Financial Data and Key Metrics Changes - Revenue for Q2 2023 was RMB1,553.8 million, representing a 49.7% year-over-year growth [7][21] - Adjusted EBITDA grew by 49.9% year-over-year to RMB816.1 million, with an adjusted EBITDA margin of 52.5% [7][25] - Net income increased by 9.8% year-over-year to RMB219.2 million, with a net margin of 14.1% [7][23] - Total cost of revenue increased by 51.3% to RMB911.2 million, driven by higher utility costs and depreciation [21] - Operating income increased by 43.5% to RMB445 million, with an operating income margin of 28.6% [22] Business Line Data and Key Metrics Changes - Total client demand increased by 34 megawatts in Q2, bringing total contracted and IOI capacity to 850 megawatts [7][11] - Utilized capacity increased by 48 megawatts, reaching a total of 585 megawatts with a utilization rate of 80% [7][15] - Two new projects were put under construction, increasing total capacity by 47 megawatts to 945 megawatts [6][10] Market Data and Key Metrics Changes - The Southeast Asia market was highlighted as a key driver of demand, with significant contributions from existing clients [6][12] - The commitment ratio for total capacity was 90% at the end of Q2, compared to 91% in the previous quarter [14] - Overseas business contributed to 14% of total utilized capacity, up from around 9% in the previous quarter [21] Company Strategy and Development Direction - The company is focusing on building partnerships and investing in research and development to prepare for the AIGC era [6][13] - A strategic cooperation agreement was signed with Zhangjiakou Construction & Investment Group to enhance local digital economy [19] - The company aims to achieve a 30% share of overseas business in its overall portfolio by the end of 2025 [50] Management Comments on Operating Environment and Future Outlook - Management expressed optimism about opportunities in the Southeast Asia market and is closely monitoring market conditions in China [12][13] - The company reiterated its full-year guidance for revenue and adjusted EBITDA, reflecting confidence in business momentum [7][25] - Management emphasized the importance of maintaining a healthy financial profile and continued investment in technology [13][19] Other Important Information - The company reported a total cash position of RMB5,915.3 million and a net debt position of RMB5,569.3 million [26] - The company’s assets return improved, with a pre-tax ROIC rising to 19.3% [27] - The company released its 2022 ESG Report, highlighting its commitment to energy efficiency and sustainability [17] Q&A Session Summary Question: Customer acceptance of cooling technology for AIGC - Management indicated that customers are willing to accept diversified cooling solutions due to varying geographical conditions and the increasing requirements for AIGC [29][30] - There is expected to be a marginal improvement in ROIC due to energy savings from these technologies [32] Question: Key driver of CapEx for 2023 - Management clarified that the estimated CapEx for 2023 is now expected to be in the range of RMB7 billion to RMB9 billion, driven by new pipeline projects [33][35] Question: AI-related demand and new clients - AI-related servers are estimated to account for around 5% of current overall capacity, with expectations for this portion to increase [41] - The company plans to focus solely on collocation services and not provide computing power directly [43] Question: Competition dynamics in Southeast Asia - Management acknowledged open field competition in Southeast Asia and expressed confidence in gaining a larger market share due to operational efficiency and delivery capabilities [46][48] - The goal is to achieve over 50% wallet share from the anchor customer in the Southeast Asia market [50]

Investor Presentation Disclaimer ThefollowingpresentationhasbeenpreparedbyChindataGroupHoldingsLimited(the“Company”) solelyforinformationalpurposesandshouldnotbeconstruedtobe,directlyorindirectly,inwholeorinpart, anoffertobuyorselland/oraninvitationand/orarecommendationand/orasolicitationofanoffertobuyorsellanysecurityorinstrumentortoparticipateinanyinvestmentortradingstrategy,norshallanypart ofitformthebasisof,orbereliedoninconnectionwith,anycontractorinvestmentdecisioninrelationtoanysecuritiesorotherwise. ...

Financial Data and Key Metrics Changes - Revenue for Q1 2023 was RMB1,443.5 million, representing a 56.8% year-over-year growth [10][22] - Adjusted EBITDA grew by 64.6% year-over-year to RMB813.8 million, achieving a new high margin of 56.4% [10][25] - Net income increased by 167.5% year-over-year to RMB253 million, with a net margin of 17.5% [10][23] - Operating income rose by 81.3% to RMB456.1 million, with an operating income margin of 31.6% [23] Business Line Data and Key Metrics Changes - The company added one new project, increasing total capacity by 27 megawatts to 898 megawatts [8][12] - Total utilized capacity reached 537 megawatts, with a solid utilization rate of 84% [9][17] - Client commitment rate stood at 91% of total capacity, with an additional 16 megawatts secured in Q1 [9][14] Market Data and Key Metrics Changes - Overseas business contributed approximately 9% of total utilized capacity, consistent with previous quarters [22] - The company secured a contracted capacity of around 2 megawatts for an existing Northern China project [14] - The commitment status of the asset portfolio remained healthy, with over 95% of contracts having terms of 10 years or longer [17] Company Strategy and Development Direction - The company is focused on energy-efficient data center solutions, leveraging its unique supply model and in-house capabilities [7][10] - There is a strong emphasis on accommodating AI-related demand, with plans to enhance high-density cabinet deployments [6][15] - The company aims to cooperate with partners in renewable energy generation and storage to achieve green data center objectives [43] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the healthy demand for data center services driven by advancements in AI and machine learning [6][10] - The company reiterated its full-year revenue guidance range of RMB5.88 billion to RMB6.08 billion, with an optimistic outlook for adjusted EBITDA [11][29] - Management noted that the operating cash flow has normalized and is expected to continue improving [66] Other Important Information - The company received multiple awards for its data center design, construction, and energy efficiency [20][21] - The total cash position at the end of Q1 was RMB5,769.3 million, with a net debt position of RMB5,245.4 million [27][28] Q&A Session Summary Question: Inquiry about EBITDA margin improvements - Management attributed the EBITDA margin improvement to accelerated customer move-ins, cost control, and the absence of expected diesel consumption due to unexecuted public substation revamping [31][33] Question: Concerns about net adds in capacity - Management confirmed that most new project deliveries are expected in the second half of the year, with confidence in exceeding revenue guidance due to AI-related demand [36][38] Question: Energy storage integration policies - Management highlighted the importance of energy storage systems for data centers and plans to collaborate with partners in renewable energy to enhance efficiency [40][42] Question: Clarification on revenue guidance and AIGC demand - Management indicated that the revenue guidance includes potential incremental AIGC demand, with expectations for increased demand from anchor clients [46][50] Question: Operating costs sustainability - Management noted that while operating costs may fluctuate, the overall cost control measures and stable utility costs are expected to support healthy margins [60][64]

Financial Performance - Revenue for Q1 2023 was RMB1,443.5 million, representing a 56.8% year-over-year growth[2] - Net income for Q1 2023 was RMB253.0 million, reflecting a 167.5% year-over-year increase[2] - Adjusted EBITDA for Q1 2023 increased by 64.6% year-over-year to RMB813.8 million, with an adjusted EBITDA margin of 56.4%[2] - Operating income in Q1 2023 increased by 81.3% to RMB456.1 million (US$66.4 million) with an operating income margin of 31.6%[16] - Net income in Q1 2023 rose by 167.5% to RMB253.0 million (US$36.8 million), resulting in a net income margin of 17.5%[17] - Adjusted net income in Q1 2023 grew by 77.9% to RMB315.8 million (US$46.0 million), achieving an adjusted net income margin of 21.9%[20][21] - Revenue for the three months ended March 31, 2023, was RMB 1,443,547, representing a 3.7% increase from RMB 1,390,254 for the previous quarter[39] - Net income for the same period was RMB 252,972, a significant increase of 116.7% compared to RMB 116,462 in the previous quarter[39] - Adjusted EBITDA for the three months ended March 31, 2023, was RMB 813,800, reflecting a margin of 56.4%[44] - Operating income increased to RMB 456,110 for the three months ended March 31, 2023, up from RMB 309,376 in the previous quarter, marking a 47.5% increase[39] - The net income margin improved to 17.5% for the three months ended March 31, 2023, compared to 8.4% in the previous quarter[44] Capacity and Utilization - Total capacity reached 898MW by the end of Q1 2023, a 27.6% year-over-year increase[3] - Utilized capacity grew by 12MW to 537MW, representing a 56.1% year-over-year growth, with an overall utilization ratio of 84%[7] - Total contracted and "Indication of Interest" (IOI) capacity increased by 16MW to 816MW, a 31.8% year-over-year growth[3] Guidance and Outlook - The company reiterated its 2023 revenue guidance of RMB5,880 million to RMB6,080 million and raised its adjusted EBITDA guidance to RMB3,100 million to RMB3,220 million[2] - The company updated its full-year 2023 revenue guidance to RMB5,880 million – RMB6,080 million, reflecting a 29.2-33.6% increase over 2022[24] - Adjusted EBITDA guidance for 2023 was revised to RMB3,100 million – RMB3,220 million, indicating a 31.0-35.6% increase over 2022[24] Expenses and Cash Flow - Total operating expenses in Q1 2023 decreased by 1.4% to RMB167.1 million (US$24.3 million) from RMB169.5 million in Q1 2022[15] - Research and development expenses in Q1 2023 were RMB24.9 million (US$3.6 million), a 29.5% increase from RMB19.2 million in Q1 2022[15] - Selling and marketing expenses in Q1 2023 decreased by 4.3% to RMB21.4 million (US$3.1 million) from RMB22.4 million in Q1 2022[15] - Cash generated from operating activities reached RMB 693,276 for the three months ended March 31, 2023, compared to RMB 389,401 in the previous quarter, an increase of 78.1%[41] - The company reported a net cash increase of RMB 1,705,045 for the three months ended March 31, 2023, compared to a net decrease of RMB 923,708 in the previous quarter[41] - As of March 31, 2023, the company had cash, cash equivalents, and restricted cash of RMB5,769.3 million (US$809.3 million), up from RMB4,064.2 million as of December 31, 2022[22] Awards and Recognition - The Lingqiu campus received the Data Center Design and Construction Award, highlighting the company's commitment to environmentally friendly practices[8] Financial Health - The company maintained a pre-tax ROIC of 18.7% by the end of Q1 2023, reflecting strong financial health[5] - Basic earnings per share for the three months ended March 31, 2023, was 0.35, up from 0.16 in the previous quarter[39] - The company experienced a foreign exchange gain of RMB 2,045 for the three months ended March 31, 2023, compared to a loss of RMB 4,174 in the previous quarter[39]

Financial Risks and Regulatory Compliance - The company is exposed to foreign currency risks due to a substantial portion of revenues and expenses being denominated in Renminbi, which may negatively impact financial results when translated into U.S. dollars[185]. - Compliance with U.S. public company regulations is expected to increase legal and accounting costs, potentially impacting financial results[192]. - The company may incur significant costs related to compliance with the Sarbanes-Oxley Act, diverting management's attention from core operations[192]. - Changes in China's economic and political conditions could materially affect the company's operations and financial results[204]. - The evolving legal environment in the PRC may materially affect the company's business and prospects, potentially leading to a decline in the value of its ADSs[206]. - Future regulatory changes could impose additional compliance requirements that may adversely affect the company's operations[236]. - The company may face uncertainties regarding the approval and filing requirements from the CSRC for future financing activities[259]. - The company faces potential penalties from the CSRC or other PRC governmental authorities if it fails to obtain necessary approvals for offshore equity or debt financing activities[261]. - The company must comply with SAFE regulations regarding offshore investment activities, which may expose it to liabilities if not adhered to[268]. - The company is subject to fluctuations in the Renminbi exchange rate, which could adversely affect its financial condition and the value of dividends payable in foreign currencies[265]. - Future restrictions by the PRC government on foreign currency access could limit the company's ability to pay dividends in foreign currencies[266]. Operational Challenges and Market Conditions - The merger of Chindata and Bridge Data Centres in 2019 has resulted in a limited operating history, making it challenging to predict future performance and financial prospects[189]. - The company faces risks related to natural disasters and health epidemics, which could disrupt operations and adversely affect financial condition[196]. - Political tensions between the United States and China could reduce trade and investment levels, negatively impacting the company's business and financial condition[197]. - The company faces challenges from third-party contractors who may pass on their increased labor costs, potentially raising service costs[283]. - Rising inflation and labor costs in China are expected to negatively impact profitability and growth, with average wages anticipated to continue increasing[281]. Corporate Structure and Governance - The company operates through a VIE structure, which may face regulatory scrutiny and could affect the enforceability of contractual arrangements[198]. - The registered shareholders of the VIEs may have conflicts of interest that could adversely affect the company's control and economic benefits from the VIEs[231]. - The company has no arrangements to address potential conflicts of interest between the shareholders of the VIEs and itself[232]. - The company relies on contractual arrangements that have not been tested in a court of law, which may limit its operational control[228]. - The company may lose the ability to use and enjoy the assets of the VIEs if they undergo bankruptcy or liquidation, which could materially and adversely affect its business[239]. - The company has the right to prevent unauthorized voluntary liquidation of the VIEs by requesting shareholders to transfer their equity ownership interests[240]. Taxation and Financial Implications - The company is subject to PRC value-added tax rates ranging from 6% to 13% on revenues generated from its contractual arrangements with the VIEs[227]. - The withholding tax rate of 10% applies to dividends payable by mainland China companies to non-PRC-resident enterprises, which could limit the company's ability to grow[253]. - The PRC Enterprise Income Tax Law imposes a 10% withholding tax on dividends payable to non-PRC investors, which could adversely affect non-PRC shareholders[296]. - The company may face uncertainties regarding the reporting and implications of past and future transactions involving PRC taxable assets, potentially leading to additional tax liabilities[294]. - Compliance with PRC regulations regarding indirect transfers of equity interests may result in unfavorable tax consequences for the company and its non-PRC shareholders[295]. Shareholder Rights and Market Dynamics - The company does not expect to pay dividends in the foreseeable future, relying on price appreciation for returns on investment[326]. - The dual-class structure may prevent inclusion in certain stock market indices, potentially affecting trading price and liquidity of the ADSs[322]. - Significant sales or perceived potential sales of ADSs could lead to a decline in market price[329]. - The trading volume and price of ADSs may be influenced by fluctuations in quarterly results and changes in financial estimates by analysts[318]. - The company retains discretion over dividend declarations, which may depend on future operational results and cash flow[327]. - Holders of American Depositary Shares (ADSs) may experience dilution in their holdings due to limitations on participation in future rights offerings[338]. Legal and Jurisdictional Issues - The company is incorporated under Cayman Islands law, which may complicate legal actions against it or its directors in the U.S.[350]. - The company's fifth amended and restated articles of association provide that U.S. federal courts will have exclusive jurisdiction for disputes arising under the Securities Act or the Exchange Act[357]. - The deposit agreement limits ADS holders' rights to pursue claims against the depositary, including waiving the right to a jury trial[342]. - The depositary may close its books at any time, which could limit the transferability of ADSs[349]. - Certain corporate governance practices in the Cayman Islands differ significantly from those in the United States, potentially affording less protection to shareholders[355]. Auditor and Compliance Concerns - The company’s auditor, Ernst & Young Hua Ming LLP, is subject to PCAOB inspection issues, which could lead to delisting of its ADSs if not resolved[308]. - The SEC may prohibit trading of the company's shares if its auditor is not inspected for two consecutive years under the Holding Foreign Companies Accountable Act[307]. - The company has been identified as a "Commission-Identified Issuer" due to PCAOB inspection limitations, impacting its ability to trade in the U.S. market[308]. - The inability of the PCAOB to conduct inspections could lead to a loss of investor confidence in the company's financial statements[312].

Financial Data and Key Metrics Changes - Revenue in Q4 2022 was RMB 1,390.3 million, representing a 77.8% year-over-year growth, while full-year revenue reached RMB 4,551.7 million, a 59.6% increase year-over-year [7][23] - Adjusted EBITDA for Q4 2022 was RMB 720.9 million, a 78.4% year-over-year growth, with a margin of 51.9%. For the full year, adjusted EBITDA was RMB 2,374.2 million, a 67.3% increase year-over-year [7][28] - The company expects full-year 2023 revenue to be between RMB 5,880 million and RMB 6,080 million, and adjusted EBITDA to be between RMB 3,000 million and RMB 3,110 million, indicating around a 30% increase from 2022 [7][32] Business Line Data and Key Metrics Changes - The company added 1 new project with an additional 50 megawatts of capacity in Q4 2022, bringing total capacity to 871 megawatts and total data centers to 32 [5][9] - Utilized capacity increased by 71 megawatts in Q4, totaling 525 megawatts, with a solid utilization rate of 86% [6][13] - The commitment rate for total capacity reached 92% by the end of Q4, compared to 85% in the previous quarter [12] Market Data and Key Metrics Changes - The company reported a 35.9% year-over-year increase in total client commitment, with 211 megawatts of client commitment received in 2022 [11] - Overseas business contributed to 9% of total utilized capacity in Q4, up from less than 5% in previous quarters [14][22] - The company is focusing on the Southeast Asian market, with significant projects in Malaysia and India ramping up steadily [20][35] Company Strategy and Development Direction - The company is actively participating in the national East Data West Computation Plan, planning a 150-megawatt campus in Gansu Province [18] - The management emphasized the importance of leveraging energy resources and maintaining operational efficiency to support future demand [20][36] - The company aims to achieve an additional 120 to 150 megawatts of lift capacity in the next two years, with a focus on existing anchor clients [36] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the momentum from existing clients and the long-term demand driven by emerging AI technologies [19][41] - The company is prepared for potential explosive growth in demand due to advancements in AI, particularly with clients involved in AI computing [44] - Management highlighted the importance of maintaining a healthy financial profile and operational readiness to meet future demand [31][36] Other Important Information - The company completed a $300 million senior notes offering in February 2023, which will support product development in China and overseas [6][16] - A one-off long-lived asset impairment cost of around RMB 83.5 million was recorded due to the decision to discontinue the Chinidea manufacturing business line [24][50] Q&A Session Summary Question: Breakdown of the 120-150 megawatt new booking in the next 2 years - Management indicated that 80% of the new bookings will come from existing key anchor clients, with 70% from China and 30% from overseas [38] Question: Impact of AI and data science on demand - Management believes that AI technologies will significantly increase computing power demand, benefiting the data center industry [41][42] Question: CapEx guidance for 2023 and revenue/EBITDA assumptions - CapEx is forecasted to be around RMB 5 billion, based on current business plans and project delivery schedules [49] - Management stated that the 30% revenue and EBITDA growth forecast is conservative, reflecting existing contracts and execution under construction [51][52]

Revenue Growth - Total revenue for Q4 2022 increased by 77.8% YoY to RMB1,390.3 million (US$201.6 million), driven by robust growth in colocation services[13] - Fiscal year 2022 revenue reached RMB4,551.7 million (US$659.9 million), representing a 59.6% YoY growth and exceeding guidance by 2.7%[2] - The company set its 2023 total revenue guidance at RMB5,880 million – RMB6,080 million, a 29.2-33.6% increase over 2022[25] Profitability Metrics - Adjusted EBITDA for Q4 2022 grew by 78.4% YoY to RMB720.9 million, with an adjusted EBITDA margin of 51.9%[5] - Gross profit for Q4 2022 increased by 64.4% YoY to RMB569.7 million, with a gross margin of 41.0%[16] - Operating income in Q4 2022 increased by 39.7% to RMB309.4 million (US$44.9 million) with an operating income margin of 22.3%[18] - Net income in Q4 2022 increased by 1.6% to RMB116.5 million (US$16.9 million) with a net income margin of 8.4%[19] - Adjusted net income in Q4 2022 increased by 65.2% to RMB236.2 million (US$34.2 million) with an adjusted net income margin of 17.0%[23] Capacity and Utilization - Total capacity increased by 50MW to 871MW by the end of Q4 2022, reflecting a 29.4% YoY growth[3] - Utilized capacity rose by 71MW to 525MW, representing a 72.5% YoY increase, with an overall utilization ratio of 86%[10] - The company received a total of 211MW client commitments in 2022, resulting in a year-end total client commitment of 800MW, a 35.9% YoY increase[6] - Commitment ratio for total capacity was 92% by the end of Q4 2022, indicating strong demand and client confidence[7] Expenses - Total operating expenses in Q4 2022 increased by 108.3% to RMB260.4 million (US$37.7 million) from RMB125.0 million in Q4 2021[17] - For the fiscal year 2022, total operating expenses increased by 34.3% to RMB704.4 million (US$102.1 million) from RMB524.5 million in 2021[17] Cash and Assets - As of December 31, 2022, the company had cash, cash equivalents, and restricted cash of RMB4,064 million (US$589.3 million)[24] - Total assets as of December 31, 2022, were RMB 23,100,231 thousand (US$ 3,349,219 thousand), up from RMB 18,681,951 thousand in 2021[38] - Cash and cash equivalents at the end of the period were RMB 4,987,934 thousand (US$ 589,258 thousand), down from RMB 5,241,002 thousand at the beginning of the period[40] Comprehensive Income - The company reported a comprehensive income of RMB 609,090 thousand (US$ 88,309 thousand) for the year ended December 31, 2022[39] Research and Development - Research and development expenses for the year ended December 31, 2022, were RMB 83,496 thousand (US$ 12,106 thousand), compared to RMB 75,344 thousand in 2021, indicating continued investment in innovation[39] Debt and Financing - A $300 million senior notes offering was completed on February 23, 2023, to support project development, with a coupon rate of 10.5%[3] Other Financial Metrics - Basic and diluted earnings per ADS in Q4 2022 were RMB0.32 (US$0.04) and for the fiscal year 2022 were RMB1.78 (US$0.26)[21] - The adjusted EBITDA guidance for 2023 is set at RMB3,000 million – RMB3,110 million, a 26.4-31.0% increase over 2022[25]

Financial Data and Key Metrics Changes - Revenue for Q3 2022 was RMB1,202.7 million, representing a year-over-year increase of 52.4% [9] - Adjusted EBITDA grew by 66.8% year-over-year to RMB614.5 million, with a margin of 51.1% [9][19] - GAAP net income reached RMB241 million, a 207.4% increase year-over-year, with a net margin of 20% [9][18] Business Line Data and Key Metrics Changes - Total capacity increased by 45 megawatts in Q3, reaching 821 megawatts, with 579 megawatts in service [8] - Client commitment rate remained strong at 85% of total capacity, with 96% of in-service capacity committed by clients [11][12] - Utilized capacity increased to 454 megawatts, reflecting a utilization rate of 78% [13] Market Data and Key Metrics Changes - The Greater Beijing region accounted for 75% of total capacity and 94% of utilized capacity, with the highest utilization ratio of 83% [15] - APAC projects now represent 49% of total construction capacity, indicating a growing focus on emerging markets [15] Company Strategy and Development Direction - The company aims to leverage its advantages in hyperscale business and continue investments in R&D to enhance competitive power [6][7] - Expansion plans include a focus on the APAC emerging markets, with significant capacity under construction in Malaysia and India [14][32] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustained demand, with a target of 120 to 150 megawatts of new orders annually [24][25] - The company anticipates stable power prices in the near term, with a strategic advantage in regions with abundant power supply [29] Other Important Information - The company celebrated the opening of the MY06 project in Malaysia, which has a design capacity of over 100 megawatts [14] - The company issued its third annual ESG report, emphasizing a strategy focused on zero carbon and sustainable development [16] Q&A Session Summary Question: Demand outlook and sustainability - Management confirmed no pull forward in demand and expects sustainable growth of 120 to 150 megawatts annually, with strong demand from both China and overseas markets [24][25] Question: Electricity cost trends - Management indicated that electricity costs have risen to over 30% of revenue but expect stability in the near term due to advantageous locations [27][29] Question: Move-in rate and revenue contribution from overseas - The ramp-up rate for the MY06 project is strong, with expectations for increased overseas revenue contribution in the coming years [30][32] Question: Power costs and gross margin - Management explained that the increase in power costs is due to changes in the charging mechanism in Hebei, but overall EBITDA margins remain healthy [34][36] Question: Rental price trends - Domestic contract pricing has remained stable, while overseas pricing is competitive with a pass-through model for power costs [39][41]

Revenue Growth - Revenue for Q3 2022 increased by 62.4% YoY to RMB1,202.7 million (US$169.1 million), driven by robust growth in colocation services[19] - Total revenue for the three months ended September 30, 2022, was RMB 1,202,703, representing a 62.3% increase from RMB 740,768 for the same period in 2021[45] - The company raised its full-year 2022 revenue guidance to RMB4,330 million – RMB4,430 million, reflecting a 51.8-55.3% increase over full year 2021[31] Profitability - Net income for Q3 2022 rose by 207.4% YoY to RMB241.0 million, achieving a net income margin of 20.0%[2] - Operating income in Q3 2022 increased by 72.2% to RMB317.5 million (US$44.6 million) with an operating income margin of 26.4%[24] - Adjusted net income in Q3 2022 increased by 162.8% to RMB294.3 million (US$41.4 million) with an adjusted net income margin of 24.5%[28] - Net income for the three months ended September 30, 2022, was RMB 241,036, compared to RMB 78,406 for the same period in 2021, reflecting a 207.5% increase[45] - The net income margin improved to 20.0% for the three months ended September 30, 2022, compared to 10.6% in the same period of the previous year[50] EBITDA Performance - Adjusted EBITDA for Q3 2022 increased by 66.8% YoY to RMB614.5 million, with an adjusted EBITDA margin of 51.1%[2] - Adjusted EBITDA for the nine months ended September 30, 2022, reached RMB 1,653,311, up from RMB 1,014,664 in the previous year, indicating a year-over-year increase of 62.8%[50] - The adjusted EBITDA margin for the three months ended September 30, 2022, was 51.1%, slightly down from 52.4% in the previous quarter[50] Capacity and Utilization - Total capacity grew by 45MW to 821MW by the end of Q3 2022, representing a 39.7% YoY increase[3] - Utilized capacity increased by 53MW to 454MW, reflecting a 69.3% YoY growth, with an overall utilization ratio of 78%[9] - Total contracted and Indication of Interest (IOI) capacity reached 700MW, marking a 41.9% YoY increase[8] Expenses - Total operating expenses in Q3 2022 increased by 11.4% to RMB148.7 million (US$20.9 million) from RMB133.5 million in Q3 2021[22] - General and administrative expenses in Q3 2022 increased by 36.1% to RMB116.1 million (US$16.3 million) primarily due to higher share-based compensation and professional fees[22] - Research and development expenses in Q3 2022 decreased by 18.6% to RMB17.5 million (US$2.5 million) compared to RMB21.5 million in Q3 2021[22] Cash and Assets - Cash, cash equivalents, and restricted cash as of September 30, 2022, were RMB5.0 billion (US$701.2 million), down from RMB5.8 billion as of June 30, 2022[29] - Total current assets decreased to RMB 6,347,323 as of September 30, 2022, from RMB 7,456,725 as of December 31, 2021[43] - Total liabilities decreased to RMB 8,567,319 as of September 30, 2022, from RMB 11,580,939 as of December 31, 2021[43] - Total non-current assets decreased to RMB 12,334,628 as of September 30, 2022, from RMB 14,806,755 as of December 31, 2021[43] Innovation and Technology - The company celebrated the grand opening of project MY06 in Johor, Malaysia, with a designed capacity over 100MW, including 19MW recently put into service[12] - The company’s hybrid evaporative cooling technology won a national-level award, demonstrating its commitment to innovation and efficiency[16] - The company plans to continue expanding its market presence and investing in new technologies to drive future growth[51] Shareholder Returns - The company reported a basic earnings per share of RMB 0.33 for the three months ended September 30, 2022, compared to RMB 0.11 for the same period in 2021[45]

Financial Data and Key Metrics Changes - Total capacity expanded to 776MW, an increase of 72MW during the quarter, with 30 data centers in the asset portfolio [6][7] - Revenue for the quarter was RMB1,038.1 million, representing a 51.2% year-over-year growth [8][21] - Adjusted EBITDA was RMB544.3 million, a 60.8% year-over-year growth with a margin of 52.4% [8][24] - GAAP net income reached RMB199.6 million, a 206.3% year-over-year growth, with a historical high margin of 19.2% [8][22] Business Line Data and Key Metrics Changes - Total utilized capacity increased to 401MW, a 59.6% year-over-year growth [14] - Contracted and indication of interest capacity increased by 32MW during the quarter to 619MW, leading to a commitment rate of 84% [7][11] - 95% contracted & IOI ratio for in-service capacity, consistent with the previous quarter [11] Market Data and Key Metrics Changes - APAC emerging market capacity deployment accounts for around 15% of total capacity, with 89% of this capacity committed by clients [15] - The company has 117MW capacity either in service or under construction in Southeast Asia, targeting international customers like Microsoft and Google [34] Company Strategy and Development Direction - The company is focusing on the East Data, West Computation Policy to strengthen its foothold in key regions [16] - A new agreement with the local government in Datong, Shanxi Province aims to expand capacity to over 500MW, potentially making it the largest IDC campus in Asia [17][42] - Strategic partnership with Taiji Computer aims to leverage each other's strengths in technology and market access [18][35] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in sustained demand from clients, with a conservative approach to forecasting ramp-up speeds [29] - The company maintains its full-year revenue and adjusted EBITDA guidance despite market fluctuations [40] - Management is optimistic about the Southeast Asian market, anticipating balanced demand and supply in the future [34] Other Important Information - The company closed a US$500 million syndicated loan to support further expansion [8][20] - Recent development of a waterless cooling technology, X-Cooling, aims to improve energy and water efficiency in data centers [19][68] Q&A Session Summary Question: Outlook for utilization rate ramp-up - Management indicated that the current ramp-up speed reflects strong business demand, but they will maintain a conservative nine-month forecast for moving rates [29] Question: Potential customers in Southeast Asia and competitive landscape - Management is optimistic about opportunities in Southeast Asia, with significant capacity already in place to serve international clients [34] Question: Expansion plan in Datong and utility costs - Management confirmed plans for a 500MW capacity in Datong, with adequate power supply in main campuses despite regional shortages [39][42] Question: Tax rate volatility - The tax rate varies due to operations in different countries and specific tax policies, with a compound effect from various jurisdictions [49][51] Question: Impact of market conditions on business - Management emphasized a cautious approach to forecasting, relying on actual commitments rather than industry trends [56] Question: Plans for green energy projects - The company will collaborate with partners for ecological power development in Datong, focusing on local resource utilization [64] Question: Adoption of X-Cooling technology - Management confirmed that the technology balances cost and efficiency, with significant potential for water savings [68]