Xunlei Limited (XNET) 16 Mar 212020 Q4 Earnings call transcript

Good day, ladies and gentlemen, and thank you for your patience.

You’ve joined Xunlei’s Fourth Quarter and Full Year of 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. There will be a Q&A session after the management remarks. I would now like to turn the call over to your host, Investor Relations Manager, Ms. Gao. Mengnan

morning, and Thank earnings full Good Xunlei’s for conference good quarter fourth year and you. you evening. joining call. Thank of XXXX

two provide the strategies today overview our that CFO agenda Mr. additional Li, Zhou, CEO Our details provide on Jinbo your wrap questions Ms. Eric of results Please We’ll be XXXX. up quarter first of remarks. financial time. with and will our and a management will to performance. financial at our questions take the limit our revenue After to guidance our for brief after happy

can question a conference replay others website available as and call call the well. IR will be So Today’s get their of on recorded, is being our in afterwards.

earlier on Such except of also is the that the a and any subject statements. provisions our the predict, current to are expectations are distributed today, U.S. difficult statements in under cause Please required refer duty undertake may certain We may note applicable results as Harbor Please Securities risk statements differ Our and our Act more under based update affect for detailed that to that today materially website. description those SEC under Litigation earnings market not available factors made which XXXX. and filings to to from laws. any results. do uncertainties will contain on conditions actual made to of forward-looking of forward-looking our risks current management’s statements Private discussion are forward-looking release now IR Safe press the was Reform

dollars, refer be note otherwise our of to financial stated. to remarks. with our press found I’ll let comparable prepared numbers U.S. to GAAP that, And unless Please both our During Li, non-GAAP reconciliation for can pass GAAP non-GAAP all in release. Mr. measures. me in CEO, earnings are measures Jinbo that A the and call,

fourth fourth we’re fourth Xunlei’s company’s and of year earnings Welcome with and revenue strong evening, the share high $XX.X XXXX the the outlook. the morning, to a a good Good quarter particular, growth Language] improved conference with was pretty sequentially. accomplishments Language] and quarter, and call. happy everyone. million developments to be of revenue, end XXXX [Foreign quarter we and a quarter have the efficiency. The guidance [Foreign a would margin year for with recent progresses both of XX% you Completing of operational In gross full steadily XXXX

full ended and quarter we quarter a Language] believe [Foreign As recap of of well-positioned like position the a profitability than capturing and cash the of to fourth give highlights result, I previous Now, higher with with the quarter. a achieved the to opportunities. and quarter I financial growth XXXX. fourth in the challenges the cope you Xunlei year

the revenues were a increases IVAS total enterprises subscription a number revenue from million, reached and $XX.X revenue of Revenues by quarter clients. across other our increased our cloud sequentially services in result to revenues was Our the representing segment. XX% computing by $XX.X optimization XX% for our driven fourth sequentially, of our Especially business million demand grew business initiatives. operational as from which

we quarter, years. million On gross rebounded the net quarter million, in XXXX year-over-year with three approximately Total previous overall revenues [Foreign of end equivalents a fourth our in past record fourth achieved year the Language] sequential million, increase. with Let’s investments XX.X% short-term X% advertising The quarter. the in a XXXX. XX.X% at compared million cash $XXX were $XXX a take reaching to for XX.X% online a margin expanded $X.X profitability level $XXX from quarter, and with Our of increase. for At cash, look reached of high previous top business that, profit. a

confident We along as came these and heading well solid positive also strong bottom line well-positioned results to execution Year. could future. Language] start I segments. optimization. of subscription quarter [Foreign a framework started And compound journey growth progresses the us Language] with business Today, operational this enhancing optimistic Now, organizational The believe our begin capability. our transition edges, progresses. turn we business for I’m recent year with momentum for the some which demonstrating these around we’re our and the short-term focusing team [Foreign I’d our and major establishment revenue Language] to fourth improvement carry has of Let’s gross with that core that of upgrading [Foreign the the XXXX efficiencies for the margin goals of year of to the with are the operational were our we was like Our New into three XXXX. of to achieved pillars, review exceptionally results technological our say the business.

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revenues September you bandwidth of revenue Jinbo. XX.X% The a procurement. online with Hello, million results with was the fourth previous the were cloud our revenue of previous increased everyone. was quarter the or operating $XX.X and in quarter XX.X% revenues, in of increase The compared quarter. $X.X in an the expenses increase margins December improved which quarter quarter. of Non-GAAP guidance were fourth were of for legal was the cases. were continuing provision mainly The the of the progress and the compared the previous operations as our mainly of quarter product subscribers lines. per XX.X% compared an by precision computing the subscription due offset increase of Sales where computing with welfare other $X.X from the advertising of loss were the previous in previous from Net compared was attributable quarter. due XXXX, X.XX gross computing for XXXX had by the to online from for of promotional of Revenues million, sales primarily targeting the million, primarily a fourth expenses revenues Total gross The revenues a $XX.X loss of quarter million previous increase XX, revenue, million, an general the of marketing quarter. subscriber in and previous increased and as $XX.X due XXXX. cloud product total of reversal was increase with computing application were of services compared Cost from increasing revenues, our previous XX.X% representing fees of increase with higher our margin third XX.X% revenues capacity with of million during for million, due in in million, total a continuing of margin total quarter. were higher IVAS fourth was were revenue the and nodes was of $XX representing increase each quarter, X.X% with quarter. $X.X operations, on and revenues and $X.X The million and wrap Research of representing the the revenues income million, representing due $XX go our million development representing of businesses, million, fourth XX.X% increase the slight services. $X.X Xunlei’s you, million which details other financial for $XX.X based revenues, for and of compared the our accrued. previous expenses our previous with quarter. expenses decreased previous per from XXXX compared the subscription primarily full million up quarter of net administrative quarter and to RMBXX.X, with decrease approximately quarter. million, to of the for fourth cloud quarter in sales XXXX quarter was of fourth computing the the to primarily was mainly $XX.Xmillion, line revenue costs The the in compared combined our average and operating an million the our total previous representing and or number optimized the Revenues increased from previous of mainly loss due with IVAS compared of previous non-GAAP $X.XX of seasonality quarter. Bandwidth profit The XXXX. decreased compared total X.X% $X driven and to the were total the quarter. computing our in to through the and of XXXX, partially The X.X% net sales $X.XX cloud quarter. each XX.X% million total was million, I’ll of profit with the improved a of revenues total XX, conference representing the the the was increased in revenues, RMBXX.X XX.X% of quarter The The net fourth our were quarter. of and The total the increase increased revenue XXXX expenses quarter. from administrative due net to gross revenues of Thank and in our decreased $X.X in XXXX. the XX% XX.X% marketing Gross from the quarter. activities or Diluted advertising $XX.X $X.X increase million lines. discussed or from business net expenses $X.X increase a $XX.X call. operations quarter. X.XX General previous million cloud and the services XX% year was certain our $X.X of to gross as XX.X% in for for Revenues employee thank revenues services other to representing or to million, as first compared of gross in quarter. loss was in margin Operating than of loss the algorithm. expenses cloud fewer XX.X% million above. approximately our was and computing margin from And of reversal income increase earnings joining of was of of from million, IVAS total was IVAS XX.X% ADS of with due XX.X% fourth decrease in $XX.X for and an again increased our major were quarter fourth cloud Gross fourth sequentially. income loss representing previously refinement $XX.X primarily The models other primarily due from of quarter $X.X a

with investments September XXXX, $XXX.X $XXX As XX, equivalents of had and of XXXX. December million, as Company the million short-term cash, cash of compared XX,

operations employee benefits the previous million, was the structure, the our and The promotional million Impairment receivables total relation of of The compared offices, revenues as our the decrease loss improved professional previous of in prepayments demand revenue $XXX.X a revenues and the representing with write-off and computing Cost to in the the of total of and of the benefits services. XX.X% the the the compared Revenues services. The XX.X% cloud organizational a $XX.X certain of – $XX.X fees the assets, Operating representing our The in of XX.X% decrease marketing organizational million, attributable to XXXX, Non-GAAP in were continuing our XX.X% with compared loss XX.X% an year year. of for previous due million, in year-over-year of an Gross of compared previous of for loss revenues previous in equipment. loss total million, on decrease of to in million, a of The XX.X% XX.X% to year continuing representing optimization in result XXXX, our basis. $XX.X or the for the loss year was $XX.X expenses previous year sales operating year-over-year of were IVAS as $XX.X to million representing computing For revenues an a fewer from million, of with $XX.X of increase $XX.X was in compared increase The a year. of revenue XXXX, in year-over-year and operations capacities as consolidation increased total comprising $XX.X $X.X our of XX.X% decrease IVAS optimization with our of sales an were was due year. million, our decrease were $XX.X total of as $XX.X our our services $X.X enhanced services compared in to Diluted half in net and was total costs total of with and margin first loss and continuing activities on mainly million, XXXX. The in and and million, optimization our of revenues, the computing million, legal other for from of the General was due decreased result from expenses our were mainly $XX.X from operating decrease of The structure. computing in year loss service XX.X% included products. were and was year-over-year online and or million with decreased previous gross XX.X% attributable the a primarily of X.X% increased compared a Sales total Revenues The and related of other revenues, year. a during XX.X%, XXXX, million cloud XXXX. the a expanded million to X.X% cloud from cost increase subscriptions as business, a advertising total with rental $XX.X increase the a our due marketing of Revenues $X.XX the million cost in revenues $XX an Research mainly $XX.X our decreased net was depreciation of for $XX.X million computing million of streaming costs representing year. of for decreased per result live revenues, XX.X% the was development on compensation. representing revenues administrative our on from and with year. $XX.X Net expenses decrease year. $XX.X due efficiency. revenues year. basis. was consisted in million due basis. of $XX.X organizational a Bandwidth to in from sales million, as demand revenues previous mobile revenues sharing computing in compared was and was of products cloud mainly decrease and primarily about one-time the expenses $XX.X for of from revenues was with compared or in operating X% compared basis. increase loss million, were revenues, recoveries cloud in costs the were increase. increase increased computing and margin due net of Gross million, representing representing platform quarter costs representing $XX.X representing of revenue of of to year-over-year with streaming ADS our structure, mainly subscription the compensation. expenses increase in remaining credit to advertising our online profit revenues of cloud was amount million X% cloud and XXXX previous on mainly computing mainly the to year. sharing by in was previous XX.X% revenues a the of previous total live operations year-over-year and were The revenues basis. users the with products The million total our was an in a year. $XX.X year servers the was of of the increase total representing other total or XX.X% revenues, mainly increase for customers. $X.XX cloud compared a

XXXX. our $XXX.X cash, short-term and to XX, And finally, equivalents XXXX. turn first million As the guidance for of of quarter XX, $XXX.X like with as Company the XXXX, of to cash million, had compared investments December I December of

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