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58.com Inc (WUBA)
Q3Â 2019 Earnings Call
Nov 19, 2019, 8:00 a.m. ET
Contents:
- Prepared Remarks
- Questions and Answers
- Call Participants
Prepared Remarks:
Operator
Good day, and welcome to the 58.com Third Quarter 2019 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded.
I would now like to turn the conference over to Christian Arnell. Please go ahead.
Christian Arnell -- Investor Relations
Thank you. Hello, everyone, and thank you for joining us this evening. Our earning release was distributed earlier today, and is available on the IR website at ir.58.com, as well as through PR's Newswire services.
On the call today from 58 are Mr. Michael Yao, Chairman and Chief Executive Officer; and Mr. Wei Ye, Chief Financial Officer. Michael will review business operations and Company highlights, followed by Wei, who will discuss financials and guidance. They will both be available to answer your questions during the Q&A session that follows.
Before we begin, I would like to remind you that this call may contain forward-looking statements made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements are based on management's current expectations and current market regulatory and operating conditions and relate to events that involve known or unknown risks, uncertainties, and other factors, all of which are difficult to predict, and many of which are beyond the Company's control, which may cause the Company's actual results, performance or achievements to differ materially from those in the forward-looking statements.
Further information regarding these and other risks, uncertainties and factors is included in the Company's filings with the US Securities and Exchange Commission. The Company does not undertake any obligation to update any forward-looking statement, as a result of new information, future events or otherwise, except as required under law.
It is now my pleasure to introduce Michael. Please go ahead.
Jinbo Yao -- Chairman and Chief Executive Officer
Thanks, Christian, and thanks for joining our call. The macro economy remains uncertain, and as such uncertainty. Price created a challenging business environment. Despite a headwind, we are very please to report solid financial and the operational results for the third quarter. Revenue totaled RMB4.26 billion, an all-time high and exceeded the high-end of our previous guidance. Among our core revenue segments, revenue for our online marketing service grew solidly, increasing 20% when compared with the same quarter last year.
E-commerce service and other services revenue combined generated outstanding growth moment and increased 129% year-over-year. On a non-GAAP basis, our operating income grew by 21.3% year-over-year. Once again still showing the strength of our operational -- operation leverage. The key component of our business model that enable us to steadily anchor our strategic investment in new business, such as Zhuan Zhuan [Indecipherable] platform.
Our unique paying business users was 3.6 million this quarter, a 3% increase from the same quarter of 2018. Our traffic remains very healthy, with mobile app users grow faster than revenue on a year-over-year basis, which reflects how we are able to provide a better return on investment for our customers.
Our total headcount was about 22,000 during the quarter, 2% lower than a year ago. We continue to accelerate the pace of our structural shift toward supporting innovation and then improve internal efficiency, resulting in a 10% increase in product and the technology staff, and a decrease of 4% in sales and marketing personnel related for the same period the last year.
We have always strongly believed in our business model. Horizontal costs by the marketplace combined with a pure vertical platforms, either acquired or internally incubated. The horizontal marketplace offers diversified content categories, products and services, which are more resilient during the challenging economic period due to the scale, network effect and the risk profile is opposite for the business model for vertically integrated players.
Vertical marketplace offer a more in-depth industry-specific purchase in the service. At the beginning of this year, in anticipation of an uncertain macroeconomic environment, the effect is worse. Encouraged that we capitalize on any opportunity for solid top line or a leading market position in all our core categories, despite stronger headwind that -- than originally expected.
We are very pleased with the execution of our initial -- initiatives and the great progress we have made in enhancing our ecosystem. We also scaled back advertising expense in the second half and our operating and the net margin remains healthy.
Within our housing category, transaction volume remains low. There is currently low [Indecipherable] the government policy revolution and the overall sentiment in the property market continue to be weak. This is expected to be the norm for the foreseeable future. That said, our secondary and the rental housing business showed tremendous resilience and they still lead the market by a wide margin.
At the same time, our primary housing business strengthened its leading position by accelerating its market penetration and expanding its market share. We continue to have tightness on our technology advantaged by further enhancing the user experience in the improving the effectiveness of our marketing. For example, our automated VR stitching technology allow significantly improves the process time and the quality of VR production. In doing so, it has become an integral part of our agent customers to keep.
We also launched our one-click innovation program at the end of September, applying a similar technology to allow users to simulate their own innovation design, online and they try to either go there for it property distance. This marks only the start of our pending footprint in the renovation category, one of the most important adjacent housing category.
Within our job category, employers continue to be very cautious when it come to hire with more and more talk and -- wait and see approach. In response, we have increasingly offered more flexible products to allow our customer to tailor their needs. Unique paying business users in the job category continue to grow both year-over-year and sequentially. We solidified our leading market position, while constantly innovation in both products and solutions that best serve our customer in the same way that we build our own property database. We are also operating our enterprise and applicant database with an effort on user big data to better profile our current users. And deploying AI for more process and effective margin.
In August, we launched super job season, a co-branding campaign in partnership with McDonald's, JD.com and [Indecipherable] and Zhaopin that touch the job categories such as waiters, customer service, Zhaopin, assistance and logistics. This campaign was hugely successful and resulting in significant fortune for our partners. This is the start of the revamp of our key counter strategy, which will transform us from being an information provider into a solution provider. This will allow us to provide a differentiated human resource solutions for corporate trends. All have big and the lasting demand for blue-collar or intra-level positions.
The yellow pages and the other local sales categories probably least impacted by the ongoing macro challenges, and they continue to show steady growth since the launch of Dada Daojia for selected home service. We have been focused on partners with high-quality service provider who have standardized their service quality and integrated service protection plan, which establishing closed-loop transactions through our platform. This enhanced service will boost consumer recognition and trust. We will continue to expand the coverage of selected home service to more categories. We also started to provide additional value-added enterprise solutions that include operational, promotional campaign and trading. All of which greatly improved the operational efficiency. We are very pleased with Zhuan Zhuan's progress during the quarter. The US core market still has a huge potential. Zhuan Zhuan has been narrowing this loss this year, while exploring various opportunities for monetization.
In September, Zhuan Zhuan secured $300 million in the Series B financing with a group of investor both Tencent and the 58.com participated existing investor demonstrating our confidence in the business and (inaudible). Zhuan Zhuan is the clear leader in online used cellphone transaction and the highest established sustainable model, which included -- quality inspection or certification and other value-added service. We will continue to replicate this model to other semi-standard and the high value used goods categories.
Regarding out other core investment, 58 Town and Zhuan Zhuan will continue to be both facilitated and encouraged by the great potential opportunity lower PSAP [Phonetic] provide. Low monetization is a low priority focus this year for dot com. We began generating enormous amount of date on potentially hundreds of millions of users and expand our unique organizational capabilities.
This year, we forecast our expanding coverage, improving relationship with local partners and the guided traffic to our centralized new app. This has created synergies between 58.com and the 58 main app, which have laid solid foundation for monetization in the future. In the meanwhile 58.com together with 58 communities, also played an increasingly great threshold in selling our [Indecipherable] with respect for social responsibilities.
Last, but not least, I would like to reiterate, the classified market model continue to be a very relevant and a dependable business model globally. China alone form a massive market opportunity for this model. I can't emphasize this enough. Despite the market uncertainty, we strongly believe in the longer term fundamental trends that support our business and we remain very optimistic about the future growth prospects.
Our strategy remain unchanged. We will solidify and expand our leading market position, sell investment in innovation and both technologies and organizational solutions and the footprint improvements in the user experience of our platform. We are focusing on creating longer term value for our customers and shareholders and the employees.
With that, let me hand over to Wei. Wei, please.
Wei Ye -- Chief Financial Officer
Thanks, Michael. And thank you everyone again for joining our call tonight. I will now walk you through our third quarter financials. Total revenues were RMB4.26 billion, 17.4% increase from the same quarter of last year. Membership revenues were RMB1.2 billion, up 1% year-over-year. Online marketing services revenues were RMB2.8 billion, up 20.1% year-over-year.
In the third quarter of 2019, the total number of paying business users was approximately 3.6 million, a 3% increase from the same quarter of 2018. The uncertain macroeconomic environment impact membership growth, but we were able to partially offset that impact by offering more flexible and customized products and services that are tailored to suit the needs of our customers, generated better return on investments for them and attract more new paying business users.
Among the 3.6 million paying business users, approximately 1.3 million are in the housing category, representing the majority of market share. Approximately 1.6 million are in the jobs category, up slightly both year-over-year and sequentially. These paying user numbers in both the housing and jobs category are far larger than thereof any other pure vertical players based on publicly available data.
Outside of revenue from membership and online marketing services, revenue from e-commerce services and other services, together, resulted in a growth rate of 129% year-over-year. So in very strong momentum.
Gross margin was 88.2%, compared with 89.5% in the same quarter of 2018 due to the above-mentioned minor change in our product mix. Operating expenses were RMB2.9 billion, an increase of 12.4% from the same quarter of 2018.
Sales and marketing expenses in the third quarter of 2019, RMB2.2 billion, an increase of 13.4% year-over-year. Within sales and marketing expenses, advertising expenses in the third quarter were approximately RMB1 billion, which were generally stable compared with the same quarter of last year. Non-advertising sales and marketing expenses in the third quarter of 2019 were approximately RMB1.2 billion, up 26.4% year-over-year.
Research and development expenses in the third quarter were approximately RMB0.5 billion, up 11.1% year-over-year. General and administrative expenses in the third quarter were approximately RMB197 million, up only 5.3% year-over-year. We scaled back advertising expenses in the second half of this year as we used alternative marketing activities to explore new and more effective customer acquisition channels.
Overall, our major operating expenses grew at a slower rate than that our total revenue, a clear reflection of our diligent execution and successful efforts around improving internal efficiency. The total number of employees at the end of the third quarter was approximately 22,000, approximately 2% decrease from the same quarter last year.
As Michael pointed out in his remarks, we continue our structural shift by converting sales and marketing staff into product development and technical staff. This strategic shift will continue to be among our top initiatives. Non-GAAP income from operations was approximately RMB1 billion in the third quarter, up 21.3% year-over-year. Non-GAAP operating margin was 24.4% compared with 23.6% in the same quarter of 2018.
Net other income in the third quarter of 2019 was approximately RMB80 million compared with that net other income of RMB103.7 million in the same quarter of last year.
Non-GAAP net income attributed to 58.com Inc. ordinary shareholders was approximately RMB1 billion in the third quarter of 2019, up 20.7% year-over-year. Non-GAAP net margin was 23.9% in the third quarter of 2019 compared with 23.3% in the same quarter of last year.
Now let's turn to guidance. Based on the Company's current operations, total revenues for the fourth quarter of 2019 are expected to be between RMB4.05 billion and RMB4.15 billion. This represents a year-over-year increase of 12% to 15% in terms of RMB. These estimates reflect the Company's current and preliminary view, which is subject to change.
On that note, we'd like now to begin the Q&A session. Andrea, please begin.
Questions and Answers:
Operator
We will now begin the question-and-answer session. [Operator Instructions] And our first question comes from Thomas Chong of Jefferies. Please go ahead.
Thomas Chong -- Jefferies -- Analyst
Hi, good evening. Thanks management for taking my questions. I have two questions. My first question is about the macro environment. Given the macro environment right now is not that certain, can management comment about how we can add value to our customers and also improve our monetization capabilities on this front?
And my second question is about our competition. Can management talk about the competition -- competitive landscape in property, jobs, user good and others? Thank you.
Jinbo Yao -- Chairman and Chief Executive Officer
Thomas, I will answer the first question. This is a Michael Yao.
[Foreign Speech]
Sure. I think the current macro environment is difficult for everybody, right. It's difficult for us, but actually it's probably more difficult for our customers. So we will always stand together with our customers. And through continued improvement of our offerings in value-added product and services, will not only help our customers to get a better return on investment, but also expand our influence in leading market position.
[Foreign Speech]
Yeah. So actually our traffic supposed to be a mobile traffic has been growing faster than our revenue growth. And so, in other way, our customer has been getting bad effects with the same amount of money and/or even less compared to the past or literally much better return on investment. So this will be our continued efforts in strategy going through this difficult period.
[Foreign Speech]
So we're also at a stage of transforming ourselves from pure traffic provider into a more service and solution provider to our customers. As you can see, there is a strong momentum in e-commerce and other services category, where we actually provide more in-depth service to our customers. I think this kind of service not only help us to understand what exactly our customer needs, but also in the long-term will open up more opportunities for us to grow our platform.
[Foreign Speech]
So, yeah, as I emphasized in my remarks, and again I cannot emphasize it enough, China is massive, massive market with 1.4 billion people, right. And that alone represents a huge opportunity and potential. So for us, we will continue to invest in innovation and user experience. This year we had about 10% increase, research and development headcount. And this trend will continue. We believe in the long run, right, as we point out the structural shift in our total headcount. We're not just sacrificing today's short-term expenses, although we know the trade-off between R&D people and those people, but we are actually investing for our long-term success.
Okay. I guess, I hope this answer Thomas the first question, right.
Wei Ye -- Chief Financial Officer
Your second question is about the competition. Again give it -- I think first, so in our major categories, if you look at housing, again -- we don't see any clear sign of government policy loosening, and the current weak market sentiment, we might have to accept that's the norm for foreseeable future, right. And if you look at the paying business users on our platform, 1.3 million in housing category, that represents a considerable major market share, and we have been holding their market share under -- in terms of competition since April last year, right.
So mostly we are not afraid of any competition. Actually competition always make us stronger. As Michael has internally talked about, actually sometimes a strong enemy actually will -- actually make you even stronger. Okay. So I think housing situation is that, we do have a pressure on membership growth because pretty much we are already having a fair big market share there, but what we are going forward be focusing on is continue to provide more value-added and in-depth service by including SaaS and other technologies like the VR as Michael mentioned in his remarks to adding more tools into our agent customers toolbox and help them to improve their efficiency. So by the end of the day, they will be able to get a better return investment from partnering with us.
Jinbo Yao -- Chairman and Chief Executive Officer
[Foreign Speech]
Yeah. In the past couple of years, right, we do -- we did have a lot of challenges from different verticals. Housing, but also faced like used car and jobs, too. But majority of those rising competitors like us, they live on financing. The private companies and none of them really showing profit as of today. So under a difficult market, those competitors that living on financing, will have a lot more difficulty to continue to find more funding. At the same time, we -- under our proven business model, we have very positive cash flow and very robust business model to support a sustainable and profitable growth. So our expectation is in 2020, the competition situation might favor us more.
[Foreign Speech]
Yeah, so basically if you look at the -- look past of this year, we didn't really make a lot of change from our original plan. We held on our own pace. But we look forward to next year, where we see if the favorable competitive situation, we might, in specific markets become more aggressive just to as we said, solidify and enhancing our leading market position.
Christian Arnell -- Investor Relations
Next question, please.
Thomas Chong -- Jefferies -- Analyst
Thank you.
Jinbo Yao -- Chairman and Chief Executive Officer
Thank you, Thomas.
Operator
Our next question comes from Tian Hou of T.H. Capital. Please go ahead.
Tian Hou -- T.H. Capital -- Analyst
Yeah. Good evening, management. Congratulations on a good quarter in such difficult environment. The question is related to the revenue mixture. I do see the increase in the e-commerce and other business. And so, going forward, Michael and Mr. Ye, how much do you expect this part of revenue as a percentage of the total revenue? Let's say end of 2020 that's first question.
Second question is related to marketing and other operating expenses. So I don't see a lot of increase. And I guess that is really related to the Company's internal control and going forward into next year and how do you plan to manage your operating expenses? Thank you.
[Foreign Speech]
Jinbo Yao -- Chairman and Chief Executive Officer
[Foreign Speech]
Yeah, actually internally, at the beginning of the year, we have the initiative called from sales to service because internally our sales belong to the S grades, but at the same time stands for service too, right. So we want more and more of our sales personnel to become service providers to our customers. They tried to have a deep understanding of our customers' needs and become more like consultant type of growth to our customers and provide solutions.
I think across all our core categories, there is a great -- good opportunity to increase the -- such type of service revenues. We don't have concrete plan to say how -- exactly the ratio will be, but I do expect in couple of years, the revenues from those type of services they become a secondary part of our total revenue. The same, maybe even half. So that's Michael's comments.
Wei Ye -- Chief Financial Officer
On the same note, my take is also again was that -- if that kind of change materializes, we will definitely consider how to report our revenue mix in a more meaningful way to help investors to understand our business.
Jinbo Yao -- Chairman and Chief Executive Officer
[Foreign Speech]
Yeah. In the past, our revenue growth was mainly relied on the total memberships growth and also the online marketing or advertising type of revenues growth. But with the current market environment, we definitely see the pressure on membership growth and we're definitely revamping our key account strategies, where we're -- we're working with -- as Michael mentioned in his previous remarks, something like, he used the example in the jobs category right, we had this super job season, co-branding campaign that we -- pilot was big corporate clients like McDonald's, JD.com [Indecipherable] and Zhaopin. That's a great start that we're trying to provide total solutions for our corporate clients and we definitely will try to divide more and more corporate clients in different categories, and we'll see the percentage of such type of revenue growth in the future.
Tian Hou -- T.H. Capital -- Analyst
Okay. The second question?
Wei Ye -- Chief Financial Officer
Okay. I will take the second question on operating expenses, right. So I think -- so if you look at the big buckets of our operating expenses, we're wary on the -- very conscious way of scaling back advertising. And if you look at the conventional online traffic acquisition channels and probably everyone realize nowadays, the marginal returns on additional traffic -- our new user are definitely declining, right? So we are exploring different kind of marketing activities or even offline type of activities as more effective channels to acquire new customers. 58 Town being one of the example, and also we replicate their model into county and city suburban areas, we call it the city partner programs and also showing very nice momentum this year. So overall for the sales marketing parts, we will have a very cautious view on what we are going to spend on advertising and the marketing expenses will view them as an integral part and looking for the best margin return.
And on the sales and marketing personnel part, as we just mentioned, we're converting them into service lines. At the same time, we're also steadily reducing the pure -- number of pure salesperson and adding those headcount back into our research and development staff. In terms of general and administrative expenses, I think we already showed a very clear records that we have very good control and leverage over that G&A line.
So I think, overall that's for our core businesses and those leverages on the core businesses will enable us to sell funds, our other new initiative like Zhuan Zhuan and 58 Town.
Tian Hou -- T.H. Capital -- Analyst
Okay. That's helpful. Thank you.
Wei Ye -- Chief Financial Officer
Thank you, Hou.
Operator
Our next question comes from Hillman Chan of Citigroup. Please go ahead.
Hillman Chan -- Citigroup -- Analyst
Hello, and good evening Michael.
[Foreign Speech]
Thank you for taking my questions. I have two questions. Firstly, it's also to follow on the competition on recruitment has made a high profile expansion into recruitment, leveraging on the user traffic and the [Indecipherable] amount of merchants from restaurants and local surfaces and mobile perspective, how do we see the competition from Meituan, please?
And my second question is on 58 Town. Could you provide a bit more on the operating metrics for 58 Town initiative? What do you think about the level of investment and the pace of monetization in 2020, please? Thank you very much.
Jinbo Yao -- Chairman and Chief Executive Officer
[Foreign Speech]
All right. Regarding the jobs initiatives that generates a relatively huge PR couple of months ago from Meituan, we really didn't see any concrete actions from their side. Actually during that period, they -- even they came to us -- potential corporations, because you know, they do through their agencies actually recruit them on the -- the delivery crews on our platform. So I think we continue to focus on our own -- user experience, improvement and scaling our platform.
Wei Ye -- Chief Financial Officer
I think the other question Hillman mentioned, like there is other local services categories that also seems to be overlapping between Meituan and us, I would like to make a comment on that too. Michael you can add in more comments. I think although Meituan also call themselves a life service platform, if you look at the life services on both platforms, you realize that's actually a very different type of life services, right. If you look at what's on Meituan, I think their core is around food and also other entertaining type of activities. So, and typically it's more high frequency OK. And nice to have stuff in life.
And the life services on our platform, the [Indecipherable] typically low frequency, but really a sort of must to have type of services when you need them. Okay. So, I would say like the local services category or the yellow page category on our platform, less sensitive to the overall macro environment and really probably besides very few like -- between the high frequency and low frequency categories it's really not much overlap between and us.
Hillman Chan -- Citigroup -- Analyst
Got it. Thank you.
Wei Ye -- Chief Financial Officer
Does that answer your first question? Would you mind to repeat your second question?
Hillman Chan -- Citigroup -- Analyst
Yes. My second question is on 58 Town. Could you please provide a more -- of the latest operating metrics on 58 Town, and how do we think about the level of investment and the pace of monetization in 2020, please?
Wei Ye -- Chief Financial Officer
Okay. So I'll take on that one. Okay. Yeah, we continue to expand the coverage of 58 Town this year. And at the same time, we also had a lot of programs to improve the quality of our local town partners. The priority this year for 58 Town is to prepare for monetization in near future. So monetization itself is not a top priority. But we are laying the foundation for it, and so we are ready to pick up the monetization next year. And the key actions we're taking in that category is one, we want to definitely improve the -- enhance the quality of the traffic we're generating.
Last year, at the beginning, you would focus more on the quality, and once you reach certain level of traffic, now you want to really think hard about the quality of the traffic and the potential conversion rate you can get from those type of traffics, right.
And second thing is that we want to -- guide those traffic that's generated from the WeChat ecosystem, back into our centralized app. We did have a specific app for 58 Town, which we called 58 local version, that's specially designed for that purpose. It's only when you guide those traffic back to the app, then you have a better chance to monetize the traffic.
So those are the several key actions we're taking this year to get ourselves already. And I think next year the monetization for 58 Town coming from two different places. First, as we see those additional traffic in -- actually additional users from the 58 Town ecosystem, they're going to be able to contribute additional revenue for our existing core businesses. But if you look at the 58 Town content categories we realize that it's pretty much identical with properties and jobs and used goods, used cars and local services as the major leading traffic sources, right.
And on the other side, 58 Town does have its own unique organizational capability. Now we have orders local town partners on our field that they can actually do a lot of different things. For example, we can actually provide a sort of like a local exhibition for a specifically targeted OEM client. So there is definitely more room for imagination. And we'll continue to be fascinated by the financial we have from 58 Town. And As I said, we expect to see some monetization to pick up next year.
Did I answer your question?
Hillman Chan -- Citigroup -- Analyst
Yes. Thank you. Thank you, Michael and thank you [Indecipherable]. Thank you.
Operator
Our next question comes from Eddy Wang of Morgan Stanley. Please go ahead.
Eddy Wang -- Morgan Stanley -- Analyst
[Foreign Speech]
So I also have two questions. The first question is about Zhuan Zhuan. So given its reasons, the active finance, do we expect there will be salaries modernization of Zhuan Zhuan in 2020 versus this year? This is my first question.
And then my second question is related to the primary housing sector. So as I mentioned that the macro and market condition is still relatively weak for the secondary housing sector. Were we more focused on the primary housing strategy in the next year? And will it be a benefit to your -- to the steps, the strategy you just mentioned about the KA? So better, more focus on the primary housing in the next year. So yeah, that's the second question. Thank you.
Jinbo Yao -- Chairman and Chief Executive Officer
[Foreign Speech]
Okay. I'll tackle the Zhuan Zhuan part first. So yeah, I think the latest financing for Zhuan Zhuan, I think it's enough to support them for the next two, three years. And it really doesn't have a real impact on 58's cash flow because majority of the financing from third-party investors. So Zhuan Zhuan had very nice development this year. They're still exploring the monetization channels to establish a differentiated business model. They're very successful in the used cellphones category, definitely a proven and sustainable business model with their value-added service. So they're going to replicate their business model into other similar type of categories such as iPad, laptop or other 3C [Phonetic] categories or other categories that share the same characters that one, has the relatively high unit value; two, is -- there's a way that you can transform the non-standards product into a semi-standard way that's recognized by the consumer; and three, the consumers willing to pay for the value-added service such as quality inspection, authentication and other type of services. So they definitely will continue to expand the coverage into new categories, and we expect its momentum of revenue growth will continue next year.
[Foreign Speech]
All right. So on primary housing, as you all know, remains to be a tough market for the property developers, and most of them are under tremendous cash flow pressure. So they want to sell the inventory as soon as possible. And actually, that gives the primary housing market advertising a very good opportunity in recent years. Our primary housing did gain a lot of market share and showed a very nice growth, and we are cautiously optimistic that trend may continue in 2020.
And on the side note, we also had formed a joint venture with a work union and Tencent [Phonetic] back in August. And in this joint venture, we're aiming to actually get deeply involved in the transaction -- transactional service with the developers. 58's role although only a minority position in the joint venture, we'll be building a platform and mobilizing our -- all the agents on our platform. And our partners, work union and Tencent will have their field forces to work with the developers and with the agent-based platform to help the developer to sell those primary housing. We believe such model will make us a major player in the future, and that will definitely help us to accumulate also more transactional data for our future growth.
I hope this answers the question.
Eddy Wang -- Morgan Stanley -- Analyst
Yes. Thank you. Thank you, Yao. Thank you, Ye.
Operator
This concludes our question-and-answer session. I would like to turn the conference back over to Christian Arnell for any closing remarks.
Christian Arnell -- Investor Relations
That concludes the conference call for tonight. Thank you very much for joining. If you have any questions or comments, please don't hesitate to reach out to the Investor Relations team. Good night.
Operator
[Operator Closing Remarks]
Duration: 65 minutes
Call participants:
Christian Arnell -- Investor Relations
Jinbo Yao -- Chairman and Chief Executive Officer
Wei Ye -- Chief Financial Officer
Thomas Chong -- Jefferies -- Analyst
Tian Hou -- T.H. Capital -- Analyst
Hillman Chan -- Citigroup -- Analyst
Eddy Wang -- Morgan Stanley -- Analyst
