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Cheetah Mobile Inc.

Cheetah Mobile Inc.CMCM決算レポート

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Cheetah Mobile Inc. is a Chinese mobile internet company incorporated in the Cayman Islands and headquartered in Beijing.

What changed in Cheetah Mobile Inc.'s 20-F — 2024 vs 2025

Top changes in Cheetah Mobile Inc.'s 2025 20-F

594 paragraphs added · 645 removed · 452 edited across 5 sections

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

202 edited+60 added−47 removed593 unchanged
Our business has continued to experience some challenges in the international markets and continue exposing to a number of risks, including: • challenges in formulating effective marketing strategies targeting users and customers from various jurisdictions and cultures, who have a diverse range of preferences and demands; • challenges in identifying appropriate local business partners and establishing and maintaining good working relationships with them. • local competition; • challenges in meeting local user, advertiser and customer demands as well as their marketing practices and conventions; • differences in user, advertiser and customer reception and perception of our products and services internationally; • challenges in building direct sales operations in the overseas market; • fluctuations in currency exchange rates; • compliance with applicable foreign laws and regulations, including but not limited to internet content requirements, foreign exchange controls, cash repatriation restrictions, intellectual property protection rules and data privacy requirements; 17 Table of Contents • exposure to different tax jurisdictions that may subject us to greater fluctuations in our effective tax rate and assessments in multiple jurisdictions on various tax-related assertions, including transfer pricing adjustments and permanent establishment; and • increased costs associated with doing business in foreign jurisdictions.
Our business has continued to experience some challenges in the international markets and continue exposing to a number of risks, including: • challenges in formulating effective marketing strategies targeting users and customers from various jurisdictions and cultures, who have a diverse range of preferences and demands; • challenges in identifying appropriate local business partners and establishing and maintaining good working relationships with them. • local competition; • challenges in meeting local user, advertiser and customer demands as well as their marketing practices and conventions; 17 Table of Contents • differences in user, advertiser and customer reception and perception of our products and services internationally; • challenges in building direct sales operations in the overseas market; • fluctuations in currency exchange rates; • compliance with applicable foreign laws and regulations, including but not limited to internet content requirements, foreign exchange controls, cash repatriation restrictions, intellectual property protection rules and data privacy requirements; • exposure to different tax jurisdictions that may subject us to greater fluctuations in our effective tax rate and assessments in multiple jurisdictions on various tax-related assertions, including transfer pricing adjustments and permanent establishment; and • increased costs associated with doing business in foreign jurisdictions.
If the PRC government deems that our contractual arrangements with the consolidated variable interest entities do not comply with PRC regulatory restrictions on foreign investment in the relevant industries, or if these regulations or the interpretation of existing regulations change or are interpreted differently in the future, we could be subject to severe penalties or be forced to relinquish our interests in those operations.
If the PRC government deems that our contractual arrangements with the consolidated variable interest entities do not comply with PRC regulatory restrictions on foreign investment in the relevant industries, or if these regulations or the interpretation of existing regulations change or are interpreted differently in the future, we could be subject to severe penalties or be forced to relinquish our interests in those operations.
New York Stock Exchange fall within the definition of “abroad” in the provision, however, we are already listed on the New York Stock Exchange, therefore, there can be no assurance if we are required to follow the Cybersecurity review or the security assessment procedures, and if so, whether we would be able to complete the applicable cybersecurity review or the security assessment procedures in a timely manner.
New York Stock Exchange fall within the definition of “abroad” in the provision, however, we are already listed on the New York Stock Exchange, therefore, there can be no assurance if we are required to follow the Cybersecurity review or the security assessment procedures, and if so, whether we would be able to complete the applicable cybersecurity review or the security assessment procedures in a timely manner.
On December 16, 2021, the PCAOB issued a report to notify the SEC of its determination that the PCAOB is unable to inspect or investigate completely registered public accounting firms headquartered in mainland China and Hong Kong, or the 2021 Determinations.
On December 16, 2021, the PCAOB issued a report to notify the SEC of its determination that the PCAOB is unable to inspect or investigate completely registered public accounting firms headquartered in mainland China and Hong Kong, or the 2021 Determinations.
The PCAOB is expected to continue to demand complete access to inspections and investigations against accounting firms headquartered in mainland China and Hong Kong in the future and states that it has already made plans to resume regular inspections in early 2023 and beyond.
The PCAOB is expected to continue to demand complete access to inspections and investigations against accounting firms headquartered in mainland China and Hong Kong in the future and states that it has already made plans to resume regular inspections in early 2023 and beyond.
Should the PCAOB again encounter impediments to inspections and investigations in mainland China or Hong Kong as a result of positions taken by any authority in either jurisdiction, the PCAOB will make determinations under the HFCAA as and when appropriate, then such lack of inspection could cause our securities to be delisted from the stock exchange.
Should the PCAOB again encounter impediments to inspections and investigations in mainland China or Hong Kong as a result of positions taken by any authority in either jurisdiction, the PCAOB will make determinations under the HFCAA as and when appropriate, then such lack of inspection could cause our securities to be delisted from the stock exchange.
However, the Cayman Islands courts are unlikely to enforce a judgment obtained from the U.S. courts under civil liability provisions of the U.S. federal securities law if such judgment is determined by the courts of the Cayman Islands to give rise to obligations to make payments that are penal or punitive in nature.
However, the Cayman Islands courts are unlikely to enforce a judgment obtained from the U.S. courts under civil liability provisions of the U.S. federal securities law if such judgment is determined by the courts of the Cayman Islands to give rise to obligations to make payments that are penal or punitive in nature.
Although there is no statutory enforcement in the Cayman Islands of judgments obtained in the federal or state courts of the United States (and the Cayman Islands are not a party to any treaties for the reciprocal enforcement or recognition of such judgments), the courts of the Cayman Islands will, at common law, recognize and enforce a foreign money judgement of a foreign court of competent jurisdiction without any re-examination of the merits of the underlying dispute based on the principle that that the judgment of the competent foreign court imposes upon the judgment debtor an obligation to pay a liquidated sum for which such judgment has been given, provided such judgment (a) is given by a competent foreign court with jurisdiction to give the judgment, (b) imposes on the judgment debtor a liability to pay a liquidated sum for which the judgment has been given, (c) is final, (d) is not in respect of taxes, a fine or a penalty and (e) was not obtained in a manner and is not of a kind the enforcement of which is contrary to natural justice or the public policy of the Cayman Islands.
Although there is no statutory enforcement in the Cayman Islands of judgments obtained in the federal or state courts of the United States (and the Cayman Islands are not a party to any treaties for the reciprocal enforcement or recognition of such judgments), the courts of the Cayman Islands will, at common law, recognize and enforce a foreign money judgment of a foreign court of competent jurisdiction without any re-examination of the merits of the underlying dispute based on the principle that the judgment of the competent foreign court imposes upon the judgment debtor an obligation to pay a liquidated sum for which such judgment has been given, provided such judgment (a) is given by a competent foreign court with jurisdiction to give the judgment, (b) imposes on the judgment debtor a liability to pay a liquidated sum for which the judgment has been given, (c) is final, (d) is not in respect of taxes, a fine or a penalty and (e) was not obtained in a manner and is not of a kind the enforcement of which is contrary to natural justice or the public policy of the Cayman Islands.
Any such lawsuit, whether or not successful, could harm our reputation and restrict our ability to raise capital in the future. In addition, if a claim against us is successful, we may be required to pay significant damages, which could have a material adverse effect on our financial condition and results of operations.
Any lawsuit, whether or not successful, could harm our reputation and restrict our ability to raise capital in the future. In addition, if a claim against us is successful, we may be required to pay significant damages, which could have a material adverse effect on our financial condition and results of operations.
With respect to our Hong Kong entities, although currently there are not equivalent or similar restrictions or limitations in Hong Kong on cash transfers in, or out of, our Hong Kong entities (including currency conversion), if certain restrictions or limitations in mainland China were to become applicable to cash transfers in and out of Hong Kong entities (including currency conversion) in the future, the funds in our Hong Kong entities, likewise, may not be available to meet our currency demand.
With respect to our Hong Kong entities, although currently there are no equivalent or similar restrictions or limitations in Hong Kong on cash transfers in, or out of, our Hong Kong entities (including currency conversion), if certain restrictions or limitations in mainland China were to become applicable to cash transfers in and out of Hong Kong entities (including currency conversion) in the future, the funds in our Hong Kong entities, likewise, may not be available to meet our currency demand.
As used in this annual report, “we,” “us,” “our company,” or “our” refers to Cheetah Mobile Inc., its subsidiaries and, in the context of describing our operations and consolidated financial information, the consolidated variable interest entities and their subsidiaries in China, including but not limited to Beijing Mobile, Beijing Network and Beijing Conew.
As used in this annual report, “we,” “us,” “our company,” or “our” refers to Cheetah Mobile Inc., its subsidiaries and, in the context of describing our operations and consolidated financial information, the consolidated variable interest entities and their subsidiaries in China, including but not limited to Beijing Mobile, and Beijing Network.
Although currently there are not equivalent or similar restrictions or limitations in Hong Kong on cash transfers in, or out of, our Hong Kong entities (including currency conversion), if certain restrictions or limitations in mainland China were to become applicable to cash transfers in and out of Hong Kong entities (including currency conversion) in the future, the funds in our Hong Kong entities, likewise, may not be available to meet our currency demand.
Although currently there are no equivalent or similar restrictions or limitations in Hong Kong on cash transfers in, or out of, our Hong Kong entities (including currency conversion), if certain restrictions or limitations in mainland China were to become applicable to cash transfers in and out of Hong Kong entities (including currency conversion) in the future, the funds in our Hong Kong entities, likewise, may not be available to meet our currency demand.
We conduct our operations in China through (i) our PRC subsidiaries and (ii) the consolidated variable interest entities and their subsidiaries, including but not limited to Beijing Mobile, Beijing Network and Beijing Conew. PRC laws and regulations restrict and impose conditions on foreign investment in the internet industry, including the mobile internet industry.
We conduct our operations in China through (i) our PRC subsidiaries and (ii) the consolidated variable interest entities and their subsidiaries, including but not limited to Beijing Mobile and Beijing Network. PRC laws and regulations restrict and impose conditions on foreign investment in the internet industry, including the mobile internet industry.
We have historically to defended against putative shareholder class action lawsuits described in “Item 8. Financial Information—A. Consolidated Statements and Other Financial Information—Legal Proceedings.” We may be named as a defendant in putative shareholder class action lawsuit in the future.
We have historically defended against putative shareholder class action lawsuits described in “Item 8. Financial Information—A. Consolidated Statements and Other Financial Information—Legal Proceedings.” We may be named as a defendant in putative shareholder class action lawsuit in the future.
Prior the promulgation of the Foreign Investment Law or the FIL, only principal provisions are scattered and mentioned in few articles of regulations. In this context, FIL officially established safety review system for foreign investment at the level of law for the first time.
Prior to the promulgation of the Foreign Investment Law or the FIL, only principal provisions are scattered and mentioned in few articles of regulations. In this context, FIL officially established safety review system for foreign investment at the level of law for the first time.
Ltd.) Holders of our Class A ordinary shares or the ADSs hold equity interest in Cheetah Mobile Inc., our Cayman Islands holding company, and do not have direct or indirect equity interests in the VIEs and their subsidiaries.
Holders of our Class A ordinary shares or the ADSs hold equity interest in Cheetah Mobile Inc., our Cayman Islands holding company, and do not have direct or indirect equity interests in the VIEs and their subsidiaries.
If any of such entities undergoes a voluntary or involuntary liquidation proceeding, the unrelated third-party creditors may claim rights to some or all of these assets, thereby hindering our ability to operate our business, which could materially and adversely affect our business, financial condition and results of operations. 35 Table of Contents Risks Relating to Doing Business in China Uncertainties in the interpretation and enforcement of Chinese laws and regulations could limit the legal protections available to you and us.
If any of such entities undergoes a voluntary or involuntary liquidation proceeding, the unrelated third-party creditors may claim rights to some or all of these assets, thereby hindering our ability to operate our business, which could materially and adversely affect our business, financial condition and results of operations. 36 Table of Contents Risks Relating to Doing Business in China Uncertainties in the interpretation and enforcement of Chinese laws and regulations could limit the legal protections available to you and us.
Also, according to the Administrative Provisions on Mobile Internet Applications Information Services released by the CAC revised on June 14, 2022, APP providers and APP distribution platforms shall perform the primary responsibility for information content management, actively cooperate with the State to implement the strategy of trusted identities in cyberspace, establish sound information content security management systems, information content ecological governance systems, data security and personal information protection systems, minor protection systems and other management systems to ensure cyber security and maintain a good network ecology.
Also, according to the Administrative Provisions on Mobile Internet Applications Information Services released by the CAC revised on June 14, 2022, APP providers and APP distribution platforms shall perform the primary responsibility for information content management, actively cooperate with the State to implement the strategy of trusted identities in cyberspace, establish sound information content security management systems, information content ecological governance systems, data security and personal information protection systems, minor protection systems and other management systems to ensure cybersecurity and maintain a good network ecology.
If the imposition of any of these government actions causes us to lose our right to direct the activities of our variable interest entities or our right to receive substantially all the economic benefits and residual returns from our variable interest entities and we are not able to restructure our ownership structure and operations in a satisfactory manner, we would no longer be able to consolidate the financial results of our variable interest entities in our consolidated 32 Table of Contents financial statements.
If the imposition of any of these government actions causes us to lose our right to direct the activities of our variable interest entities or our right to receive substantially all the economic benefits 33 Table of Contents and residual returns from our variable interest entities and we are not able to restructure our ownership structure and operations in a satisfactory manner, we would no longer be able to consolidate the financial results of our variable interest entities in our consolidated financial statements.
If we are deemed to have violated relevant labor laws and regulations, we could be required to provide additional compensation to our employees, and our business, financial condition and results of operations could be materially and adversely affected. 46 Table of Contents If the custodians or authorized users of controlling non-tangible assets of our company, including our corporate chops and seals, fail to fulfill their responsibilities, or misappropriate or misuse these assets, our business and operations could be materially and adversely affected.
If we are deemed to have violated relevant labor laws and regulations, we could be required to provide additional compensation to our employees, and our business, financial condition and results of operations could be materially and adversely affected. 48 Table of Contents If the custodians or authorized users of controlling non-tangible assets of our company, including our corporate chops and seals, fail to fulfill their responsibilities, or misappropriate or misuse these assets, our business and operations could be materially and adversely affected.
Key Information—Risk Factors—Risks Relating to Doing Business in China—PRC regulation of loans to, and direct investment in, PRC entities by offshore holding companies and governmental control of currency conversion may restrict or prevent us from loans to our PRC entities or to make additional capital contributions to our PRC subsidiaries, which may materially and adversely affect our liquidity and our ability to fund and expand our business.” For the years ended December 31, 2022, 2023 and 2024, certain of our PRC subsidiaries have declared dividends to our Hong Kong subsidiaries for an aggregate amount of nil, RMB10.2 million and RMB19.8 million (US$2.7 million) ; the dividend payments are subject to withholding tax.
Key Information—Risk Factors—Risks Relating to Doing Business in China—PRC regulation of loans to, and direct investment in, PRC entities by offshore holding companies and governmental control of currency conversion may restrict or prevent us from loans to our PRC entities or to make additional capital contributions to our PRC subsidiaries, which may materially and adversely affect our liquidity and our ability to fund and expand our business.” For the years ended December 31, 2023, 2024 and 2025, certain of our PRC subsidiaries have declared dividends to our Hong Kong subsidiaries for an aggregate amount of RMB10.2 million, RMB19.8 million and nil; the dividend payments are subject to withholding tax.
In addition, enterprises that are granted the high and new technology enterprises status, as well as those that located in Guangdong-Macao Deep Cooperation Zone which also qualify as encouraged industrial enterprises and meet the substantive operational requirements, shall enjoy a favorable income tax rate of 15%. Certain of our PRC subsidiaries and VIEs were eligible for certain preferential tax treatments.
However, enterprises that are granted the high and new technology enterprises status, as well as those that located in Guangdong-Macao Deep Cooperation Zone which also qualify as encouraged industrial enterprises and meet the substantive operational requirements, shall enjoy a favorable income tax rate of 15%. Certain of our PRC subsidiaries and VIEs were eligible for certain preferential tax treatments.
Nevertheless, there can be no assurance that the relevant authorities will not take a view that is contrary to or otherwise different from that of our PRC Legal Advisor, and it is also possible that the PRC government authorities may require us to apply for security assessment or complete the other filing, change or deregistration formalities of algorithms for other reasons.
Nevertheless, there can be no assurance that the relevant authorities will not take a view that is contrary to or otherwise different from that of our PRC Legal Adviser, and it is also possible that the PRC government authorities may require us to apply for security assessment or complete the other filing, change or deregistration formalities of algorithms for other reasons.
In connection with the preparation and external audit of our consolidated financial statements as of and for the year ended December 31, 2024, we concluded that our internal control over financial reporting was effective as of December 31, 2024. See “Item 15. Controls and Procedures—Management’s Annual Report on Internal Control over Financial Reporting.” We have limited business insurance coverage.
In connection with the preparation and external audit of our consolidated financial statements as of and for the year ended December 31, 2025, we concluded that our internal control over financial reporting was effective as of December 31, 2025. See “Item 15. Controls and Procedures—Management’s Annual Report on Internal Control over Financial Reporting.” We have limited business insurance coverage.
Meanwhile, the network information content service platforms are required to fulfill their primary responsibilities for management of information contents, and are required not to 38 Table of Contents disseminate any illegal information as mentioned in the Provisions on Governance of the Network Information Content Ecology released by the CAC on December 15, 2019, with effect from March 1, 2020.
Meanwhile, the network information content service platforms are required to fulfill their primary responsibilities for management of information contents, and are required not to disseminate any illegal information as mentioned in the Provisions on Governance of the Network Information Content Ecology released by the CAC on December 15, 2019, with effect from March 1, 2020.
Risk Factors—Risks Relating to Doing Business in China—The approval of and filing with the CSRC or other PRC government authorities may be required in connection with our future offshore offerings under PRC law, and, if required, we cannot predict whether or for how long we will be able to obtain such approval or complete such filing.” Cash and Asset Flows through Our Organization Cheetah Mobile Inc. is a holding company with no material operations of its own.
Risk Factors—Risks Relating to Doing Business in China—The approval of and filing with the CSRC or other PRC government authorities may be required in connection with our future offshore offerings under PRC law, and, if required, we cannot predict whether or for how long we will be able to obtain such approval or complete such filing.” 7 Table of Contents Cash and Asset Flows through Our Organization Cheetah Mobile Inc. is a holding company with no material operations of its own.
Regulations—Regulations of Foreign Currency Exchange, Foreign Debt and Dividend Distribution.” In light of the various requirements imposed by PRC regulations on loans to and direct investment in PRC entities by offshore holding companies as discussed above, we cannot assure you that we will be able to complete the necessary government registrations or obtain the necessary government approvals on a timely basis, or at all, with respect to future loans by us to our PRC entities or with respect to future capital contributions by us to our PRC subsidiaries.
Regulations—Regulations of Foreign Currency Exchange, Foreign Debt and Dividend Distribution.” In light of the various requirements imposed by PRC regulations on loans to and direct investment in PRC entities by offshore holding companies as discussed above, we cannot assure you that we will be able to complete the necessary government registrations or obtain the necessary government approvals on a timely basis, or at all, with respect to future loans by us to our PRC entities or with 46 Table of Contents respect to future capital contributions by us to our PRC subsidiaries.
For example, our board of directors has the authority, without further action by our shareholders, to issue preferred shares in one or more series and to fix their designations, powers, preferences, privileges, and relative participating, optional or special rights, and the qualifications, limitations or restrictions, including dividend rights, conversion rights, voting rights, terms of redemption and liquidation preferences, any or all of which may be greater than the rights associated with our ordinary shares, represented by ADSs or otherwise.
For example, our board of directors has the authority, without further action by our shareholders, to issue preferred shares in one or more series and to fix their designations, powers, preferences, privileges, and relative participating, optional or special rights, and the qualifications, limitations or restrictions, including dividend rights, conversion rights, voting rights, terms of redemption and liquidation preferences, any or all of which may be greater 51 Table of Contents than the rights associated with our ordinary shares, represented by ADSs or otherwise.
According to the FIL, foreign investment may be conducted through the following four ways: (i) foreign investor, independently or jointly with other investors, set up foreign-invested enterprises in China, (ii) foreign investors obtain shares, equities, property shares or other similar rights and interests of Chinese domestic enterprises, (iii) foreign investor, independently or jointly with other investors, invests in a new project (the “Project Investment”) and (iv) other forms stipulated under laws, administrative regulations and provisions of the State Council.
According to the FIL, foreign investment may be conducted through the following four ways: (i) foreign investor, independently or jointly with other investors, set up foreign-invested enterprises in China, (ii) foreign investors obtain shares, equities, property shares or other similar rights and interests of Chinese domestic enterprises, (iii) foreign investor, independently or jointly with other investors, invests in a new project (the “Project Investment”) and (iv) other forms stipulated under laws, administrative regulations and provisions 34 Table of Contents of the State Council.
Also, on February 24, 2023, CSRC and other three PRC regulatory authorities jointly issued the Confidentiality and Archives Administration Provisions, which will take effect on March 31, 2023, according to which, overseas securities regulators and competent overseas authorities may request to inspect, investigate or collect evidence from a domestic company concerning its overseas offering and listing or from the domestic securities companies and securities service providers that undertake relevant businesses for such domestic companies, such inspection, investigation and evidence collection shall be conducted under a cross-border regulatory cooperation mechanism, and the CSRC or other competent Chinese authorities will provide necessary 40 Table of Contents assistance pursuant to bilateral and multilateral cooperation mechanisms.
Also, on February 24, 2023, CSRC and other three PRC regulatory authorities jointly issued the Confidentiality and Archives Administration Provisions, which will take effect on March 31, 2023, according to which, overseas securities regulators and competent overseas authorities may request to inspect, investigate or collect evidence from a domestic company concerning its overseas offering and listing or from the domestic securities companies and securities service providers that undertake relevant businesses for such domestic companies, such inspection, investigation and evidence collection shall be conducted under a cross-border regulatory cooperation mechanism, and the CSRC or other competent Chinese authorities will provide necessary assistance pursuant to bilateral and multilateral cooperation mechanisms.
WFOEs Other Subsidiaries VIEs and Their Subsidiaries Eliminations Consolidated Total (RMB, in thousands) Cash and cash equivalents 156,153 59,278 1,345,574 272,026 — 1,833,031 Short-term investments — — 335 — — 335 Due from related parties, net — 653 65,620 40,661 — 106,934 Others 2,442 20,323 1,670,682 145,933 — 1,839,380 Total current assets 158,595 80,254 3,082,211 458,620 — 3,779,680 Investments in subsidiaries — — — — — — Contractual interests in VIEs and their subsidiaries 57,067 — — — (57,067) — Others 75,831 21,898 1,230,600 396,292 — 1,724,621 Total non-current assets 132,898 21,898 1,230,600 396,292 (57,067) 1,724,621 Amount due from Cheetah Mobile Inc. — 187 531,064 — (531,251) — Amount due from WFOEs 2,066 — 851,173 112,953 (966,192) — Amount due from other subsidiaries 2,692,216 868,872 — 873,502 (4,434,590) — Amount due from VIEs and their subsidiaries — 351,278 1,077,461 — (1,428,739) — Amount due from Group companies 2,694,282 1,220,337 2,459,698 986,455 (7,360,772) — Total assets 2,985,775 1,322,489 6,772,509 1,841,367 (7,417,839) 5,504,301 Due to related parties — 178 60,503 8,925 — 69,606 Investment deficit in subsidiaries 325,009 — — — (325,009) — Others 24,348 47,427 2,578,527 361,873 — 3,012,175 Total current liabilities 349,357 47,605 2,639,030 370,798 (325,009) 3,081,781 Total non-current liabilities 145,660 4,108 64,038 1,588 — 215,394 Amount due to Cheetah Mobile Inc. — 1,916 2,633,448 — (2,635,364) — Amount due to WFOEs 337 — 847,963 311,345 (1,159,645) — Amount due to other subsidiaries 589,823 876,293 — 1,096,026 (2,562,142) — Amount due to VIEs and their subsidiaries — 152,885 850,736 — (1,003,621) — Amount due to Group companies 590,160 1,031,094 4,332,147 1,407,371 (7,360,772) — Total liabilities 1,085,177 1,082,807 7,035,215 1,779,757 (7,685,781) 3,297,175 10 Table of Contents Selected Condensed Consolidated Balance Sheets Data (Continued) As of December 31, 2023 Cheetah Mobile Inc.
WFOEs Other Subsidiaries VIEs and Their Subsidiaries Eliminations Consolidated Total (RMB, in thousands) Cash and cash equivalents 156,153 59,278 1,345,574 272,026 — 1,833,031 Short-term investments — — 335 — — 335 Due from related parties, net — 653 65,620 40,661 — 106,934 Others 2,442 20,323 1,670,682 145,933 — 1,839,380 Total current assets 158,595 80,254 3,082,211 458,620 — 3,779,680 Investments in subsidiaries — — — — — — Contractual interests in VIEs and their subsidiaries 57,067 — — — (57,067) — Others 75,831 21,898 1,230,600 396,292 — 1,724,621 Total non-current assets 132,898 21,898 1,230,600 396,292 (57,067) 1,724,621 Amount due from Cheetah Mobile Inc. — 187 531,064 — (531,251) — Amount due from WFOEs 2,066 — 851,173 112,953 (966,192) — Amount due from other subsidiaries 2,692,216 868,872 — 873,502 (4,434,590) — Amount due from VIEs and their subsidiaries — 351,278 1,077,461 — (1,428,739) — Amount due from Group companies 2,694,282 1,220,337 2,459,698 986,455 (7,360,772) — Total assets 2,985,775 1,322,489 6,772,509 1,841,367 (7,417,839) 5,504,301 Due to related parties — 178 60,503 8,925 — 69,606 Investment deficit in subsidiaries 325,009 — — — (325,009) — Others 24,348 47,427 2,578,527 361,873 — 3,012,175 Total current liabilities 349,357 47,605 2,639,030 370,798 (325,009) 3,081,781 Total non-current liabilities 145,660 4,108 64,038 1,588 — 215,394 Amount due to Cheetah Mobile Inc. — 1,916 2,633,448 — (2,635,364) — Amount due to WFOEs 337 — 847,963 311,345 (1,159,645) — Amount due to other subsidiaries 589,823 876,293 — 1,096,026 (2,562,142) — Amount due to VIEs and their subsidiaries — 152,885 850,736 — (1,003,621) — Amount due to Group companies 590,160 1,031,094 4,332,147 1,407,371 (7,360,772) — Total liabilities 1,085,177 1,082,807 7,035,215 1,779,757 (7,685,781) 3,297,175 11 Table of Contents Selected Condensed Consolidated Cash Flows Data For the Year Ended December 31, 2025 Cheetah Mobile Inc.
C. Reasons for the Offer and Use of Proceeds Not applicable. D. Risk Factors Summary of Risk Factors An investment in our ADSs or ordinary shares involves significant risks. The following list summarizes some, but not all, of these risks.
Capitalization and Indebtedness Not applicable. C. Reasons for the Offer and Use of Proceeds Not applicable. D. Risk Factors Summary of Risk Factors An investment in our ADSs or ordinary shares involves significant risks. The following list summarizes some, but not all, of these risks.
With our PRC Legal Advisor's view as mentioned above, we are of the view that the Generative Artificial Intelligence Services Measures will not have a material adverse impact on our current and future business operations and financial performance.
With our PRC Legal Adviser's view as mentioned above, we are of the view that the Generative Artificial Intelligence Services Measures will not have a material adverse impact on our current and future business operations and financial performance.
As a company in the early stages of expanding our service robot offerings, there is uncertainty around future market demand and production requirements. If adoption of our robots accelerates rapidly, we may need to ramp up manufacturing substantially to fulfill increased orders. However, scaling production could pose challenges given our reliance on third-party suppliers and manufacturers.
As a company in the early stages of expanding our robotic offerings, there is uncertainty around future market demand and production requirements. If adoption of our robots accelerates rapidly, we may need to ramp up manufacturing substantially to fulfill increased orders. However, scaling production could pose challenges given our reliance on third-party suppliers and manufacturers.
Risk Factors—Risks Relating to Doing Business in China—Failure to meet the PRC government’s complex regulatory requirements on our business operation could have a material adverse effect on our operations and the value of our ADSs.” 5 Table of Contents Risks and uncertainties arising from the legal system in China, including risks and uncertainties regarding the enforcement of laws and quickly evolving rules and regulations in China, could result in a material adverse change in our operations and the value of our ADSs.
Risk Factors—Risks Relating to Doing Business in China—Failure to meet the PRC government’s complex regulatory requirements on our business operation could have a material adverse effect on our operations and the value of our ADSs.” Risks and uncertainties arising from the legal system in China, including risks and uncertainties regarding the enforcement of laws and quickly evolving rules and regulations in China, could result in a material adverse change in our operations and the value of our ADSs.
Also, according to Article 36 of the Data Security Law, which became effective in September 2021, the competent authority of the People’s Republic of China shall, in accordance with the relevant laws or the international treaties and agreements concluded or acceded to by the People’s Republic of China, or on the principle of equality and reciprocity, handle the requests for provision of data from foreign judicial or law enforcement organizations.
Also, according to Article 36 of the Data Security Law, which became effective in September 2021, the competent authority of the People’s Republic of China shall, in accordance with the relevant laws or the international treaties and agreements concluded or acceded to by the People’s Republic of China, or on the principle of equality and 42 Table of Contents reciprocity, handle the requests for provision of data from foreign judicial or law enforcement organizations.
In addition, securities markets may from time to time experience significant price and volume fluctuations that are not related to our operating performance, such as the large decline in share prices in the United States, China and other jurisdictions between late 2008 and 2012, which may have a material adverse effect on the market price of the ADSs.
In addition, securities markets may from time to time experience significant price and volume fluctuations that are not related 50 Table of Contents to our operating performance, such as the large decline in share prices in the United States, China and other jurisdictions between late 2008 and 2012, which may have a material adverse effect on the market price of the ADSs.
The FIL also establishes several administration systems for foreign investment, amongst others, the information reporting system. Foreign investors or FIEs are required to submit investment information to the competent authorities through the system of enterprises registration and enterprise credibility disclosure.
The FIL also establishes several administration systems for foreign investment, among others, the information reporting system. Foreign investors or FIEs are required to submit investment information to the competent authorities through the system of enterprises registration and enterprise credibility disclosure.
When a general meeting is convened, you may not receive sufficient advance notice of the meeting to permit you to withdraw the Class A 51 Table of Contents ordinary shares underlying your ADSs and become the registered holder of such shares to allow you to attend the general meeting and to cast your vote directly with respect to any specific matter or resolution to be considered and voted upon at the general meeting.
When a general meeting is convened, you may not receive sufficient advance notice of the meeting to permit you to withdraw the Class A ordinary shares underlying your ADSs and become the registered holder of such shares to allow you to attend the general meeting and to cast your vote directly with respect to any specific matter or resolution to be considered and voted upon at the general meeting.
It is difficult to predict how market forces or PRC or U.S. government policy may impact the exchange rate between Renminbi and the U.S. dollar in the future. Any significant appreciation or depreciation of Renminbi may materially and adversely affect our revenues, earnings and financial position, and the value of, and any dividends payable on, our ADSs in U.S. dollars.
It is difficult to predict how market forces or PRC or U.S. government policy may impact the exchange rate between Renminbi and the U.S. dollar in the future. 47 Table of Contents Any significant appreciation or depreciation of Renminbi may materially and adversely affect our revenues, earnings and financial position, and the value of, and any dividends payable on, our ADSs in U.S. dollars.
For the years ended December 31, 2022, 2023 and 2024, our overseas subsidiaries provide promotion service to our PRC subsidiaries, total amount paid for such services by our PRC subsidiaries to our overseas subsidiaries were nil, RMB13.9 million and nil.
For the years ended December 31, 2023, 2024 and 2025, our overseas subsidiaries provide promotion service to our PRC subsidiaries, total amount paid for such services by our PRC subsidiaries to our overseas subsidiaries were RMB13.9 million, nil and nil.
Any interruption in the ability of our users to use our applications could damage our reputation, reduce our future revenues, harm our future operations, subject us to regulatory scrutiny and lead users to seek alternative products. We mostly use third party cloud-based services, such as Tencent cloud, AWS etc. instead of self-owned servers.
Any interruption in the ability of our users to use our applications could damage our reputation, reduce our future revenues, harm our future operations, subject us to regulatory scrutiny and lead users to seek alternative products. We mostly use external cloud-based services, such as Tencent cloud, AWS etc. instead of self-owned servers.
Our company has limited experience in scaling the commercialization of our service robots, and there is a risk that we may not achieve this expansion efficiently or effectively. A critical component of our strategic plan for our service robot line is to expand our sales, marketing, training, customer support, and maintenance services.
Our company has limited experience in scaling the commercialization of our robotic products, and there is a risk that we may not achieve this expansion efficiently or effectively. A critical component of our strategic plan for our service robot line is to expand our sales, marketing, training, customer support, and maintenance services.
Our articles of association contain anti-takeover provisions that could have a material adverse effect on the rights of holders of our ordinary shares and ADSs. 49 Table of Contents Our currently effective fourth amended and restated articles of association contain provisions to limit the ability of others to acquire control of our company or cause us to engage in change-of-control transactions.
Our articles of association contain anti-takeover provisions that could have a material adverse effect on the rights of holders of our ordinary shares and ADSs. Our currently effective fourth amended and restated articles of association contain provisions to limit the ability of others to acquire control of our company or cause us to engage in change-of-control transactions.
(5) Conew Network, through Gongqingcheng Orion Industrial Investment Center (Limited Partnership) ("The Fund"), indirectly holds 1.85% equity interest of Beijing OrionStar. Conew Network is one of the limited partners of the Fund and currently owns 49.5% interest in the Fund. 4 Table of Contents (6) Dream Ahead Pte. Ltd.("Dream Ahead", formerly known as Cheetah Mobile Singapore Pte.
(4) Conew Network, through Gongqingcheng Orion Industrial Investment Center (Limited Partnership) ("The Fund"), indirectly holds 1.85% equity interest of Beijing OrionStar. Conew Network is one of the limited partners of the Fund and currently owns 49.5% interest in the Fund. (5) Dream Ahead Pte. Ltd.("Dream Ahead", formerly known as Cheetah Mobile Singapore Pte.
A key part of our business strategy depends on our ability to provide high-quality products and services, including our service robots, AI-powered business applications, advertising agency services and multi-cloud management services. Any actual or perceived reduction in the quality or performance of our offerings could damage our reputation and result in customer dissatisfaction.
A key part of our business strategy depends on our ability to provide high-quality products and services, including our robotic products, AI-powered business applications, advertising agency services and multi-cloud management services. Any actual or perceived reduction in the quality or performance of our offerings could damage our reputation and result in customer dissatisfaction.
If any of these suppliers or service partners choose to not do business with us, then we would have significant difficulty in procuring and producing our service robots and our business prospects would be significantly harmed. Our service robots contain hundreds of components which are assembled by third-party manufacturing partners.
If any of these suppliers or service partners choose to not do business with us, then we would have significant difficulty in procuring and producing our robotic products and our business prospects would be significantly harmed. Our robotic products contain hundreds of components which are assembled by third-party manufacturing partners.
These third-party services may experience downtime from time to time, and we have limited control over the quality and reliability of these services. Any scheduled or unscheduled interruption in our ability to use such services could result in service disruption, which could result in an immediate, and possibly substantial, loss of revenues.
These external services may experience downtime from time to time, and we have limited control over the quality and reliability of these services. Any scheduled or unscheduled interruption in our ability to use such services could result in service disruption, which could result in an immediate, and possibly substantial, loss of revenues.
Although we have worked to make the utmost commercially reasonable efforts to ensure that we collect personal information and data only with users’ prior consent and have adopted measures to 27 Table of Contents protect the data security and minimize the risk of data loss, we cannot assure you that the measures we have taken are always sufficient and effective.
Although we have worked to make the utmost commercially reasonable efforts to ensure that we collect personal information and data only with users’ prior consent and have adopted measures to protect the data security and minimize the risk of data loss, we cannot assure you that the measures we have taken are always sufficient and effective.
A series of contractual agreements, including business operation agreements, shareholder voting proxy agreements, equity pledge agreements, exclusive technology development, support and consultancy agreements, loan agreements and exclusive option agreements, have been entered into by and among our company, our subsidiaries, the consolidated variable interest entities and their respective shareholders.
A series of contractual agreements, including business operation agreements, shareholder voting proxy agreements, equity pledge agreements, exclusive technology 4 Table of Contents development, support and consultancy agreements, loan agreements and exclusive option agreements, have been entered into by and among our company, our subsidiaries, the consolidated variable interest entities and their respective shareholders.
For example, to the extent that we need to convert U.S. dollars we receive from our initial public offerings or convertible senior notes offering into Renminbi for our operations, 45 Table of Contents appreciation of the Renminbi against the U.S. dollar would have an adverse effect on the Renminbi amount we would receive from the conversion.
For example, to the extent that we need to convert U.S. dollars we receive from our initial public offerings or convertible senior notes offering into Renminbi for our operations, appreciation of the Renminbi against the U.S. dollar would have an adverse effect on the Renminbi amount we would receive from the conversion.
This means that you may not receive distributions we make on our Class A ordinary shares or any value for them if it is illegal or impractical for us to make them available to you. These restrictions may cause a material decline in the value of the ADSs.
This means that 54 Table of Contents you may not receive distributions we make on our Class A ordinary shares or any value for them if it is illegal or impractical for us to make them available to you. These restrictions may cause a material decline in the value of the ADSs.
Certain corporate governance practices in the Cayman Islands, which is our home country, may differ significantly from the NYSE corporate governance rules. Currently, we rely on home country practice exemption with respect to the requirements for an audit committee composed of at least three members, annual shareholders’ meeting, shareholder approval of equity-compensation plans and a majority of independent directors.
Certain corporate governance practices in the Cayman Islands, which is our home country, may differ significantly from the NYSE corporate governance rules. Currently, we rely on home country practice exemption with respect to the requirements for an audit committee composed of at least three members, annual general meetings, shareholder approval of equity-compensation plans and a majority of independent directors.
Issues, risks and uncertainties relating to PRC regulation of the internet business include, but are not limited to, the following: On July 13, 2006, the MIIT issued the Circular of the Ministry of Information Industry on Strengthening the Administration of Foreign Investment in Value-added Telecommunications Services.
Issues, risks and uncertainties relating to PRC regulation of the internet business include, but are not limited to, the following: 39 Table of Contents On July 13, 2006, the MIIT issued the Circular of the Ministry of Information Industry on Strengthening the Administration of Foreign Investment in Value-added Telecommunications Services.
There is uncertainty as to whether the judgment of United States courts will be directly enforced in Hong Kong, as the United States and Hong Kong do not have a treaty or other arrangements providing for reciprocal recognition and enforcement of judgments of courts of the United States in civil and commercial matters.
There is uncertainty as to whether the judgment of United States courts will be directly enforced in Hong Kong, as the United States and Hong Kong do not have a treaty or other arrangements providing for reciprocal recognition and enforcement of judgments of 41 Table of Contents courts of the United States in civil and commercial matters.
The Bulletin 6 specifies further the provisions in Bulletin 16, regulating the basic rules about the income distribution of intangible properties, payments for labor service and no substantial operating activities and so on. Meanwhile, it abolished the application of Bulletin 16 since May 1, 2017.
The Bulletin 6 specifies further the provisions in Bulletin 16, regulating the basic rules about the income distribution of intangible properties, payments for labor service and no substantial operating activities and so on. 35 Table of Contents Meanwhile, it abolished the application of Bulletin 16 since May 1, 2017.
Any significant security breach or attack on our system could result in a material adverse impact on our reputation, business prospects and results of operations. 29 Table of Contents The successful operation of our business depends upon the performance and reliability of the internet infrastructure in China and the safety of our network and infrastructure.
Any significant security breach or attack on our system could result in a material adverse impact on our reputation, business prospects and results of operations. The successful operation of our business depends upon the performance and reliability of the internet infrastructure in China and the safety of our network and infrastructure.
Our business could be subject to significant disruption and our results of operations may be affected. We may not be able to regain our profitability in the future. In addition, we may not be able to obtain additional capital in a timely manner or on acceptable terms, or at all.
Our business could be subject to significant disruption and our results of operations may be affected. 30 Table of Contents We may not be able to regain our profitability in the future. In addition, we may not be able to obtain additional capital in a timely manner or on acceptable terms, or at all.
The trading performance of 48 Table of Contents these Chinese companies’ securities after their offerings, including the securities of companies in the mobile and PC internet businesses, may affect the attitudes of investors toward Chinese companies listed in the United States, which consequently may impact the trading performance of the ADSs, regardless of our actual operating performance.
The trading performance of these Chinese companies’ securities after their offerings, including the securities of companies in the mobile and PC internet businesses, may affect the attitudes of investors toward Chinese companies listed in the United States, which consequently may impact the trading performance of the ADSs, regardless of our actual operating performance.
For example, in 53 Table of Contents comparison with a private company, we need an increased number of independent directors and have to adopt policies regarding internal controls and disclosure controls and procedures. In addition, we incur additional costs associated with our public company reporting requirements.
For example, in comparison with a private company, we need an increased number of independent directors and have to adopt policies regarding internal controls and disclosure controls and procedures. In addition, we incur additional costs associated with our public company reporting requirements.
Each of these potential outcomes could adversely affect our company's market penetration and growth prospects. We are substantially reliant on our relationships with suppliers and service providers for the parts and components in our robots, as well as for most of our manufacture of our service robots.
Each of these potential outcomes could adversely affect our company's market penetration and growth prospects. We are substantially reliant on our relationships with suppliers and service providers for the parts and components in our robotic products, as well as for most of our manufacture of our robotic products.
In addition, if we were to become subject 24 Table of Contents to the 40 Act, any violation of the 40 Act could subject us to material adverse consequences, including potentially significant regulatory penalties and the possibility that certain of our contracts would be deemed unenforceable.
In addition, if we were to become subject to the 40 Act, any violation of the 40 Act could subject us to material adverse consequences, including potentially significant regulatory penalties and the possibility that certain of our contracts would be deemed unenforceable.
Furthermore, on March 17, 2017, the SAT promulgated the Announcement of the State Administration of Taxation on Promulgating the Administrative Measures for Special Tax Investigation Adjustments and Mutual Agreement Procedures, or Bulletin 34 Table of Contents 6, which become effective as of May 1, 2017.
Furthermore, on March 17, 2017, the SAT promulgated the Announcement of the State Administration of Taxation on Promulgating the Administrative Measures for Special Tax Investigation Adjustments and Mutual Agreement Procedures, or Bulletin 6, which become effective as of May 1, 2017.
This expansion includes recruiting staff who possess the requisite expertise. However, managing and sustaining this growth is both costly and complex. If we are unable to utilize our organization effectively, it could hinder our ability to increase sales, as well as impede the introduction and acceptance of our service robots into new markets.
This expansion includes recruiting staff who possess the requisite expertise. However, managing and sustaining this growth is both costly and complex. If we are unable to utilize our organization effectively, it could hinder our ability to increase sales, as well as impede the introduction and acceptance of our robotic products into new markets.
Fu has breached his contractual obligations of confidentiality, non-competition, non-solicitation and non-disparagement under the agreements Mr. Fu had entered into with a subsidiary of Qihoo prior to his resignation from the subsidiary in August 2008. The complaint asserts that Mr.
Fu has breached his contractual obligations of confidentiality, non-competition, non-solicitation and non-disparagement under the agreements Mr. Fu had entered into with a subsidiary of Qihoo prior to his resignation from the subsidiary in August 2008. In connection with the complaint, Mr.
Many factors, some of which are beyond our control, are important to maintaining and enhancing our brands and may negatively impact our brands and reputation if not properly managed, such as: • our ability to provide a convenient and reliable user experience as user preferences evolve and we expand into new applications; • our ability to increase brand awareness among existing and potential users and customers through various marketing and promotional activities; • our ability to adopt new technologies or adapt our applications to meet user needs or the expectations of our customers; • our ability to maintain and enhance our brands in the face of potential challenges from third parties; • actions by third parties, through whom we collect revenues and perform other business functions, that may affect our reputation; and • our ability to differentiate our brands and products from those of Kingsoft Corporation.
Many factors, some of which are beyond our control, are important to maintaining and enhancing our brands and may negatively impact our brands and reputation if not properly managed, such as: • our ability to provide a convenient and reliable user experience as user preferences evolve and we expand into new applications; • our ability to increase brand awareness and trust among existing and potential users and enterprise customers through various marketing and promotional activities; 25 Table of Contents • our ability to adopt new technologies or adapt our products and services to meet the needs and expectations of both individual users and enterprise customers; • our ability to maintain and enhance our brands in the face of potential challenges from third parties; • actions by third parties, through whom we collect revenues and perform other business functions, that may affect our reputation; and • our ability to differentiate our brands and products from those of Kingsoft Corporation.
The VIEs, together with their subsidiaries, contributed a portion of our consolidated revenues in the years ended December 31, 2022, 2023 and 2024.
The VIEs, together with their subsidiaries, contributed a portion of our consolidated revenues in the years ended December 31, 2023, 2024 and 2025.
We did not hold an annual shareholders’ meeting in 2024. As we rely on the home country practice exemption as described above, our investors may have less protection afforded to shareholders of companies that fully comply with NYSE corporate governance requirements. We may also opt to rely on additional home country practice exemptions in the future.
We did not hold an annual general meeting in 2025. As we rely on the home country practice exemption as described above, our investors may have less protection afforded to shareholders of companies that fully comply with NYSE corporate governance requirements. We may also opt to rely on additional home country practice exemptions in the future.
Under Circular 6, a security review is required for mergers and acquisitions by foreign investors 42 Table of Contents having “national defense and security” concerns and mergers and acquisitions by which foreign investors may acquire the “de facto control” of domestic enterprises with “national security” concerns.
Under Circular 6, a security review is required for mergers and acquisitions by foreign investors having “national defense and security” concerns and mergers and acquisitions by which foreign investors may acquire the “de facto control” of domestic enterprises with “national security” concerns.
In the event that any domestic company, enterprise or natural person merges or acquires a domestic company that has affiliated relationship with it through an overseas company legally established or controlled by such domestic company, enterprise or natural person (the “Affiliated M&A”), the merger and acquisition applications shall be submitted to the MOFCOM for approval.
In the event that any domestic company, enterprise or natural person merges or acquires a domestic company that has affiliated relationship with it through an overseas company legally established or controlled by such domestic company, enterprise or natural person (the “Affiliated M&A”), the merger and acquisition applications shall be submitted 44 Table of Contents to the MOFCOM for approval.
Any failure to perform such filing or rеporting procedures would subject us to administrative penalties by the CSRC which could harm our reputation and may adversely affect our results of operations or financial condition.
Any failure to perform such filing or reporting procedures would subject us to administrative penalties by the CSRC which could harm our reputation and may adversely affect our results of operations or financial condition.
Selected Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) Data For the Year Ended December 31, 2024 Cheetah Mobile Inc.
Selected Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) Data For the Year Ended December 31, 2025 Cheetah Mobile Inc.
Meanwhile, in the dynamic landscape of today’s market, venturing into new business or strengthening our existing business lines, such as service robots and AI-powered business applications, presents us with a complex array of risks and uncertainties that are integral to competing in rapidly evolving industries.
Meanwhile, in the dynamic landscape of today’s market, venturing into new business or strengthening our existing business lines, such as robotic products and AI-powered business applications, presents us with a complex array of risks and uncertainties that are integral to competing in rapidly evolving industries.
If we fail to meet the challenges presented by our overseas operations, our business, financial conditions and results of operations may be adversely affected. • If users do not widely adopt versions of our applications developed for various mobile devices, our business could be adversely affected. • If major mobile application distribution channels change their standard terms and conditions in a manner that is detrimental to us, or terminate their existing relationship with us or our partners, our business, financial condition and results of operations may be materially and adversely affected.
If we fail to meet the challenges presented by our overseas operations, our business, financial conditions and results of operations may be adversely affected. • If users do not widely adopt versions of our applications developed for various mobile devices, our business could be adversely affected. • If major mobile application distribution channels change their standard terms and conditions in a manner that is detrimental to us, or terminate their existing relationship with us or our partners, our business, financial condition and results of operations may be materially and adversely affected. • A severe or prolonged downturn in the global economy could materially and adversely affect our business and financial condition.
Failure to secure supplier agreements for components that may face availability constraints due to supply chain disruptions can result in higher prices for those components, which in turn increases the cost of manufacturing service robots and result in an adverse financial impact on our delivery economics.
Failure to secure supplier agreements for components that may face availability constraints due to supply chain disruptions can result in higher prices for those components, which in turn increases the cost of manufacturing robotic products and result in an adverse financial impact on our delivery economics.
If major mobile application distribution channels change their standard terms and conditions in a manner that is detrimental to us, or terminate their existing relationship with us or our partners, our business, financial condition and results of operations may be materially and adversely affected.
If major software and application distribution channels and co-operation partners change their standard terms and conditions in a manner that is detrimental to us, or terminate their existing relationship with us or our partners, our business, financial condition and results of operations may be materially and adversely affected.
If we are not able to adequately protect our trade secrets, know-how and other confidential information, intellectual property or technology, our business and operating results may be adversely affected. Further, we have been licensed with certain intellectual properties by certain affiliates.
If we are not able to adequately protect our trade secrets, know-how and other confidential information, intellectual property or technology, our business and operating results may be adversely affected. 20 Table of Contents Further, we have been licensed with certain intellectual properties by certain affiliates.
You may not realize a return on your investment in the ADSs and you may even lose your entire investment in the ADSs. 52 Table of Contents You may not receive dividends or other distributions on our Class A ordinary shares and you may not receive any value for them, if it is illegal or impractical to make them available to you.
You may not realize a return on your investment in the ADSs and you may even lose your entire investment in the ADSs. You may not receive dividends or other distributions on our Class A ordinary shares and you may not receive any value for them, if it is illegal or impractical to make them available to you.
Our customers primarily comprise mobile advertising networks and partners, e-commerce companies, mobile application developers and mobile game developers, as well as individual customers, to which we refer traffic, sell advertisements, provide network security and technical services. In 2022, 2023 and 2024, our five largest customers in aggregate contributed approximately 46.3%, 29.2% and 30.3% of our revenues, respectively.
Our customers primarily comprise mobile advertising networks and partners, e-commerce companies, mobile application developers and mobile game developers, as well as individual customers, to which we refer traffic, sell advertisements, provide network security and technical services. In 2023, 2024 and 2025, our five largest customers in aggregate contributed approximately 29.2%, 30.3% and 41.9% of our revenues, respectively.
However, our self-own facility and the independent manufacturing model may introduce new risks due to our limited experience in independent manufacturing.
However, our self-owned facility and the independent manufacturing model may introduce new risks due to our limited experience in independent manufacturing.

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Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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On May 28, 2020, the National People’s Congress issued the Civil Code of the People’s Republic of China (Civil Code), which came into effect in on January 1, 2021, the Civil Code provides a natural person shall have the right of privacy and the personal information of a natural person shall be protected in accordance with law.
On May 28, 2020, the National People’s Congress issued the Civil Code of the People’s Republic of China (Civil Code), which came into effect on January 1, 2021, the Civil Code provides a natural person shall have the right of privacy and the personal information of a natural person shall be protected in accordance with law.
Violations of the regulations regarding outbound investment may result in the imposition of fines and other administrative penalties. For serious violations, criminal liability may arise.
Violations of the regulations regarding outbound investment may result in the imposition of fines and other administrative penalties. For serious violations, criminal liability may arise.
Risk Factors—Risks Relating to Our Business and Industry—Because a limited number of customers contribute to a significant portion of our revenues, our revenues and results of operations could be materially and adversely affected if we were to lose a significant customer or a significant portion of its business.” Marketing We remain focused on driving organic growth for our products and services by improving user experience.
Risk Factors—Risks Relating to Our Business and Industry—Because a limited number of customers contribute to a significant portion of our revenues, our revenues and results of operations could be materially and adversely affected if we were to lose a significant customer or a significant portion of its business.” Marketing We remain focused on driving organic growth for our products and services by continuously improving user experience.
NCA, MIIT, the Ministry of Public Security and CAC jointly launch “Jian Wang 2022” Special Program for Combating Online Infringement and Piracy, focusing on online video, online music, online literature, online news, online live broadcast and other fields to carry out special rectification of copyright and crack down on online infringement. Domain Name .
For example, NCA, MIIT, the Ministry of Public Security and CAC jointly launch “Jian Wang 2022” Special Program for Combating Online Infringement and Piracy, focusing on online video, online music, online literature, online news, online live broadcast and other fields to carry out special rectification of copyright and crack down on online infringement. Domain Name .
Risk Factors—Risks Relating to Doing Business in China—Under the PRC Enterprise Income Tax Law, we may be classified as a PRC “resident enterprise,” which could result in unfavorable tax consequences to us and our shareholders and have a material adverse effect on our results of operations and the value of your investment.” Regulations on Labor Laws and Social Insurance The principal laws that govern employment include: • Labor Law of the People’s Republic of China, promulgated by the Standing Committee of the National People’s Congress on July 5, 1994, effective since January 1, 1995 and amended on August 27, 2009 and December 29, 2018; • Labor Contract Law of the People’s Republic of China, promulgated by the Standing Committee of the National People’s Congress on June 29, 2007 and effective since January 1, 2008 and amended on December 28, 2012; • Implementation Rules of the PRC Labor Contract Law, promulgated by the State Council on September 18, 2008 and effective since September 18, 2008; • Work-related Injury Insurance Regulations, promulgated by the State Council on April 27, 2003 and effective since January 1, 2004 and amended on December 20, 2010; • Interim Regulations on the Collection and Payment of Social Insurance Fees, promulgated by the State Council on January 22, 1999, effective since January 22, 1999 and amended on March 24, 2019; • Social Insurance Law promulgated by the National People’s Congress on October 28, 2010, effective since July 1, 2011 and amended on December 29, 2018; and • Regulations on Unemployment promulgated by the State Council on January 22, 1999, effective since January 22, 1999, and • Regulations on the Administration of Housing Provident Fund promulgated by the State Council on April 3, 1999 and latest revised on March 24, 2019.
Risk Factors—Risks Relating to Doing Business in China—Under the PRC Enterprise Income Tax Law, we may be classified as a PRC “resident enterprise,” which could result in unfavorable tax consequences to us and our shareholders and have a material adverse effect on our results of operations and the value of your investment.” Regulations on Labor Laws and Social Insurance The principal laws that govern employment include: • Labor Law of the People’s Republic of China, promulgated by the Standing Committee of the National People’s Congress on July 5, 1994, effective since January 1, 1995 and amended on August 27, 2009 and December 29, 2018; • Labor Contract Law of the People’s Republic of China, promulgated by the Standing Committee of the National People’s Congress on June 29, 2007 and effective since January 1, 2008 and amended on December 28, 2012; • Implementation Rules of the PRC Labor Contract Law, promulgated by the State Council on September 18, 2008 and effective since September 18, 2008; • Work-related Injury Insurance Regulations, promulgated by the State Council on April 27, 2003 and effective since January 1, 2004 and amended on December 20, 2010; • Interim Regulations on the Collection and Payment of Social Insurance Fees, promulgated by the State Council on January 22, 1999, effective since January 22, 1999 and amended on March 24, 2019; 82 Table of Contents • Social Insurance Law promulgated by the National People’s Congress on October 28, 2010, effective since July 1, 2011 and amended on December 29, 2018; and • Regulations on Unemployment promulgated by the State Council on January 22, 1999, effective since January 22, 1999, and • Regulations on the Administration of Housing Provident Fund promulgated by the State Council on April 3, 1999 and latest revised on March 24, 2019.
For the management of foreign investment, the FIL officially abolishes the “case-by-case approval” system established by Three FDI law, and instead establishes the administration system for foreign investment, amongst others, (i) the negative list—the negative list consists of a list of industry sectors where foreign investments are prohibited (the “Prohibited Sectors”) and a list of industry sectors in which foreign investments are restricted (the “Restricted Sectors”); (ii)the information reporting system—foreign investors or foreign investment entities (FIEs) are required to submit investment information to the competent authorities through the system of enterprises registration and enterprise credibility disclosure; and (iii) the national security review, which will be conducted over foreign investments that affects or may affect the state security.
For the management of foreign investment, the FIL officially abolishes the “case-by-case approval” system established by Three FDI law, and instead establishes the administration system for foreign investment, among others, (i) the negative list—the negative list consists of a list of industry sectors where foreign investments are prohibited (the “Prohibited Sectors”) and a list of industry sectors in which foreign investments are restricted (the “Restricted Sectors”); (ii)the information reporting system—foreign investors or foreign investment entities (FIEs) are required to submit investment information to the competent authorities through the system of enterprises registration and enterprise credibility disclosure; and (iii) the national security review, which will be conducted over foreign investments that affects or may affect the state security.
Meanwhile, the network information content service platforms are required to fulfill their primary responsibilities for management of information contents, strengthen the governance of the network information content ecology on their respective platform, and create a positive, healthy and amicable network culture. 71 Table of Contents Furthermore, the Provisions note that network information content service platforms shall not disseminate any illegal information as aforementioned, and shall take precautions against and resist the dissemination of any adverse information specified in the Provisions, such as information use of exaggerated titles, with serious inconsistency between content and title, hyped gossip, scandals, misdeeds, etc.
Meanwhile, the network information content service platforms are required to fulfill their primary responsibilities for management of information contents, strengthen the governance of the network information content ecology on their respective platform, and create a positive, healthy and amicable network culture. 70 Table of Contents Furthermore, the Provisions note that network information content service platforms shall not disseminate any illegal information as aforementioned, and shall take precautions against and resist the dissemination of any adverse information specified in the Provisions, such as information use of exaggerated titles, with serious inconsistency between content and title, hyped gossip, scandals, misdeeds, etc.
The Circular optimized the foreign exchange administration from the following aspects: promoting the facilitation reform of capital account income payment nationwide; (ii) cancelation of the registration of special refund business; (iii) Simplify the registration and management of certain capital project businesses; (iv) relaxation of domestic foreign exchange loans with export background to purchase foreign exchange and repay; (v) facilitating the use of electronic documents for foreign exchange business; (vi) Optimization the bank’s cross-border e-commerce foreign exchange settlement; (vii) relaxation of business review and endorsement procedures; (viii) supporting banks to innovate financial services.
The Circular optimized the foreign exchange administration from the following aspects: promoting the facilitation reform of capital account income payment nationwide; (ii) cancellation of the registration of special refund business; (iii) Simplify the registration and management of certain capital project businesses; (iv) relaxation of domestic foreign exchange loans with export background to purchase foreign exchange and repay; (v) facilitating the use of electronic documents for foreign exchange business; (vi) Optimization the bank’s cross-border e-commerce foreign exchange settlement; (vii) relaxation of business review and endorsement procedures; (viii) supporting banks to innovate financial services.
Such information shall mainly include: (i) names of vulnerability collection platforms, homepage URL, and Internet content provider (ICP) licenses or recordation numbers, and relevant URLs, official accounts on social networking software and other Internet channels for the release of vulnerability information; (ii) names and certificate numbers of sponsoring entities or individuals, and names and contact information of the principal persons in charge and contact persons of vulnerability collection platforms; (iii) scope and methods of vulnerability collection, rules for vulnerability verification and assessment, rules for instructing relevant responsible parties to fix vulnerabilities, rules for publishing vulnerabilities, rules for verifying registered users' identities, and rules for classified and hierarchical management, among others; (iv) relevant materials on the recordation of hierarchical cybersecurity protection obtained through the Communication Cybersecurity Protection Management System of the MIIT; (v) information on implementation of platform management, among others, in accordance with relevant national standards and industrial standards; and (vi) other information required to be explained, which is required to be submitted by the competent authorities.
Such information shall mainly include: (i) names of vulnerability collection platforms, homepage URL, and Internet content provider (ICP) licenses or recordation numbers, and relevant URLs, official accounts on social networking software and other Internet channels for the release of vulnerability information; (ii) names and certificate numbers of sponsoring entities or individuals, and names and contact information of the principal persons in charge and contact persons 74 Table of Contents of vulnerability collection platforms; (iii) scope and methods of vulnerability collection, rules for vulnerability verification and assessment, rules for instructing relevant responsible parties to fix vulnerabilities, rules for publishing vulnerabilities, rules for verifying registered users' identities, and rules for classified and hierarchical management, among others; (iv) relevant materials on the recordation of hierarchical cybersecurity protection obtained through the Communication Cybersecurity Protection Management System of the MIIT; (v) information on implementation of platform management, among others, in accordance with relevant national standards and industrial standards; and (vi) other information required to be explained, which is required to be submitted by the competent authorities.
Based on the understanding on the current PRC laws, rules and regulations and the M&A Rules of our PRC legal counsel, Global Law Office, prior approval from the CSRC is not required under the M&A Rules for the listing and trading of the ADSs on NYSE because the CSRC approval requirement applies to SPVs that acquired equity interests of any PRC company that are held by PRC companies or individuals controlling such SPV and seek overseas listing, and our PRC subsidiaries were incorporated as wholly foreign-owned enterprises by means of direct investment rather than by merger or acquisition by our company of the equity interest or assets of any “domestic company” as defined under the M&A Rules, and no provision in the M&A Rules classifies the contractual arrangements between our company, our PRC subsidiaries and any of the VIEs, either by each agreement itself or taken as a whole, as a type of acquisition transaction falling under the M&A Rules.
Based on the understanding on the current PRC laws, rules and regulations and the M&A Rules of our PRC legal counsel, Global Law Office, prior approval from the CSRC is not required under the M&A Rules for the listing and trading of the ADSs on NYSE because the CSRC approval requirement applies to SPVs that acquired equity interests of any PRC company that are held by PRC companies or individuals controlling such SPV and seek overseas listing, and our PRC subsidiaries were incorporated as wholly foreign-owned enterprises by means of direct investment rather than by merger or acquisition by our company of the equity interest or assets of any “domestic company” as defined under the M&A Rules, and no provision in the 83 Table of Contents M&A Rules classifies the contractual arrangements between our company, our PRC subsidiaries and any of the VIEs, either by each agreement itself or taken as a whole, as a type of acquisition transaction falling under the M&A Rules.
With respect to those domestic enterprises and natural persons newly covered by NDRC Order 11 who conduct outbound investment projects through controlled overseas enterprises (instead of making direct capital or interests investment, or providing direct financing or guarantee), (i) outbound investment projects involving sensitive countries and regions or sensitive industries will be subject to a verification and approval procedure; (ii) for outbound investment projects other than those involving sensitive countries and regions or sensitive industries, if the total investment from Chinese investor via overseas enterprise under its control exceeds US$300 million (inclusive), investors shall only submit a report to NDRC before the implementation of the project; if the total investment amount from Chinese investor via overseas enterprise under its control is less than US$300 million, then no pre-transaction verification, record-filing or reporting is required.
With respect to those domestic enterprises and natural persons newly covered by NDRC Order 11 who conduct outbound investment projects through controlled overseas enterprises (instead of making direct capital or interests investment, or providing direct financing or guarantee), (i) outbound investment projects involving sensitive countries and regions or sensitive industries will be subject to a verification and approval procedure; (ii) for outbound investment projects other than those involving sensitive countries and regions 75 Table of Contents or sensitive industries, if the total investment from Chinese investor via overseas enterprise under its control exceeds US$300 million (inclusive), investors shall only submit a report to NDRC before the implementation of the project; if the total investment amount from Chinese investor via overseas enterprise under its control is less than US$300 million, then no pre-transaction verification, record-filing or reporting is required.
On January 23, 2019, four relevant government authorities jointly issued the Announcement of Conducting Special Supervision against the Illegal Collection and Use of Personal Information by Apps, pursuant to which, app operators should collect and use personal information in compliance with the Cyber Security Law and should be responsible for the security of personal information obtained from users and take effective measures to strengthen the personal information protection.
On January 23, 2019, four relevant government authorities jointly issued the Announcement of Conducting Special Supervision against the Illegal Collection and Use of Personal Information by Apps, pursuant to which, app operators should collect and use personal information in compliance with the CyberSecurity Law and should be responsible for the security of personal information obtained from users and take effective measures to strengthen the personal information protection.
Pursuant to the Mobile Application Provisions, APP providers and APP distribution platforms shall perform the primary responsibility for information content management, actively cooperate with the State to implement the strategy of trusted identities in cyberspace, establish sound information content security management systems, information content ecological governance systems, data security and personal information protection systems, minor protection systems and other management systems to ensure cyber security and maintain a good network ecology.
Pursuant to the Mobile Application Provisions, APP providers and APP distribution platforms shall perform the primary responsibility for information content management, actively cooperate with the State to implement the strategy of trusted identities in cyberspace, establish sound information content security management systems, information content ecological governance systems, data security and personal information protection systems, minor protection systems and other management systems to ensure cybersecurity and maintain a good network ecology.
Risk Factors—Risks Relating to Our Corporate Structure” for “—If the PRC government finds that the structure we have adopted for our business operations does not comply with PRC governmental restrictions on foreign investment in internet businesses, or if these laws or regulations or interpretations of existing laws or regulations change in the future, we could be subject to severe penalties, including the shutting down of our platform and our 88 Table of Contents business operations” and “—Substantial uncertainties exist with respect to the interpretation and implementation of PRC Foreign Investment Law and how it may impact the viability of our current corporate structure, corporate governance and business operations.” D.
Risk Factors—Risks Relating to Our Corporate Structure” for “—If the PRC government finds that the structure we have adopted for our business operations does not comply with PRC governmental restrictions on foreign investment in internet businesses, or if these laws or regulations or interpretations of existing laws or regulations change in the future, we could be subject to severe penalties, including the shutting down of our platform and our business operations” and “—Substantial uncertainties exist with respect to the interpretation and implementation of PRC Foreign Investment Law and how it may impact the viability of our current corporate structure, corporate governance and business operations.” D.
Risk Factors—Risks Relating to Doing Business in China—We may be adversely affected by the complexity of, and uncertainties and changes in, PRC regulation on mobile and PC internet businesses and companies.” 64 Table of Contents Anti-fatigue Compliance System and Real-name Registration System In 2007, the General Administration of Press and Publication and several other governmental authorities issued a circular requiring the implementation of an “anti-fatigue system” and a real-name registration system by all PRC online games operators in an effort to curb addictive online game play behaviors of minors.
Risk Factors—Risks Relating to Doing Business in China—We may be adversely affected by the complexity of, and uncertainties and changes in, PRC regulation on mobile and PC internet businesses and companies.” Anti-fatigue Compliance System and Real-name Registration System In 2007, the General Administration of Press and Publication and several other governmental authorities issued a circular requiring the implementation of an “anti-fatigue system” and a real-name registration system by all PRC online games operators in an effort to curb addictive online game play behaviors of minors.
For the publication of advertisements for medical treatment, pharmaceuticals, medical devices, agricultural pesticides, veterinary drugs, healthcare food, special formula foods for medical purposes and other advertisements subject to the examination as required by laws, administrative rules and regulations, the advertisement examination authority shall, prior to publication, examine the contents of such advertisements; in the absence of such examination, such advertisements shall not be published.
For the publication of advertisements for medical treatment, pharmaceuticals, medical devices, agricultural pesticides, veterinary drugs, healthcare food, special formula foods for medical 65 Table of Contents purposes and other advertisements subject to the examination as required by laws, administrative rules and regulations, the advertisement examination authority shall, prior to publication, examine the contents of such advertisements; in the absence of such examination, such advertisements shall not be published.
Conew Network is currently engaged in the business of research and development of digital technology, telecommunication technology and relevant products, self-technology transfer, technology service, technology consultancy and computer technology training, sale of self-developed products, graphic design, business consultancy and investment consultancy, all of which are permitted foreign investment industries under Catalogue of Industries for Encouraging Foreign Investment (2022 Version) and Negative List (2024 Version).
Conew Network is currently engaged in the business of research and development of digital technology, telecommunication technology and relevant products, self-technology transfer, technology service, technology consultancy and computer technology training, sale of self-developed products, graphic design, business consultancy and investment consultancy, all of which are permitted foreign investment industries under Catalogue of Industries for Encouraging Foreign Investment (2025 Version) and Negative List (2024 Version).
On April 12, 2023, the CAC, the MIIT, the MPS, the Ministry of Finance and the Certification and Accreditation Administration of the PRC jointly promulgated the Announcement on Matters Relating to the Adjustment of the Security Management of Specialized Cybersecurity Products, pursuant to which, specialized cybersecurity products included in the Catalog of Key Network Equipment and Specific Network Security Products may only be sold or provided after passing the security certification security testing by a qualified institution according to the mandatory requirements of the relevant national standards such as the Information Security Technology-Security Technical Requirements for Specialized Cybersecurity Products.
On April 12, 2023, the CAC, the MIIT, the MPS, the Ministry of Finance and the Certification and Accreditation Administration of the PRC jointly promulgated the Announcement on Matters Relating to the Adjustment of the Security Management of Specialized Cybersecurity Products, pursuant to which, since July 1, 2023, specialized cybersecurity products included in the Catalog of Key Network Equipment and Specific Network Security Products may only be sold or provided after passing the security certification security testing by a qualified institution according to the mandatory requirements of the relevant national standards such as the Information Security Technology-Security Technical Requirements for Specialized Cybersecurity Products.
During the transmission of 74 Table of Contents core data and important data, encryption technology shall be employed to protect the security of transmission; Audit working papers shall be stored within the territory of China pursuant to laws, administrative regulations, and relevant provisions of the State; accounting firms shall establish a data backup system accounting firms shall not incorporate clauses in the engagement letter or similar contracts that involve its provision of domestic project information and data to overseas regulatory bodies.
During the transmission of core data and important data, encryption technology shall be employed to protect the security of transmission; Audit working papers shall be stored within the territory of China pursuant to laws, administrative regulations, and relevant provisions of the State; accounting firms shall establish a data backup system accounting firms shall not incorporate clauses in the engagement letter or similar contracts that involve its provision of domestic project information and data to overseas regulatory bodies.
Our contractual arrangements with each of the VIEs and their shareholders enable us to: • exercise effective control over the VIEs; • receive substantially all of the economic benefits of the VIEs in consideration for the services provided by Beijing Security and Conew Network, our wholly-owned subsidiaries in China; and • have an exclusive option to purchase all of the equity interests in the VIEs, when and to the extent permitted under PRC law, regulations or legal proceedings.
Our contractual arrangements with each of the VIEs and their shareholders enable us to: • exercise effective control over the VIEs; 84 Table of Contents • receive substantially all of the economic benefits of the VIEs in consideration for the services provided by Beijing Security and Conew Network, our wholly-owned subsidiaries in China; and • have an exclusive option to purchase all of the equity interests in the VIEs, when and to the extent permitted under PRC law, regulations or legal proceedings.
Risk Factors—Risks Relating to Doing Business in China—PRC regulations relating to offshore investment activities by PRC residents may limit our PRC subsidiaries’ ability to increase their registered capital or distribute profits to us or otherwise expose us to liability and penalties under PRC law.” In addition, the State Administration for Taxation has issued circulars concerning employee share incentives, under which our employees working in the PRC who exercise share options or are granted restricted shares will be subject to PRC individual income tax.
Risk Factors—Risks Relating to Doing Business in China—PRC regulations relating to offshore investment activities by PRC residents may limit our PRC subsidiaries’ ability to increase their registered capital or distribute profits to us or otherwise expose us to liability and penalties under PRC law.” 80 Table of Contents In addition, the State Administration for Taxation has issued circulars concerning employee share incentives, under which our employees working in the PRC who exercise share options or are granted restricted shares will be subject to PRC individual income tax.
Providers of deep synthesis services shall fulfill their role as the bearer of responsibilities for information security, and establish and improve their user registration, algorithm mechanism and logic review, scientific and technological ethics review, information release review, data security, personal information protection, anti-telecom and online fraud, emergency response and other management systems, along with safe and controllable technical safeguards 68 Table of Contents in place.
Providers of deep synthesis services shall fulfill their role as the bearer of responsibilities for information security, and establish and improve their user registration, algorithm mechanism and logic review, scientific and technological ethics review, information release review, data security, personal information protection, anti-telecom and online fraud, emergency response and other management systems, along with safe and controllable technical safeguards in place.
It remains unclear whether a common foreign- invested enterprise, other than such special types of enterprises as holding companies, venture capital or private equity firms, can use the converted RMB in the designated account to make equity investments if equity investment or the like 79 Table of Contents is not within their approved business scope.
It remains unclear whether a common foreign-invested enterprise, other than such special types of enterprises as holding companies, venture capital or private equity firms, can use the converted RMB in the designated account to make equity investments if equity investment or the like is not within their approved business scope.
Our registered office in the Cayman Islands is located at the offices of Maples Corporate Services Limited at PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands. The SEC maintains an internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC on www.sec.gov .
Our registered office in the Cayman Islands is located at the offices of Maples Corporate Services Limited at PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands. 57 Table of Contents The SEC maintains an internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC on www.sec.gov .
Pursuant to the Administrative Provisions on Algorithm Recommendation, users should be given an option to easily turn off algorithm recommendation services, and service providers shall, among others, establish and improve the management systems and technical measures for algorithm driven recommendation mechanism and regularly review, evaluate and verify the principle, models, data and application results of algorithms.
Pursuant to the Administrative Provisions on Algorithm Recommendation, users should be given an option to easily turn off algorithm recommendation services, and service providers shall, among others, establish and improve the management systems and 67 Table of Contents technical measures for algorithm driven recommendation mechanism and regularly review, evaluate and verify the principle, models, data and application results of algorithms.
Foreign investors are not allowed to indirectly control or participate in PRC operating companies’ online games (including online mobile and PC games) operations, whether (a) by establishing other joint ventures, entering into contractual arrangements or providing technical support for such operating companies; or (b) in a disguised form such as by incorporating or directing user registration, user account management or game card consumption into online gaming platforms that are ultimately controlled or owned by foreign companies.
Foreign investors are not allowed to indirectly control or participate in PRC operating companies’ online games (including online mobile and PC games) operations, whether (a) by establishing other joint ventures, entering into contractual arrangements or providing technical support for such operating companies; or (b) in a disguised form such as by incorporating or directing user registration, user account management or game card consumption into online 64 Table of Contents gaming platforms that are ultimately controlled or owned by foreign companies.
Failure to comply with these laws and regulations could result in claims, changes to our business practices, monetary penalties, increased cost of operations, or declines in user growth or engagement, or otherwise harm our business.” 60 Table of Contents As a significant portion of our business operations are conducted in China, we are materially affected by the laws and regulations in China.
Failure to comply with these laws and regulations could result in claims, changes to our business practices, monetary penalties, increased cost of operations, or declines in user growth or engagement, or otherwise harm our business.” As a significant portion of our business operations are conducted in China, we are materially affected by the laws and regulations in China.
The Personal Information Protection Law requires, among others, that (i) the processing of personal information should have a clear and reasonable purpose which should be directly related to the processing purpose, in a method that has the least impact on personal rights and interests, and (ii) the collection of personal information should be limited to the minimum scope necessary to achieve the processing purpose to avoid the excessive collection of personal information.
The Personal Information Protection Law requires, among others, that (i) the processing of personal information should have a clear and reasonable purpose which should be directly related to the processing purpose, in a method that has the least impact on personal rights and interests, and (ii) the collection of personal information should be limited to the minimum 71 Table of Contents scope necessary to achieve the processing purpose to avoid the excessive collection of personal information.
However, as of the date of this annual report, we have not received any formal notice from any cybersecurity regulator that we should apply for a cybersecurity review. 75 Table of Contents On October 25, 2022, the MIIT issued the Measures for the Administration of Recordation of Network Product Security Vulnerability Collection Platforms, or the Provisions.
However, as of the date of this annual report, we have not received any formal notice from any cybersecurity regulator that we should apply for a cybersecurity review. On October 25, 2022, the MIIT issued the Measures for the Administration of Recordation of Network Product Security Vulnerability Collection Platforms, or the Provisions.
On January 9, 2023, Live.me modified its share capital by dividing ordinary shares into Class A ordinary shares and Class B ordinary shares with different voting rights, subsequent to the modification, we hold 49.6% of Live.me’s share capital, which stands for 49.6% equity interest and 17.25% voting rights of Live.me.
On January 9, 56 Table of Contents 2023, Live.me modified its share capital by dividing ordinary shares into Class A ordinary shares and Class B ordinary shares with different voting rights, subsequent to the modification, we hold 49.6% of Live.me’s share capital, which stands for 49.6% equity interest and 17.25% voting rights of Live.me.
Operators of such apps shall not refuse to provide basic services to users on the ground of users’ refusal to provide their personal non-essential information. 72 Table of Contents On August 20, 2021, the Standing Committee of the National People’s Congress adopted the Personal Information Protection Law which took effect on November 1, 2021.
Operators of such apps shall not refuse to provide basic services to users on the ground of users’ refusal to provide their personal non-essential information. On August 20, 2021, the Standing Committee of the National People’s Congress adopted the Personal Information Protection Law which took effect on November 1, 2021.
An amendment to the registration is required if there is a material change in the SPV registered, such as any change of basic information (including change of such PRC residents, name and operation term), increases or decreases in investment 81 Table of Contents amount, transfers or exchanges of shares, or mergers or divisions.
An amendment to the registration is required if there is a material change in the SPV registered, such as any change of basic information (including change of such PRC residents, name and operation term), increases or decreases in investment amount, transfers or exchanges of shares, or mergers or divisions.
However, if non-resident enterprises have not formed permanent establishments or premises in the PRC, or if their 82 Table of Contents permanent establishment or premises in the PRC have no actual relationship to the relevant income derived in the PRC, enterprise income tax is set at the rate of 10% with respect to their income sourced from inside the PRC.
However, if non-resident enterprises have not formed permanent establishments or premises in the PRC, or if their permanent establishment or premises in the PRC have no actual relationship to the relevant income derived in the PRC, enterprise income tax is set at the rate of 10% with respect to their income sourced from inside the PRC.
It was the first national securities law in the PRC, and is divided into 14 chapters and 226 articles comprehensively regulating activities in the PRC securities market, including the issue and trading of securities, takeovers by listed companies, securities exchanges, securities companies and the duties and 85 Table of Contents responsibilities of the State Council’s securities regulatory authorities.
It was the first national securities law in the PRC, and is divided into 14 chapters and 226 articles comprehensively regulating activities in the PRC securities market, including the issue and trading of securities, takeovers by listed companies, securities exchanges, securities companies and the duties and responsibilities of the State Council’s securities regulatory authorities.
Besides, the ICP Measures and other relevant measures also ban the internet activities that constitute publication of any content that propagates obscenity, 62 Table of Contents pornography, gambling and violence, incite the commission of crimes or infringe upon the lawful rights and interests of third parties, among others.
Besides, the ICP Measures and other relevant measures also ban the internet activities that constitute publication of any content that propagates obscenity, pornography, gambling and violence, incite the commission of crimes or infringe upon the lawful rights and interests of third parties, among others.
Failure to comply with these consumer protection laws could subject us to administrative sanctions, such as the issuance of warning, 67 Table of Contents confiscation of income, imposition of fines, order to cease business operations, revocation of business licenses, as well as potential civil and criminal liabilities.
Failure to comply with these consumer protection laws could subject us to administrative sanctions, such as the issuance of warning, confiscation of income, imposition of fines, order to cease business operations, revocation of business licenses, as well as potential civil and criminal liabilities.
To the best of our PRC legal counsel’s knowledge after due inquiries, none of our PRC subsidiaries and VIEs or their respective assets is entitled to any immunity, on the grounds of sovereignty, from any action, suit or other legal proceedings, or from enforcement, execution or attachment.
To the best of our PRC legal counsel’s knowledge after due inquiries, none of our PRC 86 Table of Contents subsidiaries and VIEs or their respective assets is entitled to any immunity, on the grounds of sovereignty, from any action, suit or other legal proceedings, or from enforcement, execution or attachment.
Regulations on Internet Infringement On May 26, 2020, the National People’s Congress promulgated the Civil Code of the People’s Republic of China, or the Civil Code, which became effective on January 1, 2021.
Regulations on Internet Infringement On May 28, 2020, the National People’s Congress promulgated the Civil Code of the People’s Republic of China, or the Civil Code, which became effective on January 1, 2021.
Except under certain specific circumstances provided by law, any third-party user must obtain consent or a proper license from the patent owner to use the patent, or else the use will constitute an infringement of the rights of the patent holder. 69 Table of Contents Copyright .
Except under certain specific circumstances provided by law, any third-party user must obtain consent or a proper license from the patent owner to use the patent, or else the use will constitute an infringement of the rights of the patent holder. Copyright .
After the losses have been made up and common reserves have been drawn, the remaining profits shall be distributed to shareholders in proportion to the actual capital contribution actually paid by them, unless otherwise stipulated in the company’s articles of association.
After the losses have been made up and common reserves have been drawn, the remaining 79 Table of Contents profits shall be distributed to shareholders in proportion to the actual capital contribution actually paid by them, unless otherwise stipulated in the company’s articles of association.
Upon the completion of the investment, 55 Table of Contents our equity interest in Beijing OrionStar is 72.10%, without taking into account the stake it holds indirectly through the Fund; we hold, both directly and indirectly, 73.95% equity interest in Beijing OrionStar, including the stake it holds indirectly through the Fund.
Upon the completion of the investment, our equity interest in Beijing OrionStar is 72.10%, without taking into account the stake it holds indirectly through the Fund; we hold, both directly and indirectly, 73.95% equity interest in Beijing OrionStar, including the stake it holds indirectly through the Fund.
Risk Factors—Risks Relating to Our Business and Industry—Our business is subject to complex and evolving laws and regulations regarding privacy, data protection, and other matters outside China.
Risk Factors—Risks Relating to Our Business and Industry—Our business is subject to complex and evolving laws and regulations regarding privacy, data protection, and other matters.
Property, Plants and Equipment As of December 31, 2024, our principal executive offices were located on leased premises comprising approximately 8,819 square meters in Beijing, China. This facility accommodates our management headquarters, principal development, engineering, legal, finance and administrative activities. We also have offices overseas, mainly in Japan.
Property, Plants and Equipment As of December 31, 2025, our principal executive offices were located on leased premises comprising approximately 8,899 square meters in Beijing, China. This facility accommodates our management headquarters, principal development, engineering, legal, finance and administrative activities. We also have offices overseas, mainly in Japan.
This agreement will be effective unless terminated according to the terms of the agreement or otherwise terminated by mutual agreement of the signing parties. 87 Table of Contents Agreements that provide us with the option to purchase the equity interest in Beijing Mobile Loan agreements .
This agreement will be effective unless terminated according to the terms of the agreement or otherwise terminated by mutual agreement of the signing parties. Agreements that provide us with the option to purchase the equity interest in Beijing Mobile Loan agreements .
Sheng Fu, our chief executive officer and director, pursuant to which Kingsoft Corporation agreed to delegate voting rights pertaining to up to 399,445,025 Class B ordinary shares of our company that it owns to Mr. Fu. Pursuant to which, Kingsoft Corporation has delegated approximately 37.4% voting power of our company held by Kingsoft Corporation to Mr.
Sheng Fu, our chief executive officer and director, pursuant to which Kingsoft Corporation agreed to delegate voting rights pertaining to up to 399,445,025 Class B ordinary shares of our company that it owns to Mr. Fu. Pursuant to which, Kingsoft Corporation has delegated approximately 36.6% voting power of our company held by Kingsoft Corporation to Mr.
All the software copyrights owned by the VIEs have been published between December 2012 and March 2025. Software copyrights are protected until the end of the 50th calendar year starting from the date of first publication. Trademarks . As of March 31, 2025, we had registered 3,354 trademarks in mainland China.
All the software copyrights owned by the VIEs have been published between December 2012 and March 2026. Software copyrights are protected until the end of the 50th calendar year starting from the date of first publication. Trademarks . As of March 31, 2026, we had registered 3,078 trademarks in mainland China.
We may be subject to adverse tax consequences if the PRC tax authorities were to determine that the contracts between us and the VIEs were not on an arm’s length basis and therefore constituted improper transfer pricing arrangements. See “Item 3. Key Information—D.
We may be subject to adverse tax consequences if the 81 Table of Contents PRC tax authorities were to determine that the contracts between us and the VIEs were not on an arm’s length basis and therefore constituted improper transfer pricing arrangements. See “Item 3. Key Information—D.
In July 2014, the SAFE promulgated the Circular on Relevant Issues Relating to Domestic Resident’s Investment and Financing and Round-trip Investment through Special Purpose Vehicles, or SAFE Circular 37, in July 2014, which repealed SAFE Circular 75 effective from July 4, 2014.
In July 2014, the SAFE promulgated the Circular on Relevant Issues Relating to Domestic Resident’s Investment and Financing and Round-trip Investment through Special Purpose Vehicles, or SAFE Circular 37, which repealed SAFE Circular 75.
The Internet Measures classified Internet information services into commercial Internet information services and non-commercial Internet information services and a commercial operator of Internet content provision services must obtain a value–added telecommunications services license for the provision of Internet information services from the appropriate telecommunications authorities.
The Internet Measures classified Internet information services into commercial Internet information services and non-commercial Internet information services and a commercial operator of Internet 62 Table of Contents content provision services must obtain a value–added telecommunications services license for the provision of Internet information services from the appropriate telecommunications authorities.
On April 3 2024, the SAFE promulgated the Guidelines of Capital Account Foreign Exchange Business (2024 Version), which came into effect on May 6, 2024, and stipulate guidelines for the capital account foreign exchange business. Foreign Debt.
On April 3, 2024, the SAFE promulgated the Guidelines of Capital Account Foreign Exchange Business (2024 Version), which came into effect on May 6, 2024, and stipulate guidelines for the capital account foreign exchange business. 78 Table of Contents Foreign Debt.
On October 25, 2019, the General Administration of Press and Publication issued the Notice on Preventing Minor’s Addiction to Online Games, which requires all online gamers to register accounts with their valid identity information and all game companies to stop providing game services to users who fail to do so.
On October 25, 2019, the General Administration of Press and Publication issued the Notice on Preventing Minor’s Addiction to Online Games and a further Notice on August 30, 2021, which requires all online gamers to register accounts with their valid identity information and all game companies to stop providing game services to users who fail to do so.
Regulations that apply to advertising business primarily include: • Advertisement Law of the People’s Republic of China, promulgated by the Standing Committee of the National People’s Congress on October 27, 1994 and effective since February 1, 1995, the latest version of which became effective on April 29, 2021; • Interim Measures for the Administration of Internet Advertisements, promulgated by the SAIC on July 4, 2016 and effective on September 1, 2016; and • Advertisement Law and the Measures for the Administration of Internet Advertisements, promulgated by the SAMR on February 25, 2023 and implemented on May 1, 2023.
Regulations that apply to advertising business primarily include: • Advertisement Law of the People’s Republic of China, promulgated by the Standing Committee of the National People’s Congress on October 27, 1994 and effective since February 1, 1995, the latest version of which became effective on April 29, 2021; • Advertisement Law and the Measures for the Administration of Internet Advertisements, promulgated by the SAMR on February 25, 2023 and implemented on May 1, 2023.
Among such patent applications, in relation to the proprietary technologies that are essential to the operations of our platform and important to our business, our wholly-owned or controlled subsidiaries, had independently filed 168 patent applications, and the VIEs, had independently or jointly filed 5 patent applications.
Among such patent applications, in relation to the proprietary technologies that are essential to the operations of our platform and important to our business, our wholly-owned or controlled subsidiaries, had independently filed 124 patent applications, and the VIEs, had independently or jointly filed 4 patent applications.
As of December 31, 2024, we also leased some facilities in multiple cities across China. These facilities were mainly used as production factories and warehouses, with a total combined floor area of approximately 5,305 square meters. Our products and services are mainly deployed on various cloud service providers such as Tencent and Amazon.
As of December 31, 2025, we also leased some facilities in multiple cities across China. These facilities were mainly used as production factories and warehouses, with a total combined floor area of approximately 6,120 square meters. Our products and services are mainly deployed on various cloud service providers such as Tencent and Amazon.
Although such registration is not mandatory under PRC law, software owners, licensees and transferees are encouraged to go through the registration process and registered software rights may be entitled to better protections. Patent .
Although such registration is not mandatory under PRC law, software owners, licensees and transferees are encouraged to go through the registration process and registered software rights may be entitled to better protections. 68 Table of Contents Patent .
According to the Confidentiality and Archives Administration Provisions, during the course of an overseas offering and listing, if a domestic enterprise needs to publicly disclose or provide to securities companies, accounting firms or other securities service providers and overseas regulators, any materials that contain relevant state secrets, government work secrets or that have a sensitive impact (i.e. any documents and materials that contain state secrets or working secrets of government agencies, or any other documents and materials that will be detrimental to national security or public interest if leaked), the domestic enterprise shall strictly fulfill relevant procedures stipulated by applicable national regulations.
According to the Confidentiality and Archives Administration Provisions, during the course of an overseas offering and listing, if a domestic enterprise needs to publicly disclose or provide to securities companies, accounting firms or other securities service providers and overseas regulators, any materials that contain relevant state secrets, government work secrets or that have a sensitive impact (i.e. any documents and materials that contain state secrets or working secrets of government agencies, or any other documents and materials that will be detrimental to national security or public interest if leaked), the domestic enterprise shall strictly fulfill relevant procedures stipulated by applicable national regulations. 77 Table of Contents Regulations of Foreign Currency Exchange, Foreign Debt and Dividend Distribution Foreign Currency Exchange .
On August 1, 2011, the State Council promulgated the Administrative Measures for the Security Protection of Computer Information Networks Linked to the Internet (2011Revised) and became effective on August 1, 2011, The Measures shall be applicable to the security protection administration of the international networking of computer information networks.
On January 8, 2011, the State Council promulgated the Administrative Measures for the Security Protection of Computer Information Networks Linked to the Internet (2011Revised) and became effective on January 8, 2011, The Measures shall be applicable to the security protection administration of the international networking of computer information networks.
Organizational Structure—Contractual Arrangements with the VIEs.” Based on our PRC legal counsel, Global Law Office’s understanding of the current PRC laws, rules and regulations, our corporate structure complies with all applicable PRC laws, and does not violate, breach, contravene or circumvent or otherwise conflict with any applicable PRC laws.
Based on our PRC legal counsel, Global Law Office’s understanding of the current PRC laws, rules and regulations, our corporate structure complies with all applicable PRC laws, and does not violate, breach, contravene or circumvent or otherwise conflict with any applicable PRC laws.
We currently, through Beijing Network and other companies, the VIEs or their subsidiaries, hold valid ICP Licenses, covering the provision of internet information services, issued by the Beijing, Guangdong or Hainan branch of the MIIT.
We currently, through Beijing Network, Beijing Lingbao and other companies, hold valid ICP Licenses, covering the provision of internet information services, issued by the Beijing, Guangdong or Hainan branch of the MIIT.
In relation to our core proprietary technologies, Beijing Mobile and Beijing Network, and our other VIEs, independently or jointly owned 183 software copyrights, Zhuhai Juntian, Beijing Security, Conew Network, Beijing OrionStar and our other wholly-owned or controlled subsidiaries independently or jointly owned 473 software copyrights, and 44 software copyrights were jointly owned by our wholly-owned subsidiaries and VIEs.
In relation to our core proprietary technologies, Beijing Mobile and Beijing Network, and our other VIEs, independently or jointly owned 115 software copyrights, Zhuhai Juntian, Beijing Security, Conew Network, Beijing OrionStar, UFACTORY and our other wholly-owned or controlled subsidiaries independently or jointly owned 583 software copyrights, and 44 software copyrights were jointly owned by our wholly-owned subsidiaries and VIEs.
Moreover, the Data Security Law provides a national security review procedure for those data activities which affect or may affect national security and imposes export restrictions on certain data and information.
Moreover, the Data Security Law provides a national security review procedure for those 72 Table of Contents data activities which affect or may affect national security and imposes export restrictions on certain data and information.
Key Information—Our Holding Company Structure and Contractual Arrangements with the Consolidated Variable Interest Entities.” Pursuant to Catalogue of Industries for Encouraging Foreign Investment (2022 Version) and Negative List (2024 Version), Beijing Security is currently engaged in the business of technology promotion, technology development, technology service and technology consultancy, sale of computers, software, auxiliary devices and AI hardware, computer animation design, investment consultancy and advertisement design, production, agency and publication, all of which are permitted foreign 86 Table of Contents investment industries under Catalogue of Industries for Encouraging Foreign Investment (2022 Version) and Negative List (2024 Version).
Key Information—Our Holding Company Structure and Contractual Arrangements with the Consolidated Variable Interest Entities.” Pursuant to Catalogue of Industries for Encouraging Foreign Investment (2025 Version) and Negative List (2024 Version), Beijing Security is currently engaged in the business of technology promotion, technology development, technology service and technology consultancy, sale of computers, software, auxiliary devices and AI hardware, computer animation design, investment consultancy and advertisement design, production, agency and publication.
Under the exclusive technology development, support and consultancy agreement between Beijing Security and Beijing Mobile, Beijing Security has the exclusive right to provide Beijing Mobile with services related to Beijing Mobile’s business, including but not limited to technology development, support and consulting services.
Agreement that transfers economic benefits to us Exclusive technology development, support and consultancy agreement . Under the exclusive technology development, support and consultancy agreement between Beijing Security and Beijing Mobile, Beijing Security has the exclusive right to provide Beijing Mobile with services related to Beijing Mobile’s business, including but not limited to technology development, support and consulting services.
On February 18, 1994, the State Council promulgated the Provisions for Security Protection of Computer Information Systems and subsequently amended in 2011.
Regulations on Personal Computer Products and Services On February 18, 1994, the State Council promulgated the Provisions for Security Protection of Computer Information Systems and subsequently amended in 2011.
This section summarizes the principal PRC laws and regulations relevant to our current businesses, including online marketing, online game (including online mobile and PC games) operations and advertising agency, as well as foreign currency exchange and dividend distributions.
This section summarizes the principal PRC laws and regulations relevant to our current businesses, including online marketing, and advertising agency, as well as foreign currency exchange and dividend distributions.
External revenues contributed by the VIEs and the then subsidiaries of the VIEs together accounted for 31.8%, 42.9% and 35.0% of our revenues for the years ended December 31, 2022, 2023 and 2024, respectively.
External revenues contributed by the VIEs and the then subsidiaries of the VIEs together accounted for 42.9%, 35.0% and 29.2% of our revenues for the years ended December 31, 2023, 2024 and 2025, respectively.
Trademark license agreements must be filed with the Trademark Office for record. On December 13, 2021, for the purposes of enhancing trademark administration, strengthening the business guidance for trademark law enforcement China National Intellectual Property Administration issued the Standards for Determining General Trademark Violations, or the Circular 34, which became effective on January 1, 2022.
On December 13, 2021, for the purposes of enhancing trademark administration, strengthening the business guidance for trademark law enforcement China National Intellectual Property Administration issued the Standards for Determining General Trademark Violations, or the Circular 34, which became effective on January 1, 2022.
Implementing Rules of the Patent Law of the People's Republic of China was promulgated on January 19, 1985 and was last amended on January 9, 2010 and effective on February 1, 2010 by the State Council. A patentable invention, utility model or design must meet three conditions: novelty, inventiveness and practical applicability.
Implementing Rules of the Patent Law of the People's Republic of China was promulgated on January 19, 1985 and was last amended on December 11, 2023 and effective on January 20, 2024 by the State Council. A patentable invention, utility model or design must meet three conditions: novelty, inventiveness and practical applicability.
Following our incorporation in July 2009, we underwent a series of restructuring transactions in 2009 and 2010. After the restructuring, Zhuhai Juntian, which was originally a wholly-owned subsidiary of Kingsoft Corporation in China, became a 54 Table of Contents wholly-owned subsidiary of Forward Vision in December 2009.
Following our incorporation in July 2009, we underwent a series of restructuring transactions in 2009 and 2010. After the restructuring, Zhuhai Juntian, which was originally a wholly-owned subsidiary of Kingsoft Corporation in China, became a wholly-owned subsidiary of Forward Vision in December 2009. Zhuhai Juntian incorporated Beijing Security as its wholly-owned subsidiary in China in November 2009.
In addition, we enter into confidentiality and 59 Table of Contents non-disclosure agreements with our employees and customers. The agreements we enter into with our employees also provide that all software, inventions, developments, works of authorship and trade secrets created by them during the course of their employment are our property. Patents .
The agreements we enter into with our employees also provide that all software, inventions, developments, works of authorship and trade secrets created by them during the course of their employment are our property. Patents .
Regulations of Foreign Currency Exchange, Foreign Debt and Dividend Distribution Foreign Currency Exchange . The core regulations governing foreign currency exchange in China are the Foreign Exchange Administration Regulations, as amended in August 2008, or the FEA Regulations.
The core regulations governing foreign currency exchange in China are the Foreign Exchange Administration Regulations, as amended in August 2008, or the FEA Regulations.
As of March 31, 2025, we had 1,767 patents in mainland China and 169 patents outside mainland China relating to our software and other proprietary technology.
As of March 31, 2026, we had 1,457 patents in mainland China and 160 patents outside mainland China relating to our software and other proprietary technology.
Zhuhai Juntian incorporated Beijing Security as its wholly-owned subsidiary in China in November 2009. Through a series of VIE contractual arrangements established in January 2011, Beijing Cheetah Mobile Technology Co., Ltd., or Beijing Mobile, an entity previously consolidated in Kingsoft Corporation’s group, became our VIE. We established Cheetah Mobile America, Inc. in the United States in November 2012.
Through a series of VIE contractual arrangements established in January 2011, Beijing Cheetah Mobile Technology Co., Ltd., or Beijing Mobile, an entity previously consolidated in Kingsoft Corporation’s group, became our VIE. We established Cheetah Mobile America, Inc. in the United States in November 2012.
Of such total 1,936 patents, 1,768 patents were either independently or jointly held by Zhuhai Juntian, Beijing Security, Conew Network, Beijing OrionStar and our other wholly-owned or controlled subsidiaries. 117 patents were either independently or jointly held by Beijing Mobile, Beijing Network, and our other VIEs, and 51 patents were jointly owned by our wholly-owned subsidiaries and VIEs.
Of such total 1,617 patents, 1,497 patents were either independently or jointly held by Zhuhai Juntian, Beijing Security, Conew Network, Beijing OrionStar, UFACTORY and our other wholly-owned or controlled subsidiaries. 82 patents were either independently or jointly held by Beijing Mobile, Beijing Network, and our other VIEs, and 38 patents were jointly owned by our wholly-owned subsidiaries and VIEs.
The MIIT will organize the evaluation of the implementation of the Pilot Program. 61 Table of Contents To comply with such foreign ownership restrictions, we operate our businesses in China through Beijing Mobile, Beijing Network, Beijing Conew and other companies, the VIEs or their subsidiaries. The VIEs are directly or indirectly owned by PRC citizens.
The MIIT will organize the evaluation of the implementation of the Pilot Program. To comply with such foreign ownership restrictions, we operate our businesses in China through Beijing Mobile, Beijing Network, and other companies, the VIEs or their subsidiaries.
Regulations that apply to outbound investments primarily include: • Administrative Measures for Outbound Investment by Enterprises, or the NDRC Order No. 11, promulgated by NDRC on December 26, 2017, effective since March 1, 2018 (NDRC Order No. 11); • Catalogue of Investment Projects Subject to Government Verification and Approval (2016 Version), promulgated by the State Council on December 12, 2016, effective since then; • Administrative Measures for Outbound Investment, issued by the MOFCOM on September 6, 2014, effective since October 6, 2014; and • Notice of the State Administration of Foreign Exchange on Further Simplifying and Improving the Policies of Foreign Exchange Administration Applicable to Direct Investment, promulgated by the SAFE on February 13, 2015, effective on 76 Table of Contents June 1, 2015.
Regulations that apply to outbound investments primarily include: • Administrative Measures for Outbound Investment by Enterprises, or the NDRC Order No. 11, promulgated by NDRC on December 26, 2017, effective since March 1, 2018 (NDRC Order No. 11); • Catalogue of Investment Projects Subject to Government Verification and Approval (2016 Version), promulgated by the State Council on December 12, 2016, effective since then; and • Administrative Measures for Outbound Investment, issued by the MOFCOM on September 6, 2014, effective since October 6, 2014.
The ADSs are listed on the NYSE under the symbol “CMCM.” Since September 2016, we have incorporated Live.me Inc. (“Live.me”), a Cayman Islands company, and several subsidiaries including Hong Kong LiveMe Corporation Limited, to operate our live streaming business. In December 2016, Live.me Inc. entered into an agreement to issue certain number of shares to one of its management members.
(“Live.me”), a Cayman Islands company, and several subsidiaries including Hong Kong LiveMe Corporation Limited, to operate our live streaming business. In December 2016, Live.me Inc. entered into an agreement to issue certain number of shares to one of its management members.
For example, a processor of important data is required to designate the personnel and the management body responsible for data security, 73 Table of Contents carry out risk assessments of its data processing activities and file the risk assessment reports with the competent authorities.
The appropriate level of protection measures is required to be taken for each respective category of data. For example, a processor of important data is required to designate the personnel and the management body responsible for data security, carry out risk assessments of its data processing activities and file the risk assessment reports with the competent authorities.
Once approved, depending on the type of patents, the patents that are in the process of application by the VIEs will normally expire 10 or 20 years after the date of application. Copyrights . As of March 31, 2025, we had registered 791 copyrights, including 700 software copyrights and 91 artwork copyrights.
Once approved, depending on the type of patents, the patents that are in the process of application will normally expire 10 or 20 years after the date of application. 60 Table of Contents Copyrights . As of March 31, 2026, we had registered 837 copyrights, including 742 software copyrights and 95 artwork copyrights.
As a result, the application, interpretation, and enforcement of these laws and regulations are often uncertain, particularly in the new and rapidly evolving industry in which we operate, and may be interpreted and applied inconsistently from country to country and inconsistently with our current policies and practices. For further details, see “Item 3. Key Information—D.
As a result, the application, interpretation, and enforcement of these laws and regulations are often uncertain, particularly in the new and rapidly evolving industry in which we operate. For further details, see “Item 3. Key Information—D.

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Item 5. Market for Registrant's Common Equity

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Under the EIT Law and its implementation rules, dividends, interests, rents or royalties payable by a foreign-invested enterprise, such as our PRC subsidiaries, to any of its non-resident enterprise investors, and proceeds from any such non-resident enterprise investor’s disposition of assets (after deducting the net value of such assets) shall be subject to 10% EIT, namely withholding tax, unless non-resident enterprise investor’s jurisdiction of incorporation has a tax treaty or agreement with China that provides for a reduced withholding tax rate or an exemption from withholding tax.
Under the EIT Law and its implementation rules, dividends, interests, rents or royalties payable by a foreign-invested enterprise, such as our PRC subsidiaries, to any of its non-resident enterprise investors, and proceeds from any such non-resident enterprise investor’s disposition of assets (after deducting the net value of such assets) shall be subject to 10% withholding tax, unless non-resident enterprise investor’s jurisdiction of incorporation has a tax treaty or agreement with China that provides for a reduced withholding tax rate or an exemption from withholding tax.
We are a Cayman Islands company and to comply with these foreign ownership restrictions, we operate our website and conduct substantially the majority of our distribution and operation of internet value-added services and internet security services businesses in the PRC through the VIEs.
We are a Cayman Islands exempted company and to comply with these foreign ownership restrictions, we operate our website and conduct substantially the majority of our distribution and operation of internet value-added services and internet security services businesses in the PRC through the VIEs.
Trend Information Other than as disclosed elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for the year ended December 31, 2024 that are reasonably likely to have a material and adverse effect on our net revenues, income, profitability, liquidity or capital resources, or that would cause the disclosed financial information to be not necessarily indicative of future results of operations or financial conditions.
Trend Information Other than as disclosed elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for the year ended December 31, 2025 that are reasonably likely to have a material and adverse effect on our net revenues, income, profitability, liquidity or capital resources, or that would cause the disclosed financial information to be not necessarily indicative of future results of operations or financial conditions.
For the years ended December 31, 2023 and 2024, our subsidiaries incorporated in Japan are all with paid-in capital of no more than JPY100 million, and were subject to national corporate income tax rate of 15% on the first JPY8 million of income earned and at 23.2% on any income earned in excess of JPY8 million.
For the years ended December 31, 2024 and 2025, our subsidiaries incorporated in Japan are all with paid-in capital of no more than JPY100 million, and were subject to national corporate income tax rate of 15% on the first JPY8 million of income earned and at 23.2% on any income earned in excess of JPY8 million.
For the year ended December 31, 2023 and 2024, our PRC subsidiaries and VIEs qualified as “high and new technology enterprise” and located in Hengqin-Guangdong-Macao In-depth Cooperation Zone were subject to tax holiday or a preferential tax rate of 15%, and our remaining PRC subsidiaries, VIEs and the subsidiaries of the VIEs were subject to enterprise income tax at a rate of 25%.
For the year ended December 31, 2024 and 2025, our PRC subsidiaries and VIEs qualified as “high and new technology enterprise” and located in Hengqin-Guangdong-Macao In-depth Cooperation Zone were subject to tax holiday or a preferential tax rate of 15%, and our remaining PRC subsidiaries, VIEs and the subsidiaries of the VIEs were subject to enterprise income tax at a rate of 25%.
The on-premise software licence and the post-contract services are accounted for a single performance obligation as post-contract services are mainly provided to answer questions about the use and the installation of the software which would not constitute a promise to a customer. Revenue is recognized upfront at the point in time when the software is made available to the customer.
The on-premise software license and the post-contract services are accounted for a single performance obligation as post-contract services are mainly provided to answer questions about the use and the installation of the software which would not constitute a promise to a customer. Revenue is recognized upfront at the point in time when the software is made available to the customer.
In addition, payments of dividends from our Hong Kong subsidiary to us are not subject to any withholding tax in Hong Kong. Singapore . Our subsidiaries incorporated in Singapore were subject to Singapore corporate income tax rate of 17% for the year ended December 31, 2023 and 2024. Japan .
In addition, payments of dividends from our Hong Kong subsidiary to us are not subject to any withholding tax in Hong Kong. Singapore . Our subsidiaries incorporated in Singapore were subject to Singapore corporate income tax rate of 17% for the year ended December 31, 2024 and 2025. Japan .
Impairment Assessment on Goodwill, Long-lived Assets and Intangible assets We test annually, or whenever events or circumstances indicate that the carrying value of assets exceeds the recoverable amounts, whether goodwill and intangible assets with indefinite lives have suffered any impairment in accordance with the accounting policy stated in Note 2 to our audited consolidated financial statements included in this annual report.
Impairment Assessment on Goodwill, Long-lived Assets and Intangible assets 99 Table of Contents We test annually, or whenever events or circumstances indicate that the carrying value of assets exceeds the recoverable amounts, whether goodwill and intangible assets with indefinite lives have suffered any impairment in accordance with the accounting policy stated in Note 2 to our audited consolidated financial statements included in this annual report.
For performance obligations 100 Table of Contents that are satisfied at a point in time, we also consider the following indicators to assess whether control of a promised good or service is transferred to the customer: (i) right to payment, (ii) legal title, (iii) physical possession, (iv) significant risks and rewards of ownership and (v) acceptance of the good or service.
For performance obligations that are satisfied at a point in time, we also consider the following indicators to assess whether control of a promised good or service is transferred to the customer: (i) right to payment, (ii) legal title, (iii) physical possession, (iv) significant risks and rewards of ownership and (v) acceptance of the good or service.
For long-lived and intangible assets with finite lives, we perform an impairment assessment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. These 103 Table of Contents assessments primarily use future undiscounted net cash flows expected to result from the use of the assets and their eventual disposition.
For long-lived and intangible assets with finite lives, we perform an impairment assessment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. These assessments primarily use future undiscounted net cash flows expected to result from the use of the assets and their eventual disposition.
Loans by us to our PRC subsidiaries to finance their activities cannot exceed statutory limits, See “Item 4. Information on the Company—B. Business Overview—Regulations—Regulations of Foreign Currency Exchange, Foreign Debt and Dividend 99 Table of Contents Distribution” for further details.
Loans by us to our PRC subsidiaries to finance their activities cannot exceed statutory limits, See “Item 4. Information on the Company—B. Business Overview—Regulations—Regulations of Foreign Currency Exchange, Foreign Debt and Dividend Distribution” for further details.
For discussion of 2022 items and year-over-year comparisons between 2023 and 2022 that are not included in this annual report on Form 20-F, please refer to “Item 5. Operating and Financial Review and Prospects” found in our Form 20-F for the year ended December 31, 2023 that was filed with the Securities and Exchange Commission on April 18, 2024. A.
For discussion of 2023 items and year-over-year comparisons between 2024 and 2023 that are not included in this annual report on Form 20-F, please refer to “Item 5. Operating and Financial Review and Prospects” found in our Form 20-F for the year ended December 31, 2024 that was filed with the Securities and Exchange Commission on April 15, 2025. A.
Our subsidiaries incorporated in Hong Kong were subject to Hong Kong profits tax rate of 16.5% for the years ended December 31, 2023 and 2024.
Our subsidiaries incorporated in Hong Kong were subject to Hong Kong profits tax rate of 16.5% for the years ended December 31, 2024 and 2025.
The consideration for sale of robots are normally paid in advance, which means the payments received are prior to the transfer of goods or services by us, we record a contract liability (deferred revenue) for the amount relating to those unperformed obligations.
The consideration for sale of robotic products is normally paid in advance, which means the payments received are prior to the transfer of goods or services by us, we record a contract liability (deferred revenue) for the amount relating to those unperformed obligations.
Recent Accounting Pronouncements A list of recent accounting pronouncements that are relevant to us is included in Note 2 to our consolidated financial statements, which are included in this annual report. 96 Table of Contents B.
Recent Accounting Pronouncements A list of recent accounting pronouncements that are relevant to us is included in Note 2 to our consolidated financial statements, which are included in this annual report. B.
Selling and marketing expenses consist primarily of general marketing and promotion expenses and salaries and benefits, including share-based compensation expenses, related to personnel involved in our selling and marketing efforts. General and Administrative Expenses .
Selling and marketing expenses consist primarily of general marketing and promotion expenses and salaries and benefits, including share-based compensation expenses, related to personnel involved in our selling and marketing efforts. 89 Table of Contents General and Administrative Expenses .
The following table sets forth our contractual obligations by specified categories as of December 31, 2024.
The following table sets forth our contractual obligations by specified categories as of December 31, 2025.
As set out in Note 2 “Lease, as of a Lessor”, robot rental revenue is recognized under ASC 842. 102 Table of Contents Technical, AI application services and others We provide other services including technical support, extended time warranty, maintenance services, AI data and AI solution services etc to customers.
As set out in Note 2 “Lease, as of a Lessor”, rental revenue of robotic products is recognized under ASC 842. Technical, AI application services and others We provide other services including technical support, extended time warranty, maintenance services, AI data and AI solution services etc. to customers.
Our products are mainly utility software which face intensive competition. We must develop innovative products and services, continuously enrich the functionality of our products that meet the disparate needs of users, platform and channel partners and roll them out on a timely basis while controlling our product development expenses.
Our products are mainly utility software and AI-powered applications, which face intensive competition. We must develop innovative products and services, continuously enrich the functionality of our products that meet the disparate needs of users, platform, distribution and co-operation partners, and roll them out on a timely basis while controlling our product development expenses.
Under Japan EIT law, companies incorporated in Japan with paid-in capital in excess of Japanese Yen (“JPY”) 100 million was subject to national corporate income tax rate 23.2% and companies with paid-in capital of no more than JPY100 million was subject 92 Table of Contents to national corporate income tax rate of 15% on the first JPY8 million of income earned and at 23.2% on any income earned in excess of JPY8 million.
Under Japan's corporate tax law, companies incorporated in Japan with paid-in capital in excess of Japanese Yen (“JPY”) 100 million are subject to national corporate income tax rate 23.2% and companies with paid-in capital of no more than JPY100 million are subject to national corporate income tax rate of 15% on the first JPY8 million of income earned and at 23.2% on any income earned in excess of JPY8 million.
We mainly enter into cost for performance and cost per impression advertising agreements with customers. For contracts that are charged on the cost for performance basis, we charge an agreed-upon fee to its customers determined based on the effectiveness of advertising links, which is typically measured by clicks, transactions, installations, user registrations, and other actions.
For contracts that are charged on the cost for performance basis, we charge an agreed-upon fee to its customers determined based on the effectiveness of advertising links, which is typically measured by clicks, transactions, installations, user registrations, and other actions.
Material cash requirements Our material cash requirements as of December 31, 2024 and any subsequent interim period primarily include our capital expenditures, operating lease obligations, and purchase obligations. We incurred capital expenditures of RMB9.7million and RMB22.8 million (US$3.1 million) in 2023 and 2024, respectively.
Material cash requirements Our material cash requirements as of December 31, 2025 and any subsequent interim period primarily include our capital expenditures, operating lease obligations, and purchase obligations. We incurred capital expenditures of RMB22.8 million and RMB12.8 million (US$1.8 million) in 2024 and 2025, respectively.
In other cases, we act as a reseller of cloud resources and during which we act as an agent to arrange for the resources to be provided by third parties and revenue is recognized on a net basis.
In other cases, we act as a reseller of cloud resources and during which we act as an agent to arrange for the resources to be provided by third parties and revenue is recognized on a net basis. Sale and rental of robotic products We generate revenue from sale and rental of robotic products.
Short-term investments consist of highly liquid investments with original maturities of greater than three months but less than 12 months and investments that are expected to be realized in cash during the next 12 months. As of December 31, 2024, we had RMB1,833.0 million (US$251.1 million) in cash and cash equivalents.
Short-term investments consist of highly liquid investments with original maturities of greater than three months but less than 12 months and investments that are expected to be realized in cash during the next 12 months. As of December 31, 2025, we had RMB1,506.6 million (US$215.4 million) in cash and cash equivalents.
Primarily as a result of the foregoing, our net loss attributable to Cheetah Mobile shareholders was RMB617.6 million (US$84.6 million) in 2024, as compared to a net loss attributable to Cheetah Mobile shareholders of RMB602.9 million in 2023.
Primarily as a result of the foregoing, our net loss attributable to Cheetah Mobile shareholders was RMB257.7 million (US$36.9 million) in 2025, as compared to a net loss attributable to Cheetah Mobile shareholders of RMB617.6 million in 2024.
Purchase obligations primarily consist of minimum commitment for purchase of cloud services. We intend to fund our existing and future material cash requirements with our existing cash balance and other financing alternatives. We will continue to make cash commitments, including capital expenditures, to support the growth of our business.
We intend to fund our existing and future material cash requirements with our existing cash balance and other financing alternatives. We will continue to make cash commitments, including capital expenditures, to support the growth of our business.
A large and engaged user base is crucial for the sustainability of our product and related services, our advertising revenue is driven by the size of our user base and our VIP membership revenue depend on our ability to convert more users to paying users.
A large and engaged user base is crucial for the sustainability of our product and related services, our advertising revenue is driven by the size of our user base and our value-added services depend on our ability to convert more users to paying users. Our user base has experienced fluctuations in prior years.
For long-term investment accounted for using fair value option and long-term debt securities, we estimate their fair value on each reporting date. For equity securities accounted for under measurement alternative, we estimated the fair value when there’s an observable price changes for identical or similar investments of the same issuer or when qualitative assessment indicates that the investment is impaired.
For equity securities accounted for under measurement alternative, we estimated the fair value when there’s an observable price changes for identical or similar investments of the same issuer or when qualitative assessment indicates that the investment is impaired.
As of the date of this annual report, our PRC subsidiaries and VIEs are subject to VAT at a rate of 3%, 6%, 9% or 13% VAT rate on the services we provide and related surcharges.
As of the date of this annual report, our PRC subsidiaries and VIEs are subject to VAT at a rate of 3%, 6%, 9% or 13% VAT rate on the products and services we provide and related surcharges. Results of Operations The following table sets forth a summary of our consolidated results of operations for the years indicated.
Our income tax expenses was RMB47.3 million (US$6.5 million) in 2024, as compared to income tax benefits of RMB43.8 million in 2023. Net loss attributable to Cheetah Mobile shareholders.
Our income tax expenses was RMB8.5 million (US$1.2 million) in 2025, as compared to income tax expenses of RMB47.3 million in 2024. Net loss attributable to Cheetah Mobile shareholders.
Under the Arrangement Between the PRC and the Hong Kong Special Administrative Region on the Avoidance of Double Taxation and Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital, the 10% dividend withholding tax rate may be reduced to 5%, if a Hong Kong resident enterprise that receives a dividend is considered a non-PRC tax resident enterprise and holds at least 25% of the equity interests in the PRC enterprise distributing the dividends, subject to approval of the relevant PRC tax authority.
Under the tax arrangement Between the PRC and Hong 90 Table of Contents Kong, the 10% dividend withholding tax rate may be reduced to 5% if the Hong Kong resident enterprise that receives a dividend is considered a non-PRC tax resident enterprise and holds at least 25% of the equity interests in the PRC enterprise distributing the dividends, subject to approval of the relevant PRC tax authority.
Our selling and marketing expenses increased by 41.2% year over year to RMB342.4 million (US$46.9 million) in 2024. This increase was primarily due to increased marketing and promotion expenses related to user acquisition for our internet business, as well as the increased employee costs as the acquisition of controlling stake in Beijing OrionStar. General and administrative expenses .
Our selling and marketing expenses increased by 5.9% year over year to RMB362.7 million (US$51.9 million) in 2025. This increase was primarily due to increased marketing and promotion expenses related to user acquisition for our internet business, as well as the increased employee costs. General and administrative expenses .
Holding Company Structure Cheetah Mobile Inc. is a holding company. We conduct most of our operations through our subsidiaries and the VIEs incorporated in and outside China.
We conduct most of our operations through our subsidiaries and the VIEs incorporated in and outside China.
As a result of the foregoing, we had an operating loss of RMB437.3 million (US$59.9 million) in 2024, as compared to an operating loss of RMB209.8 million in 2023. Operating loss margin . We had an operating loss margin of 54.2% in 2024, as compared to an operating loss margin of 31.3% in 2023. Other income.
As a result of the foregoing, we had an operating loss of RMB179.4 million (US$25.7 million) in 2025, as compared to an operating loss of RMB437.3 million in 2024. Operating loss margin . We had an operating loss margin of 15.6% in 2025, as compared to an operating loss margin of 54.2% in 2024. Other income.
Judgment is required to determine key assumptions adopted in the cashflow projections and changes to key assumptions can significantly affect these cash flow projections and the results of the impairment tests. Recognition of Income Taxes and Deferred Tax Assets/Liabilities We account for income taxes using the liability method.
Judgment is required to determine key assumptions adopted in the cashflow projections and changes to key assumptions can significantly affect these cash flow projections and the results of the impairment tests.
Accordingly, our Hong Kong subsidiaries may not be able to enjoy the 5% withholding tax rate for the dividends they receive from our PRC subsidiaries if they do not satisfy the relevant conditions under tax rules and regulations and obtain the approvals as required. 93 Table of Contents PRC Value-added tax .
Accordingly, our Hong Kong subsidiaries may not be able to enjoy the 5% withholding tax rate if they do not satisfy the relevant conditions under applicable PRC tax regulations. PRC Value-added tax .
Maintaining reasonable operating expenses of robot manufacturing in China is key to our success, and we shall continually strive to find the most efficient and cost-effective means of achieving our goals. • Investment in technology and talents. We believe our success in AI and others business rooted in our robust technological capabilities.
Our ability to control manufacturing cost, attain operating efficiency, while scaling up our business, is critical to ultimately achieving profitability. Maintaining reasonable operating expenses of robotic manufacturing in China is key to our success, and we shall continually strive to find the most efficient and cost-effective means of achieving our goals. • Investment in technology and talents.
Our capital expenditures were primarily attributable to purchase of computers and servers related to research and development activities and expenditures in enhancing our manufacturing capacity for our service robots products.
Our capital expenditures were primarily attributable to purchase of computers and servers related to research and development activities and expenditures in enhancing our manufacturing capacity for our robotic products. As our robotic products and AI business expands, we may incur more capital expenditures for our these businesses in the future.
Our global expansion may expose us to additional challenges such as exchange rate risk, international taxes and tariffs, legal obligations and additional operational costs, etc. • Our ability to control production and material costs of our service robots. Our ability to control manufacturing cost, attain operating efficiency, while scaling up our business, is critical to achieving profitability.
Our global expansion may expose us to 88 Table of Contents additional challenges such as exchange rate risk, international taxes and tariffs, legal obligations and additional operational costs, etc. • Our ability to control production and material costs of our robotic products.
We have historically dedicated significant resources towards research and development. Specifically, we have invested heavily in artificial intelligent development, and talent recruitment, especially engineers and scientists with expertise and experience in machine learning, software algorithms, and robotics operation.
We believe our success in AI and others business is rooted in our robust technological capabilities. We have dedicated significant resources towards research and development. Specifically, we have invested in artificial intelligence, AI agent technologies, and talent recruitment, especially engineers and scientists with expertise and experience in machine learning, software algorithms, and robotics engineering.
Other income was RMB52.1 million (US$7.1 million) in 2024, primarily due to upward fair value change in certain long-term investment. Other expense. Other expense was RMB191.8 million (US$26.3 million) in 2024, which was primarily due to fair value change and impairment of certain long-term investments. Income tax expense.
Other income was RMB36.9 million (US$5.3 million) in 2025, primarily due to gains from disposal and distribution of long-term investments. Other expense. Other expense was RMB145.5 million (US$20.8 million) in 2025, which was primarily due to fair value change and impairment of certain long-term investments. Income tax expense.
Our capacity to sustain good business relationships with existing customers and attract new customers are crucial to our financial performance. In our service robotics business, we collaborate with global distributors to distribute products in target markets. For our cloud services and advertising agency business, we operate as an authorized agency for global partners, such as Meta and Amazon.
In our robotics business, we primarily distribute products through global distributors and resellers in target markets. For our cloud services and advertising agency business, we operate as an authorized agency for global partners, such as Meta and Amazon.
(602,898) (617,557) (84,604) (1) Share-based compensation expenses were allocated in cost of revenues and operating expenses as follows: Year Ended December 31, 2023 2024 RMB RMB US$ (in thousands) Cost of revenues 370 81 11 Research and development 580 1,924 264 Selling and marketing 509 (662) (91) General and administrative 32,095 24,758 3,392 Total 33,554 26,101 3,576 Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 Revenues .
(617,557) (257,713) (36,851) (1) Share-based compensation expenses were allocated in cost of revenues and operating expenses as follows: Year Ended December 31, 2024 2025 RMB RMB US$ (in thousands) Cost of revenues 81 16 2 Research and development 1,924 1,193 171 Selling and marketing (662) 773 111 General and administrative 24,758 17,858 2,554 Total 26,101 19,840 2,838 91 Table of Contents Year Ended December 31, 2025 Compared to Year Ended December 31, 2024 Revenues .
The following table sets forth the components of our operating income and expenses for the periods indicated.
Operating Income and Expenses Our operating income and expenses consist of (i) research and development expenses, (ii) selling and marketing expenses, (iii) general and administrative expenses, and (iv) other operating income and expenses. The following table sets forth the components of our operating income and expenses for the periods indicated.
During which, estimates used for “Allowance for credit losses”, “Fair value measurements of Non-Marketable long-term investments”, “Fair Value Determination Related to the Accounting for Business Combinations” and “Impairment Assessment on Goodwill, Long-lived Assets and Intangible assets”, “valuation allowance for deferred tax assets”, require management to make difficult, subjective and complex judgments that often as a result of the need to make estimate on matters that are inherently uncertain and which is likely that materially different amounts would be reported under different conditions or assumptions.
During which, estimates used for “Allowance for credit losses”, “Fair value measurements of Non-Marketable long-term investments”, “Fair Value Determination Related to the Accounting for Business Combinations” and “Impairment Assessment on Goodwill, Long-lived Assets and Intangible assets”, “Reassessment of estimated useful life of intangible assets”, “valuation allowance for deferred tax assets”, require management to make difficult, subjective and complex judgments that often as a result of the need to make estimate on matters that are inherently uncertain and which is likely that materially different amounts would be reported under different conditions or assumptions. 96 Table of Contents Consolidation of VIEs PRC law currently restricts foreign ownership of internet-based and mobile-based businesses and regulates internet access, distribution of internet information services and value-added telecommunication services through strict business licensing requirements and other government regulations, unless otherwise permitted under applicable pilot measures in designated regions, where foreign ownership percentage may be allowed to reach up to 100% upon approval by the relevant authorities.
Our value-added services revenue comes from the sale of membership packages and subscriptions, which grant customers ad-free use and exclusive access to premium features including file and data recovery, malicious pop-up interception, PDF conversion, automatic dynamic wallpaper rotation etc. 101 Table of Contents While providing online software services, the customers do not take possession of the software.
Our value-added services revenue earned from the sale of membership packages and subscriptions, which grant customers ad-free use and exclusive access to premium features including file and data recovery, malicious pop-up interception, PDF conversion, automatic dynamic wallpaper rotation etc. These services are delivered directly to end users or distributed through external distributors, such as mobile application stores, and co-operation partners.
As our service robots and AI business expands, we may incur more capital expenditures for our these businesses in the future. 98 Table of Contents Our operating lease obligations consist of the commitments under the lease agreements for our office premises, which include all future cash outflows under ASC Topic 842, Leases under Note 11 to our audited consolidated financial statements.
Our operating lease obligations consist of the commitments under the lease agreements for our office premises, which include all future cash outflows under ASC Topic 842, Leases under Note 11 to our audited consolidated financial statements. Purchase obligations primarily consist of minimum commitment for purchase of cloud services.
The fee arrangements with these significant customers and the mix of these arrangements can have a significant impact on our revenues, and some of these impact may be beyond our control. AI and Others Revenue from AI and others accounted for 32.8% and 35.9% of our revenues in 2023 and 2024, respectively.
Changes in the terms or revenue-sharing ratios of these arrangements could have a significant impact on our revenues from value-added services. The fee arrangements with these customers and partners, and the mix of these arrangements, can have a significant impact on our revenues, and some of these impact may be beyond our control.
Under relevant PRC government policies, enterprises qualified as “new software enterprise” are entitled to a two-year exemption and three-year 50% reduction on enterprise income tax commencing from the first profit-making year. Enterprises qualified as “high and new technology enterprise” are entitled to a preferential rate of 15%.
Under relevant PRC government policies, enterprises qualified as “high and new technology enterprise” are entitled to a preferential rate of 15%.
We provide standard warranty on all robots sold, which is not a separate performance obligation as it is intended to provide greater quality assurance to customers. Accordingly, standard warranty is accounted for in accordance with ASC 460, Guarantees, and the estimated costs are recorded as a liability when the Group transfers the control of robots to a customer.
Accordingly, standard warranty is accounted for in accordance with ASC 460, Guarantees, and the estimated costs are recorded as a liability when we transfer the control of robotic products 98 Table of Contents to a customer.
The table below sets forth a breakdown of our cash by currency and location as of December 31, 2023 and 2024: As of December 31, 2023 2024 (in thousands of RMB) Cash located outside of the PRC —held by Company and Subsidiaries in US dollars 1,371,328 1,139,320 —held by Company and Subsidiaries in RMB 13,104 858 —held by Company and Subsidiaries in others 62,539 71,632 —held by VIEs in US dollars 16,744 43,416 —held by VIEs in RMB — 107 —held by VIEs in others 1,438 1,098 Cash located in the PRC —held by Company and Subsidiaries in RMB 271,966 242,673 —held by Company and Subsidiaries in US dollars 125,109 105,091 —held by Company and Subsidiaries in others 2,637 1,440 —held by VIEs in RMB 155,318 227,388 —held by VIEs in US dollars 8 8 Total cash and cash equivalents 2,020,191 1,833,031 The table below sets forth a breakdown of our short-term investments by location as of December 31, 2023 and 2024: As of December 31, 2023 2024 (RMB in thousands) Short-term investments located outside of the PRC —Time deposits located outside the PRC 1,023 318 Short-term investments located in the PRC —Wealth management products located in the PRC — 17 Total short-term investments 1,023 335 97 Table of Contents The following table sets forth a summary of our cash flows for the years indicated: Year Ended December 31, 2023 2024 RMB RMB US$ (in thousands) Net cash provided by/(used in) operating activities 550,462 (238,323) (32,649) Net cash used in investing activities (49,061) (34,090) (4,670) Net cash (used in)/provided by financing activities (6,778) 69,113 9,469 Effect of exchange rate changes on cash, cash equivalents and restricted cash 9,073 16,140 2,209 Cash, cash equivalents and restricted cash at the beginning of year 1,516,495 2,020,191 276,765 Net increase (decrease) in cash, cash equivalents and restricted cash 503,696 (187,160) (25,641) Cash, cash equivalents and restricted cash at the end of year 2,020,191 1,833,031 251,124 Operating Activities Net cash used in operating activities for the year ended December 31, 2024 was RMB238.3 million (US$32.6 million).
If the foreign exchange control system prevents us from obtaining sufficient foreign currencies to satisfy our foreign currency demands, we may not be able to pay dividends to our shareholders. 93 Table of Contents The table below sets forth a breakdown of our cash by currency and location as of December 31, 2024 and 2025: As of December 31, 2024 2025 (in thousands of RMB) Cash located outside of the PRC —held by Company and Subsidiaries in US dollars 1,139,320 718,837 —held by Company and Subsidiaries in RMB 858 25,957 —held by Company and Subsidiaries in others 71,632 95,709 —held by VIEs in US dollars 43,416 35,759 —held by VIEs in RMB 107 127 —held by VIEs in others 1,098 10,167 Cash located in the PRC —held by Company and Subsidiaries in RMB 242,673 368,552 —held by Company and Subsidiaries in US dollars 105,091 66,624 —held by Company and Subsidiaries in others 1,440 1,106 —held by VIEs in RMB 227,388 183,779 —held by VIEs in US dollars 8 8 Total cash and cash equivalents 1,833,031 1,506,625 The table below sets forth a breakdown of our short-term investments by location as of December 31, 2024 and 2025: As of December 31, 2024 2025 (RMB in thousands) Short-term investments located outside of the PRC —Time deposits located outside the PRC 318 526 Short-term investments located in the PRC —Wealth management products located in the PRC 17 9,001 Total short-term investments 335 9,527 The following table sets forth a summary of our cash flows for the years indicated: Year Ended December 31, 2024 2025 RMB RMB US$ (in thousands) Net cash used in operating activities (238,323) (172,256) (24,631) Net cash used in investing activities (34,090) (65,567) (9,377) Net cash provided by/ (used in) financing activities 69,113 (64,221) (9,183) Effect of exchange rate changes on cash, cash equivalents and restricted cash 16,140 (24,362) (3,484) Cash, cash equivalents and restricted cash at the beginning of year 2,020,191 1,833,031 262,120 Net decrease in cash, cash equivalents and restricted cash (187,160) (326,406) (46,675) Cash, cash equivalents and restricted cash at the end of year 1,833,031 1,506,625 215,445 Operating Activities Net cash used in operating activities for the year ended December 31, 2025 was RMB172.3 million (US$24.6 million).
Years Ended December 31, 2023 2024 (in thousands, except percentages) RMB % of revenues RMB US$ % of revenues Operating income and expenses Research and development (178,207) (26.6) (243,391) (33,344) (30.2) Selling and marketing (242,511) (36.2) (342,421) (46,911) (42.4) General and administrative (229,549) (34.3) (244,385) (33,481) (30.3) Impairment of goodwill — — (152,890) (20,946) (18.9) Other operating income, net 2,867 0.4 637 87 0.1 Total operating income and expenses (647,400) (96.7) (982,450) (134,595) (121.7) Research and Development Expenses .
Years Ended December 31, 2024 2025 (in thousands, except percentages) RMB % of revenues RMB US$ % of revenues Operating income and expenses Research and development (243,391) (30.2) (346,152) (49,499) (30.1) Selling and marketing (342,421) (42.4) (362,735) (51,870) (31.5) General and administrative (244,385) (30.3) (266,522) (38,112) (23.2) Impairment of goodwill and intangible assets (152,890) (18.9) (41,563) (5,943) (3.6) Other operating income, net 637 0.1 3,496 500 0.3 Total operating income and expenses (982,450) (121.7) (1,013,476) (144,924) (88.1) Research and Development Expenses .
Our ability to ultimately achieve profitability is dependent on the progression of robot distributors’ market demand, changes of our partners’ policies, including rebate structures and policy compliance and our ability to meet required volumes and required cost targets. • Our ability to expand in domestic and international markets.
Our ability to ultimately achieve profitability is dependent on a number of factors, including market demand and pricing dynamics for our robotics products, the rebate structures and policies of our advertising and cloud platform partners, and our ability to control costs while meeting required volume targets. • Our ability to expand in domestic and international markets.
Revenue is recognized at a point in time when there is an effective click, transaction, installations, user registrations, and other actions. For advertising contracts that charged on cost per impression basis, we recognize the revenue at a point in time when the impressions are delivered based on the mutual agreement formed with customers.
Revenue is recognized at a point in time when there is an effective click, transaction, installations, user registrations, and other actions.
Based on the Circular of the SAT on Relevant Issues concerning the Implementation of Dividend Clauses in Tax Treaties issued on February 20, 2009, if the relevant PRC tax authorities determine, in their discretion, that a company benefits from such reduced income tax rate due to a structure or arrangement that is primarily tax-driven, such PRC tax authorities may adjust the preferential tax treatment.
The PRC tax authorities have discretion to adjust the preferential tax treatment if a company benefits from such reduced rate due to a structure or arrangement that is primarily tax-driven, and the determination of beneficial owner status is subject to review based on factors including the applicant's business substance and income distribution patterns.
Payment due by period Total Less than 1 Year 1-3 Years 3-5 Years More Than 5 Years (In thousands of RMB) Operating lease obligations 26,994 14,697 10,679 1,618 — Purchase obligations 138,067 72,028 66,039 — — Total 165,061 86,725 76,718 1,618 — Other than as discussed above, we did not have any significant capital and other commitments, long-term obligations or guarantees as of December 31, 2024.
Payment due by period Total Less than 1 Year 1-3 Years 3-5 Years More Than 5 Years (In thousands of RMB) Operating lease obligations 15,870 10,592 5,144 134 — Purchase obligations 222,751 180,443 42,308 — — Total 238,621 191,035 47,452 134 — Other than as discussed above, we did not have any significant capital and other commitments, long-term obligations or guarantees as of December 31, 2025. 95 Table of Contents Holding Company Structure Cheetah Mobile Inc. is a holding company.
Research and development expenses . Our research and development expenses increased by 36.6% year over year to RMB243.4 million (US$33.3 million) in 2024. The increase was primarily due to the increased employee costs and intangible assets amortization expenses as the acquisition of controlling stake in Beijing OrionStar. Selling and marketing expenses .
Research and development expenses . Our research and development expenses increased by 42.2% year over year to RMB346.2 million (US$49.5 million) in 2025. The increase was primarily due to higher amortization expenses related to intangible assets from business combinations. Selling and marketing expenses .
Operating Results—Taxation—Taxation in Different Jurisdictions—PRC—Enterprise income tax.” 94 Table of Contents Results of Operations The following table sets forth a summary of our consolidated results of operations for the years indicated. The year-to-year comparisons of results of operations should not be relied upon as indicative of our future performance.
The year-to-year comparisons of results of operations should not be relied upon as indicative of our future performance.
Operating Results Overview We are a China-based IT company with a commitment to AI innovation. We generate revenues primarily by providing utility-related business, including advertising services and premium membership services worldwide. We also provide multi-cloud management and overseas advertising agency service.
Operating Results Overview We are a China-based IT company with a commitment to AI innovation, providing diversified products and services spanning internet, robotics and enterprise services across global markets. Revenues We generate revenues from internet business and AI and others.
The following table presents our revenues disaggregated by revenue source: Year Ended December 31, 2023 2024 RMB RMB US$ (in thousands) Revenues: Internet business Online advertising 109,339 184,655 25,298 Internet value-added services 340,795 332,533 45,556 AI and Others Advertising agency services 89,275 78,036 10,691 Multi-cloud Management Services 87,747 87,242 11,952 Sale and rental of robots and other AI hardware products 22,034 111,577 15,286 Technical, AI application services and others 20,313 12,834 1,758 Total consolidated revenues 669,503 806,877 110,541 Internet business Online advertising Online advertising revenue is primarily derived from displaying advertisements for our customers on its online platforms including duba.com and other websites, browsers, PC and mobile applications.
The following table presents our revenues disaggregated by revenue source: Year Ended December 31, 2024 2025 RMB RMB US$ (in thousands) Revenues: Internet business Online advertising 184,655 212,474 30,383 Internet value-added services 332,533 402,807 57,601 AI and Others Advertising agency services 78,036 238,985 34,174 Multi-cloud Management Services 87,242 136,331 19,495 Sale and rental of robotic products 111,577 145,866 20,859 Technical, AI application services and others 12,834 13,981 1,999 Total consolidated revenues 806,877 1,150,444 164,511 Internet business .
Our VIP membership and software subscription services are mainly sold in short term period, typically, no more than 12 months. We believe that the most significant company-specific factors affecting the operation of our internet business include: • User base and user engagement in key markets .
We generate advertising revenues by displaying advertisements on our software products. We also generate value-added services revenues from subscription and other value-added services, both directly to users and through distribution and co-operation partners. We believe that the most significant company-specific factors affecting the operation of our internet business include: • User base and user engagement in key markets .
Year Ended December 31, 2023 2024 RMB RMB US$ (in thousands) Selected Consolidated Statements of Comprehensive loss: Revenues 669,503 806,877 110,541 Internet business 450,134 517,188 70,854 AI and others 219,369 289,689 39,687 Cost of revenues (1) (231,940) (261,682) (35,850) Gross profit 437,563 545,195 74,691 Operating income and expenses Research and development (1) (178,207) (243,391) (33,344) Selling and marketing (1) (242,511) (342,421) (46,911) General and administrative (1) (229,549) (244,385) (33,481) Impairment of goodwill — (152,890) (20,946) Other operating income, net 2,867 637 87 Total operating expenses, net (647,400) (982,450) (134,595) Operating loss (209,837) (437,255) (59,904) Other income (expenses) Interest income, net 60,978 44,422 6,086 Foreign exchange losses, net (11,421) (21,726) (2,976) Other income 96,765 52,059 7,132 Other expense (574,135) (191,828) (26,280) Loss before income taxes (637,650) (554,328) (75,942) Income tax benefits 43,781 (47,258) (6,474) Net loss (593,869) (601,586) (82,416) Less: net income attributable to noncontrolling interests 9,029 15,971 2,188 Net loss attributable to Cheetah Mobile Inc.
Year Ended December 31, 2024 2025 RMB RMB US$ (in thousands) Selected Consolidated Statements of Comprehensive loss: Revenues 806,877 1,150,444 164,511 Internet business 517,188 615,281 87,984 AI and others 289,689 535,163 76,527 Cost of revenues (1) (261,682) (316,411) (45,246) Gross profit 545,195 834,033 119,265 Operating income and expenses Research and development (1) (243,391) (346,152) (49,499) Selling and marketing (1) (342,421) (362,735) (51,870) General and administrative (1) (244,385) (266,522) (38,112) Impairment of goodwill and intangible assets (152,890) (41,563) (5,943) Other operating income, net 637 3,496 500 Total operating expenses, net (982,450) (1,013,476) (144,924) Operating loss (437,255) (179,443) (25,659) Other income (expenses) Interest income, net 44,422 30,629 4,380 Foreign exchange (losses)/gains (21,726) 30,783 4,402 Other income 52,059 36,896 5,276 Other expense (191,828) (145,548) (20,813) Loss before income taxes (554,328) (226,683) (32,414) Income tax expenses (47,258) (8,469) (1,211) Net loss (601,586) (235,152) (33,625) Less: net income attributable to noncontrolling interests 15,971 22,561 3,226 Net loss attributable to Cheetah Mobile Inc.
Revenues from our AI and other business mainly from multi-cloud management platform, overseas advertising agency service and sale and rental of service robots and some other AI related business. 89 Table of Contents On the corporate level, our revenues increased from RMB669.5 million to RMB806.9 million (US$110.5 million) in 2024.
AI and Others Revenue from AI and others accounted for 35.9% and 46.5% of our revenues in 2024 and 2025, respectively. AI and others revenues mainly comprise overseas advertising agency service, multi-cloud management service, sale and rental of our robotic products, as well as other AI-related services.
Years Ended December 31, 2023 2024 RMB % of revenues RMB US$ % of revenues Internet business 450,134 67.2 517,188 70,854 64.1 AI and others 219,369 32.8 289,689 39,687 35.9 Revenues 669,503 100.0 806,877 110,541 100.0 Internet business Revenues from internet business accounted for 67.2% and 64.1% of our revenues in 2023 and 2024, respectively.
The following table sets forth the principal components of our revenues by amount and as a percentage of our revenues for the periods presented. 87 Table of Contents Years Ended December 31, 2024 2025 RMB % of revenues RMB US$ % of revenues Internet business 517,188 64.1 615,281 87,984 53.5 AI and others 289,689 35.9 535,163 76,527 46.5 Revenues 806,877 100.0 1,150,444 164,511 100.0 Internet business Revenues from internet business accounted for 64.1% and 53.5% of our revenues in 2024 and 2025, respectively.
AI and others revenues mainly include revenues from our AI related business, such as business of multi-cloud management service, overseas advertising agency service, sale and rental of our service robots, as well as providing technical, AI application services to third parties and related parties. 90 Table of Contents We believe that the most significant company-specific factors affecting the operation of our AI and others business include: • Our ability to increase sales volume and maintain relationships with customers.
We believe that the most significant company-specific factors affecting the operation of our AI and others business include: • Our ability to increase sales volume and maintain relationships with customers, distributors and platform partners. Our capacity to sustain good business relationships with existing stakeholders and attract new ones are crucial to our financial performance.
We have experienced user-base decrease since 2019 and although we continuously develop more innovative products and enhance our products' user experiences, our user base may continue to decrease in the future. We plan to continue to enhance users’ experience of our products and introduce more products to increase users’ engagement with our products. • Products and Services Innovation.
While we have observed certain growth in recent periods, our user base may fluctuate or decline in the future due to factors such as increased competition and changes in consumer preferences. We plan to continue to enhance users’ experience, including through AI-powered features, and introduce more products to increase user engagement. • Products and Services Innovation.
This amount was primarily attributable to net loss of RMB601.6 million (US$82.4 million), (i) adjusted to add back impairment of goodwill of RMB152.9 million (US$20.9 million); (ii) adjusted to add back impairment of assets of RMB120.6 million (US$16.5 million); (iii) adjusted for changes in operating assets and liabilities that positively affected operating cash flow, primarily an increase in accrued expenses and other current liabilities RMB287.7 million (US$39.4 million), (iv) partially offset by changes in operating assets and liabilities that negatively affected operating cash flow, primarily due to an increase in prepayments and other current assets RMB388.8 million (US$53.3 million).
This amount was primarily attributable to net loss of RMB235.2 million (US$33.6 million), (i) adjusted to add back amortization of intangible assets of RMB135.8 million (US$19.4 million); (ii) adjusted to add back impairment of assets of RMB121.0 million (US$17.3 million); (iii) adjusted to add back provision for credit losses of RMB70.2 million (US$10.0 million); (iv) adjusted for changes in operating assets and liabilities that negatively affected operating cash flow, primarily due to decrease in accrued expenses and other current liabilities RMB439.1 million (US$62.8 million), (v) offset by changes in operating assets and liabilities that positively affected operating cash flow, primarily a decrease in prepayments and other current assets RMB182.8 million (US$26.1 million). 94 Table of Contents Investing Activities Net cash used in investing activities was RMB65.6 million (US$9.4 million) for the year ended December 31, 2025, primarily attributable to net cash paid for purchase of short-term investments of RMB949.5 million (US$135.8 million), purchase of long-term investments of RMB44.9 million (US$6.4 million), purchase of subsidiaries, net of cash acquired of RMB31.4 million (US$4.5 million), and purchase of property, plant and equipment and intangible assets of RMB12.8 million (US$1.8 million), partially offset by proceeds from maturity of short-term investments of RMB940.1 million (US$134.4 million) and proceeds from disposals of and distributions received from long-term investments of RMB31.2 million (US$4.5 million).
We plan to continue to make investment in our products improvement and development. • Fee arrangements with our significant customers. A small number of advertising customers have contributed a significant portion of revenues for our online advertising services.
We plan to continue to make investment in our products improvement and development, including leveraging AI agent technologies to enhance existing products and develop new offerings. • Fee arrangements with our significant customers and partners. Our revenues from internet business are affected by fee arrangements with our advertising customers and distribution and co-operation partners.
In advertising markets, advertising platforms provide bids to APP operators for displaying advertisements on their apps, and the bid prices may fluctuate significantly depending on who are the bidders, the type of the advertising inventories, seasonality, and supply and demand balance.
In our advertising markets, the bid prices may fluctuate significantly depending on the type of the advertising inventories, seasonality, and supply and demand balance. In our value-added services business, we distribute certain of our services through distribution and co-operation partners under revenue-sharing arrangements.
Our cost of revenues increased by 12.8% from RMB231.9 million in 2023 to RMB261.7 million (US$35.9 million) in 2024. This increase was in line with increase of our revenue. Gross profit . As a result of the foregoing, our gross profit increased by 24.6% from RMB437.6 million in 2023 to RMB545.2 million (US$74.7 million) in 2024. Gross margin .
As a result of the foregoing, our gross profit increased by 53.0% from RMB545.2 million in 2024 to RMB834.0 million (US$119.3 million) in 2025. Operating expenses . Our operating expenses increased by 3.2% from RMB982.5 million in 2024 to RMB1,013.5 million (US$144.9 million) in 2025.
Investing Activities Net cash used in investing activities was RMB34.1 million (US$4.7 million) for the year ended December 31, 2024, primarily attributable to net cash paid for purchase of short-term investments of RMB1,084.7 million (US$148.6 million) and purchase for long-term investments of RMB37.0 million(US$5.1 million), partially offset by proceeds from maturity of short-term investments of RMB1,085.4 million(US$148.7 million).
Financing Activities Net cash used in financing activities was RMB64.2 million (US$9.2 million) for the year ended December 31, 2025, primarily attributable to repayment of loan to a related party of RMB44.7 million (US$6.4 million) and repurchase of noncontrolling interests of RMB20.8 million (US$3.0 million).
Because expected credit losses can vary substantially over time, estimating expected credit losses requires a number of assumptions about matters that are uncertain. Fair value measurements of Non-Marketable long-term investments We measure certain long-term investments at fair value on a recurring or non-recurring basis.
Fair value measurements of Non-Marketable long-term investments We measure certain long-term investments at fair value on a recurring or non-recurring basis. For long-term investment accounted for using fair value option and long-term debt securities, we estimate their fair value on each reporting date.
Cost of robots and other products sold include direct materials, external processing fee, depreciation and amortization of assets associated with the production. 91 Table of Contents Operating Income and Expenses Our operating income and expenses consist of (i) research and development expenses, (ii) selling and marketing expenses, (iii) general and administrative expenses, and (iv) other operating income and expenses.
Channel and sharing costs primarily consist of fees paid to payment channels and revenue sharing costs paid to distribution and co-operation partners. Cost of robotic products sold include direct materials, external processing fee, depreciation and amortization of assets associated with the production.
Cost of Revenues Cost of revenues primarily consist of traffic acquisition costs, bandwidth and cloud service costs, personnel costs, channel and sharing costs, depreciation of equipment, and cost of robots and other products sold. Traffic acquisition costs represent the amounts paid or payable to third-party advertising publishers who distribute our customers’ paid links through their advertisement products.
We also leverage third-party AI models and open-source frameworks to accelerate product development and improve R&D efficiency. Cost of Revenues Cost of revenues primarily consist of bandwidth and cloud service costs, personnel costs, channel and sharing costs, depreciation of equipment, and cost of robotic products sold.
Our operating expenses increased by 51.8% from RMB647.4 million in 2023 to RMB982.5 million (US$134.6 million) in 2024 mainly due to impairment of goodwill, our increased marketing and promotion expenses on user acquisition for our internet business, as well as the increase of employee costs and amortization expenses of the intangible assets as the acquisition of controlling stake in Beijing OrionStar.
The increase was primarily due to higher amortization expenses related to intangible assets from business combinations, a one-off increase in expected credit losses, and increased marketing and promotion expenses for user acquisition. The increase was partially offset by decrease in impairment charges, as no goodwill impairment was recognized in 2025 compared to RMB152.9 million in 2024.
Removed
Multi-cloud management service is to provide our customers one-stop multi-cloud resource management solutions, conduct comprehensive management of multi-cloud resources and environment, and provide various solutions that can be implemented in the cloud, including platforms for backup and disaster recovery, machine learning, cost optimization and monitoring alarm.
Added
Our revenues increased by 42.6% from RMB806.9 million in 2024 to RMB1,150.4 million (US$164.5 million) in 2025.
Removed
Overseas advertising agency service is to assist companies to launch advertisement on large overseas advertising platforms, such as Meta. Subsequent to the acquisition of Beijing OrionStar in November 2023, we enlarged our business to provide service robots globally to restaurants, exhibitions, logistic centers and so on.
Added
Revenues from internet business increased by 19.0% from RMB517.2 million in 2024 to RMB615.3 million (US$88.0 million) in 2025.
Removed
Through a full range of AI technologies, our service robots can be customized and are able to provide comprehensive solutions to optimize efficiency, improve sales, ensure service standardization and enhance customer satisfaction.

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Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

23 edited+2 added−23 removed46 unchanged
The maximum aggregate number of shares which may be issued pursuant to all awards under the 2023 Plan is 145,000,000 ordinary shares. As of March 31, 2025, 101,559,650 restricted shares (excluding those that have been forfeited) had been granted under the 2023 Plan. The following is a summary of the key terms of the 2023 Plan. Types of Awards .
The maximum aggregate number of shares which may be issued pursuant to all awards under the 2023 Plan is 145,000,000 ordinary shares. As of March 31, 2026, 101,559,650 restricted shares (excluding those that have been forfeited) had been granted under the 2023 Plan. The following is a summary of the key terms of the 2023 Plan. Types of Awards .
Each officer also agrees that we shall own all the intellectual property developed by such officer during his or her employment. C. Board Practices Board of Directors Our board of directors currently consists of six directors. A director is not required to hold any shares in our company to qualify to serve as a director.
Each officer also agrees that we shall own all the intellectual property developed by such officer during his or her employment. C. Board Practices Board of Directors Our board of directors currently consists of seven directors. A director is not required to hold any shares in our company to qualify to serve as a director.
The compensation committee is responsible for, among other things: • reviewing and approving, or recommending to the board for its approval, the compensation for our chief executive officer and other executive officers; • reviewing and recommending to the board for determination with respect to the compensation of our non-employee directors; • reviewing periodically and approving any incentive compensation or equity plans, programs or similar arrangements; and • selecting compensation consultant, legal counsel or other adviser only after taking into consideration all factors relevant to that person’s independence from management.
The compensation committee is responsible for, among other things: 104 Table of Contents • reviewing and approving, or recommending to the board for its approval, the compensation for our chief executive officer and other executive officers; • reviewing and recommending to the board for determination with respect to the compensation of our non-employee directors; • reviewing periodically and approving any incentive compensation or equity plans, programs or similar arrangements; and • selecting compensation consultant, legal counsel or other adviser only after taking into consideration all factors relevant to that person’s independence from management.
For the fiscal year ended December 31, 2024, we contributed an aggregate of approximately RMB0.7 million (US$0.1 million) for pension, retirement benefits or other similar benefits for our executive officers and directors.
For the fiscal year ended December 31, 2025, we contributed an aggregate of approximately RMB0.7 million (US$0.1 million) for pension, retirement benefits or other similar benefits for our executive officers and directors.
Subject to the 108 Table of Contents rules of NYSE and disqualification by the chairman of the relevant board meeting, a director may vote in respect of any contract or transaction or proposed contract or transaction notwithstanding that he may be interested therein and if he does so his vote shall be counted and he may be counted in the quorum at any meeting of our directors at which any such contract or transaction or proposed contract or transaction is considered.
Subject to the rules of NYSE and disqualification by the chairman of the relevant board meeting, a director may vote in respect of any contract or transaction or proposed contract or transaction notwithstanding that he may be interested therein and if he does so his vote shall be counted and he may be counted in the quorum at any meeting of our directors at which any such contract or transaction or proposed contract or transaction is considered.
Our PRC entities are required by law to make contributions equal to certain percentages of each employee’s salary for his or her retirement benefit, medical insurance benefits, housing funds, unemployment and other statutory benefits.
Our PRC entities are required by law to make contributions equal to certain percentages 101 Table of Contents of each employee’s salary for his or her retirement benefit, medical insurance benefits, housing funds, unemployment and other statutory benefits.
Nominating and Corporate Governance Committee Our nominating and corporate governance committee consists of Wu Shengwu, and Dr. Yi Ma and is chaired by Dr. Yi Ma. Our board of directors has determined that Wu Shengwu and Dr. Yi Ma both satisfy the “independence” standards under applicable NYSE 109 Table of Contents corporate governance rules.
Nominating and Corporate Governance Committee Our nominating and corporate governance committee consists of Wu Shengwu, and Dr. Yi Ma and is chaired by Dr. Yi Ma. Our board of directors has determined that Wu Shengwu and Dr. Yi Ma both satisfy the “independence” standards under applicable NYSE corporate governance rules.
The plan administrator has the sole discretion to determine the participants to receive the awards, the number and types of awards to be granted to each participant, and the terms and conditions of each award grant. 107 Table of Contents Award Agreement .
The plan administrator has the sole discretion to determine the participants to receive the awards, the number and types of awards to be granted to each participant, and the terms and conditions of each award grant. Award Agreement .
Fu was the vice president of Matrix Partners China from November 2008. Between November 2005 and August 2008, Mr. Fu worked at Qihoo 360 serving various management roles at its 360 department, a division then in charge of developing 360 products. From March 2003 to October 2005, Mr.
Prior to that, Mr. 100 Table of Contents Fu was the vice president of Matrix Partners China from November 2008. Between November 2005 and August 2008, Mr. Fu worked at Qihoo 360 serving various management roles at its 360 department, a division then in charge of developing 360 products. From March 2003 to October 2005, Mr.
All restricted shares granted prior to the completion of our initial public offering under our share incentive plans entitle the holders to our Class B ordinary shares, while all restricted shares granted thereafter entitle the holders to Class A ordinary shares. 4. The 2023 Plan We adopted the 2023 Plan in April 2023.
All restricted shares granted prior to the completion of our initial public offering under our share incentive plans entitle the holders to our Class B ordinary shares, while all restricted shares granted thereafter entitle the holders to Class A ordinary shares. 102 Table of Contents 2. The 2023 Plan We adopted the 2023 Plan in April 2023.
Compensation Compensation of Directors and Officers For the fiscal year ended December 31, 2024, we paid an aggregate of approximately RMB18.2 million (US$2.5 million) in cash to our executive officers and directors (excluding independent directors), and an aggregate of approximately RMB1.5 million (US$0.2 million) in cash to our independent directors.
Compensation Compensation of Directors and Officers For the fiscal year ended December 31, 2025, we paid an aggregate of approximately RMB19.2 million (US$2.8 million) in cash to our executive officers and directors (excluding independent directors), and an aggregate of approximately RMB1.5 million (US$0.2 million) in cash to our independent directors.
Directors and Executive Officers Age Position/Title Sheng Fu 47 Chief Executive Officer and Chairman of the Board of Directors Thomas Jintao Ren 46 Chief Financial Officer and Director Edward Mingyan Sun 42 Director Bo Peng 46 Director Wu Shengwu 51 Independent Director Dr. Yi Ma 52 Independent Director Dr.
Directors and Executive Officers Age Position/Title Sheng Fu 48 Chief Executive Officer and Chairman of the Board of Directors Thomas Jintao Ren 47 Chief Financial Officer and Director Edward Mingyan Sun 43 Director Bo Peng 47 Director Wu Shengwu 52 Independent Director Dr. Yi Ma 53 Independent Director Dr.
Yun Zhang 48 Independent Director Sheng Fu has been our Chairman of the Board since March 2018, and our chief executive officer and director of the Board since November 2010. Since September 2009, Mr. Fu has been the chief executive officer and chairman of Conew Network. Prior to that, Mr.
Yun Zhang 49 Independent Director Sheng Fu has been our Chairman of the Board since March 2018, and our chief executive officer and director of the Board since November 2010. Since September 2009, Mr. Fu has been the chief executive officer and chairman of Conew Network.
The purpose of our share incentive plans is to recruit and retain key employees, directors or consultants of outstanding ability and to motivate them to deliver the best performance for the benefit of our company. 1.
The purpose of our share incentive plans is to recruit and retain key employees, directors or consultants of outstanding ability and to motivate them to deliver the best performance for the benefit of our company. 1. The 2014 Plan We adopted the 2014 Plan in April 2014.
Prior to joining Rongxin Semiconductor, he held the position of Global Executive Vice President at Tsinghua Unigroup and Chairman of the Board at Xiamen Xueda Education Technology Group Co., Ltd. (SZSE: 000526). Mr.
Wu Shengwu has served as the Chairman of Rongxin Semiconductor Technology Co., Ltd. since 2024. Prior to joining Rongxin Semiconductor, he held the position of Global Executive Vice President at Tsinghua Unigroup and Chairman of the Board at Xiamen Xueda Education Technology Group Co., Ltd. (SZSE: 000526). Mr.
In connection with the employment agreement, each senior executive officer has agreed to hold all proprietary or confidential information of our company and our affiliates or the respective clients, customers or partners, including, without limitation, all software and computer formulae, designs, specifications, drawings, data, manuals and instructions and all customer and supplier lists, sales and financial information, business plans and forecasts, all technical solutions and the trade secrets of our company, in strict confidence perpetually.
A senior executive officer may terminate his or her employment at any time by giving one month’s prior written notice. 103 Table of Contents In connection with the employment agreement, each senior executive officer has agreed to hold all proprietary or confidential information of our company and our affiliates or the respective clients, customers or partners, including, without limitation, all software and computer formulae, designs, specifications, drawings, data, manuals and instructions and all customer and supplier lists, sales and financial information, business plans and forecasts, all technical solutions and the trade secrets of our company, in strict confidence perpetually.
Number of Restricted Shares Outstanding Purchase Price (US$/Share) Date of Grant Sheng Fu 42,831,800 N/A June 22, 2023 Edward Mingyan Sun * N/A June 22, 2023 Thomas Jintao Ren * N/A June 22, 2023 Wu Shengwu * N/A September 22, 2023 Yi Ma * N/A June 22, 2023 Yun Zhang * N/A June 22, 2023 All directors and executive officers as a group 57,693,400 N/A Various dates between June 22, 2023 and September 22, 2023 * Less than 1% of our total outstanding Class A and Class B ordinary shares.
Number of Restricted Shares Outstanding Purchase Price (US$/Share) Date of Grant Sheng Fu 21,415,900 N/A June 22, 2023 Edward Mingyan Sun * N/A June 22, 2023 Thomas Jintao Ren * N/A June 22, 2023 Wu Shengwu * N/A September 22, 2023 All directors and executive officers as a group 31,525,200 N/A Various dates between June 22, 2023 and September 22, 2023 * Less than 1% of our total outstanding Class A and Class B ordinary shares.
The following table summarizes, as of March 31, 2025, the restricted shares that we granted to our current directors and executive officers and to other individuals as a group under our 2011 Plan, 2013 Plan, 2014 Plan and 2023 plan, and which remained outstanding.
The following table summarizes, as of March 31, 2026, the restricted shares that we granted to our current directors and executive officers and to other individuals as a group under our share incentive plans, and which remained outstanding.
Share Ownership For information regarding the share ownership of our directors and officers, see “Item 7. Major Shareholders and Related Party Transactions—A. Major Shareholders.” For information as to share awards granted to our directors, executive officers and other employees, see “Item 6. Directors, Senior Management and Employees—B. Compensation—Share Incentive Awards—Share Incentive Plans.” F.
Major Shareholders and Related Party Transactions—A. Major Shareholders.” For information as to share awards granted to our directors, executive officers and other employees, see “Item 6. Directors, Senior Management and Employees—B. Compensation—Share Incentive Awards—Share Incentive Plans.” F. Disclosure of A Registrant’s Action to Recover Erroneously Awarded Compensation Not applicable.
Peng is mainly responsible for legal compliance, intellectual property, supply chain, administrative management of Kingsoft Corporation Limited and she has extensive experience in these areas. At the same time, Ms. Peng serves as a supervisor of Kingsoft Office (SSE STAR Market: 688111) and the secretary-general of Beijing Kingsoft Foundation. Ms.
Peng is mainly responsible for legal compliance, intellectual property, supply chain, administrative management of Kingsoft Corporation Limited and she has extensive experience in these areas. At the same time, Ms. Peng serves as the secretary-general of Beijing Kingsoft Foundation. Ms. Peng graduated from the University of Science and Technology Beijing in 2001 with a bachelor’s degree in law.
Our board, our compensation committee, or a subcommittee thereof duly authorized for the purpose of the Plan will be the plan administrator of our 2014 Plan.
Types of Awards . The 2014 Plan permits the awards of restricted shares and restricted share units. Plan Administration . Our board, our compensation committee, or a subcommittee thereof duly authorized for the purpose of the Plan will be the plan administrator of our 2014 Plan.
As of March 31, 2025, 91,438,986 restricted shares (excluding those that have been forfeited) had been granted under the 2014 Plan. The following is a summary of the key terms of the 2014 Plan. Types of Awards . The 2014 Plan permits the awards of restricted shares and restricted share units. Plan Administration .
The maximum aggregate number of shares which may be issued pursuant to all awards under the 2014 Plan is 122,545,665 Class A ordinary shares. As of March 31, 2026, 80,288,189 restricted shares (excluding those that have been forfeited) had been granted under the 2014 Plan. The following is a summary of the key terms of the 2014 Plan.
D. Employees We had 713, 845 and 934 employees as of December 31, 2022, 2023 and 2024, respectively. The following table sets forth the number of our employees, categorized by function, as of December 31, 2024: Function Number of Employees Operations 112 Research and development 377 Sales and marketing 256 General and administrative 189 Total 934 E.
The following table sets forth the number of our employees, categorized by function, as of December 31, 2025: Function Number of Employees Operations 109 Research and development 375 Sales and marketing 200 General and administrative 167 Total 851 105 Table of Contents E. Share Ownership For information regarding the share ownership of our directors and officers, see “Item 7.
Removed
Peng graduated from the University of Science and Technology Beijing in 2001 with a bachelor’s degree in law. 104 Table of Contents Wu Shengwu has served as the Chairman of Rongxin Semiconductor Technology Co., Ltd. since 2024.
Added
The 2011 Plan and the 2013 Plan expired in May 2021, and January 2024, respectively, and in accordance with their terms, such that no new awards may be granted under these two plans although outstanding awards granted previously will remain governed by the plans.
Removed
The 2011 Plan Under the 2011 Plan, the maximum number of shares in respect of which awards that may be granted is 100,000,000 ordinary shares of our company as at the date of such grant, excluding any shares awarded that have lapsed or have been forfeited.
Added
D. Employees We had 845, 934 and 851 employees as of December 31, 2023, 2024 and 2025, respectively.
Removed
In May 2011, we issued 100,000,000 ordinary shares that were put on trust for the benefit of participating employees in the 2011 Plan and the 2011 plan has terminated upon its expiration in May 2021, and the remaining 1,326,064 forfeited and unvested restricted shares that have not been granted are cancelled.
Removed
The following paragraphs summarize the key terms of the as amended 2011 Plan. 105 Table of Contents Types of Awards . The 2011 Plan provides for the award of our ordinary shares subject to certain terms and conditions that our board of directors may determine in its absolute discretion. Plan Administration .
Removed
Our board or a committee of our board duly authorized for the purpose of the 2011 Plan shall administer the 2011 Plan. The plan administrator will determine in its absolute discretion the employees to receive the awards, the number of awards to be granted to each selected grantee, and the terms and conditions of each award grant.
Removed
We have set up a trust pursuant to a trust deed to facilitate the administration of the 2011 Plan. Award Notice .
Removed
Share awards granted under the 2011 Plan are evidenced by an award notice that sets forth the terms and conditions for each grant, which relate to vesting, forfeiture or lapse of unvested awarded shares, and repurchase of vested awarded shares. Eligibility .
Removed
We may grant awards to any employee of our company, including without limitation an employee who is also a director of our company or subsidiaries. Lapse of the Awards .
Removed
An award will lapse if (i) the grantee of an award ceases to be an employee of our company or subsidiaries, (ii) the company which employs the selected employee ceases to be a subsidiary of our company, or (iii) there is an ordinary for involuntary wind-up of our company or a resolution is passed for the voluntary wind-up of our company, save for the purposes of an amalgamation, reconstruction or scheme of arrangement.
Removed
Vesting Schedule . The plan administrator determines the vesting schedule, which is set forth in the award notice. Transfer Restrictions . Each award granted under the 2011 Plan are personal to respective grantees and may not be sold, transferred, assigned, charged, mortgaged, or encumbered with any interests in favor of any other third party. 2.
Removed
The 2013 Plan Under the 2013 Plan, the maximum number of our ordinary shares that may be issued is 64,497,718 ordinary shares, and the 2013 plan has terminated upon its expiration in January 2024. As of March 31, 2025, the remaining 805,060 forfeited and unvested restricted shares that have not been granted are cancelled.
Removed
The following is a summary of the key terms of the 2013 Plan. Types of Awards .
Removed
The 2013 Plan provides for the grant of share options and share appreciation rights, in addition to the grant or sale of other share-based awards, such as our ordinary shares, restricted shares and awards that are valued in whole or in part by reference to or based on the fair market value of our ordinary shares. Plan Administration .
Removed
Our board, our compensation committee, or a subcommittee thereof duly authorized for the purpose of the Plan will be the plan administrator of our 2013 Plan.
Removed
The plan administrator has the sole discretion to determine the participants to receive the awards, the number and types of awards to be granted to each participant, and the terms and conditions of each award grant. Award Agreement . Awards under the 2013 Plan are evidenced by an award agreement that sets forth the terms and conditions for each grant.
Removed
Exercise Price . The exercise price, grant price, or purchase price of any award shall be determined by the plan administrator at its sole discretion. Eligibility . We may grant awards to the employees, director or consultant of our company, Kingsoft Corporation or its affiliates. Term of Awards .
Removed
The term of options and share appreciation rights awarded under the 2013 Plan shall be determined by the plan administrator, subject to a maximum term of ten years after the date of grant. The term of other share-based awards shall be determined by the plan administrator. Lapse of Option Awards .
Removed
An option award will lapse if (i) the option has expired, (ii) the participant’s relationship or employment with our company and/or affiliates has been terminated with or without cause pursuant to any applicable laws or under the participant’s service contract with our company and/or affiliates, (ii) winding-up of our company has been commenced, or (iii) otherwise provided for in the award agreement.
Removed
Vesting Schedule . The plan administrator determines the vesting schedule, which is set forth in the award agreement. 106 Table of Contents Transfer Restrictions . An award may not be transferred or assigned by the participant in any manner other than by will or by the laws of descent and distribution, unless otherwise determined by the plan administrator. Termination .
Removed
The 2013 Plan has terminated automatically in January 2024. 3. The 2014 Plan We adopted the 2014 Plan in April 2014. The maximum aggregate number of shares which may be issued pursuant to all awards under the 2014 Plan is 122,545,665 Class A ordinary shares.
Removed
A senior executive officer may terminate his or her employment at any time by giving one month’s prior written notice.
Removed
Our chief executive officer may not be present at any committee meeting during which his compensation is deliberated upon.
Removed
Disclosure of A Registrant’s Action to Recover Erroneously Awarded Compensation Not applicable. 110 Table of Contents

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

30 edited+4 added−6 removed25 unchanged
Item 7. Major Shareholders and Related Party Transactions A. Major Shareholders The following table sets forth information with respect to the beneficial ownership of our shares as of March 31, 2025 by: • each of our current directors and executive officers; and • each person known to us to own beneficially more than 5% of our shares.
Item 7. Major Shareholders and Related Party Transactions A. Major Shareholders The following table sets forth information with respect to the beneficial ownership of our shares as of March 31, 2026 by: • each of our current directors and executive officers; and • each person known to us to own beneficially more than 5% of our shares.
Kingsoft Corporation have delegated approximately 37.4% voting power of our company held by Kingsoft Corporation to Mr. Sheng Fu, effective October 1, 2017. For further details, see “Item 4. Information on the Company—A. History and Development of the Company.” Kingsoft Corporation’s business address is Building D, Xiaomi Campus, No.33 Xierqi Middle Road, Haidian District, Beijing, People’s Republic of China.
Kingsoft Corporation have delegated approximately 36.6% voting power of our company held by Kingsoft Corporation to Mr. Sheng Fu, effective October 1, 2017. For further details, see “Item 4. Information on the Company—A. History and Development of the Company.” Kingsoft Corporation’s business address is Building D, Xiaomi Campus, No.33 Xierqi Middle Road, Haidian District, Beijing, People’s Republic of China.
As of March 31, 2025, to our knowledge, on the same basis of calculation as above, 487,819,310 Class A ordinary shares represented by ADSs, or approximately 31.79% of our total outstanding ordinary shares were held by one record shareholder in the United States, namely The Bank of New York Mellon, the depositary of our ADS program.
As of March 31, 2026, to our knowledge, on the same basis of calculation as above, 487,819,310 Class A ordinary shares represented by ADSs, or approximately 31.29% of our total outstanding ordinary shares were held by one record shareholder in the United States, namely The Bank of New York Mellon, the depositary of our ADS program.
Employment Agreements See “Item 6. Directors, Senior Management and Employees—B. Compensation—Employment Agreements.” 114 Table of Contents Share Incentive Plans “Item 6. Directors, Senior Management and Employees—B. Compensation—Share Incentive Awards—Share Incentive Plans.” Other Transactions with Certain Directors and Affiliates See “Item 6. Directors, Senior Management and Employees—B. Compensation—Compensation of Directors and Officers.” C. Interests of Experts and Counsel Not applicable.
Employment Agreements See “Item 6. Directors, Senior Management and Employees—B. Compensation—Employment Agreements.” Share Incentive Plans “Item 6. Directors, Senior Management and Employees—B. Compensation—Share Incentive Awards—Share Incentive Plans.” Other Transactions with Certain Directors and Affiliates See “Item 6. Directors, Senior Management and Employees—B. Compensation—Compensation of Directors and Officers.” C. Interests of Experts and Counsel Not applicable.
(10) Represents (i) 25,996,440 Class A ordinary shares represented by restricted ADSs and 90,263,128 Class B ordinary shares held by Sheng Global Limited, and (ii) 4,000,000 Class A ordinary shares and 7,300,000 Class B ordinary shares held by FaX Vision Corporation, a British Virgin Islands company controlled by Sheng Global Limited.
(10) Represents (i) 25,996,440 Class A ordinary shares represented by restricted ADSs and 111,679,028 Class B ordinary shares held by Sheng Global Limited, and (ii) 4,000,000 Class A ordinary shares and 7,300,000 Class B ordinary shares held by FaX Vision Corporation, a British Virgin Islands company controlled by Sheng Global Limited.
(3) Represents (i) 25,996,440 Class A ordinary shares represented by restricted ADSs and 90,263,128 Class B ordinary shares held by Sheng Global Limited, a British Virgin Islands company wholly owned by Mr.
(3) Represents (i) 25,996,440 Class A ordinary shares represented by restricted ADSs and 111,679,028 Class B ordinary shares held by Sheng Global Limited, a British Virgin Islands company wholly owned by Mr.
Kingsoft Corporation granted licenses to use, among others, certain technologies, trademarks and software products. Such licenses automatically terminated upon October 1, 2017. We and Kingsoft Corporation entered into a new Trademark Licensing Contract in 2018, under which we are licensed with certain selected trademarks of Kingsoft Corporation and its relevant subsidiaries; • Miscellaneous services .
Such licenses automatically terminated upon October 1, 2017. We and Kingsoft Corporation entered into a new Trademark Licensing Contract in 2018, under which we are licensed with certain selected trademarks of Kingsoft Corporation and its relevant subsidiaries; • Miscellaneous services .
Fu, (ii) 4,000,000 Class A ordinary shares (represented by restricted ADSs) and 7,300,000 Class B ordinary shares beneficially owned by Sheng Global Limited through FaX Vision Corporation, a British Virgin Islands company controlled by Sheng Global Limited, (iii) 585,800 Class B ordinary shares that have vested to Mr.
Fu, (ii) 4,000,000 Class A ordinary shares (represented by restricted ADSs) and 7,300,000 Class B ordinary shares beneficially owned by Sheng Global Limited through FaX Vision Corporation, a British Virgin Islands company controlled by Sheng Global Limited, (iii) 4,176,020 Class A ordinary shares represented by restricted ADSs that have vested to Mr. Fu under our share incentive plans.
For the years ended December 31, 2022, 2023 and 2024, we recognized total revenues of RMB12.5 million, RMB9.6 million and RMB6.7 million (US$0.9 million), respectively, from the Tencent Group, and recognized aggregate fees of RMB20.5 million, RMB13.3 million and RMB19.4 million (US$2.7 million), respectively, to the Tencent Group.
For the years ended December 31, 2023, 2024 and 2025, we recognized total revenues of RMB9.6 million, RMB6.7 million and RMB52.8 million (US$7.6 million), respectively, from the Tencent Group, and recognized aggregate fees of RMB13.3 million, RMB19.4 million and RMB38.4 million (US$5.5 million), respectively, to the Tencent Group.
Organizational Structure—Contractual Arrangements with the VIEs.” Transactions and Agreements with Kingsoft Corporation Kingsoft Corporation is one of our principal shareholders, with beneficial ownership and voting power of 44.0% and 24.8%, respectively, of our outstanding Class A and Class B ordinary shares on an as-converted basis as of March 31, 2025.
Organizational Structure—Contractual Arrangements with the VIEs.” 107 Table of Contents Transactions and Agreements with Kingsoft Group Kingsoft Corporation is one of our principal shareholders, with beneficial ownership and voting power of 43.3% and 24.2%, respectively, of our outstanding Class A and Class B ordinary shares on an as-converted basis as of March 31, 2026.
(8) Represents (i) 5,040,877 Class A ordinary shares, (ii) 6,759,670 Class A ordinary shares represented by ADSs, and (iii) 662,806,049 Class B ordinary shares held by Kingsoft Corporation. Kingsoft Corporation is a Cayman Islands company listed on the Hong Kong Stock Exchange (Stock Code: 3888).
(7) The business address of Dr. Zhang is 6402 Middleburg Ln, Bethesda, MD 20817, USA. (8) Represents (i) 5,040,877 Class A ordinary shares, (ii) 6,759,670 Class A ordinary shares represented by ADSs, and (iii) 662,806,049 Class B ordinary shares held by Kingsoft Corporation. Kingsoft Corporation is a Cayman Islands company listed on the Hong Kong Stock Exchange (Stock Code: 3888).
Accordingly, transactions between us, our subsidiaries and the VIEs, on the one hand, and Kingsoft Corporation or any of its subsidiaries (excluding us and our subsidiaries and VIEs), on the other hand, were “connected transactions.” Under the Hong Kong Listing Rules, all connected transactions must be carried out on normal commercial terms, and if the value of a connected transaction exceeds the applicable thresholds, it was subject to the approval of the independent shareholders of Kingsoft Corporation. 112 Table of Contents Services received from Kingsoft Group Historically, we have entered into various transactions including promotion services, licensing services, cloud services etc.
Accordingly, transactions between us, our subsidiaries and the VIEs, on the one hand, and Kingsoft Corporation or any of its subsidiaries and associates (excluding us and our subsidiaries and VIEs) (collectively, "Kingsoft Group"), on the other hand, were “connected transactions.” Under the Hong Kong Listing Rules, all connected transactions must be carried out on normal commercial terms, and if the value of a connected transaction exceeds the applicable thresholds, it was subject to the approval of the independent shareholders of Kingsoft Corporation.
Percentage of beneficial ownership is based on 1,534,534,235 total issued and outstanding ordinary shares as of March 31, 2025, representing the sum of 518,104,900 Class A ordinary shares and 1,016,429,335 Class B ordinary shares of our company. Beneficial ownership is determined in accordance with the rules and regulations of the SEC.
Percentage of beneficial ownership is based on 1,558,791,885 total issued and outstanding ordinary shares as of March 31, 2026, representing the sum of 518,104,900 Class A ordinary shares and 1,040,686,985 Class B ordinary shares of our company. Beneficial ownership is determined in accordance with the rules and regulations of the SEC.
From 2019, we entered into several service agreements with Live.me, pursuant to which we provide technical, multi-cloud management and other services to Live.me. For the years ended December 31, 2022, 2023 and 2024, we recognized total revenue of RMB33.3 million, RMB35.0 million and RMB27.5 million (US$3.8 million), respectively. Transactions with Pixiu.
For the years ended December 31, 2023, 2024 and for the two months ended February 28, 2025, we recognized total revenue of RMB35.0 million, RMB27.5 million and RMB3.6 million (US$0.5 million), respectively. Transactions with Pixiu. Inc From 2017, we entered into several service agreements with Pixiu. Inc, pursuant to which we provide technical, multi-cloud management and other services to Pixiu.
Shares Beneficially Owned Ordinary Shares Beneficially Owned Voting Power Class A Ordinary Shares Class B Ordinary Shares %(1) %(2) Directors and Executive Officers**: Sheng Fu (3) 31,012,650 100,722,938 8.6 47.1 Bo Peng — — — — Thomas Jintao Ren * * * * Wu Shengwu (5) * — * * Dr. Yi Ma (6) * — * * Dr.
Shares Beneficially Owned Ordinary Shares Beneficially Owned Voting Power Class A Ordinary Shares Class B Ordinary Shares %(1) %(2) Directors and Executive Officers**: Sheng Fu (3) 34,172,460 118,979,028 9.8 47.8 Bo Peng — — — — Thomas Jintao Ren * * * * Wu Shengwu (5) * — * * Dr. Yi Ma (6) * — * * Dr.
For the years ended December 31, 2022 and for the period ended November 30, 2023, we recognized total cost of RMB0.3 million and RMB2.3 million, respectively. From 2018, we entered into several service agreements with Beijing OrionStar, pursuant to which we provide technical and multi-cloud management services to Beijing OrionStar.
From 2018, we entered into several service agreements with Beijing OrionStar, pursuant to which we provide technical and multi-cloud management services to Beijing OrionStar. For the eleven months ended November 30, 2023, we recognized total revenue of RMB2.4 million.
We also purchase cloud services from Kingsoft Group. On July 1, 2022, we entered into a cloud service agreement with a subsidiary of Kingsoft Corporation, pursuant to which, Kingsoft Group provide us with cloud and relevant technical support services for an initial term until August 1, 2023.
On July 1, 2022, we entered into a cloud service agreement with a subsidiary of Kingsoft Corporation, pursuant to which, Kingsoft Group provide us with cloud and relevant technical support services for an initial term until August 1, 2023. Since then, the agreement has been renewed annually and currently remains in effect with an expiration date of August 1, 2027.
We and Tencent Group may enter into individual agreements from time to time accordingly, and except of promotion services, we also purchase cloud services from Tencent Group.
We and Tencent Group may enter into individual agreements from time to time accordingly, and beyond promotion services, we also purchase cloud services from and cooperate with Tencent Group on product distribution and operation.
This agreement governs the following transactions between our company and Kingsoft Corporation: • Promotion services . We and Kingsoft Corporation mutually provided promotion services through their own products and websites for the sale of the other party’s products, including but not limited to pre-installation, bundle promotion, joint operation and publishing online advertisement; • Licensing services .
We and Kingsoft Corporation mutually provided promotion services through their own products and websites for the sale of the other party’s products, including but not limited to pre-installation, bundle promotion, joint operation and publishing online advertisement; • Licensing services . Kingsoft Corporation granted licenses to use, among others, certain technologies, trademarks and software products.
For the years ended December 31, 2022 and for the period ended November 30, 2023, we purchased products from OrionStar of RMB1.1 million and RMB1.0 million, respectively. From December 2018, we entered into several commissioned development and service agreements, with Beijing OrionStar, pursuant to which Beijing OrionStar agrees to provide technical and promotion service to us.
From December 2018, we entered into several commissioned development and service agreements, with Beijing OrionStar, pursuant to which Beijing OrionStar agrees to provide technical and promotion service to us. For the eleven months ended November 30, 2023, we recognized total cost of RMB2.3 million.
Transactions with Tencent Group We entered into a strategic cooperation agreement dated December 27, 2013 with Shenzhen Tencent Computer Systems Company Limited, or Tencent Shenzhen, to promote various types of products of Tencent Holdings Limited, its subsidiaries and their respective associates, or collectively the Tencent Group, through various forms of promotion services on our mobile and PC applications and platforms.
For the years ended December 31, 2023, 2024 and 2025, we recognized aggregate fees of RMB14.2 million, RMB12.2 million and RMB12.7 million (US$1.8 million), respectively, to Kingsoft Corporation, its subsidiaries and their respective associates for the services they provided to us. 108 Table of Contents Transactions with Tencent Group We entered into a strategic cooperation agreement dated December 27, 2013 with Shenzhen Tencent Computer Systems Company Limited, or Tencent Shenzhen, to promote various types of products of Tencent Holdings Limited, its subsidiaries and their respective associates, or collectively the Tencent Group, through various forms of promotion services on our mobile and PC applications and platforms.
In November 2023, 113 Table of Contents we acquired an aggregate of 35.17% equity interest of Beijing OrionStar from certain of the existing shareholders of Beijing OrionStar with an aggregate cash consideration of RMB268.7 million (US$37.8 million).
In November 2023, we acquired an aggregate of 35.17% equity interest of Beijing OrionStar from certain of the existing shareholders of Beijing OrionStar with an aggregate cash consideration of RMB268.7 million (US$37.8 million). Upon completion of the transaction, our equity interest in Beijing OrionStar increased to 72.91% and consolidated the financial results of Beijing OrionStar since November 30, 2023.
From time to time with Kingsoft Corporation, its subsidiaries and their respective associates, or collectively the Kingsoft Group. We entered into a cooperation framework agreement with Kingsoft Corporation on December 27, 2013 for an initial term until December 31, 2016. Upon expiration of the initial term, the agreement was automatically renewed for three years pursuant to its terms.
Services received from Kingsoft Group Historically, we have entered into various transactions including promotion services, licensing services, cloud services etc. From time to time with Kingsoft Corporation, its subsidiaries and their respective associates, or collectively the Kingsoft Group. We entered into a cooperation framework agreement with Kingsoft Corporation on December 27, 2013 for an initial term until December 31, 2016.
Subsequent to the amendment, we own 49.6% equity interest of Live.me and deconsolidated Live.me as we are no longer a majority shareholder of Live.me. In February 2025, Live.me ceased to be a related party of ours when Live.me redeemed all of our shares in Live.me, and we no longer holder any equity interest in Live.me.
Subsequent to the amendment, we own 49.6% equity interest of Live.me and deconsolidated Live.me as we are no longer a majority shareholder of Live.me.
Registration Rights Agreement Pursuant to the registration rights agreement dated April 25, 2014 with Kingsoft Corporation, Xiaomi Ventures Limited and Baidu Holdings Limited, we agreed to grant each of the parties Form F-3 registration rights and the piggyback registration rights.
For the years ended December 31, 2023, 2024 and 2025, we recognized total revenue of RMB1.0 million, RMB1.2 million and RMB1.1 million (US$0.2 million), respectively. 109 Table of Contents Registration Rights Agreement Pursuant to the registration rights agreement dated April 25, 2014 with Kingsoft Corporation, Xiaomi Ventures Limited and Baidu Holdings Limited, we agreed to grant each of the parties Form F-3 registration rights and the piggyback registration rights.
Upon completion of the transaction, our equity interest in Beijing OrionStar increased to 72.91% and consolidated the financial results of Beijing OrionStar since November 30, 2023. Consequently, transactions with Beijing OrionStar should no longer be considered as related party transactions from that date onwards. From 2018, we entered into distribution and several AI robots purchase agreements with Beijing OrionStar.
Consequently, transactions with Beijing OrionStar should no longer be considered as related party transactions from that date onwards. From 2018, we entered into distribution and several AI robots purchase agreements with Beijing OrionStar. For the eleven months ended November 30, 2023, we purchased products from OrionStar of RMB1.0 million.
Yun Zhang (7) * — * * Edward Mingyan Sun * * * * All directors and executive officers as a group 37,040,470 115,012,738 9.9 48.5 Principal Shareholders: Kingsoft Corporation Limited (8) 11,800,547 662,806,049 44.0 24.8 Tencent Holdings Limited (9) 15,031,120 220,481,928 15.3 20.8 Sheng Global Limited (10) 29,996,440 97,563,128 8.3 9.4 Notes * Less than 1% of our total outstanding Class A and Class B ordinary shares. ** Unless otherwise indicated in the notes below, the business address for our directors and executive officers is Building No. 11Wandong Science and Technology Cultural Innovation Park No.7 Sanjianfangnanli, Chaoyang District, Beijing 100024, People’s Republic of China.
Yun Zhang (7) * — * * Edward Mingyan Sun * * * * All directors and executive officers as a group 42,110,830 136,110,578 11.4 49.4 Principal Shareholders: Kingsoft Corporation Limited (8) 11,800,547 662,806,049 43.3 24.2 Tencent Holdings Limited (9) 15,031,120 220,481,928 15.1 20.3 Sheng Global Limited (10) 29,996,440 118,979,028 9.6 11.2 Notes * Less than 1% of our total outstanding Class A and Class B ordinary shares. ** Unless otherwise indicated in the notes below, the business address for our directors and executive officers is Building No. 11Wandong Science and Technology Cultural Innovation Park No.7 Sanjianfangnanli, Chaoyang District, Beijing 100024, People’s Republic of China. 106 Table of Contents (1) Percentage ownership is calculated by dividing the number of Class A and Class B ordinary shares beneficially owned by a given person or group by the sum of (i) 1,558,791,885 ordinary shares and (ii) the number of Class A and Class B ordinary shares that such person or group has the right to acquire upon exercise of option, warrant or other right within 60 days after March 31, 2026.
(5) The business address of Wu Shengwu is No. 599, Changjiang East Road, Huaiyin District, Huai'an City, Jiangsu Province (6) The business address of Dr. Ma is ECS Department, 333A Cory Hall#1770 University of California, Berkeley, CA 94720-1770, USA. (7) The business address of Dr. Zhang is 6402 Middleburg Ln, Bethesda, MD 20817, USA.
Peng is c/o Kingsoft Corporation Limited, Building D, Xiaomi Campus, No.33 Xierqi Middle Road, Haidian District, Beijing, People’s Republic of China. (5) The business address of Wu Shengwu is No. 599, Changjiang East Road, Huaiyin District, Huai'an City, Jiangsu Province (6) The business address of Dr. Ma is ECS Department, 333A Cory Hall#1770 University of California, Berkeley, CA 94720-1770, USA.
The conversion features were considered as embedded derivatives that do not meet the criteria to be bifurcated and were accounted for together with the loan receivable.
In 2021, we provided a convertible loan of RMB100.0 million at an annual simple interest rate of 8% with 2 years maturity to Beijing OrionStar. The conversion features were considered as embedded derivatives that do not meet the criteria to be bifurcated and were accounted for together with the loan receivable.
Fu under our 2011 Plan, and (iv) 1,016,210 Class A ordinary shares and 2,574,010 Class B ordinary shares that have vested to Mr. Fu under our 2013 Plan. Kingsoft Corporation have delegated approximately 37.4% voting power of our company held by Kingsoft Corporation to Mr. Sheng Fu, effective October 1, 2017. For further details, see “Item 4.
Kingsoft Corporation have delegated approximately 36.6% voting power of our company held by Kingsoft Corporation to Mr. Sheng Fu, effective October 1, 2017. For further details, see “Item 4. Information on the Company—A. History and Development of the Company”. (4) The business address of Ms.
Removed
(1) Percentage ownership is calculated by dividing the number of Class A and Class B ordinary shares beneficially owned by a given person or group by the sum of (i) 1,534,534,235 ordinary shares and (ii) the number of Class A and Class B ordinary shares that such person or group has the right to acquire upon exercise of option, warrant or other right within 60 days after March 31, 2025.
Added
Upon expiration of the initial term, the agreement was automatically renewed for three years pursuant to its terms. This agreement governs the following transactions between our company and Kingsoft Corporation: • Promotion services .
Removed
Information on the Company—A. History and Development of the Company”. 111 Table of Contents (4) The business address of Ms. Peng is c/o Kingsoft Corporation Limited, Building D, Xiaomi Campus, No.33 Xierqi Middle Road, Haidian District, Beijing, People’s Republic of China.
Added
In October 2025, the exclusive license was converted to a non-exclusive license. In addition, in December 2025, the parties entered into an asset transfer agreement pursuant to which the relevant assets relating to the Japanese version of the office software will be transferred to Kingsoft Group, upon completion of which the licensing arrangement will be terminated.
Removed
Since then, the agreement has been renewed annually and c urrently remains in effect with an expiration date of August 1, 2025.
Added
In October 2025, Kingsoft Japan repurchased certain equity interests held by Kingsoft Corporation and its associates for a total consideration of RMB14.5 million (US$2.1 million). Upon completion of the repurchase, our company's equity interest in Kingsoft Japan increased from 41.15% to 57.71% on a diluted basis. We also purchase cloud services from Kingsoft Group.
Removed
For the years ended December 31, 2022, 2023 and 2024, we recognized aggregate fees of RMB15.2 million, RMB14.2 million and RMB12.2 million (US$1.7 million), respectively, to Kingsoft Corporation, its subsidiaries and their respective associates for the services they provided to us.
Added
In February 2025, Live.me ceased to be a related party of ours when Live.me redeemed all of our shares in Live.me, and we no longer holder any equity interest in Live.me. From 2019, we entered into several service agreements with Live.me, pursuant to which we provide technical, multi-cloud management and other services to Live.me.
Removed
For the years ended December 31, 2022 and for the period ended November 30, 2023, we recognized total revenue of RMB2.6 million and RMB2.4 million, respectively. In 2021, we provided a convertible loan of RMB100.0 million at an annual simple interest rate of 8% with 2 years maturity to Beijing OrionStar.
Removed
Inc From 2017, we entered into several service agreements with Pixiu. Inc, pursuant to which we provide technical, multi-cloud management and other services to Pixiu. Inc. For the years ended December 31, 2022, 2023 and 2024, we recognized total revenue of RMB0.4 million, RMB1.0 million and RMB1.2 million (US$0.2 million), respectively.

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