Good day, and welcome to Youdao Q3 2025 earnings conference call. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Jeffrey Wang, Investor Relations Director of Youdao. Please go ahead. Thank you, Operator. Please note the discussion today will contain information[inaudible] related to the future performance of the company, which are intended to qualify for the safe harbor from liability as established by the U.S. Private Securities Litigation Reform Act. Such statements are not guarantees of the future performance and are subject to certain risks and uncertainties, assumptions, and other factors. Some of these risks are beyond the company's control and could cause actual results to differ materially from those mentioned in today's press release and this discussion. A general discussion of the risk factors that could affect Youdao's business and financial results is included in certain company filings with the U.S. Securities and Exchange Commission. The company does not undertake any obligation to update this forward-looking information except as required by law. During today's call, management will also discuss certain non-GAAP financial measures for comparison purposes only. For the definitions of non-GAAP financial measures and reconciliations of GAAP to non-GAAP financial results, please see the 2025 Q3 financial results release issued earlier today. As a reminder, this conference is being recorded. A webcam replay of this conference call will also be available on Youdao's corporate website at ir.youdao.com. Joining us today on the call from Youdao's senior management are Dr. Feng Zhou, our Chief Executive Officer, Mr. Lei Jin, our President, Mr. Peng Su, our Senior VP, and Mr. Wei Li, our VP of Finance. I will now turn the call over to Dr. Zhou to reveal some of our recent highlights and strategic direction. Thank you, Jeffrey. Thank you all for participating in today's call. Before we begin, I would like to remind everyone that all numbers are in RMB, unless otherwise stated. In Q3, our strategically prioritized businesses, Youdao Ling Shi and online marketing services, delivered strong momentum, supporting our long-term growth trajectory. Net revenues reached RMB 1.6 million, up 3.6% year-over-year. Operating profit was RMB 28.3 million, a decline of 73.7% year-over-year, primarily due to two factors. First, following the significant operating profit improvements in the first half of the year, we increased investments in Youdao Ling Shi and our online marketing services in Q3 to accelerate medium to long-term expansion. Second, we faced a high comparison base from the same period last year due to a one-off impact from the STEAM courses. Our restructuring of the learning services segment is now complete. For the first nine months of the year, operating profit reached RMB 161.1 million, representing a substantial 149.2% year-over-year increase and highlighting the meaningful progress we have made in enhancing our profitability. Notably, we have now achieved operating profits for five consecutive quarters, the first in our history. From a cash flow perspective, operating cash outflow for the quarter was RMB 58.6 million, an improvement of 31.4% year-over-year. Next, I will delve into the major developments across our businesses. Net revenues from the learning services segment were RMB 643.1 million, down 16.2% year-over-year, reflecting our disciplined and strategic approach to customer acquisition as we focus on growing the Ling Shi business. Within the learning services segment, net revenues from digital content services were RMB 425.9 million during the quarter. Our achievements in digital learning have gained international recognition. Youdao was included in the 2026 GSV 150, a list that highlights the world's most transformational growth companies in digital learning and workforce skills, selected from more than 3,000 global companies. Turning to Youdao Ling Shi, one of our key strategic businesses, we made solid progress during the quarter by diversifying its customer acquisition channels. Ling Shi accelerated, achieved over 40% year-over-year growth in gross billings. More recently, retention rate has exceeded 75%, up from over 70% in the fourth quarter of last year. In addition, as part of our broader commitment to cultivate innovative talent, we collaborated with the Yao Mathematical Science Center at Tsinghua University, [Foreign language], providing technical support to a platform designed to identify and support mathematically gifted students. The system is currently being piloted in top-tier schools, with a national rollout planned following further refinements. In terms of our programming courses, we introduced an AI tutor for live programming classes in third quarter, featuring a life-like avatar and supporting both text and voice interactions. The AI tutor helps answer students' questions in real time, significantly enhancing the overall learning experience. With ongoing product upgrades, gross billings for our programming courses increased by more than 30% year-over-year in Q3. Additionally, we continued our deep collaboration with the China Computer Federation, CCF, and are honored to have become a golden partner. On the app side, total sales of our AI-driven subscription services reached a new record of approximately RMB 100 million in third quarter, representing over 40% year-over-year growth. We launched our Confucius 3 translation model, which supports real-time bidirectional translation across 38 languages and offers advanced multi-modal capabilities. Despite its compact parameter size, Confucius 3 translation delivers translation quality that surpasses some larger general-purpose models. In August, our Confucius-3 series LLM was among the first to receive the highest-level trusted AI education large language model certification from the China Academy of Information and Communications Technology. Regarding product development, we introduced a major upgrade to our flagship Youdao Dictionary app, Youdao Dictionary 11, delivering a truly AI-native experience that has been met with widespread user acclaim. A key highlight is the fully redesigned AI simultaneous interpretation feature, powered by industry-leading noise reduction technology and our proprietary turn detection algorithm. It achieves top-tier voice translation accuracy with exceptionally low latency. The feature also received a one-click summarization of translated content and automatically generates mind maps, significantly improving user efficiency across both learning and work scenarios. These enhancements have been well received, driving over 200% year-over-year growth in sales of the AI simultaneous interpretation feature during the third quarter. To date, more than 20 million users have engaged with this capability. We have launched a new AI audio and video translation product, Youdao AnyDub, in the third quarter to automate multilingual production of content such as TV shows, marketing videos, and more. It leverages our proprietary adaptive voice cloning technology to learn a speaker's vocal characteristics and generate a natural, fluent, and emotionally rich dub. The system delivers optimal translation results by holistically considering key factors, including voice, speaker identity, and even video scene transitions, to produce dubbing that is more accurate, contextually aligned, and precisely suited to the creator's intended purpose. Turning to our online marketing services segment, growth accelerated in the third quarter. Net revenues reached RMB 739.7 million, a new record and an increase of 51.1% year-over-year. The strong performance was primarily driven by increased demand from the NetEase Group and overseas markets, which was driven by our continued investments in AI technology. Gross margin for the segment was 25.4% in Q3, moderated roughly 10 percentage points year-over-year, but largely stable sequentially, remaining within our long-term target range of 25%-35%. We continued to rapidly expand our new client base during the quarter to support future growth. Advertising revenues from the gaming industry, mainly contributed from NetEase, grew by over 50% year-over-year. We assisted NetEase Games with a growing number of programmatic advertising and influencer marketing campaigns. For example, in promoting the blockbuster title Where Winds Meet, we executed a comprehensive integrated marketing strategy that generated over 500 million video views and more than 21.4 million live streaming exposures. Looking ahead, we plan to further deepen our collaboration with the NetEase Group and other game clients to unlock additional synergies. Our overseas advertising business also delivered strong momentum, with revenues growing by more than 100% year-over-year. We are pleased that our BYD Wonderlife Global Influencers co-creation campaign received the Brands and Creators Award at the YouTube Works Awards China. Looking ahead, we plan to further deepen our collaboration with Google and with global advertisers to better support Chinese companies in expanding their global presence. We continue to drive improved advertising performance by our AI ad placement optimizer. It is an end-to-end AI-powered agentic solution covering demand analysis, strategy formulation, data analytics, and iterative optimization. In addition, I am thrilled to share that we will launch AI ad placement optimizer version 2 by the end of this year. Please stay tuned. Moving to our smart devices segment, net revenues were RMB 245.8 million during the quarter, down 22.1% year-over-year. This reflects our strategic decision to exercise greater discipline in marketing expenditures, focusing on strengthening the segment's operational health. As a result, we saw year-over-year improvement in the segment's fundamentals during the third quarter. Product-wise, we launched a new tutoring thing, Youdao Space X, which offers precise scanning for long-form and multi-graphic prompts, AI-powered video explanations for academic prompts, and an AI-based mistake ledger. These features empower students to learn and review subjects more effectively and efficiently. Our dictionary pen and tutoring pens were also featured at the World AI Conference, receiving strong exposure to new audiences and coverage from multiple media outlets. Looking ahead, we will continue executing on our AI-native strategy, with a focus on deepening the application of and innovating with our large language model, Confucius, across both our learning and advertising businesses to consistently create value for our customers. Financially, we will maintain disciplined operations and remain confident in achieving the full-year targets set at the beginning of the year, including robust year-over-year operating profit growth and reaching annual operational cash flow break-even for the first time. With that, I will hand over to Su Peng for a deeper dive into our financial results. Thank you. Thank you, Dr. Zhou, and hello everyone. Today, I will be presenting some financial highlights from the Q3 of 2025. We encourage you to read through our press release issued earlier today for further details. For the third quarter, total net revenue was CNY 1.6 billion, or $228.8 million, representing a 3.6% increase from the same period of 2024. Net revenue from our learning services was CNY 643.1 million, or $90.3 million, representing a 16.2% decrease from the same period of 2024. The year-over-year decrease was primarily attributable to our decisions to take a disciplined, strategic approach to customer acquisitions, which placed a greater emphasis on high ROI, return on investment engagements. We believe this strategy has enhanced the overall resilience and operational efficiency of our business, despite the short-term revenue decline. Net revenue from our smart devices was CNY 245.8 million, or $34.5 million, representing a 22.1% decrease from the same period of 2024. Our net revenue from our online marketing services was CNY 739.7 million, or $103.9 million, representing a 51.1% increase from the same period of 2024. The year-over-year increase was primarily driven by the increased demand from the NetEase Group and overseas markets, which was driven by our continued investment in AI technology. For the third quarter, our total gross profit was CNY 687.9 million, or $96.6 million, representing a 12.9% decrease from the same period of 2024. Gross margin for learning services was 58.5% for the Q3 of 2025, compared with 62.1% for the same period of 2024. Gross margin for smart devices was 50.3% for the Q3 of 2025, compared with 42.8% for the same period of 2024. Gross margin for online marketing services was 25.4% for the third quarter of 2025, compared with 36.3% for the same period of 2024. For the Q3, we reduced our total operating expense to CNY 659.6 million, or $92.7 million, compared with CNY 682.2 million for the same period of last year. Looking at our expense in more detail, sales and marketing expense declined to CNY 487.7 million, compared with CNY 519.6 million in the third quarter of 2024. Research and development expense was CNY 127.8 million, compared with CNY 119.6 million in the third quarter of 2024. Our operating income margin was 1.7% in the third quarter of 2025, compared with 6.8% for the same period of last year. For the third quarter of 2025, our net income attributable to ordinary shareholders was CNY 0.1 million, or $0, compared with CNY 86.3 million for the same period of last year. Net income attributable to the ordinary shareholder for the third quarter was CNY 9.2 million, or $1.3 million, compared with CNY 88.7 million for the same period of last year. Basic and dilute net income per ADS attributable to ordinary shareholder for the third quarter of 2025 was $0. Non-GAAP basic and dilute net income per ADS attributable to the ordinary shareholder for the third quarter was CNY 0.08, or $0.01. Our net cash used in the operating activity was CNY 58.6 million, or $8.2 million for the third quarter. Looking at our balance sheet as of September 30th, 2025, our contract liabilities, which mainly consist of the deferred revenue generated from our learning services, were CNY 751.1 million, or $105.5 million, compared with CNY 661 million as of December 31st, 2024. At the end of the period, our cash equivalent, current and on current restrict cash, and short-term investment total CNY 557.7 million, or $78.3 million. This concludes our prepared remarks. Thank you for your attention. We will now go back to open for all of your questions. Operator, please go ahead. Thank you. This is the COROS call conference operator. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the touchstone telephone. Now, from the question queue, please press star and two. Please pick up the receiver when asking questions. Anyone who has a question may press star and one at this time. First question is from Brian Gong, Citi. Thanks, Madison, for taking the question. A very quick question for our strategist ahead. Our online marketing services are growing rapidly, kind of showing a different trend versus learning services. From a strategy perspective, will online marketing services become more important than learning services in the future? Thank you. Hi, Brian. Right now, we are experiencing a higher growth for ads compared with learning services. In the long term, we actually see great opportunities on both areas. Let me explain that for you. The strong expansion of our marketing services over the past three years has been mostly driven by, first, our advanced ad tech and AI capabilities, then customers' trends to transition from traditional ads to performance ads, and finally, opportunity of overseas ads. Since the advertising revenue first exceeded RMB 200 million in a single quarter in Q4 2022, it has reached a record high of over RMB 700 million this quarter, representing a year-over-year increase of more than 50%. As we've discussed several times on this call, we believe our advertising business is still in the early days. The application of generative AI and agentic AI in online advertising is only just beginning. We see 2025 as the first year when generative and agentic AI will be put to work on ads at scale. We launched our Youdao iMagicBox ad creative platform in Q1 and our AI ad placement optimizer and ad automation agent in Q2. These AI-driven improvements in delivering the ads have strengthened the customer satisfaction already, which in turn encourages advertisers to allocate larger budgets to our platform, accelerating our growth from a customer expansion perspective. We continue to see substantial opportunities across online games, e-commerce, overseas online games, overseas electronics, and through our deepening collaboration with partners such as Google and TikTok. With all these reasons, we believe these will all drive strong revenue growth for the coming years, hopefully. On the other side, we also see very good growth opportunities in our learning services business. This part of our business, as you probably know, has undergone quite significant changes over the past two years, largely because we actually believe there is tremendous long-term potential to see AI-driven online services. AI is a decade-long growth trajectory, and capturing it requires us to build and scale truly AI-native services and applications, and that's what we've been doing. On AI-driven subscription services, this part, we began sharing our progress since last year, and the trajectory is very promising. Total sales of AI-driven subscription services amounted to approximately RMB 50 million in the first quarter of last year, if you remember. It took us only six quarters to double that figure, reaching approximately RMB 100 million this quarter. We are actively developing new features, applications, and agents to support future growth expansion. A lot of agents are running inside our companies to improve our business efficiency. We see ample product optimization opportunities ahead and expect the growth to continue. In the digital content segment, the learning content, we have fully completed the restructuring and have sharpened our focus on the Lingshu business. In Q3, Youdao Lingshu delivered over 40% year-over-year growth in gross billings and demonstrated strong user stickiness and retention rate exceeded 75%. Adding all that up, in the near term, we expect net revenues from the entire learning services segment to return to year-over-year growth. In summary, we remain firmly committed to driving growth across both our learning and advertising businesses by continuing to serve our customers better and also leveraging AI technologies better. Yeah, thank you. Thank you. Next question is from Linda Huang McGuire. Hello, can you hear me? Hello? Yes. Yes, we can hear you. Yes. Yeah. Thank you very much for this opportunity. My question is regarding the online advertisement. It seems the second quarter this year, we noticed that the gross margin below, I think, below 30%, maybe around 25%. I just want to know, does the manager have any plan or a timeline? We can return back to above 30%, and what will we need to do to make sure that the margin can recover? That is for online marketing. Thank you. I'll answer this briefly before Jinlei provides more details. We always operate with the long-term view and aim to increase the value we create for advertisers. We think that's most important. In Q3, we saw strong opportunities to grow the customer base. We chose to engage and onboard more customers, and that is reflected in the revenue growth. You can see very, very quick revenue growth. On the flip side of that, we basically gave up some short-term gross margin as new customers are less profitable, and sometimes even we operate at a loss for particular important customers. That is actually also true, I believe, for the learning side of the business. I just wanted to mention in Q3, we invested in hiring more personnel for expanding our Lingxi across business in Q3, also for future growth. We believe this kind of investment are very good investments, and we have solid and profitable unit economics. We ensure we have that, and we think investments like these are going to translate to growth and profitability in the coming quarters. Hi, this is Jin Lei. Regarding the gross margin of our online marketing services business, the major parts are adopting the performance-based advertising pricing model and the gross method revenue recognition, which necessitates a balance between delivering value to our clients and sustaining our own healthy long-term development. Against this backdrop, we consider gross margin within the range from 25%-35% to be a reasonable target. Our current objective is to drive an improvement in gross margin, which we aim to achieve through several key initiatives. First, we plan to broaden the application of the iMagicBox creative production platform throughout the ad creation process. Compared to manual creation production, iMagicBox reduces production costs by approximately 70% while improving production efficiency. By leveraging our end-to-end data chain to identify and analyze high-performing creatives, we can scale the application, better serve our clients, and enhance overall delivery efficiency. Second, we will continue to optimize and upgrade our data management platform, DMP, and programmatic delivery system. This includes extending data dimensions and mining underlying data characteristics to improve audience and targeted insights. Those enhancements will enable more systematic and process identification of targeted audiences, leading to a higher advertising delivery effectiveness. Third, we will capitalize our robust AI capabilities to further integrate AI-driven creative production with the advertising delivery process. By closely linking those functions with the data capabilities of our DMP, we aim to establish an automatic closed-loop system that boosts the overall operational efficiency of our online marketing services. Thank you. Thank you very much. Next question is from Brenda Zhao, CICC. Good evening, Zhou Feng and Su Peng. Thanks for taking my question. My question is also related to the profit margin because we see the operating profit experience a year-over-year decline in the third quarter. What is the potential for rebound to year-over-year growth in the fourth quarter? Thank you. Thank you, Brenda. This is Su Peng. I will handle the question first. I think at the beginning of this year, we set the two full-year financial goals. First is to achieve the directly year-over-year improvement in operating profit. Secondly, to achieve the break-even in full-year operating cash flow. If you see the performance of Youdao in the first half of this year, especially in the operating profit, it's in the operating profit in this year, in the first half of 2025, I mean, it's much better than that in the last year at the same time. Improving from the CNY 40 million loss to the CNY 130 million gain. I think that provides more flexibility for us to make more investments in the second quarter of 2025. We step in the investment in Youdao Lingshu in advertising the customer acquisition while maintaining the profitability. We also start to spend the marketing dollars to acquire the potential clients for the advertisement business. From the third quarter, as the doctor mentioned before, in our earnings call, Youdao Lingshu delivered over 40% year-over-year GMV growth and increased the retention rate to over 75%. We achieved revenue of advertisement growth over 50% in Q3 in 2025. The new clients account for over 30% of the total clients. I think that will create great momentum and fundamentals for our business in Q4 and next year. All for our fourth quarter's priorities. At the same time, I just try to explain in more details regarding the impact of our three-quarter learning service business and in the doctor mentioned before. In the last year, STEAM courses still account for a meaningful percentage of our revenue for our learning services. At the same time, in summer, we shrank a lot significantly for the investment and for the STEAM courses and for the customer acquisitions, but still delivered significant revenues in Q3. That definitely has the impact on our profitabilities in the last year. That means the kind of high base we mentioned before. I think that's one of the impacts only for this year. Our fourth quarter's priority is to secure the rapid operating profit improvement from the full-year perspective online at the start of the year. In the meantime, we will continue to invest in our core business, Youdao Ling Shi, AI apps, as well as the online marketing services, as we assess the macro environment and our growth opportunities. Through this focus approach, we aim to deliver greater values to an expanding user space. Our medium to long-term focus is on executing AI-native strategies, accelerating the deployment of our large language model computers in learning and advertising scenarios. Central to this effort is enhancing our sustained profitability while constantly evaluating the quality of our user services. Since its launch three years ago, our AI interactive services of Youdao Ling Shi has integrated AI across the multi-scenarios, including the user's learning assessment, personalized learning of the past recommendations, QA sessions, assignment greeting, and as well as the college application consultings. This has enhanced the learning efficiency and outcome for users, generating best-ride positive feedback. At the highest gross margin business within our learning services segment, and following the recent restructuring of this segment, Youdao Ling Shi is expected to account for the growing share of segment revenue. This, in turn, is expected to continue to improve the profitability of the learning services segment in the long run. Regarding the online marketing services, as noted previously, AI contributes to enhance the delivery and operational efficiency in area, including the added creative production, data mining, programmatic delivery, and also attribution analysis. These advancements deliver in midterm and long-term the profitability improvement of these segments. I hope that answered your question. Thank you. That's very helpful. Thank you. Next question is from Bo Zhang Huatai. Hello. Thanks for taking my question. My question is, given the cumulative net operating cash outflow recorded in the first three quarters, should we expect any change to the full-year break-even target? Thank you. Thank you, Zhang Bo, for the question. This is Wei. Our team assessed great importance on the performance of our operating cash flow, and we already got remarkable improvements in optimizing our operating cash flow performance in recent years. For 2025, we set a target to achieve full-year cash flow break-even, and we remain very confident to achieve this target. At the same time, I would like to emphasize that reaching this break-even point is only a near-term milestone. Our long-term objectives definitely are to deliver even healthy performance in our operating cash flow through sustained profitability enhancement, disciplined credit management, and optimized working capital practice. As you mentioned, for the first nine months this year, cumulative net operating cash flow amounted to under RMB 129 million. However, it reflects over 40% significant improvements on a year-over-year basis. In addition, our quarter cash flow performance has obvious seasonal features, which are driven by certain seasonal factors. For example, Q1 is typically a new bonus payment period due to the Lunar New Year, and Q3 is traditionally peak user acquisition period, during which operating cash flow typically registers net outflow due to the marketing investment. In contrast, Q2 and Q4 are retention-driven seasons and generally demonstrate stronger cash flow performance. We expect the fourth quarter usually generates good operating cash inflow. To provide context, as you know, we achieved operating cash inflow of RMB 158 million in Q4 last year. As previously highlighted, our restructuring in learning services has been complete. Youdao Ling Shi, in particular, has demanded robust retention momentum in Q4, maintaining a retention rate above 75%. Additionally, another prepared service, our AI-driven subscription services, Q3's sales from these businesses have accelerated growth to over 40% year-over-year, which also positively supports our cash flow position. On the other hand, the expansion of our advertising business potentially brings certain collection dynamics, which potentially slows down the cash inflow from our customers. For example, online marketing services typically provide a certain curtain to our premium clients. Through results from the three quarters, we are satisfied for the performance of cash collections, and the curtain will manage. Taking into account the distinct seasonality of our operations, the significant year-over-year cash flow improvements in the first three quarters, and the potential strong retention performance from Youdao Lingshu in Q4, we maintain confidence in achieving our full-year operating cash flow break-even target. Thank you. Thank you. That's helpful. That concludes our question and answer session. I would like to turn the conference back over to management for any additional or closing remarks. Thank you once again for joining us today. If you have any further questions, please feel free to contact us at Youdao directly or reach out to Pearson Financial Communications in China or the [U.S.]brackets Have a nice day. Ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect your telephone.