Waterdrop Inc (WDH) 2023 Q2 法說會逐字稿

Good morning everyone. This is [Yi Chongjing] from Waterdrop Investor Relationships. It's my pleasure to welcome everyone to Waterdrop's second-quarter 2023 earnings conference call. All participants are in a listen-only mode in our English line. As a reminder, today's conference call is being recorded.

大家早安。我是水滴投資人關係部的[易崇敬]。我很高興歡迎大家參加 Waterdrop 2023 年第二季財報電話會議。在我們的英語熱線中，所有參與者都處於只聽模式。提醒一下，今天的電話會議正在錄音。

Please note that discussion today will contain forward-looking statements made under the safe harbor provision of US Private Securities and the litigation Reform Act of 1995. Forward-looking statements are subject to risks and uncertainties and may cause actual results to differ materially from our current expectations.

請注意，今天的討論將包含根據美國私人證券安全港條款和 1995 年訴訟改革法案做出的前瞻性陳述。前瞻性陳述受風險和不確定性的影響，可能導致實際結果與我們目前的預期有重大差異。

Potential risks and uncertainties include but not limited to those outlined in our public filings with the SEC. The company does not undertake any obligation to update any forward-looking statements, except as required in applicable law.

潛在風險和不確定性包括但不限於我們向美國證券交易委員會提交的公開文件中概述的風險和不確定性。除適用法律要求外，本公司不承擔更新任何前瞻性聲明的義務。

Also, this call includes a discussion of certain non-GAAP measures. Please refer to our earnings release for reconciliations between non-GAAP and GAAP. Joining us today on the call are Mr. Shen Peng, our Founder, Chairman and CEO; Mr. Yang Guang, Co-Founder, Director, SVP and GM of International Business; Mr. Zhu Zetao, GM of Crowdfunding and Pharmatech Business.

此外，本次電話會議也討論了某些非公認會計準則指標。請參閱我們的收益報告，以了解非 GAAP 和 GAAP 之間的對帳。今天參加電話會議的有我們的創辦人、董事長兼執行長沈鵬先生；聯合創辦人、董事、高級副總裁兼國際業務總經理楊光先生；眾籌和醫藥科技業務總經理朱澤濤先生。

Mr. [Chen Richen], Board Secretary, and we will be happy to take some of the questions in the Mandarin line at the end of the conference call.

董事會秘書陳日辰先生，我們很樂意在電話會議結束時透過國語解答一些問題。

Hello, everyone. This is Shen Peng. Thank you for joining our second-quarter 2023 earnings conference call.

大家好。我是沈鵬。感謝您參加我們的 2023 年第二季財報電話會議。

In the second quarter, in insurance and pharmaceutical industry, with the gradual enforcement of regulation, transparency and acceleration have significantly improved, effectively enhancing user experience and satisfaction.

二季度，保險、醫藥業隨著監管的逐步落實，透明度和速度明顯提升，有效提升了使用者體驗與滿意度。

This has also led compliance user insurance companies in breaking new growth opportunities. In this setting, the company's proactively [consensus] regulatory trends, responds actively to market demand, continually innovates product and optimize service [compilifying] a leading edge in these sectors.

這也為合規用戶保險公司帶來了新的成長機會。在此背景下，公司積極掌握監管趨勢，積極回應市場需求，不斷創新產品、優化服務，在這些領域維持領先優勢。

Regardless of the challenging external environment, the management is firmly convinced the adhering to long-term value and maintaining a user-centric approach will secure greater market space. And in the second quarter of 2023, the company continues to focus on creating value for our users, and continuing with healthy development.

無論外部環境多麼嚴峻，管理階層堅信，堅持長期價值、堅持以使用者為中心的理念，才能贏得更大的市場空間。2023年第二季度，公司將繼續致力於為用戶創造價值，並持續健康發展。

The financial performance remains robust, with our revenue reaching CNY679 million, carrying over an upward trend for the last five quarters, the net profit reached CNY21.7 million, demonstrating the sustainable and high-quality development of the company's operations.

財務表現依然強勁，營業收入達6.79億元人民幣，延續了過去五個季度的上升趨勢，淨利潤達2170萬元人民幣，展現了公司經營的可持續高品質發展。

With the same [cost and] net profit, the company maintains ample cash reserves. As of the end of June, the company had a total of CNY3.4 billion in cash, cash equivalents and short-term investments. The abundant cash reserves helped the company to face uncertain environment with more confidence, and support long-term trend and layout for the future growth.

在成本和淨利潤不變的情況下，公司保持了充足的現金儲備。截至6月底，公司現金、現金等價物及短期投資總額為34億元。充裕的現金儲備有助於公司更有信心地面對不確定的環境，並支持長期趨勢和未來成長的佈局。

All of our business models achieved strong performance indicators, and consolidating our leading position and influence in the industry. First of all, Waterdrop Insurance Marketplace [in things erratic] and (inaudible) has an enhanced business vitality.

我們各項業務模式都取得了優異的績效指標，鞏固了我們在業界的領先地位和影響力。首先，水滴保險市場[在事情不穩定]和（聽不清楚）的情況下，商業活力增強。

While exploring diversified customer acquisition channels, we also take in product innovation, thanks to the efforts what we call it. Both SIP and revenue made sequential growth, and it continued to contribute stable net profit to the company.

我們在探索多元化獲客管道的同時，也進行產品創新，這就是我們所說的努力。園區產能和營業收入均達到環比成長，並持續為公司貢獻穩定的淨利。

In terms of digital clinical trial solution business, due to our excellent performance, the E-find platform gains recognition from both domestic and international partners. We continue to expand the lead time and accelerating drug development for pharmaceuticals, and we've also made significant progress in CRO in Q2. Digital clinical trial solution income was CNY29.4 million and achieved a significant year-on-year growth of 167%.

在數位化臨床試驗解決方案業務方面，E-find平台憑藉著優異的表現，獲得了國內外合作夥伴的認可。我們繼續延長藥品的交付週期並加速藥物開發，我們在第二季度在 CRO 方面也取得了重大進展。數位化臨床試驗解決方案營收為2,940萬元，較去年同期大幅成長167%。

In addition, by iterating algorithms capabilities and risk management mechanism, our Waterdrop Medical Crowdfunding platform firmly adhered to transparent operations and led us to every ounce of compassion. Meanwhile, we enhanced product quality propel our service oriented business model and embodies the principle of users first service mode. Along with business development, the Company continued to invest in research and development.

此外，透過迭代演算法能力和風險管理機制，我們的水滴醫療眾籌平台始終堅持透明運營，將愛心傳遞到每個角落。同時，我們透過提升產品品質，推動以服務為導向的經營模式，體現用戶第一的服務模式。隨著業務發展，公司持續加大研發投入。

In Q2, the company continued to upgrade technologies like intelligent chatbot, deploying AI in various sectors, including operations, sales and [plays]. We strongly accelerated operational efficiency, and the company persists in explorting technology to empower the industry.

第二季度，公司持續升級智慧聊天機器人等技術，將人工智慧應用到營運、銷售、營運等各個環節。[播放]。我們大力提升營運效率，公司堅持探索科技賦能產業。

In the complex and ever changing macro environment, the company performed strong while actively operating CSR. As of June 30, 2023, the Waterdrop Charity platform has collaborated with about 110 public charitable organizations to carry out project in various areas of business, emergency, disaster relief and education support. The program has raised about CNY1.3 billion and raised the contribution from more than 65 million donors.

在複雜多變的宏觀環境下，公司在積極履行社會責任的同時，業績表現優異。截至2023年6月30日，水滴公益平台已與約110家公益組織合作，在商業、緊急、救災、教育支援等多個領域開展專案。該計畫已籌集資金約13億元人民幣，獲得超過6,500萬捐贈者的捐款。

We also continue on ESG initiatives, and strive to achieve mutual sustainable development between the company and the society. We benchmark domestic and international ESG standards to establish a compound [common] framework and publish the 2022 ESG report.

我們也持續推動ESG舉措，努力實現企業與社會共同的永續發展。我們對標國內外ESG標準，建立複合框架，發布2022年ESG報告。

The report summarizes our company's management and performance in areas like company's governance, participation in multilevel medical support system, technology innovation, green and low-carbon initiatives, and public welfare. We demonstrate the company's commitment to high quality and sustainable development.

報告總結了我公司在公司治理、參與多層次醫療保障體系、技術創新、綠色低碳、社會公益等方面的管理與績效。我們展現了公司對高品質和永續發展的承諾。

In terms of share repurchase as of the end of August 2023, the company has cumulatively repurchased 37.5 million ADS shares in the open market with cash for a total consideration of approximately USD86.1 million.

股份回購方面，截至2023年8月底，本公司已在公開市場累計以現金回購3,750萬股ADS股份，總對價約8,610萬美元。

We also want to announce the expansion of the repurchase plan, which has received approval from all our directors. Within the next 12 months, the company will repurchase shares in the open market for an amount not exceeding USD50 million. This decision is based on the company's strong confidence in our own value and long-term sustainable development.

我們還想宣布擴大回購計劃，該計劃已獲得所有董事的批准。未來12個月內，公司將在公開市場回購股份，金額不超過5,000萬美元。這項決定是基於公司對自身價值和長期永續發展的堅定信心。

Meanwhile, this share repurchase will be used for AESOP, which will further motivate our employees. That is a brief review of our business performance in Q2. Although facing the challenging macro environment, we stay fully confident in our self and the industry. Moving forward to the remaining half of this year, our strategies include business driven by a long and digital transformation.

同時，本次股份回購將用於AESOP，這將進一步激勵我們的員工。這是對我們第二季業務表現的簡要回顧。儘管面臨嚴峻的宏觀環境，我們對自己、對產業依然充滿信心。展望今年下半年，我們的策略包括長期驅動的業務和數位轉型。

Insurance systems will continue to be [synchratic], striving to achieve long-term healthy and stable development. Meanwhile, we will continue to enhance key initiatives, solidifying the business foundation and provide users with professional and software service.

保險體系將持續保持同步，並努力實現長期健康穩定發展。同時，我們將持續強化重點舉措，夯實業務基礎，為使用者提供專業化、軟體化的服務。

Secondly, the core funding business will continue to adhere in the first and iterating service model, leading the industry towards high-quality development. We will also adhere to transparent operations and inclement with risk management while actively fulfilling CSR.

二是核心融資業務將持續堅持先行、迭代的服務模式，引領產業邁向高品質發展。我們也將堅持透明營運、嚴控風險管理，積極履行企業社會責任。

Thirdly, leveraging big data, the pharmaceutical business will continue to increase industry penetration globally, and activate for a new model, in order to construct a new long-term growth engine. Fourthly, the company will make use of its ample cash reserves, and take operations and investment opportunities around insurance and healthcare sector.

第三，醫藥業務將利用大數據，持續提升全球產業滲透率，啟動新模式，建構新的長期成長引擎。四是利用充裕的現金儲備，圍繞保險、醫療健康領域掌握經營和投資機會。

Last but not least, the company will accelerate technology empowerment, and enhance AI ability to build core technology competitiveness, thereby supporting the implementation of long-term strategies and in [parent] industries.

最後，公司將加速科技賦能，提升人工智慧能力，打造核心技術競爭力，並支撐公司長期策略與產業落地。

The company will make use of its ample cash reserves and take operation, and investment opportunity around insurance and healthcare sector. In the current rate, the company will continuously derive long-term [respite] to calibrating user value, strengthening their facility and organic growth, and continue to running responsibly. We'll continue to bring insurance and healthcare best service to bring to technology.

公司將利用其充足的現金儲備，圍繞保險和醫療保健領域開展營運和投資機會。按照目前的速度，公司將繼續從長期努力中汲取經驗，提升用戶價值，加強自身設施和有機成長，並繼續負責任地運作。我們將繼續為保險和醫療保健領域帶來最好的技術服務。

And now let me give you an update on our insurance business. In the second quarter, in order to enhance service experience and enhancements, the company committed to use eccentric and high-quality development and continue to explore new service models. During Q2, we achieved CNY219.7 million in [current year urges] and margins, a 30% sequential growth. Insurance related revenue reached CNY597 million, reflecting 11% Q-o-Q for us.

現在讓我向您介紹一下我們的保險業務的最新情況。第二季度，為提升服務體驗和水平，公司致力於高品質發展，不斷探索新的服務模式。第二季度，我們的營業收入和利潤均實現 2.197 億元人民幣，較上季成長 30%。保險相關收入達 5.97 億元，季增 11%。

Short-term insurance achieved FYP of CNY1.6 billion, marking a 30% sequential growth. On one hand, the company further developed our content base in view to our activation capability. In Q2, we increased our brand exposure via client relation and spreading high-quality content across multiple platforms leading to a sequential growth in the number of end users.

短期險實現首年保費16億元，季增30%。一方面，公司針對我們的活化能力，進一步拓展內容庫。在第二季度，我們透過客戶關係和在多個平台上傳播高品質內容來增加品牌知名度，導致最終用戶數量連續成長。

On the other hand, we kept accelerating our existing customer base, leveraging AI ability. The company continues to improve the quality of user renewal rate to over 90% of short-term insurance renewal rate. Long-term insurance achieved a FYP of CNY590 million, representing a 29% sequential growth. The long-term insurance operating income increased by 38% sequentially.

另一方面，我們利用人工智慧的能力，不斷加速擴大現有客戶群。本公司持續提升用戶續保質量，短期險續保率達90%以上。長期險實現年初保費收入5.9億元，季增29%。長期保險營業收入較上季成長38%。

As long-term insurance products continue to expand, the proportion of life insurance premiums within the long-term segment has risen to 57%. During this quarter, the scale and productivity [metric] of long-term insurance need potentially, leveraging the insurance.

隨著長期保險產品的不斷擴大，人壽保險保費中長期險種的比例已上升至57%。本季度，長期保險的規模和生產力[指標]可能會利用保險。

The company elevated service model focused on common domains narrowed and intensified user education, which led to a 33% of FYP from private domain operations. The company is also experiencing called into our policy issuance leading to the sustained improvement in the first year retention rates for marketing product.

公司提升以公共領域為重點的服務模式，縮小並加強用戶教育，私有領域營運收入佔FYP的33%。該公司也經歷了我們政策發布的呼籲，導致行銷產品第一年的保留率持續提高。

In Q2, Waterdrop continues to explore new growth channels to facilitating sustainable business growth. For our online brokerage channel, FYP experienced a 113% sequential growth, with the decline in interest rates. The company developed a different new insurance, which is focused on illness insurance and life insurance to younger users in the first and second-tier cities.

第二季度，水滴繼續探索新的成長管道，促進業務可持續成長。對於我們的線上經紀管道，隨著利率的下降，首年債券環比增加了 113%。該公司開發了不同的新型保險，專注於針對一二線城市的年輕用戶提供疾病保險和人壽保險。

Sequentially, the number of users for segment insurance grew by 206%, and through high-quality content and segment proceedings, the [call cold reed] decreased by 25%. Moreover, the team improved the service process, and now can control user first time response within 20 minutes. This leads to a 2Q increase of 49% in productivity per lead and 30% in productivity capital.

環比成長206%，透過優質內容和細分領域落地，[呼冷蘆葦]用戶數下降25%。此外，團隊也改進了服務流程，現在可以控制在20分鐘內對使用者進行首次回應。這使得第二季每個線索的生產力提高了 49%，生產力資本提高了 30%。

In terms of offline agents and some market rebound and the team matured, we achieved a remarkable 206% Y-o-Y growth in FYP. We continue to enhance product offering and operational capability. We further upgraded our PD system, define functioning models, and optimizing the experience for both agents and clients.

在線下代理商和一些市場反彈以及團隊成熟方面，我們FYP實現了顯著的206％的同比增長。我們不斷增強產品供應和營運能力。我們進一步升級了PD系統，定義了功能模型，並優化了代理商和客戶的體驗。

We elevated recruiting standards, and talent in new developments, and actively explore agent IP. The average productivity per active agent increased by 201% Y-o-Y, the average number of long-term insurance policy per active agent increased by 48% Y-o-Y. During the second quarter, Waterdrop Insurance Marketplace continued to enrich its product offering, and similar product targeting the basic user growth.

我們提升了人才引進標準，積極拓展新領域，積極探索代理IP。活躍代理人人均生產力年增201%，活躍代理人人均長期保單數量較去年同期成長48%。第二季度，水滴保險市場持續豐富產品線，類似產品瞄準基礎用戶成長。

Taking regular interest in long-term production and innovation in medical treatment [abroad], we launched the BlueOcean Lifetime Health Insurance. It has allows users to take access over these medical service at an affordable price, and quickly provide an option for users to transport from shopping medical insurance directly to a 20-year long-term medical insurance, thereby [micro managing] the user coverage.

我們長期專注於[國外]醫療領域的生產與創新，推出了藍海終身健康保險。它讓用戶能夠以可負擔的價格獲得這些醫療服務，並快速為用戶提供從購買醫療保險直接轉向20年長期醫療保險的選擇，從而[微觀管理]用戶的保障範圍。

Targeting elderly, we introduced the [xiao hong bao bering 2]. This product is the first in China to cover many common serious illnesses among the elderly including malignant tumors, that was listed in the annual product innovation list by 2023 China insurance industry influence ranking.

針對老年人，我們推出了[小紅報白令2].該產品在國內率先涵蓋惡性腫瘤等多種老年常見重大疾病，入選2023年中國保險業影響力排行榜年度產品創新榜。

For healthy individual, we continue to iterating our BlueOcean series, which is the first domestic health insurance leading healthcare declaration. In Q2, this product series achieved FYP over CNY100 million. Additionally, we actively explore multichannel sales of maternity and inflammation and insurance covering medication in the operations and emergency. We saw a sequential increase in FYP.

針對健康個人，我們持續迭代藍海系列，這是國內首個健康險引領的醫療健康宣言。二季度，該產品系列首年獲利突破1億元。此外，我們也積極探索孕產婦、發炎等多通路銷售以及手術、急診用藥保險。我們看到五年計劃連續增加。

In terms of users with pre-existing conditions, we continue to lean in product supply innovation. For example, we designed a Waterdrop Carefree series, which can cover recurrence, and the FYP of existing series of the role in cancer and recurring leukemia, we are expert in the industry, receiving high recognition from patients. In terms of surgical accident insurance, we offer solution across 5,000 departments in 32 hospitals, which help patients against post operating risk.

對於已有疾病的用戶，我們持續致力於產品供應創新。例如我們設計的水滴暢快系列，可以涵蓋復發，以及現有系列的FYP在癌症和復發性白血病中的作用，我們在業界是專家，並得到了患者的高度認可。手術意外險方面，我們為32家醫院5,000個科室提供解決方案，幫助病患應對術後風險。

As a technology company, we continue to develop our insurance technology. In the second quarter, we increased AI investments, enhancing the team and upgraded our AI-empowered dialogue chatbot insurance service scenario, the chatbot can now communicate with users for more than 20 minutes.

作為一家科技公司，我們不斷開發我們的保險技術。第二季度，我們加大了AI投入，增強了團隊實力，升級了AI對話聊天機器人保險服務場景，目前該聊天機器人可以與用戶進行20分鐘以上的交流。

We have integrated the chatbot into various business scenarios, including operations, sales, and claims. This integration has effectively accelerating service product, and saved human cost.

我們已將聊天機器人整合到各種業務場景中，包括營運、銷售和索賠。這種整合有效地加速了服務產品的推出，並節省了人力成本。

In terms of technology export, we continue to strive for excellence with exporting enhancement solutions. We improved the [usable] and usability and the configurability of both wealth management and wealth tool model. Additionally, we collaborated with three new partners to accelerate the industry transformation towards digital intelligence.

在技​​術出口方面，我們不斷追求卓越，出口增強解決方案。我們提高了財富管理和財富工具模型的可用性和可配置性。此外，我們還與三家新夥伴合作，加速產業向數位智慧化轉型。

This concludes my briefing on the insurance business. So let me hand over to Zetao for an update on our Medical Crowdfunding and Digital Clinical Trial Solution Business.

關於保險業務情況的通報到此結束。因此，請容許我把時間交給 Zetao，讓他介紹我們的醫療眾籌和數位臨床試驗解決方案業務的最新情況。

Thank you, Shen Peng. As of June 30, 2023, accumulated total of 439 million people donated more than CNY60 billion to over 2.95 million patients through Waterdrop Medical Crowdfunding platform, both in-house users and crowdfunding amount continue to grow.

謝謝沈鵬。截至2023年6月30日，累計已有4.39億人透過水滴醫療眾籌平台向超過295萬名患者捐款超過600億元，自有用戶數及眾籌金額持續成長。

This quarter, in the operational transparency committee, focused on the authenticity of a claim in crowdfunding cases. Continuously enhance the governance and transformation of consultant service. In terms of asset authenticity, in order to reduce the risk of an inaccurate financial situation of crowdfunding patient families, the committee established a special live achieve [certificate] a better control which introduced the concept of core family, and the net worth of asset and income in the description of patient's family financial situation.

本季度，營運透明度委員會重點關注眾籌案例中索賠的真實性。不斷加強諮詢服務治理與轉型。在資產真實性方面，為了降低眾籌患者家庭財務狀況不准確的風險，組委會專門設立了資產真實性證明，引入核心家庭的概念，在描述患者家庭財務狀況時，將資產淨值和收入納入考量，從而更好地進行管控。

We upgraded a more accurate assessment of the reasonable target crowdfunding amount, not only adding application information and more convincing content, but also incorporating AI capability to identify both information, with further improvement of its controllability.

我們升級了對合理目標眾籌金額的更精準評估，不僅增加了申請資訊和更具說服力的內容，還融入了AI能力對資訊進行識別，可控性進一步提升。

Moreover, this approach allows for better communication between the crowdfunding services, and the donors, which shows the platform's commitment to authenticity. The committee also initiated a specialized governance targeting crowdfunding consulting behavior. We kept strengthening non-compliance conduct, such as increasing handling for valuation implementing a nationwide self-inspection in the [paneldom], combining the ability targeting higher risk scenarios.

此外，這種方法可以讓眾籌服務和捐贈者之間更好地溝通，這表明該平台對真實性的承諾。該委員會也啟動了針對眾籌諮詢行為的專門治理。我們不斷加強違規行為的處置力度，例如加強估值處理力度，在全國範圍內開展自查，並結合針對高風險場景的能力。

Meanwhile, we introduced consulting service principles such as for principal of service system, and in terms of service, the strength and proactive service awareness of consultant, and help them better addressing patient needs. Establishing accordingly service standards throughout the entire process of crowdfunding initiation, preservation, and withdrawal, and fund utilization.

同時，我們引入了服務主體制等諮詢服務原則，在服務方面，發揮諮詢師的實力和主動服務意識，幫助他們更好地解決病人的需求。建立貫穿群眾募資發起、存續、退出和資金使用全過程的服務規範。

Additionally we introduced a new consulting service evaluation system based on our user satisfaction. In terms of the transformation of offline commitment service, we successfully piloted and expanded service-oriented growth model in (spoken in foreign language), resulting in a significant increase in Net Promoter Scores within hospitals.

此外，我們也引進了基於使用者滿意度的全新諮詢服務評估系統。在線下承諾服務轉型方面，我們在（外語）成功試行並推廣服務型成長模式，醫院淨推薦值顯著提升。

We established a candidate partnership with several hospitals in service-oriented consultancy to provide assistance to both emerging sales and solutions. On one hand, our consulting system using staff with administration tech such as [hello you see reminders augmentation visuals] and providing a motion port to [renewed data] workflow of [merging them], enabling them to offer better medical care to patients.

我們與多家醫院建立了服務型諮詢候選合作夥伴關係，為新興銷售和解決方案提供協助。一方面，我們的諮詢系統使用具有管理技術的員工，例如[您好，您看到了提醒增強視覺效果]，並為[更新數據]的[合併它們]工作流程提供運動端口，使他們能夠為患者提供更好的醫療服務。

On the other hand, before patient, the role of consultant extends to a wider range of activity, like providing general advice during hospitalization, offering guidance, and commonly interpreting and implying for medical insurance policy of [why it closed] business and charitable care initiatives and so on, to embody the concept of [jingle first third for word].

另一方面，在患者面前，顧問的角色延伸到更廣泛的活動範圍，例如在住院期間提供一般建議、提供指導，以及通常解釋和暗示醫療保險政策、業務和慈善護理舉措等，以體現[叮噹聲第一段三分之一為詞]。

In terms of digital clinical trial digital solutions, the business continued to show strong growth leveraging its outstanding performance capability, the E-find platform successfully enrolled over 900 patients in Q2, marking a sequential growth of 33%.

在數位化臨床試驗數位化解決方案方面，業務憑藉卓越的績效表現持續呈現強勁成長，E-find平台第二季成功入組超過900名患者，季增33%。

We collaborated with 132 pharmaceuticals and CROs globally, made an increase of 11 partners sequentially. These figures and core recognition by our clients, as the platform's interim goal is continued to strengthen collaboration with [domestic] and pharmaceutical while strengthening the partnership with leading multination from digital worldwide.

我們與全球132家製藥公司和CRO公司合作，合作夥伴數量較上季增加11家。這些數字以及我們客戶的核心認可，因為該平台的中期目標是繼續加強與[國內]和製藥公司的合作，同時加強與全球領先的數位跨國公司的合作夥伴關係。

In Q2, the platform launched about 80 new projects. While the proportion of projects with MNC increased, the platform also achieved cooperation intention with two top 20 MNC pharmaceuticals, officially kick off the supply process, and expect to launch products in Q4.

第二季度，平台上線約80個新項目。在跨國計畫佔比提升的同時，平台也與兩家排名前20的跨國藥廠達成合作意向，正式啟動供貨流程，預計第四季上市產品。

In terms of recurring disease, the platform is further expanded in the state of chronic disease. In addition to diseases like psoriasis, atopic dermatitis, and asthma, it is due to [cure] urticaria, hepatitis B, uterine adenomyosis and rheumatoid arthritis. Both ensuring product quality, the platform's fulfillment capabilities continue to grow.

在復發性疾病方面，平台在慢性病狀態下進一步拓展。除了治療牛皮癬、過敏性皮膚炎、氣喘等疾病外，還可治療蕁麻疹、B肝、子宮肌腺症、類風濕性關節炎等。在確保產品品質的同時，平台的履行能力也不斷增強。

In Q2, the platform CRO business achieved significant progress by signing our [Guang breaking full] CRO project. The project provides comprehensive clinical trial service, encompassing data insight, medical sales, data management, statistical analysis, project management, patient to the board, patient to recruitment, patient management, and their pharmacoeconomic analysis.

第二季度，平台CRO業務取得重大進展，簽署了我們的[光破全]CRO專案。該計畫提供全面的臨床試驗服務，涵蓋數據洞察、醫療銷售、數據管理、統計分析、專案管理、患者到董事會、患者到招募、患者管理及其藥物經濟學分析。

This achievement underscores the platform's visibility for end-to-end operations in clinical trials. Meanwhile, the problem is actually exploring patient operation, leveraging its online [operationability] with partners in optimizing patient filtering, patient education, medication management, and patient data research insights and other operational activities.

這項成就凸顯了該平台在臨床試驗中端到端操作的可見性。同時，這個問題其實是在探索病人的操作，利用它的線上性，和夥伴一起優化病人篩選、病人教育、用藥管理、病人資料研究洞察等操作活動。

Regards to R&D in medical area, we continue to upgrade our medical data center, which is now capable of completing first level structuring for 10 different types of medical materials, adding approximately 600 new medical sales categories, and the level of extracting gross information such as for liver cancer.

在醫療領域的研發方面，我們持續升級醫療資料中心，目前已完成10種醫療物料的一級架構搭建，新增約600個醫療銷售類別，以及肝癌等總量資訊的擷取。

The system is now capable of automatically extracting information as disease staging, clinical staging, TNM staging, and other relevant videos provide a strong data foundation for better customer service.

該系統現在能夠自動提取訊息，因為疾病分期、臨床分期、TNM分期和其他相關影片為更好的客戶服務提供了強大的數據基礎。

Thank you for listening. I will now hand over to Yang Guang to discuss our second-quarter financial performance.

謝謝您的聆聽。現在我將把時間交給楊光來討論我們第二季的財務表現。

Thank you, Zetao. Hello, everyone. I will now walk you through our financial highlights for the second quarter. Before going into detail, please be reminded that all numbers given here will be in RMB. Please refer to our earnings release for future information on our financial performance on both the year-over-year and quarter-over-quarter basis, respectively.

謝謝你，澤濤。大家好。現在我將向大家介紹我們第二季的財務亮點。在詳細介紹之前，請注意，這裡給出的所有數字均以人民幣為單位。請參閱我們的收益報告，以了解我們未來同比和環比財務表現的資訊。

In the second quarter, all business lines were steadily responding, demonstrating strong business resilience. The company's revenue was CNY679 million, slightly lower compared to CNY711 million in Q2 of 2022, an increase by 12% comparing to CNY606 million for the Q1 of 2023.

二季度，各業務線均穩健應對，展現出較強的業務韌性。公司營收為6.79億元人民幣，較2022年第二季的7.11億元人民幣略有下降，較2023年第一季的6.06億元成長12%。

Among them, insurance-related income was CNY597 million, representing a sequential increase of 11.4%. Crowdfunding service fees were CNY$44.7 million, representing a sequential increase of 6.4%.

其中，保險相關收入5.97億元，較上季成長11.4%。眾籌服務費收入為4,470萬元，季增6.4%。

Digital clinical trial solution income was CNY29.4 million. It has increased by 28.9% sequentially and achieved a significant year-on-year growth of 167%.

數位化臨床試驗解決方案收入為2,940萬元。環比成長28.9%，較去年同期實現167%的大幅成長。

The company's overall premium cost and expenses have increased by 32.1% Y-o-Y and decreased by 20.9% Q-o-Q. Operating cost increased by 36.2% year-over-year to CNY333 million for Q2 of 2023, compared with CNY245 million for the Q2 of 2022, which was probably driven by [two] OpEx.

公司整體保費成本及費用較去年同期成長32.1%，較上季下降20.9%。2023 年第二季的營運成本年增 36.2% 至 3.33 億元人民幣，而 2022 年第二季為 2.45 億元人民幣，這可能是由 [兩項] 營運支出推動的。

CNY4.2 million increased in capable results experienced fee and CNY8.9 million increase in cost of patient recruitment consulting fees. On a quarter-on-quarter basis, operating costs increased by 34.3% in this quarter, primarily due to CNY60.9 million increased in cost of referral and service fees.

能力成果體驗費增加420萬元，病患招募諮詢費增加890萬元。本季營業成本較上季成長34.3%，主要由於推薦費及服務費成本增加6,090萬元。

S&M expense increased by 41.6% to CNY205 million in this quarter as compared with CNY144 million over Q2 of 2022 and increased by 18% compared with CNY173 million for first quarter of 2023. Both Y-o-Y and Q-o-Q increase were primarily due to the increase in third-party traffic channels.

本季銷售與市場支出為 2.05 億元人民幣，較 2022 年第二季的 1.44 億元成長 41.6%，較 2023 年第一季的 1.73 億元人民幣成長 18%。年成長和環比成長主要得益於第三方流量管道的增加。

G&A expenses were CNY96 million in this quarter, which remains stable on a quarter-on-quarter basis. R&D expense increased by 23.1% to CNY86.7 million year-over-year and increased by 10.2% on a quarter-on-quarter basis. Both the Q-o-Q and Y-o-Y increase are mainly due to the increase in R&D costs of human resources.

本季一般及行政費用為人民幣9600萬元，季增穩定。研發費用年增23.1%至8,670萬元，較上季成長10.2%。環比和年比均有所成長，主要由於人力資源研發成本的增加。

In this quarter, the Company introduced segment reporting information for the first time, bringing down our revenue and profitability into three segments: insurance, core funding and others. In summary, the insurance segment had an operating profit of CNY99.8 million, while the core funding segment incurred CNY64.1 million operating loss, and the other segment incurred a CNY47.9 million operating loss.

本季度，公司首次引入分部報告訊息，將收入和獲利能力細分為三個分部：保險、核心資金和其他。綜上，保險板塊營業利潤9,980萬元，核心資金板塊營業虧損6,410萬元，其他板塊營業虧損4,790萬元。

It is worth noticing that the company's overall profit is only driven by the insurance segment. Adjusted profit attributed to Waterdrop in Q2 was CNY50.3 million, with GAAP net profit was CNY21.7 million, and we have generated GAAP profit over the past six quarters.

值得注意的是，該公司整體利潤僅由保險業務推動。水滴公司第二季調整後利潤為5,030萬元人民幣，GAAP淨利為2,170萬元人民幣，過去六個季度我們均實現了GAAP利潤。

As of the end of June 2023, the company had combined cash, cash equivalents and short-term investment of CNY3.4 billion, indicating sufficient cash reserves. Overall, the business performance in Q2 was stable. Looking ahead, we will continue to focus on user value and sustainable high-quality development.

截至2023年6月底，公司現金、現金等價物及短期投資合計34億元人民幣，現金儲備充足。整體來看，第二季經營表現穩定。展望未來，我們將持續專注於用戶價值，實現可持續的高品質發展。

Ladies and gentlemen, with that, we will conclude today's conference call. We do thank you for joining. Have a good time.

女士們、先生們，今天的電話會議就到此結束。我們非常感謝您的加入。玩的很開心。

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人員宣讀的。翻譯由贊助此活動的公司提供。