百度 (BIDU) 2019 Q3 法說會逐字稿

Hello, and thank you for standing by for Baidu's Third Quarter 2019 Earnings Conference Call. (Operator Instructions) Today's conference is being recorded. If you have any objections, you may disconnect at this time.

您好，感謝您參加百度2019年第三季財報電話會議。（操作員指示）今天的會議正在錄製。如果您有任何異議，您可以立即斷開連接。

I would now like to turn the meeting over to your host for today's conference, Juan Lin, Baidu's Director of Investor Relations.

現在，我想將會議交給今天的會議主持人，百度投資者關係總監林娟。

Hello, everyone, and welcome to Baidu's Third Quarter 2019 Earnings Conference Call. Baidu's earnings release was distributed earlier today, and you can find a copy on our website as well as on Newswire services.

大家好，歡迎參加百度2019年第三季業績電話會議。百度的財報已於今天早些時候發布，您可以在我們的網站和新聞專線服務上找到一份副本。

On the call today, we have Robin Li, our Chief Executive Officer; Herman Yu, our Chief Financial Officer; and Dou Shen, our Senior Vice President in charge of Baidu's Mobile Ecosystem Group, our search and feed business. After our prepared remarks, we will hold a Q&A session.

參加今天電話會議的有我們的執行長李彥宏；我們的財務長 Herman Yu；以及我們的高級副總裁竇深，負責百度行動生態系統事業群、搜尋和資訊流業務。在我們準備好發言之後，我們將舉行問答環節。

Please note that the discussion today will contain forward-looking statements made under the safe harbor provisions of the U.S. Private Securities and 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, including our annual report on Form 20-F. Baidu does not undertake any obligation to update any forward-looking statement except as required under applicable law.

請注意，今天的討論將包含根據 1995 年美國私人證券和訴訟改革法案的安全港條款做出的前瞻性陳述。前瞻性陳述受風險和不確定性的影響，可能導致實際結果與我們目前的預期有重大差異。潛在風險和不確定性包括但不限於我們向美國證券交易委員會提交的公開文件中概述的風險和不確定性，包括我們的 20-F 表年度報告。除適用法律要求外，百度不承擔更新任何前瞻性聲明的義務。

Our earnings press release and this call include discussions of certain unaudited non-GAAP financial measures. We have made minor adjustments to our non-GAAP measures and retroactively applied these changes for comparison purposes. Our press release contains a reconciliation of the unaudited non-GAAP measures to the unaudited most directly comparable GAAP measures and is available on our IR website at ir.baidu.com.

我們的收益新聞稿和本次電話會議包括對某些未經審計的非公認會計準則財務指標的討論。我們對非公認會計準則指標進行了微調，並為了比較目的而追溯應用了這些變更。我們的新聞稿包含未經審計的非 GAAP 指標與未經審計的最直接可比較 GAAP 指標的對賬，可在我們的 IR 網站 ir.baidu.com 上查閱。

As a reminder, this conference is being recorded. In addition, a webcast of this conference call will also be available on Baidu's IR website.

提醒一下，本次會議正在錄製中。此外，本次電話會議的網路直播也將在百度投資者關係網站上提供。

I will now turn the call over to our CEO, Robin.

現在我將電話轉給我們的執行長羅賓。

Hello, everyone. Baidu's third quarter revenues reached RMB 28.1 billion, above the midpoint of our guidance with Baidu Core performing better than our original expectations. Baidu Core revenues grew 8% sequentially in the third quarter, on top of the 12% sequential growth in the second quarter. In spite of the slowing macro environment, industry-specific policy changes and self-directed health care initiative. Baidu Core's quarterly sequential growth rates, compared to last year's second and third quarter of 26% and 9%, respectively, excluding spinoff revenues, have been narrowing. Our marketing service business is improving in part due to a stabilizing market as well as our efforts to strengthen our mobile ecosystem and our monetization capabilities.

大家好。百度第三季營收達到人民幣 281 億元，高於我們預期的中位數，「百度核心」的表現優於我們最初的預期。百度核心營收第三季季增 8%，第二季較上季成長 12%。儘管宏觀環境放緩，但行業特定的政策發生了變化，並且自主的醫療保健措施也在不斷湧現。百度核心季季成長率，與去年第二季及第三季分別26%及9%（不含分拆營收）相比，有所收窄。我們的行銷服務業務正在改善，部分原因是市場穩定以及我們努力加強行動生態系統和貨幣化能力。

We have made significant progress in strengthening Baidu's mobile ecosystem, centering around information and knowledge. We continue to push the limits of Baidu AI to better match users to the vast and diversified content pool in Baidu App. Our Top-1 satisfying user queries with the first result has reached 56% compared to 40% a year ago.

我們在加強以資訊和知識為中心的百度移動生態系統方面取得了重大進展。我們不斷突破百度人工智慧的極限，以便更好地將用戶與百度應用程式中龐大且多樣化的內容池進行配對。我們的 Top-1 滿意用戶查詢的第一個結果已達到 56%，而一年前為 40%。

On top of leading search and a comprehensive set of knowledge-based products, Baidu App provides hosted solutions such as Baijiahao, or BJH account, smart mini program and Managed Page to publishers, app developers and HTML5 site owners to offer a wide range of third-party content and services in Baidu App with native app-like experience. Our efforts to strengthen Baidu's mobile ecosystem with hosted solutions add a high level of barrier to entry to in-app search while presenting Baidu with newsfeed and short video opportunities. Baidu's cutting-edge AI technologies plus hosted solutions are leading to a better search and feed experience, which is drawing many users to log in on Baidu App.

除了領先的搜尋和全面的知識產品之外，百度 App 還為出版商、應用程式開發人員和 HTML5 網站所有者提供百家號、智慧小程式和託管頁面等託管解決方案，以便在百度 App 中提供廣泛的第三方內容和服務，並提供類似原生應用程式的體驗。我們致力於透過託管解決方案強化百度的行動生態系統，為應用程式內搜尋增加高門檻，同時為百度提供新聞推播和短影片機會。百度尖端的人工智慧技術加上託管解決方案正在帶來更好的搜尋和資訊流體驗，吸引了大量用戶登入百度應用程式。

In the third quarter, we began to unify our mobile pillars, BJH, smart mini program, Managed Page and CRM, onto a hosted marketing platform to allow our customers to build brand, engage with users and grow audience. Our hosted marketing platform leverages Baidu's technologies and user insight to enable SMEs and KAs to perform user relationship management. In August, we made available a toolkit of over 300 web creative content templates on our hosted platform, and now, Managed Page owners can significantly streamline their app creative process with the toolkit. We also released a toolkit to our customers to enable users who see their ads complete a lead generation form with just one click. By offering a hosted marketing platform that can be continuously upgraded with Baidu technologies, our customers can focus on the marketing rather than the IT aspect of their campaigns, which will make Baidu's marketing services more compelling.

在第三季度，我們開始將我們的行動支柱、BJH、智慧小程式、託管頁面和 CRM 統一到託管行銷平台上，以便我們的客戶建立品牌、與用戶互動並擴大受眾。我們的託管行銷平台利用百度的技術和用戶洞察力，使中小企業和知識大戶能夠執行用戶關係管理。8 月份，我們在託管平台上提供了包含 300 多個網頁創意內容範本的工具包，現在，託管頁面所有者可以使用該工具包顯著簡化他們的應用程式創意流程。我們還向客戶發布了一個工具包，讓看到其廣告的用戶只需單擊即可填寫潛在客戶生成表格。透過提供可以使用百度技術不斷升級的託管行銷平台，我們的客戶可以專注於行銷而不是行銷活動的 IT 方面，這將使百度的行銷服務更具吸引力。

We also made great progress in Baidu's new AI businesses and in improving our operational efficiencies, which Herman will elaborate later on.

我們在百度新的人工智慧業務和提高營運效率方面也取得了很大進展，Herman 稍後會詳細說明。

On search and feed, in September, Baidu App daily active users continued to see robust growth, reaching 189 million. That's up 25% year-over-year. Momentum for in-app traffic remains strong, with in-app search queries growing over 25% year-over-year; feed time spent, up 16% year-over-year; and feed plus short video app time spent, up 35% year-over-year. On top of rapid traffic growth, user log in has been growing now accounting more than half of Baidu App's daily active users.

搜尋和資訊流方面，9月百度App日活躍用戶持續保持強勁成長，達1.89億。與去年同期相比成長了 25%。應用程式內流量動能依然強勁，應用程式內搜尋查詢量年增超過 25%；餵食時間增加，較去年同期成長16%；以及資訊流和短視頻應用的投放時間較去年同期成長35%。除了流量快速成長之外，用戶登入量也不斷成長，目前已佔百度App日活躍用戶的一半以上。

BJH now hosts 2.4 million publisher accounts, up 57% year-over-year. BJH allows our publishers to get the optimal exposure in Baidu Search. Our efforts to improve content quality and emphasize the social aspects of BJH have boosted traffic and user engagement. In September, content sharing was up 29% year-over-year, while usage of like functions grow 89% year-over-year.

BJH 目前擁有 240 萬個發布商帳戶，年增 57%。BJH 讓我們的發布商在百度搜尋中獲得最佳曝光率。我們努力提高內容品質並強調 BJH 的社交方面，從而提高了流量和用戶參與度。9月份，內容分享年增29%，同類功能使用量較去年同期成長89%。

Our knowledge-based products, including Baidu Wiki, Baidu Knows, Baidu Experience and Baidu Wenku, have accumulated over 1 billion content pieces, including articles, videos, etc, collaboratively produced with users, professionals and institutions. Our focus to enrich Baidu's knowledge content has led to a significant increase in user engagement. For example, in September, daily user time spent on Baidu knowledge content in Baidu family of apps grow 41%, while daily video views, including Baidu Wiki and Baidu Experience, increased 36% as compared to June.

我們的知識型產品，包括百度維基、百度知道、百度體驗和百度文庫，已經累積了超過 10 億條內容，包括文章、影片等，由使用者、專業人士和機構共同製作。我們致力於豐富百度的知識內容，從而顯著提高用戶參與度。例如，9月份，百度系列應用程式中百度知識內容的每日用戶使用時間較6月份成長41%，包括百度維基和百度體驗在內的每日影片觀看次數較6月份成長36%。

Baidu's smart mini program is seeing great traffic momentum with MAUs reaching 290 million in September, up 157% year-over-year. And 1/4 of Baidu's in-app user clicks from search results were fulfilled by the information and services from Baidu's smart mini program. In addition, in the last 3 months, the number of smart mini programs more than doubled, while user time spent on Baidu's smart mini program grew 32%.

百度智慧小程式流量成長勢頭強勁，9 月份月活躍用戶達 2.9 億，較去年同期成長 157%。百度應用程式內用戶搜尋結果點擊量有四分之一是透過百度智慧小程式提供的資訊和服務實現的。此外，過去3個月，智慧小程式數量增加了一倍多，用戶在百度智慧小程式上的使用時間增加了32%。

We are excited to see app developers adopting Baidu's smart mini programs as a key channel for user acquisition and to deepen customer engagement. By leveraging Baidu's intent-based traffic, hosted marketing platform and smart mini program's closed-loop features, our partners can continuously improve traffic growth and conversion through user relationship management on Baidu. For example, a well-known e-commerce company in China used Baidu's smart mini program to give away coupons to users, leveraging Baidu's user insight, and saw its conversion improve 2.5 times over HTML5 pages.

我們很高興看到應用程式開發人員採用百度的智慧小程式作為獲取用戶和深化客戶參與度的關鍵管道。透過利用百度基於意圖的流量、託管行銷平台和智慧小程式的閉環功能，我們的合作夥伴可以透過百度的用戶關係管理不斷提高流量成長和轉換率。例如，國內某知名電商企業利用百度智慧小程式向用戶發放優惠券，利用百度的用戶洞察，轉換率較HTML5頁面提升2.5倍。

The adoption of Baidu's smart mini program is also helping our customers broaden their spectrum of marketing options. A leading K-12 after-school tutoring provider used their Baidu's smart mini program to allow users who see their ads automate the completion of sales lead forms for trial classes with one click, for user authorization. By hosting the traffic on Baidu's platform, the education company improved its marketing ROI by 30% compared to its HTML5 site. By connecting to Baidu's platform through an SDK or through hosting on Baidu Cloud, Baidu's smart mini program partners can leverage the advanced technology and user insight provided by Baidu's tool kits.

百度智能小程式的採用也幫助我們的客戶拓寬了行銷選擇範圍。一家領先的 K-12 課後輔導提供者使用百度的智慧小程序，讓看到其廣告的用戶一鍵自動填寫試聽課的銷售線索表格，以供用戶授權。透過將流量託管在百度平台上，該教育公司的行銷投資回報率與其 HTML5 網站相比提高了 30%。透過 SDK 連接到百度平台或託管在百度雲端上，百度智慧小程式合作夥伴可以利用百度工具包提供的先進技術和用戶洞察。

Turning to Managed Page. Better user experience and ad conversion are leading to the adoption of our Managed Page. Revenue from Managed Page in the third quarter accounted for nearly 1/5 of Baidu Core's marketing revenue.

轉到管理頁面。更好的使用者體驗和廣告轉換率促使我們採用託管​​頁面。第三季託管頁面收入佔百度核心行銷收入的近五分之一。

We are adding more benefits for SMEs to move to Managed Page. In August, we released a toolkit on Baidu's hosted marketing platform with over 300 content creative templates, which makes it easier for SMEs from all industries to migrate their H5 sites to Baidu's Managed Page.

我們正在為中小企業遷移到託管頁面提供更多好處。8月份，我們在百度託管行銷平台上線了工具包，其中包含300多個內容創意模板，方便各行各業的中小企業將H5網站遷移到百度託管頁面。

In the health care area, we're seeing our customers use more video content on their Managed Page to provide health care information to users compared to the original H5 site. Managed Pages are hosted on Baidu Cloud, which is typically more stable and provides a smoother experience for video broadcasting than the IT infrastructure SMEs usually purchase on their own.

在醫療保健領域，我們發現與原始的 H5 網站相比，我們的客戶在其託管頁面上使用更多的影片內容來向用戶提供醫療保健資訊。託管頁面託管在百度雲上，與中小企業通常自行購買的 IT 基礎設施相比，百度雲通常更穩定，並且能夠提供更流暢的視訊廣播體驗。

Managed Page can also improve conversion. For example, a driving school in Xi'an, the capital of Shaanxi Province, saw an 80% lift in lead conversions compared to its own H5 site by using the online chat and live call consultation tool kit from Baidu's hosted marketing platform with its Managed Page.

託管頁面還可以提高轉換率。例如，陝西省省會西安的一家駕校，透過使用百度託管行銷平台及其託管頁面的線上聊天和即時電話諮詢工具包，與自己的 H5 網站相比，潛在客戶轉換率提高了 80%。

According to CNNIC, there are approximately 5 million websites in China, and most of them do not have the resources nor capabilities to leverage AI and other leading technologies to improve their marketing effectiveness. By joining Baidu's Managed Page and using our hosted marketing platform, SMEs can continuously improve traffic growth and marketing conversion in light of the slowing overall mobile traffic growth in China.

根據CNNIC統計，中國約有500萬個網站，其中大多數網站缺乏資源和能力利用人工智慧等領先技術來提升行銷效果。透過加入百度託管頁面並使用我們的託管行銷平台，中小企業可以在中國整體行動流量成長放緩的情況下不斷提高流量成長和行銷轉換率。

Turning to monetization. We have expanded oCPX for newsfeed to oCPX for Phoenix Nest, our search monetization platform, to allow SMEs to purchase P4P marketing services based on a cost-per-action basis most suitable for their industry, such as on a cost-per-lead, cost-per-download or cost-per-purchase basis. By knowing what the return will be in advance based on the metrics that our customers care about, oCPX now can improve marketing ROI certainty for search on the backdrop of current macro uncertainties. In the third quarter, ad spending on oCPX grew fourfold, and average cost per action decreased over 10% year-on-year.

轉向貨幣化。我們已將用於新聞推送的 oCPX 擴展為用於搜尋貨幣化平台鳳巢的 oCPX，以允許中小企業根據最適合其行業的每次行動成本（例如按每次引導成本、按每次下載成本或按每次購買成本）購買 P4P 行銷服務。透過根據客戶關心的指標提前了解回報，oCPX 現在可以提高在當前宏觀不確定性的背景下搜尋的行銷投資回報率確定性。第三季度，oCPX的廣告支出增加了四倍，平均每次行動成本年減了10%以上。

In summary, we are building a comprehensive and diversified mobile ecosystem centered around information and knowledge with Baijiahao, smart mini program and Managed Page as important pillars. Our hosted solutions enable publishers, app developers and customers to share their content, information and services on Baidu's platform with native app-like experience, which is translating into robust traffic growth for Baidu App and providing a foundation for us to enable our customers and partners to grow through the use of Baidu's technologies.

綜上所述，我們正在以百家號、智慧小程式、託管頁面為重要支柱，建立一個以資訊和知識為核心的全面、多樣化的行動生態系統。我們的託管解決方案使出版商、應用程式開發人員和客戶能夠在百度平台上以類似原生應用程式的體驗分享他們的內容、資訊和服務，這轉化為百度應用程式強勁的流量增長，並為我們的客戶和合作夥伴透過使用百度技術實現成長奠定了基礎。

Moving to DuerOS. In the third quarter, DuerOS voice assistant continues to grow fast, with monthly voice queries surpassing 4.2 billion in September, up over 4.5-fold year-over-year. DuerOS is gaining strong momentum in the Chinese market due to our relentless focus on user experience. We strive to upgrade features in DuerOS to make voice assistant friendlier to use. For example, DuerOS for Xiaodu Smart Display can now respond to hand gestures to stop playing music when one hears a phone call, for instance, and make full-duplex continued conversation or multi-round conversation without wake words through eye gesture detection.

遷移至 DuerOS。第三季度，DuerOS語音助理持續快速成長，9月每月語音查詢量突破42億次，較去年同期成長超過4.5倍。由於我們堅持不懈地專注於用戶體驗，DuerOS 在中國市場獲得了強勁發展勢頭。我們致力於升級 DuerOS 的功能，讓語音助理更容易使用。例如，小度智慧顯示器的 DuerOS 現在可以響應手勢，例如在聽到電話時停止播放音樂，並透過眼部手勢檢測進行全雙工繼續對話或多輪對話，而無需喚醒單字。

Turning to DuerOS first-party devices. While our goal for DuerOS smart speakers is not necessarily to be #1, meaning, hardware sales, Xiaodu smart speakers continue to see strong sales momentum. Leading market research firms Canalys, Strategy Analytics and IDC ranked Xiaodu series speakers #1 in smart speaker shipments in China for the second quarter. According to Canalys, Baidu overtook Google in the second quarter to become #2 globally in smart speaker shipment, while IDC reported that Xiaodu Smart Display ranked first in smart display shipment globally in the second quarter. We believe it is important for Xiaodu smart speakers to maintain a large market share because scale will allow us to build brand, increase pricing power and reduce unit cost.

轉向DuerOS第一方裝置。雖然我們對 DuerOS 智慧音箱的目標不一定是成為硬體銷售第一，但小度智慧音箱的銷售動能依然強勁。領先的市場研究公司Canalys、Strategy Analytics和IDC將小度系列音箱評為第二季中國智慧音箱出貨量第一名。根據Canalys數據顯示，百度第二季超越Google，成為全球智慧音箱出貨量第二大廠商；IDC數據顯示，小度智慧顯示器第二季在全球智慧顯示器出貨量中排名第一。我們認為，小度智慧音箱維持較大的市佔率非常重要，因為規模將使我們能夠打造品牌、提高定價能力並降低單位成本。

We are differentiating Xiaodu smart speakers through Baidu AI capabilities and the breadth of service offerings provided by DuerOS skills store. We are excited by the opportunity to monetize DuerOS smart speakers through membership, advertising, skills store revenue share as we test trial different monetization options over the next year.

我們透過百度人工智慧功能和 DuerOS 技能商店提供的廣泛服務產品來區分小度智慧音箱。我們很高興有機會透過會員資格、廣告、技能商店收入分成將 DuerOS 智慧音箱貨幣化，我們將在明年測試不同的貨幣化選項。

On Apollo, we are excited about our progress in early-stage commercialization of smart transportation, especially in terms of forming strategic partnerships with municipal governments across China and helping bigger cities improve transportation, traffic safety and air quality using Baidu AI.

在阿波羅方面，我們對智慧交通早期商業化方面的進展感到非常興奮，特別是在與中國各地市政府建立戰略合作夥伴關係以及利用百度人工智慧幫助大城市改善交通、交通安全和空氣品質方面。

In September, China's first robotaxi pilot program was made available to the public with an initial fleet of 45 Apollo-powered autonomous vehicles roaming the streets of Changsha, the capital city of the Hunan Province. Hundreds of passengers in the city of Changsha experienced Apollo-powered robotaxi fleet in the first 30 days. Initial feedback has been quite positive. Changsha's robotaxi pilot program leverages Baidu's V2X solution which sends signals on traffic lights and close-proximity traffic condition to Apollo-powered vehicles, overcoming blind spots and improving traffic efficiency and safety.

9 月，中國首個自動駕駛計程車試點計畫正式對外開放，首批 45 輛搭載阿波羅技術的自動駕駛汽車在湖南省省會長沙的街道上行駛。在前 30 天，長沙市數百名乘客體驗了搭載 Apollo 技術的自動駕駛計程車車隊。初步反饋非常正面。長沙的自動駕駛計程車試點計畫利用百度的 V2X 解決方案，將交通號誌和近距離交通狀況號誌發送給搭載 Apollo 技術的車輛，從而克服盲點，提高交通效率和安全性。

On cloud, at the Baidu Cloud ABC Summit in August, new AI enterprise solutions were introduced to optimize visual, speech processing and other AI capabilities to help customers increase productivity and improve operational efficiency. For example, Baidu Cloud released an AI-powered video editing solution that can automate the tedious task of cutting films into video clips and tagging them while the film is broadcasted live. The official website of China's largest TV station, CCTV.com, used Baidu Cloud video editing AI solution during the live broadcasting of China's 70th anniversary celebration on October 1 and saw its video editing efficiency gain by roughly 10 times.

雲端方面，8月百度雲ABC高峰會上，推出全新AI企業解決方案，優化視覺、語音處理等AI能力，協助客戶提升生產力，改善營運效率。例如，百度雲發布了一款人工智慧影片編輯解決方案，可以自動完成將影片剪輯成影片片段並在直播時進行標記的繁瑣任務。中國最大電視台央視網官網在10月1日新中國成立70週年慶典直播中，採用了百度雲影片剪輯AI解決方案，影片剪輯效率提升約10倍。

Baidu Cloud also released an extension of its AI call center enterprise solution, which Shanghai Pudong Development Bank, or SPD Bank, is using to develop its virtual customer service representative, called Xiaopu. Xiaopu will appear in SPD Bank's mobile app carrying human-like expressions as it interacts with SPD customers as a virtual assistant. We see such call center solution extension applicable to industries beyond the financial services, such as telecommunication, media and education.

百度雲也發布了其人工智慧呼叫中心企業解決方案的擴展，上海浦東發展銀行（SPD銀行）正在使用該解決方案開發其名為小浦的虛擬客服代表。小樸將出現在浦發銀行的手機應用程式中，帶有類似人類的表情，作為虛擬助理與浦發銀行的客戶互動。我們看到這種呼叫中心解決方案的擴展適用於金融服務以外的行業，例如電信、媒體和教育。

To encourage the usage of Baidu AI and Baidu Cloud services, we continue to improve Baidu's AI technologies and make them available on Baidu's AI Open Platform, which saw user growth in the third quarter with developer membership more than doubling from last year to over 1.5 million.

為了鼓勵使用百度人工智慧和百度雲服務，我們不斷改進百度的人工智慧技術，並將其提供給百度人工智慧開放平台。該平台在第三季的用戶數量有所增長，開發者會員數量較去年同期增長了一倍多，達到 150 多萬。

In September, Baidu Maps enhanced its voice feature with Baidu leading voice synthesis technology, allowing users to customize the voice feature on Baidu Maps with user's own voice by recording just 20 sentences. Over 280 million Baidu users have used the Baidu Maps voice feature as of September, doubling from the previous year.

9月，百度地圖升級語音功能，引進百度領先的語音合成技術，使用者只需錄製20句話，即可用自己的聲音客製百度地圖的語音功能。截至9月，已有超過2.8億百度用戶使用百度地圖語音功能，較上年同期成長一倍。

Turning to iQIYI. iQIYI continues its solid membership growth with subscribers reaching 105.8 million in September, up 31% year-over-year. iQIYI's strong membership growth further strengthens its foundation as a leading video platform in China, self-producing long-form videos series, and as an important video partner of Baidu's search plus feed ecosystem.

轉向愛奇藝。愛奇藝會員數量持續穩定成長，9 月會員數量達到 1.058 億，年增 31%。愛奇藝會員數量的強勁增長進一步鞏固了其作為中國領先視頻平台、自主製作長視頻系列以及百度搜索+信息流生態系統重要視頻合作夥伴的基礎。

With that, let me turn the call over to Herman to go through the financial highlights.

說完這些，讓我把電話轉給赫爾曼，讓他介紹一下財務亮點。

Thanks, Robin. Hello, everyone. Welcome to Baidu's third quarter 2019 call. All monetary amounts used in our discussion are in renminbi unless stated otherwise.

謝謝，羅賓。大家好。歡迎參加百度2019年第三季電話會議。除非另有說明，我們討論中使用的所有貨幣金額均為人民幣。

Total revenues for the third quarter reached CNY 28.1 billion, or [USD 3.93 billion] (corrected by company after the call), up 3% year-over-year, excluding spin off revenues, and up 7% quarter-over-quarter. Revenue from Baidu Core was CNY 21 billion, or USD 2.94 billion, up 2% year-over-year, excluding spin off revenues, and up 8% quarter-over-quarter. Marketing Services revenue saw strength from education, retail and services sectors and were offset by weakness in health care, financial services, franchising and auto sectors. As Robin mentioned, we are seeing a stabilizing market in general.

第三季總收入達到人民幣 281 億元，或 [39.3 億美元]（電話會議後公司進行了更正），年增 3%（不包括分拆收入），環比增長 7%。「百度核心」營收為 210 億元（約 29.4 億美元），較去年同期成長 2%（不含分拆收入），較上季成長 8%。行銷服務收入得益於教育、零售和服務業的強勁成長，但被醫療保健、金融服務、特許經營和汽車業的疲軟所抵消。正如羅賓所提到的，我們看到市場總體上正在穩定下來。

Our new AI businesses, including DuerOS smart devices and Baidu Cloud, continue to see fast growth, which in total grew over 100% year-over-year. Xiaodu smart speakers saw a robust growth, and the unit economics are improving through price increases and reduction in cost of goods sold. Baidu Cloud revenue for the third quarter was up over 70% year-over-year as we placed more emphasis on project margins. Going forward, we will not disclose Baidu Cloud revenue separately each quarter. Revenue scale, margins and pricing are sensitive information in the highly competitive markets of smart speakers, cloud and other AI businesses.

DuerOS智慧型裝置、百度雲等AI新業務持續快速成長，合計較去年同期成長超過100%。小度智慧音箱實現了強勁成長，並透過提價和降低銷售成本，單位經濟效益正在改善。由於我們更加重視專案利潤率，百度雲第三季營收年增超過 70%。展望未來，我們不會在每季單獨揭露百度雲收入。在智慧音箱、雲端和其他人工智慧業務等競爭激烈的市場中，收入規模、利潤率和定價都是敏感資訊。

iQIYI revenue reached CNY 7.4 billion, up 7% year-over-year. Membership revenue continued to see strong growth, up 30% year-over-year, and iQIYI's ad business was down 14% year-over-year due to slowing macro, delay of top content launches and heavy competition from in-feed advertising.

愛奇藝營收達74億元人民幣，較去年成長7%。會員收入持續強勁成長，年增30%，而愛奇藝的廣告業務則因宏觀經濟放緩、優質內容推出延遲以及資訊流廣告的激烈競爭而同比下降14%。

Adjusted EBITDA reached CNY 5.1 billion, and adjusted EBITDA margin was 18%. Adjusted EBITDA for Baidu Core reached CNY 7.5 billion, or USD 1.05 billion. And adjusted EBITDA margin for Baidu Core reached 36% compared to 24% from last quarter.

調整後EBITDA達51億元人民幣，調整後EBITDA利潤率為18%。百度核心的調整後EBITDA達75億元人民幣，約10.5億美元。百度核心的調整後EBITDA利潤率達到36%，而上一季為24%。

On a sequential basis, Baidu Core revenue grew CNY 1.5 billion, while Baidu Core adjusted EBITDA increased CNY 2.8 billion. Our disciplined approach to spending coupled with the traction that we have made in strengthening Baidu's mobile ecosystem have allowed Baidu Core sequential revenue increase to basically fall to the bottom line, while our cost management initiatives have contributed to the sequential decrease of over CNY 1 billion in Baidu Core's costs and expenses. We continue to invest heavily for the future, and our disciplined approach puts an emphasis on investment and return.

以環比計算，「百度核心」營收成長15億元人民幣，調整後EBITDA成長28億元。我們嚴謹的支出方式，加上我們在加強百度行動生態系統方面所取得的進展，使「百度核心」的環比收入增幅基本降至底線，而我們的成本管理舉措則使「百度核心」的成本和費用環比減少了 10 多億元。我們將繼續為未來投入大量資金，我們嚴謹的方法注重投資和回報。

In our GAAP numbers, net loss attributable to Baidu was CNY 6.4 billion, which included a noncash impairment loss of CNY 8.9 billion in total other loss. In the fourth quarter of 2015, following a transaction where we exchanged shares of our majority-owned subsidiary Qunar for a minority investment in Trip.com, we deconsolidated Qunar, recorded investment into Ctrip.com at the closing-date market value and recognized a non-cash accounting gain of CNY 24.4 billion.

根據我們的 GAAP 數據，歸屬於百度的淨虧損為 64 億元人民幣，其中包括 89 億元人民幣的非現金減損損失。2015年第四季度，我們將控股子公司去哪裡的股份換成了Trip.com的少數股權，之後我們將去哪裡拆分，按照收盤市值入賬對攜程的投資，並確認了人民幣244億元的非現金會計收益。

Since then, the market value of Trip.com shares have declined, and the continued low market price has caused us to recognize a noncash impairment loss of CNY 8.9 million in the third quarter, which was determined other than temporary. In October 2019, we sold down our holding in Trip.com, which decreased from approximately 19% to over 12% of Trips.com's outstanding shares.

此後，攜程股票市值持續下跌，持續低迷的市場價格導致我們在第三季確認了 890 萬元人民幣的非現金減損損失，該損失並非暫時性損失。2019年10月，我們減持了Trip.com的股份，佔Trips.com流通股的比例從約19%降至12%以上。

Let me quickly go over the rest of the financial highlights.

讓我快速回顧一下其餘的財務亮點。

Turning to cost of sales. Excluding stock compensation and intangible asset amortization, cost of sales was CNY 16.2 billion, up 15% year-over-year. Bandwidth and depreciation cost increased primarily due to robust growth of our cloud business and increased video consumption, while cost of goods sold increased primarily from the sales increase in Xiaodu smart speakers. TAC increased 5% year-over-year as a result of higher TAC prices expansion into connected off-line screens and other areas.

轉向銷售成本。不包括股票薪酬和無形資產攤銷，銷售成本為 162 億元，年增 15%。頻寬和折舊成本的增加主要由於我們的雲端業務的強勁成長和視訊消費的增加，而銷售成本的增加主要由於小度智慧音箱的銷售增加。由於 TAC 價格上漲以及向連網離線螢幕和其他領域的擴張，TAC 年比成長 5%。

SG&A expenses, excluding stock compensation, were CNY 4.3 billion, down 15% year-over-year, primarily due to the decrease in channel and promotional marketing as less marketing spending met our stringent ROI criteria. The decrease in marketing spending has hampered the sequential growth of our apps, including Haokan short video and Quanmin flash video. We will continue to manage our marketing dollars with a strong discipline toward investment return while recognizing that our marketing investments may not provide a return in the same quarter that the expense was incurred.

銷售、一般及行政費用（SG&A）為人民幣 43 億元，年減 15%，主要由於較少的營銷支出滿足了我們嚴格的投資回報率標準，導致渠道和促銷營銷減少。行銷支出的減少阻礙了我們應用程式（包括好看短片和全民flash影片）的連續成長。我們將繼續嚴格管理我們的行銷資金，追求投資回報，同時也意識到我們的行銷投資可能無法在發生費用的同一季度帶來回報。

R&D expenses, excluding stock compensation, were CNY 3.9 billion, up 18% year-over-year, primarily due to increased personnel expenses, particularly for AI development.

研發費用（不含股票薪酬）為 39 億元，年增 18%，主要由於人員支出增加，特別是人工智慧開發費用增加。

Non-GAAP operating income was CNY 3.7 billion, and non-GAAP operating margin was 13% compared to 7% last quarter. Non-GAAP operating income for Baidu Core was CNY 6.2 billion or USD 871 million. And non-GAAP operating margin for Baidu Core reached 30% in the third quarter compared to 18% last quarter.

非美國通用會計準則營業收入為37億元人民幣，非美國通用會計準則營業利益率為13%，上季為7%。百度核心的非美國通用會計準則營業收入為 62 億元或 8.71 億美元。第三季度，百度核心的非美國通用會計準則營業利潤率達到 30%，而上季為 18%。

Income tax expense was CNY 934 million compared to CNY 2.1 billion in the same quarter last year. Income tax expense in the third quarter included a tax withholding for potential dividend distribution to offshore entities.

所得稅費用為 9.34 億元，去年同期為 21 億元。第三季的所得稅費用包括對離岸實體潛在股利分配的預扣稅。

Non-GAAP net income attributable to Baidu was CNY 4.4 billion, and non-GAAP net margin was 16%. Non-GAAP net income attributable to Baidu Core was CNY 6.3 billion or USD 883 million. Non-GAAP net margin for Baidu Core was 30% compared to 24% last quarter.

非美國通用會計準則下歸屬於百度的淨利為44億元人民幣，非美國通用會計準則下淨利率為16%。非美國通用會計準則下，歸屬於百度核心的淨利潤為 63 億元或 8.83 億美元。百度核心的非美國通用會計準則淨利潤率為 30%，而上一季為 24%。

As of September 30, 2019, cash and short-term investments was CNY 137.4 billion or USD 19.2 billion. Excluding iQIYI, cash and short-term investments for Baidu Core was CNY 123.5 billion or USD 17.3 billion.

截至2019年9月30日，現金及短期投資為人民幣1,374億元，約192億美元。不計愛奇藝，百度核心的現金和短期投資為1235億元或173億美元。

Free cash flow was CNY 7.6 billion, and free cash flow for Baidu Core was CNY 7.5 billion or USD 1 billion. Total full-time equivalent of Baidu Core was approximately 30,300.

自由現金流為人民幣 76 億元，百度核心自由現金流為人民幣 75 億元或 10 億美元。百度核心全職員工總數約3萬人。

Turning to fourth quarter guidance. We expect total revenue to be between CNY 27.1 billion and CNY 28.7 billion, representing a minus 1% to 6% increase year-over-year. Our guidance assumes Baidu Core revenue will grow between 0% to 6% year-over-year.

轉向第四季指引。我們預計總收入將在 271 億元至 287 億元人民幣之間，年增 -1% 至 6%。我們的預測是，百度核心營收將年增 0% 至 6%。

These forecasts are our current and preliminary view and are subject to change.

這些預測是我們目前的初步觀點，可能會改變。

Before I turn the call over to the operator, let me recap Baidu's third quarter results.

在將電話轉給接線員之前，請容許我回顧一下百度第三季的業績。

- Baidu's search and feed business is making great progress. Baidu App traffic remains strong as we expand Baidu's mobile ecosystem centering around information and knowledge and improve user experience with mobile pillars, including BJH accounts, smart mini program and Managed Page.

- 百度的搜尋和資訊流業務正在取得巨大進展。隨著我們擴展百度以資訊和知識為中心的行動生態系統，並透過 BJH 帳戶、智慧小程式和託管頁面等行動支柱改善用戶體驗，百度應用程式流量保持強勁。

- Our monetization capabilities are strengthening with Baidu's hosted marketing platform and expansion of our monetization products, such as oCPX for search.

- 隨著百度託管行銷平台和貨幣化產品（如用於搜尋的 oCPX）的擴展，我們的貨幣化能力正在增強。

- Baidu's revenues for the third quarter was higher than the midpoint of our original expectations, with upside coming mainly from Baidu Core. Looking into the fourth quarter, we expect Baidu Core revenues to grow on a year-over-year basis.

- 百度第三季的營收高於我們最初預期的中位數，成長主要來自「百度核心」。展望第四季度，我們預期百度核心營收將年增。

- On the cost side, our disciplined approach to managing resources and focusing on investment returns coupled with the strengthening of Baidu's mobile ecosystem allowed us to deliver significant margin improvement sequentially. Adjusted EBITDA margin for Baidu Core reached 36% in the third quarter, up 1,200 basis points sequentially.

- 在成本方面，我們採取了嚴格的資源管理方法，注重投資回報，再加上百度移動生態系統的加強，使我們的利潤率環比大幅提高。第三季度，百度核心調整後EBITDA利潤率達36%，季增1200個基點。

- As of October 31, 2019, we have returned approximately USD 1.2 billion to our shareholders, USD 778 million under the 2018 Share Repurchase Program, which expired in June this year, and USD 397 million under the 2019 Share Repurchase Program.

- 截至 2019 年 10 月 31 日，我們已向股東返還約 12 億美元，其中根據今年 6 月到期的 2018 年股票回購計劃返還 7.78 億美元，根據 2019 年股票回購計劃返還 3.97 億美元。

Operator, with that, let's open the call to questions.

接線員，好了，讓我們開始提問。

(Operator Instructions) Your first question comes from line of Alicia Yap from Citigroup.

（操作員指示）您的第一個問題來自花旗集團的 Alicia Yap。

Congrats on the improving results. My question is related to the priority in the overall strategic initiative and also the investment spend. So can management share with us as we look out into the next 1 to 2 years on the various strategic initiative, like the smart mini program, Managed Page, the DuerOS and the Apollo autonomous system and the cloud computing, what are the must be better among these? If you could share with us in terms of the rankings of importance and in terms of the future revenue contribution in the orders of the ranking. As well as on the budget spend in terms of dollar amount, what are the percentage of the total spend if you can rank for us some of those initiatives?

恭喜成績不斷進步。我的問題與整體策略措施的優先順序以及投資支出有關。那麼管理層能否與我們分享一下未來 1 到 2 年內各種策略舉措，例如智慧小程式、託管頁面、DuerOS 和 Apollo 自動駕駛系統以及雲端運算，其中哪些是必須改進的？如果您能與我們分享重要性排名以及排名順序中未來收入貢獻的排名。除了美元金額的預算支出外，如果您能為我們排名其中一些計劃，它們佔總支出的百分比是多少？

And then just lastly on the strategic equity stake that you own, could you comment or share with us if online travel is still considered as strategic for Baidu? Or is that okay if Baidu doesn't have to necessarily own the equity stake in the future?

最後，關於您所持有的策略股權，您是否可以評論或與我們分享線上旅遊是否仍被視為百度的策略重點？或者說，如果百度未來不一定擁有股權，那也可以嗎？

Alicia, this is Robin. I think our strategy has not changed very much. Our core business, which is the Baidu mobile ecosystem, centered around search and feed, is very much a knowledge- and information-based mobile ecosystem, and we're leading in this part in China. Using the pillars like Baijiahao, smart mini program and Managed Page, we are fostering a healthier and stronger ecosystem, and this will continue to be the highest priority for Baidu. As our experiences in the Baidu mobile ecosystem continue to improve, we do not have to spend as much money to buy traffic as before. So that's one of the reasons you see the margin improving on a quarter-over-quarter basis.

艾莉西亞，這是羅賓。我認為我們的策略沒有太大改變。我們的核心業務是百度行動生態系統，以搜尋和資訊流為中心，是一個以知識和資訊為基礎的行動生態系統，我們在中國這一領域處於領先地位。利用百家號、智慧小程式和託管頁面等支柱，我們正在培育一個更健康、更強大的生態系統，這將繼續成為百度的首要任務。隨著我們在百度行動生態系統中的體驗不斷提升，我們不需要像以前那樣花那麼多錢來購買流量。這就是利潤率逐季提高的原因之一。

And going forward, we think there are still a lot of things to do in the mobile ecosystem area, and we will continue to innovate and provide a better and different user experience than the industry peers in China.

展望未來，我們認為在行動生態系統領域還有很多事情要做，我們將繼續創新，提供比中國業內同行更好、更與眾不同的用戶體驗。

And on the AI-enabled new businesses, we think all are very promising. And DuerOS, we think we are the very clear leader in the conversational AI space. It has cost us a lot of money in the past, but going forward, I think the overall loss will continue to narrow for the next 1 or 2 years.

對於人工智慧賦能的新業務，我們認為都非常有前景。我們認為，DuerOS 是對話式人工智慧領域的領導者。過去這讓我們損失了很多錢，但展望未來，我認為未來1到2年整體損失將會繼續縮小。

On Apollo, it's morphing into more like a smart transportation total solution because most of the Chinese cities are very keen to work with us and improve their transportation infrastructure.

對於阿波羅來說，它正在逐漸演變成一個智慧交通整體解決方案，因為大多數中國城市都非常渴望與我們合作並改善他們的交通基礎設施。

Cloud is more generic, and we strive to leverage our AI capabilities to grow market share in areas that we are good at.

雲端更加通用，我們努力利用我們的人工智慧能力來擴大我們擅長領域的市場份額。

And for travel, I think we are still very committed to partner with Trip.com. And we are continuing to work closely with them on all fronts within our mobile ecosystem as well as with our AI capabilities.

對於旅行，我認為我們仍然非常致力於與Trip.com合作。我們將繼續在行動生態系統以及人工智慧領域的各個方面與他們密切合作。

Your next question comes from the line of Piyush Mubayi from Goldman Sachs.

您的下一個問題來自高盛的 Piyush Mubayi。

Robin and Herman, just looking at the revenue line, could you take us through how you get a 25% traffic growth versus the revenue growth rate that you've seen both on a year-on-year basis as well as on a sequential basis? And as we look into 2020, could you take us through, potentially, quarter by quarter the sort of time frame that would take for recovery in the key verticals that have monetized very well in the past? That's my first question.

羅賓和赫爾曼，僅從營收來看，您能否向我們介紹如何實現 25% 的流量成長，以及與去年同期和上一季的營收成長率相比如何？展望 2020 年，您能否逐季向我們介紹過去獲利狀況良好的關鍵垂直產業復甦所需的時間框架？這是我的第一個問題。

And second, looking at how well you've managed costs, it's been a very, very strong show. Over the last 2 quarters, your TAC is down from 18.2% to 15.4% of core revenue. Bandwidth cost down to 6.8% from 8.7%. SG&A has calmed down very nicely. Can we expect these trends to continue into the fourth quarter and 2020?

其次，從你們的成本管理能力來看，這是一場非常非常優秀的演出。在過去兩個季度中，您的 TAC 從核心收入的 18.2% 下降到 15.4%。頻寬成本從 8.7% 降至 6.8%。銷售、一般及行政開支 (SG&A) 已平穩下來。我們是否可以預期這些趨勢將持續到第四季和 2020 年？

Okay. I'll answer your first question, and Herman will answer the second one. On the first, I think because we continue to improve the user experience for Baidu App and we also try to direct users from third-party browser to the Baidu App, we've seen strong traffic growth of our in-app search where users get much better experience. So there's going to be a virtuous circle for this kind of user behaviour.

好的。我來回答你的第一個問題，赫爾曼來回答第二個問題。首先，我認為因為我們不斷改善百度應用程式的用戶體驗，並且我們還嘗試將用戶從第三方瀏覽器引導到百度應用程序，所以我們的應用程式內搜尋流量增長強勁，用戶可以獲得更好的體驗。所以這種使用者行為將會形成良性循環。

And the disparity between traffic growth and revenue growth is that we basically explained all the headwinds, industry-specific regulations, self-enforced discipline in certain industries like health care and macro. We also think that we need to improve our self-management system. So this thing, I think, will be temporary, and we're also seeing the macro environment stabilizing. So we do think that, eventually, the revenue will catch up with this traffic.

流量成長和收入成長之間的差異是我們基本上解釋了所有的阻力、行業特定的法規、醫療保健和宏觀等某些行業的自我強制紀律。我們也認為我們需要完善自我管理體系。所以我認為這種情況將是暫時的，我們也看到宏觀環境正在穩定下來。因此我們確實認為，最終收入將會追上流量。

Yes, the question with regards to our cost structure, I think when you look into Q4, I think we said 2 things. We said that from Q2 to Q3 sequentially, we're able to increase our non-GAAP operating margin and net margin for 2 reasons. One is the operational efficiency, and Robin talked about that. With the stronger mobile ecosystem, users are stickier, they're coming more for better technology searches and so forth. So that's helping us. And the second factor is our cost management initiatives that we've implemented. Obviously, these types of factors would be able to carry through going forward.

是的，關於我們的成本結構的問題，我想當你研究第四季時，我們說了兩件事。我們說過，從第二季到第三季度，我們能夠連續提高非公認會計準則營業利潤率和淨利潤率，原因有二。一是營運效率，Robin 也談到了這一點。隨著行動生態系統的增強，使用者的黏性更強，他們會更多地尋求更好的技術搜尋等等。所以這對我們有幫助。第二個因素是我們實施的成本管理措施。顯然，這些類型的因素將會繼續發揮作用。

So when we look at for example Q4, I expect we would have a similar impact as we did at Q3, meaning that margin should be similar to Q3 if not better. We continue to look at other areas where we can implement cost management initiatives, and we'll also continue to focus on operational efficiency.

因此，當我們以第四季為例時，我預計我們會產生與第三季類似的影響，這意味著利潤率應該與第三季相似，甚至更好。我們將繼續研究可以實施成本管理措施的其他領域，並且我們也將繼續關注營運效率。

Your next question comes from the line Eddie Leung from BoA ML.

您的下一個問題來自美國銀行 ML 的 Eddie Leung。

Two quick questions. The first one is about the advertising industries. Could you remind us the top advertising industries? And especially, could you comment on the recent outlook?

兩個簡單的問題。第一個是關於廣告業。能提醒我們一下頂級廣告業嗎？特別是，您能評論一下最近的前景嗎？

And then secondly, just a follow-up question perhaps on Piyush's question about cost control. One thing that has been a bit volatile in the past is the sales and marketing costs in the first quarter depending on any major branding campaign. So any color on the upcoming first quarter would be great.

其次，也許只是針對 Piyush 關於成本控制的問題的後續問題。過去有一點不穩定，那就是第一季的銷售和行銷成本取決於任何重大的品牌推廣活動。因此，即將到來的第一季的任何顏色都會很棒。

Eddie. Yes, in our prepared remarks we talked about the industries that we think we are doing well. I mentioned that education (inaudible) retail, e-commerce and service sectors did well, this is an area that we've historically done well. I think the fact is that we're now enabling closed-loop transactions in Baidu App, we're able to allow people who come on our platform to do marketing services with the closed-loop experience, so that you can see continued improvement in conversion, and it helps with our revenue growth and the overall effectiveness of marketing. Service sectors, we historically have done well. So those are kind of the trends that we're seeing.

艾迪。是的，在我們準備好的發言中，我們談到了我們認為做得好的行業。我提到教育（聽不清楚）零售、電子商務和服務業表現良好，這是我們歷史上表現良好的領域。我認為事實是，我們現在在百度App中實現了閉環交易，我們能夠讓來到我們平台的人以閉環的體驗來做營銷服務，這樣你就能看到轉化率的持續提高，這有助於我們的收入增長和整體營銷效果的提高。服務業方面，我們歷來表現良好。這些就是我們所看到的趨勢。

In regards to the first quarter. I think first quarter historically has been the lowest quarter seasonality for us if you look at the last few years. So we expect from Q4 into Q1 a down quarter because of, basically, seasonality. Q4, we're going to have a strong strength probably from e-commerce, retail and so forth, the Double 11 celebration and so forth. And then in the first quarter, you're going to have a Chinese New Year. And so that kind of change, we're going to expect down. Historically, it's down in the teens from Q4 to Q1, and we'll have better view of this as we progress and get closer to Q1.

關於第一季。如果回顧過去幾年，我認為第一季是我們的季節性最低的季度。因此，我們預計從第四季到第一季將出現下滑，主要是因為季節性因素。第四季度，我們將從電子商務、零售等、雙十一慶祝活動等方面獲得強勁成長。然後在第一季度，你們將迎來中國新年。因此，我們預計這種變化將會減少。從歷史上看，從第四季度到第一季度，這一數字一直在下降，隨著我們不斷進步並接近第一季度，我們將對此有更好的了解。

Herman, is there any major branding campaign planned for the Chinese New Year in 2020?

赫爾曼，2020 年農曆新年有沒有什麼大型品牌推廣活動計畫？

So far, we haven't finished planning for Q1. We've actually just started our planning for 2020. So right now, we don't see particularly major. Although historically, as you saw last year, there was such campaigns with CCTV and so forth. I think that we'll probably know better probably in a month or so once we are midway into our 2020 planning. But I think that, typically, we're very strong with mobile, and during Chinese New Year, that's where mobile traffic is stronger relatively to PC. And that's really an opportunity for us to show the world the things like the great products that we have in our MEG and our SLG and so forth. So that's something we'll be considering, but we'll have probably more information in a month or so.

到目前為止，我們還沒有完成第一季的規劃。實際上，我們剛開始製定 2020 年的計劃。因此目前我們還沒有看到特別重大的情況。儘管從歷史上看，正如您去年所看到的，有利用中央電視台等開展的此類活動。我認為，當我們進入 2020 年規劃的中期時，大概一個月後我們就會知道更多。但我認為，通常我們在行動端表現非常強勁，而在農曆新年期間，行動端流量相對於 PC 端而言更為強勁。這確實是一個機會，讓我們向世界展示我們在 MEG 和 SLG 等方面的優秀產品。所以這是我們正在考慮的事情，但我們可能會在一個月左右獲得更多資訊。

Your next question comes from the line of Ming Zhao from 86Research.

您的下一個問題來自 86Research 的 Ming Zhao。

I'm asking a question on behalf of our analyst, Xueru Zhang. So management, I think, Robin, you have talked about a lot of the exciting developments at Baidu, and it's also great to see some stabilization of revenue quarter-over-quarter in the business. So we want to maybe ask you to comment on if you see any major challenges for Baidu because we feel so many opportunities at Baidu. So what are the major challenges do you see for Baidu these days?

我代表我們的分析師張雪茹提出一個問題。所以管理層，羅賓，我認為您已經談到了百度很多令人興奮的發展，並且很高興看到業務收入逐季度趨於穩定。因此，我們想請您評論一下，您是否認為百度面臨任何重大挑戰，因為我們覺得百度有很多機會。那麼您認為目前百度面臨的主要挑戰是什麼？

And the second question is, Herman, you commented a little bit about the different verticals' performance right now. Can you expand it a little bit more to include verticals like auto, finance, real estate, travel, those verticals, so we can have a clear idea about the vertical performance? Especially, can we say the health care and brand advertising segments have bottomed? Because I think those are the 2 big draggers for the business.

第二個問題是，赫爾曼，您對不同垂直行業目前的表現做了一些評論。您能否將其進一步擴展，包括汽車、金融、房地產、旅遊等垂直行業，以便我們能夠清楚地了解垂直行業的表現？尤其是，我們能否說醫療保健和品牌廣告領域已經觸底？因為我認為這是拖累業務的兩大因素。

Yes, I think we have 2 major challenges. One is on the mobile side. As many of you know, a lot of the large mobile apps are very much a closed ecosystem. So it's not easy for us to index every piece of content as we did during the PC era. So what we are trying to do is to build our own mobile ecosystem so that content and services can be more native to the Baidu ecosystem. I think although these are the challenges, but these are also opportunities.

是的，我認為我們面臨兩大挑戰。一個是移動端。眾所周知，許多大型行動應用程式都是一個封閉的生態系統。因此，我們不再像 PC 時代那樣輕鬆地對每一條內容進行索引。因此，我們正在嘗試建立自己的行動生態系統，以便內容和服務能夠更原生地適應百度生態系統。我認為雖然這些都是挑戰，但這些也是機會。

Once we can build a healthy and strong mobile ecosystem, the user experience will be more indigenous, meaning that they get better experience, and our customers expect better conversion. We are in the process of transitioning. So that's why you see that traffic, probably, a leading indicator that is growing, but the revenue side or the monetization side has not picked up that significantly. So going forward, we are continuing to push on the mobile ecosystem, in fact, with all of our organically built content and services.

一旦我們能夠建立一個健康且強大的行動生態系統，使用者體驗將更加本土化，這意味著他們獲得更好的體驗，我們的客戶也期待更好的轉換。我們正處於轉型期。所以這就是為什麼你會看到流量（可能是一個領先指標）在成長，但收入方面或貨幣化方面卻沒有顯著成長。因此，展望未來，我們將繼續推動行動生態系統的發展，事實上，我們將利用我們所有有機建構的內容和服務。

And on the AI side, I think that the main challenge is that the market does not grow as fast as some would expect. So that's why we still need to continue to invest in this kind of new initiatives and waiting for the market to become more mature so that we will be able to profit from that.

在人工智慧方面，我認為主要的挑戰是市場成長速度不如一些人預期的那麼快。所以這就是為什麼我們仍然需要繼續投資這類新措施並等待市場變得更加成熟，以便我們能夠從中獲利。

Okay. And let me talk a little bit more about our revenue makeup. With regards to verticals that you talked about, auto and financial services, those are both down, right? Automobile, as we know, the number of car unit sales this year is down. If you look at the industry, it's not doing as healthy. If you look at financial services, that's another area that, since Q1 this year, that has been down, and this has been down pretty significantly.

好的。讓我再多談談我們的收入組成。至於您談到的垂直行業，汽車和金融服務，這兩個行業都在下滑，對嗎？汽車，眾所周知，今年汽車銷量下降。如果你看一下這個產業，你會發現它的發展沒那麼健康。如果你看一下金融服務，你會發現這是另一個自今年第一季以來一直下滑的領域，而且下滑幅度相當大。

On travel, we've been focusing on building better products. We have good content. We have a strategic relationship with Trip.com and so forth. And so travel overall has done well. It's one of our stronger verticals.

在旅行方面，我們一直致力於打造更好的產品。我們有好的內容。我們與Trip.com等建立了策略合作關係。因此，旅遊業整體表現良好。這是我們實力較強的垂直領域之一。

With regards to health care. If you look at health care, we started introducing Managed Page last December. And at the end of March this year, we required that everyone who's doing advertising in mobile on Baidu to switch over their H5 sites to our Managed Page. And that has put a damper in terms of revenue on those who would probably have put quality content. Customers just will not come to Baidu. And then because we now have stronger control of the content that's on there and so forth, we are putting emphasis on ensuring that the content on our pages are good for our users. And we started then rolling out on to PC, which is less than 20% of total health care revenues, in July. So in Q3, really, it's a partial quarter hit. Q4, you'll see a full quarter hit. So we actually have seen most customers who are switching over have switched over. So we don't see too much of a difference from Q3 into Q4. We're halfway through the quarter. So as of right now, we don't see too much difference from Q3 to Q4.

關於醫療保健。如果你有在關注醫療保健，我們從去年 12 月開始推出託管頁面。今年三月底，我們要求所有在百度行動裝置上做廣告的商家，將他們的H5網站轉移到我們的託管頁面。這對於那些可能提供優質內容的人來說，收入受到了影響。客戶根本不會來百度。而且，由於我們現在對網頁內容等有了更強的控制力，因此我們更加重視確保網頁內容對使用者有益。從 7 月開始，我們開始向個人電腦市場推廣，這部分收入佔醫療保健總收入的 20% 以下。因此，在第三季度，這實際上是一個部分季度的打擊。Q4，你會看到整個季度的衝擊。因此，我們實際上已經看到大多數轉換的客戶已經轉換過來了。因此，我們認為第三季和第四季之間不會有太大差異。本季已過一半。因此截至目前，我們還沒有看到第三季和第四季有太大的差異。

But if you look at it overall, our revenue guidance for Baidu Core this quarter, the last few quarters, we had more uncertainties, and we started with a range of negative percentage. And this quarter, now we're guiding from 0% to 6%. So we think that in terms of year-over-year growth, we're much better off in the last couple of quarters. I think in May, we said that we'd come back with a 100-day plan. We executed very well from both top line and bottom line. And so you see our business getting more solid and that the products that we talked about, the hosted marketing platforms with the strengthening mobile ecosystem, so that's helping us, I think, fight the current softer macroeconomic environment.

但如果從整體來看，我們對本季百度核心的收入預期，以及過去幾季的預期，存在更多不確定性，我們從負百分比範圍開始。本季度，我們的預期是 0% 至 6%。因此，我們認為，就同比成長而言，過去幾季我們的表現要好得多。我記得在五月份，我們說過我們會帶著一個 100 天計劃回來。我們從營收和利潤兩方面都表現得非常出色。因此，您會看到我們的業務變得更加穩固，而且我們談論的產品、託管行銷平台以及不斷加強的行動生態系統，我認為這有助於我們應對當前較為疲軟的宏觀經濟環境。

Your next question comes from the line of Gregory Zhao from Barclays.

您的下一個問題來自巴克萊銀行的 Gregory Zhao。

The first one is, so if we look at your TAC and your SG&A expense, so we're going to see a significant year-over-year and q-on-q decrease. So I just want to understand the trends going forward and the sustainability of the trend.

第一個是，如果我們看一下您的 TAC 和 SG&A 費用，我們將看到同比和環比顯著下降。所以我只是想了解未來的趨勢以及趨勢的可持續性。

And also, one more thing is the volume of your search query of the Baidu within the native app, I think last quarter, you mentioned it's 20% year-over-year. So do we have any update for this quarter? And also, I want to understand the query volume, the growth in the third party, the mobile browser and also on PC.

另外，還有一件事是您在原生應用程式中對百度的搜尋查詢量，我記得上個季度您提到它同比增長了 20%。那麼本季有什麼更新嗎？另外，我想了解查詢量、第三方、行動瀏覽器和 PC 的成長情況。

Greg, yes, so with regards to the 2 expense items, we talked about TAC. TAC still grew 5% year-over-year. I think TAC's growth rate has levelled off. It's growing slower year-over-year than our previous quarter. I think a couple of things. Number one is as we focus more on building our mobile ecosystem, we're going to be relying more on in-app searches to grow our revenue. And we've been transitioning off this, I think, over the last year. I think The Street misinterpreted our strategy to move over into in-app services because in-app services we are required to pay for channel costs upfront and then you would have revenues over the following quarters. When we look at the user lifetime with TAC, every dollar you spend get that revenue in that same quarter. So as our business model shifted, margin shifted, and The Street took, I think, several quarters to understand that. So I think that's one issue. And I think overall so far, I think we are having still increasing other costs. I think TAC price is still increasing, but I think it's not hitting us as bad on margin as the previous quarters.

格雷格，是的，關於這兩項費用，我們討論了 TAC。TAC 仍比去年同期成長 5%。我認為 TAC 的成長率已經趨於平穩。與上一季相比，其年成長速度較慢。我想到幾件事。首先，隨著我們更加重視建構行動生態系統，我們將更依賴應用程式內搜尋來增加收入。我認為，在過去的一年裡，我們已經在逐步擺脫這種狀況。我認為華爾街誤解了我們進軍應用程式內服務的策略，因為應用程式內服務需要我們預先支付通路成本，然後才能在接下來的幾季獲得收入。當我們透過 TAC 來觀察用戶生命週期時，你花費的每一美元都會在同一季度產生相應的收入。因此，隨著我們的商業模式發生變化，利潤率也發生了變化，我認為華爾街花了幾個季度的時間才明白這一點。所以我認為這是一個問題。我認為總體而言，到目前為止，我們的其他成本仍在增加。我認為 TAC 價格仍在上漲，但我認為它對我們的利潤率的打擊不像前幾季那麼嚴重。

With sales and marketing, as Robin mentioned, we were still spending heavily on sales and marketing. But on a year-over-year basis, we're down for sales and marketing plus G&A. I think we mentioned in our prepared remarks how much we spent for channel and promotional marketing is a function of investment return. Although we don't expect every dollar we spend to get a return in the same quarter, we would measure over the lifetime value of the users. So as the economy softens and we're seeing the returns are not meeting the internal threshold that we had set, then we'll tone it back. So that's why as we tone it back, you can see, for example, Baidu App is actually quite profitable because it's a good segment of our overall business.

正如羅賓所提到的，在銷售和行銷方面，我們仍然在銷售和行銷上投入大量資金。但與去年同期相比，我們的銷售、行銷以及一般行政費用均有所下降。我想我們在準備好的發言中提到過，我們在通路和促銷行銷上花了多少錢取決於投資回報。雖然我們不期望我們花費的每一美元都能在同一季度獲得回報，但我們會衡量用戶的終身價值。因此，當經濟疲軟並且我們看到回報未達到我們設定的內部門門檻時，我們就會調整政策。因此，當我們調整一下時，你可以看到，例如，百度應用程式實際上是相當有利可圖的，因為它是我們整體業務的一個重要部分。

So I think with the economy like this, we'll be more careful in terms of spending. We're looking for a return that we can get. But as the economy gets better and we're seeing good returns, we might increase that in the future. But ultimately, we think that whatever we spend, we get the return back because we have a very sophisticated system internally to measure these kind of returns to the channel for promotional marketing.

所以我認為，在這樣的經濟狀況下，我們在支出方面會更加謹慎。我們正在尋求可以獲得的回報。但隨著經濟好轉，我們看到了良好的回報，我們將來可能會增加這個數字。但最終，我們認為無論我們花費多少，我們都會獲得回報，因為我們內部有一個非常複雜的系統來衡量促銷行銷管道的這些回報。

Gregory, this is Dou. For the search volume, actually, the total mobile search volume, we still see a very good lift year-over-year. And specifically, for the in-app search, as Robin mentioned in the prepared remarks, actually, we saw a 25% year-over-year lift. So given the better experience in Baidu App search with Baijiahao, smart mini programs and Managed Pages all together, the experience is getting better, measured by all the metrics we are using. Given that, we are going to see the momentum continue in terms of the in-app search traffic in total.

格雷戈里，這是竇。就搜尋量而言，實際上，就總行動搜尋量而言，我們仍然看到同比增長非常顯著。具體來說，對於應用程式內搜索，正如羅賓在準備好的發言中提到的那樣，實際上，我們看到了 25% 的同比增長。因此，考慮到百度應用程式搜尋透過百家號、智慧小程式和託管頁面的結合而帶來的更好體驗，根據我們使用的所有指標來衡量，體驗正在變得越來越好。有鑑於此，我們將看到應用程式內搜尋流量整體上持續保持成長動能。

Your next question comes from the line of Grace Chen from Morgan Stanley.

您的下一個問題來自摩根士丹利的 Grace Chen。

My question is also about the online marketing business. It's good to hear that the management talked about the business environment's overall stabilizing. But can you also elaborate a bit more about the outlook into 2020, specifically from a demand and supply side? The demand side, can you elaborate more about your observations about macro and ad budget for the next year? And from the supply side, can you give specific comment about the competition environment? Because I remember we talked about the app inventory supply increase earlier this year. And how do you see that competitive environment will evolve into the next year? So that's my first question.

我的問題也是關於網路行銷業務的。很高興聽到管理階層談到商業環境整體趨於穩定。但是，您能否進一步闡述 2020 年的前景，特別是從需求和供應方面來看？需求方面，您能否詳細說明一下對明年宏觀和廣告預算的觀察？從供應方面來看，您能否具體評估一下競爭環境？因為我記得我們今年早些時候討論過應用程式庫存供應增加。您認為明年的競爭環境將如何演變？這是我的第一個問題。

And second question is about 5G. How do you expect the 5G opportunities will change? Or what kind of impact will that be to the overall Internet business?

第二個問題是關於5G的。您預計5G機會將發生怎樣的變化？或是對整個網路業務會產生什麼樣的影響？

Yes, on the demand side, I think, as I mentioned, overall, we are seeing signs of stabilization, which means it's not getting worse. As we actually build a more solid and user-friendly mobile ecosystem, we would all be able to gradually get back the advertising budgets. And on the supply side, there has been a sudden flash of new app inventories over the past year or so. We see that kind of speed of increase slowing down, so that is also kind of good for us. But ultimately, we focus on our own strengths, building the best mobile ecosystem for knowledge and information, therefore, we can provide unique value to our customers and advertisers. The initiatives we talked about during the prepared remarks all resulted in better conversion for our customers. Because the main stream of our revenues are basically pay for performance, as long as we can continue to improve the performance, we will be able to get more budget from our customers.

是的，在需求方面，我認為，正如我所提到的，總體而言，我們看到了穩定的跡象，這意味著情況並沒有變得更糟。隨著我們真正建立出更穩固、更用戶友好的行動生態系統，我們將能夠逐步收回廣告預算。而在供應方面，過去一年左右，新的應用程式庫存突然激增。我們看到這種成長速度正在放緩，這對我們來說也是好事。但最終，我們專注於自身的優勢，建立最佳的知識和資訊移動生態系統，從而為我們的客戶和廣告商提供獨特的價值。我們在準備好的發言中談到的舉措都為我們的客戶帶來了更好的轉換。因為我們的收入主要來自績效付費，只要我們能持續提升績效，就能從客戶身上獲得更多的預算。

And for 5G, I think that will give us more opportunities to innovate in a lot of fronts. On the mobile side, I think the video product features will continue to evolve, and it could be very different from what we see today. And on the AI2B side, smart transport transportation, smart manufacturing, education, in fact, we see opportunities to transform those business models in all kinds of different areas and industries.

對於 5G，我認為這將為我們在許多方面提供更多創新的機會。在行動端，我認為視訊產品功能將繼續發展，並且可能與我們今天看到的有很大不同。在AI2B方面，智慧交通、智慧製造、教育，事實上，我們看到了在各種不同領域和產業轉變這些商業模式的機會。

Your next question comes from the line of Binnie Wong from HSBC.

您的下一個問題來自匯豐銀行的 Binnie Wong。

My question is on if we can dissect into the traffic growth of the 25%. How do you see the drivers coming from search, feeds and video just so that we can better understand that in terms of like how you see that will trend? And also, when do you see that can translate into faster revenue growth because we actually see our 4Q outlook is an acceleration from past few quarters? So I just wanted to see how we should see that maybe seeing the upside on feeds and video can translate into faster growth there.

我的問題是，我們是否可以分析一下 25% 的流量成長。您如何看待來自搜尋、資訊流和影片的驅動因素，以便我們能夠更好地理解您認為的趨勢？而且，您認為什麼時候可以轉化為更快的收入成長，因為我們實際上看到我們的第四季度前景比過去幾個季度有所加速？所以我只是想看看我們應該如何看待資訊流和影片的優勢，從而實現更快的成長。

And then also, second question is also in the opening of the press release. I think Robin mentioned that your in-app search has really also gained market share. Can you comment on user behaviour in terms of search usage as we see rising competition from newsfeed platform launching their search function earlier and also, of course, against the largest social network also people searching within the moment? So can you comment on those?

第二個問題也在新聞稿的開頭。我認為羅賓提到過，您的應用程式內搜尋確實也獲得了市場份額。我們看到，新聞推送平台的競爭日益激烈，它們紛紛提前推出搜尋功能，當然，最大的社交網路也面臨著即時搜尋的競爭，您能否對用戶的搜尋使用行為進行評論？那麼您能對此發表評論嗎？

Okay. For the video question, actually, it's right. There has been an explosive growth in China's short video sectors in recent years. But we believe that it's far from being over yet. Actually, for us, we distributed short videos not only through our video apps but also through the Baidu App. So actually, in Robin's prepared remarks, he already mentioned that for the short videos, the distribution through Baidu App and video apps, so we see the time spent up to like 35% year-over-year, actually. So not only for the videos itself, like even in search, we see that search satisfied through videos increased almost 50% year-over-year. So put that together, we see video is actually playing a very important role in Baidu's whole ecosystem. Especially with the 5G and over the years, so we're going to see more applications of videos in Baidu's ecosystem.

好的。對於視訊問題，實際上，這是正確的。近年來，中國短片產業呈現爆發式成長。但我們相信，這一切還遠遠沒有結束。實際上，對於我們來說，我們不僅透過我們的視頻應用程式分發短視頻，還透過百度應用程式分發。實際上，在羅賓準備好的發言中，他已經提到，對於短視頻，通過百度應用程序和視頻應用程序進行分發，因此我們看到花費的時間實際上同比增長了 35％。因此，不僅是影片本身，即使在搜尋中，我們也看到透過影片滿足的搜尋量比去年同期成長了近 50%。綜合起來，我們發現影片其實在百度整個生態系統中扮演著非常重要的角色。特別是隨著5G的到來以及未來幾年的發展，我們將在百度的生態系統中看到更多影片的應用。

Let me answer the competition question. I think search has a very high barrier to entry, and --it takes a long time in the user behaviour having formed. So it's not that easy to change user behaviour from a browsing habit to a search habit because for browsing, users do not need to do much, so it's easier to do browsing. If you ask someone to transform from an easier-to-do thing to a harder-to-do thing, that's not that easy. But on the other end, if you want to transform those users who are used to search, who are used to typing or express their needs explicitly to a browsing behaviour, that's much easier. So that's why it's easier for Baidu to do feed, but it's harder for a feed player to do search.

讓我來回答一下比賽問題。我認為搜尋的進入門檻很高，而且用戶行為的形成需要很長時間。因此，將用戶行為從瀏覽習慣轉變為搜尋習慣並不是那麼容易，因為對於瀏覽，用戶不需要做太多，所以瀏覽更容易。如果你要求某人從一件容易做的事情轉變為一件更難做的事情，那並不是那麼容易。但另一方面，如果你想將那些習慣搜尋、習慣打字或明確表達需求的用戶轉變為瀏覽行為，那就容易多了。所以這就是為什麼百度做 feed 比較容易，而 feed 提供者做搜尋比較難。

And on top of that, I think the technology barrier to search is very high. If you can solve the search problem, you basically solve the AGI problem, artificial general intelligence, because whatever the users say, you have to be able to understand that and come up with relevant results, which requires a lot of research, a lot of investment, and it's a very hard problem.

除此之外，我認為搜尋的技術壁壘非常高。如果你能解決搜尋問題，那麼你基本上就解決了 AGI 問題，也就是通用人工智慧，因為無論用戶說什麼，你都必須能夠理解並得出相關結果，這需要大量的研究、大量的投資，這是一個非常困難的問題。

Okay. And just a follow-up here is that in terms of the traffic growth, when do management see that can translate into, potentially, a faster revenue growth and outlook into 2020?

好的。接下來的問題是，就流量成長而言，管理階層何時認為這可以轉化為更快的收入成長和 2020 年的前景？

For the marketing customers, what they really care about is the effective traffic. So with the Managed Pages, smart mini programs, actually, we see more and more examples where the customers, when they use these services, their ROI are being improved. So it's really hard to say how we are going to turn that into numbers, but we do see the trend is going up. And actually, as Robin mentioned in the opening remarks, more and more marketing customers are adopting our Managed Pages, actually. So we are seeing improvement over ROI. That is going to turn into revenue lift, but it's hard to say the specific number.

對於行銷客戶來說，他們真正關心的是有效流量。因此，透過託管頁面和智慧小程序，我們實際上看到越來越多的例子，當客戶使用這些服務時，他們的投資報酬率就提高了。因此，很難說我們如何將其轉化為數字，但我們確實看到趨勢正在上升。事實上，正如羅賓在開場白中提到的那樣，越來越多的行銷客戶正在採用我們的託管頁面。因此，我們看到了投資報酬率的提高。這將會轉化為收入的成長，但很難說出具體的數字。

We are now approaching the end of the conference call. Thank you for your participation in today's conference. You may now disconnect. Good day.

我們現在即將結束電話會議。感謝大家參加今天的會議。您現在可以斷開連線。再會。