Q2 2025 Weibo Corp Earnings Call

Sandra Zhang: Good day, and thank you for standing by. Welcome to Weibo Corporation's second quarter 2025 financial results. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you need to press star one and one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one and one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to our speaker today, Sandra Zhang of Investor Relations. Please go ahead. We have a technical team on the line. Please remain on the line. Your conference will resume shortly. Thank you. Please remain on the line. Your conference will resume shortly. Thank you. We are now back. Our conference can resume.

Speaker #2: Good day, and thank you for standing by. Welcome to Weibo Corp Q4 2025 financial results. At this time, all participants are in a listen-only mode.

Speaker #2: After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you need to press *1 and 1 on your telephone.

Speaker #2: You will then hear an automated message advising your hand is raised. To withdraw your question, please press star, one, and one again. Please be advised that today's conference is being recorded.

Speaker #2: I would now like to hand the conference over to your speaker today, Sandra, of Investor Relations. Please go ahead. We have a technical team on the line.

Speaker #2: Please remain on the line. Your conference will resume shortly. Thank you. Please remain on the line. Your conference will resume shortly. Thank you. We are now back.

Speaker #2: Our conference can resume. I would now like to hand the conference over to your first speaker today, Sandra Zhang, of Investor Relations. Please go ahead.

Sandra Zhang: I would now like to hand the conference over to our first speaker today, Sandra Zhang of Investor Relations. Please go ahead.

Sandra Zhang: Thank you all, Peter. Welcome to Weibo's second quarter of 2025 earnings conference call. Joining me today are our Chief Executive Officer, Gaofei Wang, and our Chief Financial Officer, Fei Cao. The conference call is also being broadcast today on the internet and is available through Weibo's IR website. Before the management remarks, I would like to read you the three public statements in connection with today's conference call. During today's conference call, we may make forward-looking statements. Statements that deny historical facts, including statements of our beliefs and expectations. Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Weibo assumes no obligation to update the forward-looking statement in this conference call and elsewhere.

Speaker #3: Thank you, operator. Welcome to Weibo Q4 2025 earnings conference call. Joining me today are our Chief Executive Officer, Gaofei Wang, and our Chief Financial Officer, Fei Cao.

Speaker #3: The conference call is also being broadcast on the internet and is available through Weibo's I/O website. Before the management remarks, I would like to read Fei Cao's statement in connection with today's conference call.

Speaker #3: During today's conference call, we may make forward-looking statements. These statements are not historical facts. Including statements of our beliefs and expectations, forward-looking statements involve inherent risks and uncertainties.

Speaker #3: A number of important factors could cause actual results to differ from those containing any forward-looking statements. Weibo assumes no obligation to update the forward-looking statements in this conference call and elsewhere.

Sandra Zhang: Further information regarding this and other risks is included in Weibo's annual report on Form 20F and other filings with the SEC. All the information provided in this press release is occurring as stated hereof. Weibo assumes no obligation to update such information except as required under the 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 Weibo's comparative operating performance and the future prospects. Our non-GAAP financials exclude certain expenses, gains or losses, and other items that are not expected to result in future cash payments or are 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.

Speaker #3: Further information regarding this and other risks is included in Weibo's annual report on Q2 2025 and other filings with the SEC. All the information provided in this press release is occurring as the data heralds.

Speaker #3: Weibo assumes no obligation to update such information. Except as required under the 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.

Speaker #3: We use non-GAAP financial measures to gain a better understanding of Weibo's comparative operating performance and the future prospects. Our non-GAAP financials exclude certain expenses, gains or losses, and other items that are not expected regarding future cash payments, or are not recurring in nature, or are not indicative of our core operating results and outlook.

Speaker #3: Please refer to our press release for more information about the non-GAAP measures. Following management's prepared remarks, we will open the lines for a brief Q&A session.

Sandra Zhang: Following management's prepared remarks, we open the line to a brief Q&A session. With this, I would like to turn the call over to our CEO, Gaofei Wang.

Speaker #3: With this, I would like to turn the call over to our CEO, Gaofei Wang.

Gaofei Wang: 谢谢, 大家好, 欢迎大家参加微博财报电话会议。

Speaker #4: 谢谢大家好, 欢迎大家参加微博财报电话会议。

Sandra Zhang: Thank you. Hello everyone, welcome to Weibo's second quarter of 2025 earnings conference call.

Speaker #3: Thank you. Hello, everyone. Welcome to Weibo Q4 2025 earnings conference call.

Gaofei Wang: 本次财报会我向大家重点介绍微博二五年第二季度的产品运营以及商业化方面的进展。

Speaker #4: 本次财报会, 我向大家重点介绍微博25年第二季度的产品运营以及商业化方面的进展。

Sandra Zhang: On today's call, I will share with you the highlights on Weibo's product and monetization in the second quarter of 2025.

Speaker #3: On today's call, I will share highlights on Weibo's product and monetization in the second quarter of 2025.

Gaofei Wang: Q2 Weibo non-GAAP operating income为$161.8 million, non-GAAP operating income率为36%.

Speaker #4: 用户方面, 截至二季度末, 我们的月活跃用户达到5.88亿, 日活跃用户达到2.6亿。二季度, 微博总营收达到4.48亿美金, 年对年增长2%。其中广告营收达到3.84亿、3.834亿美金, 年对年增长2%。二季度, 微博调整后营业利润为1.618亿美金, 调整后营业利润率为36%。

Sandra Zhang: On the user front, in June 2025, Weibo's MAUs reached 588 million, and average DAUs reached 261 million. In the second quarter, Weibo's total revenues reached $444.8 million, up 2% year over year. Our total ad revenues reached $383.4 million, up 2% year over year. Our non-GAAP operating income reached $161.8 million, representing a non-GAAP operating margin of 36%.

Speaker #3: On the user front, in June 2025, Weibo's MAUs reached 588 million, and average DAUs reached 261 million. In the second quarter, Weibo's total revenues reached $444.8 million, up 2% year over year.

Speaker #3: Our total ad revenues reached $303.4 million, up 2% year over year. Our non-GAAP operating income reached $161.8 million, representing a non-GAAP operating margin of 36%.

Gaofei Wang: user growth, content ecosystem competitiveness, and commercialization growth.

Speaker #4: 二五年, 微博自公司整体策略仍以用户价值为核心, 保持微博在热点和文娱内容的生态领先优势。稳定的社交产品的竞争力, 并在此基础上结合大模型的能力, 重点投入加强, 推荐搜索体系的建设, 实现用户活跃和规模的增长。接下来, 我们将从用户增长、内容生态竞争力、商业化增长三个维度, 阐述微博二五年二季度产品运营以及商业化工作的进展。

Sandra Zhang: In 2025, the company's overall strategy focuses on the value of users, sustaining the leading position in trending topics and entertainment sectors, and solidifying the competitive edge of the social product. On top of that, we prioritize enhancing the recommendation and search functions by integrating large language models to drive user skill and engagement. Next, let me share with you our progress made in the second quarter of 2025 from three dimensions: user growth, the competitiveness of the funding ecosystem, and monetization.

Speaker #3: In 2025, the company's overall strategy focuses on the value of users, sustaining the leading position in trending topics and entertainment sectors, and solidifying the competitive edge of the social products.

Speaker #3: On top of that, we prioritize enhancing the recommendation and search functions by integrating large language models to drive user skill and engagement. Next, let me share with you our progress made in the second quarter of 2025 from three dimensions.

Speaker #3: User growth, the competitiveness of the company ecosystem, and monetization.

Gaofei Wang: 从用户增长和活跃方面，二五年用户产品和技术聚焦在社交产品的整合和推荐体系的升级，旨在促进用户活跃和规模的提升。微博发展15年间，首页信息流产品一直围绕提升用户内容消费效率和社交效率这两个目标进行平衡和跨产生型，历经了从纯时间线向智能推荐引擎的逐步演进。最早的首页信息流是在发布时间排序的进行组织开发，但随着用户的内容生产更为便捷，内容爆炸式的生产规模远大于消费规模。我们在2016年对首页信息流进行了算法升级，改变了时间排序方式，重点对关注人的未读信息进行再组织。后续在2018年又上线了关系流和推荐流双流的产品结构，目的都是为了扩大用户的内容消费广度，提升用户的内容消费规模。

Speaker #4: 从用户增长和活跃方面, 二五年用户产品和技术聚焦在社交产品的整合和推荐体系的升级。旨在促进用户活跃和规模的提升。微博发展十五年间, 首页信息和产品意义的围绕提升用户内容消费效率和社交效率, 这两个目标进行平衡和扩大升级。历经了从纯时间线向智能推荐引擎的逐步演进, 最早的首页信息流受到发布时间、排序的进行组织分发。但随着用户的内容生产更为便捷, 内容爆炸式的生产规模远大于消费规模。我们在一六年对首页信息流进行了算法升级, 改变了时间排序方式, 重点对关存的未读信息进行再组织, 后续在一八年又上线了关系流和推荐流双流的产品结构, 目的都是为了扩大用户的内容消费广度, 提升用户的内容消费规模。

Sandra Zhang: On user growth and engagement, we focused on the integration of social products and upgrades of our recommendation system this year, aiming to drive user engagement and user growth. Over Weibo's 15 years of development, the homepage information feeds have continuously evolved to achieve two core objectives: to enhance the efficiency of content consumption and social interaction by users. Accordingly, the content recommendation mechanism of information feeds has evolved from a timeline-based distribution to a recommendation-based distribution. To be specific, the information feeds were originally distributed in reverse chronological order based on the posting time. As content creation became more convenient for users, the explosive amount of content produced largely exceeded the amount of content consumed. Therefore, to improve content consumption efficiency, we upgraded the algorithm of information feeds from purely timeline-based to focusing on distributing unread posts from individual accounts being followed by users in 2016.

Speaker #3: On user growth and engagement, we focus on the integration of the social product and the upgrade of our recommendation system this year, aiming to drive user engagement and user growth.

Speaker #3: Over Weibo's fifteen years of development, the homepage information feeds have continuously evolved to achieve two core objectives: to enhance the efficiency of content consumption and social interaction by users.

Speaker #3: And accordingly, the content recommendation mechanism of information feeds has evolved from a timeline-based distribution to a recommendation-based distribution. To be specific, the information feeds were originally distributed in reverse chronological order based on the posting time, as content creation became more convenient for users.

Speaker #3: The explosive amount of content produced largely exceeded the amount of content consumed. Therefore, to improve content consumption efficiency, we upgraded the algorithm of information feeds from purely timeline-based to focusing on distributing unread posts from individual accounts being followed by users in 2016.

Sandra Zhang: Later in 2018, we introduced a dual-feed product structure, composing of a relationship-based feed and an interest-based feed, aiming to broaden users' content discovery and increase their content consumption scale.

Speaker #3: Later in 2018, we introduced a new feed product structure, composed of a relationship-based feed and an interest-based feed, aiming to broaden users' content discovery and increase their content consumption scale.

Gaofei Wang: the quality of recommended content and enhance user consumption experience of recommended content.

Speaker #4: 在随着用户消费内容以及被推荐的习惯改变, 我们在今年上半年对首页信息流产品进行策略升级改版。新版本首页以推荐流作为用户打开微博后的默认首页, 实现了以推荐流为主的产品结构。推荐的分发机制也进行了增大调整。一方面, 融合了原有关系流的社交内容与原有推荐流基于信息内容的推荐机制。另一方面, 重点加强了用户在推荐流的消费互动的推荐反馈, 满足用户当下的深度消费需求。整体来说, 新推荐流在保存用户对原有社交内容消费的基础之上, 进一步提升了用户在推荐流发现兴趣内容的快速匹配和深度消费的体验。并且结合大模型的能力, 提升推荐的内容质量, 提升用户对推荐内容的消费体验。

Sandra Zhang: In recent years, users' content consumption behaviors have been altered by the recommended content. To adapt to this trend, we initiated a strategic revamp of our homepage information feeds in the first half of this year, which makes the interest-based feed as a primary interface when users access Weibo. We also made significant adjustments on the distribution mechanism of the interest-based feeds. On the one hand, we integrated the recommendation mechanism for both relationship-based feeds and interest-based feeds. On the other hand, we enhanced the user feedback mechanism based on users' interaction and consumption behaviors in the interest-based feed, aiming to meet their in-depth consumption demands. Overall speaking, while preserving users' fundamental need for social content consumption, the upgraded interest-based feed delivered improved efficiency of discovering interest-based content and deepened user engagement.

Speaker #3: In recent years, users' content consumption behaviors have been altered by the recommended content. To adapt to this trend, we initiated a strategic revamp of our homepage information feed in the first half of this year, which makes the interest-based feed the primary interface when users access Weibo.

Speaker #3: We also made significant adjustments to the distribution mechanism of the interest-based feed. On the one hand, we integrated the recommendation mechanism for both the relationship-based feed and the interest-based feed.

Speaker #3: On the other hand, we enhanced the user feedback mechanism based on users' interaction and the consumption behaviors in the interest-based feed. Aiming to meet their in-depth consumption demands.

Speaker #3: Overall speaking, while preserving users' fundamental need for social content consumption, the upgraded interest-based feed delivers improved efficiency in discovering interest-based content and deepens user engagement.

Sandra Zhang: Additionally, by leveraging large language models, we have enhanced the quality of recommended content, improving users' overall consumption experience.

Speaker #3: Additionally, by leveraging large language models, we have enhanced the quality of recommended content, improving users' overall consumption experience.

Gaofei Wang: 我们希望这次手动信息改版、信息流改版可以进一步释放微博优质内容的储备价值, 借助算法的能力提高用户的消费深度和使用粘性, 强化垂直内容的生态竞争力。7月初, 我们顺利完成了产品和技术框架的升级工作, 并以基本覆盖的渠道优势。目前在首页信息流人均消费阅读量保持稳定的基准上, 用户消费推荐内容的比例已经提升43%, 相比之前提升了17个百分点。这对后续效率优化和平台内容生态打下了较好的基础。

Speaker #4: 我们希望这次首页信息改版信息流改版, 可以进一步释放微博优质内容的储备价值, 借助算法的能力提高用户的消费深度和使用粘性。强化推特内容生态竞争力, 确保我们顺利完成了产品和技术框架的升级工作, 并以技术覆盖的权当优势, 目前在首页信息流人均消费阅读量保持稳定的基础之上, 用户消费推荐内容的比例已经提升43%。相比之前提升了17个百分点, 这对后续效率优化和平台内容生态打下了较好的基础。

Sandra Zhang: We hope the upgrade of the homepage information feed will further unlock Weibo's value in delivering quality content. We aim to enhance users' consumption depth and engagement through algorithm capability, which will strengthen the competitiveness of our vertical content ecosystem. In early July, we completed the upgrade of product and technical frameworks, which has rolled out to nearly all users. Currently, with the average content views of the homepage information feed per user remaining stable, the proportion of the recommended content consumed by users has increased to 43%, representing a 17% improvement over the previous level. This established a solid foundation for efficiency improvement and the development of the platform's content ecosystem.

Speaker #3: We hope the upgrade of the homepage information feed will further unlock Weibo's value in delivering quality content. We aim to enhance users' consumption depth and engagement through algorithm capability.

Speaker #3: We will strengthen the competitiveness of our vertical content ecosystem. In early July, we completed the upgrade of our product and technical frameworks, which has rolled out to nearly all users.

Speaker #3: Currently, with the average content views of the homepage information feed per user remaining stable, the proportion of the recommended content consumed by users has increased to 43%.

Speaker #3: Representing a 17% improvement over the previous level, this established a solid foundation for efficiency improvement and the development of the platform's content ecosystem.

Gaofei Wang: 随着首页信息流产品的升级, 平台流量策略会从关注关系分发拓展到兴趣分发, 来增强平台的内容竞争力。社交产品沿着平台多年积累的社交关系以及兴趣社区来强化平台的社交属性, 提升用户在平台分享和互动的积极性。二季度, 我们进一步加强了用户在核心产品场景的社交互动体验, 取得比较明显的进展。例如, 用户反馈问题较多的评论区的低质内容, 我们重点针对明星和头部博主的评论区, 加强低质内容的识别和治理, 有效地改善了讨论质量, 提升了用户评论区访问和评论意愿。针对明星超话, 我们重视用户真实交流、分享和社交需求, 重点提升了明星超话的多样性、实时性的社交氛围体验, 恢复明星超话的社交感。明星超话二季度发帖人数、互动人数和阅读人数同比实现了明显的增长。

Speaker #4: 随着首页信息流产品升级, 平台流量策略会逐关系分发拓展到信息分发。来增强平台的内容竞争力。社交产品的沿着平台多年积累的社交关系以及信息社区来强化平台的社交属性, 提升用户在平台分享和互动的积极性。二季度, 我们进一步加强了用户在核心产品场景的社交互动体验, 取得比较明显的进展。例如, 用户反馈问题较多的评论区的低质内容, 我们重点针对明星和同步博主的评论区, 加强低质内容的识别和治理, 有效地改善了讨论质量, 提升了用户评论区访问和评论意愿。针对明星策划, 我们重视用户真实交流、分享和社交需求, 重点提升了明星策划者的多样性, 事实性的社交氛围体验。恢复明星策划的社交感, 明星策划二季度的发帖人数、互动人数和阅读人数同比实现了明显的增长。

Sandra Zhang: With the upgrade of the homepage information feed product, our platform's content distribution strategy will expand from relationship-based distribution to interest-based distribution, aiming to enhance content competitiveness. For social products, leveraging the platform's long accumulated social assets and interest-based communities, we reinforce the platform's social attributes and boost the user's willingness to share and interact. In the second quarter, we further strengthened users' social interaction experience in the core product scenario, achieving notable progress. For example, to address the prevalent issue of low-quality content in comment retention, particularly comments entered posts by celebrities and top KOLs, we enhanced the identification and monitoring of low-quality content. This effectively improved discussion quality and increased users' willingness to visit and engage in a commentary session.

Speaker #3: With the upgrade of the homepage information feed product, our platform's content distribution strategy will shift from relationship-based distribution to interest-based distribution, aiming to enhance content competitiveness.

Speaker #3: For social products, leveraging the platform's long-accumulated social assets and the interest-based communities, we reinforce the platform's social attributes and boost user willingness to share and interact.

Speaker #3: In the second quarter, we further strengthened users' social interaction experience in the core product scenarios, achieving notable progress. For example, to address the prevalent issue of low-quality content in comment retention, particularly comments and/or posts by celebrities and top KOLs, we enhanced the identification and monitoring of low-quality content.

Speaker #3: This effectively improved discussion quality and increased users' willingness to visit and engage in the commentary session. For the celebrity-related super topics, we prioritize users' genuine communication, content sharing, and consumption needs, and focus on improving the diversity of content and real-time attributes of the community.

Sandra Zhang: For the celebrity-related super topics, we prioritized users' general communication, content sharing, and consumption needs, and focused on improving the diversity of content and real-time attributes of the community. These efforts helped improve social connection in the celebrity-related super topics, driving notable year-over-year growth of users who posted, engaged, and consumed content in the second quarter.

Speaker #3: These efforts help improve social connection in the celebrity-related super topics, driving notable year-over-year growth of users who posted, engaged, and consumed content in the second quarter.

Gaofei Wang: 从强化内容生态性能力方面, 未来推荐流会成为我们主要的内容开发场景。我们的垂直运营体系在二季度也完成了以博主账号到新的内容运营的建立, 顺利跑通了基于兴趣内容消费的需求, 调动跨领域博主生产的运营机制。目前优势的兴趣内容超过50%以上的生产来自于跨领域博主生产, 这也得益于 Weibo 多年来垂直领域的深耕和垂直运营体系的优势所在。二季度推荐流的垂直消费占比达到60%。同时, 新推荐流优化的内容质量将更多的流量分配给优质真人内容, KOL和明星的流量账号也得到增长, 也给了中小中小费内容创作者更多的成长空间。下半年, 我们将进一步聚焦基于内容流提升用户活跃的目标, 产品运营驱动优质内容的供给保障, 技术驱动更精准、更信誉优格的内容匹配, 提升用户信息获取的效率和满足感, 从而带动更多的内容阅读、更频繁的用户访问。在稳固 Weibo 在文娱热点内容生态优势的基础上, 助力垂直生态的长期发展, 达成用户爱看、创作人成长、平台共赢的结果。

Speaker #4: 从采访内容生态竞争力方面, 未来推荐流会从而为您主要的内容分发场景。我们的垂直运营体系在二季度也完成以博主账号到信息内容运营的建立。顺利跑通了基于信息内容消费的需求。调动跨领域博主生产的运营机制, 目前优势的信息内容超过50%以上的生产来自于跨领域博主生产。这也得益于微博多年来垂直领域的深耕和垂直运营体系的优势所在。二季度, 推荐流的垂直消费占比达到60%。同时, 新推荐流优化内容质量, 将更多的流量分配给优质真人内容。QR和明星的流量账号也得到增长, 也给了中小费的内容创作者更多的成长空间。下半年, 我们将进一步聚焦基于内容流提升用户活跃的目标。产品运营驱动优质内容的供给保障, 技术驱动更精准、更信任用户的内容匹配, 提升用户信心获取的效率和满足感。从而带动更多的内容阅读、更频繁的用户访问。在稳固微博在文娱热点内容生态优势的基础上, 助力垂直生态的长期发展, 达成用户爱看、创作者成长、平台共赢的结果。

Sandra Zhang: To enhance the competitiveness of the content ecosystem, our interest-based feed will become the primary feed for content distribution. In the second quarter, on the vertical content ecosystem, we completed the transition of content operation from an influencer-based model to a vertical content-based model, which attracted content creators from cross-verticals to generate content on a specific vertical area. Currently, over 50% of the interest-based content from key verticals are generated from cross-vertical KOLs, which benefit from our years of deep cultivation in vertical areas and the advantages of our vertical content operation. In the second quarter, vertical content consumption accounted for 60% of the interest-based feed consumption. Meanwhile, the new interest-based feed optimized content quality by allocating more traffic to high-quality authentic content. This had increased the traffic share for KOLs and celebrity accounts, while also providing more growth opportunities for mid-tier and long-tail KOLs.

Speaker #3: To enhance the competitiveness of the content ecosystem, our interest-based feed will become the primary feed for content distribution. In the second quarter, on the vertical content ecosystem, we completed the transition of content operation from an influencer-based model to a vertical content-based model, which attracted content creators from cross verticals to generate content on specific vertical areas.

Speaker #3: Currently, over 50% of the interest-based content from key verticals are generated from cross vertical KOLs, which benefit from our years of deep cultivation in vertical areas, and advantages of our vertical content operation.

Speaker #3: In the second quarter, vertical content consumption accounted for 60% of the interest-based feed consumption. And meanwhile, the new interest-based feed optimized content quality by allocating more traffic to high-quality authentic content.

Speaker #3: This has increased the traffic share for KOLs and celebrity accounts, while also providing more growth opportunities for mid-tier and long-tail KOLs. In the second half of this year, with the goal of enhancing user engagement through the interest-based feed, we will increase the supply of quality content to users through product operation and recommend more precise and engaging content to users.

Sandra Zhang: In the second half of this year, with the goal of enhancing user engagement through the interest-based feed, we will increase the supply of quality content to users through product offerings and recommend more precise, engaging content to users through recommendation. This will improve the efficiency for users to access effective content and their satisfaction of content consumption, and thereby further drive up content consumption and more frequent usage. While solidifying Weibo's advantages in entertainment verticals and trending topics, we look forward to the long-term development of the vertical content ecosystem to achieve a win-win situation where users enjoy quality content, creators develop, and the platform thrives.

Speaker #3: Through recommendation, this will improve the efficiency for users to access effective content and their satisfaction with content consumption. This, in turn, will further drive up content consumption and lead to more frequent usage.

Speaker #3: While solidifying Weibo's advantages in entertainment verticals and trending topics, we'll support the long-term development of a vertical content ecosystem to achieve a win-win situation where users enjoy quality content, creators develop, and the platform thrives.

Gaofei Wang: 接下来, 我再介绍一下自收的产品一展。二季度通过优化模型策略, 融入数据内容, 增加多模态内容的呈现, 提升自动效果。同时, 平台促进博主生产更多内容, 填补观点, 用于自收结果的优化。自收产品在二季度继续快速发展。6月自收的月活用户突破5,000万, 自收产品显著提升了用户在自收下的消费体验以及在主动搜索产品开发的搜索满足率。二季度自收月活用户数较一季度大幅增长, 也进一步促进了搜索进入开源量的环比增长。从更长期来看, 基于大模型的总结和归纳能力, 我们相信 Weibo 平台上沉淀了十多年的优质内容和观点, 能够在综合搜索结果呈现上得到更加充分的体现, 也能明显提升搜索结果的有效性和消费效率, 让 Weibo 搜索从实时加热度搜索更好地满足用户长尾搜索需求, 提升平台搜索产品的竞争力。

Speaker #4: 接下来, 我再介绍一下自搜的产品进展。二季度, 通过优化模型策略, 用户数据内容增加多模态内容的呈现, 提升自搜效果。同时, 平台促进博主生产更多内容, 填补关键用于自搜技术的优化。自搜产品在二季度继续快速发展。六月, 自搜的月活跃用户突破五千万, 自搜产品显著提升了用户在自搜下的消费体验, 以及在主动搜索产品下的搜索满足率。二季度, 自搜月活跃用户数较一季度大幅增长, 也进一步促进了搜索的进入客人量的环比增长。从更长期来看, 基于大模型的总结和归纳能力, 我们相信微博平台上沉浸了十多年的优质内容和观点, 能够在综合搜索结果呈现上得到更加充分的体现。也能明显提升搜索结果的有效性和消费效率, 让微博搜索从实时加热度搜索更好地满足用户长尾搜索需求, 提升平台搜索产品的竞争力。

Sandra Zhang: Next, let me share with you the updates of Weibo's intelligent search product. In the second quarter, we beefed up our efforts to transform the AI-powered search experience through optimization in model strategies, enrichment of database, and integration of multimodal content. Additionally, we incentivized the content creators to produce more high-quality content and perspectives, which further refined the quality of search results. As a result, Weibo's intelligent search saw robust growth during this quarter, with MAUs surpassing 50 million in June. Notably, Weibo's intelligent search has significantly enhanced the user experience for trending topics, as well as better fulfilled user queries in on-demand search scenarios. Daily active users of intelligent search also increased notably quarter over quarter, driving solid growth in average daily search queries.

Speaker #3: Next, let me share with you the updates of the Weibo Intelligence Search product. In the second quarter, we beefed up our efforts to transform the AI-powered search experience through optimization in model strategies.

Speaker #3: Enrichment of the database and integration of multimodal content. Additionally, we incentivized the content creators to produce more high-quality content and perspectives, which further refined the quality of search results.

Speaker #3: As a result, Weibo's Intelligence Search saw robust growth during this quarter, with MAUs surpassing 50 million in June. Notably, Weibo's Intelligence Search has significantly enhanced the user experience for trending topics and better fulfilled user queries in on-demand search scenarios.

Speaker #3: Daily active users of Intelligence Search also increased notably quarter over quarter, driving solid growth in average daily search queries. In the longer run, powered by the large language models' summarization capabilities, we believe that the high-quality content and diverse viewpoints accumulated on Weibo over a decade will be presented in a more thorough way.

Sandra Zhang: In the longer run, powered by the large language model summarization capabilities, we believe that the high-quality content and diverse viewpoints accumulated on Weibo over a decade will be presented in a more thorough way. This will not only improve results relevancy and content consumption efficiency, but also enable Weibo's intelligent search to go beyond trending on real-time topics to better address long-tail search needs. We are encouraged to see an AI-driven roadmap to strengthen our competitive edge in the search market.

Speaker #3: This will not only improve results relevancy and content consumption efficiency, but also enable Weibo Intelligence Search to go beyond trending and real-time topics to better address long-tail search needs.

Speaker #3: We are encouraged to see an AI-driven roadmap to strengthen our competitive edge in the search market.

Gaofei Wang: 将更多的行业以及客户基地渗透和巩固, 并不断提升广告产品的销售转化能力。从整体市场看, 在扩大内需促进消费政策的引导下, e-commerce 平台以及相关行业在这个季度的投入预测加大。本季度营销工作的重点为以持续整合 Weibo 特有的热点、明星、头部 KOL 的内容优势, 在扩大客户市场覆盖的同时聚焦客户新品营销市场, 强化 Weibo 作为新品营销主阵地的客户心智。第二, 保持在效果广告产品持续的投入, 提升效果广告预算的布局能力, 并在今年的收入持续得到正向反馈。

Speaker #4: 从商业化增长方面, 二五年广告产品、QR团队聚焦在微博的内容营销的性质, 将更多的行业及客户机制渗透和巩固。并不断提升广告产品的销售转化能力。从整体市场看, 在扩大内需促进消费增长的引导下, 电商平台以及相关行业在这个季度的投入预测加大。本季度, 营销工作的重点为以持续整合微博特有的热点、明星、同步KOL的内容优势, 再扩大客户市场覆盖的同时, 聚焦客户新品营销市场, 强化微博作为新品营销主阵地的客户心智。第二, 保持在效果广告产品持续的投入, 提升效果广告预算的固定能力, 并在今年的收入持续得到正向反馈。

Sandra Zhang: Moving on to monetization, in 2025, our ad product and sales strategy focused on expanding and solidifying customers' lifestyles of choosing Weibo as their go-to platform for content marketing across industries, as well as enhancing ad product conversion capabilities. From the demand side, best-buy consumption stimulus policies, e-commerce platforms, and related sectors increased their ad spend during the quarter. We focused on two aspects in our sales execution this quarter. First, we continued to leverage Weibo's unique strength in trending topics, celebrity resources, and top KOL content to broaden our industry reach, while focusing on new product launch marketing to further reinforce Weibo's position as the go-to platform for clients. Second, we maintained our investment in performance-based ad products, which enhanced our capabilities to capture incremental ad budgets and continue to deliver positive revenue outcomes.

Speaker #3: Moving on to monetization, in 2025, our ad product and sales strategy focuses on expanding and solidifying customers' mindset of choosing Weibo as the go-to platform for content marketing across industries, as well as enhancing ad product conversion capabilities.

Speaker #3: From the demand side, back-to-buy consumption stimulus policies, e-commerce platforms, and related sectors increase their ad spend during the quarter. We focus on two aspects in our sales execution this quarter.

Speaker #3: First, we continue to leverage Weibo's unique strengths in trending topics, celebrity resources, and top KOL content to broaden our industry reach. While focusing on new product launch marketing to further reinforce Weibo's position as the go-to platform for clients.

Speaker #3: Second, we maintained our investment in performance-based ad products, which enhance our capability to capture incremental ad budgets and continue to deliver positive revenue outcomes.

Gaofei Wang: 生产行业来看, 主要得益于与各大电商平台在618节点深度合作, 电商行业收入同比有明显的增加, 所以拉动内需非常重要的营销场景。电商品牌包括本地生活服务的相关行业在今年的投入有所增加。新闻行业, Weibo作为新能源车的内容讨论主阵地, 依然保持着行业生态优势。基于这种优势生态, 各厂商都普遍增加了对Weibo的营销预算投入。上半年新能源新车上市的营销覆盖超过60%。

Speaker #4: 分行业来看, 主要得益于各大电商平台在618季的深度合作。电商行业收入同比有明显的增加, 作为拉动内需非常重要的一项场景。电商品牌包括本地生活服务的相关行业在今年的投入有所增加。其他行业, 微博作为新能源车的内容讨论的主阵地, 依然保持着行业生态优势。基于这种优势生态, 各厂商都普遍增加了对微博的营销预算投入。上半年, 新能源新车上市的营销覆盖超过60%。

Sandra Zhang: By industry, e-commerce platforms showed a solid year-over-year revenue growth in the second quarter, benefiting from close partnerships with major platforms during the June 18th Shopping Festival. As a pivotal arena for boosting domestic consumption, e-commerce and related categories, such as local service, are expected to further ramp up marketing efforts with Weibo this year. As for the automobile vertical, Weibo continues to be the key discussion hub for new energy vehicles, sustaining its ecosystem advantages. Major OEMs have increased their budget allocation to Weibo, with marketing coverage for new EV model launches exceeding 50% in the first half of this year.

Speaker #3: By industry, the e-commerce platform posted solid year-over-year revenue growth in the second quarter, benefiting from close partnerships with major platforms during the June 18 shopping festival.

Speaker #3: As a pivotal arena for boosting domestic consumption, e-commerce and related categories such as local service are expected to further ramp up marketing efforts with Weibo this year.

Speaker #3: As for the automobile vertical, Weibo continues to be the key discussion hub for new energy vehicles, sustaining its ecosystem advantages. Major OEMs have increased their budget allocation to Weibo, with marketing coverage for new EV models launching exceeding 60% in the first half of this year.

Gaofei Wang: marketing content chain, thereby effectively promoting customer marketing content and establishing user mindshare for customers, improving marketing conversion.

Speaker #4: 在消费品行业, 包括食品饮料和鞋服, 美妆客户等领域, 我们看到整体客户市场正在发生变化。随着持续性的电商效果的投入和竞争, 客户在这方面的投入边际效应明显递减。越来越多的客户在考虑重新进行品重新考虑品牌建设。比如, 我们看到过往的预算全部转移到电商效果或者QQC中小的客户, 今年开始重点考虑将预算投入到民营代言或者内容IP的制作和冠名上。客户在这方面的变化是逐步且谨慎, 但我们看到这个趋势有望持续。今年上半年, 消品行业客户对微博的新品、民营代言和IP营销的关注度大幅提升。新品和明星的官宣核心场景的收入和项目数同比居双位数增长。上星微博的合作粘性加强, 明星价值的呈现回归趋势。与此同时, 我们将细分消费品行业客户营销需求, 加强广告产品建设, 将明星以头部内容创造者和客户的营销内容以博文和热点这些微博特有优势内容结合起来, 通过微博内容加热和内容聚合的广告产品将营销内容链路打通, 从而有效推动客户营销内容变为客户建立用户心智, 提升营销转化。

Sandra Zhang: In the FMCG category, including food and beverage, footwear and apparel, and personal care and beauty sectors, we are seeing shifts in client marketing strategies. After years of heavy investment in e-commerce performance and key KOC seeding, more and more advertisers now face diminishing returns, which prompt a reconsideration of budgeting. For instance, certain advertisers who had previously shifted most of their budget to performance-based marketing or influencer seeding are now reallocating budget towards celebrity endorsement, content IP creation, and sponsorship. While the transition is gradual and measured, we believe this trend is likely to continue. In the first half of 2025, advertisers from the FMCG category became increasingly interested in Weibo's product launch, celebrity, and IP marketing offerings. As a result, both the number of campaigns and the revenue generated from product launch and celebrity official announcement campaigns built double-digit year-over-year growth.

Speaker #3: In the SMCG category, including food and beverage, footwear and apparel, and personal care and beauty sectors, we are seeing shifts in clients' marketing strategies.

Speaker #3: After years of heavy investment in e-commerce performance and QQC seeding, more and more advertisers now face diminishing returns, which prompts a reconsideration of self-building.

Speaker #3: For instance, certain advertisers who had previously shipped most of their budget to performance-based marketing or influencer seeding are now reallocating budget towards selecting endorsements, content creation, and sponsorship.

Speaker #3: While the transition is gradual and measured, we believe this trend is likely to continue. In the first half of 2025, advertisers from the SMCG category became increasingly interested in Weibo's product launch, celebrity, and IP marketing offerings.

Speaker #3: As a result, both the number of campaigns and the revenue generated from product launch and celebrity official announcement campaigns broke double-digit year-over-year growth. We are encouraged to see customer engagement through our product launch marketing further enhance, with the value of celebrity assets gradually revived.

Sandra Zhang: We are encouraged to see customer stickiness to our product launch marketing further enhanced, with the value of celebrity assets gradually revived. Meanwhile, we focus on tailoring our ad products to fulfill the more granular marketing needs of different segments within the FMCG sector. We seek to amplify the synergy between commercial content and organic posts and trending topics generated by celebrities or KOL, leveraging our ad product live content boosting and aggregations. With these efforts, we aim to facilitate more effective distribution of commercial content so as to cultivate consumer mindsets and drive conversions.

Speaker #3: And meanwhile, we focus on tailoring our ad products to fulfill the more granular marketing needs of different segments within the SMCG sector. We seek to amplify the synergy between commercial content and organic posts, as well as trending topics generated by celebrities or KOLs, leveraging our ad product-like content boosting and aggregation with these efforts.

Speaker #3: We aim to facilitate more effective distribution of commercial content so as to cultivate consumer mindset and drive conversion.

Gaofei Wang: information feeds and NextGen ads in Q2.

Speaker #4: 广告产品方面, 二季度信息流进展广告同比保持增长, 其中效果电商客户的投放效果增长不错。三季度, 我们会继续扩大客户覆盖, 这一增长趋势有望在下半年得到延续。同时, 二季度我们继续加强AI在商业领域的探索和应用, 提升广告素材、创建、审核效率, 以及广告定向和点击效果, 整体上促进到信息流进展广告ESPM在二季度的同比提升。

Sandra Zhang: From an ad product perspective, ad revenue from our promoter feed offerings and the real-time feeding system sustained solid year-over-year growth in the second quarter, with different enhancements of ad performance for those performance-driven e-commerce advertisers. In the third quarter, we plan to further expand advertiser coverage and see opportunity to extend this growth trend through the second half of this year. Meanwhile, we are stepping up our exploration and integration of AI on the monetization front, with its focus on streamlining ad creation and accelerating review process, as well as improving ad targeting and click-through rates. These initiatives successfully drove higher ECPMs for real-time business feed ads in the second quarter versus the same period last year.

Speaker #3: From an ad product perspective, ad revenue from our promoted feed offerings and the real-time seeding systems saw the same solid year-over-year growth in the second quarter, with a decent enhancement of ad performance for those performance-driven e-commerce advertisers.

Speaker #3: In the third quarter, we plan to further expand advertiser coverage and see an opportunity to expand this growth trend through the second half of this year.

Speaker #3: And meanwhile, we are stepping up our exploration and integration of AI on the monetization front, with a focus on streamlining ad creation, accelerating the review process, and improving ad targeting and click-through rates.

Speaker #3: These initiatives successfully drove higher ECPMs for real-time business feed ads in the second quarter versus the same period last year.

Gaofei Wang: 目前是三季度的商业化,由于去年存在奥运会的高接入的情况,对三季度的收入增速产生了一定负面影响。我们会积极把握电商、汽车、医疗健康等确定性客户的营销机会,提升品牌加内容营销在这些行业的渗透,以及我们在信息流进来广告方面取得的进展,获取收入增长预算。更为长期来看,我们会继续坚持内容运营和商业运营特别协同,随着新一流首页新流产品升级,强化垂直内容生态的发展,促进信息内容消费,内容营销能够更有效地触达及兴趣消费群体。我们在内容和新品营销的优势会更加凸显,从而强化 Weibo 在客户市场中的长期预算竞争力。

Speaker #4: 目前三季度商业化, 由于去年存在奥运会的高基数的情况, 对三季度的收入增速产生了一定负面影响。我们会积极把握电商、汽车、医疗健康等确定性客户的营销机会, 提升品牌+内容营销在这一行业的渗透, 以及我们在信息流进展广告方面取得的进展, 获取收入增加预算。更为长期来看, 我们会继续坚持内容运营和商业运营, 策略协同, 随着信息流首页信息流产品升级, 强化垂直内容生态的发展, 促进信息内容消费, 并营销内容营销能够更有效地触达及兴趣消费群体。我们在内容和新品营销的优势会更加凸显, 从而强化微博在客户市场中的长期预算竞争力。

Sandra Zhang: Entering the third quarter, we do face a tough comparison due to the high bids from last year's Olympics, which would negatively impact the year-over-year growth. That said, we will beef up sales efforts to capture visible opportunities from sectors such as e-commerce, automobile, and healthcare sectors, etc., with a focus on driving the penetration of our brand-plus content marketing among these sectors. Furthermore, we strive to secure incremental budgets, leveraging the progress we made in real-time information feed ad products. In the longer run, we remain committed to amplifying the synergy between content and monetization operations. With the revamp of information feeds on the homepage, we have a clear roadmap to further strengthen our vertical content ecosystem and reduce the interest-based content consumption, enabling commercial content to effectively reach desirable audiences.

Speaker #3: Entering the third quarter, we do face a tough comparison due to the high base from last year's Olympics, which would negatively impact the year-over-year growth.

Speaker #3: That said, we'll beef up sales efforts to capture visible opportunities from sectors such as e-commerce, automobile, and healthcare, among others. With a focus on driving the penetration of our brand and content marketing among these sectors.

Speaker #3: Furthermore, we strive to secure incremental budgets, leveraging the progress we made in real-time business feed ad products. In the longer run, we remain committed to amplifying the synergy between content and monetization operations.

Speaker #3: With the revamp of information feeds on our homepage, we have a clear roadmap to further strengthen our vertical content ecosystem and boost the interest-based content consumption, enabling commercial content to effectively reach desirable audiences.

Sandra Zhang: At that time, our value proposition of content and new product marketing will become even more pronounced and therefore reinforce Weibo's competitive edge in the ad markets.

Speaker #3: At that time, our value proposition of content and new product marketing will become even more pronounced and therefore reinforce Weibo's competitive edge in the ad market.

Gaofei Wang: 接下来让我转给唐飞介绍二季度的财务结果。

Speaker #4: 接下来, 让我转给陶斌介绍二季度的财务结果。

Sandra Zhang: With that, let me turn the call over to Fei Cao, Chief Financial Officer, for a financial review.

Speaker #3: With that, let me turn the call over to Fei Cao for a financial review.

Fei Cao: Thank you, Gaofei, and hello, everyone. Welcome to Weibo's second quarter earnings conference call. Let us start with user metrics. In June 2025, Weibo's MAUs and average DAUs reached 588 million and 261 million, respectively, representing a net addition of 5 million and 5 million users on a year-over-year basis. The DAU versus MAU ratio further enhanced as our strategic focus on high-quality users is paying off. Leveraging the transformative power of AI, we are revamping our recommendation systems as well as information feeds and intelligent search product experience to make Weibo more relevant and engaging. Turning to financials, as a reminder, my prepared remarks will focus on non-GAAP results. All monetary amounts are in U.S. dollar terms, and all comparisons are on a year-over-year basis, unless otherwise noted. Now, let us review the financial highlights for the second quarter 2025.

Speaker #5: Thank you, Gaofei and hello, everyone. Welcome to Weibo's second quarter, 2025 earnings conference call. Let's start with user metrics. In June 2025, Weibo's MAUs and average DAUs reached the first hundred eighty-eight million, and 261 million respectively, representing a net addition of 12 million and 12 million users on a year-over-year basis.

Speaker #5: The DAU versus MAU ratio further enhanced our strategic focus on high-quality users, and it is paying off. Leveraging the transformative power of AI, we are value-building our recommendation engine as well as feeds and search experience to make Weibo more relevant and engaging.

Speaker #5: Turning to financials, as a reminder, we prepared remarks with a focus on non-GAAP results. All monetary amounts are in U.S. dollar terms, and all comparisons are on a year-over-year basis, unless otherwise noted.

Speaker #5: Now, let's move you through our financial highlights for the second quarter 2025. Weibo's second quarter 2025 net revenues were $44.8 million, an increase of 2%.

Fei Cao: Weibo's second quarter 2025 net revenues were $444.8 million, an increase of 2%. Operating income was $161.8 million, representing an operating margin of 36%. Net income attributable to Weibo reached $143.2 million, an increase of 13%. The diluted EPS was $0.64. Let us add a few more colors on the second quarter 2025 revenue performance. Weibo's advertising and marketing revenues for the second quarter 2025 were $383.4 million, up 2%, while value-added service revenues were $61.4 million, down 6%. Weibo's advertising business continued to deliver a slight uptake, which resulted from mixed performance of major ad verticals by industry. Our top three verticals were FMCG, e-commerce, and food products. In terms of growth, e-commerce, internet services, and automobile were the key contributors, benefiting from the changing policies and intensifying competition among platforms. E-commerce advertisers increased their ad spending on Weibo to boost brand visibility during the June 18th Shopping Festival.

Speaker #5: Operating income was $161.8 million, representing an operating margin of 36%. Net income attributed to Weibo reached $143.2 million, an increase of 13%.

Speaker #5: And diluted EPS was $0.54 USD. Let me give you more color on the second quarter 2025 revenue performance. Weibo's advertising and marketing revenues for the second quarter 2025 were $183.4 million USD, up 2%.

Speaker #5: While value-added service revenues were $61.4 million, down 2%, Weibo's advertising business continued to deliver a slight uptick. This resulted from mixed performance of major ad verticals by industry. Our top three verticals were SMCG, e-commerce, and 3C products.

Speaker #5: In terms of growth, e-commerce, internet services, and automobiles were the key contributors. Benefiting from trading policies and intensifying competition among platforms, e-commerce advertisers increased their ad spending on Weibo to boost brand visibility during the June 18 shopping festival.

Fei Cao: The automobile sector sustained healthy growth, as Weibo plays an increasingly important role in building market share for EV launches, underpinned by strong discussion value of the auto vertical. The FMCG sector continued to see a year-over-year decline. However, we are seeing early signs of gradual recovery. Despite near-term pressure, we are encouraged to see a gradual comeback with the Yosemite Festival brand FMCG brands, reallocating their budget to Weibo's celebrity and product launch ad offerings to engage our young and high-value users. Other underperforming industries that drag the overall top line of traffic, including online games, luxury, and entertainment. In particular, the online gaming sector remains soft due to tough comps and the lack of blockbuster releases this quarter. The ad products category, promoting feeds ads, remains the largest contributor, followed by social display ads and topics and search placement.

Speaker #5: The automobile sector sustained healthy growth. As Weibo plays an increasingly important role in building market hubs for EV launches, this is underpinned by strong discussion webs of the auto vertical.

Speaker #5: The SMCG sector continued to see a year-over-year decline. However, we are seeing early signs of gradual recovery. Despite near-term pressure, we are encouraged to see a gradual comeback, with those major festival brand SMCG brands reallocating their budget to Weibo's celebrity and product launch ad offerings.

Speaker #5: To engage our young and high-value users, our underperforming industry that dragged the overall top-line recovery included online games, lectures, and entertainment. In particular, the online game sector remained soft due to tough comps and a lack of blockbuster releases this quarter.

Speaker #5: By ad product category, promoted feeds ads remained the largest contributor, followed by social display ads and topic and search placement. We have been integrating AI to facilitate smarter ad targeting and placement.

Fei Cao: We have been integrating AI to facilitate smarter ad targeting and placement, which fueled the double-digit growth of our feed ad offerings. Specifically, our real-time feed products show strong improvements in both performance and conversion metrics. Ad revenues from Alibaba sustained a healthy growth of 10%, reaching $35.7 million in the second quarter. We gained a larger share of Alibaba's ad wallet in Q2, driven by increased market demand during the June 18th Festival, and heightened competition in the local survey segment. Looking ahead to the second half of the year, we expect to face a tough year-over-year comparison in the first quarter due to the Summer Olympics in the prior year. Advertisers from consumption-related industries remain conservative in their ad budget allocation in light of U.S. geopolitical outlook and the macro uncertainty.

Speaker #5: Which filled the double-digit growth of our feed ad offerings. Specifically, our real-time BD feed products saw strong improvements in both performance and conversion metrics.

Speaker #5: Ad revenues from Alibaba sustained a healthy growth of 10%, reaching $35.7 million in the second quarter. This was driven by a larger share of Alibaba's ad wallet in Q2, which was supported by increased marketing demand during the June 18 festival and heightened competition in the local service segment.

Speaker #5: Looking ahead to the second half of the year, we expect to face a tough year-over-year comparison in the third quarter due to the Summer Olympics in the prior year.

Speaker #5: Also, advertisers from consumption-related industries remain conservative in their ad budget allocation in line with loyalty, still affected by political outlook and micro uncertainty. That said, we will step up our sales execution to capture engagement opportunities.

Fei Cao: That said, we will step up our sales execution to capture engaging opportunities, particularly in on-demand e-commerce services and new EV launches. In the longer term, we aim to further integrate AI capabilities to drive meaningful improvements in ad inventory, scalability, and ECPM updates. Value-added service revenues rose 2% to $61.4 million in the second quarter, mainly due to our modest decrease in membership services. Turning to cost expenses, total cost expenses for the second quarter were $283 million, an increase of 1%, with an increase in cost of revenue and product development expenses offset by decrease in general and administrative expenses. Operating income in the second quarter was $161.8 million, an increase of 3%, representing an operating margin of 36% versus the same period last year. Turning to income tax, under GAAP, income tax expenses for the second quarter were $31.7 million, compared to $33.3 million last year.

Speaker #5: Particularly in on-demand e-commerce services and new EV launches. In the longer term, we aim to further integrate AI capabilities to drive meaningful improvement in ad inventory availability and eCPM updates.

Speaker #5: Value-added service revenues rose 2% to $61.4 million in the second quarter, mainly due to a modest decrease in membership services. Turning to costs and expenses, total costs and expenses for the second quarter were $283 million.

Speaker #5: An increase of 1%, with an increase in cost of revenue and product development expenses offset by a decrease in January and administrative expenses. Operating income in the second quarter was $161.8 million.

Speaker #5: An increase of 3%, representing an operating margin of 36%, is less versus the same period last year. Turning to income tax, under GAAP, income tax expenses for the second quarter were $31.7 million.

Speaker #5: Compared to $33.3 million USD last year, net income attributed to Weibo in the second quarter was $143.2 million USD, an increase of 13%.

Fei Cao: Net income attributable to Weibo in the second quarter was $143.2 million, an increase of 13%, representing a net margin of 32% compared to 29% last year, primarily attributable to higher net interest and other income. Turning to our balance sheet and cash flow items, as of June 30, 2025, Weibo's cash and short-term investment totaled $2.11 billion, compared to $2.35 billion as of December 31, 2024. The decrease of Weibo's cash and short-term investment mainly resulted from the purchase of long-term wealth management products and the payment of the annual dividend to our shareholders in the first half of 2025, and partially offset by operating cash flow. In the second quarter, cash provided by operating activities was $23.8 million. Capital expenditures totaled $73.6 million, and depreciation and amortization expenses amounted to $14.8 million. With that, let me now turn the call over to the operators for the closing session.

Speaker #5: Representing a net margin of 32%, compared to 29% last year, this increase is attributable to higher net interest and other income. Turning to our balance sheet and cash flow items, as of June 30, 2025, Weibo's cash equivalents and short-term investments totaled $2.11 billion.

Speaker #5: Compared to $2.35 billion USD as of December 31, 2024, the decrease of Weibo's cash, cash equivalents, and short-term investments was mainly the result of the purchase of long-term wealth management products and the payment of the annual dividend to our shareholders in the first half of 2025.

Speaker #5: And partially offset by operating cash flow. In the second quarter, cash provided by operating activities was $24.8 million. Capital expenditures totaled $17.6 million, and depreciation and amortization expenses amounted to $14.8 million.

Speaker #5: With that, let me now turn the call over to the operator for the Q&A session.

Operator: Thank you. As a reminder, to ask a question, please press star one and one on your telephone keypad and wait for your name to be announced. To withdraw your question, please press star one and one again. Please stand by as we compile the Q&A roster. Our first question comes from the line of Felix Liu from UBS. Please go ahead.

Speaker #2: Thank you. As a reminder, to ask a question, please press *1 and 1 on your telephone keypad and wait for your name to be announced.

Speaker #2: To withdraw your question, please press star, one, and one again. Please stand by as we compile the Q&A roster. Our first question comes from the line of Felix Liu from UBS.

Speaker #2: Please go ahead.

Gaofei Wang: 谢谢管理层接受我的提问, 也恭喜我们二季度很好的一个业绩。刚刚管理层提到了微博自搜的进展, 我想请管理层进一步分享一下我们自搜产品策略以及未来商业化的想法。另外, 能否请管理层分享一下 AI 对于促进我们商业化方面的进展? Thank you, management, for taking my question and congratulations on the strong second quarter results. Management earlier mentioned your progress on Weibo's intelligent search product. Can management elaborate a bit more on your product strategy and the future plan for commercialization? Furthermore, on AI, could management share more progress on how AI is helping the overall monetization and commercialization for the Weibo platform? Thank you.

Speaker #6: ??????????????????????????????????????????????????????????????????????????????????????????AI???????????????Thank you, management, for taking my question and congratulations on the strong second quarter results. Management, earlier mentioned about your progress on Weibo Smart Search.

Speaker #6: Could management elaborate a bit more on your product strategy and the future plan for commercialization? Furthermore, on AI, could management share more progress on how AI is helping the overall monetization and commercialization of the Weibo platform?

Speaker #6: Thank you.

Gaofei Wang: 我们在上季度其实跟大家有一个简单的分享过自搜。然后呢, 我们在一季度其实主要是刚刚进入了DeepSeek, 把搜索结合这种DeepSeek R1的模型, 然后推出自搜这个产品。二季度来讲的话呢, 算是自搜在Weibo推出的相对比较完整的一个季度。在二季度的六月份的时候, 我们又把这个自搜接入了这个Alibaba Qwen的模型, 主要是因为之前R1的模型其实在输出结果上的速度是比较低的。其实我们还是有很多用户其实等不到这个结果的产出。所以说整体来看的话呢, 在二季度自搜这个产品还是处于比较进化或者完善的一个过程中。在二季度末相对来讲的话, 产品形态上算是基本的稳定。

Speaker #4: Okay. Thank you. 我们在上一季的节目当中有简单分享过这搜, 然后我们在一季度其实主要是刚刚接入了这种DeepSeek, 把搜索接入了这种DeepSeek R1的模型, 然后推出了自搜这个产品。二季度来讲的话, 算是自搜在微博推出的相对比较完整的一个季度。在二季度的六月份的时候, 我们又把这个自搜接入了这个阿里千问的模型, 主要是因为之前R1的模型其实在输出结果上的速度是比较低的, 其实我们还是有很多用户其实等不到这个结果的产出。所以说整体来看的话, 在二季度自搜这个产品还是处于比较进化或者完善的一个过程中。在二季度末相对来讲的话, 产品形态上算是基本的稳定。 Okay, so actually in the last quarter, we've already shared that in Q1, we promoted the intelligence search product.

Gaofei Wang: In the last quarter, we already shared that in Q1, we promoted the intelligent search product. In Q1, we actually connected to the DeepSeek R1 model, and we promoted the product, launched the product. In Q2, it was a first full season for the intelligent search to be present in Weibo. In June, we also connected to the Ali Q1 because for the DeepSeek R1 model, in terms of the output speed, it is a bit low. A lot of users could not wait for the results we produced. In general, we should say that in Q2, the product is still being perfected, and it is still in the process. Basically, at the end of Q2, the product form was finally stable.

Speaker #4: In Q1, we actually connected to the DeepSeek R1 model, and we promoted the product and launched the product. In Q2, we had our first full season for the intelligence search to be present on Weibo.

Speaker #4: And then in June, we also connected to the Ali Q1. Because for the DeepSeek R1 model, in terms of the output speed, actually it's a bit low.

Speaker #4: So actually a lot of users couldn't wait for the result to be produced. So in general, we should say that, in Q2, the product is still being perfected and it's still in the process.

Speaker #4: So basically at the end of Q2, the product form was finally stable. The六月份来讲的话, 自搜的MAU刚才我介绍了, 超过了五千万, 管理大概有一个百分之六十的提升。那它的DAU和用户的query量来讲的话, 增长可能更为快一些。然后日使用的污染可能增速可能从百分之百, 然后query量的增速大概比上个季度提升大概在一百五左右吧。然后所以说整体搜索的这种我们从这个数据也能看到, 整个用户的使用规模在增长, 而且用户使用的频次也在明显的提升。 Then actually in terms of June, just now we introduced that actually for the MAU, it's already over 50 million.

Gaofei Wang: 六月份来讲的话呢,自搜的 MAUs,刚才我介绍了,超过了 5,000万,大概有一个 60%的支撑。它的 DAU和用户的 query量来讲的话呢,增长可能更为快一些。日使用用户量可能增速可能超过 100%。Query量的增速大概比上个季度提升大概在 150左右吧。所以说整体搜索的这种,我们从这个数据也能看到,整个用户的使用规模在增长,而且用户使用的频次也在明显的提升。

Gaofei Wang: Then, in terms of June, just now we introduced that for the MAU, it is already over 50 million. For query, it also improved by 60%. As for the DAU and for the user query, the growth was even faster. The growth rate was already over 100%. In terms of the traffic, it grew by around 150% compared to the previous quarter. In general, we can see from that data, the user scale is growing and the frequency of usage is obviously increasing.

Speaker #4: So for query, it also improved by 60%. As for the DAU and for the user query, actually the growth was even faster. So, actually the growth rate was already over 100%.

Speaker #4: And in terms of the traffic, it grew by around 150% compared to the previous quarter. So, in general, we can see from that data that the user scale is growing, and the frequency of usage is obviously increasing.

Gaofei Wang: 我们对于下半年自搜的产品功能上的期望还是比较高的, 大家您关注微博的人可以看到, 就是微博我们搜索其实长期一直它的优势是在新闻搜索方面, 我们在更长尾的搜索方面呢, 一直这个平台上面的优势不是不太强。但是自搜这样一个产品, 我们会看到在用户目前的使用里面, 当然基于新闻的搜索还是很大的一个比例, 但是有越来越多的用户在使用自搜之后开始使用自搜的一些经验搜索, 然后包括产品搜索, 然后包括长尾搜索这方面的功能。然后我们认为包括现在的一些模型, 它的内容的引入, 包括一些也帮助我们进行了一些在外的一些信息搜索的结果, 在站内在微博自搜里面可以获得体现。这也对于我们未来改变我们目前微博搜索用户的使用习惯, 提升他们长尾搜索的这种占比是至关重要的。

Speaker #7: 我们这里对下半年自搜的产品功能上的期望还是比较高的。大家您关注微博的人可以看到,

Speaker #4: 就是微博我们搜索其实长期一直它的优势是在新闻搜索方面。我们在更长尾的搜索方面呢, , , , , 一直这个平台上面的优势不是不太强。但是自搜这样一个产品, 我们会看到在用户目前的使用里面, 当然基于新闻的搜索还是很大的一个比例。但是如果越来越多的用户在使用自搜之后, 开始使用自搜的一些经验搜索, 包括产品搜索, 包括长尾搜索这方面的功能, 然后我们认为包括现在的一些模型, 它的内容的引入, 包括一些也帮助我们进行了一些站外的一些信息搜索的结果。在站内, 在微博自搜里面可以获得体现。这也对于我们未来改变我们目前微博搜索用户的使用习惯, 提升他们长尾搜索的这种占比, 是至关重要的。 So So actually we have pretty high expectation on the intelligence search product in the latter half of the year.

Gaofei Wang: We have pretty high expectation on the intelligent search product in the latter half of the year. If you have been following Weibo, you would know that we have always had the advantage of news search. In terms of the long-tail searches, Weibo is not that advantageous in that aspect. With this product, we can see that in the current usage by the users, the search on the news is still accounting for a big percentage, but more and more users are using it. Now they are using it for the experience search, product search, maybe some other long-tail searches. With the connection of the models and other content, it also helps us in terms of displaying some of the out-of-site search results that can be displayed in the intelligent search on Weibo.

Speaker #4: And I think if you have been following Weibo, you would know that actually we have always had the advantage of news search. But in terms of the long-tail searches, actually Weibo isn't that advantageous in that aspect.

Speaker #4: But right now, with this product, we can see that in the current usage by the users, of course, the search on the news is still accounting for a big percentage.

Speaker #4: But more and more users are using it, and now they're using it for experience search, product search, and maybe some other long-tail searches. Furthermore, with the connection of the models and other content, it also helps us in terms of displaying some of the out-of-sight search results that can be displayed in the intelligence search on Weibo.

Gaofei Wang: That is very vital for Weibo to really change the user behavior of the users and also to improve the percentage of the long-tail searches.

Speaker #4: And that is very vital for Weibo to really change the user behavior of the users and also to improve the percentage of the long-tail searches.

Gaofei Wang: 那我们可以现在看着，我觉得整个行业大家已经有一定的一个认知，就是AI搜索其实对于传统的这种搜索的取代还是明显的一个趋势。具体到社交媒体平台上，我们会看到对我们而言不单单是要去把本身的搜索功能做好，而且它使用微博也可以看到用户其实跟自搜这样一个产品它之间的沟通，除了搜索之外，也包括了社交互动，比如说在评论里面用自搜进行求证，以及很多进行博文本身的一些功能性去求证一些这种博文本身微博本身的真实性，或者扩展阅读方面，其实应用场景还都是比较多的。这也是下半年我们重点要去产品开发的一个工作，现在已经有一些试点。至于说商业化方面来讲的话，我们对这个产品感兴趣的客户比较多，但是目前我们在商业化方面还不是特别的着急，可能更多的还是先去扩大它的用户数和它的用户规模。至于说它的商业化未来是基于品牌来去做这种绑定式的合作，还是说像传统搜索一样是在搜索结果里面增加这种比如说广告，我们可能下半年三季度不太会去考虑，可能在四季度会做一些测试。但是整体来看的话，我们会觉得这样一个产品对于我们提升我们搜索的用户规模，包括我们整体的用户的粘性和流量，还是数据增长确实比较快，我们对这个产品未来的商业化一定有一个比较高的期望值。

Speaker #4: 现在看, 我觉得整个行业大家已经一致的一个认知, 就是AI搜索其实对于传统的这种搜索的取代还是明显的一个趋势。具体到社交媒体平台, 让我们会看到对我们而言不单单是要去把本身的搜索功能做好, 而且它使用微博的也可以看到用户其实跟自搜这样一个产品, 它之间的沟通, 除了搜索之外, 也包括了社交互动。比如说在评论里面用自搜进行求证, 以及很多进行博文本身的一些功能性去求证一些这种博文本身微博本身的真实性或者扩展阅读方面, 其实应用场景还都是比较多的。这也是下半年我们重点要去产品开发的一个工作。现在已经有一些试点了。那至于说商业化方面来讲的话, 我们对这个产品感兴趣的客户比较多, 但是目前我们在商业化方面还不是特别的着急。然后可能更多的还是先去扩大它的用户数和它的用户规模。那至于说它的商业化未来是基于品牌来去做这种绑定式的合作, 还是说像传统搜索一样是在搜索结果里面增加这种, 比如说广告, 我们可能下半年三季度不太会去考虑, 可能在四季度会做一些测试, 未必。但是整体来看, 我们会觉得这样一个产品对于我们提升我们搜索的用户规模, 包括我们整体的用户的粘性和流量还是数据增长确实比较快。我们对这个产品未来的商业化进入一个比较高的期望值。 So So actually in the industry, people have this general awareness that AI search is clearly overtaking and replacing the traditional search.

Gaofei Wang: In the industry, people have this general awareness that AI search is clearly overtaking and replacing the traditional search, and that is a clear trend. Now in the social media platforms, we can see that for us, we are not only making the search function better, in terms of the usage on Weibo, you can see that for users, when they use this product, it is not just about the search, it is also about social interactions. For example, in the comment sections, they can do fact checking, and also for some of the blogs, they can also use this kind of tool to fact check or maybe do some extensive reading for the relevant material. There are a lot of use cases and scenarios, and they are some of the key directions for our latter half of the year, and we do have some pilots going on.

Speaker #4: And that is a clear trend. And now, in the social media platforms, we can see that for us, we're not only making the search function better. Actually, in terms of the usage on Weibo, you can see that for users, when they use this product, it's not just about the search.

Speaker #4: It's also about social interactions. For example, in the comment sections, they can do fact-checking, and also for some of the blogs, they can use this kind of tool to fact-check or maybe do some extensive reading for the relevant material.

Speaker #4: Actually, there are a lot of use cases and scenarios. And they are some of the key works, key directions for our latter half of the year.

Speaker #4: And we do have some pilots going on. In terms of commercialization, we should say that actually a lot of clients are interested in this product.

Gaofei Wang: In terms of commercialization, we should say that a lot of clients are interested in this product, but we are not overly anxious in terms of commercialization, and we tend to try to expand the user base right now. In the future, for the commercialization, maybe it is about the bundled cooperation with the brands, or maybe it is just like in the traditional search where we include ads in the search results. In the latter half of the year, in Q3, we may not consider that. Maybe in Q4, we would do some tests. Overall speaking, we should say for this product, it is really important for us to increase the user base for the search and also to help us increase the user stickiness and the traffic. We have a really high expectation in terms of the future commercialization of the product.

Speaker #4: But we are not overly anxious in terms of commercialization. We tend to try to expand the user base right now. In the future, for commercialization, maybe it's about the bundled cooperation with the brands, or maybe it's just like in traditional search, where we include ads in the search results.

Speaker #4: But actually, in the latter half of the year, in Q3, we may not consider that. Maybe in Q4 we would do some tests. But overall speaking, we should say that for this product, it's really important for us to increase the user base for the search and also to help us increase user stickiness and traffic.

Speaker #4: And we have really high expectation in terms of the future commercialization of the product. 刚才您说的第二个问题是关于AI和广告的。然后广告这方面, 一方面我觉得其实这个进展其实大部分的平台都类似, 就是说集中在效果广告方面。我们一方面是包括这种AI素材的自动投放, 我们在二季度上线了我们自己内部的这个叫AI广告的创意平台, 零创平台。目前来讲的话, 现在素材消耗里面百分之十几是来自于AI的这个素材。那结果来看, 其实刚才在Screen里面也说到了我们整个二季度整个新季度静态广告的ECPM大概增长了个位数吧。对, 然后不到百分之十, 具体到CTR方面可能不同客户的这种类型不一样, 线索类的可能CTR提升高一些, 大概百分之20%左右。但是这个APP的可能在百分之十几, 但是综合到ECPM上可能在不到百分之十吧。这是一个这个信息流, 也就是说效果广告方面的一个进展。 So just now your second question was about AI ads.

Gaofei Wang: rate 方面，可能不同客户的这种类型不一样，线索类的可能 click-through rate 提升高一些，大概 20% 左右。但是调这个 APP 的可能在百分之十几，但是综合到 ECPM 上可能在不到 10% 吧。这是一个这个信息流，也就是说 performance-based ads 方面的一个进展。

Gaofei Wang: Your second question was about AI ads. In terms of ads, I think most of the platforms are alike. That means they are mostly concentrating on the performance-based ads. For us, on one side, it is about the auto placement of the AI assets. In Q2, we launched our AI ad creative platform called Lingchuan. Right now, for the assets that are consumed, more than 10% is already from AI. From the results, we already talked about it, for Q2, in the information feed ads, the ECPM growth grew by single digit, less than 10%. When it comes to click-through rate, I think for different clients, for different client types, things would be different. For the leads type, the click-through rate would be higher, maybe around 20%, but for the apps, maybe more than 10%. Comprehensively, the ECPM maybe grew by less than 10%.

Speaker #4: In terms of ads, I think most of the platforms are alike. That means they are mostly concentrating on performance-based ads. And for us, on one side, it's about the auto-placement of the AI assets.

Speaker #4: So in Q2, we launched our AI ad creative platform called Lingchuang. And right now, for the assets that are consumed, actually more than 10% is already from AI.

Speaker #4: And from the results, just now we already talked about it, for Q2, in the information feed ads, the eCPM growth grew by single digits, less than 10%.

Speaker #4: And then when it comes to CTR, I think for different clients, for different client types, things would be different. For the leads type, the CPR would be higher, maybe around 20%.

Speaker #4: But for the apps, maybe more than 10%. But comprehensively, the eCPM may have grown by less than 10%. So that's for information feed or maybe for the performance-based ads.

Gaofei Wang: That is for information feed or maybe for the performance-based ads.

Gaofei Wang: Weibo投放的这种广告素材的质量还是比较高的. 我们其实在 Q2做了一些个别客户合作, 做了一些测试, 因为把他们的一些比较高质量的 TVC的广告用 AI。我们会进行一些调,

Alfredo: 或者针对不同用户群，根据他们的兴趣去做这种，他们的素材的再剪辑。那这个其实比我们原来预想的效果可能要比纯粹的效果，这个中小的效果，客户会要更好。我们看到的一些这种测试数据，基本上它的点击率可能提升跟效果好像差不多，但是它的互动率的提升其实甚至有翻倍的一个提升，整体效果还是不错的。但是对于品牌客户来讲，现在比较大的一个挑战还是在于整个的这种行业的这种广告投放流程方面的现实。我们基本上我们的品牌客户在 Weibo进行这种信息流的投放，都还是要求素材要通过他们的审核的。那这样一个工作流程其实对于 AI广告，那一个素材，它进行全人切面的这种广告素材再编辑，其实还是不太适应，就是限制了我们的客户，特别是品牌客户使用我们的 AI广告的规模。整体来看的话呢，品牌广告其实我们觉得如果能大范围使用 AI广告的话，这个效果提升会更明显，但是可能需要比较长的时间让我们的客户群体慢慢接受。我们预期到年底我们需要我们品牌客户里面大概有十几%能够开始使用我们的这种品牌的 AI广告的系统。但是这个我们认为不会那么的快，可能真正能够效果广告来讲的话，使用 AI广告的比例肯定是要远远超过品牌的。

Sandra Zhang: In terms of the brand ads, for a lot of the brand customers, they are placing quite high quality ad assets on Weibo. In Q2, we have done some tests with some specific customers. For them, they have some high quality PVC ads, and then we use AI to conduct some coordination for different user bases, according to their interest. We conducted some re-editing with their existing assets. Actually, in terms of the result, it is better than the results for the small and medium sized customers. They saw some of our testing results. Basically for the click rate, it increased just like the performance-based ads, but for the interaction, it basically doubled. The overall result was pretty good. For the brand clients, the biggest challenge is still in the restraints of the process of ad placement.

Sandra Zhang: Basically, for our brand customers, when they place the information feed ads, they require all the assets to be approved on their side. That kind of work process for AI ads, which is quite customized for different people, is not really adaptive. That really limits our customers, especially the brand customers, when they want to use our AI ads at scale. Generally speaking, for the brand ads, I think if we can use AI ads on a large scale, the performance and the results would be even more obvious in terms of this improvement. It may take some time for our customers to gradually accept it. We expect that at the end of the year, maybe more than 10% of our brand customers can start to use the AI ad system.

Sandra Zhang: Thank you. Just a moment for our next question, please. Next, we have Timothy Zhao from Goldman Sachs. Your line is now open.

Gaofei Wang: 好的, 关键层晚上好, 感谢接受我的提问。我的问题是有关我们的广告收入的。想请教一下我们对这个公司的第三季度和今年下半年整体的广告收入有怎样的一个展望？哪些行业应该会展现出比较好的一个增速？另外从一个广告的模式上面就想请教一下, 如果我们去看像这个展示广告、搜索广告, 包括我们刚刚聊到的这个信息流广告, 在今年下半年是一个怎样的增长预期？关键层刚刚也提到这个 AI 在信息流效果广告上面的一些应用。想请教一下如果是到这个智搜的话, 我们看到智搜的用量提升的是非常高。这部分对我们已经有的这个搜索广告, 是有怎样的一些影响？我很快翻译一下, thank you management for taking my question. My question is regarding the advertising revenue growth outlook. Can management share what is your expectation for the ad revenue growth into the third quarter and second half of this year? Specifically, which industries may show a stronger revenue growth? From the format perspective, just wondering, what is the difference in terms of growth rate, between search ads, display ads, recommendation feed ads, et cetera? Specifically, as management already mentioned, the applications of AI, in information ads. Just wondering, given the very rapid usage of the AI search functions on Weibo, what is the implications for the search ads growth? Thank you.

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Cam address share what is your expectation for the revenue growth into the third quarter and second half of this year and it's specific to you which industries.

So stronger revenue growth.

From a format perspective, just wondering a.

What is the difference in terms of growth rate.

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Mentioned the applications of AI inflammation as just wondering given the very rapid usage of the search functions on weibo.

Applications for the search ads growth. Thank you.

Alfredo: industry has also grown well in the past one or two years, but its base is not as large as e-commerce or automotive. These are industries with good growth.

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Sandra Zhang: In the latter half of the year, especially when we look at the industries with some national subsidies, those industries still have some uncertainties, especially the national subsidy related industries like the cell phone or the automotive industry. When it comes to Q3, I think, firstly, we already covered that in Q2, which was e-commerce and also the automotive industry. We think those industries can still maintain very good growth. In the last two years, with the change of the age of our users, especially for the white collars, people generally paid more attention to healthcare. Healthcare had pretty good growth in the last two years, but the base number was not as large as e-commerce and the automotive industry. Those are the growing sectors.

So in the latter half of the year, especially when we look at the industries with some national subsidies are those industries still have some uncertainties, especially the national subsidy related industries like.

The cell phone or the automotive industry.

Then when it comes to Q3 I think.

Firstly I think we already covered about that in Q2, which was E. Commerce and also automotive industry. We think those industries can still maintain very good growth and in the last two years.

With the change of the age of our users, especially for the white colors people generally paid more attention to healthcare so healthcare had pretty good growth in the last two years, but the base number was not as large as e-commerce and automotive industry. So those are the growing sector.

Yeah.

Alfredo: very minimal. We probably need to prioritize increasing user scale, especially since the current user experience and industry feedback for self-search are quite good. In the second half of the year, we might increase investment in external resources, including computing power and external marketing collaborations. We hope to gain more user growth through self-search. This is our highest expectation for this product right now. I don't think we are in a hurry regarding revenue. Thank you.

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Sandra Zhang: Actually in Q3, we still face a lot of pressure in terms of FMCG because there was the Olympics last year. For dairy products and other FMCG had some spending cuts, especially in Q3. The other thing is for the cosmetics and luxury goods, cosmetics have already quite stabilized, but we still face some pressure in Q3. Also, the same thing goes for luxury goods. For cell phone and gaming industry, there is huge uncertainty. For cell phone this year, we do see that compared to the first half of the year, their budget basically stabilized, but their overall sales went down a lot. If there is no additional national subsidy policies coming out, we still expect some pressure in terms of the cell phone industry in the latter half of the year.

Yes.

So actually in Q3, when you still face a lot of pressure in terms of FMC G by guess.

There was the Olympics last year, so for dairy products and other S. Mcg some spending cuts in especially in Q3 and the other thing is for the cosmetics and luxury goods cosmetics has already quite stabilized, but will you still face some pressure in Q3 and also the same thing.

Those four are luxury goods and then for cell phone and gaming industry. There is huge uncertainty for cellphone and this year, we do see that compared to the first half of the year.

They are budget basically stabilized, but their overall sales went down a lot. So if there is no additional national subsidy policies coming out we still expect some pressure in terms of the cell phone industry in the latter half of the year and then in terms of the AD strategy.

Sandra Zhang: In terms of the ad strategy, I think the biggest percentage still goes to the information feed ads, then the display ads, and then the other ads. For the information feed ads, it is growing in itself. In terms of the growth rate, I think for information feed ads, the growth rate is the highest. Actually for the display ads in Q1 and Q2, there was a small dip because I think that is related to the overall budget of the customers. For the information feed ads and the performance-based ads and for the maybe content-based ads, and then for the purely displayed ads, from our perspective, I do not think the pure displayed ads is our future focus. That means more and more customers will purely go to performance-based ads. Also they may invest more in terms of star collaboration or maybe KOL investment.

I think the biggest percentage still goes to the information feed ads and then the displayed as.

The the other ads and then for the information feed ads.

It's growing in itself.

In terms of the growth rate I think for information feed ads the growth rate is the highest.

And actually for the displayed ads in Q1 and Q2, there was a small dip.

I think that's related to the overall budget of the customers.

For the information feed ads and performance based as AD for the maybe content.

Just to add.

Then for the purely you displayed ads for our from our perspective I don't think the pure displayed ads as our future focus so that means more and more customers were purely you go to our.

Performance based ads and also they may invest more in terms of star collaboration or maybe K O L investment and maybe customers. They have their own accounts. The social media account that can produce some content based marketing type of ads that as the mainstream in the future and.

Sandra Zhang: Maybe customers they have their own accounts, the social media account that can produce some content-based marketing type of ads. That is the mainstream in the future. For the search ads, I just introduced that, of course, there are certain customers, they have some expectation on the monetization or commercialization. For us, or even in the industry, there is no clear business model for this type of ads. Right now we still focus more on building a bigger customer base and introducing more traffic. Of course, maybe we can introduce a bit of the displayed ads, but that is too small a piece. I think we still will focus more on increasing the user base. Also we need to focus on the user experience of the intelligent search and also the feedback of the industry had been good.

For the search ads.

I just introduced that of course, there are certain customers. They have some expectation on the monetization.

Monetization or commercialization, but for us we're even in the industry. There is no clear business model for this type of ads. So right now we still focus more on building.

Building, a bigger customer base and introducing more traffic and of course, maybe we can introduce a bit of the display to us, but that's too small piece. So I think we still will focus more on increasing the user base and also we need to focus on the user experience.

Intelligent search and also the feedback of the industry had been good. So we would increase a bit in terms of the budget, maybe and computing power and also the investment for the external cooperation and marketing and we hope that that will help us grow in terms of the user base.

Sandra Zhang: We would increase a bit in terms of the budget, maybe in computing power and also the investment for the external corporation and marketing. We hope that that will help us grow, in terms of the user base, because that's the highest expectation we have now for this product. In terms of the revenue and commercialization, we're in no hurry. Thank you.

Because that's the highest expectation we have now for this product in terms of the revenue and the commercialization we're in no hurry.

Great.

Okay.

Sandra Zhang: Thank you. Thank you for the questions. I will now turn the conference back to Sandra.

Thank you.

<unk> for the questions I will now turn the conference back to Sandra.

Fei Cao: Thank you, Alfredo. This wraps up our conference call today. Thank you all for joining us. We will see you next quarter.

Thank you operator is wrap up our conference call today. Thank you all for joining US we'll see you next quarter.

Sandra Zhang: This concludes today's conference call. Thank you for participating. You may now disconnect.

This concludes today's conference call. Thank you for participating you may now disconnect.

Okay.

[music].