Good day and welcome to the Weibo Corporation Fourth Quarter 2015 Results Conference Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Ms. Vanessa Chen, IR Officer. Please go ahead.

Thank you, operator. Welcome to Weibo's quarterly [ph] earnings conference call. Joining me today are our Chairman of the Board, Charles Chao; our Chief Executive Officer, Gaofei Wang; and our Chief Financial Officer, Herman Yu. The conference call is also being broadcast on the internet and is available through Weibo's IR website. Before the management's presentation, I'd like to read you the Safe Harbor statement in connection with today's conference call. During the course of this conference call, we may make forward-looking statements that are not historical facts, including statements about our beliefs and expectations. Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Weibo assumes no obligation to update forward-looking statements in this conference call and elsewhere. Further information regarding this and other risks is included in Weibo's annual report on Form 20-F for the fiscal year ended December 31, 2014, filed with the SEC on April 28, 2015, and other filings with the SEC. Additionally I'd like to remind you that our discussion today includes certain non-GAAP measures, which excludes stock-based compensation and certain other expenses. We use non-GAAP financial measures to gain a better understanding of Weibo's comparative operating performance and future prospects. Our non-GAAP financials excludes certain expenses, gains or losses and other items that are not expected to result in future cash payments or that are non-recurring in nature or will not be indicative of our core operating results and outlook. Please refer to our press release for more information about our non-GAAP measures. Following management's prepared remarks, we will open the line for a brief Q&A session. With this I would like to turn the call over to our Chief Executive Officer, Gaofei Wang.

[Interpreted] Thank you and good morning. Welcome to Weibo's fourth-quarter 2015 earnings conference call. On today's earnings call, I will discuss our key developments in product, user and monetization areas, review the progress that we have made in 2015 and share with you our plan for 2016. First, let me discuss Weibo's revenue results. In the fourth quarter of 2015, Weibo maintained strong revenue and user growth. Weibo's total revenues grew 42% year over year to $149 million. Advertising and marketing revenue grew 47% to $130 million, with 65% of ad revenue coming from mobile. Non-GAAP net income in the fourth quarter reached $32.9 million, up 49% from the last quarter. For the full year, Weibo's 2015 total revenue reached $478 million, up 43% year over year. Advertising and marketing revenue totaled $402 million, up 52% year over year. Weibo was profitable throughout 2015, reaching a non-GAAP net income of $68.8 million. The rapid growth of Weibo's ad revenue can be attributed to our wide range of advertising and marketing products, which can meet the needs of different segments from individuals to small and medium size enterprise to large brand customers. In addition, the growth of Weibo ad revenue can also be attributed to the continuing growth of Weibo's large user base, positioning us to become an indispensable option for mobile advertising and marketing in China. Moving to users, Weibo's monthly active users reached 236 million in December, up 34% year over year, while average daily active users reached 106 million, up 32% year over year. In December 83% of Weibo MAUs were on mobile and mobile DAUs reached 94 million, up 46% year over year. In 2015 Weibo added 60 million MAUs and 26 million DAUs net. Weibo's large and growing user base has enabled us to become a…

Thank you, Gaofei. Good morning everyone and good evening to those of you in the west. Welcome to Weibo's fourth-quarter 2015 earnings call. As Weibo celebrates its sixth birthday in 2015, we are excited that Weibo has grown to become a leading social media in China with 236 million monthly active users as of December. Gaofei discussed our efforts to expand vertical content on Weibo which will make Weibo more relevant and targeted. As e-commerce further develops in China and shifts toward mobile Internet, we are seeing more and more e-commerce purchases being influenced by the recommendations from key opinion leaders and other Internet influencers, many of whom rely on Weibo to grow and maintain their fan base. As fans economy, or fanconomy, takes off in China, Weibo is benefitting, not only from the large amount of content created by the KOLs and other influencers, but also the associated monetization, for example, from native apps. This illustrates our strategy to grow the interest of Weibo users, content creators, and customers, concurrently. 2015 was an inflection point for videos, especially on mobile in China. And we are seeing short video consumption on Weibo taking off, at an amazing pace. In December, average daily video views grew 1,000% from the same period last year. We are excited about Weibo's unique ability to empower user-generated content, to get noticed, and become wildly popular. Our solid execution in traffic and content strategy in 2015 was reflected in Weibo's financial performance. 2015 marks the third full year of Weibo's monetization. Not only has Weibo achieved profitability this year, our adjusted EBITDA margin grew from 7% in the first quarter, to 25% in the fourth quarter. This illustrates Weibo's operating leverage as a social platform, powered by user-generated content. As our revenue further ramps, we believe…

Thank you. We will now begin the question-and-answer session. [Operator Instructions] Your first question comes from Tian Hou with T.H. Capital. Please go ahead.

Hi, Herman, Gaofei. I have a question related to your video. On the one hand, we are seeing rapid growth. And on the other hand, video is going to take a lot of bandwidth. So I wonder, going into 2016, what is your margin going to look like? That's the first question. I have one follow-up.

Good morning, Tian. This is Herman.

Hi, Herman.

Yeah. What we expect is that our video has taken off in the fourth quarter, and you're seeing that strong growth going into 2016. So I think, as we mentioned on our prepared remarks, that we expect to launch our video advertising later on this year. So I think, in the first few quarters, you'll probably see a couple of points margin happening. But as our video revenue takes off, you're seeing, over time, that our margins should recover from the video advertising that we generate. I think with respect to the exact margin impact, I think over the next few years we'll have to see how successful we are with video. But in general, we think that will probably cost us a couple percentage points.

Okay, got it. So for the verticalization strategy, I wonder what's the current verticals that's your -- are your priorities or the top verticals? And into 2016, what are some other verticals that you plan to expanded into?

[Interpreted] Yeah. For 2015, our key verticals that we focused on were e-commerce and entertainment related. And in 2016, we'll also add auto, and then also the e-commerce related to SMEs, mainly KOL commerce, key opinion leaders or internet influencers, which I talked about in our prepared remarks.

Thank you, Gaofei and Herman. So I'll give the floor to others.

Thank you. Your next question comes from Gene Munster with Piper Jaffray. Please go ahead.

Yeah, good morning. If you could talk, Herman, a little bit about the user growth. It's been pretty consistent at 30% for the past couple years, as you think about the addressable market for users -- daily active users, how big is that opportunity? And then, how should we think about that growth over 2016? Should there just be a natural deceleration, just given the large numbers, or any other comment? Thanks.

Hey, Gene, I missed the first part. You were talking about how big the opportunity is for -- could you elaborate on the first two sentences you made? It wasn't clear. It didn't come across.

In terms of the user growth. How should we think about user growth, going forward? It's been at around 30%, and should we generally think about that in 2016, or how should we think about the law of large numbers, related to the strength you've had in user growth? And then separately is just how -- what do you see as the addressable user opportunity in China? Thanks.

[Interpreted] Yeah, Gene. So if you look at our total user growth, we're growing over 30% in 2015. And if you look deeper in to our mobile user growth, we actually are seeing 46% year over year. So when you compare that to other social products in China, the largest social apps and so forth, we're growing significantly faster than they are. So I think if you look into 2016, one thing you'll see is that we'll focus continue on the growth of mobile users. And we hope to further penetrate lower-tier cities.

Okay. And then just a quick follow-up on the video theme. You talked a lot about it. In terms of when we could start to see more of an impact to the model, is it kind of 2017? Is that how we should be thinking about that?

You're talking about video revenues?

That's correct, yes.

Yes, I think -- we will be launching our video advertising products later on this year. I think in terms of how much impact there will be, I think we have to go through our trial phase first, before we can make an assessment. Typically, when a product launches, as you know, Gene, we first have to beta test it, and then we might have to tweak it. We have to educate the channel, and the customers know how to use it. But at the same time, if you look at how we have prepared for this, over the last year, we started with a Weibo TV program to put a lot of FMCG users and other ones that spend money on traditional media, and then boost up our video traffic. So I think the market in China is very well-trained on using online video advertising. So we'll have to see as we roll that product out.

Great. Thank you.

Thank you. Your next question comes from Claire Cao with Morgan Stanley. Please go ahead.

Hi. Thanks, management, for taking my questions. My first question is related to the CPM and ALO [ph] level in the fourth quarter. Can management give us a rough number? Thanks. And I have a follow up.

[Interpreted] Yeah. With regards to CPM and ALO [ph], our CPM in the fourth quarter was approximately RMB18, which grew 20% and our ALO [ph] was approximately 2.7%, which is up from 2.3% the prior quarter.

Okay. Thanks. My second question is related to the SME ads. I think it was mentioned like SME traditional channel revenue was up 91%, year over year, which was pretty strong. I'm just wondering what's the major driver behind this growth. What percentage is contributed by the increase in number of SMEs and what is contributed by the ASP increasing? Thanks.

Yes, so you're talking about our SMEs. We actually have two type of SME. I think you're referring to the one that's going through the channels. I think the driver -- we don't -- we're looking at the total SMEs, and we're seeing both a number of SMEs customers, as well as the ARPA, the spending per advertiser, increasing. I think what has allowed us to growth in the fourth quarter, as we talked about, historically the top-three sectors in SME are e-commerce, O2O, or app download. Going into the fourth quarter, we also have increased revenue coming from P2P finance. So I think that just -- part of the reason is the fact that we also diversify our customer set to include other sectors.

Okay, thanks. That's very helpful.

Thank you.

Thank you. Your next question comes from Juan Lin with 86 Research. Please go ahead.

Hi. Good morning, Herman and Gaofei. Thank you for taking my question. My question is related to the web native content. So I'm wondering, since Tencent just put out a RMB200 million subsidy to the web native content owners, I'm wondering whether Weibo will have a similar program this year to grow your native content, especially the vertical content. Thank you.

[Interpreted] Yeah. So our strategy to incentivize self-media bloggers are different than our peers, such as Baidu and Tencent. With their model, they would spend the money and make that investment to acquire the content. Our model is more a fans' economy, where we allow them to actually grow their fan base, and also allow the fan base to tip them. We give them different type of incentive mechanism, as we mentioned in our prepared call. In 2015, through tipping, through other various ways in which the self-media bloggers can monetize, we actually gave out a revenue share of RMB250 million, so that's approximately $40 million. So we believe that this system is better for Weibo to be able to have mechanisms on Weibo to motivate them to actually write more. So if we look at the China market, we'll see that some of our peers will actually go and buy content to incentivize self-media to write. But we believe that with Weibo and with Weixin because we're able to allow them to build their fan base and for them, the users, to actually pay for the content, that we believe this is a better way to do it. Rather than for us, as a platform, to purchase the content, we give them a mechanism where the self-media can actually collect monetization from the user itself. That way it will incentivize them to actually write content that will generate more revenue for them.

Thank you. Can I ask a second question, if I might? The second question is related to your video content. I'm wondering what percentage of your total traffic is generated from video content, and what are the main sources of your video content, and whether you are going to launch any new video products this year? Thank you. That's all my questions.

[Interpreted] Yeah. So, for feeds share to Weibo, on a daily basis, it's probably in the millions level. As a percentage of total feeds being shared on Weibo, it's still a very small percentage. So this is an area that we'll focus on this year, to actually grow more user-generated video content. So with regards to video source, we'll do two things. Number one is we'll look at those celebrities, media account, and also self-media accounts, who are already very successful on Weibo, to encourage them to send feeds in video formats. We'll also look at other key opinion leaders and influencers in China that's not currently on Weibo, and encourage them to come to Weibo to share the video content.

Thank you very much. That's very helpful.

Thank you.

Thank you. Your next question comes from Dick Wei with Credit Suisse. Please go ahead.

Hi, thanks for taking my question. This is Zen Zhao [ph] calling on behalf of Dick Wei. And can you give some color on the top-line outlook for the whole year in 2016? And another question. We see that there's $7 million loss in our non-operating income, in the impairment investments. Could you please specify on this item? Thanks.

Yeah. So the first question is our top-line outlook for the whole year. As you know, as a practice for Weibo, we don't give full-year guidance. We give revenue guidance for the year -- for the most recent quarter that's upcoming. With regards to the $7 million loss, so as you probably know, we have two Weibo funds. And we make investments in companies that we think would really help build Weibo's ecosystem. The $7 million relates to several companies. And we're required, on a quarterly basis, under U.S. GAAP to assess the impairment of our investments. So being this, in the quarter end, as we went through the whole process, we saw several companies that we felt that meets our accounting policy, in which we have to write down the cost that was on the books. Thank you.

Okay. Thank you.

Thank you. That concludes our question and answer session. I would now like to turn the conference back over to Ms. Chen, for any closing remarks.