Amber International Holding Ltd Q3 FY2021 earnings call

• Enterprise Solutions has achieved eight consecutive quarters of record revenues, driven by strong demand for private domain traffic and online-offline integrations. - Marketing Solutions saw 11% year-over-year growth but with deceleration, affected by industry-wide challenges. - The Company adopted a strategy to balance sales growth and profitability for long-term client retention. - Showcased client case studies such as the partnership with L'Occitane for cross-border smart retail solutions and with CN Logistics for cross-border e-commerce. - Received awards including E-commerce retail in the 2021 Hong Kong Business Technology Excellence Awards and the Best Buy Side Team award from the Drum Awards for digital advertising APAC.

The Company's third quarter performance was marked by continued strong growth in Enterprise Solutions and modest growth in Marketing Solutions. iClick's Enterprise Solutions business achieved eight consecutive quarters of record revenues, growing 131% year-over-year to $20 million. Marketing Solutions revenues for the quarter grew 11% year-over-year to $67 million, which was a deceleration from prior quarters. Enterprise Solutions accounted for a significant portion of the revenue growth, while Marketing Solutions faced challenges due to industry-wide factors like shifting regulations and the uncertain macroeconomic environment.

• The Company maintained its 2021 guidance with total revenue ranging from $318 million to $338 million. - Revenue from Enterprise Solutions is expected to fall in the range of $62 million to $68 million. - The outlook is based on current market conditions and reflects the impact of the COVID-19 pandemic, with assumptions subject to change.

• Uncertain macroeconomic environment may have a wider impact across business sectors in China. - Shifting regulations and the uncertain macroeconomic environment have affected the Marketing Solutions business. - Resurgence of the pandemic could continue to impact the advertising industry.

Q: On Marketing Solutions outlook, whether the worst situation is already behind us and which verticals will be impacted more severely, and on the competitive landscape of Enterprise Solutions with Tencent and Baidu.

A: Short-term, the advertising industry will still be affected by macroeconomy and regulations, and the entire advertising industry will remain weak in the following quarters. In Enterprise Solutions, the SaaS industry in China is in its early stage of development, market is decentralized, and iClick targets key account clients with its SaaS-Plus model, seeing opportunities to cooperate with tech giants rather than compete.

Q: Impact of data privacy regulations on advertising business and update on cooperation with Baozun.

A: Tightening data regulations is good for the healthy development of the industry in the long term. The Company is compliant with data collection. has some impact on advertising precision short-term but not major long-term. Cooperation with Baozun is underway in the WeChat ecosystem to help clients with private domain e-commerce, with dedicated teams serving customers.

Q: Surprising gross margin pressure and steps to maximize long-term retention.

A: Gross margin pressure is due to the advertising industry sentiment, and the strategy is to sacrifice some gross margin to maintain long-term customer relationships. In Enterprise Solutions, there will be incremental expenses for growth and retention, but it is more abstract currently.

Q: Reason for declining gross margin this quarter.

A: Largely due to the weak sentiment in the advertising industry, intense competition, and the strategy to balance growth and gross margin by sacrificing some gross profit to maintain customer relationships