Weibo - Earnings Call - Q2 2025

Transcript

Speaker 6

Today, and thank you for standing by. Welcome to Weibo Corporation's second quarter 2025 financial results. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you need to press star one and one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one and one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to our speaker today, Sandra Zhang of Investor Relations. Please go ahead. We have a technical team on the line. Please remain on the line. Your conference will resume shortly. Thank you. Please remain on the line. Your conference will resume shortly. Thank you. We are now back. Our conference can resume.

I would now like to hand the conference over to our first speaker today, Sandra Zhang of Investor Relations. Please go ahead.

Speaker 0

Thank you, all presenters. Welcome to Weibo Corporation's second quarter of 2025 earnings conference call. Joining me today are our Chief Executive Officer, Gaofei Wang, and our Chief Financial Officer, Fei Cao. The conference call is also being broadcast today on the internet and is available through Weibo Corporation's IR website. Before the management remarks, I would like to read you the three public statements in connection with today's conference call. During today's conference call, we may make forward-looking statements. Statements that are not historical facts, including statements about beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Weibo Corporation assumes no obligation to update the forward-looking statement in this conference call and elsewhere.

Further information regarding this and other risks is included in Weibo Corporation's annual report on Form 20-F and other filings with the SEC. All the information provided in this press release is occurring as of the date hereof. Weibo Corporation assumes no obligation to update such information except as required under the applicable law. Additionally, I would like to remind you that our discussion today includes certain non-GAAP measures, which exclude stock-based compensation and certain other expenses. We use non-GAAP financial measures to gain a better understanding of Weibo Corporation's comparative operating performance and future prospects. Our non-GAAP financials exclude certain expenses, gains, or losses, and other items that are not expected regarding future cash payments or are non-recurring in nature or are not indicative of our core operating results and outlook. Please refer to our press release for more information about our non-GAAP measures.

Following management's prepared remarks, we will open the lines for a brief Q&A session. With this, I would like to turn the call over to our CEO, Gaofei Wang.

Speaker 2

谢谢，大家好，欢迎大家参加微博财报电话会议。

Speaker 0

Thank you. Hello everyone, welcome to Weibo Corporation's second quarter of 2025 earnings conference call.

Speaker 2

本次财报会我向大家重点介绍了微博二五年第二季度的财务运营以及商业化方面的进展。

Speaker 0

On today's call, I will share with you highlights on Weibo's product and monetization in the second quarter of 2025.

Speaker 2

with an adjusted operating margin of 36%.

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On the user front, in June 2025, Weibo's MAUs reached 588 million, and average DAUs reached 261 million. In the second quarter, Weibo's total revenues reached $444.8 million, up 2% year over year. Our total ad revenues reached $383.4 million, up 2% year over year. Our non-GAAP operating income reached $161.8 million, representing a non-GAAP operating margin of 36%.

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user growth, content ecosystem competitiveness, and commercialization growth.

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In 2025, the company's overall strategy focuses on the value of user, sustaining the leading position in trending topics and entertainment sectors, and solidifying the competitive edge of the social product. On top of that, we prioritize enhancing the recommendation and search functions by integrating large language models to drive user skill and engagement. Next, let me share with you our progress made in the second quarter of 2025 from three dimensions: user growth, the competitiveness of the ecosystem, and monetization.

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user content consumption and increasing the scale of user content consumption.

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On user growth and engagement, we focus on the integration of social product and upgrade of our recommendation system this year, aiming to drive user engagement and user growth. Over Weibo's 15 years development, the homepage information feeds have continuously evolved to achieve two core objectives: to enhance the efficiency of content consumption and social interaction by users. Accordingly, the content recommendation mechanism of information feeds has evolved from a timeline-based distribution to a recommendation-based distribution. To be specific, the information feed were originally distributed in reverse chronological order based on the posting time. As content creation became more convenient for users, the explosive amount of content produced largely exceeded the amount of content consumed. Therefore, to improve content consumption efficiency, we upgraded the algorithm of information feeds from purely timeline-based to focusing on distributing unread posts from individual accounts being followed by users in 2016.

Later in 2018, we introduced a new feed product structure composed of a relationship-based feed and an interest-based feed, aiming to broaden users' content discovery and increase their content consumption scale.

Speaker 2

随着用户消费内容以及被推荐的习惯改变，我们在今年上半年对首页信息流产品进行了升级改版。新版本首页以推荐流作为用户打开微博或者默认首页，实现了以推荐流为主的产品结构。推荐的分发机制也进行了重大调整。一方面，融合了原有关系流的社交内容与原有推荐流基于兴趣内容的推荐机制，另一方面，重点加强了用户在推荐流的消费互动推荐反馈，满足用户当下的深度消费需求。整体来说，新推荐流在保存用户对原有社交内容消费的基础之上，进一步提升了用户在推荐流发现兴趣内容的快速匹配和深度消费的体验，并且结合大模型的能力，提升推荐内容质量，提升用户对推荐内容的消费体验。

Speaker 0

In recent years, users' content consumption behaviors have been altered by the recommended content. To adapt to this trend, we initiated a strategic revamp of our homepage information feed in the first half of this year, which makes the interest-based feed a primary interface when users access Weibo. We also made a significant adjustment to the distribution mechanism of the interest-based feed. On the one hand, we integrated the recommendation mechanism for both relationship-based feed and interest-based feed. On the other hand, we enhanced the user feedback mechanism based on users' interaction and consumption behaviors in the interest-based feed, aiming to meet their in-depth consumption demands. Overall speaking, while preserving users' fundamental needs for social content consumption, the upgraded interest-based feed delivered improved efficiency of discovering interest-based content and deepened user engagement.

Additionally, by leveraging large language models, we have enhanced the quality of recommended content, improving users' overall consumption experience.

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efficiency optimization and the platform's content ecosystem.

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We hope the upgrade of the homepage information feed will further unlock Weibo's value in delivering quality content. We aim to enhance users' consumption depth and engagement through algorithm capability, which will strengthen the competitiveness of our vertical content ecosystem. In early July, we completed the upgrade of product and technical frameworks, which has rolled out to nearly all users. Currently, with the average content views of homepage information feed per user remaining stable, the proportion of the recommended content consumed by users has increased to 43%, representing a 17% improvement over the previous level. This established a solid foundation for efficiency improvement and the development of the platform's content ecosystem.

Speaker 2

随着首页信息流产品的升级，平台流量策略会对关注关系分发拓展到兴趣分发，来增强平台的内容竞争力。社交产品沿着平台多年积累的社交关系以及兴趣社区来强化平台的社交属性，提升用户在平台分享和互动的积极性。二季度我们进一步加强了用户在核心产品场景的社交互动体验，取得比较明显的进展。例如，用户反馈问题较多的评论区的低质内容，我们重点针对明星和头部博主的评论区，加强低质内容的识别和治理，有效地改善了讨论质量，提升了用户评论区访问和评论意愿。针对明星超话，我们重视用户真实交流、分享和社交需求，重点提升了明星超话的多样性、实时性的社交氛围体验，恢复明星超话的社交感。明星超话二季的发帖人数、互动人数和阅读人数同比实现了明显的增长。

Speaker 0

With the upgrade of the homepage information feed product, our product's content distribution strategy will stand from relationship-based distribution to interest-based distribution, aiming to enhance content competitiveness. For social products, leveraging the platform's long accumulated social assets and interest-based communities, we reinforce the platform's social attributes and boost the user's willingness to share and interact. In the second quarter, we further strengthened users' social interaction experience in the core product scenario, achieving notable progress. For example, to address the prevalent issue of low-quality content in comment retention, particularly comments entered posts by celebrities and top KOLs, we enhanced the identification and monitoring of low-quality content. This effectively improved discussion quality and increased users' willingness to revisit and engage in a commentary session.

For the celebrity-related super topics, we prioritized users' genuine communication, content sharing, and consumption needs, and focused on improving the diversity of content and real-time attributes of the community. These efforts helped improve social connection in the celebrity-related super topics, driving notable year-over-year growth of users who posted, engaged, and consumed content in the second quarter.

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a win-win result for users who love to watch, creators who grow, and the platform.

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To enhance the competitiveness of the content ecosystem, our interest-based feed will become the primary feed for content distribution. In the second quarter, on the vertical content ecosystem, we completed the transition of content operation from an influencer-based model to a vertical content-based model, which attracted content creators from cross-verticals to generate content on a specific vertical area. Currently, over 50% of the interest-based content from key verticals is generated from cross-vertical KOLs, which benefit from our use of deep cultivation in vertical areas and the advantages of our vertical content operation. In the second quarter, vertical content consumption accounted for 60% of the interest-based feed consumption. Meanwhile, the new interest-based feed optimized content quality by allocating more traffic to high-quality authentic content. This increased the traffic share for KOLs and celebrity accounts, while also providing more growth opportunities for mid-tier and long-tail KOLs.

In the second half of this year, with the goal of enhancing user engagement through the interest-based feed, we will increase the supply of quality content to users through product offerings and recommend more precise and engaging content to users through recommendation. This will improve the efficiency for users to access effective content and their satisfaction of content consumption, thereby further driving up content consumption and more frequent usage. While solidifying Weibo's advantages in entertainment verticals and trending topics, we will support the long-term development of the vertical content ecosystem to achieve a win-win situation where users enjoy quality content, creators develop, and the platform thrives.

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search效果。同时, 平台促进博主生产更多内容, 填补观点, 用于Zhisou AI search结果的优化。Zhisou AI search产品在二季度继续快速发展。6月, Zhisou AI search的月活用户突破5,000万, 这周产品显著提升了用户在赠送下的消费体验以及在主动搜索产品上的搜索满足率。二季度Zhisou AI search月活用户数较一季度大幅增长, 也进一步促进了搜索的精确量的环比增长。从更长期来看, 基于large language models的总结和归纳能力, 我们相信Weibo平台上沉淀了十多年的优质内容和观点, 能够在综合搜索结果呈现上得到更加充分的体现, 也能明显提升搜索结果的有效性和消费效率, 让Weibo搜索从实时加热的搜索更好地满足用户长尾搜索需求, 提升平台搜索产品的竞争力。

Speaker 0

Next, let me share with you the updates of Weibo's intelligent search product. In the second quarter, we beefed up our efforts to transform the AI-powered search experience through optimization in model strategies, enrichment of database, and integration of multimodal content. Additionally, we incentivized the content creators to produce more high-quality content and perspectives, which further refined the quality of search results. As a result, Weibo's intelligent search saw robust growth during this quarter, with MAUs surpassing 50 million in June. Notably, Weibo's intelligent search has significantly enhanced the user experience for trending topics, as well as better fulfilled user queries in on-demand search scenarios. Daily active users of intelligent search also increased notably quarter over quarter, driving solid growth in average daily search queries.

In the longer run, powered by the large language model summarization capabilities, we believe that the high-quality content and diverse viewpoints accumulated on Weibo over a decade will be presented in a more thorough way. This will not only improve results relevancy and content consumption efficiency, but also enable Weibo's intelligent search to go beyond trending on real-time topics to better address long-tail search needs. We are encouraged to see an AI-driven roadmap to strengthen our competitive edge in the search market.

Speaker 2

从商业化增长方面，2025年广告产品KOL团队聚焦在微博的内容营销的品质，向更多的行业以及客户进行渗透和巩固，并不断提升广告产品的销售转化能力。从整体市场看，在扩大内需促进消费增长的引导下，电商平台以及相关行业在这个季度的投入增加大。本季度营销工作的重点为以持续整合微博特有的热点、明星、头部KOL的内容优势，在扩大客户市场覆盖的同时，聚焦客户新品营销市场，强化微博作为新品营销主阵地的客户心智。第二，保持在效果广告产品持续的投入，提升销售广告预算的过滤能力，并在今年的收入持续得到正向反馈。

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Moving on to monetization in 2025, our ad product and sales strategy focused on expanding and solidifying customers' mindsets of treating Weibo as a go-to platform for content marketing across industries, as well as enhancing ad product conversion capabilities. From the demand side, backed by consumption stimulus policies, e-commerce platforms and related sectors increased their ad spend during the quarter. We focused on two aspects in our sales execution this quarter. First, we continue to leverage Weibo's unique strength in trending topics, celebrity resources, and top KOL content to broaden our industry reach, while focusing on new product launch marketing to further reinforce Weibo's position as the go-to platform for clients. Second, we maintained our investment in performance-based ad products, which enhanced our capabilities to capture incremental ad budgets and continue to deliver positive revenue outcomes.

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for new energy vehicle launches exceeded 60%.

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By industry, e-commerce platforms showed a solid year-over-year revenue growth in the second quarter, benefiting from close partnerships with major platforms during the 2018 Shopping Festival. As a pivotal arena for boosting domestic consumption, e-commerce and related categories, such as local service, are expected to further ramp up marketing efforts with Weibo this year. As for the automobile vertical, Weibo continues to be the key discussion hub for new energy vehicles, sustaining its ecosystem advantages. Major OEMs have increased their budget allocation to Weibo, with marketing coverage for new EV model launches exceeding 60% in the first half of this year.

Speaker 2

在消费品行业，包括市民饮料和鞋服、美妆、各种类等领域，我们看到整体客户市场正在发生变化。随着持续起来电商效果的投入和竞争，客户在这方面的投入边际效应明显递减，越来越多的客户在考虑重新经营，重新考虑品牌建设。比如，我们看到过往将预算全部转移到电商效果或者QC种草的客户，今年开始重点考虑将预算投入到民营代言或者内容IP的制作和冠名上。客户在这方面的变化是逐步且谨慎，但我们看到这个趋势有望持续。今年上半年，消费品行业客户对微博的新品、明星代言和IP年二关注度大幅提升，新品和明星的官宣核心场景的收入和项目数同比居上位数增长。上新微博的合作粘性加强，明星价值的呈现回归趋势。与此同时，我们将细分消费品行业客户营销需求，加强广告产品建设，将明星以投资内容创作者和客户的营销内容以博文和热点这些微博特有优势内容结合起来。通过微博内容加热和内容聚合的广告产品，将营销内容链路打通，从而有效推动客户营销内容并为客户建立用户心智，提升营销转化。

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In the FMCG category, including food and beverage, footwear and pavilion, and personal care and beauty sectors, we are seeing shifting in client marketing strategies. After years of heavy investment in e-commerce performance and key KOC seeding, more and more advertisers now face diminishing returns, which prompt a reconsideration of downfielding. For instance, certain advertisers who had previously shifted most of their budget to performance-based marketing or influencer seeding are now reallocating budget towards celebrity endorsement, content IP creation, and sponsorship. While this ambition is gradual and measured, we believe this trend is likely to continue. In the first half of 2025, advertisers from the FMCG category became increasingly interested in Weibo's product launch, celebrity and IP marketing offerings. As a result, both the number of campaigns and revenue generated from product launch and celebrity official announcement campaigns built a double-digit year-over-year growth.

We are encouraged to see customer stickiness to our product launch marketing further enhanced, with the value of celebrity assets gradually revived. Meanwhile, we focus on tailoring our ad products to fulfill the more granular marketing needs of different segments within the FMCG sector. We seek to amplify the synergy between commercial content and organic posts and trending topics generated by celebrities or KOLs, leveraging our ad product live content boosting and aggregations. With these efforts, we aim to facilitate more effective distribution of commercial content, so as to cultivate consumer mindsets and drive conversion.

Speaker 2

广告产品方面，二季度新进展广告同比保持增长，其中效果电商客户的投放效果增长不错。三季度我们会继续扩大客户覆盖，这一增长趋势有望在下半年得到延续。同时，二季度我们继续加强AI在商业领域的探索和应用，提升广告素材创建审核效率，以及广告定向和点击效果。整体上促进了新一轮进展广告和SBM在二季度的同比提升。

Speaker 0

From ad product perspective, as revenue from our promoted feed offerings enter the real-time bidding system, sustained solid year-over-year growth in the second quarter, with distinct enhancements of ad performance for those performance-driven e-commerce advertisers. In the third quarter, we plan to further expand advertiser coverage and see opportunity to extend this growth trend through the second half of this year. Meanwhile, we are stepping up our exploration and integration of AI on the monetization front, with its focus on streamlining ad creation and accelerating review process, as well as improving ad targeting and click-through rates. These initiatives successfully drove higher ECPMs for real-time business feed ads in the second quarter versus the same period last year.

Speaker 2

目前是三季度商业化，由于去年存在奥运会的高接入的情况，对三季度的收入增速产生了一定负面影响。我们会积极把握电商、汽车、医疗健康等确定性客户的营销机会，提升品牌加内容营销在这些行业的渗透，以及我们在信息流进展广告方面取得的进展，获取收入增长预算。更为长期来看，我们会继续坚持内容运营和商业运营策略协同。随着新一轮所谓新流产品升级，强化垂直内容生态的发展，促进新内容消费，内容营销能够更有效地触达及兴趣消费群体。我们在内容和新品营销的优势会更加凸显，从而强化微博在客户市场中的长期预算竞争力。

Speaker 0

Entering the third quarter, we do face a tough comparison due to the high base from last year's auditions, which would negatively impact on the year-over-year growth. That said, we'll beef up sales efforts to capture visible opportunities from sectors such as e-commerce, automobile, and healthcare sectors, etc., with focus on driving the penetration of our brand plus content marketing among these sectors. Furthermore, we strive to secure incremental budget, leveraging the progress we made in real-time bidding feed ad products. In the longer run, we remain committed to amplifying the synergy between content and monetization operations. With the revamp of information feeds on homepage, we have a clear roadmap to further strengthen our vertical content ecosystem and reduce the interest-based content consumption, enabling commercial content to effectively reach desirable audiences.

At that time, our value proposition of content and new product marketing will become even more pronounced and therefore reinforce Weibo's competitive edge in the ad market.

Speaker 2

接下来让我将给曹菲介绍二季度的财务结果。

Speaker 0

With that, let me turn the call over to Fei Cao for a financial review.

Speaker 5

Thank you, Gaofei, and hello everyone. Welcome to this second quarter's 2025 earnings conference call. Let's start with user metrics. In June 2025, Weibo's MAU and average DAU reached 588 million and 261 million, respectively, representing a net addition of 5 million and 5 million users on a year-over-year basis. The DAU versus MAU ratio further enhanced as our strategic focus on high-quality users is paying off. Leveraging the transformative power of AI, we are revamping our recommendation engine, as well as feed and search experience, to make Weibo more relevant and engaging. Turning to financials, as a reminder, next quarter's remarks will focus on non-GAAP results. All monetary amounts are in U.S. dollar terms, and all comparisons are on a year-over-year basis, unless otherwise noted. Now, let you feel through our financial highlights for the second quarter 2025.

Weibo's second quarter 2025 net revenue was $444.8 million, an increase of 2%. Operating income was $161.8 million, representing operating margin of 36%. Net income attributed to Weibo reached $143.2 million, an increase of 13%. The value to the EPS was $0.64. Let's make a few more colors on the second quarter 2025 revenue performance. Weibo's advertising and marketing revenues for the second quarter 2025 were very flimpery, $383.4 million, up 2%, while value-added service revenue was $61.4 million, down 2%. Weibo's advertising business continued to deliver a slight uptake, which resulted from mixed performance of major ad verticals by industry. Our top three verticals were FMCG, e-commerce, and 3C products. In terms of both, e-commerce, internet services, and automobile were the key contributors, benefiting from trading policies and intensifying competition among platforms.

E-commerce advertisers increased their ad spending on Weibo to boost brand visibility during the June 18th Shopping Festival. The automobile sector sustained healthy growth, as Weibo plays an increasingly important role in building market health for EV launches and retains best jointed customers of the auto vertical. The FMCG sector continued to see a year-over-year decline. However, we are seeing early signs of gradual recovery. Despite near-term pressure, we are encouraged to see a gradual comeback with those major festival brands, FMCG brands, reallocating their budget to Weibo's celebrity and club love ad offerings to engage our young and high-value users. Other underperforming industries that drag the overall top line of traffic include online games, luxury, and entertainment. In particular, the online game sector remains soft due to tough calls and lack of blockbuster releases this quarter.

The ad product category, promoted feed ads, remains the largest contributor, followed by social display ads and topics and search placement. We have been integrating AI to facilitate smarter ad targeting and placement, which fills the double-digit goal of our feed ad offerings. Specifically, our real-time bidding feed products show strong improvements in both performance and conversion metrics. Ad revenue from Alibaba sustained a healthy growth of 10%, reaching $45.7 million in the second quarter, marking a larger share of Alibaba's ad wallet in Q2, driven by increased marketing demand during the June 18th Festival and heightened competition in the local service segments. Looking ahead to the second half of the year, we expect to face a tough year-over-year comparison in the first quarter due to the Summer Olympics in the prior year.

Also, advertisers from consumption-related industries remain conservative in their ad budget allocation in light of low-yield political outlook and macro uncertainty. That said, we will step up our sales execution to capture engaging opportunities, particularly in on-demand e-commerce services and new EV launches. In the longer term, we aim to further integrate AI capabilities to drive meaningful improvements in ad inventory, reliability, and ECPM updates. Value-added service revenue grew 2% to $61.4 million in the second quarter, mainly due to a modest decrease in membership services. Turning to cost expenses, total cost expenses for the second quarter were $283 million, an increase of 1%, with increase in cost of revenue and product development expenses offset by decrease in general and administrative expenses. Operating income in the second quarter was $161.8 million, an increase of 3%, representing operating margin of 36% versus the same period last year.

Turning to income tax, income tax expenses for the second quarter were $31.7 million, compared to $33.3 million last year. Net income attributed to Weibo in the second quarter was $143.2 million, an increase of 13%, representing a net margin of 32% compared to 29% last year, primarily attributable to higher net interest and other income. Turning to our balance sheet and cash flow items, as of June 30, 2025, Weibo's cash and short-term investment totaled $2.11 billion, compared to $2.35 billion as of December 31, 2024. The decrease of Weibo's cash and short-term investment mainly resulted from the purchase of long-term wealth management products and the payment of the annual dividends to our shareholders in the first half of 2025, and was partially offset by operating cash flow. In the second quarter, cash provided by operating activities was $24.8 million.

Capital expenditures totaled $17.6 million, and the depreciation and amortization expenses amounted to $14.8 million. With that, let me now hand the floor over to the operator for the Q&A session.

Speaker 6

Thank you. As a reminder, to ask a question, please press star one and one on your telephone keypad and wait for your name to be announced. To withdraw your question, please press star one and one again. Please stand by as we compile the Q&A roster. Our first question comes from the line of Felix Liu from UBS Investment Bank. Please go ahead.

Speaker 4

谢谢管理层接受我的提问, 也恭喜我们二季度很好的一个业绩。刚刚管理层提到了微博滞收的进展, 我想请管理层进一步分享一下我们滞收产品策略以及未来商业化的想法。另外, 能否请管理层分享一下AI对于促进我们商业化方面的进展? Thank you, management, for taking my question and congratulations on the strong second quarter results. Management earlier mentioned about your progress on Weibo Zhisou AI search product. Can management elaborate a bit more on your product strategy and the future plan for commercialization? Furthermore, on AI, could management share more progress on how AI is helping the overall monetization and commercialization for the Weibo platform? Thank you.

Speaker 2

OK, 谢谢。我们在上一季度其实跟大家也是简单分享过滞收，然后呢，我们在一季度其实主要是刚刚接入了这种 DeepSeek，把搜索接入了这种 DeepSeek R1 的模型，然后推出了最终这个产品。二季度来讲的话呢，算是滞收在微博推出的相对比较完整的一个季度。在二季度的六月份的时候，我们又把这个滞收接入了这个阿里天问的模型，主要是因为之前 R1 的模型其实在输出结果上的速度是比较低的。其实我们还是有很多用户其实等不到这个结果的产出。整体来看的话呢，在二季度滞收这个产品还是处于比较进化或者完善的一个过程中。在二季度末相对来讲的话，产品形态上算是基本的稳定。这样。

Okay, so actually in the last quarter, we've already shared that in Q1, we promoted the intelligent search product. In Q1, we actually connected to the DeepSeek R1 model, and we promoted the product, launched the product. In Q2, it was a first full season for the intelligent search to be present in Weibo. In June, we also connected to the Ali Q1 because for the DeepSeek R1 model, in terms of the output speed, it's a bit low. A lot of users couldn't wait for the results we produced. In general, we should say that in Q2, the product is still being perfected and it's still in the process. Basically, at the end of Q2, the product form was finally stable.

AI search product 的MAU刚才我介绍了, 超过了5,000万, 管理大概有个60%的提升。它的DAU和用户的query量来讲的话呢, 增长可能更为快一些, 日损用户量可能增速可能超过100%。query量的增速大概比上个季度提升大概在150%左右吧。整体搜索的这种, 我们从这个数据也能看到整个用户的使用规模在增长, 而且用户使用的频次也在很明显的提升。

In terms of June, just now we introduced that actually for the MAU, it's already over 50 million. For query, it also improved by 60%. As for the DAU and for the user query, actually the growth was even faster. The growth rate was already over 100%. In terms of the traffic, it grew by around 150% compared to the previous quarter. In general, we can see from that data, actually the user scale is growing and the frequency of usage is obviously increasing.

我们自己对下半年滞收的产品功能上的期望还是比较高的，大家您关注微博的能可以看到，就是微博我们搜索其实长期一直它的优势是在新闻搜索方面，我们在更长尾的搜索方面呢，一直这个平台上面的优势不是不太强。滞收这样一个产品，我们会看到在用户目前的使用里面，当然基于新闻的搜索还是很大的一个比例，但是有越来越多的用户在使用滞收之后开始使用滞收的一些经验搜索，包括产品搜索，包括长尾搜索这方面的功能。我们认为包括现在的一些模型，它的内容的引入，包括一些也帮助我们进行了一些站外的一些信息搜索的结果，在站内在微博之中里面可以获得体现。这也对于我们未来改变我们目前微博搜索用户的使用习惯，提升他们长尾搜索的这种占比是至关重要的。

We have pretty high expectation on the intelligent search product in the latter half of the year. If you have been following Weibo, you would know that we have always had the advantage of news search. In terms of the long-tail searches, Weibo isn't that advantageous in that aspect. Right now with this product, we can see that in the current usage by the users, the search on the news is still accounting for a big %, but more and more users are using it, and now they're using it for the experience search, product search, maybe some other long-tail searches. Also now with the connection of the models and other content, it also helps us in terms of displaying some of the out-of-site search results that can be displayed in the intelligent search on Weibo.

That is very vital for Weibo to really change the user behavior of the users and also to improve the % of the long-tail searches.

user stickiness and traffic. The data growth is indeed quite fast, and we already have high expectations for the future commercialization of this product.

In the industry, people have this general awareness that AI search is clearly overtaking and replacing the traditional search, and that is a clear trend. Now in the social media platforms, we can see that for us, we're not only making the search function better, actually in terms of the usage on Weibo, you can see that for users, when they use this product, it's not just about the search, it's also about social interactions. For example, in the comment sections, they can do fact checking, and also for some of the blogs, they can also use this kind of tool to fact check or maybe do some extensive reading for the relevant material. There are a lot of use cases and scenarios, and they are some of the key works, key directions for our latter half of the year, and we do have some pilots going on.

In terms of commercialization, we should say that actually a lot of clients are interested in this product, but we are not overly anxious in terms of commercialization, and we tend to try to expand the user base right now. In the future, for the commercialization, maybe it's about the bundled cooperation with the brands, or maybe it's just like in the traditional search where we include ads in the search results. Actually, in the latter half of the year, in Q3, we may not consider that. Maybe in Q4, we would do some tests. Overall speaking, we should say for this product, it's really important for us to increase the user base for the search and also to help us increase the user stickiness and the traffic. We have a really high expectation in terms of the future commercialization of the product.

刚才您说的第二个问题是关于AI广告的，对吧？广告这方面一方面我们觉得其实这个进展其实大部分的平台都类似，就是说集中在效果广告方面。我们一方面是包括这种AI素材的自动投放，我们在二季度上线了我们自己内置的这个叫AI广告的创意平台，灵创平台。目前来讲的话，现在素材消耗里面百分之十几是来自于AI的这个素材。结果来看，其实刚才在Screen里面我说到了我们整个二季度整个信息流进展广告的ECPM大概增长了个位数吧，对，然后不到10%。具体到CTR方面可能不同客户的这种类型不一样，线索类的可能CTR区分高一些，大概20%左右，但是调这个APP的可能在百分之十几，但是综合到ECPM上可能在不到10%吧。这是一个这个信息流，也就是说效果广告方面的一个进展。

Your second question was about AI ads. In terms of ads, I think most of the platforms are alike. That means they're mostly concentrating on the performance-based ads. For us, on one side, it's about the auto placement of the AI assets. In Q2, we launched our AI ad creative platform called Lingchuang. Right now, for the assets that are consumed, actually more than 10% is already from AI. From the results, just now we already talked about it, for Q2, in the information feed ads, the ECPM grew by single digit, less than 10%. When it comes to CTR, I think for different clients, for different client types, things would be different. For the leads type, the CTR would be higher, maybe around 20%. For the apps, maybe more than 10%. Comprehensively, the ECPM maybe grew by less than 10%.

That's for information feed or maybe for the performance-based ads.

然后另外在品牌这个广告方面，因为其实因为很多的品牌客户本身的在微博投放的这种广告出来的质量还是比较高的，那我们其实在二季度做了一些个别客户合作，做了一些测试，因为把他们的一些比较高质量的TVC的广告，用AI的方式进行协调，或者针对不同用户群，根据他们的兴趣去做这种他们的素材的再剪辑。那这个其实比我们原来预想的效果可能要比准确的效果，这个中小的效果客户会要更好。我们看到的一些这种测试数据，基本上它的点击率可能提升跟效果广告差不多，但是它的互动力的提升其实甚至有翻倍的一个提升，整体效果还是不错的。对于品牌客户来讲，现在比较大的一个挑战还是在于整个的这种行业的这种广告投放流程方面的现实，就是我们基本上我们的品牌客户在微博进行这种信息流的投放，都还是要求素材要通过他们的审核的。这样一个工作流程其实对于AI广告，那一个素材它进行全人切面的这种广告素材再编辑，其实还是不太适应，就是限制了我们的客户，特别是品牌客户使用我们的AI广告的规模。整体来看的话呢，品牌广告其实我们觉得如果能大范围使用AI广告的话，这个效果提升会更明显，但是可能需要比较长的时间让我们的客户去慢慢接受。我们预计到年底，我们希望我们品牌客户里面大概有百分之十几能够开始使用我们的这种品牌的AI广告的系统，这个我们认为不会那么的快，可能真正能够效果广告来讲的话，使用AI广告的比例肯定是要远远超过品牌的。对。

In terms of the brand ads, for a lot of the brand customers, they are placing quite high-quality ad assets on Weibo. In Q2, we have done some tests with some specific customers. For them, they have some high-quality PVC ads, and then we use AI to conduct some coordination for different user bases. According to their interests, we conducted some re-editing with their existing assets. In terms of the result, it's better than the results for the small and medium-sized customers. They saw some of our testing results. Basically, for the click rate, it increased just like the performance-based ads, but for the interaction, it basically doubled. The overall result was pretty good. For the brand clients, the biggest challenge is still in the restraints of the process of ad placement.

For our brand customers, when they place the information feed ads, they require all the assets to be approved on their side. That kind of work process for AI ads, which is quite customized for different people, is not really adaptive. That really limits our customers, especially the brand customers, when they want to use our AI ads at scale. Generally speaking, for the brand ads, I think if we can use AI ads on a large scale, the performance and the results would be even more obvious in terms of its improvement. It may take some time for our customers to gradually accept it. We expect that at the end of the year, maybe more than 10% of our brand customers can start to use the AI ad system.

Speaker 6

Thank you. Just a moment for our next question, please. Next, we have Timothy Zhao from Goldman Sachs Group. Your line is now open.

Speaker 1

好的，管理层晚上好，感谢接受我的提问。那我的问题是有关我们的广告收入的，那想请教一下我们对这个公司的三季度和今年下半年整体的广告收入有怎样的一个展望，那哪些行业应该会展现出比较好的一个增速。另外，从一个广告的模式上面就想请教一下，如果我们去看像这个展示广告、搜索广告，包括我们刚刚聊到的这个信息流广告，在今年下半年是一个怎样的增长预期。那管理层刚刚也提到这个AI在信息流销售广告上面的一些应用，那想请教一下，如果是到这个滞收的话，那我们看到滞收的用量提升的是非常高，那这部分对我们已经有的这个搜索广告，是有怎样的一些影响。然后很快翻译一下。 Thank you, management, for taking my question. My question is regarding the advertising revenue growth outlook. Can management share what is your expectation for the ad revenue growth into the third quarter and second half of this year? And specifically, which industries may show a stronger revenue growth? From the format perspective, just wondering, what is the difference in terms of growth rate between search ads, display ads, recommendation feed ads, etc.? Specifically, as management already mentioned, the applications of AI in information ads. Just wondering, given the very rapid usage of the AI search functions on Weibo, what are the implications for the search ads growth? Thank you.

Speaker 2

OK, 那下半年其实还是有，特别是我们看博主主要是国补的，有些行业是有一定的不确定性的，主要是跟国补相关的，像手机啊，包括汽车这些行业是有一些不确定性的。到三季度来看的话，我觉得第一方面就是，刚才二季度也讲了，就是电商，包括汽车这些行业，我们觉得还是可以保持一个不错的增长吧。另外就是这两年随着可能随着我们的用户的年龄层的变化，尤其是白领这个群体，大家对于医疗健康的重视度在提升，医疗健康这个行业这一两年增长也是不错，但是它的基数其实还没有像电商或者汽车那么大，对，这是增长不错的行业。

In the latter half of the year, especially when we look at the industries with some national subsidies, those industries still have some uncertainties, especially the national subsidy-related industries like the cell phone or the automotive industry. When it comes to Q3, I think we already covered that in Q2, which was e-commerce and also the automotive industry. We think those industries can still maintain very good growth. In the last two years, with the change of the age of our users, especially for the white-collars, people generally paid more attention to health care. Health care had pretty good growth in the last two years, but the base number was not as large as e-commerce and the automotive industry. Those are the growing sectors.

另外在Q3其实我们在FMCG行业肯定是有比较大的压力的，因为去年有奥运会，对，所以呢，像这种奶制品啊，包括很多FMCG在今年其实整个的预算也出现了一定的削减，这主要在三季度了。对，另外就是像美妆、奢侈品这些，美妆其实现在已经开始逐步稳定下来，但是我觉得在三季度还是会有一定的压力，奢侈品也是会有一定的压力。手机和游戏行业是有非常大的不确定性的，手机这个行业今年看我们的客户虽然预算上半年像的那样有一点的稳定，但是它的整个销量还是跌的比较多的。如果国补在下半年没有一些新的补贴政策出来，我们对于手机行业在下半年的增长还是有比较大的压力。至于说广告策略方面，我觉得一方面就是现在主要的最大的一个比例还是promoted feed ads，其次是展示广告和搜索广告，promoted feed ads本身是增长的。从增速讲，promoted feed ads增速是最高，其次是展示类型的广告，展示类型的广告一二度依然其实还出现了一个小幅的下降，我觉得这跟客户整体的预算向promoted feed ads、performance-based ads和内容显化广告转移有相关。纯粹的展示广告本身从我们角度而言，可能它也不是为我们自己未来的一个重心，就是说可能未来越来越多的客户会投纯粹的performance-based ads，以及会投跟明星啊，包括KOL啊，以及比如说客户自己的账号产生的内容营销型的广告，这是未来的一个主流。搜索广告方面，刚才我介绍Zhisou AI search product的时候是提了，我们现在还没有，就是客户会有一些个别客户会有一些对于Zhisou进行商业化的期望，但是目前看有些期望，我们包括业内其实也没有对这类广告有一个明确的商业化变现的模式，我们目前还是以做大用户规模和做大流量为主。然后后排组可能面那边差点展示型的广告，但是我觉得那点都太少了。我们还是说先把用户规模做上去，特别是尤其是目前Zhisou本身的用户体验和行业口碑反馈也不错，我们下半年可能在上面会增加一些不管是算力的投入，包括外部合作营销的投入，希望通过Zhisou再能帮我去获得更多的用户的增长。这是我们现在对这样一个产品最高的一个期望值。收入方面我觉得还没有那么的着急。对，谢谢。

Actually, in Q3, we still face a lot of pressure in terms of FMCG because there was the Olympics last year. For dairy products and other FMCG, there had been some spending cuts, especially in Q3. The other thing is for the cosmetics and luxury goods. Cosmetics have already quite stabilized, but we still face some pressure in Q3. The same thing goes for luxury goods. For cell phone and the gaming industry, there's huge uncertainty. For cell phone in this year, we do see that compared to the first half of the year, their budget basically stabilized, but their overall sales went down a lot. If there's no additional national subsidy policies coming out, we still expect some pressure in terms of the cell phone industry in the latter half of the year.

In terms of the ad strategy, I think the biggest percentage still goes to the promoted feed ads, then the displayed ads, and then the other ads. For the promoted feed ads, it's growing in itself. In terms of the growth rate, I think for promoted feed ads, the growth rate is the highest. For the displayed ads in Q1 and Q2, there was a small dip because I think that's related to the overall budget of the customers. For the promoted feed ads and the performance-based ads, and for the maybe content-based ads, and then for the purely displayed ads, from our perspective, I don't think the pure displayed ads is our future focus. That means more and more customers will purely go to performance-based ads, and also they may invest more in terms of star collaboration or maybe KOL investment.

Maybe customers have their own accounts, the social media account that can produce some content-based marketing type of ads. That is the mainstream in the future. For the search ads, I just introduced that, of course, there are certain customers who have some expectation on the monetization or commercialization. For us, or even in the industry, there's no clear business model for this type of ads. Right now, we still focus more on building a bigger customer base and introducing more traffic. Of course, maybe we can introduce a bit of the displayed ads, but that's too small a piece. I think we still will focus more on increasing the user base. Also, we need to focus on the user experience of the intelligent search. The feedback of the industry had been good.

We would increase a bit in terms of the budget, maybe in computing power and also the investment.

Speaker 6

For the external corporation and marketing, we hope that will help us grow in terms of the user base, because that's the highest expectation we have now for this product. In terms of the revenue and commercialization, we're in no hurry. Thank you.

Speaker 0

Thank you. Thank you for the questions. I will now turn the conference back to Sandra Zhang.

Speaker 2

Thank you all. Please wrap up our conference call today. Thank you all for joining us. We'll see you next quarter.

Speaker 0

This concludes today's conference call. Thank you for participating. You may now disconnect.