Here Group Ltd. Q3 FY2024 earnings call

• Continued to expand course offerings for the elderly learning market, with efforts to monetize user base. Gross billings from individual online learning services grew YOY. - Launched new courses for elderly users like Ba Duan Jin exercise and mini lectures. - Invested in short video courses, seeing increased user engagement and satisfaction. - Expanded e-commerce business targeting elderly users, with healthcare products generating GMV. - Overseas expansion with Kelly's education platform in Hong Kong, including opening the first offline school and planning to open an office in June.

For the third quarter of Fiscal Year 2024, total revenues were RMB 945.6 million, up 17.1% year-over-year. Revenue from individual online learning services grew 14.3% year-over-year to RMB 828.1 million, accounting for 87.6% of total revenues. Their gross billings from individual online learning services were RMB 981.5 million, a 22.1% year-over-year growth. Revenue from enterprise services was RMB 650.1 million, up 19.8% year-over-year, representing 6.9% of total revenues.

The company expects revenues for the fourth quarter of Fiscal Year 2024 to be between RMB 900 million and RMB 930 million, representing a year-over-year increase of between 8.7% and 12.53%.

Q: Given economic challenges in China and strength of QuantaSing's balance sheet, any opportunity to accelerate e-commerce business offerings?

A: While the balance sheet is a solid foundation, launching new business also requires understanding customer demands and behaviors, and testing and scaling the business model. Efforts in catering to elderly customers' demands, like private label products, will take time.

Q: Will you be expanding the offline education services of Kelley education over the next couple of years?

A: Continuously assess opportunities to enhance service offerings, with primary focus on online learning but recognizing value of offline learning, and will explore expanding offline presence for Kelley education.

Q: How will AI impact offerings and financials long run?

A: AI is used to personalize learning journeys, optimize platform efficiency, and ensure content quality. Long term, AI-driven efficiency measures may lead to cost savings, and enhanced user experience may drive revenue growth.

Q: Plan to build brand strength for private label products?

A: Ensure private label products reflect brand values and quality. Leverage digital marketing, social media, influencer partnerships, and focus on customer feedback to build brand awareness and loyalty.

Q: Outlook for future registered users and quarterly revenue?

A: QuantaSing has a solid user base from middle-aged and elderly, with potential for continued growth by leveraging existing infrastructure and cross-selling. Future revenue will be driven by expanding offerings and leveraging user base.

Q: Plans to deploy cash on balance sheet?

A: Considering macro environment and business expansion, may deploy cash in new initiatives like private label products, marketing, and possibly share repurchase, while maintaining conservative approach for sustainable growth.