Corporate executives interpret third quarter results

Beijing time November 28 Morning News, Renren (Nyse:renn) today released the third quarter of fiscal year 2013 as at September 30, unaudited financial report.

The report showed that Renren's total net revenue in the third quarter (including sticky rice net revenues) was $47.6 million, down 5.6% from a year earlier, less than the average Wall Street analyst expected. The net revenue for everyone was $41.1 million trillion, down 9.9% from a year earlier, and the net revenue for glutinous Rice net was 6.5 million dollars, up 36% from a year earlier. The net loss for everyone in the third quarter was $24.6 million trillion, which was larger than the net loss of $15.4 million over the same period last year.

After the release of earnings, the Chairman and CEO of Chen, COO, and CFO Huang, and so on, held earnings conference calls to interpret the earnings points, and answer the analyst questions.

The following analysis is the main part of the question and answer session:

Timothy Chen, analyst at Morgan Stanley: the new mobile client of Renren Timothy Chen Mobile Communications, can you tell me the difference between this app and other widely used mobile applications in the marketplace?

Chen: The company has focused on developing this application over the past two or three quarters, and the new version has focused on mobile communications and the future of mobile apps will continue in this direction; I also mentioned that the difference between a social network on a PC and a mobile phone is communication, Social networking services for users on PCs are primarily news delivery, content and photo sharing, while on mobile phones, communication is more important; How to define communication or communication between China and America is different, in the United States, the communication is two people chat, share photos, and in the country, but also include group chat, so the new version of the group chat to join the function, It combines news delivery, content and photo sharing, as well as animations and game expressions, which are all different places for everyone to move.

Timothy Chen, analyst at Morgan Stanley, Timothy Chen: The second question about the company's game strategy, just mentioned the release of several new game products, the company will become the future of the hand platform?

Chen: The core of the company's game strategy is to push the quality of the game, especially the hand tour products, the previous several quarters of the company's game strategy has been expanded, launched a number of other projects, these projects in the long term is conducive to the development of the company, but in the short term is not imperative, , the company has put emphasis on the development of quality games.

Macquarie analyst Shao (Jiong Shao): Can you tell me about the company's independent research and development and the number of agents to tour the hand? How many of them operate on iOS and Android platforms, respectively?

Chen: At present, the company has 16 independent research and development of the game and about 51 agent games, most of the agent games are web games, hand travel very few, 16 independent research and development of the game, most of them have hand tour version; Most of the above games have iOS and Android two versions, Since the company started early this year, the Android version has been developed for all iOS versions of the game.

Macquarie analyst Shao (Jiong Shao): What is the theme of the company's hand-travel products are the game?

Chen: There are many kinds of game themes in the company, more successful simulation games and role-playing games, the company is currently developing the game mainly by three kinds of themes, one is the leisure card competition games, such games are popular in various countries, the theme of the game has several, the second is a simulation strategy game, In particular, there are several action-class simulation strategy games, the third is role-playing games, including several large multiplayer games.

Macquarie analyst Shao (Jiong Shao): Just mentioned that most of the company's hand tour products are the hands of everyone's web game version, then the future company will not develop independent of the Web game hand tour products? What is the user pay rate of the company's hand tour products?

Chen: The future companies will adhere to cross-platform strategy, most of the independent development of the game will have a hand tour version, including today's upcoming game products will have a web version, hand and tablet version of the computer, users want to be able to each day in different time period different devices can play games, the company's strategy can also provide users with convenience. The rate of user pay depends on the theme of the hand travel different and there are differences, for leisure and social type of hand travel rate is lower, such as today to release a game is a leisure game, we expect the rate will be lower, but if it is for the Ashes level players, such as simulation strategy games and action role-playing games, Then the pay rate is close to the PC game.

Macquarie analyst Shao (Jiong Shao): In addition to everyone's mobile applications, companies to promote the other channels of hand tour?

Chen: In addition to the promotion of mobile applications, the company also uses Ader mobile advertising platform to promote independent research and development and agent games, while the company is also in collaboration with some of the industry's major Android application stores to promote, including 91 wireless, excellent view browser.

Macquarie analyst Shao (Jiong Shao): Could you tell me the reason why the company sold some of its stake in glutinous rice?

Chen: First of all, we look forward to the development of the business, but also optimistic that glutinous rice will become a major group buying field, the majority of the shares sold to Baidu can bring cash and flow, and the company still retains part of the equity because of the hope that this part of the business can bring greater profits.

Alicia Yap, Barclays analyst Alicia Jappe: When will the company achieve revenue growth again? What are the strategies for the future?

Chen: In addition to continuing to improve the profitability of the gaming and advertising business, companies need to expand asset size first, mobile internet and mobile communication are important opportunities for social networking, if companies can expand users by two to three times times, future assets will become very profitable; now the company has a lot of cash and resources, We have plans to increase product online and offline marketing efforts, in fact, offline marketing has started last week, the company's previous marketing efforts are not very large, relying mainly on product word-of-mouth to achieve growth, and everyone's competitors in the marketing of a lot of investment; the company will focus on the commercialization of existing business assets, More important is to increase the number of users of mobile services; At present, most of the company's revenue comes directly from advertising, and in a recent informal meeting, some executives of advertising companies and I talked about the mobile end of the advertising business has not begun, whether for advertisers or advertising companies, so Even if the company's mobile-end assets achieve big growth, while there is no progress on the part of paying subscribers, commercialization will be slow; on the other hand, some companies that have done well in mobile communications, such as Snapchat,line and micro-letters, are promising to make a profit in the future, even if they are now in profit and loss.

Barclays analyst Alicia Jappe (Alicia Yap): Regarding the promotion, the company pays more attention to the offline channel or the pre-installed application channel?

Chen: Two are available, the company will be on the internet, mobile Internet, the application store several channels for marketing promotion, the domestic several largest application stores are promoting Renren mobile applications, this rare, the support of our products is very large; in the next two to three quarters can see the effect of the company's mobile communication strategy, for the company, This is a fundamental change, and although I have mentioned this issue since the first quarter of this year, it has finally become a reality.

Barclays analyst Alicia Jappe (Alicia Yap): About the company's video web site 56, the current site's revenue mainly from advertising, the future in the advertising revenue side of the company plans? Is there any other way to get revenue?

Mrs: 56 net revenue currently has two parts, one is the advertisement which you mentioned, the company will continue to sell the user original video advertisement resources, the second part is the Show field, this part of the business just started to operate several quarters, but the current growth is very fast, is the value-added service part growth main driving force.