Welcome ladies and gentlemen, and thank you for your patience. You’ve joined Xunlei’s Fourth Quarter and Fiscal Year 2021 Earnings Conference Call. At this time, all participants are in the listen-only mode. Please be advised that today’s conference is being recorded. I would now like to turn the call over to your host, Investor Relations Manager, Ms. [indiscernible]

Thank you. Thank you, everyone and good day, everyone. And thank you for joining Xunlei’s fourth quarter and fiscal year 2021 earning conference call. As of now, our earnings release is available on our IR website, which is intended to supplement our prepared remarks during today’s call. On the call with me today are, Eric Zhou, Chief Financial Officer; and [indiscernible] Senior Vice President of Finance. Our today’s agenda, I will first read a prepared remark by our Chairman and CEO, Mr. Jinbo Li on the highlight of our fourth quarter operations and strategies for 2022. Then, Mr. Eric Zhou, our CFO will walk you through the details on the financial results and wrap up with our guidance for the first quarter of 2022. I would like to welcome any questions from you after the management’s remarks. Before we get started, I would like to take this opportunity to remind you that the discussion today will contain certain forward-looking statements made under the Safe Harbor provision of the U.S. Private Security Litigation Reform Act of 1995. Such statements are based on management’s current expectations under current market conditions and are subject to risks and uncertainties that are difficult to predict, which may cause actual results to differ materially from those made in the forward-looking statement. Please refer to our SEC filings for more detailed description of the risk factors that may affect our results. Xunlei assumes no obligation to update any forward-looking statements except as required under applicable rules. On this call, we will be using both GAAP and non-GAAP financial measures. A reconciliation of non-GAAP to comparable GAAP measures can be found in our earnings press release. Please note that all numbers are in U.S. dollars unless otherwise stated. Now, the following is the prepared statement by Mr. Jinbo Li, Chairman and CEO of Xunlei Limited.

Thank you for joining us today. In 2021, we make some important progress in our major business segment. Our total revenue grew 28.3% to $239.6 million and achieved a net profit of approximately $1.1 million, a dramatic improvement over a net loss of $14.1 million in 2020. Even though, we coped with challenges due to the COVID-19 and the evolving government of regulations that affected our operating environment, we were able to contact our business effectively and remarkably improved our performance as compared with last year. I’d like to take this opportunity to thank our employees for their diligence and dedication to serve our customers during a trying period of time. Because of their agility, resilience and dedication, we are able to start fiscal year 2022 with a solid foundation. In particular, I’d like to express my gratitude to the team responsible for our membership subscription business, which generated significant cash flows to fund our innovation effort. I’m also appreciative and proud of the outstanding performance our cloud computing colleagues achieved during 2021. And lastly, I’d like to thank our employees in the corporate development and innovation department for their outstanding effort that created new growth opportunities that are to expected to produce potentially exciting results in a day to come. Back to our fourth quarter of 2021, the total revenues for the fourth quarter reached $71.1 million, an increase of 18.6% from previous quarter, exceeding the revenue guidance we provided in a third quarter. The performance was driven primarily by the sequential growth of our cloud computing products and other internet value added services. Now I’d like to provide some details on operating results. Starting with our largest revenue growth driver. Cloud computing and other internet value-added services contributed $44.7 million in revenue, which accounted for approximately 62.9% of…

Thank you, Jinbo, and hello, everyone, and thank you again for joining Xunlei’s fourth quarter and year 2021 earnings conference call. I will now go through the details of our financial results and wrap up with our revenue guidance for the first quarter of 2022. For the fourth quarter of 2021 total revenues were $71.1 million, representing an increase of 18.6% from the previous quarter. The increase in total revenues was mainly attributable to increased revenue from cloud computing and other IVAS business. Revenues from cloud computing and other IVAS were $44.7 million, representing an increase of 26.9% from the previous quarter. The cloud computing revenues was $28.2 million, representing a 12.8% sequential increase. The live streaming revenue was $14.5 million compared with $8.35 million in the previous quarter. The increase of cloud computing and other IVAS revenues was mainly driven by increased demand for cloud computing and new live streaming products we launched in the second half of 2021. Revenues from subscription were $23.7 million, an increase of 4.3% from the previous quarter. The number of subscribers was 4.39 million as of December 31, 2021, compared with 4.15 million as of September 30, 2021. The average revenue per subscriber for the fourth quarter of 2021 was RMB34.3, compared with RMB35.4 for the previous quarter. Revenues from online advertising were $2.8 million, representing an increase of 33.1% from the previous quarter. The increase of online advertising revenues was largely due to business recovery and our marketing efforts during the fourth quarter. Cost of revenues was $37.6 million, representing 52.8% of our total revenues, compared with $30.4 million or 50.7% of the total revenues in the previous quarter. The increased cost of revenues was mainly attributable to increased sales of our cloud computing and other IVAS services. Bandwidth costs as included…

[Operator Instructions] First question comes from George Pang with Private Investor.

[Foreign language]

Basically, his question is the management of the company, please share with us Xunlei's future growth strategies and priorities of business development. Let me try to explain to you. In the short term, through our position efforts, we have made some progress, narrowing our net loss to $0.5 million in the fourth quarter of last year and achieving a net profit of $1.1 million for the full year of 2021. Furthermore, most of our business were improving and we are seeing continued momentum, and we will strive for greater improvement by increasing operating efficiency, optimizing expenses and exploring and focusing on areas of significant growth potential. And in the long term, we will maintain Xunlei's competitive edge, while seeking more long-term and sustainable growth opportunities as well as exploring more exciting products and services. Our strategic acquisitions and expansion of our live streaming business last year have shown initial and encouraging signs of progress, which contributed to a significant portion of total revenues in 2021. And we expect that momentum of growth will continue. Thank you for your question.

[Foreign language]

And his question is, we saw a net loss in the fourth quarter declined significantly as compared with the third quarter and what – and what is your profit forecast for the coming quarters? Thanks for the question. The significant reduction in net loss in the fourth quarter is a result of rapid business growth and expense optimization, but we usually do not provide guidance on net income or losses for the coming quarters. That being said, we are hopeful that we will improve both top line and bottom line in the coming quarters. By the way, in the fourth quarter earnings release, we provided a guidance of our anticipated total revenue for the first quarter of 2022, which is in the range of between 77 million and 80 million, which represents a sequential quarter-over-quarter increase of about 10%. Thanks for your question.

[Foreign Language]

Our next question is from Sidney Fong with private investor. Your line is open.

[Foreign Language]

His question is truly invested in a country code in innovation technology company and the company is applying for IPO, and he wants to know the status of the IPO, and also he wants to know the investment we made and what would be the expected rate of return on investments? And we invested approximately RMB60 million in innovation technology company limited in around 2016. The company is also known Insta360. Xunlei has about 8.73% equity ownership in the company. Insta360 submitted application for IPO at the [indiscernible] or Science Technology Innovation Board at Shanghai Stock Exchange last year, and the Stock Exchange has approved the application and now [Foreign Language] China Securities Regulatory Commission is reviewing the case. That's all we know today. And it's really hard to predict the rate of return on investment at this time. If the IPO is approved, and the company's performance remains strong and the stock market will be in a bull market in the next couple of years, our return on investment would be substantial. Thank you.

[Foreign Language]

Thank you. [Operator Instructions] And our next question comes from Bill Anten with private investor. Your line is open.

Hi, hello.

Hi, hello, yes.

Sorry. Hi. That was a great presentation. Thank you. And I have some questions about the Xunlei headquarters building. So first of all, what's the total investment of this building so far? And when do you expect to move in? And another question would be that will Xunlei built out some office space for rental income? And that's it for my question and thank you.

In Xunlei Tower, we have spent approximately RMB300 million and the total budget for the building is approximately RMB450 million, all about U.S. $70 million. The construction area of building pass about 65,000 square meters and the building has 26 stories. We have completed the construction of the Xunlei headquarter buildings, and we anticipate to move in around June this year. If the impact of the COVID-19 won't last long, people probably know and right now, we are facing some challenges again due to COVID-19. And we expect the completion of the headquarters building will not only reduce our operating costs, but also generate some rental income. Because the building has not started operations, the rental income information is not available now. I'd like to see the building is mainly for self use. Thank you for your question.

[Foreign Language]

Thank you. And I'm showing no further questions. I'd like to turn the call back to Eric Zhou for closing remarks.

Well, thank you, again, for your time and participation. And if you have any questions, please visit our website at irxunlei.com or send us e-mail to our Investor Relations. Have a good day. Operator, we conclude today's conference call. Thank you.

Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.