Good day, and welcome to the Cheetah Mobile Fourth Quarter 2025 Earnings Conference Call. Please note, this event is being recorded. I would now like to turn the conference over to Helen Jing Zhu, Investor Relations of Cheetah Mobile. Please go ahead.

Thank you, operator. Welcome to Cheetah Mobile's Fourth Quarter 2025 Earnings Conference Call. With us today are our company's Chairman and CEO, Mr. Fu Sheng; and our company's Director and CFO, Mr. Thomas Ren. Following management's prepared remarks, we will conduct the Q&A section. Please note that the management's prepared remarks are presented by AI agent. 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 Chairman and CEO, Mr. Fu Sheng. Please go ahead, Fu Sheng.

Good evening, everyone. Thank you for joining us. In 2025, we finished stabilizing the business and built a stronger foundation for Cheetah Mobile. During the year, our total revenue grew 43% year-over-year, driven by continued growth in both our Internet business and AI and Others segments. In the fourth quarter, AI and Others already accounted for half of total revenues, reflecting the increasing contribution of our new growth initiatives. More importantly, we achieved full year non-GAAP operating profitability, our first time in 6 years. Our Internet business remained resilient in 2025, generating approximately RMB 460,000 in adjusted operating profit every working day. This consistent operating cash flow forms the financial backbone of the company and allows us to invest in robotics and AI in a disciplined and sustainable way. Our second highlight is robotics, which is emerging as a key structural growth driver. For the full year, robotics revenue grew approximately 31%. In the fourth quarter alone, robotics revenue reached about RMB 60 million, up 94% year-over-year and 43% quarter-over-quarter. A voice robot in China achieved 100% year-over-year growth for 3 consecutive quarters, accounting for high single digits of the fourth quarter's total revenues. This progress is driven by our strategic focus on core strength in voice robotics and the integration of AI agent technology to enhance product experience. We are now seeing our voice robot become a must-have solution in receptions, guided tours, retail environments, hospitals, and service halls as they deliver proven measurable value. We recently introduced a new version of our voice robots, which comes with built-in skills like guiding, patrolling, and advertising, enabling end customers to start using them right away. Our robotic arm business, mainly in serving overseas markets, is making up high single digits of the first quarter's total revenues. We focus on long-term demand from research institutions and the R&D teams that value openness and customization. This customer base is sticky and repeatable, supporting long-term demand, building on our proven indoor autonomous mobility technologies. We are introducing a smart wheelchair, targeting developed regions such as Western Europe and North America. This product is positioned as a premium solution for users who value safety, independence, and confidence in daily mobility. We are seeing a clear shift in demand as users increasingly value safety, assistance, and intelligent features in mobility products, while scalable solutions in the market remain limited. By applying our experience in service robots, we are able to meaningfully improve the user experience. During my own recent recovery, I personally used our smart wheelchair and observed a clear improvement in safety and convenience. Importantly, we can deliver these benefits without significantly increasing the costs compared to traditional high-end electric wheelchairs, making this a more practical and accessible product for users. We have entered into framework agreements with established mobility brands who will manage branding, distribution, and aftersales services. Initial shipments are expected to begin in the second quarter of 2026, representing an early-stage commercial validation of this product category. Across the industry, more companies are starting to test and deploy service robots. We believe the next 1 to 2 years will be a validation phase, where ROI and reliability will matter most. You don’t need a robot that looks like a human. You need a robot that works every day, delivers measurable value, and is easy to operate at scale. This is exactly where our current products are positioned. Our Internet business remains strong, generating steady cash flow, which allows us to invest in AI in a disciplined and sustainable way. For more than a decade, we have built utility applications serving hundreds of millions of users. This product DNA shapes how we approach AI; rather than competing in model development, we focused on turning AI capabilities into practical tools that help users complete real tasks. During the Chinese New Year, I spent a considerable amount of effort experimenting with an AI agent system built on the OpenCloud framework. Starting from a single agent that could barely complete basic tasks, the system evolved into a multi-agent team capable of running tests continuously. In one scenario, the system generated personalized New Year messages for more than 600 colleagues and managed the entire sending workflow automatically. What we see emerging is not simply a new AI tool but a new way to organize digital work. AI agents can automate entire workflows from information gathering to processing and distribution, significantly improving productivity. Building on these learnings, we introduced EasyClaw based on OpenCloud and an open-source agent framework for both domestic and overseas markets. EasyClaw is our AI coworker platform that helps users create and deploy task-oriented AI agents capable of executing real-world tasks autonomously. At this stage, we focus on execution capability rather than scale. We are already seeing a continued increase in user engagement, as reflected in the rapid growth of our total token usage. We are building EasyClaw into an agentic operating system that changes how users interact with software and machines. By integrating EasyClaw into our PC products, we are improving user experience and driving higher conversion and ARPU. In robotics, EasyClaw allows users to program and customize robots using natural language, lowering customization barriers. This helps us deploy faster, reduce costs, and scale more easily, making our products more competitive. Some investors may ask how we compete with our training foundation models. We believe the real advantage in the agent era lies not in the model itself, but in the systems built on top of it, including task orchestration, tool usage, and cost management. By leveraging open ecosystems and leading APIs, our product can evolve as models continue to improve. Finally, our global DNA remains a core competitive advantage. We continue to expand both our AI tools and robotics businesses internationally with a disciplined approach. Looking ahead to 2026, we do not provide specific financial guidance, but we see continued structural improvements. We believe our robotics business will maintain strong growth momentum as commercial validation deepens and becomes a more important part of our revenue mix. At the same time, AI-enabled products will gradually enhance engagement and monetization efficiency across our software ecosystem. We will increasingly apply AI internally to accelerate development, aiming to further improve operational efficiency. As we grow, we will continue to improve transparency and disclosure, credibility to data, and our focus remains clear: execute with discipline and net results compound over time. Cheetah is entering its next phase of development, combining digital coworkers through AI agents and physical coworkers through service robots, supported by real operating cash flow and disciplined financial management. We are building the foundation for our next stage of growth. Thank you.

Thank you, Fu Sheng. Hello, everyone, and thank you for joining us. Unless otherwise stated, all financial figures are presented in RMB. 2025 marked a year of meaningful operational recovery and improved financial discipline for Cheetah Mobile. During the year, we continued improving operating discipline and cost structure across the company. We concentrated resources on commercially validated use cases in robotic products and practical AI applications, while leveraging open-source ecosystems and third-party models to improve R&D efficiency and optimize infrastructure costs. This approach allows us to accelerate iteration without significantly increasing fixed costs. For the full year 2025, total revenue grew approximately 43% year-over-year to RMB 1,150 million. Although we reported a GAAP operating loss of RMB 179 million for the year, this represented a substantial improvement compared with an operating loss of RMB 437 million in 2024. On a non-GAAP basis, operating profit reached RMB 14 million compared with a non-GAAP operating loss of RMB 232 million in the prior year, reflecting improved operating leverage. We ended the year with USD 215 million in cash and cash equivalents. Turning to our segment performance. Our Internet business continued to serve as a stable cash-generating platform for the company in 2025. Revenue from the Internet business increased 19% year-over-year to RMB 615 million, with Internet value-added services revenue increasing 21% year-over-year in 2025, contributing 65% of segment revenue, supported by both paying user growth and ARPU expansion. In addition, we observed that many users subscribed for periods longer than 12 months, reflecting the recurring nature of our utility applications and strengthening revenue visibility. In terms of profitability, the Internet business generated approximately RMB 115 million in adjusted operating profit in 2025, maintaining healthy margins and strong operating cash flow. As Fu Sheng mentioned earlier, the Internet business generates roughly RMB 460,000 in adjusted operating profit per working day, which provides predictable cash flow to support strategic investments in new initiatives. Looking ahead, we expect the Internet business to remain stable and profitable while continuing to provide financial flexibility for the company to invest in long-term growth opportunities. Turning to our AI and Others segment. Revenue from this segment increased 85% year-over-year to RMB 535 million in 2025; as a result, this segment accounted for 46.5% of our total revenue compared with 35.9% in 2024, reflecting the growing contribution from our emerging businesses. Within the segment, the robotics business continued to scale since the second half of 2025, making up 27% of the segment's revenue and 13% of total revenue in 2025. Robotics revenue increased 31% in 2025 driven by the deployment of the voice robot in China and continued demand for robotic arms in overseas markets. Other businesses, namely overseas advertising agencies, service, and multi-cloud management platform within this segment also contributed significantly to revenue growth, benefiting from increasing overseas expansion by Chinese enterprises. At the same time, we continued to improve operating efficiency with more selective investment and disciplined cost control. For the full year, adjusted operating loss from the AI and Others segments reduced by 42% year-over-year to RMB 274 million as we continued scaling the business while maintaining disciplined investments. Turning briefly to the first-quarter performance. Total revenue reached RMB 309 million, representing a 30% year-over-year increase and a 7% quarter-over-quarter increase, while Internet revenue declined slightly year-over-year—in the fourth quarter, it increased quarter-over-quarter as we continued shifting toward a subscription-driven business model. In addition, user subscription revenue within the Internet segment increased 32% year-over-year and 16% quarter-over-quarter as we chose to focus on a subscription business model, which supports a healthier product and user experience. Revenue from the AI and Others segment reached RMB 153 million, accounting for nearly half of total revenue in the quarter. With this segment, robotics revenues increased by 94% year-over-year and 43% quarter-over-quarter to about 19% of the fourth quarter's total revenue. Other than that, our revenues from overseas advertising agency service and multi-cloud management platform also contributed to this segment's year-over-year growth. On a non-GAAP basis, the company generated operating profit of RMB 15 million in the fourth quarter compared to RMB 42 million operating losses in the same period last year. We believe the improvement we achieved in 2025 reflected structural improvements in both our cost structure and revenue mix. Looking ahead, our priorities remain clear: disciplined growth, continued improvement in operating efficiency, balanced and disciplined capital allocation with stronger financial discipline, clearer strategic focus, and increasing contribution from our emerging businesses; we believe the company is entering a more stable and predictable operating phase. Thank you. We are now ready to take your questions.

The first question today comes from Thomas Chong with Jefferies.

Looking ahead, our priorities remain clear: disciplined growth, continued improvement in operating efficiency, balanced and disciplined capital allocation with stronger financial discipline, clearer strategic focus, and increasing contribution from our emerging businesses; we believe the company is entering a more stable and predictable operating phase. Thank you. We are now ready to take your questions. The first question today comes from Thomas Chong with Jefferies.

The company is focused on disciplined growth, improving operating efficiency, balancing capital allocation with stronger financial discipline, maintaining a clearer strategic focus, and enhancing contributions from emerging businesses. We believe this positions the company for a more stable and predictable operating phase. Thank you. We are now ready to take your questions. The first question today comes from Thomas Chong with Jefferies.

Operator, can we move to the next question?

The next question comes from Nancy Lu with JPMorgan.

Thank you. We are now ready to take your questions. The first question today comes from Thomas Chong with Jefferies. The next question comes from Nancy Lu with JPMorgan.

The first question today comes from Thomas Chong with Jefferies. Operator, can we move to the next question? The next question comes from Nancy Lu with JPMorgan.

Operator, please move to the next question. Thank you.

The next question comes from Cheng Ru Li from Guoyuan Securities.

Can we move to the next question? Thank you.

Operator, can we move to the next question? Thank you.

Operator, please move to the next question. Thank you.

The next question comes from Yongping Diao with Guotai Haitong.

Operator, please move to the next question. Thank you.

Operator, please move to the next question. Thank you.

Jing Zhu: Thank you, operator. Please move to the next question.

The next question comes from Jie Zhu with GF Securities.

Thank you, operator. Please move to the next question.

Thank you, operator. Please move to the next question.

Operator, please move to the next question.

The next question comes from Wei Feng with Mizuho Securities.

Thank you, operator. Please move to the next question.

Thank you, operator. Please move to the next question.

Operator, please move to the next question.

The next question comes from Lydia Lin with Morgan Stanley.

The next question comes from Wei Feng with Mizuho Securities. The next question comes from Lydia Lin with Morgan Stanley.

The next question comes from Wei Feng with Mizuho Securities.

Operator, please move to the next question.

The next question comes from Vicky Wei with Citi.

The next question comes from Vicky Wei with Citi.

The next question comes from Lydia Lin with Morgan Stanley. The following question comes from Vicky Wei with Citi.

Operator, please move to the next question.

The next question comes from Zeping Zhao with ICBC.

The next question comes from Lydia Lin with Morgan Stanley.

Unknown Executive

Yes. Thank you. Operator, please check if we have any further questions.

We have no further questions at this time, which concludes our question-and-answer session. I would like to turn the conference back over to management for any closing remarks.

Thank you so much for joining our conference call today. And if you have any further questions, please do not hesitate to let us know. Thank you so much. Bye.

Bye-bye.

The conference has now concluded, and we thank you for attending today's presentation, and you may now disconnect your lines.