TuanChe Limited (NASDAQ:TC) Q2 2020 Earnings Conference Call - Final Transcript

Good morning, and good evening, ladies and gentlemen. Thank you for standing by, and welcome to TuanChe Limited Second Quarter 2020 Earnings Conference Call.

[Operator Instructions] After prepared remarks by the management team, there will be a question-and-answer session. Today's conference call is being recorded.

I would now like to turn the call over to your host today, Ms. Cynthia Tan, IR Director of the Company. Please go ahead, ma'am.

Hello, everyone, and welcome to TuanChe's second quarter 2020 earning conference call. We have released our earning results earlier today and it is now available on our IR website, as well as on Newswire services.

Before we continue, please note that the discussion today will contain forward-looking statements made under the Safe Harbor provision of the US Private Securities Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, our future result may be materially different from the views expressed today. Further information regarding this and other risks and uncertainties is included in our earning release and our registration statement filed with the SEC. TuanChe does not assume any obligation to update any forward-looking statements, except as required by law.

Today, you'll hear from Mr. Wei Wen, the Company's Chief Executive Officer, who will provide an overview of our growth strategy and business developments. He will be followed by Mr. Chenxi Yu, Ronnie, the Company's Deputy Chief Financial Officer, who will provide additional details on the Company's financial results and discuss the financial outlook. Following management's prepared remarks, we'll open up the call to questions.

With that said, I would now like to turn the call over to our CEO, Mr. Wei Wen. Please go ahead, sir.

Hello, and thank you, everyone, for joining us today on our second quarter 2020 earnings call. In the second quarter, we are pleased to report a 63.3% year-over-year reduction of net losses attributable to the Company's shareholders, primarily driven by the acceleration of our rigorous cost measures and online strategy, despite a year-over-year decrease of 73.1% in net revenues and a year-over-year decrease of 70.1% in gross profit due to material COVID-19 related impact.

Net loss attributable to the Company's shareholders in the second quarter of 2020 was RMB40 million compared with RMB108.9 million in the second quarter of 2019. Let's take a thorough look at the second quarter performance of our business segments while also providing additional detail on our strategic and operational priorities.

First, our offline marketing services. As we have discussed in our first quarter earnings call and in the press releases prior to today, out of concern for public health and in accordance with all national and local regulatory guidelines on COVID-19 prevention and control, we held a very few offline events in April 2020. These events gradually resumed in late May. Given that the suspension of events lasted for the significant part of the second quarter, our operating and financial performance for offline marketing services continued to be materially affected by the pandemic.

We organized