JOYY Inc.

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

Thank you, Operator. Hello, everyone. Welcome to Joy's fourth quarter and four-year 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. The 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, including but not limited to the future development of our products and businesses, the expected future financial performance of the company, our shared purchases, and other future events which are inherently subject to risks and uncertainties that may cause actual results to differ from our current expectations. For detailed discussions of the risks and uncertainties, This refers to our latest annual report on Form 20F and other documents filed with the SEC. We will also discuss certain non-GAAP financial measures that 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 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.

Hello, everyone. I'm Li Ting. Thank you for joining us today. In 2025, our group revenue and social entertainment business regained growth momentum since Q2. And we saw meaningful progress in our second growth curve of Aztec and other emerging areas. Together, these results are shaping our clear strategic framework as a global technology company with multiple growth engines. Let me start with the overview of our results. In Q4, live streaming maintained its sequential recovery trend, while our advertising platform saw accelerated top-line growth. Meanwhile, non-GAAP operating profit and cash flow remained robust. In the fourth quarter, total revenue reached $581.9 million. up 7.7% QQ and 5.9% YoY, representing our first positive YoY growth since the second half of 2024. Livestreaming revenue was 394.4 million, up 1.5% QQ. Marking three consecutive quarters, of sequential growth. Legal aid, including both first- and third-party aid, generated 128.1 million in revenue, up 61.5% year-to-year, with third-party audience network revenue growth accelerating to 82.5% year-to-year. Overall, non-livestreaming business contributed 32.2% of total group revenue. Now GAAP operating profit stood at 40.8 million and operating cash flow totaled 116 million. For the full year, total revenue was 2.12 billion. Livestreaming contributed 1.53 million. Well, BiggerAIDS contributed $398.5 million, up 38.5% year-to-year. In particular, BiggerAIDS third-party AIDS revenue audience network delivered 56.3% year-to-year growth. Non-live streaming businesses represented 28% of total revenue, an increase of 7.9 percentage point compared with 2024. In 2025, non-GAAP operating income and non-GAAP EBITDA were $150.8 million and $189.8 million, up 10.8% and 10.9% year-to-year, respectively. As of December 31, we held $3.26 billion in net cash. Our strong operating cash flow and balance sheet continue to support consistent shareholder returns. In 2025, we returned $332 million through shares, repurchases, and dividends. With improved business visibility and ongoing occupational optimization, we are confident we will continue to deliver solid performance. In light of our strong performance and continued to double-digit non-GAAP occupational profitability improvements in 2025, the Board has approved an additional cash dividend of approximately U.S. $20 million, representing approximately 10% of the total cash dividends declared for the year of 2025, on top of companies' regular quarter dividend schedule. This demonstrates our ongoing commitment to drive occupational improvement and enhance shareholder returns, Next, let me share our strategic forecast on Outlook. We are currently evaluating refinements to our segment reporter structure, and we are considering to report our results on the three major business segments. Social engineering, ad tags, and e-commerce starts beginning since the first quarter of 2026. This new structure will make it easier to see and understand the progress we make within each business. Our social entertainment business remains the cornerstone of our profitability and cash flow. Meanwhile, bigger ads and shoplights are filling our next stage of growth with improving need to long-term economics and expanding profitability potential. Together, these businesses position Joy for a return to sustainable and profitable growth. From a long-term perspective, their combined strengths and synergies will serve as an unserved engine through which we can eventually penetrate an adjustable market beyond what would be possible for each business individually. We believe 2026 will be a landmark year for Joy. the resolute beginning of our renewed growth journey and the defining step toward becoming a global diversified multi-engine technology company. Now, let's turn to our operating update. In Q4, our core social entertainment business achieved its third consecutive quarter of sequential recovery. Global social MLS reached 272.1 million, up 2.2% quarter over quarter. Traffic from our instant message increased 4.5% QQ, driven by high user thickness and user organic growth. Both average user time spent and retention improved year-to-year. On the revenue side, the black streaming revenue rose to $300 million and $94.4 million, up 1.5% QQ. The Western market recorded a strong recovery. with revenue climbing 3.4% QQ. Biggest total paying dozer rose 1.5% QQ. On our current four flagship products, we further enhanced our streamer incentive structure and integrated AI-driven features across critical stage of the user journey, boosting both engagement and payment efficiency. For example, by integrating LLM architecture and incorporating multi-model information into our recommendation system, we improved our ability to understand both live streaming content and the user interest. The optimized recommendation position and distribution efficiency led to a 5.6% QQ increase in video live average viewing time per user in Q4. Furthermore, user adoption of AI-generated vertical gives continues to grow. As of January 2026, the consumption of AI interactive GIFs on BeagleLive has surpassed 30% of total word code GIFs consumption. We are making solid progress on our new product lineup. Leveraging our established capabilities in product development, content, payments, infrastructure, and local operations. We are expecting new product incubation and growth. In Q4, revenues from new products increased 37.9% Q2, setting new monthly record. In 2026, We expect continued recovery of paying users of our pool for our flagship products. Driven by ongoing occupational refinements, meanwhile, we anticipate our new product lineup will sustain robot growth and bring further incremental live streaming revenue. We are confident our social entertainment segment will regain growth momentum, deliver healthy profitability and cash flow for the group. Turning to Big O Aids, in Q4, Big O Aids delivered $128.1 million in advertising revenue, exceeded 1.5% year-to-year and 23.3% QQ. third-party aid revenue, audience network grew 82.5% yearly and 27.3% QQ. Demonstrating accelerated growth momentum on the sequential basis for the third consecutive quarter. We filled this growth through border traffic coverage multi-vertical advertiser expansion, and ongoing algorithm optimization. First-party traffic expanded steadily, supported by higher MAOS, and at a few rates that drove sequential revenue and profit growth. Third-party traffic also increased, with FDT requests growing by 166% year-to-year and 23% QQ. Our diversified vertical strategy across insurance, e-commerce, and IAA games broadened market coverage and allowed us to capture seasonal advertising demands more effectively. 2004 was the peak season for U.S. insurance advertising and the prime outright for e-commerce campaigns such as Black Friday, web-based, demand primarily from insurance, and D2C e-commerce advertisers grew 20%, contributing to a boost in revenue. Enhanced placement performance led the IAA vertical, primarily casual games, to a 39% sequential increase. Overall, the number of key cohorts increased by 29% and the total spending of key cohort clients 34%. By writing, we believed the market continued to be our priority. with North America up over 21% QQ and Western Europe rising 46% QQ. To take advantage of society momentum, we will deepen our presence in key protocols, including lead generation aid, e-commerce, and games. This multi-vertical approach will serve as our structure and this relative competitive edge over the mid to long term. And currently, we will extend our advertiser base and penetrate deeper into development countries while continuously optimizing our algorithm. We have established a three-year roadmap for the bigger audience network, targeting a revenue milestone of one billion by 2028, accompanied by steady improvements in economics. Finally, a word on shop life. Beginning in 2026, we are considering to report Shopline as a separate business segment to reflect our confidence in its growth prospects. Over the past year, Shopline maintained double-digit revenue growth. Driven by the cross-border merchant basis, its double-digit expansion and its rising contribution to revenue. we have normalized the shop line's IMD spending. Backed by steady top line and growth profit gains, we see a clear and achievable path for shop line. To reach quick even, we are searching a double-digit revenue growth trajectory. Turning to capital return, in Q4, we repurchased 67.4 million of shares. For the four years, total repurchases reached 134.6 million, with momentum accelerating in the second half. We believe our current valuation does not fully reflect our intrinsic value. We remain committed to actively analyzing our buyback programs. Looking ahead, as we continue to scale our business and strengthen our operating profitability, we will work closely with the board to explore possible measures to further enhance our shareholders' return mechanisms. In summary, our strategic blueprint and ecosystem potential are only beginning to unfold. We view 2026 as a fresh start toward our next phase of growth. We remain focused on execution and we are confident that sustained growth and the profitability improvements will demonstrate our true value. Leveraging our integrated ecosystem, we remain committed to strengthen joint position and deliver a long-term value for our shareholders. Now, let's begin from Alex Liu.