iQIYI Q3 2025 Earnings Call - AI and Global Expansion Drive Content and Revenue Growth

Conference Operator: Thank you for standing by and welcome to the iQIYI Third Quarter twenty twenty five Earnings Conference Call. All participants are in a listen only mode. There will be a presentation followed by a question and answer session. I would now like to hand the conference over to Ms. Chang Yu.

Please go ahead.

Chang Yu, Investor Relations Representative, iQIYI: Thank you, operator. Hello, everyone, and thank you for joining iQIYI’s third quarter twenty twenty five earnings conference call. The company’s results were released earlier today and are available on the company’s Investor Relations website at ir.ite.com. On the call today are Mr. Lu Gong, our Founder, Director and CEO Mr.

Jun Wang, our CFO Mr. Xiaobui Wang, our CCO and Chief Content Officer Mr. Youqiao Duan, Senior Vice President of our Membership Business and Mr. Xiang Hai Yang, Senior Vice President of Movies and Overseas Business and Mr. Gang Wu, Senior Vice President of Brand Advertising Business.

Mr. Gong will give a brief overview of the company’s business operations and highlights, followed by Jun, who will go through the financials. After the prepared remarks, the management team will participate in the Q and 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 are 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. I will now pass on to Mr.

Gong. Please go ahead.

Lu Gong, Founder, Director and CEO, iQIYI: Hello, everyone. Thank you for joining us today. This summer, we captured the hearts of audiences with our original blockbuster drama, The Shuangwangwu. As we begin today’s earnings call, I would like to share the journey of bringing the compelling story to life. The Thriving Land became a highlight of iQIYI’s highly acclaimed masterpiece theater, Danyajuchang, a collection renowned for its expertly crafted adaptation of famous novels.

The Thriving Land tells a compelling tale of three families across two generations in rural China in the 1920s. When production began in Shandong last September, we heard questions and concerns: Can today’s audience be drawn to a story set one hundred years ago? However, we built this project with strong confidence, backed by our years of experience in adopting literature to hit dramas, A Lifelong Journey, Denshinjian, To the Wonder, Monotape and The North War, Beishang. It is our belief that great stories resonate universally. They transcend time, culture, age and age forging deep connections with viewers across regions and demographics.

This ability to tell time line stories is what sets long form content apart from faster paced, bite sized entertainment. As we all now know, the thriving land became a major hit, exceeding the 10,000 mark on IT popularity in DAX score and topping this year’s enlightened data chat for PIV Daily market share has influenced, expanded far beyond our platform, making meaningful impact on traditional TV and offline as well. It achieved the highest average rating per episode on CCTV’s drama channel and boosted tourism in its filming location, anchoring the offline success of The No Caught and To the Wonder. The success of the Thriving Land is a no con incident. It is built on iQIYI’s proven content methodology to create and amplify IP value through high quality storytelling and advanced production technology to connect with broad and diverse audiences and to develop our business model with IP at the core, From online to offline, from domestic markets to global audiences, our business model continues to evolve and scale.

Today, our online operations are well established. Global expansion is accelerating and our experience business is advancing accordingly. On top of that, we are embracing exciting opportunities enabled by a supportive regulatory environment and advancements in AI. These new regulatory policies lay a solid foundation for innovation and growth in the long form video industry. And at the same time, we leverage AI to transfer how content is created and consumed.

In July, we partnered with Google and Baidu and launched a global AI short film competition aimed at discovering and nurturing talents who create short videos using AI technologies. We also collaborated with academic award winning sigma photographer Mr. Peter Paul

Jun Wang, CFO, iQIYI: on a co branded AI theater featuring AI driven content.

Lu Gong, Founder, Director and CEO, iQIYI: We aim to leverage iQIYI’s professional production expertise to cultivate the next generation of greater innovative AI driven content production methods and deliver compelling AI powered storytelling that resonates with audiences. Now let’s dive into the details of our business performance in Q3. Starting with content, which is a cornerstone of our business. Our goal is to engage audiences with diverse, beloved content that drives commercial success. For long form dramas, we focused on top notch stories with high commercial value.

In the third quarter, we once again secured the top position in total viewership market share according to Enlighten Data. Our diverse high quality lineup included the nationwide hit, The Thriving ad and our in house custom detective series Corona Stereo Portia Wu, which emerged as summer’s dark house with an IT popularity in death score exceeding 10,000. Additionally, the science fiction series movies Bumianzhi earned strong acclaim for its innovative storytelling reaching a peak popularity score of over 8,800. Moving to movies. We achieved major performance in original theatrical releases.

The Shadow Edge grossed Bofengri grossed over RMB1.2 billion leading the Thunderbox office and making a historic achievement for us. On our online movie platform, we retained the top viewership market share for fifteen consecutive quarters driven by a diverse slate of 12 key titles. In Q2, we launched an innovative revenue sharing model to maximize returns for fields with limited box office opportunities. This strategy is gaining traction in Q3 with new titles like A Cool Fish two, Woman Shubert for Jitaai Line generating over RMB 17,000,000 in revenue sharing model in two months. For variety shows, our focus on top tier titles delivered strong results in both popularity and revenue.

The team of stand up comedy season two, Xiji Zhuang Zan Kou Pi, our flagship IP generated impressive membership and advertising revenues. It achieved iQIYI popularity index of over 8,000 and dominated genres with a leading market share according to enlightened data. Additionally, our newly launched observation show, Her Prime, Jete Lan Jia, sparked widespread discussions To deepen audience engagement and elevate our variety show IP value, we introduced consumer products like collectible cards and co branded merchandise collections resulting a stronger audience loyalty. Turning to micro dramas. They continue to enhance our content ecosystem achieving double digit sequential growth in average daily viewing time and the daily subscription revenue in the third quarter.

Our micro dramas also have attracted sponsorship from brand advertisers

Jun Wang, CFO, iQIYI: with

Lu Gong, Founder, Director and CEO, iQIYI: more partnerships anticipated in the future. This growth has been driven by our focus on premium content, enhanced original production capabilities and an expanded library of free titles. Our micro drama content library now includes over 20,000 titles with over half available for free. We have also established our strong capabilities for consistently releasing original micro dramas. Hits such as Feet of Three Lives, Yuanqi Fansheng, Nurturing the Night, Su You He Se, and Immoral Paradise, Bin Shi Le Hintang, resonated strongly with audiences.

Additionally, we introduced a dedicated micro animation channel Manju and kicked off for original production. Micro animation is an innovative format of short form animation that has experienced rapid growth in the past year following the success of microdrama and heavily leveraging AI technology. For animations, we continue to improve our original production capabilities. In the third quarter, over the Dubai films, Shenguo Zishan continued to enjoy strong viewership. Additionally, our highly regarded original production Love Between Failure and Devil, Tangentue returned with a second season, captivating loyal audience and driving high engagement.

Next, let me show our effective slate of content for the first quarter. The diverse customer pipeline increased Fitted Cars, Yixiao Zuiguo, Sword and Bitlove, Kenpi Jianxin, Silent Honor, Chenmo de Rong Jiang, Dan An, Shuun Yigong, A Strange Tale of Tang Dynasty Three to Chang’an, Tangtao Gui Shuo Zhu Chang’an, Legend of the Magnet, Social Media, Speed and Love, Shuang Zhui and Silent Path, Feng Yuchao. The movie pipeline includes our original theatrical film Skin PNAM, for theatrical release and our original theatrical Hit the Shadow’s Edge for online streaming. The first batch of original animated films under the emerging film projects, and the licensed films such as Dive to Rise, The Legend of Hei Tu, The Original Variety Show includes flagship IP Blooming Journey two, Heilou Fanhua, Hi, Young Farmers, and the brand new IP Wonder Together, The macro drama pipeline includes the first macro drama based on the highly popular IP, Strange Tale of Tang Dynasty titled Tang Dynasty Mysterious: The Horizon Conspiracy, Tang, Qi Han, Xueqiang, Xianwei, as well as For Seeing You in My Final Days, Samuel Yuzhenyi and Saint Marked Destiny, Xiaohu. The animation and children’s content includes new animation Ascendant of the Night Song, Jiuyang, Wuxuan, Returning Cartoon, Dao Squad Season four and a new IP, Payment and the First Food Truck.

Moving on to membership services, we aim to build our household name membership brand with brand market appeal backed by our vibrant content ecosystem and exceptional services. Membership services revenue recorded sequential growth in Q3, driven mainly by original hit dramas like The Thriving Land and Corona’s Diarrhea as well as theatrical megahit Noja2. Beyond content, we are increasing our efforts to enhance membership services and deliver unmatched value. Our family oriented entertainment plan stands out with exclusive perks like express packages offering early access to show the values, a proven driver of new subscriptions and upgrades to this premium tier. The Accountancy Experience program in Immortal continues to boost engagement with meaningful revenue growth year over year.

We have created stronger synergy between membership and advertising revenues by introducing branded groups within the program. We are also integrating membership experience with top IPs. This quarter we launched IP themed membership cards for No Chat Who and The Journey of Legend, Journey of Legend, Fu Shanghai, giving fans a deeper connection to their favorite story and characters. Connecting with our audience is at the heart of what we do, our annual flagship July 17 iQIYI membership festival has become a signature fan appreciation event loaded with exclusive perks and irresistible subscription offers. We also strengthened membership value and loyalty through over 10 VIP only gatherings, ranging from online meetups to advanced screenings.

We have elevated membership performance by focusing on operational optimization aiming to boost membership value and encourage subscribers to stay with our service longer. This includes initiatives to promote longer term plans and targeted promotions for specific audiences. Additionally, we expanded our bundled membership partnership to 16 brands while broadening our sales channel across e commerce and telecom platforms. Moving on to advertising business. In the third quarter, brand ads recorded double digit annual growth mainly driven by premium variety show like The King of Stand Up Comedy Season two and hit dramas like The Journey of Legend and The Throwing Land.

Our content related ad solutions continue to gain traction, contributing over 60% of brand ad revenue. Key verticals such as food and beverage, Internet services and e commerce, beauty and personal health all showed robust annual growth. We use AI to drive production innovation and advertising efficiency with features like creative bulleted charts and AI generated ad materials including animation style mid show for innovative marketing solutions. As we entered Q4, we aim to capitalize on major advertising opportunities such as Double eleven shopping festival, Christmas and New Year campaign and the new smartphone launches. Our focus will be on maximizing ad sales from premium variety shows, dramas and our drama center brands while further enhancing monetization on smart TVs.

We will continue leveraging AI to improve brand advertising efficiency. For performance ads, we now have a healthier and more balanced advertiser portfolio with revenue dependent on committed individual client. By industry, Internet services and education and training will send out contributors this quarter. Looking ahead, we will focus on capturing new budgets in the Internet services sector, including tools, social platforms and mini games, while scaling up revenue in education and training, wellness management and e commerce. Additionally, we plan to expand our performance and inventory and utilize AI to further enhance monetization efficiency.

Moving on to technology and products, we continue to harness cutting edge technologies to transform the entertainment experience, improve content production efficiency and boost content value across our platform. On the content creation front, we are leveraging AI to transform storytelling. A notable example is our partnership with academic award winning Mr. Peter Pao. Together we will launch the Peter Pao IT AI Center to pioneer the next generation of AI driven storytelling talent development.

The first titles are sent to Premium Soon, which we are very excited for. Additionally, we are using AI to produce high quality original micro animation at much lower cost. Another unique example is the AI part, iQuickRule Connection, Sukhan, which now cover all major content categories. These features utilized a smart editing agent to automatically convert long form videos into vertical shots, which are then included in iCookReal collections. ICrypt Reel collections offer users a real experience akin to that of micro dramas.

We are transforming user engagement with Taozou, an AI powered personnel assistant that provides personalized support including video search recommendations and plot insights. The latest update improved recommendation for macro dramas and short form videos alongside long form content while also enhancing plot Q and A capabilities. Additionally, we introduced Binge watching rankings allowing users to track time spent on their favorite series and view their rankings. This feature has received highly positive feedback from fans. In addition to announcing AI applications, we are driving the industrialization of video production with cutting edge virtual production technology.

Our global virtual production capabilities now support both in house and external projects. This quarter we launched an omni directional motion simulating vehicle rig filming platform powered by our in house developed IQ stage water production system, the platform naturally enhances efficiency of high frequency vehicle scene shots. It delivers streamlined repeatable workflow and has already been utilized for virtual production in major theatrical productions. Moving on to business performance in regions outside of Mainland China. We maintained strong growth momentum in Q3 with membership revenue increased by over 40% annually.

Markets like Brazil, five Spanish speaking regions, Mexico and Indonesia had membership revenue more than doubled year over year. In this quarter, the average daily subscribers also reached an all time high. The strong performance is supported by an exceptional content lineup Our C drama, Chinese drama, continues to gain popularity globally with revenues growing double digit both annually and sequentially, notably. The tied up version of Corona Stereo set platform records for both viewing time and peak revenue within its language segment. It also topped IT popularity charts in 13 overseas markets.

Meanwhile, our local content slate also exceeded Kim Jongro, The Serious, LingHuun Chong Sheng emerged as a phenomenon in Thai language content this year generating the highest membership revenue among all Thai dramas on our platform and token related rankings on Google and Twitter. Beyond long form content, micro dramas continue to build strong momentum overseas. Membership revenue from micro dramas grew 114% sequentially by the September. Micro dramas ranked second only to long form dramas across several core metrics including membership revenue and viewing time. Moreover, multiple iQIYI original micro drama gained solid traction abroad.

For example, How Dare You, Changde Heaton, has shown a strong long tail effect three months post launch. We are also expanding into locally produced musical dramas. Multiple projects in English, Thai, Korean and Indonesian are in production and are targeted for launch this year. Looking ahead, we will continue to deliver high quality content to international audiences, deepen partnership with telecom operators and local partners and leverage AI to drive user acquisition. Moving on to experience business.

Well, we are focusing on two key areas IP based consumer products and offline experiences. We are leveraging our extensive and unique IP to build a more robust entertainment ecosystem. For IP based consumer products, we have upgraded our business model from live a licensing only approach to a dual track strategy combining self operated merchandise with licensing. Q3 growth was strong with revenue from IP based consumer products more than doubling year over year. In particular, revenue from self oriented merchandise grew more than 70% sequentially driven mainly by collectible cars from top drama titles, meanwhile.

Our self operated portfolio has expanded beyond collectible cars into additional categories supported by the establishment of in house teams. For IP licensing, the hit drama The Journey of Legend has partnered with over 30 licensees setting a new record while expanding multiple sectors including e commerce, FMCG and beauty. In our offline experience business, we are pioneers in this emerging field. At the heart of these initiatives are Iqiyi Labs, which are designed to operate under an asset light model. Our two locations, Yangzhou and Caifeng, are under development with Yangzhou IT land scheduled to open early next year.

A third site in Beijing has also been announced. By integrating technologies like AI and XR with our content IP IT land, we will provide interactive and scalable experiences that are faster to iterate and more efficient than traditional theme parks. This approach reduces space and capital requirements with revenue expected to come mainly from ticket sales and other on-site spending. As 2025 drove to a close, we reflect on a year of rapid transformation driven by technical innovation and evolving business models. We are not merely adapting, we are advancing fueled by our thriving overseas expansion, growing experience business and ongoing AI investments.

Breakthroughs in any of these areas could elevate us to a new heights. Amid this change, our core remains the same, creating premium content IP supported by a proven commercial model. This foundation earns us the royalty of hundreds of millions of users under the trust of industry partners. Moving forward, We will continue delivering quality content, fostering creativity with partners and driving long term value for shareholders. Now let me hand it over to Jun for the financials.

Jun Wang, CFO, iQIYI: Thank you, Mr. Gong, and hello, everyone. Now let me walk you through the key numbers for the third quarter. The total revenue for the third quarter were RMB6.7 billion, up 1% sequentially. The membership services revenue reached RMB4.2 billion, up 3% sequentially, driven mainly by our little blockbuster drama and theatrical mega hits Neulja two during the summer season.

The online advertising revenue was RMB1.2 billion, decreased by 2% sequentially as the performance in the second quarter benefited from the major advertising campaigns. The content distribution revenue reached RMB644.5 million, up 48% sequentially. The increase was mainly driven by the strong distribution performance of the original theatrical movie invested by iQIYI, along with the growth in transactions for dramas. Other revenues were RMB $585,000,000, down 29% sequentially. Moving on to costs and expenses.

Accounting cost was RMB4 billion, up 7% sequentially as we launched a more diverse selection of premium content during the peak summer season. The total operating expenses were RMB1.3 billion, down three percent sequentially, benefited from our disciplined expense management. Now turning to profit and the cash balances. The non GAAP operating loss was RMB21.9 million. Non GAAP operating loss margin was 0.3%.

As of the end of third quarter, we had cash, cash equivalents, restricted cash, short term investments and long term restricted cash, including the prepayment and other assets, a total of RMB4.9 billion. At quarter end, the company had a loan of $522,500,000 to PAG recorded under amounts due from related parties. For more detailed financial data, please refer to our press release on our IR website. Now we will open the floor for Q and A.

Conference Operator: Thank Your first question comes from Zhiking Zheng from CICC. Please go ahead.

Chang Yu, Investor Relations Representative, iQIYI: Management for taking my question. It has been three months since the new regulations issued. So can management provide an update on the progress? Thank you. Thank you, Xu Jin.

We’ll invite our Chief Content Officer, Mr. Xiaohui to answer this question. The core objective of the new policies is to promote the healthy development of the long form video industry. In the past two months since its implementation, we have observed positive programs in several areas, including the concurrent review of key dramas at the National and Provisional Administration as well as the exploration of concurrent review of broadcasting for new content formats, such as anthology drama, multi season drama, multi art drama and sitcoms as well as the optimization of co review Under the new policy environment, we are actively innovating content production and broadcasting models. For example, we’re exploring a brand new content format called Online Feature Series and integrating it into our existing emerging film project collaboration framework.

Going through a revenue sharing model with our partners, we aim to attract more creative talent and high quality content, strongly driving innovation and also growth in the industry. Based on the current progress of implementation, it is clear that the new policies have sent positive signals to the industry. Some of our projects have already benefited by the policy support, allowing them to reach a ready to broadcast status more quickly. As productions proceed smoothly in the future, we will gradually see the broad benefits of the policies take shape. In the long term, the policies will drive the industry into a more a new growth place, benefiting professionals across the board.

Thank you.

Conference Operator: Thank you. Your next question comes from Vicki Wei from Citi. Please go ahead. Management for taking my questions. Will management share some color about your outlook about the membership business?

Thank you.

Chang Yu, Investor Relations Representative, iQIYI: Thanks, Vicki. I will invite our Senior Vice President of Liu Xiaodong to take this question. Since the September, our membership business has shown nice growth momentum, driven by three main factors: first, the continued release of high quality content second, the ongoing enhancement of member services and benefits and third, the optimization of marketing and sales strategy such as expanding bundled memberships and offering targeted discounts for teachers and students. The Silent Honor which was released at the September broke the demographic boundaries and captured the hearts of young audiences. Our female oriented content such as Faded Hearts and Sword and Beloved along with the suspense theater titles like The Hunt and The Dead End also gained wide popularity.

The recently released Strange Tales of the Tang Dynasty three to Chang’an, which is the third drama of the Strange Tales of the Tang Dynasty IP series, received widespread acclaim shortly after its premiere with its popularity index on the iQIYI surpassing 10,000. It became the second drama in the series to hit this milestone making the Strange Tales of the Tang Dynasty, iQIYI’s first IP series to have two seasons exceeding the 10,000 popularity mark. The latest release in the series, while building on the classic elements introduce more innovative content showcasing the strength of high quality IP series development and also successfully attracting and retaining a loyal audience base. At the same time, we have enhanced membership value and perception of benefits through more refined operations. For example, offering more diverse subscription options, offering member only IP merchandise and also offline events tailored for premium members.

We’re confident in achieving sustainable growth in our membership business with the support of high quality content and enhanced member benefits and services. Thank you.

Conference Operator: Thank you. Your next question comes from Felix Liu from UBS. Please go ahead.

Chang Yu, Investor Relations Representative, iQIYI: Thank you management for taking my question. We noticed that Chinese culture industries have made good progress in the overseas markets lately. Can management share more progress on your overseas expansion and strategy? Thank you. Thanks, Philip.

We’ll invite our Senior Vice President of our Overseas Business, Mr. Shanghai Yang, to take this question. Please. Our overseas business has strong performance this year with Q3 total revenue and membership revenue achieving the highest annual sequential growth in the past two years. We see the Chinese content serves as the cornerstone of our overseas content portfolio and iQIYI has become the top choice for an increasing number of overseas users to watch Chinese language content.

We continue to promote Chinese language content across various markets and have seen a significant increase in influence in major overseas markets, which is effectively driving the growth in user base and also the membership of members. In terms of local content, we have engaged in both licensing and original productions in Thailand, Malaysia, Indonesia and Taiwan. Among these, Thailand has been our most successful market. This year, we launched several hit titles such as the Thai drama, The Series, which set new records on our overseas platform in terms of both viewing hours and revenue for Thai content. With subtitles added, our original Thai dramas have been distributed in other markets and revenue from our original Thai dramas in The U.

S. And other overseas markets has already surpassed that of Thailand’s domestic market. We are pleased to see that Thai dramas have become the second globally recognized content category after C dramas. And looking ahead, we plan to increase the perception of original Thai, Malaysian and Indonesian dramas. At the beginning of the year, we mentioned that some of the newly developed markets such as The Middle East, Spanish speaking regions in Latin America and Brazil regions.

And these regions have maintained rapid growth actually throughout the year with significant increases in membership revenue and subscriber numbers. In the future, we will continue to deliver high quality content while leveraging AI technology to enhance content production and promotional efficiency. And currently, over 70% of promotional materials for our overseas content are generated using AI, which is significantly boosting our market efficiency. Thank you.

Conference Operator: Thank you. Your next question comes from Gigi Zhao from Guangfa Securities. Please go ahead.

Chang Yu, Investor Relations Representative, iQIYI: I will translate the question myself. The application of AI in the global film and television industry has been advancing increasing depth to management share, strategic insights and future plans pertaining to AI adoption, content production and business layout? Thank you. You. We’ll have our CEO, Yusuf Yu Gong to take this question.

Okay. For I think for the AI technology, it provides a very opportunity outlook for ITE. To take analogy, for example, in the past twenty years, actually, the Internet actually provided on the video industry an opportunity and advantage to surpass traditional linear TV. And we think currently with the large language models for AI actually provides a similar opportunity outlook for In the past few years, actually, AI technology have deeply integrated in our operations and helping us to achieve goals in three key areas. The first one is to increase our operational efficiency.

We use AI for marketing materials, for example, automatically to generate posters and also promoting promotional marketing materials. And also we use that for overseas content translation, while the cost is much cheaper compared to the human labor side and also faster. The second point is AI actually boosts monetization capabilities as it can efficiently produce advertising creative materials and we can use that to optimize our business algorithms, which help us to improve the targeting accuracy and also conversion rate. The third point is AI can empower us to for content production. Actually, we use AI as support for our internal production capabilities.

For example, we have a screenplay workshop in iQIYI. We use that to significantly enhance the evaluation and also the creation of capabilities for novels and scripts. And also, we have an inmate workshop feature, which can effectively support early stage creative development, for example, by providing concept posters and also storyboard generations and character design. And the fourth point is we actually use AI to build out some basic user features. For example, based on the AI we’ve rolled out at Taobao World, Taobao and also iJob’s features.

All of these will improve the viewing experiences. Above mentioned the four points earlier, actually once we already used in our daily operation, we’ll keep refining them and upgrading them. Hopefully, it will bring more benefits. And now and then going forward, we’ll focus on three major areas. The first one is the IT’s intelligent production system, which actually was previously reserved for internal use and we will going forward gradually open up its core functions for our close partners.

So helping them to leverage AI to enhance their production capabilities. And third point is we will continue to promote on the promoting using AI in the market and also for the industry. For example, we launched initiatives such as the AI short film creation competition, as I mentioned earlier in the opening remarks, and also partnering up with Academy winners, Peter Tao, to build out the AI theater. I think the main purpose for these initiatives are to discover and nurture AITC creative talent through collaborations and also market promotions. The purpose is to foster an innovative driven content going forward.

And last but not least, our focus will be collaborating with our partners and also utilizing our current AI technologies to explore more on a large scale application of AIGC in areas, for example, like micro animations, animations, educational content, documentary, etcetera. And hopefully, these AI will become a core engine of content creation. And this is the first stage. And going forward, the bigger picture will be utilized AIGC to apply them in our long form video content, for example, dramas, for example, films. So we’re estimating in probably in the next one to two years, that’s on the slower side or maybe three years, but we think overall speaking, no more than five years.

AI will bring dramatic change to our Internet space and also to the video content creation industry. So going forward and also currently, we have been investing heavily in AIGC and also AI technology applications, and this is one of the amount of core area of investment for the company right now. So hopefully, going forward, we can utilize AI to do more creative content and also to change content ecosystem. Thank you.

Conference Operator: Thank you. That concludes our question and answer session. I’ll now hand back to management for closing remarks.

Chang Yu, Investor Relations Representative, iQIYI: Thank you, everyone, for participating in the call today. And if you have further questions, do not hesitate to contact us. See you next quarter. Thank you.

Lu Gong, Founder, Director and CEO, iQIYI: Thank you. Bye bye.

Conference Operator: Thank you. That does conclude our conference for today. Thank you for participating. You may now disconnect.