HUYA Inc. (NYSE:HUYA) Q1 2019 Earnings Conference Call - Final Transcript

May 17, 2019 • 02:00 am ET

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HUYA Inc. (NYSE:HUYA) Q1 2019 Earnings Conference Call - Final Transcript

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Executive
Rongjie Dong

been successful categories, thanks to Huya's talent agency partners. The percentage of MAUs viewing live streaming of outdoor content and anime content increased to 14% and 10% in quarter four 2018 from 10% and 7%, respectively, in the year ago period. As talent agencies are taking a significant role in developing outdoor and anime PUGC, our quality of content has been greatly improved at minimal overhead costs to us. At the same time, we produced a series of original PGC shows on our path to content diversification. For instance, by collaborating with PUBG Mobile, we launched the Team up with My Idol in January, a crossover live show inviting idol celebrities to stream with popular game broadcasters.

International expansion continues to be our key competitive differentiated -- differentiator as we remain optimistic and selective in emerging markets across Southeast Asia and Latin America, where we have established first-mover advantage. Establishing a baseline foundation through NIMO TV, our wholly-owned business unit targeting the overseas market, we will launch further marketing and promotion efforts to grow user base. To illustrate, we are hosting local tournaments on regional popular games, such as Free Fire in Brazil to attract streamers and users alike. Leveraging off our expertise in the game live streaming space and localization strategy, we are confident in our globalization process and long-term returns on our overseas investment. Facing the uncertainties that lied ahead under such macroeconomic conditions, our overseas strategy will diversify the sources of both user base and revenue streams, thus bolster our confidence to generate steady long-term growth.

On the technology initiatives front, with the advantages in content and operation, we will remain focused on investing in technology to develop revolutionary products and best-in-class user experience. As an example, we have now deployed AI-facilitated technology called Smart Editing, which generates clips of highlights right after a game ends and automatically distributes to various channels so that users can have immediate access to the gaming highlights.

Another recent tech update is that we signed a MoU with China Telecom in April for 5G solution cooperation and successfully completed live streaming outdoor activity in 4K high-definition through the 5G network for the first time among China -- Chinese live streaming peers. Looking ahead, we see great potential for higher definition and latency-free solutions as 5G technology is put into commercial deployment, bringing fluent gameplay and content consumption experiences.

With all that being said, as we drive our leadership position further with these initiatives in technology, overseas market and content diversification, I believe Huya will establish significant presence in some of these new territories within next two to three years. While the game live streaming industry has been consolidating since Huya went public last year, we are also seeing an increasing amount of capital inflow into this arena, and the competition remains among top companies. To lay the foundation of these new initiatives and provide funding for long-term sustainable growth, we successfully completed a follow-on offering recently.

In summary, we are excited