Good day, and welcome to Bilibili fourth quarter and fiscal year 2022 financial results and business update conference call. Today's conference is being recorded. At this time, I'd like to turn the conference over to Juliet Yang, Executive Director of Investor Relations. Please go ahead. Thank you, operator. During this call, we'll discuss our business outlook and make forward-looking statements. These comments are based on our predictions and expectations as of today. Actual events or results could differ materially from those mentioned in today's news release and in this discussion due to a number of risks and uncertainties, including those mentioned in our most recent filing with the SEC and Hong Kong Stock Exchange. The non-GAAP financial measures we provide are for comparison purpose only. Definition of these measures and a reconciliation table are available in the news release we issued earlier today. As a reminder, this conference call is being recorded. In addition, an investor presentation and a webcast replay of this conference call will be available on the Bilibili web, IR website at ir.bilibili.com. Joining us today from Bilibili senior management are Mr. Rui Chen, Chairman of the Board and Chief Executive Officer, Ms. Carly Li, Vice Chairwoman of the Board and Chief Operating Officer, and Mr. Sam Fan, Chief Financial Officer. I'll now turn the call over to Mr. Fan, who will read the prepared remarks on behalf of Mr. Chen. Thank you, Juliet. Thank you everyone for participating in our 2022 fourth quarter and fiscal year financial and operating results conference call. I'm pleased to deliver today's opening remarks on behalf of Mr. Chen. In 2022, we proactively adjusted our strategies and reprioritized our goal to better align ourselves with the new industry paradigm. Specifically, we place our focus on DAU growth and how to reach profitability. Beginning to our progress on these two fronts. First, our users and their engagement with our community remain the foundation of our business. By focusing on DAU growth, we are bringing higher quality users to our platform, which ties in more closely to our monetization potential. In Q4, our DAUs increased to 93 million, up 29% year-on-year. This brought our DAU to MAU ratio to 28%, a meaningful improvement from 26% in the same period last year. The average daily time spent per user on our platform reached 96 minutes, driving the total time spent on our platform up by 51% year-on-year. We will continue to cultivate our DAUs with optimized product offerings and algorithms, and further support our commercial prospects with controlled sales and marketing spending. Second, we improved our commercialization efficiency and elevated our cost reduction measures to bring us closer to our goal of profitability. Our total net revenues for 2022 were RMB 21.9 billion, and the total net revenues for Q4 were RMB 6.1 billion, up 6% year-on-year. Our gross margin improved to 20% in Q4, compared with 18% in the previous quarter. We continue to take measures to control our expenses and improve our organization efficiency. Specifically, in the first quarter, we cut sales marketing expenses by 28% year-on-year. Sales and marketing expenses as a percentage of total net revenues reduced from 30% in the same period last year to 21% in the fourth quarter. We have also streamlined our personnel and trimmed our non-core and underperforming business. As a result, our non-GAAP net loss in the first quarter narrowed by 21% year-on-year and 26% quarter-on-quarter. As we move through 2023, our operational goal is to become more efficient company. We will centralize our resources to focus on less but more important tasks. Specifically, we plan to continue grow our DAUs, improving our gross margin and tightening our expenses. As we are executing on these actions, we believe we are on the right track to achieve our break-even target by 2024. With that overview of our strategic approach and progress, I'd now like to provide a brief update on our three core pillars of content, community, and commercialization. Starting with content. Our ever-growing content ecosystem is our most valuable asset. In the fourth quarter, our platform hosts 3.8 million content creators, 25% more than the same period a year ago. Creators submit 17.6 million videos, up 62% year-on-year, both on monthly basis. To encourage more users to turn their ideas into creations, we will provide them with more easy-to-use tools to get would-be creators started. At the same time, more traffic will be led toward mid and long-tail creators. Our goal is to turn more users into creators, driving both our content offerings and user engagement. Expanded content scenarios are also attracting more traffic to Bilibili. For the fourth quarter, total daily video views were up 77% year-on-year to 3.9 billion. In particular, Story Mode daily video views increased by 175% year-on-year, while PUGV video views increased by 56% in the first quarter. Story Mode has allowed us to expand into the vertical video market, bolstering our DAUs, increasing user time spent on our platform, and opening more commercial opportunities for us to pursue. To unlock our commercial potential, in 2022, we further integrated our commercial channels within our content ecosystem. The combination has created more immersive advertising opportunities and various monetization channels for content creators. Over 1.3 million content creators earned income through multiple channels on Bilibili in Q4, up 64% year-over-year. Looking at our community, our inclusive community environment and rich interaction tools are creating tighter bonds between our users and our platform. In the fourth quarter, users' average daily time spent on Bilibili reached 96 minutes. Monthly injections also increased by 35% year-on-year to 13.6 billion. As for the core members of our community, the number of official members reached 195 million in the fourth quarter, up 34% year-on-year, and their 12-month retention rate continued to exceed 80%. Now, let's review our commercialization progress and how we think about it moving forward. For the fourth quarter, our total net revenues reached RMB 6.1 billion, up 6% year-over-year. Our full year revenue grew by 13% to RMB 21.9 billion. We are now more focused on improving our commercialization efficiency and specifically on improving our gross margin at a company level. I'd like to share more color on each of our commercial business lines. First, our VAS business. Revenues from VAS was RMB 2.3 billion for the fourth quarter and RMB 8.7 billion for the year, up 24% and 26% year-on-year respectively. Live broadcasting, in particular, has shown solid growth. For 2022, revenues from live broadcasting increased by over 30%. Our strategy to integrate live broadcasting within our video ecosystem has prompted more creators to tap into live broadcasting universe. This has helped to penetrate more video users, converting paying users, and optimize our revenue sharing structure organically. In the fourth quarter, the number of monthly active live broadcasting hosts increased by over 70%, and MPUs for live broadcasting grew by over 40%, both on year-on-year basis. Looking ahead, live broadcasting will continue to be one of our primary revenue growth drivers. We expect to optimize our revenue sharing ratio and to further improve live broadcasting gross margin. By the end of the fourth quarter, we had added nearly 1 million premium members from the prior period, reaching a total of 21.4 million premium memberships. We launched multiple Chinese anime titles during the period, including the highly anticipated sci-fi thriller, The Three-Body Problem. In January 2023, our co-produced traditional Chinese style graphic anime, Yao Chinese Folktales: Zhongguo Qitan, become a smash hit, generating over 200 million video views on our platform. As for our advertising arm, we continued to gain market share in 2022. Advertising revenues were up by 12%, reaching RMB 5.1 billion in 2022, and RMB 1.5 billion in Q4. Our top performing verticals in the first quarter were mobile games, e-commerce, digital products, and home appliance, automotive, and skincare and cosmetics. In 2022, we further opened up our ecosystem to embrace more advertising opportunities across various videos viewing scenarios. The new ad scenarios we introduced in Story Mode and improved sales conversion modules has proven a success in performance-based ads and carry higher ROIs. In the fourth quarter, our performance-based ads revenue grew by over 50% year-on-year. In addition, as our users getting mature and into new life stages, their new consumption needs, such as automotive and home appliance, also attract more advertisers, and their ad budgets have been allocated to our platform. Moving into 2023, we are continuing to invest in and improve our ad infrastructure, and further integrate our ad capabilities within our content ecosystems. Turning into games. Revenues for the year were RMB 5 billion, and RMB 1.1 billion for the fourth quarter. We are committed to the strategy of development in-house distributed globally. In Q4, we restructured our game development to effectively align with this goal. Specifically, we eliminate underperforming self-developed projects and centralize our resources to focus on genres where we are already experts. In 2022, our self-development games contributed 5% of our total game revenues. We expect this ratio will continue to expand in 2023 as we roll out more self-development games. Looking at our pipeline, we are planning to launch two self-development games, THRUD and Yiluxi'er, as well as six exclusively licensed titles in the second quarter of this year. As game license approvals have gradually resumed in China, we expect to engage in more opportunities in the domestic market. In summary, the new industry dynamics call for more efficient operations. In 2023, we will continue to centralize our resources to grow our DAUs, increase our gross margin, and narrow our losses. Throughout this process, we will continue to strengthen our execution and tighten our spending while selectively investing R&D will improve our commercialization efficiency. With these measures in place, we believe we are on the right track to reach our financial goals and become a stronger, more resilient, and efficient organization. This concludes Mr. Chen's remarks. I will now provide a brief overview of our financial results for the fourth quarter of 2022 and outlook for the fiscal year of 2023. For a review of our fiscal year 2022 results, please see our press release issued earlier today. Total net revenues for the fourth quarter were RMB 6.1 billion, up 6% from same period of 2021. Our total net revenues breakdown by revenue streams were approximately 38% VAS, 25% advertising, 19% mobile games, and 18% from our e-commerce and other business. Cost of revenues increased by 4% year-over-year to RMB 4.9 billion. Our gross profit in the fourth quarter were RMB 1.2 billion, and our gross margin was 20.3%, up 2.1 percentage points sequentially. With our tightly controlled cost structure, we expect to show continued margin improvement throughout 2023. Total operating expenses were RMB 3.6 billion, up 15% from the same period in 2021. As we work on increasing our commercial prospects, we are also keeping a lean cost structure. We cut sales marketing expenses in Q4 by 28% year-on-year to RMB 1.3 billion, while DAU grew by 29% year-over-year. Sales marketing expenses as a percentage of total revenues was also down to 21% compared to 30% in the same period last year. We will continue to control sales marketing expenses while delivering solid DAU growth in 2023. G&A expenses were RMB 870 million, up 52% year-over-year. The increase was primarily due to the one-off severance pay of RMB 252 million related to our organizational restructuring. R&D expenses was RMB 1.5 billion, representing an 87% increase year-over-year, which was primarily due to increased R&D personnel and a one-off cancellation cost of RMB 470 million related to our certain game projects. As we move through 2023, we will take additional actions to reduce our operational expenses. We think our overall operating expenses peaked in 2022 and will start to decline in 2023. Net loss and adjusted net loss was RMB 1.5 billion and RMB 1.3 billion, narrowing by 29% and 21% year-on-year respectively. Our net loss ratio in the fourth quarter was 24%, a very notable improvement from 36% for the same period a year ago. We expect to continue to narrow our losses in 2023. Turning to our capital allocation and liability management. We are keenly aware of our cash reserves and have take steps to improve our balance sheet, which give us the flexibility we need to reach our break-even target by 2024. We are actively managing our liabilities and to improve our balance sheet. In the fourth quarter, we repurchased and retired a total principal amount of $547 million notes for a total cash consideration of $420 million. A part of our liability management plan in January 2023, we completed a $409 million equity offerings and note exchange program. We retired a principal amount of $385 million of convertible notes for a consideration of $331 million cash funded by this offering. The remaining $69 million in proceeds were used to replenish our cash reserve. After this transaction, we currently have three outstanding CBs that totaled $1.6 billion. As of December 31, 2022, we had a cash and cash equivalents, time deposits, and short-term investments of RMB 19.6 billion or $2.8 billion. We believe this amount is sufficient to cover all of our remaining convertible bonds and fund our future operations. While we take further action to narrow our losses and reach non-GAAP breakeven by 2024. With that in mind, we are currently projecting net revenues for the full year of 2023 to be between RMB 24 billion and RMB 26 billion. Thank you for your attention. We would now like to open the call to your questions. Operator, please go ahead. Thank you. We will now begin the question and answer session. To ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. For the benefit of all participants on today's call, if you wish to ask your question to management in Chinese, please immediately repeat your question in English. Please limit your questions to one at a time. If you wish to have follow-up question, please rejoin the queue. Our first question comes from the line of Daniel Chen from JPMorgan. Please ask your question, Daniel. hey, 晚 上 好 ， 管 理 层 ， 谢 谢 给 我 这 个 机 会 问 问 题 。 我 其 实 想 问 一 个 这 个 2023年 这 个 ， 前 景 的 问 题 ， 就 是 现 在 我 们 也 看 到 在 这 个 ， 这 个 中 国 这 个 开 放 以 后 ， 这 个 经 济 回 暖 的 这 个 大 环 境 下 ， 想 了 解 一 下 这 个 公 司 的 核 心 的 ， 策 略 ， 还 有 就 是 我 们 主 要 的 一 个 关 注 点 是 什 么 ？ 谢 谢 。 我 自 己 翻 译 一 下 。 Thanks, management for giving me the opportunity to ask question. My question is on the 2023 outlook. With the macro economy gradually recovering, what's our core business strategy in 2023? What are the key focus point from a management point of view? Thank you. 我 们 可 以 看 到 从 去 年 开 始 ， 整 个 互 联 网 行 业 的 发 展 进 入 了 一 个 新 的 阶 段 ， 就 是 每 家 公 司 都 会 关 注 更 有 质 量 的 增 长 ， 关 注 利 润 和 现 金 流 。 不 只 是 国 内 的 公 司 ， 我 们 看 到 美 国 的 互 联 网 公 司 也 在 做 同 样 的 事 。 Starting from last year, we've noticed that the internet industry has entered into a new era. Every company is more focused on the quality of the growth, the quality of revenue, as well as improving gross margin and focus on cash flow. Not just Chinese internet company, we noticed many U.S. company are doing the same thing. 对 于 我 们 Bilibili 来 说 ， 今 年 我 们 的 关 注 点 会 是 增 收 减 亏 和 追 求 健 康 的 用 户 增 长 。 For us, our key objective for 2023 would be to grow our top line and narrow our losses and focus to achieve higher quality of user growth. 这 会 是 一 个 长 期 的 策 略 ， 它 不 会 因 为 短 期 的 这 个 环 境 变 化 而 变 化 吧 。 那 个 就 是 刚 才 你 问 到 ， 就 是 今 年 经 济 回 暖 的 这 个 环 境 下 ， 我 们 会 不 会 有 什 么 改 变 ？ 我 觉 得 经 济 回 暖 的 环 境 应 该 会 帮 助 我 们 更 好 地 去 执 行 这 个 策 略 。 This will be our long-term strategy. It will not changing because the change of environment. Of course, as you mentioned, the recovery of the overall economy will help us better executing on this strategy. 今 年 我 们 公 司 的 业 务 会 更 聚 焦 。 整 个 公 司 最 重 要 的 事 就 是 two 件 。 第 first 件 的 话 是 增 收 减 亏 。 第 second 件 就 是 DAU 的 健 康 增 长 ， 就 是 我 刚 才 提 到 的 。 Overall, our business will be more focused. There will be two important tasks. One is to increase our top line and narrow our loss. Number two is to increase our DAU. 增 收 应 该 我 特 别 指 的 就 是 毛 利 的 一 个 增 长 ， 然 后 我 们 会 在 今 年 更 关 注 提 升 毛 利 率 ， 降 低 亏 损 。 然 后 我 们 可 以 看 到 我 们 Q4 的 毛 利 率 同 比 、 环 比 都 有 提 升 ， 而 且 的 话 我 们 的 净 亏 损 同 比 是 降 低 百 分 之 二 十 九 。 我 们 预 计 二 零 二 三 年 我 们 的 整 体 亏 损 能 够 更 明 显 地 收 窄 ， 二 零 二 四 年 达 到 盈 亏 平 衡 的 目 标 。 Number one task, increase our top line. When I say increase our top line, I'm referring to the increase of top line as well as our gross profit. We'll be focusing on improving our gross margin and narrowing our losses. In the fourth quarter, we've achieved a gross margin improvement from a year-over-year and quarter-over-quarter basis. We also narrowed our net loss by 29% year-over-year. We expect that in 2023, our overall net loss will narrow more meaningfully and to achieve our breakeven target by 2024. 在 用 户 增 长 方 面, 我 们 在 2023 年 不 会 再 单 纯 地 去 追 求 MAU 的 一 个 数 字, 我 们 会 关 注 更 有 质 量 的 DAU 的 增 长, 以 及 DAU 商 业 价 值 转 换 效 率 的 提 升. On the user aspect, we will no longer just pursue the absolute number of MAU, but rather to focus on the growth of our DAU as well as the sales conversion of each DAU that can bring to the company. 2023 年 我 们 会 提 升 我 们 的 这 个 DAU 比 MAU 的 一 个 比 例 ， 然 后 目 前 是 百 分 之 二 十 八 ， 我 们 应 该 会 提 到 百 分 之 三 十 。 In 2023, we are expecting our DAU to MAU ratio will continue to improve. Currently we're at 28%. We expect to increase to 30% level. 这 个 会 意 味 着 更 高 的 用 户 的 活 跃 度 ， 更 高 的 用 户 粘 性 ， 以 及 更 大 的 用 户 提 供 的 商 业 价 值 。 This will mean better engagement, better stickiness of our company as well as higher commercialization potential. 最 后 的 话 我 还 是 想 强 调 一 下 ， 就 是 B 站 的 立 足 之 本 一 直 是 我 们 的 社 区 和 我 们 的 内 容 生 态. 无 论 我 们 谈 怎 样 的 发 展 策 略 ， 社 区 和 内 容 生 态 都 是 B 站 的 地 基. I still want to emphasize that our community and content ecosystem is the cornerstone of our business. No matter what kind of strategy, the community and the content ecosystem is the foundation of the business. 今 年 是 B 站 成 立 的 第 十 四 年 ， 然 后 我 们 在 过 去 十 多 年 的 时 间 ， 我 们 经 历 了 三 个 大 的 周 期 ， 就 是 PC 互 联 网 的 周 期 ， 移 动 互 联 网 的 周 期 ， 以 及 即 将 到 来 的 AI 时 代 的 一 个 周 期 。 然 后 在 过 去 十 多 年 的 情 况 下 ， 就 是 无 论 这 个 大 的 产 业 环 境 怎 么 变 ， 无 论 就 是 科 技 的 这 个 ， 这 个 平 台 的 发 展 怎 么 变 ， B 站 的 社 区 以 及 PUGV 的 内 容 生 态 一 直 是 我 们 内 容 增 长 的 内 在 的 原 动 力 。 In this year, we'll be celebrating our 14th anniversary. In the past 14 years, we have experienced three industry cycle, which is the PC era, mobile era, and as we're going through the AI-powered e-era. No matter how the technology industry is evolving, for Bilibili, the community and the PUGV content ecosystem aspect is what has kept us going while others come and go. 我 们 相 信 高 质 量 内 容 的 价 值 ， 我 们 也 相 信 优 质 的 创 作 者 所 带 来 的 一 个 价 值 。 所 以 的 话 ， 就 是 我 觉 得 社 区 和 内 容 生 态 一 直 是 我 们 最 有 优 势 的 竞 争 壁 垒 ， 也 是 我 们 不 断 穿 越 周 期 的 基 础 。 We believe the value of high- quality content. We also believe in the value that high, talented content creator can bring. That is the biggest moat for our business. It is also the biggest competitive advantage that we own in this ever-changing landscape. 我 们 有 信 心 B 站 的 内 容 生 态 能 够 持 续 地 产 生 好 的 内 容 。 我 们 也 有 信 心 ， 就 是 在 我 们 的 平 台 上 能 够 持 续 地 产 生 最 有 吸 引 力 的 、 最 有 才 华 的 UP主 。 所 以 的 话 ， 就 是 我 觉 得 这 个 才 是 B 站 的 核 心 价 值 ， 然 后 我 们 会 持 续 地 把 这 个 价 值 放 大 ， 然 后 来 做 到 持 续 的 健 康 的 用 户 增 长 。 We believe in that our unique content ecosystem can continuously generate high-quality content and talented content creator. The value of this content that bring to Bilibili is our core competitiveness. We'll continue to cultivate that and continue to build on that and bring high-quality growth to our company. Operator, next question, please. Thank you. Next question comes from the line of Xueqing Zhang from CICC. Please ask your question, Xueqing. 哎 ， 晚 上 好 ， 谢 谢 管 理 层 这 次 提 问 的 机 会 。 那 我 想 请 教 一 下 关 于 财 务 展 望 的 问 题 。 那 上 一 个 问 题 ， 锐 总 也 有 提 到 ， 公 司 过 去 几 个 季 度 毛 利 率 是 有 在 持 续 提 升 的 ， 那 我 们 如 何 展 望 今 年 毛 利 率 的 一 个 具 体 的 趋 势 ？ 然 后 对 应 也 想 了 解 一 下 ， 因 为 我 们 给 了 全 年 的 收 入 端 指 引 嘛 ， 那 能 不 能 帮 我 们 对 应 的 业 务 线 简 单 拆 一 下 。 啊 最 后 的 话 ， 如 果 我 们 看 到 利 润 端 的 话 ， 怎 么 看 待 全 年 减 亏 的 一 个 具 体 的 趋 势 ？ 啊 ， 谢 谢 。Uh, thanks management for, uh, uh, for taking my question and my question regards to financial outlook. As Rui Chen mentioned before, we see the company's gross margin has continued to increase in the past few quarters. How does management think about the trend of margin in 2023? Since we give the full year revenue guidance, what the growth of each segment does it imply? Lastly, on the bottom line, what's the outlook for the net loss narrowing in detail? Thank you. Yeah, this is Sam. I will take your question. As Mr. Chen mentioned, the key objective of the company for this year to improve our gross margin and narrow our loss. That's why for 2023 revenue guidance, we are cutting down low margin business, such as esports content, supplies revenue business and certain low margin e-commerce business. As a result, we expect our e-commerce and other revenue line for 2023 to decline by mid 20%-30%. However, we expect the gross margin and the gross profit for e-commerce and other business to improve year-over-year. For the non-e-commerce business, our revenue, including our game, VAS, and advertising, if we combine these together, we still expect to grow by 20%+ year-over-year in 2023. Regarding to the gross profit, overall, the increase of the revenue will drive the increase of the gross margin, especially for certain fixed costs such as server and bandwidth, staff costs, and content costs. In 2023, as mentioned, we'll be more selective and ROI focus in terms of the content investment. We also expect the percentage of the server and the bandwidth cost and staff cost will decline. In terms of the revenue sharing cost, we expect each business line's gross margin will improve year-over-year. As high margin business gradually increase their contribution, there will be more meaningful improvement on revenue sharing cost. For OpEx, total OpEx have peaked in 2022. We expect OpEx will start to decline in 2023. We cut sales marketing expenses by 15% in 2022. We expect further cost cuts down for sales marketing in 2023. Meanwhile, G&A and R&D expenses in terms of the absolute dollar amount will also decline slightly in 2023. We expect our gross margin to gradually improve to mid-twenties throughout the 2023, and we also expect meaningfully narrow our non-GAAP operating loss in 2023. Thank you. Operator, next question, please. Thank you. The next question comes from the line of Yiwen Zhang from China Renaissance. Please ask your question, Yiwen. My question is on the advertisement. Can you discuss about the outlook of ads market in 2023 and what kind of trend have we seen? Secondly, on the product side, can you give us the latest update on the Story Mode and what kind of development should we expect on our ads business on the product side? Thank you. Firstly, on the Story Mode, our multi-screen and multi-scenario is one of our key strategies that's driving Bilibili's user growth. The 28% DAU to MAU ratio and 96 minutes daily user time spent means the strategy is working effectively. Story Mode as a newly added scenario is an important supplement to our existing PUGV, OGV live broadcasting and big screen OTT scenario. We noticed that since the launch of Story Mode, it has played a vital role in terms of increasing user engagement, especially for user who are not as active. It has also helped us to attract new content creators across the video industry. At the same time, it has driven better than expected increase in terms of video views as well as user time spent. Story Mode has essentially allowed user to access their favorite Bilibili content anytime, anywhere. Bilibili has always put high quality content and content creator at top priority. Since inception, PUGV ecosystem has maintained a very healthy growth. When we are mentioning the Story Mode grow, at a fast pace, don't forget that PUGV also grew by 50% year-on-year and maintained a very healthy growth rate. 任 何 的 一 个 ， 无 论 是 创 作 者 还 是 内 容 的 消 费 者 ， 其 实 我 们 都 观 察 到 他 们 对 内 容 的 审 美 以 及 需 求 肯 定 是 越 来 越 高 的 。 我 们 比 较 坚 信 Story 这 个 容 器 会 为 PUGV 的 生 态 提 供 源 源 不 断 新 的 创 作 者 以 及 创 作 力 。 与 此 同 时 ， Story 带 来 的 新 的 流 量 以 及 我 们 已 有 生 态 的 结 合 之 后 ， 会 比 较 大 地 提 高 我 们 的 广 告 效 率 ， 也 会 提 供 了 直 播 跟 广 告 更 多 的 新 的 商 业 机 会 。 Whether it's content creator or content consumer, their need for high quality content will evolve, so will their sense of style. We think that Story Mode has served a very good vessel to carry PUGV content to support our ever growing ecosystem. In addition, the combination of Story Mode traffic and our existing ecosystem has helped us to increase our ad efficiency, and this has also brought new commercial opportunity for live broadcasting and advertising. 对，同时可以 说一下 广告。2022 年 的 话，大家 众所周知 就是 广告 的 市场 并不 很好，而 在 增速 我们 看到 的 是 小 个 位 数 的 增长。在 充满 挑战 的 这 一 年 份，其实 B 站 的 市场 的 占有率 还是 有 持续 的 提升 的，我们 全年 的 收入 超过 了 RMB 5 billion。 As you may already aware, it has been a very challenging market for advertising in 2022. The overall ad market only had low single digit growth. Under this challenging market, we are continuing to gain market share. For Bilibili's full year advertising revenue, we have reached RMB 5 billion. 2023 年 大 家 也 慢 慢 发 现 ， 广 告 主 还 开 始 恢 复 信 心 ， 就 预 计 整 个 行 业 整 体 还 是 会 有 有 机 会 达 到 两 位 数 的 一 个 增 速 ， 但 是 广 告 主 还 是 会 比 以 往 更 谨 慎 ， 也 更 关 注 投 放 的 ， 就 投 放 这 个 广 告 的 核 心 价 值 是 什 么 ， 也 会 更 关 注 广 告 的 整 体 的 有 效 性 。 As for 2023, there has been a recovery of confidence for advertisers. Maybe overall industry can achieve a double-digit growth. We will see that. However, we also noticed that, for all advertisers, they will be more cautious and they will be focusing more on the core value of their ads investment, and their ads investments efficiency. 那 这个 时候 我们 就会 看 一下 ， 广告主 究竟 每年 投入 预算 的 时候 ， 核心 要 解决 的 问题 是 什么 。 其实 我们 总结 有 几大 类型 吧 ， 就 一个 呢 就是 发 新品 。 第二 个 事情 呢 ， 就是 品牌 怕 老去 ， 必须 做 持续 的 渗透 。 第三 个 呢 ， 就是 一定 要 持续 着 去 影响 用户 的 心智 ， 以及 达到 转化 消费 的 效果 。 那么 回看 一下 ， 其实 B 站 的 整个 生态 跟 产品 形态 已经 覆盖 了 以上 的 关键 需求 ， 所以 我们 还是 比较 有 信心 在 广告 业务 体系 上 ， 今年 是 高于 整个 行业 的 增速 的 。 The key reason for advertiser to invest in ads, we have categorized for three main area. One is new product launch. Two is brand rejuvenation. Three is in continuously to increase their brand perception and drive sales conversion. The advantage for Bilibili advertising is that we can cover all above three core needs. We are confident our ads growth rate will beat the industry growth rate. 在 2023 年 ， 我 们 对 行 业 的 整 个 售 卖 形 式 跟 模 式 会 进 行 升 级 ， 而 整 合 营 销 依 旧 还 是 我 们 长 期 的 增 长 的 引 擎 。 呃 ， 首 先 第 一 个 我 们 可 以 看 一 下 ， 在 强 势 的 行 业 里 面 ， 我 们 会 进 行 全 链 路 的 升 级 ， 把 壁 垒 筑 得 更 高 一 些 ， 就 包 括 我 们 熟 悉 的 游 戏 跟 3C 数 码 。 呃 ， 用 游 戏 举 个 例 子 吧 ， 就 是 ， 呃 ， B 站 是 全 网 游 戏 最 大 的 社 区 ， 就 消 费 用 户 其 实 已 经 接 近 了 九 千 万 ， 加 上 最 近 其 实 游 戏 版 号 也 是 发 放 开 始 常 态 化 了 ， 都 是 个 比 较 有 利 的 一 个 条 件 。 那 Q1 呢 ， 我 们 把 游 戏 联 运 、 游 戏 广 告 ， 包 括 游 戏 内 容 三 大 团 队 的 整 合 成 一 个 大 的 目 标 ， 目 ， 目 的 就 是 给 游 戏 厂 商 提 供 更 完 整 的 服 务 。 最 后 提 升 游 戏 内 容 到 游 戏 下 载 的 整 体 的 一 个 分 发 效 率 。 呃 ， 我 们 还 是 希 望 让 每 一 款 游 戏 进 入 B 站 这 个 社 区 之 后 ， 可 以 快 速 地 触 达 用 户 ， 也 可 以 长 线 地 在 B 站 经 营 ， 达 至 ， 就 截 至 它 可 以 在 B 站 上 可 以 深 度 地 转 化 跟 深 度 地 运 营 目 标 。 In 2023, we will be looking to upgrade our sales model for different industry verticals. We believe that integrated marketing will continue to be our long term growth driver. For our leading industry verticals, we'll continue to build high barriers and upgrade full ad product matrix, such as for games, 3C and digital product. Take games for an example. Bilibili has the largest gamer and game content community in China, and with near 90 million unique user consume content, game content on a monthly basis. We think the recent regularization of 版 号 is also a favorable tailwind for us. In Q1, we have unified the OKRs for three key game team, including game distribution, game ads and game content, in order to provide a more comprehensive service to game companies and improve the efficiency for game distribution. Our goal is to enable every game company to reach their target audiences in time, and also achieve long operation cycle and higher conversion rate on Bilibili. 那 第 二 点 ， 其 实 我 们 有 一 些 进 一 步 可 以 扩 大 行 业 就 是 份 额 的 一 些 行 业 ， 包 括 电 商 、 汽 车 跟 大 快 消 ， 而 这 些 都 是 行 业 预 ， 就 行 业 的 大 预 算 的 一 些 领 域 。 用 电 商 也 可 以 举 一 个 例 子 ，B 站 是 行 业 内 唯 一 一 个 坚 持 做 大 开 环 的 视 频 内 容 生 态 社 区 。 就 去 年 我 们 其 实 已 经 跟 阿 里 、 拼 多 多 跟 京 东 ， 除 了 我 们 合 作 品 牌 跟 效 果 的 逻 辑 以 外 ， 也 更 完 善 了 进 行 了 品 宣 、 种 草 、 转 化 交 易 的 一 个 模 型 。2022 年 有 超 过 一 千 多 个 新 的 品 牌 ， 以 及 一 万 多 个 SKU 在 B 站 通 过 带 货 的 方 式 成 功 首 发 ， 那 效 果 转 化 成 广 告 也 实 现 了 比 较 超 预 期 的 收 入 。 所 以 最 近 我 们 也 会 对 视 频 跟 直 播 带 货 整 个 体 系 进 行 整 合 ， 探 索 属 于 B 站 的 开 环 交 易 的 模 式 ， 就 进 一 步 就 把 这 个 模 式 做 得 呃 ， 更 好 一 些 ， 也 将 在 今 年 会 快 速 提 升 电 商 行 业 以 及 商 家 的 预 算 。 Secondly, we expect to further gain market share and attract larger budget from areas like e-commerce, automotive and general FMCGs. Take e-commerce, for example. Hello? Hello, operator. Please carry on. Yeah, we were disconnected for a second. We were saying that Bilibili is the only video community who is open about e-commerce collaboration. Last year, together with Alibaba, Pinduoduo, and JD, we have optimized our brand seeding conversion model on top of our traditional brand and performance ads. In 2022, over 1,000 new brands and over 10,000 SKU have debuted on Bilibili through 带货 function, which also resulted with better than expected performance-based ads revenue. We will continue to integrate video and e-commerce live broadcasting e-commerce system and explore Bilibili's unique open- loop transaction model. We also expect to quickly expand our market share in e-commerce ads and their budget this year. 除 此 外 的 话 ， 包 括 我 们 的 算 法 的 基 建 怎 么 去 提 效 ， 就 AIGC 的 应 用 ， 也 包 括 我 们 数 据 能 力 的 建 设 ， 提 供 给 客 户 更 科 学 的 一 些 营 销 数 据 作 为 他 们 投 放 的 依 据 ， 包 括 我 们 也 经 常 提 到 的 商 业 场 景 的 继 续 的 开 拓 ， 包 括 提 升 我 们 生 态 内 的 商 业 氛 围 ， 这 些 都 是 我 们 从 二 零 二 二 年 坚 持 做 的 正 确 的 事 情 ， 也 将 会 持 续 是 我 们 二 零 二 三 年 的 重 点 。 On top of all that, we're also looking to improve our algorithm infrastructure and invest in AIGC application, and also improve our data capacity to provide our customers with more scientific marketing data point. We'll continue to explore more ad scenarios, enhance ads friendly atmosphere in our community, all of which are the right thing to do, that's what we have done in 2022 and will continue to carry into 2023. Operator, next question please. Thank you. Next question comes from the line of Lei Zhang from Bank of America Merrill Lynch. Please ask your question, Lei. Hi. 管理层晚上好。谢谢接受我的提问。我的问题主要是关于游戏的。想看一下我们 2023 年整体游戏业务的展望，还有自研游戏现在的策略的进展。还有就是版号重启后的话，B站有没有一些新的游戏的机会呢？谢谢。我自已翻译一下。Thanks management for taking my question. My question is mainly about game business. Can you share with us your in-house game strategy and outlook and any new game we can expect after the resume of game licensing? Thank you. 二 零 二 二 年 ， 那 个 整 个 游 戏 行 业 也 是 进 入 了 一 个 新 的 阶 段 ， 然 后... 好 ， 也 是 进 入 了 一 个 新 的 阶 段 。 嗯 ， 其 实 我 们 觉 得 那 个 版 号 只 是 其 中 一 个 原 因 吧 。 我 觉 得 更 大 的 一 个 原 因 呢 ， 就 是 那 个 移 动 用 户 的 红 利 逐 渐 消 退 。 然 后 另 外 呢 ， 就 是 玩 家 对 于 游 戏 品 质 的 要 求 越 来 越 成 熟 ， 然 后 这 个 其 实 对 于 行 业 的 影 响 还 是 很 大 的 ， 呃 ， 因 为 它 直 接 带 来 的 一 个 影 响 呢 ， 就 是 游 戏 开 发 成 本 的 提 升 ， 以 及 新 游 戏 的 成 功 率 的 下 降 。 We believe we have entered a new era for game business last year. 版号 is one of the reason. Another reason was the increasing penetration rate for mobile gamers in China. Gamers involving taste and their increasing demand for higher quality games are also shaping the overall games industry. As production cost rises, the success rate for games is declining. 在 有 用 户 红 利 的 时 候 ， 你 只 要 把 游 戏 内 容 做 好 ， 就 一 定 能 挣 钱 。 当 游 戏 的 行 业 变 成 一 个 存 量 市 场 的 时 候 ， 然 后 能 够 挣 钱 的 游 戏 就 变 得 只 剩 下 2 种 。 第 1 种 呢 ， 就 是 头 部 的 超 级 游 戏 。 然 后 第 2 个 呢 ， 就 是 你 在 垂 类 里 面 成 为 头 部 ， 就 是 只 有 这 2 种 那 个 情 况 下 ， 你 才 能 够 有 持 续 的 利 润 。 In the era of lower gamer penetration rate, it's easy to make money for games company as long as they have good quality of titles. However, we believe in this new era, there will only be two kinds of game can make money and succeed. One is the super mega titles. Number two will be the number one title in a segment genre because it will have a longer life cycle. Only the two kinds of game will be able to gain market share and survive in this new era. 就 是 B 站 的 游 戏 的 发 展 的 一 个 战 略 ， 也 是 为 未 来 的 这 个 行 业 和 这 个 趋 势 做 准 备 的 。 我 们 会 更 坚 定 地 去 执 行 ， 就 是 我 们 提 出 的 战 略 和 精 品 自 研 全 球 发 行 。 我 觉 得 这 个 也 是 在 ， 就 是 游 戏 的 下 一 个 行 业 周 期 我 们 必 须 要 做 的 事 。 全 球 发 行 才 能 够 去 抵 消 ， 更 高 的 游 戏 开 发 成 本 ， 做 到 更 好 的 利 润 。 这 个 ， 就 是 精 品 游 戏 才 能 够 成 为 这 个 ， 能 够 长 线 运 营 的 游 戏 ， 才 能 够 提 供 更 好 的 ROI。 Bilibili's game strategy is designed to serve the market trend in next few years. We will be firmly executing the strategy of developing in-house and distribute globally. This will be the must to do's for the next industry cycles, because only global distribution can cover the increasing production cost, and only the highest quality of games will have long operation cycles, hence to achieve higher ROI. 在 品 类 方 面 的 话 ， 我 们 会 更 聚 焦 ， 无 论 是 我 们 的 代 理 业 务 还 是 我 们 的 自 研 ， 我 们 都 会 聚 焦 在 我 们 擅 长 的 一 个 领 域 ， 就 是 比 如 说 二 次 元 卡 牌 这 样 的 一 个 领 域 。 然 后 在 自 研 方 面 的 话 ， 我 们 也 会 减 少 我 们 的 这 个 自 研 的 一 个 项 目 ， 让 我 们 能 够 把 更 多 的 精 力 投 入 到 成 功 率 最 高 的 一 个 项 目 上 ， 打 磨 精 品 。 In terms of genre, we will be more focused, whether it's a jointly operated game or our self-developed game will be focused on the area that we hold most ad-advantage. The ACG card game will be one of the key game genres we'll be focusing on. We'll be looking to cut down the number of projects, we will be developing and focus our best resources on the limited product. 从 结 果 来 看 ， 就 是 我 们 自 研 游 戏 的 一 个 成 果 还 是 在 慢 慢 地 展 现 出 来 。 去 年 自 研 游 戏 占 我 们 游 戏 业 务 总 收 入 的 比 例 已 经 有 百 分 之 五 ， 这 个 比 例 在 今 年 会 继 续 提 升 。 From a results perspective, the investment we made in self-development games is starting to bear fruit. In 2022 our self-development games revenue is already contributing about 5% of total game revenue. We expect this ratio will continue to increase in 2023. 关 于 版号 的 话 ， 我 们 其 实 可 以 看 到 ， 现 在 国 内 的 版号 基 本 上 是 每 个 月 都 会 发 一 次 ， 而 且 进 口 版号 也 恢 复 发 放 了 。 我 们 认 为 今 年 应 该 是 版号 政 策 应 该 会 常 态 化 。 我 觉 得 这 个 对 于 B站 来 说 ， 无 论 对 于 我 们 的 自 研 游 戏 还 是 对 于 我 们 的 代 理 游 戏 都 是 利 好 。 同 时 的 话 ， 它 对 于 我 们 的 游 戏 联 运 业 务 和 游 戏 广 告 业 务 也 是 利 好 ， 所 以 这 个 肯 定 是 好 消 息 吧 。 As for the 版 号, we believe the releasing of 版 号 has already been normalized. It has been quite regular for domestic 版 号 to be released on a monthly basis. We have also noticed that in the imported titles, there's also been a batch has been approved. We believe that this has been an industry tailwind favorable to Bilibili, not only our self-development games, it will also be favorable for our game jointly operation as well as for our game advertising business. 嗯 ， 在 这 儿 也 可 以 预 告 一 下 ， 就 是 我 们 今 年 二 季 度 就 会 有 两 款 自 研 的 游 戏 上 线 。 We are looking to launch two self-development titles in the second quarter of this year. Please remain on the line. Your conference will resume shortly. Please remain on the line. Your conference will resume shortly. Hello, operator, next question please. Can you hear me? Thank you. Thank you. Our next question comes from Lincoln Kong from Goldman Sachs. Please ask your question, Lincoln. 好，那个谢谢郭毅晨给我一个提问的机会。我想问一下，就是刚才威总也说到了，就是可能接下来我们会有这个AI时代，那今年这个AIGC其实也是有很高的关注度嘛，所以可以不可以给我们讲一下，就是B站在这块AIGC这块以后未来的可能的一些应用，以及带来的产品和商业化这边的一些机会。Thank you for taking my question. My question is about AIGC. Basically, this is a pretty hot theme for this year. Can management elaborate a bit more, you know, how we think Bilibili can apply in the whole AIGC front and the potential on the product and modernization opportunity. Thank you. 我 认 为 AIGC 会 是 就 是 整 个 行 业 甚 至 是 整 个 社 会 都 应 该 关 注 的 一 个 大 的 事 件. 它 意 味 着 什 么 呢? 它 意 味 着 内 容 创 作 生 产 力 的 巨 大 的 提 升. 我 觉 得 这 个 提 升 可 以 类 比 的 一 个 事 件 呢, 是 之 前 那 个 手 机 的 那 个 摄 像 头, 手 机 的 摄 像 头 它 可 以 让 普 通 人 能 够 随 时 随 地 的 去 产 出 内 容. 我 觉 得 那 个 AIGC 它 的 这 个 作 用 呢, 是 能 够 让 产 出 内 容 的 效 率 极 大 地 提 升, 同 时 成 本 很 大 地 降 低, 让 更 多 的 人 能 够 去 创 造 内 容. I believe the opportunity that AIGC can bring is a mega event not only for the industry players, but for the whole society to pay attention. We believe will bring a huge productivity increase in terms of content generation. First, you know, an analogy would be the invention of cell mobile phone camera. It has allow everyone to record video anytime, anywhere. The AIGC can help to increase the productivity of those content and significantly lower the production cost. 我 觉 得 对 于 B 站 来 说 的 话 ， 我 认 为 AIGC 能 够 给 B 站 带 来 很 大 的 一 个 利 处 。 当 然 我 认 为 就 是 这 是 对 于 整 个 行 业 来 说 的 ， 我 认 为 就 是 所 有 的 内 容 平 台 都 能 够 从 那 个 AIGC 当 中 就 是 获 得 利 处 。 因 为 B 站 它 有 两 个 属 性 吧 ， 第 一 个 属 性 呢 ， 它 是 一 个 海 量 的 内 容 平 台 ， 第 二 个 属 性 它 是 一 个 UGC 的 一 个 内 容 平 台 。 就 在 这 两 点 上 面 ， 我 认 为 AIGC 都 能 够 有 很 大 的 这 个 助 力 。 We believe it has brought a very big opportunity for Bilibili as well as for many other players in this industry, but especially so for Bilibili is because for one, we are a massive content platform. Number two, we are a UGC platform. 就 是 我 这 儿 举 个 例 子 吧 。 比 如 说 那 个 就 是 在 搜 索 的 一 个 体 验 上 ， 就 是 我 觉 得 AIGC 它 就 能 够 有 一 个 很 大 的 一 个 ， 就 是 对 B 站 的 搜 索 体 验 会 有 一 个 很 大 的 一 个 增 益 。 其 实 类 似 于 像 ChatGPT 那 样 ， 就 是 它 能 够 承 接 更 复 杂 的 这 个 搜 索 的 一 个 需 求 。 比 如 说 就 B 站 上 面 有 很 多 产 品 的 评 测 视 频 。 我 们 就 可 以 通 过 这 个 AIGC， 我 们 就 可 以 去 问 它 ， 就 是 ， 这 个 在 B 站 上 面 ， 比 如 说 对 于 新 一 代 AirPods 的 这 个 评 测 ， 到 底 有 哪 些 这 个 有 价 值 的 信 息 。 那 么 ， 我 们 就 可 以 直 接 地 把 这 个 视 频 里 面 有 价 值 的 这 些 段 可 以 告 诉 它 ， 无 论 是 视 频 片 段 ， 还 是 把 它 翻 译 成 这 个 文 本 。 First aspect will be on the search front. The ChatGPT similar experience will help user to find the video that they want more efficiently, such as product reviews. Let's say people want to look for a new AirPods review. For Bilibili who has our own data, we can easily accumulate and find and organize and structure the useful information and present to the user in whether it's in a format of video clips or in a format of text, it will largely enhance the user experience when they use the search function. 就 是 大 家 知 道 B站 上 面 有 很 多 ， 就 是 知 识 类 的 ， 以 及 结 构 化 的 这 些 视 频 内 容 。 而 且 很 多 视 频 内 容 它 是 有 很 好 的 历 史 价 值 的 ， 就 是 几 年 以 后 大 家 也 都 会 去 看 它 ， 因 为 它 是 知 识 性 的 。 就 是 我 觉 得 那 个 刚 才 我 提 到 的 这 种 类 似 于 像 ChatGPT 这 样 的 一 个 搜 索 的 一 个 体 验 ， 它 可 以 把 B站 的 这 些 内 容 的 积 累 的 这 个 价 值 能 够 更 充 分 地 发 挥 出 来 ， 也 能 够 让 用 户 更 高 效 率 地 去 消 费 B站 的 这 些 ， 就 是 结 构 化 的 内 容 。 As for Bilibili, because we have a massive amount of knowledge- related content and our Knowledge content in a constructive way, it has more time value. Even after a few years back, we can still find that historical videos that continues to generate views and bring value to users. The ChatGPT like search experience will help us to enlarge the value of our historical video content, at the same time, to improve the consumption efficiency for our users. In terms of content creation tools, we believe the AIGC can bring revolutionary experience that allow more users to start creating content. For example, the same material can be presented in a different format in different in different videos. Also allow many users who used to just be content consumers, now they can easily create content like a professional. I think the third, the benefit it brings should be on the virtual UP master. That is, everyone should know that Bilibili is now China's largest virtual UP master platform. We have several thousand or even tens of thousands of these virtual anchors, virtual images, who are active on Bilibili. AIGC can make these virtual images more automated and should be on the virtual UP master. That is, everyone should know that Bilibili is now China's largest virtual UP master platform. We have several thousand or even tens of thousands of these virtual anchors, virtual images, who are active on Bilibili. AIGC can make these virtual images more automated and should be on the virtual UP master. That is, everyone should know that Bilibili is now China's largest virtual UP master platform. We have several thousand or even tens of thousands of these virtual anchors, virtual images, who are active on Bilibili. AIGC can make these virtual images more automated and should be on the virtual UP master. That is, everyone should know that Bilibili is now China's largest virtual UP master platform. We have several thousand or even tens of thousands of these virtual anchors, virtual images, who are active on Bilibili. AIGC can make these virtual images more automated and more human. I'll give an example. In the past, Luo I'll give an example. In the past, Luo I'll give an example. In the past, Luo Tianyi could only recite lines, but now Luo Tianyi can really communicate with every user, and her conversations are also lifelike. This could only recite lines, but now Luo Tianyi can really communicate with every user, and her conversations are also lifelike. This creates a kind of ambiguity for the virtual image, a huge ambiguity. That is, maybe she can really become a virtual person. I think in this virtual anchor, virtual UP master aspect, AIGC can bring a kind of enhancement, and we are also paying attention to and keeping up with it. Lastly, on virtual content creators, as you may know, Bilibili is already currently the largest virtual content creator platform in China. We have tens of thousands virtual content creator, virtual live broadcast hosts on Bilibili. AIGC can bring more automatic and more efficiency, more higher user experience to the virtual characters. For example, our virtual content host, Luo Tianyi, what AIGC can bring is transform her to a real person. And that will bring revolutionary experience for people who are fan. This is, this has massive imaginary space that what can do with it. We believe AIGC will serve very positive effects in terms of the virtual content creator, virtual live broadcasting hosts, and the virtual idols that Bilibili can offer. Bilibili is essentially a platform, and it connects creators and consumers. Any technology that can improve the productivity of creators or expand the reach of creators is a great benefit to Bilibili. Just like when we moved from PC websites to mobile in the past, it was a change that expanded creators and made it easier for them to produce videos. That change directly increased Bilibili's user base by a factor of 10. I think AIGC is a similar kind of change. If making videos becomes easier, and more people can create videos, then the platform can produce better content, and it becomes more attractive to users. I’m really looking forward to the next era of development that AIGC will bring. As a platform who's connecting content creator with users, the evolution of production tool will serve very positive, bring very positive change to our platform. The change probably will be similar to the PC to mobile era, that's allowing more people to access internet, allow more user to be able to create content easily. That's why our user has increased by tenfolds in the past few years. I'm personally very looking forward to the involvement of AIGC tools in terms of improving the video production efficiency, allowing more people to create content more easily. That will definitely serve Bilibili as a content platform the most. Okay. I think that's the time we have for today. Operator, we can wrap up the call. Thank you. I'll now like to turn the conference back to management for any additional or closing comments. Well, thank you everyone for joining us today. If you have further questions, please feel free to contact our IR team or TPG Investor Relations. Our contact information was presented in the news release earlier, that we issued earlier today. Thank you everyone, and have a great day. Bye-bye. Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.