Author: Zhang Rui Produced | Deep Web・QQ MusicNews Xiaoman Studio May 24,quick workerScience and Technology announces its financial report for the first quarter of 2021 (three months ended March 31, 2021). The financial report shows that Kuaishou’s revenue in the first quarter was 17.019 billion yuan, a year-on-year increase of 36.6%; a net loss of 57.75 billion yuan, an increase of 89.4% year-on-year, and an adjusted net loss of 4.918 billion yuan, an increase of 13.2% year-on-year. For adjusted net losses, Kuaishou financial reports are defined as losses during the period plus share-based compensation expenses and changes in the fair value of convertible redeemable preferred stocks. Adjusted net loss of 4.918 billion yuan increased employee compensation expenses The financial report shows that the cost of sales of Kuaishou increased by 22.3% from RMB 8.2 billion in the same period in 2020 to RMB 10 billion in the first quarter of 2021. Regarding the increase in cost of sales, Kuaishou provided the following explanation in the financial report: The expansion of the user base and business growth have led to an increase in user traffic, as well as increased bandwidth fees and server hosting costs, depreciation of property and equipment and right-of-use assets, and amortization of intangible assets. On the other hand, increasing the number of employees and increasing share-based compensation expenses in order to support business growth has led to an increase in employee compensation expenses. In terms of gross profit, Kuaishou’s gross profit increased by 64.1% from RMB 4.3 billion in the same period in 2020 to RMB 7 billion in the first quarter of 2021. Gross profit margin increased from 34.2% in the same period in 2020 to 41.1% in the first quarter of 2021. Kuaishou’s explanation in the financial report was mainly due to the expansion of other businesses such as online marketing services and e-commerce business, which led to a decrease in our live broadcast revenue as a percentage of total revenue, which in turn led to a decrease in sales cost as a percentage of total revenue. Sales and marketing expenses increased by 44.0% from RMB 8.1 billion in the same period in 2020 to RMB 11.7 billion in the first quarter of 2021. Its percentage of total revenue increased from 65.0% to 68.5%, mainly due to promotion and Due to increased advertising expenses. Promotion and advertising expenditures increase in the first quarter of 2021. The explanation given by Kuaishou in the financial report was mainly due to the increase in marketing expenses and brand promotion activities for our promotion of Kuaishou Express Edition and other applications. In terms of administrative expenses, it increased by 128.2% from RMB 308.2 million in the same period in 2020 to RMB 703.4 million in the first quarter of 2021, and its percentage of total revenue increased from 2.5% to 4.1%. The explanation given by Kuaishou in the financial report was mainly due to the increase in the number of administrative staff and the increase in share-based compensation expenses to support business development, which led to an increase in employee welfare expenses. Excluding the impact of share-based compensation expenses, the percentages of administrative expenses to revenue in the first quarter of 2021 and 2020 are 2.7% and 1.8%, respectively. In terms of R&D expenditure, it increased by 199.2% from RMB 939.5 million in the same period in 2020 to RMB 2.8 billion in the first quarter of 2021, and its percentage of total revenue increased from 7.5% to 16.5%. Kuaishou’s explanation in the financial report was mainly due to the continued investment in artificial intelligence, big data and other advanced technologies, which significantly increased the number of R&D personnel and increased share-based compensation expenses, resulting in increased employee welfare expenses. Excluding the impact of share-based compensation expenses, the percentages of R&D expenses to revenue in the first quarter of 2021 and 2020 are 10.8% and 6.4%, respectively. Live broadcast revenue declines, online marketing services revenue has increased significantly From the perspective of revenue composition, revenue from online marketing services and other services increased year-on-year, while revenue from live broadcast business declined year-on-year. Revenue from online marketing services increased by 161.5% from RMB 3.3 billion in the same period in 2020 to RMB 8.6 billion in the first quarter of 2021. Kuaishou’s financial report explained that it was mainly due to the expansion of the user base to attract more online marketing customers, and the strength of artificial intelligence and big data to enhance the effectiveness of online marketing services. The revenue of live broadcast business decreased by 19.5% from RMB 9 billion in the same period in 2020 to RMB 7.3 billion in the first quarter of 2021. The explanation of the Kuaishou financial report is mainly due to the fact that the average monthly paying users of live broadcast have changed from 67.0 million in the same period in 2020 to 52.4 million in the first quarter of 2021. There were more monthly paying users in the first quarter of 2020, partly due to strict quarantine during the COVID-19 outbreak, and more users turned to online social and entertainment activities. In the first quarter of 2021, the general public returned to their normal lifestyles. The time spent on activities is reduced. Revenue from other services increased by 589.1% from RMB 175.8 million in the same period in 2020 to RMB 1.2 billion in the first quarter of 2021, mainly due to the expansion of e-commerce business. Over 150 million MAU in overseas markets In terms of user volume, both the scale and activity of Q1 users in 2021 will increase significantly. In 2021, the average daily active users of Chinese apps and mini programs of Kuaishou in Q1 of 2021 reached 379.2 million, a year-on-year increase of 26.4%. The average daily usage time of each daily active user of the Kuaishou app increased to 99.3 minutes, an increase of 10.5% from the 89.9 minutes announced in the fourth quarter of last year. Kuaishou also disclosed the latest developments in the international market for the first time: with South America and Southeast Asia as its core targets, it has achieved breakthroughs in different overseas products such as Kwai and SnackVideo. Data shows that the average monthly active users in overseas markets in the first quarter of Kuaishou exceeded 100 million. In April this year, MAU (monthly active users) in overseas markets further increased to more than 150 million. Kuaishou’s overseas business began to deploy around 2017. Since 2020, Kuaishou has further adjusted its strategy, increased investment and layout in overseas markets, and demonstrated a clear determination to internationalize. At the end of 2020, the former Didi international business COO Qiu Guangyu joined Kuaishou and became the new Kuaishou international business head; in April this year, Kuaishou ushered in a new head of overseas technology, former Facebook Chinese engineering executive Wang Meihong. Kuaishou’s investment in overseas markets shows Kuaishou’s determination to enter the international market. According to statistics, the number of active users of the overseas version of Bytedance TikTok has reached more than 800 million globally. 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