Q4 2023 36Kr Holdings Inc Earnings Call

Participants

Jianan Ding; Investor Relations Manager; 36Kr Holdings Inc

Dagang Feng; Co-Chairman of the Board, Chief Executive Officer; 36Kr Holdings Inc

Lin Wei; Chief Financial Officer; 36Kr Holdings Inc

Shan Jiao; Analyst; China International Capital Corporation (Hong Kong) Limited

Lingyi Zhao; Analyst; SWS Research Co., Ltd.

Peipei Qiu; Analyst; Industrial Securities

Ricky Liu; Analyst; Sealand Securities

Presentation

Operator

Ladies and gentlemen, thank you for standing by for 36Kr Holdings Inc., fourth quarter and fiscal year 2023 earnings conference call. (Operator Instructions) Today's conference call is being recorded.
I will now turn the call over to your host, Jianan Ding, IR Manager of the company. Please go ahead, Jianan.

Jianan Ding

Thank you very much. Hello, everyone, and welcome to 36Kr Holdings' fourth quarter and fiscal year 2023 earnings conference call. The company's financial and operational results were released earlier today and have been made available online. You can also view the earnings press release by visiting the IR section of our website at ir.36kr.com.
Participants on today's call will include our Co-Chairman and CEO, Mr. Dagang Feng, and our Chief Financial Officer, Ms. Lin Wei. Mr. Feng will start the call by providing an overview of the company and performance highlights of the quarter in Chinese, followed by an English interpretation. Ms. Wei will then provide details on the company's financial results before opening the call for your questions.
Before we continue, please note that today's discussion will contain forward-looking statements made under the Safe Harbor provisions of the US Private Securities Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, the company's results may be materially different from the views expressed today. Further information regarding these and other risks and uncertainties is included in the company's prospectus and other public filings as filed with the US SEC. The company does not assume any obligation to update any forward-looking statements except as required under applicable law.
Please note that 36Kr's earnings press release and this conference call include discussions of unaudited GAAP financial measures as well as unaudited non-GAAP financial measures. 36Kr's earnings press release contains reconciliation of the unaudited non-GAAP measures to the unaudited GAAP measures. And please note that all amount numbers are in RMB.
I will now turn the call over to our Co-Chairman and CEO, Mr. Dagang Feng. Pal, please go ahead.

Dagang Feng

(interpreted) Thank you. Hello, everyone. Thank you for joining our fourth quarter and fiscal year 2022 earnings conference call.
2023 was an extraordinary year for 36Kr as we continuously strengthen our content ecosystem, leveraging our periods content creation partners and comprehensive marketing offerings we effectively drove growth in both our user base and monetization. As a result, our annual revenue reached RMB340 million, up 5% year over year and we sustained our high gross profit margin of 54%.
2023 also marked the end of the year with explosive growth in AIGC by actively embracing the vast opportunities brought by this industry transformation, we were able to dive deeper into visionary AGI applications, accelerating AGI adoption in real-world scenarios. Let me share some additional details of our 2023 progress across three core areas: the enrichment of our content ecosystem, IT product development, and the comprehensive AI applications.
I will start with our content ecosystem. While we further enrich and diversify our content metrics continuously creating high-quality content on multiple fronts, in 2023, we built upon our flagship channels, including 36Kr and 36Kr Pro by accelerating our reach in the vertical. We rolled out high quality content specific account like the Emergency of Intelligence, 36Kr Auto Future Consumption, PR Carbon, and the Hardcore KR among others. These accounts made our metrics more comprehensive, bringing both broad content coverage and a great depth of expert in specialized domains to provide users with invaluable insights into industry trends and evolving business dynamics.
At the same time, we continue to tailor content experiences for younger generations by launching our Oh! Youth and tied vertical media channels, featuring a broad content matrix of text and graphics, comics and customized videos. This channel successfully engages younger audiences, greatly extending our content reach with approximately 40 accounts so far covering advanced manufacturing digitization, dual carbon, and ESG hard-core technology, highly specialized and innovative enterprises, consumer lifestyles and much more. We have successfully introduced and fostered a solid content ecosystem.
We also expanded our footprint across various channels, crafting a comprehensive circulation measures, encompassing major new media platforms like Weibo, Xiaohongshu, Toutiao, Zhihu, Bilibili, Douyin, Kuaishou, et cetera. China exposure brings us wider overall dissemination, higher visibility for our prime content with blockbuster articles emerging back to back throughout 2023. 740 of our articles achieved over 10,000 views. The ultimate Weibo trending topic list with 23 hot search topics and over 100 hotly debated topics, thanks to our continued stream of fresh perspectives.
Our consistent production of high-quality content standard and diversified our user demographics, further elevating user engagement and stickiness. As of the end of 2023, we had over 32.7 million followers, marking 11 consecutive quarters of growth.
Moreover, our overbill content ecosystem is now a more comprehensive and diverse. We explore a growing area of content formats, including texts, graphics, and short and long-form videos as well as audio and live streaming. In terms of short video, our exceptional content creation capabilities are as widespread visibility and rake views from users. Our short video followers exceeded 9 million by the end of 2023, including a significant 2.2 million on Bilibili alone.
Moving on to long-form video, in 2023, we unveiled our first long video talk show series, Foreseeing 2033, owing to its roster of distinguished guests and in-depth discussion, a rarity within the industry. Our show rapidly captured audience attention and imagination. So far, we have aired two productive seasons of the show. As a host, I discussed and explored exciting aspects of the New Economy with visionaries from various industries, including AI triple lasers, traditional automotive, manufacturing of vitamins, leaders in bulk training, electric vehicle sector, carbon neutrality industry, luminary, and capital market experts. Live streaming Foreseeing 2033 at Youku and Beijing Radio and Television station also marked a pivotal milestone for us. They extended our reach beyond social media, successfully breaching out into long video platforms and television networks and fostering a broader content portfolio and closed loop ecosystem.
In terms of live streaming, we integrated our resources and maximize the utilization of WeChat channels to launch in live streaming IP, leave from [KR Star], primarily centered on two programs: News Watch and CEO Tips. In 2023, we're hosting 95 live streaming sessions, addressing a diverse spectrum of trending topics, including perspectives on employment at Internet giants, industry know-how, such as AI's role in corporate cost reduction and efficiency enhancement and global expansion of Chinese brands. These coordinated initiatives are aimed at bringing more in-depth content and services models to our users and clients alike.
In the audio line, 36Kr's audio channel has emerged as a top-tier streamer on platforms like Himalaya, delighting listeners with a variated slate of initiatives such as [8:15 Morning Talk], Major Moments, and Business Intelligence Hub, garnering massive acclaim. We also further deepened our commitment to expanding our audio content portfolio and functionality in 2023 with the launch of our live podcast, Get Off Work, Have Fun.
Our second main area of progress is in IP product development. We consistently reinforce our medium value by concentrating our medium platforms competitive barriers with high-quality content offerings. In 2023, we continuously augmented our content metrics by creating and nurturing our content IP with programming like those I just mentioned, Foreseeing 2033 and Oh! Youth series. We also launched a diverse range of initiatives supporting our newer IP, including texts and graphics, short videos, and live streaming programs following reinforcing our content influence.
In terms of event IP innovation, we broadened the scope of our Annual Flagship WISE Conference to encompass all business domains completing its evolution from the wiring of the New Economy Conference to the WISE King of the Business Conference. This strategic graduation enriches the events of diversity, while also providing its audience with broader industry perspectives. We also unveiled a brand-new summit Waves as well as two culture and leisure IP series, Surprise and The Incredible, successfully driving growth in our 2C business and facilitating enterprise client acquisition.
Furthermore, 36Kr emphasizes IP-oriented upgrades to enhance its branded service offerings in 2023 as a keen observer and interpreter of industry and market trends, such as KR Research Institute has maintained its focus on conducting thorough research on state-of-the-art technologies, innovative trends, and business advancement through high precision data and actuate analysts. We support government and corporate clients with tailored consulting services, offering invaluable perspectives and insights to drive industry transformation and innovation.
Additionally, as a rising star in the business training field, 36Kr business school offers a diverse array of courses, including open lectures, explosive fireside chats with C-level executives, corporate site visits, and interviews. We also advanced our development of degree-based programs for senior executives in the New Economy sector in China, teaming up with globally-esteemed institutions such as Oxford University, business schools in France, and Queen Mary University of London, among others, to jointly deliver world-class masters and doctoral programs.
Moreover, in response to the escalating need for AI applications, we joined forces with top-tier institutions, including Peking University and Tsinghua University to unveil the global intelligent entrepreneurial initiative, further the propelling AI advancement. As a result, 36Kr Business School's IP has gradually emerged as a permanent player in the training sector, enabling recent graduates business elect as well as AI professionals with all-in-one training solutions, empowering them to anticipate and amplify the new economic growth trend.
The third and final aspect I want to highlight today is how we have advanced our AI applications in innovative scenarios, seizing new opportunities with the emergence of large language models where we strategically integrated LLM technologies throughout our content ecosystem and pioneer the use of AI technology in opening at Taobao stores. This significantly improved the efficiency of store operations while reducing relevant costs.
During the Asian Games, we innovated once again creating an AI-driven Asian Game blogger on Xiaohongshu and teaming up with Alibaba Tongyi AI model. This joint initiative marked a significant content creation milestone for us while also underscoring 36Kr's human and outstanding execution capabilities in AI applications.
In 2023, by virtue of our outstanding proficiency in creating business and test finance content, we were one of the first companies invited to partner with Baidu's ChatGPT ecosystem. This cooperation has since evolved into a more in-depth strategic partnership with Baidu, under which we're effectively advancing innovation and the commercialization of AI technology in content production and enterprise services.
Furthermore, leveraging the inherited synergies between AIGC technology and the content production industry, we maximize the utilization of AIGC technology across content production activities, including information identification, text progressing, and image generation. This upgrade effectively reduces costs while enhancing efficiency, ongoing updates, and interrelations of AI-powered video tools will also lower the costs associated with video production going forward.
Moreover, we continued to broaden our business goal by actively promoting AI applications across diverse business scenarios. Our AI power solution for financial report importation jointly launched with SenseTime, empower customers with unparalleled insight into corporate and financials by harnessing AI technology, ensuring our subscribers receive a superior level of service and value.
Additionally, we plan to unveil an area of AI-driven product in 2024, such as corporate briefings and medium spotlight seekers, among others. Through the strategic deployment of AI technologies, we broaden the preview and the position of our customer outreach initiatives effectively connecting with the diverse spectrum of enterprises and organizations previously beyond reach due to resource intensive workloads and manpower limitations.
In short, through our enriched content ecosystem, growing matrix of services and products, and extensive AI empowerment, we have continuously strengthened our commercialization capabilities resulting in solid revenue growth. Now I'd like to take a closer look at the commercialization progress we made in each segment in 2023.
Starting with advertising, revenue increased by 8% year-over-year. We continue to craft innovative content marketing strategies and expanded into diverse marketing format like text, graphics, short- and long-form videos, audio and live streaming to fulfill client holistic branding needs. Our ongoing service innovation drove ARPU up by 17% year over year.
To expand our industry footprint, we ramped up advertising initiatives in emerging sectors such as new energy vehicles and luxury goods consumption while also broadening partnerships with legacy brands in traditional industries like apparel and food. We also continue to diversify our advertising commercialization channels beyond revenue growth across our flagship platforms, like the 36Kr website, 36Kr app, WeChat, and Weibo, we made significant headway in monetized like Bilibili, Xiaohongshu, Zhihu, and WeChat channels, among others.
Moving on to short video, our short video business continued to excel which is contributing as a percentage of advertising revenue consistently on the rise. Our short videos attracted a large following with high-quality content, positioning us as a standout among corporate accounts across various platforms. Notably, our short video team covering the automotive sector has garnered widespread claims within the industry for its top-notch content. This drove ongoing expansion of its follower base as well as partnerships with esteemed auto brands, including BMW, Mercedes-Benz, Denza, and [SUM]. This accomplishment highlights our competitive edge in the short-video sector and lay a robust foundation for our future expansion.
Now let's turn to enterprise value-added services. Throughout 2023, 36Kr remain committed to verticals such as new technology, new energy, and new consumption, posting approximately 20 industry summits to more directly and efficiently empowered enterprises. We extended our reach to younger demographics with our all new summit Waves, integrating venture capital technology, culture, and music themes to zero-in on young business founders and investors. This celebration of yields for entrepreneurship amasses over 83 million views.
Meanwhile, more than 300 distinguished commercial and economic experts, scholars, business analysts, and investors, including [Kaifudi], [Yasingzan], and [Yosingzuan] joined us at our year-end flagship summit, the WISE 2023 Kings of Business. The event vibrant discussions spark new ideas and innovation. We also enhanced this year's conference with certain functional upgrades to amplify its networking potential and foster even more social engagement among users.
In addition to off-line initiatives, we continue to make strides in our consulting services and other enterprise service offerings. Throughout 2023, we continue to fortify 36Kr research institutes expertise in industry research, regularly issuing top-notch research report with valuable insights, including industry experts on an array of topics like new energy, global expansion, automation, smart agriculture, and enterprise SaaS, et cetera, while forging in-depth alliances with leading companies like Lenovo, Alibaba Cloud, Baidu, Douyin, and NetEase Cloud Music among others.
Furthermore, this year, we opposed to further deepen our engagement with the government and the public service system, drawing upon comprehensive graph of government structures at different levels and our wealth of service expertise will offer customers with integrated suite of services, including facilitating industry-specific partnerships and investment inflows addressing their varied needs with precision.
Next up for subscription services, we continue to refine our membership system and subscription product offerings, achieving significant year-over-year annual revenue growth of 21%. One good example is our optimization of 36Kr business school services. As part of our aforementioned innovative to craft a permanent business training IP in addition to consistently refining our premium training courses, including funding acceleration camp, we also dive deeply into the development of international degree-based programs. This now feature instead for lectures distinguished leadership scholars but professors covering an array of exciting topics. As a result, our subscription services app surged to over RMB140,000, reflecting a notable improve in our holistic commercializing capabilities.
In short, 36Kr sustained a solid growth trajectory throughout 2023. We achieved a full year revenue of RMB340 million, up 5% year over year, thanks to our peerless content creation companies, robust IP assets, actively engaged users, and a diversified product. As of the end of 2023, we had over 32.7 million followers, a surge of 14% year over year that marked our 11th executive quarter of growth. 2023 also ushered in the era of AIGC, large language models are reshaping and redefining nearly every sector of the economy, content production included, driving a new wave of technological transformation.
36Kr has actively embraced the AI boom, further optimizing content production and commercialization efficiency through visionary AI applications. Stepping into 2024, as a provider and facilitator of advanced productivity, we opposed to hone our competitive edge in content fruition, broaden the reach of our product and service offerings, and for the harness AI technology to empower high-quality development among new economy stakeholders.
With that, I will now turn the call over to our CFO, Lin Wei, who will discuss our key financial results. Please go ahead, Lin.

Lin Wei

Thank you, pal. Now I'd like to walk you through more details of our fourth quarter and fiscal year 2023 financial results. Please note our numbers are in RMB, unless otherwise stated.
Total revenues were RMB103.3 million in the fourth quarter of 2023, a 7% increase from 96.6% in the same period of last year. Total revenues for the full year of 2023 were RMB340.2 million, a year-over-year increase of 5.5%. Online advertising services revenue were RMB68.6 million in the fourth quarter of 2023, an increase of 10% compared to the same period of last year.
For full year of 2023, our online advertising services grew by 8% year over year to RMB238.7 million. The increase was primarily attributable to more innovative marketing solutions we provided to our customers as well as proactive sales strategies we adopted during the year. The average revenue per online advertising customer in 2023 were RMB489,000, a 17% increase year over year.
Enterprise value-added services revenues were RMB26.3 million in the fourth quarter of 2023, a 4% increase from the same period of last year. For full year 2023, our enterprise value-added services revenue was RMB67.3 million compared to RMB72.6 million in the previous year. The 7% decrease was primarily due to the transition of our integrated marketing services, partially offset by the growth of our other enterprise value-added services in 2023.
Subscription services revenues were RMB8.4 million in the fourth quarter of 2023 compared to RMB8.9 million in the same period of last year. The slight decrease was primarily attributable to the structural changes to our institutional clients in China, partially offset by the increase in individual subscription services. For full year 2023, our subscription services revenue was RMB34.2 million, representing an increase of 1% year-over-year. The increase was primarily attributable to our continuous efforts to offer high-quality subscription products to our subscribers, especially individual subscribers.
Cost of revenues was RMB45.8 million in the fourth quarter of 2023 compared to RMB47.6 million in the same period of last year. The decrease was primarily attributable to the optimization of personnel-related costs. For full year 2023, our cost of revenues was RMB158.2 million compared to RMB137.8 million in the previous year. The increase was primarily attributable to higher content costs and fulfillment costs.
Gross profit was RMB57.6 million in the fourth quarter of 2023, increasing by 18% from the same period of last year. Gross profit margin was 56% in the fourth quarter of 2023, up 5 percentage points from 51% in the same period of last year. For the full year of 2023, our gross profit was RMB182 million compared to RMB184.6 million in the previous year. Gross profit margin for full year 2023 was 54% compared to 57% in the previous year.
Operating expenses were RMB70 million in the fourth quarter of 2023 compared to RMB69 million in the same period of last year. For full year 2023, operating expenses were RMB276.2 million compared to RMB229.2 million in the previous year.
Sales and marketing expenses were RMB30.3 million in the fourth quarter of 2023, a decrease of 8% from the same period of last year. This is primarily attributable to the decrease in payroll-related expenses, partially offset by the increase in marketing expenses. For full year 2023, sales and marketing expenses were RMB127.5 million compared to RMB122.1 million in the previous year. The slight increase was primarily attributable to the increase in marketing expenses and promotion fees during the year.
G&A expenses was RMB35.3 million in the fourth quarter of 2023 compared to RMB21.7 million in the same period of last year. The increase was primarily attributable to the increase in the loss of credit losses. For full year 2023, G&A expenses were RMB107 million compared to RMB52.1 million in the previous year. The increase was mainly attributable to the increase in allowance for credit losses as well as certain one-off expenses, including severance payments as we optimized our organization and office lease termination fees as we moved our headquarters office in fiscal year 2023.
Research and development expenses were RMB4.4 million in the fourth quarter of 2023, a 70% reduction compared to RMB14.5 million in the same period of last year. For full year 2023, our research and development expenses were RMB41.7 million, 24% down from RMB55 million in the previous year, as we proactively embrace AI technology and streamlined our research and development teams, resulting in a decrease in payroll-related expenses.
Share-based compensation income recognized in cost of revenues, sales and marketing expenses, research and development as well as G&A expenses totaled RMB0.4 million in the fourth quarter of 2023 compared to SBC expenses of RMB4.6 million in the same period of last year. This fluctuation was primarily due to the reversal of share-based compensation expenses related to future in Q4 '23. For the full year of 2023, the total amount of share-based compensation expenses was RMB4.7 million compared to RMB13.9 million in the previous year.
Other expenses were RMB5.1 million in the fourth quarter of 2023 compared to other expense of RMB1.2 million in the same period of last year. For full year 2023, other income was RMB4.9 million compared to other income of RMB67.5 million in the previous year. The decrease was primarily because the company recognized RMB38 million gain on disposal of subsidiaries and RMB16 million of long-term investment income in 2022 but recognized RMB8.1 million fair value loss of long-term investments in 2023.
Net loss was RMB17.7 million in the fourth quarter of 2023 compared to a net loss of RMB21.5 million in the same period of last year. For full year of 2023, our net loss was RMB89.2 million compared to net income of RMB22.6 million in the previous year. Non-GAAP adjusted net loss was RMB18.1 million in the fourth quarter of 2023 compared to non-GAAP adjusted net loss of RMB16.9 million in the same period of last year. For full year 2023, non-GAAP adjusted net loss was RMB84.6 million compared to non-GAAP adjusted net income of RMB36.5 million in the previous year.
Net loss attributable to 36Kr ordinary shareholders was RMB18.8 million in the fourth quarter of 2023 compared to net loss attributable to 36Kr ordinary shareholders of RMB20.8 million in the same period of last year. For full year of 2023, net loss attributable to 36Kr ordinary shareholders was RMB90 million compared to net income of RMB21.9 million in the previous year.
Basic and diluted net loss per ADS were both RMB0.45 in the fourth quarter of 2023 compared to net loss per ADS of RMB0.50 in the same period of last year. For full year 2023, basic diluted net loss per ADS were both RMB2.16 compared to basic and diluted net income per ADS of RMB0.53 in the previous year.
As of December 31, 2023, the company had cash, cash equivalents and short-term investments of RMB117 million compared to RMB160 million as of September 30, 2023.
This concludes all of our prepared remarks today. We will now open the call to questions. Operator, please go ahead.

Question and Answer Session

Operator

(Operator Instructions) Shan Jiao, CICC.

Shan Jiao

(spoken in Chinese) Congratulations to a solid growth in the revenue in 2023. How does the management view the advertising revenue trend in the first quarter and in 2024? Thank you.

Dagang Feng

(interpreted) Thank you. Despite persistent macroeconomic changes in 2023, our advertising business demonstrated solid growth momentum, achieving 8% year-over-year revenue growth. This success is attributable to our ongoing commitment to enhancing content influence and our ongoing client base expansion across diverse industries, particularly among top-tier and mid-sized advertisers. The steady growth trend in ad spending by our advertisers propelled a year-over-year increase in our ARPU of 17%, a testament to 36Kr's robust business resilience.
In addition, we have been actively exploring and harnessing AI technology to enhance marketing and craft innovative strategies including personnel, advertising content generation, advertising placement, and live streaming featuring digital influencers, et cetera. As such, we are providing our customers with marketing solutions that are smarter, more efficient, and more innovative.
We are cautiously optimistic about our advertising growth trajectory for 2024, aimed at the ongoing macroeconomic rebound, sustained stimulus policies and new development strategies such as advanced productivity as a leading service provider for and the facilitator of New Economy and advanced productivity stakeholders. We expect robust growth in our advertising business in 2024, particularly in industry sectors such as growing demand from government business and AI business sectors as well as the need to market advanced technologies from traditional asset prices. Thank you.

Operator

Lingyi Zhao, SWS Research.

Lingyi Zhao

(spoken in Chinese) What is the latest progress on both long- and short-video business? What are the plans for our further explore growth potential? And what is the company's layout and further developed plan in generative AI? Xie Xie.

Dagang Feng

(interpreted) Thank you for your question. Well, for your first question, our short video adds both the wider customer acceptance and the higher ARPU compared to other advertising formats providing a major part of the company's overall advertising revenue in 2023, leveraging our peerless content creation and a substantial influence across major platforms commercial various leading companies. This generated revenue totaling (technical difficulty) accounting for over 20% of the company's total advertising revenue. At the same time, our engaging content across finance, economics, and useful lifestyle garnered website across major platforms like Bilibili, Douyin, Kuaishou, et cetera. As of the end of 2023, our short-video followers reached 9 million, including a significant 2.2 million on Bilibili alone.
Regarding long videos, throughout 2023, our long video talk show series, Foreseeing 2033, roster of distinguished and in-depth analysis, a rarity within the industry. Our show rapidly captured audience attention and achieved a substantial monetization success while earning growing reviews as two seasons amass over 350 million views. We also thrilled about the two programs of our upcoming series, Foreseeing 2034, which is in full swing.
In 2024, we will deepen both short- and long-video development, stepping up our investments in content creation and service customization and exploring a wide array of formats. We have a handful of long-video programs in the pipeline which we will further enhance (technical difficulty).
Now for your second question, as we all know, 2023 ushered in the area of AIGC. As a new economic content creation platform, 36Kr skillfully leverage the inherited synergies between content creation and AIGC technology. We rolled out the Emergency of Intelligence, a specialized account focused on providing high AIGC tech content. We also further deepened our integration of AIGC with content production, actively harnessing AIGC technology for content creation across the broad copyrighting and translation to image generation and more, reducing cost and inefficiency.
In addition, leveraging our keen acumen vision for AI technology, we pioneered the process of opening a Taobao store exclusively using AI. During the Asia games, we innovated once again to create an AI-driven Asia Games blogger on Xiaohongshu. We also teamed up with Alibaba Tongyi AI model. We have also advanced AI applications across diverse scenarios and unveiled array of AI-driven perspectives, such as the AI financial report interpretation launch in collaboration with SenseTime as well as a company daily brief and medium coverage outreach.
These offerings empower customers with intelligent information collection, analysis, and reporting services. Through the strategic development of AIGC technology we broadened the preview and position of our customer operation initiatives effective enacting with a diverse spectrum of enterprise organizations previously beyond reach due to resource intensive footnote and manpower limitations.
Thank you for your questions. Next, please.

Operator

Peipei Qiu, Industrial Securities.

Peipei Qiu

(spoken in Chinese) I will translate my question. The subscription service business is growing faster than expected. So what are the main factors behind this? And what are the new growth strategies for this segment in the future? Thank you.

Dagang Feng

(interpreted) While the rapid growth in our subscription services was primarily propelled by the launch of (technical difficulty) like I just mentioned, throughout 2023, as we diligently optimize our premium training courses, that venture capital class and funding acceleration cap, we also joined hands with global esteemed institutions, deliver world-class and programs for corporate executives. Our subscription services ARPU surged to over RMB140,000. Moreover, in response to the escalating need for AI expertise and applications, we partnered with top-tier institutions, including Peking University and Tsinghua University to unveil the global intelligent entrepreneurial initiative, enabling participants to further advance AI awareness and AI utilization through hands-on training.
In 2024, we will continue to diversify our core course offerings and welcome more institutions and partners, continually enriching our portfolio of training options. We are actively expanding our AI-driven subscription offerings to cater to both 2C and 2B segments, including AI-powered solutions for financial report interpretation, corporate briefings, and more by harnessing AI technology for intelligent information, question, analytical intelligence, and reporting, among other things. We ensure our subscribers receive a superior level of service and value for accelerating the growth in our subscription services.
Thank you. Next question, please.

Operator

[Ricky Liu], Sealand Securities.

Ricky Liu

(spoken in Chinese) What are the growth prospects for 2024? Thank you.

Dagang Feng

(interpreted) So looking back on 2023, despite macro uncertainties and shifting external dynamics, we delivered solid results with 5.5% year-over-year revenue growth. We are cautiously optimistic of 2024 and we expect to sustain revenue growth and improved profitability. For one thing, we will further enrich our content ecosystem and reinforce our products and services. We will also actively maximize utilization of AIGC technology across content production initiatives and launch additional AI-driven products to engage with a diverse spectrum of enterprises and clients previously beyond reach due to resource intensive workloads and manage our limitations.
Moreover, the introduction of the notion of advanced productivity has fostered a strong sense of confidence and assurance across the company, giving our comprehensive offerings that support and empower a diverse spectrum of businesses. We are well positioned to capture greater commercialization opportunities arising from this new strategy. Furthermore, with the optimization of our organizational structure and systematic CapEx in cost and expenses, we are posed to advance our goals of cost-reduction and efficiency enhancements which will further bolster our operating leverage, driving overall profitability to new heights. Thank you.

Operator

As there are no further questions, I'd now like to turn the call back over to the company for closing remarks.

Jianan Ding

Thank you once again for joining us today. If you have further questions, please feel free to contact 36Kr Investor Relations through the contact information provided on our website.

Operator

This concludes this conference call. You may now disconnect your lines. Thank you.

Portions of this transcript that are marked (interpreted) were spoken by an interpreter present on the live call. The interpreter was provided by the company sponsoring this event.