Datasea Inc. Q2 FY2022 earnings call

• Datasea is China's leading 5G messaging service provider and aims to enhance brand awareness and market share. - Jointly released the first whitepaper on China's acoustic intelligence industry with relevant institutions. - Has strategic plans to promote 5G messaging, establish competitive advantages in acoustic intelligence, strengthen R&D via partnerships, expand overseas markets, and create strategic alliances. - Continues to make progress in 5G messaging, acoustic intelligence, and smart city segments with product developments and client engagements.

Datasea's segments include 5G messaging, acoustic intelligence, and smart city. For the quarter ended December 31, 2021, total revenue was $9,650,609. The 5G business contributed $9,916,811.12, with $7,786,104.56 from 5G SMS, $1,830,706.56 from 5G IMMCP mobile projects on the cloud as value-added service, and $33,797.88 from smart city projects. The 5G messaging segment is the fastest-growing, with over 100 institutional clients engaged since 2021, and contract values totaling approximately $14.73 million from October 2021 to December 2021, with $9.6 million worth of services delivered.

• Q3 revenue is predicted to be $36,435,415, a 300% growth from the previous quarter. - Expect to be breakeven in Q3 and profitable in Q4, with factors like cost spreading over more products, growing brand recognition, and expanded target customers and product forms aiding margin improvement.

• Government policy changes, though currently government policies are extremely pro-market and favorable to Datasea's business segments.

Q: Does the CEO feel confident to keep the growth rate and what made you confident?

A: Zhixin Liu is extremely confident about the growth prospect, noting government policies are extremely pro-market which is favorable.

Q: Company delivered over 7000% return growth but still at a loss. What's the cost and when to be profitable?

A: CFO mentions significant R&D spending initially, expects breakeven in Q3 and profit in Q4, with factors like cost spreading over more products, growing brand recognition, and expanded target customers and product forms aiding margin improvement.