Q4 2022 Weibo Corp Earnings Call
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Good day, and thank you for standing by welcome to Weibo's fourth quarter fiscal year 2022 financial results Conference call.
This time.
But in a listen only mode.
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I'd like to hand, the conference Center, a strong strong way for IR team.
Go ahead ma'am.
Thank you operator, welcome to Weibo's fourth quarter and fiscal year 2022 earnings conference call. Joining me today are Chief Executive Officer, Cathy long Chief Financial Officer T cells.
It's also being broadcast on the Internet and it's available to leap with IR website.
Before as I mentioned in remarks, I'd like to read the Safe Harbor statement in connection with today's conference call. During today's conference call. We may make forward looking statements statements that are not historical facts.
These statements of our beliefs that patient.
Forward looking statements involve inherent risks and uncertainties.
Number of important factors could cause actual results to differ materially from those contained in any forward looking statement.
It seems no obligation to update the forward looking statement in this conference call and elsewhere.
Further information regarding these and other risks.
Included in <unk> annual report on form 20-F, and other filings with the SEC.
All information provided in this press release is occurring as the date hereof Weibo assumes no obligation to update such information, except as it was quiet and applicable law.
Additionally, I would like to remind you that our discussion today includes certain non-GAAP measures, which exclude stock based compensation and certain other expenses, we use non-GAAP financial measures to gain a better understanding of freeport's comparative operating performance and the future prospects, our non-GAAP financials exclude.
Expenses gains or losses, and other items that are not expected to result in future cash payment or non recurring in nature or are not indicative of our core operating results and outlook. Please refer to our press release for more information about our non-GAAP measures.
You mentioned in prepared remarks, we will open the lines for a brief Q&A session with that I would like to turn the call over to our CEO coffee well.
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Robbie.
Thank you Hello, everyone and welcome to Weibo's fourth quarter and full year 2022 earnings conference call.
Quick question on that I was wondering can you help me better terms to your question.
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Got it.
On today's call I will share with you highlights in Weibo's user product and monetization review the progress made in 2022.
Luckily our strategies for 2023.
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Let me turn now that notion tunnel 10 year over year.
Let me start with our fourth quarter financial results in the first quarter. Our total revenue reached 448 million a decrease of 27% year to year or a decrease of 1% quarter over quarter as marketing activities on Weibo was largely impacted by the Kobe sector as well as other other major.
A fair mainly term our total revenue decreased 20% year over year and remained flattish quarter over quarter advertising and marketing revenue reached 340 <unk>.
With 94% and wholesale revenues coming from mobile leveraging solid execution of our cost optimization initiatives.
non-GAAP operating income reached $152 million.
In our non-GAAP operating margin of 34%.
Meanwhile, non-GAAP net income attributable to Weibo reached $178 5 million up 50% quarter over quarter, representing a non-GAAP net margin of 40%.
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So full year 2020 to Weibo's total revenue reached $1 84 billion, a decrease of 19% year over year or a decrease of 15% year over year in demand return out of it.
Tyson and marketing revenue were one 6 billion a decrease of 19% year over year.
A decrease of 16% in renminbi terms are.
non-GAAP operating income reached six 600, and a $1 1 million, representing a non-GAAP operating margin of 53% mainly attributable to our strategic focus on improving operating efficiency since Q2 last year.
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On the user front in December 2022 way voice and they use reached 586 million of net addition of approximately 30 million users.
Basic everyday use reached 252 million a net addition of approximately 3 million users year over year basis in December 95% hopefully towards the end of use came from mobile.
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Looking back to 2020 due to the negative impact from macro environment and the Kobe factor. The overall market continues to face challenges and the AD demand show limiting Republic check to navigate through the challenges from a demand side.
Here too the strategy to optimizing costs and expenses and improving operating efficiencies throughout the year adopted more a more disciplined all I requirement for cost cutting expenses and improve efficiency in product operation as a result user engagement with broadly improve.
Overall traffic maintained steady growth from the previous year. In 2022, we also made great efforts in cost control and content distribution for major political theory.
For play to Weibo's advantages of resource integration and cost of distribution for the Kobe related publicity and assistance, representing Weibo's unique social lab.
Our monetization despite of the challenging margin environment in 2022, and the volatile market with descending trend, we successfully enhanced adoption of our strengthened brand plus performance at Wisconsin marketing solution. Among other titles from automobile handset manufacturer and online gaming industry that allows.
Celebrities media and kols to generate topics cause it and combining our wholesale product to create industry with clients and <unk> audience in the vertical areas.
Sweepers core competitiveness at least resistance capability in Brent and market has further strengthened.
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Let me share with you our progress made in part of the monetization in Q4 and they are our key initiatives for 2023.
Our finance, what you do need more.
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And then I'll answer your question.
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In the fourth quarter.
<unk> side, we focus on cotton monitoring and discussion for major public affairs as well as Covid related publicity after reopening and Meanwhile, display to optimize the distribution mechanism for the relationship based feed and interest based feed to improve users' consumption efficiency.
Initiatives contribute to traffic growth information feed in Q4 on a year over year basis.
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On the channel front in Q4, our Hudson product, that's fully cover the core position on the devices or bleeding domestic handset manufacturers, which increase the content consumption from a domestic handset in December the number of our culture and usage from domestic handset increased 40% from September which are further ahead.
Hence the influence of LIBOR Hudson products, among handset manufacturer and strengthen that use of consumption of our culture.
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On social attributes in Q4, we continued to optimize the distribution mechanism and product structure of our relationship with our feet, which further increase the exposure of high quality social content to use it.
Are you still on track for the relationship based defeat pick up rapidly in December reached the peak level in 2022, lastly, actually provoke.
Anthony This is bill.
Function of our product.
Also clarify the position of relationship based defeat and reinforced concrete distributions is the social behaviors of youth social networks in a relationship. They proceed we hope that relationship based feed can help you with a few high quality and real social connection for a more enriched anti both social network and encourage high.
Quality contemplate or to recognize the value of offence and generally more interaction with other bdcs and since we're more exposure in the relationship based feed during the beta test for the algorithm upgrade the impression for use at an increased funnel if he'd be a producer had picked up this year.
All of these initiatives to improve exposure of high quality content and enhanced accumulation for valuable contemplated for a more in reach social network. So as to further enhance weibo's core competitiveness in the social sector, especially in Colombia, our NIM with 20 entitled units should be Harvey.
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On the BD front, we focus on operation of high quality video accounts to this end, we introduced encourage video content creators to produce <unk> and topic face of video content to accumulate more fit and also to produce content in the pack from photo daily lives for milk interaction, we spent which could further enhance engage.
Video content creators on the elite on LIBOR in December both the number of video accounts that generally BDO and the effective EW grew double digit year over year and Moreover, the optimization obito product product continue to improve the rescue mutation.
And video play in spirits in the video feed and promoting social interaction on a plate playback page I speak out, but you've got the use of the BD feet in December 2022 increased over 50% year over year.
Number of users interact with home video playing page increased over 20% year over year, which improved user engagement and increased video AD inventory laying a solid foundation for the video AD revenue growth in 2023.
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On the content front in 2022.
Expenses for Teekay Corporation with partners Media Entertainment online gaming and sports vertical and secure the production of IP related content and hot topics.
With effective execution of our operational strategy the traffic a number of engaged user in key verticals increased by varying degrees from 2021 on the media front. We reached a full completion was immediate and easy with national equally in content and the monetization side to elaborate we incur.
Coach media account to lead discussion around here to discuss the social topics on LIBOR.
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Topic, two those in vertical areas to ensure the popularity of our Chinese vertical areas.
We motivate immediate to actively participate in the marketing campaigns on Weibo, we stay exactly media endorsement and distribution value both advertisers brand influence and commercial value of the media what promoted and also build self reinforcing ecosystem of content distribution on.
Monetization for media accounts on Weibo.
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By many accounts the scale up in 2022 up 20% from 2021 in terms of in terms of entertainment vertical we work with agents to promote content generation and engagement of Tulsa lab.
And also work with video platforms and producers to Jansen deposit generation and discussion around the popular movies and TV series.
As a result.
And the number of engaged produce entertainment vertical we do.
It's healthy growth trend.
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In response to the overall sluggish end market in 2022, we optimize the monetization model for papers top content creators and that's the number of content.
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In 2023, we will continue to strengthen the monetization for top kols to improve weibo's marketing capability to surf brand and increased top kols monetization steel and improve their engagement on LIBOR.
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2023 we will continue to focus on growing our business deal improving operational efficiency to drive up traffic and strengthening our core competitiveness LIBOR.
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First on user growth in 2020 free user engagement around Houghton and entertainment vertical that'd be helpful.
Copper as market and industry trend gradually improves for the movie vertical soon by the blockbuster effects for movies scheduled for the Spring Festival and television series early this year the number of users who had engagement with up 86% year over year and total engagement volumes grew 136.
Sand Hills and written through 2023, we work actively with our partners to movies P series and variety shows in order to promote a healthy development of the ecosystem around entertainment works.
It upfront we will also step up investment in Hodgkin's and thus ratings worth uses mindset of heart healthy consumption as well as point of user groups and engagement and Meanwhile, we plan to resume investment and accretion on certain channels and the market marketing campaigns based on the recovery trend of the market and in.
The street this year, so as to further drive user growth. She said it's come.
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Secondly on chassis group in 2023, we will further focus on strengthening our core competitiveness in Hodgkin's and social attributes and efficiently grow our traffic and monetization value.
On the operational front, we will beef up our efforts to reinforce our content ecosystem in key verticals as well as deepen engagement social attack.
As for use of product, we are dedicating to further optimizing product structure and distribution efficiency to continue to improve the user consumption.
In particular will broaden the social network coverage for the relationship based feed and nurture the interaction, but we think a community product. These initiatives are crucial to solidify our competitive moat in a social product landscape.
Further facility Weibo's sustainable and healthy development in future.
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In the first quarter Weibo's AD revenue decreased 29% year over year or 23% year over year on a constant currency basis, and flattish quarter over quarter on a constant currency basis as macro headwinds I was hoping to swaption weighed on the overall out of patented side, despite the challenging market marketing.
We are pleased to see certain key industries sustained upward trend year over year in this quarter.
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In the first quarter the World Cup with some major containing eventual many clients, especially in the food and beverage industry census to enhance operational efficiency. This year the traffic on interruption volume of World Cup to pass that off that they deem Winter Olympics.
We achieved sizable growth in our U S customer message the hutch on access speeds high teen market.
We are pleased to see total AD revenue generally in that World Cup season exceed that of the 18 Winter Olympics, especially notable at close of the food and beverage industry, our year over year basis.
Revenues from automobile industry also booked at year over year growth benefiting from better recognition of the new car launch among the industry clients.
Meanwhile, we successfully introduced a new product launch model two tenths of a sector, which delivered double digit year over year growth in Q4, despite the weak market environment.
Throughout the year for.
For instance, we showcased our content marketing solution with the launch of vivo.
Nike.
Some fleets of prelaunch product released and two impacts interpretation.
Nice to be in the digital product industry vertical kols capable of breaking the limitation of social as well as media to generate and also a client specific topics.
This is a hot topic is that after World Cup, we deliver brand recognition beyond the client's expectations pop these related to the new vivo ex 1950, $2 5 billion.
Once again, we showcased weibo's unique value proposition, we sell content marketing solutions and service capability into our new product into a blockbuster to all clients in the handset industry. So polymer.
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Just out of typhoon, we hadn't monetizing our traffic through multiple channels, such as membership and E. Commerce. So amplified the commercial value of the platform, especially E. Commerce, that's overseeing a integral part of Weibo's content ecosystem.
The key monetization channel for PC.
2022 in addition to ongoing at completion with Alibaba and JD Dot Com. We also tap into the closed loop commerce, Saudi with the aesthetic medicine industry, which enjoys a relatively high PT Fi featuring ally streaming platform in 2022 to <unk> for them.
Its aesthetic medicine E e-commerce business on LIBOR doubled from the previous year.
Currently although the contribution of revenue and profit posted.
E Commerce business with non material at this stage the combo of online promotion offline conversion could be replicated with more similar industries in the future upon the trial and error.
I think e-commerce business.
It will also help further strengthen user's mindset of e-commerce on Weibo facilitating monetization growth.
As well as providing a strong support for the London AD monetization opportunity.
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Let me share some color overall mining solution strategy in 2023, we'll continue to focus on enhancing the marketing pump, which centers around media and celebrities supported by Kols distribution across verticals, well entertain why traffic contacts which moves from exposure and mine site population.
The sooner, we will beef up weibo's unique Hudson IP and new product launch and also in gaming.
Cause mischief I'm more industries and customers and that further strengthen weibo's core competitiveness in the market.
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In January and February overlap I think Liberty is gradually how they trended month by month and that's due to the outbreak of COVID-19 in various regions Spring Festival, you take time for clients to gradually return to normal life and work, although the country has passed.
Inception, Pete Foster that because that's at most of the companies in time to determine the overall marketing plan for 2020 spring recently, yeah glad to see the issuance of a few days of favorable economic and industry policy. However, when they had to wait a while for a fully public with Actelion I Didnt insight since it takes time.
For the on the policy implementation to macroeconomic rebound and then to pickup of opinions by brand at.
The industry with the tail winds of favorable policy and a stable a copy of the consumer market, the automobile and luxury industry, which had nice growth in 2022, I expect to deliver positive growth in 2023, hopefully as that moved from the cosmetic industry may be seeing growth in the second half of it.
Yeah, assuming new product, a new part of marketing campaigns in the cosmetic industry come back to that time in 2023, we will strengthen weibo's capability of capturing that budget in the cosmetic industry due to optimizing the marketing model featuring celebrities new product and the shopping festivals.
As for the online gaming industry, Yes, do you have them for further revenue growth with the resumption of the gaming license issuance.
In addition, we are also excited to see opportunity in sports betting industry, such as tourism and real estate to recover following the economic rebound.
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In 2023, our AD products fronts, leveraging weibo's strength in content marketing, we will step up our efforts to drive sales and outperformance of Houghton AD product and maximize the monetization efficiency of culture based on traffic.
And Meanwhile, we also continue to explore and expand the talking audience package and improve its reach accuracy and compression, particularly for industries, such as automobiles tourism real estate home furnishing that'd be quiet lead generation, we will further strengthen the synergy between user and AD products too.
He has users' social interaction around at aiming to keep that elevate our capability as opportunities to reach users in multiple scenarios.
The mindset conversion cycle of our social AD offerings as well as publishing moves out.
So I'm Gonna Tuffy Arlington is how would you.
Let me turn the call over to.
T cell for a financial review.
Thank you Augusta and Hello, everyone.
Welcome to <unk> was both quarter on fiscal year 2022 earnings conference call.
With user metrics in December 2017 to Weibo's Ami on average less.
$586 million and 250 per minute, respectively, representing a net addition of 13 million and a $3 million.
All year over year basis, sometimes I need to our user community and engagement remained healthy despite definitely execute as well as disciplined channel investment strategy.
At 21% of card sales and the marketing expenses birthdays plenty of 'twenty one.
Turning to financials.
As a reminder, my prepared remarks or the focus on non-GAAP results.
All monetary amounts are in U S dollar term.
And all the comparisons on a year on year basis, unless otherwise noted.
Now, let me walk you through our financial highlights.
For the fourth quarter and the fiscal year 'twenty two.
We've worked fourth quarter, if anything to our net revenues were $448 million.
<unk> of 27% or 20% constant currency basis.
Operating income was $150 4 million, representing operating margin of 34%.
Net income by cheaper thoughtful label.
<unk> hundred 78, 1 million, representing a net margin of 40%.
Diluted EPS was <unk> 70, <unk> compared to 80% last year.
For full year 2019 to total revenue reached one point 84 billion, a decrease of 19% or 15% on a constant currency basis.
Operating income was 600 111 million.
But then the operating margin of 33%.
Net income attributed to Weibo reached the first signs of a $14 1 million, representing a net margin of tons in that part of that.
Diluted EPS was <unk> 27, compared to 3.08 in 2020 one.
Let me give you a la carte on the fourth quarter and full year 2019 to revenue performance.
Weibo's advertising and marketing revenue for the fourth quarter can you tell me, who was there kind of a license.
Okay.
29% or 22% a cost currency basis.
It's lapping the disruption from Covid research.
And the volatile advertising market.
Are they opening.
Mobile AD revenue was 367 million tons compared to approximately 94% of total AD revenue.
Full year 2017 to advertising and marketing revenue reached one arm 60 billion a day.
<unk> up 19% or 16% constant currency basis with mobile AD revenue contributing 94% of total AD revenue.
The cartoon on Q4 performance Park.
Consistent with our expectations.
Q4 advertising revenue remains under pressure from weak demand that resulted from uncertain macro landscape and the sales execution challenges amid a cool ways back.
In terms of core food and beverage was one of the major of a positive contributor to year over year growth in Q4 with customer embracing the World Cup content season.
We're also delighted to see solid growth with breakthrough products also mobile and entertainment sector.
Customers from this sector leverage our social AD playbook to build hat or there are more of a long tail.
I'm pleased that our field.
<unk> like vertical continued ERP spending trajectory year over year.
Cosmetics and personal care.
Operating from destruction from pandemic wave and the broad a bit syngenta marketing expenses control among our customers.
Yeah.
Moving on to full year financial performance.
Pardon me, if I need to was challenging in many ways.
Weibo's advertising on the Maxim revenue.
And that's in part that Oh, six impressed that worth it.
On a constant currency basis.
With uncertain coli policies and the volatile macro economy waning overall advertiser demand.
Industry, our largest us very vertical what unsafety grocery products and e-commerce.
It's back to World all lending also mobile and luxury sector outperformed.
Underpinned by secondary payer wins illustrate the regimens.
Our unique value proposition of our ad offerings.
However, the rest all consumption related article with an e-commerce fast abroad bad habit.
Yes, the backdrop of weak cause some of that data.
I'm, a conservative marketing budget.
AD product.
Promoted fees was the largest.
All of those social display ads and the topic of approach.
Importantly in light of industry wide pricing pressure.
The amount that we proactively built up our performance based AD capabilities on the content marketing offerings to adjust FERC Parnell at Goldman.
We're also delighted to see Fuller realization trend our AD revenue makes good sense to radio traffic uptick an optimized lead.
You add technologies.
AD revenues from Alibaba for the fourth quarter were 42 upon for a million dollars a decrease of 7%.
Increase of 3% constant currency basis.
With pent up AD budget released to driving inventory a clearer during the February 11 shopping festival.
Full year AD revenues from Alibaba Secret attempted third part that to one side or the 7 million correlating with is called server type of market strategies in 2022 and may the recurrent business disruptions.
Before turning to that segment, let me share some preliminary color on the chess entering 'twenty pedigree.
A part of it and Paris with Colorado situation during the past three years, we kicked off 2023, basically opening and the gradual normalization in business activities.
Despite limited visibility in the recovery pace of macro economy, and the consumption of it.
We believe the worst is behind us and the way I kind of more constructive on the broad recovery of advertising market in 2020 three.
With many sectors rebates in 2017 truth, our teams will build up scale execution and work relentlessly to capture higher AD wallet of patent type of budget from consumption sector.
So that sector is seeing secular growth.
Tailwind.
Such as all the mobile and online gaming.
Leverage at our full spectrum of social ad offerings.
We remain confident in our long term monetization opportunities that are unique or battle preparation and to diversify the content ecosystem will unlock.
Yeah.
Value added service Vas revenues were 57 5 billion in the fourth quarter a decrease.
Of 12% or 12% constant currency basis. The decrease in that revenue was mainly due to less revenue contribution from our membership services.
Live streaming business.
Full year, if anytime you talk about the revenues decreased 13% to 239 7 million, mainly due to less revenue contribution from membership services.
<unk> business as well.
Turning to costs and expenses totaled.
Total costs and expenses for the fourth quarter were 296 made it a decrease of 25% demonstrating strong execution of our efficiency initiative.
The reduction flowed into each cost and expense item.
That's true ongoing stringent cost control a matter a virus accretion that's wrong, especially disciplined channel investments and the optimization of organizational structure.
All your costs and expenses totaled $1 24 billion a decrease of 13%.
He came to our commitment to a stable life earnings against the top them brighter.
Plenty of telling your story will continue to be a year of efficiency for us.
Solid execution of cost optimization initiatives in 2022 they have anymore, but maybe some more bulk as a team and a leaner cost structure.
<unk> us a clear path to earnings growth in 2020 three.
Operating income in the fourth quarter was up 152 million, representing operating margin of 34% compared to 36 in the same period last year.
Operating income for full year, 2017 was $601 1 million, representing an operating margin of 33% compared to a 37 part that you're trying to tell you what.
Turning to income tax and GAAP measure income tax benefit for the fourth quarter.
Was 18 7 million comparatively, but a $45 6 million last year.
Change in income tax amount was what.
It was primarily due to first.
A reversal of tax liabilities recognized related to our Perkins had Croatia and second lower taxable income in the fourth quarter of 2022 berth at the same period last year full year income tax expenses.
Well, starting with Australia, compared to 138 8 million and 20 times, what the decrease was mainly resulting from.
Lower taxable income in 2022 versus 2021, and the second the reversal of tax liabilities recognized related to uncertain tax provision.
Okay.
Net income attributable to our label.
Fourth quarter.
178, 5 million, representing a net margin of 40% compared to 32% last year.
That is comparable year 2022 was 500 and the 14th blood money.
Representing a net margin of 29% compared to 32% of plenty plenty box.
Turning to our balance sheet on the cash flow items as of December 31st plenty plenty to weibo's cash cash equivalents and short term investments.
What are the Threep on the 17 billion.
Comparative tour Gray Pond 13 billion as of December 30, correct plenty plenty of work.
The first quarter cash provided by operating activities was 158 7 million.
Capital expenditures totaled 50, a pause for a minute on.
And the depreciation and amortization expenses amounted to $12 4 billion.
A full year basis cash provided that the outbreak activities with lifetime Jade.
Capital expenditures totaled 43 1 million.
And the depreciation and amortization expenses amounted 54 upon the seven minutes.
With that let me now it's hard to call over to the operator for the Q&A session.
Thank you we will now begin the question.
Okay.
To answer a question. Please press star one one on your telephone and wait for your name to be now.
To withdraw your question. Please press star one again.
Please standby, while we compile the Q&A roster.
Our first question comes from the line of Timothy Zhao from Goldman Sachs. Please ask your question Timothy.
Okay.
Hello, guys.
Thanks Owen.
Do you think that's homogeneous with Q2.
Hum.
Yes.
<unk>, Colorado.
Sure.
You might want to kind of a nutshell.
Hopefully that helps.
Quiet.
Oh I see okay.
We have a choice.
Pete.
Sure.
Pretty close.
Okay.
Sure.
Yes.
Sure.
Thank you Neil.
We call it which one.
Alright, Thank you Sir.
Thank you management for taking my question I have two questions first of all please share with us.
Around the monthly trend of at revenue recovery and year on year growth trend from first quarter last year to January and February this year.
The recovery path before us across.
Yeah.
And secondly, the amortization plan for the new year.
Is there any new AD product all monetization models that we may launch for this year. Thank you.
Question <unk>, the imaging is because you're doing that.
And then Sherry actually sure.
Yeah sure sure sure don't comment on actually getting Saracen.
Sure sure Fair Beijing and Shanghai.
Did I hear you Jamie.
Sure Sam.
Pulpwood quickly.
Covanta commercial gallery, you can't do that for me.
Diehard actually a data.
Thank you Daniel.
So he is working with him and what her tumor company.
Hi, Scott.
So he can share beyond the language.
Italy's yet.
That's what I'm talking about.
Yes sure.
That'd be helpful I'll touch on that correct.
Okay. Thank you for the question, let me answer the first one first so first of all in last Q4, especially in October and also in December of last year, we've been having some of the political issues happening and also from December to January of last year of this.
This year also we had the Covid and are ramping and also infections here in Shanghai and Beijing very quickly. So that I can say that in December of last year, we've been having negative impact on our operations and also somewhat negative impact due to the lower budget allocated by our customers.
But we were never having a big impact from the World Cup preparation and also operations because of our close loop preparation of that World Cup itself as an event.
So overall speaking last year in Q4, we had some of the missing.
And also some of the.
The impact on the overall business.
A lot of accidents and also a lot of issues happening in December of last year.
Right.
No change at all if.
<unk> you anchor yourself.
We don't believe will be helpful. Thanks.
It will show together you can Sean.
Amongst and between chip can be so you got.
<unk>.
You can answer.
Sure.
Tidewater couldn't ship artisans generically what you're doing.
Oh, My God <unk> Junior immediately.
With that Shannon Sharpe.
I wouldnt cohorts using that to either a prolonged downturn.
So that's why that I apologize.
No.
<unk> I don't watch any unusual pay downs, yet quite sure Dan Shannon I'm, hoping you can help with.
<unk> hired from the second quarter.
For the kitchen. So it's always one woman that's also kind of a quick one.
So the client attrition <unk>, it's all good.
Okay.
Got it.
Hum.
And also in January and also February of this year in January we had the Chinese new year and also of course from the standpoint of cockpit, we had actually a lot of growth on that.
But still if you're talking about the advertisement businesses. We did not have a very good comparison, if you're talking about.
Year on year basis, and also of course, if they're talking about quarter on quarter and definitely speaking we had increased but that was not an appropriate and legitimate compare comparison and also a second point is that in February we had the recovery, but the thing is that if you are talking about the budget given by the customers while they were doing the marketing.
<unk> for Q1 normally this particular plan was already made in December of last year. So these customers, we're putting much conservative back in December of last year, we've been seeing some recoveries in the mobile phone industry and also entertainment industry as well.
Still I know the budget on the FMC G and also from the e-commerce industry verticals.
Hi, Doug.
Have been postponed until the two sessions up in <unk> this year or after April so that we believe that we are going to wait until the late March or early April close to have an overall and also appropriate.
Of the recovery speed up the whole industry.
Okay.
It was one client that.
Sure Sharon can you each of the war for talent.
<unk> issued a harder thing shopping chunk Linda.
<unk> ownership.
So as our opinions of local Marshall with our children equally.
I think when Geneva show in Orlando before Louis when you take a hedge on that icon.
One thing you did was you won't wait times are so cheap of course hurricanes. This year, its usually a partnership with Apple.
Tim and Patrick Swayze, Olin Chantal some good financials behind the slowdown or yellow my pleasure, but had little Gwen.
Moving to <unk>.
About 20, even higher from that it's all about LNG.
To deliver sandor annually now aren't you.
Got it.
The shutdown of a shutdown not that mature tenants when we welcome all of you sent out oriented ultrashort.
Now I'll turn the short of it.
Yes, Joshua <unk> Therapeutics, Inc.
Great work going on there.
Yes.
And also in terms of the detail verticals. So two thirds of our total revenue from the water from the.
Verticals that were related to consumption in Q1 of this year.
Speaking of FMC, GE preschool products and e-commerce et cetera, et cetera. So it is pretty much subject to the macro economic recovery and also theyre, probably up the consumption power as a whole for the society.
Also in Q1 of this year, we've been seeing a very good thing about the launch of the new products by the <unk> products industry or the luxury of vertical.
But still you know we were not positive.
Total shipments of mobile almost smartphones, but still what's good.
Is that the.
Manufacturers or those Oems and we're pretty much focusing on the medium to high end smartphones. So this is something that is beneficial to us and also in 2022 I know we had witnessed a 15% decrease in terms of the total sales volume, but still you know in terms of Weibo.
<unk> and the revenue we had a very good stabilizing.
Client and also a bit of an increase on the revenue. So that so we are very much positive in this new year, especially with an increasing sales volume.
Our phones and also some of the other.
<unk> related products.
Okay.
No they won't show in Shanghai, one chance, you're partially gone petroleum stronger how much I know you guys don't kind of international onshore our opinions on retention 100 zone.
I don't think that I don't know, which I'm answering machine already in Chicago, which is the highest steam going into the country.
Thanks, Jim Heaney Shardana usage here.
Got you and there shouldn't be done.
So it was on <unk> actually it will be all calling you, but Sean Gray box clinical portfolio turns out when you need or.
Daniel Italia good.
Sure.
Got it.
And the next vertical is on the automotive so last year, we had a very good development in terms of your bet is some revenue on the automotive industry and also in 2023 years with a further electrification of the whole industry and also with a more and more intense competition on this whole industry Weibo will leverage further.
Ability of promoting the new products marketing and also to the advertisement on that.
So you can see that after Q1 of this year. We've been already has seen a very positive trend of the growth from Weibo's side.
Okay.
So it is our opinion in Chicago to develop all the time and apologize to you who kind of has a scrimmage.
The woman to change here at a time when a client I don't know.
Which is another hurricane charter in charter format with a mapping Taiwan China.
China show about April .
<unk> sure well known to us that Chitra, who should you hire or mccarrick tushar function Shanghai, Jonathan Neeley in Charlotte.
As usual selection telecom module I will then touch on you made huge automation, where Cushing Domino LIBOR pulling it up here at Homeaway.
Chunghwa Guangzhou and Shenzhen.
John I'm not sure.
That should go higher <unk> Michel shop.
I've actually gone that far yet.
And Sharon I'm sure all of you are challenging to me.
Our financial ruin.
Today is about Tonight, you got Marcia forgot I'll come to that Yoichi, <unk>, Hi, Andy mentioned, Russia P. M here for sure.
Sure.
<unk> <unk>.
So assets Bajaj and Thats, what is that going to the highest loyalty test that you're going to answer your questions.
Got it.
And also the next one is on the strategy of our advertisement and also those in.
<unk> products in 2023, so as I was already stated in the prepared remarks that in most of the time last year, we had been promoting the advancements of brand plus performance, but actually in 2022 and it was for some of the verticals for instance, automotive one and also the smartphones we had.
Try and apart from having the brand and performance.
<unk> also some of the new ways of doing marketing by our content and also hot trends for instance, we had a integrate changed in a matter of.
Combining the media and <unk> and some of the exposures them altogether to obtain.
Well more budget from our customers in terms of the marketing and advertisement. So in 2023. This particular integrated way up doing the latest one is also going to be continued and also for especially for some of the new product launch from the industry is like a luxury products and also.
The smartphones.
Also penetrating duckworth.
Questions et cetera.
Okay.
Uh huh.
So I think that will challenge, it's our opinion that in Russia.
Shawn Harrison that'd be I'll call it an opportunity similar momentum Goodnight.
So how are you accounting.
Sure.
Now China Cushing.
Sanjay you don't mention these yeah, hi, Anthony.
Sure I'll answer element of it that caused that margin.
So all of this year.
So on the overall basis in 2023 first half we're still experience a lot of uncertainties, but the core thing here is that we have to further enhance our marketing efficiency and also operational efficiency and also really trying to laser focus on those pages areas has continued.
Thank you.
Our next question comes from the line of Felix Liu from UBS. Please ask your question.
She said plenty of times.
What <unk> done that themselves.
Without your shiny R&D element that somebody's going to tag on to all the people that didn't get.
Thank God, just ship Honeywell and young woman that's required.
On the Chartwell.
The total debt.
I'd say, it's all of the <unk>.
Let me translate myself thank.
Thank you management for taking my question. My question is on the efficiency improvements and cost controls that we have done very well in 2022. So looking ahead into 2023.
What are our plans are.
And it is improving cost control.
Is there any pace or trends that we can expect on the investment side. Thank you.
No.
Hernia kind of on the children to each bleeds and the G&A are geopressured digital marginal care fashion that schulman to Orange cacciatore here jump in some shopping and what kind of time here in the near term, let's say on <unk> shutdown passenger.
The main reason.
I wasn't sure that he and Iris and GWA ethane or change your loss ratio.
<unk> kind of unless there's anything that's on its way out.
Gotcha.
That's a safer bet.
Nothing was shut down for those how about Magellan Rx's oil Natasha says it all.
Modest korlym what countries, you can sort of Joey Wat.
Tables are now on charter two minutes, you can calculate final diehard fan yet.
Jonathan you consider them at that time, they had to pay your question huge element pushing for that.
That type of M&A.
That's how you doing.
Sure.
Yeah.
Okay.
So for this particular question first of all in 2022, we had already had the impact from Covid starting from the end of Q1 and also our continued one time deposits by from Q2. So we started to actually to reduce the cost and improve our efficiency starting from them. So in 2022, the overall cost.
Phoenix and reduced by more than 10% versus 2021 and also of course this year the major way for us to further improve the efficiency and also reduce the cost is by further reducing the marketing related expenses by as many as 20% and also in Q4 at the end of <unk>.
Q4, we started to add channels to the reorganization of our structure of the company and this is going to generate impact things 2023. So let's just say that from this year onwards, we're going to really continue focusing on our core businesses and also really have a very flexible financial and also.
Accounting performance and also really have a very sustainable competitive that's been built continuously.
Okay.
So we mentioned the.
San Jamar tweaking our.
Our special General quick one that shows them that Belgium down that comes out.
<unk>, which is shorter.
<unk> I forgot to answer your question really eliminating shops to achieve again not to go to our foundry.
Jonathan.
Yes.
So it sounds as high volume and she was everyone and of course, you don't want any man.
<unk> change on the Incrementals, you're calling them.
Sure.
Earning our union, So EMEA Asia Eastern region Asia.
And that's one of my favorite kind of touched on.
The amount of unusual.
Our answer usually seasonally down Tricia said, a question of continuing manual retroactively from everything else its all of that material.
Our son Nguyen.
<unk> consider being shown at <unk>.
Good morning Julien.
And we'll go after the Australia continuing.
The shorter production compound to do an acquisition until that Guy, who says Oh My God <unk> got it.
Hum.
And also in 2023 key focus will still be the further recovery of our revenue and also the topic as well and also further increase our operational efficiency. So as I have already said that wed been starting doing the reorganization or restructuring of our organization since the end of Q.
Paul and this had a little bit impact, an especially positive ones.
And profit margin, but it is going to generate a higher impact in 2023.
With regards to the profit and margin and also before 2021, we had the total operational cost.
Which was around like 60% of total revenue and this particular figure has been increasing to around 65% up at <unk> due to the impact of Covid and also in 2022 because of some other issues today with the Covid. We had this particular operational cost.
As high as 70% in some patients or some of the months and quarters, but in 2023. Our focus is that we want to regain our operational efficiency and also we'd like to have the operation efficiency recovered to the approximate level an appropriate level.
Which was about the level of 2019 or 2020. This is a continued going to be our goal and objective and also of course that so we really wanted to realize the enhancement of the operation efficiency on top of the recovery of our traffic and also the revenue as well this is going to be.
The objectives for our company in 2023 and onwards.
Okay.
Okay.
Thank you.
Interest of time I would like to take a last question from Jean <unk> from CIBC.
Please go ahead strategy.
It should be a conflict on her way founded in 90 days.
Since you get with <unk>.
I wish I knew.
Thank you.
Julian would you acquire the trivial relationship of Jamba Iot shoes, she's dealt with it being down her of course, you don't want nothing to Goldman Sachs.
So my question is related to that business.
Management, showing us this gesture raspings intends to 'twenty three.
So what's your progress and the outlook on social ecommerce bin.
Thank you.
Yeah.
But.
So that is a significant loss in Paris, Ontario, I'm kind of hanging out there I'm going to now quite a you know shale gas onto your confidence level, and then I'm not even sure egencia.
Tincher, Hong Kong, Russia.
<unk> has long demo finish with Oklahoma, Alfonso and I assure you of course, what are you going to.
Kind of shadowed him fashion that you've got Marcia alright. Thanks, a question.
A question on here in <unk>.
<unk>, that's a new tender.
So you can either when we relaunch ecolab.
Oh God.
Thank you hilly.
Shanghai I know Joe you the Coker and then down at the hotel in Shanghai, and how they're being ashamed Moshe equal how much youre going to shy away from colleges now R&M Pizza Xian Canadian Sunday attrition.
<unk> home hydraulic fracturing out there.
Tissues once you lock in Washington, and one in Charlotte.
Now naturally also can grow no claims you're buoy up our corner Xiaomi.
When Michelle I pushed you can go there you go.
Let me take a moment to mention here I mentioned shifted everybody's yet.
Got it.
Hum.
Hmm.
So thank you for those questions.
What about the non AD businesses, we're talking about is social and.
E Commerce and also the membership services.
So of course for the social E Commerce definitely can now primarily speaking about trying the advertisement model for instance form the alliance together would be Alibaba or J D and also to realize the traffic monetization.
Of course last year, we've been trying to some of the closed loop he comments as well and especially focusing on a scenario of O to O Kudos high <unk> customers and we found that the efficiency of the traffic monetization was way higher than that.
But it's a module only so in 2020, we are able to further increase the total scale and also not just scale in size and also enlarge our market share by leveraging the method of club for example E Commerce.
Live streaming or some of the key like the celebrities are not screening and also we are trying our best to really obtain as many customers with a high <unk> value as possible.
Okay.
The new manager.
We definitely on I don't know how much you got a hardware box understanding between content on the module.
The interior to question the higher the booklet tabled finish and show.
That had union without it.
Sure EBITDA Colorado's tip.
And if I may and I don't know one element of our Shannon in the army.
Actually diesel between Asia Shanghai.
Danielle upon our reinsurance team without Nalco Chancellor Commission straight away.
When Michelle ash or in the gold equivalent tuned down the tuna and that's it for me and I don't know.
Final quick one.
<unk> got shaping that's even a year ago.
Sure.
The agenda.
Michelle could you quantify the film of course, the actual condition of that lever if I'm at.
<unk> got chip.
And also last fall is that talk about some of the membership service. So that you can see that now are the primary part of.
The membership revenue was contributed from the Weibo membership itself, which was a contributor.
As many as $500 million to $600 million a year.
This was actually in a very friction part of our total revenue, but still that was very much.
Much enjoining, a high gross margin for the Weibo membership business and in 2022, and especially in the second half we had to be a ratification and also the some kind of adjustments.
The adjustment of the entertainment industry. So this particular business.
Witnessed or experienced various first.
Drop or decrease of the contribution to the revenue for the first time in the history. However in 2023, while we have seen a recovery of the entertainment Unculture industry and also with regards to the expectation of increasing revenue, we really hope that we could really develop this way board membership.
This further because nowadays the Dia your penetration is very low or relatively lower than expected. So that is to say that there is still a large room for further improvement and we really hope that weibo membership business is going to contribute more to our total revenue and also to the profit.
And the specific patients.
Thank you.
Great. Thank you very much for your questions I would now like to turn the conference back to Ms. Sandra Zhang for closing remarks.
<unk>.
Since the upgrade here.
Thank you all for joining US we'll see you next quarter.
Thank you. This concludes today's conference call. Thank you for participating you may now disconnect.
Okay.
Totally to raise and lower Johan during Q&A, you can dial star one one.
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