Good evening and good morning, ladies and gentlemen and thank you for standing by for 17EdTech's First Quarter 2022 Earnings Conference Call. At this time, all participants are in listen-only mode. After the management's prepared remarks, there will be a question-and-answer session. As a reminder, today's conference call is being recorded. I'd now like to turn the meeting over to your host for today's call, Ms. Lara Zhao, 17EdTech's Investor Relations Manager. Please proceed, Lara.

Thank you, operator. Hello, everyone, and thank you for joining us today. Our earnings release was distributed earlier today and is available on our IR website. Joining us today are Mr. Andy Chang Liu, Founder, Chairman and Chief Executive Officer; and Mr. Michael Chao Du, Director and Chief Financial Officer and they will walk you through our latest business performance and strategies followed by Michael, who will discuss our financial performance and guidance. They will be available to answer your questions during the Q&A session. After the prepared remarks, before we begin, I'd like to remind you that this conference call contains forward-looking statements as defined in Section 21E of the Securities Exchange Act of 1934 and the US Private Securities Litigation Reform Act of 1995. These forward-looking statements are based upon management's current expectations and current market and operating conditions and relate to events that involve known or unknown risks, uncertainties and other factors, all of which are difficult to predict and many of which are beyond the company's control. These risks may cause the company's actual results, performance or achievements to differ materially. Further information regarding these and other risks, uncertainties or factors is included in the company's filing with the US SEC. The company does not undertake any obligation to update any forward-looking statements as a result of new information, certain events or otherwise except as required under applicable law. I'll now turn the call over to our Chairman and Chief Executive Officer to review some of our business, it's development and strategic direction. Andy, please go ahead.

Thank you, Lara. Hello everyone. Thank you for joining us on our first quarter 2022 earnings call. We're pleased to report solid performance in the first quarter, but before we dive into the details, let me provide some quick highlights. First, net revenue was RMB233.4 million, 11.1% higher than the top end of the estimates provided in March. Second, our operational efficiency continued improved at the same time, resulting in a substantially narrow of GAAP business net loss compared with the same period in 2021 and this allowed us to achieve a positive adjusted net income for the second quarter in a row. Third, our new business strategies continued to gain momentum. We saw new opportunities as the COVID-19 pandemic and variable government policy helped evolve market needs and drove new demands for our service. Now, let me go into some details. We delivered solid operational and financial results. Net revenue reached RMB233.4 million, which was 11.1% higher than the high end of our guidance provided last quarter. Again, this was mentioning that this was achieved without any legacy online K-12 tutoring services revenues. Our profitability continues to improve as we continue to enhance our cost structures and operational efficiency. For the first quarter, operating expenses decreased by 82.1% year-over-year and at the percentage of the revenue as well. Although we recorded a net loss of RMB24.8 million on a GAAP business in the first quarter of 2022, we achieved RMB9.9 million of adjusted net income compared with an adjusted net loss of RMB588.8 million in the first quarter of 2021. For our teaching and learning software service business, we continue to see positive trends and demands for our offerings. Earlier this year, the Ministry of Education clearly put forward the need of speed up the implementation of digitalizing the…

Thanks Andy and thank you everyone for joining the call. I will now walk you through our financial and operating results. Please know that all financial data I talk about will be presented in RMB terms. I would like to remind everyone that the quarterly result we present here should be taken with care and references to our potential future performance are subject to impacts from seasonality one-off event as a result of the series of regulations introduced in 2021 and corresponding adjustment to our business model organization and workforces among others. The first quarter of 2022 is the first quarter of operations after we officially seized our online K-12 tutoring services and a general revenue purely from our ongoing businesses. We are delighted to report the second consecutive profitable quarter on an adjusted basis, delivering our guidance that we provided earlier. From a top line perspective, we recorded a net revenues of RMB233 and RMB0.4 million, 11.1% higher than the top end of our estimate provided earlier and it presented almost 20 times gross from the K-12 tutoring revenue of RMB11.2 million. In the first quarter of 2021. Gross margin was 6.7% this quarter, improving from 60.4% in the first quarter of 2021. Our operational efficiency continued to improve. Total operating expenses for the first quarter of '22, decreased to RMB117.8 million from RMB953.2 million in the first quarter on 2021, representing an year-over-year decrease of 82.1%. Net loss decreased significantly to RMB24.8 million for the first quarter of 2022, from $659.7 million in the same period of 2021. Net loss as a percentage of revenue was negative 10.6% the first quarter of 2022, narrowing from negative 139% in the first quarter of 2021. On an adjusted basis, our adjusting net income, which excludes share-based compensation expenses was positive…

There are no more questions on the line. I'd like to hand the call back to the management for closing. Thank you. That concludes, oh, please go ahead.

Thank you, operator. In closing on behalf of 17EdTech's management team, we'd like to thank you for your participation on today's call. If you require any further information, please feel free to reach us or reach out to us directly. Thank you for joining us today. This concludes the call.

Ladies and gentlemen, that concludes the conference for today. You may now disconnect your lines.