Good morning, and good evening, ladies and gentlemen. Thank you for standing by for Yalla Group Limited's Fourth Quarter and Full Year 2025 Earnings Conference Call. [Operator Instructions] Today's conference call is being recorded. Now I'll turn the call over to your speaker host today, Ms. Kerry Gao, IR Director of the company. Please go ahead, ma'am.

Hello, everyone, and welcome to Yalla's Fourth Quarter and Full Year 2025 Earnings Conference Call. We issued our earnings press release earlier today, and it is now available on our IR website as well as on Newswire outlets. Before we continue, please note that the discussion today will contain forward-looking statements made under the safe harbor provision of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, our future results may be materially different from the views expressed today. Further information regarding these and other risks and uncertainties is included in our earnings release and our annual report filed with the SEC. Yalla does not assume any obligation to update any forward-looking statements, except as required by law. Please also note that Yalla's earnings press release and this conference call include a discussion of unaudited GAAP financial information as well as unaudited non-GAAP financial measures. Yalla's press release contains a reconciliation of the unaudited non-GAAP measures to the unaudited most directly comparable GAAP measures. Today, you will hear from Mr. Tao Yang, our Chairman and Chief Executive Officer, who will provide an overview of our latest achievements and growth strategies. He will be followed by Mr. Saifi Ismail, the company's President, who will briefly review our recent business developments. Mrs. Karen Hu, our Chief Financial Officer, will then provide additional details on the company's financial results and discuss our financial outlook. Following management's prepared remarks, we will open the call to questions. Mr. Jeff Xu, our Chief Operating Officer, will join the Q&A session. With that said, I would now like to turn the call over to our Chairman and Chief Executive Officer, Mr. Tao Yang. Please go ahead, sir.

Thank you, everyone, for joining our fourth quarter and full year 2025 earnings conference call. We capped off 2025 with a solid fourth quarter, thanks to continued execution excellence. Our fourth quarter revenues reached USD 83.9 million, approaching the high end of our guidance. For the full year, total revenues rose to USD 341.9 million, driven by exceptional performance across our product ecosystem. Our revenues from game services started to gain significant traction in 2025, growing 9.1% year-over-year, benefiting from our deep dedication to our gaming business and effective marketing campaigns. We also continued to enhance profitability with net income growing by double digits, up 10.4% to USD 148.1 million. Our solid balance sheet and healthy cash flows enabled us to actively pursue new opportunities across the Middle East while also consistently enhancing shareholder returns. As highlighted in Sensor Tower's latest report, 2025 marked a year of structural divergence in the global mobile gaming industry, moving away from broad-based market growth towards submarkets with distinct economies, growth drivers and competitive dynamics. Industry performance varied significantly by region. MENA's digital entertainment market continues to surge, while mature gaming market growth pace has moderated. Amid this favorable trend, Yalla is poised to seize emerging opportunities in the MENA region and drive its next phase of growth. Several of our highly anticipated new game titles are advancing according to plan, led by official launch of our first Match-3 title, Turbo Match, during the initial rollout, we strategically leveraged the group's internal traffic resources to cost-effectively drive users acquisition for the first stage, efficiently establishing an initial user base across the Middle East. We saw good data results from previous trials, and the team is now diligently working to ensure our readiness for serving users at potentially significantly larger scale. We will gradually scale…

Hello, everyone. Thanks for joining us today. First, I would like to share our operational performance highlights in the fourth quarter. We increased MAUs by 8.2% year-over-year to 44.8 million. Refined operation and a wider variety of engagement initiatives drove user growth while also [Audio Gap] and leverage data-driven insights to enrich monetization scenarios. For paying users, we implemented targeted tiered strategies to fully unlock their spending potential. These efforts supported sustained improvements in overall user life value, highlighting an expertise and precision in guiding users throughout their life cycle. In the fourth quarter of 2025, we celebrated 101 Okey Yalla's fifth anniversary with a special campaign that achieved record high single event participation and drove both quarterly revenue to all-time highs, up more than 20% year-over-year. As the group's third self-developed title to reach 5 years of operation, 101 Okey Yalla success demonstrates our deep understanding of MENA's culturally diverse user segments and validates our ability to replicate the gaming plus social model across MENA. Last year -- in the late of last year, we received the Strategic Alliance Award at AppGallery HDC 2025 MEA Summit, recognizing our strength in technology and localization as well as our active role in promoting a more diverse, higher-quality digital entertainment ecosystem in the Middle East. This marks the second consecutive year we have earned this recognition, highlighting the depth of our commitment to technology synergy localization and joint user ecosystem development. Going forward, we will continue to work closely with our channel partners to drive tech innovation and product excellence, creating an ever-growing variety of digital experiences tailored to local culture preferences for users across the Middle East. In 2026, we will continue to optimize our core product experience and deepen localization and community operations in new and existing market, supported by keen cultural insights and an effective data-driven approach. We are confident that Yalla is well positioned to strengthen its leadership of MENA's digital entertainment market. With that, I will now turn the call over to our CFO, Karen, who will discuss our key financial and operational results.

Thank you, Saifi, and hello, everyone. Thank you for joining us today. In the fourth quarter, we continue to focus on efficiency enhancement to strengthen profitability. Our net income increased by 6.2% year-over-year to USD 34.5 million with a net margin of 41.2%, up 5.4 percentage points year-over-year. For the full year, we delivered both top and bottom line growth through our strong strategic execution and effective cost control. Our consistent efforts in the game businesses and -- are bearing fruit, driving a 9.1% year-over-year increase in the segment's revenue. Our solid balance sheet and healthy cash flow position to continue returning value to shareholders, highlighted by USD 56.6 million returned in 2025 through our existing share repurchase program and the launch of a new share repurchase program for up to USD 150 million over the next 24 months. Looking ahead, we will continue to invest in long-term growth opportunities, delivering high-quality growth and maximizing value for all stakeholders. Let's move on to our detailed financials for the fourth quarter of 2025. Our revenues were USD 83.9 million in the fourth quarter of 2025 compared with USD 90.8 million in the fourth quarter of 2024. The decrease was primarily due to a decrease in paying users as a result of few promotion events held by third-party payment platforms in the fourth quarter of 2025 compared with those held in the fourth quarter of 2024. Turning to costs and expenses. Our total costs and expenses were USD 57.2 million in the fourth quarter of 2025, a 5.7% decrease from USD 60.7 million in the same period last year. Our cost of revenues was USD 26.3 million in the fourth quarter of 2025, a 15.1% decrease from USD 31 million in the fourth quarter of 2024, primarily due to lower commission fees…

[Operator Instructions] We will now take our first question from the line of Xueqing Zhang from CICC.

And my question about your esports strategy. Could management brief us on the company's partnership with the Saudi Esports Federation, including the strategic focus and the key initiatives?

Thank you for this question, Xueqing. I will take this question. Our strategic partnership with the Saudi Esports Federation, also known as SEF, represents a key step in deepening our presence in Saudi Arabia, while aligning with the Saudi government's Vision 2030. Serving as the official event partner of the Saudi eLeague 2026 will meaningfully enhance our brand visibility in Saudi, one of our most important growth markets. Moreover, we will also support women's Saudi eLeague, helping cultivate female esports models and encouraging significantly broader participation by Saudi women in digital entertainment. This closely aligns with our commitment to promoting inclusion and community development. In addition, we will collaborate with the SEFs Saudi Esports Academy to launch a talent development program designed to foster local esports talent, through training, mentorship and competitive experience, the Saudi eLeague 2026 is now in progress. We look forward to sharing further details on our partnership as the event unfold. We believe this will enable us to cultivate deeper connection with users in Saudi market and strengthen our regional influence, positioning the company to capture sustainable growth opportunities and deliver long-term value. Notably, this collaboration is not limited to a single tournament. It opens the door to broader possibilities. Looking ahead, we plan to explore additional partnerships with esports tournament operators top-tier game publishers and content creator ecosystem players across the Middle East and other high-growth emerging markets to jointly build a cross-regional digital entertainment ecosystem.

We will now take our next question from Chloe Wei from CICC.

So my question is about the macro environment. So could management maybe share the perspective on the evolving macro dynamics in the Middle East and its implications for the company?

Thank you, Chloe. This is Saifi. I will take this question. The recent developments in the Middle East are top of mind of investors. We do not have any operations in Iran or Israel. In the Gulf countries, we have responded promptly to government guidance and have arranged for our employees to work from home. Our immediate priority is ensuring the safety and well-being of our employees throughout the region. Operationally, based on our recent performance data, there has been no material revenue variation over the past 2 weeks. The overall impact appears limited at this stage. Given that our business operates online, user demand for community engagement and real-time emotional connection during these periods may still persist based on our recent observation. We will continue to closely monitor the situation. We stand ready to adjust our strategy as the situation evolves.

We will now take our next question from the line of Tianhao Liu from Citic.

I would like to follow up on the pipeline. Could management provide an update on the product rollout and the marketing schedule?

Thank you, Tianhao for your question. For our first Match-3 title, Turbo Match, during the initial rollout, we strategically leveraged the group's internal traffic resources to cost effectively acquire our first group of users. We saw encouraging test data, and our team is now diligently preparing to serve users at a potentially large scale. Starting Q2, we gradually increased our investment in external marketing to reach a broader pool of potential users and progressively build this revenue stream. Meanwhile, our desert-themed SLG title collaborated with a top-tier studio is currently in the final stage of product optimization. We're targeting its official on-scale promotion in Q2. As is typical in the gaming industry for these 2 new games, monetization and growth will ramp up in stages over time. At this point, we expect our mid-core and hard-core games to start generating more meaningful revenue contributions in the second half of this year. We'll keep you updated.

We will now take our next question from Xiaoyue Hu from Haitong.

Can management share more details on the company's proprietary AI model and its future direction in the AI domain?

Thank you, Xiaoyue. We continue to ramp up our AI investment and have made notable progress. Our in-house developed multimodal AI model, [ CMIS ], is constantly learning from massive Arabic language data sets and user behavior data, continuously refining content recognition accuracy, cultural context understanding and risk anticipation. [ CMIS ] has achieved industry-leading performance in MENA in analyzing text and images and detecting inappropriate content, significantly enhancing our content moderation efficiency and platform safety. The integration of AI in marketing also significantly helps us to optimize our marketing budget and reduce expenses. Beyond multimodal AI model, our team is also actively researching and testing AI-related integrations for our products, including AI-assisted content creation tools to encourage engagement and interactions in our online community and drive user enthusiasm. Looking ahead, we will deepen the integration of AI across product development, risk management and end-to-end operational workflows to improve efficiency and drive innovation. We will share additional product level developments once we achieve more substantive breakthroughs.

We will now take our next question from Lincoln Kong of Goldman Sachs.

So the first one, could management share your guidance for revenue and profitability for 2026? And I have another question is what's the company's medium-term to longer-term strategy for the gaming business?

Thank you, Lincoln. This is Karen. For the first question, looking ahead to 2026, our flagship products remain highly resilient, and we expect revenue from our mature existing businesses to remain flat and the margin to remain stable at around 40%. As we gradually launch and promote new gaming products, we expect our mid-core and hard-core gaming businesses generating revenue in the second half of this year and emerge as a new growth driver. Regarding profitability, we will adopt a more dynamic management approach to optimize margins. We expect R&D spending to follow a trajectory similar to that of 2025, while marketing investments will be flexibly adjusted in line with new product performance. Our current sales and marketing budget for new game is 5% of group's revenue. So we will adjust it flexibly based on ROI and market feedback. We will continue to drive long-term growth through innovative business initiatives, ensuring a disciplined approach for margin stability. For the second question, I will leave Jeff. Thank you.

Lincoln, for the second question, thank you for this insightful question. From a medium- to long-term perspective, our gaming strategy is built on the dual approach of consolidating our core portfolio while also expanding into new growth segments. On the core side, we continue to strengthen our casual gaming foundation. Beyond our flagship titles, Yalla Ludo and 101 Okey Yalla, we're adding new casual product lines and driving ongoing feature innovation to optimize user cycle value. On the expansion side, we remain committed to investing in mid-core and hard-core games under a clearly defined 2-pronged road map, utilizing in-house development for mid-core titles and partnership-based publishing for hard-core games. In mid-core categories such as Match-3 and board games, we are leveraging years of accumulated expertise to scale in a systematic and disciplined manner. In hard-core genres, particularly SLG, we are collaborating with top-tier global developers. We are capitalizing on our competitive strength in localized publishing, distribution and operations. From a market selection standpoint, we remain highly focused on the Middle East as our core strategic market, fully tapping its monetization upside. We're not ruling out global markets like North America and Europe markets for categories with global appeal such as Match-3 once product market fit and operating traction are validated. We believe this targeted yet flexible strategy positions us to build sustainable competitive advantages over the long term.

We will now take our next question from [ Tianyu Guo ] from Nomura.

My question is about the capital return. Could management share more details on the share repurchase program announced earlier?

Thank you. Thank you, Guo. So highlighting shareholder returns. In 2025, we efficiently delivered on our share repurchase commitment, executing a total repurchase of USD 56.6 million for the full year. The company will cancel all share repurchased in 2025, a process that is underway and has been well received by the market. Entering into 2026, we will first execute the remaining USD 44 million repurchase value available under the existing program before it expires. Additionally, the company's Board of Directors has authorized a new share repurchase program effective from March 9, 2026, through March 8, 2028, for up to USD 150 million for the company's shares. This large-scale authorization reflects our commitment to maximizing shareholder value, directly underscoring management's strong confidence in the company's business outlook and the medium- to long-term value. We will consistently place shareholder interest at the core of our capital allocation decisions, returning value to investors through a continuously optimized return framework. Thank you for your question.

Thank you. As there are no further questions now, I'd like to turn the call back to management for closing remarks.

Thank you once again for joining us today. We look forward to speaking with you in the next quarter. If you have further questions, please feel free to contact Yalla's Investor Relations or Piacente Financial Communications. Both parties' contact information is available in today's press release as well as on our company website. Thank you.

This concludes this conference call. You may now disconnect your lines. Thank you.