力，從而導致我們平台的使用量減少。此外，美元的持續升值影響了我們以美元計價的非美元收入。

Our trailing 12 months constant currency dollar-based net expansion rate is 84% excluding Easemob. Specifically, dollar-based net expansion rate was above 130% for the U.S. and international business, which remain strong and healthy; and approximately 70% for the China business, mainly due to restrictive regulations in certain markets.

我們過去 12 個月的固定貨幣美元淨擴張率為 84%，不包括 Easemob。具體而言，美國和國際業務以美元計價的淨擴張率超過130%，保持強勁和健康；約 70% 用於中國業務，主要是由於某些市場的限制性法規。

Moving on to cost and expenses. For my following comments, I will focus on non-GAAP results, which exclude share-based compensation expenses, acquisition-related expenses, financing-related expenses, amortization expenses of acquired intangible assets and income tax related to acquired intangible assets.

繼續成本和費用。對於我接下來的評論，我將重點關注非 GAAP 結果，其中不包括基於股份的補償費用、收購相關費用、融資相關費用、所收購無形資產的攤銷費用以及與所收購無形資產相關的所得稅。

Non-GAAP gross margin for the third quarter was 59.8%, which was 5.7% lower than Q3 2021, mainly due to increased revenue from our broadcast streaming product, which contributed approximately 80% of our total revenues in the quarter and at lower gross margin.

第三季度非美國通用會計準則毛利率為 59.8%，比 2021 年第三季度下降 5.7%，主要是由於我們的廣播流媒體產品收入增加，該產品佔本季度總收入的約 80%，毛利率較低.

As Tony mentioned just now, we made the difficult decision to restructure and reduce our global workforce last month. The associated severance costs of $3.2 million are reflected in operating expenses in Q3. We also reduced other operating expenses such as rental benefits, software and advertising. Together, we expect to see roughly $9 million of cash savings on quarterly non-GAAP operating expenses in Q4 compared to Q3.

正如托尼剛才提到的，我們上個月做出了重組和裁員全球員工的艱難決定。 320 萬美元的相關遣散費反映在第三季度的運營費用中。我們還減少了其他運營費用，例如租金福利、軟件和廣告。與第三季度相比，我們預計第四季度的季度非 GAAP 運營費用將節省約 900 萬美元的現金。

Non-GAAP R&D expenses were $25.2 million in Q3, which included a provision of severance costs of $1.9 million. If we exclude the severance costs, the pro forma R&D expenses decreased approximately 14% from Q2 this year. Non-GAAP R&D expenses was 61.4% of total revenues in the quarter compared to 50.9% in Q3 last year.

第三季度非 GAAP 研發費用為 2520 萬美元，其中包括 190 萬美元的遣散費準備金。如果剔除遣散費，備考研發費用較今年第二季度下降約 14%。非美國通用會計準則研發費用佔本季度總收入的 61.4%，而去年第三季度為 50.9%。

Non-GAAP sales and marketing expenses were $13 million in Q3, up 17.7% year-over-year, mainly due to team expansion in the U.S. and certain international markets, and increased advertising and event expenses. Sales and marketing expenses represented 31.8% of total revenue in the quarter compared to 24.6% in Q3 last year.

第三季度非 GAAP 銷售和營銷費用為 1300 萬美元，同比增長 17.7%，這主要是由於美國和某些國際市場的團隊擴張，以及廣告和活動費用的增加。銷售和營銷費用佔本季度總收入的 31.8%，而去年第三季度為 24.6%。

Non-GAAP G&A expenses were $7.4 million in Q3, up 8.9% year-over-year, mainly due to team expansion in the U.S. G&A expenses represented 18.1% of total revenue in the quarter compared to 15.1% in Q2 last year.

第三季度非 GAAP G&A 費用為 740 萬美元，同比增長 8.9%，主要是由於美國團隊擴張。G&A 費用佔本季度總收入的 18.1%，而去年第二季度為 15.1%。

Non-GAAP operating loss was $18.7 million, translating to a 45.7% non-GAAP operating loss margin for the quarter compared to operating loss margin of 24.6% in Q3 last year.

非 GAAP 營業虧損為 1,870 萬美元，相當於本季度的非 GAAP 營業虧損率為 45.7%，而去年第三季度的營業虧損率為 24.6%。

Now turning to cash flow. Operating cash flow was negative $8.8 million in Q3 compared to negative $14 million last year. Free cash flow was negative $9.9 million compared to negative $15.6 million last year.

現在轉向現金流。第三季度的經營現金流為負 880 萬美元，而去年同期為負 1400 萬美元。自由現金流為負 990 萬美元，而去年為負 1560 萬美元。

Moving on to balance sheet. We ended Q3 with $483 million in cash, cash equivalents and short investments compared to $641 million at the end of Q2. Net cash outflow in the quarter was mainly due to free cash flow of negative $9.9 million; prepayment for land use right purchase of $137.4 million, net of deposit refunded; cash paid for long-term investments of $3.1 million; and share repurchase of 3.1 million (sic) [3.5 million]. By the end of Q3, we repurchased approximately 13.2 million of our Class A ordinary shares, equivalent to approximately 3.3 million ADS or $23.2 million, representing 12% of our $200 million share repurchase program.

轉到資產負債表。我們在第三季度末擁有 4.83 億美元的現金、現金等價物和短期投資，而第二季度末為 6.41 億美元。本季度淨現金流出主要是由於自由現金流為負 990 萬美元；土地使用權購買預付款 1.374 億美元，扣除已退還的押金；為長期投資支付的現金 310 萬美元；和股份回購 310 萬（原文如此）[350 萬]。到第三季度末，我們回購了約 1320 萬股 A 類普通股，相當於約 330 萬股 ADS 或 2320 萬美元，占我們 2 億美元股票回購計劃的 12%。

Now turning to guidance. COVID-19 is still an unprecedented variable on our business model, where historical experience may not apply. Our guidance on full year revenues reflects various assumptions that are subject to change based on uncertainties related to the impact of the COVID-19 pandemic. In addition, challenging macroeconomic environment and the turbulence in global capital markets have impacted some of our customers' business expansion and their ability to respond which, in turn, could limit their usage of our products. With that, we expect total revenues for the full year of 2022 to be in a range of $160 million to $162 million.

現在轉向指導。 COVID-19 仍然是我們商業模式中前所未有的變量，歷史經驗可能不適用。我們對全年收入的指導反映了各種假設，這些假設可能會根據與 COVID-19 大流行影響相關的不確定性而發生變化。此外，充滿挑戰的宏觀經濟環境和全球資本市場的動盪影響了我們部分客戶的業務擴張及其應對能力，進而可能限制他們對我們產品的使用。因此，我們預計 2022 年全年的總收入將在 1.6 億美元至 1.62 億美元之間。

In closing, we made tough decisions in this quarter under a challenging and uncertain macroeconomic environment. Looking forward, we will stick to our long-term strategy, be laser focused on key priorities and continue to improve our operational efficiency. With the right focus and execution, I believe we are well positioned to gain market share and emerge from this challenging period stronger than ever.

最後，在充滿挑戰和不確定的宏觀經濟環境下，我們在本季度做出了艱難的決定。展望未來，我們將堅持長期戰略，聚焦重點，持續提昇運營效率。憑藉正確的重點和執行力，我相信我們有能力獲得市場份額，並從這個充滿挑戰的時期中脫穎而出，變得比以往任何時候都更加強大。

Thank you to the entire Agora team for the hard work and thank you, everyone, for attending the call today.

感謝整個 Agora 團隊的辛勤工作，感謝大家參加今天的電話會議。

Operator, let's open it up for questions.

接線員，讓我們打開它提問。

(Operator Instructions) Our first question comes from David Lee from Bank of America Securities.

（操作員說明）我們的第一個問題來自美國銀行證券公司的大衛李。

I have 2 questions. Firstly, could you share more color on the customer demand trends for the domestic market and overseas, especially in Q4?

我有兩個問題。首先，您能否分享更多有關國內外市場，尤其是第四季度客戶需求趨勢的顏色？

My second question is regarding the ARPU and gross profit margin. It seems that the implied ARPU of overseas business declined in Q3 versus year-over-year growth in Q2. How do we see the ARPU and gross profit margin to trend in the following quarter or next year?

我的第二個問題是關於 ARPU 和毛利率。與第二季度的同比增長相比，第三季度海外業務的隱含 ARPU 似乎有所下降。我們如何看待下一季度或明年的 ARPU 和毛利率趨勢？

I'll take the demand question. In U.S. and the international markets, COVID has already passed largely. So in recent quarters, our demand was not really driven by COVID or anything related to COVID, but rather, more driven by new use cases such as live video shopping, as I mentioned earlier, and also in increasing adoption in mature use cases such as live cast education and telehealth. Similarly in China, COVID -- also COVID is an important thing here, affecting the whole macro economy. However, it's not anymore a significant demand driver for us. Currently, the main challenge on the demand side is rather on also the macroeconomic environment, indirectly from the COVID policy adjustment.

我會回答需求問題。在美國和國際市場，COVID 已經基本過去。因此，在最近幾個季度，我們的需求並不是真正由 COVID 或與 COVID 相關的任何事物驅動，而是更多地是由新用例（如我之前提到的實時視頻購物）以及成熟用例（如直播教育和遠程醫療。同樣在中國，COVID——也是 COVID 在這裡很重要，它影響著整個宏觀經濟。但是，它不再是我們的重要需求驅動因素。目前，需求側的主要挑戰還在於宏觀經濟環境，間接來自 COVID 政策調整。

As we have been seeing in recent company earnings, internet user growth and revenue growth of internet companies have been flat or significantly slowed down. Many companies are also cutting their growth targets for next year, which are limiting their usage of our products. However, we do see incremental demand from more traditional enterprises or IoT industries and a few small sectors. Those will continue, the areas that we will continue to invest more into, but it will take some time to ramp up adoption on those areas.

正如我們在最近的公司財報中看到的那樣，互聯網公司的互聯網用戶增長和收入增長已經持平或顯著放緩。許多公司還削減了明年的增長目標，這限制了他們對我們產品的使用。然而，我們確實看到更多傳統企業或物聯網行業和一些小行業的需求增加。這些將繼續，我們將繼續在這些領域進行更多投資，但需要一些時間來提高這些領域的採用率。

I'll take the question on ARPU and the GP margin. So in the U.S. market, actually, ARPU and GP margin have been quite stable recently. The main challenge was from international markets, such as Southeast Asia, South Asia. In these markets, we do see more pricing pressure which also affected ARPU because the continued appreciation of the U.S. dollar has effectively made our products more expensive in these markets in local currency because we are charged on global price in U.S. dollar. And against a lot of these emerging market currencies, the U.S. dollar has appreciated more than 10%, in some cases, more than 20%. So to better drive demand in these regions, we need to give additional discount and also to be very competitive in those markets.

我將回答有關 ARPU 和 GP 利潤率的問題。所以在美國市場，實際上，ARPU 和 GP 利潤率最近一直很穩定。主要挑戰來自國際市場，如東南亞、南亞。在這些市場中，我們確實看到了更多的定價壓力，這也影響了 ARPU，因為美元的持續升值有效地使我們的產品在這些市場以當地貨幣計算更加昂貴，因為我們以美元收取全球價格。美元兌許多新興市場貨幣升值超過 10%，在某些情況下甚至超過 20%。因此，為了更好地推動這些地區的需求，我們需要提供額外的折扣，並在這些市場中保持競爭力。

So that's the reason behind some weakness in ARPU and GP margin in these markets and also, more broadly speaking, as Tony mentioned, by the rate hike inflation, the capital market turbulence, the tightening of financing environment has made a lot of the customers' business more difficult which, in turn, affected demand and ARPU.

所以這就是這些市場的 ARPU 和 GP 利潤率疲軟背後的原因，而且，更廣泛地說，正如 Tony 提到的，加息通脹、資本市場動盪、融資環境收緊使很多客戶業務更加困難，進而影響需求和 ARPU。

So looking forward, we actually think GP will remain relatively stable. Or actually, in this quarter, as I mentioned earlier, the decrease in GP margin was mainly due to a product mix shift and, to a lesser extent, due to the pricing pressure from these emerging markets. And looking forward, product mix will not further change. So there, we are not seeing incremental pressure from [industry].

所以展望未來，我們實際上認為 GP 將保持相對穩定。或者實際上，正如我之前提到的，本季度 GP 利潤率的下降主要是由於產品組合的轉變，在較小程度上是由於這些新興市場的定價壓力。展望未來，產品結構不會進一步改變。因此，我們沒有看到來自 [行業] 的壓力增加。

Our next question comes from the line of Tom Tang from Morgan Stanley.

我們的下一個問題來自摩根士丹利的 Tom Tang。

I just had a quick question on the guidance. Since we have released a new guidance, just wondering if there's any further insights we can offer on our 2023 outlook. As we have previously mentioned, we want to break even by end of 2023. If there's -- just wondering if there's any changes to the plan.

我只是有一個關於指南的快速問題。由於我們發布了新的指南，我想知道我們是否可以就 2023 年的展望提供任何進一步的見解。正如我們之前提到的，我們希望到 2023 年底實現收支平衡。如果有——只是想知道計劃是否有任何變化。

Sure. I'll take this one. So as you have noticed, we rolled out our full year guidance for 2022, and this was mainly due to the recent macroeconomic challenges, as I just mentioned, the rate hikes, the financing environment and all that. So in terms of 2023, it is still too early to give any official guidance. But on a very high level, we are targeting 20% to 30% growth in the U.S. and international markets and a very moderate growth in China. But again, all these operating targets are still moving given the highly uncertain macroeconomic environment in the U.S., the emerging markets and also in China. And as to the breakeven time line, we are still committed to the same guidance. We aim to break even on a non-GAAP basis by the end of 2023.

當然。我要這個。正如你所注意到的，我們推出了 2022 年的全年指導，這主要是由於最近的宏觀經濟挑戰，正如我剛才提到的，加息、融資環境等等。所以就2023年而言，現在給出任何官方指導還為時過早。但在一個非常高的水平上，我們的目標是在美國和國際市場實現 20% 至 30% 的增長，並在中國實現非常適度的增長。但同樣，鑑於美國、新興市場和中國的宏觀經濟環境高度不確定，所有這些經營目標仍在變化。至於盈虧平衡時間表，我們仍然致力於相同的指導。我們的目標是到 2023 年底在非 GAAP 基礎上實現收支平衡。

Our next question comes from the line of Bing Duan from Nomura.

我們的下一個問題來自野村的段兵。

I just have one question. So how do we think about the head count growth in the next few quarters? Do we have an estimate of the growth of the R&D and sales marketing employees? And will this affect the operating expense growth in Q4 and Q1 next year?

我只有一個問題。那麼我們如何看待未來幾個季度的員工人數增長呢？我們對研發和銷售營銷人員的成長有預估嗎？而這會不會影響明年四季度和一季度的營業費用增長？

Yes. I'll take the first part. I think we take a very serious consideration before we make the decision to restructure and reduce the workforce. So we don't see, in the next few quarters, we want to expand the workforce. Again, we will continue to operate and try to practice a more efficient and leaner operation down the road, similarly to other costs.

是的。我先講第一部分。我認為在我們決定重組和裁員之前，我們會進行非常認真的考慮。所以我們看不到，在接下來的幾個季度裡，我們想要擴大員工隊伍。同樣，我們將繼續運營並嘗試在未來實踐更高效、更精簡的運營，類似於其他成本。

I don't know if Jingbo has anything to add.

不知道靜博有沒有什麼要補充的。

Yes. Just to add a few words from a financial perspective, so recent restructuring and the reduction will bring us about $9 million of cash savings in Q4 compared to Q3. And actually, we expect to see some additional savings in Q1 compared to Q4 because the reduction happened in the middle of Q4, so we still had 1 month of higher cost in Q4. And as Tony mentioned, we do not expect to increase head count in 2023.

是的。從財務角度補充幾句話，與第三季度相比，最近的重組和削減將為我們帶來約 900 萬美元的現金節省。實際上，與第四季度相比，我們預計第一季度會看到一些額外的節省，因為減少發生在第四季度中期，所以我們在第四季度仍有 1 個月的更高成本。正如 Tony 提到的，我們預計 2023 年不會增加員工人數。

(Operator Instructions) No further questions, I'll turn the call back to the management team for closing remarks.

（操作員說明）沒有進一步的問題，我會把電話轉回給管理團隊進行結束語。

Thank you, operator, and thank you, everybody, for attending our call today. If there are any more information, please visit our IR website. Today's presentation and also the speakers' remarks will be also posted on the website. Again, thank you, everybody. Thanks.

謝謝接線員，也謝謝大家今天參加我們的電話會議。如果有更多信息，請訪問我們的 IR 網站。今天的演講以及演講者的評論也將發佈在網站上。再次謝謝大家。謝謝。

Thank you. Bye-bye.

謝謝你。再見。

Thank you.

謝謝你。

Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.

謝謝你。今天的電話會議到此結束。感謝您的參與。您現在可以斷開連接。