Q4 2020 Weibo Corp Earnings Call
[music].
Ladies and gentlemen, thank you for standing by and welcome to Weibo reports fourth quarter and fiscal year 'twenty 'twenty financial results conference call at this time.
All participants are in a listen only mode. There will be of presentation, followed by a question and answer session at which time. If you wish to ask a question of you will need to press the star one on your telephone.
The advice you that this conference is being recorded I would now like to hand, the conference over to your first the speaker Sandra Zhang Weibo IR. Thank you. Please go ahead.
Thank you operator, welcome to Weibo's fourth quarter and physical year 2020 earnings Conference call. Joining me today are chief Executive Officer of Golfie, Wang and our Chief Financial Officer of feeds all the conference calls the auto being broadcast of the Internet and is available to leave with Iowa.
Before the mentioning remarks I'd like to read you the safe Harbor statement in connection with today's call. During today's conference call. We may make forward looking statements statements that are not historical facts.
The statements of our beliefs and expectations for looking statements involve inherent risks and uncertainties a member of the important factors could cause actual results to differ materially from those contained in any forward looking statement.
<unk> assumes no obligation to update the for looking statements in this conference call and elsewhere.
For information regarding these and other risks is included in Weibo's annual report on form 20-F, and other filings with the SEC.
Oh the information provided in this press release is occurring as of the day to heal.
We will assume no obligation to update such information, except as required under applicable law.
Additionally, I'd like to remind you of that our discussion today includes certain non-GAAP measures, which is to stop the stock based compensation I'm sitting although I expenses, we use non-GAAP financial measures to getting a better understanding of weibo's comparative operating performance and future prospects all of them.
Non-GAAP financials is cute certain expenses gains and losses and the other items that the knife stuck day, two without in future cash payments for us all.
Of the cooling in nature and not indicative of our core operating lease out in all of please refer to our press release for more information about our non-GAAP measures.
No. He mentioned prepared remarks, we will open the lines for Q&A session.
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Let me start with our fourth quarter financial results in the fourth quarter of our total revenue increased 10 per cent to $513 4 million, mainly attributable to less impact from COVID-19 pandemic true to the other pricing business as well, it's all efforts to optimize the competitive strategy for brand and performance Ad business.
I know of of Tyson and marketing revenue reached 400 of $53 5 million, an increase of 12% year over year with Nike one per cent of our revenue coming from mobile in the fourth quarter non-GAAP net operating income reached the 200 and for point of $1 million, an increase of 12, the 21 per cent here.
For here, representing a non-GAAP operating margin of 40 per cent.
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For full year 2020, Weibo's total revenue reached 1.69 billion of decrease of four per cent year over year advertising and marketing revenue was for 1.49 billion of decrease of three per cent year over year non-GAAP operating income reached $579 6 million representing a non-GAAP.
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As we review of 2020, we faced two major challenges for some of the use of from although the pandemic in the first half of the year, but what has large scale use of per consume pandemic related needs in her chance. It had the negative impact on the content generation of entertainment vertical and certain other areas such as tourism and sport.
Which resulted in less use of engagement in the sector with progress made on the pandemic control. We've adjusted our strategy Accordingly in the second half of the year, putting more emphasis on our core competence in Hudson social functions on the video so far we have seen an uptick of our overall traffic in the first quarter compared to.
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Second on monetization of the pandemic has hit some sector of our business hard early last year, however, with the well controlled centrally and that's the situation and the recovery of the at the net weibo, social marketing value proposition or the wider recognition among brand customers leveraging our unique marketing offerings such.
Hudson celebrity and the QL marketing as well as brand plus the performance solution as reads out of brand AD revenue deliver a solidly from in the second half of the here and achieved double digit growth year over year in Q4 with number of pending customer spending with the setting a new record for the.
Performance. Additionally, despite the spikes of it and pressure from other types of and the.
The market competition, the decrease of all performance AD revenue in Q4 for the neighborhood with the compare with prior quarters, mainly thanks to the fully upgraded at feeding system Super F. S. T and the continued robust growth in gaming and education sectors and the the brand plus performance models.
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Well the suit next let me share some color all the profile schwinn product of monetization in Q4 as well as laid out of key initiatives for 2021.
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On the product from starting from Q4 of last year, we further enhanced the weibo's differentiated competitiveness in Hodgkin and social attributes coupled with efficient channel with the strategies, we stabilized our use of scale and further drove user engagement concurrently we also beef up our investment in the video sector to strengthen.
As of the mindset of using Weibo for video consumption, so as to enhance our competitiveness and use of acquisition that should all three of them in so cheap.
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On the channel from in Q4, we optimize our channel strategy for new area called news the combined with Hudson on topic of products when a hot events occur we will encourage the media accounts and kols to discuss around topics through product and operating mechanism, providing real time topic related content to users.
With the opening of optimized strategies for further enhance the platforms competence is this the recall and the vacation the Hudson, bringing our strength in content offering into for play taking the new year's Eve and for example, the number of new used it really hurts the per.
Pat 100 of 20 million up 77 per cent compared with last year, and we hold more than 16 nearly of use us back to our platform.
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On the social front for this use of free close to hobby bands for channel investment, we focus on improving their consumption of debt and use of frequency in the relationship based of feet to elaborate we focus on improving the user experience and relationship based the fee. So data mining on quality social content based on Saturday.
Cash at such as intimacy of social relations frequency of visits and amount of discussion by followers et cetera, with such quality content offer we could further deepen their consumption as well as enhanced use of user retention.
Additionally, we focus on enhancing the diversity of the content distribution in the information feed in order to drive use of sickness interaction and the consumption for instance in the fourth quarter, we extended real time consumption of video content suite.
The simultaneous distribution you know of coffees as the lease out the.
That's the time spent per user on the post media recommendation feed the increased over 30% and the effect of media reviews post post the each recommendation increased over 10 per cent compared with Q3.
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On the video front in 2020, we reinforce our product offerings and accretion mechanism and attracted a great number of quality video content creators to label in the second half of 2020, we launched the video accounts program to incentivize the Weibo's top content creators to ship towards video content generation.
So as to encourage more video production and consumption. We saw a significant uplift in the number of free to accounts currently the number of registered for video accounts has the past million among which over the 15000 video accounts already have more than 1 million followers for each by vertical.
Theres a good proportion of video produced by top content creators in the media and variety show verticals, but you still need to increase that to many other sections of the platform. This year, we will continue to improve the overall experience for video accounts scale off of video content generation of Mt top content creators as.
While expense of the effective distribution of video content in feed and the video community. So as to boost the video content consumption and improve the problems over the video content ecosystem.
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Let me briefly Oh Saturdays for 2021 on the part of the operation front, we seek to expand the user base and the engagement from the following three aspects first of all the channel investment leveraging our comparative advantage in user acquisition costs will issue of channel investments through traditional channels and focus.
More on schnell of investing to improve user engagement well strengthening of the synergy between channel investment and subsequent content consumption, and thereby increasing user engagement and retention of that.
On core competence.
We will continue the solidify weibo's competitive mode as the leading social media platform from product perspective will improve core features of how churn in the social interactions and improve user thickness and interactions among users core use of groups on the accounting because system side, we have a step up of all efforts to empower talk.
Content creators to monetize smoothing out ecosystem, which will interest stimulate their content generation and interaction with the fast driving weibo user engagement. Finally on video content through video accounts will accelerate accelerate the transformation of videos key Weibo's key content creator group too.
Award of video creation.
The promote the supply and consumption of LIBOR video contents and Meanwhile, we are focused on cash hunting. The corporation on key vertical such as T. V series for a variety show and gaming verticals to cultivate users' consumption behavior to all of differentiated video content offerings and the further extensive use of loyalty.
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On the monetization front, okay and rapid growth.
Q4 increased 18% year over year, the rapid recovery of K K business in the second half of the year were mainly driven by the following factors first of all from the perspective of the marketing environment. Most industry sector have returned to normal accretion in the second half of the year and if magically revealed at the place.
Except for the sectors, such as entertainment and tourism that has not fully recovered from the pandemic and Meanwhile, the pandemic has further driven AD budget shift from offline to online with the top brand customer and also the Oh some of those emerging breast embracing internet platform as the nature of our campaign.
Secondly, K clients have shift to more of the budget from television and long form of long form video platform to social and short video platforms for knowing the use of engagements chip with this trend social platform had more strength in K a kicked in marketing.
Finally in K eight out of advertising, we will highlight these marketing strength based on cable L content IP and the brand plus performance offerings leveraging is robust the content ecosystem for one thing we facilitate the federal content marketing for tops for a client for another we lower AD placement of barriers for brand.
Customer, especially mid tier customers through brand practical for months at offerings, and thus deliver better AD efficiency for it.
Example, you throughout 2020, we had nearly a thousand of cotton marketing protests leveraging of hundreds of celebrities.
So of Kols and more than 13, thousands of K O C to participate in brand content based of campaigns, achieving way better results than pure of blending campaigns.
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So I always thought you from even the Qingdao moving onto the S of knees in 2020, we continue to see intense competition in the performance end market, that's set of SME and rapidly the stick with 5% year over year. The in the fourth quarter improving from last quarter in terms of any trend. Let me briefly recap our progress made in the.
The outperformance that sector in the in the year of 2020.
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On the AD product front first we focus on enhancing the overall efficiency of our real time bidding system, namely Super F. S T and the further optimizing its algorithm.
We launched up of advertising tooth such as the two Bolton and AD solution, which enables marketing content content posted by celebrities and kols to reach of more accurately target group of instantly leveraging the influence of celebrities and Kols, we can maximize the campaign in fact, well reducing customer.
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On the sales operation accretion from first the optimize the SME sales model for key industry to directly serve more clients. So that we could respond respond to and fulfill clients' needs more efficiently. Secondly, we felt the lead agency to improve their service capabilities and transform.
Into a service provider third we offer industry specific solutions to improve AD performance for different industries, leveraging the operational capability around topics and events, we simply can't E&P implementation of the above mentioned strategies, we saw robust growth in gaming.
And education sectors of this year maintaining of triple digit growth year for you in the fourth quarter in the second half of the year, we gradually expand day such industry specific solutions to the Internet service and some of flying O to O in the streets to capture to catch the higher wallet from key industries.
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In 2021 we will continue to enhance our monetization scale and the efficiency from the for loading aspect for us.
The product based on Weibo unique attributes as the social media platform with younger users. We will continue to strengthen the competitiveness of the social AD products and further capture the brand plus performance budget and the QR marketing dollars to reach more of an emerging claims as well as obtaining incremental budget.
From mid tier and top clients.
Hopefully both claims number and a part could serve as drivers for growth.
Second on sales I. Appreciate we will further develop all of industry specific solutions and support our industry base. The sales team to improve operation of organizational efficiency from the aspect of sales policy operation of the energy part of optimization and service capability et cetera as such.
We could improve our wallet share of assume more diversified drivers from the industry perspective for.
Finally, I'll add technology building on the upgrade of Super F. S. T. We will continue to optimize the AD targeting and the conversion rate of Oh C. P. Ex so as to increase the placement of efficiency in our eye for coins.
Coupled with the free funnel AD optimization, we bought is well positioned to improve our E. C. P. M in 2021 and Meanwhile, the fish.
And our video AD technology, and the monetization efficiency to gradually unleash the potential of video traffic monetization Tucson.
To sum up in 2021 with more money money type of traffic generated from the growth in user base and engagement, we will step up of all efforts in AD products sales.
<unk> and AD technology to increase Weibo's monetization scale efficiency and the market competitiveness.
I don't want somebody to talk to each of US would you do other union Trinian those how would you well with that let me turn the call over to Paypal for a financial review for the fourth quarter and the 'twenty physical year 2020.
Thank you for golf and how the other that well.
Well have to wait for the first quarter of on the 15th.
Earnings Conference call.
Let's start with your the metrics.
We would I mean.
The first part of the 'twenty one meeting.
Okay.
The addition of fast mainly user all of your every year basis.
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200 attendees at the meeting.
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The decision of familiar with or on a year over year basis.
Oh, well I mean, you represented approximately 94% of total in the U.
Other than the vendor my prepared remarks.
Focus on non-GAAP results and the other comparison on the year over year basis, unless otherwise and all of them.
Now, let me walk you through our financial highlights for the fourth quarter and the fiscal year 'twenty.
Weibo fourth quarter of plenty of parking lot revenue with 513 pardon for me.
Anyway of kind of cross that.
Operating income was 200, the focal point of one meter.
The increase of 21.
With that that percentage.
The operating margin of 40 part of that.
Net income attributable to wait for you to the 200 of out of 12 on Southern Union.
A replay of the time people one per cent.
The net margin of 41%.
Diluted EPS was <unk> 92 of that compared to 77 stuff you plenty of 19.
But for all your type of funding total revenue, yes, the one 6 billion a decrease of 4%.
Operating income was at that time to the Saturday night on the six minutes a.
The credit upheld for Sun.
The operating margin of 34%.
Net income attributable to Weibo is the first part of the what is that of the plot.
Part of it representing a net margin of 32 per ton.
If I look at API, two part of 38 compared to the true part of 78, I mean part of the 19th.
I think they would be on the color of our fourth quarter on the for years have you thought of the valuable.
Advertising on the maximum revenue per truck for.
Part of our company.
Well for 100.
Five 5 million.
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Mobile AD revenue reached the 400 of searching on the 8 million per se.
The Nike what percentage of our total AD revenue up from 18, 8% last year.
All year of tiny tiny advertising and the marketing revenue due to the one one but he liabilities.
The increase of the perfect with mobile AD revenue contribution of 90% of total AD revenue up from 87 for that.
In the 19.
Besides and president had the challenges from COVID-19 unresolved hit the full year think of each of the revenue decrease.
Please go to the Saudi the recovery in the second half of the country.
And the pet, but all of the.
Out of the model of the pickup in the domestic market.
Of the new economy, bringing incremental masking the mountains.
All of them and that plays out for us for capturing you argued.
In addition, the AD wallet share of the existing fat.
Let's start with page eight in the fourth quarter, our K AD revenue like 200 of 26 on the eight media.
The increase of 18%.
The 6%, excluding the impact from part of our transaction.
Our Cape business booked accelerating of the year over year for off.
That's the number of brand advertisers funding line.
The reaching a new record.
In the true why the recovery of momentum for our retail business continued to be broad based.
But the key sector of that.
N D G and other mobile close of the year all of our higher load.
Obviously, the sad entertainment channel and the deal instead of sector. They met the criteria.
As of a variety of COVID-19 cases.
And part of postponed the recovery of pace of new sectors in late 2020.
For years, I mean, if I could.
The address the.
Set of kind of the 41 5 million I think credit of 2% of that Prasad, excluding the impact different than the.
The subject of God of Weibo total ad revenue.
Okay business demonstrated resilience against the tough market environment.
The two weibo's unique value proposition to breadth of customers.
Weibo has gradually become the cornerstone of man the advertisers' marketing fast.
The offer for Farnell marketing solutions for serve their branding plus performance.
In terms of your 'twenty, but also north of eight captured in the micro of AD wallet the.
Our differentiated in the tail.
Our marketing to the.
As unique products.
Such as search and a copy of the products.
Is resonating well with customers of the model.
Looking forward with.
Continuous recovery of AD demand and the opportunities brought forth by you.
We continued with the had the expanding our customer base as well as potentially the Tam.
Looking to the incremental AD worked.
We believe we're well presentation sort of solidify and a part.
The I believe our competitiveness.
In the breadth of advertising market.
Turning to act on the east in the fourth quarter Weibo's SME AD revenue for that hundreds of 60 752 million a decrease of that part of that.
We continued to narrow the year over year at the exact right.
<unk> the lack of momentum of all of the sectors, particularly the gaming education and the E Commerce.
That's that.
Second of all of the customer continues to face headwinds, but cannot really to me the periodic outbreaks of COVID-19.
19 cases, the logical area in China.
Full year outside of the AD revenue was outside of the Nikkei $2 7 million of peak rate of 16%.
The current then how approximately 40% of people in total AD revenue was.
Mainly due to significant the impact from COVID-19.
Especially for all of that sector of.
The competition.
Although the performance AD market in 2020 was challenging in many ways.
We've made the dry expanding obviously the ex power age.
Driving me to add penetration as.
That's for us the basket in the variety of the industry specific ad solutions.
Which all aimed to enhance our AD pro from it.
We're delighted because the least initiative.
The bad fluid in early stage.
The gaming and education sector of booking triple digit growth this year.
The early momentum for these true sectors demonstrating of the wave was potential E delivery.
Related to the competitive all in the bucket.
Leveraging our unique strength the A&P braking weibo's resource income.
So al assets and traffic.
Okay.
AD revenue from Alibaba for the Gardiner for.
For 59, 5 million, an increase of 15, 7%, reflecting our cocreation with Alibaba to drive value for both platforms breath and more test during the peak E Commerce.
Promotional season.
Full year AD revenue from Alibaba, well that Congress 52 of median.
The increase of 15, 5%.
Apart from the fact that side of the 19 was relatively low base the momentum of the Alibaba AD revenue also reflected our AD for us in serving integrity of the marketing demand for both the platform thread at the margin.
That's it.
As the from Alibaba is highly correlated to the two is all goodness operation, especially if marketing strategies, which may change from time to the card.
That's kind of indicated earlier, we cannot assure that the second of all possible will be sustainable in the future.
Value added the survey last revenues for.
The 59 9 million in the first part of her a decrease of four for Sun. The decrease was primarily resulted from the decrease of last for new business and was partially all of a sad by the revenue contribution from the interactive Entertainment. The company acquired on the consolidator of this at the company.
November of 'twenty 'twenty.
For a tiny tiny vas revenue were too high.
That's great part of 8 million a decrease of 14 per cent, mainly result here the from a decrease from the last streaming revenue.
Turning to costs and expenses.
Total cost the expenses for the fourth quarter was 300 of 913 million of inquiries. After the price that the increase was primarily due to higher personnel related costs and step up the marketing spend and what the.
Partially offset by decreased the general and administrative expense.
Full year costs and expenses totaled the one on the 11 million compared to one one times EBITDA.
The 19.
Operating income in the first quarter with 200 for part of my immediate I inquiries of talking about it for that.
Representing an operating margin of 40 per cent compared to 36 per cent of last year, reflecting our salary of the recovery post COVID-19.
COVID-19.
And our capability of the liver ambience and the margin profile I mean, the market competition.
Operating income for for years have anybody was passed kind of of the $79 6 million.
The operating margin of 34 per cent compared to 37% interest of 19.
Turning to income tax and the cat matter income tax benefit for the fourth partner was 25 plus range compared to making fun of the second one for 1 million last year.
On the type of banning of it was primarily due to the recommendation of the preferential tax treatment for certain of the Companys the PRC subsidiaries.
I thought of as reverse of the recognition of the Florida tax liabilities in profit here is related to uncertainty of investments.
Full year income tax expenses, what's the.
The one 3 million compared to 100 of nine 6 million in 2019.
The decrease was primarily result from changes in the part of tax liabilities related to fair amount of change sound investments.
Net income attributable to Weibo in the fourth quarter was 200 of 12 on the 7 million compared to a one time of the 76 5 million last year.
Net margin was 41 per cent compared to the 38 per cent of the same period last year.
Net income for the full year of public money was 547 5 million, representing a net margin of 32% compared to 36 per cent and quality of 19.
Turning to our balance sheet and the cash flow items account for you.
How much of the first plenty plenty.
Cash cash equivalents I'm sure for me last night.
Total $1 5 billion compared to the two o'clock for billion I felt at December 31 for the 19th.
The increase was primarily due to the net proceeds from 715 million senior notes.
You should eat July of 'twenty 'twenty for general corporate purpose of the cash provided from operating activity.
And was partially offset of investment activities, we've made at the already in 2020.
In the first quarter cash provided that the all play to have activities for $321 2 million capital expenditures totaled eight one for me.
Depreciation and amortization of expenses amounted to two tenths of $1 70.
Oh from ear basis of cash provided by operating activities.
700 of 41 6 million type of expenditure of hotels.
The 30th ballpark eight minutes, and the depreciation and amortization expenses of market starting to bundle.
A lot of meeting.
We delivered approximately 768 million of free cash flow into the Lucky I increase of 13% year over year with the docking archive of ability of delivering higher profitability on the generating strong operating cash flow loss.
Let's talk about our financial outlook.
The piece of page of our first quarter of plenty of people like the one of them.
So the inquiry.
About 25% to surface for that year over year constant currency basis. This.
This forecast.
Of the reflects Weibo's current and the preliminary view on the subject to change with that let me now it's hard to call over to the operator for the Q&A session.
Thank you ladies and gentlemen, we will now begin the question and answer session. If you wish to ask a question. Please press star one on your telephone keypad and wait for your name to be announced if you wish to cancel the request. Please press the pound or hashmi.
Your first question comes from the line of Tian who of Th capital. Please ask your question.
How are.
Got you back of house.
All of its own yourself.
The 10-Q.
I can T D.
Good day.
So the fact that.
The thing.
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Yeah.
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Some of that.
Yeah.
One has already.
Our 2021.
Uh huh.
Yeah.
All of them.
Look.
In the us or our growth and as well as the channel exactly thank you.
The.
Okay, that's a little bit of.
The the arguments.
Internationally the Rd Rd news.
Women that's the other one.
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Sure.
Okay.
The room that Union Siobhan answer here, but you've got quite a bit out of the union jobs here.
I also need to share that you go up.
The money, but it wont be out of Africa.
So of course your dock quote you the origin of the incentive.
Sure.
The other gain so you saw the Fuji two of them your comments on cash flow.
The one thing.
Of course, you for me the total.
All of which you don't get Wang will also from me. It's one of the outdoor that's coming out of control. So it won't kind of people you want to drill down the hall.
So relating today's question before answering the question about 2021 lets talk about the issues that we had in 2020. So for example of due to the COVID-19, you know that we really had a historical high or reaching the peak of those number of users in Q1, but actually you know normally in the past after consuming some of them.
Products like the whole topic of caught up or hard to try and products. Those are consumers of all of those users are going to be with us and retain with us to further consume the entertainment and also the other vertical related products, but actually because of the COVID-19 in the second half from 2020, we had a very good the management and also the restrictions on.
Of the entertainment related product consumption. So the retention rate of those kind of customers or users dropped. So those are the major reasons of causing us to have a decrease the number of users in Q2 and Q3 of matrix. So in Q4, we had been doing some kind of of what for example, increasing the investment to the user acquisition cost.
And also we've really increased some kind of the prototypes nation in order to attract them also retain those kind of of users.
So you shouldnt that much of a woman so even with the agreement.
Oh go ahead of mailed them, yeah, the xiaomi mi from telco into income.
For the survey.
So you wont quota for them.
We're kind of studios the actual negative quarter Bill.
Don't tell anybody from injury.
So for me.
They tend to have April and mentioned on the Russia Council the shelf in the Green.
So the if I may which is from the gene to me anyway, which is one of them and they're trying it for the courtroom.
And also.
You can see that we have been doing some kind of a of things right now because you know rather than paying attention to and that you know.
Now, we pay more attention to the total consumption as well as the the frequency of the consumption of specific so are we kind of interpret that into the following kind of the parameters. For example, the of you and also some kind of the frequency of the consumption and also the total scale of the consumption. So that is actually you know going to really help us to <unk>.
Proof of our competitiveness as well as a kind of inventory of the monetization.
Hum.
First of all tied to the golf are kind of all of them.
We're able to retire debt.
And then maybe from an ease of use of HIFU being out in the ocean of well meant the aren't unions for the ones you can knock on doors for tapering of who I know a bunch of home infusion for the new.
It sounds like you don't have the shelf options for for me I'm sort of Twilio range. So that's it.
All of them kind of vessels all of the 10 year easy to Shanghai, Guangdong them for you to outgrow the Ashford yet neither way for the whole you from here unless you got the agenda and got them in the bunch of children coming of the question of the Shelby Pizza.
Kind of on the commercial being so low and peanuts.
Heading into the digital volume for some gas from the property.
What actually you don't make the shop at the shop at our conversion of each of the Navy.
It's usually come with everybody man, who was shipped in the auto and having been the only so I don't want to say for me of that kind of pharma to your children with non Florida.
One of them the way more easy to use without the bush.
Okay.
Sure.
And the.
And also you know in terms of our strategy in the future in 2021, we true it really would like to focus on the following items. So first of all we had our traditional advantage in terms of acquiring those of users through our hot trends. So in the past in 'twenty or 'twenty actually we had some of the issues.
In terms of the increase in the retention of ratio and also helping the users to actually stay with us more and consider more frequently so actually in 2020. One in Q1 and also later this year, we're going to further emphasize on these two particular points. So that it's a day for the first of all emphasizing on the of consumption related to the relationship based feed.
And also we're going to encourage those video of accounts to actually publish more videos and also help and trigger the consumption of around the videos by the use of so actually in two of these kind of a way, especially through videos, where a bunch of really help to increase the retention ratio of our users. So actually you know we are very.
Confident the overcome the difficulty and also get ourselves improved in the later this year.
For tomorrow in the entering of Tricia talking about each of the nature of the Ohio Digital T. Rubaiyat Golf says low code junior our union of cure the tone.
Of the Itachi, Josh I don't know Columbia from Ohio for Chevron in the Gulf of Oxford don't dominate the true.
The second chance yoga of Charlotte should help with the automation of the share of children reordering for shelf.
Okay.
Got it.
The board.
So you got going out of Chang colony, we don't want from that which you said I won't go into but also do from here and I hope the output.
One of the two come home gym.
And also lastly, I want to say that in terms of the 'twenty to 'twenty. One time, so first of all of them talking about the year on year comparison, because we had a very high historical figure in Q1 of 2020, so it's not that meaningful for us the compare but actually we're very confident of realized a month to month growth in 2012.
The one tier one and also the other thing is that in terms of our channel strategy to really focus on increasing the retention ratio of our users and also really helped to build a very good and also of healthy growth on the number of users. So we're very much confident in of driving the traffic.
Also driving the activity and also the retention ratio of the users in 2021.
Patricia.
That's very helpful. Thank you.
That's all my questions.
Your next question comes from the line of Memoranda of Geelong of Bank of America. Please ask your question.
Thank you Y O Y and some guy sort of just show that even in the whole corn featured for the Gulf of downtown seem to the take or you could see the V go down along the Homewood of into you shook of Pete I'll go Monkeyshine Salomon three take all the all Union. The challenge for you grew up on called the whole found out of your core Chartwell got whole T don't do share a couple of its eye towards the et cetera.
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The higher they don't take all the time of day.
So now you're funding it goes south of tissue nullifying each other thank you for taking my question. So my question is can you. Please share the I spend outlook for the 2021 and so what kind of your products and services, well, particularly of gain traction and gain the incremental back out of occasions.
Among your can I send me the kinds of across different industry sectors. Thank you.
The two closer to kind of out of kind of on the Cajun revenue.
So I'm actually with some of the top drives.
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Are any of them in Shanghai actually of Ddos.
The two zone.
It is.
Operating loss.
And so let me out of this particular question. So first of all in 2020 of Q4, we have been seen of very good recovery of our of pay a customer, especially we returned to the the triple digit growth and also we although had a year on year decrease on SME.
In the Q4, but still that's particular decrease right has been the reduced and also further in 2021, what kind of.
Really you know see a kind of a very good growth on the brand customers, especially the S. M. C. G and also automotives as well as the luxury as well and also in 2021, we're going to see also of very good growth for entertainment as well.
Also the next part of it's about the SME. So the Seattle for example of where I've seen of very good trend for gaming or Internet service is what is the online education et cetera, et cetera, but actually are we're not quite sure whether on the other than to see another doubling of attacks. So of doubling results of the gaming industry. This year and also talking about the other traffic.
Diverting a related the Smbs you know without a very strong demand on branding I'm actually in 2020, we were talking about those oh duo or E. Commerce businesses, we had the little bit north of that.
The deal performance in 2020, but still in 2021 way of going to see I saw the intense competition in the area that I mentioned.
The two time line kind.
The final Gaucher T enable them with you on the sales, which I'm happy to hear about what exactly you know you're starting to talk on a woman she of naval Guy Peter Chu.
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Thiago Shishido the P chocolate or they don't tell me, if I'm not going for the sandwich and the Tohoku, you're saying kind of in the <unk>.
Sure.
As usual, we're kind of locked onto the old TV household items in terms of the tool.
The simple for in terms of the PMI coincidental OTV, the PMI of <unk> come.
I'm in the mail room, the IP of kilowatt Archer Daniels who'll talk all of the available in the chance that maintaining.
Each any of the bulk water E share total day, yet Peter.
To touch on each of asking that in the.
The Ocean <unk> will take for granted.
You can kill out the name of from an income of Youll share type of thing.
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Junior our Union Goodbye digitally and each of them for the time each of the functional grade products.
Sean for you don't want for Parkways share CFO until something kind of interest actually you don't see here.
It could be of quickly interact with one of the things you.
Are any of them so much about the wound.
Okay.
The other shopping.
Okay.
And also ex part is about the product so based on the social nature of the Weibo. So we are going to really focus continuously on the kind of a strategy of the brand plus the performance and also the content and also IP based the marketing strategies. So based on this particular content and IP based market.
That's what is the strategy of brand plus performance.
We have a very good of boundaries and gaining the budget from the top notch customers and also we do see that some of the kind of a short video is actually a very big competitor to the OTV area. So we can see that in this particular thing we do see that those customers from all the TV actually had a very high requirements over the kind of of.
Content and also the IP as well as the famous the Kols in this area. So based on the unique advantage of Weibo in terms of the IP and the Kols and celebrities we are very much positive to actually have the advantage of those oh, TV kind of converted or transferred the budget and gaining that.
And also next part is that we had the also a very good development in terms of banks nation of flow like the Super <unk>.
S. S. T has been upgraded for that so we're gonna see a kind of a low triple digit growth on the OS EPS ex well as well and also the gaming as well as the education as two verticals are increasing dramatically and also because of the upgraded the algorithm.
For the area and also talking about those particular customers they do.
Have the requirement that all need to gain traffic, but also they like to do some kind of the brand promotion work. So because of that we have seen that in 2021 were very much positive to actually have that particular of development, especially you're talking about the customer and E Commerce and also of Internet service.
Since the exceptions.
Yeah.
Okay.
And she said she said one of them. Thank you.
We'll take the final question from Alex <unk> of Citigroup. Please ask your question Alex.
Yeah.
Oh hi.
Good evening. Thank you for taking my questions also congratulations on the results and the guidance all of my questions is related to the AD inventory and also the competitive landscape.
So how does management elaborate the situation for you are seeing in 2021 are worse of loss share and comes off the at pricing pressure and the.
The other the supply of 14th of AD inventory as compared to last year, and even as compared to 2019 and also any comments on the margin trend for 2021, let me translate very quickly one of them.
For a lot of Trump I'll go ahead of the challenging there yet.
Well you know the whole quite of the ones that you ship a sound one changes you're thinking of itself without the channel of months, you should Oh don't know each other.
Yeah, Kolache, you'll see you should talk of Joe.
Joe go inventories a class of it because I'm sure.
One of the system of cotton.
The Dodge in terms of cheap you can share.
The quarter shipping each of them.
Now hold you shouldn't the took a little of indeed.
Once you add the yourself on cash.
Mhm.
Ooh with Central Bank for some of US for sure the comes out of a tissue.
Volume for some Thunder zone.
For Ontario $2 per share.
Early in the data opinion from some good the crew come into your time in terms of I got one more of them to show them. The right now congratulate the meal economic times non consequence of the deal.
For the shelf of the pizza.
Yeah, no it's not.
That's for <unk>.
The two women that much in the us to each other that kind of volume.
The woman the Guangdong.
Some of it I don't know.
Of the opportunity of that turns up the fifth.
The momentum.
Of course.
From a merchant.
Each of those of Shimon I kind of line of NAV can you go in and you're teaching young while for some of its on the outdoor zone.
Uh huh.
<unk>.
And some of them you can manage all of that kind of.
Woman from here to the dealers and the other options in the Chi from film adoption.
Sure.
Excluding the one machine of the vaccine.
What are your own portfolio of Katanga.
Hum.
So first of all talking about the AD inventory, so before and the first question and also to the first question I already mentioned that actually this year in terms of our strategies for the uses of.
We're going to actually see that more of our investment and also the product related studies are going to focus more on the EBITDA you and also the consumption frequency of the users and the per cabinet of consumption traffic of the users from the previous a laser focus on them.
So that is to say this particular day, you increase and also more frequency of the consumption of users will definitely drive the development of growth all of the AD inventory. However, the current speaking the based on the Q1 result, its very difficult for me to give you a kind of a forecast about this particular of AD inventory.
'twenty, one, especially for Q1 and of course, we do have seen the very good growth on the other video platforms, but still we are very much focused on increasing the day you and also the frequency up with the assumption of users and the strategy as well that's the day brain a growth of the AD inventory.
Yeah.
Okay.
Terms of your margin question of I think we'll try to take this question.
With the revenue growth of our primarily goal and at the same ton a day.
To enhance our competitiveness of our platform.
So they may increase our investment in marketing channels compared to last year tens of Utah.
So all of these basis, we expect our operating margin cause deleverage our debt and the high level that is Tuesday may be no less than 30%, but there still will be out there kind of the glass than maybe they impact the decline of oil.
With being a single digit maybe 5% compared to the lateral all of last year.
So in summary, the lives here at the top of list all of our strategy is many folks out in the improving our revenue growth.
The continued to improve the competitiveness of the platform at the <unk>.
Use the product level, so at cost and the.
Expenses level, the mayor of areas of investment.
We will be in place.
<unk> the marketing channel investment the Lucky of 'twenty 'twenty due to the other damage and the other impact market channel investment was caused seven per the that is down from the year.
We have plenty of light here, so kind of sit around the competitive user market and the leveraging weibo's relative advantage in user acquisition costs, where the.
To ensure our courage.
All spacing of channels such as Craig.
Asia and the book value of increasing the investment in user engagement.
And then the other area is the personnel related costs.
To maintain the order to maintain our competitiveness in the market in some key the.
The parkman such as our advertising business has happened and our R&D Department, that's our kind of personnel increased high kind of inquiries and the also the salary raise the last year due to the impact of the fact that makes the company also enjoy the sun.
Government funding for it.
This will impact our margin lift here.
So in summary, the effect of our margin that'll be drop from year to year.
Mhm Okay.
Hello.
Yes. Thank you. Thank you.
Yeah.
Uh huh.
Okay.
This concludes our conference call today. Thank you for joining US we'll see you next quarter.
Bye bye.
Thank you, ladies and gentlemen that does conclude our conference for today. Thank you for participating you may now all disconnect.
[music].