Shulou(Shulou.com)11/24 Report--

On March 20, Beijing time, Douyu (NASDAQ:DOYU) released unaudited financial reports for the fourth quarter and the whole year of 2022. Over the past year, Douyu has actively explored commercial realization paths and launched diversified and personalized member payments and interactive content experiences, effectively driving the growth of user traffic and payment conversion on the platform. In the fourth quarter, Douyu created the first sound gift in the live broadcast industry in the previously launched "diamond powder" membership system, and launched three new member privilege gifts, enhancing the emotional companionship and interactive experience between anchors and users. promote a significant increase in the number of members and renewal rates in this quarter.

Thanks to richer boutique game content and differentiated interactive gameplay, Douyu's total revenue in the fourth quarter was 1.681 billion yuan, with a net profit of 41.8 million yuan and an adjusted net loss of 4.3 million yuan, a considerable improvement over the same period last year and month-on-month. Mobile MAU maintained steady growth to 57.4 million, and paying users were the same as in the third quarter, stable at 5.6 million.

Douyu founder and CEO Chen Shaojie pointed out, "in 2022, we are faced with a complex and changeable macro environment, adhere to the development strategy of 'diversified content ecological platform with games as the core', and maintain the basic stability of the company's overall business through a variety of operating strategies, such as optimizing revenue activities, adjusting copyright strategy and increasing investment in homemade content. We will deepen the growth logic of the content platform, take the content construction as the foundation, take the community interaction as the core, enhance the user stickiness and retention. By deeply ploughing game content and precipitating core users, we will explore new growth points while maintaining the leading position of the domestic game live broadcast industry, so as to promote the long-term and healthy development of Douyu. "

Reduce the cost and increase the loss greatly narrow the growth of the member system of "drill powder"

"reducing cost and increasing efficiency" is the main theme that runs through the development of Douyu in 2022. Over the past year, Douyu has taken a number of measures to increase revenue and reduce expenditure, which has led to a rapid improvement in the profitability of the platform and a number of financial data for the better.

In terms of commercial exploration, Douyu, on the basis of previous games such as "drill powder system" and "fan home", in the fourth quarter Douyu continued to optimize the companionship and interactive experience between anchors and users in the membership system, newly launched members' sound effects and privileged gifts, and created diamond powder league matches, diamond powder gift privilege Buff activities, etc., to promote the growth of membership renewal rates for users in the quarter. According to statistics, the daily peak of the number of Douyu drilling powder stations opened in the fourth quarter reached 145000. During the quarter, the average daily opening number increased by 7.6% compared with the previous quarter, and the renewal rate increased by 8.1% over the previous quarter.

In the fourth quarter, Douyu also extended the membership service of a single zone to more game zones, and cooperated deeply with game manufacturers to launch game props user activities such as League of Legends's store, which exchanged points for points through platform interactive play, and then exchanged game props and platform benefits with corresponding points, so as to promote user growth and business transformation of Douyu and game manufacturers in both directions. Take the fourth quarter Douyu online League of Legends shop as an example, during the sale of props Douyu League of Legends mobile games area daily active users increased by 27% compared with the inactive period. It can be seen that the traction effect of commercial cooperation on the growth of ecological users of League of Legends mobile games is very obvious.

In terms of cost control and expense optimization, Douyu also achieved the expected goal of "cutting expenditure" by selectively purchasing copyright, optimizing the operation mode and other multi-dimensional means. According to the financial report, Douyu's income sharing and content costs fell to 1.271 billion yuan in the fourth quarter, down 31.2 percent from the same period last year. Sales and marketing expenses and R & D costs also decreased by 45.9 percent and 39.2 percent, respectively. Driven by measures to reduce costs and increase efficiency, the total revenue of the platform was 1.681 billion yuan, with a net profit of 41.8 million yuan and an adjusted net loss of 4.3 million yuan. Close to break-even by a narrow gap. It is worth noting that for the whole of 2022, Douyu's gross profit margin also rose to 13.9%, with an adjusted net loss of 7.6 million yuan, a substantial decrease compared with last year.

Ploughing game content to create a more interactive content community platform

In the past year, Douyu still aims to strengthen the interaction between platform and users, anchors and users, and has created a lot of diversified and personalized boutique game content, so as to promote the transformation of user traffic and payment.

In terms of self-made events, Douyu launched more than 90 wonderful self-made events in the fourth quarter. Among them, the professional contests and professional team invitational tournaments, which are built with star game anchor IP as the core, have won high user attention under the dual blessing of the influence of anchors and the professional operation of the platform. For example, for LBL with League of Legends's Doinb as the core, the viewing time of the live room during the event increased by 323% compared with the VJ's daily data, and the average number of daily viewing users increased by 140%; Douyu and Arena of Valor's Lucky Cup, with the VJ's Gemini as the core, the number of viewers in the VJ's room increased by about 77% compared with its daily number, and the number of new followers increased by 34.5%.

In addition to professional self-made events for heavy e-sports users, the platform has also launched civilian events such as the Yuyue Cup National Challenge and Douyu school team selection season, covering e-sports fans and college students. Taking the selection season of Douyu e-sports school team as an example, under the background that the organization of offline events in some provinces and cities has been seriously affected, it has still attracted 2756 teams from 11 provinces and more than 200 universities across the country to participate in the competition. it has become the largest campus e-sports competition in China, and has a strong appeal and influence in the university group. At the same time, at the e-sports talent selection track of the "Campus Star Project" opened by Douyu, Douyu recruited 150 students from 300 schools to participate in the Campus Star Project interpretation Talent Group Competition. After fierce practical competition, 15 high-quality campus commentators and talent anchors have been successfully excavated and trained. The more diversified talent selection of e-sports, which takes college competitions as the starting point, not only opens up the career rising channel for campus students to become anchors, but also attracts more non-contestant college students to participate in it. it also promotes the single player selection thinking to move towards a multi-dimensional and three-dimensional e-sports talent training mode, digging out a broader value space for e-sports.

In terms of PGC homemade variety, Douyu continued to make efforts at the level of interactive play in the fourth quarter, launching more than 10 homemade variety shows such as "the Speed of Light Escape-PEL starlight Special Show for the Seventh Anniversary of the King", "running Bar Anchor 7", "the Coronation of the Wild King 3", "Radio Battle Array Conference" and "Wave Concert" and so on, and added a variety of interactive games in the program. For example, in the "Coronation of the Wild King 3" program, a variety of interactive games have been added, such as war pet competition, war pet upgrade, material bidding, and so on, to break the space-time barrier between users and anchors, so that users can also deeply participate in the co-creation of variety content by sending on-screen comments, appreciating consumption, and so on.

In terms of copyright events, Douyu broadcast the Arena of Valor World Champions Cup (KIC) live in the fourth quarter, adding exclusive game-watching features such as "my Home team" and "Anchor call" on the basis of the traditional live broadcast, so that there can be an emotional connection between the event audience and the live broadcast content in the form of cross-screen interaction. According to incomplete statistics, compared with the same period of the Challenger Cup, the number of viewers in the live broadcast room increased by 127%, the peak heat of the live broadcast room increased by 47.8%, and the total number of on-screen comments increased by 70.9%. The new presentation form enhances the sense of participation of users and further expands the influence of the event.

Continue to care for young people and create a sustainable community ecology

While developing his business, Douyu always insists on the same frequency resonance between enterprise development and responsibility. In the fourth quarter, in order to better protect the growth of young people, Douyu, together with the China Children's Foundation, jointly launched the "Sports Power, Future me" public welfare activity for rural children's sports literacy, calling on more people to pay attention to the physical and mental health of left-behind children. At the same time, Douyu, through the previously established UNICEF Douyu Public Welfare Special Fund, donated 200000 yuan worth of sports teaching aids to Guangchang County, Fuzhou City, and helped carry out sports projects such as teaching for left-behind children and football competitions, so as to promote the healthy growth and all-round development of local left-behind children.

At the beginning of January this year, Douyu released the 2022 Corporate Social responsibility report, which comprehensively reviewed the practices and achievements of Douyu in 2022 in terms of content ecological governance, positive energy live broadcast, public welfare projects, technological innovation, and employee care. The "report" points out that Douyu adheres to the belief of "doing practical things well and doing good things well", continues to practice corporate social responsibility, and conveys positive value to the vast number of users with young people as the core. In the past year, Douyu's positive energy content has been broadcast for a total of 62000 hours, with nearly 12,000 live shows, and pan-knowledge content has been broadcast for more than 5.2 million hours, an increase of 25 per cent over 2021. Throughout the year, more than 10 key public welfare projects were launched, covering the areas of caring for the growth of young people, rural revitalization, heritage of non-heritage culture, and protection of biodiversity, and took the initiative to assume corporate social responsibility.

Overall, Douyu maintained a steady and steady development in 2022, the content ecology of the platform continued to improve, the user stickiness was further enhanced, and the community ecological environment was also more healthy. Looking to the future, Douyu will focus on the long-term and healthy development strategy of the platform, strive to optimize the operation mode and explore new ways of realization, so as to bring long-term value to shareholders.

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