Hello, ladies and gentlemen. Thank you for standing by for 51Talk Online Education Group's Third Quarter 2023 Earnings Conference Call. At this time, all participants are in listen-only mode. Today's conference call is being recorded. I will now turn the call over to your host, Mr. David Chung, Investor Relations for the Company. Please go ahead, David.

Hello, everyone, and welcome to the third quarter 2023 earnings conference call of 51Talk. The Company's results were issued by newswire services earlier today and are posted online. You can download the earnings press release and sign up for the Company's distribution list by visiting ir.51talk.com. Mr. Jack Huang, our CEO; and Ms. Cindy Tang, our CFO, will begin with some prepared remarks. Following the prepared remarks, there will be a Q&A session. Before we continue, please note that the discussion will contain forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act 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 Form 20-F and other public filings as filed with the U.S. Securities and Exchange Commission. The Company does not assume any obligation to update any forward-looking statements, except as required under the applicable law. Please also note that earnings press release and this conference call include discussion of unaudited GAAP financial information as well as unaudited non-GAAP financial measures. 51Talk's press release contains a reconciliation of the unaudited non-GAAP measures to the unaudited most directly comparable GAAP measures. I will now turn the call over to our CEO, Jack Huang. Jack, please go ahead.

Thank you, David. Hello, everyone. Thank you for joining our conference call today. Our growth continued in the third quarter with the gross billings coming in at the high end of guidance. During the quarter, we focused on our growth activities in our selected markets where we see high potential and benefit from an early-mover advantage. In fact, we have continued to localize our materials to adapt to the local audiences. Although we are still very much in an expansion mode, we are achieving positive cash flow. Our cash increased by US$1.2 million compared to the previous quarter. We remain committed to our sustainable growth approach. In terms of technology, we focus on how Generative AI can firstly further enhance our products through more personalized and interactive functionality to help our customers practice in a more engaging way. Secondly, we deploy Generative AI to empower our service teams to guide our students and their parents more effectively through the course cycle. We equally use large language models to enhance our curriculum by creating more personalized adaptive course materials. With that, I will now turn the call over to Cindy, our CFO.

Thank you, Jack. Our business momentum carried into the third quarter as net revenues were US$7.8 million representing 25.0% sequential growth. Gross margin for the third quarter was 76.3%. Gross billings grew by 11.3%, quarter-over-quarter to US$10.9 million at the high end of guidance. Q3 operating expenses were US$9.8 million, an increase of 25.0% compared to the last quarter. Specifically, this has been driven by Q3, sales and marketing expenses of US$6.9 million, a 35.2% sequential increase from Q2, due to further increases in marketing and branding spend. Q3 product development expenses was US$0.9 million, a 25.1% sequential increase due to increased research and development projects and personnel. Finally, Q3 general and administrative expenses were US$2.0 million, slightly compared to Q2. Overall, Q3 operating loss was US$3.9 million, while net loss was US$3.9 million, a 30.5% and 33.3% sequential increase from Q2, respectively. Q3 GAAP and non-GAAP earning per ADS were negative US$0.68 and US$0.64, respectively. The company's total cash, cash equivalent and time deposits were US$22 million at the end of the third quarter. Advances from students were US$23.7 million at the end of the third quarter. Looking forward to the fourth quarter of 2023, we currently expect the net gross billings to be between US$11.0 million and US$11.5 million. The above outlook is based on our current market conditions and reflect the company's current and preliminary estimates of the market and operating conditions and customer demands, which are all subject to change. This concludes our prepared remarks. We will now open the line for questions. Operator, please go ahead.

Thank you once again for joining us today. If you have further questions, please contact 51Talk's Investor Relations for the contact information provided on our website. Thank you.

Thank you. This concludes this conference call. You may disconnect your line at this time. Thank you.