Good day and good evening. Thank you for standing by. Welcome to Tencent Holdings Limited 2022 third quarter results announcement webinar. I'm Wendy Huang from Tencent IR team. At this time, all participants are in a listen-only mode. After management's presentation, there will be a question and answer session. For participants who dial in by phone, if you wish to ask a question, please press five on your telephone to raise your hand. If you are accessing from the Tencent Meeting or Zoom Meeting application, please click the raise hand button at the bottom left. Please be advised that today's webinar is being recorded. Before we start the presentation, we would like to remind you that it includes forward-looking statements, which are subject to a number of risks and uncertainties, and it may not be realized in the future for various reasons. Information about general market conditions is coming from a variety of sources outside of Tencent. This presentation also contains some unaudited non-IFRS financial measures that should be considered in addition to, but not as a substitute for measures of the group's financial performance prepared in accordance with IFRS. For detailed discussion of risk factors in the non-IFRS measures, please refer to our disclosure documents on the IR section of our website. Let me now introduce the management team on the webinar tonight. Our Chairman and CEO, Pony Ma, will kick off with a short overview. President Martin Lau will discuss strategy review. Chief Strategy Officer James Mitchell will provide a business review. Chief Financial Officer John Lo will conclude with financial discussion before we open the floor for questions. I will now pass it to Pony. Thank you, Wendy. Good evening. Thanks everyone for joining us. During the third quarter, we streamlined our costs and activated new revenue generating services, returning to year-on-year earnings growth. We also delivered quarter-on-quarter earnings growth with some tailwind from positive seasonality. Total revenue was RMB 140 billion, down 2% year-on-year, but up 5% quarter-on-quarter. Gross profit was RMB 62 billion, down 1% year-on-year, but up 7% quarter-on-quarter. Non-IFRS operating profit was RMB 41 billion, flat year-on-year and up 12% quarter-on-quarter. Non-IFRS net profit attributable to equity holders was RMB 32 billion, up 2% year-on-year and 15% quarter-on-quarter. For our key services, we generally retained our first-place positions in activities, including social, games, long-form video, news, music, literature, payment, and mobile browser. Combined MAU of WeChat and Weixin was 1.3 billion. Mobile devices MAU of QQ was 574 million. I will now hand over to Martin Lau for a strategy review. Thank you, Pony, and good evening and good morning to everybody. In last quarter's strategy review, I discussed how we have positioned ourselves to improve efficiencies, develop new revenue streams, and so revive our profit growth. Today, I will update you on our progress and some early-stage results. In addition, I will touch on our latest steps in returning capital to shareholders. Let's start off with the progress of our efficiency initiatives. First, we further tightened our control on marketing costs, pulled back from projects with low cost efficiency, and focused our resources on core products. As a result, selling and marketing expenses decreased by 32% year-on-year and by 10% quarter-on-quarter. Second, we achieved a significant margin improvement in business services. Gross profits grew both year-on-year and quarter-on-quarter, benefiting from our proactive adjustment to generate high-quality revenue. Third, we optimized bandwidth and server utilization associated with Video Accounts, bringing down our operating costs per video view significantly. Fourth, with our rationalization in non-core and underperforming businesses, we optimized our workforce and controlled staff cost. At the end of the third quarter, our total headcount was down as compared to the end of the first quarter. Excluding severance pay, total staff costs increased at a low single-digit growth rate year-on-year. While the macro environment is still challenging, our efficiency initiatives enabled us to achieve slightly positive year-on-year growth in profits, representing a significant improvement over the last few quarters. Looking forward, we are making encouraging progress in developing new high-quality revenue streams in the following three key growth areas. For Video Accounts, in-feed ads revenue has been ramping up fast since we made additional inventory available on putting basis in mid-August. We are on track to exceed RMB 1 billion in quarterly revenue in the fourth quarter. For international games, we launched new hits Tower of Fantasy and Goddess of Victory: Nikke, demonstrating our strong publishing capabilities. Our new strategic partnership with Ubisoft will enable us to bring more Triple-A franchises to mobile globally and PC titles to China. Together with a growing pipeline of our group of studios across genres and platforms globally, our international games business is well-positioned for significant expansion over time. For SaaS, we are currently prioritizing scale and expansion as there are precedents in the rest of the world which demonstrate how these services can be monetized by industry leaders. We have recently launched a subscription bundle combining WeCom, Tencent Meeting, and Tencent Docs together, which is seeing good adoption among larger enterprises. In addition, we are encouraged to see positive signals across the path of macro and regulatory normalization. For Fintech services, commercial payment volume growth recovered in the third quarter. On the regulatory front, we received approval for investment in Samsung Property & Casualty Insurance in China. For domestic games, we received approval for a new game publishing license and an amendment to an existing license in September. We believe more licenses will be forthcoming in the future. For advertising, revenue grew quarter-on-quarter, even excluding new contribution from Video Accounts in-feed ads. We are on track to resume year-on-year growth in late 2022. Next, I would like to update you on our capital allocation, which we start from a position of both cash flow and asset strength. We operate a diversified portfolio of businesses spanning across social networks, games, advertising, and Fintech services, each of which generates robust cash flow even under the current environment. Consequently, we generated operating cash flow of $25 billion over the past 12 months. After taking into account payments for capital expenditure, media content, and lease liabilities, our free cash flow amounted to $15 billion. On the asset side, as of the end of September 2022, we have total gross cash of $44 billion, stakes in listed companies with a fair value of $75 billion, and stakes in unlisted companies with a carrying value of $48 billion. This combination of cash flow generation and liquid asset holdings enable us to simultaneously invest in our business while returning capital to shareholders. We believe we are fully supporting organic and strategic investments which benefit our business. For organic investments, we are deploying capital into growth areas we have highlighted, namely Video Accounts, international games and SaaS products, as well as ecosystem enhancements such as nurturing a vibrant e-commerce ecosystem for Weixin and upgrading our backend infrastructure. For strategic investments, we continue to invest in companies that are complementary to our core business growth, such as our recent investments in and partnership with Ubisoft and FromSoftware, to name a couple. At the same time, we are also returning more capital to shareholders. For the past 10 years, we paid out cash dividends which represented a payout ratio of approximately 10% of our non-IFRS earnings. Since the beginning of the year, we have bought back $3 billion worth of shares. In March 2022, we paid a dividend in kind through distribution of JD.com shares, which amounted to $13 billion of value to shareholders. To date, we have returned a total of over $18 billion to our shareholders. Today, we are declaring a special interim dividend of Meituan shares worth approximately $20 billion, which will be distributed to shareholders in March 2023. Qualifying shareholders will receive 1 Meituan share for every 10 Tencent shares they hold. This distribution in kind is equivalent to about HKD 16.6 per Tencent share based on yesterday's closing price. With that, I'll pass to James to talk about our business review. Thank you, Martin. For the third quarter of 2022, our total revenue was down 2% year-on-year. VAS represented 52% of our total revenue, within which the social network sub-segment was 21%, domestic games 22%, and international games 9%. Online advertising was 15%, and Fintech and business services was 32% of total revenue. The value-added services segment revenue was 72.7 billion renminbi, down 3% year-on-year. Social network revenue was down 2% year-on-year to 29.8 billion renminbi. Revenue from music and game-related live streaming services decreased, while revenue from Video Accounts live streaming service increased, reflecting more users, additional content, and enhanced recommendation efficiency to better match users to content. Tencent Video subscription revenue decreased slightly year-on-year as content scheduling delays resulted in subscriptions dipping. However, we increased ARPU as we adjusted membership pricing. Our self-commissioned drama series, Love Like the Galaxy, which we released in July, ranks number one by video views across all online platforms in China for the quarter. Our music subscription revenue increased year-on-year, driven by more paying users. Our domestic game revenue was down 7% year-on-year to CNY 31.2 billion as transitional challenges resulted in lower paying user counts. Honor of Kings and Peacekeeper Elite contributed decreased revenue due to the minor protection measures which took effect from September 2021 onwards. New games Wild Rift, Return to Empire, and League of Legends Esports Manager contributed incremental revenues. Our international games revenue increased 3% year-on-year or 1% in constant currency terms to CNY 11.7 billion. A robust performance from VALORANT, the successful launch of Tower of Fantasy, and Miniclip's acquisition of Subway Surfers and release of new games drove the growth. Turning to social networks, we leverage the extensive reach of Weixin and the ease of use of Mini Programs to better assist the real economy. Mini Programs surpass 600 million daily active users, representing a year-over-year increase of more than 30%. Daily Mini Program activations grew even faster by over 50% year-over-year. Additional commerce and municipal service use cases contributed to growing the number of users and the daily activations per user. We deepened the adoption of Mini Programs among food and beverage, apparel and footwear brands, and shopping malls and department stores. These offline merchants and brands are increasingly integrating membership programs and loyalty points into their Mini Programs as they build out multi-channel retail. The health code Mini Programs helped users verify their health and travel status with over 320 billion visits year-to-date, facilitating continuity of business activity. On QQ, we provided more scenarios in Super QQ Show for social interaction. We collaborated with brands such as Gucci and KFC to launch virtual spaces where users can conduct immersive interactions. For example, users can participate in online-to-offline campaigns, collect branded virtual items, and socialize with other fans. Moving to domestic games, with the implementation of our industry-leading minor protection program, we've become fully compliant with Chinese government regulation, fostering a healthier industry environment. Time spent from users aged under eighteen years old has decreased by 92% year-over-year and constituted 0.7% of total time spent in July 2022. On the other hand, our adult user base and user engagement increased year-over-year. For the month of September, our combined PC and mobile game adult DAU rose by a double-digit% year-on-year, and our total adult player time spent grew by a single-digit% year-on-year. Time spent growth was driven by existing titles such as Honor of Kings, Peacekeeper Elite, and CrossFire on mobile and PC, as well as new titles such as Wild Rift and Arena Breakout. We're extending the longevity of our IP franchises. Taking one example, CrossFire, which is a game we first published on PC 14 years ago. As a result of innovation in areas such as player versus environment mode and ranked mode, CrossFire PC remains the leading game in the FPS genre on PC in China and grew its grossing receipts by a high single-digit% year-on-year in the first 9 months of this year. In 2015, we published CrossFire Mobile, developed by TiMi Studio Group, significantly increasing the overall number of people playing CrossFire games in China. Benefiting from localized content insights, CrossFire Mobile remains one of the top 10 mobile games by time spent and grossing receipts in China today. We continue enriching the CrossFire franchise professional esports events and cross-media collaboration, such as a live-action drama series on Tencent Video. International games were extending the success of our key internally developed franchises. Benefiting from Riot's esports experience, the VALORANT Champions tournament became the most popular esports event industry-wide for tactical shooter games, expanding VALORANT's fan base and driving record high grossing receipts for the game itself in the third quarter. In October, Supercell released the biggest ever content update, Town Hall 15 for Clash of Clans, which boosted user engagement and in-game consumption. Clash of Clans represents a lasting franchise, generally ranking as the top strategy game by annual grossing receipts worldwide since its launch, including year-to-date this year. We've also achieved breakthroughs in publishing investee studio and licensed games with the release of two major new titles leveraging our content marketing and user community management capabilities. Tower of Fantasy, an open-world MMORPG developed by Perfect World, which we released in August, became the second most popular MMORPG by daily active users internationally in the quarter. It achieved notable commercial success in the most competitive markets, ranking first by grossing receipts in Japan and second in the United States. Nikke, a sci-fi RPG shooter with anime graphics developed by our investee studio, Shift Up, was the highest-grossing mobile game internationally in the first ten days following its November launch. Nikke's success demonstrates how we can empower small investee studios to commercial success with our operational know-how and infrastructure scale. For online advertising, our revenue was CNY 21.5 billion in the third quarter. The rate of year-on-year decline has narrowed from 18% in the second quarter to 5% in the third quarter, benefiting from initial monetization of Video Accounts in-feed ads, improvements in the games, e-commerce, and FMCG categories, and lapping of certain industry-specific headwinds from 2021. Sequentially, our advertising revenue grew 15%, benefiting from positive seasonality, the initial monetization of the Video Accounts in-feed ads, and our ongoing efforts to improve ad targeting technology. For Video Accounts, we saw particularly robust demand from the FMCG and high-end brands. Advertising in Video Accounts is complementary and incremental to our existing advertising revenue. Excluding Video Accounts, ad revenue elsewhere in Weixin grew year-over-year, particularly from Mini Programs. Within the media subcategory, our long-form video ad revenue decreased year-over-year, primarily due to fewer releases of drama series and tough comparisons versus airing the Tokyo Olympic Games in the year-ago period. Looking at fintech and business services, segment revenue was CNY 45 billion, up 4% year-over-year and 6% quarter-over-quarter. For fintech services, year-over-year revenue growth was higher compared to the previous quarter, mainly benefiting from a recovery in commercial payment activities, both offline and online. Our commercial payment volume achieved double-digit year-over-year growth, with notable expansion in categories such as groceries, dining services, and transportation. For business services, our revenue declined slightly year-over-year. However, gross profit increased significantly both year-over-year and quarter-over-quarter. Gross profit growth benefited from us exiting or scaling back certain loss-making activities, such as deeply discounted contracts for content delivery network, and also from us shifting the revenue mix toward internally developed products and away from projects with a high proportion of subcontracting activity. We're striving to help non-internet industries embrace digital transformation, which is boosting our revenue from offline sectors such as financial services, industrials, and automotive. Highlighting a few examples of our industry solutions. Tencent Cloud Enterprise enables those customers, such as banks and municipalities, who prefer to store data on their private clouds to integrate and deploy our public cloud products within their private clouds. Tencent Cloud AI Digital Humans provides AI chatbots to customers in sectors such as financial services and tourism, enabling automated customer support. Tencent Real-Time Communication is increasingly deployed in industrial use cases, such as enabling remote control for mining and container trucks so that our customers can scale their operating costs and provide their drivers with a safer working environment. Public sector organizations such as hospitals and schools are increasingly using our key software-as-a-service tools, facilitating their efficient collaboration and online education provision. Now I'll pass to John. Thank you, James. Hello, everybody. For the third quarter of 2022, total revenue was RMB 140.1 billion, down 2% year-on-year or up 5% quarter-on-quarter. Gross profit was RMB 62 billion, down 1% year-on-year or 7% quarter-on-quarter. Net other gains were RMB 20.9 billion, down 9% year-on-year or up 373% quarter-on-quarter, which were mainly non-IFRS adjustment items, such as net gains on deemed disposal and disposals of certain investments, including a RMB 41.3 billion gain from deemed disposal of Sea, net fair value losses from the revaluation of certain investments and impairment provisions against certain investment in online entertainment and fintech verticals. Operating profit was RMB 51.6 billion, down 3% year-on-year or up 72% quarter-on-quarter. Net finance costs were CNY 2 billion, largely flat year-on-year or up 8% quarter-on-quarter. The QoQ change was mainly due to increased interest expense, partly offset by increased foreign exchange gains. Share of losses of associates and JVs was CNY 3.7 billion compared to CNY 5.7 billion last year. Non-IFRS share of profits was CNY 2.4 billion compared to share of losses of CNY 0.3 billion last year, reflecting improved profitability at certain domestic associates due to their cost control measures. Income tax expense increased by 30% year-on-year to CNY 7.1 billion, mainly due to the provision of withholding tax during the quarter. The effective tax rate was 15.5%. IFRS net profit attributable to equity holders was CNY 39.9 billion, up 1% year-on-year and 115% quarter-on-quarter. Diluted EPS was CNY 4.104, up 0.7% year-on-year or 114% quarter-on-quarter. On non-IFRS basis, operating profit was CNY 40.9 billion, largely stable year-on-year or up 12% quarter-on-quarter. Net profit attributable to equity holders was CNY 32.3 billion, up 2% year-on-year or 15% quarter-on-quarter. Diluted EPS was CNY 3.306, up 1% year-on-year or 14% quarter-on-quarter. Moving on to gross margins. The overall gross margin was 44.2%, stable year-on-year or up 1 percentage point quarter-on-quarter. Gross margin for VAS was 51.7%, down 1.3 percentage points year-over-year or up 1.1 percentage points quarter-over-quarter. The YoY margin decrease is mainly due to a revenue mix shift from higher margin game services to lower margin Video Accounts live streaming service. The QoQ margin improvement reflected our cost optimization efforts within the segment. Gross margin for online advertising was 46.3%, broadly stable year-over-year or up 5.7 percentage points quarter-over-quarter. The QoQ margin improvement benefited from the initial monetization of Video Accounts in-feed ads, as well as efficiency measures we implemented within the segment. Gross margin for fintech and business services was 33.3%, up 4.8 percentage points year-over-year or stable quarter-over-quarter. The year-over-year margin improvement was driven by our proactive efforts to reduce loss-making cloud services activities, leading to a healthier revenue mix and reduced cost base. On operating expenses, salary and marketing expenses decreased to CNY 7.1 billion, or 5.1% of revenues due to cost efficiency initiatives Martin Lau mentioned earlier. R&D expenses were CNY 15.1 billion, up 10% YoY, or broadly stable QoQ. The year-over-year increase was driven by higher staff costs. R&D expenses were 10.8% of revenues. G&A expenses excluding R&D were CNY 11.4 billion, up 12% year-over-year or 2% QoQ. The year-over-year increase was due to higher operating lease and office expenses as well as staff costs. At quarter end, we had approximately 109,000 employees, up 1% year-over-year or down 2% quarter-over-quarter. Let's take a look at our operating and net margin ratios. Non-IFRS operating margin was 29.2%, up 0.5 percentage point year-over-year, or 1.8 percentage points quarter-over-quarter. Non-IFRS net margin was 23.8%, up 1 percentage point year-over-year or 2.2 percentage points quarter-over-quarter. Finally, I will summarize some key cash flow and balance sheet metrics. Total CapEx was CNY 2.4 billion, down 66% year-over-year or 21% quarter-over-quarter. Within total CapEx, operating CapEx was CNY 1.1 billion, down 81% year-on-year or 49% quarter-on-quarter. As we proactively reassess and tighten our spending plan for the year, non-operating CapEx decreased by 9% year-on-year to CNY 1.3 billion. Operating cash flow for the quarter was CNY 41 billion, stable year-on-year or up 15% quarter-on-quarter. Free Cash Flow for the quarter was CNY 27.6 billion, up 15% year-on-year or 23% QoQ, reflecting our disciplined CapEx spending. Net debt position was CNY 27.3 billion compared to CNY 20.4 billion last quarter. The sequential change was due to the effect of foreign currency translation differences on our U.S. dollar-denominated debts, partly offset by stronger free cash flow generation. Thank you. Thank you, John. Now we are open the floor for the questions. If you are dialing in by phone, please press five to raise a question and then press six to unmute yourself. If you are accessing from the Tencent Meeting or VooV Meeting application, please click the Raise Hand button at the bottom left. We will take one main question, up to one main, one follow-up question each time. Our first question will come from William Packer from Exane BNP Paribas. Hi, management. Many thanks for taking my question. Firstly, cost progress in recent quarters has been an important support for a return to profit growth, even though G&A costs continue to grow. Am I correct to think that this growth includes one-off restructuring costs associated with headcount reduction and other savings? Could you quantify those one-off costs to help us think about underlying cost growth? Secondly, my follow-up, in terms of domestic gaming, top-line momentum has weakened again. How should we think about a return to top-line growth for that segment? Do you need new IP from future game approvals, or can the easing of the minor gaming revenue headwind comps and potentially improving macro be sufficient? Thank you. Yeah, you are right that we have included all the one-off restructuring costs in G&A ex R&D under staff costs. Total IFRS G&A ex R&D severance payment, well, on year-over-year basis, it would have increased by very low single digit. We can, well, quantify it using this basis. Will, on the domestic game question, you know, you called out the right three factors which, you know, have been hindering the industry growth and our growth, namely minors protection measures, the lack of new game licenses, which is very important in a supply-driven industry, and also the challenging macroeconomic environment. Now, in terms of what it would take for us to successfully reboot our domestic game revenue growth, then, you know, the industry and we are lapping the minors protection measures as of September from a gross receipts perspective. Of course, there's a few months in which the gross receipts from prior quarters get amortized into our P&L, but that effectively is behind us on a cash flow basis. We believe that in order for the revenue growth to sort of notably and sustainably re-accelerate, we would likely benefit from one of the other two changes coming through. In terms of the other two factors, then we expect, you know, more new game licenses for more commercial games to come through relatively quickly. On the other hand, you know, we don't have any great insight into when the macroeconomic improvement will turn up. Of course, if both of those factors turn positive, then, you know, we would see a faster rate of game revenue growth. One of those factors turning positive alongside the lapping in minor protection measures, you know, we think would be sufficient to answer your question positively. Well, next question comes from Edward Leung from Bank of America. Eddie, your line is open. Good evening. Go ahead. Good evening. Two questions on your pieces. Maybe the first one to follow up on the questions about games. With fewer licenses for domestic, are we going to change our development strategy for the upgrade of the existing games in order to maximize kind of like the lifetime value? That's now the first question. Secondly, regarding to the Video Accounts advertising, could you provide some feedback you have heard from advertisers? Yes. Maybe your return on investment, et cetera, and any area for further improvement. Thank you. Yeah. Thank you, Eddie. In terms of the fewer domestic game licenses and change to our game development strategy, then, you know, we have indeed changed our game development strategy, although the full effects of the change will, you know, take a few quarters to show through. First of all, we're focusing our resources on, you know, fewer, bigger, higher impact, higher production value, new games. You know, many of those new games also have global aspirations as opposed to purely single country aspirations. Secondly, we are indeed spending more time and resources upgrading and energizing our big existing games, and we talked at length about the example of CrossFire in the opening remarks. Thirdly, we actually do believe that, you know, further issuance of new game licenses in the near future. To some extent, this, you know, headwinds to the game industry will mitigate as more new games are released. Secondly, on your question around advertiser response to the in-feed ads on the Video Accounts, you know, I would say that the first noteworthy point is that Video Accounts actually deliver quite a differentiated audience, who, you know, by and large are not consuming other short-form video services. In comparisons to the rest of the industry where there's a very high overlap between users of service A and service B and service C and service D, you know, Video Accounts is a differentiated audience, and you know, advertisers like that because they can reach people whom they otherwise weren't able to reach on incumbent platforms. That in turn has meant that Video Accounts is particularly popular with, you know, advertisers who value that additional reach, such as fast-moving consumer goods companies and such as high-end brands. Which in turn has meant that the ECPM that we're achieving on Video Accounts is very robust. You know, it's at a premium to any of the incumbents, and it's also at a premium to Weixin Moments. Now in terms of, you know, areas for improvement from an advertiser feedback, the key area for improvement in their eyes is simply that we, that they would like to purchase more inventory, and therefore, they would like us to release more inventory, which, you know, we are periodically doing. Right now, we're in an excess demand situation. Thank you. Thank you, Eddie. Thank you. Our next question comes from Alicia Yap from Citi. Hi. Make sure your line is open. Hi. Good evening, management. Can you hear me? Yes, we can. Okay. Yeah. Thank you for taking my questions. Congrats on the solid profit beat and also the Meituan dividend. I have two questions. First one on the online advertising. We observed that the ad budget as related to the event sponsorship and also the brand awareness campaign seems to be experienced a little bit more stable budget allocation lately as compared to the traffic lead ad dollars in the past few years. Given Tencent diversified media properties across, you know, for example, Tencent Music, Video Accounts, you know, the moments, will this actually position Tencent to have a stronger value proposition to gain more advertiser mind share with the economy gradually rebound? My follow-up questions is on the gaming. We also notice, I'm not sure if we are correct, it seems like the PC games did show a little bit more resilient in retaining the existing gamers and also attracting some of the return gamers. Will we actually also reallocate more development resource to introduce more content update on some of the older PC games to revive the gamers' interest? Thank you. Thank you, Alicia. On the advertising question, you know, in general, the China online advertising market is primarily or predominantly performance ads and then a minority of branded ads. Within the performance ads, there's contractual performance advertising where, you know, the advertiser desires performance measured by sort of traditional awareness and reach metrics as well as transactional metrics. There's more purely transactional performance advertising, where the advertiser is very purely focused on transactional metrics, and that would be true for, you know, perhaps mobile game companies, e-commerce companies and so forth. You know, I think that Tencent plays across all of those. Obviously, our historic strength is more within the branded advertising. In recent years, as we have nurtured a very substantial gross merchandise volume flow through our Mini Programs, we have created more sort of native or endemic demand for performance advertising, both contractual performance and transactional performance. More recently, with the release of advertising inventory in Video Accounts and in the future. Advertising inventory within our search engine, then we think we have the right, you know, inventory, that is especially suitable for the, transactional performance advertisers. Historically, we were sort of most suited to the branded advertisers and the contractual performance advertisers. Increasingly we have both the use case and the ad inventory that is suitable for transactional performance advertisers. On your game question around PC games, yes, we are, as I mentioned in response to Eddie's question, you know, investing more in our big existing games. It's also the case that we have a number of, you know, PC games in development, globally. You know, some of them are pretty substantial. Riot VALORANT is a PC-first game, and that's become one of the most successful PC games across the industry, both in terms of critical reception, but also in terms of becoming a billion-dollar annual revenue franchise. Many of the game studios we have acquired in the past five years outside China are PC game first. If you look at Steam today, I think the number two title behind Call of Duty is Warhammer 40,000: Darktide, which is created by a studio called Fatshark in Europe, in Sweden that is one of our subsidiaries. That game actually hasn't launched yet, but it's the number two or number three game in Steam rankings. China studios have become somewhat mobile first, and, you know, for them, when they release PC games, it's often a situation where the game is released across both mobile and PC and interoperable. The game sort of crafted with mobile front of mind, versus many of our overseas studios like Riot and Fatshark are, you know, PC first and then move the PC game to other platforms later. Thank you. Thank you, Alicia. Our next question comes from Gary of Morgan Stanley. Gary, your line's open. Hi. Thank you for the opportunity, and congratulations on the strong results. I have two questions. The first one is a follow-up on Video Accounts. I think you mentioned that Video Accounts seems to be complementary to our Weixin ad platform and also kind of differentiated from other short video peers. When this platform becomes a bigger kind of ad revenue pool, how should we think about where the ad budgets are going to come, you know, coming from? Is it more from other short video peers, you know, other formats ads? You know, by that time, should we expect inevitably some kind of cannibalization on our existing kind of ad revenue from other platform? A follow-up question is related to our investment portfolio. Given our criteria is to, you know, consider divestment when subsidiary or when the associates become more kind of financially capable in strength, with, you know, industry leadership. When I look at the rest of the portfolio, it seems like there are some other sizable associates which have reached that kind of status or definition. How should we think about, you know, those associates we are, you know, which are, you know, approaching the Meituan kind of mature state? Thank you. In terms of video, Video Accounts right now, I think very clearly, as we have seen from the evidence, that monetization is actually incremental for us. There are a number of aspects of it. Number one is that the time that people spend on Video Accounts is actually purely incremental, and it's actually a very sizable amount. That's one. Two is, in terms of the revenue, we saw the budget as being incremental because, you know, when we start scaling the Video Accounts revenue, it actually reach a significant scale. In fact, we talk about it's on track to reach CNY 1 billion per quarter. That ramp-up is actually achieved without impacting any other of our advertising revenue or advertising budget as put in by the advertisers. We also view Video Accounts as very complementary to our ecosystem as it actually works very well with our Mini Programs as well as other parts of our ecosystem, including Official Accounts, including WeCom. The ecosystem as a whole actually help the merchants to build a private domain for them. In the past, the merchants can only bring traffic to the Mini Programs through offline touchpoints and some advertising on our Weixin ecosystem. Now, the Video Accounts actually allowed a considerable amount of ad inventories to be added, and the traffic can be through Video Accounts, it can be through Video Accounts live streaming, and that actually allows the merchants to really bring much more traffic into their Mini Programs, and that as a whole really complements the overall ecosystem of Weixin. In terms of where the revenue will be coming in, right, I think, you know, part of it is actually from existing revenue that's spent on other short video platforms. Some of the revenue will be actually coming from e-commerce, right? Because as the merchants want to build their private domain, they may actually look at the spending that they put in all other channels and try to build something which is of. Highest value to them, which we believe private domain is. It also involves some of our existing advertisers just spending more money on our platform. Gary, in terms of your question around the strategic thinking around distributions and, you know, comparing the Meituan distribution with the prior JD distribution, then if you look at the Meituan announcement on page seven, there's a section called Reasons For And Benefits Of The Distribution In Kind, right? It's actually distribution in specie, but I'm not sure how to pronounce specie, so we'll say it's distribution in kind. There we give, you know, three criteria, which are among the criteria we consider when we're deciding whether it's appropriate to distribute an investment. You know, one of those criteria is the financial strength of the investee. A second one is the industry positioning of the investee, and a third one is our investment returns. If you look at, you know, Meituan for example, through that lens, then, you know, in terms of industry positioning, it's obviously, you know, extremely strong being, you know, the clear leader in food delivery and in-store and so forth. If you look at the investment returns, then we've had, you know, very good returns on the investment of around 30% IRR. If you look in terms of financial profile, then, you know, it is profitable. It's not as profitable on a headline basis as JD was when we distributed, but that's because Meituan, as you well know, is investing in community group buying and other new services to expand its addressable market longer term. Anyway, those are, you know, three of the criteria that help explain our thinking around distributions, and, you know, specifically why we chose to distribute JD and why we now choose to distribute Meituan. Thank you. I would add to the fact that we obviously want to distribute the shares from a point of strength, right? You know, as we look at what James talked about in terms of strength in financial profile, in industry position. At the same time, when we look at the shareholder base, we actually see from an institutional investor's perspective, there's actually a very big overlap of the biggest shareholders between us and Meituan, which means that there will be a lot of institutional investors who want to get the Meituan shares. At the same time, as we look at investment like Meituan, we actually made a very big financial gain from it already. That's why we would like to allow our shareholders to start making their own decisions about what to do with the shares. I would say, as I talk about, you know, there's a lot of overlap in terms of the biggest institutional investors. I also believe that some investors may actually want to sell the shares. A lot of the investors would be probably like me, right? You know, who will be holding onto the majority of the Meituan shares for a very long period of time because I'm actually very excited about the prospect of the company. Thank you, Gary. Our next question comes from Robin Zhu of Bernstein. Hi. Thank you. Thanks management for taking my question. I guess a couple of things. Just one, if we take a step back on, you know, returning cash to shareholders, beyond these kind of periodic big distributions, how should we think about the sort of run rate of cash returns? You raised the run rates of buybacks a couple of weeks before the blackout for these results. Is that. Should we think of that as kind of the new sustainable level? And would management ever consider announcing a formal cash payout policy, you know, percent of free cash flow or anything like that? So that's one. And then two, obviously there's been a lot of progress made on cutting costs and scaling back different bits of the business. Be curious to hear how you think about when to go on the front foot again to start spending more money on driving more growth, and how we switch from where we are now to that. Thank you. In terms of capital allocation, I would say, you know, we're not a utility, right? You know, we are a growth-driven company. I would say we're not gonna have a return or dividend yield driven thinking in our capital allocation. If you look at the three sources of capital return that we talk about, one is dividend, the other one is share buyback, and then we talk about the distribution in kind. Each one of them is actually of a different nature, right? You know, I think, you know, in terms of the dividend, it is a program and, you know, we have been distributing about 10% of our non-IFRS earnings, and over time we may actually increase that. It depends on, you know, what, you know, how we look at the reinvestment opportunities. Share buyback is actually, you know, a way for us to return the excess cash flow, and that will be calibrated against investment opportunities, investing in other people, other companies' shares. It is true that given the industry environment right now, we are being more selective in terms of our investments, so that's why we actually have more cash to conduct share buyback, and especially when our shares is actually very attractively valued, given our strong operating cash flow generation, as well as we actually have a basket of investment portfolio, which is also, a share buyback actually get us more exposure to that. That's why this year we have actually stepped up our share buyback in a pretty significant way, but we actually manage it in a dynamic way. In terms of the distribution in kind, that's actually a more case-by-case basis, and that the reasons and considerations I think James have already talked very clearly about. Those are all of different natures. Overall, we do not want to have a target yield, but at the same time, I think, you know, we're very thoughtful and we are very proactive in terms of returning capital to the shareholders as we see fit in order to maximize the shareholder return. Now, in terms of the investment, right? I would refer you to page 4 of our strategy section. I think, you know, we actually talk about the fact that we have a very strong cash flow generation capability as well as a very large holding of liquid assets, and all of them would be more than enough to fund our organic growth, strategic growth, as well as our capital return to the shareholders. We have more resources than we need to do all these things at the same time, and they don't actually conflict with each other. Thank you. Thank you. Our next question comes from Natalie Wu of Haitong International. Hi. Good evening. Thanks for taking my question. I have two as well. The first one is regarding the, regulation. Seems that there are some easing signs from, regulatory environment in China these days. Just wondering, any updates on recent regulation developments that can be sensed from company side, and how should that affect your fundamentals next year? Second one is regarding the, your enterprise services. Just wondering how should we think of the monetization potential for your enterprise app family, including Tencent Meeting, Enterprise WeChat, et cetera. Will it be material contribution in, well, three, one to three years? Thank you. On the regulation side, in the last earnings call, we actually updated you that the recent regulatory direction is actually trending toward supporting healthy development of the industry to complete the rectification and also to carry out normalized regulation. Based on the recent government communications, I think it basically confirms this direction continues. More noticeably, we noticed, for example, in the Party Congress report, it mentioned that China will accelerate the development of the digital economy and further integrate it with the real economy as a measure to drive high-quality growth. Also after that, in a late October NDRC report, recognizes the achievement of the digital economy in the past decade, and the report also advocates a digital economy of greater strength, quality, and scale by developing digital technology and integrating that with real economy. All in all, the direction, I think, you know, we feel is still very consistent with what we said last time. I think what's changed is that in particular, there are some steps and some regulatory approvals that signals a more normalized regulatory environment that confirms this regulatory direction. This includes in the fintech area, we have received approval for investment in Samsung Property & Casualty Insurance Company (China), Ltd. In the online gaming area, we have received approval for new ban hao and also a ban hao amendment in September, and we do expect to receive more ban haos in the coming future. In the area of investments and also antitrust, we received SAMR's approval for a JV with China Unicom. All these specific actions and approvals actually signifies that I think the overall regulatory environment is actually trending towards a more supportive environment. Natalie, on your question about whether our enterprise services would bring material revenue contribution in one to three years, you know, the future's uncertain, but I think it's unlikely we would see a material revenue contribution relative to our total revenue within one year. Over the longer term, we believe these services, you know, will lend themselves to good monetization. If you look at, you know, the experience of Zoom and Slack and Teams and so forth, I think they speak to that longer term opportunity. You know, how quickly we get from the near-term situation where we're focused primarily on distribution to the longer-term opportunity around monetization is partly a function of the competitive landscape. You know, that's the situation that we're in today. As Martin mentioned, we do have a paid subscription product bundling Tencent Meeting, WeCom, and Tencent Docs together, and that's seeing some good early adoption by larger enterprises. But we view this as, you know, something with a longer gestation cycle versus our Video Accounts and international game initiatives that are, you know, turning into material revenue more immediately. Thank you. Thank you. Our next question comes from John Choi of Daiwa. Okay. Thank you very much for taking my question. I have a question about, I think last quarter you guys said that your business is a lot more cyclical, you know, than before, given that the nature of our core businesses are now more, you know, highly correlated with the economy. As we're seeing, you know, some improvements, you know, signals in the macro and also the COVID situation along with, you know, external factors improving, are we seeing better visibility in certain areas like advertising, you know, and fintech and business services, you know, as we go into later this year, early this year, early next year? Does that mean we should see a, you know, better tailwind, as we, you know, see for these cyclical businesses? A quick follow-up about your business services. Appreciate that you guys are doing a lot more on the. As you can see this quarter, we've seen gross profit increase both sequentially and also on an annual basis. How should we think about the margins more on the mid to long term, if you compare to ourselves versus our global peers? Thank you. I think in terms of the macro, third quarter was actually quite good because there is a recovery from the second quarter in which there were a lot of lockdowns. Then I think the beginning of the fourth quarter was a little bit clouded again due to more sporadic lockdowns around the country. I think the short term will probably be still quite volatile. I think overall, right, you know, we do believe, you know, in the medium term, the economy will definitely start to improve, and as a result, we're confident about the medium term. For now, I think, you know, it's gonna be a little bit volatile in this period of time. I think on the business services question that the situation in China from a margin perspective is so dissimilar to the situation in the rest of the world that it's hard to draw analogies. You know, generally speaking, in the rest of the world, the companies that provide infrastructure as a service, such as Amazon and Google don't have very substantial software as a service businesses. Then there's companies like Oracle that you know provide software as a service with less infrastructure. You know, of course, Microsoft does bridge the gap. You know, for comparison in China, there's you know several big companies that do infrastructure platform and software as a service together, including ourselves. That's one difference. Another difference is the competitive behavior is dissimilar. You know, I think in the Western world when web services were growing very quickly, margins were expanding. You know, now as the web services revenue growth slows, there's some pressure on margins as the companies fight more intensely for market share. In China, it's you know, the other way around. When the industry was growing very quickly, margins were very weak, in some cases declining, because everyone was jumping in to try and grab their slice of the pie and maximize their slice of the pie. Versus now with the more difficult environment the industry's been in for the last year, you actually see, you know, in some cases, including our own, that weaker revenue is accompanied by stronger margins as, you know, we refocus on the most sustainable and highest quality businesses within the business services mix. Thank you. Thank you. Our next question comes from Ronald Keung of Goldman Sachs. Thank you. Thank you, Pony, Martin, James, and John. First, want to ask about fintech 'cause we read about this. You noted the double-digit growth in commercial payments. As our business continues to have profits driven from kinda games to ads to fintech now, how is our progress in the financial holdco restructuring? And is that on track? And what are our latest strategies in kinda across these commercial payment, wealth management, and lending businesses in this macro environment and particularly given the change in COVID measures this year? Thank you. And next year. Thank you. In terms of the financial holding company, we do believe that we would want to embrace having a financial holding company license, and we're in the process of understanding the requirements, interacting very closely with the regulators and also make the requisite preparation for it. Because we do see that the regulatory oversight and potential opportunities of having a financial holding company license is beneficial, and the internal organization changes that need to happen will not really cause material impact to the business. We are working proactively on that. But at this point in time, we don't really have an update for you yet. When we have an update, we'll let you know. In terms of the payment business as well as the financial services business, I would say it's actually very important for us to focus on a few things, right? You know, number one is really compliance, and we have spent a lot of time in making sure that all the services are actually complying with the new regulatory requirement and regime. You know, all along the way, we have actually spent a lot of time in working on compliance. But the requirements have been going up as required by regulators, and we have been spending a lot of resources and effort to upgrade our compliance. Especially this is a big challenge given the scale of the service that we have. I think, you know, we have really been able to achieve that. Second is really about risk management because given a challenging regulatory and macro environment, it's actually very important for us to manage risks in a very proactive way. Thirdly is actually leveraging our payment services which connects with a lot of offline merchants and especially small and medium merchants so that we can actually help them to cope with the challenges on the macro side and help them to generate more business. We also have rebate programs so that would actually help them with these difficult periods. We actually felt that, you know, once we go through this period of sporadic lockdowns and from time to time there's actually challenges on the offline side, we should actually return to a pretty good backdrop of organic growth. The payment would actually help to generate business for our lending business as well as for our wealth management business. I think over the longer mid to long term, you know, it's actually with good potential. Right now I think, you know, it's actually very important for us to work through this relatively challenging period. Got it. Thank you, Martin. Maybe a follow-up question on our returning capital to shareholders. After JD and Meituan, I think most of our positions investments are now either not Hong Kong listed stocks or maybe relatively smaller in size. I think how should we think about the future strategies for the investment portfolio? Particularly how do we balance the recycle of capital for ourselves in reinvesting into areas of growth? You mentioned about software companies or international games versus kind of distributing to shareholders. How do we balance these two? I think as Martin spoke to in his introductory comments, you know, we don't necessarily need to do it because we do generate $15 billion of free cash flow a year. If the $15 billion of free cash flow has been fully sufficient, you know, not only to fund our investments in our own infrastructure, and you know, our own new products, as well as investments in, you know, other companies that are complementary to us, such as Ubisoft and FromSoftware, but also to fund a very heavy volume of buybacks on top. The distributions in kind, you know, a separate incremental return of capital to shareholders that will be more periodic in nature rather than continual. Thank you. Thank you, James. Thank you. Our next question comes from Charlene Liu of HSBC. I have two question. The first one is regarding our cloud business. Tencent Cloud business recently set up a JV with China Unicom. Can management discuss the rationale for this collaboration? How it can benefit the company's cloud business? And also should we expect increasing collaboration with SOEs of sort going forward? That's the first question. For the second question, I would like to sort of point out that, you know, in the past couple of months, Tencent has stepped up share buyback to offset the selldown pressure from Prosus. We also, you know, observed that the share price has responded quite favorably to reports instead of potentially taking over the Prosus stake even though it was subsequently being denied. Can we seek your thoughts on what you would consider a favorable outcome for Tencent, in this sort of sell-down Prosus? Could you shed light on sort of do you have a preferred type of strategic, you know, shareholder, et cetera? Thank you very much. Yeah. For the JV with China Unicom, it's actually a focus on distributing CDN and multi-edge computing products that's co-developed by Tencent and Unicom. It's a joint force in order to leverage our development capability, resources, as well as customer base in order to promote these products. We believe the business would have good prospect going forward. But right now the business plan is still being drawn up and the short-term financial benefits will be limited. In terms of the significance, I would say that the approval from SAMR is actually more of a significant event for us on this particular JV. In terms of finding collaboration partners, right? You know, we actually work on it on a case-by-case basis, looking at the business case as well as what are the resources that each party can actually bring to the table. I think there's no specific trend towards whether it's a private company or SOEs or any sector, right? You know, we look at these opportunities on a case-by-case basis. On your question around, you know, whether we've stepped up share buybacks to offset the sell down from Prosus and, you know, what a favorable outcome to all of this would be, it is factually correct that during the last trading window, our buyback volume was similar to slightly greater than the Prosus sell down volume during the same trading days. But I want to emphasize that, you know, we've been a listed company for a long time, and we've very frequently bought back shares when the share price has declined sharply in our history as a listed company, irrespective of whether, you know, Naspers or anyone else was, you know, selling shares or not selling shares at the time. The buyback decision is, you know, primarily around where we see value, and much more so than around flow issues. To put it another way, in the very short term, if a shareholder sells X amount of shares and we buy back Y amount of shares, then, you know, of course that superficially net neutral from a flow perspective, but from a value perspective, which is what we care about, it's value accretive because the shareholder who's selling shares is not actually increasing the share count versus when we buy back shares, we do cancel the shares we buy back, therefore decrease the share counts. There's, you know, value accretion for our remaining shareholders over time. I think that in terms of favorable outcomes, you know, that's a decision for Prosus. You know, Prosus you know has stated that it views this as a you know exercise that's necessitated by the abnormally large discount NAV at which Prosus was trading when it announced this exercise. You know that discount NAV has narrowed somewhat, and you know Prosus has said that should the discount to NAV narrow to certain levels, then you know there could be changes to this policy. Anyway, it's something that you know we're obviously very aware of, but it's not a primary consideration for us you know when we're looking at our capital return policy, including our buyback activity. Thank you. Understood. Thank you. Thank you, Charlene. We should take the last question from Alex Yao of JP Morgan. Good evening, and thank you management for taking my question. Two questions from my side. First one is on the domestic gaming monetization this quarter. The domestic gaming revenue declined by 2% on quarter-over-quarter basis against a positive seasonality and new game launch. What caused such an abnormal seasonality in this quarter? Second one is on the interplay between monetization of Video Accounts and the content ecosystem of the Video Accounts. Have you guys observed the monetization of Video Accounts help the content ecosystem of the Video Accounts at all? I understand this is still early stage of the monetization, but intuitively, I think improving monetization capability of the ecosystem should introduce more financial incentive to the content creators. Therefore, it should be positive to the content ecosystem. Thank you. Alex Yao, on your first question, I may not have understood it exactly, but the short answer is there's a different seasonality for our game cash flows versus our game reported revenue. However, in previous years, when the overall industry and we within it were growing quickly, that seasonality was not apparent as it is this year when, you know, the industry's been in stagnation. To get more granular and specific, you know, the game industry in China typically sees a peak in terms of cash flow generation, grossing receipts during the Chinese New Year period. We then amortize those cash flow receipts into our P&L over a period of several months. The cash flow, the receipts, strength in the Chinese New Year translates into reported revenue strength in Q1 to an extent, but more in Q2 and then also in Q3 before decaying toward the end of the year. Again, in previous years, that seasonality hasn't been as obvious as it is this year. You know, that's basically the short answer to your question, that when you look at the sequential trend for game revenue from Q2 to Q3, it is somewhat influenced by the fact that in Q2, we capture more of the Chinese New Year peak spend in our reported revenue, and then as we go through the back half of the year, that you know fades away due to the approval cycle. In terms of the content ecosystem and monetization, I would say at this stage the monetization does not really have a lot of impact on the content ecosystem. Having said that, content ecosystem has become richer and richer and has been consistently built up for Video Accounts, primarily because of the fact that the traffic has been increasing and our targeting technology has been improving so that we can actually allocate the traffic more specifically to the different content providers. The content providers, once they start to accumulate users and once they start having traffic, right, you know, they can actually monetize one way or the other on their own. Our in-feed ads is actually independent from that. Over the long term, I think there's gonna be more interaction between the two, because once we start having live streaming e-commerce, then basically a lot of the content providers would actually also have live streaming. When they start doing e-commerce and when there are a lot of merchants looking for content developers who also want to do live streaming, they wanna look for streamers, then they would start advertising within our Video Accounts, and that would bring traffic to the live streamers. As a result, they can actually generate more revenue. I think, you know, over the longer term, monetization and the content ecosystem would actually have a stronger interaction and more conducive relationship. Thank you, everyone. We are now ending the webinar. Thank you all for joining our results webinar today. If you wish to check out our press release and other financial information, please visit the IR section of our company website at www.tencent.com. The replay of this webinar will also be available soon. Thank you, and see you next quarter.