Sohu.com Limited

Ladies and gentlemen, thank you for standing by and good evening. Thank you for joining SOHO's fourth quarter 2022 earnings conference call. At this time, all participants are in the listen-only mode. After management's prepared remarks, there will be a question and answer session. Today's conference call is being recorded. If you have any objections, you may disconnect at this time. And I'd like to turn the conference over to your host for today's conference call, Huang Pu, Investor Relations Director of Sohu. Please go ahead.

Thanks, operator. Thank you for joining us to discuss Sohu's first quarter 2022 results. On the call are Chairman and the Chief Executive Officer, Dr. Charles Zhang, CFO Joanna Liu, and Vice President of Finance, James Dunn. Also with us are Chang-Yu Seo, Do Wen Chen, and CFO Albin Wang. Before management begins their prepared remarks, I would like to remind you of the company's safe harbor statement in connection with today's conference call. Except for the historical information contained herein, the matters discussed on this call may contain forelooking statements. These statements are based on current plans, estimates, and projections, and therefore you should not place undue reliance on them. Forelooking statements involve inherent risks and uncertainties. We caution you that A number of important factors could cause actual results to differ materially from those contained in any forwarding statements. For more information about the potential risks and uncertainties, please refer to the conference's filings with the Securities and Exchange Commission, including the most recent annual report on Form 20-F. With that, I will now turn the call over to Dr. Charles Zhang. Charles, please proceed.

Thanks, Feng. Thank you, everyone, for joining our call. In the fourth quarter and full year of 2022, we continue to refine our products and optimize operating efficiency with strict budget control. Despite the massive impact of COVID-19 and the macroeconomic challenges, thanks to our efforts, brand advertising revenue and bottom line performance both exceeded our prior guidance for the fourth quarter of 2022. At Soho Media Portal, we continue to dedicate ourselves to improving user experience by providing richly premium content and making significant improvements in both product and technology. At Soho Video, based on our team engine strategy, we continue to develop both original content and the science-based live broadcasting with our advanced live broadcasting technology. Meanwhile, we proactively explored a range of monetization opportunities with our differentiated content marketing campaigns. Online games delivered stable performance, revenue in line with our prior guidance. I'll go into detail about each of these businesses in a moment, but first, a quick overview of our financial performance. For the fourth quarter of the year, 2022, total revenues $160 million, down 17% year-over-year, and 13% quarter-over-quarter. Brand advertising revenues were $29 million, down 14% year-over-year, and up 12% quarter-over-quarter. Online game revenues, $121 million, down 16% year-over-year, and 18% quarter-over-quarter. Gap net loss attributable to SOFO.com Limited was... $7 million compared with an income of $4 million in the first quarter of 2021 and net loss of 22 million in the third quarter of 2022. Non-GAAP net loss attributable to Zoom.com Limited was $2 million compared with the net income of $0.2 million in the fourth quarter of 2021 and a net loss of $17 million in the third quarter of this year, of 2022. For the full year of 2022, total revenues, $734 million, down 12% compared with 2021. Brand advertising revenues, $103 million, down 24% compared with 2021. Online game revenues, $585 million, down 8% compared with 2021. Gap net loss attributed to Pursuit.com. was $17 million compared with the net income of $69 million in 2021. Not having that income attributable to Soho.com Limited was $2 million income compared with the net income of $79 million in 2021. So now let me go through our key business in more detail. First Media Portal and Soho Video. At Soho Media Portal, during 2022, we upgraded algorithms, technologies, and products through refinements to each work hard at improving our user experience and keeping users engaged by offering a wide range of premium content and the self-media content and also their social distribution We kept strict control of budget and made a continuous improvement in operating efficiency. With these efforts, we were able to further reinforce our reputation as a mainstream media platform by leveraging our advanced live broadcasting technology and rich media resources. At Video, we focused on our twin-engine strategy by providing compelling content in both long and short form. We launched several original dramas and reality shows, including Ye Cheng Fu, and the fifth season of our On Her Way Home, the fifth season. Audiences were enthusiastic about both of these. We have several new original dramas in our pipeline to be released in coming quarters. In terms of short-form content, we launched a successful series of science-related live broadcasting during the year, including the highly regarded IP of my . Charles Physics class, which I taught online. This IP has drawn significant attention and attracted hundreds of leading professional broadcasters in a variety of fields, consolidating, yeah, attracted hundreds of leading professional broadcasters and influencers in a variety of fields, consolidating our reputation as a leading science and knowledge-based live broadcasting platform, and also not only live broadcasting, but short-form, short video platform. On the monetization side, the COVID-19 pandemic and the microeconomic uncertainties have negatively impacted the whole market. Even under these conditions, we explore new application scenarios using our advanced and live broadcasting technology, benefiting from our unique IPs and continue to host traditional flagship events as well as unique and innovative content marketing campaigns. For example, these events and campaigns provide us with great premier content, at the same time strengthen our brand influence and brought us new and significant financial opportunities. In 2022, we successfully hosted the Soho News Marathon, a traditional IT, and Soho Finance Annual Conference, the Talk Under Starry Sky, a new program, and others. This quarter, we hosted in fantastic factories tailored to an advertiser, which not only drew a significant attention across media platforms, but also consolidated SOHO's competitive brand advantages and captured the advertiser's budget. Now turning to online game business, during the fourth quarter of 2022, online game revenues were in line with the company's prior guidance In our business line for PC games, we adjusted the battlefield map and the gameplay of regular TLBB PCs, cross-server, clan, or system. We launched a new expansion pack for TLBB Vintage to celebrate its anniversary with the expedition of its first new clan. In mobile games, we introduced a survival mode PvP event for Lexi TLBB Mobile. In the first quarter of 2023, to keep players engaged, we will launch expansion packs to celebrate Chinese New Year and a series of holiday events for TLBV PC, like TLBV Mobile and other games. As demand in the online games market becomes deeper and more diversified, We intend to stick with our top game strategy by promoting professional talent development as well as innovation in content technology and roll out more high-quality mobile games of different types. In terms of game pipelines, while maintaining our core competitiveness in MMORPGs, we will also invest in more games of multiple types, including card RPGs, strategy, sports, and idle games. I'll turn the call to Joanna or CFO, who will walk you through our financial results.