Cheetah Mobile Inc.

Welcome to the Cheetah Mobile fourth quarter and full year 2020 earnings conference call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note, this event is being recorded. I would now like to turn the conference over to Helen Hsu, Investor Relations Director of Cheetah Mobile. Please go ahead, ma'am.

Thank you, operator. Welcome to Cheetah Mobile's fourth quarter and four-year 2020 earnings council call. With us today are our company's chairman and CEO, Mr. Fu Sheng, and our company's CFO, Mr. Thomas Jin. Fully in management's prepared remarks, we will conduct the Q&A session. Before we begin, I refer you to the safe harbor statement in our earnings release, which also applies to our conference call today, as we will make forward-looking statements. At this time, I would now like to turn the conference call over to our CEO and Chairman, Mr. Fusheng. Please go ahead, Fusheng.

Thank you, Helen. Hello, everyone. While the macro environment remains challenging, with focus and determination, Trader Mobile improves operational efficiency, verified our revenue streams beyond advertising, and stayed focused on domestic markets. In 2020, we earned RMB 1.6 billion in revenue and RMB 417 million in net income attributable to our shareholders. and our business began to take hold. Meanwhile, we remained committed to our AI-related robotic business to build sustainable growth for Cheetah Mobile in the long run. Here are the operating highlights. First, we cut our costs and expense. As a result, long gap operating loss continued to narrow since Q4. In the fourth quarter of 2020, non-GAAP operating loss was RMB 57 million, reduced from RMB 204 million in the same period last year and RMB 190 million in the previous quarter. Specifically, our Internet business earned about RMB 76 million. in non-GAAP operating profit in the fourth quarter of 2020. Compared to an operating loss of RMB 92 million in the same period last year, and operating profit of RMB 71 million in the previous quarter, thanks to our continued operating optimization China Mobile still holds US$255 million at hand, despite that we paid US$200 million cash dividends to our shareholders in 2020. Looking ahead, we will continue to cut our costs and expense and improve operating efficiency. Second, through offering membership service within our utility products, we diversified our revenue streams beyond advertising in 2020. We put user experience, user satisfaction, and our user privacy protection as our top priority in our whole market. Our goal is to improve the user retention rate and attract more users through word of mouth. In the domestic market, we continue to encourage users to subscribe for an ad-free experience. Such initiative helped us reduce reliance on advising and allow our utility product to deliver a superior experience. As a result, both paying user count and subscription revenue continue to grow in 2020. And we expect this metric to continue to grow in the future. Supported by the membership service and our efforts on enhancing our user experience, we expect revenue from our key internet business to gradually stabilize and resume quarter-over-quarter growth in the coming quarters. Third, we optimized optimize our operation for our AI business by focusing on a selected number of use case. One of them is deploying our AI robots in shopping malls. COVID-19 in China has been well controlled and this Chinese economic has recovered. Our AI related robots can help shopping mall operators better serve their customers and help brands and shops promote their products and services. While our AI business is still in its early stage, we believe we are on the right direction of our business. Before I turn the call to Thomas for financial highlights, I would like to emphasize our cash reserves and our confident shareholder returns. In 2020, we will continue to cut our cost and expense and experiment more monetization models for our AI business to rebuild a sustainable growth model for the long term. With that, I will now turn the call to our sales Thomas Ren, to go through the details of our fourth quarter financial results.