Good day, and thank you for standing by. Welcome to the Weibo Report Second Quarter 2024 Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Sandra Zhang. Please go ahead.

Thank you, operator. Welcome to Weibo's second quarter 2024 earnings conference call. Joining me today are our Chief Executive Officer, Gaofei Wang, and our Chief Financial Officer, Fei Cao. This conference call is also being broadcast on the Internet and is available through Weibo's IR website. Before the management remarks, I would like to read you the safe harbor statement 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 of our beliefs and expectations. 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 statements. Weibo assumes no obligation to update the forward-looking statements in this conference call and elsewhere. Further information regarding this and other risks is included in Weibo'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 assumes no obligation to update such information, except as required under 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's comparative operating performance and the future prospects. Our non-GAAP financials exclude certain expenses, gains or losses and other items that are now expected to result in future cash payments, or 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.

[Foreign Language] [Interpreted] Thank you. Hello, everyone. Welcome to Weibo's earnings conference call. [Foreign Language] [Interpreted] Today, I will share with you highlights in Weibo's product monetization in the second quarter of 2024. [Foreign Language] [Interpreted] On the user front, by the end of the second quarter, Weibo's MAU reached 583 million and average DAUs reached 256 million. In light of an already sizable user community and a mature user mindset, we have proactively adjusted our user strategy this year, with more channel budget allocated to the acquisition and engagement of the high-quality users. This quarter, our DAU versus MAU ratio increased year-over-year and quarter-over-quarter, reflecting further improvement of user engagement. [Foreign Language] [Interpreted] On the monetization front, in the past two years, we have been focusing on combining Weibo's hot trend products with advertising and marketing demand, and thus, our hot trend marketing has been recognized by a wider range of industries and advertisers. In the second quarter, our total revenues reached US$437.9 million, of which our ad revenues reached US$375.3 million. On a constant currency basis, our total revenue would have increased 1% year-over-year and our ad revenues would have decreased 1% year-over-year. Our non-GAAP operating income reached US$157.6 million, representing a non-GAAP operating margin of 36%, a modest pickup year-over-year. [Foreign Language] [Interpreted] Next, let me share with you progress made in part of the monetization in the second quarter. In 2024, we still focus on growing user scale and engagement, strengthening the competitiveness of content ecosystem and improving operating efficiency as our key strategies -- strategic objectives. [Foreign Language] [Interpreted] On the channel front, we maintained close cooperation with handset manufacturers, focusing on acquisition of high-value users and promotion of user engagement. We also invested to further refine accuracy of algorithm and targeting capability of our…

Thank you, Gaofei, and hello, everyone. Welcome to Weibo's second quarter 2024 earnings conference call. Let's start with user metrics. In June 2024, Weibo's MAU reached the 583 million and average DAU reached the 256 million. As communicated last quarter, in 2024, we have proactively adjusted our user strategy to put more emphasis on the acquisition and engagement of high-quality users, as demonstrated by improved DAU versus MAU ratio this quarter. Turning to financials. As a reminder, my prepared remarks would focus on non-GAAP results. All monetary amounts are in US dollar terms and all the comparisons are on a year-over-year basis unless otherwise noted. Now, let me walk you through our financial highlights for the second quarter 2024. Weibo's second quarter 2024 net revenue was $437.9 million, a decrease of 1% or an increase of 1% on a constant currency basis. Operating income was $157.6 million, representing an operating margin of 36%. Net income attributable to Weibo reached $126.3 million, representing a net margin of 29%. Diluted EPS was $0.48. Let me give you more color on the second quarter 2024 revenue performance. Weibo's advertising and marketing revenues for the second quarter 2024 was $375.3 million, a decrease of 3% or 1% on a constant currency basis, reflecting muted ad demand amidst [indiscernible] macro environment. Mobile ad revenues were $352.3 million, contributing approximately 94% of total ad revenue. In terms of growth, 3P products, e-commerce and entertainment were the largest contributors to growth. We are delighted to see sustained ad wallet increase of handset sector this quarter, leveraging a robust content ecosystem and the dynamic discussion around 3P products. The entertainment sector demonstrated good momentum this quarter, driven by blockbuster TV programs and Weibo's unique value proposition for hot trends. On flip side, the top-line recovery will still drag…

Thank you. [Operator Instructions] We will now take the first question from the line of Alicia Yap from Citigroup. Please go ahead.

Hello, thank you. [Foreign Language] Thanks management for taking my questions. Can management comment a little bit how you view the overall macro outlook and how will that translate to your advertising outlook for the second half of this year? And then, can you share with us whether you have observed any meaningful change of the advertiser sentiment in the different industry vertical? Any particular shift of the sentiment from any advertiser that you might have observed? And also does management believe the current macro environment could actually last into next year? Thank you.

[Foreign Language] [Interpreted] Thank you very much for the question. So first of all, in terms of our advertisement revenue in Q2, from a renminbi standpoint, this was flat versus the last quarter and also year-on-year wise. And also you can see that although we've been experiencing some of the decline and also the decrease of the overall consumption, but still the willingness of placing the ads [products] (ph) from the advertisers was pretty much stable. So, in terms of the overall revenue, in Q2, we can see that there was particularly negative impact by the verticals like the cosmetics and beauty products by about 5%. But for the rest of the other industries, we're experiencing pretty much growth. [Foreign Language] [Interpreted] And also in terms of the Q3 outlook and also the second half performance, there are still some of the uncertainties in terms of the macroeconomic development, especially about the consumption. So, we remain very much cautious over the outlook for the rest of the 2024. So, still we will be experiencing some of the challenges terms of the resumption of the consumption and the macro economy in the first-tier cities, for instance. And this is, of course, going to impact some of the willingness of placing the ads by the advertisers, but still you can see that against the other players in this advertising industry, Weibo's advertising business is relatively not that big. So, still we are seeing some of the precautious behaviors of the placing ads by the advertisers. But still, in terms of the new products launch and some of the other relevant advertisements related to the new products, the customers are tending to choose those top-notch IP and also top-notch platforms to do their advertisement and also promotion. So, this is going to help…

Thank you. We will now take the next question from the line of [Suocheng Zhang] (ph) from CICC. Please go ahead.

[Foreign Language] Thanks management for taking my question. My question regards on AIGC. We noticed that the company self-developed the [iQIYI] (ph) large language model, successfully passed the legislation in July. What's our latest developments in AIGC? How does it help our content production and commercialization efficiency? Thank you.

[Foreign Language] [Interpreted] And thank you for this question. And also, first of all, previously, we have been sharing with everybody about the application of AIGC by Weibo, and the standpoint of generating content for the platform and also enhancing the interaction between the users and among users. In the second half or later stage of the July, we were hearing about the approval of the LLM that developed by Weibo and by the government. And also we use this technology to further boost and also enhance the AI products that we -- application -- we are applying now. For instance, the comment robots and also some of the AI assistance in getting the response to the users. So, we hope that the interaction based on the contents by Weibo and on a Weibo platform is going to be more intelligent and also timely fashion. [Foreign Language] [Interpreted] And also the second thing that I would like to say is that in Q2, we've been -- or in the first half of this year, also we had a better interpretation and understanding capability by this AI model especially the multimodal understanding and also interpretation of the contents on Weibo because we know that there are millions of billions of contents generated by the random users. And, also because these contents were randomly generated by the users, it was not standardized and it was not structured. And also it was not that common. I mean, following a certain pattern in terms of the total user. So, also those contents were having the image form, the video, and also text. So, at the current stage, the recommendation of those contents to the relevant target users is still based on the correct and precise interpretation and understanding of those contents. So, at the…

Thank you. There are no further questions at this time. I would like to hand over to Sandra Zhang for closing remarks.

Thanks, operator, and thank you all for joining our conference call today. We'll see you next quarter.

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