DouYu International Holdings Limited Q3 FY2024 earnings call

• Focused on maximizing core competitive edge, enhancing commercialization capabilities, and diversifying revenue streams. - Mobile MAUs were 42.1 million, down 18.6% y-o-y due to competition from short video platforms, but core user engagement remained stable. - Broadcasted nearly 30 large-scale official tournaments, rolled out innovative derivative content. - Enhanced gaming content commercialization through collaborations with game developers and successful game-specific membership and promotional models. - Refined streamer management strategy, including ROI analysis, revised compensation criteria, and successful summer recruitment campaign with improved retention and ROI. - Addressed macroeconomic impact on user spending by introducing budget-friendly paid products.

Total net revenues decreased by 21.8% year-over-year in the third quarter to RMB 1.06 billion, but saw a 3% quarter-over-quarter increase. Live streaming revenues were RMB 0.75 billion, down 34.7% y-o-y. Innovative business, advertising and other revenues increased significantly by 49.4% to RMB 311 million, contributing 29.3% of total revenue. Cost of revenues decreased by 14.1% to RMB 1 billion. Gross profit was RMB 60.8 million, with gross margin at 5.7%. Operating expenses were reduced, with sales and marketing, R&D, and general and administrative expenses all seeing declines.

• Continue to use new revenue streams to drive growth. - Focus on cost efficiencies to mitigate near-term financial pressure. - Pursue new growth opportunities and reinforce fundamental strengths for sustainable platform development and stakeholder value.

• Fierce market competition from short video platforms impacting user base. - Softer macroeconomic environment affecting user spending on live streaming. - Challenges in live streaming business growth due to competitive landscape and macroeconomic factors.

Q: Regarding live streaming business, how to look at future growth and strategic changes?

A: Faced challenges from competition and macroeconomic environment. Adjusted user acquisition strategies, focused on retaining core users, upgraded content strategy, and diversified revenue through game props. Leveraged partnerships with game developers for game prop commercialization.

Q: Strategy to optimize cost structure and streamers' operations?

A: Refined content cost control, adjusted streamer compensation framework, renegotiated contracts, and recruited new streamers. Measures aimed at improving efficiency and cost control while preserving content quality.

Q: Performance of Black Myth: Wukong on DouYu platform?

A: Black Myth: Wukong drove traffic growth, with 23% of streamers on DouYu live streaming it on launch day, nearly half of daily active users viewing Black Myth content. Employed diverse content strategies and guided users to other gaming segments for retention.