Pintec Technology Holdings Limited (NASDAQ:PT) Q2 2020 Earnings Conference Call - Final Transcript

Good morning and good evening everyone. Thank you for standing by and welcome to Pintec Technology Holdings Limited's First Half 2020 Earnings Call. [Operator Instructions] Now, I'll turn the call over to your speaker host today, Ms. Joyce Tang, the Company's Investor Relations Director. Please go ahead.

Hello, everyone, and welcome to Pintec's first half 2020 earnings conference call. The Company's financial and operational results were issued earlier today and are posted online. You can also view the earnings press release by visiting the IR website at ir.pintec.com. A replay of the call will be available on the IR website in a few hours.

Participants on today's call will be Mr. Victor Li, CEO of Pintec; and Mr. Steven Sim, CFO of Pintec. Management will begin with the prepared remarks and the call will conclude with a Q&A session.

Before we continue, please note that today's discussion 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, the Company's results may be materially different from the views expressed today. Further information regarding these and other risks and uncertainties is included in the Company's risk factors and other public filings as filed with the US Securities and Exchange Commission. The Company does not assume any obligation to update any forward-looking statements except as required under applicable laws.

Please also note that Pintec's earnings press release and this conference call include discussions of unaudited financial information as well as unaudited non-GAAP financial measures. Pintec's press release contains a recalculation of the unaudited non-GAAP measures to the unaudited most directly comparable GAAP measures.

I will now turn the call over to our CEO, Mr. Victor Li. Mr. Victor Li, please go ahead.

Thank you very much, Joyce. Hello, everyone. Before diving into our results for the first half of 2020, I would like to just reiterate how excited and honored I am to be taking the helm here at Pintec. As many of you know, Mr. Wei Wei is unfortunately experiencing some prolonged health complications. And he is no longer capable of taking responsibility of the very operations of a publicly traded company. We're all very grateful for Mr. Wei's past contributions, and wish him a speedy recovery.

Now, turning to our results for the first half of 2020. Pintec encountered a series of challenges in 2019 and the first half of 2020, including changes in market conditions, regulation, external partners and management. We also faced outbreak of COVID-19, which significantly impacted our operations in the first half of 2020. In response to these challenges, we decided to shift our business focus by providing an increasing number of digital-centric services, while also gradually reducing our risk-sharing services. As a result of long-term orientation, our top-line performance was adversely impacted in the first half of 2020, with total revenues and cost of revenues decreasing by 65% and 51% year-over-year respectively.

The decision to adopt the new