Live Conference Call to be Held at 9:30 PM U.S. Eastern Time on March 12, 2024

BEIJING, China, March 13, 2024 — Phoenix New Media Limited (NYSE: FENG) ("Phoenix New Media", "ifeng" or the "Company"), a leading new media company in China, today announced its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2023.
Mr. Yusheng Sun, CEO of Phoenix New Media, stated, "In the fourth quarter of 2023, we focused on boosting our content productivity, and the monetization of our content and event marketing offerings. Moving forward, we will maintain our dedication to fostering operational excellence and strategic innovation to achieve our financial objectives."

Fourth quarter 2023 Financial Results

REVENUES

Total revenues in the fourth quarter of 2023 decreased by 5.4% to RMB211.8 million (US$29.8 million) from RMB223.9 million in the same period of 2022, primarily due to the year-over-year decline in both the Company's net advertising revenues and paid services revenues.

Net advertising revenues in the fourth quarter of 2023 decreased by 4.1% to RMB197.0 million (US$27.7 million) from RMB205.4 million in the same period of 2022, primarily due to the reduction in advertising spending of advertisers from certain industries and intensified industry-wide competition.
Paid services revenues in the fourth quarter of 2023 decreased by 20.0% to RMB14.8 million (US$2.1 million) from RMB18.5 million in the same period of 2022. Paid services revenues comprise (i) revenues from paid contents, mainly including digital reading, audio books, and paid videos, and (ii) revenues from E-commerce and others. Revenues from paid contents in the fourth quarter of 2023 increased by 29.1% to RMB7.1 million (US$1.0 million) from RMB5.5 million in the same period of 2022, mainly due to the increase in the content spending of certain customers in the fourth quarter of 2023. Revenues from E-commerce and others in the fourth quarter of 2023 decreased by 40.8% to RMB7.7 million (US$1.1 million) from RMB13.0 million in the same period of 2022, mainly due to the decline in E-commerce revenues.

COST OF REVENUES AND GROSS PROFIT

Cost of revenues in the fourth quarter of 2023 decreased by 11.3% to RMB120.5 million (US$16.9 million) from RMB135.8 million in the same period of 2022, as a result of the Company's strict cost control measures.
Gross profit in the fourth quarter of 2023 increased by 3.6% to RMB91.3 million (US$12.9 million) from RMB88.1 million in the same period of 2022. Gross margin in the fourth quarter of 2023 was 43.1%, compared to 39.4% in the same period of 2022.
To supplement the financial measures presented in accordance with the United States Generally Accepted Accounting Principles ("GAAP"), the Company has presented certain non-GAAP financial measures in this press release, which excluded the impact of certain reconciling items as stated in the "Use of Non-GAAP Financial Measures" section below. The related reconciliations to GAAP financial measures are presented in the accompanying "Unaudited Reconciliations of Non-GAAP Results of Operation Measures to the Nearest Comparable GAAP Measures."
Non-GAAP gross margin in the fourth quarter of 2023, which excluded share-based compensation, increased to 43.1% from 39.5% in the same period of 2022.

OPERATING EXPENSES AND INCOME FROM OPERATIONS

Total operating expenses in the fourth quarter of 2023 increased by 65.2% to RMB68.4 million (US$9.6 million) from RMB41.4 million in the same period of 2022, primarily attributable to the increase in general and administrative expenses. General and administrative expenses was much lower in the fourth quarter of 2022 as compared to the fourth quarter of 2023 primarily because the Company reversed more allowance for credit losses in the fourth quarter of 2022 due to the collection of some long-aged accounts receivables in that quarter.
Income from operations in the fourth quarter of 2023 was RMB22.9 million (US$3.3 million), compared to income from operations of RMB46.7 million in the same period of 2022. Operating margin in the fourth quarter of 2023 was 10.8%, compared to 20.9% in the same period of 2022.
Non-GAAP income from operations in the fourth quarter of 2023, which excluded share-based compensation, was RMB23.1 million (US$3.3 million), compared to non-GAAP income from operations of RMB47.3 million in the same period of 2022. Non-GAAP operating margin in the fourth quarter of 2023, which excluded share-based compensation, was 10.9%, compared to 21.1% in the same period of 2022.

OTHER INCOME OR LOSS

Other income or loss reflects net interest income, foreign currency exchange gain or loss, income or loss from equity investments, including impairment, fair value changes in investments, net, and others, net. Total net other income in the fourth quarter of 2023 was RMB2.0 million (US$0.3 million), compared to total net other income of RMB6.0 million in the same period of 2022, which mainly consisted of the following items:

• Net interest income in the fourth quarter of 2023 was RMB7.6 million (US$1.1 million), compared to net interest income of RMB4.2 million in the same period of 2022.
• Foreign currency exchange gain in the fourth quarter of 2023 was RMB2.1 million (US$0.3 million), compared to a foreign currency exchange gain of RMB4.2 million in the same period of 2022.
• Loss from equity method investments,including impairment was RMB10.8 million (US$1.5 million) in the fourth quarter of 2023, compared to loss from equity method investments, including impairment of RMB7.4 million in the same period of 2022, which were mainly attributable to the changes in estimated fair value of the underlying investments held by the limited partnerships accounted for under the equity method.
• Others, net, in the fourth quarter of 2023 was a gain of RMB3.7 million (US$0.5 million), compared to a gain of RMB5.5 million in the same period of 2022. Others, net primarily consists of some non-operating gain or loss.

NET INCOME ATTRIBUTABLE TO PHOENIX NEW MEDIA LIMITED

Net income attributable to Phoenix New Media Limited in the fourth quarter of 2023 was RMB8.1 million (US$1.1 million), compared to net income attributable to Phoenix New Media Limited of RMB41.6 million in the same period of 2022. Net margin in the fourth quarter of 2023 was 3.8%, compared to 18.6% in the same period of 2022. Net income per basic and diluted ordinary share in the fourth quarter of 2023 were both RMB0.01 (US$0.00), compared to net income per basic and diluted ordinary share of RMB0.07 in the same period of 2022.
Non-GAAP net income attributable to Phoenix New Media Limited, which excluded share-based compensation, income or loss from equity investments, including impairment, net, and fair value changes in investments, was RMB19.6 million (US$2.8 million) in the fourth quarter of 2023, compared to non-GAAP net income attributable to Phoenix New Media Limited of RMB50.0 million in the same period of 2022. Non-GAAP net margin in the fourth quarter of 2023 was 9.3%, compared to 22.3% in the same period of 2022. Non-GAAP net income per basic and diluted ADS in the fourth quarter of 2023 were both RMB1.62 (US$0.23), compared to non-GAAP net income per basic and diluted ADS of RMB4.12 in the same period of 2022. "ADS(s)" refers to the Company's American Depositary Share(s), each representing 48 Class A ordinary shares of the Company.
In the fourth quarter of 2023, the Company's weighted average number of ADSs used in the computation of basic and diluted net income per ADS was 12,124,938. As of December 31, 2023, the Company had a total of 580,280,245 ordinary shares outstanding, or the equivalent of 12,089,172 ADSs.

Full Year 2023 Financial Results

REVENUES

Total revenues in 2023 decreased by 11.9% to RMB692.0 million (US$97.5 million) from RMB785.7 million in 2022, primarily attributable to the year-over-year decline in both the Company's net advertising revenues and paid services revenues.

Net advertising revenues in 2023 decreased by 11.1% to RMB619.3 million (US$87.3 million) from RMB696.7 million in 2022, primarily due to the reduction in advertising spending of advertisers from certain industries and intensified industry-wide competition.

Paid services revenues in 2023 decreased by 18.3% to RMB72.7 million (US$10.2 million) from RMB89.0 million in 2022, primarily attributable to the decrease in E-commerce revenues as the Company closed certain E-commerce business.

COST OF REVENUES AND GROSS PROFIT

Cost of revenues in 2023 decreased by 15.4% to RMB464.1 million (US$65.4 million) from RMB548.5 million in 2022, as a result of the Company's strict cost control measures.

Gross profit in 2023 decreased to RMB227.9 million (US$32.1 million) from RMB237.2 million in 2022. Gross margin in 2023 increased to 32.9% from 30.2% in 2022, mainly due to the Company's effective cost control measures.

OPERATING EXPENSES AND LOSS FROM OPERATIONS

Total operating expense in 2023 decreased by 17.5% to RMB353.6 million (US$49.8 million) from RMB428.6 million in 2022, primarily attributable to the decrease in certain operating expense items as a result of the strict cost control measures taken in 2023, partially off-set by the increase in allowance for credit losses in 2023 as the Company reversed more allowance for credit losses in 2022 due to the collection of some long-aged accounts receivables.

Loss from operations in 2023 was RMB125.7 million (US$17.7 million), compared to RMB191.4 million in 2022. Operating margin in 2023 was negative 18.2%, compared to negative 24.4% in 2022.

Non-GAAP loss from operations in 2023, which excluded share-based compensation, was RMB122.0 million (US$17.2 million), compared to RMB183.6 million in 2022. Non-GAAP operating margin in 2023, which excluded share-based compensation, was negative 17.6%, compared to negative 23.4% in 2022.

INCOME TAX EXPENSE OR BENEFIT

Income tax expense was RMB13.0 million (US$1.8 million) in 2023, as the Company increased the valuation allowance for the tax effect of operating loss recognized in 2023. Income tax benefit was RMB70.4 million in 2022, as the Company recognized an income tax benefit of RMB64.4 million in 2022, which represented the difference between the actual withholding tax paid related to the gain on disposal of available-for-sale debt investments in Particle and the previously accrued withholding tax.

NET LOSS ATTRIBUTABLE TO PHOENIX NEW MEDIA LIMITED

Net loss attributable to the Company in 2023 was RMB102.5 million (US$14.4 million), compared to net loss attributable to the Company of RMB109.7 million in 2022. Net margin in 2023 was negative 14.8%, compared to negative 14.0% in 2022. Net loss per basic and diluted ordinary share in 2023 were both RMB0.18 (US$0.02), compared to net loss per basic and diluted ordinary share of RMB0.19 in 2022.

Non-GAAP net loss attributable to the Company in the fiscal year of 2023, which excluded share-based compensation, income or loss from equity method investments, including impairment, fair value changes in investments, net, income tax benefit related to the gain on disposal of available-for-sale debt investments and impairment of available-for-sale debt investment, was RMB87.2 million (US$12.3 million), compared to non-GAAP net loss attributable to the Company of RMB154.6 million in 2022. Non-GAAP net margin in the fiscal year of 2023 was negative 12.6%, compared to negative 19.7% in 2022. Non-GAAP net loss per basic and diluted ADS in 2023 were both RMB7.19 (US$1.01), compared to non-GAAP net loss per basic and diluted ADS of RMB12.74 in 2022.

CERTAIN BALANCE SHEET ITEMS

As of December 31, 2023, the Company's cash and cash equivalents, term deposits and short term investments and restricted cash were RMB1.09 billion (US$154.0 million).

Business Outlook
For the first quarter of 2024, the Company expects its total revenues to be between RMB130.8 million and RMB145.8 million; net advertising revenues are expected to be between RMB121.3 million and RMB131.3 million; and paid services revenues are expected to be between RMB9.5 million and RMB14.5 million.
All of the above forecasts reflect the current and preliminary view of the Company's management, which are subject to changes and substantial uncertainty, particularly in view of the uncertainty of macroeconomic environment.

Share Repurchase Program

The Company announced a share repurchase program in September 2023. The program was completed in February 2024. The Company repurchased 120,981 ADSs for a total cost of US$0.2 million under the program.

Conference Call Information
The Company will hold a conference call at 9:30 p.m. U.S. Eastern Time on March 12, 2024 (March 13, 2024 at 9:30 a.m. Beijing/Hong Kong time) to discuss its fourth quarter and fiscal year 2023 unaudited financial results and operating performance.
To participate in the call, please register in advance of the conference by clicking here. Upon registering, each participant will receive the participant dial-in numbers and a unique access PIN, which will be used to join the conference call. Please dial in 10 minutes before the call is scheduled to begin.
A live and archived webcast of the conference call will also be available at the Company's investor relations website at http://ir.ifeng.com.

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