NA

Thank you for standing by, and welcome to the Nano Labs Ltd Second Half 2025 Earnings Conference Call. All participants are in a listen-only mode. There will be a presentation followed by a question and answer session. If you wish to ask a question, you will need to press the star key followed by the number one on your telephone keypad. I would now like to hand the conference over to Mr. Kong, CEO of the company. Please go ahead. Mr. Kong, you can now begin your presentation.

[Non-English content]

Thank you, operator, and everyone for joining Nano Labs second half of 2025 earnings conference call today. On our call today, I will provide an overview of our recent development and our strategic initiatives going forward.

[Non-English content]

In 2025, the Web3 industry experienced a robust growth with the continuous improvement of the global crypto market environment, including enhanced crypto assets, infrastructure, and increasing market participation. The crypto market and Web3-related sectors entered a new phase of growth and opportunity.

[Non-English content]

Following a comprehensive and prudent internal assessment of the strategic value and long-term perspectives of BNB, we initiated and continued to advance the build out of our BNB reserves. As of December 31st, 2025, the company held a total of 126,662 BNBs, along with a receivable collateral of 3,338 BNB. By steadily increasing our BNB holdings, we have optimized our crypto asset allocation and created favorable conditions for the future business expansion and ecosystem collaboration.

[Non-English content]

In terms of Capital operations, we successfully completed two rounds of financing in 2025, providing strong support for our strategic transformation, expansion of our crypto asset reserves, and the explorations of new business directions.

[Non-English content]

In March 2026, we officially launched our next generation product, the iPollo ClawPC A1 Mini, designed to support the Open Claw AI Agent. Going forward, we plan to introduce the Cloud OS system and additional hardware products to further expand our full ecosystem services for AI agents. Meanwhile, to enhance shareholder value and demonstrate management's confidence in the company's long term development, we announced a share repurchase program of up to $25 million in October 2025. The program has commenced and is expected to be implemented steadily over the long term. Looking ahead, we will continue to closely monitor industry trends and market dynamics. While maintaining stable operations, we will further advance our crypto asset strategy, strategic reserves, and actively explore broader opportunities with the AI agent ecosystem.

[Non-English content]

Thank you for your support and trust. Next, I will turn the call over to our Chief Financial Officer, Mr. Chen, for a closer review of our financial results. Mr. Chen, please go ahead.

[Non-English content]

Thank you, Mr. Kong. Good morning everyone, on behalf of the management team, I will provide a brief financial overview of the second half of 2025. In the second half of 2025, our net revenue was RMB 80.7 million, equal to $2.7 million, compared to RMB 50.9 million in the same period last year, increased of 18.1%. This increase was primarily due to the increase in sales volume of the iPollo V series products. We recorded a gross loss of RMB 29.1 million, equal to $4.1 million for the second half of 2025. Compared to a gross profit of RMB 11.6 million in the same period of 2024. Cost of revenue for the second half of fiscal year 2025 were RMB 47.8 million, equals to $6.8 million, compared to RMB 4.3 million in the same period of 2024. The decline was mainly due to the write-downs of inventories and value-added tax recoverable.

[Non-English content]

Total operating income for the second half of fiscal year 2025 increased by 233.9% to RMB 89.9 million, equals to $12.8 million, increased from RMB 67.1 million in the same period of 2024. Selling and marketing expenses dropped by 56.2% to RMB 2.1 million, equals to $0.3 million, compared to RMB 4.8 million in the same period of 2024. This decrease was mainly due to the decrease in employee salary expenses.

[Non-English content]

General and administrative expenses increased by 30.3% to CNY 33.1 million, equal to $4.7 million for the second half of 2025 from CNY 25.4 million for the same period of 2024. The increase in general and administrative expenses was primarily due to the increase in professional service fees.

[Non-English content]

Research and development expenses decreased by 76.9% to RMB 4.9 million, equals to $0.7 million for the second half of 2025 from RMB 21.2 million for the same period of 2024. The decrease in research and development expenses was primarily due to the decrease in salary expenses, material fees, and equipment fees.

[Non-English content]

Profit from operations was RMB 60.8 million, equals to $8.7 million for the second half of 2025, compared with loss from operations of RMB 55.6 million for the same period of 2024. Other income was RMB 38.2 million, equals to $5.4 million for the second half of 2025, compared to RMB 1.7 million for the same period of 2024. The change was due to the Binance Launchpool and the airdrop income for BNB holders and income for crypto investment products. Net income was RMB 137.7 million, equals to $19.6 million for the second half of 2025, compared to a net loss of RMB 60.4 million in the same period of 2024.

Basic and diluted earnings per share was RMB 6.2, equals to $0.9 for the second half of 2025, compared to basic and diluted loss per share of RMB 6 in the same period of 2024. As of December 31st, 2025, the company had a cash and cash equivalent of RMB 8.5 million, equals to $1.2 million, compared with RMB 328.4 million as of December 31, 2024.

[Non-English content]

We remain confident in our business strategy and ability to execute it. We will continue to leverage the strength of our technology to capture development opportunities, drive long-term growth, and create additional value for our shareholders. Now I would like to turn the call over to the operator for questions and answers session.

Thank you. If you wish to ask a question, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two. If you are on a speakerphone, please pick up your handset to ask your question. The first question today comes from Irina Rubano a Private Investor. Please go ahead.

Hi, thank you for the presentation. My question is, what is the company's long-term strategic plan regarding its BNB holdings?

[Non-English content]

[Non-English content]

After comprehensively evaluating the development trends of crypto assets and the long-term potential of BNB, our company has designated BNB as a core component of its crypto asset strategic reserves. Over the long term, we plan to continue holding BNB and to gradually increase our holding at appropriate times, maintaining a relatively stable reserve level. This strategy is expected to enhance the company's crypto asset allocation capabilities while strengthening synergies with the Web3 ecosystem, thereby providing a solid asset foundation for the company's long-term strategic development.

Okay, thank you.

Next question comes from Alfred Wu, a Private Investor. Please go ahead. Alfred, your line is open. You may ask your question. Perhaps your line is muted, Alfred. Please ask your question. We appear to have lost connection with Alfred. The next question comes from Claire Harrison, a private investor. Please go ahead.

Okay. Thank you, management. I have some questions. My first question is, why did the company launch a share repurchase program?

[Non-English content]

[Non-English content]

Thank you. In October 2025, we announced a share repurchase program of up to $25 million based on the following considerations. First, to enhance shareholder value and deliver long term returns. Second, to demonstrate management's positive outlook on the company's long term development. Third, to signal confidence in the company's long term growth and operations to the capital markets. The company will implement the repurchase program in a steady and disciplined manner over time, taking into account market conditions and capital allocation plans. Thank you.

Thank you. My second question, what was the rationale behind the launch of the iPollo ClawPC A1 Mini product?

[Non-English content]

[Non-English content]

Thank you. As you may know, one of the most prominent concepts in the AI space today is Open Claw. The iPollo ClawPC A1 Mini is the company's next generation AI agent hardware product designed to support the Open Claw AI agent system. We believe that AI agents are likely to become a key form of next generation intelligent applications, and have therefore chosen to proactively invest in the related infrastructure. Our company has already gained significant brand visibility in the market with the product sales and ecosystem development progressing steadily. Going forward, we plan to launch the Cloud OS system and additional agent hardware products to support a full-chain AI agent ecosystem. Thank you.

The next question comes from Ella Rosenblatt, a Private Investor. Please go ahead.

Hi management team, thank you for your presentation. My question is, what are the company's key long term business development directions?

[Non-English content]

[Non-English content]

Our company's future business development will focus on two primary directions. First, crypto asset reserve strategy, continuing to advance its BNB-centered crypto asset reserve strategy and steadily expanding asset allocation when market conditions are favorable. Second, AI agent ecosystem development, advancing the launch and the commercialization of hardware products such as the iPollo ClawPC, introducing the Cloud OS system, and building an AI agent application and service ecosystem to capture opportunities arising from the transition from Web3 to Web4 Thank you for your question. Please go ahead.

That concludes the question and answer session. Let me turn the call back over to Bing Chen for closing remarks.

[Non-English content]

Thank you very much for joining this conference call. If you have any questions, please contact us through emails at [email protected] or reach our IR consultant Ascent Investor Relations at [email protected]. Management will respond to your questions as soon as possible. We appreciate your interest and support in Nano Labs and look forward to speaking with you again next time.

Thank you again for attending Nano Labs' second half of 2025 earnings conference call. This concludes our call today, and we thank you all for your listening in. Goodbye.

Ladies and gentlemen, thank you for standing by. Welcome to Nano Labs Ltd's First Half of 2025 Earnings Conference Call. During today's call, all participants will be in listen-only mode. This conference is being recorded today, Friday, August 15, 2025. Joining us today from Nano Labs Ltd are the company's Chairman and Chief Executive Officer, Mr. Jianping Kong, and the company's Chief Financial Officer, Mr. Bing Chen. On our call today, Mr. Jianping Kong will give you an overview of the company's performance. Mr. Bing Chen will share the details of the company's financial results. After that, we will conduct a question and answer session to take your questions. Before we continue, I would like to remind you that some information discussed on this call will contain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 as amended and as defined in The US Private Securities Litigation Reform Act of 1995. Such statements are based upon management's current expectations and current market 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, or factors is included in the company's filings with the Securities and Exchange Commission. During today's call, Mr. Jianping Kong and Mr. Bing Chen will deliver their remarks in Chinese, and the company's representatives will provide corresponding English translations. With that, I will now turn the call over to Mr. Jianping Kong, the company's Chairman and Chief Executive Officer. Mr. Jianping Kong, please go ahead.

Hello. Thank you, operator, and everyone for joining Nano Labs Ltd's first half of 2025 earnings conference call today. On our call today, I will provide an overview of our recent development and our initiatives in the future. The year 2025 marks a major transformation for the company in light of the evolving industry landscape and the onset of a new market cycle. We focus our resources and efforts on expanding our work with strategic reserves as the market continues to embrace cryptocurrency transactions and cryptocurrency reserves. We have taken the decisive first step of concentrating our cryptocurrency reserve in BNB, ushering in a new stage of development. As of the date of this earnings conference call, the company holds over 128,000 BNB. Meanwhile, building on our existing mining machine business, we continue to explore new market opportunities while maintaining stability in our current operations. Reviewing 2025, we have undertaken this decisive and strategic transformation since the beginning of this year. We accelerated our expansion and collaboration in the cryptocurrency field. Meanwhile, we undertook ambitious yet prudent initiatives to set up currency investments and reserves through various approaches, including the continuous expansion of our strategic cryptocurrency reserve using both financing and proprietary funds, as well as a strategic equity investment in CEA, a BNB reserve company, thereby solidifying our BNB strategic reserve layout. At the same time, we expanded into the emerging stablecoin sectors as part of our diversified Web3 strategy. Looking forward, we remain vigilant for emerging opportunities and the vast potential for innovation in the laboratory space and the AI-driven transformative era. Through visionary and insightful strategic planning, along with decisive and consistent execution, we believe these efforts will generate substantial value for our stakeholders and drive long-term prosperity for the company. Thank you for your support and trust. Next, I will turn the call over to our Chief Financial Officer, Mr. Bing Chen, for a closer review of our financial results. Mr. Bing Chen, please go ahead.

Thank you, Jianping Kong. Good morning, everyone. On behalf of the management team, I will provide a brief financial overview of 2025. In 2025, our net revenue was RMB 8,280,000, approximately USD 1,160,000, compared to RMB 24,740,000 in the same period last year. The decline was primarily due to the decreased sales volume of the Apollo V series product. We recorded a gross loss of RMB 10,710,000, approximately USD 1,500,000 for 2025, compared to a gross profit of RMB 30,000 in the same period of 2024. Cost of revenue for 2025 was RMB 18,990,000, approximately USD 2,650,000, compared to RMB 24,710,000 in the same period of 2024. The decline was mainly due to the decrease in sales volume and write-down of inventory and value-added tax recoverable. Total operating expenses for 2025 decreased by 53.5% to RMB 27.33 million, approximately USD 3,820,000, down from RMB 58,720,000 in the same period of 2024. Selling and marketing expenses dropped by 39.6% to RMB 2,620,000, approximately USD 370,000, compared to RMB 4,330,000 in the same period of 2024. This decrease was mainly due to the decrease in sales commission and salaries. General and administrative expenses decreased by 15.4% to RMB 21,540,000, approximately USD 3,010,000 for 2025, from RMB 25,450,000 for the same period of 2024. The decrease in general and administrative expenses was primarily due to the decrease in professional fees and employee salary expenses. Research and development expenses decreased by 89.1% to RMB 3.2 million, approximately USD 440,000 for 2025, from RMB 28,930,000 for the same period of 2024. The decrease in research and development expenses, including salary expenses, design fees, service fees, material costs, etc., was mainly due to the strategic adjustment in research and development activities in 2025. Loss from operations was RMB 38,030,000, approximately USD 5.31 million for 2025, compared with a loss from operations of RMB 58,690,000 for the same period of 2024. Net loss was RMB 11,780,000, approximately USD 1,650,000 for 2025, compared to a net loss of RMB 59,150,000 in the same period of 2024. Basic and diluted loss per share was RMB 0.43, approximately USD 0.06 for 2025, compared to basic and diluted loss per share of RMB 8.46 in the same period of 2024. As of June 30, 2025, the company had cash and cash equivalents of RMB 3.06 million, approximately USD 50,770,000, compared with RMB 32,430,000 as of December 31, 2024. We remain confident in our business strategies and ability to execute them. We will continue to leverage the strengths of our technology to capture development opportunities, drive long-term growth, and create additional value for our shareholders. Now I would like to turn the call over to the operator for the question and answer session.

Thank you. If you wish to ask a question, please press 1 on your telephone and wait for your name to be announced. If you wish to cancel your request, please press 2. If you are on a speakerphone, please pick up the handset to ask your question. Your first question comes from Claire Harrison. Please go ahead.

Thank you, management team. My question is why has the company chosen BNB as its core reserve asset? Thank you.

BNB, as one of the most representative crypto assets, not only has a highly active ecosystem but also demonstrates outstanding long-term growth potential and resilience, supported by its model and platform value. Therefore, we hold BNB as a key cryptocurrency for our core strategic objective. Thanks.

Your next question comes from Armstrong Wu.

Hello. My question is, regarding your focus on BNB, what parameters will the company take to strengthen its strategy with reserves? Thank you.

We will adopt diversified approaches to advance our BNB strategic reserve plan, including acquiring, controlling, or minority stakes in BNB strategic reserve companies, as well as investing in enterprises with strong ecosystem synergies. These diversified measures will help us build a more stable strategic layout. Thanks.

Your next question comes from Ella Rosenblatt.

Hi. My question is will the company consider reserving other cryptocurrencies, or will it focus solely on BNB?

Currently, the company is focused on BNB as its core reserve asset based on a comprehensive assessment of BNB's ecosystem maturity, asset stability, and long-term growth potential. However, we will continue to monitor other crypto assets with strategic value and ecosystem support. In the future, we do not rule out allocating a small portion of diversified assets at the right time and in well-defined scenarios to optimize our portfolio and enhance resilience against market cycles. Overall, though, our company will remain centered on BNB to maintain strategic focus and expansion strategy. Thanks.

Your next question comes from Irina Ravana.

Hi, thank you. Does the company have any financing plans for 2025, and what are the considerations behind such plans?

Of course, for that one, we are focused on the company's initiatives and partially concrete strategy financing in 2025. The primary purpose of this financing is to support the continued expansion of our BNB strategic reserve scale. Going forward, we will continue to consider various financing options to further support the growth of our BNB strategy with sales plans, thereby ensuring better execution of our Web3-related business initiatives. Thank you.

And that concludes the question and answer session. Let me turn the call over to Mr. Bing Chen for closing remarks.

Thank you very much for joining this conference call. If you have any questions, please contact us through email at ir.nano.cn or reach our IR counsel at [email protected]. Management will respond to your questions as soon as possible. We appreciate your interest and support in Nano Labs Ltd and look forward to speaking with you again next time. Thank you.

Again, thank you for attending Nano Labs Ltd's first half of 2025 earnings conference call. This concludes our call for today, and we thank you all for listening in. Goodbye.

Goodbye.

Ladies and gentlemen, thank you for standing by. Welcome to Nano Labs Second Half of 2024 Earnings Conference Call. During today's call, all participants will be in listen-only mode. This conference is being recorded today, Tuesday, March 25th, 2025. Joining us today from Nano Labs are the company's Chairman and Chief Executive Officer, Mr. Jianping Kong; and the company's Chief Financial Officer, Mr. Bing Chen. On our call today, Mr. Kong will give you an overview of the company's performance. Mr. Chen will share the details of the company's financial results. After that, we will conduct a question-and-answer session to take your questions. Before we continue, I would like to remind you that some of the information discussed on this call will contain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended and as defined in the U.S. Private Securities Litigation Reform Act of 1995. Such statements are based upon management's current expectations and current market 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 and uncertainties and other factors is included in the company's filing with the Securities and Exchange Commission. During today's call, Mr. Kong and Mr. Chen will deliver their remarks in Chinese, and the company's representative will provide corresponding English translations. With that, I will now turn the call over to Mr. Kong, the company's Chairman and Chief Executive Officer. Mr. Kong, please go ahead.

[Foreign Language] [interpreted] Thank you, operator, and everyone for joining Nano Labs second half of 2024 earnings conference call today. In our call today, I will provide an overview of our recent development and our strategic initiatives in the future. The year 2024 represents numerous opportunities as the company continues to expand its business. As demand for digital currency transactions and cryptocurrency adoption continue to rise, we have officially established the Bitcoin value investment as a new business sector and designated Bitcoin as our primary reserve asset. As of the date of this earnings conference call, the company holds about 400 BTC with a total purchase price of around $40 million. Additionally, in December 2024, we launched an upgraded complete machine equipped with a Cuckoo 3.0 iteration chip, which delivers enhanced performance that meets all leading standards. This significant improvement provided us with a key competitive advantages to further expand our market share. With the rapid evolution of AI, we plan to develop AI applications with the Web3.0 ecosystem, focusing on integration of AI and the Web3.0 technologies. Through visionary and insightful strategic planning and consistent excursion, we remain committed to deepening our expertise in the Web3.0 space. We believe these efforts will create substantial value and drive strong results for our stakeholders. Thank you for your support and trust. Next, I will turn the call over to our Chief Financial Officer, Mr. Chen, for a closer review of our financial results. Mr. Chen, please go ahead.

[Foreign Language] [interpreted] Thank you, Mr. Kong. Good morning, everyone. On behalf of the management team, I will provide a brief financial overview of the second half of 2024. In the second half of 2024, our net revenue was RMB15.86 million, $2.21 million compared to RMB26.07 million in the same period last year. This decline was primarily due to the decrease in sales volume of iPollo V Series product. However, we recorded a gross profit of RMB11.57 million, $1.6 1 million for the second half of 2024 compared to a gross loss of RMB40.55 million in the same period of 2023. Cost of revenue for the second half of fiscal year 2024 were RMB4.28 million, $0.6 million compared to RMB66.62 million in the same period of 2023. The decline was mainly due to the decrease in sales volume and last inventory write down recorded. Total operating expenses for the second half of fiscal year 2024 decreased by 38.7% to RMB51.39 million, $7.15 million, down from RMB83.84 million in the same period of 2023. Selling and marketing expenses dropped by 17.7% to RMB4.8 million, $0.67 million compared to RMB5.83 million in the same period of 2023. This decrease was mainly due to the decrease in employee salary expenses. General and administrative expenses increased by 30.5% to RMB25.38 million, $3.83 million for the second half of 2024 from RMB22.38 million for the same period of 2023. The decrease in general and administrative expenses was primarily due to the increase in depreciation expenses. Research and development expenses decreased by 61.9% to RMB28.93 million, $4.06 million for the second half of 2024 from RMB32.97 million for the same period of 2023. The decrease in research and development expenses was primarily due to the decrease in salary expenses, material fees and equipment fees. Loss from operations was RMB39.82 million, $5.54 million for the second half of 2024 compared with loss from operations of RMB124.4 million for the same period of 2023. Net loss was RMB60.39 million, $8.4 million for the second half of 2024 compared to a net loss of RMB120 million in the same period of 2023. Basic and diluted loss per share was RMB6.01, $0.84 for the second half of 2024 compared to basic and diluted loss per share of RMB19.12 in the same period of 2023. As of December 31, 2024, the company had cash and cash equivalents of RMB32.43 million, $4.51 million compared with RMB48.16 million as of December 31, 2023. We remain confident in our business strategy and ability to execute it. We will continue to leverage the strength of our technology to capture development opportunities, drive long term growth and create additional value for our shareholders. Now, I would like to turn the call over to the operator for questions-and-answer season.

Thank you. [Operator Instructions] Your first question comes from [Claire Harrison] (ph), a Private Investor.

Hi. Thank you, Mr. Kong and Mr. Chen. So why is the company consider to increase its holdings of Bitcoin? Thank you.

[Foreign Language] [interpreted] We believe Bitcoin is a strategic asset with long term value for reserves and plays a crucial role in the Web3.0 ecosystem. Additionally, its limited supply makes it a potential [indiscernible] against inflation with significant room for appreciation over time. More importantly, Bitcoin can serve as foundational infrastructure, creating opportunities for Web3.0 development. Furthermore, many countries have officially recognized Bitcoin as a national strategic reserve asset. We're imposing our confidence in its long term value and potential.

Your next question comes from [Alfred Wu] (ph), a Private Investor.

Hello. My question is, what considerations have driven the company's recent financing activities? Thank you.

[Foreign Language] [interpreted] Our recent financing activities were driven by business adjustments and expansion initiatives, particularly over increased investment in Bitcoin as a strategic asset. During discussions with strategic investors, we found strong alignment between their industry outlook and our long term vision. Recognizing this synergy, we see the opportunity to introduce these investors at the right time and successfully secure financing.

Your next question comes from [Stephanie Bell] (ph), a Private Investor.

Hi, Mr. Kong and Mr. Chen. My question is, what is the company's plan for future development? Thank you.

[Foreign Language] [interpreted] Historically, our business has primarily focused on chip technology expanding into metaverse computing and ecological applications. Looking ahead, we see massive opportunities within the broader metaverse ecosystem and will continue exploring emerging market opportunities. We will start from the design of cryptocurrency IC chips and we will be committed to the development of AI plus Web3.0 in the future.

Your next question comes from [Eva Hoffman] (ph), a Private Investor.

Thank you, management team. My question is, the company's income is not significant at present. Do you have any expectation for the future? Thank you.

[Foreign Language] [interpreted] Our Cuckoo 3.0 equipped machines are being steadily shipped and their impact will be reflected to some extent in this year's business performance. Our current focus is on optimizing product management and operations, while staying prepared to seize emerging market opportunities as they arise. And that concludes the question-and-answer season. Let me turn the call over to Mr. Chen for closing remarks.

[Foreign Language] [interpreted] Thank you very much for joining this conference call. If you have any questions, please contact us through e-mails at [email protected] or reach our IR Consultants Investor Relations at [email protected]. Management will respond to your question as soon as possible. We appreciate your interest and support in Nano Labs and look forward to speaking with you again next time.

Thank you again for attending Nano Labs second half of 2024 earnings conference call. This concludes our call for today and we thank you all for listening in. Goodbye.

Ladies and gentlemen, thank you for standing by. Welcome to Nano Labs First Half of 2024 Earnings Conference Call. [Operator Instructions]. This conference is being recorded today, Wednesday, September 18, 2024. Joining us today from Nano Labs are the company's Chairman and Chief Executive Officer; Mr. Jianping Kong, and the company's Chief Financial Officer, Mr. Bing Chen. On our call today, Mr. Kong will give you an overview of the company's performance. Mr. Chen will share the details of the company's financial results. After that, we will conduct a question-and-answer session to take your questions. Before we continue, I would like to remind you that some information discussed on this call will contain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended and as defined in the U.S. Private Securities Litigation Reform Act of 1995. Such statements are based upon management's current expectations and current market 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 or factors is included in the company's filings with the Securities and Exchange Commission. During today's call, Mr. Kong and Mr. Chen will deliver their remarks in Chinese, and the company's representative will provide corresponding English translation. With that, I will now turn the call over to Mr. Kong, the company's Chairman and Chief Executive Officer. Mr. Kong, please go ahead.

[Foreign Language]. Thank you, operator, and everyone, for joining Nano Labs First Half of 2024 Earnings Conference Call today. On our call today, I will provide an overview of our recent development and our strategic initiatives in the future. [Foreign Language]. The first half of 2024 has clearly witnessed a recovery in the industry and the continuous emergence of new market opportunities. Amid this existing bull market environment, our company has been making substantial investments in the research and development of our upgraded Cuckoo Series products. In May 2024, we successfully commenced the mass production of Cuckoo 3.0 chip, which features significantly enhanced the performance compared to the Cuckoo 2.0 chip, setting a new global benchmark. This key development positions to capitalize on new market opportunities progressively. Moreover, our company plans to launch a range of models equipped with the Cuckoo 3.0 chip for various application scenarios in the remainder of this year and the first half of next year, which is expected to drive significant growth in our sales. [Foreign Language]. Furthermore, we are continuously innovating in packaging technology and IP to improve the efficiency of chip production, the development of promising AI computing, ZK computing and other chips is also on the way. Concurrently, our iPollo Metaverse's photography studio service, a component of our Metaverse business suite is making consistent progress. We have established a profound collaborations with various institutions and organizations, which lays the groundwork for substantial growth potential in the future. We anticipate that through the combined persistence and efforts of the industry and ourselves, we will overcome existing [indiscernible] and unlock new heights of success in the future. [Foreign Language]. Thank you for your support and trust. Next, I will turn the call over to our Chief Financial Officer Mr. Chen for a closer review of our financial results. Mr. Chen, please go ahead.

[Foreign Language]. Thank you, Mr. Kong. Good morning, everyone. On behalf of the management team, I will provide a brief financial overview of the first half of 2024. In the first half of 2024, our net revenue was RMB24.74 million, USD3.47 million compared to RMB52.37 million in the same period last year. This decline was primarily due to the decreased sales of the iPollo V1 Series product. However, revenue from our 3D-printing products showed significant growth, increasing to RMB459,200 from RMB22,000. Cost of revenues for the first half of fiscal year 2024 were RMB24.71 million. USD3.47 million, compared to RMB115.2 million in the same period of 2023. The change was mainly due to the decrease in sales volume and the less inventory write-down recorded. [Foreign Language]. Total operating expenses rate for the first half of fiscal year, 2024 decreased by 20.1% to RMB58.72 million. USD8.24 million, down from RMB73.50 million in the same period of 2023. Selling and marketing expenses dropped by 54.4% to RMB4.33 million, USD0.61 million, compared to RMB9.50 million in the same period of 2023. This decrease was mainly due to reduced sales commissions and product shipping expenses. [Foreign Language]. General and administrative expenses decreased by 18% to RMB25.45 million, USD3.57 million for the first half of 2024 from RMB31.04 million for the same period of 2023. The decrease in general and administrative expenses was primarily due to the decrease in office lease expenses, mainly attributable to the relocation of the head office and the decrease in employee salary expenses as the number and salaries of general and administrative staff decreased. [Foreign Language]. Research and development expenses decreased by 12.2% to RMB28.93 million, USD4.06 million for the first year -- for the first half of 2024. From RMB32.95 million for the same period of 2023. The decrease in research and development expenses was primarily due to the decrease in salary expenses. [Foreign Language]. Loss from operations was RMB58.69 million, USD8.24 million for the first half of 2024, compared with loss from operations of RMB136.4 million for the same period of 2023. Net loss was RMB59.50 million, USD8.30 million for the first half of 2024, compared to a net loss of RMB134.3 million in the same period of 2023. Basic and diluted loss per share was RMB0.85, USD0.12 for the first half of 2024, compared to basic and diluted loss per share of RMB2.41 in the same period of 2023. As of June 30, 2024, the company had cash and cash equivalents of RMB23.51 million, USD3.3 million compared with RMB48.15 million as of December 31 -- as of December 31, 2023. [Foreign Language]. We remain confident in our business strategy and ability to execute it. We will continue to leverage the strength of our technology to capture development opportunity, drive long-term growth and create additional value for our shareholders. Now I would like to turn the call over to the operator for a questions-and-answer session.

[Operator Instructions]. Your first question comes from Oscar Tracey, Private Investor. Please go ahead.

So, I'm just wondering, could you provide some more details about your new 3D products? Thank you.

[Foreign Language]. Our company's newly launched Cuckoo3.0 Chip is an upgraded integration of the original Cuckoo 2. We significantly improved performance. The Cuckoo 3 has reached a leading position globally, machines equipped with [indiscernible] quantities of these chips can be used not only in data center environments, but also independently in-home or consumer set teams, offering flexibility for various user scenarios.

Your next question comes from Arana Rabner a private investor. Please go ahead.

Thank you. What are the company's expectations for the market and financial figures in the second half of this year?

[Foreign Language]. Our company plan to launch our complete mission equipped with Cuckoo 3 chip in the second half of the year, which is expected to drive an increase in sales of [indiscernible] products. Additionally, we are gradually introducing new product lines to the market, and we anticipate the sales volume to go over time.

Your next question comes from Clara Walton, Private Investor. Please go ahead.

I have a question. What sort of competitivity advantage of the reasons, last Cuckoo 3.0, as they have relevant to the recent AI trends? Thank you.

[Foreign Language]. The Cuckoo 3.0 Chip offers the highest computing power and the lowest power efficiency among our current products. Our company has developed multiple models to cater to different application scenarios regarding AI, the Cuckoo 3 features are high-bandwidth multichannel, 3D DRAM with dedicated distributed on-chip network to enable efficient data exchange between computing and storage units, which is a key technology in AI chips. Additionally, the chief specialized low-voltage circuit designed to reduce power consumption aligned with corresponding timing sign of processes provide a comparative advantage for AI chip design.

The next question comes from Armstrong Wu, Private Investor. Please go ahead.

Thank you. My question is, will the company introduce any new product lines that could support its business revenue in the future? Thank you.

[Foreign Language]. As mentioned before, our company plans to launch complete machines equipped with Cuckoo 3 chips in the second half of this year and the first half of next year, which is expected to significantly boost sales. Additionally, our photo studio services will contribute to the company's overall revenue. We are also exploring new opportunities in fields such as AI computing to drive our future revenue growth.

And that concludes the question-and-answer session. Let me turn the call over to Mr. Chen for closing remarks.

[Foreign Language]. Thank you very much for joining this conference call. If you have any questions, please contact us through email at [email protected], or reach our IR counsel, Ascent Investor Relations, at [email protected]. Management will respond to your questions as soon as possible. We appreciate your interest and support in Nano Labs and look forward to speaking with you again next time.

Thank you again for attending Nano Lab's First Half of 2024 Earnings Conference Call. This concludes our call today, and we thank you all for listening in. Goodbye.

Ladies and gentlemen, thank you for standing by. Welcome to Nano Labs' Second Half of Fiscal Year 2023 Earnings Conference Call. [Operator Instructions]. This conference is being recorded today, Monday, March 18, 2024. Joining us today from Nano Labs are the company's Chairman and Chief Executive Officer, Mr. Jianping Kong; and the company's Chief Financial Officer, Mr. Bing Chen. On our call today, Mr. Kong will give you an overview of the company's performance. Mr. Chen will share the details of the company's financial results. After that, we will conduct a question-and-answer session to take your questions. Before we continue, I would like to remind you that some information discussed on this call will contain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 as amended and as defined in the U.S. Private Securities Litigation Reform Act of 1995. Such statements are based upon management's current expectations and current market and operating conditions and relate to events that involve 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 or factors is included in the company's filings with the Securities and Exchange Commission. During today's call, Mr. Kong and Mr. Chen will deliver their remarks in Chinese, and the company's representative will provide a corresponding English translation. With that, I will now turn the call over to Mr. Kong, the company's Chairman and Chief Executive Officer. Mr. Kong, please go ahead.

[Foreign Language]. Thank you, operator, and everyone, for joining Nano Labs' Second Half of Fiscal Year 2023 Earnings Conference Call today. In the second half of 2023, our company benefited from the supportive government policy and positive market trends. The Hong Kong government's strong support for the Web3.0 industry and the historic approval of the first Bitcoin spot ETF by the SEC in early 2024 have bolstered the industry in fueling optimism and propelling progress. Our management team is actively pursuing global market expansion opportunities. Through a series of market expansion initiatives, we aim to continue exploring potential market opportunities to increase our market share. [Foreign Language] In terms of research and development, our Cuckoo series integrated products are currently undergoing intensive R&D efforts. Significant advancements were made in the later half of 2023 and we anticipate the launch of enhanced versions of our products in 2024, which are expected to deliver substantially improved performance. Additionally, our company is concurrently upgrading our packaging technology and IPs to enhance the efficiency of chip production. We are also laying the groundwork for research and development of AI computing, ZK computing and other chips to seize emerging market opportunities. [Foreign Language] Our metaverse business line, iPollo Metaverse, offers a photography studio service that includes 3D scanning and 3D printing services. This service has not only received high praise from athletes at the Asian Games, but also provided diverse digital application scenarios for various IPs. It assists in the digitalization of various types of IPs, helping them enter the metaverse track. Furthermore, the photography studio service offers personalized customization services to users, allowing a wide range of enthusiasts to experience the joy of DIY in the metaverse. [Foreign Language] We further believe that with the favorable policies and support, combined with our continuous dedication and efforts, we will continue to progress and provide additional services for the development of the Web3.0 industry. Thank you for your continued support to the company. Next, I will now turn the call over to our Chief Financial Officer, Mr. Chen, for a closer review of our financial results. Mr. Chen, please go ahead.

[Foreign Language]. Thank you, Mr. Kong. Good morning, everyone. On behalf of the management team, I will provide a brief financial overview of the second half of fiscal year 2023. During the period of our performance [indiscernible], we are encouraged to find gradual recovery in the market. Net revenue was RMB26.1 million or USD3.7 million for the second half of 2023 from RMB603 million for the same period of 2022. The decrease in net revenue was primarily due to the drop of sales volume of iPollo V1 Series and B1 Series. Meanwhile, the revenues in 3D printing products, our new products, was RMB787,000 for the second half of 2023 compared to nil for the same period of 2022. Cost of revenues was RMB66.6 million or USD9.4 million for the second half of 2023 compared to RMB549.2 million for the same period of 2022. [Foreign Language]. Operating expenses were RMB83.8 million or USD11.8 million for the second half of 2023 compared to RMB140.7 million for the same period of 2022. Selling and marketing expenses decreased to RMB5.8 million or USD0.8 million for the second half of 2023 compared to RMB14.3 million for the same period of 2022. The decrease in selling and marketing expenses was primarily due to a decrease in advertising fee and marketing promotion expenses. [Foreign Language]. General and administrative expenses decreased to RMB22.4 million or USD3.2 million for the second half of 2023 from RMB36.3 million for the same period of 2022. The decrease in general and administrative expenses was primarily due to a decrease in professional fees and employee salary expenses as the number and salaries of general and administrative staff decreased. [Foreign Language]. Research and development expenses decreased to RMB55.6 million or USD7.9 million for the second half of 2023 from RMB90.2 million for the same period of 2022. The decrease in research and development expenses was primarily due to the decrease in equipment costs, salary expenses and share-based compensation expenses. The company expects to continue its significant investments in research and development to support its future development, product iteration and the competitive strengths. [Foreign Language]. Loss from operations was RMB124.4 million or USD17.6 million for the second half of 2023 compared with loss from operations of RMB86.9 million for the same period of 2022. Net loss was RMB120 million or USD16.9 million for the second half of 2023 compared with RMB80.3 million for the same period of 2022. Basic and diluted loss per share was RMB1.91 or USD0.27 for the second half of 2023 compared with RMB1.47 for the same period of 2022. As of December 21, 2023, we had cash and cash equivalents of RMB48.2 million or USD6.8 million compared with RMB87.8 million as of December 31, 2022. [Foreign Language]. [indiscernible] it will remain our dedication to offering foundational service for the development of the Web3.0 industry. Moving forward, we will continue to move with the market currently intensive R&D efforts to enhance our portfolios and navigate through the challenges at the current rate. We are confident in our ability to enhance shareholder value and sustain business growth. Thank you for your support and trust on our way. Now I would like to turn the call over to the operator for the questions-and-answer session.

[Operator Instructions]. Your first question comes from Oscar Tracey [ph], private investor.

Could you explain the reason behind your underperformed trade value and also your stock price? Thank you.

[Foreign Language]. The primary reason is that our top priority at the current stage, more than anything else, is given to developing our core value and building up our products. Besides while the market is picking up, the lag in stock price and secondary market underplay our performance. We believe that as long as we remain focused on our product quality, we will have an explosive growth in the future with the growing development of Web3.0. Thank you.

Your next question comes from Eva Karan, private investor.

Could you please explain the reasons behind the decline of the company's performance in the second half of 2023 compared with the same period of 2022? Thank you.

[Foreign Language]. First, it takes time for market dynamics to become actual customer demand. So, the positive market trend wasn't well reflected in the sales during the second half of the year. Additionally, although our new product has been showing strong trends, but it didn't significantly contribute to the second half performance as it was launched in the fourth quarter. We believe it will become a substantial growth driver. Furthermore, many of our new products are still in the pipeline and waiting for launch, which have not contributed to our revenue of second half 2023.

Your next question comes from Kathleen Smith, private investor.

What are the company's expectations for the market and also the financial performance in 2024? Thank you.

[Foreign Language]. As the overall package is improving, we anticipate an increase in sales for both V Series and B Series products in 2024 compared to 2023. The new product lines such as 3D printing is going strong currently. So, we expect a market increase in sales as well. Thank you.

Your next question comes from Helena Melvin, private investor.

My question is, does the company have any initiatives to promote brand globally?

[Foreign Language]. Our management team has visited other countries and regions and engaged in valuable discussions with local industry experts and potential partners, which serves as great opportunities for expanding our global market presence. Meanwhile, we continuously participate in exhibitions and events worldwide to promote our products and services. That's all, thank you.

[Operator Instructions]. Your next question comes from Rebecca Aliston, private investor.

Can you hear me?

Yes.

Yes. Sorry, may I know what are the considerations behind the company's agreement with shareholders to convert loans into ordinary shares, which I believe was signed in September last year?

[Foreign Language]. Our major shareholders both have confidence in the future of Nano Labs and the whole industry. Therefore, we are willing to lend to the company and convert it into equity and sales market price. I believe the move is a strong message of confidence and assurance, which will contribute to the company's further development in 2024 and beyond. Thank you.

Thank you. That concludes the question-and-answer session. Let me turn the call over to Mr. Chen for closing remarks.

[Foreign Language]. Thank you very much for joining this conference call. If you have any questions, please contact us through e-mail at [email protected] or reach our IR counsel, Ascent Investor Relations, at [email protected]. Management will respond to your questions as soon as possible. We appreciate your interest and support in Nano Labs and look forward to speaking with you again next time.

Thank you again for attending Nano Labs' Second Half of 2023 Earnings Conference Call. This concludes our call for today, and we thank you for listening. Goodbye.