Xunlei Limited (NASDAQ:XNET) Q2 2019 Earnings Conference Call - Final Transcript

Aug 14, 2019 • 08:00 am ET


Xunlei Limited (NASDAQ:XNET) Q2 2019 Earnings Conference Call - Final Transcript


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Good morning. Thank you for standing by for Xunlei's Second Quarter 2019 Earnings Conference Call. [Operator Instructions]

I'll now turn the call over to your host today, our IR Manager, Ms. Charlene Lu. Please go ahead.

Charlene Lu

Thank you, Annie. Good morning and good evening and thank you all for joining us today. Welcome to Xunlei second quarter of 2019 earnings conference call. I'm Charlene Lu, Investor Relations Manager at Xunlei. With me today are Mr. Lei Chen, our CEO; and Mr. Eric Zhou, our CFO. We will be happy to take your questions after our presentation. Please be limited to two questions at a time, so others can get their questions in as well. Today's conference call is being recorded and a replay of the call will be available on our IR website afterwards. Our earnings press release was distributed earlier today and is now also available on our IR website.

Before we get started, please know that the discussions today will contain certain forward-looking statements made under the Safe Harbor provisions of the US Private Securities Litigation Reform Act of 1995. Such statements are based on management's current expectations under current market conditions and are subject to the risk and uncertainties that are difficult to predict, which can cost actual results to differ materially from those made in the forward-looking statements.

Please refer to our SEC filings for more detailed descriptions of the risk factors that may affect our results. We do not assume any obligations to update any forward-looking statements, except as required under applicable laws. During this call, we will refer to both GAAP and non-GAAP financial measures. Reconciliation of the non-GAAP to comparable GAAP measures can be found in our earnings press release. Please know that all numbers are in US dollars unless otherwise stated.

With that, let me hand over to our CEO, Mr. Lei Chen for prepared remarks.

Lei Chen

Good morning and good evening, everyone. Thank you all for joining us today. Let me start with our recent corporate developments and the financial highlights of the second quarter of 2019. Then Eric will provide more details on the financial results and take you through the guidance for the third quarter of 2019. Our total revenue was approximately $47.8 million this quarter, which exceeded the top end of our earnings guidance as a result of revenue growth from our cloud computing and other internet value added services.

Revenues from cloud computing and other internet value added services combined were $22.5 million, representing an increase of 40.6% from the previous quarter. We are delighted to see organic growth in both demand for our share cloud computing resources and our enterprise client base. Obtaining new clients such as Baidu, NetEase Games and Qutoutiao.

During the second quarter, we made an equity investment in an emerging IT products and services provider and expanded our cloud computing network capacities through aggregating ideal computing resources from business class networking devices for our shared cloud computing business. We believe that the increased demand