Q4 2023 Sohu.com Ltd Earnings Call
Operator: Subs by www.zeoranger.co.uk Ladies and gentlemen, thank you for standing by, and good evening. Thank you for joining Sohu's fourth quarter 2023 earnings conference call. At this time, all participants are in the listen-only mode.
Okay.
Ladies and gentlemen, thank you for standing by and good evening. Thank you for joining so whose fourth quarter 2023 earnings conference call.
At this time all participants are in a listen only mode. After management's prepared remarks, there'll be a question and answer session.
Operator: After management's prepared remarks, there will be a question and answer session. Today's conference call is being recorded. If you have any objections, you may disconnect at this time. I would now like to turn the conference over to your host for today's conference call, Pu Huang, Investor Relations Director of Sohu. Please go ahead.
Today's conference call is being recorded if you have any objections you may disconnect at this time.
I would now like to turn the comprehensive blood to your host for today's conference call One pool Investor Relations director of Sohu. Please go ahead.
Pu Huang: Thanks, operator. Thank you for joining us to discuss Sohu's fourth quarter 2023 results. On the call are our chairman and chief executive officer, Dr. Charles Zhang, CFO John Lui, and the vice president of finance, James Deng. Also with us are Chang You, CEO Dewen Chen, and CFO Bin Wang. Before management begins their prepared remarks, I would like to remind you of the conference safe harbor statement in connection with today's conference call. Except for the historical information contained herein, the matters discussed on this call may contain forwarding statements. These statements are based on current plans, estimates, and projections, and therefore, you should not place undue reliance on them. Forelooking statements involve inherent risks and uncertainties. We caution you that a number of important factors could cause X-results to differ significantly from those contained in any foregoing statement.
Thanks, operator, thank you for joining us to discuss those fourth quarter turns out to their sort of results on the call I'll share a mountain of cheap because I don't think they're tox, Charles Zhang CFO and Vice President Joe This is Tom.
Also with US a challenge to say auto insurance and let's see if you all being wrong.
Before management begins their prepared remarks, I would like to remind you of the Companys Safe Harbor statement in connection with today's conference call.
Except for the he's talking information contained herein. The matters discussed on this call may contain forward looking statements. These statements are based on current plans estimates projections and therefore, you should not place undue it I found that.
These statements involve risks and uncertainties, we caution you that a number of important factors could cause actual results to differ materially from those content any forward looking statements.
Pu Huang: For more information about the potential risks and uncertainties, please refer to Commerce's filings with the Security and Exchange Commission, including its most recent annual report on Form 20-F. With that, I will now turn the call over to Dr. Charles Zhang. Charles, please proceed. Thanks, Huangpu, and thank you everyone for joining our call. In the fourth quarter of 2023, we will continue to optimize operating efficiency with strict budget control. Despite the external economic environment and cautious budgeting by advertisers, Thanks to these efforts, our bottom line performance hit the high end of our guidance for the fourth quarter of 2023, and Sohu Media Portal further refines our product, upgrading technology and expanded premium content offerings, resulting in an enhanced user experience. At Sohu Video, we continue to execute our twin engine strategy by developing engaging long and short form content.
For more information about the potential risks and uncertainties. Please refer to the Congress bodies with us at Coty and Exchange Commission, including our most recent annual report on form 20-F with that I'll now turn the call although to Dr. Charles Zhang Charles Please proceed.
Thanks.
And thank you everyone.
Oh no.
Fourth quarter.
I'm sorry.
We continue to optimize operating efficiency with a strict budget control.
Despite the external economic environment.
Congress budgeting.
Advertisers.
Thanks to these efforts our Bottomline performance hit the high end of our guidance for the fourth quarter of 2023.
Sohu media portal, we further refined our products.
<unk> upgraded technology and expand.
Expanded premium content offerings, resulting in that.
Using scarce.
And so for video we continue to execute our 10th straight twin engine strategy.
European engaging long and short form content.
Chaoyang Zhang: In addition to the social network distribution of short-form content, we also worked hard on science-based live broadcasting and other live broadcasting events, which further boosted user interactions and engagement on our platform. We also proactively explored diversified monetization opportunities by integrating our advantageous resources and hosting various content marketing campaigns with our unique IPs. Lastly, our online game business remained stable, delivering revenues in line with our expectations.
In addition to the social distribution of social networks distribution of short form content. We also work hard science based live broadcasting and other live broadcasting events, which further boosted user interactions and engagement on our platforms.
We also proactively explored.
Notified the monetization opportunities by integrating our advantages advantages resources in house to embarrass content marketing campaign with our unique IP.
Lastly, our online game business remained stable delivering revenues in line with our expectations.
Chaoyang Zhang: Before going through each business unit in more detail, let me first give you a quick overview of our financial performance. For the fourth quarter of 2023, total revenues were $141 million, down 12% year over year and 3% quarter over quarter. $20 million, down 30% year over year and 9% quarter over quarter. Online Game Ram News earned $115 million, down 5% year-over-year and 2% quarter-over-quarter. Gap net loss attributable to Sohu.com Limited was $13 million, compared with a loss of $7 million in the fourth quarter of 2022 and a net loss of $14 million in the third quarter of 2023. The non-GAAP net loss attributable to Sohu.com Limited was $11 million, compared with a net loss of $2 million in the fourth quarter of 2022 and a net loss of $10 million in the third quarter of 2023.
We're going through each business unit in more detail. Let me first give you a quick overview of our financial performance.
For the fourth quarter of 2023 total revenues of $141 million.
Down, 12% year over year, and 3% quarter over quarter.
Brand advertising revenues.
$20 million down, 30% year over year and 9% quarter.
Quarter over quarter.
Online game revenues.
$110 million down, 5% year over year, and 2% quarter over quarter.
GAAP net loss attributable to <unk> Dot Com limited.
$13 million.
Compared with <unk> seven.
$7 million in the fourth quarter of 2022, and a net loss of $14 million in the third quarter of 2023.
non-GAAP net loss attributable to Sohu Dot Com limited was $11 million.
Compared with a net loss of $2 million in the fourth quarter of 2022.
And a net loss of $10 million in the third quarter of 2023.
Chaoyang Zhang: For the full year of 2023, total revenues were $601 million, down 18% compared with 2022. Brand Adapting Ram Neos, $89 million, down 14% compared with 2022, and online game revenues were $480 million, down 18% compared with 2022. Gap net loss attributable to Sohu.com Limited was $66 million, compared with a net loss of $17 million in 2022. Nongap Netlock Attributable to Sohu.com Limited, All right.
For the full year of 2003.
Total revenues $601 million down.
Down 18% compared with 2022.
Brand advertising revenues 80.
$89 million.
14, 14% compared with 2022.
Online game revenues $480 million down 18.
18% as compared with 2022.
GAAP net loss attributable to <unk> Dot Com limited was.
$66 million compared with a net loss of $17 million in 2022.
non-GAAP net loss attributable to Sohu Dot Com limited.
Chaoyang Zhang: $51 million, compared with a net income of $2 million. Now I will go through our key businesses in more detail, for Media, Portal, and Social Video. At Soho Media Portal in 2023, we focus on improving the user experience through algorithms and product optimization. We continue to refine our operations, expand our premium content offering, and diversify their delivery formats, which resulted in stable user metrics and user stickiness. Simultaneously, we also focus on the generation and distribution of premium content. While driving content consumption, we continuously enhance the social features. Social network features, which not only enhanced interactions between users but also stimulated the generation and social distribution of more high-quality content. As Sohu Video, we continue to execute our Tune Engine strategy to expand and diversify our offerings across different formats, including live streaming content. In 2023, we released several original content, including the crime-themed idol romance drama, Love of Replica.??
Well.
$51 million compared with net income of two minutes.
Hi.
Now I will go through our key businesses in more detail.
Firstly media portal and Sohu video.
Sohu media portal in 2023, we focus on improving the user experience through algorithms and product optimization.
We continue to refine our operations expand our premium content offerings and diversify their delivery formats, which resulted in a stable user metrics and user stickiness.
Simultaneously, we also focus on lead generation and distribution of premium content.
Well driving the content Consumptions, we continuously enhance the social features.
Core features which not only enhanced interactions between users, but also stimulated the generation and social distribution of more high quality content.
And Sohu video, we continue to execute our twin engine strategy to expand and diversify our offerings across different formats, including live streaming content. In 2023, we released several original content, including the crime theme.
Romance drama.
Our love of replica when you're gone online.
Chaoyang Zhang: Reality shows, this is me, ????. And the high summer trend, ???????? and Chuanxi Tubu. These series have generated widespread, discussions across various social media platforms. For short-form format and live streaming, we reinforced our leading position in knowledge and science-related live streaming with highly regarded IP, Charles Fiske Strauss. Since the launch of the Health Physics class in November 2021, the class has live streamed over 200 online live broadcasts, held more than 20 offline seminars, and published two science books, and the third one is coming, forming a continuous.., multidimensional dissemination.
Reality shows this is the meat, Germany and the high summer trend shall we want a shot here.
And <unk>.
This series has generated widespread.
Skechers across various social media platforms.
For short form format.
And live streaming we reinforced our leading position in knowledge and science related live streaming.
Got.
Charles Physics Trust.
Leading the way.
Since the launch of the health Physic fast in November 2021.
The crowd have live streamed over 200 live broadcasts.
Held more than 20 offline seminar.
The published two books.
And the third one is coming.
Forming a continuous.
Morgan dimension of this investment.
Dissemination.
Chaoyang Zhang: We launched a series of online and offline child physics classes during the quarter, attracting millions of viewers of all ages, especially the younger generation, across different platforms. This further consolidated our position and unique competitive advantages in the popular science and knowledge dissemination verticals and demonstrated an upward value in our commitment to being a socially responsible media platform. We also proactively promoted the social distribution features and enhanced the broadcaster's ecosystem by hosting various events centered on hot topics. In the fourth quarter of 2023, we successfully hosted the 2023 Sohu Dancing Festival, the K-pop, and the 2023 Sohu Hanfu Festival.
We launched a series of online and offline and talk through the cloud during the quarter.
Attracting millions of viewers of all ages.
Especially the youngsters young younger generation across different platforms.
This further consolidated our position in the unique competitive advantages in the popular science and knowledge.
Nation verticals and demonstrated an upward value and our commitment to being a socially responsible media platform.
We also proactively promoted the social distribution features and enhanced the broadcasters ecosystem by hosting various events centered on hot topics in the fourth quarter of 2023, we successfully hosted the 2023 Sohu Dancing Festival.
Pop.
In 2023, so who have food festival.
Chaoyang Zhang: These live broadcasting events brought together users with common interests on our platform, enhancing the vitality and engagement of our user community both online and offline. On the monetization side, despite advertisers' we explored monetization opportunities by strategically integrating resources across our product metrics. Empowered by our distinctive IP, the Physics Class, we hosted various innovative content marketing campaigns such as Talk Under the Starry Sky and Talk on Top of Snow Mountain, which served as a continuous source of premium content and sparked discussions and dissemination across multiple platforms.
These live broadcasting events brought together users with common interest to our platform enhancing the vitality and engagement.
When they are user community.
Online and offline.
On the monetization side despite advertisers.
Our cautious approach, we explore the monetization opportunities by strategically integrating resources across our product metrics.
Empowered by our distinctive IP the physics class, we hosted the various innovative content marketing campaigns, such as tuck under the Steri Sky and talk on top of the mountain, which served as a continued source of premium content.
<unk> discussions.
Dissemination across multiple platforms.
Chaoyang Zhang: These events gained widespread recognition from advertisers, significantly expanding our monetization abilities, and highlighted our Competitive Advantage. Besides these innovative events, we also continue to host our traditional flagship events, such as Sohu Finance Ending Forum, Sohu Fashion Awards, and Leveraging these high-profile events, we were able to better meet advertisers' needs, further consolidate our influence, and differentiated advantages as mainstream media platforms. Next turning to the online game business. During the fourth quarter of 2023, online game revenues were in line with our expectations. When they are a PC game business, we revamped. The skill sets of each clan in regular TLBB PC highlight their respective characteristics and allow players to combine skills more freely. With TLBB Vintage, we introduced new gear and a related development system to enrich players' battle strategies.
These events again widespread recognition from advertisers significantly expanding our monetization abilities and highlighted.
Our competitive advantage.
Besides these innovative.
We also continue to host our traditional flagship events such as so we will finance any forum.
Who.
Fashion Award.
And.
Leveraging these high profile events.
We were able to better meet advertisers' needs.
The consolidate our influence.
And differentiated advantages.
<unk> media platform.
Now turning to the online game business during the fourth quarter 2023 online game revenues were in line with our expectations.
When they are our PC game business, we ramp.
Revamped.
Our revamped.
The skill sets of its class irregularity RVB PC to highlight their respective.
Characteristics and allow players to come about combined skills more freely.
With <unk> vintage, we introduced new gear and it related development system to enrich players battle strategies.
Chaoyang Zhang: In our mobile game business, we upgraded character attributes and many other aspects of a major client in Legacy TLBB Mobile, which helped to increase player engagement. Next quarter, we will launch expansion packs and content updates for the GLBB series and other titles to keep players engaged. Our top game strategy will continue to guide us going forward as gaming technology rapidly advances and market demand becomes deeper and more diversified. We will creatively explore new ways to better meet players' needs and expand our portfolio for international markets. allocate additional resources to professional talent development and invest in content and technology innovation to bring more high-quality games to the market.
In our mobile game business, we upgraded character attributes and many other aspects of it.
A major crime in legacy <unk> mobile, which helped to increase player engagement.
Next quarter, we will launch the expansion packs and the content updates for the <unk>.
<unk> Sirius.
And other titles to keep players engaged.
Our top games strategy will continue to guide us going forward as gaming technology rapidly advances and the market demand becomes.
Deeper and more diversified.
We will creatively explore new ways to better meet players' needs expand our portfolio for international markets.
Allocate additional resources to professional talent development and invest in content and technology innovation to bring more high quality games to the market.
Chaoyang Zhang: We will maintain our core competitiveness in developing MMORPGs going forward while also producing card-based RPGs, sports games, and casual games. Before I pass the call to Joanna to go through our financial results in detail, we are pleased to announce that on March Second, a few days ago, 2024, our board of directors authorized an increase in Sohu's previously announced share purchase program from up to $80 million to up to $150 million of the outstanding ADS shares of Sohu over a two-year period. As of February 29th, 2024, Sohu had repurchased approximately 1.3 million ADS shares, ADS, under the Shared Repurchase Program for an aggregate cost of approximately $12 million. With that, I will now turn the call over to Joanna. Thank you, Charles.
We will maintain our core competitiveness in developing MMO RPG going forward, while also producing card based RPG sports games and casual games.
Before I pass the call to join US go through our financial results in detail we are pleased.
To announce that.
March 2nd a few days ago 2024, our board of directors.
Authorized an increase in sales was the previously announced share purchase.
Program from up to $80 million to up to $115 million.
Of the outstanding shares.
Over a two year period.
As of February 29, 2024, so we had the repurchase of approximately $1 3 million in EBIT share ideas.
Under the share.
Purchase program for an aggregate.
Cost approximately $12 million.
With that I'll now turn the call over to Joanna.
Joanna: I will now walk you through the key financials of our major segments for the fourth quarter and the full year of 2023. All the numbers are on a non-GAAP basis. You may find the reconciliation of non-GAAP-to-GAAP measures on our website.
Chuck.
I will now walk you through the key financials of our major segments for the fourth quarter and full year of 2023.
All the numbers on a non-GAAP basis, you may find a reconciliation from non-GAAP to GAAP measures.
Our web site.
Joanna: For Sohu Media Portal, quarterly revenues were $16 million, compared with revenue of $21 million in the same quarter last year. The quarterly operating loss was $36 million, compared with an operating loss of $33 million in the same quarter last year. For the full year 2023, Social media portal revenues were $66 million, compared with revenues of $77 million in 2022. The full-year operating loss was $139 million, compared with an operating loss of $161 million in 2022 for Sohu Video. Quarterly revenues were $9 million, compared with revenue of $16 million in the same quarter last year. Additionally, the operating loss was $32 million, compared with an operating loss of $21 million in the same quarter last year. For the full year 2023, Video revenues were $47 million, compared with revenues of $63 million in 2020. The 4-year operating loss was $130 million, compared with an operating loss of $99 million in 2020 for Chaoyang's online game business and 17173.
For Sohu media portal quarterly revenues were $16 million.
<unk> revenue of 71 million and that was.
I was there last year.
The quarterly operating loss was $36 million.
Compared with operating loss of $33 million in the same quarter last year.
For the full year 2023.
So on media portal revenues were $66 million.
Compared with revenues of $77 million in 2022.
The full year operating loss was $139 million compared with operating loss of $161 million in 2022.
So social video.
Quarterly revenues were $9 million compared with revenue of $16 million in the same quarter last year.
Quarterly operating loss was $32 million.
<unk> operating loss of $21 million in the same quarter last year.
For the full year 2023.
Video revenue was $47 million compared with revenues of $63 million in 2022.
Full year operating loss was $113 million compared with an operating loss of $99 million in 2022.
So Charles online game business and the one seven <unk>.
Quarterly revenues.
Hundred $16 million compared with revenue of $122 million in the same quarter last year.
Joanna: Quantity revenues were $116 million, compared with revenues of $122 million in the same quarter last year. Quarterly operating profit was $47 million, compared with an operating profit of $54 million in the same quarter last year. For the full year 2023, Chaoyang's online game business and the 17173 revenues were $485 million, compared with revenues of $592 million in 2022. The full year operating profit was $203 million, compared with an operating profit of $282 million in 2022.
Quarterly operating profit was $47 million.
Compared with operating profit of $54 million in the same quarter last year.
For the full year 2023.
<unk> online game business and the one from <unk> III revenues.
<unk> hundred $85 million.
Compared with revenues of $592 million.
In 2022.
The full year operating profit was $203 million.
Compared with operating profit of $282 million in Kensington detour.
For the first quarter of 2024.
We expect.
Brand advertising revenues to be between $15 million.
$70 million.
This implies annual decrease of 25% to 33%.
Joanna: For the first quarter of 2024, we expect advertising revenues to be between $50 million and $70 million. This implies an annual decrease of 25% to 33% and a sequential decrease of 15% to 26%. All I gain revenues to be between $110 million and 120 million dollars. This implies an annual decrease of 7% to 15% and a sequential decrease of 4% and a sequential increase of 5%. The non-composite block attributable to Sohu.com Limited is expected to be between 23 million dollars and 33 million dollars, and the gap that's lost attributable to Sohu.com Limited is expected to be between 26 million dollars and 36 million dollars.
I'll ask two questions.
So 26%.
All I can revenues to be between $110 million.
$120 million.
This implies annual decrease of 7% to 15%.
And a sequential decrease of 4%.
The sequential increase.
Yes.
non-GAAP net loss attributable to Sohu Dot Com limited to.
To be between $23 million and $33 million.
And the GAAP net loss attributable to Sohu Com limited.
To be between $26 million.
$36 million.
This forecast reflects management's current and preliminary view.
Which is subject to substantial uncertainty.
This concludes our prepared remarks.
Operator.
I would now like to open the call to questions.
Thank you.
We will now begin the question and answer session, if you'd like to ask a question. Please press star one on your telephone.
Operator: This forecaster reflects management's current and preliminary view, which is subject to substantial uncertainty. This concludes our prepared remarks. Operator, we would now like to open the call to questions. Thank you.
I wish to cancel your request please press star.
One one that Ken.
One moment for the first question.
Yeah.
Our first question comes from the line of Thomas Chong of Jefferies. Please go ahead.
Operator: We will now begin the question and answer session. If you would like to ask a question, please press star 11 on your telephone. If you wish to cancel your request, please press star 11 again.
Hi, Good evening, Thanks management for taking my question.
I have two questions. My first question is about our thoughts.
About the impact of Mac will have been to the advertising market in China is going to fall and also brand advertising.
Thomas Chong: One moment for the first question. Our first question comes from the line of Thomas Chong of Jefferies. Please go ahead.
How is the trend so far across all.
<unk> Internet services and property sectors.
Chaoyang Zhang: Hi, good evening. Thanks, management, for taking my question. I have two questions. My first question is about our thoughts about the impact of macro headwinds on the advertising market in 2024 and for Sohu brand advertising. How's the trend so far across auto, FMCG, internet services, and property sectors? And my second question is about our capital allocation strategies. What makes us increase the authorized amount from $18 million to $115 million, as we have purchased only about $12 million as of the end of February?
And my second question is about our capital allocation strategy.
What made us increase the authorized amount.
<unk> 115 media as we purchased only about 12 million at the end of February. Thank you.
Okay.
Yeah.
So your first question is about the.
Having trend.
So the.
The macroeconomic situation not that good.
Hey will.
Trend trending down basically.
Our advertisers are being cautious in their budget.
So.
Our our exposure to real estate really small so the property market appropriate advertising is not a lot.
We'll continue to see continual percentage up.
Chaoyang Zhang: Thank you. So your first question is about the advertising trend. So the macroeconomic situation is not that good. So it will be trending down, basically, the... Advertisers are being cautious in their budgets. So Our exposure to real estate is really small, so the property market, property advertising is not a lot. We'll continue, we'll see, increase the percentage of advertisers. Industries are number one is auto and internet services, and FMCG is number three.
Advertiser industries are number one is the auto.
Our maintenance services and <unk> the three sectors.
But it's.
Yes, its trending down.
Sure.
Yes, we increased the <unk>.
Repurchase.
From 80 million to $150 million.
We've been.
We've been able to.
Purchased repurchased comment.
So far.
Due to daily volume there is limitation to daily volumes, that's why I will not be we would like to complete them. All you know.
But it takes some time because daily volume is really low.
Operator: But it's trending down. Yes, we increased the repurchase from $80 million to $150 million, but it's... We've been able to repurchase $1 million so far due to, you know, there's a limitation to daily volumes. That's why we would like to complete them all, you know, but it takes time because daily volume is really low. Yeah. Did I answer your question? Hello Thomas, your line is still
Yes.
And to your question.
So Thomas your line is still open.
Have any follow up questions. Please go ahead.
Yes. Thank you.
Thank you for the questions.
Once again, if you'd like to ask question. Please press star one.
Next question comes from Alicia Yap from Citigroup. Please go ahead.
Operator: If you have any follow-up questions, please ask ahead. Yes, thank you. Thank you for the questions.
Hi can you hear me, Okay, Hi management, Yes, yes, hi, Thank you Charles and good evening.
Alicia Yap: Once again, if you'd like to ask a question, please press star 11. The next question comes from Alicia Yap from Citigroup. Please go ahead.
Just a couple of questions for you Scott.
Your.
First quarter guidance I think the advertising came a little bit softer than you.
Alicia Yap: Hi, can you hear me okay? Hi, management. Yeah. Yeah. Hi, thank you, Charles. Good evening.
Our estimate can you elaborate a little bit the current macro environment that you have seen.
Chaoyang Zhang: I have a couple questions. First, on your first quarter guidance, I think the advertising came a little bit softer than our estimate. Can you elaborate a little bit on the current macro environment that you have seen and the advertiser budget sentiment? Is that trending weaker than you previously expected? Or is it in line with what you are expecting? And then do you expect the macro to turn better in the second half of this year? Or do you think the weak macro could last a little bit longer?
The advertiser sentiment is that been trending weaker than you previously expected or is it in line with what you are expecting and then do you expect the macro to turn back in the second half this year or do you think the weak macro could last a little bit longer and then.
Second question is on your loss guidance.
We are keeping some of the cost of revenue.
Chaoyang Zhang: And then second question is on your loss guidance. If we are keeping, you know, some of the cost of revenue, I mean, the cost of revenue for online advertising, does that suggest that the gross profit for online advertising in the first quarter could actually be negative? Just kind of a little bit of color, like how you guided so much wider on the loss.
I mean, the copper revenue for online advertising.
Does that suggest that the gross profit for online advertising in the first quarter could be actually Matt Curtis just pay off a little bit color on how you guys got so much wider on the loss.
And then lastly on the share buyback.
Chaoyang Zhang: And then lastly, on the share buyback, is there any reason the buyback pace during the quarter has been a little bit slow? Is that the limit on the daily trading volume? Or is it a predetermined price that prevents you from getting more aggressive?
Is there any reason to buy that pace during the quarter has been a little bit slow is that the limit on the daily trading volume or is it a pretty detailed mean price that prevent you from getting more aggressive. Thank you.
Chaoyang Zhang: Thank you. Yeah, I think the, Yeah, I think the advertising market, it seems, is trending even down faster than we expected, right? We can see that.
Yeah I think.
Yes.
The other pending market it seems.
Is trending.
Training, even down faster than we expected right, we can see that.
Chaoyang Zhang: And also, this year's Spring Festival, the Chinese New Year, is February 10th. It's a little later than last year, right? So people are, most of the Q1 people are on holidays, so many of the companies or our advertisers, they're just, you know, they start to plan for the year only after the Chinese New Year and after, you know, and Yuan Xiaojie after the 15th of the year. So that's why it's there. That's why.
Also this year's Spring festival, China's new kind of key areas.
February 10th.
In the late later than last year right.
So people are most of it.
Q1 <unk>.
Holidays, so many of the companies or the hour I don't Heather there just.
The start to plan.
For the year only after the after the Chinese new year and thereafter.
<unk>.
And Georgia.
With that I will.
15th of the year. So that's why that's why.
Chaoyang Zhang: We only started talking to these advertisers in the last few days because they all came back to work. And that's why Q1 is even slower this quarter compared with the Q1 of last year. Um, so. It seems I don't see any, you know, definitely the seasonality definitely will not be, no problem with Q2, right? There is no seasonality issue since Q2 is normally a strong quarter for advertising, but the microeconomy situation is not, it seems not improving in the near future, right, so we'll expect not much improvement. But definitely, it will be better than Q1 of seasonality. And also, I hope to do it better because we have some also some to continue to be effective and innovative. Marketing Campaigns That...
And we only started.
Talking to these advertisers last few days because they all came back to work in that's why Q1 is even slower.
Quarter compare with.
The Q1 of last year.
So.
It seems I don't.
Definitely.
The seasonality is definitely we're not there is no problem with Q2 right. There is no seasonality issues in Q2 is normally.
There is a strong quarter for advertising, but.
But the Macroeconomy institution is not in it seems not improving.
In the near future so.
Correct.
Not much improvement.
That definitely will be better than Q1.
Seasonality.
And also I hope to do it better.
Because we.
We have some also some continue our effective and innovative.
Marketing campaigns that bring in France.
Great.
Chaoyang Zhang: Cost of revenue or gross profit widening because our current Goal, or our ambition, is really to have strong products and attrition of, basically, to develop a large user base. And with the cash we have, we're still fighting. We're not retreating, or we're still fighting.
Yes.
Cost of revenue, our gross profit widening because.
Our current.
Go or our ambition is really to have strong products and attrition of basically to develop large user base.
And with the cash we have.
We are still fighting we're not we're not retreating or we're still finding we need to.
Chaoyang Zhang: We need to develop user bases so that in the coming years, months, or years, we're spending more on marketing and on building our products and the video social network, and live streaming, you know, user-generated products. So, that explains why we have forecast a wider loss for Q2.
<unk> user basis, so that.
No.
<unk>.
Yes.
Amongst all year.
We're spending more on marketing.
Building our products.
The video.
Actual network.
Live streaming.
User generated content UGC products.
So.
That's that.
<unk>.
Forecast a wider loss for Q2.
Sure.
Share repurchase pace is.
Purely due to the daily volume limitation.
Chaoyang Zhang: It's not a price... We don't have a price target, no, we don't have a tight price target. Okay, thank you, Charles. Yeah, thank you, Chao. Thank you for the question. Once again, to ask a question, please press star 11. There are no further questions at this time. I'd like to conclude the call. Thank you for participating in today's conference call. You may now disconnect your line
It's not a.
Price.
The prize target no we don't have a.
A tight price target.
To limit purchase.
Yeah.
Sure.
Okay. Thank you Charles.
Okay, Yeah. Thank you Charles.
Thank you for the question.
Once again to ask a question please press star one.
There are no further question at this time I would like to conclude the call. Thank you for participating to the conference call. You may now disconnect your lines.
Thank you.
Sure.
Operator: For more UN videos, visit www.un.org and www.equitiemusic.com
Okay.
[music].
Okay.
Yes.
[music].