Release Date: August 14, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Phoenix New Media Ltd (FENG, Financial) significantly reduced losses in the second quarter of 2024.
- The company enhanced its media influence through high-quality content and extensive online distribution.
- Phoenix Lab's original video service achieved a total of 1.7 billion views across platforms, with one video hitting over 1 million views on Bilibili.
- The company's Douyin account is approaching the 20 million follower milestone, contributing to double-digit growth in advertising revenue from third-party platforms.
- Phoenix New Media Ltd (FENG) maintained positive momentum in the commercial sector, expanding efforts in the public sector and achieving year-on-year growth.
Negative Points
- Total revenues decreased to RMB168.3 million from RMB180.2 million in the same period of last year.
- Net advertising revenues fell to RMB154.7 million from RMB161.8 million in the same period of last year.
- Paid services revenues dropped to RMB13.6 million from RMB18.4 million in the same period of last year.
- The overall Internet media spending experienced a year-over-year decline, impacting the company's advertising revenue.
- The automotive sector, traditionally a strong area for the company, saw a significant drop in ad spending.
Q & A Highlights
Q: The growth rate of the Internet advertising market seems to be slowing down. Could the management please share their views on the forward advertising market and discuss the relevant measures the company is planning on taking to respond to the current market environment, please?
A: (Xiaojing Lu, CFO) From the market data from the first half of 2024, the overall Internet media spending has experienced a year-over-year decline. Despite this, our advertising revenue for the first half of the year has remained stable with a slight increase. We saw significant growth in key areas like alcoholic beverages, FMCG, and the public sector. Looking ahead, our international marketing efforts look promising with the ongoing Paris Olympics. We are confident we can continue to grow in this area.
Q: Can you elaborate on the performance of your original content and its impact on your brand's advertising value?
A: (Yusheng Sun, CEO) Our original series, such as Eye of the Storm, delivered over 20 original articles with significant readership, earning praise for its commitment to objective and ethical journalism. Our original video service, Phoenix Lab, produced numerous videos that garnered wide distribution and discussion, enhancing our brand's advertising value. One long video became a hit on Bilibili with over 1 million views, and the series achieved a total of 1.7 billion views across platforms.
Q: What are the key areas of focus for Phoenix New Media in the second half of the year?
A: (Yusheng Sun, CEO) In the second half of the year, we will continue to work with full dedication to achieve our annual operating goals to reduce losses year over year. We will focus on strengthening our team's professional capabilities, producing quality content, refining our product, and optimizing user experience. Additionally, we will focus on further improving our operational efficiency and monetization capabilities.
Q: How has the company performed in terms of financial metrics in the second quarter of 2024?
A: (Xiaojing Lu, CFO) Our total revenues were RMB168.3 million compared to RMB180.2 million in the same period of last year. Net advertising revenues were RMB154.7 million, and paid services revenues were RMB13.6 million. Cost of revenues decreased by 17.2%, resulting in an increase in gross margin from 31% to 38.9%. Loss from operations was RMB8.9 million, a significant improvement compared to a loss of RMB35.7 million in the same period of last year.
Q: What is the business outlook for the third quarter of 2024?
A: (Xiaojing Lu, CFO) We are forecasting total revenues to be between RMB131.6 million and RMB166.6 million. For net advertising revenues, we are forecasting between RMB142.3 million and RMB152.3 million. For paid service revenues, we are forecasting between RMB9.3 million and RMB14.3 million. This forecast reflects our current and preliminary view, which are subject to change and substantial uncertainties.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
