Rui Chen: We raised the target of reach breakeven by end of 2024, and we will stick to that mission and goal. And as we move through 2022, obviously, there is been multiple challenges across the macro environment to reduce loss and putting profitability first is the priority for the company. And this is something I personally work after and taking charge. We have already taken actions to reduce our cost and expense. And so far, the unit cost for our server and bandwidth continue to decline. And as I mentioned earlier, sales and marketing continued to decline year-on-year for three consecutive quarters. And move forward, we will take more efforts to reduce our sales and marketing expense as well as G&A and R&D expenses. In terms of the efficiency improvement, I intend to reduce investment on the non-core business and allocating and centralize our resources in areas such as improving our commercialization efficiencies.
At the same time, we will also take actions to optimize our organizational structure to reduce the fat and increase the lean, and we expect this adjustment will be completed by end of this year and will start to show on P&L starting from first quarter next year.
Sam Fan: Yes. I will take the question in regard to the gross margin and expense trend. The company takes out more actions to reduce costs and prioritize probability. We expect our gross margin will gradually increase going forward. Sales and marketing expense in 2022 has already declined year-over-year, as mentioned by our Chairman and will continue to decline next year. And we expect R&D expenses, which will peak in Q4 this year and start to decline next year. In 2023 and the future period, we expect overall operating expenses in absolute dollar terms will decline year-over-year, and net loss will further narrow down until reach our breakeven target. At the same time, we are paying very close attention to our cash flow and tightly controlled CapEx and investment as we narrow our losses. We aim to keep our cash balance at a healthy level.
Juliet Yang: Thank you, operator. We can take the next question.
Operator: Thank you. Next question is from the line of Xueqing Zhang from CICC. Please go ahead.
Xueqing Zhang: My question in regards to advertising, considering the impact of COVID-19 and the weak macro environment, what’s your strategy for advertising business and how should we think about revenue growth in the first quarter and next year? In addition, during the Double 11, we noticed that Bilibili has advertising products related content e-commerce could management share more details about it? And I also want to know, is Bilibili considering launching Tojo at the present? Thank you.
Carly Li: Despite weaken macro environment of the ad revenue in third quarter reached RMB1.35 billion, an increased 16% year-over-year. This €“ we consider this is a job well done and especially the ad revenue from performance-related formats increased by over 20% year-over-year, and we have continued to take market share in the ad market. In 2023, we plan to continue to enhance our integrated marketing capability and to build a friendly and welcoming environment for advertisers. And we will continue to help advertisers to effectively reach our young generation through Bilibili’s multiple products and multiple scenarios and help them to build their brand equity. And we intend to further combine our content ecosystem with our ad business, particularly in those €“ in our drilling vertical increase our ad inventory and accelerate ad momentum in the consumption and transaction scenarios.
