Good morning and good evening, ladies and gentlemen. Thank you and welcome to DouYu International Holdings Limited's second quarter 2021 earnings conference call. At this time, all participants are in listen only mode. We will be hosting a question and answer session after management's prepared remarks. I will now turn the call over to the first speaker today, Mr. Mingming Su, Chief Strategy Officer at DouYu. Please go ahead, sir. Thank you. Hello, everyone. Welcome to our second quarter 2021 earnings call. This is Mingming Su, DouYu's Chief Strategy Officer. Joining us today are Mr. Shaojie Chen, Chairman and Chief Executive Officer, and Mr. Hao Cao, Vice President of Finance. You can refer to our second quarter 2021 financial results on our IR website at ir.douyu.com. You can also check a replay of this call when it becomes available in a few hours on our IR website. Before we start, please note that this call may contain forward-looking statements made pursuant to the safe harbor provisions for the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management's current expectations and observations that involve known and unknown risks, uncertainties, and other factors not under the company's control, which may cause actual results, performance, or achievements of the company to be materially different from the results, performance, or expectations implied by these forward-looking statements. All forward-looking statements are expressly qualified in their entirety by the cautionary statement, risk factors, and details of the company's filing with the SEC. The company undertakes no duty to revise or update any forward-looking statements for selected events or circumstances after the date of this conference call. I will now speak on behalf of our Chairman and CEO, Mr. Shaojie Chen. During the second quarter of 2021, our overall performance remained stable as we continued to upgrade our business systems. Total net revenues for the quarter reached RMB 2.34 billion, while quarterly average paying user count reached 7.2 million. During the second quarter, our average mobile MAU increased by 3.9% year-over-year to 60.7 million. MAU growth was mainly driven by two factors. First, we attracted new eSport users and galvanized the return of older users through large-scale eSport tournament broadcasts, which included major events such as our LPL Spring 2021 Finals, LOL Mid-Season Invitational, and KPL Spring 2021. Second, we refined operations by enhancing our collaboration for hit games, including LOL and Honor of Kings, while exploring partnerships with additional game developers to introduce more mid and long-tail games and strengthen operations for new games. For Naraka: Bladepoint, a major hit game launched in the quarter, we collaborated with its game developer to develop and launch various promotional content and events starting in the testing stage. This effort has gradually attracted high-quality players to our platform. Turning to our content updates. During the quarter, we continued to expand our content ecosystem, both upstream and downstream, to cover the entire eSport industry value chain. We also ramped up our efforts to construct a highly comprehensive content library, focusing on various game genres. By broadcasting and self-producing eSport tournaments and events in various formats, we continued to develop more high-quality eSport content. At the same time, we also continued to actively sponsor and invest in a number of top eSport teams. During the quarter, we broadcast over 50 large-scale eSport tournaments and self-produced more than 80 high-quality eSport events. Among them, we leveraged LOL Preseason-Challenger matches to actively cultivate new high-quality streamers, and organize the matches between streamers and young training teams to enrich the content on our platform during the off-season for premier eSport events. In addition, the LPL Summer 2021 tournament, which is the highest level LOL professional tournament in China, kicked off in June. We broadcast the tournament through our platform in concert with other related self-producer programs for complete live streaming coverage of the event from start to finish. For our PEL S1 tournament, the highest level professional league for Peacekeeper Elite, we rolled out a series of promotional events such as live watch parties for tournament matches anchored by popular live streamers to further improve user engagement. Meanwhile, we continued to fuel the development of our content library by introducing additional game developers to make our content library more comprehensive and cover additional game genres. Further, we utilized the eSport tournament broadcasts to further enrich coverage for our blockbuster games. During the quarter, we hosted over 20 tournaments for games of various genres, including LOL, Honor of Kings, and Peacekeeper. Second, we utilized the IP of popular streamers to create more high-quality PGC content and meet the diverse content amount of users. Finally, we further enhanced user engagement based on their interest in high-end strategy and gameplay by delivering content related to real-time strategy and advice from streamers and high-ranking professionals on matching in-game inscription and equipment selection. We also implemented systematic marketing programs for new, mid, and long-tail games. These campaigns are multi-step processes which include the development and delivery of promotional content and events based on individual game life cycles. We began cooperating with game developers prior to the launch of beta testing for new games to foster anticipation and excitement among target consumers. We utilized the influence of our top streamers to increase brand awareness for these new games. Meanwhile, by recruiting new streamers for games in advance, we are able to quickly fill the gap in game content after the game's official launch. Furthermore, we actively cooperated with game developers to launch a series of events to foster development of engaging video content. Through the broadcast of this content, more potential players are attracted to viewing gaming broadcasts. Additionally, our platform generates game-related hot topics, introduces customized programs and content to promote the games, and allows players to have interactions with KOL, enabling us to attract new users and improve user stickiness. Now, turning to monetization. In the second quarter, our quarterly paying users were 7.2 million with an ARPPU of RMB 303. The slight year-over-year decrease in ARPPU was primarily due to abnormally high user activity and ARPPU during the second quarter of 2020 related to stay-at-home orders from the pandemic. During the quarter, user behavior normalized to pre-pandemic levels. Through our operating strategy and execution, we continue to focus on improvement in user engagement and paying user consumption. Going forward, we will work to further optimize our products, diversify our paying user scenarios, and enhance our overall paying user experience to achieve a healthy ARPPU growth rate. Finally, we remain committed to refining our operations across different segments, which should help to further boost the segment efficiency. We are also making good progress on the R&D front. During the quarter, we launched the AV1 decoding technology, becoming the first platform in China to support AV1 decoding in live streaming. Compared with our previous decoding technology, AV1 has lower bandwidth costs and can eliminate lag while maintaining the same video quality. In terms of product function innovation, our platform upgrades revolve around the evolution in our game content. Starting from live streaming, we have expanded into produced video and graphic content. With our popular and new game segment as a primary subject, we have forged an integrated game segment that combines live streaming, videos, video graphic friendly guides, interactive community, and in-game gifts. We have also adapted our platform search function to support these multiple forms of content. By providing support for searching and accessing historical live streams, videos, and video graphic content on our platform, we can now better satisfy users' search queries for specific game content. We also continued to fortify our foothold overseas. During the quarter, we continued to increase our investment in overseas market. In particular, I would like to highlight our achievements in Japan. According to the latest App Annie statistics, Mildom is one of the mainstream video game live streaming app in Japan, and maintains an industry-leading user base in the country. In terms of future strategy, we will continue to strengthen the monetization capabilities of Mildom in order to further solidify its market position in Japan, and also expect to achieve better economies of scale in Japan. In summary, during the second quarter of 2021, we leveraged our platform advantages to achieve success on numerous fronts. We expanded our multidimensional collaborations with more game developers. We also provided the gamers and viewers with comprehensive content offerings, combining live streaming, videos, video graphics and an interactive community. Looking ahead, we plan to continue executing our product streaming and content strategy to further augment our monetization capabilities and improve our overall financial performance. With that, I will now turn the call to our Vice President of Finance, Mr. Hao Cao, to go through the details of our financial performance in the second quarter. Thank you, Mingming. Hello, everyone. Total net revenues in the second quarter of 2021 were RMB 2.34 billion. Live streaming revenues were RMB 2.18 billion, compared with RMB 2.32 billion in the same period of 2020. Advertising and other revenues were RMB 158.7 million compared with RMB 188.3 million in the same period of 2020. The year-over-year decrease in live streaming revenues was mostly due to the abnormally high user activity and up in the prior year period caused by the stay-at-home orders during the pandemic. In the second quarter of this year, as the pandemic was gradually brought under control in China, user behavior had largely normalized, reverting to pre-pandemic levels. This decline was partially offset by our efforts to improve the spending by our core paying users. The year-over-year decline in advertising and other revenues was mainly due to the fact that game advertisers increased their marketing budget in the second quarter of last year due to the pandemic and the related stay-at-home measures. Our overall advertising revenue in the second quarter of last year reached a relatively high level. During the quarter, as the pandemic was continuously brought under control in China and the number of hit games featured on platforms was reduced, our game-related advertising revenue decreased quarterly. Cost of revenues in the second quarter of 2021 increased by 2.3% to RMB 2.03 billion from RMB 1.99 billion in the same period of 2020. More specifically, revenue share fees and content costs increased 3% to RMB 1.81 billion from RMB 1.75 billion in the same period of 2020. This increase was mainly due to increased investment in overseas streamers as we continued to expand overseas market, higher licensing costs due to more investment in eSport tournament broadcasting rights, and additional investment in proprietary content production. Bandwidth costs in the second quarter of 2021 decreased by 3.9% to RMB 161.8 million from RMB 168.4 million in the same period of 2020. This decrease was mainly due to the successful execution of our ongoing in-house technology upgrades, which led to higher bandwidth efficiency and lower bandwidth usage costs during the period. Gross profit in the second quarter of 2021 was RMB 306.5 million compared with RMB 522.9 million in the same period of 2020. Gross margin in the second quarter of 2021 was 13.1% compared with 20.8% in the same period of 2020. This decrease was primarily due to the decrease in revenues, resulting in an increase in revenue share fees and content costs as a percentage of total net revenues. Sales and marketing expenses in the second quarter of 2021 were RMB 295 million compared with RMB 142.1 million in the same period of 2020. This increase was mainly attributable to the increased costs from utilizing additional promotional channels for user acquisition and continuous spending on both official and self-produced live eSport tournaments and corresponding sponsorship fees as the pandemic was gradually brought under control in China. Research and development expenses in the second quarter of 2021 were RMB 123 million, which represented an increase of 29.6% from RMB 94.9 million in the same period of 2020. This increase was primarily due to additional investments in technical personnel as we continued our overseas expansion and technology infrastructure upgrade to enhance user experience. General and administrative expenses in the second quarter of 2021 were RMB 102.6 million compared with RMB 79.5 million in the same period of 2020, primarily due to the increase in professional service fees during the quarter. Adjusted operating loss in the second quarter of 2021, which adds back share-based compensation expenses, was RMB 165.1 million, compared with an adjusted operating income of RMB 272.7 million in the same period of 2020. Net loss in the second quarter of 2021 was RMB 181.7 million, compared with a net income of RMB 319.3 million in the same period of 2020. Adjusted net loss in the second quarter of 2021, which excludes share-based compensation expenses, share of income in equity method investments, and impairment loss of investments, was RMB 145.1 million, compared with an adjusted net income of RMB 322.9 million in the same period of 2020. For the second quarter of 2021, basic and diluted net loss per ADS were RMB 0.45 and RMB 0.45, respectively, while adjusted basic and diluted net loss per ADS were RMB 0.35 and RMB 0.35, respectively. Going forward, we will continue exploring new methods of improving our monetization capability and efficiency. Additionally, as we continue to grow, we will focus on further utilizing our operating leverage to fuel the sustainable development of our platform. This concludes our prepared remarks for today. Operator, we are now ready to take questions. We will now begin the question and answer session. The first question comes from Lei Zhang with Bank of America Merrill Lynch. Please go ahead. [Non-English Content]. Thanks management for taking my question. Two questions here. First is can you give us more color on the new game that have good performance in second quarter? If we look into second half, any new game that we can expect? Secondly, I want to hear your opinion on the traditional eSport game. What is the trend of those games in terms of time span or user that you can share? How do we look at the trend of the hardcore eSport game in the future? Thank you. Thank you. Let me answer these two questions. According to our platform data, new games such as Naraka: Bladepoint and CFHD, CrossFire HD, have performed well since the second quarter of this year. From June to July, we observed that the overall live streaming volume and user engagement for Naraka: Bladepoint increased by more than 200%. We have continued to generate PGC videos and build our content ecosystem for this new game. Such efforts have played an important role in promoting these games and elevating our users platform stickiness. Based on expected the launch schedule for games in the second half of this year, we expect that new catalysts for the gaming market will include LOL Mobile, Pokémon UNITE and Justice Online. Prior to the launch of new games, we plan to cooperate with game developers to foster anticipation and excitement among targeted consumers, and to deliver sufficient and rich game-related content for gamers and users on our platform. Second question, the majority of our top 10 platform games are from traditional eSport game genres, such as MOBA and FPS, which are characterized by long life cycles and high entertainment quality. According to our platform data, our top 10 game genres have remained largely similar in the past several quarters. The data also suggests that users time spent on non-top 10 games over the past two quarters has gradually increased compared to the same period a year ago. We believe the primary reason behind this trend was the strategic upgrade of our platform. In the past, as a pure B2C platform, we used to only offer game-related live streaming content to gamers and users. However, starting from this year, we have focused more on non-eSport games. We have tried to create a separate segment for each new game on our platform. We are also cooperating with game developers to develop more comprehensive plans and quality content for game promotion through live streaming video and graphic text content, as well as our user communities. Such as in terms of live streaming, we can leverage our top streamers to foster anticipation and excitement among targeted consumers prior to the launch of new games. By working with game developers, we can create multiple PGC videos and increase our number of promotional channels. For user communities, we can invite KOLs to have real-time interactions with our users. Thus generating more related hot topics and engaging content. As we continue to execute this product strategy, we expect that the time spent by users on non-eSport game segments will increase, and our platform content will become more diversified in the long run. Thank you. Thank you. Very helpful. The next question comes from Yiwen Zhang with China Renaissance. Please go ahead. [Non-English Content]. Thanks for taking my question. The first question regarding the self-produced tournament. In the prepared remarks you mentioned there were over 80 self-produced tournaments, and we also know that this year there was an upward trend in the pricing of the licensed tournaments. Does that mean DouYu will step up the self-produced content investment in order to tackle the increasing licensing cost trend? Secondly, on the new game preparation, you mentioned a few in the previous question. For example, the League of Legends Mobile. How is our latest progress on the streamer recruitment? An d in what way were we build up the top cohort streamers for the new game preparation? Thank you. [Non-English Content] That will be translated. This year we have witnessed an increase in licensing costs for our eSport tournament broadcasting rights across the industry. However, we expect the licensing costs for the broadcasting right of major eSport tournaments to remain relatively stable over the next couple of years. Our expectation is based on our observation of current market conditions, and the fact that the eSport industry has reached a pretty mature stage of development. In addition, self-produced tournament content has been a pretty important part of our content strategy as well. The self-produced tournament such as the Golden Grand Tournament and the DNF All-Star, they both have produced outstanding results on our platform, and especially the DouYu Golden Grand Tournament, which has been held for around 11 seasons already, and now has become one of the most important brand of DouYu as well. Going forward, we will definitely continue to bolster the organization of our own eSport events, and focus more on the generation of PGC content for non-eSport games. We are pretty confident that we will be able to leverage our enormous amount of quality streamers and video creator resource to execute this strategy. Thank you. Next question, please. The next question comes from Alex Poon with Morgan Stanley. Please go ahead. [Non-English content]. First question is regarding the revenue share and content cost trend in second quarter, including the different components, including the sign-up bonus, revenue share, and content procurement cost, et cetera. How should we forecast this segment costs in future, given we have a little bit of revenue decline? My second question is related to the PC MAU number. This time we have not disclosed the PC MAU number. What is the reason behind this? If we remove the duplicated users, how many PC users do we actually have? Thank you very much. About the first question on revenue sharing cost, we will maintain our 50/50 revenue split sharing policy for our platform and streamers, that for our platform and talent agencies. During promotional periods, we also offer certain incentives to streamers and talent agencies. While the overall revenue sharing ratio may fluctuate slightly quarter-over-quarter, it will also remain stable in general. The increase in content costs in the second quarter of 2021 was primarily associated with higher licensing costs and increased investment in self-produced programs. The increase in licensing costs was due to more investment in eSport tournament broadcasting rights across the industry, starting from this year. As tournament density becomes higher, we expect licensing costs in the second half of this year to increase slightly from the first half of this year. For our self-produced programs, as we invest more in programs to produce PGC content to support the upgrade of the content and functions of our new businesses, we expect the associated costs to continue increasing at a moderate pace throughout second half of this year. Let me answer your second question. First, our PC MAU have remained relatively stable within the range of 110 million-130 million. Since our IPO in July of 2019, the quarterly fluctuations were mainly driven by such factors as our periodic collaborations with PC game developers. In addition, the revenue contribution from live streaming on our PC portal has stabilized over the past several quarters. In the long run, we expected our mobile portal to be the primary driver for attracting users and generating revenue. As a result, we have decided to stop disclosing our PC MAUs starting from this quarter. With user growth for non-eSport blockbuster games still relatively under-penetrated, we believe there is plenty of opportunities in the mobile market. In the future, we will deepen our collaborations with non-eSport game developers to better cultivate user spending habits and create a more welcoming contender ecosystem for our users. Thank you. The next question comes from Daniel Chen with JP Morgan. Please go ahead. [Non-English content]. I will translate myself. My first question is on the revenue side. We actually see that the second quarter revenue has declined on a year-over-year basis. Could management provide some more color on the rationale behind, and what's the paying user and the ARPPU trend for the second half of this year for live streaming? Secondly, is on cash. Currently, I see as of second quarter of this year, we still have over $1 billion of net cash. How are we going to use this cash in the future? Thank you. The year-over-year decrease in revenues was mostly due to the abnormally higher user activities and ARPPU in the prior year period, caused by the stay-at-home orders during the pandemic. In the second half of this year, to further stimulate our paying users' purchase willingness and enrich their consumption scenarios, we will continue to focus on monetization activities and products. Through our continuous focus on improving the engagement and consumption of our existing paying users, we hope to further elevate our ARPPU. The cash on hand. We are focused on effectively using a strong balance of cash going forward. We will prioritize the efficient allocation of cash to operational initiatives that drive the steady development of our game-related business. These initiatives include exploring strategic content upgrades more actively, developing new business segments, and continuing to invest in new growth drivers. For example, at the end of last year, we rolled out a strategic plan to further enrich the content on our platform. We also increased investments in non-eSport game segments to attract new users. Finally, we escalated our R&D spending to further explore new monetization models, which was in line with our aim to make games a major monetization channel for our game-centric platform. On the other hand, we will take more initiative in the exploration of suitable investment and acquisition opportunities in our game-related segment, as well as downstream and upstream the eSport value chain. Through these investments and acquisitions, we will expand the depth of our exposure to a wider range of industry segments and generate more synergies within our existing businesses. Thank you. Thanks. The next question comes from Thomas Chong with Jefferies. Please go ahead. [Non-English content]. Thanks management [Non-English content]. Thanks management for taking my questions. I have a question relating to the halt of the M&A with Huya. What should we expect the cancellation of the deal to our operations? Can management comment about our business strategy as an independent platform? The second question is relating to the competitive landscape. How should we think about the competition? Is it going to be more intense after the merger is canceled? Thank you. [Non-English content]. Okay, thank you for your question. Since the rapid development of the domestic Internet industry over the past few years, the authority has gradually improved the industry policy and regulation as well. We believe that the antitrust regulations are in line with the government's goals of promoting positive and fair competition among Internet industry participants. And thus to encourage a level playing field across industries. Therefore, DouYu fully respect this regulatory decision, actively cooperate with the regulatory requirements, and operates in compliance with the law. DouYu has been an independently operated and managed company since its inception. As a result, so we don't expect the decision to prohibit our proposed merge with Huya by SAMR, which stand for the State Administration for Market Regulation of the People's Republic of China, to have a material impact on our operational and financial performance. As an independently operated and managed company, we will make continuous effort to maintain our steady growth momentum and also expand our content ecosystem, both on upstream and downstream, to cover each link of eSport industry value chain. In addition to bolstering our industry leadership in the traditional eSport live streaming industry, we will continue to fortify our operations in non-eSport segments to accelerate our growth and cultivate a game-centric content ecosystem on our platform. The second question. The game live streaming industry competitive landscape have not changed significantly since the second quarter of 2021. Since the streamers were barred from moving between the platforms, competition in the industry has remained pretty healthy. On top of this, our premium top and mid-tier, also the long-tail streamer resource, have helped us to create a strong competitive advantage in term of both content and number of premium streamers, so therefore enabling us to continuously maintain our industry leadership. We have increased our focus on leveraging our unique competitive advantage to create more game-centric content, and also build eSport content community to attract new users. In addition to our continued efforts in actively cooperating with traditional eSport game developers, we have left no stone unturned in expanding our collaboration with other games developers. In our non-eSport segment, we have not only covered the entire industry value chain, but also reinforced our leading position as a game-centric and community-based platform in China. This achievement is primarily attributable to our execution of operation initiatives based on the unique feature of non-eSport games, such as user preferences for graphic tasks and video content. Our initiative included encouraging live streaming video and community function integration, so strengthening our operations for the full lifecycle games, enhancing platform interactions between user and content creator, and also creating a high-quality proprietary content. Thank you for your question. Thank you. The next question comes from Ritchie Sun with HSBC. Please go ahead. [Non-English content]. I will translate it myself. Thank you for taking my questions. The first one is, the sales and marketing expense was growing very rapidly in second quarter. Why is that? What are the major traffic acquisition channels for us, and how would the traffic acquisition costs trend in the future? Second question is, can you share our expansion progress in the Japanese market in more detail, and when will the monetization kick in? Thank you. Sales and marketing expenses include staff salaries, the channel promotion costs, eSport team sponsorship fees, and expenses for online and offline activities. In the second quarter of 2021, the increase in sales and marketing expenses was primarily due to our promotional activities for new product functions and increased marketing budget to attract new users, which was in line with the development of our new business. Our primary promotional channels for user acquisition are through those advertising agencies associated with Tencent and iQIYI. We also leverage other news feed platforms and content libraries as additional user acquisition channels. We are quite positive about development of the eSport industry in the long run, and we will continue to increase our investments in eSport-related activities and eSport team sponsorships going forward. Meanwhile, we will upgrade our product features to improve efficiency of our traffic conversion. We intend to continue enhancing our channel promotions. Therefore, in the future, we expect our sales and marketing expenses to remain at a relatively high level. Let me answer your second question. During the second quarter of 2021, we continued to invest and explore in the Japanese market. For our Japanese live streaming platform, Mildom, we were able to maintain its market-leading position in product functionality and content general diversity. Driven by its high-quality content offerings, Mildom continued to quickly attract new users. According to the latest App Annie statistics, Mildom is one of the mainstream video game live streaming apps in Japan and maintains an industry-leading user base in the country. In terms of future strategy, we will continue to strengthen our monetization capabilities of Mildom in order to further solidify its leading position in Japan, and also expect to achieve better economies of scale in Japan. No more questions. Okay. Thank you again for joining us today. If you have any further questions, please feel free to contact us or request through our IR website. Thank you. Have a good day. The conference is now concluded. Thank you for attending today's presentation. You may now.