VNET Group, Inc. Q2 FY2020 Earnings Call

· Earnings call transcript and AI-powered summary

Quarter Overview

  • Revenue reached RMB 1.14 billion, up 28.8% year-over-year (vs. RMB 888 million in Q2 2019).
  • Adjusted EBITDA was RMB 306.4 million, up 17.5% year-over-year (vs. RMB 260.7 million).
  • Adjusted EBITDA margin declined to 26.8% from 29.4% in Q2 2019 due to additional capacity delivery.
  • Net loss attributable to ordinary shareholders widened to RMB 2.12 billion (vs. RMB 102.1 million), primarily due to non-cash fair value changes in convertible notes and deemed distribution from preferred shares.

Operational Highlights

  • Added 4,404 new cabinets in Q2, including over 2,000 acquired wholesale cabinets in Shanghai.
  • Total cabinets operated and managed: 44,050 as of June 30, 2020.
  • Utilization rate improved to 61.4% from 60.4% in Q1 2020.
    • Mature IDC utilization rose to 73.6% (vs. 72.3% in Q1 2020).
    • Newly built/ramp-up IDC utilization jumped to 30.1% (vs. 12.3% in Q1 2020).
  • Retail IDC MRR per cabinet grew to RMB 8,953 from RMB 8,663 in Q2 2019.

Strategic and Expansion Updates

  • Delivered approx. 2,400 self-built cabinets to major wholesale customers in Jiangsu.
  • Total signed wholesale MoUs reached over 130MW by end of June 2020 (vs. 90MW in Q1 2020).

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Operator: Good morning and good evening, ladies and gentlemen. Thank you, and welcome to the 21Vianet Group's Second Quarter 2020 Earnings Conference Call. With us today are Mr. Alvin Wang, Chief Executive Officer and President; Ms. Sharon Liu, Chief Financial Officer; and Ms. Rene Jiang, Investor Relations Director of the Company. I'll now turn the call over to your first speaker today, Ms. Rene Jiang, IR Director of 21Vianet. Please go ahead, ma'am. Rene Jiang: Thank you, operator. Hello, everyone. Welcome to our second quarter 2020 earnings call. Before we start, please note that this call may contain forward-looking statements made pursuant to the safe harbor provisions for the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management's current expectations and observations that involve known and unknown risks, uncertainties and other factors not under the Company's control, which may cause actual results, performance or achievements of the Company to be materially different from the results, performance or expectations implied by these forward-looking statements. All forward-looking statements are expressly qualified in their entirety by the cautionary statements, risk factors and details of the Company's filings with the SEC. 21Vianet undertakes no duty to revise or update any forward-looking statements for selected events or circumstances after the date of this conference call. I will now turn the call over to Mr. Alvin

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