- Total Revenues: $79.6 million, a decrease of 23.7% year over year.
- Subscription Revenues: $32.9 million, an increase of 10.8% year over year.
- Number of Subscribers: 5.71 million as of June 30, 2024, compared with 4.72 million as of June 30, 2023.
- Average Revenue per Subscriber: RMB39.5, compared with RMB42.9 in the same period of 2023.
- Cloud Computing Revenues: $26.4 million, a decrease of 13.8% year over year.
- Live Streaming and IVAS Revenues: $20.3 million, a decrease of 53.9% year over year.
- Cost of Revenues: $38.6 million, representing 48.5% of total revenues.
- Bandwidth Costs: $25.8 million, representing 32.4% of total revenues.
- Gross Profit: $40.7 million, a decrease of 11.3% year over year.
- Gross Profit Margin: 51.1%, compared with 44% in the same period of 2023.
- R&D Expenses: $17.5 million, representing 21.9% of total revenues.
- Sales and Marketing Expenses: $10.9 million, representing 13.7% of total revenues.
- General and Administrative Expenses: $11.2 million, representing 14.1% of total revenues.
- Operating Income: $1 million, compared with $0.9 million in the same period of 2023.
- Net Income Attributable to Common Shareholders: $2.8 million, compared with $5 million in the same period of 2023.
- Non-GAAP Net Income: $3.2 million, compared with $8.4 million in the same period of 2023.
- Diluted Earnings per ADS: $0.04, compared with $0.08 in the same period of 2023.
- Cash, Cash Equivalents, and Short-term Investments: $263.4 million as of June 30, 2024.
- Share Buybacks: $4.7 million spent under the 2023 program; $0.5 million spent under the new 2024 program.
- Q3 2024 Revenue Guidance: Estimated between $81 million and $86 million.
Release Date: August 13, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Subscription business demonstrated robust performance with a year-over-year increase of 10.8% in revenue.
- Successfully launched Xunlei Browser on major platforms, receiving positive user feedback.
- Gross profit margin increased to 51.1% in Q2 2024 from 44% in the same period of 2023.
- Operating income increased to $1 million compared to $0.9 million in the same period of 2023.
- Continued investments in innovation and growth initiatives, positioning the company for long-term sustainable value.
Negative Points
- Total revenues decreased by 23.7% year over year, primarily due to decreased revenues from the live streaming business.
- Cloud computing business faced challenges with a 13.8% year-over-year decline in revenue.
- Revenue from live streaming and other IVAS decreased by 53.9% year over year.
- Net income attributable to common shareholders decreased to $2.8 million from $5 million in the same period of 2023.
- Cash, cash equivalents, and short-term investments decreased to $263.4 million from $272.5 million as of March 31, 2024.
Q & A Highlights
Q: Congrats for a good quarter. Can you share any new initiatives or technologies integrated into the subscription business?
A: Xunlei has continuously evolved its subscription product to include features like downloading, acceleration, storage, and content sharing. Recently, we launched a browser that synergizes with our core business, allowing users to access resources faster and more accurately. We have received positive feedback and acquired many users without significant promotions. We are also pursuing strategic partnerships to expand product recognition and drive further growth.
Q: Another Chinese NASDAQ-listed company recently announced a dividend, boosting its share price. Considering Xunlei's undervalued stock, will the company consider similar measures to boost investor confidence?
A: Our Board of Directors has not discussed any relief measures yet. However, we will keep you updated. Currently, we are allocating our capital to exploring new initiatives and growth opportunities.
Q: What were the main factors contributing to the decline in cloud computing revenue?
A: The decline in cloud computing revenue, which was $26.4 million, representing a 13.8% year-over-year decrease, was mainly due to intense pricing competition and reduced sales volume of our hardware devices.
Q: Can you elaborate on the performance of the live streaming and IVAS business?
A: Revenue from live streaming and IVAS was $20.3 million, a quarter-over-quarter increase of 18.7% but a year-over-year decrease of 53.9%. The significant year-over-year decline is due to the strategic downsizing of our domestic audio live streaming businesses since the second quarter last year. However, our expansion into overseas markets has yielded positive results.
Q: What are the future plans for Xunlei's international market expansion?
A: We will continue exploring international markets while improving existing products and services based on user feedback and market trends. Our goal is to maintain our position as a leading distributed cloud service provider and meet the evolving needs of our users and clients.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
