Financial Data and Key Metrics Changes - In Q4 2022, total revenues increased by 9% year-over-year to RMB 1.1 billion, marking the third consecutive quarterly revenue increase [7][19] - Adjusted net loss decreased by 44%, with adjusted net margin narrowing to minus 12% from minus 24% in the same period of last year [7][25] - GAAP net loss in Q4 was RMB 179.5 million, narrowing by 53.2% on a yearly basis and about 40% sequentially [24][25] Business Line Data and Key Metrics Changes - Revenue from paid membership totaled over RMB 400 million in Q4, with a year-over-year growth rate of 93% [7][20] - Vocational training revenue reached RMB 84.6 million in Q4, a significant increase of 281% from RMB 22.2 million in the same period of 2021 [20] - Revenue from enterprise-oriented business, including online advertising and CCS, decreased by 23% year-over-year in Q4 due to pandemic-related disruptions [8][21] Market Data and Key Metrics Changes - Average monthly active users (MAUs) grew to 101 million by year-end 2022, with a 14% year-over-year increase in content creators, totaling 53.1 million [6][19] - Daily education-related searches increased significantly, accounting for a meaningful portion of total daily searches in Q4 [14] Company Strategy and Development Direction - The company is focused on a "Community Ecosystem First" strategy, aiming to expand high-quality content and user engagement [6][19] - Plans to invest in AI-based large language models (LOMs) and enhance technical capabilities to improve user experience and content creation [15][16] - The company aims to grow its user-oriented business, particularly in paid memberships and vocational training, which are expected to contribute significantly to total revenues [19][20] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges faced in 2022 due to COVID-19 and economic turmoil but expressed confidence in the company's resilience and growth potential [6][19] - The company anticipates continued growth in its community and education-related businesses, with a focus on technology investments to enhance operational efficiency [39][56] Other Important Information - As of December 31, 2022, the company had cash and cash equivalents of RMB 6.3 billion and had repurchased 6.5 million Class A ordinary shares at a total cost of USD 16.7 million [25] Q&A Session Summary Question: What are Zhihu's strategies for integrating large language models? - Management is evaluating both self-development and collaboration with third parties to empower content creation [28][30] Question: What are the company's priorities for 2023? - The company will continue with its ecosystem-first strategy, focusing on community and education-related business growth [33][35] Question: How is the advertising and CCS business recovering? - Recovery depends on the macroeconomic environment in China, which may take time [42] Question: What is the outlook for gross profit margin and breakeven timing? - Gross profit margin improved to about 56% in Q4, with expectations of around 50% on average moving forward [44][45] Question: What is the strategy for the membership business? - The membership business is expected to achieve high growth, with a focus on enhancing the content creation ecosystem [46][51] Question: What are the medium to long-term goals for the education segment? - The education-related business is seen as a massive market with opportunities for both organic growth and M&A [52][55]
ZHIHU(ZH) - 2022 Q4 - Earnings Call Transcript