Thank you for standing by, and welcome to the iQIYI third quarter 2022 earnings conference call. All participants are in a listen only mode. There will be a presentation followed by a question and answer session. If you wish to ask a question, you will need to press the star key followed by the number one on your telephone keypad. I would now like to hand the conference over to Ms. Chang Yu, Director of the company. Please go ahead. Thank you, operator. Hello everyone, and thank you for joining iQIYI's third quarter 2022 earnings conference call. The company's results were released today and are available on the company's investor relations website at ir.iqiyi.com. For the call today, our CEO, Mr. Yu Gong, will give a brief overview of the company's business operations and highlights, followed by our CFO, Mr. Jun Wang, who will go through the financials. After the prepared remarks, the senior management team will join Mr. Gong and Jun in the Q&A session. Before we proceed, please note that the discussion today will contain forward-looking statements made under the Safe Harbor Provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from our current expectations. Potential risks and uncertainties include, but not limited to, those outlined in our public filings with the SEC. iQIYI does not undertake any obligation to update any forward-looking statement, except as required under applicable law. With that, I will now turn the call over to Mr. Gong. Please go ahead. Hello, everyone. I'm very pleased to take this opportunity to report on our progress on the third quarter and share our views on the business. Efforts in the first three quarters this year, iQIYI has completed an iconic turnaround with business performance far exceeding the targets we set at the beginning of this year. There are two parts to this iconic turnaround. First, we have been growing the non-GAAP operating profit for four consecutive quarters, starting from Q4 last year. For the first three quarters this year, we achieved nearly RMB 1.2 billion in non-GAAP operating profit, a sharp reversal from the operating loss of RMB 2.5 billion over the same period last year. This non-GAAP operating profit in Q3 alone exceeded RMB 500 million. Meanwhile, we generated positive operating cash flow for two consecutive quarters. Second, our market leadership remains unchallenged, and our market share in September actually hit historical high on the content side. According to Enlightent data, we remain number one in terms of effective video views for our exclusive dramas, more than our competitors in the second and the third place combined. As for the mobile user metric side, we were also number one across core metrics, including user base, user engagement, and user signage. Our subscriber base has grown from 95.6 million on June 30th to 106.2 million on September 30th, representing a net addition exceeding 10 million. How did we largely improve financial performance while gaining market share? The key is our long-term commitment to original content. We are glad to see that the original content has become a main contributor to our content supply. Among the dramas we launched in Q3, 65% were original content at a historic high. Meanwhile, the hit ratio of our original content improved significantly. As many of you know, iQIYI's popularity index is an influential indicator of content popularity. Of the six blockbuster dramas with a popularity index of over 10,000 in our history, we launched four this year and two in Q3. Both are original titles. Hundreds of millions of users binge on our original content blockbusters, which drive up user base and market share, and that translate into the huge improvement in our financial results from loss to major profitability in a single year. Behind this title is our unique approach to content production and operation, which is our core competitive edge. As such, our iconic turnaround is very difficult for others to replicate, since it is based on our years of expertise and extensive library of original content. With original content as the key to our success, we will continue to execute our Calm Growth strategy. This means seeking value growth prompts while ensuring overall operating efficiency, enhancing content investment, and marketing spending. Appropriate. -appropriate manner. With this strategy, we will continue to provide users with appealing content and superior services, and further drive the healthy developments of business. Now, let's go through the detailed performance of our business segments, starting with membership services. Membership services have always been our most important business segment. We are determined to roll out strategies and allocate resources to support the continuous growth of our membership business. The average daily number of total subscribers in Q3 was 101 million. A net gain of 2.7 million compared with Q2. September was strong in particular. The number of subscribers at the end of September surpassed 106 million, grew by over 10 million compared to June 30th, and over 2.6 million compared to last September. We are happy to see that even after summer vacation ended, subscribers continued to grow in September for the first time in the past four years. The average daily subscribers of this September also reached its highest level compared to all the past Septembers. Based on our latest subscriber numbers, the strong momentum continues. Such success was mainly driven by premium content, indicating that users still have strong appetite in paying for excellent storytelling. Our core competitive edge lies around the ability of consistently supplying high quality content, discover and produce exceptional original content. Meanwhile, we track strategically emphasize on bringing more privileges to members across wider content category, which lead to improved monetization ability of our subscriber base. One important point to note is that original content has become a major contributor to our membership revenue. In Q3, the top three revenue contributors were all original content, namely, Love Between Fairy and Devil, Cang Lan Jue, Chasing the Undercurrent, Fa Zui, and The Heart of Genius, Tian Cai Ji Ben Fa. Our multi-season variety show, The Rap of China 2022, also adapted earlier access for subscribers, and ranked among the top five revenue contributors for the quarter. On a separate note, membership services revenue was slightly below our expectation in the third quarter. This was mainly driven by three factors. First, the temporary decline in consumer sentiment in May, June, and July due to pandemic resurgence. Second, the delay of certain key dramas. Third, the significant reduction of marketing spending as part of our business stress test. Starting from the second half of August, we successfully reversed the trend with a series of premium content releases, including Love Between Fairy and Devil, Chasing the Undercurrent, and Thousand Years for You, Qing Jun. The reasonable increase in marketing spending and the recovery in consumer sentiment also contributed positively to strong growth in subscriber numbers. This September marked as the strongest September in our history. This means the strong performance of our membership business was not fully reflected in our Q3 results. In Q3, our monthly ARM continued to grow annually, had a small dip sequentially. We offered promotional discounts during summer season to encourage more users to experience our service at a relatively low price point. We believe the value created by these subscribers will be reflected in the future. Moving on to content strategy and the performance. In the past three quarters, we achieved a significant result improving both quality and efficiency. Even though we launched fewer titles than last year, we are able to generate more premium works. The performance of our dramas was outstanding in Q3, especially for original dramas, as we had big improvement in areas such as content supply, revenue contribution, success rate, and word of mouth. One of the best way to understand this success of content is to understand our commitment to the original content strategy that we set long ago. Our performance during the quarter was not accident, and it's replicable. Our investments in original content over the past years have been productive and bearing fruit. I'd like to share some data. Among major drama launched in Q3, original dramas accounted for 65%, the highest in our history. Meanwhile, the success rate for original content have also increased. Two dramas broke the iQIYI popularity index of 10,000 in Q3, with two more dramas breaking 9,000 score. All four were original content. This breakthrough in original content was driven by the unique and effective content methodology we established, which we have soon processed with content creation and production to post for all the testing, powered by a strong team of professionals and supported by a mature and high efficient operating mechanism. First, we focused on improving the content creation and the production qualities of our in-house studios. We also have sophisticated supporting teams with highly experienced professionals across different functions backing these studios through the entire process. We have established a mature and highly efficient mechanism right from the whole process, enabling highly efficient decision-making, a strict quality control, and optimal content scheduling. The key to this mechanism is a profound understanding of the content industry as a whole, based on over a decade of experiences in the industry. This forms a high barrier that is hard to break through in the short term. The breakthrough in original content have improved the overall quality and influence of our content, gave us absolute advantage as the industry leader. In terms of market share in September, effective views of our dramas ranked number one, with the greatest lead in our history. Effective views of our exclusive drama took an absolute lead, more than the sum of the competitors in the second and the third positions according to Enlightent. In terms of popularity, we launched the iQIYI popularity index back in 2018, and since then, only six titles received a score above 10,000, and 22 titles received a score above 9,000. In other words, titles with a popularity index of over 10,000 are considered potential franchise titles, and over 9,000 are household blockbusters. Among the top six popular dramas, four were released this year, and two in Q3. For the first nine months, a total of seven dramas broke 9,000. Our content has also received great word of mouth. Users actively discuss, rate, and recommend our content on social platforms. On a third-party platform, Douban.com, nine of our drama launched in Q3 received a rating of over seven, the best quality performance in our history. The performance was driven by our carefully refined content scheduling based on our content reserve and user demand. For the two drama breaking in a popular index of 10,000 in Q3, Love Between Fairy and Devil tapped into the demand of young generation audience during the summer vacation. Its creative storytelling set it apart from other titles on the same genre. Chasing the Undercurrent, although the storyline is oriented to our relatively mature users, but well-liked by a wide range of age groups, and with high view completion rate. In addition to drama, we maintained our output of premium content in other categories. For variety shows, the effective views of multi-season show, The Rap of China 2022, was leading the online variety show market in Q3. The second season of the Super Sketch Show has attract the largest advertising budget among the variety show we launched this year. In addition, our original animations recorded solid growth in both the number of titles launched and the revenue. During the quarter, our IP franchise format also achieved a great performance. We launched both the original drama and animation based on the same IP, Love Between Fairy and Devil, and saw great synergies. Membership revenue of this original animations stayed at number two on the animation channel until summer vacation, just behind the Japanese animation, One Piece. Entering into Q4, we will maintain the strong momentum of Q3 by launching a number of highly anticipated dramas, including New Life Begins, Qing Qing Ri Chang, Wild Bloom, Feng Chui Ban Xia, featuring top leading actress, Zhao Liying, and Unchained Love, featured Dylan wang, Chen Yuqi. The leading actor from our blockbuster drama, Love Between Fairy and Devil this summer. We continue to explore new content themes that cater to diversified user demand, such as a recently launched drama series selection targeting female audience. Place also anticipated a good selection of variety shows, children's animation, and movie slates for release. Moving on to advertising. Similar to our peers, we fought against the macro headwinds and increased advertising revenue by 4% sequentially. For brand advertising, the revenue recovered sequentially, and the year-over-year decline narrowed compared with last quarter, reflecting the attraction of hit drama and variety shows in the peak summer vacation season. We saw sequential recovering in the number of brand ad clients in Q3, as well as recovering of ad demand for international brand advertisers. For per-performance ads, we saw revenue increases both annually and sequentially. Heading into Q4 and next year, we face the same challenges as our peers. Q4 is a traditional off-season for advertising and macro recovery takes time to be reflected in advertising budgets. Currently, we expect continuously sequentially recovering in advertising business for Q4. Q4. For next year, if macro economy recovers and with a bit absence of a pandemic resurgence, we shall anticipate to see over a year-over-year recovery also. Technical innovation has always been part of our core values. We are committed to bring the best entertainment experience to our user. At the same time, we hope to promote the industrialization of long-form videos to drive the, robust development of the Chinese video industry. This ambition is reflected in our daily work as our engineering team focuses on, every product detail. A recent example of our approach to product improvement was the optimization of the bullet chat quality and the distribution algorithm, which improved the user interaction and stickiness. Average daily number of users that, activated the bullet chat feature increased year-over-year in Q3. The daily average number of bullet chat interaction increased by 50% year-over-year. We also continue to utilize in-house development, developed tools to improve content production efficiency. The iQIYI video production management system acts as an efficient tool to help production teams. By the end of Q3, the system have been applied to five iQIYI original dramas. In addition to improving efficiency and production quality, the system also saves costs and effectively controls budgets. For overseas business in Q3, we saw healthy growth in membership revenue both annually and sequentially, reflecting the popularity of our premium content and improved operating capability. Premium content launched during the quarter had a solid result both in terms of monetization and word of mouth. Huge Chinese dramas on our domestic main app also performed very well overseas, further exceeding the IP value on a large scale. A top drama under our Sweet On Theater brand, including Love Between Fairy and Devil, and Thousand Years for You, have strong performance. Premium content also drove improvements in monetization. For example, advertisers recognized the value of our theater mode, we attract partners such as Lazada and Realme as title sponsors for Sweet On Theater in Thailand. In the first three quarters of 2022, we again demonstrated the powerful execution abilities, professionalism, and a strong unity of everyone within iQIYI. For three consecutive quarters, we outperformed continuously improving fundamentals, demonstrating our value to everyone. We achieved a growth in market share while significantly improving our financial performance. As content is our core competency, we are confident that we will be able to deliver blockbusters on a continuing basis as we have worked out replicable methodologies for both original content production and operation. These methodologies lay a solid foundation for healthy growth. We believe that we have achieved an iconic turnaround in the context of an extremely challenging macro environment this year. We will continue to deliver values both to users who love our content and as stakeholders who are as confident as we are in the prospective of long form video. Now, I will hand over to Wang Jun for financial details. Thanks, Mr. Gong, and hello, everyone. In Q3, we booked RMB 7.5 billion in total revenues, up 12% sequentially. Our non-GAAP operating profit reached RMB 524 million, increased 53% sequentially. Meanwhile, we have been generating positive operating cash flow for 2 consecutive quarters and recorded nearly RMB 200 million operating cash flow in the third quarter. These encouraging results demonstrated the resilience of our business under extremely challenging macro environment and the pandemic resurgence. Within the revenue line, we recorded membership service revenue of RMB 4.2 billion. As Mr. Gong mentioned in his opening remarks, the performance of our membership businesses was backloaded, and the current Q3 result is not a full reflection of the strong momentum we observed. During the quarter, the number of subscribing members grew from 95.6 million as of June 30, 2022, to 106.2 million as of September 30, 2022, representing a net addition of over 10 million during the quarter. move to the cost and ex-expenses. The third quarter cost of revenues was RMB 5.7 billion, representing a cost saving of RMB 1.3 billion compared with the same period last year or down 19% annually. The accounting cost, the significant component of cost of revenues, decreased 18% annually and up 12% sequentially. This sequential increase is the result of operational initiatives under our Calm Growth strategy. We launched more hits during the quarter, bringing more subscribers and generating more profits, which forms a virtuous cycle. Our gross profit margin, which is a direct metric to reflect the ROI of our content businesses, consistently expanded in the past four quarters and reached a historical high of 24% in third quarter compared with 7% in the same period last year. Meanwhile, with the continuous optimization of our business operations, our total expenses, operating expenses decreased by RMB 470 million year-over-year. The expanded gross margin and disciplined operating expenses combined contributed to our non-GAAP profit expansion. For Q3, the non-GAAP operating profit was RMB 524 million, compared with the non-GAAP operating loss of RMB 1.1 billion for the same period last year. It's up 53% quarter-over-quarter. At the end of the third quarter, the company had a cash equivalents, restricted cash and short-term investments of RMB 5.0 billion, compared with RMB 4.9 billion in the previous quarter. Our operating cash flow reached RMB 196 million during the quarter. Going forward, we will continue to execute the Calm Growth strategy and our commitment to achieve healthy business growth remains unchanged. We are confident in our ability to generate value for our stakeholders in the long run. For detailed financial data, please refer to our press release on our IR website. Now I will open the floor for Q&A. Thank you. If you wish to ask a question, please press star then one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star then two. If you are on a speakerphone, please pick up your handset before pressing the keys. Participants are asked to please limit their questions to one per person and to rejoin the queue to ask further questions. Please also ask your question first in Chinese and then English. The first question will come from Thomas Chong of Jefferies. Please go ahead. 晚 上 好 ， 谢 谢 管 理 层 接 受 我 的 提 问 。 我 的 问 题 是 关 于 会 员 的 表 现 的 ， 可 不 可 以 再 多 解 释 一 下 整 体 Q3 的 会 员 的 表 现 的 情 况 。 在 未 来 会 员 收 入 增 长 的 主 要 的 驱 动 力 呢 ， 会 是 会 员 数 还 是 ARM 那 边 ， 具 体 的 驱 动 力 会 有 哪 些 的 ？ Thanks management, for taking my questions. My question is about the membership business. Can management talks about the Q3 overall membership business performance as well as the growth driver? Is it coming more from the number of subs or from the ARM side? What are the key drivers going forward? Thank you. 好 ， 谢 谢 ， 我 是 龚 宇 ， 我 回 答 这 个 问 题 。 这 个 问 题 大 概 两 个 方 面 ， 先 说 Q3 的 一 些 表 现 。Q3 的 这 个 会 员 的 收 入 ， 因 为 一 些... 3， 主 要 是 3 个 原 因， 稍 微 有 些 这 个 总 体 下 降。 第 一 个 原 因 就 是 5、6、7月 份， 因 为 中 国 上 半 年 疫 情 的 影 响 导 致 消 费 者 意 愿 下 降， 这 个 6月 份 7月 份 的 时 候 我 们 有 些 计 划 中 的 内 容 延 迟 上 线， 然 后 同 时 呢 我 们 有 些 过 度 地 缩 减 了 市 场 费 用， 所 以 导 致 这 个 Q3 初 的 时 候， 前 半 段 的 这 个 成 绩 不 太 好。 这 个 8月 份， 这 个 消 费 者 意 愿 回 升， 我 们 自 己 加 大 了 这 个 内 容 的 投 入， 市 场 的 投 入， 然 后 这 个 上 线 的 内 容 也 如 期 上 线 了， 所 以 这 个 拉 动 了 会 员 的 增 长。 因 为 是 8月 下 旬 以 后， 会 员 的 增 长， 所 以 对 8月， 对 Q3 的 收 入， 正 面 影 响， 有 一 部 分， 但 是 没 有 完 全 影 响 到 整 个 季 度。 I'll translate for Mr. Gong. The slight decline in membership revenue was due to three factors mainly. First, the temporary decline in consumer sentiment in May, June and July due to the pandemic resurgence in the first half of the year. Second, the delay of certain key dramas during June and July. Third, the significant reduction of marketing spending as part of our business stress test. Starting from the second half of August, we successfully reversed the trend with a series of premium content releases, including Love Between Fairy and Devil, Chasing the Undercurrent, and Thousand Years for You. Also, the reasonable increase in marketing spending and recovery in consumer sentiment also contributed positively to strong and continuous growth in subscriber numbers. Our membership services revenue grew from a relatively lower base of the sub number in July. The strong subscriber number growth started to pick up in August. The performance of our membership business was backloaded and the current Q3 result is not a full reflection of the strong momentum we observed. 呃 ， 三 季 度 三 个 月 当 中 有 两 个 月 是 暑 期 ， 在 暑 期 中 有 大 量 的 学 生 用 户 ， 他 是 我 们 的 会 员 的 潜 在 用 户 ， 所 以 我 们 用 了 一 些 暑 期 ， 呃 ， 通 常 使 用 的 促 销 手 段 ， 呃 ， 所 以 也 会 导 致 ARM 值 ， 呃 ， 有 比 较 小 程 度 的 一 个 下 降 。 Okay. In Q3, there are two months is for the summer vacation, and among our user base, there are a large number of students in this group, they are the potential users for us. We offered promotional discounts during the summer season to encourage more users to experience our services at a relatively lower price point. That's why it caused some of the fluctuation in ARM for the third quarter. 对 于 未 来 会 员 业 务 的 看 法 是 ， ARM 值 和 会 员 数 ， 同 时 的 ， 促 进 会 员 收 入 的 增 长 。 对 于 这 个 会 员 数 的 增 长 的 主 要 驱 动 力 来 自 两 方 面 ， 一 方 面 是 内 容 的 投 入 ， 还 有 一 个 方 面 是 市 场 方 面 的 投 入 。 内 容 投 入 主 要 指 的 是 头 部 内 容 的 投 入 。 For our entire sub-membership business going forward. Our main goal is to grow the membership services revenue, while achieving healthy performance on the subscriber numbers and ARM. In terms of growing the sub numbers in the future, it comes from two aspects. One is the continuous investment in content, namely especially for the head premium content, and also the second point is continuing investment in market spending. 嗯 ARM 值 的 增 长 ， 那 很 简 单 ， 无 非 就 来 自 于 两 个 因 素 ， 第 一 个 因 素 相 对 于 过 去 一 年 同 期 ， 呃 这 个 促 销 打 折 的 减 少 。 另 一 方 面 ， 根 据 行 业 发 展 的 情 况 ， 呃 存 在 这 个 就 是 月 票 价 上 涨 的 可 能 性 。 For the ARM growth, it comes from two reasons. One is the lowering of the discounts in the past years, and also that increasing the listing price of our member to business. Thank you. Thank you. The next question comes from Alicia Yap of Citigroup. Please go ahead. Hi, thank you. 管理层 晚上 好，谢谢 接受 我的 提问. 恭喜！非常 强劲 的 业绩. 我的 问题 是 跟 那个 内容 有关，我们 近期 成功 发布 了 多部 这个 热播剧，然后 也 获得 了 很好 的 表现. 想 请 管理层 能 和 我们 分享 一下，就是 说 iQIYI 将 如何 确保 就是 未来 的 这个 自制 剧 的 内容 同样 会 有 很高 的 这个 爆款率. 好 我 自己 翻译 一下. Good morning, thanks for taking my... I mean good evening, thanks for taking my question. Congrats on the strong results. My question is related to the video content. iQIYI has successfully released a number of hit drama this quarter this year, that received very good feedback. Can management share with us, how will iQIYI ensure in the future that you will also have a very high hit ratio for your drama? Thank you. 好 ， 这 个 问 题 是 内 容 业 务 方 面 的 ， 我 们 请 我 们 的 首 席 内 容 官 王 晓 晖 来 回 回 答 。 This question is content related. I will invite our Chief Content Officer, Xiaohui Wang to answer this question. 谢 谢 。 大 家 好 ， 我 是 Xiaohui Wang 。 我 来 回 答 这 个 问 题 。 iQIYI 是 从 2018 开 始 实 行 那 个 热 度 值 这 个 指 标 。 在 实 行 这 个 指 标 以 后 ， 我 们 一 共 出 现 了 6 部 热 度 值 破 万 的 爆 款 剧 ， 其 中 有 4 部 出 现 在 了 今 年 ， 而 就 有 2 部 是 出 现 在 了 刚 刚 过 去 的 Q3。 这 说 明 经 过 长 期 的 坚 持 和 努 力 ， 自 制 内 容 已 经 成 为 了 iQIYI 爆 款 内 容 的 主 力 军 之 一 。 We launched the iQIYI popularity index back in 2018. Since then, only six titles received a score above 10,000. Four were released this year and two in Q3. This perfectly demonstrates that through a long term commitment to original content, the original content has become one of the main contributors to our blockbuster content. 呃 总 结 过 往 的 经 验 呀 ， 呃 大 致 呃 有 了 三 方 面 的 原 因 ， 促 成 了 现 在 这 样 一 个 结 果 。 呃 第 一 呢 ， 就 是 我 们 还 是 构 建 了 以 风 格 多 样 、 专 业 人 才 组 成 的 工 作 室 为 核 心 的 一 个 强 大 的 自 制 团 队 。 同 时 呢 ， 我 们 公 司 内 部 呢 ， 是 从 创 意 生 产 到 播 后 的 全 流 程 的 终 台 支 持 能 力 ， 提 供 了 在 一 个 科 学 机 制 下 的 一 个 坚 强 的 一 个 后 盾 ， 这 包 括 了 内 容 创 意 啊 、 生 产 呀 、 播 出 啊 、 宣 传 等 多 个 辅 助 部 门 都 能 够 从 各 自 的 业 务 角 度 出 发 ， 来 提 供 更 为 科 学 的 支 持 。 The success was mainly contributed from three factors. First, was mainly attributable to the powerful production team that we have built, through our in-house studios, which contains highly experienced professionals with various creative styles. We also have very sophisticated supporting teams across different functions to support these studios through the entire process, which runs through processes from creative ideas development, content production, broadcasting and marketing. 比 如 从 剧 本 层 面 来 说 吧 ， 我 们 依 靠 了 专 业 的 团 队 和 比 较 宽 松 的 创 意 的 筛 选 空 间 来 配 合 剧 本 的 精 细 打 磨 ， 来 为 内 容 供 给 呢 进 行 长 期 持 续 的 蓄 力 ， 来 保 证 良 好 的 内 容 ， 有 一 个 好 的 创 作 基 础 。 At the script level, we rely on the professional teams and give them relative flexibility in screening the creative ideas emphasized on polishing scripts, which build a solid foundation for the content creation process. 比 如 在 制 作 层 面 ， 有 良 好 的 创 作 基 础 作 为 保 障 以 后 呢 ， 我 们 配 合 严 谨 的 开 机 策 略 ， 然 后 配 合 富 有 专 业 、 创 新 和 靠 谱 的 合 作 伙 伴 ， 然 后 用 科 学 的 选 角 机 制 来 选 择 最 合 适 的 主 创 演 员这 些 都 保 证 了 我 们 项 目 持 续 的 创 新 度 和 高 品 质 。 At the production level, once we have the solid content creation foundation in place, we will follow by rigorous process before projects entering into the filming process. We will collaborate with highly professional, creative and reliable partners in the production process. Select the most suitable actors based on our comprehensive casting mechanism. All of the above will safeguard the continuous creativeness and the high quality of our original production. 第 二 个 方 面 的 原 因 呢 ， 是 我 们 已 经 形 成 了 一 套 比 较 成 熟 高 效 的 一 套 运 营 机 制 。 这 个 机 制 呢 ， 其 实 贯 穿 了 我 们 从 创 意 生 产 到 播 后 的 全 流 程 ， 实 现 了 一 个 高 效 决 策 、 品 质 的 严 控 ， 以 及 根 据 用 户 的 需 求 能 够 有 效 合 理 的 去 排 播 内 容 。 未 来 我 们 还 会 持 续 在 内 容 创 意 的 多 元 性 和 制 作 决 策 的 严 谨 性 上 来 寻 求 有 效 的 平 衡 ， 以 生 产 更 多 的 爆 款 内 容 。 The second factor was contributed by we have established a mature and highly efficient mechanism running through the entire process, from developing an idea into original drama series to broadcasting and marketing it. This mechanism enables highly efficient decision making, strict quality control, and optimal content scheduling based on user preferences. Going forward, we will continue to seek an effective balance between embracing the diversity of content creativeness and efficiency in the production process. 呃 第 三 个 方 面 的 原 因 呢 ， 就 是 我 们 的 制 作 -- 呃 智 能 制 作 系 统 也 逐 渐 成 熟 起 来 ， 在 一 定 程 度 上 为 我 们 保 持 一 定 的 爆 款 率 ， 提 高 效 能 提 供 了 有 力 的 支 持 。 The third aspect is that our intelligence production system is getting more sophisticated, which also helps in terms of increasing the possibilities of creating blockbuster content and improving efficiency. 谢 谢 。 Thank you. The next question comes from Lei Zhang of Bank of America Securities. Please go ahead. 嗨 管理层 晚上 好，谢谢 接受 我 的 提问。我 的 问题 主要 是 关于 财务 方面 的。我们 这个 季度 的 运营 现金 流 跟 这个 free cash flow 同比 跟 环比 都 有 比较 明显 的 改善，而且 free cash flow 也是 首次 转正 了，所以 想 请 管理层 可以 分享 一下 主要 的 驱动 因素 有 哪些，还有 这个 趋势 是 不是 可以 持续 的，我们 怎么 看 未来 几个 季度？ Thanks management for taking my question, and my question is mainly regarding, cash flow. Noticed that we have a meaningful improvement in free cash flow and operating cash flow with a positive free cash flow this quarter. Can you give us more color on the driver behind this, and how should we look at the trend going forward? Thank you. 好 的 。 谢 谢 。 我 是 Jun Wang。 这 个 问 题 我 来 回 答 吧 。 我 待 会 我 自 己 翻 译 一 下 。 就 是 从 我 们 角 度 来 看 的 话 ， 首 先 第 2 块 问 题 是 更 加 容 易 回 答 ， 就 是 我 们 非 常 的 确 定 这 个 趋 势 可 以 持 续 ， 并 且 是 有 信 心 ， 有 信 心 达 到 这 个 结 果 。 从 为 什 么 会 这 样 呢 ？ 就 是 如 果 我 们 看 到 回 顾 一 下 ， 我 们 做 这 个 turnaround 整 个 的 这 个 流 程 的 话 ， 会 发 现 呢 ， 我 们 的 起 点 ， 我 们 一 开 始 的 起 点 其 实 是 费 用 控 制 ， 是 降 本 增 效 ， 是 注 重 内 容 的 ROI， 是 注 重 我 们 的 这 个 品 质 输 出 ， 这 是 我 们 的 起 点 。 过 去 的 3 个 季 度 ， 其 实 我 们 一 直 在 持 续 ， 一 直 在 持 续 做 这 事 情 。 在 第 3 季 度 的 时 候 ， 我 们 确 确 实 实 看 到 了 一 些 非 常 新 的 ， 给 我 们 看 到 一 些 非 常 新 的 一 个 这 个 表 现 ， 这 些 新 的 表 现 呢 ， 其 实 是 带 来 了 更 好 的 趋 势 的 ， 应 该 讲 更 好 的 趋 势 的 可 能 性 。 这 里 面 呢 ， 更 加 具 体 地 讲 ， 我 们 看 到 的 是 就 像 刚 才 我 们 讲 的 一 样 ， 内 容 的 投 入 更 多 了 ， 内 容 的 质 量 更 高 了 ， 爆 款 率 更 高 了 。 更 好 的 内 容 呢 ， 会 带 来 2 个 东 西 。 第 1 个 东 西 呢 ， 是 我 们 本 身 主 业 务 的 增 长 ， 包 括 我 们 的 这 个 会 刚 才 讲 到 的 会 员 数 的 这 个 增 加 ， 为 我 们 的 长 期 发 展 奠 定 一 个 基 础 。 与 此 同 时 呢 ， 也 会 带 来 我 们 的 一 些 derivative revenue 的 这 个 增 加 。 在 这 个 基 础 之 上 ， 因 为 我 们 用 户 数 的 增 加 ， 因 为 我 们 收 入 的 增 加 又 会 带 来 利 润 的 增 加 ， 而 利 润 的 增 加 又 带 来 现 金 流 的 增 加 ， 所 以 这 个 就 是 一 个 正 循 环 。 在 第 3 季 度 里 面 ， 当 我 们 看 到 这 样 的 这 个 正 循 环 的 时 候 ， 从 我 们 心 里 讲 ， 我 们 是 觉 得 更 加 encouraging， 也 是 更 有 信 心 的 。 Probably I will just trying to translate for myself. I think that to answer the second part of the question first, yes, we are very confident that this trend could continue in the future. Behind that, we do see if we can review the entire process of the turnaround, we will say that the starting point of the turnaround is a very disciplined expense management. It's a very ROI-focused content strategy, and we have been continued to do that throughout the three quarters. On top of that, in the third quarter, we do see some new catalysts coming in, and these new catalysts, including a virtual cycle, which starts when our investment in the content then our investment content generate more hits, more hit titles and give users more value proposition, which in turn attract the more members, then creating possibility for generating derivative revenues. On top of that, it will convert into the profit, then in turn bring us more free cash flow. We will certainly continue to do that, and we do believe this success is replicable, which support the trend, which support the positive free cash flow trend. This is point number one. On top of that. On top of that, we also like to comment that because we have been very much focused on original content as you guys have been, you know, asking questions around that. original content means IP value, and IP value can generate derivative revenues with higher margin, and this is consistent with our experience and observation of the media conglomerates globally. this, if not, this creates the whole new opportunities for the company in the future. Thank you. The next question comes from Daniel Chen of JP Morgan. Please go ahead. 晚 上 好 ， Xueqing Zhang ， 谢 谢 接 受 我 的 问 题 。 我 就 想 问 一 个 很 快 的 问 题 ， 就 是 关 于 这 个 ， 能 不 能 请 Xueqing Zhang ， 跟 我 们 讲 一 讲 ， 就 是 咱 们 观 察 到 的 这 个 长 视 频 行 业 的 最 新 的 这 个 内 容 监 管 的 情 况 。 谢 谢 。 Congratulate on the really solid result. My question is on the content regulation, overall environment, for the long form video. Could management share some color on this? Thank you. 在 去 年 年 底 之 前 的 将 近 1 年 的 时 间 ， 主 管 长 视 频 的 政 府 部 门 ， 主 要 是 广 电 总 局 ， 也 包 括 网 信 办 等 等 ， 出 台 了 很 多 政 策 ， 对 内 容 的 审 查 明 显 趋 严 了 ， 更 加 严 格 了 。 经 过 从 今 年 年 初 到 现 在 为 止 ， 行 业 已 经 形 成 了 新 的 常 态 ， 所 以 在 最 近 没 有 明 显 的 这 种 变 化 。 About 2021 is last year, in the, in the whole entire 2021, there are different authorities that rolled out different policies that kind of tightened the whole regulatory environment for the online video space. As we entered into 2022 until now, the regulatory environment seems to be relatively stable and we haven't seen major changes in such process. 对 于 iQIYI 来 讲, 内 容 方 面 的 策 略 是 减 少 数 量, 提 高 质 量. 对 于 长 视 频 行 业 也 同 样 是, 对 内 容 的 策 略 也 同 样 是 提 高 质 量, 降 低 数 量. 非 常 巧 合 的 是, 现 在 政 府 的 主 管 部 门 策 略 上 也 是 同 样 的, 减 少 这 个, 这 个 内 容 制 作 的 数 量, 行 业 内 容 的 数 量, 提 高 质 量, 所 以, 方 方 面 面 都 是 相 互 吻 合 的. The main current focus for us is to increase quality and optimize content quantity, which not only applies to us and our peers. We are glad to see that coincidentally, it also applies to the various government authorities. They would roll out policies that actually positive to such process. 对 于 iQIYI 来 讲 ， 经 过 3+ quarters 的 实 践 ， 那 个 就 是 最 好 的 内 容 数 量 和 合 适 的 这 个 针 对 内 容 的 这 个 市 场 投 入 ， 现 在 找 到 了 这 个 ， 这 个 最 合 适 的 这 个 点 ， 所 以 对 于 未 来 来 讲 ， 我 们 可 能 更 能 够 健 康 地 可 持 续 地 发 展 ， 也 就 是 实 现 我 们 Calm Growth strategy 的 目 标 。 After the three month, three quarters of time, for iQIYI, we now figure out perfect balance between the quantity that we show for content and also the amount of marketing spendings into this market to promote our content. Going forward, based on the success of our past three quarters and under the Calm Growth strategy, we believe that we can have healthy and sustainable growth for our business going forward. Thank you. Thank you. There are no further questions at this time. I'll now hand back to management for closing remarks. Thank you everyone for joining our call today. Please do not hesitate to contact the IR team or the management if you have further questions. See you next time. Thank you. Bye bye. Bye bye. Thank you. That does conclude our conference for today. Thank you for participating and you may now disconnect.