Ladies and gentlemen, thank you for standing by, and good evening. Thank you for joining Sohu's First Quarter 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. After management's prepared remarks, there will be a Question-and-Answer session. Today's conference call is being recorded. If you have any objections, you may disconnect at this time. I would now like to turn the conference over to your host for today’s conference call, Mr. Eric Yuan, Investor Relations Director of Sohu. Please go ahead, sir.

Thanks, operator. Thank you for joining us today to discuss Sohu's first quarter 2019 results. On the call are Chairman and CEO, Dr. Charles Zhang; CFO, Joanna Lv. Also with us today are Changyou's CEO, Dewen Chen; and CFO, Yaobin Wang; and Sogou's CEO, Xiaochuan Wang; and CFO, Joe Zhou. Before management begins their prepared remarks, I would like to remind you of the company's Safe Harbor statement in connection with today's conference call. Except for the historical information contained herein, the matters discussed in this conference call are forward-looking statements. These statements are based on current plans, estimates and projections. And therefore, you should not place undue reliance on them. Forward-looking statements involve inherent risks and uncertainties. We caution you that a number of important factors could cause actual results to differ materially from those containing any forward-looking statements. For many information about the potential risks and uncertainties, please refer to the company's filings with the Securities and Exchange Commission, including its registration statements and most recent annual report on Form 20-F. With that, I will now turn the call over to Dr. Charles Zhang. Charles, please proceed.

Thanks. Thank you, everyone for joining our call. In the first quarter, we delivered better-than-expected revenue, mainly driven by the solid performance of our search and game businesses. Sohu Media continued to make progress upgrading its products and content on our platform and we explored new ways to diversify revenue sources. Sohu Video consistently offered appealing self-developed dramas and its financial loss kept narrowing due to strict cost controls. And for Sogou, the user base of its mobile search and keyboard products further expanded while its core search revenue grew faster than the industry. In the first quarter, Changyou's revenue and profit exceeded guidance as the TLBB PC game performed very well during the Chinese New Year holidays. Before I go into more detail about our key businesses, let me summarize our financial results for the first quarter. First quarter total revenues, $431 million, down 5% year-over-year and 11% quarter-over-quarter. On a constant currency basis, total revenues would have been $26 million higher than our reported revenues, so up 1% year-over-year. Net brand advertising revenues, $43 million, down 24% year-over-year and 25% quarter-over-quarter. Search and search related advertising revenues, $234 million, up 6% year-over-year and down 15% quarter-over-quarter. Online game revenues, $99 million, down 6% year-over-year and up 5% quarter-over-quarter. Excluding certain non-cash impairment charges, the operating loss for Sohu Video was $27 million compared with a loss of $48 million in the first quarter of 2018. GAAP net loss attributable to Sohu.com Limited was $57 million, compared with a net loss of $93 million in the first quarter of 2018. Non-GAAP net loss attributable to Sohu.com Limited was $55 million. Excluding the effect of the impairment charge, net -- tax effects, non-GAAP net loss attributable to Sohu.com Limited was $48 million, which compared with a net loss of $97 million a year ago, the first quarter of 2018. Excluding Sogou and Changyou, the non-GAAP net loss attributable to our core Sohu.com business, basically the media and video business, was $72 million, which compares with a net loss of $93 million in the first quarter of 2018. And for the first time, we’re going to -- for the forecast, we will forecast this non-GAAP net loss attributable to Sohu business. And Joanna will go over our business outlook. Now, let me go through some of the key businesses. First, our media portal business. In the first quarter, we -- to improve user stickiness, we continued to focus our efforts on improving our products and technology and upgrading the content on our platform. We deepened our partnerships with high quality content providers, encouraging them to create in depth articles on hot topics in an effort to increase user engagement. So the total number of articles posted by third party writers or so called Sohu [indiscernible] grew by 10% quarter over quarter. On the products side, we are developing compelling social features for Sohu news app. These features aggregate coverage of different important events such as breaking news and social topics and product launches. Not only our users can browse all related stories in a one stop way, one stop way, can also conveniently make comments and share thoughts with peers. We believe upgrades such as this will make our news app not just the information distribution platform, but also a more engaging product. Financially, while the first quarter always tend to be a seasonally soft quarter, the sluggish -- and also the sluggish economic environment continue to impact our ad revenues, however, we worked hard to elevate the negative pressure. For example, we are creating more customized solutions for our key advertising clients. In early April, we successfully hosted a celebrity off road marathon event in Hebei Province where the next Winter Olympic Games will be held. The event attracted a good number of sponsors and helped elevate the Sohu news brand. We have also been cultivating more local partner in lower tier cities better monetize our traffic. Overall, we expect a 20% plus revenue rebound in the second quarter compared with the first quarter. Now, Sohu Video. In 2019, we continue to implement what we call the two engine strategy for our content offering. On one hand, the primary focus on developing -- producing original content, long clip, long video, long clip, original content, we're also enhancing the short clips, the UGC, user generic content and its distribution, so this is a two engine strategy. We believe this combination should enable us to provide users with interesting content at a much lower cost and it will likely help our video business achieve profitability eventually. For the self-developed shows, we have built an impressive track record in two categories, in particular. One is the idol romance category. The other one is the criminal theme, the dramas. During the first quarter, our idol romance drama, called, well intended [indiscernible] became a web sensation upon its debut. It hit a hot search list on Weibo 30 times during the broadcast period, where its total video views reached 1 billion. Looking ahead, we will mainly use our in house artists and focus on producing high quality content with low to mid-range budgets. Besides Sohu Video, we are exploring opportunities in short video categories, especially UGC, leveraging our cross platform advantages. UGC videos can be more efficiently distributed across a number of Sohu family platforms, such as news, live broadcast and games and search. In the fourth quarter, benefiting from the strict cost controls, we were able to further narrow financial loss at Sohu Video. Operating loss was $27 million, which was 10% less than the previous quarter and 43% less than the same period last year. Now, turning to Sogou, in the first quarter, Sogou’s two key products search and mobile keyboard both demonstrated healthy growth, leveraging our innovative AI technologies. The number two search engine, Sogou’s core search revenue continuing to outpace industry growth. By the end of March, Sogou mobile keyboard DAU reached 443 million, up 23% from a year ago, becoming the third largest mobile app in terms of DAU in China, according to iResearch. Lastly, Changyou. In the first quarter, Changyou revenues and profits came in ahead of our expectations. In particular, its PC game revenues rose significantly on a sequential basis. Changyou launched a new expansion pack for the spring festival, as well as a variety of online and offline events for the holidays. And we see warm response from gamers. Looking at 2019, we will continue to execute our strategy of top games and improve our capabilities and efficiency in game development. MMORPG mobile games will continue to be our strategic focus, while we are also developing number of schedule games and strategy games. With the support of strong cash flow, we believe Changyou is well positioned to roll out new hit games in the future. Now, let me turn to Joanna, our CFO, who will talk you through our financial results. Joanna?

Thank you, Charles. I will walk you through the key financials. [Technical Difficulty] All of the number that I will mention are all on a non-GAAP basis. For Sohu media portal, quarterly revenues were $23 million, down 26% year-over-year. The quarterly loss was $35 million, which compares with a net loss of $29 million in the first quarter of 2018. For Sohu Video, quarterly revenues were $26 million, down 16% from a year ago. Of this, advertising revenues were $10 million. Excluding impairment charges, the operating loss for Sohu Video was $27 million, which compares with a net loss of $48 million in the same quarter last year. For Sogou, quarterly revenue were $253 million, up 2% year-over-year and down 15% quarter-over-quarter. Net loss was $3 million compared with net income of $20 million in the same quarter last year. For Changyou, quarterly revenues, including 17173, were $123 million, down 10% year-over-year, and up 5% quarter-over-quarter. Changyou posted net income of $37 million compared with net loss of $16 million in the same quarter last year. For the second quarter of 2019, we expect total revenues to be between $469 million and $494 million, brand advertising revenues to be between $47 million and $52 million. This implies annual decrease of 16% to 24% and a sequential increase of 9% to 21%. Sogou revenues to be between $303 million and $313 million. This implies increase of 1% to 4% and a sequential increase of 20% to 24%. Online game revenues to be between $90 million and $100 million. This implies annual decrease of 5% to annual increase of 6% and a sequential decrease of 9% to a sequential increase of 1%. Non-GAAP net loss attributable to Sohu.com Limited to be between $38 million and $48 million and non-GAAP loss per fully diluted ADS to be between $0.95 and $1.20. GAAP net loss attributable to Sohu.com Limited to be between $40 million and $50 million and GAAP loss per fully diluted ADS to be between $1 and $1.25. Excluding profit generated by Sogou and Changyou, non-GAAP net loss attributable to Sohu.com Limited to be between $65 million and $70 million. GAAP net loss attributable to Sohu.com Limited to be between $67 million and $72 million. For the second quarter 2019 guidance, we used a presumed exchange rate of RMB6.8 to one dollar, which compares with the actual exchange rate of around RMB6.38 to one dollar for the second quarter of 2018 and RMB6.74 to one dollar for the first quarter of 2019. With that, this concludes our prepared remarks. Operator, we will now like to open the call for questions.

[Operator Instructions] Your first question comes from the line of Alicia Yap from Citigroup.

Hi, good evening, Charles, Joanna and other management. Thanks for taking my question. I have a couple of questions. Number one is what are the plans for the use of cash from the special dividend that we see from Changyou? Second question is, what is the impact to Sohu Video on the recent regulatory restrictions on broadcasting the costume drama, any other content restriction that you foresee could be introduced later this year. And then just lastly quickly is related to Changyou. On the Changyou call earlier, the management mentioned about the [indiscernible] in Korea, so just wonder why [indiscernible] that game rather than not publishing themselves.

Okay. The use of cash, right, from the dividend. Well, yeah, on a quarterly level, we're still at a loss, still burning cash, right, so we'll continue – we need to spend money on the news apps, the channels and also product and technology development and so – and also the video, video, so, that’s – in many places, you use the cash flow, just using really diligently and make sure that we will continue to narrow the loss. So that will have a pretty room or ground to move forward. The regulation on customer drama, it's actually not much restriction, right, on the customer drama and that’s one, it's not -- it's just, there's no such regulation. So, there is talk about it, but never actually carried out. And also for Sohu’s in-house – Sohu produced dramas, we tend to have drama for modern, not the ancient stories, but the modern times, so that we have a lot of opportunities to have the embedded advertising, like a car, automobiles or mobile phones and all these kind of commercial items that are embedded in the story. For the ancient customer dramas, you don't have a lot of opportunity to do that, so the advertising.

[Foreign Language] They are running business overseas, it’s – but we are especially doing good in Korea market. [Foreign Language] So actually, we are having very good relationships with both like Tencent for some IT or local or brand, we also authorize, so it’s good for us.

[Operator Instructions] The next follow-up question comes from the line of Alicia Yap from Citigroup.

Hi. Sorry. Thanks. I have one follow up question, if I may. Actually, wanted to know, I know this April period, the whole industry, closing, signing up -- off most of the framework contract. So just wonder, if management see what is Sohu’s demand, right, from the app budget site and then also any change in terms of the different industry verticals that if you can share the color. Thank you.

[Foreign Language] Well, there is – in the auto industry, there is a mix. It's mixed signals, some of those imported cars, automobile especially US or European brand seems suffering, but the Japanese brand seems and also German brand is doing better? And yeah, the Japanese brand. Yeah. So in the auto industry, there's generally a kind of weak advertising spending, weaker. But there is mix, some strong. [Foreign Language] Yeah, exactly, the search, in the liquor business, right, the Chinese liquor business is coming up and also those kind of, fast moving consumer goods, cosmetics, medical, paramedical or something, those kind of –

Micro merchant.

Micro merchant, those are coming strong. So there is always, advertising always at an economic downturn. It's always to see some of those traditional industry sectors are kind of weak showing, but then you always have big China -- so many people, there are always some sectors that suddenly show up, right, strongly.

Okay. All right. That's helpful. Thank you, Charles.

[Operator Instructions] All right. Thank you. So there are no further questions at this time. Ladies and gentlemen, that does conclude our conference for today. Thank you for participating. You may all disconnect.