KUAISHOU(KSHTY) - 2022 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Total revenue for 2022 increased by 16.2% to RMB94.18 billion, with Q4 2022 revenue rising 15.8% year-over-year to RMB28.3 billion [10][54][67] - Adjusted EBITDA turned positive at RMB1.81 billion for 2022, compared to a negative RMB12.95 billion in 2021 [68] - Gross profit margin expanded by 2.7 percentage points year-over-year to 44.7% in 2022 [67] Business Line Data and Key Metrics Changes - Online marketing services revenue reached RMB49.04 billion in 2022, up 14.9% year-over-year, while live streaming revenue increased by 14.2% to RMB35.39 billion [67] - E-commerce GMV for Q4 2022 was RMB312.4 billion, up 30% year-over-year, with full-year GMV reaching RMB901.2 billion, a 32.5% increase [56][67] - Live streaming revenue in Q4 2022 reached RMB10.03 billion, up 13.7% year-over-year [42][57] Market Data and Key Metrics Changes - Average Daily Active Users (DAUs) on Kuaishou App hit a record high of 366.2 million, representing a year-over-year increase of 13.3% [12] - Monthly active e-commerce paying users increased year-over-year, with a high double-digit penetration rate [40] - The number of brands with sales above RMB100 million increased by over 50% year-over-year in Q4 2022 [36] Company Strategy and Development Direction - The company aims to enhance its monetization capabilities and improve operational efficiency while focusing on building a trust-based ecosystem [50][69] - Kuaishou is prioritizing the governance of its e-commerce ecosystem and enhancing user rights and interests protection [77][78] - The strategy includes promoting brand e-commerce and leveraging high-quality KOL resources to assist with product distribution [80] Management Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the advertising market recovery in 2023, expecting a noticeable rebound in the second half of the year [87] - The company plans to continue improving customer acquisition efficiency and user retention through refined strategies and high-quality content offerings [102] - Kuaishou is confident in its e-commerce business growth outpacing the industry, driven by enhanced user shopping mentality and optimized shopping experiences [84] Other Important Information - The company reported a significant narrowing of its operating loss to RMB1.2 billion in Q4 2022, improving from RMB5.8 billion in the prior year [63] - Cash and cash equivalents stood at RMB44.7 billion as of December 31, 2022, indicating a healthy balance sheet [66] Q&A Session Summary Question: Trends in live streaming e-commerce business and competition response - Management noted that e-commerce GMV achieved healthy growth during the Chinese New Year, with strong sales in various product categories [72][73] - Emphasis was placed on building strengths in the e-commerce business rather than engaging in price wars [76] Question: Advertising customers' sentiment and revenue growth outlook - Management indicated that advertisers are cautiously optimistic about 2023, expecting a rebound in the online marketing services market in the second half of the year [87][88] Question: User growth targets and cost trends - Management highlighted robust year-over-year growth in DAUs and plans to achieve steady user growth while controlling acquisition costs [102][103] Question: Progress on new business segments like local services and Kwai Hire - Management shared that local services have significant growth potential, with a focus on enhancing user consumption mindset through online channels [108] - Kwai Hire has seen rapid progress, with average daily resume submissions doubling in Q4 2022 [114]