Good day, ladies and gentlemen. Welcome to Quhuo's Second Quarter 2021 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. If you have any objections, you may disconnect at this time. I would now like to turn the conference over to your host for today's conference call, Mr. Eric Yuan. Please go ahead.

Thank you, Operator. Hello, everyone. Welcome to Quhuo's second-quarter 2021 earnings conference call. The Company's results were released earlier today and are available on our IR website. On the call, today are Leslie Yu, Chairman, and CEO, co-founder [Indiscernible] Leslie will review the business operations and Company's highlights, followed by Sandra (ph), who will discuss financials and EBITDA. Sandra will be available to answer your questions for any session that follows. So before we begin, I would like to remind you that this call will contain forward-looking statements made under the safe harbor provisions of the Private Securities Legislation Reforms Act of 1995. Such statements are based on management's current expectations and current market and operating conditions. And related to the events that involve known or unknown risks, uncertainties, and other factors both which are difficult to predict and many of which are beyond the Company's control, which may cause the Company's actual results, performance, and achievements to differ materially from those in the forward-looking statements. Further information regarding these and other risks and uncertainties and other factors are included in the Company's filings with the U.S. 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 the law. With that, I will now turn the call over to our Chairman and CEO, Mr. Leslie Yu, please go ahead, sir.

Thank you, Eric. And I thank you for joining our Second Quarter 2021 Earnings conference call. We are pleased to report another strong quarter as total revenue grew by 81% year-over-year and almost reached the milestone of RMB one billion. Thanks to strong demand for our services and our large network of the workforce across the country. All three of our main business lines, on-demand deliveries, mobility services, and housekeeping solutions cover the needs of people's daily necessities and saw robust growth momentum in the Second Quarter. In addition, our gross profit margin quickly rebounded from the prior quarter as labor cost normalized to a standard level. As a result, we achieved an adjusted net income of RMB 10 million, a significant improvement from the First Quarter. These results reflect the economy of scale of our business model and the strong execution of our multi-scenario deployment strategy. Now, let me walk you through our key business performance in Q2. First, let's look at our biggest revenue contributor, the on-demand delivery business. As COVID -19 pandemic remains largely on the control in Q2 national-wide, albeit with some smaller-scale resurgence in a few regions. People's lives were generally returning to normal. Taking advantage of the solid demand for on-demand resources, our revenues maintained healthy growth and reached 942 million in Q2, up 74% year-over-year. The churn that we see in the current market is at a premium delivery providers like Quhuo are taking market share from crowd-sourced providers. This has given us a window of opportunity to aggressively expand our presence in existing markets and to penetrate new ones. In the Second Quarter of 2021, we provided services in 1,205 business vocals across 139 cities national-wide compared with 950 business vocals across 75 cities in the same period in 2020. For Q2,…

Thank you, Leslie. Hello, everyone. Welcome to Quhuo's Second Quarter 2021 Call. Please be reminded that -- that all amounts quoted here will be -- really be -- unless stated otherwise. Our total revenue was 991.8 million, representing an increase of 81.1% year-over-year, primarily due to the revenue growth of our major business lines. Revenues from on-demand to deliveries solutions were 942.2 million, representing an increase of 74.1% from 541.3 million in the Second Quarter of 2020, primarily due to the increase in delivery orders for sales as a result of the industrial growth in the aftermath of COVID-19 and our continued penetration and expansion into new geographic markets. Revenues from mobility service solutions consisting of share per committed and ride-hailing solutions were 25.7 million representing an increase of 336.9% from 5.9 million in the second quarter of 2020, travel-related due to our large customer base and the service Globe in shared by maintenance solutions. With the increase in the numbers of ride-hailing drivers and our platform. Revenues from housekeeping and accommodation solutions were 21.8 million, representing a significant increase from 0.4 million in the second quarter of 2020. This was primarily due to our larger customer base for probation of housekeeping and accommodation solutions including hotels and B&B as part of the network synergies, we achieved following the acquisition of Lailai and Chengtu Home. The cost of revenues was 920 million, which represents an increase of 88.8% year-over-year, primarily attributable to increased labor costs in line with our continuing business expansion. The general and administrative expenses were 84.7 million, which represents an increase of 187.2% from 29.5 million in the second quarter of 2020. The increase was primarily due to the increase in one share-based compensation from 1.32 million in the second quarter of 2020 to 44.4 million in…

Thank you, Ma'am. Ladies and gentlemen, we will now begin the question-and-answer session. Operator Instructions] We have the first question from the line of Darren [Indiscernible] from ROTH Capital, please ask your question.

Hey, good morning. Good afternoon. Thanks for taking my question. First on sort of a multi-scenario deployment. Pretty good numbers there, you said increasing like 2000 workers quarter-over-quarter. Could you talk a little bit about, one, how many cities are in now? I think on the last call you said it was 48. And then where do they stand in terms of which services they're doing? I mean, I'd have to guess that the main one's still food delivery, but is there any second one where the majority of that multi-scenario is being deployed?

Thanks for the question. And as to the next please and usually that -- we have 2 types of multi-scenario deployment and which is mainly when the caused by the -- we call this peak and load time for -- like consumers scenarios. For example, our riders for specific reasons usually be busy in the lunchtime and the evening time, and during the morning and afternoon time, normally they can be sent to do the work for the share by co-maintenance or for the share multiple maintenances for it. And on the other side for housekeeping and solution, and usually and the workers are females and they can work for the hotel, for the room cleaning, and in the noontime, and in the evening time, and they can work for like the KC or other restaurants for the restaurant cleaning. So normally, that the t major types of the multi-scenario deployment and now we also have been working with [Indiscernible] Technology and we started to build the services for family units. That's so what has majorly happened for our markets scenario in Quhuo's platform. Thank you.

Got it. And then also on the food delivery side, what was the average order value in the Quarter?

Sorry. We can't hear you clearly. Can you repeat it?

Sure. Average order value -- average revenue per order, I guess, is the way that you've defined in the past on the food delivery side. I think in Q1, it was roughly $7 -- or 750 RMB -- 7.5 RMB?

Yeah, for Q2, the average revenue of orders is 7 RMB.

Got it. And then a good lesson in gross -- gross operating margin this quarter compared to Q1, how confident are you that you can continue to grow that 7.2 figure back to sort of, I guess where you were this time last year and in the 10 to 11% range.

As we mentioned, the first quarter of last year was a special quarter due to the stay-home policy in China as a spring festival. In this quarter, as far as we are concerned, we can see that the gross margin, it's back to the normal track. For [Indiscernible] to [Indiscernible] , I am afraid I can't say or give accurate or specific guidance for the gross margin, but it won't be much different from this quarter. But it may not be that much compared to the same period of last year, especially the third quarter.

Got it. And last -- the last one for me, on the housekeeping side, have you looked into adding any more partners that can help you really -- really ramp up your scale, both geographically, but just in different penetrations in the cities, you're already in?

Yes. And actually that contract for housekeeping side, we are doing in two ways. And one way, you said that in your workforce that you facing housekeeping, and we use our [Indiscernible] use our management team, and use our clients network home facilities to help them get the work. Now they get the business and also helps them to manage the services. On the other side, we together work with property, propagate companies. For example, we work with several property management companies and together to deliver the service directly to home housekeeping. And for these property management companies, you see already managing our largest suburb area. And as the around the housing growth and they can reach but their demand we cannot meet. So during this kind of cooperation and they can provide our services to existing house-holders in the suburban area. So, that's the two major ways to currently how we expand our business in a faster way. We are using the way of cooperation with property -- existing property management companies and also, we together work with the existing hotel service providers. And on the other side, for the B&B side, we use our PMS systems to connect the tools, pass ed to the property owners and help them to better get the orders from different platforms and then provide services to them. So, in conclusion, our expansion is scheduled, as we connect different resources and based on our core competency in the management and in the technology development. Yes. Thank you.

[Indiscernible] Thank you.

Once again, ladies and gentlemen, [Operator Instructions]. We have the next question from the line of George Kessarios from Exclusive Capital, please ask your question.

You're high, even though your mobility service solutions, housekeeping, and accommodation, they're growing very, very fast, they're still very tiny or very, very small, I would say, part of your overall revenue mix. My question is, can you give us some color if these 2 segments will continue to grow as you have seen over the past year or so? And so far as housekeeping was partially answered by the previous caller, but so far as the overall growth picture, do you see these 29 segments growing in the same way over the next year or so?

I think from our side, on these two segments of housekeeping and mobility, we are growing very fast and as we can see the past a few quarters. And we can expect that -- growing speed in next quarter. And the comparing ways that, if we considering match for housekeeping and our mobility currently in China, actually that we are more like a -- we call these existing business volume. When we approached the home [Indiscernible] . we used to call plate and we use emerge. And we said the faster way for us to consolidate this resulted in short-term and then we can empower with our technology, our competence, and our management confidence. So we expect that these 2 sectors will have a much faster growth pace. The reason why we are serving the apps more is that at the same time, for our major business like [Indiscernible] is still key for faster-growing speed. So that's why we put them together, we can not see that maybe they are too small but for the growing speed, and we expect that we can contribute especially for this year and we'll have a certain significant percentage of our total revenue. Yes. Thank you.

Thank you. Just a small follow-up. Do you have an estimated TAM, total addressable market of these two segments in the markets you serve, is there some sort of estimate you guys have come up with? I mean not in Old China just where you do business. I mean it's -- if you have some

Especially for us, housekeeping market is a very large, and we call these -- in Chinese, we call these [Indiscernible] , so we're treating them to be -- Yeah, it's treating and beyond various because for this sector is not just for enterprise service needs and that is largely demanded by household family units. Currently, this market is very fragmental and especially for a household simply from standard service for their housekeeping. But unfortunately and the currency in this market and normally is individual and as the provider service for this household. And they are service-dependent and varied from different people. So, we consider this is a large market and not required -- not requested by the enterprise clients and also is very needed by the household. And they'll understand the service and they don't want to replace their housekeeping service people very frequently because it will cost much for them. And for mobility services, actually, that includes not only for the -- like we called a right of getting. And also include the share the bike, and also they include the share the modal, and the shares for this sectors, for these 3 sectors, and the upgrading very faster in China. And actually, we can say that for the ride-hailing side, and for the share the bike side. And then maybe this side's a little bit smaller than the housekeeping side, but we still consider that being lucky, yeah. Thank you.

Thank you.

[Operator Instructions] [Operator Instructions] Ladies and gentlemen, as there are no further questions, that concludes today's conference call. Thank you for participating. You may all disconnect.