Q2 2026 Phoenix Media Investment (Holdings) Ltd Earnings Call
Speaker #1: Thank you for standing by. Welcome to Phoenix New Media, Q2 2026 earnings call. At this time, all participants are to listen-only mode. After the speaker's presentation, there will be a Q&A session.
Speaker #1: To ask a question during the session, you will need to press *11 on your telephone. You will then hear an automated message advising your hand is raised.
Speaker #1: To withdraw your question, please press *11 again. Please be advised that today's conference is being recorded. I will now like to turn the conference over to your first speaker today, Mu Ziguo, from Investor Relations.
Speaker #1: Please go ahead.
Speaker #2: Thank you, operator. Welcome to Phoenix New Media's earnings conference call for the Q2 of 2026. Today's call will begin with an overview of our quarterly results followed by a Q&A session.
Speaker #2: Our quarterly financial results and the webcast of this conference call are available on our website at ir.iPhone.com. Before we continue, please note the Safe Harbor statement included in our earnings press release.
Speaker #2: Which applies to any forward-looking statements made during this call. Unless otherwise stated, all figures mentioned are in R&B. Joining me today are our CEO, Li Qi, and our CFO, Edward Liu.
Speaker #2: I will now pass the call to Mr. Li for his opening remarks. I will provide translation as needed.
Speaker #3: 各位投资人、分析师朋友大家好，欢迎参加凤凰网2026年第二季度的业绩电话会。我是凤凰网新任的CEO李奇。很高兴首次以CEO的身份和大家一起交流。我也期待未来与各位投资人保持持续的沟通。我将与管理团队一起继续聚焦凤凰网的优势。 核心优势：专业内容、品牌影响力和商业化能力。不断提升运营效率，夯实业务基础，持续提升公司的长期价值。那么接下来，首先请CFO吕静向大家介绍本季度的业务进展情况和经营情况。谢谢。
Speaker #2: Hello everyone, and welcome. I am Li Qi, the new CEO of Phoenix New Media. It is my pleasure to join you for the first time in this role.
Speaker #2: I look forward to maintaining ongoing communication with our investors. Together with the management team, I will continue to focus on Phoenix's core strengths, including our professional content capabilities, brand influence, and commercial capabilities.
Speaker #2: We will continue to improve operational efficiency, strengthen our business foundation, and enhance long-term value for our shareholders. Next, I would like to invite our CFO, Edward, to walk you through our business performance and key developments during the quarter.
Speaker #3: Okay. Thank you, Musa. In Q2 2026, we saw continued strong demand from brand advertisers for high-quality content. As information becomes more fragmented and the user attention becomes harder to capture, high-quality content that effectively connects brands with audiences has become increasingly valuable.
Speaker #3: Leveraging our longstanding content expertise, we are deepening our strategy of driving business value through quality content. This quarter, several major international events demonstrated our ability to produce high-quality content and respond quickly.
Speaker #3: During President Trump's visit to China, Phoenix provided full-life coverage of the key activities and captured the critical moments in real time. Our video "How Works a Chinese Company" representatives at Trump's welcome dinner achieved over 40 million views on Douyin and WeChat channels.
Speaker #3: We are also leading to additional business opportunities with major brand clients. This is a good example of how premium journalism can translate into commercial value.
Speaker #3: Our systematic approach to major event coverage—from preparation and live reporting to follow-up analysis—continues to differentiate us. During the Iran conflict, we delivered fast, high-quality coverage through breaking live broadcasts and special programs for the 2026 World Cup-hosted by Canada, Mexico, and the United States.
Speaker #3: We built comprehensive content and marketing products around the tournament. Our original sports content IP generated more than 75 million impressions. Across the wide, attracted over 10 leading brands and achieved significant commercial growth.
Speaker #3: In addition, our reporting on the Shanxi Qinyuan Mountain accident demonstrated our investigative capabilities and journalistic expertise in major public events. With multiple exclusive stories being republished by mainstream media, our original content IPs continue to demonstrate long-term value.
Speaker #3: Programs such as Journey and Endless Conversations have built strong audience engagement and brand influence through authentic storytelling and in-depth conversations. We believe premium branded content creates value beyond product promotion, by connecting brands with meaningful social issues, and compiling stories.
Speaker #3: Our flagship interview IP, 舍得WisdomTalk, has operated for eight seasons and maintained eight consecutive years of brand partnerships. The advertiser base of this premium IP has expanded from traditional liquor brands into industries such as automobiles and technology, demonstrating that strong content IPs are not only effective audience acquisition tools, but also long-term commercial assets with repeat monetization potential.
Speaker #3: As our content capabilities continue to build commercial value, it's being unlocked across key verticals. Following the shift toward more in-depth original vertical videos, on WeChat channels, our tech channel achieved quarterly revenue growth of over 100% year over year.
Speaker #3: Our iPhone car research lab established differentiated expertise with potential content such as Xiaomi EV, SAD Airbag Testing, and delivered strong revenue growth through event marketing around the Beijing Auto Show.
Speaker #3: Meanwhile, our large-scale event IPs also performed well. The Her Power Weibo topic approached 200 million reads, and the Greater Bay Area Finance Forum achieved over 100 million impressions and was republished by industry organizations.
Speaker #1: Channels: Our tech channel achieved quarterly revenue growth of over 100% year over year. Our iPhone card research lab established differentiated expertise with potential content such as Xiaomi EV and said airbag testing, and delivered strong revenue growth through event marketing around the Beijing Auto Show.
Speaker #3: AI is now integrated into our content workflow. We use AI to support content preparation, production, and post-production. This allows us to maintain high-quality while improving efficiency and optimizing costs.
Speaker #3: We are also enhancing content distribution user reach and operational precision to maximize content value and commercial conversion. Looking ahead, our priorities remain clear: continue investing in trusted content, deepen the use of AI across our workflow, expand monetization opportunities in key verticals, and strengthen the connection between our content capabilities and commercial value.
Speaker #1: Meanwhile, our large-scale event IPs also performed well. The Her Power Weibo topic approached 200 million reads, and the Greater Bay Area Finance Forum achieved over 100 million impressions and was republished by industry organizations.
Speaker #1: AI is now integrated into our content workflow. We use AI to support content preparation, production, and post-production. This allows us to maintain high quality while improving efficiency and optimizing costs.
Speaker #3: We believe this effort will further reinforce Phoenix's position as a trusted media company and support sustainable long-term growth. This concludes our CEO, Mr. Li's prepared remarks.
Speaker #1: We are also enhancing content distribution, user reach, and operational precision to maximize content value and commercial conversion. Looking ahead, our priorities remain clear: continue investing in trusted content, deepen the use of AI across our workflow, expand monetization opportunities in key verticals, and strengthen the connection between our content capabilities and commercial value.
Speaker #3: I will now walk you through our financial performance for the second quarter of 2026. All figures mentioned will be in R&B. Our total revenues, or 216.7 million, representing a 15.8% increase year-on-year from 187.1 million.
Speaker #3: Specifically, net advertising revenues were 146.9 million, compared to 153.3 million in the same period of last year. Paid services revenues were 69.8 million, representing a 106.5% increase year-on-year from 33.8 million.
Speaker #1: We believe this effort will further reinforce Phoenix's position as a trusted media company and support sustainable, long-term growth. This concludes our CEO, Mr. Li's, prepared remarks.
Speaker #3: Primarily driven by revenue generated from our digital reading services offered through mini programs on third-party applications. Cost of revenues decreased by 2.6% to 92.6 million, from 95.1 million in the same period of last year.
Speaker #1: I will now walk you through our financial performance for the second quarter of 2026. All figures mentioned will be in RMB. Our total revenues were RMB 216.7 million, representing a 15.8% increase year on year from RMB 187.1 million.
Speaker #3: Gross margin for the second quarter improved to 57.3% from 49.2% in the same period of last year. Total operating expenses were 129.4 million, reflecting a 30.4% increase year-on-year from 99.2 million.
Speaker #1: Specifically, net advertising revenues were $146.9 million, compared to $153.3 million in the same period last year. Paid services revenues were $69.8 million, representing a 106.5% increase year on year from $33.8 million.
Speaker #3: This increase was primarily due to higher sales and marketing expenses, incurred for the digital reading services mentioned earlier. Loss from operations were 5.3 million, compared to 7.2 million in the same period of last year.
Speaker #1: Primarily driven by revenue generated from our digital reading services offered through mini programs on third-party applications. Cost of revenues decreased by 2.6%, to $92.6 million from $95.1 million in the same period of last year.
Speaker #3: Net income attributable to iPhone was 6.5 million, compared to net loss attributable to iPhone of 10.4 million in the same period of last year.
Speaker #1: Gross margin for the second quarter decreased to 37.3% from 49.2% in the same period last year. Total operating expenses were $129.4 million, reflecting a 30.4% increase year on year from $99.2 million.
Speaker #3: Moving on to our balance sheet. As of June 30, 2026, the company's cash deposits, short-term investments, and restricted cash totaled 990 million, or approximately USD 145.9 million.
Speaker #1: This increase was primarily due to higher sales and marketing expenses incurred for the digital reading services mentioned earlier. Loss from operations was $5.3 million, compared to $7.2 million in the same period last year.
Speaker #3: Finally, I'd like to provide our business outlook for the third quarter of 2026. We forecast total revenues to be between 220.9 million and 235.9 million.
Speaker #1: Net income attributable to iPhone was $6.5 million, compared to a net loss attributable to iPhone of $10.4 million in the same period last year.
Speaker #3: For net advertising revenues, we project between 151.9 million and 161.9 million. While for paid service revenues, we project between 69 million and 74 million.
Speaker #1: Moving on to our balance sheet. As of June 30, 2026, the company's cash and cash equivalents, term deposits, short-term investments, and restricted cash totaled RMB 990 million, or approximately USD 145.9 million.
Speaker #3: This forecast reflects our current and preliminary view, which is subject to change and substantial uncertainties. This concludes the prepared portion of our call. We are now ready for questions.
Speaker #1: Finally, I'd like to provide our business outlook for the third quarter of 2026. We forecast total revenues to be between $220.9 million and $235.9 million.
Speaker #3: Operator, please go ahead.
Speaker #1: Thank you very much. As a reminder, to ask a question, please press star 11 on your telephone and wait for your name to be announced.
Speaker #1: For net advertising revenues, we project between $151.9 million and $161.9 million, while for paid service revenues, we project between $69 million and $74 million.
Speaker #1: To withdraw your question, please press star 11 again. Please stand by as we compile the Q&A roster. First question comes from Alexander, Lu, from First Shanghai.
Speaker #1: This forecast reflects our current and preliminary view, which is subject to change and substantial uncertainties. This concludes the prepared portion of our call. We are now ready for questions.
Speaker #2: Thanks, management. For taking my question and congratulations on for this quarter's achievement. So my question is related with advertising. So the company achieved year-on-year revenue growth this quarter so we are looking at the advertising business more broadly.
Speaker #1: Operator, please go ahead.
Speaker #2: Thank you very much. As a reminder, to ask a question, please press star 11 on your telephone and wait for your name to be announced.
Speaker #2: The picture seems more nuanced. Can you walk us through the dynamics, what's creating pressure, and what's giving you all confidence? And how you see the near-to-medium-term trajectory?
Speaker #2: To withdraw your question, please press star 11 again. Please stand by as we compile the Q&A roster. The first question comes from Alexander Lou from First Shanghai.
Speaker #3: Thank you, Alexander. The advertising environment was mixed, this quarter. In some categories, such as Chinese liquor, the timing of certain contract renewal for outside Q2, which had an impact on the quarter, but we don't see any fundamental change in the underlying demand.
Speaker #3: Thank you, management, for taking my question, and congratulations on this quarter's achievement. My question is related to advertising. The company achieved year-on-year revenue growth this quarter, so we are looking at the advertising business more broadly.
Speaker #3: At the same time, we saw growth in several other areas. It's coming from a deeper vertical content, event-based campaigns like help brands reach a larger audience, and branded content IPs like support long-term client relationships.
Speaker #3: The picture seems more nuanced. Can you walk us through the dynamics—what's creating pressure, what's giving you all confidence, and how you see the near- to medium-term trajectory?
Speaker #1: Thank you, Alexander. The advertising environment was mixed this quarter. In some categories, such as Chinese liquor, the timing of certain contract renewals fell outside Q2, which had an impact on the quarter, but we don't see any fundamental change in the underlying demand.
Speaker #3: We are seeing this models work across a range of categories, including technology, automotive, finance, and consumer brands. So we believe this is more of a structural shift rather than just a short-term thing.
Speaker #3: Going forward, we think that content-driven monetization will be an important area of growth. Our focus is to expand the models that have worked well for us, build relationships with clients, who see things as a content partner rather than just a media channel.
Speaker #1: At the same time, we saw growth in several other areas. It's coming from deeper vertical content, event-based campaigns that help brands reach a larger audience, and branded content IPs that support long-term client relationships.
Speaker #3: We are also expanding into new advertiser segments where our lightweight, fast-turn campaigns have proven effective. I hope I have answered your questions, Alexander. Thank you again.
Speaker #1: We are seeing these models work across a range of categories, including technology, automotive, finance, and consumer brands. So we believe this is more of a structural shift rather than just a short-term thing.
Speaker #1: Thank you. I see no further questions at this time. I will now turn the conference back to Mu Zi.
Speaker #1: Going forward, we think that content-driven monetization will be an important area of growth. Our focus is to extend the models that have worked well for us and build relationships with clients who see us as a content partner, rather than just a media channel.
Speaker #4: Thank you. This concludes our Q&A session and conference call. If you have any further questions, please feel free to contact us. Thank you for joining us, and have a great day.
Speaker #1: We are also expanding into new advertiser segments, where our lightweight, fast-turn campaigns have proven effective. I hope I have answered your questions, Alexander. Thank you again.
Speaker #2: Thank you. I see no further questions at this time. I will now turn the conference back to Mu Zi.
Speaker #3: Thank you. This concludes our Q&A session and conference call. If you have any further questions, please feel free to contact us. Thank you for joining us, and have a great day.
