Cheetah Mobile Q4 2025 Earnings Call - Non-GAAP Profitability Achieved as AI and Robotics Take Half the Revenue

Unknown, Moderator/IR Representative, Cheetah Mobile: Thank you, operator. Welcome to Cheetah Mobile’s fourth quarter 2025 earnings conference call. With us today are our company’s Chairman and CEO, Mr. Fu Sheng, and our company’s Director and CFO, Mr. Thomas Jintao Ren. Following management’s prepared remarks, we will conduct the Q&A section. Please note that the management’s prepared remarks are presented by AI agent. Before we begin, I refer you to the safe harbor statements in our earnings release, which also applies to our conference call today as we will make forward-looking statements. At this time, I would now like to turn the conference call over to our Chairman and CEO, Mr. Fu Sheng. Please go ahead, Fu Sheng.

Fu Sheng, Chairman and CEO, Cheetah Mobile: Good evening, everyone. Thank you for joining us. In 2025, we finished stabilizing the business and built a stronger foundation for Cheetah Mobile. During the year, our total revenue grew 43% year-over-year, driven by continued growth in both our internet business and AI and other segments. In the fourth quarter, AI and others already accounted for half of total revenues, reflecting the increasing contribution of our new growth initiatives. More importantly, we achieved full year non-GAAP operating profitability, our first time in six years. Our internet business remained resilient in 2025, generating approximately RMB 460 thousand in adjusted operating profit every working day. This consistent operating cash flow forms the financial backbone of the company and allows us to invest in robotics and AI in a disciplined and sustainable way.

Our second highlight is robotics, which is emerging as a key structural growth driver. For full year, robotics revenue grew approximately 31%. In the fourth quarter alone, robotics revenue reached about RMB 60 million, up 94% year over year and 43% quarter over quarter. Our voice robots in China achieved 100% year-over-year growth for three consecutive quarters, accounting for high single digits of the fourth quarter’s total revenues. This progress is driven by our strategic focus on core strength in voice robotics and the integration of AI agent technology to enhance product experience. We are now seeing our voice robots become a must-have solution in reception, guided tours, retail environments, hospitals, and service halls as they deliver proven measurable value.

We recently introduced a new version of our voice robot, which comes with built-in skills like guiding, patrolling, and advertising, enabling end customers to start using them right away. Our robotic arm business, mainly serving overseas markets, is making up high single digits of the fourth quarter’s total revenues. We focused on long-tail demand from research institutions and the R&D teams that value openness and customization. This customer base is sticky and repeatable, supporting long-term demand. Building on our proven indoor autonomous mobility technologies, we are introducing a smart wheelchair targeting developed regions such as Western Europe and North America. This product is positioned as a premium solution for users who value safety, independence, and confidence in daily mobility. We are seeing a clear shift in demand as users increasingly value safety, assistance, and intelligent features in mobility products, while scalable solutions in the market remain limited.

By applying our experience in service robots, we are able to meaningfully improve the user experience. During my own recent recovery, I personally used our smart wheelchair and felt a clear improvement in safety and convenience. Importantly, we can deliver these benefits without significantly increasing the cost compared to traditional high-end electric wheelchairs, making this a more practical and accessible product for users. We have entered into framework agreements with established mobility brands who will manage branding, distribution, and after-sales services. Initial shipments are expected to begin in the second quarter of 2026, representing an early-stage commercial validation of this product category. Across the industry, more companies are starting to test and deploy service robots. We believe the next 1-2 years will be a validation phase where ROI and reliability will matter most. You don’t need a robot that looks like a human.

You need a robot that works every day, delivers measurable value, and is easy to operate at scale. This is exactly where our current products are positioned. Our internet business remains strong, generating steady cash flow, which allows us to invest in AI in a disciplined and sustainable way. For more than a decade, we have built utility applications serving hundreds of millions of users. This product’s DNA shapes how we approach AI. Rather than competing in model development, we focus on turning AI capabilities into practical tools that help users complete real tasks. During the Chinese New Year, I spent lots of efforts experimenting with an AI agent system built on the OpenClaw framework. Starting from a single agent that could barely complete basic tasks, the system evolved into a multi-agent team capable of running tasks continuously.

The system generated personalized New Year messages for more than 600 colleagues and managed the entire sending workflow automatically. What we see emerging is not simply a new AI tool, but a new way to organize digital work. AI agents can automate entire workflows, from information gathering to processing and distribution, significantly improving productivity. Building on these learnings, we introduced EasyClaw, based on OpenClaw, an open source agent framework for both domestic and overseas markets. EasyClaw is our AI coworker platform that helps users create and deploy task-oriented AI agents capable of executing real-world tasks autonomously. At this stage, we focused on execution capability rather than scale. We are already seeing a continued increase in user engagement, as reflected in the rapid growth of our total token usage. We are building EasyClaw into an agentic operating system that changes how users interact with software and machines.

By integrating EasyClaw into our PC products, we are improving user experience and driving higher conversion and ARPU. In robotics, EasyClaw allows users to program and customize robots using natural language, lowering customization barriers. This helps us deploy faster, reduce costs, and scale more easily, making our products more competitive. Some investors may ask how we compete without training foundation models. We believe the real advantage in the agent era lies not in the model itself, but in the systems built on top of it, including task orchestration, tool usage, and cost management. By leveraging open ecosystems and leading APIs, our products can evolve as models continue to improve. Finally, our global DNA remains a core competitive advantage. We’re continuing to expand both our AI tools and robotics businesses internationally with a disciplined approach.

Looking ahead to 2026, we do not provide specific financial guidance, but we see continued structural improvements. We believe our robotics business will maintain strong growth momentum as commercial validation deepens and becomes a more important part of our revenue mix. At the same time, AI-enabled products will gradually enhance engagement and monetization efficiency across our software ecosystem. We will increasingly apply AI internally to accelerate development, aiming to further improve operational efficiency. As we grow, we will continue improving transparency and disclosure. Credibility is built through data and our focus remains clear. Execute with discipline and let results compound over time. Cheetah is entering its next phase of development, combining digital coworkers through AI agents and physical coworkers through service robots, supported by real operating cash flow and disciplined financial management. We are building the foundation for our next stage of growth. Thank you.

Thomas Jintao Ren, Director and CFO, Cheetah Mobile: Thank you, Sheng. Hello, everyone, and thank you for tuning in. Unless otherwise stated, all financial figures are presented in RMB. 2025 marked a year of meaningful operational recovery and improved financial discipline for Cheetah Mobile. During the year, we continued improving operating discipline and cost structure across the company. We concentrated resources on commercially validated use cases in robotic products and practical AI applications while leveraging open source ecosystems and third-party models to improve R&D efficiency and optimize infrastructure costs. This approach allows us to accelerate iteration without significantly increasing fixed costs. For the full year 2025, total revenue grew approximately 48% year-over-year to RMB 1,150 million. Although we recorded a GAAP operating loss of RMB 179 million for the year, this represented a substantial improvement compared with operating loss of RMB 437 million in 2024.

On a non-GAAP basis, operating profits reached RMB 14 million, compared with a non-GAAP operating loss of RMB 232 million in the prior year, reflecting improved operating leverage. We ended the year with $215 million cash and cash equivalents on hand. Turning to our segment performance, our internet business continued to serve as a stable cash-generating platform for the company in 2025. Revenue from the internet business increased 19% year-over-year to RMB 615 million. Within internet revenues, internet value-added services revenue increased 21% year-over-year in 2025, contributing 65% of segment revenue, supported by both paying user growth and ARPU expansion. In addition, we observed that many users subscribed for periods longer than 12 months, reflecting the recurring nature of our utility applications and strengthening revenue visibility.

In terms of profitability, the internet business generated approximately CNY 115 million in adjusted operating profit in 2025, maintaining healthy margins and strong operating cash flows. As Michelle mentioned earlier, the internet business generates roughly CNY 460,000 in adjusted operating profit per working day, which provides predictable cash flow to support strategic investments in new initiatives. Looking ahead, we expect the internet business to remain stable and profitable while continuing to provide financial flexibility for the company to invest in long-term growth opportunities. Turning to our AI and other segments, revenue from this segment increased 85% year-over-year to 535 million in 2025. As a result, this segment accounted for 46.5% of total revenue, compared with 35.9% in 2024, reflecting the growing contribution from our emerging businesses.

Within this segment, the robotics business continued to scale since the second half of 2025, making up 27% of this segment’s revenue and 13% of total revenue in 2025. Robotics revenue increased 31% in 2025, driven by deployments of voice robots in China and continued demand for robotic arms in overseas markets. Other businesses, namely overseas advertising agency service and multi-cloud management platform within this segment, also contributed significantly to revenue growth, benefiting from increasing overseas expansion by Chinese enterprises. At the same time, we continued to improve operating efficiency through more selective investment and disciplined cost control. For the full year, adjusted operating loss from the AI and other segments reduced by 42% year-over-year to CNY 274 million as we continue scaling the business while maintaining disciplined investments. Turning briefly to the first quarter performance.

Total revenue reached RMB 309 million, representing a 30% year-over-year increase and a 7% quarter-over-quarter increase. While Internet revenue declined slightly year-over-year in the fourth quarter, it increased quarter-over-quarter as we continue the shifting toward a subscription driven business model. In addition, user subscription revenue within the Internet segment increased 32% year-over-year and 16% quarter-over-quarter as we chose to focus on subscription business model, which supports a healthier product and user experience. Revenue from the AI and other segments reached RMB 153 million, accounting for nearly half of total revenue in the quarter. Within segments, Robotics revenues increased by 94% year-over-year and 43% quarter-over-quarter to about 19% of the fourth quarter’s total revenue.

Other than that, our revenues from overseas advertising agency service and multi-cloud management platform also contributed to this segment’s year-over-year growth. On a non-GAAP basis, the company generated operating profits of RMB 15 million in the fourth quarter, compared to RMB 42 million operating losses in the same period last year. We believe the improvements we achieved in 2025 reflected structural improvement in both our cost structure and revenue mix. Looking ahead, our priorities remain clear. Disciplined growth, continued improvements in operating efficiency, balanced and disciplined capital allocation. With stronger financial discipline, clearer strategic focus, and increasing contribution from our emerging businesses, we believe the company is entering a more stable and predictable operating phase. Thank you. We are now ready to take your questions.

Unknown, Operator/Q&A Facilitator, Conference Call Operator: We will now begin the question and answer session. To ask a question, you may press star then one on your touch tone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. At this time, we will pause momentarily to assemble our roster. Ladies and gentlemen, please stand by for the English translation of the Q&A session. Please note that there may be a delay before the translation begins. There may also be a delay in between questions. Please do not disconnect.

AI agent, I would like to ask, what core workflows has the company accumulated in the process of promoting landing data or customer scenarios? Has this phase been converted into a barrier for our product? In the context of the big wave of large companies accelerating into the AI scene, does the company think its core differentiation is reflected in the medium and long term? How should the management position itself? What is the role of AI agent startups? Thank you.

Thomas Jintao Ren, Director and CFO, Cheetah Mobile: Okay. Thank you. Thank you for your question. Good question. Let me answer it. I think.

Fu Sheng, Chairman and CEO, Cheetah Mobile: Our AI agent in 2025, we have started to make a pilot. We have always believed that not only large model companies, but also application companies have opportunities in this way. In 2025, we launched this Vitality LLM, which is a desktop agent. After OpenCloud launch, it had some advantage in architecture design. We also quickly learned from it and launched our own cloud. We are one of the first domestic companies to launch OpenCloud-related products. I think the concept of OpenCloud has gained popularity in China after the Spring Festival. Although we started at the end of last year and have launched such products, we now have our own user base. This user base has shown strong user scenario demands. Which workflows were you asking about?

It’s not easy to go into detail, but today I think in the EasyCloud scenario, we have targeted user demand to develop some skills which are very uncommon more than competitive advantage. Frankly speaking, I think it’s not a barrier now, but we definitely have our own unique features in this regard. As big companies are accelerating to enter this field, I think AIGC is a very broad field. Essentially reconstructing the entire software and app industry. When big companies enter, they will gain recognition from a wide range of users. Our differentiating strategy is to combine Cheetah Mobile’s existing AIGC R&D capabilities of top tools and its emphasis on user experience details, as well as features like multi-cloud aggregation and many high-quality partnerships with cloud vendors, both domestic and international, in our global expansion, namely our global advertising business, where we’ve accumulated many ToB user groups.

Therefore, our core differentiated advantages are reflected in true vertical industry solutions, which is EasyCloud that we hope to offer to users. Not just a tool that can connect to LLMs, but also an agent that can run on users’ desktops, also truly targeting vertical user scenarios, especially ToB user scenarios, and present an easy-to-use solution. We are constantly advancing in productization. Although it’s not yet March, we have already done a lot of survey scenario exploration in this regard. In the medium and long term, we and the big companies, because we have repeatedly discussed internally, we think our advantage over the big companies is that we should be able to better target the needs of the vertical scenario to make products that are closer to users. In the medium and long term, we positioned EasyCloud on AI agents.

I agree with the judgment of Peter, the founder of OpenCloud, that 80% of apps will disappear in the future. OpenCloud will become a very important carrier for the agent. Whether it’s called OpenCloud or EagleEye, or recently, Apple has also launched their mobile version of Claude Code. This kind of product form should be a very cool one. Now Cheetah is all centered around EagleEye, whether it’s our 2C user group, 2B customer group, or our robot business. We are at EagleEye landing. It’ll be a very important strategic product. It’s not like what some social media says that we seize the opportunity well. After years of tool development, we have a better judgment of the industry, including that we started in advance, and we will stick to it for a long time. Thank you.

Unknown, Operator/Q&A Facilitator, Conference Call Operator: Okay, thank you. Operator, can we move to the next question?

The next question from Nancy Liu with J.P. Morgan. Please go ahead.

Hey, thanks to management for answering my question. I have an industry-level question. I’d like to know management’s opinion on the sustainable economic value, where it is more likely to be concentrated in the end, whether it is public cloud and computing platforms or basic model vendor or applications and workflows closer to users than further in our company. EagleEye is currently positioned at the application layer. In practice, does the company have the ability to gradually master the task scheduling and user entry, thus enhancing our position in the value chain? Or from the perspective of industry evolution, black holes with traffic entry are more likely to occupy a core position like ABC, which is likely to be embedded in the super platform ecosystem as a functional module. What is management’s view on the evolution path of this industry pattern?

Fu Sheng, Chairman and CEO, Cheetah Mobile: Thank you for your question. I think the evolution path in this industry pattern may be very cool for everyone in this industry today. After all, the development needs of AI and the degree of fierce competition are unprecedented. However, I still have a few judgments. First, I think the first question today, which layer will be more urgent today? Where will the economic value today be concentrated? I think for quite a long time, maybe in 3-5 years, whether it is public cloud computing platform or basic model vendor, or the one closer to the user side, there will be a place. This is in the near future.

For the next three years, it will definitely exist because today you can see that the competition for models is also very fierce, and the models also show this diversity, like the top models in the United States, which have a high call rate. Now due to the strong demand, the call rate of many domestic models has also risen very quickly, and they are actually suitable for different tasks. Therefore, the competition models for different tasks will continue for a long time. In this process, which application can bring better experience to users and entry, it will also form more cooperative relationships with the model. In fact, I think in this layer, I have a judgment. That is, I think in the future application layer, it will be difficult for any one company to completely control the monopolistic entry.

For a rather long period of time, there will be a situation where different industries and user groups have different product positioning. As I mentioned in the previous question, our main target users today will be more to be even in the overseas customer group, which is not a tech leading company, but a traditional company far from tech will be a key focus for us. We believe that in this user group, we have the opportunity to take the lead. For example, the impact on the industry you ask today, IM or traffic entry attributes are easy to occupy a core position, but it is more from the perspective of a wider user. As I just said, today you can see the user layering of products like this is very obvious. The difference between users who pay less and more, the difference in their demand attributes is huge.

Although it is a product, the overall user demand attributes and its usage characteristics are very different. I think this kind of product for the general public in terms of the user demand, it is not easy to meet in a considerable long stage because we have to take into account both implementation and permissions, as well as user cultivation and education and token costs. We still think that if we fight this battle well, we can occupy some vertical users like us. If there is one more thing about users, this product in one word is lobster, which is not used immediately, but needs to be nurtured. When it accumulates enough usage habits on your platform, it is usually not easy to migrate.

Which is why today, although large language models are very powerful, application companies will still have many opportunities because they are closer to the user side and match the user habits more. Overall, we believe that EasyCloud is the best opportunity we have seen in the software field over the years. Of course, we will adhere to our independent development path, but embedding it in the super platform ecosystem in the form of functional modules does not rule out that we have some capabilities, including some core skill capabilities and some platforms to cooperate. I don’t think this kind of product has a so-called universality. In fact, if users use it well, the cost of migration is very high, and they will not move it just because of habit. Yes. This is similar to a product called Manus, which developed rapidly at that time.

When many users were imitating it continued to grow, right? Later, it was also acquired by Meta. Since we are from the tool and application background, we are very sensitive to products with vertical attributes that can meet user needs and continue to develop through comparative evaluation. I’m done.

Unknown, Moderator/IR Representative, Cheetah Mobile: We can talk about the following. Operator, please move to the next question. Thank you.

Unknown, Operator/Q&A Facilitator, Conference Call Operator: The next question comes from Chen Juoli from Guoyuan Securities. Please go ahead.

Chen Juoli, Analyst, Guoyuan Securities: Hello. Can you hear me?

Unknown, Moderator/IR Representative, Cheetah Mobile: Mr. Chen Mo, I can hear you. Yes.

Chen Juoli, Analyst, Guoyuan Securities: Okay. Congratulations on achieving very good results in 2020. I mainly want to know about the users and usage of our EasyCloud products because the management also mentioned that they are currently more concerned about the execution ability of this product. I would like to ask if we can share some user scale or usage related metrics, such as the number of users, activity, or the trend of token usage.

Fu Sheng, Chairman and CEO, Cheetah Mobile: What metrics are trending more concerned to judge the progress of EasyCloud development? Thank you. Your question is quite profound. I think for AI products, I really particularly agree with the point that to judge the real value of users of an AI product today, it lies in its usage volume. The data of this terminal usage volume should be our core measurement indicator. We have also seen that since the Spring Festival, especially after I did some promotion about my own use of OpenClaw, our token usage has definitely increased a lot. I don’t know if it can be disclosed. I mean, the token usage today since last year, we just started to enter the field of AIGC. We didn’t have much expectation and concept of the call volume at that time. We thought that a volume of ten-

Unknown, Operator/Q&A Facilitator, Conference Call Operator: Ladies and gentlemen, please stand by. Thank you for your patience. Please stand by, and thank you for your patience.

Fu Sheng, Chairman and CEO, Cheetah Mobile: Indeed, with the help of AI, many positions that used to require many years of work experience can now be done by young people with the same or even more efficient output. In terms of the overall cost structure, as we have mentioned before, we have opened up branches in Xi’an, Chengdu at the end of last year, which has significantly reduced our R&D costs. Our R&D efficiency has also been greatly improved. The launch of EasyCloud today and the launch of the wheelchair project in the robotics field are based on the fact that we have not increased our R&D investment. In other words, while our legacy products continue to grow, we still have the strength to invest in new areas. I think this is all thanks to the internal efficiency improvement brought by AI.

This year, our specific improvement directions are to strengthen the in-depth application of Eagle Eye, and we have already done department level, executive and department leader level, products like EasyCloud to truly participate in the company’s internal management and decision-making processes. Now it seems that the effect is very obvious. Of course, a large part of our work this year is also through EasyCloud to make our company more AI internalized so that our R&D pace and its effect can be better. This should also be seen in the next few quarters. Okay, thank you.

Unknown, Moderator/Q&A Facilitator, Cheetah Mobile: Thank you. Operator, please move to the next question.

Unknown, Operator/Q&A Facilitator, Conference Call Operator: The next question comes from Gigi Ju with GS Securities. Please go ahead.

Unknown, Moderator/Q&A Facilitator, Cheetah Mobile: Thank you, Yichen, for taking my question. I would like to follow up on the commercialization progress of EasyClaw. As the management mentioned before, we are still in the early stage and currently we focus on execution capabilities rather than solely on scale. We would like to ask, during this exploration, have you found any initial monetization methods? For example, based on subscription or call volume, or will we combine with existing products to improve the overall ARPU?

Fu Sheng, Chairman and CEO, Cheetah Mobile: Thank you. I think this wave is a very obvious feature of AIGC’s product. That is, users come with their own revenue, which means that you may also use our product now, and we charge based on the number of calls. We have cooperated with various model manufacturers. Whether it is these domestic models or overseas ones like Google and Amazon, because we have this cloud aggregation platform, we have relatively in-depth cooperation with them. We have both domestic and international versions. Currently, this version is based on what we call point consumption. In fact, it is the call to each company’s token. Today is also a natural model in terms of commercialization. EasyCloud itself has revenue. Although today the model is provided by the large model manufacturer. In terms of model invocation, we are still in the initial stage.

We will not consider profit, but use the token called by the user, and then replace it with a point model. We did not use a subsidy model or give too many tokens for you to use and then grab users, because we think that when users really use it, its token consumption is very large. This kind of subsidy model is not suitable for this kind of product. We still need to find users and serve them well and provide them with better product capabilities. In this way, when it improves its efficiency, it is very willing to pay for it. I think EasyCloud’s commercialization is a natural model. There is no need to consider too much.

Unknown, Moderator/IR Representative, Cheetah Mobile: Thank you, operator. Please move to the next question.

Unknown, Operator/Q&A Facilitator, Conference Call Operator: Next question from Wei Fang from Mizuho Securities. Please go ahead.

Wei Fang, Analyst, Mizuho Securities: Thank you for the management introduction. I would like to ask. I thought that the company has made good progress in the going global business, whether it’s your robot or EasyClaw. They are all expanding into overseas market. I would like to ask, have these businesses currently formed some more substantial synergies? If we look further in the process of going global, does the company tend to focus on a single product to break through? Or does it hope to gradually build an ecosystem with multiple products? If it is the latter, how does the company’s management view the synergy? How can it be converted into a competitive advantage for the company in the medium and long term for growth driver? Thank you.

Fu Sheng, Chairman and CEO, Cheetah Mobile: I think everyone thinks it works. Maybe ecosystems are easy, but I think without a breakthrough in a single product, there is no ecosystem. In the process of going global today, we are indeed considering making EasyClaw a good product. As long as it is done well enough, it will generate a multi-product ecosystem. Because EasyClaw is not a simple product. It is more of a technical framework. When this technical framework or product can be accepted by users, the entire ecosystem of that computer will be aligned with this product. Today, regardless of which business or traditional tools for ToC, including the team of our previous desktop software, whether it’s the so-called EasyCloud for ToB or our EasyCloud for ToC, or our advertising team going global or our cloud team, we are now integrating all our services on EasyCloud into each, because its performance for users is different.

Different demands require different skills, or different demands require different agents. This is our idea today. As long as we can truly customize EasyCloud for different users or personalize it, then it will form an ecosystem in the future. If we are at this stage, we are actually making a breakthrough in software products, but we will build different agents and skills on this single point. These different agents and skills are for both overseas advertising clients and overseas cloud clients. They can all be well served within such a product system. This was indeed very difficult before, because the service systems of cloud services and overseas advertising and the product system of the C-end users are different. To be honest, this was a problem that troubled us a lot in the past because it was too scattered. Now it can be unified into a product system.

We just need to install different skills and agents. This is our overall idea. Another point you mentioned is good. I think in the process of going global, we have some unique advantages, whether it’s our clients in the cloud, Amazon cloud, including Oracle cloud, our top partners, and Meta Ads are all first-tier agents, and also our best team experience. Our EasyClaw has both domestic and overseas versions. We hope to deepen all our services within such a product system. Okay. Thank you.

Unknown, Moderator/IR Representative, Cheetah Mobile: The first one. Provide the revenue for 2025 and achieve accelerated growth in 2024. The external business trend is available in 2026. What are the four driving factors behind this? The second question is from a non-application perspective, the robot business is a key focus of the current market. Could you please further break down the revenue of robots in 2026 and what will be the main source of growth? Will it be the scaling up of service robots or BCN products or some new application scenarios or other product expansions? The second question is also about the voice robot. Because the voice robot has been well implemented in China, will it be able to replicate in overseas markets in the future or to scale up?

What is the progress of the company’s overseas expansion? This is a good question.

Thomas Jintao Ren, Director and CFO, Cheetah Mobile: I am Thomas, the CFO of the company. Let me answer first and see if Mr. Fu has any additions. First, let’s talk about the first question. Let’s review the revenue growth in 2025. I think this shows that in the past year, our company’s overall strategic focus on business structure optimization have yielded results, specifically, as we mentioned in our presentation. On the one hand, we have been continuously promoting the subscription-based transformation in our internet business. This has improved the stability and visibility of our revenue. On the other hand, in AI and other sectors, including the robot business and the total service business overseas, almost all our business lines achieved rapid growth in 2025. The different business lines together drove the overall revenue growth.

We think from the current business structure, our current business combination is relatively healthy, and the contribution of new business is continuously improving, laying the foundation for our long-term development. Regarding the main source of growth in robot revenue in 2026, General Manager Fu mentioned this in the previous question, including voice robots and wheelchairs. Let’s summarize the business lines of robots. Firstly, the business of robotic arms. In fact, after consolidation in 2025, its operations have been very stable. Meanwhile, the demands from industrial scenarios, research institutions, and R&D teams are continuous. With a high recursion rate, it is expected that the robotic arm business will maintain a steady contribution in 2026 with a small increase. Secondly, our voice service robots in China have entered a stage of large-scale deployment and have been landed in various scenarios, including reception, explanation, elderly care, and hospitals.

Additionally, we will soon launch a new product called Xiaoming Live, which combines some agent technology and is a new voice service robot that can be used out of the box. We expect to continue to grow in the domestic voice service robot market. The third point is just mentioned by Mr. Fu, including what we mentioned in the manuscript. Our newly launched smart wheelchair product will also achieve commercial landing this year. Actually, this product does not generate any revenue at the current time. Now we have already cooperated with mature overseas mobile travel brands to sign a framework cooperation agreement. It is expected to become a new source of incremental revenue for the robot business starting from the second quarter. The current framework cooperation agreement has already established a foundation of certain scale orders, and the third batch of shipments are mainly concentrated overseas. Yes.

Regarding the voice robot in the overseas market. I learned that last year we mainly focused on the voice robot scenarios in China. After we think the scenarios in China are mature, we are actually doing some overseas markets, especially some accounts in high-end retail scenarios. We hope to extend more clients in overseas markets this year, bringing new revenue growth. That’s my answer. Let’s see if President Fu has any additions.

Unknown, Moderator/IR Representative, Cheetah Mobile: Let me add something. I feel that I am particularly systematically talk about why we want to make intelligent wheelchairs. Relatively after so many years of robots, we have carefully considered and investigated the market. We have made a strategic decision, which is a strategic-level product. Because the growth of voice robots, I think it grew well last year and will also grow this year. What is the difficulty of this kind of product? The difficulty lies in changing the user’s existing usage process. Actually, today in Shenzhen, the application of robots in China, whether it is enthusiasm or acceptance, is at the forefront of the world. This is the current situation. I always think that this product is called dual-end start. One end, you have to design a new product form.

Everyone has to figure out what the robot is in their mind, which is hard to figure out, or our education doesn’t think about it. Everyone has a different idea. On the one hand, you need to define the product form, and on the other hand, you need to guide users in the past workflow to put money into it. We can see that the truly fast-growing ones are robots, right? Either it’s a traditional robotic arm that replaces labor, which has been developed for a certain period of time or another type.

Fu Sheng, Chairman and CEO, Cheetah Mobile: Which is like some particularly simple machinery, such as sweeping robots. When we made robots in the past, it was quite difficult to get the market to accept a new product, and it changed its entire working mode. This is what we later repeatedly thought about. What kind of product can not only make good use of robot technology, but also be quickly accepted by users? The reason why we chose the smart wheelchair market is that we think the smart wheelchair is actually a robot for educating people. You can understand it as a food delivery robot. Isn’t this educating people?

Its entire technical chain, the entire technical chain of the wheelchair, whether it’s the chassis, motor, three electric systems, and the intelligent part we want to do, including navigation and obstacle avoidance, are actually very close to our entire technical path and reusability, which is very high. The second is that its market size is quite large, much larger than the current robot market size. The global smart wheelchair or electric wheelchair market should be over $2 billion, and it is growing every year. Especially the smart wheelchair market is growing the fastest. According to third-party reports, it can grow by more than 10% globally, which is actually our fast-growing market globally. In this market, it can be said that this industry has a long history. It has a history of over 100 years, but it is relatively backward in terms of intelligence.

Therefore, we believe this product can very well combine our technological path and our understanding of the technology of wheeled robots, including the user experience that we used to excel at. It should have a relatively stable and certain market size. I won’t go into further detail. In fact, our understanding is that transforming the delivery robot into one that can carry passengers is why we ventured into the smart wheelchair market after over a year of refinement. As you might know, many startups are now securing VC funding to develop similar products, and some such companies have already emerged. However, I want to say that previously, we had tens of thousands of robots, including those for export, which moved in various scenarios. We have accumulated substantial data about scenarios as well as various strengths of scenarios.

Therefore, we can use a highly cost-effective solution to greatly enhance the intelligence of the entire wheelchair. This is inseparable from the accumulation over the years. Therefore, I am quite confident in the growth of this product. Of course, as I just mentioned, its production cycle and overall certification will only start shipping in the middle of the year. Now, samples have already started to be provided to our suppliers and distributors, and the first batch will soon be offline, but the real sales and launch will start from June. For example, we only have half a year for sales, and this is the first model. I think in the long run, by next year, the growth of this product will be a good start. Okay, these are my additions to this.

Unknown, Analyst/Questioner, ByteDance: Because whether it’s for these additions, I just heard someone speak more clearly.

Fu Sheng, Chairman and CEO, Cheetah Mobile: Okay, thank you.

Unknown, Moderator/Q&A Facilitator, Cheetah Mobile: Operator, please move to the next question.

Unknown, Operator/Q&A Facilitator, Conference Call Operator: The next question comes from Vicky from ByteDance. Please go ahead.

Unknown, Analyst/Questioner, ByteDance: Good evening, management. Thank you for accepting my question. My question is about. We have seen that since the third quarter, the company has started to make consecutive quarterly profits, and the whole year is also well profitable. I would like to ask the management to look forward to whether we are confident in 2026 to continue the trend of quarterly and annual profitability. I have a small question. Considering that the company is in the field of AI agents such as B-Bot and is stepping up investment, the industry is in its early stage with fierce competition. How can the management strike a balance between continuous investment and profitability and provide us with a specific growth direction, such as at the current stage, whether our company should prioritize profit margins, revenue growth, or market share?

Fu Sheng, Chairman and CEO, Cheetah Mobile: Okay. Thank you, Vicky, for your question. I am Calvin, and I will answer it. First of all, entering 2026, one of our important internal management goals is still to take the management discipline and input-output efficiency as core internal management goals. Our overall strategy is to advance business development while maintaining a reasonable profit pace. We will not forego profit growth to chase an opportunity and make large-scale advanced investments without discipline. In terms of expectations for 2026, I need to make it clear that since the profitability of some of our B2B business depends to some extent on cooperation with various cloud vendors and advertising platforms and adjustments in their policy, which is one of the external variables we have to consider. It is also a factor we will focus on when formulating the 2026 annual plan from the perspective of internal management.

In the past, we have developed a relatively mature method for the incubation and investment of new businesses for different products, which is different from what we said earlier. We will not make large-scale investments first and then see the results, but continuously verify our business logic and input-output ratio while investing. The product Music Lab is actually promoted in strict accordance with this framework.

Thomas Jintao Ren, Director and CFO, Cheetah Mobile: As Mr. Fu Sheng said, we will not adopt a method of subsidizing computing power to obtain users. From the business design of the EasyCloud itself, it is a product paid by users. It comes with a revenue model from the very beginning. From the overall business structure, we rely on a dual-engine model, with the internet business continuing to serve as the stable source of profits and cash flow for the company through refined operations of the internet business and continuous improvement through AI enhancements. In terms of AI and other new business directions, which we have repeatedly mentioned before, we will focus on the directions that have already shown the potential of business growth or have undergone preliminary verification through technological optimization, including using AI to enhance our R&D efficiency. We will continuously improve our overall input-output efficiency.

From the perspective of capital allocation, the company will tend to use the profits and cash flow generated by existing businesses to support the development of new businesses. It will not make large-scale proactive investments to drive expansion. Overall, we will still adhere to our historically effective prudence and disciplined approach while continuously exploring long-term opportunities in AI to maintain a healthy operational foundation and business quality.

Unknown, Moderator/Q&A Facilitator, Cheetah Mobile: Thank you. Operator, please ask your next question.

Unknown, Operator/Q&A Facilitator, Conference Call Operator: The next question comes from Ding Zhang from CICC. Please go ahead.

Thomas Jintao Ren, Director and CFO, Cheetah Mobile: Meng Fu, you can communicate with him.

Fu Sheng, Chairman and CEO, Cheetah Mobile: I have a question about the internet business. We saw that the company’s entire internet business revenue and profit declined in the fourth quarter, which is obviously better than market expectations, and the gross profit margin also increased from negative 30% to see a significant improvement. On the basis of full disclosure, we want to know how the management will further promote the value of the internet business and better reflect in the overall valuation of the company.

Thomas Jintao Ren, Director and CFO, Cheetah Mobile: Thank you for your question. Let me answer your question. Indeed, judging from our performance in the fourth quarter, the profitability of the internet business has indeed improved significantly. More importantly, we are actually seeing that with the continuous promotion of the user payment model under this background. The internet business has been continuously optimized in terms of revenue visibility, business sustainability, and cost structure, which is also a core reason for the improvement of the operating profit margin of the entire internet business. From a business positioning perspective, as I mentioned earlier, the internet business will continue to serve as the company’s stable source of profits and cash flow, providing a solid foundation for the overall operations to support the development of new business. From a valuation perspective, we have always hoped to guide everyone to use a segmented approach to understand the company’s value structure.

In our understanding, for internet businesses with stable revenue and profitability and clear and mature business, PE as a profit multiple is usually used for valuation. Our own internet business actually achieved a non-GAAP operating profit of about CNY 110 million in 2025, with a year-on-year increase of 83%. We believe that this part of the value can be further recognized by the market. Regarding how to further promote the value release of the internet business and other sectors, we always maintain an open attitude. We still need to emphasize our core judgment, which has never changed. Our business itself, regardless of a specific business, its continuous development is the premise of value release. Only when the fundamentals of the business continue to improve can the value have long-term support.

From this perspective, we also hope that the market will not only see the internet business as a stabilizer, but also with the development of new AI agent products. We also hope everyone will pay attention to the company’s long-term opportunities in the AI direction, like the new product EasyClaw, which is still in its early stages, but actually represents a direction for the company to explore in the next stage of growth. To sum up, looking at it as a whole, we will maintain the steady development of the business and continuously improve the transparency of our disclosures in all aspects to guide the market to have a more comprehensive understanding of our company’s long-term value.

Unknown, Moderator/Q&A Facilitator, Cheetah Mobile: Thank you.

Fu Sheng, Chairman and CEO, Cheetah Mobile: Let me add a few words.

Thomas Jintao Ren, Director and CFO, Cheetah Mobile: Okay.

Fu Sheng, Chairman and CEO, Cheetah Mobile: I think everyone is very concerned about our profit, whether it can be sustained. I think Cheetah Mobile has been developing for so many years and has encountered some problems in the development process. Now we mainly have two businesses, the internet business and the software business, and then there is the robot business. Our overall idea is like this. As the colleague just mentioned, after years of adjustment, we are sure to achieve stable growth and profit in the internet business, including the apostles, products like QQ mobile. We are also in the software business. We are very pragmatic, and we really grow together with users. We have also answered the question of commercialization. We will not need subsidies to move our software business forward. Instead, we will truly build a software business into a basic profit-making business. This is the first point.

Second, some policy factors may affect some other incomes. In fact, this is not our main concern. We are more concerned about the machinery business. Although we have been working on it for many years, including launching new products this time, we still hope to truly seize this opportunity. Because today’s AI growth is empowering robots faster and faster. We definitely don’t want to get up early and miss the market. Therefore, when formulating strategies for the entire year of 2020. To be honest, we don’t necessarily make profitability our core assessment point. On the one hand, the software business is definitely our very important foundation. In terms of the robotics business, we will also, based on market conditions, consider it if the opportunity is good.

As for our investment, including the answer to the question about the way of profitability of robots, I think the scale of the robotics business should be given its priority, and continuous growth should also be prioritized. Especially when AI is so hot. I think businesses like robotics might have almost reached a critical point. This is our overall idea. After all, Cheetah Mobile still has over $200 million in cash on its books today. Yes, I remember over $200 million. We will focus more on long-term business development. In other words, we must seize the opportunity in this AI wave.

Unknown, Moderator/IR Representative, Cheetah Mobile: Thank you. Operator.

Fu Sheng, Chairman and CEO, Cheetah Mobile: Thank you.

Unknown, Moderator/IR Representative, Cheetah Mobile: Yes, thank you. Operator, please check if we have any further questions.

Unknown, Operator/Q&A Facilitator, Conference Call Operator: We have no further questions at this time. Which concludes our question and answer session. I would like to turn the conference back over to management for any closing remarks.

Unknown, Moderator/IR Representative, Cheetah Mobile: Thank you so much for joining our conference call today. If you have any further questions, please do not hesitate to let us know. Thank you so much.

Unknown, Operator/Q&A Facilitator, Conference Call Operator: The conference has now concluded, and we thank you for attending today’s presentation. You may now disconnect your line.