Phoenix New Media Q1 2025 Earnings Call Transcript

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Provided by Quartr
May 13, 2025

Key Takeaways

  • Paid services revenues surged 141% YoY to RMB 34.7 million, driven by digital reading services on third-party mini programs.
  • Net advertising revenues fell to RMB 120.5 million from RMB 138.6 million, as existing clients cut spending despite growth in new advertiser acquisition.
  • Loss from operations widened to RMB 38.4 million and net loss increased to RMB 29.7 million, primarily due to higher marketing and sales expenses for digital reading services.
  • Innovative content IPs like the KeyC Alien co-creation model and the “Why It Is” series generated significant engagement and unlocked new branding partnerships.
  • Q2 guidance projects total revenues of RMB 182.1–197.1 million, reflecting management’s confidence in improved advertising and paid services momentum.
AI Generated. May Contain Errors.
Earnings Conference Call
Phoenix New Media Q1 2025
00:00 / 00:00

Transcript Sections

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Operator

You will then hear an automated message advising your hand is raised.

Operator

To withdraw your question, please press 11 again. Please be advised that today's conference is being recorded. I would now like to turn the conference over to your speaker today, Mo Zi Gao from Investor Relations. Please go ahead.

Muzi Guo
Muzi Guo
IR Manager at Phoenix New Media

Thank you, operator. Welcome to Phoenix New Media's earnings conference call for the first quarter of twenty twenty five. Today's call will begin with an overview of our quarterly results, followed by a Q and A session. Our quarterly financial results and the webcast of this conference call are available on our website at ir.ifeng.com. Before we continue, please note the Safe Harbor statement in our earnings press release, which applies to any forward looking statements made during this call.

Muzi Guo
Muzi Guo
IR Manager at Phoenix New Media

Unless otherwise stated, all figures mentioned are in RMB. Joining me here today are our CEO, Mr. Yusheng Sun and our CFO, Mr. Edward Lu. I will now pass the call to Mr. Sun for his opening remarks. I will provide a translation as needed. Hello, everyone, and welcome. In Q1 twenty twenty five, Phoenix New Media navigated complex global and regional events, consistently delivering authoritative reporting with unmatched speed and depth, showcasing professional insight and reinforcing our industry leader leadership. Through sustained content innovation, leverage our quality content creation and distribution capabilities to deliver value to users and advertising clients, unlocking new commercial partnerships.

Muzi Guo
Muzi Guo
IR Manager at Phoenix New Media

Looking to Q2, we will further deepen content innovation, expand commercial opportunities and enhance operational efficiency, remaining committed to delivering long term value for investors. Now I will invite Edward to provide a more detailed summary of our first quarter performance on my behalf.

Edward Lu
Edward Lu
CFO at Phoenix New Media

Okay. Thank you, Munzi. In the first quarter of twenty twenty five, we showcased strong momentum by leading breaking news, driving content innovation and unlocking new commercial opportunities. Our content team excelled amid global trade volatility, regional political turbulence, natural disasters, and the rapid rise of artificial intelligence, consistently delivering authoritative reporting with unparalleled speed and depth. Across major Q1 events from South Korea's political upheaval to Trump's tariff escalation and the new energy vehicle safety concerns.

Edward Lu
Edward Lu
CFO at Phoenix New Media

We were frequently first to break the story, setting the pace for industry coverage. Our approach goes beyond guidelines, diving into the courses, personal stories and critical details that resonate with audiences while fostering active user engagement through interactive formats. For instance, our investigative series on Trump's tariffs and the lure impact on Asian markets alongside expose on NEV fare risks and deep six AI breakthroughs sparkled vibrant discussions ranking high on major social media platforms. Meanwhile, we advanced content innovation by developing unique IPs that deliver exceptional value to users and brands. A key highlight was the launch of KeyC Alien, a co creation model blending professional and the user generated content.

Edward Lu
Edward Lu
CFO at Phoenix New Media

Partnering with leading KOLs and the KOCs in finance and the tech, We crafted immersive experiences from trade show tours and the factory deep dives to industrial park visits that highlight corporate innovation, operational strength and the strategic vision, significantly boosting brand trust and visibility. Equally compelling is our new column, why it is which deputed with an in-depth look at Pop Mart's artistic industrialization model and global ambitions. Resonating strongly with brands seeking innovative framework. The launch garnered over 100,000 WeChat reads and widespread shares on social media, reflecting robust engagement and social impact. We are confident this series will continue to gain momentum, establishing a benchmark in its category.

Edward Lu
Edward Lu
CFO at Phoenix New Media

These content innovations translated directly into commercial success, showcasing our ability to convert creative excellence into business value. A prime example is our tech channels, Tesla's FSD China rollout. Within three hours, we connected with car owners and broadcast our first to market live test with exclusive footage driving viral attention and endorsements from industrial leaders on X. Building on this, our live plus short video plus trending topic strategy fueled a comparative test of automakers' intelligent driving systems, sparking cross platform buzz, including retreats from the CEO of top tier NEV makers. This approach allowed us to swiftly secure branding partnerships with top industry players.

Edward Lu
Edward Lu
CFO at Phoenix New Media

Beyond high profile tech events, we also unlocked values through authentic storytelling in routine coverage. During the two sessions, we captured the authentic story of a prominent industrial leader, The chairman of a leading global corporation in a short video that went viral, reaching over 60,000,000 views. This search elevated their personal brand, boosting their company's visibility and sales. It highlights a growing opportunity using our content expertise to craft compelling entrepreneur IPs. As businesses prioritize authentic leader driven narratives, Clients are turning to us to amplify these stories, creating new branding resources.

Edward Lu
Edward Lu
CFO at Phoenix New Media

Looking to Q2 twenty twenty five, we will deepen our commitment to content innovation, creating more viral IPs to bolster user loyalty and the brand influence. We will keep delivering tailored, high impact solutions for advertisers, expanding commercial avenues while sharpening operational efficiency. This concludes our CEO, Mr. Xun's prepared remarks. I will now walk you through our financial performance for the first quarter of twenty twenty five.

Edward Lu
Edward Lu
CFO at Phoenix New Media

All figures mentioned will be in RMB. Our total revenue were RMB155.2 million, representing a 1.4% increase year on year from 153,000,000. Specifically, net advertising revenues were 120,500,000.0 compared to 138,600,000.0 in the same period of last year. Paid services revenues were 34,700,000.0, representing a 141% increase year on year from 14,400,000.0, primarily driven by revenue generated from our digital reading services offered through mini programs on third party applications. Cost of revenues decreased by 15.1% to 92,500,000.0 from 109,000,000 in the same period of last year.

Edward Lu
Edward Lu
CFO at Phoenix New Media

Total operating expenses were 100,000,000, reflecting a 25.6% increase year on year from RMB80.5 million. This increase was primarily due to higher sales and marketing expenses incurred for the digital reading services mentioned earlier. Loss from operations was RMB38.4 million compared to RMB36.5 million in the same period of last year. Net loss attributable to iPhone was 29,700,000.0, compared to 26,000,000 in the same period of last year. Moving on to our balance sheet.

Edward Lu
Edward Lu
CFO at Phoenix New Media

As of 03/31/2025, the company's cash and cash equivalents, term deposits, short term investments and restricted cash totaled 984,500,000.0 or approximately US135.7 million dollars Finally, I'd like to provide our business outlook for the second quarter of twenty twenty five. We forecast total revenues to be between 182,100,000.0 and 197,100,000.0. For net advertising revenues, we project between 148,700,000.0 and 158,700,000.0. While for paid service revenues, we project between 33,400,000.0 and 38,400,000.0. This forecast reflects our current and preliminary view, which is subject to change and substantial uncertainties.

Edward Lu
Edward Lu
CFO at Phoenix New Media

This concludes the prepared portion of our call. We are now ready for questions. Operator, please go ahead.

Operator

Thank

Operator

Our first question comes from Alice Tan of First of Shanghai. Your line is now open.

Alice Tang
VP & Senior Equity Research Analyst at First Shanghai Sec.

Good morning, management. I was wondering, could you please share some insights on the trends and outlook for the company's advertising business in q one twenty twenty five, please? Thank you.

Edward Lu
Edward Lu
CFO at Phoenix New Media

Hi. Good morning, Alice. Thank you very much for the question. Actually, in Q1 twenty twenty five, our advertising business faced severe challenges. But our team responded actively, showing strong resilience.

Edward Lu
Edward Lu
CFO at Phoenix New Media

First, while the number of existing clients remained steady, their spending became more cautious, reducing average revenue per client. To address this, we focused on attracting new clients and their revenue grew significantly, balancing the decline from existing clients. Second, some industries had seasonal fluctuations. For for for for example, alcohol advertising dropped sharply. But we expanded quickly in finance, e commerce, consumer goods and electronics, achieving good progress.

Edward Lu
Edward Lu
CFO at Phoenix New Media

Also, certain clients had strong demand, but their project required a high investment and a cost. So we focused on refining our creative content resources and events to increase our pricing premium. Looking to Q2, advertisers are still cautious with marketing spending, but improving compared to Q1. Based on market research, advertisers are focusing more on brand value and media influence. We will continue to use our strengths as a leading Internet media platform offering high quality content and campaigns to create value for clients.

Edward Lu
Edward Lu
CFO at Phoenix New Media

Besides growing new industries and domestic clients, we are also exploring marketing partnerships with overseas companies in China. Our team is dedicated to staying competitive in this market. Thank you, Alice.

Operator

Thank you.

Alice Tang
VP & Senior Equity Research Analyst at First Shanghai Sec.

That's really clear. Thank you.

Operator

Thank you for all the questions. This concludes the Q and A session.

Operator

I will now pass the conference back to Mo Zi.

Muzi Guo
Muzi Guo
IR Manager at Phoenix New Media

Thank you. We have now come to the end of our Q and A session and conference call. If you have any additional questions, please don't hesitate to reach out to us. Thank you for joining us, have a great day.

Operator

This concludes today's conference call. Thank you for participating. You may now disconnect.

Executives
    • Muzi Guo
      Muzi Guo
      IR Manager
    • Edward Lu
      Edward Lu
      CFO
Analysts
    • Alice Tang
      VP & Senior Equity Research Analyst at First Shanghai Sec.
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