Youdao, Inc.

Good day and welcome to YoDAO's fourth quarter 2025 and full year earnings conference call. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Jeffrey Wang, Investor Relations Director of YoDAO. Please go ahead.

Thank you, operator. Please note the discussion today will contain forward-looking statements related to the future performance of the company. which are intended to qualify for the safe harbor from viability as established by the U.S. Private Securities Litigation Reform Act. Such statements are not guarantees of the future performance and are subject to certain risks and uncertainties, exceptions, and other factors. Some of these risks are beyond the company's control and could cause actual results to differ materially from those mentioned in today's press release and this discussion. A general discussion of the risk factors that could affect UDAO's business and financial results is included in certain company filings with the U.S. Securities and Exchange Commission. The company does not undertake any obligation to update this forward-looking information, except as required by law. During today's call, management will also discuss certain non-GAAP financial measures for comparison purposes only. For the definitions of non-GAAP financial measures and recalculations of GAAP to non-GAAP financial results, please see the 2025 fourth quarter and full year financial results news release issued earlier today. As a reminder, this conference is being recorded. A webcast replay of this conference call will also be available on UDOT's corporate website at ir.udot.com. Joining us today on the call from UDAS Senior Management are Dr. Feng Zhou, our Chief Executive Officer, Mr. Lei Jin, our President, Mr. Peng Shu, our Senior VP, and Mr. Wayne Lee, our VP of Finance. I will now turn the call over to Dr. Zhou to review some of our recent highlights and strategic direction.

Thank you, Jeffrey, and thank you all for participating in today's call. Before we begin, I would like to remind everyone that all numbers are denominated in MMB, unless otherwise stated. In the fourth quarter, both net revenues and cash flow showed strong improvement. Net revenues reached RMB 1.6 billion, a 16.8% year-over-year increase. This growth was primarily driven by the learning services segment returning to a growth trajectory, combined with the sustained strong performance of our online marketing services. Net cash flow from operating activities for the quarter was RMB 184.2 million, up 16.4% year-over-year. Our operating profits for the fourth quarter was RMB 60.2 million, marking our sixth consecutive quarters of operating profitability, representing an increase of 113% quarter-over-quarter and a decrease of 28.5% year-over-year. For the full year 2025, our key financial performance demonstrated positive momentum across the board. Total net revenues for the year reached RMB 5.9 billion, an increase of 5% year over year. Operating profits grew to RMB 221.3 million, up 48.7% year over year. Notably, 2025 marked the first year we achieved full year net cash inflow from operating activities, totaling RMB 55.2 million. This compared with the net cash outflow of RMB 67.9 million in 2024. This milestone reflects continued improvements in our competitiveness in operating efficiency and fulfills the financial objectives we set at the beginning of the year. I will now walk through the performance of each business line during the fourth quarter. Starting with learning services, fourth quarter net revenues reached RMB $727.2 million, representing a 17.7% year-over-year increase. This performance reflects a clear return to growth following the successful completion of our strategic restructuring. Within the segment, Digital content services contributed RMB 436.1 million, up 12.2% year-over-year. Youdao Lingshi continued to perform well, with revenue surging over 40% year-over-year. Retention rates exceeded 75%, representing an improvement of approximately 5%. These results demonstrate meaningful progress in both scale and user satisfaction. Technological innovation remains central to our product competitiveness. During the quarter, Yodao Lingshi was recognized by CNR as the 2025 Industry Benchmark Education Group. This recognition affirms our leadership position and reflects our continued investment in education technology. Building on the successful launch of our Chinese AI essay grading feature, we plan to introduce an English AI essay grading tool in the near future. Powered by our proprietary large language model, Confucius, and aligned with rigorous examinations standards, this tool is designed to help students improve their writing proficiency and quality. Our programming course also delivers strong results. Continuous product upgrades drove a 50% year-over-year increase in gross billions for the fourth quarter, supported by retention rates above 75%. Importantly, student achievements remain a key measure of success. In 2025, hundreds of our students achieved top results in the NOIP and the CSPJ and S finals, validating the quality and effectiveness of our programming curriculum. Within the learning services segment, AI-driven subscription services delivered particularly strong performance. Fourth quarter sales exceeded RMB 100 million, representing an over 80% year-over-year increase. For the full year 2025, total sales approached RMB 400 million, a record high with annual growth exceeding 50%. This will reflect both the expansion of our product portfolio and sustained demand for high-quality AI-powered apps. We're driving this momentum through two primary avenues. First, we are expanding into new market segments through innovative applications. In 2035, we launched Dollar AI, an integrated AI-powered plagiarism detection and writing refinement application. In the fourth quarter, its sales doubled quarter-on-quarter. We have also recently entered into an official partnership with Turnitin, the global leader in academic and research integrity, which we expect to further accelerate adoption. Second, we continue to enhance our core applications. The AI simultaneous interpretation feature within U.DOT dictionary and U.DOT desktop translation achieved over 100% year-over-year sales growth in the fourth quarter. These innovations were recognized with multiple industry awards, including Qubit AI, Outstanding AI Product, and China AI Product of the Year. Turning to online marketing services, fourth quarter net revenues reached RMB $660.9 million, up 37.2% year-over-year. Growth was driven by increased demand from the NetEase Group, as well as overseas markets, supported by our continued investments in AI technology. This growth was broad-based across multiple verticals. In gaming, stronger collaboration with NetEase Group and expansion of third-party clients drove a 50% year-to-year increase in advertising revenue. At the same time, we are capitalizing on the AI boom Rapid advances in large language models have fueled marketing demands for many high-growth AI apps. By positioning ourselves early as a preferred marketing partner in this trend, we achieved significant gains in client acquisition, resulting in revenue growth of over 50% for the quarter. International performance was also strong. Overseas KOL revenues increased by more than 50% year-over-year in the fourth quarter. In 2025, we successfully executed campaigns in over 50 countries. Our global capabilities were recognized by TikTok for Business, which named the Yodah ads as its 2025 Influencer Agency Game Industry Pioneer List, TikTok for Business 25. Further reinforcing our leadership in global digital marketing, gross margin for the online marketing segment was 27.8% in the fourth quarter, representing a two percentage point sequential improvement despite a year-over-year decline. This reflects two deliberate strategic choices. First, we prioritize client acquisition with new clients accounting for approximately 30% of our advertisers this quarter. While margins are typically lower during onboarding, these partnerships provide a foundation for long-term value creation. Second, we're beginning to see margin expansion from technological upgrades. The launch of our second generation AI ad placement optimizer which integrates automated creative production has begun to improve both advertising efficiency and profitability. In the smart devices segment, fourth quarter net revenues were IMB 176.5 million, down 26.6% year-over-year. We continue to focus on improving this segment's overall operational health and made significant progress in 2025. Our flagship UDAH dictionary pen remained the top-selling product on JD.com and Tmall during the November 11 shopping festival for the sixth consecutive year. Meanwhile, we continued to enhance the UDAH tutoring pen launched earlier in 2025, adding features such as intelligent knowledge cards and upgraded AI pod video explanations. Since launch, the system has generated over 600,000 videos. User engagement has been encouraging with active users accessing tutoring features more than 10 times per day in the fourth quarter. In summary, 2025 has been a year of comprehensive progress driven by our AI native strategy. From the strong performance of our advertising business enabled by the AI app placement optimizer, To improve the user retention and engagement across our learning services, we have demonstrated that technological innovation translates directly into user value and commercial results. Our expanding portfolio of AI subscription and device products, including U.S. simultaneous interpretation, Scholar AI, and E-Dub, and the AI tutoring plan, have broadened our reach to new user segments. Financially, we maintain strong discipline, deliver the meaningful profitability growth in our first ever full year of net operating cash inflow. This milestone underscores the sustainability and the resilience of our business model. Looking ahead, we remain firmly committed to our AI native strategy with a clear focus on advancing our learning services and advertising businesses. We will continue developing high performance vertical large language models tailored to user needs while actively capturing emerging opportunities such as AI agents, which significantly expand the potential for application layer innovations and data-driven value creation. Through these efforts, we aim to deliver differentiated user experiences while driving long-term sustainable growth. We're not just participating in the AI transformation. We are building the foundation for sustained intelligent growth. With that, I will turn the call over to Supong for a more detailed discussion of our financial results. Thank you.