Started to switch MG model to revenue-sharing model we got more reasonable MG, and we have the positive feedback. And the fourth, the optimize of the technology and the operation strategy related to and the storage capability and improved utilization of our service and equipment. Our operational costs decreased year-over-year based on the sequentially. While the decrease of social entertainment revenue and the change of revenue mix in social entertainment revenue has a negative impact on gross margin. Looking forward to 2023, all these positive factors will be continued and the negative factors also can also be continued. We will continue to expand the suite of monetization tools such as AD supported advertisement, artist-related merchandise, super VIP membership and we expect our online music revenue will keep growth.
So, we will continue to forecast €“ to focus on increased efficiency of all business units and tightened our cost terms control in 2023. So, we expect our gross margin will be increased on a year-over-year basis in 2023.
Operator: Thank you. And our next question from Lincoln Kong from Goldman Sachs. Lincoln, your line is open. Please un-mute yourself and go ahead.
Lincoln Kong: Thank you, management. Congrats on the good results. My question is on the enterprising business. How do we see so far, let’s say, year-to-date enterprising demand recovery for us? And we talk about this ad support model. So, in terms of the new format of ads or creating more ad inventory, how do we think about the progress here especially how to better monetize our game i.e. into €˜23. What’s our outlook here?
Tony Yip: Yes. Thank you for your question. We continued to see a recovery in the advertising revenues, especially following the reopening post-COVID. The splash screen ad continued to recover at a healthy pace. In addition to that, ad-supported mode advertising continued to ramp up and currently account for roughly about mid-teens percentage of the advertising revenue. And then thirdly, in terms of sponsorship advertising, while during the fourth quarter, it temporarily weakened due to COVID. We do expect with the reopening, there to be many more live events and as a result, advertising €“ sponsorship advertising opportunities. So, all-in-all, we do expect this year to be a strong recovery year and a year of positive growth for the ad business.
And then in terms of verticals, in the fourth quarter, given the e-commerce seasonality, we did saw a meaningful increase in the e-commerce vertical. And then in addition to that, Internet services in general, food and beverages, consumer electronics as well as local services are also verticals where we saw continued demand from advertisers.
Operator: Thank you. And our next question comes from Lei Zhang from Bank of America Securities. Lei Zhang, your line is open. Please un-mute yourself and go ahead.
Lei Zhang: Hi management. Thank you for taking my question and congrats on the solid results. My question is mainly regarding your sales and marketing and investment plan in 2023 since we have a pretty good cost control last year, so can you give us more color for 2023? Thank you.
Shirley Hu: Okay. About the selling and the promotion expenses, we have taken tight control on selling and marketing expenses in Q4 continuously and resulting in a 65% decrease on a year-over-year basis. And we balanced MAUs and monetization when evaluating the healthiness of business. We focus more on managing such as level of user engagement, user retention reach and paying users. We will further monitor our eye of each promotion channel and manage the internal and external resources more effectively, improve efficiency of selling and marketing expenses in the future. In 2023, selling and promotion expenses will be operated at a very low level and will be continued to decrease on a year-over-year basis, but the cutting degree will be limited compared to those in 2022. And in 2023, we will invest in the content promotion, so that will be a new way for our upgrading our MAUs, yes.
Operator: Thank you. And our next question comes from Wei Xiong from UBS. Wei Xiong, your line is open. Please un-mute yourself and go ahead.
