JOYY Inc.

Ladies and gentlemen, thank you for standing by and welcome to Julie Inc.' 's first quarter 2025 earnings call. At this time, all participants are in listen-only mode. After the management's prepared remarks, there will be a question and answer session. I'd now like to turn the conference over to your host today, Jane See, the Company's Senior Manager of Investor Relations. Please go ahead, Jane.

Thank you, Operator. Hello, everyone. Welcome to Joy's first quarter 2025 earnings conference call. Joining us today are Ms. Ting Lee, Chairperson and CEO of Joy, and Mr. Alex Liu, the Vice President of Finance. For today's call, management will first provide a review of the quarter, and then we will conduct a Q&A session. The financial results and webcasts of this conference call are available at ir.joy.com. A replay of this call will also be available on our website in a few hours. Before we continue, I would like to remind you that we may make forward-looking statements, which are inherently subject to risk uncertainties that may cause actual results differ from our current expectations. For detailed discussions of the risk uncertainties, please refer to our latest annual report on Form 20F and other documents filed with the SEC. We will also discuss certain non-GAAP financial measures. They are included as additional clarifying items to aid investors in further understanding the company's performance and the impact that these items and events had on the financial results. The non-GAAP financial measures provided above should not be considered as a substitute for or superior to the measures of financial performance prepared in accordance with GAAP. You may find a reconciliation of the differences between GAAP and non-GAAP financial measures in our earnings release. Finally, please note that unless otherwise stated, all figures mentioned during this conference call are in U.S. dollar. I will now turn the call over to our chairperson and CEO, Ms. Ting Li. Please go ahead, Ms. Li.

Hello, everyone. I'm Li Ting. Welcome to our fourth quarter 2025 earnings call. 2025 makes a key milestone for both Joy and for me personally. Joy has just celebrated its 20th anniversary, growing into a global technology leader with a sizable, engaged user base worldwide. We diversified Joy's strategy, ensuring clear results, as non-live streaming revenue continues to expand rapidly, affirming the strength of our business model. As 2025 makes my first complete fiscal year as CEO, I'm excited to outline our media to long-term strategic vision and operational roadmap as we advance into our next decade of growth. First, looking at our quarterly performance. We recorded total revenue of $494 million in the first quarter of 2025. Our non-let streaming revenue reached $123 million. A year-over-year increase of 25.3%, with non-let streaming revenue accounting for 25% of the group's total revenue for the first time. In the fourth quarter, we achieved a non-GAAP operating profit of $31 million, a year-over-year increase of pro-costing metering 25%. Meanwhile, we maintained strong operating cash flow, which reached $58 million. During the fourth quarter, we distributed approximately $49.1 million in dividends to shareholders. On top of that, we repurchased approximately $22.5 million worth of our shares as of May 23, reinforcing our commitment to returning value to our shareholders. In the past, we focused on expanding the global reach and the influence of our user community, leveraging our diverse portfolio of products, spanning live streaming, short videos, instant messaging, and more. We have successfully monetized our global user base through live streaming and delivered consistent profitability, which demonstrates our industry insight, operational, agility, and strong execution. Over the past two years, we have stepped up our innovation to develop new revenue streams, achieving significant progress toward our growth objectives of cultivating a multi-faceted ecosystem. Since 2024, our global programmatic advertising platform, BiggerAce, has achieved remarkable growth. Capitalizing on our sensible global user base of approximately 260 million users, present military, young and middle-aged Internet users, with promoting purchasing power, we have attracted a growing number of advertisers. Google Ads has further expanded its traffic pool by integrating premium publisher traffic with our first-party traffic, consistently delivering strong, memorable results for the advertisers. This success has fueled the rapid expansion of our advertising revenue, reinforcing our confidence to further diversify and expanding our ecosystem. Looking at the full picture of our non-live streaming businesses, we believe that our advertising platform and smart commerce SaaS platform are also strategically complementary, driving synergy across an ecosystem as bigger aids expand its traffic pool and enhances its data-driven testing capabilities. It will empower merchants to scale its market presence through pieces and efficient customer targeting. This integrated approach generates significant value across our ecosystem and created a virtual circle of growth for both bigger A's and our smart commerce platform. Looking forward, we anticipate our non-live streaming businesses, including our advertising and smart commerce platform, will emerge as Joy's second growth entry. Our initial accomplishments in these areas have been encouraging, and I'm confident that this multi-agent approach will establish a sustainable long-term growth roadmap for Joy that will deliver major lasting value and enhanced returns for our shareholders. Next, let me share with you our latest business update and operational strategies. First, our live streaming business. In the fourth quarter, the group's live streaming revenue was $371 million, with Beagle contributing $352 million, in line with our expectations. At present, we observe distinct regional divergence in online entertainment spending. Specially, users in developed markets have shown red lines, while those in emerging economics and long-tail paying users have reduced spending due to economic headwind. To address sanctions, we've adopted prudent strategies and efficient operational resource allocation. First, we are continuously optimizing our user acquisition strategy by prioritizing advertising spent on higher-quality paying users in call markets. Second, we are fraternizing our renew-sharing machines, particularly by underperforming agencies and channels that fail to deliver positive ROI. And third, we continue to strengthen our community content safety measures while improving content operations to boost user engagement. These strategic changes have already brought constructive results. While lab stream revenue has fluctuated comparatively, we have achieved a significant improvement in operating profit from our flagship product, Big Alive. Despite this transitional phase, we remain confident in the fundamental interactive value that live streaming can offer to users and its monetization sales potential. To re-accelerate growth, our strategy focuses on two actionable points. First, we will continue to optimize resource allocation based on ROI and improve traffic quality prioritizing user growth in core markets such as developed countries and the Middle East. Second, we will drive content, product features, and operational innovations to boost user engagement, improve paying users' experiences, and increase conversion rates. But better identifying quality users and improving payment conversion. We expect a regurgence in high-quality paying users, stabilizing live streaming revenue, and driving renewed growth. Next, let's look at the performance of our core product across key markets. In the fourth quarter, live streaming revenue in developed countries continued to outperform. In particular, Big O Live's North American region saw Q1 MAU growth exceeding 7% year-over-year. At the same time, the number of paying users in the region increased by approximately 4% QOQ. Next, the Middle East region. Remedies in 2025 started earlier this year, with the entire month falling within the fourth quarter, which caused expected seasonal impacts. Even so, our products actively promoted a series of operational activities which drove regional user activity and helped boost our brand influence among our users. In the long run, the Middle East market continues to be one of our strategic priorities, given its strong monetization potential as demonstrated by top tier approved and users from Xfinity for interactive live streaming and high engagement. We have remained a leader in the market and we are committed to defending our penetration in the Middle East through our expanding device product portfolio. Looking at product improvements, our teams have made important product feature updates that are creating clear operational benefits. In the first quarter, BeagleLive launched an entirely redesigned VIP benefits system and improved its gifting experience, upgrading gift features for high-value units. These efforts delivered a 3% QoQ increase in approval among Big O Live's high-end user cohorts. LIPE also advanced its content strategy by building a more diverse and engaging content library. This led to impressive engagement metrics during the quarter. Videos viewed per user rose by 7% compared to the previous quarter, with overall video consumption time increasing by 10% over the same period. Our refined approach to top streamer management and development also produced a notable 3% QQ increase in Likey's average paying ratio during the quarter. In the fourth quarter, Beagle achieved approximately $18 million in advertising revenue, a year-over-year growth of about 27%. I would like to share my insights into the macro and industry changes in the advertising business and how we plan to establish our long-term competitive advantage in advertising in the current environment. As you see, we believe Joy's unique position to take advantage and current conditions of the advertising space to drive our long-term growth. First, the global macro landscape is highly dynamic, with major shifts taking place to advertising placement channels across key markets. Advertisers need placement strategies spanning both dynamic and international channels to maintain and grow their market share. This change actually favors organizations with our unique profile, specifically those with both strong localized operations and extensive global reach. As such, we believe Joy benefits clearly from these recent shifts in the advertising landscape. Our market insights, premium global traffic, and localized opposition have helped us build strong credibility with advertisers. This chart has allowed our bigger aid platform to grow quickly. which has increased both our managed traffic volume and overall platform scale. Second, in this evolving landscape, advertisers now demand better returns from their placements, along with clearer measurement and proof of placement impact. Specifically, they want to directly connect their ad cost to revenue and profit growth. This means that more than ever before, platform must find and engage specific audience segments and efficiency turn these interactions into mirrorable new customers. Joy is unique positioned to meet these changing needs with our large user base of 260 million people worldwide. Our users include the key target groups for many important advertising categories, and we understand their behaviors and preferences deeply. This creates an advertising system with detailed user profiles that helps advertisers consistently reach their most valuable customers. Third, we are leveraging AI to transform our advertising strategy. The rapid advancement of AI technologies and Infrastructure has greatly enhanced Joy's capabilities, enabling us to capitalize on our diverse applications, scenarios, and proprietary data assets. Beagle 8 uses our extensive global audience and years of quality data to build its own virtual model. integrating cutting-edge generative AI technologies. This has helped us build an intelligent end-to-end advertising platform that covers user insights, creative development, precise packaging, and real-time optimization. Our AI usage improves ad performance and ad returns, while creating better revenue opportunities for our publisher partners. This success attracts both more advertisers spending and more publisher traffic, helping the Big O 8 platform grow quickly. Fourth, our advertising business enjoys significant economic advantages. thanks to our established global operational team, R&D capabilities, and our network infrastructure. In particular, bandwidth and network-related expenses, a key component of operating cost and advertising platform, are optimized through our global network infrastructure originally, but built for our social and entertainment products. This allows bigger ads to enjoy significant cost savings. As our advertising business scales, our server cost per unit decrease cause the company steadily enhance overall operational efficiency. In summary, our advertising business has delivered a consistently strong growth in the past quarter and continues to be profitable to the company. This success comes from our local operations, our advertisers and user base, our industry-leading algorithms, and our global network infrastructure. Given this province strength and our growing market position, we are confident our advertising business will continue to contribute to growth in our revenue and profitability over the long term. Now, moving to our thoughts on capital allocation. With the preliminary, progress that we made divisible our businesses. We are actively monitoring our business development and resources and carefully assessing long-term capital allocation opportunities to support our non-leg-streaming businesses. In short term, we expect prudently expand the hand-calls and marketing resources to support our advertising business while maintaining healthy profit margins. In the medium to long term, once our non-live streaming business reaches a certain scale, investment in infrastructure upgrades, technology development, talent in bank expansion, and marketing efforts are all potentially high return capital allocation options. We aim to extend our competitive advantages through efficient capital use. On shareholder returns, Joy has established a consistent track record of delivery returns to our investors. Looking forward with our live streaming business, stabilizing under the rising revenue and profit from advertising and other emerging businesses, we expect the company's consolidated operating profit to continue to improve, and our shareholders to benefit from our long-term profitable growth. We remain deeply committed to disciplined capital allocation and balanced strategic reinvestment with competitive shareholders' return. In short, we are currently experiencing a strategic transition in joint business structure and reshaping our resource allocation, focusing on high-quality organic growth with the rapid advancement in our non-live streaming businesses. We expect 2025 will be a year of implementation and validation of our multi-growth energy strategy. I'm confident that our focus on value-adaptive organic growth will drive expanding business and financial benefits, ultimately creating lasting values for our shareholders. I will now turn the call over to Mr. Aslu, the Vice President of Finance, to provide our financial updates.