Sound Group Inc's Business Segments

Sound Group Inc., together with its subsidiaries and variable interest entities (VIEs), operates platforms and applications that provide audio content and services. The company measures its user base by active users, defined as mobile devices that launch its applications, and paying users, who purchase virtual items or other products and services on its platforms. Sound Group Inc. offers user-generated content, including podcasts and online audio programs hosted by content creators. The company employs technologies such as artificial intelligence (AI), automatic speech recognition (ASR), text-to-speech (TTS), and voice cloning to enhance its audio offerings and supports real-time audio and video communication (RTC). Its operations are primarily conducted in China, excluding Taiwan, Hong Kong, and Macau. Sound Group Inc. controls its VIEs through contractual arrangements but does not own them. The company’s shares consist of Class A and Class B ordinary shares and American depositary shares (ADSs). Its business includes recruiting, managing, training, and supporting hosts through organized groups known as guilds. Financial information is reported in Renminbi and U.S. dollars, with specified exchange rates. Forward-looking statements address growth strategies, business development, regulatory environment, and economic conditions affecting its operations.

The Company has identified a single reportable operating segment. Operating segments are defined as components of an enterprise for which separate financial information is available and regularly evaluated by the chief operating decision maker (CODM), who is the chief executive officer (CEO). The Company's revenue segments share similar economic characteristics and are managed as one business unit. The determination of reportable operating segments is based on the management approach, reflecting the internal organization and reporting used by the CEO for operating decisions and performance assessment.