Autohome Inc

NYSE:ATHM

Earnings Call Analysis

Autohome's Q3 Performance: Revenue Growth Despite Industry Challenges

In the third quarter of 2024, Autohome reported net revenues of RMB 1.77 billion, up 3.1% year-over-year, driven by increased transaction volumes in new retail. However, operating profit decreased to RMB 83 million from RMB 166 million a year prior, alongside a contraction in gross margin to 77%. Despite the ongoing price war within the auto industry, new energy vehicle revenue surged by 54%. Autohome also authorized a USD 200 million share repurchase plan and established a USD 1.15 per ADS dividend, underscoring a commitment to shareholder returns amid challenges. The average mobile DAU increased by 5.6%, reflecting robust user engagement.

Navigating a Challenging Landscape

Autohome, a leading online platform in the automotive industry, is currently navigating a complex environment marked by a prolonged price war among major car manufacturers. This competitive climate has persisted for over 1.5 years, exerting pressure on profit margins across the sector. As of January through September 2024, the average profit margin for the auto industry stood at a modest 4.6%, significantly below the industrial average of 6.1%. The effects of this price war have rippled through the market, resulting in decreased profitability for dealerships and an increased reliance on discounting to meet sales targets.

Growth Amidst Adversity

Despite these headwinds, Autohome has reported growth in critical areas. In the third quarter of 2024, the company achieved net revenues of RMB 1.77 billion, a slight increase of 3.1% year-over-year. This growth was bolstered by strong performance in media services and online marketplace segments, which together saw increases in transaction volumes and revenues. Notably, Autohome's mobile daily active users (DAUs) rose by 5.6% year-over-year, exceeding RMB 70 million for the first time, highlighting the platform's expanding influence.

Strategic Innovations and Market Penetration

Autohome is actively enhancing its offerings and expanding its presence in lower-tier markets. The company has successfully launched over 500 offline auto shows and increased its network of stores to more than 50 locations nationwide, blending online and offline strategies to optimize customer engagement. These initiatives are designed to create a seamless purchasing experience and to better serve the growing demand for new energy vehicles (NEVs), whose sales have outpaced other market segments, increasing by 54% compared to last year.

Financial Performance and Shareholder Returns

The third quarter financials indicate a notable decline in overall profitability. Operating profit fell to RMB 83 million, down from RMB 166 million year-over-year, reflecting the pressures on margins due to rising operational costs. In terms of shareholder returns, Autohome announced a cash dividend of USD 1.15 per American Depository Share (ADS), totaling approximately RMB 1 billion, to be distributed by March 2025. Additionally, a new share repurchase program was authorized, allowing for the buyback of up to USD 200 million of its shares over the next year, demonstrating the management's commitment to maximizing shareholder value.

Future Outlook and Strategic Directions

Looking ahead, Autohome remains cautiously optimistic about its prospects. The management anticipates that as the ongoing price war begins to moderate and with supportive government policies for NEV adoption, there is potential for market recovery. However, they caution that short-term challenges remain, especially in the used car market facing fluctuations in pricing and demand. Measures are being taken to innovate further and explore new business models, especially through collaborations with partners like Ping An Group, to enhance operational efficiencies and broad service offerings.

Earnings Call Transcript 2024-Q3

[Operator]

Ladies and gentlemen, thank you for standing by for Autohome's Third Quarter 2024 Earnings Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded. [Operator Instructions] A live and archived webcast of this earnings conference call will also be available on Autohome's IR website. It is now my pleasure to introduce your host, Sterling Song, Autohome's IR Director. Mr. Song, please go ahead.

[Sterling Song, executive]

[Audio Gap] on the company's website, at ir.autohome.com.cn. Joining me today on today's call are Chief Executive Officer, Mr. Tao Wu, and Chief Financial Officer, Mr. Craig Yan Zeng. Management, please, will go through their prepared remarks, which will be followed by a Q&A session where they will be available to answer all your questions.

Before we continue, please note that the discussion today will contain forward-looking statements made under the safe harbor provision of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from our current expectations. Potential risks and uncertainties include, but are not limited to those outlined in our public filings with the U.S. Securities and Exchange Commission and the Hong Kong Stock Exchange.

Autohome doesn't undertake any obligation to update any forward-looking statements, except as required and applicable law -- please also note that Autohome's earnings press release and this conference call include discussions of certain unaudited non-GAAP financial measures. A reconciliation of the non-GAAP measures to the most directly comparable GAAP measures have been found in our earnings release today.

I will now turn the call over to Autohome's CEO, Mr. Wu for the opening remarks. Please go ahead, Mr. Wu.

[Tao Wu, executive]

[Interpreted] Thank you, Sterling. Hello, everyone. This is Tao Wu, CEO of Autohome, and thank you for joining our earnings conference call today. In the third quarter, we continued to advance our integrated online to off-line ecosystem strategy, focusing on deepening engagement across the entire value chain, while further optimizing our business structure.

On the online front, we are leveraging our new professional content and product mix to strengthen our differentiated competitive advantages, which has led to a steady increase in our traffic scale. In September, our average mobile DAU increased 5.6% year-over-year to exceed RMB 70 million for the first time and scoring our expanding influence among users.

In terms of our off-line offering, we are focused on low-tier markets with the deployment of initiatives like the Hundred Cities, Trade-in for New. In the first 3 months of this year, we successfully organized over 500 offline auto shows providing consumers in this region with a single one-stop service experience that spans from car selection, viewing and test driving to purchase, making the process more convenient than ever.

Additionally, by leveraging the products and services available through our franchise stores we are able to offer a comprehensive and integrated online to off-line solutions that further optimize our customers' business operations, driven by robust growth in our new retail business. Revenues from online marketplace and others increased 3.1% year-over-year during the third quarter.

Mostly, we significantly accelerated the expansion of our new retail business into lower tier cities this quarter. To date, we have a nationwide network of more than 50 stores with Autohome-based stores in mid- to high-tier cities and satellite stores in middle to lower tier cities. The expansion growing scale of our channels only demonstrate the adaptability of our business model across a wider range of cities, but also lays the foundation for the integration of our platform capabilities enable collaboration with partners along the industry value chain and allows us to explore and develop additional initiative business model in the future.

In terms of digitalization, we are leveraging our combined capabilities in data, technology and platforms to continuously enhance the coverage of our digital products. Additionally, we have expanded the application of artificial intelligence technologies across various products to enhance the quality and efficiency of our customers' operations.

Furthermore, our corporation with Ping An Group has reached new heights with the introduction of a series of innovative products and services across our traditional businesses as well as data products, used cars and aftermarket sectors, further strengthening our unique competitive advantages in these areas.

Looking to the future, we will further strengthen our local presence in lower-tier markets to enhance our brand influence while adapting to evolving market dynamics. Our commitment to driving product innovation and broadening our business horizon remains firm as we contribute to the industry's development. At the same time, we will fully leverage Ping An Group's off-line resources and aftermarket service capabilities to amplify synergies and solidify our differentiated competitive advantages. We are confident that these initiatives will enable us to create greater value for the industry and support our long-term sustainable development.

With that, I will now turn the call over to our CFO, Craig Zeng, for a closer look at the third quarter 2024 operating and financial results.

[Yan Zeng, executive]

[Interpreted] Thank you, Mr. Wu. Hello, everyone. I'm Craig Zeng, CFO of Autohome. In the third quarter, we continued to enhance our content and tools by successfully introducing the Autohome AH+ content matrix and a real scenario intelligent evaluation system to create a rich array of high-quality content. Additionally, we launched an industry-leading scenario-based vehicle model library that integrates real-life car use scenario, providing users with a more relevant and practical guide for vehicle selection.

Specifically, our original content metrics now covers more than 13 programs covering 4 key segments, including new cars, car valuations, car culture and the auto industry, we offer authentic and practical information to users through live streaming and video, addressing a wide range of challenges they encounter throughout the entire life cycle of a car ownership. Our intelligent evaluation system focuses on core product features such as advanced driver assistance and smart cockpit, combining professional evaluation capabilities with users real-life scenarios through professional field test, market dimension vehicle reviews and comparisons and live streaming of technical insight we delivered the most critical and relevant smart evaluation results to our users.

On tools, our scenario-based image library covers 3 core leading scenarios, nighttime, spatial and intelligent car viewing. This innovative tools provide users with an intuitive understanding of our vehicles authentic functionality and smart capability, significantly improving the efficiency and convenience of the car selection process. We also upgraded our [indiscernible] benefit platform to aggregate various policies, subsidies and other promotional information in real time, providing users with a one-stop information platform to automatically match and calculate discounts.

Additionally, leveraging our upgraded algorithm under the user and vehicle data we have mined. We have deployed tools such as AIGC and chat box across multiple scenarios, including search, live streaming and instant messaging. They deepen interaction with users, increases the speed and accuracy of response, and improves the overall user experience. According to QuestMobile, the number of our average mobile DAUs grew by 5.6% year-over-year, reaching 72.87 million in September, demonstrating our leading position in the automotive media vertical.

Turning to NEV. Our satellite plan was widely implemented in the third quarter. To date, we've established our safety franchise Autohome Space store and Satellite stores across China, marking the initial scaling of our expansion into lower tier cities. The same lease collaboration between Autohome Space and Satellite stores has facilitated the creation of an efficient network channel. This collaboration encourages resource sharing and offers complementary advantages, providing NEV manufacturers with channel support in cities where they don't have a presence.

The ongoing expansion of our offline service network enables us to provide business and customers with localized and integrated online and off-line solutions, while also tapping into and collecting consumer and needs in the middle to lower tier cities. Going forward, we will further explore the potential of the regional Satellite stores, leveraging our platform advantages to integrate resources throughout the industry value chain and pursue even more innovative business models.

In addition, we also leverage Ping An's unique resources to pilot financial insurance services in the stores. This expands the financial product offering available through Autohome space stores broadens our service scope and diversified revenue stream. For instance, we integrated Ping An's car owner service capabilities to launch a unique industry offering, price guarantee, [indiscernible] package, which provides purchase protection and health care for consumers who purchase cars through our franchise stores. We are pleased to see revenues from NEV brands continue to grow and consistently outpace the industry sales growth rates during the third quarter, increasing 54% compared to the same period last year.

On the digital front, we combined Ping An Group's strength in upsell scenarios and offline service capabilities during the third quarter to launch an outbound core platform and maintenance assistance for upsell services as well as digital services for vehicle tracking. The former enables maintenance possibility to reduce customer acquisition costs and improve in division and return with efficiency, while the latter utilizes finance offline team to provide one-on-one consulting services to customers for treating vehicles across multiple scenarios. This effectively improves transaction conversion rates and has generated positive impact from the market. During the first 9 months of this year, revenue from data products increased by 8% year-over-year.

For used car business, we've effectively integrated the resources of Autohome and Ping An Group to strengthen the synergies with TTP. For example, leveraging our franchise stores and Ping An's off-line team, we've increased the supply of vehicles for auction from 4S dealerships for TTP. At the same time, the Ping An Group's and Autohome's used car teams have assisted TTP in expanding its merchant buyer base nationwide, driving demand across regional car purchases. This initiative has effectively increased transaction volumes and prices and enabled TTP to expand its business, while carefully managing costs.

Overall, our businesses made steady progress in the third quarter. Our innovative businesses laid out earlier, have proven effective as we continuously optimize and expand the theoretical applications. This achievement drove the growth of the online marketplace and others revenue this quarter, as we deepen our cooperation with Ping An Group. We are gradually rolling out additional unique products across various business scenarios. At the same time, we are actively enhancing shareholder returns through dividends and stock repurchases. Looking ahead, we remain committed to optimizing operational efficiency to support our long-term high-quality development.

Next, let me briefly walk you through the key financials for the third quarter of 2024. Please note that as with prior calls, I will reference RMB only in my discussion today, unless otherwise stated. Net revenues for the third quarter were RMB 1.77 billion. Breaking it down, Media Services revenues were RMB 326 million. Leads generation services revenue were RMB 831 million and Online Marketplace and Others revenue were RMB 618 million, up 3.1% year-over-year.

Cost of revenue in the third quarter was RMB 408 million compared to RMB 374 million in the third quarter of 2023. Gross margin in the third quarter was 77% compared to 80.4% during the same period last year.

Turning to operating expenses. Sales and marketing expenses in the third quarter were RMB 877 million compared to RMB 975 million in the third quarter of 2023. Product and development expenses were RMB 339 million compared to RMB 355 million in the third period of 2023. General and administrative expenses were RMB 137 million compared to RMB 141 million during the same period last year.

Overall, we delivered an operating profit of RMB 83 million in the third quarter compared to RMB 166 million for the same period of 2023. Adjusted net income attributable to Autohome was RMB 497 million in the third quarter compared to RMB 604 million in the corresponding period of last year.

Non-GAAP basic and diluted earnings per share in the third quarter were RMB 1.02 compared to RMB 1.23 in the corresponding period of 2023. Non-GAAP basic and diluted earnings for ADS in the third quarter were RMB 4.09 and RMB 4.08, respectively, compared to RMB 4.93 and RMB 4.92, respectively in the corresponding period of 2023.

As of September 30, 2024, our balance sheet remains very strong with cash, cash equivalents and short-term investments of RMB 23.06 billion. We generated net operating cash flow of RMB 209 million in the third quarter of 2024.

On September 4, 2024, our Board of Directors authorized a new share repurchase program under which we were permitted to repurchase up to USD 200 million of Autohome's ADS for a period not to exceed 12 months thereafter. As of November 1, 2024, we repurchased approximately 244,000 ADS for a total cost of approximately USD 6.7 million.

In addition, in accordance with our dividend policy, our Board of Directors has approved a cash dividend of USD 1.15 per ADS or USD 0.2875 per ordinary share payable in the U.S. dollars to holders of ADS and ordinary shareholders of record as of the close of business on December 31, 2024. This aggregate amount of the dividend will be approximately RMB 1 billion and is expected to be paid to holders of ordinary shares and ADS of the company on or around March 14, 2025 and March 19, 2025, respectively. This reflects our strong confidence in our business and future developments as well as our strong commitment to maximizing shareholder returns.

The above is our financial summary. With that we are ready to open up the Q&A session. Operator, please.

[Operator]

[Operator Instructions] We will now take our first question from the line of Thomas Chong from Jefferies.

[Thomas Chong, analyst]

[Interpreted] I'd like to ask about the ongoing price war and the trade-in program. What are the impacts to the industry and Autohome?

[Tao Wu, executive]

[Interpreted] Okay. Thank you for raising the question. We see that with major car companies fighting price war to grab the market share, which has lasted for more than 1.5 years now. According to our observation, this trend has eased slightly recently, but there is no sign of ending in the short term. However, the ongoing price war did not bring the explosion of the car sales growth. According to the latest data from CPCA, retail sales increased by only 2.2% year-on-year from January to September. The price war has also quickly hurt the profitability of the car companies.

From January to September, we see that the average profit margin of the auto industry was only 4.6%, much lower than the average level of the industrial enterprise profit margin of 6.1% in the same period. Meanwhile, dealers are facing tremendous operating pressure due to ongoing price war. According to China Automobile Dealers Association, survey report on the survival of the dealers in the first half of 2024, less than 30% of the auto dealers accomplished their sales target in the first half of the year, and a large proportion of them reached their sales target by exchanging price for volume. In addition, the proportion of dealers operating under loss reached 50.8%, expanding significantly compared with the same period of last year, and the average total gross profit of a single store also had a large drop, especially in the new car business with an average single-store loss of RMB 1.78 million.

Generally speaking, the price war in the auto market has caused the car enterprises and dealers to suffer more seriously negative impact. Under such circumstances, China has introduced the policy of trade-in and also upgraded the vehicle scrapping to help release the consumption potential in an orderly manner and to promote the common development of both supply and demand side. From the data disclosed by CPCA under the simulation of the policy, the auto market has been picking up recently. The domestic retail penetration of NEV has exceeded 50% for 3 consecutive months. The retail sales of new energy vehicles in September increased by 10.6% from the previous month and the wholesale of overall passenger vehicle hit a new record time for the same month. which helped to restore confidence in the auto industry.

The price war that lasted from last year to now has resulted in a serious decline of profit of the automakers and traction in the marketing budget of the OEMs. And we have also been affected by the industry to a certain extent. However, in the long run, with the price war gradually slowing down, the continued development of the NEV industry as well as the government's introduction of the new favorable policy to support consumption, we believe that auto market will have good potential for future growth in the long run, and we are also optimistic about the longer-term development of China's auto industry, and we will also be developing in a sound manner together with China's auto industry. Thank you.

[Operator]

Our next question comes from the line of Xiaodan Zhang from CICC.

[Xiaodan Zhang, analyst]

[Interpreted] My first question is on the new retail model of NEVs. So could you please update us on the progress of the satellite plan? And how should we think of the expansion pace for next year? And secondly, could you please give us more color on how we are going to look for more business synergies between Autohome and Ping An Group?

[Tao Wu, executive]

[Interpreted] Okay. Thank you for raising this question. I'll first take the first question. At present, the Autohome space stores and the satellite stores altogether has already exceeded 50. In terms of the city layout, the space stores mainly cover medium to high tier cities, while satellite stores mainly cover medium to low tier cities. So this kind of 1+N model with the space store and the core well surrounded by the satellite store can make us quickly penetrate into the lower-tier cities with a network service and reaching up quickly to our clients so as to facilitate the OEMs in their channels with uncovered cities.

In terms of the performance of the space stores as well as the satellite stores, we see that it actually facilitate OEM to realize the optimization of their cost efficiency. While at the same time, it also helped the OEMs to lower their channel expansion cost while increasing the sales efficiency. At present, we see that the overall market feedback is very positive. While at the same time, it also generate extra revenue for Autohome. With every increase in penetration of the NEV market, we see that with that good synergy of the space store as well as the satellite store, we can quickly facilitate the upgrading from the new tail network, single point coverage to comprehensive coverage, while at the same time, the NEV brand revenue steadily grow. Well, at the same time, it continued to outperform the overall NEV market, showing very sound market adaptability and competitive edge.

So looking to the future, we are also going to work by both labs. On the one hand, we are going to grow the number of the stores. We are going to make our business model even more sound and robust as to gain more recognition from the OEMs. The existing franchise stores will keep upgrading, including the integration of the industrial chains as well as the in-store financial insurance -- so that actually the franchise store or the business expansion can cover more wide range of the area. So actually, both area. One is to grow the volume. The other thing is to have more explorations and upgrading in the business model.

As for your second question, which is about the synergy between Autohome and Ping An P&C, we see that in the traditional business, for example, we have cohosted the 100 Cities, Trade in for New campaigns, so that we can leverage on the strength of the Ping An off-line team and to reach out to the uncovered cities of Autohome. We also jointly launched more than 500 offline auto shows covering more than 250 cities nationwide, so as to focusing on the lower-tier market to create transaction scenario and to build a differentiated competitive edge.

In terms of the new retail, we also leverage on Ping An's resources and also piloted with our Autohome in-store financial services, including the financial insurance and further expanded the financial product offering while at the same time, we also respond to the trading policy of the national government. So as to integrate our service capabilities to the auto buyers and to provide what I mentioned before the price guarantee heartfelt benefit package so as to bring the one-stop service to the doorstep of the consumers and to provide the car purchase guarantee for the consumers.

As for the data product, we also leverage on the strength of Ping An Group in aftermarket scenario as well as off-line service capabilities. We launched the outbound core platform, the maintenance assistance as well as digital services for the trading vehicles. We also take good use of the offline team of Ping An so as to provide one-on-one consulting services for the trading car users and multiple scenarios so as to effectively promote conversion.

In terms of the used car business, Autohome has integrated the resources with Ping An Group to strengthen the synergy of TTP. For example, the Ping An auto loan agent facilitated TTP to increase the vehicle sources from 4S dealership and Ping An leasing team also helped the TTP to increase the cooperation with the merchant. All of this measures effectively increased the transaction volume and also enabling TTP to enhance their service capabilities for further business expansion.

So generally speaking, we will actually leverage on both online as well as off-line strength of Ping An Group. We will also explore more business models so as to expand the possibilities of our service deliveries.

[Operator]

Our next question comes from Ritchie Sun from HSBC.

[Ritchie Sun, analyst]

[Interpreted] First of all, what is management's view on 2025 used car market? And how does management view the goal for [indiscernible] next year? Second, what has management -- what has Autohome made in terms of shareholder return progress? And what is the plan for the future? .

[Tao Wu, executive]

[Interpreted] Okay. Thank you for raising this question. Let me first take the first question. Like I said before, based on the more than 1-year price war of the new car market, it do actually impose a huge pressure on the used car market. So with continuous downward pressure of the new car price, we see that the users are quite reluctant to make their purchase. As a result, the used car market in China for several consecutive quarters continues to be sluggish. And you can see that the auto dealers, they are not very enthusiastic in their car purchase.

Even though there are policy updates such as scrappage, however, as well as what you have observed from January to September of 2024, the cumulative trading volume of the used car only increased by 5.37%, which has greatly declined comparing with the same period of last year. Even though there are policy preferences, we do see that profitability of the automakers are not very good. We can see that the single car trading is still in losses. And we see that in September, the used car trading average price is only RMB 54,200, which is a drop of RMB 1,200 versus the same period of last year, and the strongest demand comes from the price range of RMB 50,000 to RMB 100,000. The profit margin of the auto dealers are greatly squeezed and their profitability cannot improve.

So talking about the future, we see that actually for TTP, you can see that a lot of the car vehicle sources are actually rushing into the 4S dealership stores because next year, we expect that the new car price war will not end immediately, there will still be a big challenge for the used vehicle. So for TTP, actually, our previous strength is with the C2B aftermarket. But now we see that there will be more opportunities on the B2B market. So besides the previous strength on C2B, we're going to make more breakthroughs and transformation in the B2B market as to tap into the potential in the B2B sector.

As for your second question, which is about the shareholders' return, we see that Autohome has always been very dedicated to increasing the return to our shareholders. Like we said before, last year, we actually announced a shareholders' return plan for about RMB 1.5 billion, and we just announced an actual RMB 1 billion dividend payout. As a result, altogether, there will be RMB 1.5 billion dividend payout to our shareholders. And our Board also, actually in September, adopted USD 200 million share buyback plan. We also have adopted many measures to reduce the volatility of the share price. So we think that currently, we have been using dividend payout as well as shares repurchased to enhance the return to our shareholders by taking the lead in this area. So looking into the future, we will continue to look into the other possibilities so as to enhance the chance to increase the shareholders' return.

[Operator]

Our next question comes from the line of Brian Gong from Citi.

[Brian Gong, analyst]

[Interpreted] The management just mentioned about price war, which continues for the auto industry. So on this background, how does management think about OEMs as for the fourth quarter and for next year? And second question is about contract renew with dealers. And what's the biggest progress? And how does management think about the overall contract renew for this one?

[Tao Wu, executive]

Okay. Thank you for raising this question. The first one is about the OEM advertising budget as well as the outlook for the next year. We are already approaching Q4, which is actually the end of the year, and we see actually the sales performance of the OEMs also coming to the end. For those who are expected to keep the sales target, they will actually promote their terminals sales or directly subsidize consumers with their budgets so as to incentivize the transaction. But for those less well behaving or performing OEMs, they will actually cut their advertising budget. So generally speaking, the OEMs, they are very precautious about their advertising strategy. And we think that looking into next year, they will more reasonably balance their advertising budgeting as well as the price war subsidies. Next year this might get better, but it still depends. We will still see how they will perform after next year.

As for the contract renew for the lead subscription package, actually, this will initiate at the end of the year and will last on to the first quarter of next year. From historical data, you can see that the contract renew of Autohome for lead subscription package has always been very stable. And present, Autohome has already covered most majority of the dealers on the market. which also shows the overall recognition of the dealers to our service as well as their reliance on our service.

As one of our core service you can see that Autohome will continue to leverage on big data technology as well as better service quality so as to further empower the dealers and to further enhance the precision of the matchmaking, as well as the efficiency of the conversion. Well, at the same time, this year, we'll also continue to cooperate with Ping An Group to further provide more diversified instruments for our dealers so as to facilitate them to cope with the fierce market competition as well as the challenge on the profit margin. In terms of the progress of the contract renew, we will keep you updated about the latest progress.

[Operator]

There are no further questions at this time. I'll turn the conference back to the management for closing comments.

[Tao Wu, executive]

[Interpreted] Thank you very much for joining us today. We appreciate your support and look forward to updating you on our next quarter conference call in a few months' time. In the meantime, please feel free to contact us if you have any further questions or comments. Thank you very much, everyone. Thank you. Bye-bye. .

[Operator]

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.

[Portions of this transcript that are marked [Interpreted] were spoken by an interpreter present on the live call.]