0001410578-24-001728 | 20-F | XBRL Viewer

Taxes Payable

12 Months Ended

Dec. 31, 2023

9.Taxes Payable

The Group’s subsidiaries, the VIEs and subsidiaries of the VIEs incorporated in China are subject to 6% VAT for services rendered.

The following is a summary of taxes payable as of December 31, 2022 and 2023:


	December 31, 2022	December 31, 2023
	RMB	RMB
VAT payables	1,846	1,441
Withholding individual income taxes for employees	2,533	2,168
Income tax payable	557	496
Others	485	358
Total	5,421	4,463

ADDITIONAL INFORMATION: CONDENSED FINANCIAL STATEMENTS OF PARENT COMPANY - CONDENSED BALANCE SHEETS - Parentheticals (Details) - $ / shares	Dec. 31, 2023	Dec. 31, 2022
CONDENSED FINANCIAL STATEMENTS OF PARENT COMPANY
Ordinary shares, shares authorized	1,500,000,000
Class A ordinary shares
CONDENSED FINANCIAL STATEMENTS OF PARENT COMPANY
Ordinary shares, par value	$ 0.0001	$ 0.0001
Ordinary shares, shares authorized	1,268,785,000	1,268,785,000
Ordinary shares, shares issued	838,962,260	818,962,260
Ordinary shares, shares outstanding	819,084,610	803,607,050
Class B ordinary shares
CONDENSED FINANCIAL STATEMENTS OF PARENT COMPANY
Ordinary shares, par value	$ 0.0001	$ 0.0001
Ordinary shares, shares authorized	231,215,000	231,215,000
Ordinary shares, shares issued	231,215,000	231,215,000
Ordinary shares, shares outstanding	231,215,000	231,215,000
Parent company \| Reportable legal entity \| Class A ordinary shares
CONDENSED FINANCIAL STATEMENTS OF PARENT COMPANY
Ordinary shares, par value	$ 0.0001	$ 0.0001
Ordinary shares, shares authorized	1,268,785,000	1,268,785,000
Ordinary shares, shares issued	838,962,260	818,962,260
Ordinary shares, shares outstanding	819,084,610	803,607,050
Parent company \| Reportable legal entity \| Class B ordinary shares
CONDENSED FINANCIAL STATEMENTS OF PARENT COMPANY
Ordinary shares, par value	$ 0.0001	$ 0.0001
Ordinary shares, shares authorized	231,215,000	231,215,000
Ordinary shares, shares issued	231,215,000	231,215,000
Ordinary shares, shares outstanding	231,215,000	231,215,000

Related party transactions	12 Months Ended
Dec. 31, 2023
Related party transactions
Related party transactions	18.Related party transactions In January 2023, Vocal Beats, a wholly owned subsidiary of the Group in the British Virgin Islands, entered into a share subscription agreement with Sky Voice Limited, a company registered in the British Virgin Islands and controlled by a family trust of Mr. Jinnan (Marco) Lai, Chairman of the Board of Directors and CEO. Under the terms of the agreement, pursuant to which Vocal Beats issued 31,481,481 ordinary shares to Sky Voice Limited at an aggregate subscription price of US$0.3 million. Upon completion of the transaction, Sky Voice Limited and LIZHI INC. hold 31.48% and 68.52% of Vocal Beats, respectively. After the share subscription, the total issued shares of Vocal Beats were 100,000,000 at a par value of US$0.0001.

Related party transactions

12 Months Ended

Dec. 31, 2023

Related party transactions

Related party transactions

18.Related party transactions

In January 2023, Vocal Beats, a wholly owned subsidiary of the Group in the British Virgin Islands, entered into a share subscription agreement with Sky Voice Limited, a company registered in the British Virgin Islands and controlled by a family trust of Mr. Jinnan (Marco) Lai, Chairman of the Board of Directors and CEO. Under the terms of the agreement, pursuant to which Vocal Beats issued 31,481,481 ordinary shares to Sky Voice Limited at an aggregate subscription price of US$0.3 million. Upon completion of the transaction, Sky Voice Limited and LIZHI INC. hold 31.48% and 68.52% of Vocal Beats, respectively.

After the share subscription, the total issued shares of Vocal Beats were 100,000,000 at a par value of US$0.0001.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480990/946-20-50-2

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 5
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480990/946-20-50-5

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480990/946-20-50-6

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 235
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481062/946-235-50-2

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 235
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (e)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481062/946-235-50-2

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483326/850-10-50-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.6-07(2)(g)(3))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483575/946-220-S99-1

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.6-07(2)(c))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483575/946-220-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.6-07(2)(e))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483575/946-220-S99-1

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//850/tableOfContent

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483326/850-10-50-6

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483326/850-10-50-1

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483326/850-10-50-1

+ Details

Accounts Receivable Net - Summary of Accounts Receivable Net (Details) ¥ in Thousands, $ in Thousands	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)
Accounts Receivable, Net
Accounts receivable, gross:	¥ 1,596		¥ 3,233
Less: allowance for expected credit loss of receivables	(39)
Accounts receivable, net	¥ 1,557	$ 219	¥ 3,233

Leases - Summary of Lease Cost (Details) ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)
Leases
Operating lease cost	¥ 16,903		¥ 17,284	¥ 10,329
Short-term lease cost	12,895		10,974	9,353
Total lease cost	29,798		28,258	19,682
Cash paid for operating leases	18,257		17,910	9,786
Right-of-use assets obtained in exchange for operating lease liabilities	¥ 6,127	$ 863	¥ 13,505	¥ 34,988

Commitments and Contingencies - Lease commitments (Details) ¥ in Millions	Dec. 31, 2023 CNY (¥)
Commitments and Contingencies.
Total future lease payment	¥ 27.8
Lease payments under operating leases	23.7
Lease payments more than one year and less tha three years	¥ 4.1

CONSOLIDATED STATEMENTS OF CASH FLOWS ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)
Cash flows from operating activities:
Net (loss)/income	¥ (134,515)	$ (18,947)	¥ 86,504	¥ (127,250)
Adjustment to reconcile net (loss)/income to net cash generated from/(used in) operating activities:
Depreciation of property, equipment and leasehold improvement	13,200	1,862	18,056	19,225
Amortization of intangible assets	983	138	1,202	1,686
Amortization of right-of-use assets	16,903	2,381	14,557	10,329
Foreign exchange losses	1,488	210	1,052	738
Investment income	(188)	(26)	(331)
Interest expense			217
Share-based compensation	26,755	3,768	29,233	37,359
Allowance for expected credit loss	90,789	12,787
Losses/(gains) on disposal of property equipment	(438)	(62)	105
Changes in operating assets and liabilities:
Accounts receivable	1,637	231	3,225	1,903
Prepayments and other current assets	(94,572)	(13,320)	4,012	(15,935)
Accounts payable	(10,648)	(1,500)	(26,961)	2,526
Deferred revenue	(6,429)	(906)	15,020	3,656
Salary and welfare payable	499	70	11,505	29,998
Taxes payable	(549)	(77)	537	1,691
Lease liabilities	(18,057)	(2,543)	(15,169)	(8,279)
Accrued expenses and other current liabilities	31	4	(5,997)	2,886
Other non-current liabilities	(3,952)	(557)	(500)	(959)
Net cash (used in)/generated from operating activities	(117,000)	(16,487)	136,267	(40,426)
Cash flows from investing activities:
Purchase of property, equipment and leasehold improvement	(5,961)	(840)	(11,691)	(20,075)
Purchase of intangible assets	(1,261)	(178)	(149)	(855)
Purchase of short-term investments			(191,022)
Maturities of short-term investments	111,022	15,637	80,000	73,022
Net cash received from disposal of property, equipment and leasehold improvement	1,853	261	79	9
Net cash generated from/(used in) investing activities	105,653	14,880	(122,783)	52,101
Cash flows from financing activities
Proceeds from issuance of ordinary shares				183,188
Proceeds from exercise of vested share options	5	1	5	3
Proceeds from short-term loans	40,900	5,761	72,015	49,248
Repayments of short-term loans	(114,878)	(16,180)	(67,249)	(19,757)
Capital contributions from the non-controlling interest shareholders	2,299	324
Net cash generated from/(used in) financing activities	(71,674)	(10,094)	4,771	212,682
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash	2,168	307	22,812	(6,063)
Net increase/(decrease) in cash, cash equivalents and restricted cash	(80,898)	(11,394)	41,067	218,294
Cash, cash equivalents and restricted cash at beginning of the year	578,515	81,482	537,448	319,154
Cash, cash equivalents and restricted cash at end of the year	497,617	70,088	578,515	537,448
Reconciliation to amounts on consolidated balance sheets:
Cash, cash equivalents	494,965		568,192	533,293
Restricted cash	2,652		10,323	4,155
Total Cash, cash equivalents and restricted cash shown in the consolidated statements of cash flows	497,617		578,515	537,448
Supplemental disclosures of cash flow information:
Cash paid for interest expense	(2,051)	(289)	(2,227)	(3,141)
Income taxes paid	(495)	(70)	(100)	(924)
Supplemental disclosures of non - cash activities:
Right-of-use assets obtained in exchange for operating lease liabilities	6,127	863	13,505	34,988
Share-based compensation	¥ 26,755	$ 3,768	¥ 29,233	¥ 37,359

Net (Loss)/Income per Share

12 Months Ended

Dec. 31, 2023

Net (Loss)/Income per Share

Net (Loss)/Income per Share

15.Net (Loss)/Income per Share

For the years ended December 31, 2021, 2022 and 2023, the following shares outstanding were excluded from the calculation of diluted net (loss)/income per share, as their inclusion would have been anti-dilutive for the periods prescribed but which could potentially dilute EPS in the future.


	For the year ended December 31,
	2021	2022	2023
Share options	7,036,117	—	—
Restricted shares	5,680,877	—	—
Restricted share units	2,462,618	—	—
Total	15,179,612	—	—

The following table sets forth the computation of basic and diluted net (loss)/income per share of the Company for the years ended December 31, 2021, 2022 and 2023:


	For the year ended December 31,
	2021	2022	2023
	RMB	RMB	RMB
Numerator:
Net (loss)/income	(127,250)	86,504	(134,515)
Less: accretions to preferred shares redemption value	—	—	—
Less: net loss attributable to the non-controlling interest shareholders	—	(13)	(7,864)
Net (loss)/income attributable to Sound Group Inc.’s ordinary shareholders	(127,250)	86,517	(126,651)

Denominator:
Weighted average number of ordinary shares outstanding, basic	991,715,849	1,036,485,949	1,078,969,851
Add:
Share options	—	852,691	—
Restricted shares	—	1,279,270	—
Weighted average number of ordinary shares outstanding, diluted	991,715,849	1,038,617,910	1,078,969,851

Basic net (loss)/income per share attributable to Sound Group Inc.’s ordinary shareholders	(0.13)	0.08	(0.12)
Diluted net (loss)/income per share attributable to Sound Group Inc.’s ordinary shareholders	(0.13)	0.08	(0.12)

Accounts Receivable Net - Movements of the credit loss provision (Details) ¥ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥)
Schedule of movements of the credit loss provision
Current year provision	¥ (39)
Balance at end of the year	¥ (39)

Prepayments and Other Current Assets (Tables)

12 Months Ended

Dec. 31, 2023

Prepayments and Other Current Assets

Summary of prepayments and other current assets


	December 31,	December 31,
	2022	2023
	RMB	RMB
Receivables from a third-party financial institution⁽¹⁾	—	90,659
Prepayments to vendors	16,110	11,815
Deposits	5,286	5,624
Receivables from third-party online payment platform	2,612	1,884
Deductible VAT	2,399	4,922
Receivables from bank funds in transit	—	4,604
Staff advances	393	325
Others	3,591	4,831
Sub-total	30,391	124,664
Less: allowance for expected credit loss of receivables	—	(90,750)
Total	30,391	33,914

(1)	As of December 31, 2023, receivables from a third-party financial institution amounting to RMB90.7 million (US$12.8 million) are subject to a risk of default, as disclosed in Note 21. Consequently, full allowance for credit loss provision has been recorded.

Taxes Payable - Additional Information (Details)	12 Months Ended
Taxes Payable - Additional Information (Details)	Dec. 31, 2023
Taxes Payable
Value added tax rate	6.00%

Taxation - Summary of Operating Loss Carry Forward (Details) - CNY (¥) ¥ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Taxation
Operating loss carryforwards	¥ 116,862	¥ 108,601
Loss expiring in 2024
Taxation
Operating loss carryforwards	14,186
Loss expiring in 2025
Taxation
Operating loss carryforwards	18,968
Loss expiring in 2026
Taxation
Operating loss carryforwards	42,858
Loss expiring in 2027
Taxation
Operating loss carryforwards	28,366
Loss expiring in 2028
Taxation
Operating loss carryforwards	69,256
Loss expiring in 2029
Taxation
Operating loss carryforwards	156,879
Loss expiring in 2030
Taxation
Operating loss carryforwards	156,066
Loss expiring in 2031
Taxation
Operating loss carryforwards	207,664
Loss expiring in 2032
Taxation
Operating loss carryforwards	14,027
Loss expiring in 2033
Taxation
Operating loss carryforwards	98,722
Operating loss carry forwards
Taxation
Operating loss carryforwards	¥ 806,992

Cost of Revenues

12 Months Ended

Dec. 31, 2023

Cost Of Revenues

Cost of Revenues

12.Cost of Revenues

The following is a summary of cost of revenues for the years ended December 31, 2021, 2022 and 2023:


	For the year ended December 31,
	2021	2022	2023
	RMB	RMB	RMB
Revenue sharing fees	1,357,270	1,351,096	1,368,498
Salary and welfare benefits	52,268	40,653	45,273
Payment handling costs	32,506	22,899	21,076
Bandwidth costs	30,889	32,795	39,424
Share-based compensation expense	11,484	7,052	3,845
Others	18,088	14,426	8,281
Total	1,502,505	1,468,921	1,486,397

Share-based Compensation (Tables)

12 Months Ended

Dec. 31, 2023

Share-based Compensation

Summary of share-based compensation


	For the year ended December 31,
	2021	2022	2023	2023
	RMB	RMB	RMB	US$
Cost of revenues	11,484	7,052	3,845	542
Selling and marketing expenses	3,431	2,259	2,012	283
General and administrative expenses	12,496	9,659	9,458	1,332
Research and development expenses	9,948	10,263	11,440	1,611
Total	37,359	29,233	26,755	3,768

summary of the company's stock options activities



				Weighted average	Remaining	Aggregated
	Employees	Consultants	Total	exercise price	contractual life	intrinsic value
	(in thousands)	(in thousands)	(in thousands)	US$		RMB

Outstanding at January 1, 2021	37,804	863	38,667	0.0001	3.09	48,921
Granted	32,389	—	32,389	0.0001	—	—
Exercised	(4,925)	—	(4,925)	0.0001	—	—
Forfeited	(15,571)	—	(15,571)	0.0001	—	—
Outstanding at December 31, 2021	49,697	863	50,560	0.0001	2.56	29,786
Exercisable as of December 31, 2021	8,216	341	8,557	0.0001	—	5,041

Outstanding at January 1, 2022	49,697	863	50,560	0.0001	2.56	29,786
Granted	24,924	—	24,924	0.0001	—	—
Exercised	(7,894)	—	(7,894)	0.0001	—	—
Forfeited	(6,076)	—	(6,076)	0.0001	—	—
Outstanding at December 31, 2022	60,651	863	61,514	0.0001	2.98	13,452
Exercisable as of December 31, 2022	16,421	682	17,103	0.0001	—	3,740

Outstanding at January 1, 2023	60,651	863	61,514	0.0001	2.98	13,452
Granted	15,593	—	15,593	0.0001	—	—
Exercised	(4,632)	—	(4,632)	0.0001	—	—
Forfeited	(326)	—	(326)	0.0001	—	—
Outstanding at December 31, 2023	71,286	863	72,149	0.0001	2.16	6,950
Exercisable as of December 31, 2023	36,811	863	37,674	0.0001	—	3,629

Summary of restricted shares activities


		Weighted-Average
	Number of Restricted Shares	Grant Date
	Granted	Fair Value
	(in thousands)	US$

January 1, 2021	9,857	0.23
Awarded	—	—
Forfeited	—	—
Vested	(6,232)	0.24
Outstanding at December 31, 2021	3,625	0.21

January 1, 2022	3,625	0.21
Awarded	—	—
Forfeited	—	—
Vested	(3,625)	0.21
Outstanding at December 31, 2022	—	—

January 1, 2023	—	—
Awarded	—	—
Forfeited	—	—
Vested	—	—
Outstanding at December 31, 2023	—	—


	Number of Restricted Share	Weighted-Average
	Units Granted	Grant Date Fair Value
	(in thousands)	US$

January 1, 2021	4,510	0.20
Awarded	13,080	0.30
Forfeited	(2,308)	0.20
Vested	(3,018)	0.19
Outstanding at December 31, 2021	12,264	0.31

January 1, 2022	12,264	0.31
Awarded	2,193	0.07
Forfeited	(2,612)	0.33
Vested	(3,649)	0.29
Outstanding at December 31, 2022	8,196	0.29

January 1, 2023	8,196	0.29
Awarded	6,688	0.03
Forfeited	(5,558)	0.24
Vested	(9,148)	0.10
Outstanding at December 31, 2023	178	0.16

Taxation - Summary of Significant Components of Deferred Tax Assets (Details) - CNY (¥) ¥ in Thousands	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Taxation
Net operating tax loss carry forwards	¥ 116,862	¥ 108,601
Advertising expenses in excess of deduction limit	1
Total deferred tax assets	116,863	108,601
Less: valuation allowances	¥ (116,863)	¥ (108,601)	¥ (112,838)	¥ (74,607)

Taxation

12 Months Ended

Dec. 31, 2023

Taxation

Taxation

8.Taxation

a)Income taxes

Cayman Islands

Under the current laws of the Cayman Islands, the Company is not subject to tax on income or capital gain. Additionally, upon payments of dividends by the Company in the Cayman Islands to its shareholders, no Cayman Islands withholding tax will be imposed.

British Virgin Islands

Under the current laws of the British Virgin Islands, entities incorporated in British Virgin Islands are exempted from income tax on their foreign-derived incomes in the BVI. There are no withholding taxes in the BVI.

Singapore

Under the Singapore tax laws, subsidiaries in Singapore are subject to a unified 17% tax rate, except for certain entities that are entitled to preferential tax treatments, and there are no withholding taxes in Singapore on remittance of dividends. For the years ended December 31, 2021, 2022 and 2023, the Company’s overseas entity recognized income tax expense/(credit) amounted to RMB0.3 million, RMB0.1 million and RMB(0.1) million, respectively, for the assessable profits base on the existing legislation, interpretation and practice of Singapore.

Hong Kong

Subsidiaries incorporated in Hong Kong are subject to Hong Kong profits tax at a two-tiered regime under which the tax rate is 8.25% for assessable profits on the first HK$2 million and 16.5% for any assessable profits in excess of HK$2 million. As an anti-avoidance measure, a group of “connected entities” can only nominate one entity within the Group to enjoy the reduced tax rate for a given year of assessment.

China

Under the Enterprise Income Tax Law of the PRC, the Company’s Chinese subsidiaries, VIEs and subsidiaries of the VIEs are subject to an income tax of 25%, except for Guangzhou Lizhi and Guangzhou Huanliao. Due to their current status of entitled High and New Technology Enterprise (“HNTE”), Guangzhou Lizhi and Guangzhou Huanliao enjoy a preferential tax rate of 15% for the year ended December 31, 2021, 2022 and 2023. This status is subject to annual evaluation and a requirement that Guangzhou Lizhi and Guangzhou Huanliao reapply for HNTE status every three years.

8.	Taxation (Continued)

a)Income taxes (Continued)

The following table presents a reconciliation of the differences between the statutory income tax rate and the Company’s effective income tax rate for the years ended December 31, 2021, 2022 and 2023:


	For the year ended December 31,
	2021	2022	2023
	%	%	%
Statutory income tax rate of the PRC	25.0	25.0	25.0
Tax rate difference from preferential tax treatments and statutory rate in other jurisdictions	(16.5)	(0.1)	(29.6)
Effect of withholding taxes	(0.3)	—	—
Permanent differences⁽¹⁾	26.6	(33.4)	25.4
Change in valuation allowances	(35.2)	8.7	(21.2)
Effective income tax rate	(0.4)	0.2	(0.4)

(1)	The permanent differences mainly consist of additional super deduction for research and development expenditures, and certain non-deductible expenses.

As of December 31, 2023, certain entities of the Company had net operating tax loss carry forwards as follows:


		RMB

Loss expiring in 2024		14,186
Loss expiring in 2025		18,968
Loss expiring in 2026		42,858
Loss expiring in 2027		28,366
Loss expiring in 2028		69,256
Loss expiring in 2029		156,879
Loss expiring in 2030		156,066
Loss expiring in 2031		207,664
Loss expiring in 2032		14,027
Loss expiring in 2033		98,722
		806,992

b)Deferred tax assets and liabilities

The following table presents the tax impact of significant temporary differences that give rise to the deferred tax assets as of December 31, 2022 and 2023:


	December 31, 2022	December 31, 2023
	RMB	RMB
Deferred tax assets:
Net operating tax loss carry forwards	108,601	116,862
Advertising expenses in excess of deduction limit	—	1
Total deferred tax assets	108,601	116,863
Less: valuation allowances	(108,601)	(116,863)
Net deferred tax assets	—	—

8.	Taxation (Continued)

b)Deferred tax assets and liabilities (Continued)

The Group does not believe that sufficient positive evidence exists to conclude that the recoverability of deferred tax assets of certain entities of the Group is more likely than not to be realized. Consequently, the Group has provided full valuation allowances on the related deferred tax assets. The following table sets forth the movement of the aggregate valuation allowances for deferred tax assets for the years presented:


	Balance at January 1	Movement*	Balance at December 31
	RMB	RMB	RMB
2021	(74,607)	(38,231)	(112,838)
2022	(112,838)	4,237	(108,601)
2023	(108,601)	(8,262)	(116,863)

*	The movement in valuation allowances were due to the changes of deferred tax assets recognized for net operating tax loss carry forwards, advertising expenses in excess of deduction limit and deferred revenue.

c)Withholding income tax

The enterprise income tax (“EIT”) Law also imposes a withholding income tax of 10% on dividends distributed by a foreign-invested entity (“FIE”) to its immediate holding company outside of China, if such immediate holding company is considered as a non-resident enterprise without any establishment or place within China or if the received dividends have no connection with the establishment or place of such immediate holding company within China, unless such immediate holding company’s jurisdiction of incorporation has a tax treaty with China that provides for a different withholding arrangement. The Cayman Islands, where the Company incorporated, does not have such tax treaty with China. According to the arrangement between Mainland China and Hong Kong Special Administrative Region on the Avoidance of Double Taxation and Prevention of Fiscal Evasion in August 2006, dividends paid by a FIE in China to its immediate holding company in Hong Kong will be subject to withholding tax at a rate that may be lowered to 5% (if the foreign investor owns directly at least 25% of the shares of the FIE). The State Administration of Taxation (“SAT”) further promulgated Circular 601 on October 27, 2009, which provides that tax treaty benefits will be denied to “conduit” or shell companies without business substance and that a beneficial ownership analysis will be used based on a “substance-over-form” principle to determine whether or not to grant the tax treaty benefits. Further, the SAT promulgated the Notice on Issues Related to the “Beneficial Owner” in Tax Treaties in February 2018, which requires the “beneficial owner” to have ownership and the right to dispose of the income or the rights and properties giving rise to the income and generally engage in substantive business activities and sets forth certain detailed factors in determining the “beneficial owner” status.

To the extent that subsidiaries, VIEs and subsidiaries of the VIEs of the Group have undistributed earnings, the Company will accrue appropriate expected withholding tax associated with repatriation of such undistributed earnings. As of December 31, 2022 and 2023, the Company did not record any such withholding tax of its subsidiaries, the VIEs and subsidiaries of the VIEs in the PRC as they are still in accumulated deficit position.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480990/946-20-50-13

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//740/tableOfContent

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-14

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 21
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-21

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 270
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482526/740-270-50-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 17
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-17

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SAB TOPIC 6.I.5.Q1)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 30
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482603/740-30-50-2

+ Details

Cash and Cash Equivalents (Details) ¥ in Thousands, $ in Thousands	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)
Cash and cash equivalents:
Cash and cash equivalents	¥ 494,965	$ 69,700	¥ 568,192	¥ 533,293
RMB
Cash and cash equivalents:
Cash and cash equivalents	405,467		415,670
US
Cash and cash equivalents:
Cash and cash equivalents	81,253		149,227
Others
Cash and cash equivalents:
Cash and cash equivalents	¥ 8,245		¥ 3,295

Organization and Principal Activities (Tables)

12 Months Ended

Dec. 31, 2023

Organization and Principal Activities

Schedule of Major Subsidiaries Consolidated Vies and Vies Subsidiaries

As of December 31, 2023, the Company’s consolidated subsidiaries, the VIEs and subsidiaries of the VIEs are as follows:


		Percentage of
	Place and	direct or indirect
	year of	economic ownership
Major Subsidiaries	incorporation	%	Principal activities
Lizhi Inc. (“Lizhi BVI”)	British Virgin Islands, Y2010	100	Investment holding
Lizhi Holding Limited (“Lizhi HK”)	Hong Kong, China Y2010	100	Investment holding
Beijing Hongyiyichuang Information Technology Co., Ltd. (“Hongyi Technology”)	Beijing, China Y2011	100	Technical support and consulting services, advertising service
Tiya Inc. (“Tiya Cayman”)	Cayman Islands, Y2019	100	Investment holding
VOCAL BEATS Inc. (“Vocal Beats”)	British Virgin Islands, Y2019	68.5	Investment holding
TIYA INC. (“Tiya BVI”)	British Virgin Islands, Y2019	100	Investment holding
Tiya Holding Limited (“Tiya HK”)	Hong Kong, China Y2019	100	Investment holding
TIYA PTE. LTD.	Singapore Y2019	100	Social Networking and others
NASHOR PTE. LTD.	Singapore Y2019	68.5	Social Networking and others
Vocalbeats CO., LTD. (Formerly known as TIYA CO., LTD.)	Japan Y2022	68.5	Social Networking and others
FUNAGE FZ-LLC	UAE Y2022	68.5	Social Networking and others
SONICO SDN. BHD.	Malaysia Y2022	68.5	Technical support and consulting services
Guangzhou Tiya Information Technology Co., Ltd. (“Guangzhou Tiya”)	Guangzhou, China Y2019	100	Technical support and consulting services
Tiya Inc. (“Tiya USA”)	USA Y2020	100	Social Networking and others
Guangzhou QingYin Information Technology Co., Ltd. (“Guangzhou QingYin”)	Guangzhou, China Y2022	100	Technical support and consulting services
Guangzhou Yuyin Information Technology Co., Ltd.	Guangzhou, China Y2022	68.5	Technical support and consulting services
Guangzhou Yuechuang Information Technology Co., Ltd.	Guangzhou, China Y2022	100	Technical support and consulting services



	Place and	Percentage of
	year of	direct or indirect
	incorporation/	economic ownership
Major VIEs	acquisition	%	Principal activities
Guangzhou Lizhi Network Technology Co., Ltd. (“Guangzhou Lizhi”)	Guangzhou, China Y2007	100	Audio entertainment and podcast business
Guangzhou Huanliao Network Technology Co., Ltd. (“Guangzhou Huanliao”)	Guangzhou, China Y2016	100	Audio entertainment business and others


		Percentage of
	Place and	direct or indirect
	year of	economic ownership
Major subsidiaries of VIEs	incorporation	%	Principal activities
Wuhan Lizhi Network Technology Co., Ltd.	Wuhan, China Y2017	100	Audio entertainment business and others
Wuhan Yuyinliaorao Network Technology Co., Ltd.	Wuhan, China Y2019	100	Audio entertainment business and others
Beijing Guoyin Network Technology Co., Ltd.	Beijing, China Y2020	100	Technical support and consulting services
Hainan Kuangyin Network Technology Co., Ltd.	Hainan, China Y2021	100	Technical support and consulting services

Schedule of Variable Interest Entities

The following combined financial information of the VIEs as of December 31, 2022 and 2023 and for the years ended December 31, 2021, 2022 and 2023 was included in the accompanying consolidated financial statements of the Group as follows:


	As of December 31,	As of December 31,
	2022	2023
	RMB	RMB
ASSETS
Current assets:
Cash and cash equivalents	302,103	168,694
Restricted cash	—	—
Accounts receivable, net	902	922
Prepayments and other current assets	21,365	19,261
Amount due from the subsidiaries of the Group	781	36,484
Total current assets	325,151	225,361
Non-current assets:
Property, equipment and leasehold improvement, net	18,390	10,726
Intangible assets, net	1,104	1,314
Right-of-use assets, net	7,087	885
Total non-current assets	26,581	12,925
TOTAL ASSETS	351,732	238,286
Current liabilities:
Accounts payable	50,735	40,066
Deferred revenue	27,718	25,389
Salary and welfare payable	120,563	113,320
Taxes payable	4,112	2,784
Short-term loans	66,800	—
Lease liabilities due within one year	7,021	632
Accrued expenses and other current liabilities	42,770	32,352
Amount due to the subsidiaries of the Group	379,306	394,482
Total current liabilities	699,025	609,025
Non-current liabilities:
Lease liabilities	160	255
Total non-current liabilities	160	255
TOTAL LIABILITIES	699,185	609,280


	For the year ended
	December 31,	December 31,	December 31,
	2021	2022	2023
	RMB	RMB	RMB
Net revenues	1,975,758	2,155,620	2,069,491
Net (loss)/income	(81,551)	106,188	(23,554)


	For the year ended
	December 31,	December 31,	December 31,
	2021	2022	2023
	RMB	RMB	RMB
Net cash (used in)/generated from operating activities	(17,723)	147,067	(25,170)
Net cash generated from/(used in) investing activities	52,323	(5,576)	(2,181)
Net cash generated from/(used in) financing activities	7,298	(33,960)	(106,058)
Net increase/(decrease) in cash, cash equivalents and restricted cash	41,898	107,531	(133,409)

- Definition

Tabular disclosure of the significant judgments and assumptions made in determining whether a variable interest (as defined) held by the entity requires the variable interest entity (VIE) (as defined) to be consolidated and (or) disclose information about its involvement with the VIE, individually or in aggregate (as applicable); the nature of restrictions, if any, on the consolidated VIE's assets and on the settlement of its liabilities reported by an entity in its statement of financial position, including the carrying amounts of such assets and liabilities; the nature of, and changes in, the risks associated with involvement in the VIE; how involvement with the VIE affects the entity's financial position, financial performance, and cash flows; the lack of recourse if creditors (or beneficial interest holders) of the consolidated VIE have no recourse to the general credit of the primary beneficiary (if applicable); the terms of arrangements, giving consideration to both explicit arrangements and implicit variable interests, if any, that could require the entity to provide financial support to the VIE, including events or circumstances that could expose the entity to a loss; the methodology used by the entity for determining whether or not it is the primary beneficiary of the variable interest entity; the significant factors considered and judgments made in determining that the power to direct the activities of a VIE that most significantly impact the VIE's economic performance are shared (as defined); the carrying amounts and classification of assets and liabilities of the VIE included in the statement of financial position; the entity's maximum exposure to loss, if any, as a result of its involvement with the VIE, including how the maximum exposure is determined and significant sources of the entity's exposure to the VIE; a comparison of the carrying amounts of the assets and liabilities and the entity's maximum exposure to loss; information about any liquidity arrangements, guarantees, and (or) other commitments by third parties that may affect the fair value or risk of the entity's variable interest in the VIE; whether or not the entity has provided financial support or other support (explicitly or implicitly) to the VIE that it was not previously contractually required to provide or whether the entity intends to provide that support, including the type and amount of the support and the primary reasons for providing the support; and supplemental information the entity determines necessary to provide.

+ References + Details

Subsequent Events

12 Months Ended

Dec. 31, 2023

Subsequent Events

Subsequent Events

21.Subsequent Events

In March 2024, the Company encountered difficulties obtaining response from a third-party financial institution (the “Financial Institution”) which the Company had US$12.8 million deposit (the “Relevant Deposit”) remaining. Thereafter, the Company had difficulties withdrawing the Relevant Deposit from the Financial Institution (the “Incident”). To gain a comprehensive understanding of the Incident and facilitate the audit procedure, the audit committee engaged a reputable accounting firm which is not the Company’s auditor to perform an independent investigation on the Incident (the “Investigation”), which was completed in October 2024.

Given the results of above investigation and the evaluation by the management, the Company considered that the Relevant Deposit was subject to a risk of default. Consequently, the Company had recorded an allowance of provision for credit loss amounting to RMB90.7 million (US$12.8 million) for the Relevant Deposit in the consolidated statements of operations and comprehensive (loss)/income for the year ended December 31, 2023.

Cash and Cash Equivalents

12 Months Ended

Dec. 31, 2023

Cash and Cash Equivalents

Cash and Cash Equivalents

3.Cash and Cash Equivalents

Cash and cash equivalents represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with original maturities of three months or less. Cash and cash equivalents balance as of December 31, 2022 and 2023 primarily consist of the following currencies:


	December 31, 2022	December 31, 2023
	RMB	RMB
Cash and cash equivalents:
RMB	415,670	405,467
US$	149,227	81,253
Others	3,295	8,245
Total cash and cash equivalents	568,192	494,965

Fair Value Measurement - Summary of fair value, assets and liabilities measured on recurring basis (Details) - Dec. 31, 2023 - Recurring ¥ in Thousands, $ in Thousands	CNY (¥)	USD ($)
Fair value of net assets
Short-term investments	¥ 111,353	$ 16,145
Total	111,353	$ 16,145
Significant Other Observable Inputs (Level 2)
Fair value of net assets
Short-term investments	111,353
Total	¥ 111,353

Organization and Principal Activities - Summary of Major Subsidiaries Consolidated Vies and Vies Subsidiaries (Details)	12 Months Ended
	Dec. 31, 2023
Organization and Reorganization
Place and year of incorporation	incorporation
Principal activities	Principal activities
Guangzhou Lizhi Network Technology Co., Ltd ("Guangzhou Lizhi")
Organization and Reorganization
Place and year of incorporation	Guangzhou, China Y2007
Principal activities	Audio entertainment and podcast business
Percentage of direct or indirect economic ownership	100.00%
Guangzhou Huanliao Network Technology Co., Ltd. ("Guangzhou Huanliao")
Organization and Reorganization
Place and year of incorporation	Guangzhou, China Y2016
Principal activities	Audio entertainment business and others
Percentage of direct or indirect economic ownership	100.00%
Wuhan Lizhi Network Technology Co., Ltd
Organization and Reorganization
Place and year of incorporation	Wuhan, China Y2017
Principal activities	Audio entertainment business and others
Percentage of direct or indirect economic ownership	100.00%
Wuhan Yuyinliaorao Network Technology Co., Ltd
Organization and Reorganization
Place and year of incorporation	Wuhan, China Y2019
Principal activities	Audio entertainment business and others
Percentage of direct or indirect economic ownership	100.00%
Beijing Guoyin Network Technology Co., Ltd.
Organization and Reorganization
Place and year of incorporation	Beijing, China Y2020
Principal activities	Technical support and consulting services
Percentage of direct or indirect economic ownership	100.00%
Hainan Kuangyin Network Technology Co., Ltd.
Organization and Reorganization
Place and year of incorporation	Hainan, China Y2021
Principal activities	Technical support and consulting services
Percentage of direct or indirect economic ownership	100.00%
Lizhi Inc. ("Lizhi BVI")
Organization and Reorganization
Place and year of incorporation	British Virgin Islands, Y2010
Principal activities	Investment holding
Percentage of direct or indirect economic ownership	100.00%
Lizhi Holding Limited ("Lizhi HK")
Organization and Reorganization
Place and year of incorporation	Hong Kong, China Y2010
Principal activities	Investment holding
Percentage of direct or indirect economic ownership	100.00%
Beijing Hongyiyichuang Information Technology Co., Ltd ("Hongyi Technology")
Organization and Reorganization
Place and year of incorporation	Beijing, China Y2011
Principal activities	Technical support and consulting services, advertising service
Percentage of direct or indirect economic ownership	100.00%
Tiya Inc. ("Tiya Cayman")
Organization and Reorganization
Place and year of incorporation	Cayman Islands, Y2019
Principal activities	Investment holding
Percentage of direct or indirect economic ownership	100.00%
VOCAL BEATS Inc. ("Vocal Beats")
Organization and Reorganization
Place and year of incorporation	British Virgin Islands, Y2019
Principal activities	Investment holding
Percentage of direct or indirect economic ownership	68.50%
TIYA INC ("Tiya BVI")
Organization and Reorganization
Place and year of incorporation	British Virgin Islands, Y2019
Principal activities	Investment holding
Percentage of direct or indirect economic ownership	100.00%
Tiya Holding Limited ("Tiya HK")
Organization and Reorganization
Place and year of incorporation	Hong Kong, China Y2019
Principal activities	Investment holding
Percentage of direct or indirect economic ownership	100.00%
TIYA PTE. LTD.
Organization and Reorganization
Place and year of incorporation	Singapore Y2019
Principal activities	Social Networking and others
Percentage of direct or indirect economic ownership	100.00%
NASHOR PTE. LTD.
Organization and Reorganization
Place and year of incorporation	Singapore Y2019
Principal activities	Social Networking and others
Percentage of direct or indirect economic ownership	68.50%
Vocalbeats CO., LTD. (Formerly known as TIYA CO., LTD.)
Organization and Reorganization
Place and year of incorporation	Japan Y2022
Principal activities	Social Networking and others
Percentage of direct or indirect economic ownership	68.50%
FUNAGE FZ-LLC
Organization and Reorganization
Place and year of incorporation	UAE Y2022
Principal activities	Social Networking and others
Percentage of direct or indirect economic ownership	68.50%
SONICO SDN. BHD.
Organization and Reorganization
Place and year of incorporation	Malaysia Y2022
Principal activities	Technical support and consulting services
Percentage of direct or indirect economic ownership	68.50%
Guangzhou Tiya Information Technology Co., Ltd. ("Guangzhou Tiya")
Organization and Reorganization
Place and year of incorporation	Guangzhou, China Y2019
Principal activities	Technical support and consulting services
Percentage of direct or indirect economic ownership	100.00%
Tiya Inc. ("Tiya USA")
Organization and Reorganization
Place and year of incorporation	USA Y2020
Principal activities	Social Networking and others
Percentage of direct or indirect economic ownership	100.00%
Guangzhou QingYin Information Technology Co., Ltd. ("Guangzhou QingYin")
Organization and Reorganization
Place and year of incorporation	Guangzhou, China Y2022
Principal activities	Technical support and consulting services
Percentage of direct or indirect economic ownership	100.00%
Guangzhou Yuyin Information Technology Co., Ltd.
Organization and Reorganization
Place and year of incorporation	Guangzhou, China Y2022
Principal activities	Technical support and consulting services
Percentage of direct or indirect economic ownership	68.50%
Guangzhou Yuechuang Information Technology Co., Ltd.
Organization and Reorganization
Place and year of incorporation	Guangzhou, China Y2022
Principal activities	Technical support and consulting services
Percentage of direct or indirect economic ownership	100.00%

Leases - Summary of Lessee Operating Lease Liability Maturity (Details) - CNY (¥) ¥ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Leases
2024	¥ 10,838
2025	3,150
2026	898
Total future lease payment	14,886
Impact of discounting remaining lease payments	(599)
Total lease liabilities	14,287	¥ 26,567
Operating leases not yet commenced	¥ 0	¥ 0

Property, Equipment and Leasehold Improvement, Net (Tables)

12 Months Ended

Dec. 31, 2023

Property, Equipment and Leasehold Improvement, Net

Summary of property, equipment and leasehold improvement, net


	December 31,	December 31,
	2022	2023
	RMB	RMB
Electronic equipment	80,099	79,432
Furniture and office equipment	3,273	2,890
Vehicles	2,818	294
Leasehold improvement	15,407	17,373
Total property, equipment and leasehold improvement	101,597	99,989
Less: accumulated depreciation	(75,051)	(82,701)
Property, equipment and leasehold improvement, net	26,546	17,288

Net (Loss)/Income per Share (Tables)

12 Months Ended

Dec. 31, 2023

Net (Loss)/Income per Share

Summary of antidilutive securities excluded from computation of earnings per share


	For the year ended December 31,
	2021	2022	2023
Share options	7,036,117	—	—
Restricted shares	5,680,877	—	—
Restricted share units	2,462,618	—	—
Total	15,179,612	—	—

Summary of computation of basic and diluted net (loss)/income per share


	For the year ended December 31,
	2021	2022	2023
	RMB	RMB	RMB
Numerator:
Net (loss)/income	(127,250)	86,504	(134,515)
Less: accretions to preferred shares redemption value	—	—	—
Less: net loss attributable to the non-controlling interest shareholders	—	(13)	(7,864)
Net (loss)/income attributable to Sound Group Inc.’s ordinary shareholders	(127,250)	86,517	(126,651)

Denominator:
Weighted average number of ordinary shares outstanding, basic	991,715,849	1,036,485,949	1,078,969,851
Add:
Share options	—	852,691	—
Restricted shares	—	1,279,270	—
Weighted average number of ordinary shares outstanding, diluted	991,715,849	1,038,617,910	1,078,969,851

Basic net (loss)/income per share attributable to Sound Group Inc.’s ordinary shareholders	(0.13)	0.08	(0.12)
Diluted net (loss)/income per share attributable to Sound Group Inc.’s ordinary shareholders	(0.13)	0.08	(0.12)

ADDITIONAL INFORMATION: CONDENSED FINANCIAL STATEMENTS OF PARENT COMPANY

12 Months Ended

Dec. 31, 2023

ADDITIONAL INFORMATION: CONDENSED FINANCIAL STATEMENTS OF PARENT COMPANY

ADDITIONAL INFORMATION: CONDENSED FINANCIAL STATEMENTS OF PARENT COMPANY

ADDITIONAL INFORMATION: CONDENSED FINANCIAL STATEMENTS OF PARENT COMPANY

Rules 12-04(a) and 4-08(e)(3) of Regulation S-X require condensed financial information as to the financial position, cash flows and results of operations of a parent company as of and for the same periods for which the audited consolidated financial statements have been presented when the restricted net assets of the consolidated subsidiaries together exceed 25% of consolidated net assets as of the end of the most recently completed fiscal year.

The following condensed financial statements of the Company have been prepared using the same accounting policies as set out in the Company’s consolidated financial statements except that the Company used the equity method to account for its investment in its subsidiaries. Such investment is presented on the separate condensed balance sheets of the Company as “Deficit in subsidiaries”. The Company, its subsidiaries, the VIEs and the VIEs’ subsidiaries were included in the consolidated financial statements whereby the inter-company balances and transactions were eliminated upon consolidation. The Company’s (loss)/income from its subsidiaries is reported as “(Loss)/income from subsidiaries” in the condensed financial statements.

ADDITIONAL INFORMATION: CONDENSED FINANCIAL STATEMENTS OF PARENT COMPANY (CONTINUED)

As of December 31, 2022 and 2023, there were no material commitments or contingencies, significant provisions for long-term obligations or guarantees of the Company.


CONDENSED BALANCE SHEETS AS OF DECEMBER 31, 2022 AND 2023
	As of December 31,
	2022	2023
	RMB	RMB

ASSETS
Current assets:
Cash and cash equivalents	93,673	70,544
Short-term investments	91,339	—
Amounts due from Sound Group Companies	359,675	471,614
Prepayments and other current assets	2,313	1,697
Total current assets	547,000	543,855
Non-current assets:
Deficit in subsidiaries	(130,257)	(149,402)
Total non-current assets	(130,257)	(149,402)
TOTAL ASSETS	416,743	394,453
LIABILITIES
Current liabilities:
Salary and welfare payable	2,487	2,066
Accrued expenses and other current liabilities	1,683	13,016
Amounts due to Sound Group Companies	15,944	79,896
Total current liabilities	20,114	94,978

Non-current liabilities:
Other non-current liabilities	3,952	—
Total non-current liabilities	3,952	—
TOTAL LIABILITIES	24,066	94,978

SHAREHOLDERS’ EQUITY:
Class A Ordinary shares (US$0.0001 par value, 1,268,785,000 shares authorized, 818,962,260 shares issued and 803,607,050 shares outstanding as of December 31, 2022; 1,268,785,000 shares authorized, 838,962,260 shares issued and 819,084,610 shares outstanding as of December 31, 2023).	543	557
Class B Ordinary shares (US$0.0001 par value, 231,215,000 shares authorized, issued and outstanding as of December 31, 2022 and December 31, 2023, respectively).	168	168
Treasury stock	(10)	(958)
Other shareholders’ equity	391,976	299,708
TOTAL Sound Group Inc.’s SHAREHOLDERS’ EQUITY	392,677	299,475
TOTAL LIABILITIES AND Sound Group Inc.’s SHAREHOLDERS’ EQUITY	416,743	394,453

ADDITIONAL INFORMATION: CONDENSED FINANCIAL STATEMENTS OF PARENT COMPANY (CONTINUED)


CONDENSED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME FOR THE YEARS ENDED DECEMBER 31, 2021, 2022 and 2023
	For the year ended December 31,
	2021	2022	2023
	RMB	RMB	RMB

Total Operating expenses	(19,010)	(15,966)	(107,380)

Other expenses:
(Loss)/income from subsidiaries	(109,046)	100,300	(14,852)
Others, net	806	2,183	(4,419)
Net (loss)/income	(127,250)	86,517	(126,651)
Net (loss)/income attributable to the Sound Group Inc.’s ordinary shareholders	(127,250)	86,517	(126,651)
Net (loss)/income	(127,250)	86,517	(126,651)
Other comprehensive (loss)/income:
Foreign currency translation adjustments	(7,848)	24,314	3,366
Total other comprehensive (loss)/income	(7,848)	24,314	3,366
Total comprehensive (loss)/income to the Sound Group Inc.’s ordinary shareholders	(135,098)	110,831	(123,285)


CONDENSED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2021, 2022 and 2023
	For the year ended December 31,
	2021	2022	2023
	RMB	RMB	RMB

Net cash used in operating activities	(15,728)	(11,752)	(103,250)

Net cash used in investing activities
Cash paid for investments in subsidiaries	(83,661)	(50,204)	(114,911)
Other investing activities	—	(91,022)	91,022
Cash repayment from Group companies	—	3,677	21,466
Net cash used in investing activities	(83,661)	(137,549)	(2,423)

Net cash generated from financing activities
Capital contribution and loans received from Group companies	—	—	80,000
Proceeds from issuance of ordinary shares	183,188	—	—
Proceeds from exercise of vested share options	3	5	5
Net cash generated from financing activities	183,191	5	80,005


Effect of exchange rate changes on cash and cash equivalents	(4,291)	18,190	2,539

Net increase/(decrease) in cash and cash equivalents	79,511	(131,106)	(23,129)
Cash and cash equivalents at beginning of the year	145,268	224,779	93,673
Cash and cash equivalents at end of the year	224,779	93,673	70,544

Property, Equipment and Leasehold Improvement, Net

12 Months Ended

Dec. 31, 2023

Property, Equipment and Leasehold Improvement, Net

Property, Equipment and Leasehold Improvement, Net

6.Property, Equipment and Leasehold Improvement, Net

The following is a summary of property, equipment and leasehold improvement, net:


	December 31,	December 31,
	2022	2023
	RMB	RMB
Electronic equipment	80,099	79,432
Furniture and office equipment	3,273	2,890
Vehicles	2,818	294
Leasehold improvement	15,407	17,373
Total property, equipment and leasehold improvement	101,597	99,989
Less: accumulated depreciation	(75,051)	(82,701)
Property, equipment and leasehold improvement, net	26,546	17,288

Depreciation expenses were RMB19.2 million, RMB18.1 million and RMB13.2 million for the years ended December 31, 2021, 2022 and 2023, respectively. No impairment charge was recognized for any of the years presented.

Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2023

Significant Accounting Policies

Schedule of property, equipment and leasehold improvement


Electronic equipment		3 years
Furniture and office equipment		5 years
Vehicles		4 years
Leasehold improvement		shorter of expected lives of leasehold improvement and lease term

Schedule of amortization of finite-lived intangible assets


Copyright		1-3 years
Software		1-5 years
Trademark and others		3-5 years

Summary of the revenue by type of service provided by the Group


	For the year ended December 31,
	2021	2022	2023
	RMB	RMB	RMB
Audio entertainment	2,101,475	2,174,314	2,063,346
Podcast, advertising and others	18,039	10,952	8,426
Total	2,119,514	2,185,266	2,071,772

Advertising and promotional service providers

Significant Accounting Policies

Schedule of advertising and promotional service providers


	For the year ended December 31,
	2021		2022		2023
Total number of advertising and promotional service providers	198		182		121
Number of service providers that each accounted for 10% or more of the Group’s advertising and promotional expenses	2		2		3
Total percentage of the Group’s advertising and promotional expenses that were paid to these service providers who each accounted for 10% or more of the Group’s advertising and promotional service expenses	44.9	%	35.7	%	59.4	%

Major customers for advertising business

Significant Accounting Policies

Schedule of advertising and promotional service providers


	December 31,		December 31,
	2022		2023
Customer A	71.6	%	69.9	%
Customer B	27.8	%	0.0	%
Customer C	0.0	%	30.1	%

Significant Accounting Policies - Summary of Finite Lived Intangible Assets Useful Lives (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Intangible Assets
Impairment charge	$ 0	$ 0	$ 0
Copyright \| Minimum
Intangible Assets
Finite-lived intangible asset, useful life	1 year
Copyright \| Maximum
Intangible Assets
Finite-lived intangible asset, useful life	3 years
Software \| Minimum
Intangible Assets
Finite-lived intangible asset, useful life	1 year
Software \| Maximum
Intangible Assets
Finite-lived intangible asset, useful life	5 years
Trademark and others \| Minimum
Intangible Assets
Finite-lived intangible asset, useful life	3 years
Trademark and others \| Maximum
Intangible Assets
Finite-lived intangible asset, useful life	5 years

Leases - Summary of Information Related To Operating Leases (Details) ¥ in Thousands, $ in Thousands	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)
Leases
Operating lease ROU assets	¥ 13,990	$ 1,970	¥ 25,116
Operating lease liabilities-non-current	(3,936)	(554)	(8,195)
Operating lease liabilities-current	(10,351)	$ (1,458)	(18,372)
Total operating lease liabilities	¥ (14,287)		¥ (26,567)
Weighted average remaining lease term	1 year 6 months	1 year 6 months	1 year 8 months 12 days
Weighted average discount rate	5.70%	5.70%	6.30%

Commitments and Contingencies

12 Months Ended

Dec. 31, 2023

Commitments and Contingencies.

Commitments and Contingencies

16.Commitments and Contingencies

Lease commitments

The Group’s lease commitments consist of commitments under the lease agreements for the Group’s office facilities, staff quarters and other operating related facilities. As of December 31, 2023, the total amount of future lease payments under operating leases was RMB27.8 million, of which RMB23.7 million is with one year and the remaining RMB4.1 million is more than one year and less than three years.

Litigation

From time to time, the Group is involved in claims and legal proceedings that arise in the ordinary course of business. The Group records a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. The Group reviews the need for any such liability on a regular basis. See Note 11 for additional information of such liabilities recorded.

Based on currently available information, management does not believe that the ultimate outcome of any unresolved matters, individually and in the aggregate, is reasonably possible to have a material adverse effect on the Group’s financial position, results of operations or cash flows beyond the amounts already reflected in the accompanying financial statements, however, litigation is subject to inherent uncertainties and the Group’s view of these matters may change in the future.

CONSOLIDATED BALANCE SHEETS (Parenthetical) ¥ in Thousands, $ in Thousands	Dec. 31, 2023 CNY (¥) shares	Dec. 31, 2022 CNY (¥) shares
Liabilities	¥ 276,561	¥ 383,673
Ordinary shares, shares authorized	1,500,000,000
Class A ordinary shares
Ordinary shares, shares authorized	1,268,785,000	1,268,785,000
Ordinary shares, shares issued	838,962,260	818,962,260
Ordinary shares, shares outstanding	819,084,610	803,607,050
Class B ordinary shares
Ordinary shares, shares authorized	231,215,000	231,215,000
Ordinary shares, shares issued	231,215,000	231,215,000
Ordinary shares, shares outstanding	231,215,000	231,215,000
VIEs without recourse to the primary beneficiary
Liabilities \| ¥	¥ 214,800	¥ 319,900

- Definition

Sum of the carrying amounts as of the balance sheet date of all liabilities that are recognized. Liabilities are probable future sacrifices of economic benefits arising from present obligations of an entity to transfer assets or provide services to other entities in the future.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 810
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481203/810-10-50-3

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 810
-SubTopic 10
-Name Accounting Standards Codification
-Section 45
-Paragraph 25
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481231/810-10-45-25

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 810
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (bb)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481203/810-10-50-3

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(g)(1)(ii))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 323
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481687/323-10-50-3

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 825
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 28
-Subparagraph (f)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482907/825-10-50-28

Reference 7: http://www.xbrl.org/2003/role/exampleRef
-Topic 946
-SubTopic 830
-Name Accounting Standards Codification
-Section 55
-Paragraph 12
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480167/946-830-55-12

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 210
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.6-04(14))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479617/946-210-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(i))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1A

Reference 10: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(ii))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1A

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iii)(A))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1A

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iv))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1A

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(5))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1A

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(i))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1B

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(A))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1B

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(B))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1B

Reference 17: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iv))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1B

Reference 18: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(5))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1B

Reference 19: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 852
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 7
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481404/852-10-50-7

Reference 20: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 852
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 7
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481404/852-10-50-7

Reference 21: http://www.xbrl.org/2003/role/exampleRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 30
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-30

Reference 22: http://fasb.org/us-gaap/role/ref/legacyRef
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.19-26)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480566/210-10-S99-1

+ Details

Significant Accounting Policies - Summary of Major Customers for Advertising Business (Details) - Major customers for advertising business - Customer concentration risk - customer	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Advertising and promotional service providers
Number of customers	2	2
Customer A
Advertising and promotional service providers
Concentration risk (as a percentage)	69.90%	71.60%
Customer B
Advertising and promotional service providers
Concentration risk (as a percentage)	0.00%	27.80%
Customer C
Advertising and promotional service providers
Concentration risk (as a percentage)	30.10%	0.00%

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥) ¥ / shares shares	Dec. 31, 2023 USD ($) $ / shares shares	Dec. 31, 2022 CNY (¥) ¥ / shares shares	Dec. 31, 2021 CNY (¥) ¥ / shares shares
Net revenues	¥ 2,071,772	$ 291,803	¥ 2,185,266	¥ 2,119,514
Cost of revenues	(1,486,397)	(209,355)	(1,468,921)	(1,502,505)
Gross profit	585,375	82,448	716,345	617,009
Operating expenses:
Selling and marketing expenses	(237,646)	(33,472)	(259,618)	(386,204)
General and administrative expenses	(193,907)	(27,311)	(106,727)	(104,617)
Research and development expenses	(301,490)	(42,464)	(283,349)	(264,706)
Total operating expenses	(733,043)	(103,247)	(649,694)	(755,527)
Operating (loss)/income	(147,668)	(20,799)	66,651	(138,518)
Other income/(loss):
Interest expenses	(1,563)	(220)	(2,474)	(2,904)
Foreign exchange losses	(1,488)	(210)	(1,052)	(738)
Interest income and investment income	10,820	1,524	7,282	2,269
Government grants	9,395	1,323	14,360	13,496
Others, net	(3,577)	(504)	1,944	(479)
(Loss)/income before income taxes	(134,081)	(18,886)	86,711	(126,874)
Income tax expenses	(434)	(61)	(207)	(376)
Net (loss)/income	(134,515)	(18,947)	86,504	(127,250)
Net loss attributable to the non-controlling interests shareholders	7,864	1,108	13
Net (loss)/income attributable to the Sound Group Inc.'s ordinary shareholders	(126,651)	(17,839)	86,517	(127,250)
Net (loss)/income	(134,515)	(18,947)	86,504	(127,250)
Other comprehensive (loss)/income:
Foreign currency translation adjustments	3,277	462	24,314	(7,848)
Total other comprehensive (loss)/income	3,277	462	24,314	(7,848)
Total comprehensive (loss)/income	(131,238)	(18,485)	110,818	(135,098)
Comprehensive loss attributable to the non-controlling interests shareholders	7,953	1,120	13
Comprehensive (loss)/income attributable to the Sound Group Inc.'s ordinary shareholders	¥ (123,285)	$ (17,365)	¥ 110,831	¥ (135,098)
Net (loss)/income attributable to the Sound Group Inc.'s ordinary shareholders per share
Basic \| (per share)	¥ (0.12)	$ (0.02)	¥ 0.08	¥ (0.13)
Diluted \| (per share)	¥ (0.12)	$ (0.02)	¥ 0.08	¥ (0.13)
Weighted average number of ordinary shares
Basic	1,078,969,851	1,078,969,851	1,036,485,949	991,715,849
Diluted	1,078,969,851	1,078,969,851	1,038,617,910	991,715,849
American Depositary Shares
Net (loss)/income attributable to the Sound Group Inc.'s ordinary shareholders per share
Basic \| (per share)	¥ (23.48)	$ (3.31)	¥ 16.69	¥ (25.66)
Diluted \| (per share)	¥ (23.48)	$ (3.31)	¥ 16.66	¥ (25.66)
Weighted average number of ordinary shares
Basic	5,394,849	5,394,849	5,182,430	4,958,579
Diluted	5,394,849	5,394,849	5,193,090	4,958,579

Significant Accounting Policies - Summary of Property Plant Equipment Estimated Useful Lives (Details)	Dec. 31, 2023
Electronic equipment
Property, Plant and Equipment
Property, Plant and Equipment, Useful Life	3 years
Furniture and office equipment
Property, Plant and Equipment
Property, Plant and Equipment, Useful Life	5 years
Vehicles
Property, Plant and Equipment
Property, Plant and Equipment, Useful Life	4 years

Cash and Cash Equivalents (Tables)

12 Months Ended

Dec. 31, 2023

Cash and Cash Equivalents

Summary of cash and cash equivalents


	December 31, 2022	December 31, 2023
	RMB	RMB
Cash and cash equivalents:
RMB	415,670	405,467
US$	149,227	81,253
Others	3,295	8,245
Total cash and cash equivalents	568,192	494,965

Taxation - Summary of Income Tax Reconciliation (Details)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Taxation
Statutory income tax rate of the PRC	25.00%	25.00%	25.00%
Tax rate difference from preferential tax treatments and statutory rate in other jurisdictions	(29.60%)	(0.10%)	(16.50%)
Effect of withholding taxes			(0.30%)
Permanent differences	25.40%	(33.40%)	26.60%
Change in valuation allowances	(21.20%)	8.70%	(35.20%)
Effective income tax rate	(0.40%)	0.20%	(0.40%)

Taxation (Tables)

12 Months Ended

Dec. 31, 2023

Taxation

Schedule of Income tax reconciliation


	For the year ended December 31,
	2021	2022	2023
	%	%	%
Statutory income tax rate of the PRC	25.0	25.0	25.0
Tax rate difference from preferential tax treatments and statutory rate in other jurisdictions	(16.5)	(0.1)	(29.6)
Effect of withholding taxes	(0.3)	—	—
Permanent differences⁽¹⁾	26.6	(33.4)	25.4
Change in valuation allowances	(35.2)	8.7	(21.2)
Effective income tax rate	(0.4)	0.2	(0.4)

(1)	The permanent differences mainly consist of additional super deduction for research and development expenditures, and certain non-deductible expenses.

Schedule of net operating tax loss carry forwards


		RMB

Loss expiring in 2024		14,186
Loss expiring in 2025		18,968
Loss expiring in 2026		42,858
Loss expiring in 2027		28,366
Loss expiring in 2028		69,256
Loss expiring in 2029		156,879
Loss expiring in 2030		156,066
Loss expiring in 2031		207,664
Loss expiring in 2032		14,027
Loss expiring in 2033		98,722
		806,992

Schedule of deferred tax assets


	December 31, 2022	December 31, 2023
	RMB	RMB
Deferred tax assets:
Net operating tax loss carry forwards	108,601	116,862
Advertising expenses in excess of deduction limit	—	1
Total deferred tax assets	108,601	116,863
Less: valuation allowances	(108,601)	(116,863)
Net deferred tax assets	—	—

Schedule of movement of the aggregate valuation allowances for deferred tax assets


	Balance at January 1	Movement*	Balance at December 31
	RMB	RMB	RMB
2021	(74,607)	(38,231)	(112,838)
2022	(112,838)	4,237	(108,601)
2023	(108,601)	(8,262)	(116,863)

*	The movement in valuation allowances were due to the changes of deferred tax assets recognized for net operating tax loss carry forwards, advertising expenses in excess of deduction limit and deferred revenue.

Accrued Expenses and Other Current Liabilities - Summary of Accrued Expenses And Other Current Liabilities (Details) - CNY (¥) ¥ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Accrued Expenses and Other Current Liabilities.
Advertising and promotional expenses	¥ 25,196	¥ 33,048
Professional service fees	11,759	5,237
Payable for property, equipment and leasehold improvement, net	329	871
Payable for share repurchase program	949
Payable for remuneration fee of ADR program	3,517
Accrued sales rebates for advertising business	467	1,360
Provision for litigation contingencies	2,403	3,156
Others	3,890	3,950
Total	¥ 48,510	¥ 47,622

Share-based Compensation - Share-based compensation expense (Details) ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)
Share-based Compensation
Total	¥ 26,755	$ 3,768	¥ 29,233	¥ 37,359
Cost of revenues
Share-based Compensation
Total	3,845	542	7,052	11,484
Selling and marketing expenses
Share-based Compensation
Total	2,012	283	2,259	3,431
General and administrative expenses
Share-based Compensation
Total	9,458	1,332	9,659	12,496
Research and development expenses
Share-based Compensation
Total	¥ 11,440	$ 1,611	¥ 10,263	¥ 9,948

Significant Accounting Policies - Summary of Advertising and Promotional Service Providers (Details) ¥ in Millions, $ in Millions	12 Months Ended
	Dec. 31, 2023 CNY (¥) item	Dec. 31, 2023 USD ($) item	Dec. 31, 2022 item	Dec. 31, 2021 item
Advertising and promotional service providers
Allowance for credit loss provision	¥ 90.7	$ 12.8
Advertising and promotional service expense
Advertising and promotional service providers
Number of service providers that accounted for 10% or more of the Group's advertising and promotional expenses	121	121	182	198
Advertising and promotional service expense \| Supplier concentration risk
Advertising and promotional service providers
Number of service providers that accounted for 10% or more of the Group's advertising and promotional expenses	3	3	2	2
Advertising and promotional service expense \| Customer concentration risk \| Major customers for advertising business
Advertising and promotional service providers
Total percentage of the Group's advertising and promotional expenses that were paid to these service providers who accounted for 10% or more of the Group's advertising and promotional service expenses	59.40%	59.40%	35.70%	44.90%

Cover Page - shares	12 Months Ended
Cover Page - shares	Dec. 31, 2023	Sep. 30, 2024
Document Information [Line Items]
Document Type	20-F
Document Registration Statement	false
Document Annual Report	true
Document Transition Report	false
Document Shell Company Report	false
Document Period End Date	Dec. 31, 2023
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Entity File Number	001-39177
Entity Registrant Name	Sound Group Inc.
Entity Incorporation, State or Country Code	E9
Entity Address, Address Line One	60 Anson Road,
Entity Address, Address Line Two	Mapletree Anson
Entity Address, Address Line Three	#09-01/02
Entity Address, Country	SG
Entity Address, Postal Zip Code	079914
Entity Common Stock, Shares Outstanding		985,095,010
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	No
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
ICFR Auditor Attestation Flag	false
Document Financial Statement Error Correction [Flag]	false
Document Accounting Standard	U.S. GAAP
Entity Shell Company	false
Auditor Name	Enrome LLP
Auditor Firm ID	6907
Auditor Location	Singapore
Entity Central Index Key	0001783407
Document Fiscal Period Focus	FY
Amendment Flag	false
American Depositary Shares
Document Information [Line Items]
Title of 12(b) Security	American depositary shares, each ADS represents two hundred (200) Class A ordinary shares, par value US$0.0001 per share
Trading Symbol	SOGP
Security Exchange Name	NASDAQ
Class A ordinary shares
Document Information [Line Items]
Title of 12(b) Security	Class A ordinary shares, par value US$0.0001 per share *
No Trading Symbol Flag	true
Security Exchange Name	NASDAQ
Business Contact
Document Information [Line Items]
Contact Personnel Name	Chengfang Lu
City Area Code	65
Local Phone Number	62021360
Entity Address, Address Line One	60 Anson Road
Entity Address, Address Line Two	Mapletree Anson
Entity Address, Address Line Three	#09-01/02
Entity Address, Country	SG
Entity Address, Postal Zip Code	079914
Contact Personnel Email Address	erris.lu@soundgroupinc.com

Share-based Compensation

12 Months Ended

Dec. 31, 2023

Share-based Compensation

Share-based Compensation

14.Share-based Compensation

(a)Description of stock incentive plan

2018 Incentive Plan

In September 2018 and April 2019, the Group permitted the grant of options and restricted shares of the Company to relevant directors, officers, other employees and consultants of the Company (the “2018 Incentive Plan”). Option awards are granted with an exercise price determined by the Board of Directors. Those options and restricted shares awards generally vest over a period of four years.

2019 Incentive Plan and related amendments

On May 31, 2019, the Board of Directors of the Company approved the 2019 Share Incentive Plan (the “2019 Incentive Plan”) whereby the incentive share options and restricted shares granted to employees and non-employees by Lizhi BVI in the 2018 Incentive Plan shall be replaced and superseded by the exact number of share options and restricted shares of the Company for each grantee (the “2019 Replacement”). There is no change of fair value, vesting schedule and other key terms of such award agreements entered into with each grantee and the classification of share-based awards immediately before and after the 2019 Replacement, thus, the 2019 Replacement was not considered a modification of share-based awards.

On March 18, 2020, the 2019 Incentive Plan was further amended and restated, to increase the maximum aggregate number of Class A ordinary shares authorized to issue from 40,000,000 to 100,000,000 (the “Amended and Restated 2019 Share Incentive Plan”). On September 17, 2021, the Second Amended and Restated 2019 Share Incentive Plan was adopted to replace the Amended and Restated 2019 Share Incentive Plan in its entirety, increasing the maximum aggregate number of Class A ordinary shares authorized to issue from 100,000,000 to 170,000,000.

14.Share-based Compensation (Continued)

(a)Description of stock incentive plan (Continued)

Share-based compensation recognized for the years ended December 31, 2021, 2022 and 2023 is as follows:


	For the year ended December 31,
	2021	2022	2023	2023
	RMB	RMB	RMB	US$
Cost of revenues	11,484	7,052	3,845	542
Selling and marketing expenses	3,431	2,259	2,012	283
General and administrative expenses	12,496	9,659	9,458	1,332
Research and development expenses	9,948	10,263	11,440	1,611
Total	37,359	29,233	26,755	3,768

As of December 31, 2022 and 2023, total unrecognized compensation expenses related to unvested awards granted under the Second Amended and Restated 2019 Share Incentive Plan were RMB62.5 million and RMB26.5 million (US$3.8 million), respectively. As of December 31, 2022 and 2023, the weighted average remaining vesting period for share-based awards were 2.93 and 2.16 years, respectively.

During the years ended December 31, 2021, 2022 and 2023, there was no cash settled equity instrument granted under share-based payment arrangements, and no compensation cost for share-based payment arrangements was capitalized as part of the cost of an asset.

14.Share-based Compensation (Continued)

(b)

Stock options activities

The following table presents a summary of the Company’s stock options activities for the years ended December 31, 2021, 2022 and 2023.



				Weighted average	Remaining	Aggregated
	Employees	Consultants	Total	exercise price	contractual life	intrinsic value
	(in thousands)	(in thousands)	(in thousands)	US$		RMB

Outstanding at January 1, 2021	37,804	863	38,667	0.0001	3.09	48,921
Granted	32,389	—	32,389	0.0001	—	—
Exercised	(4,925)	—	(4,925)	0.0001	—	—
Forfeited	(15,571)	—	(15,571)	0.0001	—	—
Outstanding at December 31, 2021	49,697	863	50,560	0.0001	2.56	29,786
Exercisable as of December 31, 2021	8,216	341	8,557	0.0001	—	5,041

Outstanding at January 1, 2022	49,697	863	50,560	0.0001	2.56	29,786
Granted	24,924	—	24,924	0.0001	—	—
Exercised	(7,894)	—	(7,894)	0.0001	—	—
Forfeited	(6,076)	—	(6,076)	0.0001	—	—
Outstanding at December 31, 2022	60,651	863	61,514	0.0001	2.98	13,452
Exercisable as of December 31, 2022	16,421	682	17,103	0.0001	—	3,740

Outstanding at January 1, 2023	60,651	863	61,514	0.0001	2.98	13,452
Granted	15,593	—	15,593	0.0001	—	—
Exercised	(4,632)	—	(4,632)	0.0001	—	—
Forfeited	(326)	—	(326)	0.0001	—	—
Outstanding at December 31, 2023	71,286	863	72,149	0.0001	2.16	6,950
Exercisable as of December 31, 2023	36,811	863	37,674	0.0001	—	3,629

The granted options awards will be vested over a period from nil to four years. The weighted average grant date fair value of options granted for the years ended December 31, 2021, 2022 and 2023 were RMB1.44,RMB0.28 and RMB0.19 (US$0.03) per option, respectively.

14.Share-based Compensation (Continued)

(c)

Restricted shares activities

The following table sets forth the summary of restricted shares activities:


		Weighted-Average
	Number of Restricted Shares	Grant Date
	Granted	Fair Value
	(in thousands)	US$

January 1, 2021	9,857	0.23
Awarded	—	—
Forfeited	—	—
Vested	(6,232)	0.24
Outstanding at December 31, 2021	3,625	0.21

January 1, 2022	3,625	0.21
Awarded	—	—
Forfeited	—	—
Vested	(3,625)	0.21
Outstanding at December 31, 2022	—	—

January 1, 2023	—	—
Awarded	—	—
Forfeited	—	—
Vested	—	—
Outstanding at December 31, 2023	—	—

There are no remaining restricted shares outstanding as of December 31, 2022 and 2023.

14.Share-based Compensation (Continued)

(d)

Restricted share units activities

(i)Pursuant to the Second Amended and Restated 2019 Share Incentive Plan, 13,080,200, 2,192,900 and 6,687,500 restricted share units were granted to certain employees in 2021, 2022 and 2023, respectively. These restricted share unit awards will be vested over a period of four years, with a summary of activities as follows:


	Number of Restricted Share	Weighted-Average
	Units Granted	Grant Date Fair Value
	(in thousands)	US$

January 1, 2021	4,510	0.20
Awarded	13,080	0.30
Forfeited	(2,308)	0.20
Vested	(3,018)	0.19
Outstanding at December 31, 2021	12,264	0.31

January 1, 2022	12,264	0.31
Awarded	2,193	0.07
Forfeited	(2,612)	0.33
Vested	(3,649)	0.29
Outstanding at December 31, 2022	8,196	0.29

January 1, 2023	8,196	0.29
Awarded	6,688	0.03
Forfeited	(5,558)	0.24
Vested	(9,148)	0.10
Outstanding at December 31, 2023	178	0.16

(ii) Pursuant to the Second Amended and Restated 2019 Share Incentive Plan, the Company granted restricted share units with fixed monetary amount to certain employees from 2020 to 2023 with vesting period from one to four years. These share-settled obligations require that the variable number of shares to be issued based on an average market price for the shares over the last 30 days before each vesting day. As the monetary value of such obligation is predominantly based on a fixed monetary amount known at inception, the obligation is classified as a liability under generally accepted accounting principles in the U.S. Upon issuance of the shares to settle the obligation, equity is increased by the amount of the liability with no gain or loss recognized. For the years ended December 31, 2021, 2022 and 2023, 1,812,960, 5,637,860 and 7,989,200 restricted share units have been vested, respectively.

Cost of Revenues - Summary of Cost of Revenues (Details) ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)
Cost Of Revenues
Revenue sharing fees	¥ 1,368,498		¥ 1,351,096	¥ 1,357,270
Salary and welfare benefits	45,273		40,653	52,268
Payment handling costs	21,076		22,899	32,506
Bandwidth costs	39,424		32,795	30,889
Share-based compensation expense	26,755	$ 3,768	29,233	37,359
Others	8,281		14,426	18,088
Total	1,486,397	209,355	1,468,921	1,502,505
Cost of revenues
Cost Of Revenues
Share-based compensation expense	¥ 3,845	$ 542	¥ 7,052	¥ 11,484

- Definition

The aggregate cost of goods produced and sold and services rendered during the reporting period.

+ References

+ Details

Short-term Loans

12 Months Ended

Dec. 31, 2023

Short-term Loans

Short-term Loans

10.Short-term Loans

The Group obtained bank credit facilities totaling RMB102.6 million and unused credit line amount was RMB102.6 million as of December 31, 2023.

As of December 31, 2022 and 2023, the loans obtained by the Group under these bank facilities have maturity dates that are less than six months and the weighted average interest rate for the outstanding loans was 4.6% and nil, respectively.

As of December 31, 2022 and 2023, the balance of short-term loans was RMB73.8 million and nil, respectively.

Segment Information

12 Months Ended

Dec. 31, 2023

Segment Information

Segment Information

17.Segment Information

The Group’s chief operating decision maker (“CODM”), is concluded by the Company to be Mr. Jinnan (Marco) Lai, Chairman of the Board of Directors and CEO. The CODM reviews the consolidated results when making decisions about allocating resources and assessing performance of the Group as a whole. Information regarding the business segments provided to the Group’s CODM is at the revenue level and the Group currently does not allocate operating costs or assets to its segments, as its CODM does not use such information to allocate resources or evaluate the performance of the operating segments. As the Group’s long-lived assets are substantially located in the PRC and substantially the Group’s revenues are derived from the PRC, no geographical information is presented.

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 22
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-22

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 15
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-15

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 31
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-31

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 32
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-32

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 42
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-42

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 32
-Subparagraph (f)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-32

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 40
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-40

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//280/tableOfContent

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 26
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-26

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 34
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-34

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 41
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-41

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 21
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-21

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 21
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-21

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 32
-Subparagraph (e)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-32

+ Details

Net (Loss)/Income per Share - The computation of basic and diluted net loss per share (Details) ¥ / shares in Units, $ / shares in Units, ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥) ¥ / shares shares	Dec. 31, 2023 USD ($) $ / shares shares	Dec. 31, 2022 CNY (¥) ¥ / shares shares	Dec. 31, 2021 CNY (¥) ¥ / shares shares
Numerator:
Net (loss)/income	¥ (134,515)	$ (18,947)	¥ 86,504	¥ (127,250)
Less: net loss attributable to the non-controlling interest shareholders	(7,864)	(1,108)	(13)
Net (loss)/income attributable to the Sound Group Inc.'s ordinary shareholders	¥ (126,651)	$ (17,839)	¥ 86,517	¥ (127,250)
Denominator:
Weighted average number of ordinary shares outstanding, basic	1,078,969,851	1,078,969,851	1,036,485,949	991,715,849
Share options			852,691
Restricted shares			1,279,270
Weighted average number of ordinary shares outstanding, diluted	1,078,969,851	1,078,969,851	1,038,617,910	991,715,849
Basic net (loss)/income per share attributable to Sound Group Inc.'s ordinary shareholders \| (per share)	¥ (0.12)	$ (0.02)	¥ 0.08	¥ (0.13)
Diluted net (loss)/income per share attributable to Sound Group Inc.'s ordinary shareholders \| (per share)	¥ (0.12)	$ (0.02)	¥ 0.08	¥ (0.13)

Prepayments and Other Current Assets - Summary of Prepayments and Other Assets (Details) ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)
Prepayments and Other Current Assets
Receivables from a third-party financial institution	¥ 90,659
Prepayments to vendors	11,815			¥ 16,110
Deposits	5,624			5,286
Receivables from third-party online payment platform	1,884			2,612
Deductible VAT	4,922			2,399
Receivables from bank funds in transit	4,604
Staff advances	325			393
Others	4,831			3,591
Sub-total	124,664			30,391
Less: allowance for expected credit loss of receivables	(90,750)
Total	33,914		$ 4,777	¥ 30,391
Receivables from a third-party financial institution subject to a risk of default	¥ 90,700	$ 12,800

Taxation - Summary of Movement of Valuation Allowance (Details) - CNY (¥) ¥ in Thousands	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Taxation
Beginning Balance	¥ (108,601)	¥ (112,838)	¥ (74,607)
Movement	(8,262)	4,237	(38,231)
Ending Balance	¥ (116,863)	¥ (108,601)	¥ (112,838)

Organization and Principal Activities

12 Months Ended

Dec. 31, 2023

Organization and Principal Activities

Organization and Principal Activities

1.Organization and Principal Activities

Sound Group Inc. (the “Company”, formerly known as Lizhi Inc.) was incorporated in the Cayman Islands in January 2019. The Company is a holding company and conducts its business mainly through its subsidiaries, and through variable interest entities (“VIEs”) and subsidiaries of the VIEs (collectively referred to as the “Group”). The Group is primarily engaged in the operation of providing audio entertainment, and podcast, advertising and others in the People’s Republic of China (the “PRC” or “China”). The Group commenced its audio entertainment business from the fourth quarter of 2016.

As of December 31, 2023, the Company’s consolidated subsidiaries, the VIEs and subsidiaries of the VIEs are as follows:


		Percentage of
	Place and	direct or indirect
	year of	economic ownership
Major Subsidiaries	incorporation	%	Principal activities
Lizhi Inc. (“Lizhi BVI”)	British Virgin Islands, Y2010	100	Investment holding
Lizhi Holding Limited (“Lizhi HK”)	Hong Kong, China Y2010	100	Investment holding
Beijing Hongyiyichuang Information Technology Co., Ltd. (“Hongyi Technology”)	Beijing, China Y2011	100	Technical support and consulting services, advertising service
Tiya Inc. (“Tiya Cayman”)	Cayman Islands, Y2019	100	Investment holding
VOCAL BEATS Inc. (“Vocal Beats”)	British Virgin Islands, Y2019	68.5	Investment holding
TIYA INC. (“Tiya BVI”)	British Virgin Islands, Y2019	100	Investment holding
Tiya Holding Limited (“Tiya HK”)	Hong Kong, China Y2019	100	Investment holding
TIYA PTE. LTD.	Singapore Y2019	100	Social Networking and others
NASHOR PTE. LTD.	Singapore Y2019	68.5	Social Networking and others
Vocalbeats CO., LTD. (Formerly known as TIYA CO., LTD.)	Japan Y2022	68.5	Social Networking and others
FUNAGE FZ-LLC	UAE Y2022	68.5	Social Networking and others
SONICO SDN. BHD.	Malaysia Y2022	68.5	Technical support and consulting services
Guangzhou Tiya Information Technology Co., Ltd. (“Guangzhou Tiya”)	Guangzhou, China Y2019	100	Technical support and consulting services
Tiya Inc. (“Tiya USA”)	USA Y2020	100	Social Networking and others
Guangzhou QingYin Information Technology Co., Ltd. (“Guangzhou QingYin”)	Guangzhou, China Y2022	100	Technical support and consulting services
Guangzhou Yuyin Information Technology Co., Ltd.	Guangzhou, China Y2022	68.5	Technical support and consulting services
Guangzhou Yuechuang Information Technology Co., Ltd.	Guangzhou, China Y2022	100	Technical support and consulting services

1.Organization and Principal Activities (Continued)



	Place and	Percentage of
	year of	direct or indirect
	incorporation/	economic ownership
Major VIEs	acquisition	%	Principal activities
Guangzhou Lizhi Network Technology Co., Ltd. (“Guangzhou Lizhi”)	Guangzhou, China Y2007	100	Audio entertainment and podcast business
Guangzhou Huanliao Network Technology Co., Ltd. (“Guangzhou Huanliao”)	Guangzhou, China Y2016	100	Audio entertainment business and others


		Percentage of
	Place and	direct or indirect
	year of	economic ownership
Major subsidiaries of VIEs	incorporation	%	Principal activities
Wuhan Lizhi Network Technology Co., Ltd.	Wuhan, China Y2017	100	Audio entertainment business and others
Wuhan Yuyinliaorao Network Technology Co., Ltd.	Wuhan, China Y2019	100	Audio entertainment business and others
Beijing Guoyin Network Technology Co., Ltd.	Beijing, China Y2020	100	Technical support and consulting services
Hainan Kuangyin Network Technology Co., Ltd.	Hainan, China Y2021	100	Technical support and consulting services

1.Organization and Principal Activities (Continued)

History of the Group

Initial Public Offering

In January 2020, the Company completed an IPO in which an aggregate of 82,000,000 Class A ordinary shares was offered and sold in the form of ADSs. On January 17, 2020, the ADSs have been listed on the Nasdaq Global Market under the symbol “LIZI”. In January 2024, the Company changed the ticker symbol from “LIZI” to “SOGP” and changed corporate name from “LIZHI INC.” to “Sound Group Inc”.

Follow-on Public Offering

In April 2021, the Company completed a registered direct offering of 3,685,504 ADSs and warrants to purchase up to 2,764,128 ADSs, at an offering price of US$8.14 per ADS and the corresponding warrant. The gross proceeds of this registered direct offering were US$30.0 million before deducting placement agent fees and other offering expenses.

Contractual arrangements with VIEs

PRC laws and regulations place certain restrictions on foreign investment in value-added telecommunication service businesses. The Company conducts a significant portion of its operations in the PRC through Guangzhou Lizhi, Guangzhou Huanliao, and their subsidiaries. The Company relies on a series of contractual arrangements among its wholly-owned PRC subsidiaries, VIEs and their shareholders to conduct the business operations of the VIEs and the VIEs’ subsidiaries.

As a result of these contractual arrangements, the Company’s wholly-owned subsidiaries are entitled to substantially all of the economic benefits from the VIEs and the VIEs’ subsidiaries and are obligated to absorb all of the VIEs and the VIEs’ subsidiaries expected losses and therefore the Company has determined that it is the ultimate primary beneficiary of the VIEs and subsidiaries of the VIEs, and has consolidated the financial results of VIEs and subsidiaries of the VIEs in its consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for accounting purposes.

Below is a summary of the currently effective contractual arrangements by and among the Company’s wholly-owned subsidiaries Hongyi Technology, Guangzhou QingYin, the Company’s VIEs Guangzhou Lizhi, Guangzhou Huanliao and their shareholders (also nominee shareholders).

1.Organization and Principal Activities (Continued)

Contractual arrangements with VIEs (Continued)

Guangzhou Lizhi

Equity Pledge Agreement

Pursuant to an equity pledge agreement entered into on January 17, 2023 by and between Hongyi Technology and then shareholders of Guangzhou Lizhi, such shareholders of Guangzhou Lizhi pledged all of their equity interests in Guangzhou Lizhi to Hongyi Technology, to guarantee the performance of Guangzhou Lizhi and, to the extent applicable, such shareholders of Guangzhou Lizhi, of their obligations under the contractual arrangements of the VIE. If Guangzhou Lizhi or such shareholders of Guangzhou Lizhi fail to perform their obligations under the contractual arrangement of the VIE, Hongyi Technology will be entitled to, among other things, right to sell the pledged shares of Guangzhou Lizhi via an auction. This equity pledge agreement will remain in effect so long as any of the exclusive technical consulting and management service agreement, the operation agreement or the exclusive equity transfer option agreement, as mentioned below, remains in effect or any guaranteed obligation of Guangzhou Lizhi, or, to the extent applicable, its shareholders, remains outstanding under the VIE contractual arrangements. The existing equity pledge agreement was initially entered into in March 2011 and was subsequently amended and restated on substantially similar terms in December 2014, June 2017, August 2017, June 2019, January 2023 and May 2023, respectively.

Exclusive Equity Transfer Option Agreement

Pursuant to an exclusive equity transfer option agreement entered into on January 17, 2023 by and between Hongyi Technology and then shareholders of Guangzhou Lizhi, such shareholders of Guangzhou Lizhi exclusively granted Hongyi Technology or any party appointed by Hongyi Technology an irrevocable option to purchase all or part of the shares in Guangzhou Lizhi held by then shareholders of Guangzhou Lizhi at a price no lower than the lowest price permitted by PRC law. Whether to exercise this option and the timing, methods and frequency of exercising such option are at the full discretion of Hongyi Technology. The exclusive equity transfer option agreement shall remain valid until all shares in Guangzhou Lizhi held by the shareholders of Guangzhou Lizhi, or all irrevocable options to purchase such shares, have been transferred to Hongyi Technology or its designated person. Hongyi Technology is entitled to terminate this exclusive equity transfer option agreement if a default occurs due to reasons not related to Hongyi Technology under this agreement. The existing exclusive equity transfer option agreement was initially entered into in March 2011 and was subsequently amended and restated on substantially similar terms in December 2014, June 2017, August 2017, June 2019 and January 2023, respectively.

Exclusive Technical Consulting and Service Agreement

Pursuant to an exclusive technical consulting and service agreement entered into on June 9, 2017 by and between Hongyi Technology and Guangzhou Lizhi, Guangzhou Lizhi agreed to appoint Hongyi Technology as its exclusive provider of technology services, including software development, internet maintenance, network security and other services in exchange for a service fee which are subject to the adjustment by the Company’s relevant subsidiaries at its sole discretion, for a term of ten years starting from the date thereof. Hongyi Technology is entitled to terminate or extend the exclusive technical consulting and service agreement at its discretion. The existing exclusive technical consulting and service agreement was initially entered into in March 2011 and was subsequently superseded by an amended and restated exclusive technical consulting and service agreement on substantially similar terms in June 2017 and May 2023, respectively.

1.	Organization and Principal Activities (Continued)

Contractual arrangements with VIEs (Continued)

Guangzhou Lizhi (Continued)

Operation Agreement

Pursuant to an operation agreement entered into on January 17, 2023 by and among Hongyi Technology, Guangzhou Lizhi and then shareholders of Guangzhou Lizhi, such shareholders of Guangzhou Lizhi agreed that, without written consent of Hongyi Technology or a party designated by it, Guangzhou Lizhi shall refrain from conducting any action that may materially or adversely affect its assets, business, personnel, obligations, rights or operation, for a term of ten years starting from the date thereof. Such actions include, among other things, incurrence of debt to a third party, change of directors or senior management, acquisition or disposal of assets or shares, amendment to its articles of association or business scope and other matters. Hongyi Technology is also entitled to appoint directors and senior management of Guangzhou Lizhi and instruct Guangzhou Lizhi on matters pertinent to its daily operation, financial management. Guangzhou Lizhi is obligated to fully effectuate the appointment or instructions made by Hongyi Technology in methods consistent with applicable laws and articles of Guangzhou Lizhi. Hongyi Technology is entitled to terminate or extend the operation agreement at its discretion. The existing operation agreement was initially entered into in March 2011 and was subsequently superseded by an amended and restated operation agreement on substantially similar terms in June 2017, June 2019 and January 2023, respectively.

Power of Attorney

Pursuant to a series of power of attorney issued by shareholders of Guangzhou Lizhi on January 17, 2023, such shareholders of Guangzhou Lizhi irrevocably appointed Hongyi Technology as their attorney-in-fact to act on their behalf on all shareholder matters of Guangzhou Lizhi and exercise all rights as shareholders of Guangzhou Lizhi. This power of attorney shall remain valid until the abovementioned operation agreement is terminated or Guangzhou Lizhi is dissolved, whichever is earlier. The existing series of power of attorney was initially entered into in March 2011 and was subsequently superseded by a new series of powers of attorney on substantially similar terms in June 2017, June 2019 and January 2023, respectively.

The Equity Pledge Agreement, Exclusive Equity Transfer Option Agreement, Exclusive Technical Consulting and Service Agreement, Operation Agreement and Power of Attorney were amended to reflect the changes of shareholders’ holding in the VIE at their respective dates. No other material terms or conditions of these agreements were changed or altered. The Company is still the ultimate primary beneficiary of Guangzhou Lizhi for accounting purpose, and the Group continues to consolidate Guangzhou Lizhi.

1.	Organization and Principal Activities (Continued)

Contractual arrangements with VIEs (Continued)

Guangzhou Huanliao

To streamline operations in China, the Company terminated the entire series of VIE contractual arrangements between and among Guangzhou Tiya, Guangzhou Huanliao and Mr. Ning Ding, the sole shareholder of Guangzhou Huanliao in July 2022. Concurrently with such termination, Guangzhou QingYin entered into a new series of contractual arrangements by and among Guangzhou QingYin, Guangzhou Huanliao and then shareholder of Guangzhou Huanliao in July 2022, which were amended and restated in May 2023.

Equity Pledge Agreement

Pursuant to an equity pledge agreement entered into on January 6, 2023 by and between Guangzhou QingYin and then shareholders of Guangzhou Huanliao, such shareholders of Guangzhou Huanliao pledged all of their equity interests in Guangzhou Huanliao to Guangzhou QingYin to guarantee the performance of Guangzhou Huanliao and, to the extent applicable, such shareholders of Guangzhou Huanliao, of their obligations under the contractual arrangement of the VIE. If Guangzhou Huanliao or such shareholders of Guangzhou Huanliao fail to perform their obligations under the contractual arrangement of the VIE, Guangzhou QingYin will be entitled to, among other things, a right to sell the pledged shares of Guangzhou Huanliao via an auction. This equity pledge agreement will remain in effect so long as any of the exclusive technical consulting and management service agreement, the operation agreement and the exclusive equity transfer option agreement, as mentioned below, remains in effect and any guaranteed obligation of Guangzhou Huanliao, or, to the extent applicable, its shareholders, remains outstanding under the VIE contractual arrangements. The existing equity pledge agreement was initially entered into in July 2022 and was subsequently amended and restated on substantially similar terms in January 2023 and May 2023, respectively.

Exclusive Equity Transfer Option Agreement

Pursuant to an exclusive equity transfer option agreement entered into on January 6, 2023 by and between Guangzhou Huanliao, Guangzhou QingYin and then shareholders of Guangzhou Huanliao, such shareholders of Guangzhou Huanliao exclusively granted Guangzhou QingYin or any party appointed by Guangzhou QingYin an irrevocable option to purchase all or part of the shares in Guangzhou Huanliao held by then shareholders of Guangzhou Huanliao at a price no lower than the lowest price permitted by PRC law. Whether to exercise this option and the timing, methods and frequency of exercising such option are at the full discretion of Guangzhou QingYin. The exclusive equity transfer option agreement shall remain valid until all shares in Guangzhou Huanliao held by then shareholders of Guangzhou Huanliao, or all irrevocable options to purchase such shares, have been transferred to Guangzhou QingYin or its designated person. Guangzhou QingYin is entitled to terminate this exclusive equity transfer option agreement if a default occurs due to reasons not related to Guangzhou QingYin under this agreement. The existing exclusive equity transfer option agreement was initially entered into in July 2022 and was subsequently amended and restated on substantially similar terms in January 2023.

Exclusive Technical Consulting and Service Agreement

Pursuant to an exclusive technical consulting and service agreement entered into on July 19, 2022 by and between Guangzhou QingYin and Guangzhou Huanliao, Guangzhou Huanliao agreed to appoint Guangzhou QingYin as its exclusive provider of technology services, including software development, internet maintenance, network security and other services in exchange for a service fee which are subject to the adjustment by the Company’s relevant subsidiaries at its sole discretion, for a term of ten years starting from the date thereof. Guangzhou QingYin is entitled to terminate or extend the exclusive technical consulting and service agreement at its discretion. The existing exclusive technical consulting and service agreement was initially entered into in July 2022 and was subsequently superseded by an amended and restated exclusive technical consulting and service agreement on substantially similar terms in May 2023.

1.	Organization and Principal Activities (Continued)

Contractual arrangements with VIEs (Continued)

Guangzhou Huanliao (Continued)

Operation Agreement

Pursuant to an operation agreement entered into on January 6, 2023 by and among Guangzhou QingYin, Guangzhou Huanliao and then shareholders of Guangzhou Huanliao, such shareholders of Guangzhou Huanliao agreed that, without written consent of Guangzhou QingYin or a party designated by it, Guangzhou Huanliao shall refrain from conducting any action that may materially or adversely affect its assets, business, personnel, obligations, rights or operation, for a term of ten years starting from the date thereof. Such actions include, among other things, incurrence of debt to a third party, change of directors or senior management, acquisition or disposal of assets or shares, amendment to its articles of association or business scope and other matters. Guangzhou QingYin is also entitled to appoint directors and senior management of Guangzhou Huanliao and instruct Guangzhou Huanliao on matters relating to its daily operation, financial management. Guangzhou Huanliao is obligated to fully effectuate the appointment or instructions made by Guangzhou QingYin in methods consistent with applicable laws and articles of Guangzhou Huanliao. Guangzhou QingYin is entitled to terminate or extend the operation agreement at its discretion. The existing operation agreement was initially entered into in July 2022 and was subsequently amended and restated on substantially similar terms in January 2023.

Power of Attorney

Pursuant to a series of power of attorney issued by shareholders of Guangzhou Huanliao on January 6, 2023, such shareholders of Guangzhou Huanliao irrevocably appointed Guangzhou QingYin as their attorney-in-fact to act on their behalf on all shareholder matters of Guangzhou Huanliao and exercise all rights as shareholders of Guangzhou Huanliao. This power of attorney shall remain valid until the abovementioned operation agreement is terminated or Guangzhou QingYin is dissolved. The existing series of power of attorney was initially entered into in July 2022 and was subsequently superseded by a new series of powers of attorney on substantially similar terms in January 2023.

The Equity Pledge Agreement, Exclusive Equity Transfer Option Agreement, Exclusive Technical Consulting and Service Agreement, Operation Agreement and Power of Attorney were amended to reflect the changes of shareholders’ holding in the VIE at their respective dates. No other material terms or conditions of these agreements were changed or altered. The Company is still the ultimate primary beneficiary of Guangzhou Huanliao for accounting purpose and the Group continues to consolidate Guangzhou Huanliao.

Risks in relation to the VIE structure

A significant part of the Company’s business is conducted through the VIEs, of which the Company is the ultimate primary beneficiary. The Company has been advised by its PRC legal counsel, that its contractual arrangements with its consolidated VIEs as described in the Company’s annual report are valid, binding and enforceable under the current laws and regulations of China. However, there are substantial uncertainties regarding the interpretation and application of PRC laws and regulations including those that govern the contractual arrangements, which could limit the Group’s ability to enforce these contractual arrangements and if the nominee shareholders of the VIEs were to reduce their interests in the Group, their interest may diverge from that of the Group and that may potentially increase the risk that they would seek to act contrary to the contractual arrangements.

1.Organization and Principal Activities (Continued)

Risks in relation to the VIE structure (Continued)

The enforceability, and therefore the benefits, of the contractual agreements between the Company and the VIEs depend on these individuals enforcing the contracts. There is a risk that the benefits of ownership between the Company and the VIEs may not be aligned in the future. Given the significance and importance of the VIEs, there would be a significant negative impact to the Company if these contracts were not enforced.

The Group’s operations depend on the VIEs to honour their contractual agreements with the Group and the enforceability, and therefore the benefits depend on the authorization by the shareholders of the VIEs to exercise voting rights on all matters requiring shareholder approval in the VIEs. The Company believes that the agreements on authorization to exercise shareholder’s voting power are legally enforceable and the possibility that it will no longer be able to be the ultimate primary beneficiary and consolidate the VIE as a result of the aforementioned risks and uncertainties is remote.

The Company’s ability to be the ultimate primary beneficiary of the VIEs also depends on the Power of Attorney the shareholders have to vote on all matters requiring shareholder approval in the VIEs. As noted above, the Company believes these Power of Attorney are legally enforceable but may not be as effective as direct equity ownership.

In addition, if the Group’s corporate structure or the contractual arrangements with the VIEs were found to be in violation of any existing or future PRC laws and regulations, the PRC regulatory authorities could, within their respective jurisdictions:

●

revoke the business licenses and/or operating licenses of the Group;

●

confiscate any of the Group’s income that they deem to be obtained through illegal operations;

●

discontinue or place restrictions or onerous conditions on the Group’s operations;

●

place restrictions on the Group’s right to collect revenues;

●

shut down the Group’s servers or block the Group’s apps/websites;

●

require the Group to restructure the operations in such a way as to compel the Group to establish a new enterprise, re-apply for the necessary licenses or relocate the Group’s businesses, staff and assets;

●

impose additional conditions or requirements with which the Group may not be able to comply;

●

taking other regulatory or enforcement actions against the Group that could be harmful to the Group’s business; or

●

impose fines on the Group.

1.	Organization and Principal Activities (Continued)

Risks in relation to the VIE structure (Continued)

The imposition of any of these restrictions or actions could result in a material adverse effect on the Group’s ability to conduct its business. In such case, the Group may lose the rights to direct the activities of the VIEs or the right to receive their economic benefits, which may result in deconsolidation of the VIEs in the Group’s consolidated financial statements. In the opinion of the Company’s management, the likelihood for the Group to lose such ability is remote based on current facts and circumstances. The Group believes that the contractual arrangements among each of the VIEs, their respective shareholders and relevant wholly foreign owned enterprises are in compliance with PRC law and are legally enforceable. The Group’s operations depend on the VIEs to honor their contractual arrangements with the Group. These contractual arrangements are governed by PRC law and disputes arising out of these agreements are expected to be decided by arbitration in the PRC. Management believes that each of the contractual arrangements constitutes valid and legally binding obligations of each party to such contractual arrangements under PRC laws. However, the interpretation and implementation of the laws and regulations in the PRC and their application on the legality, binding effect and enforceability of contracts are subject to the discretion of competent PRC authorities, and therefore there is no assurance that relevant PRC authorities will take the same position as the Group herein in respect of the legality, binding effect and enforceability of each of the contractual arrangements. Meanwhile, since the PRC legal system continues to evolve, the interpretations of many laws, regulations and rules are not always uniform and enforcement of these laws, regulations and rules involve uncertainties, which may limit legal protections available to the Group to enforce the contractual arrangements should the VIEs or the nominee shareholders of the VIEs fail to perform their obligations under those contractual arrangements.

1.	Organization and Principal Activities (Continued)

Risks in relation to the VIE structure (Continued)


	As of December 31,	As of December 31,
	2022	2023
	RMB	RMB
ASSETS
Current assets:
Cash and cash equivalents	302,103	168,694
Restricted cash	—	—
Accounts receivable, net	902	922
Prepayments and other current assets	21,365	19,261
Amount due from the subsidiaries of the Group	781	36,484
Total current assets	325,151	225,361
Non-current assets:
Property, equipment and leasehold improvement, net	18,390	10,726
Intangible assets, net	1,104	1,314
Right-of-use assets, net	7,087	885
Total non-current assets	26,581	12,925
TOTAL ASSETS	351,732	238,286
Current liabilities:
Accounts payable	50,735	40,066
Deferred revenue	27,718	25,389
Salary and welfare payable	120,563	113,320
Taxes payable	4,112	2,784
Short-term loans	66,800	—
Lease liabilities due within one year	7,021	632
Accrued expenses and other current liabilities	42,770	32,352
Amount due to the subsidiaries of the Group	379,306	394,482
Total current liabilities	699,025	609,025
Non-current liabilities:
Lease liabilities	160	255
Total non-current liabilities	160	255
TOTAL LIABILITIES	699,185	609,280

1.	Organization and Principal Activities (Continued)

Risks in relation to the VIE structure (Continued)

The VIEs hold assets with no carrying value in the consolidated balance sheet that are important to the Company’s ability to produce revenue (referred to as unrecognized revenue-producing assets). Unrecognized revenue-producing assets held by the VIEs mainly include the ICP License and the Internet Culture Operating License. Recognized revenue-producing assets held by the VIEs mainly include copyrights, trademarks and domain names.


	For the year ended
	December 31,	December 31,	December 31,
	2021	2022	2023
	RMB	RMB	RMB
Net revenues	1,975,758	2,155,620	2,069,491
Net (loss)/income	(81,551)	106,188	(23,554)

Included in the net (loss)/income of the VIEs are charges for technical development or technical service fees paid to other entities within the Group. The amount of such fees were RMB9.6 million, RMB82.1 million, and RMB136.7 million in 2021, 2022 and 2023, respectively.


	For the year ended
	December 31,	December 31,	December 31,
	2021	2022	2023
	RMB	RMB	RMB
Net cash (used in)/generated from operating activities	(17,723)	147,067	(25,170)
Net cash generated from/(used in) investing activities	52,323	(5,576)	(2,181)
Net cash generated from/(used in) financing activities	7,298	(33,960)	(106,058)
Net increase/(decrease) in cash, cash equivalents and restricted cash	41,898	107,531	(133,409)

For the years ended December 31, 2021, 2022 and 2023, net cash generated from financing activities in the VIEs consist of: i) net repayments to the Group companies, amounting to RMB22.2 million, RMB31.8 million and RMB39.3 million, respectively, and ii) net borrowing from/(net repayments to) bank loans of RMB29.5 million, RMB(2.2) million and RMB(66.8)million, respectively.

In accordance with various contractual agreements, the Company has the power to direct the activities of the VIEs and their subsidiaries and can have assets transferred out of the VIEs. Therefore, the Company considers that there are no assets in the respective VIEs that can be used only to settle obligations of the respective VIEs, except for the registered capital of the VIEs amounted to approximately RMB51.0 million and RMB51.0 million as of December 31, 2022 and 2023, respectively, as well as certain non-distributable statutory reserves amounting to RMB0.5 million and RMB0.6 million as of December 31, 2022 and 2023, respectively. As the respective VIEs are incorporated as limited liability companies under the PRC Company Law, creditors do not have recourse to the general credit of the Company for the liabilities of the respective VIEs. There is currently no contractual arrangement that would require the Company to provide additional financial support to the VIEs. As the Group is conducting a significant portion of businesses in the PRC through the VIEs, the Group may provide additional financial support on a discretionary basis in the future, which could expose the Group to a loss.

There is no VIEs in the Group where the Company or any subsidiary has a variable interest but is not the primary beneficiary.

1.	Organization and Principal Activities (Continued)

Liquidity

The Group incurred net (loss)/income of RMB(127.3) million, RMB86.5 million and RMB(134.5) million for the years ended December 31, 2021, 2022 and 2023, respectively. Net cash (used in)/generated from operating activities were RMB(40.4) million, RMB136.3 million and RMB(117.0) million for the years ended December 31, 2021, 2022 and 2023, respectively. Accumulated deficit was RMB2,280.5 million and RMB2,408.3 million as of December 31, 2022 and 2023, respectively. The Group assesses its liquidity by its ability to generate cash from operating activities and attract investors’ investments.

The Group’s principal sources of liquidity have been cash generated from its operations and contributions from its shareholders, as well as short term borrowings. As of December 31, 2023, it had RMB495.0 million (US$69.7 million) in cash and cash equivalents which are readily convertible to fixed amounts of cash and with original maturities from the date of purchase with terms of three months or less. The Group had a positive working capital (defined as total current assets deducted by total current liabilities) of RMB260.5 million (US$36.7 million) as of December 31, 2023. Therefore, the Group believes its current cash and cash equivalents will be sufficient to meet the cash requirements to fund planned operations and other commitments for at least the next twelve months from the date of the issuance of the consolidated financial statements. The Group’s consolidated financial statements have been prepared based on the Company continuing as a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business.

Share-based Compensation - Summary of restricted shares activities (Details) - $ / shares	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Share-based Compensation
Restricted shares, Vested	(7,989,200)	(5,637,860)	(1,812,960)
Restricted shares
Share-based Compensation
Restricted shares, Beginning balance	0	3,625,000	9,857,000
Restricted shares, Vested		(3,625,000)	(6,232,000)
Restricted shares, Ending balance	0	0	3,625,000
Restricted weighted-average grant date fair value, Beginning balance		$ 0.21	$ 0.23
Restricted weighted-average grant date fair value, Vested		$ 0.21	0.24
Restricted weighted-average grant date fair value, Ending balance			$ 0.21
Restricted share units
Share-based Compensation
Restricted shares, Beginning balance	8,196,000	12,264,000	4,510,000
Restricted shares, Awarded	6,687,500	2,192,900	13,080,200
Restricted shares, Forfeited	(5,558,000)	(2,612,000)	(2,308,000)
Restricted shares, Vested	(9,148,000)	(3,649,000)	(3,018,000)
Restricted shares, Ending balance	178,000	8,196,000	12,264,000
Restricted weighted-average grant date fair value, Beginning balance	$ 0.29	$ 0.31	$ 0.20
Restricted weighted-average grant date fair value, Awarded	0.03	0.07	0.30
Restricted weighted-average grant date fair value, Forfeited	0.24	0.33	0.20
Restricted weighted-average grant date fair value, Vested	0.10	0.29	0.19
Restricted weighted-average grant date fair value, Ending balance	$ 0.16	$ 0.29	$ 0.31

Significant Accounting Policies - Summary of revenue by type of service (Details) ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)
Segment Information
Total	¥ 2,071,772	$ 291,803	¥ 2,185,266	¥ 2,119,514
Audio entertainment
Segment Information
Total	2,063,346		2,174,314	2,101,475
Podcast, advertising and others
Segment Information
Total	¥ 8,426		¥ 10,952	¥ 18,039

- Definition

Amount of revenue recognized from goods sold, services rendered, insurance premiums, or other activities that constitute an earning process. Includes, but is not limited to, investment and interest income before deduction of interest expense when recognized as a component of revenue, and sales and trading gain (loss).

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(g)(1)(ii))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 323
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481687/323-10-50-3

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 825
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 28
-Subparagraph (f)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482907/825-10-50-28

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 220
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Subparagraph (SX 210.5-03(1))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483621/220-10-S99-2

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(i))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1A

Reference 6: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(ii))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1A

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iii)(A))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1A

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iv))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1A

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(5))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1A

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(i))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1B

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(A))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1B

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(B))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1B

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iv))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1B

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(5))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480097/470-10-S99-1B

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 30
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-30

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 42
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-42

Reference 17: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 22
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-22

Reference 18: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 32
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-32

Reference 19: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 40
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-40

Reference 20: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 22
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-22

Reference 21: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 32
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-32

Reference 22: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 41
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-41

Reference 23: http://www.xbrl.org/2003/role/disclosureRef
-Topic 942
-SubTopic 235
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.9-05(b)(2))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479557/942-235-S99-1

+ Details

Property, Equipment and Leasehold Improvement, Net - Summary of Property Plant and Equipment (Details) ¥ in Thousands, $ in Thousands	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)
Property, Equipment and Leasehold Improvement, Net
Total property, equipment and leasehold improvement	¥ 99,989		¥ 101,597
Less: accumulated depreciation	(82,701)		(75,051)
Property, equipment and leasehold improvement, net	17,288	$ 2,435	26,546
Electronic equipment
Property, Equipment and Leasehold Improvement, Net
Total property, equipment and leasehold improvement	79,432		80,099
Furniture and office equipment
Property, Equipment and Leasehold Improvement, Net
Total property, equipment and leasehold improvement	2,890		3,273
Vehicles
Property, Equipment and Leasehold Improvement, Net
Total property, equipment and leasehold improvement	294		2,818
Leasehold improvement
Property, Equipment and Leasehold Improvement, Net
Total property, equipment and leasehold improvement	¥ 17,373		¥ 15,407

Organization and Principal Activities - Summary of Variable Interest Entities (Details) ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2020 CNY (¥)
Current assets:
Cash and cash equivalents	¥ 494,965		¥ 568,192	¥ 533,293	$ 69,700
Restricted cash	2,652		10,323	4,155	374
Accounts receivable, net	1,557		3,233		219
Prepayments and other current assets	33,914		30,391		4,777
Total current assets	533,088		723,492		75,084
Short-term investments			111,353
Non-current assets:
Property, equipment and leasehold improvement, net	17,288		26,546		2,435
Intangible assets, net	1,390		1,183		196
Total non-current assets	33,486		52,845		4,716
TOTAL ASSETS	566,574		776,337		79,800
Current liabilities:
Accounts payable	43,184		53,832		6,082
Salary and welfare payable	136,869		136,837		19,277
Short-term loans			73,765
Lease liabilities due within one year	10,351		18,372		1,458
Accrued expenses and other current liabilities	48,510		47,622		6,835
Total current liabilities	272,625		371,526		38,400
Non-current liabilities:
Lease liabilities	3,936		8,195		554
Total non-current liabilities	3,936		12,147		554
TOTAL LIABILITIES	276,561		383,673		38,954
TOTAL Sound Group Inc.'s SHAREHOLDERS' EQUITY	299,475		392,677		42,179
Non-controlling interests	(9,462)		(13)		(1,333)
TOTAL SHAREHOLDERS' EQUITY	290,013		392,664	254,855	40,846	¥ 169,191
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	566,574		776,337		$ 79,800
Net revenues	2,071,772	$ 291,803	2,185,266	2,119,514
Net (loss)/income	(134,515)		86,504	(127,250)
Net cash (used in)/generated from operating activities	(117,000)	(16,487)	136,267	(40,426)
Net cash generated from/(used in) investing activities	105,653	14,880	(122,783)	52,101
Net cash generated from/(used in) financing activities	(71,674)	$ (10,094)	4,771	212,682
Variable Interest Entity Primary Beneficiary
Current assets:
Cash and cash equivalents	168,694		302,103
Accounts receivable, net	922		902
Prepayments and other current assets	19,261		21,365
Amounts due from Sound Group Companies	¥ 36,484		¥ 781
Other Receivable, after Allowance for Credit Loss, Current, Related Party, Type [Extensible Enumeration]	srt:AffiliatedEntityMember		srt:AffiliatedEntityMember		srt:AffiliatedEntityMember
Total current assets	¥ 225,361		¥ 325,151
Non-current assets:
Property, equipment and leasehold improvement, net	10,726		18,390
Intangible assets, net	1,314		1,104
Right-of-use assets, net	885		7,087
Total non-current assets	12,925		26,581
TOTAL ASSETS	238,286		351,732
Current liabilities:
Accounts payable	40,066		50,735
Deferred revenue	25,389		27,718
Salary and welfare payable	113,320		120,563
Taxes payable	2,784		4,112
Short-term loans			66,800
Lease liabilities due within one year	632		7,021
Accrued expenses and other current liabilities	32,352		42,770
Amount due to the subsidiaries of the Group	¥ 394,482		¥ 379,306
Other Liability, Current, Related Party, Type [Extensible Enumeration]	srt:AffiliatedEntityMember		srt:AffiliatedEntityMember		srt:AffiliatedEntityMember
Total current liabilities	¥ 609,025		¥ 699,025
Non-current liabilities:
Lease liabilities	255		160
Total non-current liabilities	255		160
TOTAL LIABILITIES	609,280		699,185
Net revenues	2,069,491		2,155,620	1,975,758
Net (loss)/income	(23,554)		106,188	(81,551)
Net cash (used in)/generated from operating activities	(25,170)		147,067	(17,723)
Net cash generated from/(used in) investing activities	(2,181)		(5,576)	52,323
Net cash generated from/(used in) financing activities	(106,058)		(33,960)	7,298
Net increase/(decrease) in cash, cash equivalents and restricted cash	¥ (133,409)		¥ 107,531	¥ 41,898

Leases (Tables)

12 Months Ended

Dec. 31, 2023

Leases

Summary of Group's operating leases mainly related to offices facilities


	December 31, 2022		December 31, 2023
	RMB		RMB
Operating lease ROU assets	25,116		13,990
Operating lease liabilities, non-current	(8,195)		(3,936)
Operating lease liabilities, current	(18,372)		(10,351)
Total operating lease liabilities	(26,567)		(14,287)
Weighted average remaining lease term	1.7 years		1.5 years
Weighted average discount rate	6.3	%	5.7	%

Summary of components of lease cost and supplemental cash flow information


	For the year ended December 31,
	2021	2022	2023
	RMB	RMB	RMB
Operating lease cost	10,329	17,284	16,903
Short-term lease cost	9,353	10,974	12,895
Total lease cost	19,682	28,258	29,798


	For the year ended December 31,
	2021	2022	2023
	RMB	RMB	RMB
Cash payments for operating leases	9,786	17,910	18,257
Right-of-use assets obtained in exchange for operating lease liabilities	34,988	13,505	6,127

Summary of maturity of operating lease liabilities


		RMB
2024		10,838
2025		3,150
2026		898
Total future lease payments		14,886
Impact of discounting remaining lease payments		(599)
Total lease liabilities		14,287

Accounts Receivable, Net (Tables)

12 Months Ended

Dec. 31, 2023

Accounts Receivable, Net

Schedule of accounts receivable, net


	December 31, 2022	December 31, 2023
	RMB	RMB
Accounts receivable, gross:	3,233	1,596
Less: allowance for expected credit loss of receivables	—	(39)
Accounts receivable, net	3,233	1,557

Schedule of movements of the credit loss provision


	For the years ended December 31,
	2021	2022	2023
	RMB	RMB	RMB
Balance at beginning of the year	—	—	—
Current year provision	—	—	(39)
Balance at end of the year	—	—	(39)

CONSOLIDATED BALANCE SHEETS ¥ in Thousands, $ in Thousands	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)
Current assets:
Cash and cash equivalents	¥ 494,965	$ 69,700	¥ 568,192
Short-term investments			111,353
Restricted cash	2,652	374	10,323
Accounts receivable, net	1,557	219	3,233
Prepayments and other current assets	33,914	4,777	30,391
Total current assets	533,088	75,084	723,492
Non-current assets:
Property, equipment and leasehold improvement, net	17,288	2,435	26,546
Intangible assets, net	1,390	196	1,183
Right-of-use assets, net	13,990	1,970	25,116
Other non-current assets	818	115
Total non-current assets	33,486	4,716	52,845
TOTAL ASSETS	566,574	79,800	776,337
Current liabilities:
Accounts payable	43,184	6,082	53,832
Deferred revenue	29,248	4,119	35,677
Salary and welfare payable	136,869	19,277	136,837
Taxes payable	4,463	629	5,421
Short-term loans			73,765
Lease liabilities due within one year	10,351	1,458	18,372
Accrued expenses and other current liabilities	48,510	6,835	47,622
Total current liabilities	272,625	38,400	371,526
Non-current liabilities:
Lease liabilities	3,936	554	8,195
Other non-current liabilities			3,952
Total non-current liabilities	3,936	554	12,147
TOTAL LIABILITIES	276,561	38,954	383,673
COMMITMENTS AND CONTINGENCIES (NOTE 16)
SHAREHOLDERS' EQUITY
Treasury stock	(958)	(135)	(10)
Additional paid in capital	2,688,450	378,660	2,657,433
Statutory reserves	1,642	231	529
Accumulated deficit	(2,408,300)	(339,203)	(2,280,543)
Accumulated other comprehensive income	17,923	2,524	14,557
TOTAL Sound Group Inc.'s SHAREHOLDERS' EQUITY	299,475	42,179	392,677
Non-controlling interests	(9,462)	(1,333)	(13)
TOTAL SHAREHOLDERS' EQUITY	290,013	40,846	392,664
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	566,574	79,800	776,337
Class A ordinary shares
SHAREHOLDERS' EQUITY
Ordinary shares	557	78	543
Class B ordinary shares
SHAREHOLDERS' EQUITY
Ordinary shares	¥ 168	$ 24	¥ 168

Fair Value Measurement (Tables)

12 Months Ended

Dec. 31, 2023

Fair Value Measurement

Summary of financial instruments measured or disclosed at fair value on a recurring basis


	Fair Value Measurement at
	December 31, 2022 Using
	Quoted Prices	Significant
	in Active Market	Other	Unobservable	Fair Value at
	for Identical	Observable	inputs	December 31,
	Assets (Level 1)	Inputs (Level 2)	(Level 3)	2022
	RMB	RMB	RMB	RMB	US$
Short-term investments	—	111,353	—	111,353	16,145
Total	—	111,353	—	111,353	16,145

Taxes Payable (Tables)

12 Months Ended

Dec. 31, 2023

Taxes Payable

Summary of taxes payable


	December 31, 2022	December 31, 2023
	RMB	RMB
VAT payables	1,846	1,441
Withholding individual income taxes for employees	2,533	2,168
Income tax payable	557	496
Others	485	358
Total	5,421	4,463

Related party transactions (Details) $ / shares in Units, ¥ in Thousands, $ in Millions	1 Months Ended		12 Months Ended
	Jan. 31, 2023 USD ($) $ / shares shares	Apr. 30, 2021 shares	Dec. 31, 2021 CNY (¥)
Related party transactions
Stock issued, during the period		3,685,504
Aggregate subscription price \| ¥			¥ 183,188
Vocal Beats Inc
Related party transactions
Ownership percentage	68.52%
Vocal Beats Inc
Related party transactions
Ordinary shares, shares issued	100,000,000
Ordinary shares, par value \| $ / shares	$ 0.0001
Vocal Beats Inc \| Sky Voice Limited
Related party transactions
Stock issued, during the period	31,481,481
Aggregate subscription price \| $	$ 0.3
Sky Voice Limited \| Vocal Beats Inc
Related party transactions
Ownership percentage	31.48%

Taxes Payable - Summary of Taxes Payable (Details) - CNY (¥) ¥ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Taxes Payable
VAT payables	¥ 1,441	¥ 1,846
Withholding individual income taxes for employees	2,168	2,533
Income tax payable	496	557
Others	358	485
Total	¥ 4,463	¥ 5,421

ADDITIONAL INFORMATION: CONDENSED FINANCIAL STATEMENTS OF PARENT COMPANY - CONDENSED STATEMENTS OF CASH FLOWS (Details) ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)
CONDENSED STATEMENTS OF CASH FLOWS
Net cash used in operating activities	¥ (117,000)	$ (16,487)	¥ 136,267	¥ (40,426)
Net cash used in investing activities
Net cash generated from/(used in) investing activities	105,653	14,880	(122,783)	52,101
Net cash generated from financing activities
Proceeds from issuance of ordinary shares				183,188
Proceeds from exercise of vested share options	5	1	5	3
Net cash generated from/(used in) financing activities	(71,674)	(10,094)	4,771	212,682
Effect of exchange rate changes on cash and cash equivalents	2,168	307	22,812	(6,063)
Net increase/(decrease) in cash, cash equivalents and restricted cash	(80,898)	(11,394)	41,067	218,294
Cash, cash equivalents and restricted cash at beginning of the year	578,515	81,482	537,448	319,154
Cash, cash equivalents and restricted cash at end of the year	497,617	$ 70,088	578,515	537,448
Parent company \| Reportable legal entity
CONDENSED STATEMENTS OF CASH FLOWS
Net cash used in operating activities	(103,250)		(11,752)	(15,728)
Net cash used in investing activities
Cash paid for investments in subsidiaries	(114,911)		(50,204)	(83,661)
Other investing activities	91,022		(91,022)
Cash repayment from Group companies	21,466		3,677
Net cash generated from/(used in) investing activities	(2,423)		(137,549)	(83,661)
Net cash generated from financing activities
Capital contribution and loans received from Group companies	80,000
Proceeds from issuance of ordinary shares				183,188
Proceeds from exercise of vested share options	5		5	3
Net cash generated from/(used in) financing activities	80,005		5	183,191
Effect of exchange rate changes on cash and cash equivalents	2,539		18,190	(4,291)
Net increase/(decrease) in cash, cash equivalents and restricted cash	(23,129)		(131,106)	79,511
Cash, cash equivalents and restricted cash at beginning of the year	93,673		224,779	145,268
Cash, cash equivalents and restricted cash at end of the year	¥ 70,544		¥ 93,673	¥ 224,779

Organization and Principal Activities - Additional Information (Details) $ / shares in Units, ¥ in Thousands, $ in Thousands		1 Months Ended	12 Months Ended
	Jan. 01, 2020 shares	Apr. 30, 2021 USD ($) $ / shares shares	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)	Dec. 31, 2023 USD ($)
Organization and Reorganization
Place of incorporation			Cayman Islands	Cayman Islands
Statutory reserves			¥ 1,642		¥ 529		$ 231
Net (loss)/income			(134,515)	$ (18,947)	86,504	¥ (127,250)
Net cash (used in)/generated from operating activities			(117,000)	$ (16,487)	136,267	(40,426)
Accumulated deficit			2,408,300		2,280,543		339,203
Share Price \| $ / shares		$ 8.14
Stock issued, during the period \| shares		3,685,504
Cash and cash equivalents			494,965		568,192	533,293	69,700
Working capital			260,500				$ 36,700
Proceeds from issuance initial public offering \| $		$ 30,000
Warrant
Organization and Reorganization
Stock issued, during the period \| shares		2,764,128
IPO \| common Class A
Organization and Reorganization
Stock issued, during the period \| shares	82,000,000
Variable Interest Entity Primary Beneficiary
Organization and Reorganization
Obligations to settle of variable interest entity			51,000		51,000
Statutory reserves			600		500
Net cash (used in)/generated from operating activities			(25,170)		147,067	(17,723)
Cash and cash equivalents			168,694		302,103
Technical development fee			136,700		82,100	9,600
Net repayments to the Group companies			39,300		31,800	22,200
Net borrowing from bank loans						¥ 29,500
Net repayments to bank loans			¥ (66,800)		¥ (2,200)

Leases

12 Months Ended

Dec. 31, 2023

Leases

Leases

7.Leases

The Group’s operating leases mainly related to offices facilities and staff quarters. As of December 31, 2022 and 2023, the Group recognized the following items related to operating leases on its consolidated balance sheet:


	December 31, 2022		December 31, 2023
	RMB		RMB
Operating lease ROU assets	25,116		13,990
Operating lease liabilities, non-current	(8,195)		(3,936)
Operating lease liabilities, current	(18,372)		(10,351)
Total operating lease liabilities	(26,567)		(14,287)
Weighted average remaining lease term	1.7 years		1.5 years
Weighted average discount rate	6.3	%	5.7	%

The components of lease cost for the years ended December 31, 2021, 2022 and 2023 were as follows:


	For the year ended December 31,
	2021	2022	2023
	RMB	RMB	RMB
Operating lease cost	10,329	17,284	16,903
Short-term lease cost	9,353	10,974	12,895
Total lease cost	19,682	28,258	29,798

No lease cost was capitalized as part of the cost of another asset.

Supplemental cash flow information related to the operating leases was as follows:


	For the year ended December 31,
	2021	2022	2023
	RMB	RMB	RMB
Cash payments for operating leases	9,786	17,910	18,257
Right-of-use assets obtained in exchange for operating lease liabilities	34,988	13,505	6,127

A summary of maturity of operating lease liabilities under the Group’s non-cancellable operating leases as of December 31, 2023 is as follows:


		RMB
2024		10,838
2025		3,150
2026		898
Total future lease payments		14,886
Impact of discounting remaining lease payments		(599)
Total lease liabilities		14,287

The increase of operating lease assets obtained in exchange for operating lease liabilities in 2023 was mainly due to the renewal of lease agreements that expired, and several new lease agreements signed by the Group in 2023. As of December 31, 2022 and 2023, the Group had no operating leases that had not yet commenced.

Subsequent Events (Details) ¥ in Millions, $ in Millions	1 Months Ended	12 Months Ended
Subsequent Events (Details) ¥ in Millions, $ in Millions	Mar. 31, 2024 USD ($)	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)
Subsequent Events
Relevant deposits with financial institutions		¥ 90.7	$ 12.8
Allowance for credit loss provision		¥ 90.7	$ 12.8
Subsequent Events
Subsequent Events
Relevant deposits with financial institutions	$ 12.8

Restricted Net Assets - (Details) - CNY (¥) ¥ in Millions	12 Months Ended
Restricted Net Assets - (Details) - CNY (¥) ¥ in Millions	Dec. 31, 2023	Dec. 31, 2022
Restricted Net Assets
Annual appropriation to reserve percent	10.00%
Percentage of capital	50.00%
Restricted assets	¥ 171.2	¥ 129.7

Significant Accounting Policies - Additional information (Details) ¥ / shares in Units, ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥) segment agreement ¥ / shares $ / ¥	Dec. 31, 2023 USD ($) segment agreement	Dec. 31, 2022 CNY (¥) agreement	Dec. 31, 2021 CNY (¥) agreement	Dec. 31, 2023 USD ($) $ / ¥
Significant Accounting Policies
Cash and cash equivalents	¥ 494,965		¥ 568,192	¥ 533,293	$ 69,700
Total percentage of cash and cash equivalents	72.50%		73.20%		72.50%
Number of lien arrangements \| agreement	0	0	0	0
Restricted cash	¥ 2,652		¥ 10,323	¥ 4,155	$ 374
Impairment charges	0		0	0
Recognized revenue	14,000		12,500	11,000
Revenue remaining performance obligation	0		0	0
Advertising and promotional expenses	202,600		228,200	360,200
Lease liabilities	14,287		26,567
Lease liabilities due within one year	10,351		18,372		1,458
Lease liabilities	3,936		8,195		$ 554
Finance lease	0		0
Unrecognized uncertain tax positions	¥ 0		0	0
Exchange rate \| $ / ¥	7.0999				7.0999
Annual Appropriation To Reserve Percent	10.00%				10.00%
Threshold limit for reserve appropriation	50.00%				50.00%
Appropriations to general reserve fund and statutory surplus fund	¥ 1,600		500	0
Number of Operating Segments \| segment	1	1
Number of Reportable Segments \| segment	1	1
Exercise price of fair value grant date price \| ¥ / shares	¥ 0
Share-based compensation expense	¥ 26,755	$ 3,768	29,233	37,359
PRC Contribution Plan
Significant Accounting Policies
Employee benefit expenses	46,400		53,900	¥ 57,200
Alipay and WeChat Pay
Significant Accounting Policies
Cash and cash equivalents	12,400		8,600
Subsidiaries
Significant Accounting Policies
Cash and cash equivalents	360,500		415,600
Bank balance
Significant Accounting Policies
Restricted cash	¥ 2,700		¥ 10,300

Property, Equipment and Leasehold Improvement, Net - Additional Information (Details) ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)
Property, Equipment and Leasehold Improvement, Net.
Depreciation expenses	¥ 13,200	$ 1,862	¥ 18,056	¥ 19,225
Impairment charges	¥ 0		¥ 0	¥ 0

Restricted Net Assets

12 Months Ended

Dec. 31, 2023

Restricted Net Assets

Restricted Net Assets

20.Restricted Net Assets

Relevant PRC laws and regulations permit PRC companies to pay dividends only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. Additionally, the Company’s PRC subsidiaries, VIEs and subsidiaries of the VIEs can only distribute dividends upon approval of the shareholders after they have met the PRC requirements for appropriation to the general reserve fund and the statutory surplus fund, respectively. The general reserve fund and the statutory surplus fund require that annual appropriations of 10% of net after-tax income should be set aside prior to payment of any dividends, until the reserve fund reached 50% of the registered capital of the respective company. As a result of these and other restrictions under PRC laws and regulations, the PRC subsidiaries, VIEs and subsidiaries of the VIEs are restricted in their ability to transfer a portion of their net assets to the Company either in the form of dividends, loans or advances, which restricted portion amounted to approximately RMB129.7 million and RMB171.2 million as of December 31, 2022 and 2023, respectively. Even though the Company currently does not require any such dividends, loans or advances from the PRC subsidiaries, VIEs and subsidiaries of the VIEs for working capital and other funding purposes, nor any remaining, undistributed earnings existed in its PRC subsidiaries as of December 31, 2023, the Company may in the future require additional cash resources from its PRC subsidiaries, VIEs and subsidiaries of the VIEs due to changes in business conditions, to fund future acquisitions and developments, or merely declare and pay dividends to or distributions to the Company’s shareholders, if any.

Accrued Expenses and Other Current Liabilities (Tables)

12 Months Ended

Dec. 31, 2023

Accrued Expenses and Other Current Liabilities.

Summary of accrued expenses and other current liabilities


	December 31, 2022	December 31, 2023
	RMB	RMB
Advertising and promotional expenses	33,048	25,196
Professional service fees	5,237	11,759
Payable for property, equipment and leasehold improvement, net	871	329
Payable for share repurchase program	—	949
Payable for remuneration fee of ADR program	—	3,517
Accrued sales rebates for advertising business	1,360	467
Provision for litigation contingencies	3,156	2,403
Others	3,950	3,890
Total	47,622	48,510

Cost of Revenues (Tables)

12 Months Ended

Dec. 31, 2023

Cost Of Revenues

Summary of cost of revenues


	For the year ended December 31,
	2021	2022	2023
	RMB	RMB	RMB
Revenue sharing fees	1,357,270	1,351,096	1,368,498
Salary and welfare benefits	52,268	40,653	45,273
Payment handling costs	32,506	22,899	21,076
Bandwidth costs	30,889	32,795	39,424
Share-based compensation expense	11,484	7,052	3,845
Others	18,088	14,426	8,281
Total	1,502,505	1,468,921	1,486,397

Significant Accounting Policies

12 Months Ended

Dec. 31, 2023

Significant Accounting Policies

Significant Accounting Policies

2.Significant Accounting Policies

Basis of presentation

The consolidated financial statements of the Group have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Significant accounting policies followed by the Group in the preparation of the accompanying consolidated financial statements are summarized below.

Principles of consolidation

The consolidated financial statements include the financial statements of the Company, its subsidiaries, the VIEs and subsidiaries of the VIEs for which the Company is the ultimate primary beneficiary.

Subsidiaries are those entities in which the Company, directly or indirectly, controls more than one half of the voting power, has the power to appoint or remove the majority of the members of the board of directors, or to cast a majority of votes at the meeting of the board of directors, or has the power to govern the financial and operating policies of the investee under a statute or agreement among the shareholders or equity holders.

A consolidated VIE is an entity in which the Company, or its subsidiary, through contractual arrangements, has the power to direct the activities that most significantly impact the entity’s economic performance, bears the risks of and enjoys the rewards normally associated with ownership of the entity, and therefore the Company or its subsidiary is the primary beneficiary of the entity for accounting purpose.

All transactions and balances among the Company, its subsidiaries, the VIEs and subsidiaries of the VIEs have been eliminated upon consolidation.

2.Significant Accounting Policies (Continued)

Use of estimates

The preparation of the Group’s consolidated financial statements in conformity with the U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent liabilities at the balance sheet date and reported revenues and expenses during the reported years in the consolidated financial statements and accompanying notes. Such accounting estimates include, but are not limited to, assessment of average user relationship period for podcast business, assessment for the impairment of long-lived assets, fair value measurement of short-term investments, provision for income taxes and valuation allowance for deferred tax assets, expected credit loss of financial instruments measured at amortized cost, fair value of ordinary shares and preferred shares before the IPO, and valuation and recognition of share-based compensation expenses.

Functional currency and foreign currency translation

The Group uses Renminbi (“RMB”) as its reporting currency. The Company and its overseas subsidiaries use United States dollars (“US$”) as their functional currency. The functional currency of the Group’s PRC entities is RMB.

In the consolidated financial statements, the financial information of the Company and other entities located outside of the PRC have been translated into RMB. Assets and liabilities are translated at the exchange rates on the balance sheet date, equity amounts are translated at historical exchange rates, and revenues, and expenses, gains and losses are translated using the average rate for the year. Translation adjustments are reported as foreign currency translation adjustments and are shown as a component of other comprehensive (loss)/income in the consolidated statements of operations and comprehensive (loss)/income.

Foreign currency transactions denominated in currencies other than the functional currency are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency using the applicable exchange rates at the balance sheet dates. Net gains and losses resulting from foreign exchange transactions are included in foreign exchange gains/(losses) in the consolidated statements of operations and comprehensive (loss)/income.

Convenience Translation

Translations of balances in the consolidated balance sheets, the consolidated statements of operations and comprehensive (loss)/income and the consolidated statements of cash flows from RMB into US$ as of and for the year ended December 31, 2023 are solely for the convenience of the reader and were calculated at the rate of US$1.00 = RMB7.0999, representing the noon buying rate in The City of New York for cable transfers of RMB as certified for customs purposes by the Federal Reserve Bank of New York on December 29, 2023. No representation is made that the RMB amounts could have been, or could be, converted, realized or settled into U.S. dollars at such rate or at any other rate.

Fair value measurements

Accounting guidance defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Group considers the principal or most advantageous market in which it would transact, and it considers assumptions that market participants would use when pricing the asset or liability.

Accounting guidance establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Accounting guidance establishes three levels of inputs that may be used to measure fair value:

●Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

2.	Significant Accounting Policies (Continued)

Fair value measurements (Continued)

●

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices included within Level 1 that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical asset or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

●	Level 3 applies to asset or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

The Group’s financial instruments include cash and cash equivalents, short-term investments, restricted cash, accounts receivable, other receivables (included in “Prepayments and other current assets”), accounts payable and other payables (included in “Accrued expenses and other current liabilities”), and short-term loans.

See Note 19 for additional information relating to fair value measurements as of December 31, 2023.

Cash and cash equivalents

Cash and cash equivalents mainly represent cash and demand deposits placed with financial institutions, and highly liquid investments that are readily convertible to known amounts of cash and with original maturities from the date of purchase with terms of three months or less. As of December 31, 2022 and 2023, the Group had cash held in accounts managed by online payment platforms such as Alipay and WeChat Pay in connection with the collection of service fees online for a total amount of RMB8.6 million and RMB12.4 million, respectively, which have been classified as cash and cash equivalents on the consolidated balance sheets.

As of December 31, 2022 and 2023, the Group had approximately RMB415.6 million and RMB360.5 million cash and cash equivalents held by its PRC subsidiaries and VIEs, representing 73.2% and 72.5% of total cash and cash equivalents of the Group, respectively. Cash transfers from the Company’s PRC subsidiaries and VIEs to their parent companies outside of China are subject to PRC government control of currency conversion. Shortages in the availability of foreign currency may temporarily restrict the ability of the PRC subsidiaries and consolidated affiliated entities to remit sufficient foreign currency to pay dividends or other payments to the Company, or otherwise satisfy their foreign currency denominated obligations.

The Group had no lien arrangements during the years ended December 31, 2021, 2022 and 2023.

Restricted cash

Cash that is restricted as to withdrawal or for use or pledged as security is reported separately on the consolidated balance sheets. As of December 31, 2023 and 2022, the Group’s restricted bank balances amounted to RMB 2.7 million and RMB 10.3 million, respectively. These restricted deposits were used as security for credit cards, overseas operating leases, and short-term loans.

i)Short-term investments

In accordance with ASC 825, for investments in financial instruments with a variable interest rate indexed to the performance of underlying assets, the Company elected the fair value method at the date of initial recognition and carried these investments subsequently at fair value. Changes in the fair value are reflected in the consolidated statements of operations and comprehensive (loss)/income. To estimate fair value, the Company refers to the quoted rate of return provided by financial institutions at the end of each period and classifies the valuation techniques that use these inputs as level 2 of fair value measurement. Since these investments’ maturity dates are within one year, they are classified as short-term investments.

2.	Significant Accounting Policies (Continued)

Receivables, net

Accounts receivable and other receivables recorded in prepayments and other current assets (collectively defined as “Receivables”) are stated at the historical carrying amount net of allowance for credit losses. On January 1, 2023, the Group adopted Accounting Standards Update No. 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASC 326”) using the modified retrospective transition method with the cumulative effect of initially applying the guidance recognized at the date of initial application. Prior to the adoption of ASC 326, an allowance for doubtful accounts of the Group’s receivables reflects the Group’s best estimate of the amounts that will not be collected. ASC 326 replaces the existing incurred loss impairment model with a forward-looking current expected credit loss (“CECL”) methodology.

To estimate expected credit losses, the Group has developed a CECL model with consideration of the historical collection experience, credit quality of its customers, current economic conditions, reasonable and supportable forecasts of future economic conditions, and other factors that may affect its ability to collect from customers.

Property, equipment and leasehold improvement, net

Property, equipment and leasehold improvement are stated at cost less accumulated depreciation and impairment, if any. Depreciation is computed using the straight-line method over the following estimated useful lives:


Electronic equipment		3 years
Furniture and office equipment		5 years
Vehicles		4 years
Leasehold improvement		shorter of expected lives of leasehold improvement and lease term

Expenditures for maintenance and repairs are expensed as incurred. The gain or loss on the disposal of property, equipment and leasehold improvement is the difference between the net sales proceeds and the carrying amount of the relevant assets and is recognized in the consolidated statements of operations and comprehensive (loss)/income.

l)Intangible assets, net

Intangible assets mainly consist of copyright, software, trademark and others. Identifiable intangible assets are carried at acquisition cost less accumulated amortization and impairment loss, if any. Finite-lived intangible assets are tested for impairment if impairment indicators arise. No impairment charge was recognized for any of the years presented. Amortization of finite-lived intangible assets is computed using the straight-line method over their estimated useful lives, which are as follows:


Copyright		1-3 years
Software		1-5 years
Trademark and others		3-5 years

Impairment of long-lived assets

Long-lived assets are evaluated for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be fully recoverable or that the useful life is shorter than the Group had originally estimated. When these events occur, the Group evaluates the impairment for the long-lived assets by comparing the carrying value of the assets to an estimate of future undiscounted cash flows expected to be generated from the use of the assets and their eventual disposition. If the sum of the expected future undiscounted cash flows is less than the carrying value of the assets, the Group recognizes an impairment loss based on the excess of the carrying value of the assets over the fair value of the assets. No impairment charge was recognized for any of the years presented.

2.	Significant Accounting Policies (Continued)

Revenue recognition

The Group’s revenues comprise audio entertainment revenue, podcast, advertising and other revenue. The Group recognizes revenue pursuant to ASC 606, revenue from contracts with customers (“ASC 606”). In accordance with ASC 606, revenue from contracts with customers is recognized when control of the promised goods or services is transferred to the Group’s customers, in an amount that reflects the consideration the Group expects to be entitled to in exchange for those goods or services. To achieve the core principle of this standard, the Group applied the following five steps: (i) identification of the contract, or contracts, with the customer; (ii) identification of the performance obligations in the contract; (iii) determination of the transaction price; (iv) allocation of the transaction price to the performance obligations in the contract; and (v) recognition of the revenue when, or as, a performance obligation is satisfied.

The following table summarizes the revenue by type of service provided by the Group:


	For the year ended December 31,
	2021	2022	2023
	RMB	RMB	RMB
Audio entertainment	2,101,475	2,174,314	2,063,346
Podcast, advertising and others	18,039	10,952	8,426
Total	2,119,514	2,185,266	2,071,772

The Group recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Group expects to receive in exchange for those goods or services.

Audio entertainment revenue

The Group is principally engaged in operating its own audio entertainment live streaming platform, which enable hosts and users to interact with each other during audio entertainment live streaming services. Audio entertainment revenue is generated from sales of virtual items on the platform. The Group has a recharge system for users to purchase the Group’s virtual currency which is then used to purchase virtual items for use. Users can recharge via bank transfer and various online third-party payment platforms, including AliPay, WeChat Pay and other payment platforms. Virtual currency is non-refundable and without expiry. The virtual currency is often consumed soon after it is purchased based on history of turnover of the virtual currency. Unconsumed virtual currency is recorded as deferred revenue. Virtual currencies used to purchase virtual items are recognized as revenue according to the prescribed revenue recognition policies of virtual items addressed below, unless otherwise stated.

The Group engages hosts to provide audio entertainment live streaming services. The Group shares a portion of the sales proceeds of virtual items (“revenue sharing fee”) with hosts and their respective guilds in accordance with their audio entertainment live streaming service agreements.

The Group evaluates and determines that it is the principal and views users to be its customers. The Group reports audio entertainment revenues on a gross basis. Accordingly, the amounts billed to users are recorded as revenues and revenue sharing fee paid to hosts and their respective guilds are recorded as cost of revenues. Where the Group is the principal, it controls the virtual items before they are transferred to users. Its control is evidenced by the Group’s sole ability to monetize the virtual items before they are transferred to users, and is further supported by the Group being primarily responsible to users and having a level of discretion in establishing pricing. The Group designs, creates and offers various virtual items for sale to users with pre-determined stand-alone selling price. Virtual items are categorized as either consumable or time-based items. Consumable items are consumed upon purchase while time-based items could be used for a fixed period of time such as a virtual special symbol that can be purchased and displayed on the users’ profile over a fixed period of time. Users can purchase either consumable or time-based items and present these virtual items to hosts to show support for their favorite hosts or purchase time-based virtual items that enhance the users’ personal profile.

2.	Significant Accounting Policies (Continued)

Revenue recognition (Continued)

Revenue related to each consumable item is a single performance obligation provided on a consumption basis and is recognized at the point in time when the virtual item is transferred directly to the users and consumed by them. Revenue related to time-based virtual items is recognized ratably over the fixed period on a straight-line basis. The Group does not have further performance obligations to users after the virtual items are consumed immediately or after the stated contract period for time-based items.

Podcast revenue

The Group provides users certain subscription services which entitle paying subscribers access to listen to specific podcast content on the platform. The subscription fee is time-based and is collected upfront from subscribers.

The receipt of subscription fee is initially recorded as deferred revenue. The Group satisfies its performance obligation by providing services throughout the estimated average user relationship period as the subscription period is generally perpetual. Revenue is recognized ratably over the estimated average user relationship period. The estimated average user relationship period is based on historical data collected from those paying users who have subscribed to podcast content. The Group estimates the average user relationship period for a podcast content to be the date a user subscribes to it through the date the Group estimates the paying user will listen to the content for the last time.

The determination of the estimated average user relationship period is based on the Group’s best estimate that considers all known and relevant information, including actual historical patterns of usage, at the time of assessment. Any adjustments arising from changes in the estimated average user relationship period as a result of new information is accounted as a change in accounting estimate.

The podcast contents are licensed by broadcasters to the Group. The Group records revenue on a gross basis considering that the Group: (i) is the primary obligor in the arrangement; and (ii) has latitude in establishing the selling price.

Contract liabilities

Contract liabilities primarily consist of deferred revenue which comprises unconsumed virtual currency, unamortized revenue from time-based virtual items and unamortized subscription fees for podcast services.

During the years ended December 31, 2021, 2022 and 2023, the Group recognized revenue amounted to RMB11.0 million, RMB12.5 million and RMB14.0 million, respectively, that was included in the corresponding opening deferred revenue balance of the year.

During the years ended December 31, 2021, 2022 and 2023, the Group did not have any arrangement where the performance obligations had already been satisfied in the past year but recognized the corresponding revenue in the current year.

Advertising revenue

The Group generates advertisement revenues from rendering various forms of advertisement services by way of advertisement display on its audio entertainment live streaming platform. Advertisements on the Group’s platform are generally charged on the basis of duration whereby revenue is recognized ratably over the contract period of display. The Group provides sales incentives in the forms of discounts and rebates to advertisement agencies based on purchase volume. Revenue is recognized based on the price charged to the advertisers or agencies, net of sales incentives provided to the agencies. Sales incentives are recorded at the time of revenue recognition based on the contracted rebate rates and contract amount.

2.	Significant Accounting Policies (Continued)

Revenue recognition (Continued)

Practical Expedients

The Group has used the following practical expedients as allowed under generally accepted accounting principles in the U.S.:

(i)

The transaction price allocated to performance obligations that are unsatisfied or partially unsatisfied has not been disclosed, as substantially all of the Group’s contracts have an original expected duration of one year or less.

(ii)

Payment terms and conditions vary by contract type, although terms generally include a requirement of prepayment or payment within one year or less. Accordingly, the Group has determined that its contracts generally do not include a significant financing component.

(iii)

Costs to obtain a contract with a customer are expensed as incurred when the amortization period is estimated to be one year or less.

Deferred revenue

Deferred revenue primarily consists of unconsumed virtual currency, unamortized revenue from time-based virtual items and unamortized subscription fees for podcast contents in the Group’s platform, where there is still an obligation to be provided by the Group, which will be recognized as revenue when all of the revenue recognition criteria are met.

Cost of revenue

Amounts recorded as cost of revenue relate to direct expenses incurred in order to generate revenue. Such costs are recorded as incurred. Cost of revenues consists primarily of revenue sharing fees, salary and welfare benefits, payment handling costs, bandwidth costs and other costs. Revenue sharing fees represent the Company’s payments to hosts or guilds based on a percentage of revenue from sales of virtual items and certain performance-based incentives.

Research and development expenses

Research and development expenses mainly consist of salary and welfare benefits and bandwidth costs incurred for the development and enhancement to the Company’s websites and platform of applications.

Selling and marketing expenses

Selling and marketing expenses consist primarily of advertising and promotional expenses, salary and welfare benefits to the Group’s sales and marketing personnel. Advertising and promotional expenses consist primarily of costs for the promotion of the Group’s corporate image and mobile app, and the organization of offline events between hosts and users. The Group expenses all advertising and promotional expenses as incurred and classifies them under selling and marketing expenses. For the years ended December 31, 2021, 2022 and 2023, advertising and promotional expenses were RMB360.2 million, RMB228.2 million and RMB202.6 million, respectively.

2.	Significant Accounting Policies (Continued)

Leases

The Group determines if an arrangement is a lease and determines the classification of the lease, as either operating or finance, at commencement. The Group adopted the accounting for leases beginning January 1, 2020 by applying the modified retrospective method to those contracts that were not completed as of January 1, 2020. There was no impact to retained earnings at adoption.

The Group elected to utilize the package of practical expedients at the time of adoption, which allowed the Group to: (1) not reassess whether any expired or existing contracts are or contain leases, (2) not reassess the lease classification of any expired or existing leases, and (3) not reassess initial direct costs for any existing leases. The Company also elected to utilize the short-term lease recognition exemption and, for those leases that qualified, the Group did not recognize operating lease right-of-use (“ROU”) assets or operating lease liabilities.

The Group has operating leases for office buildings and has no finance leases as of December 31, 2022 and 2023. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the lease payments over the lease term at commencement date.

As the Group’s leases do not provide an implicit rate, an incremental borrowing rate is used based on the information available at the commencement date, to determine the present value of lease payments. The incremental borrowing rate approximates the rate the Group would pay to borrow in the currency of the lease payments for the weighted-average life of the lease.

The operating lease ROU assets also include any lease payments made prior to lease commencement and exclude lease incentives and initial direct costs incurred if any. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Group will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term.

The Group’s lease agreements contain both lease and non-lease components, which are accounted for separately based on their relative standalone price.

Government grants

Government grants represent cash subsidies received from the PRC government by the Group. Government grants are in connection with the Group’s contributions to research and development activities, and additional deduction of Value Added Tax (“VAT”) input in local business districts.

2.	Significant Accounting Policies (Continued)

Share-based compensation

Share-based compensation expenses arise from share-based awards, including share options for the purchase of ordinary shares, restricted shares and restricted share units.

Share-based compensation expenses are recognized in the consolidated financial statements based on their grant date fair values. The fair value of share option is affected by the fair value of ordinary shares as well as assumptions regarding complex and subjective variables, including: (i) the expected volatility of the fair value of ordinary shares, (ii) actual and projected employee share option exercise behavior, (iii) risk-free interest rates and (iv) expected dividends. The fair value of restricted share, restricted share units and share options with little to no exercise price, are generally measured as the grant date price of the Company’s ordinary shares.

The Company has never declared or paid any cash dividends on its capital stock, and the Group does not anticipate any dividend payments in the foreseeable future. The contractual term is the contract life of the options. The Group estimated the risk-free interest rate based on the market yield of US Government Bonds with maturities of ten years as of the valuation date, plus a country default risk spread between China and US. All share-based awards granted as of the years presented herein were granted with little to no exercise price and, accordingly, fair value was measured as the grant date price of the Company’s ordinary shares.

Share-based compensation expenses are recorded net of actual forfeitures. For a cliff-vesting award or an award with graded-vesting features and service conditions only, the Company uses the straight-line method to recognize compensation cost over the total requisite service period for the entire award. For an award with performance and/or service condition that affects vesting, the performance and/or service condition is not considered in determining the award’s fair value on the grant date. The Company recognizes compensation expenses for awards with performance conditions if, and when, the Company concludes that it is probable that the performance condition will be achieved, net of actual pre-vesting forfeitures over the requisite service period, using a graded-vesting method. The Company reassesses the probability of vesting at each reporting period for awards with performance conditions and adjusts compensation expense based on its probability assessment, unless the Company is not able to determine that it is probable that a performance condition will be satisfied until the event occurs.

2.	Significant Accounting Policies (Continued)

Employee benefits

PRC Contribution Plan

Full time employees of the Group in the PRC participate in a government mandated defined contribution plan, pursuant to which certain pension benefits, medical care, employee housing fund and other welfare benefits are provided to the employees. Chinese labor regulations require that the PRC subsidiaries, VIEs and subsidiaries of the VIEs of the Group make contributions to the government for these benefits based on certain percentages of the employees’ salaries, up to a maximum amount specified by the local government. The Group has no legal obligation for the benefits beyond the contributions made. The total amounts of such employee benefit expenses were approximately RMB57.2 million, RMB53.9 million and RMB46.4 million for the years ended December 31, 2021, 2022 and 2023, respectively.

Taxation

Income taxes

Current income taxes are provided on the basis of income/(loss) for financial reporting purposes, adjusted for income and expense items which are not assessable or deductible for income tax purposes, in accordance with the regulations of the relevant tax jurisdictions. Deferred income tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and any tax loss and tax credit carry forwards. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in tax rates or tax laws is recognized in the consolidated statements of operations in the period the change in tax rates or tax laws is enacted. A valuation allowance is provided to reduce the amount of deferred income tax assets if it is considered more likely than not that some portion or all of the deferred income tax assets will not be realized.

Uncertain tax positions

In order to assess uncertain tax positions, the Group applies a more likely than not threshold and a two-step approach for the tax position measurement and financial statement recognition. Under the two-step approach, the first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. The Group recognizes interest and penalties, if any, under accrued expenses and other current liabilities on its consolidated balance sheet and under other expenses in its consolidated statement of operations and comprehensive (loss)/income. The Group did not have any significant unrecognized uncertain tax positions as of and for the years ended December 31, 2021, 2022 and 2023.

Related parties

Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject to common control or significant influence, such as a family member or relative, shareholder, or a related corporation.

2.	Significant Accounting Policies (Continued)

Net (loss)/income per share

Basic net (loss)/income per share is computed using the weighted average number of ordinary shares outstanding during the period. Diluted net (loss)/income per share is computed using the weighted average number of ordinary shares and potential ordinary shares outstanding during the period under treasury stock method. Potential ordinary shares include options to purchase ordinary shares, restricted shares and restricted share units, unless they were anti-dilutive. The computation of diluted net (loss)/income per share does not assume conversion, exercise, or contingent issuance of securities that would have an anti-dilutive effect (i.e., an increase in earnings per share amounts or a decrease in loss per share amounts) on net (loss)/income per share.

The Group used the two-class method of computing basic earnings per share before the IPO in January 2020. The two-class method is used for computing earnings per share in the event the Group has net income available for distribution. Under the two-class method, net income is allocated between ordinary shares and participating securities based on dividends declared (or accumulated) and participating rights in undistributed earnings as if all the earnings for the reporting period had been distributed. The Company’s preferred shares were participating securities because they were entitled to receive dividends or distributions on an as converted basis. Upon the completion of the Company’s IPO in January 2020, the preferred shares were automatically converted into ordinary shares. The two-class method of computing net (loss)/income per share ceased to apply on the conversion date.

Statutory reserves

In accordance with China’s Company Laws, the Company’s VIEs and subsidiaries of the VIEs in PRC must make appropriations from their after-tax profit, if any (as determined under the accounting principles generally acceptable in the People’s Republic of China (“PRC GAAP”)) to non-distributable reserve funds including (i) statutory surplus fund and (ii) discretionary surplus fund. The appropriation to the statutory surplus fund must be at least 10% of the after-tax profits calculated in accordance with PRC GAAP. Appropriation is not required if the statutory surplus fund has reached 50% of the registered capital of the respective company. Appropriation to the discretionary surplus fund is made at the discretion of the respective company.

Pursuant to the laws applicable to China’s Foreign Investment Enterprises, the Company’s subsidiaries that are foreign investment enterprises in China have to make appropriations from their after-tax profit, if any (as determined under PRC GAAP) to reserve funds including (i) general reserve fund, (ii) enterprise expansion fund and (iii) staff bonus and welfare fund. The appropriation to the general reserve fund must be at least 10% of the after-tax profits calculated in accordance with PRC GAAP. Appropriation is not required if the general reserve fund has reached 50% of the registered capital of the subsidiary. Appropriations to the other two reserve funds are at the subsidiary’s discretion.

For the years ended December 31, 2021, 2022 and 2023, appropriations to general reserve fund and statutory surplus fund amounted to nil,RMB0.5 million and RMB1.6 million, respectively.

aa)Comprehensive (loss)/income

Comprehensive (loss)/income is defined to include all changes in (deficit)/equity of the Group during a period arising from transactions and other events and circumstances excluding transactions resulting from investments by shareholders and distributions to shareholders. Other comprehensive (loss)/income, as presented on the consolidated balance sheets, consists of accumulated foreign currency translation adjustments.

bb)Segment reporting

The Group uses the management approach in determining reportable operating segments. The management approach considers the internal organization and reporting used by the Group’s chief operating decision maker for making operating decisions, allocating resources and assessing performance as the source for determining the Group’s reportable segments. Management has determined that the Group operates in one segment.

2.	Significant Accounting Policies (Continued)

cc)Concentration and credit risk

Advertising and promotional service providers

The Group relied on advertising and promotional service providers and their affiliates to promote its platform and enhance brand awareness through a variety of online and offline marketing and brand promotion activities. The number of advertising and promotional service providers during the years ended December 31, 2021, 2022 and 2023 are as follows:


	For the year ended December 31,
	2021		2022		2023
Total number of advertising and promotional service providers	198		182		121
Number of service providers that each accounted for 10% or more of the Group’s advertising and promotional expenses	2		2		3
Total percentage of the Group’s advertising and promotional expenses that were paid to these service providers who each accounted for 10% or more of the Group’s advertising and promotional service expenses	44.9	%	35.7	%	59.4	%

Credit risk

Financial instruments that potentially subject the Group to the concentration of credit risk consist of cash and cash equivalents, short-term investments, restricted cash, accounts receivable and other receivables (recorded in “Prepayments and other current assets”). As of December 31, 2022 and 2023, substantially all of the Group’s cash and cash equivalents, restricted cash and short-term investments were held in financial institutions which management consider being of high credit quality. Under Chinese mainland law, it is generally required that a commercial bank in the Chinese mainland that holds third party cash deposits protect the depositors’ rights over and interests in their deposited money. Banks in the Chinese mainland are subject to a series of risk control regulatory standards, and bank regulatory authorities in the Chinese mainland are empowered to take over the operation and management of any Chinese mainland bank that faces a material credit crisis. Accounts receivable is typically unsecured and is generally derived from revenue earned from advertising business.

The risk with respect to accounts receivable is mitigated by credit evaluations the Group performs on the payment platforms, customers and the ongoing monitoring process of outstanding balances.

The Group is exposed to certain default risk with respect to its receivables from a third-party financial institution, as disclosed in Note 5 and Note 21. The Group has conducted credit evaluations of its receivables from the financial institution on an individual or collective basis. The Group concluded that the receivables are subject to a risk of default. Consequently, the Company has recorded an allowance for credit loss provision amounting to RMB90.7 million (US$12.8 million) for the receivables in the consolidated statements of operations and comprehensive (loss)/income for the year ended December 31, 2023.

Major customers for advertising business

There were two and two customers that had receivable balances derived from advertising business exceeding l0% of the total accounts receivable balances of the Group as of December 31, 2022 and 2023, respectively, as follows:


	December 31,		December 31,
	2022		2023
Customer A	71.6	%	69.9	%
Customer B	27.8	%	0.0	%
Customer C	0.0	%	30.1	%

2.	Significant Accounting Policies (Continued)

dd)

Recently issued accounting pronouncements

The Group qualifies as an “emerging growth company”, or “EGC”, pursuant to the Jumpstart Our Business Startups Act of 2012, as amended, or the JOBS Act. As an EGC, the Group does not need to comply with any new or revised financial accounting standards until such date that a private company is otherwise required to comply with such new or revised accounting standards.

Recently adopted accounting pronouncements

In November 2023, the FASB issued ASU 2023-07, which modifies the disclosure and presentation requirements of reportable segments. The new guidance requires the disclosure of significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within each reported measure of segment profit and loss. In addition, the new guidance enhances interim disclosure requirements, clarifies circumstances in which an entity can disclose multiple segment measures of profit or loss, provides new segment disclosure requirements for entities with a single reportable segment, and contains other disclosure requirements. The update is effective for annual periods beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The Group does not expect that the adoption of ASU 2023-07 will have a material impact on its consolidated financial statements disclosures.

In December 2023, the FASB issued ASU 2023-09 to improve its income tax disclosure requirements. Under the new guidance, public business entities must annually disclose specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold (if the effect of those reconciling items is equal to or greater than 5 percent of the amount computed by multiplying pretax income (loss) by the applicable statutory income tax rate). The new standard is effective for fiscal years beginning after December 15, 2024. The Group is in the process of evaluating the impact of adopting this new guidance on our consolidated financial statement disclosures.

Ordinary Shares and treasury shares (Details) $ / shares in Units, $ in Thousands		12 Months Ended
	Dec. 13, 2023 USD ($)	Dec. 31, 2023 USD ($) Vote $ / shares shares	Dec. 31, 2022 shares
Ordinary Shares
Ordinary shares, shares authorized		1,500,000,000
Aggregate value \| $	$ 3,000
Period in force	12 months
Aggregate consideration \| $		$ 130
Class A ordinary shares
Ordinary Shares
Ordinary shares, shares authorized		1,268,785,000	1,268,785,000
Number of votes per ordinary share \| Vote		1
Repurchase of common shares (Shares)		9,165,200
Average price (in dollars per shares) \| $ / shares		$ 0.0146
Class B ordinary shares
Ordinary Shares
Ordinary shares, shares authorized		231,215,000	231,215,000
Number of votes per ordinary share \| Vote		10
Number of Class A ordinary shares to be issued during conversion		1
American Depositary Shares
Ordinary Shares
Repurchase of common shares (Shares)		45,826
Average price (in dollars per shares) \| $ / shares		$ 2.9233

Taxation - Additional Information (Details) ¥ in Thousands, $ in Thousands		12 Months Ended
	Apr. 01, 2018	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)	Dec. 31, 2019
Taxation
Statutory income tax rate of the PRC		25.00%	25.00%	25.00%	25.00%
Withholding income tax percentage						10.00%
Percentage of share holding in FIE						25.00%
Withholding tax amount		¥ 0		¥ 0
Income tax expense/(credit)		¥ 434	$ 61	¥ 207	¥ 376
HONG KONG \| Inland Revenue, Hong Kong \| Minimum
Taxation
Withholding income tax percentage						5.00%
CHINA \| State Administration of Taxation, China
Taxation
Statutory income tax rate of the PRC		25.00%	25.00%
Preferential tax rate		15.00%	15.00%	15.00%	15.00%
HNTE reapply status		3 years	3 years
SINGAPORE
Taxation
Statutory income tax rate of the PRC		17.00%	17.00%
Withholding income tax percentage		0.00%	0.00%
Income tax expense/(credit)		¥ (100)		¥ 100	¥ 300
Assessable profits on the first HK$2 million \| HONG KONG \| Inland Revenue, Hong Kong
Taxation
Statutory income tax rate of the PRC	8.25%
Assessable profits in excess of HK$2 million \| HONG KONG \| Inland Revenue, Hong Kong
Taxation
Statutory income tax rate of the PRC	16.50%

Share-based Compensation - Summary of Company's stock options activities (Details) ¥ in Thousands, shares in Thousands	12 Months Ended
	Dec. 31, 2023 $ / shares shares	Dec. 31, 2023 CNY (¥) shares	Dec. 31, 2022 $ / shares shares	Dec. 31, 2022 CNY (¥) shares	Dec. 31, 2021 $ / shares shares	Dec. 31, 2021 CNY (¥) shares	Dec. 31, 2020 CNY (¥) shares
Share-based Compensation
Number of Options - Beginning balance		61,514		50,560		38,667
Number of Options - Granted		15,593		24,924		32,389
Number of Options - Exercised		(4,632)		(7,894)		(4,925)
Number of Options - Forfeited		(326)		(6,076)		(15,571)
Number of Options - Ending balance		72,149		61,514		50,560	38,667
Number of Options - Exercisable	37,674	37,674	17,103	17,103	8,557	8,557
Weighted average exercise price, Beginning balance \| $ / shares	$ 0.0001		$ 0.0001		$ 0.0001
Weighted average exercise price, Granted \| $ / shares	0.0001		0.0001		0.0001
Weighted average exercise price, Exercised \| $ / shares	0.0001		0.0001		0.0001
Weighted average exercise price, Forfeited \| $ / shares	0.0001		0.0001		0.0001
Weighted average exercise price, Ending balance \| $ / shares	0.0001		0.0001		0.0001
Options, Exercisable, Weighted Average Exercise Price \| $ / shares	$ 0.0001		$ 0.0001		$ 0.0001
Options, Outstanding, Weighted Average Remaining Contractual Term		2 years 1 month 28 days		2 years 11 months 23 days		2 years 6 months 21 days	3 years 1 month 2 days
Aggregated intrinsic value, Beginning balance \| ¥		¥ 13,452		¥ 29,786		¥ 48,921
Aggregated intrinsic value, Ending balance \| ¥		6,950		13,452		29,786	¥ 48,921
Aggregated intrinsic value, Option exercisable \| ¥		¥ 3,629		¥ 3,740		¥ 5,041
Employees
Share-based Compensation
Number of Options - Beginning balance		60,651		49,697		37,804
Number of Options - Granted		15,593		24,924		32,389
Number of Options - Exercised		(4,632)		(7,894)		(4,925)
Number of Options - Forfeited		(326)		(6,076)		(15,571)
Number of Options - Ending balance		71,286		60,651		49,697	37,804
Number of Options - Exercisable	36,811	36,811	16,421	16,421	8,216	8,216
Consultants
Share-based Compensation
Number of Options - Beginning balance		863		863		863
Number of Options - Ending balance		863		863		863	863
Number of Options - Exercisable	863	863	682	682	341	341

Short-term Loans (Details) - CNY (¥) ¥ in Thousands	12 Months Ended
Short-term Loans (Details) - CNY (¥) ¥ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Short-term Loans
Short-term loans		¥ 73,765
Bank credit facilities
Short-term Loans
Maximum borrowing capacity of bank credit facilities	¥ 102,600
Unused credit line amount	¥ 102,600
Short term debt weighted average interest rate percentage over time	0.00%	4.60%
Short-term loans	¥ 0	¥ 73,800
Bank credit facilities \| Maximum
Short-term Loans
Short term debt term	6 months	6 months

ADDITIONAL INFORMATION: CONDENSED FINANCIAL STATEMENTS OF PARENT COMPANY - CONDENSED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME (Details) ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)
Operating expenses:
Total Operating expenses	¥ (733,043)	$ (103,247)	¥ (649,694)	¥ (755,527)
Other expenses:
Others, net	(3,577)	(504)	1,944	(479)
Net (loss)/income	(134,515)	(18,947)	86,504	(127,250)
Net (loss)/income attributable to the Sound Group Inc.'s ordinary shareholders	(126,651)	(17,839)	86,517	(127,250)
Net (loss)/income	(134,515)	(18,947)	86,504	(127,250)
Other comprehensive (loss)/income:
Foreign currency translation adjustments	3,277	462	24,314	(7,848)
Total other comprehensive (loss)/income	3,277	462	24,314	(7,848)
Comprehensive (loss)/income attributable to the Sound Group Inc.'s ordinary shareholders	(123,285)	$ (17,365)	110,831	(135,098)
Parent company \| Reportable legal entity
Operating expenses:
Total Operating expenses	(107,380)		(15,966)	(19,010)
Other expenses:
(Loss)/income from subsidiaries	(14,852)		100,300	(109,046)
Others, net	(4,419)		2,183	806
Net (loss)/income	(126,651)		86,517	(127,250)
Net (loss)/income attributable to the Sound Group Inc.'s ordinary shareholders	(126,651)		86,517	(127,250)
Net (loss)/income	(126,651)		86,517	(127,250)
Other comprehensive (loss)/income:
Foreign currency translation adjustments	3,366		24,314	(7,848)
Total other comprehensive (loss)/income	3,366		24,314	(7,848)
Comprehensive (loss)/income attributable to the Sound Group Inc.'s ordinary shareholders	¥ (123,285)		¥ 110,831	¥ (135,098)

ADDITIONAL INFORMATION: CONDENSED FINANCIAL STATEMENTS OF PARENT COMPANY - CONDENSED BALANCE SHEETS (Details) ¥ in Thousands, $ in Thousands	Dec. 31, 2023 CNY (¥)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 CNY (¥)
Current assets:
Cash and cash equivalents	¥ 494,965	$ 69,700	¥ 568,192	¥ 533,293
Short-term investments			111,353
Prepayments and other current assets	33,914	4,777	30,391
Total current assets	533,088	75,084	723,492
Non-current assets:
Total non-current assets	33,486	4,716	52,845
TOTAL ASSETS	566,574	79,800	776,337
Current liabilities:
Salary and welfare payable	136,869	19,277	136,837
Accrued expenses and other current liabilities	48,510	6,835	47,622
Total current liabilities	272,625	38,400	371,526
Non-current liabilities:
Other non-current liabilities			3,952
Total non-current liabilities	3,936	554	12,147
TOTAL LIABILITIES	276,561	38,954	383,673
SHAREHOLDERS' EQUITY
Treasury stock	(958)	(135)	(10)
Other shareholders' equity	17,923	2,524	14,557
TOTAL Sound Group Inc.'s SHAREHOLDERS' EQUITY	299,475	42,179	392,677
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	566,574	79,800	776,337
Class A ordinary shares
SHAREHOLDERS' EQUITY
Ordinary shares	557	78	543
Class B ordinary shares
SHAREHOLDERS' EQUITY
Ordinary shares	168	$ 24	168
Parent company \| Reportable legal entity
Current assets:
Cash and cash equivalents	70,544		93,673
Short-term investments			91,339
Amounts due from Sound Group Companies	¥ 471,614		¥ 359,675
Other Receivable, after Allowance for Credit Loss, Current, Related Party, Type [Extensible Enumeration]	srt:AffiliatedEntityMember	srt:AffiliatedEntityMember	srt:AffiliatedEntityMember
Prepayments and other current assets	¥ 1,697		¥ 2,313
Total current assets	543,855		547,000
Non-current assets:
Deficit in subsidiaries	(149,402)		(130,257)
Total non-current assets	(149,402)		(130,257)
TOTAL ASSETS	394,453		416,743
Current liabilities:
Salary and welfare payable	2,066		2,487
Accrued expenses and other current liabilities	13,016		1,683
Amounts due to Sound Group Companies	¥ 79,896		¥ 15,944
Other Liability, Current, Related Party, Type [Extensible Enumeration]	srt:AffiliatedEntityMember	srt:AffiliatedEntityMember	srt:AffiliatedEntityMember
Total current liabilities	¥ 94,978		¥ 20,114
Non-current liabilities:
Other non-current liabilities			3,952
Total non-current liabilities			3,952
TOTAL LIABILITIES	94,978		24,066
SHAREHOLDERS' EQUITY
Treasury stock	(958)		(10)
Other shareholders' equity	299,708		391,976
TOTAL Sound Group Inc.'s SHAREHOLDERS' EQUITY	299,475		392,677
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	394,453		416,743
Parent company \| Reportable legal entity \| Class A ordinary shares
SHAREHOLDERS' EQUITY
Ordinary shares	557		543
Parent company \| Reportable legal entity \| Class B ordinary shares
SHAREHOLDERS' EQUITY
Ordinary shares	¥ 168		¥ 168

Fair Value Measurement - Summary of fair value, assets and liabilities measured on nonrecurring basis (Details) - Non-recurring - CNY (¥) ¥ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Fair Value Measurement
Financial assets at fair value	¥ 0	¥ 0
Financial liabilities at fair value	¥ 0	¥ 0

Fair Value Measurement

12 Months Ended

Dec. 31, 2023

Fair Value Measurement

Fair Value Measurement

19.Fair Value Measurement

Recurring

When available, the Group uses quoted market prices to determine the fair value of an asset or liability. If quoted market prices are not available, the Group will measure fair value using valuation techniques that use, when possible, current market-based or independently sourced market parameters, such as interest rate and currency rate.

The following table sets forth the Company’s financial instruments measured or disclosed at fair value on a recurring basis by level within the fair value hierarchy as of December 31, 2022. No balance of financial instruments measured or disclosed at fair value on a recurring basis as of December 31, 2023.


	Fair Value Measurement at
	December 31, 2022 Using
	Quoted Prices	Significant
	in Active Market	Other	Unobservable	Fair Value at
	for Identical	Observable	inputs	December 31,
	Assets (Level 1)	Inputs (Level 2)	(Level 3)	2022
	RMB	RMB	RMB	RMB	US$
Short-term investments	—	111,353	—	111,353	16,145
Total	—	111,353	—	111,353	16,145

The Company’s other financial instruments, including cash and cash equivalents, restricted cash, accounts receivable, other receivables (included in “Prepayments and other current assets”), accounts payable, other payables (included in “Accrued expenses and other current liabilities”) and short-term loans are not measured at fair value in the consolidated balance sheets, as their carrying values approximated fair value due to their short-term maturity.

Non-recurring

As of December 31, 2022 and 2023, the group had no financial assets or financial liabilities that are measured at fair value at non-recurring basis. The Group’s non-financial assets, such as intangible assets, property, equipment and leasehold improvement and other non-current assets, would be measured at fair value on non-recurring basis whenever events or changes in circumstances indicate that the carrying value may no longer be recoverable.

Share-based Compensation - Additional Information (Details) ¥ / shares in Units, $ / shares in Units, ¥ in Thousands, $ in Millions	12 Months Ended
	Dec. 31, 2023 CNY (¥) $ / shares shares	Dec. 31, 2023 CNY (¥) D ¥ / shares shares	Dec. 31, 2022 CNY (¥) ¥ / shares shares	Dec. 31, 2021 CNY (¥) ¥ / shares shares	Dec. 31, 2023 USD ($) shares	Sep. 17, 2021 shares	Mar. 18, 2020 shares	Mar. 17, 2020 shares
Share-based Compensation
Ordinary shares, shares authorized	1,500,000,000	1,500,000,000			1,500,000,000
Cash settled equity instrument granted under share-based payment arrangements \| ¥		¥ 0	¥ 0	¥ 0
Compensation cost for share-based payment arrangements \| ¥		¥ 0	¥ 0	¥ 0
Weighted average grant date fair value of options granted \| (per share)	$ 0.03	¥ 0.19	¥ 0.28	¥ 1.44
Vesting of restricted share units (in shares)		7,989,200	5,637,860	1,812,960
common Class A
Share-based Compensation
Ordinary shares, shares authorized	1,268,785,000	1,268,785,000	1,268,785,000		1,268,785,000
Restricted shares
Share-based Compensation
Vesting of restricted share units (in shares)			3,625,000	6,232,000
Restricted share units
Share-based Compensation
Award vesting period		4 years
Restricted shares units, granted		6,687,500	2,192,900	13,080,200
Threshold number of trading days before vesting day \| D		30
Vesting of restricted share units (in shares)		9,148,000	3,649,000	3,018,000
Restricted share units \| Minimum
Share-based Compensation
Award vesting period		1 year
Restricted share units \| Maximum
Share-based Compensation
Award vesting period		4 years
2019 Incentive Plan and the Amended and Restated 2019 Share Incentive Plan
Share-based Compensation
Unrecognized compensation expenses, unvested awards	$ 26,500	¥ 26,500	¥ 62,500		$ 3.8
Unrecognized compensation expenses, weighted average period for recognition		2 years 1 month 28 days	2 years 11 months 4 days
2019 Incentive Plan \| common Class A
Share-based Compensation
Ordinary shares, shares authorized						100,000,000	100,000,000	40,000,000
2019 Incentive Plan \| common Class A \| Restated
Share-based Compensation
Ordinary shares, shares authorized						170,000,000
2019 Incentive Plan \| common Class A \| Minimum
Share-based Compensation
Award vesting period		0 years
2019 Incentive Plan \| common Class A \| Maximum
Share-based Compensation
Award vesting period		4 years
2018 Incentive Plan
Share-based Compensation
Award vesting period		4 years

Net (Loss)/Income per Share - Summary of antidilutive securities excluded from computation of earnings per share (Details)	12 Months Ended
	Dec. 31, 2021 shares
Net (loss)/income per Share
Total	15,179,612
Share options
Net (loss)/income per Share
Total	7,036,117
Restricted shares
Net (loss)/income per Share
Total	5,680,877
Restricted share units
Net (loss)/income per Share
Total	2,462,618

Ordinary Shares and treasury shares

12 Months Ended

Dec. 31, 2023

Ordinary Shares and treasury shares

Ordinary Shares and treasury shares

13.Ordinary Shares and treasury shares

The authorized share capital of the Company was 1,500,000,000 shares comprising of (i) 1,268,785,000 Class A ordinary shares; (ii) 231,215,000 Class B ordinary shares. The rights of the holders of Class A and Class B ordinary shares are identical, except with respect to voting and conversion right. Each share of Class A ordinary shares is entitled to one vote per share and is not convertible into Class B ordinary shares under any circumstances. Each share of Class B ordinary shares is entitled to ten votes per share and is convertible into one Class A ordinary share at any time by the holder thereof. Upon any sale, transfer, assignment or disposition of any Class B ordinary shares by a holder thereof to any person who is not a Founder or an affiliate of a Founder, or upon a change of beneficial ownership of any Class B ordinary shares as a result of which any person who is not a Founder or an affiliate of a Founder becomes a beneficial owner of such Class B ordinary shares, each of such Class B ordinary shares will be automatically and immediately converted into one Class A ordinary share.

Prior to the completion of the IPO in January 2020, the Company issued several series of convertible redeemable preferred shares (collectively referred to as the “Preferred Shares”), these preferred shares have certain preferred rights and the Group has classified them in the mezzanine equity of the consolidated balance sheets. In addition, the Group records accretions on the Preferred Shares to the redemption value from the issuance dates to the earliest redemption dates. The accretions are recorded against retained earnings, or in the absence of retained earnings, by charges against additional paid-in capital. Once additional paid-in capital has been exhausted, additional charges are recorded by increasing the accumulated deficit. All series of Preferred Shares were automatically converted into Class A ordinary shares upon the Company’s IPO in January 2020. Accordingly, no additional accretion has been recorded since conversion and no mezzanine equity recorded since completion of the IPO.

On December 13, 2023, the Company announced a share repurchase program under which the Company repurchase its Class A ordinary shares with an aggregate value of up to US$3 million over the next 12-month period. The share repurchases may be made from time to time in the open market at prevailing market prices, in privately negotiated transactions, in block trades and/or through other legally permissible means, depending on market conditions and in accordance with applicable rules and regulations. The Company repurchased an aggregate of 45,826 ADSs, representing 9,165,200 Class A ordinary shares from the open market at an average price of US$2.9233 per ADS or US$0.0146 per Class A ordinary shares, for aggregate consideration of US$0.13 million during the year ended December 31, 2023. The repurchased shares have not been cancelled by the end of 2023 and are reflected as treasury stock.

- Definition

The entire disclosure for equity.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-14

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 235
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481062/946-235-50-2

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 235
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481062/946-235-50-2

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 505
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481004/946-505-50-6

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 815
-SubTopic 40
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480237/815-40-50-6

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480008/505-10-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(e)(1))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 505
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//505/tableOfContent

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (g)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (i)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-14

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-14

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 16
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-16

Reference 17: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 18
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-18

Reference 18: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 18
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-18

Reference 19: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 18
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-18

+ Details

Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2023

Significant Accounting Policies

Basis of presentation

Basis of presentation

Principles of consolidation

Principles of consolidation

All transactions and balances among the Company, its subsidiaries, the VIEs and subsidiaries of the VIEs have been eliminated upon consolidation.

Use of estimates

Use of estimates

Functional currency and foreign currency translation

Functional currency and foreign currency translation

Convenience Translation

Convenience Translation

Fair value measurements

Fair value measurements

●Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

●

●	Level 3 applies to asset or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

See Note 19 for additional information relating to fair value measurements as of December 31, 2023.

Cash and cash equivalents

Cash and cash equivalents

The Group had no lien arrangements during the years ended December 31, 2021, 2022 and 2023.

Restricted cash

Restricted cash

Short-term investments

i)Short-term investments

Receivables, net

Receivables, net

Property, equipment and leasehold improvement, net

Property, equipment and leasehold improvement, net


Electronic equipment		3 years
Furniture and office equipment		5 years
Vehicles		4 years
Leasehold improvement		shorter of expected lives of leasehold improvement and lease term

Intangible assets, net

l)Intangible assets, net


Copyright		1-3 years
Software		1-5 years
Trademark and others		3-5 years

Impairment of long-lived assets

Impairment of long-lived assets

Revenue recognition

Revenue recognition

The following table summarizes the revenue by type of service provided by the Group:


	For the year ended December 31,
	2021	2022	2023
	RMB	RMB	RMB
Audio entertainment	2,101,475	2,174,314	2,063,346
Podcast, advertising and others	18,039	10,952	8,426
Total	2,119,514	2,185,266	2,071,772

Audio entertainment revenue

2.	Significant Accounting Policies (Continued)

Revenue recognition (Continued)

Podcast revenue

Contract liabilities

Advertising revenue

Practical Expedients

The Group has used the following practical expedients as allowed under generally accepted accounting principles in the U.S.:

(i)

(ii)

(iii)

Costs to obtain a contract with a customer are expensed as incurred when the amortization period is estimated to be one year or less.

Deferred revenue

Deferred revenue

Cost of revenue

Cost of revenue

Research and development expenses

Research and development expenses

Selling and marketing expenses

Selling and marketing expenses

Leases

Leases

The Group’s lease agreements contain both lease and non-lease components, which are accounted for separately based on their relative standalone price.

Government grants

Government grants

Share-based compensation

Share-based compensation

Share-based compensation expenses arise from share-based awards, including share options for the purchase of ordinary shares, restricted shares and restricted share units.

Employee benefits

Employee benefits

PRC Contribution Plan

Taxation

Taxation

Income taxes

Uncertain tax positions

Related parties

Related parties

Net (loss)/income per share

Net (loss)/income per share

Statutory reserves

Statutory reserves

For the years ended December 31, 2021, 2022 and 2023, appropriations to general reserve fund and statutory surplus fund amounted to nil,RMB0.5 million and RMB1.6 million, respectively.

Comprehensive (loss)/income

aa)Comprehensive (loss)/income

Segment reporting

bb)Segment reporting

Concentration and credit risk

cc)Concentration and credit risk

Advertising and promotional service providers


	For the year ended December 31,
	2021		2022		2023
Total number of advertising and promotional service providers	198		182		121
Number of service providers that each accounted for 10% or more of the Group’s advertising and promotional expenses	2		2		3
Total percentage of the Group’s advertising and promotional expenses that were paid to these service providers who each accounted for 10% or more of the Group’s advertising and promotional service expenses	44.9	%	35.7	%	59.4	%

Credit risk

The risk with respect to accounts receivable is mitigated by credit evaluations the Group performs on the payment platforms, customers and the ongoing monitoring process of outstanding balances.

Major customers for advertising business


	December 31,		December 31,
	2022		2023
Customer A	71.6	%	69.9	%
Customer B	27.8	%	0.0	%
Customer C	0.0	%	30.1	%

Recently issued accounting pronouncements

dd)

Recently issued accounting pronouncements

Recently adopted accounting pronouncements

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY ¥ in Thousands, $ in Thousands	Ordinary shares CNY (¥) shares	Treasury stock CNY (¥) shares	Additional paid-in capital CNY (¥)	Statutory reserves CNY (¥)	Accumulated other comprehensive (loss)/income CNY (¥)	Accumulated deficit CNY (¥)	Non-controlling interests CNY (¥)	CNY (¥) shares	USD ($) shares
Beginning balance at Dec. 31, 2020	¥ 640	¥ (12)	¥ 2,409,753		¥ (1,909)	¥ (2,239,281)		¥ 169,191
Beginning balance (in shares) at Dec. 31, 2020 \| shares	941,464,520
Beginning balance (in shares) at Dec. 31, 2020 \| shares		(17,146,070)
Statement
Net income (loss)						(127,250)		(127,250)
Issuance of ordinary shares at the follow-on public offering	¥ 48		183,140					183,188
Issuance of ordinary shares at the follow-on public offering (in shares) \| shares	73,710,080
Share-based compensation			34,715					34,715
Issuance of treasury stock for share incentive plan	¥ 10	¥ (10)
Issuance of treasury stock for share incentive plan (in shares) \| shares	15,002,660
Issuance of treasury stock for share incentive plan (in shares) \| shares		(15,002,660)
Vesting of restricted shares		¥ 5	(5)
Vesting of restricted shares (in shares) \| shares		6,232,100
Vesting of restricted share units		¥ 3	2,853					¥ 2,856
Vesting of restricted share units (in shares) \| shares		4,830,900						(1,812,960)	(1,812,960)
Exercise of share options		¥ 3						¥ 3
Exercise of share options (in shares) \| shares		4,924,720						(4,925,000)	(4,925,000)
Foreign currency translation adjustment					(7,848)			¥ (7,848)
Ending balance at Dec. 31, 2021	¥ 698	¥ (11)	2,630,456		(9,757)	(2,366,531)		254,855
Ending balance (in shares) at Dec. 31, 2021 \| shares	1,030,177,260
Ending balance (in shares) at Dec. 31, 2021 \| shares		(16,161,010)
Statement
Net income (loss)						86,517	¥ (13)	86,504
Share-based compensation			24,964					24,964
Issuance of treasury stock for share incentive plan	¥ 13	¥ (13)
Issuance of treasury stock for share incentive plan (in shares) \| shares	20,000,000
Issuance of treasury stock for share incentive plan (in shares) \| shares		(20,000,000)
Vesting of restricted shares		¥ 3	(3)
Vesting of restricted shares (in shares) \| shares		3,625,000
Vesting of restricted share units		¥ 6	2,016					¥ 2,022
Vesting of restricted share units (in shares) \| shares		9,286,460						(5,637,860)	(5,637,860)
Exercise of share options		¥ 5						¥ 5
Exercise of share options (in shares) \| shares		7,894,340						(7,894,000)	(7,894,000)
Foreign currency translation adjustment					24,314			¥ 24,314
Appropriation to statutory reserves				¥ 529		(529)
Ending balance at Dec. 31, 2022	¥ 711	¥ (10)	2,657,433	529	14,557	(2,280,543)	(13)	392,664
Ending balance (in shares) at Dec. 31, 2022 \| shares	1,050,177,260
Ending balance (in shares) at Dec. 31, 2022 \| shares		(15,355,210)
Statement
Net income (loss)						(126,651)	(7,864)	(134,515)
Repurchase of common shares		¥ (951)						(951)
Repurchase of common shares (Shares) \| shares		(9,165,200)
Capital injection in subsidiary by non-controlling interests shareholder			3,795				(1,496)	2,299
Share-based compensation			23,951					23,951
Issuance of treasury stock for share incentive plan	¥ 14	¥ (14)
Issuance of treasury stock for share incentive plan (in shares) \| shares	20,000,000
Issuance of treasury stock for share incentive plan (in shares) \| shares		(20,000,000)
Vesting of restricted share units		¥ 11	3,271					¥ 3,282
Vesting of restricted share units (in shares) \| shares		17,137,010						(7,989,200)	(7,989,200)
Exercise of share options		¥ 6						¥ 6
Exercise of share options (in shares) \| shares		7,506,980						(4,632,000)	(4,632,000)
Foreign currency translation adjustment					3,366		(89)	¥ 3,277	$ 462
Appropriation to statutory reserves				1,113		(1,113)
Ending balance at Dec. 31, 2023	¥ 725	¥ (958)	¥ 2,688,450	¥ 1,642	¥ 17,923	¥ (2,408,307)	¥ (9,462)	¥ 290,013	$ 40,846
Ending balance (in shares) at Dec. 31, 2023 \| shares	1,070,177,260
Ending balance (in shares) at Dec. 31, 2023 \| shares		(19,876,420)

Accounts Receivable, Net

12 Months Ended

Dec. 31, 2023

Accounts Receivable, Net

Accounts Receivable, Net

4.Accounts Receivable, Net

Accounts receivable, net is consisted of the following:


	December 31, 2022	December 31, 2023
	RMB	RMB
Accounts receivable, gross:	3,233	1,596
Less: allowance for expected credit loss of receivables	—	(39)
Accounts receivable, net	3,233	1,557

4.	Accounts Receivable, Net (Continued)

The following table sets out movements of the credit loss provision for the years ended December 31, 2021, 2022 and 2023:


	For the years ended December 31,
	2021	2022	2023
	RMB	RMB	RMB
Balance at beginning of the year	—	—	—
Current year provision	—	—	(39)
Balance at end of the year	—	—	(39)

Accrued Expenses and Other Current Liabilities

12 Months Ended

Dec. 31, 2023

Accrued Expenses and Other Current Liabilities.

Accrued Expenses and Other Current Liabilities

11.Accrued Expenses and Other Current Liabilities

The following is a summary of accrued expenses and other current liabilities as of December 31, 2022 and 2023:


	December 31, 2022	December 31, 2023
	RMB	RMB
Advertising and promotional expenses	33,048	25,196
Professional service fees	5,237	11,759
Payable for property, equipment and leasehold improvement, net	871	329
Payable for share repurchase program	—	949
Payable for remuneration fee of ADR program	—	3,517
Accrued sales rebates for advertising business	1,360	467
Provision for litigation contingencies	3,156	2,403
Others	3,950	3,890
Total	47,622	48,510

Prepayments and Other Current Assets

12 Months Ended

Dec. 31, 2023

Prepayments and Other Current Assets

Prepayments and Other Current Assets

5.Prepayments and Other Current Assets

The following is a summary of prepayments and other current assets:


	December 31,	December 31,
	2022	2023
	RMB	RMB
Receivables from a third-party financial institution⁽¹⁾	—	90,659
Prepayments to vendors	16,110	11,815
Deposits	5,286	5,624
Receivables from third-party online payment platform	2,612	1,884
Deductible VAT	2,399	4,922
Receivables from bank funds in transit	—	4,604
Staff advances	393	325
Others	3,591	4,831
Sub-total	30,391	124,664
Less: allowance for expected credit loss of receivables	—	(90,750)
Total	30,391	33,914

(1)	As of December 31, 2023, receivables from a third-party financial institution amounting to RMB90.7 million (US$12.8 million) are subject to a risk of default, as disclosed in Note 21. Consequently, full allowance for credit loss provision has been recorded.