Good day, ladies and gentlemen. Thank you for standing by. Welcome to Kuaishou Technology Q3 2023 financial results conference call. Please note that English simultaneous interpretation will be provided for management's prepared remarks. This English line will be in listen-only mode. I will now turn the call over to Mr. Matthew Zhao, VP of Capital Market Investor Relations at Kuaishou Technology.
Thank you, operator. Good evening, and good morning to everyone. Welcome to our Q3 2023 financial results conference call. Joining us today are Mr. Cheng Yixiao, Co-founder, Executive Director, and CEO, as well as Mr. Jin Bing, Chief Financial Officer. Before we start, we would like to remind you that today's discussion may contain forward-looking statements, which involve a number of risks and uncertainties. Actual results and outcomes may differ materially from those mentioned in today's announcement and this discussion.
The company does not undertake any obligation to update any forward-looking information except as required by law. During today's call, management will also discuss certain non-IFRS financial measures for comparison purposes only. For a definition of non-IFRS financial measures and a reconciliation of the IFRS to non-IFRS financial results, please refer to our results announcements for the three and nine months ended September 30, 2023, issued earlier today. For today's call, management will use Chinese as the main language. The third-party interpreter will provide a simultaneous English interpretation in the prepared remarks session and consecutive interpreting during the Q&A session. Please note that English interpretation is for convenience purposes only. In the case of any discrepancy, management's statements in their original language will prevail. I will now hand the call over to Yixiao.
Hello, everyone. Welcome to Kuaishou's Q3 2023 earnings call. In the Q3 of 2023, we continued to foster the growth of our healthy and sustainable operations, expanding our base of users, content creators, marketing customers, and merchants. We continued our growth momentum with the steady revenue increases across our various business lines. Accordingly, we achieved a group-level net profit of CNY 2.18 billion and adjusted net profit of CNY 3.17 billion. Our profitability was bolstered by our robust revenue growth across each of our core online marketing, e-commerce, live streaming business segments, as well as our ongoing optimization efforts that improved our operating efficiency. For example, we consistently increased our server and bandwidth utilization efficiency by leveraging advanced technologies. Our server and bandwidth cost as a percentage of revenue has consistently decreased over the last few quarters.
To further optimize our cost efficiency, our own in-house data center, the Kuaishou Smart Cloud Data Center in Ulanqab, Inner Mongolia, was officially launched in July 2023. It's now one of the largest data centers in China, serving high-performance computing power for big data and AI technology advancements. Our proprietary hyperscale data center is designed to house 300,000 servers, making it well-equipped to support the rapid growth of our business as well as our ongoing development goals. Before I go into depth about our Q3 business development, I'd like to update you on recent senior level appointments. As you may have noticed, last week, I've stepped down as the head of the e-commerce business. Thomas Chong is now leading both the e-commerce business and the commercialization business, reporting directly to me.
Having led the e-commerce business for over a year, I gained a valuable insight into the synergies between our traffic and commercial ecosystems. Together with the team, we've built a robust foundation for e-commerce sustainable long-term growth. I believe Thomas's appointment will help maximize the synergies between the upstream and downstream business. My role will now pivot to focus wholly on the CEO position. Here, I will concentrate on Kuaishou's overarching long-term goals, including corporate strategy, organization development, and exploring new industry opportunities. I will also focus on optimizing the synergy between the traffic ecosystem and the monetization system from a holistic perspective. During the past year that Thomas oversaw the commercialization business, he demonstrated exceptional insight into the dynamics of products, our content ecosystem, traffic operations, and monetization. Under his leadership, the company's online marketing revenue has grown rapidly in high double digits.
Looking ahead, we expect Thomas's dual role to strengthen cooperation and synergy between the two business units, solidifying the organization and improving monetization efficiency, thereby contributing to the long-term prosperity of Kuaishou's commercialization ecosystem. Next, I'll discuss our key business developments in Q3. First, user growth and ecosystem construction. In Q3, we maintained a high quality growth across both our user base and traffic, owing to our efficient user growth strategy, extensive high-quality content offerings, and continuous algorithm optimization. Average DAUs and MAUs on the Kuaishou app continued their record-breaking growth momentum during the Q3, reaching 387 million and 685 million respectively, representing YoY increases of 6.4% and 9.4% respectively.
Average daily time spent per DAU on the Kuaishou app was 129.9 minutes in Q3, and our total user time spent grew 6.9% YoY. Moreover, the average daily total video views of our short videos and live streaming content reached nearly 100 billion. We have prioritized the efficiency and quality of our user growth, achieving consistent ROI improvement. This resulted in further decreasing our average user acquisition cost in Q3, both and YoY. Specifically, we intensified our efforts to promote and distribute high-quality original content, including short plays, which led to robust user retention. Meanwhile, by offering high-quality vertical content such as the Summer Star Wish Party, we acquired new users while also increasing the engagement of our existing users. We're also actively exploring new innovative user acquisition channels.
For instance, we extended our reach to a younger demographic through live streaming courses provided by top universities to the public. We have been committed to fostering a differentiated social media platform that inspires users to develop social connections and relations. As of the end of the Q3, pairs of mutual followers on the Kuaishou app reached 32.2 billion, representing a YoY increase of around 40%. In addition, in Q3, average daily interactions, including likes, comments, reposts, and et cetera, on the Kuaishou app exceeded 9 billion. We are dedicated to encouraging high-quality original content creation, supporting the development of diverse content genres, promoting high-quality content featuring distinctive Kuaishou characteristics.
In sports content, as the official broadcaster of a short video sharing platform of the 19th Asian Games Hangzhou, Kuaishou provided user with a panoramic view of the game's rich content and innovative interactive experience with a cutting-edge live streaming technology. During the Asian Games, daily views peaked at around 230 million, with 63.1 billion views of the Asian Games related content. In terms of the short plays, we launched a total of 85 projects as for short plays during the summer vacation period. Of these, 21 short plays surpassed 100 million views, covering various genres, including Asian style, urban, youth, and family. While solidifying our ability to produce blockbuster short plays, we have steadily upgraded our monetization capabilities. In Q3, marketing sponsorship revenue from Project Astro short plays surged by more than 10 times compared with the previous quarter.
In September, we launched the 2023 Back-to-School Season campaign in the pan-knowledge vertical, collaborating with 61 skilled professors and 149 renowned experts. We introduced high-quality educational resources to users through short videos, plus live streaming, contributing to inclusive education. With respect to our search business, we introduced the Kuaishou AI Dialogue function. This is the first intelligent Q&A product based on the large language model in the short video and live streaming industry. This innovation brings an intelligent Q&A and a text creation functions to users within search scenarios, improving users' intelligent search experience. In Q3, searches average monthly users exceeded 470 million. The number of average daily searches on our platform reached over 600 million. The number of daily search inquiries peaked at more than 700 million. We're also accelerating the commercialization of our search service.
Search marketing revenue grew by over 120% YoY. Moving to our monetization progress. First, look at our online marketing services. In Q3, despite the ongoing challenges stemming from the macroeconomic conditions and the slow recovery of marketing customers' confidence, we achieved exceptional online marketing revenue growth, outperforming the industry. This was mainly driven by upgrades to our commercial products, technology developments in our algorithms, and deeper operation in various vertical industries. Specifically, in Q3, our revenue from online marketing services reached CNY 14.7 billion, growing by 26.8% YoY, and accounting for 52.6% of our total revenue. The number of active marketing customers in Q3 increased by more than 140% YoY. In Q3, our external marketing services continued to recover, and the YoY growth rate accelerated compared with Q2.
Notably, we made a substantial progress in industries such as media, information, education and training, and healthcare. We've been focused on refining industry-specific operations. For example, in the education and training industry, we identified the needs of specific high-quality users on our platform, prompting marketing customers to allocate more budgets on our platform. By setting the score of negative- of native marketing materials, we aim to enhance users' content consumption experience and boost the conversion rates for marketing customers. In Q3, the consumption of external native marketing materials increased by more than 30% QoQ. In addition, we introduced an AIGC tool to produce marketing material, boosting the efficiency of marketing customers' productivity, which has substantially reduced production costs. In terms of brand marketing, we leverage our sponsorship of the Hangzhou Asian Games to explore customized brand marketing strategies that align with marketing customers' individual end needs.
To that end, we created a custom IP tailored to diverse scenarios. We also utilized our advantages in traffic, content, and our KOLs ecosystem, creating additional marketing opportunities for marketing customers. For instance, inspired by the concept of Asian Games plus technology, we invented a marketing campaign for China Mobile with the theme of National Champion Dream, Asian Games Mobile Journey. This campaign, which integrated online and offline activities, which showcased in 6 cities, achieving more than 960 million exposures. Marketing services revenue from native e-commerce merchants maintained robust growth in Q3, benefiting from the increased sale of our e-commerce business. Specifically, we focused on the customer composition, traffic alignment, and efficiency improvement. In terms of the customer composition, we emphasized the growth of small and medium-sized merchants within our ecosystem.
Our priority is to incrementally improve how we cultivate these merchant customers, build attraction for their business, and provide an increased policy support for their traffic and operations. Our Omni-platform marketing solution effectively enhanced the synergy between the marketing and e-commerce traffic, amplifying the long-term value of merchants' investment in Omni domain traffic in Q3. Marketing customers' spending from Omni platform marketing solution increased by nearly fivefold compared with the Q2. In terms of efficiency improvement, we increased the stability of ad placement for small and medium-sized merchants with our upgraded Small Smart Hosting product. Live streaming Hosting and Merchandise Hosting were particularly effective in amplifying merchants' ROI by increasing the opportunities for small and medium-sized business to make sizable revenue leaps on our platform. This, in turn, has strengthened these business willingness to allocate a fund to ad placements on Kuaishou.
In Q3, our marketing customer spending through smart hosting increased by nearly 9% QoQ. Second, our e-commerce business. Despite Q3 traditionally being the low season for e-commerce, and our customer confidence are still in the process of recovery, we continue to demonstrate a unique resilience advantage in our e-commerce business. This was attributable to short videos being a more efficient form of content delivery, and also to our clear and distinctive e-commerce strategy, which centers on trusted-based e-commerce relationships and enabling consumers to discover cost-effective goods through reliable streamers and content. In Q3, we further enriched our merchandise and enhanced the buyer conversion efficiency through our refined operations. As a result, our GMV growth has significantly outpaced the industry, increasing by around 30% YoY.
In terms of supply, more merchants are seeking growth opportunities and embracing the benefits our traffic brings to increase their net market penetration, given the current macroeconomic environment. The number of newly onboarded merchants remained at a high level during the Q3. Meanwhile, we optimized our tiered operations for merchants. We also enhanced the policy support to improve the live streaming penetration rate and the number of monthly active merchants on our platform, increased by approximately 50% YoY. Specifically, in Q3, we introduced targeted high potential merchants in major industry zones in 14 cities, offering practical courses to help them rapidly increase their business scale. We also intensified our efforts to promote our case studies and enhance our influence in these industry zones. Additionally, we've implemented tiered and categorized approach to operate and support new merchants.
Based on their content and merchandise capabilities, we provide a differentiated empowerment system, access to cold start resources, as well as traffic support. This reduces the operational challenges for merchants. In Q3, the percentage of merchants with a GMV leaping to all tiers, ranging from CNY 50,000 to over CNY 2 million, increased significantly QoQ. Regarding brand merchants, we are placing greater focus on supply diversity and the brand merchants environment. We have enriched our brand offerings through various channels, such as outlet stores and exclusive shops, resulting in continuous and rapid growth in the number of new brands on our platform. We are consistently improving the merchant environment by providing full support to merchants throughout the process, including attracting brands, cold start, self-operation, as well as distribution.
We fully utilize the Stream Initiative and the Brand Traffic Project to enhance the brand's traffic acquisition app capabilities. Meanwhile, we are continuously improving our traffic matching efficiency. By creating marketing IP, such as the Brand Flash Sales, we further fortify our user mindset while improving conversion efficiency. In the Q3, GMV proportion from brands, including Kuai Brands, continued to increase YoY. Among these, well-known brands, self-operated live streaming achieved impressive results, with the GMV growing by 100% YoY, furthering their increased growth rate on the consecutive quarter basis. In terms of KOLs, we placed a bigger emphasis on the overall health of the ecosystem. We expanded to short videos and shelf-based e-commerce realms, lowering the operational barriers for KOLs.
We have consistently strengthened our distribution channels, improved the merchandise collection efficiency, refined our operations for the growth and development path of mid-tier and long-tail KOLs. The proportion of mid-tier and long-tail KOLs in the overall KOL related GMV has gradually increased by over 20% at the beginning of 2021 to nearly 50% in Q3. In terms of monetization, KOLs are showing higher acceptance of receiving commission from distribution. This is not only due to the unique community atmosphere of Kuaishou, but also in the increasing variety of distributable merchandise. The platform provides more precise matching services, and the pairs of KOL matching merchants on our platform continue to rise QoQ. Overall, merchants and KOLs are collaborating more effectively through the stream initiative, mutually benefiting, coexisting, collectively building on the Kuaishou e-commerce system. The ecosystem's health also depends on the platform infrastructure development.
In Q3, scoring system for merchandise, merchants' experience, and the KOL reputation played a crucial roles in differentiating quality merchants by helping them gain more traffic and reducing exposure for underperforming merchants. We continuously optimize the scoring system by introducing more positive indicators to add value when users are making shopping decisions, reinforcing user trust in the platform, enhancing conversion efficiency, and promoting repeat purchases. With regard to algorithm optimization, we have adopted a hypermodal approach to improve the scale and efficiency of the e-commerce traffic, as it grows across the board. At the same time, we'll continue to promote the content and services ranking mechanism by increasing the algorithm weight of both store and KOL scores.... With respect to the expansion of e-commerce service scenarios, we'll further strengthen our short video and the shelf-based realms.
Short videos have consistently proven effective in recommendations, cultivating fans, funneling traffic to live streaming, as well as fostering real-time transactions. We are continually improving the quality of short video e-commerce content and conversion efficiency by combining the highlights from live streaming and precise recommendations. Short video GMV grew by more than twofold YoY in Q3, making the fifth quarter of consecutive growth. Within shelf-based e-commerce, our search SKU has continually expanded, and the DAUs using Kuaishou search for e-commerce purposes increased by 25% QoQ to over 100 million. Meanwhile, we'll continue to optimize user search experience and improve our capabilities to capitalize on user demands. In Q3, search GMV grew by nearly 70% YoY. In terms of the Shopping Mall, we increased the traffic on paying users' homepage and the shopping tab on the homepage.
We also improved the paying ratio and the user experience by leveraging our differentiation strategy, such as making merchandise information vivid and detailed. This further enhanced the user retention and reduced product returns and negatively reduced by deeply, more deeply integrating the shopping mall with content and refining our inventory operations. We're able to take a deeper dive into the exploration and aggregation of paying users' demand, which enabled us to carry out more targeted measures to attract merchants. We also continuously explored new marketing and operating scenarios to provide merchants with more predictable business opportunities. In Q3, shopping mall GMV continued to grow QoQ, and shelf-based e-commerce GMV accounted for nearly 20% of total GMV. The continuous prosperity of supply and ecosystem further drives the users' demands.
In Q3, our average monthly paying users reached nearly 120 million, with both the absolute number and penetration rate increasing from Q2's peak season. These increases benefited from our refined subsidy and inventory strategy and diverse activities on the platform, including the deep penetration of the Money-Saving Monthly Card, improving conversion efficiency of paying users, and repeat purchase intention, leveraging the optimized efficiency of the smart subsidy, channel management, User Empowerment Project. The quality of users on our platform, especially the quality of new users, improved significantly, and the frequency of monthly orders continued to grow steadily. Third, regarding our live streaming business, in Q3 2023, our live streaming revenue grew by 8.6% YoY, YoY to CNY 9.7 billion.
The increase was attributable to consistently improving high-quality live streaming offerings, better user consumption experience, and continuous optimization of the live streaming ecosystem. On the supply side, we established a regional talent agency operating platform to enhance talent agencies' operating capabilities, as well as drive new user acquisition for streamers and high-quality content supply for small and medium-sized streamers. In Q3, the number of streamers managed by talent agencies grew by over 40%, while streamers' average daily live streaming time increased by 30% YoY. Meanwhile, we continually expanded our diversified supply by developing innovative tools based on the entertainment and live streaming scenarios, and attract high-quality developers to our live streaming open platform, while lowering the entry barriers for streamers. Across both internal and external industry ecosystem, we have successfully increased the supply of multi-host live streaming, bringing users to more high-quality content.
We are firmly committed to building a long-term, healthy, and sustainable live stream ecosystem, while continuously advancing our popular content verticals and nurturing streamers. In September of 2023, we initiated the National Art and Heritage Program to create additional culture IP by providing substantial traffic support and professional training to streamers on our platform who cover traditional Chinese opera, folk music, and folk art. Meanwhile, we'll continue to facilitate AIGC scenarios, including virtual human live streaming and empowered by underlying technological capabilities like real-time capturing, visual effects, and et cetera. These capabilities boost the efficiency of our business innovation by reducing labor and time costs.
Furthermore, as a benchmark case of our Live Streaming Plus services empowering traditional industries, the average daily resume submissions during Q3 are quite high, grew by over 200% YoY, driven by Spring Recruitment and campus recruitment in autumn this year. We also lowered the entry barrier for merchants, by leveraging AIGC in our smart customer service. Additionally, Ideal Housing covered more than 120 cities nationwide, with accumulated gross transaction value surpassing CNY 14 billion in Q3. Finally, in terms of our overseas business progress, in Q3, we continued to advance our strategic focus on key overseas market DAUs and the user time spent in key overseas markets steadily increased YoY. We further diversified our content vertical offerings in the entertainment and sports industries, providing traffic support to mid-tier creators.
Simultaneously, we deepen our local operations, catering to local users' specific consumption needs. Building on this foundation, we intensified our monetization efforts, continuing to improve operating efficiency, which significantly reduced our user growth cost YoY. In Q3, total revenue of our overseas business reached CNY 652 million, more than doubling YoY. By continuously optimizing our operating efficiency, we achieved a 60.2% YoY decrease in overall operating losses overseas in Q3, which also further narrowed the QoQ. On the online marketing services front, we focus on key industries, optimizing marketing efficiency to unlock the commercial potential of various users across different demographics. In Q3, we increased the number of marketing customers of our overseas business by over 200% QoQ, ensuring ongoing customer quality improvement while expanding our customer base.
In addition, we optimized our brand and marketing conversion and increased the advertising inventory. In Brazil, for example, we have extended marketing resources to more well-known brands, such as Amazon, McDonald's. In terms of live streaming services, we continue to promote local operations in overseas markets and focus on tapping into high-value paying users, leading to continuous increases in paying users' penetration rate for live streaming services in Q3. In conclusion, despite facing numerous challenges in Q3 of 2023, we have made significant progress across our core business lines through a deepened focus on refined operations. This concludes my prepared remarks. Thank you. Next, our CFO, Mr. Jin Bing, will discuss the company's financial performance for Q3.
Thank you, Yixiao. Hello, everyone. In Q3 2023, we delivered a robust financial performance. Our group level net profit increased quarter over quarter, reaching CNY 2.18 billion, marking our second consecutive quarter of delivering an IFRS net profit since our IPO. This remarkable achievement can be attributed to our consistent growth across our core business, coupled with our persistent efforts in financial management and refined operational efficiency.
This disciplined management of our costs and expenses continues to unlock operating leverage that enhances our sustainable profitability. At the same time, while fostering high quality user growth, in Q3, our average DAUs and MAUs continued to climb, reaching historical highs. This underscores our ability to improve the user retention through an array of high quality content and algorithm optimization. By combining effective traffic monetization strategies with improved user experience, we are recognizing the increasing value of our user ecosystem, moving towards an era of profitability.
Now, let's take a closer look at our financial performance for Q3 2023. In Q3, our group's revenue grew by 20.8% YoY to CNY 27.9 billion. The increase was driven by growth across each of our core business, including online marketing services, e-commerce, and live streaming. Revenue from our online marketing services increased by 26.7% to CNY 14.7 billion for Q3, from CNY 11.6 billion for the same period of 2022. This growth came from an increasing number of marketing customers, especially from our e-commerce merchants, driven by the increased traffic on our platform and our diversified marketing product portfolio, as well as our industry specific and refined operations. We continue to deepen our refined operations for vertical industries, focusing on marketing customers' needs and improving the content production efficiency.
In terms of marketing services for native e-commerce merchants, we focus on nurturing the growth of small and medium-sized merchants by improving the effectiveness, as introducing omni-platform marketing solution and upgrading products of smart hosting services to reach more demand of them. Our other services revenue increased by 36.6% to 3.5 billion CNY for Q3, from 2.6 billion CNY in the same period of 2022. Led by our growing e-commerce business and its increasing GMV. During the quarter, e-commerce GMV grew by 30% YoY, due to an increased number of active merchants and active e-commerce paying users, as well as our refined operation strategies. We maintain a high number of newly onboarded merchants. We also expanded the range of brands, improving the user shopping experience, and further increased the conversion rates.
Revenue from our live streaming business increased by 8.6% to CNY 9.7 billion for Q3, from CNY 8.9 billion in the same period of 2022. The increase was driven by our continuous efforts to enrich our content supply, enriching our users' access to diverse live streaming content. For Q3, our cost of revenues increased by 8.6% YoY to CNY 13.5 billion, representing 48.3% of our total revenues. This increase was mainly due to increased revenue sharing costs and related taxes, which is in line with our revenue growth, as well as depreciation of property and equipment and right of use assets and amortization of intangible assets. This increase in cost of revenues was partially offset by decreases in bandwidth expenses and server capacity costs.
Gross profit for Q3 grew by 35% YoY, and 3.7% QoQ to CNY 14.5 billion. Gross profit margin reached at 51.7 in Q3, expanding by 5.4 and 1.5 percentage points YoY and QoQ, respectively, benefiting from our top line strength and effective cost control measures. Moving to expenses. Selling and marketing expenses for Q3 decreased by 2.1% YoY to CNY 8.9 billion, accounting for 32% of our total revenues, down from 39.5% in the same period of 2022, largely due to our more disciplined and efficient spending on user acquisition and retention.
Research and development expenses were CNY 3 billion for Q3, decreasing by 16% YoY, accounting for 10% of total revenues in the quarter, dropping from 15.3% in the same period of 2022. The decline in R&D expenses was mainly the result of decreased employee benefit expenses, including related share-based compensation expenses. Administrative expenses decreased by 15.3% YoY to CNY 945 million for Q3, accounting for 3.2% of total revenues, down from 4.6% in the same period of 2022, primarily due to decrease in employee benefit expenses, including related share-based compensation expenses.
Group level net profit for Q3 rose to CNY 2.2 billion, compared to a net profit of CNY 1.5 billion in Q2, and a net loss of CNY 2.7 billion in Q3 2022. Group level adjusted net profit rose to CNY 3.2 billion, compared with adjusted net profit of CNY 2.7 billion in Q2, and adjusted net loss of CNY 672 million in Q3 2022, demonstrating our substantially improved profitability. We maintain a strong balance sheet with cash and cash equivalents, time deposits restricted to cash and wealth management products of CNY 55.4 billion as of September 30, 2023. Owing to our enhanced monetization capabilities and working capital management efficiency, we generated a positive operating net cash flow of CNY 7.7 billion for Q3 2023.
As we look ahead, our primary focus remains anchored in the development of our content and ecosystem, with an emphasis on user growth strategies. We'll continue to strengthen our business capabilities through a system of e-commerce and marketing services, creating a powerful flywheel effect that propels our growth forward. Leveraging the foundation of our enriched content supply and community vitality, we aim to foster deeper connections with our users, making our experience even more engaging. We believe that by staying true to our core strategies, we enhance and to deepen our positive competitive mode, we can seize the growth opportunity and sustain rapid growth. That concludes my prepared remarks. Now we're open for questions.
We will now begin the question and answer session. To ask a question, please press star one and wait for your name to be announced. If you'd like to cancel, please press the pound hash key. One moment for the first question. The first question comes from the line of Thomas Zhang from Jefferies. Please go ahead.
Thanks, management, for taking my questions and congratulations on a strong set of results. We have seen very good results for Double Eleven. Can management comment about the overall performance for the event, progress for shopping mall, and the sustainability and driver for our e-commerce GMV to continue to outpace industry growth? Thank you.
Thank you for your question. Looking at this year's Double Eleven sales promotion, the overall performance beat our expectations, and we are very pleased with the results considering the current market and consumer environment. This year, we upgraded our product capabilities, simplified merchant registration process, and provided official merchandise selection services. Through a more complete traffic mechanism for our blockbuster merchandise and data-driven operational tools, we have successfully built a productization bridge between merchants and our platform. Additionally, with a variety of traffic plans and smart subsidy strategies, we helped merchants incubate blockbuster merchandise and operate big promotions, fostering a scale up in GMV. Furthermore, our event operation capabilities are continuously improving. We had a larger pre-sale scale with a broader range of participating merchants and more comprehensive categories and SKUs this year.
By locking in user's demanded events, our pre-sale GMV increased by 84% YoY. We also launched a Big Brand, Big Subsidy section in shopping mall, capitalizing on users' shopping mentality for getting the most value for money through the operations of benchmark blockbuster merchandise. In terms of shopping mall, we opened homepage traffic access during Double Eleven and kept enriching the product offerings, strengthening merchandise infrastructure, and creating unique marketing scenarios. During the promotion, the shopping mall's GMV grew at a rapid speed, accounting for around 10% of the event's total GMV.... Moving forward in the shopping mall as a complement to our content e-commerce, we'll primarily target users with a shopping mentality to strengthen repeat purchases and meet users' certainty shopping demands, further increasing purchasing frequency.
On the supply side, we'll continue to enhance the integration of content and shop-based realm, utilizing Kuaishou's content advantages and differentiation to strengthen content of merchandise cards. We will also continuously enrich marketing scenarios to strengthen user mentality.
对于快手的电商的高增速、持续性和驱动力，我再分享一些底层逻辑的思考。首先呢，中国电商还没到零和博弈阶段，天花板仍会继续提升，快手在其中发挥着重要作用，这主要得益于我们差异化的用户属性更大众化、更加的下沉。尽管大众人群获取信息的渠道相对有限，但他们对于品质生活和低价好物的追求一直存在，同时消费忠诚度更高，更契合快手的信任电商和社区氛围。我们希望在快手的助力下，大众人群的需求被不断地创造和满足。
Regarding the high growth rate, sustainability, and the driving force of Kuaishou's e-commerce business, let me share some of my personal thoughts on the underlying logic. First, the Chinese e-commerce market hasn't reached a zero-sum stage yet, and its market size will continue to rise. Kuaishou plays an important role in raising the ceiling, primarily thanks to our differentiated user attributes that are more mass market-oriented and go deeper into lower tier markets. Although the mass market demographic has relatively limited channels for accessing information, the pursuit of quality, lifestyle and affordable quality goods is always there. These demographics also have higher consumer loyalty, which aligns well with Kuaishou's trust-based e-commerce and community atmosphere. We hope that with the help of Kuaishou, the needs of the mass market demographic can be continuously created and satisfied.
其次呢，供给侧仍然有较大的增长空间。很多品牌和产业链商家都有成熟的线上运营能力和投入资源的意愿，但在快手的发展还在起步阶段。随着我们平台规则的更合理、清晰，基建和商家商业环境的持续改善，与快手深度合作的意愿也在持续加强。比如，消电家居品类，三季度月通销商家数量同比增涨超过了80%，带动GMV超大盘增长。未来，无论头部类目女装，消电家居，还是当下强劲的运动户外百货等，随着用户需求的多样化和精细化，供给仍在不断创新，我们有信心成为商家重要的线上渠道，增长渠道之一。
Secondly, there is still significant room for growth on the supply side. Many brands and industry's own merchants have mature online operational capabilities and are willing to invest resources, but their development on Kuaishou is still in the early stage. As our platform rules become more reasonable and clear, and the infrastructure and the business environment for merchants continue to improve, their willingness to work deeply with Kuaishou is increasing.
For example, for our consumer electronics and home appliances category, the number of merchants increased by over 80% YoY in the Q3, driving its GMV improvement higher than the platform. In the future, whether it's our top categories like apparel, consumer electronics and home appliances, or outdoor and groceries with strong growth momentum. As users demand to become more diverse and refined, our supply side will continue to innovate. We are confident we can become one of the vital online growth channels for merchants.
此外，不同领域也有持续增长的空间。内容电商通过与内容消费场景的协同，加强对用户需求的洞察，进一步提升匹配精准度和转化效率，那未来泛货架的扩流和建设也有助于提升复购。
Additionally, we see room for continuous growth across different realms. The synergy of content e-commerce integrated with content consumption scenarios enhanced our insights into user preferences and needs. It has also further facilitated more accurate matching of products to users, thereby improving conversion efficiency. Moreover, the planned expansion and development of the shelf-based e-commerce are expected to boost repeat purchases.
关于未来快手电商业务的增长驱动因素，我们有信心持续提升用户购买频次，同时呢，转化更多的买家。当前高双位数的MPU渗透率还有较大的提升空间，同时品牌和品类的丰富也将持续带动客单价的增长。
For the drivers of the Kuaishou e-commerce growth, we are confident in continuously increasing user purchase frequency and convert more users to paying users. At our current stage, there remains substantial potential for enhancing our high double digit penetration rate of MPU. Meanwhile, enriched brands and categories will further propel average order price growth.
Thank you, operator. Next question, please.
下一道问题又来自高盛的 Lincoln Kong. The next question comes from the line of Lincoln Kong from Goldman Sachs. Please go ahead, 请提问。
哎，好，谢谢关先生接受我的提问，也恭喜啊，第四季的很好的业绩。那我的问题是关于广告这边。
...我们也看到，就是，在业绩中有说，三季度这个外循环广告的收入同比增速较二季度有进一步的提升。那可不可以分享一下，具体是哪些行业表现比较好，啊，哪些行业可能还有一些压力？那如果往未来可以看的话，最主要的增长策略是什么？
So thank you for taking my question. I congratulate on the strong set of results. In the press release company mentioned that the Q3 the external advertising revenue growth on a year-on-year basis accelerated from the Q2. So could management elaborate what are the industries that perform well and what are the industries that are having some pressure? So when we're looking forward what will be the growth strategy for the external advertising business? Thank you.
谢谢你的问题。2023年第三季度，我们深化行业精细化的运营，在很多行业都取得了扎实的进展，特别是在传媒资讯、教育培训和大健康等行业取得了不错的成绩。那具体来看，传媒资讯行业中付费短剧增长最好，今年付费短剧行业在快手的投放消耗逐月提升，2023年第三季度付费短剧消耗同比增加超过300%，环比增长近50%。这得益于我们在付费短剧小程序及付费链路上的持续优化，也得益于平台政策扶持带来的付费短剧供给量的快速提升。那教育培训行业，主要由于成人教育赛道贡献，我们对部分重点客户进行深度运营，同时发力快手优势人群赛道，比如中老年教育，获得了营销客户的增量投放预算。对于大家比较关心的游戏行业，三季度小程序游戏的投放消耗同比增加近40%，这主要是由于我们通过链路优化提升了小程序各链路的转化率，同时加大了对代理商的支持激励政策。
Thank you for your question. In the Q3 of 2023, we deepened and refined our operations. We made solid progress in many industries, especially in media, information, education and training, as well as healthcare. Specifically in the media information industry, paid short plays saw the highest growth, with ad placements and spending on Kuaishou, increasing month-over-month this year. In the Q3 of 2023, the ad expenditure of paid short plays grew by over 300% YoY and nearly 50% QoQ. This is attributable to our continuous optimization of the mini programs and payment channels for paid short plays, as well as the rapid increase in the supply of paid short plays under our support policies. In the education and training industry, growth mainly come from adult education.
We executed targeted operations among several key marketing customers, capitalizing on Kuaishou's demographic strengths, particularly in educational offerings for middle-aged and elderly populations. This strategic approach results in augmented budget placement from these marketing customers. With respect to the gaming industry, the marketing expenditure from mini program games increased by nearly 40% YoY in the Q3. This was mainly due to our traffic funnel optimization, which improves the end-to-end conversion for mini program games, as well as our enhanced incentives and support policies for ad agents.
那么相比而言呢，电商平台和交通行业，则受部分重点客户在全媒体投放预算压缩的影响，消耗同比有所下降。但是进入第四季度，受到了双十一大促营销节点拉动，电商平台的外部循环营销日均消耗环比提升至30%。对于交通行业，虽然部分平台类型客户的投放预算有所缩减，但汽车厂商的投放力度有所加大，业务结构健康度和客户丰富度得到了明显的提升。
The e-commerce platform and transportation industry saw a YoY decline in marketing placement due to budget cuts across all media outlets from some of the key customers. However, entering the fourth quarter with the Double Eleven sales promotion, the daily average ad expenditure for external marketing services by the e-commerce platform increased by over 30% QoQ so far. For the transportation industry, despite budget contraction in certain platform type clients, there was a marked increase in marketing by automobile manufacturers. This shift significantly enhanced both the overall business's health and client portfolio.
关于未来的外循环营销的增长策略，我们认为需要对不同行业进行精细化运营。对于线上化率较高的行业，我们需要通过数据基建、算法和产品优化，不断提升转化效率。对于线上化率适中的行业，我们需要通过营销素材原生建设，加强商业化流量与自然流量的协同，同时通过激励政策提升营销客户的ROI。对于线上化率较低的行业，我们需要探索产业化经营，挖掘更多具有快手属性的用户需求，撬动客户的投放预算。此外，我们也会积极通过AI技术降低营销......
素材制作成本，以及通过多轮对话能力提升后链路，强化效果，为外循环的营销增长赋能。
As we look towards future strategies for enhancing our external marketing services, it's necessary to implement industry-specific and refined operations. For sectors with substantial online presence, our focus is on refining conversion efficiency through advanced data infrastructure, algorithmic improvements, and product enhancements. In industries with a moderate online presence, our strategy focuses on creating native marketing content, fostering a cohesive synergy between commercial traffic and organic traffic, and improving the ROI for our marketing customers through support policies.
For sectors with less online presence, our approach involves industrialized operations, tapping into user demand that align with Kuaishou's attributes, and effectively promoting our customers' budget placement. Additionally, we'll leverage AI technology to not only reduce the costs associated with creating marketing materials, but also to improve post-click conversion rates, thereby driving growth of our external marketing services.
Thank you all for your turn. Next question, please.
下一个问题来自Bank of America的Lei Zhang。The next question comes from the line of Lei Zhang from Bank of America。Please go ahead，请提问。
Thanks, management, for taking my question and congrats on a strong profit beat. My question is mainly regarding your new initiative. Can you give us more color on the new business, including local services and Kwai Hire business? Thank you.
谢谢你的问题啊。那经过一年的开始和运营，我们的本地生活业务有了更清晰的策略、打法和目标，也取得了不错的进展。三季度日均GMV较一季度有约五倍的增长，持续通过内容种草激发用户探索吃喝玩乐的需求，同时提供极致性价比和可靠的平台服务，充分利用快手差异化的用户群体，助力各类商家实现快速增长。
Thank you for your question. After a year of exploration and operation, we have developed a clear strategy, approach, and goals for our local services business, and we have made good progress. In Q3, average daily GMVs of local services increased by approximately fivefold compared to Q1. We continue to stimulate user exploration of dining and entertainment through content recommendation, offering users the best bang for their buck and reliable platform services. Leveraging our diverse user base, we support various merchants in achieving rapid growth on our platform.
具体来看呢，三季度本地生活供给端的生态更加繁荣，动销商家数环比增速保持在150%以上。我们将重点运营城市扩展到16城，如新开城市沈阳。快手不仅有用户优势，同时也开拓了大量的有强烈增长诉求的商家资源，成功打造平台现象级爆款旅游案例。品类方面，继续巩固到餐服务，通过高频消费培养用户在快手的本地生活心智，也积极扩展了到店及酒旅的更多细分类别。目前，非餐饮的GMV占比接近了40%。
Specifically, our local services supply ecosystem thrived in Q3, with the number of active merchants maintaining QoQ growth of over 150%. We strategically expanded our focus to 16 key cities, including newly opened cities like Shenyang, in which we not only have user advantages, but also have reached out to and engaged with many merchants who are eager to expand and grow, successfully creating phenomenal blockbuster travel cases across the entire platform. In terms of the categories, we continue to strengthen our foothold in dine-in restaurants, cultivating users' local services mindset through high-frequency consumption. Additionally, we actively expanded into more specific categories such as general in-store hotels and travel. Currently, non-dining related GMV accounts for nearly 40% of our total local services GMV.
快速的城市和品类扩张离不开达人的助力。那三季度呢，我们通过达人产品运营和政策牵引，做大达人规模，继续支持达人做好粉丝建设，生产优质内容，跑通达人成长全链路。达人分销广场日活环比提升超过了2倍。同时，我们通过飞鸟计划等活动打造多个标杆案例，助力快手品牌，华莱士在三季度转化近300万新客，GMV相比一季度增长超过了200%的增长。
...The rapid expansion into cities and categories wouldn't be possible without the support of KOLs. In Q3, we focused on KOL operations and policy incentives, increasing the scale of KOLs and continuing to support them in building fan bases and generating high quality content, further facilitating the full life cycle growth for KOLs, resulting in a more than two-thirds QoQ increase in DAUs on the KOL distribution platform. Through initiatives like the Flying Bird Project, we also established several benchmark cases. For example, we supported the fast food brand, Wallace, helping them convert nearly 3 million new customers in Q3, with the GMV growing over 200% compared to Q1. The thriving ecosystem also relies on more refined operations and traffic strategies. So this quarter, we iterated our merchandise engine, enhancing cost efficiency and scale with a focus on the quality to price ratio.
We optimized the closed loop conversion of live streaming, short videos, and search based on GPM, and efficiently recommended converted and unconverted users consumption needs through more refined traffic and subsidy synergies, strategies. Meanwhile, we improved the platform's management capabilities, establishing a 2B governance system and a 2C user preservation system, bolstering consumer trust. We are continuously discovering and fulfilling user needs, achieving nearly 260% growth in daily paying users in Q3 compared to the first half of 2023. In Q4, our primary focus is to convert more local users, further enhance operations in our existing key cities, refine the operations of merchants and KOLs, and continue creating blockbuster merchandise to amplify our reach. Also, we will strengthen users getting the most value for your money mentality through a more efficient subsidies and traffic strategies to consistently expand our business scale.
In Q3, Kuaishou continued its robust growth momentum. The number of active merchants increased over 120% YoY, and the average daily resume submissions grew by more than 200% YoY. On the job supply side, we proactively expanded the platform's offerings in scarce job categories, iterated our exclusive recommendation model, and enhanced its matching accuracy capabilities. Furthermore, we sustained efforts in commercial exploration by enriching our product line, optimizing matching efficiency, improving client experience, and establishing a sales system. These initiatives aim to assist merchants with substantial hiring needs in overcoming resume bottlenecks.
Thank you, operator. Next question, please.
The next question comes from the line of Alex Poon of Morgan Stanley. Please go ahead.
My question is related to our capital return policy. Given we have reached breakeven and very strong margin improvement and cash flow, can management discuss our cash flow policy and our... is there room for increasing our capital returns in future? Thank you very much.
好的，谢谢你的问题。得益于公司的持续盈利和精细化的资金管理，我们在三季度的经营活动现金大幅流入约 CNY 7.7 billion，同环比是均有增长的。截止到三季度末，现金和现金等价物约为 CNY 11.3 billion。 如果考虑到现金管理中其他可以实际利用的资金，比如定期存款和金融资产等等，我们截止到三季度末，实际可利用的资金总额，包括口径的现金，为 CNY 55.7 billion，环比二季度末增加了约 CNY 5.0 billion。公司从 2022 年二季度末起，实际可利用的资金总额一直是处于增长的趋势，体现了现金储备的充足。
Thank you for your question. Thanks to the company's sustained profitability and refined capital management, our operating cash flow in Q3 experienced a significant inflow of CNY 7.7 billion, showing growth both YoY and QoQ. As of the end of Q3, our cash and cash equivalent totaled CNY 11.3 billion. When considering other available funds, such as time deposits and financial assets, our total available funds amounted to CNY 55.4 billion as of the end of Q3, representing a QoQ increase of approximately CNY 5 billion compared to the end of Q2. Since Q2, 2022, the total available funds have consistently shown an upward trend in our group's robust cash reserves
那么关于公司的现金管理政策，我们一直保持着审慎的资金管理原则，安全性为第一考量，同时兼顾资金的流动性和收益性。出于对公司经营状况和现金流的信心，也同时为了回馈股东，我们在今年五月公布了HKD 4 billion的股份回购计划。截至目前，我们的股份回购计划累计回购金额约HKD 907 million，累计回购股份约15,880,000股。接下来，我们还会继续根据市场情况，合理地安排股份回购的节奏。关于分红计划，取决于一系列的考量因素，如果有任何的进展，我们也会及时与市场公布。
Regarding our cash management policy, we consistently maintain a prudent approach to capital management, prioritizing safety while balancing liquidity and profitability. To show our confidence in the company's operating performance and cash flow, and to reward shareholders, we announced a HKD 4 billion share repurchase plan in May of this year. As of now, the cumulative repurchase amount under this plan is approximately HKD 907 million, and the total repurchase shares amount to approximately HKD 15.88 million. Moving forward, we will continue to assess market conditions and prudently manage the pace of share repurchase. Regarding the dividend plan, it depends on various factors. If there are any new developments, we will update the market promptly.
Thank you, operator. The last question, please.
The last question comes... 最后一道问题是来自CICC的张雪琴。The next question comes from the line of Xueqing Zhang from CICC. Please go ahead, 请提问。
Thanks, management, for taking my question and congratulations on the strong quarter. My question is about AI, and can management share with us the latest progress in AI and what kind of large language model application we currently have? Thank you.
谢谢你的问题。我们在今年年初呢，启动了新的AI战略，并制定了战略目标，确保在可能到来的新技术突破中保持国内第一梯队，结合并赋能现有业务场景，同时力争通过自主颠覆式的技术，技术创新，带来业务领先优势，改变市场格局。从目前实际的进展来看，还是符合我们的预期的。
Earlier this year, we initiated a new AI strategy, setting strategic goals to ensure that we remain at the top tier of domestic technology breakthroughs. We aim to integrate and empower existing business scenarios while striving for a leading advantage through disruptive technological innovation, ultimately reshaping the market landscape. Our progress is moving forward as expected.
那么具体展开来说呢，我们的语言大模型快意、130亿和660亿大模型，已经达到了行业内同等规模的领先水平。同时，我们也已经开始超千亿规模语言大模型，以及多模态大模型的研发。此外，我们也推出了文生图大模型，可图具备强大的文本理解，丰富的细节刻画和多样的风格转化能力，可以基于开放式文本生成风格多样，画质精美，创意十足的绘画作品。
To give you a little more detail, our LLMs KwaiYii, 13 billion and 66 billion models have achieved a leading positions in the industry at a comparable scale. Meanwhile, we have embarked on the development of LLMs, exceeding 100 billion in scale and multimodal model. We have also introduced an AI text to image LLM, Ket u, equipped with robust text comprehension, rich detailed depiction, and diverse style transformation tech capabilities. This model can generate a variety of artworks based on open-ended text input, featuring diverse styles, excellent quality, and abundant creativity.
目前，我们也在加速推进大模型场景化落地。那在内容消费侧呢，依托可图大模型，我们在短视频评论区推出了AI、AI玩屏功能。用户输入各种创意文字，即可一键生成海量风格图片，从而更便捷地在评论区进行互动。近期，我们也开始内测AI小块账号，在短视频评论区为用户提供互动问答、图片生产、攻略检索、文案修改等多种基于短视频应用场景的AI机器服务。在内容供给侧呢，快手旗下的视频剪辑类产品快影和功能拍摄类产品，一甜相机已经具备了多种AI机器创作能力，让创作者轻松地将照片或者视频转换为不同风格和效果的内容，并自动生成符合内容语境的文案。在商业化场景侧，我们的大模型在营销素材、创意短视频素材生成、快聘和房产直播的数字人播报和互动多对话等场景的应用也越来越广泛。
We are currently accelerating the application of the LLMs in various scenarios. On the content consumption side, leveraging the Ket u LLM, we have introduced the AI image for comments function in the short videos comment section. Users can put creative text to instantly generate vast images of different styles, enabling more convenient and entertaining interactions within the comment section. Recently, we have also initiated beta testing of the AI Kwai account that offers users interactive Q&A, image generation, searching of guidance and walkthroughs, and text editing services, all tailored to the use case of short video scenarios. On the content supply side, Kuaishou's new editing app, Kwai Ying, and the photography app, Yitian Camera, have both been upgraded with multiple AIGC capabilities. This allows content creators to conveniently transform photos or videos into content with multiple styles and effects, and to automatically generate captions that match the content.
On the monetization scenario side, the breadth of our LLMs application continues to expand, including generating creative materials for marketing, digital human reporting, and interactive mediations in Kwai Hire and real estate live streaming.
总的来说，快手目前各个技术团队和业务部门都在积极拥抱大模型的技术浪潮，我们期待且相信未来还有更多大规模应用呈现给大家。
In essence, every technical and business department within Kuaishou is enthusiastically adopting the new wave of LLM technology. We look forward to and believe that there will be even more LLM applications in our future endeavors.
Thank you, operator. That's the end of the Q&A session.
今天的问答环节到此结束，现在有请Matthew做总结性发言。
好，谢谢 operator，感谢大家今天的参与。如果您还有更多问题，欢迎随时与快手的资本市场及投资者关系团队取得联系。谢谢大家！
Thank you once again for joining us today. If you have any further questions, please contact our capital market and investor relations team at any time. Thank you.