Xunlei Ltd. Q1 FY2025 earnings call

Management Statement and Operational Highlights:

• Chairman and CEO Jinbo Li reported Q1 2025 revenue of $88.8 million, a year-over-year top line growth of 10.5%.
• Subscription revenue increased by 7.7% year-over-year to $35.7 million, with subscribers growing by 5% to 6.04 million, attributed to diversified marketing channels for user acquisition.
• Live streaming and other services revenue grew 66% year-over-year, with overseas audio live streaming revenue up 79.2%, reflecting success in overseas market adaptation.
• Cloud computing business faced challenges with a 18% year-over-year revenue decline due to intensified competition and pricing pressures.
• Focus on diversifying marketing channels, creating innovative features, enhancing service efficiency, and user experience improvement.
• Announced acquisition of Hupu in January and active development of AI-driven applications leveraging large language models.

Segment Performance:

• Subscription business: Revenue increased by 7.7% year-over-year to $35.7 million, with the total number of subscribers growing by 5% year-over-year to 6.04 million. Revenue contribution from subscription: calculated as ($35.7 million / $88.8 million) * 100% ≈ 40.2%.
• Live streaming and other services: Revenue saw a significant 66% year-over-year growth to $28.4 million. Overseas audio live streaming revenue increased by 79.2% year-over-year. Revenue contribution from live streaming and other services: ($28.4 million / $88.8 million) * 100% ≈ 31.9%.
• Cloud computing business: Revenue declined by 18% year-over-year to $24.7 million. Revenue contribution from cloud computing: ($24.7 million / $88.8 million) * 100% ≈ 27.8%.

Guidance:

• For Q2 2025, Xunlei estimates total revenues to be between $91 million and $96 million, with the midpoint representing a quarter-over-quarter increase of approximately 5.3%.

Risks:

• Cloud computing business facing significant challenges due to intensified competition and pricing pressures within the rapidly evolving industry environment.
• Forward-looking statements subject to risks and uncertainties based on current market conditions, which may cause actual results to differ materially from forward-looking statements.

Question and Answer: Q: Could you provide an update on the status of Xunlei's AI product exploration?

A: Our team is engaging in developing and testing AI-driven applications, including an AI-powered auto editing tool, an effective AI companion, and an AI integrated solution. These products are currently under development and testing, and we will launch them when ready with further updates.