Hello, ladies and gentlemen. Thank you for standing by for 36Kr Holdings Inc. 2024 First Half Year Earnings Conference Call. At this time, all participants are in a listen-only mode. After management's prepared remarks, there will be a question-and-answer session. Today's conference call is being recorded. I will now turn the call over to your host, Jianan Ding, IR Manager of the Company. Please go ahead, Jianan.

Thank you very much. Hello, everyone and welcome to 36Kr Holdings first half 2024 earnings conference call. The Company's financial and operational results were released earlier today and have been made available online. You can also view the earnings press release by visiting the IR section of our website at ir.36kr.com. Participants on today's call will include our Co-Chairman and CEO, Mr. Dagang Feng; and our Chief Financial Officer, Ms. Xiang Li. Mr. Feng will start the call by providing an overview of the Company and performance highlights of the quarter in Chinese, followed by an English interpretation. Ms. Li will then provide details on the Company's financial results before opening the call for your questions. Before we continue, please note that today's discussion will contain forward-looking statements made under the Safe Harbor provisions of the U.S. Private Securities Litigation Reform of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, the Company's results may be materially different from the views expressed today. Further information regarding this and other risks and uncertainties is included in the Company's prospectus and other public filings as filed with the U.S. SEC. The Company does not assume any obligation to update any forward-looking statements, except as required under applicable law. Please note that 36Kr's earnings press release and this conference call include discussions of unaudited GAAP financial measures as well as unaudited non-GAAP financial measures. 36Kr's earnings press release contains a reconciliation of the unaudited GAAP measures to the unaudited GAAP measures. And please note that all amount numbers are in RMB. I will now turn the call over to our Co-Chairman and CEO, Mr. Dagang Feng. Feng, please go ahead.

Hello, everyone. Thank you for joining our first half 2024 earnings conference call. Despite persistent market challenges in the first half of 2024, we delivered a solid operational performance. Our online advertising services ARPU rose by 22% year over year, while subscription services ARPU among institutional customers increased by 8% year over year, underscoring our competitive market standing. As of the end of the second quarter, we had over 33.28 million followers, sustaining our growth momentum with an increase of 9% year over year. These achievements were largely attributable to the effective execution of our three-step strategy: positioning, expansion, and collaboration. Specifically, we are deepening our focus on premium original content, enhancing our original content supply capabilities, expanding our customer base in the segments to meet diverse customer needs, and collaboratively exploring AI applications to empower a variety of business scenarios. These synchronized initiatives are boosting our operating efficiency and propelling us toward a new phase of diversified development. Let me walk you through our major progress in each of the three steps, starting with positioning. First, we continue to enhance our content creation promise, strengthening our role in the graphic content ecosystem. Harnessing the systems we have built, we have established a robust content circulation model. In the first half of the year, nearly 400 of our articles achieved over 100,000 page views. Our female content has garnered extensive industry acclaim, solidifying our industry-wide leadership in insight and influence. We also extended our appeal to younger audiences with specialized media channels, steadily diversifying our user demographic. With the launch of all new specialized accounts, we greatly enriched our content sub-verticals, extending our reach beyond new economy users to a broad spectrum of audiences interested in knowledge and entertainment. Our short video business also performed exceptionally well in the first half of the year. We actively expanded our presence across leading short video platforms, driving an increase in our short video followers to over 9.2 million, with a notable 2.3 million on Bilibili alone. We consistently impress our audience with professional, specialized insights for original videos. Additionally, we unveiled AI Car, a crash program on the auto industry's application and development of AI. We also rolled out AI Map, which tracks the latest trends in AI and constructs new blueprints for the intelligent world. This initiative notably elevated user engagement and overall experience, reinforcing our position as a top content IP creator. In the long-form video segment, we collaborated with a popular short-form video platform to launch a new season of our Elite Talk Show series in the second quarter. We made notable strides in content creation and channel distribution through this robust partnership. The debut episode featuring the founder of NIO delved into upcoming shifts in the new energy vehicle sector, garnering widespread interest with over 84 million views across various platforms. Next, in live streaming, we continually optimize our innovative offerings during the first half of the year. Training hands of industry veterans, we launched an array of entertaining live streaming programs that facilitate greater interaction and real-time connections, elevating user engagement. One prime example is our new series, The Big Deal, which features insightful conversations between industry insiders and medium curators. Another example is Business Insight Hub, a new show that focuses on capital dynamics and innovative initiatives, offering investors professional marketing intelligence. We debuted Yooz Talk, a series of face-to-face exchanges with emerging business leaders designed to enlighten users with deep multidimensional insights. Last but not least, regarding event IP, we achieved substantial success with the launch of a major event, the Advanced Productivity AI Partner Summit. In collaboration with industry giants, we delved into the latest trends in AI applications, sharing insights on growth opportunities and the challenges encountered in business operations. This event attracted an impressive million plus views, sparking extensive industry buzz. Our highly anticipated signature event returned in June 2024, offering a variety of features across the venture capital, technology, culture, and music sectors. It served as a bustling hub, fostering connections among young entrepreneurs and engaging over 50 million views, precisely targeting the younger demographic. By consistently delivering high-quality original programs and distinctive event IPs, we ensure a steady flow of premium content, garnering broad visibility and inspiring lively discussions. This approach has significantly amplified our brand power and advertising potential. Our holistic upgrade to our content and event lineup has enriched our ecosystem, expanded our user base, and cultivated more diverse content scenarios and service models for users and customers alike. Further solidifying our leadership across industry segments is key to booking user tickets. Now let's turn to the expansion aspect of our three-step strategy. Our strategic innovative content and event layout have empowered us to forge closer ties with top global brands while also accelerating growth in our customer base. In 2024, we made remarkable progress in broadening our customer segments, particularly in sectors such as food and beverage, beauty, personal care, and home appliances. Notably, new customers in the sports and outdoor category topped 60%. Our tailored approach effectively accelerated global expansion and enhanced brand influence. Meanwhile, by capitalizing on 36Kr’s substantial media influence, we continuously refined our service architecture for government and public services, offering an integrated suite of services. By maintaining a stable and high-quality customer base, we underscore our ongoing commercialization enhancement for sustained business growth. Last but not least, collaboration is the final piece of our strategy. In the first half of 2024, we expanded our collaborative efforts as we integrated technology across our business segments, achieving positive outcomes. One notable example is our strategic partnership to explore advanced applications of AI technology. We've jointly launched the AI-driven offerings, delighting users with modern, more efficient content service offerings and expanding our reach. We are confident that our enhanced content ecosystem and AI advancements will drive continued growth and improved operating efficiency. In summary, during the first half of 2024, our three-step strategy ensures solid operations that will lay a robust foundation for growth in the latter half of the year. With our innovative spirit and partnerships with global frontrunners, we aim to enhance our content offering and push the Company's high-quality, sustainable growth.

With that, I will now turn the call over to our CFO, Mr. Xiang Li, who will discuss our key financial results. Please go ahead, Xiang.

Thank you. Now, I'd like to walk you through the details of our first half of 2024 financial results. Please note all amounts are in RMB unless otherwise stated. Total revenues were RMB102.4 million in the first half of 2024 compared to RMB139.9 million in the same period of last year. Online advertising services revenue was RMB80.4 million in the first half of 2024 compared to RMB98.9 million in the same period of last year. The decrease was mainly due to the reduction in advertising spending by advertisers from certain industries and a challenging external environment. Additionally, we optimized our customer structure to control credit risk, which led to a decrease in revenue scale. Enterprise value-added services revenues were RMB13.4 million in the first half of 2024 compared to RMB26.8 million in the same period of last year. This decrease was mainly due to our ongoing service refinements, which involved reducing several regional office activities to strategically focus on cash flow and efficiency optimization. Subscription services revenues were RMB8.6 million in the first half of 2024 compared to RMB14.2 million in the same period of last year. The decrease was mainly due to the planned evolution of our premium service business model. Cost of revenues were RMB57 million in the first half of 2024 compared to RMB70 million in the same period of last year. The decrease was mainly attributable to a reduction in operating costs due to the decline in our revenues. Gross profit was RMB45.5 million in the first half of 2024 compared to RMB69.8 million in the same period of last year. Gross profit margin was 44.4% in the first half of 2024 compared to 49.9%. Operating expenses were RMB117 million in the first half of 2024, decreasing by 9% compared to RMB128.7 million in the same period of last year. Sales and marketing expenses were RMB45.4 million in the first half of 2024, a decrease of 29.9% from RMB64.8 million in the same period of last year. The decrease was mainly due to lower payroll-related expenses, rental expenses, marketing and promotional expenses, and share-based compensation expenses. G&A expenses were RMB62.8 million in the first half of 2024, a 79.9% increase compared to RMB34.9 million in the same period of last year. This increase was mainly due to an increase in allowance for doubtful accounts, partially offset by a decrease in share-based compensation expenses. Research and development expenses were RMB8.8 million in the first half of 2024, a decrease of 69.7% from RMB29 million in the same period of last year. This decrease was mainly due to a reduction in average compensation levels for our R&D personnel as we restructured our R&D team. Share-based compensation expenses recognized in cost of revenues, sales and marketing expenses, research and development expenses, and G&A totaled RMB0.05 million in the first half of 2024 compared to RMB3.7 million in the same period of last year. Other expenses were RMB24.3 million in the first half of 2024 compared to RMB6 million of other income in the same period of last year. The increase was mainly because the Company recognized about RMB25.5 million of investment losses due to fair value changes of long-term investments this year. Net loss was RMB95.9 million in the first half of 2024 compared to a net loss of RMB52.7 million in the same period of last year. Non-GAAP adjusted net loss was RMB95.9 million in the first half of 2024 compared to a non-GAAP adjusted net loss of RMB49 million in the same period of last year. Net loss attributable to 36Kr's ordinary shareholders was RMB94.4 million in the first half of 2024 compared to a net loss of RMB52.3 million in the same period of last year. Basic and diluted net loss per ADS were both RMB2.245 in the first half of 2024, compared to basic and diluted net loss per ADS of RMB1.258 in the same period of last year. As of June 30, 2024, the Company has cash, cash equivalents, and short-term investments of RMB96.9 million compared to RMB116.9 million as of December 31, 2023. The decrease was mainly attributable to net cash outflow from operating activities. This concludes all our prepared remarks today. We'll now open the call for questions.

As we are showing no questions, I'll turn the call over to the Company for closing remarks. Alright, your first question comes from Yin Rui with Sealand Securities.

Could management outline the expected growth trajectory for the advertising business? How will the Company strategize moving forward? Thank you.

We remain cautiously optimistic about future advertising growth. In terms of the strategy, we have proactively optimized our products and services to navigate ongoing macroeconomic challenges, providing deeper support to core customers, including leading internet giants. This approach has proven highly effective, driving a 20% increase in ARPU in the first half of the year. We believe there is great potential for future growth. We will continue to enrich our content ecosystem, expand our reach to new channels, and diversify our content-specific accounts to cover more sub-verticals. We are actively integrating AI technology into content production, rolling out more offerings that will allow us to engage with a broader range of companies and institutions. Our ongoing content development efforts have expanded and diversified our user base while strengthening our stable partnerships with key accounts. In 2024, we continue to broaden our premium customer segments in various sectors, achieving significant advancements.

Your next question comes from Lin with SWS Research.

What are the latest developments in short and long video segments? How about the Company's plan to expand their growth potential?

In the first half of 2024, we delved deeper into the short and long video sectors, consistently providing diverse content offerings while expanding our consumer products. Our short video contents now cover a broad spectrum, including technological innovation, business insights, and lifestyle. Our focus on short video advertising has contributed significantly to the Company's growth as it appeals to a broader customer base with higher ARPU. By leveraging our content creation promise, we have established high visibility commercialization collaborations with leading brands. Revenue performance aligns with our forecast for the year. Additionally, our lifestyle content has gained widespread visibility on major platforms. We launched programs like AI Car and AI Map, elevating user engagement and reinforcing our status as a top content creator. Our collaboration with Douyin for a new season of our Elite Talk Show series achieved over 84 million views, reflecting our successful content creation and distribution efforts.

That does conclude. There are no further questions. I'd like to turn the call back to the Company for closing remarks.

What key strategies will the Company implement to drive growth in enterprise value-added services and subscription services in the second half of the year? Thank you.

First, in response to market dynamics and evolving customer needs, we launched a major event, the Advanced Productivity AI Partner Summit during the first half of the year. The event was quite successful, attracting over 200 million views and sparking extensive industry buzz. We also supported Lenovo's efforts in organizing a roadshow by leveraging diverse promotional channels for high impact. This initiative empowered elite startups across various sectors with end-to-end services. Moving forward, we'll enhance our product metrics and services to meet evolving customer needs. In addition, we will launch new services in October this year and have more innovative offerings for our customers. We also refined our service architecture for governmental and public service systems, delivering top-tier services including facilitating industry-specific partnerships and global expansion services to fulfill our customers' needs. We are channeling strategic resources into our overseas ventures this year, establishing operations targeting Europe, leveraging our existing strengths in regional content.

Thank you for your question. Thank you once again for joining us today. If you have further questions, please feel free to contact 36Kr’s Investor Relations using the contact information provided on our website.

This concludes our teleconference today. You may now disconnect your line. Thank you.