Hello Group Inc (MOMO) 2024 Q2 法說會逐字稿

Ladies and gentlemen, thank you for standing by, and welcome to the second-quarter 2024 Hello Group Incorporated earnings conference call. (Operator instructions)

女士們，先生們，感謝你們的支持，歡迎參加 2024 年第二季 Hello Group Incorporated 收益電話會議。（操作員指令）

I would now like to hand the conference over to your first speaker today, Ms. Ashley Jing. Thank you. Please go ahead, ma'am.

現在，我想將會議交給今天的第一位演講者 Ashley Jing 女士。謝謝。請繼續，女士。

Thank you, operator. Good morning and good evening, everyone. Thank you for joining us today for Hello Group's second quarter 2024 earnings conference call. The company's results were released earlier today and are available on the company's IR website. On the call today, we have Mr. Tang Yan, CEO of the company; Ms. Zhang Sichuan, COO of the company; and Ms. Peng Hui, CFO of the company.

謝謝您，接線生。大家早安，晚上好。感謝您今天參加 Hello Group 2024 年第二季財報電話會議。該公司的業績已於今天早些時候公佈，並可在公司的 IR 網站上查閱。今天的電話會議由公司執行長唐岩先生主持；公司營運長張四川女士；以及公司財務長彭暉女士。

We will discuss the company's business operations and highlights, as well as the financials and guidance. They will all be available to answer your questions during the Q&A session that follows. Before we begin, I would like to remind you that this call may contain forward-looking statements made under the safe harbor provision of the Private Security Litigation Reform Act of 1995.

我們將討論該公司的業務運營和亮點，以及財務狀況和指導。他們將在隨後的問答環節中回答您的問題。在我們開始之前，我想提醒您，本次電話會議可能包含根據 1995 年《私人安全訴訟改革法》的安全港條款做出的前瞻性陳述。

Such statements are based on management's current expectations and current market and operating conditions, and relate to events that involve known or unknown risks, uncertainties, and other factors, all of which are difficult to predict and many of which are beyond the company's control, which may cause the company's actual results, performance, or achievements to differ materially from those in the forward-looking statements.

此類陳述基於管理層當前的預期以及當前的市場和營運條件，並與涉及已知或未知風險、不確定性和其他因素的事件有關，所有這些因素都難以預測且其中許多超出了公司的控制範圍，可能導致公司的實際結果、業績或成就與前瞻性陳述中所述的存在重大差異。

Further information regarding this and other risks, uncertainties, and factors is included in the company's filings with the US Securities and Exchange Commission. The company does not undertake any obligation to update any forward-looking statements as a result of new information, future events, or otherwise, except as required under law. I will now pass the call over to our COO, Ms. Zhang Sichuan. Ms. Zhang, please.

有關此風險和其他風險、不確定性和因素的更多資​​訊包含在公司向美國證券交易委員會提交的文件中。除非法律要求，否則本公司不承擔因新資訊、未來事件或其他原因更新任何前瞻性陳述的義務。現在我將電話轉給我們的營運長張四川女士。請張女士。

Hello, everyone. Thank you for joining our call. I will now walk you through the progress we made in the second quarter against our strategic priorities across all businesses.

大家好。感謝您加入我們的電話會議。現在，我將向您介紹我們第二季在所有業務的策略重點方面所取得的進展。

I will start with a brief overview of our financial performance. For the second quarter of 2024, total group revenue was RMB2.69 billion, down 14% year over year, but up 5% sequentially. Adjusted operating income was RMB477 million, down 33% year over year and 7% sequentially. Profit margin was 17.7%, down 4.9 percentage points year over year and 2.4 percentage points sequentially.

我將首先簡要介紹我們的財務表現。2024年第二季度，集團總營收為人民幣26.9億元，年減14%，但季增5%。調整後營業收入為人民幣4.77億元，較去年同期下降33%，較上季下降7%。利潤率為17.7%，較去年同期下降4.9個百分點，較上季下降2.4個百分點。

In terms of business segments, total revenue from the Momo app and standalone new apps was RMB2.46 billion, down 13% year over year, but up 6% sequentially. The year-over-year decline was mainly due to the decline in revenue from the Momo app resulting from spending softness amid the weak macro economy and our proactive product and operational adjustments to maintain a healthy community ecosystem since the end of last year. The sequential increase was due to seasonality.

分業務來看，陌陌應用程式及獨立新應用程式總收入為人民幣24.6億元，年減13%，季增6%。年比下降主要由於宏觀經濟疲軟導致支出疲軟導致陌陌應用收入下降，以及我們自去年底以來為維持健康的社區生態系統而進行的積極產品和營運調整。環比增長是由於季節性因素。

In Q2, standalone new apps maintained their growth momentum on both year over year and sequential basis, driven by our overseas business. Adjusted operating income from the Momo app and standalone new apps was RMB456 million, down 33% year over year and 6% sequentially, mainly due to the revenue decline. Adjusted operating margin was 18.5%, down 5.5 percentage points year over year and 2.4 percentage points sequentially.

第二季度，在海外業務的推動下，獨立新應用程式繼續保持同比和環比增長勢頭。陌陌應用程式及獨立新應用程式的調整後營業收入為人民幣4.56億元，年減33%，季減6%，主要由於收入下降。調整後營業利益率為18.5%，較去年同期下降5.5個百分點，較上季下降2.4個百分點。

For Tantan, total revenue for the quarter was RMB234 million, down 27% year over year and 3% sequentially, mainly due to the decrease in the number of paying users. Adjusted operating income was RMB20.6 million, compared with RMB31.9 million a year ago and RMB28.8 million a quarter ago, representing a margin of 8.8%, down 1.1 percentage point year over year and 3.1 percentage points sequentially.

探探本季總收入為人民幣2.34億元，年減27%，季減3%，主要因付費用戶數減少。調整後營業收入為人民幣 2,060 萬元，去年同期為 3,190 萬元，本季為人民幣 2,880 萬元，利潤率為 8.8%，年減 1.1 個百分點，季減 3.1 個百分點。

Now I'll walk you through the progress we've made against our strategic priorities for Momo, Tantan, and the new endeavors since the beginning of the year. Our main goal for the Momo app this year is to maintain the productivity of this cash cow business with a healthy social ecosystem.

現在我來向大家介紹一下陌陌、探探以及今年以來我們在戰略重點方面的進展。我們今年對陌陌的主要目標是，透過健康的社交生態，維持這顆搖錢樹業務的生產力。

Tantan's goal is to continue to improve the core dating experience and build an efficient business model that drives profitable growth. As for our new endeavors, our goal is to further enrich the brand portfolio, push the business boundaries beyond Momo and Tantan, and build a long-term growth engine.

探探的目標是持續提升核心約會體驗，並建立推動獲利成長的高效商業模式。對於新的嘗試，我們的目標是進一步豐富品牌組合，拓展陌陌和探探以外的業務邊界，打造長期成長引擎。

I will now walk you through the details of our execution. First, on the product and operational front of the Momo app. In the second quarter, our product team focused on optimizing the community ecosystem, improving the female user experience, and increasing the volume of effective social interactions. To improve the experience of female users receiving greetings, our product team applied AI technology to help male users generate greeting phrases, which increased the success rate of ice-breaking chats and led to the growth of two-way chats.

我現在將向你們介紹我們執行的細節。首先，關於陌陌應用的產品和營運方面。第二季度，我們的產品團隊致力於優化社群生態，提升女性用戶體驗，增加有效社交互動量。為了提升女性用戶接收問候的體驗，我們的產品團隊應用AI技術幫助男性用戶產生問候語，增加了破冰聊天的成功率，並帶動了雙向聊天的成長。

In terms of algorithm strategy, we increased the matching weight of active female users to improve the experience for users with unmet social needs. Our optimization of products and recommendation strategies played a positive role in increasing both the number of matches and the number of two-way chats. In addition, for the Finding Partners or (spoken in Chinese), a pilot program for our online-to-offline interest groups which has been running for a year, in the second quarter, we focused on expanding the coverage of our young user base to improve Momo's social brand perception.

在演算法策略上，我們增加了活躍女性用戶的匹配權重，以提高未滿足社交需求的用戶體驗。我們對產品和推薦策略的優化，對匹配數和雙向聊天數的增加起到了積極的作用。此外，對於「尋找合夥人」這個已經運行了一年的線上線下興趣小組試點項目，我們在第二季度重點擴大了年輕用戶群的覆蓋範圍，以提高陌陌的社交品牌認知度。

Our efforts to further improve and make breakthroughs in products and algorithms based on brand tone, vibe, and user preferences are an important foundation for Momo cash cow business to maintain stable productivity.

我們圍繞著品牌調性、氛圍、用戶喜好等，在產品和演算法上進一步完善和突破，是陌陌現金牛業務保持穩定生​​產力的重要基礎。

On the channel front, our user acquisition team continued to implement ROI-oriented strategies and worked with our commercial product team to recommend interactive features to users from channels that match their spending capabilities to improve paying conversion. In order to increase the proportion of female users, we adjusted our advertising materials and channel strategies to focus on female users and worked with our product team to specifically recommend interactive female-friendly features to improve their onboarding experience on our platform.

在通路方面，用戶獲取團隊持續執行以ROI為導向的策略，與商業產品團隊合作，從與用戶消費能力相符的管道向用戶推薦互動功能，提高付費轉換率。為了增加女性用戶的比例，我們調整了廣告素材和管道策略，以專注於女性用戶，並與我們的產品團隊合作，專門推薦適合女性的互動功能，以改善她們在我們平台上的入職體驗。

After several years of optimizing channel strategies, the room to further reduce unit acquisition cost is relatively limited. Accordingly, we have been working with KOLs to leverage new channels to bring in incremental traffic, thereby increasing brand exposure with a limited budget and controlling user acquisition cost within a reasonable range. In the second quarter, the Momo app had 7.2 million paying users, an increase of 100,000 driven by the return of long-tail VAS users after the Q1 low seasonality.

經過數年優化通路策略，進一步降低單位採購成本的空間相對有限。因此，我們一直與KOL合作，利用新通路引入增量流量，從而在有限的預算下增加品牌曝光度，並將用戶獲取成本控制在合理的範圍內。第二季度，陌陌App付費用戶數達720萬，較上季增加10萬，主要得益於第一季淡季過後長尾加值服務的回歸。

Now let's talk about the productivity of our Momo cash cow business. In the second quarter, Momo's live streaming revenue was RMB1.22 billion, down 15% year over year but up 6% sequentially. The year-over-year decline was mainly due to our strategy to proactively reduce revenue-oriented large-scale competition events in order to maintain a healthy social ecosystem and spending softness amid the weak macro economy.

現在我們來談談陌陌搖錢樹業務的生產力。第二季度，陌陌直播收入為12.2億元，年減15%，季增6%。年比下降主要由於我們採取主動減少以收益為導向的大型賽事活動的策略，以維持健康的社會生態系統，並在宏觀經濟疲軟的情況下減少支出。

On a sequential basis, revenue increased after the seasonal low, but the growth rate was lower than in previous years. This was mainly due to the adjustment to our event operating policy, which resulted in lower profits for agencies and broadcasters, which in turn caused them to be less motivated. To address this issue, we have moderately increased the incentives for non-event operations, and the revenue sharing ratio has increased slightly quarter over quarter.

與上一季相比，收入在季節性低潮後有所增加，但成長率低於前幾年。主要是由於賽事營運政策調整，導致經紀公司和轉播方利潤下降，經營積極性下降。針對這個問題，我們適度增加了非活動營運的激勵力度，營收分成比例也較上一季略有提升。

Our product team also introduced specific interactive features for users at different levels, while increasing daily revenue and reducing reliance on event revenue. Moreover, we've introduced props such as privileged functions and host costumes in the live streaming showrooms, which do not require revenue sharing. This not only enriches the variety of features and keeps users engaged, but it also plays a positive role in improving the profit level of live streaming.

我們的產品團隊也針對不同層級的使用者推出了特定的互動功能，同時增加了每日收入，減少對活動收入的依賴。另外，我們在直播間引入了特權功能、主播服裝等道具，這些道具不需要分成。這不僅豐富了內容種類、提高了使用者黏性，對提升直播的獲利水準也起到了正面的作用。

In Q2, revenue from value-added services, excluding Tantan, totaled RMB1.21 billion, down 9% year over year but up 5% sequentially. VAS revenue from the Momo app was RMB850 million, down 20% year over year but up 5% sequentially. Revenue from the standalone apps was RMB355 million, up 36% year over year and 4% sequentially.

第二季度，不含探探的增值服務收入為12.1億元，較去年同期下降9%，較上季成長5%。陌陌應用增值服務收入為人民幣 8.5 億元，年減 20%，季增 5%。獨立應用程式收入為人民幣 3.55 億元，年增 36%，季增 4%。

The year-over-year decline in VAS revenue from the Momo app was mainly due to our proactive product and operational adjustments to mitigate regulatory risks, which put pressure on the number of Momo VAS paying users and ARPPU; additionally, macro factors also weighed on consumer sentiment. The sequential growth was mainly due to seasonality.

陌陌應用加值服務收入年減主要由於我們為降低監管風險而主動進行產品及營運調整，導致陌陌加值服務付費用戶數及ARPPU值承受壓力；此外，宏觀因素也影響消費者情緒。環比增長主要由於季節性因素。

On the product operation front, we launched new gifting features in the audio-and-video based commercial channels to help broadcasters effectively interact with medium and long-tail users. We also tested interactive light games such as Xiao Xiao Le and new categories such as love fortune-telling in our chatroom feature which has the largest user base. Our data showed that the paying conversion of new features was higher than that of existing features.

產品營運方面，在影音商業頻道推出全新贈送功能，幫助主播與中長尾用戶有效互動。我們還在擁有最大用戶群的聊天室功能中測試了「小小樂」等互動輕遊戲和「愛情算命」等新類別。我們的數據顯示，新功能的付費轉換率高於現有功能的付費轉換率。

Turning to Tantan, let me first talk about its user trends and financial performance. Although our cost reduction and efficiency improvement strategy implemented over the past two years has effectively driven Tantan to profitability, the continued reduction in channel investments has put significant pressure on Tantan's user base.

說到探探，我首先要講一下它的使用者趨勢和財務表現。雖然過去兩年實施的降本增效策略有效推動探探獲利，但通路投入的持續減少，給探探的使用者群體帶來了不小的壓力。

Meanwhile, the lack of investment in branding over the years has led to a continuous decline in organic users. At the same time, we haven't been able to find an effective product-level solution that can significantly improve user retention. The combination of the above-mentioned factors has resulted in Tantan's MAU decreasing by 6% sequentially to 12.9 million in June.

同時，多年來對品牌建立的投入不足，導致有機用戶數量持續下降。同時，我們還沒有找到有效的產品級解決方案來大幅提高用戶留存率。受上述因素影響，探探6月份月活躍用戶數季減6%至1290萬。

As of the end of the second quarter, Tantan had 1 million paying users, down 100,000 sequentially. The main reasons were the decline in MAU, the short-term negative impact on new user paying conversion from the UI upgrade, and the regulatory-related redesign of the auto-renewal page.

截至第二季末，探探付費用戶數為100萬，較上一季減少10萬。主要原因包括MAU下滑、UI升級對新用戶付費轉換的短期負面影響、以及受監管影響自動續費頁面重新設計。

Turning to Tantan's financials, total revenue for the quarter was RMB234 million, down 27% year over year and 3% sequentially, mainly due to a reduction in the number of paying users. Overall ARPPU was flat year-on-year. Among which, the ARPPU of the live streaming business decreased significantly as a result of our strategy to de-emphasize live streaming which has a low correlation with the dating experience; while the VAS ARPPU saw a significant year-on-year increase, thanks to our efforts to promote relatively high-priced products such as Black Gold, SVIP membership and additional pay-as-you-go privileges for members, enabling the stability of the overall ARPPU.

談到探探的財務數據，本季總營收為 2.34 億元，年減 27%，季減 3%，主要原因是付費用戶數量減少。整體 ARPPU 與去年同期持平。其中，由於我們策略性地淡化與約會體驗相關性較低的直播，直播業務的 ARPPU 大幅下降；加值業務ARPPU較去年同期大幅提升，得益於公司大力推廣黑金、SVIP會員、會員額外按量付費權益等價格相對較高的產品，使得整體ARPPU保持穩定。

In terms of business lines, VAS revenue was RMB140 million, down 18% year over year and 4% sequentially, while live streaming revenue was RMB83 million, down 43% year over year and 5% sequentially.

業務方面，增值服務收入為人民幣1.40億元，年減18%，季減4%；直播收入為人民幣0.83億元，較去年同期下降43%，季減5%。

Now, I'd like to walk you through the efforts we made on Tantan's product and user acquisition fronts and the challenges we face. First, on the marketing and user acquisition front, to address the issues of weak brand awareness among young users and a significant decline in organic users due to inadequate brand promotion, we conducted marketing events during the quarter in cooperation with offline venues such as bars and clubs in metropolitan cities with a high density of young people.

現在我想向大家介紹一下探探在產品和用戶獲取方面所做的努力以及面臨的挑戰。首先，在行銷和用戶獲取方面，針對年輕用戶品牌認知度不高，以及品牌推廣不足導致有機用戶大幅下降的問題，我們在本季度與年輕人聚集的大城市的酒吧、俱樂部等線下場所合作開展營銷活動。

We also leveraged new media channels for online promotion to increase awareness of Tantan among young people and overall brand popularity. We believe that, compared with user acquisition through channels, driving user growth by improving brand awareness is a relatively long term initiative that can take time to bear visible fruits, but over time it plays a positive role in the continuous and stable growth of organic users.

我們也利用新媒體管道進行線上推廣，提升探探在年輕人中的認知度和品牌的整體知名度。我們認為，相較於透過管道獲取用戶，透過提升品牌知名度來推動用戶成長是一個相對長期的舉措，可能需要一段時間才能取得明顯的成效，但隨著時間的推移，它將對自然用戶的持續穩定成長發揮積極的作用。

Especially as Tantan has gradually refocused on the core dating experience by de-emphasizing community-oriented and entertainment-oriented experiences in recent quarters, it is important for us to strengthen young people's awareness of Tantan's value for dating through long-term brand investments and product improvements. Therefore, continuously increasing the opportunities for brand exposure within a controllable range of marketing investments will be a long-term direction of our branding strategy in the future.

尤其是在探探近幾季逐漸不再強調社區導向和娛樂導向的體驗，而是重新將焦點放在核心約會體驗上的情況下，透過長期的品牌投資和產品改進來加強年輕人對探訪約會價值的認識對我們來說非常重要。因此，在行銷投入可控的範圍內不斷增加品牌曝光機會將是我們未來品牌策略的長期方向。

On the user acquisition front, factors such as the e-commerce festival in June led to fierce channel competition, resulting in a sequential increase in unit acquisition cost, which, combined with the pressure on new user ARPU from the UI upgrade, led to a sequential decrease in channel ROI. To address this, our user acquisition team and membership product team worked together to recommend relatively high-end membership products to high-value users from channels, which helped to increase new user ARPU.

在用戶獲取方面，6月電商節等因素導致通路競爭加劇，單位獲客成本較上月上升，加上UI升級對新用戶ARPU值帶來壓力，導致通路ROI季減。為了解決這個問題，我們的用戶獲取團隊和會員產品團隊合作，向通路中的高價值用戶推薦相對高端的會員產品，這有助於提高新用戶的ARPU。

Now, let me give you an update on the progress Tantan has made on the product and operational side. In the second quarter, we worked on an upgraded version to improve the dating experience for users. Preliminary user interviews and surveys revealed two major pain points in user experience: first, uncertainty about the authenticity of profile pictures and users identity; and second, lack of response to chats after matching.

現在我來向大家介紹探探在產品和營運上的進度。第二季度，我們推出了升級版本，以改善用戶的約會體驗。初步的使用者訪談與調查發現，使用者體驗主要存在兩大痛點：第一，對頭像和使用者身分的真實性存在不確定性；二是配對後聊天沒有回應。

Since the issue of spamming has been effectively controlled since the beginning of the year, user feedback on inauthentic experiences stemmed primarily from issues such as incomplete profile information, lack of real person authentication, and photos which look too good to be true. The first phase of our redesign in Q2 focused on guiding users to complete their profile information and encouraging them to spend more time learning about potential matches before swiping.

自今年以來，刷屏問題已被有效控制，用戶對不真實體驗的回饋主要集中在個人資料資訊不完整、缺乏真人認證、照片看起來太好看等問題。我們在第二季度重新設計的第一階段重點是引導用戶完成他們的個人資料訊息，並鼓勵他們在滑動之前花更多時間了解潛在的匹配對象。

Early data shows that users with richer profile content had significantly higher post-match conversation rates than those with just a profile picture and basic information. However, this improvement in matching experience and deeper chat interactions conflicted with our existing business model, which relied largely on users' quick swiping decisions based solely on looking at profile pictures.

早期數據顯示，個人資料內容更豐富的用戶的配對後對話率明顯高於僅有個人資料圖片和基本資訊的用戶。然而，這種配對體驗的提升和更深層的聊天互動與我們現有的商業模式相衝突，因為現有的商業模式很大程度上依賴用戶僅透過查看個人資料圖片而做出的快速滑動決策。

The negative impact of this redesign on new user paying conversion was one of the reasons for the sequential decline in Tantan's number of paying users. Nevertheless, we believe that making short-term commercial sacrifices to improve long-term user experience is a critical foundation for Tantan to ultimately achieve its strategic goal of profitable growth.

此次改版對新用戶付費轉換的負面影響是探探付費用戶數量較上季下降的原因之一。儘管如此，我們認為，做出短期商業犧牲以改善長期用戶體驗是探探最終實現獲利成長策略目標的關鍵基礎。

We should monetize on product features that improve user experience and add value to them rather than do so at the expense of user experience, which can only get us into a downward cycle. During the ongoing product upgrade and optimization, our commercial product team will continue to focus on optimizing paying experience to increase new user ARPU, which should partially offset the negative impact on revenue caused by the product upgrade.

我們應該透過提高用戶體驗、增加產品價值的功能來實現獲利，而不是以犧牲用戶體驗為代價，這只會讓我們陷入惡性循環。在持續的產品升級優化過程中，我們的商業產品團隊將繼續致力於優化付費體驗，以提高新用戶ARPU，這應該會部分抵消產品升級對收入的負面影響。

Lastly, in terms of our new endeavors, in the second quarter, total revenue of the new apps reached RMB355 million, up 36% year over year and 4% sequentially, mainly driven by our overseas business. With a stable channel ROI, we moderately increased channel investments, driving steady growth in MAU and paying users. On the product and operational front, our team has been accelerating the localization process of overseas business since the beginning of the year.

最後，就我們的新業務而言，第二季度，新應用總收入達到人民幣 3.55 億元，年增 36%，環比增長 4%，這主要得益於我們的海外業務。在通路投資報酬率穩定的情況下，適度增加通路投入，帶動MAU及付費用戶穩定成長。在產品和營運方面，我們的團隊從今年年初開始就不斷加速海外業務的在地化進程。

After strengthening the localization research on virtual gifts and props, our commercial product team introduced hot sale gifts that better match local user preferences. Meanwhile, our local operations team refined our services for high paying users and standardized supply-side collaboration and KPIs. These combined efforts led to a significant increase in the number of top-tier paying users, which in turn drove ARPPU growth. The simultaneous increase in paying users and ARPPU has laid a solid foundation for sustainable and stable growth in our overseas business.

商業產品團隊加強虛擬禮物、道具的在地化研究，推出了更符合當地用戶喜好的熱銷禮物。同時，我們的本地營運團隊完善了針對高付費用戶的服務，並標準化了供應方協作和KPI。這些共同努力使得頂級付費用戶數量大幅增加，進而推動了 ARPPU 的成長。付費用戶數和ARPPU的同步提升，為海外業務持續穩定成長奠定了堅實基礎。

Regarding our expansion in the MENA region, we are focusing on two key tasks: regional expansion and expanding our offering from voice based to live streaming. These initiatives are taking longer than we anticipated at the beginning of the year as we realized that both efforts require a highly localized service team as a prerequisite. We have not done enough in the past couple of years in terms of localization, and we are now accelerating our efforts to make up for the shortcomings.

關於我們在中東和北非地區的擴張，我們專注於兩個關鍵任務：區域擴張以及將我們的服務從語音擴展到直播。這些舉措所花的時間比我們年初預計的要長，因為我們意識到這兩項努力都需要高度在地化的服務團隊作為先決條件。這兩年我們在在地化方面做的還不夠，現在正在加快力道彌補不足。

Overall, we remain confident in our growth potential in the MENA region. Compared to six months ago, we now have a clearer understanding of what we must do to continue to grow and we will continue to invest in this region.

總體而言，我們對中東和北非地區的成長潛力仍然充滿信心。與六個月前相比，我們現在對必須做些什麼才能繼續成長有了更清晰的認識，我們將繼續在該地區投資。

This concludes my remarks. Now let me pass the call over to Cathy for the financial review. Cathy please.

我的發言到此結束。現在，讓我將電話轉給 Cathy 進行財務審查。請叫我凱西。

Thank you, Sic. Hello, everyone. Thank you for joining our conference call today. Now, let me briefly take you through the financial review. Total revenue for the second quarter 2024 was RMB2.69 billion down 14% year on year but up 5% quarter over quarter.

謝謝你，Sic。大家好。感謝您參加我們今天的電話會議。現在，讓我簡單向大家介紹一下財務回顧。2024年第二季總營收為人民幣26.9億元，年減14%，但季增5%。

Non-GAAP net income attributable to the company was RMB449.2 million compared to RMB632.1 million for the same period of 2023 and RMB59.9 million from the last quarter. In Q1, we had a one-off non-cash tax provision. Excluding this non-cash tax item, non-GAAP net income would have been RMB508.5 million for last quarter.

非公認會計準則下歸屬於公司的淨利潤為人民幣 4.492 億元，而 2023 年同期為人民幣 6.321 億元，上一季為人民幣 5,990 萬元。在第一季度，我們有一次性非現金稅收準備。若剔除此項非現金稅項，上季非公認會計準則淨利為5.085億元。

Looking into the key revenue items for the quarter. Firstly on live broadcasting, total revenue from live broadcasting business for the second quarter of 2024 was RMB1.30 billion, down 18% year over year, but up 5% quarter-over-quarter. The year-over-year decrease was largely attributable to a decline in the core Momo live streaming business and, to a lesser degree, the decrease in Tantan. The sequential growth was driven by the core Momo live streaming service.

查看本季的主要收入項目。首先是直播，2024年第二季直播業務總收入為人民幣13.0億元，較去年同期下降18%，但季增5%。年減主要歸因於核心陌陌直播業務的下滑，以及探探業務的下滑（較小程度）。環比成長主要得益於核心的陌陌直播服務。

In terms of segments, Momo app live broadcasting revenue totaled RMB1.22 billion for the quarter, down 15% year over year, but up 6% quarter over quarter. The year-over-year decrease was due to our proactive product and operational adjustments to de-emphasize revenue-oriented competition events and weak consumer sentiment.

分板塊來看，陌陌APP直播營收本季為12.2億元，年減15%，季增6%。年比下降的原因是我們積極進行產品和營運調整，不再強調以收入為導向的競賽活動和疲軟的消費者情緒。

The sequential growth was due to a rebound after negative seasonality. Tantan's live broadcasting revenue amounted to RMB83 million, down 43% year over year and 5% quarter-over-quarter. The decrease was due to our strategic decision to pivot away from the less dating-centric service. Revenue from the value-added services for the second quarter of 2024 was RMB1.35 billion, down 10% from Q2 last year, but up 4% sequentially. The YoY decrease was due to a decline in both Momo and Tantan. However, the growth of standalone new apps partially offset the downward revenue pressure.

連續的成長是由於季節性負面衝擊後的反彈。探探直播收入8,300萬元，較去年同期下降43%，季減5%。下降的原因在於我們做出了策略決策，不再提供以約會為中心的服務。2024年第二季增值服務營收為人民幣13.5億元，較去年第二季下降10%，但較上一季成長4%。同比下降是由於陌陌和探探的銷量下滑。不過，獨立新應用的成長部分抵銷了收入下行的壓力。

Value-added service revenue grew sequentially, driven by the recovery from Momo VAS and continued growth of new applications. Revenue from VAS on an ex-Tantan basis was RMB1.21 billion in the second quarter of 2024, down 9% from Q2 last year, but up 5% from the previous quarter. MoMo app's value-added service revenue decreased from Q2 last year due to our proactive product adjustments to manage regulatory risks, as well as a weak spending sentiment. And the sequential revenue growth was driven by seasonal recovery.

加值服務收入季增，得益於陌陌增值服務的復甦和新應用的持續成長。2024年第二季度，除探探外增值服務收入為人民幣12.1億元，較去年第二季下降9%，但較上一季成長5%。由於我們主動調整產品以管理監管風險，以及消費情緒低迷，MoMo 應用程式的增值服務收入較去年第二季有所下降。連續的收入成長是由季節性復甦推動的。

Revenue from the standalone new apps continued to grow both on a year-on-year and quarter-over-quarter basis, driven by the steady improvement of the overseas business. Tantan's value-added service revenue amounted to RMB139.9 million, down 18% year over year and 4% sequentially. The decrease was due to a decline in paying users which was in turn due to a reduction in channel investment, the UI upgrade, and the adjustments to subscription renewal policy.

受海外業務穩定改善的推動，獨立新應用收入較去年同期持續成長。探探增值服務收入為人民幣1.399億元，較去年同期下降18%，季減4%。下降主要由於通路投入減少、UI升級、以及訂閱續費政策調整導致付費用戶減少。

Now turning to cost and expenses. Non-GAAP cost of revenue for the second quarter of 2024 was RMB1.59 billion compared to RMB1.82 billion for the same period last year. Non-GAAP gross margin for the quarter was 40.8%, down 1.3 percentage points from the year-ago period. The year-over-year decrease was primarily due to a number of different factors.

現在來談談成本和費用。2024年第二季非公認會計準則營收成本為人民幣15.9億元，去年同期為人民幣18.2億元。本季非公認會計準則毛利率為40.8%，較去年同期下降1.3個百分點。年比下降主要是由於多種不同因素造成的。

Number one, higher payout ratio in our overseas endeavors as we expand into new regions and try to launch new video services as well as the change in revenue mix toward higher payout businesses. Number two, deleverage where direct personnel and infrastructure costs take up a higher percentage of revenues. Number three, payment channel costs represent a higher percentage of revenues as revenue mix shifts toward overseas business.

第一，隨著我們向新的地區擴張並嘗試推出新的視訊服務，以及收入結構向更高派息業務的轉變，我們在海外業務中的派息率也更高。第二，去槓桿，直接人員和基礎設施成本佔收入的更高比例。第三，隨著收入結構向海外業務轉移，支付通路成本佔收入的比例更高。

The payout ratio of the core Momo app remains stable with a slight downward trend due to the reduction in event-related bonuses. Non-GAAP R&D expenses for the second quarter was RMB179.9 million compared to RMB200.8 million for the same period last year, or an 11% decrease year over year. The decrease was due to the continuous optimization in personnel and infrastructure costs. Non-GAAP R&D expenses as a percentage of revenue was 7% compared with 6% from the year-ago period.

陌陌核心應用的派息率保持穩定，但由於活動相關獎金的減少而略有下降趨勢。第二季非美國通用會計準則研發費用為1.799億元人民幣，去年同期為2.008億元，年減11%。下降是由於人員和基礎設施成本的持續優化。非公認會計準則研發費用佔營收的百分比為 7%，去年同期為 6%。

We ended the quarter with 1,364 total employees, of which 282 are from Tantan, compared to 1,470 total employees, of which 339 from Tantan a year ago. The R&D personnel as a percentage of total employee for the group was 62% compared with 63% due to last year. Non-GAAP sales and marketing expenses for the second quarter was RMB360.6 million or 16% of total revenue, compared to RMB349.7 million or 11% of total revenue for the same period last year.

截至本季度，我們共有 1,364 名員工，其中 282 名來自探探；去年同期共有 1,470 名員工，其中 339 名來自探探。集團研發人員佔員工總數的比例為62%，去年為63%。第二季非美國通用會計準則銷售及行銷費用為3.606億元人民幣，佔總營收的16%，去年同期為3.497億元人民幣，佔總營收的11%。

The year-over-year increase in absolute RMB amount was mainly due to an offline gala for Momo live streaming service, which in 2023 was held in Q1. Non-GAAP G&A expenses was RMB89.5 million for the second quarter of 2024, compared to RMB83.2 million for the same period last year, both representing a 3% of total revenue.

人民幣絕對金額的​​同比增長主要由於陌陌直播線下盛會，該盛會於 2023 年第一季舉行。2024年第二季非公認會計準則一般及行政費用為人民幣8,950萬元，去年同期為人民幣8,320萬元，均佔總收入的3%。

Non-GAAP operating income was RMB476.5 million, a decrease of 33% from Q2 2023, down 7% from the previous quarter. Non-GAAP operating margin for the quarter was 17.7%, down 4.9 percentage points from the same period last year and 2.4 percentage points from the previous quarter. Non-GAAP OpEx as a percentage of total revenue was 23%, an increase from 20% from Q2 2023 and up from 22% in Q1 this year.

非GAAP營業收入為4.765億元人民幣，較上季2023年第二季下降33%，較上季下降7%。本季非美國通用會計準則營業利益率為17.7%，較去年同期下降4.9個百分點，較上季下降2.4個百分點。非 GAAP 營運支出佔總收入的百分比為 23%，高於 2023 年第二季的 20%，也高於今年第一季的 22%。

Now briefly on income tax expenses. Total income tax expense was RMB102.6 million for the quarter, with an effective tax rate of 19%. In Q2, the company accrued withholding income tax of RMB17.3 million, which is 5% of undistributed profit generated by our WFOE. Without the withholding tax, our estimated non-GAAP effective tax rate was around 16% in the second quarter.

現在簡單介紹一下所得稅費用。本季總所得稅費用為人民幣1.026億元，有效稅率為19%。第二季度，公司預扣所得稅1,730萬元，占我們外商獨資企業產生的未分配利潤的5%。如果沒有預扣稅，我們估計第二季的非公認會計準則有效稅率約為 16%。

Now turning to balance sheet and cash flow items. As of June 30, 2024, Hello Group's cash, cash equivalents, short-term deposits, long-term deposits, short-term investments, and restricted cash totaled RMB14.32 billion compared to RMB13.48 billion. as of December 31, 2023. In Q2, we paid an equivalent of RMB716 million cash dividends to our shareholders. In the current quarter, we bought back RMB395 million or USD54 million worth of shares in the open market. Net cash provided by operating activities in the second quarter 2024 was RMB475.2 million.

現在轉向資產負債表和現金流量項目。截至 2024 年 6 月 30 日，哈嘍集團的現金、現金等價物、短期存款、長期存款、短期投資及受限現金總額為人民幣 143.2 億元，而去年同期為 134.8 億元。截至 2023 年 12 月 31 日。第二季度，我們向股東發放等值人民幣7.16億元的現金紅利。本季我們在公開市場回購了價值3.95億元或5,400萬美元的股票。2024年第二季經營活動提供的淨現金為4.752億元人民幣。

Lastly, on business outlook, we estimated our third quarter revenue to come in the range from RMB2.58 billion to RMB2.68 billion, representing a decrease of 15.2% to 11.9% year over year, or a decrease of 4.1% to 0.4% quarter over quarter. At segment level for Q3 2024, on a sequential basis, we expect Momo revenue to decrease mid to low single digits. On the Tantan side, we expect revenue to decrease high single digits.

最後，在業務展望方面，我們預計第三季營收將在人民幣25.8億元至人民幣26.8億元之間，年減15.2％至11.9％，季減4.1％至0.4％。在 2024 年第三季的細分層面，我們預計陌陌收入將按環比下降中低個位數。就探探方面而言，我們預期收入將下降高個位數。

Please be mindful that this forecast represents the company's current and preliminary view on the market and operational conditions, which are subject to change. That concluded our prepared portion of today's discussion. With that, let me turn the call back to Ashley to start Q&A. Ashley, please.

請注意，此預測代表公司對市場和營運狀況的當前和初步看法，可能會發生變化。今天我們準備的討論部分到此結束。說完這些，讓我將電話轉回給 Ashley 開始問答環節。請叫我艾希莉。

(Operator instructions) Xueqing Zhang, CICC.

(操作員指示) 張學清，CICC。

(spoken in Chinese) Thanks, management, for taking my question. My question is about Momo. Considering the current macro and regulation environment, how to view the revenue and the profit of the last half of the year? And what's your strategy for live streaming and VAS business in the next few years? Lastly, does Momo have a chance to achieve top-line goals in 2025? Thank you.

（中文）謝謝管理層回答我的問題。我的問題是關於 Momo 的。在當前的宏觀和監管環境下，如何看待下半年的收入和利潤？未來幾年，你們對於直播和加值業務的策略是什麼？最後，陌陌有機會在 2025 年實現營收目標嗎？謝謝。

(spoken in Chinese) Let me answer this question. At the end of last year, we adjusted the operating strategy for live streaming and audio- and video-based value-added service experiences to reduce revenue-oriented events. The decline in competition events or related revenues in the past few quarters have indeed had a negative impact on the core Momo app revenue. But our live streaming and VAS team managed to partially offset the revenue decline by introducing new interactive gamified features.

（中文）讓我來回答這個問題。去年底，我們調整了直播和影音增值服務體驗的營運策略，減少以營收為導向的活動。過去幾季的比賽活動或相關收入的下降確實對陌陌核心應用收入產生了負面影響。但我們的直播和增值服務團隊透過推出新的互動遊戲功能成功部分抵消了收入下降。

For example, as Sic just mentioned, we have introduced personalized costume props in the live streaming showrooms and also added new categories such as love fortune-telling in our value-added service chatroom experience which have played a positive role in improving paying conversion. And overall, the impact of the operating strategy adjustment on Mono revenue is pretty much in line with our expectations. And the impact on the profit side is actually indeed better than our expectations for the first half of the year.

例如剛才Sic提到的，我們在直播間引入了個人化的服裝道具，在增值服務聊天室體驗中也增加了愛情算命等新的品類，這些都對提升付費轉換起到了積極的作用。整體來看，營運策略調整對Mono收入的影響基本上符合我們的預期。而且對利潤方面的影響其實確實比我們對上半年的預期好。

Therefore, we have decided to continue the operational adjustments to the ecosystem in the second half. and further de-emphasize agency-dominated experiences and features, particularly various competition events.

因此我們決定下半年繼續對生態系統進行營運調整。並進一步淡化機構主導的體驗和特色，特別是各種競賽活動。

On the product front, we will leverage Momo's social attributes to introduce richer, interactive, gamified features for paying users at different levels. Although this will cost some short-term financial sacrifice, we believe it will create a positive ecosystem for the stable and healthy development of the cash cow business in the long run. As for whether our revenue can grow in 2025, it depends mainly on macroeconomic and regulatory changes. It's a bit too early to tell now. As for the revenue and profit guidance for the second half, I will leave that to Cathy. Cathy, please.

在產品方面，我們將運用陌陌的社群屬性，為不同層級的付費用戶推出更豐富、互動、遊戲化的功能。雖然這會付出一些短期的財務犧牲，但我們相信從長遠來看，這將為搖錢樹業務的穩定健康發展創造一個積極的生態系統。至於2025年我們的營收能否成長，主要取決於宏觀經濟和監管的變化。現在說還太早。至於下半年的營收和利潤預期，我將留給 Cathy 決定。請叫我凱西。

Okay. On the financial outlook of the cash cow business, for top line, last quarter, we said Q2 would be a good basis to think about the back half of the year. What that means is that if you take the 18% year-over-year decrease in Momo application live streaming, and value-added service in Q2, you can apply that same weight for the back half of the year as well.

好的。關於搖錢樹業務的財務前景，就上個季度的營收而言，我們認為第二季將是思考下半年業績的良好基礎。這意味著，如果你考慮到陌陌應用程式直播和增值服務在第二季度同比下降了 18%，那麼你也可以將同樣的權重應用到今年下半年。

Originally, we thought that second half might be a little bit better because the YoY comparison could get a little bit easier as we entered into the back half of the year. However, since the cash cow actually over-delivered on the bottom line for the first half, We decided that we should use this opportunity to continue our operational adjustments to push the ecosystem more toward social entertainment rather than competition-driven events.

最初，我們認為下半年可能會好一些，因為進入下半年，年比比較可能會變得容易一些。然而，由於這棵搖錢樹在上半年實際上超額完成了盈利，我們決定利用這個機會繼續進行營運調整，推動生態系統更多地向社交娛樂而非競爭驅動的活動方向發展。

That decision could dip the revenue slightly for the second half of 2024, but overall the cash cow is on track to deliver the annual profit target we internally set for it at the beginning of the year. So that's how to think about the cash cow. Other than the cow, within Momo segment, we also have the new applications, mainly the overseas apps.

這項決定可能會導致 2024 年下半年的收入略有下降，但總體而言，這棵搖錢樹有望實現我們在年初內部設定的年度利潤目標。這就是我們對於搖錢樹的看法。除了乳牛之外，陌陌內部還有新的應用，主要是海外的應用。

This piece will continue the robust YoY growth momentum. So that could partially offset the YoY decrease from the cow. I think for the whole year for the Momo segment revenues, we will likely to fall into the 10% to maybe 12% range in terms of YoY decrease. With regards to 2025, as Tang Yan said, it's still too early to tell, but the two biggest determining factors here are still going to be macro and regulatory environment.

此部分將延續強勁的年成長動能。因此這可以部分抵消牛的同比下降。我認為陌陌部門全年收入的年減幅度可能會在 10% 到 12% 之間。對於2025年，正如唐岩所說，現在下結論還為時過早，但最大的兩個決定因素仍然是宏觀環境和監管環境。

Profit-wise, our view remains pretty much the same as last quarter. We're still well on track to hit the same adjusted operating margin of high teens for the year. Also internally, we are actually trying to deliver the same annual profit target in absolute dollar amount. We do have the flexibility and are also prepared to control the spending more tightly if top line is under a little bit of a pressure down the road. On the other hand, if things turn out to be more positive on the revenue front, we will perhaps invest a little bit more for the future.

從利潤方面來看，我們的觀點與上季基本相同。我們仍有望實現今年調整後營業利潤率同樣高水準的目標。此外，在內部，我們實際上正試圖以絕對美元金額實現相同的年度利潤目標。我們確實具有靈活性，如果未來營收面臨一點壓力，我們也準備更嚴格地控制支出。另一方面，如果收入方面的情況更加積極，我們可能會在未來投入更多。

In other words, we are trying to manage the cost against the top line so we can deliver the annual profit target we set for ourselves at the beginning of the year. So I guess those are the colors I can give at this point. I'll look for both top line and bottom line. Other than that, I don't want to pin ourselves down too much by promising a bottom line number at this point, at this time of the year. So hopefully that helps. Back to Ashley for next question, please.

換句話說，我們正努力控製成本以控制營收，這樣我們才能實現年初為自己設定的年度利潤目標。所以我想這些就是我現在可以給的顏色。我會尋找頂線和底線。除此之外，在一年中的這個時候，我不想透過承諾底線數字來給自己帶來太多的限制。希望這會有所幫助。請回到 Ashley 來回答下一個問題。

Hi, operator. Ready for next question, please.

你好，接線生。請準備回答下一個問題。

Jenny Yuan, UBS.

瑞銀的 Jenny Yuan。

(spoken in Chinese) First of all, thanks for taking my question and congrats on the results. My question is regarding our overseas business. With the good revenue growth momentum in the new apps, could management update us with overseas progress so far? And do you have any financial outlook or guidance for this year that you can share with us? Thank you.

（中文）首先，感謝您回答我的問題，並對結果表示祝賀。我的問題是關於我們的海外業務。由於新應用程式的收入成長勢頭良好，管理層能否向我們介紹迄今為止海外取得的進展？您對今年的財務有什麼展望或指導可以與我們分享嗎？謝謝。

(spoken in Chinese) As I mentioned before, we believe that the growth in our overseas business depends on three main factors. Number one, strengthen localized operation. Number two, expand product offering from voice-based to live streaming services. And number three, expand our businesses in Wealthy GCC region and other countries in the Middle East. As Sic just mentioned, we have accelerated the localization process since the beginning of the year. And in the first half, we have made some good progress in feature design, refined services offering for high-paying users and supply-side collaboration.

（中文）正如我之前提到的，我們認為海外業務的成長取決於三個主要因素。第一，強化本地化營運。第二，將產品範圍從語音服務擴展到直播服務。第三，擴大我們在富裕的海灣合作委員會地區和中東其他國家的業務。正如剛才Sic提到的，我們從今年年初就開始加快在地化進程。上半年我們在功能設計、針對高付費用戶的精細化服務以及供應方協作等方面取得了一些進展。

(spoken in Chinese) This is certainly far not enough for a group company that pursues a global expansion. We need to continue to expand our overseas personnel pool, strengthen localized operations, and improve our cross-border personnel management practices. Improving the international awareness of our team will help us more deeply understand and better meet the social preferences and needs of users from different cultural backgrounds.

（中文）對於一個追求全球擴張的集團公司來說，這當然是遠遠不夠的。要不斷擴大海外人才隊伍建設，加強屬地化經營，改善跨國人員管理。提升團隊的國際意識，有助於我們更深入地理解並更好地滿足不同文化背景使用者的社交偏好和需求。

(spoken in Chinese) The rollout of the live streaming experience in the first half was slightly slower than our expectations at the beginning of the year. This is mainly because it took longer to resolve localization and agency cooperation issues on the product and operational front. Recently, key members of our product and tech team at the Beijing headquarters visited several key social markets and worked with local teams to sort out user feedback and optimize the product and technical solutions.

（中文）上半年直播體驗的推出比我們年初的預期稍慢一些。主要是因為解決產品和營運方面的在地化和代理合作問題需要更長的時間。近期，我們北京總部產品和技術團隊的主力成員走訪了幾個重點社交市場，與當地團隊一起整理用戶回饋，優化產品和技術方案。

The growth of the overseas team has laid a solid foundation for upgrading localized virtual gift design and user interface, speeding up testing of live streaming features to enrich gamified experiences, and deepening our exploration in GCC countries and Turkish markets. After this round-off visit and joint work with the overseas team, we are more convinced of the revenue growth opportunity in the Middle East market and the strategy of achieving growth through enhanced localization. As for the financial part, I will leave that to Cathy. Cathy, please.

海外團隊的成長為升級在地化的虛擬禮物設計和使用者介面、加快測試直播功能以豐富遊戲化體驗、深化在海灣合作委員會國家和土耳其市場的探索奠定了堅實的基礎。經過此次巡視以及與海外團隊的共同努力，我們更加堅信中東市場的收入成長機會以及透過加強在地化實現成長的策略。至於財務部分，我將交給凱西 (Cathy) 處理。請叫我凱西。

Sure. As Tang Yan mentioned, now it looks like we need to spend some time beefing up our local operations before we could pursue larger-scale revenue growth in the broader MENA area. We've been lagging behind on that front in comparison with some of our --we've been lagging behind on localization front in comparison with some of our peers who were early into the Middle East markets.

當然。正如唐岩所提到的，現在看來，我們需要花一些時間加強本地業務，然後才能在更廣泛的中東和北非地區追求更大規模的收入成長。與我們的一些早期進入中東市場的同行相比，我們在這方面已經落後了——在本地化方面，我們已經落後了。

For example, the senior management paid our first visit to our major markets in MENA only last month. It was not until then did we realize that there is still some basic level of the infrastructures we need to put in place in order to take the revenue to the next level. So I guess we are going to spend the second half of the year playing some catch-up in those areas.

例如，高層管理層上個月首次訪問了我們中東和北非地區的主要市場。直到那時我們才意識到，為了將收入提升到一個新的水平，我們仍然需要建立一些基礎基礎設施。所以我想我們會在今年下半年花一些時間在這些領域追趕。

The good news is that after the trip, we are even more convinced that there are still a lot of growth opportunities in MENA, so revenue will continue to grow. But before we go full force into, for example, live streaming service, the YoY growth will likely slow down a little bit from Q1 level as we spent time laying the groundwork for strong localization.

好消息是，這次行程結束後，我們更加確信中東和北非地區仍有大量成長機會，因此收入仍會持續成長。但在我們全力進軍直播服務等業務之前，由於我們花了一些時間為強大的本地化奠定基礎，年比成長可能會比第一季略有放緩。

In Q2, the overseas piece achieved 40-something percent year-over-year growth. It could further slow to maybe mid-30s in the back half before our initiatives in Gulf countries and live streaming start bearing fruits. So that's the color that I can give in terms of financial outlook for the overseas business.

第二季度，海外業務年增40%以上。在我們在海灣國家和直播領域的舉措開始取得成果之前，下半年這一比例可能會進一步放緩至 35% 左右。這就是我對海外業務財務前景的展望。

Okay. Operator, next question please.

好的。接線員，請問下一個問題。

Thomas Chong, Jefferies.

傑富瑞 (Jefferies) 的托馬斯張 (Thomas Chong)。

(spoken in Chinese) Thanks, management, for taking my question. My question is about Tantan. Just in the prepared remarks, management talks about the revamp of Tantan is still in progress. Can management talk about the current situation and our ultimate goal as well as how our revenue and profitability will be impacted by this revamp? Thank you.

（中文）謝謝管理層回答我的問題。我的問題是關於探探的。就在準備好的評論中，管理層談到探探的改組仍在進行中。管理階層能否談談目前的情況和我們的最終目標，以及這次改組將如何影響我們的收入和獲利能力？謝謝。

(spoken in Chinese) Tantan has achieved good results over the past two years in terms of reducing channel investment, improving channel efficiency, and driving ARPPU growth, resulting in six consecutive quarters of profit. However, its user base has not yet stabilized, and revenues have also shown a slow downward trend due to the impact of user scale. We believe the fundamental reason for this is that Tantan has not made significant breakthroughs in the core dating experience. And we need to be bolder at the product level to find product solutions that can significantly improve retention and drive organic user growth.

（中文朗讀）探探兩年來在減少通路投入、提升通路效率、拉動ARPPU成長等方面取得了良好的效果，並連續六個季度獲利。但其用戶規模仍未穩定，且受用戶規模的影響，營收也呈現緩慢下滑的趨勢。我們認為，根本原因在於探探在核心約會體驗上尚未取得重大突破。而我們需要在產品層面更大膽地尋找能夠大幅提高留存率、推動有機用戶成長的產品解決方案。

(spoken in Chinese) In this round of version upgrade, we aim to fully return to the user experience by adjusting the interface and optimize the user guidance strategy. For example, to enhance a sense of authenticity of users, we will encourage them to upload real pictures and text information by issuing trial membership benefits, and guide users to complete real-person authentication in the chat session after matching.

（中文朗讀）此輪版本升級，我們透過介面調整，優化使用者引導策略，全面回歸使用者體驗。例如，為增強使用者的真實感，我們會透過發放試用會員福利的方式鼓勵使用者上傳真實的圖片和文字訊息，並在配對後引導使用者在聊天介面完成真人認證。

Another prominent issue is that in order to improve DAU, our algorithm tries to take care of the experience of some male users who don't easily get matching opportunities. As a result, a small number of high-quality female users got excessive exposure, resulting in a large number of matches that could not be converted into chat interactions. Therefore, our algorithm team will make it easier for women to make up their minds by reducing low-quality matches, thereby improving chat conversions.

另一個突出的問題是，為了提高DAU，我們的演算法試圖照顧一些不容易獲得匹配機會的男性用戶的體驗。這樣就導致少數優質女性用戶獲得了過多的曝光，導致大量配對無法轉化為聊天互動。因此我們的演算法團隊會透過減少低品質的匹配，讓女性更容易下定決心，進而提高聊天轉換率。

(spoken in Chinese) To encourage more exploration on the product side, management does not want the team to be constrained by short-term operational and financial targets during the pilot phase of the upgrade. Therefore, we are allowing some fluctuations in user scale and revenue in the short term. We believe this is the right decision for Tantan in the long run.

（中文朗讀）為了鼓勵在產品端進行更多探索，管理階層不希望團隊在升級試點階段受到短期營運和財務目標的束縛。因此，我們允許短期內用戶規模和收入出現一些波動。我們相信從長遠來看，這對探探來說是正確的決定。

I am very pleased to see that the team is maintaining the spirit of innovation and adoption in a challenging environment. The redesign of Tantan demonstrates not only our insight into evolving user needs, but also our strong commitment to improving user experience. As for the financial part, I will leave that to Cathy.

我很高興看到團隊在充滿挑戰的環境中保持著創新和採用的精神。探探的重新設計不僅體現了我們對不斷變化的用戶需求的洞察，也體現了我們對改善用戶體驗的堅定承諾。至於財務部分，我將交給凱西 (Cathy) 處理。

Okay. For Tantan, I guess there are three things worth calling out on the financial side. One is what Sic and Tang Yan pointed toward in their comments. After a long period of trial and error, we figured that the only way out for Tantan is to not worry about short-term KPI numbers and do whatever we believe is the right thing to do in order to give the users the best dating experience.

好的。對探探來說，我認為在財務方面有三點值得注意。一是Sic和唐岩在評論中指出的。經過長時間的嘗試和摸索，我們發現探探唯一的出路就是不要太在意短期的KPI數字，而是做我們認為正確的事情，為用戶提供最好的約會體驗。

So for the coming six months or so, we are going to allow the Tantan team to put financial targets aside and set top priority on the dating experience. While I do not have full clarity at this point on where the revenue would land for the rest of the year, I guess Q2's YoY decrease could be a good reference point to project the back half of 2024.

因此在接下來的六個月左右的時間裡，我們將讓探探團隊暫時放下財務目標，把約會體驗放在第一位。雖然我目前還不完全清楚今年剩餘時間的收入將會如何，但我猜測第二季的同比下降可以作為預測 2024 年下半年的一個很好的參考點。

The second point I'd like to call out here is, while Tantan is still not ROI positive in terms of user acquisition, we believe we need to keep the marketing spend at the Q2 level for the coming couple of quarters so that the scale of Tantan will be maintained.

我想在這裡指出的第二點是，雖然探探在用戶獲取方面的投資回報率仍然不是正數，但我們認為我們需要在未來幾季將行銷支出保持在第二季度的水平，這樣探探的規模才能得以維持。

And the third thing I would like to mention here is that if you put the first thing and the second thing I mentioned just now together and try to think about the bottom line for Tantan, I think the profit will likely to decrease from the first half of the year. But for the whole year 2024, our view is that Tantan is still going to be profitable. So that's Tantan's financial outlook. Now I'm handing back to Ashley to make the call.

第三點我想說的是，如果把第一件事和我剛才提到的第二件事放在一起，想想探探的底線，我認為從上半年開始，探探的利潤可能會下降。但就2024年全年而言，我們認為探探仍將獲利。這就是探探的財務前景。現在我將把電話轉回給 Ashley。

I think, yes, this is perfect timing. So thank you for participating and we'll see you next quarter.

我認為，是的，這是完美的時機。感謝您的參與，我們下個季度再見。

Thank you. This does conclude our conference for today. Thank you for participating. You may now disconnect.

謝謝。今天的會議就到此結束了。感謝您的參與。您現在可以斷開連線。

Statements in English on this transcript were spoken by an interpreter present on the live call. The interpreter was provided by the company sponsoring this event.

本記錄中的英文陳述是由現場翻譯說出的。翻譯由贊助此活動的公司提供。