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 managements’ 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 the 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 second quarter, we had over 33.28 million followers sustaining our growth momentum over that increase of 9% year over year. Those 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 the diverse customer needs and collaboratively exploring AI applications to empower a variety of the business scenarios. These synchronized initiatives are boosting our operating efficiency in propelling us toward a new phase of a 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 text in the graphic content ecosystem. Harnessing 36Kr defects of content dissemination network we have built 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 claim solidifying our industry-wide leadership in insight and influence. We also extended our appeal to younger audiences with sub-vertical media channels like [indiscernible] steadily diversifying our user demographic. With the launch of all new sub-specialized accounts, 36Kr games, we minimally enriched our content sub-verticals, extending our process segment reach beyond new economy users to a broad spectrum of knowledge and entertainment audiences. Our short video…

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

Thank you. Now, I'd like to walk you through the detail of our first half of 2024 financial results. Please note all amount 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 were RMB80.4, meaning 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 advertiser from certain industries and challenging external environment. In addition, we optimized our customer structure to control credit risk, which leads 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. The decrease was mainly due to our ongoing service offering refinements, which involved reducing several regional offices activities to strategically focus on our 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 the 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 decrease in operating costs in connect with 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…

[Operator Instructions] 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 in the Fortune 500 Companies. This approach has proven highly effective, driving a 20% increase in ARPU in the first half of the year. We believe there is a few potentials for future growth. We will also 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 also actively defending the integration of AIGC technology with the content production. Rolling out more AIGS and offerings will allow us to engage with a broader range of companies and institutions that were previously out of reach due to bandwidth and the stopping constraints. Our ongoing content development efforts have expanded and diversified our user base in the service scenarios while strengthening our stable partnerships with the key accounts like Alibaba, JD, ByteDance and Huawei. We are also consistently finding high value new customers as we cater to company's diverse content marketing needs. In 2024, we continued to broaden our premium customer segment in sectors such as food and beverage, restaurant chain, sports and outdoor beauty and personal care, home appliances and more, making great strides. We onboarded various premium global brands as partners, including Alberts, KCF, and P&G. Note fully, the proportion of the new customers in the sport and outdoor category tops 60%. Meanwhile, beauty and the personal care, new customer ratio exceed 40%, and the food and beverage along with restaurant team to record the new customer refill surpassing 20%. Thank you.

Your next question comes from Lin with SWS Research.

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

In the first half of 2024, we delved deeper into the short and the long video sectors consistently providing diverse content offerings while expanding our range of the 2C products. Our short video contents line up now covers a broad spectrum of CUC including technological innovation, business insights, lifestyle, and more. The lighting users was rich in varied content options, As we mentioned before, relative to the other advertising channels short video advertising, both the broader customer appeal and higher ARPU, which has contributed significantly to the Company's advertising revenue growth. In 2024 leveraging our content creation promise in the substantial platform influence, we established the high visibility commercialization collaborations with multiple leading brands. Revenue performance was on track with our forecast for the year. Additionally, our finance in use lifestyle content has gone the widespread visibility in the user interest of fast major platforms like Bilibili, Douyin and Kuaishou. We launched the fresh programs like AI Car and the AI Map, substantially elevating user engagement and overall experience, and reinforcing our position as a top content IP creator. By mid-year 2024, our short video followers surpassed 9.2 million and a notable 2.3 million on Bili alone, which is difficult for an institution and media company. Regarding long form video, we collaborated with popular short form video platform Douyin to launch a new season of our Elite Talk Show series, [indiscernible] in second quarter. We made notable choice in content creation and channel distribution through this robust partnership. Its debut episode featuring NIO founder, William Bin Li, ranked up over 84 million views across various platforms.

That does conclude. There are no further questions. I'd like to turn the call over back to the Company for closing remarks. Just turning over to the Company for closing remarks. Our apologies. We have another question from Lin with SWS Research.

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 IP Advanced Productivity AI Partner Summit during the first half of the year. The event was quite successful, attracting an impressive 200 million plus views and sparking extensive industry buzz. We also supported Lenovo in organizing the Lenovo New Business Innovation Ecosystem Series Roadshow, leveraging diverse channels such as 36Kr official accounts, Weibo, and community platforms for high impact promotion. This initiative empowered the elite startups across sectors, including artificial intelligence, application software, smart devices in advanced manufacturing with end-to-end services. Moving forward, we'll focus on reaching our product metrics and the services scenarios to meet our customers evolving needs. In addition, we'll launch our [indiscernible] in October this year and we'll have more innovative services for our customers in the audiences. In addition to offline events, we have consistently enhanced our value-added consulting services. In the first half of the year, 36Kr Research Institute conducted in-depth studies on emerging business models, commercial structures in the industries within the new economic sectors, issuing a range of industry research reports that offered a thorough analysis and insights on the trends and the prospects in artificial intelligence, digitalization, global expansion in the customer sectors. We also refined our service architecture for governmental and the public service systems this year, harnessing our best understanding of the intricacy of the governmental customers. Along with our broad basis service experience, we delivered a host of top year services, including facilitating industry specific partnerships, investment inflow in the global expansion service to fulfill our customer's very needs. Given that globalization is an irreversible trend, we are channeling considerable strategic resources to our overseas ventures this year. For instance, we are establishing meeting operations targeting Europe in this September, leveraging 36Kr’s existing strength in our regional content in the integrating AI technology to enable real-time dissemination of a high volume of content to Europe, while also bring the latest European news back to China. As we expand our network worldwide, we will work with the Chinese government entities and the businesses to establish 36Kr global expansion service centers.

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 to the contact information provided on our website.

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