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WB: Less Impacted By Weakness Of The Economy Due To Better Event Budgets in 1Q22

WB will report 4Q21 results on March 3rd before the US market open with a 6am ET conference call. We are positive on WB’s 4Q21 and potential 1Q22 performance. As a unique social media broadcasting and discussion platform, WB attracted more events budgets for the New Year’s Eve celebration, Chinese New Year Holidays, and the Olympic Games. In addition, social topics were discussed on the platform. While the weakness in China’s economy starting from December 2021 has negative impacts to the advertising industry, we believe WB is less impacted compared with others. The traffic on Weibo showed a significant uptick due to the Beijing 2022 Winter Olympics in February. In the near-term, we believe the government is likely to put stimulus measures in place at a faster pace than expected. Therefore, it is likely that the ad budgets are going to recover soon as a result of such stimulus.