Ladies and gentlemen, thank you for standing by, and welcome to Sunlands' Third Quarter 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. After prepared remarks by the management team, there will be a question-and-answer session. Today's conference call is being recorded. If you have any objections, you may disconnect at this time. I would now like to turn the call over to our host today, Yuhua Ye, Sunlands' IR Representative. Please go ahead.

Hello, everyone, and thank you for joining Sunlands' Third quarter 2020 earnings conference call. The Company's financial and operating results were issued in a press release via newswire services earlier today and are posted online. You can download the earnings press release and sign up for our distribution list by visiting our IR website. On the call, our CEO Tongbo Liu will provide an update on our operational performance, as well as our strategic initiatives. Our CFO Selena Lu will give you an overview of our financial performance, and also provide our guidance for the Fourth quarter of 2020. Following their prepared remarks, we will move into the Q&A session. Before I hand it over to the management, I'd like to remind you of Sunlands' Safe Harbor statements in relation to today's call. Except for the historical information contained herein, certain of the matters discussed in this conference call are forward-looking statements. These statements are based on current trends, estimates and projections, and therefore, you should not place undue reliance on them. Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. For more information about the potential risks and uncertainties, please refer to the Company's filings with the Securities and Exchange Commission. With that, I will now turn the call over to our CEO, Tongbo Liu.

Thank you, Yuhua. Hello, everyone. Welcome to Sunlands' third quarter 2020 conference call. Despite the short-term impact on our operations of the COVID-19 pandemic, in the first half of 2020, Sunlands delivered a steady year-over-year increases in both gross billings and the net revenues, in the third quarter. Our results were fueled by a combination of the recovering macroeconomic conditions in China, as well as the implementation of optimization initiatives within our business. In the third quarter our gross billings reached RMB 654.3 million, increasing by 6.6% year-over-year, and 23.1% quarter-over-quarter. We'll attribute our strongest biddings results largely to improvements we made in sales efficiency, with new approaches to student acquisition as well as our enhancing brand awareness and the continuous upgrades to our product categories. Additionally, following the solid performance in the second quarter of 2020, net revenues increased 2.7% year-over-year to RMB 541.6 million, exceeding the top end of our guidance by 4.2%. Moreover, our new enrollments reached approximately 140,000 in the third quarter, growing 47.8% year-over-year and 70.5% quarter-over-quarter. During the third quarter, we made further progress to balance our top line growth mix. Proving the efficacy of our long-term strategy and efforts to continually to expand our portfolio of educational products and bringing constant innovation. While maintaining a leading market share in STE programs, master's degree-oriented programs and the professional certification and skills programs, continue to reveal great potential to become the next pillars among the Company's offerings. Let me cover the master's degree oriented programs which contributed around 31% to gross billings in the third quarter compared with approximately the 17% in the same quarter last year. The growth of master's degree-oriented programs in terms of gross billings was phenomenal, registering 93.3% year-over-year and 48.4% quarter-over-quarter. This growth was primarily driven by increasing need for…

Thank you, Tongbo. And hello, everyone. Our third quarter financial results reflect our balanced expansion strategy. Net revenues increased by 2.7% year-over-year, exceeding our expectations. This result is attributable to broad-based improvements across our organization, in particular, optimizing our revenue contribution structure. Other highlights in the quarter include a significant increase in gross billings, and a higher proportion of revenues coming from non-STE programs. These accomplishments came from improved efficiency in our student acquisition and conversion methods, recognition of our program diversity, and content enrichment. In terms of cost control management, we pursued a strict spending policy, especially in regard to G&A expenses which were reduced by 16.7% year-over-year. Looking ahead, we will continue to focus on product and service upgrades by deploying our AI-enabled platform systems and a further refinement of our internal operations. We believe this dual-fold effort will bring long-term value to our users, and shareholders, through a sustainable and balanced approach to growth. Now, let me walk you through some of the key financial results for the third quarter 2020. All comparisons are year-over-year, and all numbers are in RMB unless otherwise noted. In the third quarter, net revenue were RMB 541.6 million, an increase of 2.7 year-over-year. Cost of revenue decreased by 18.2% to RMB 92.9 million in the third quarter from RMB 113.7 million in the third quarter 2019. The decrease was primarily due to reduced insurance related costs incurred for our integrated online education service package purchased by students. Gross profit increased by 8.5% to RMB 448.7 million from RMB 413.6 million in the third quarter of 2019. In the third quarter, operating expenses were RMB 664.1 million, representing a 21.4% increase from RMB 546.9 million in the third quarter of 2019. Sales and marketing expenses increased by 32.7% to RMB 569.4 million…

We will now begin the question-and-answer session. [Operator Instructions]. At this time, we are showing no questions, so this will conclude our question-and-answer session. At this time, I'd like to turn the conference back over to Yuhua Ye, IR Representative, for any closing remarks. : :

Once again, thank you, everyone, for joining today's call. We look forward to speaking with you again soon. Good day and good night.

This concludes our earnings conference call. You may now disconnect your line now. Thank you.