We operate in the rapidly evolving internet industry, which makes it difficult
to predict our future results of operations. Accordingly, our future prospects
are subject to the risks and uncertainties experienced by companies in evolving
industries. Some of these risks and uncertainties relate to our ability to, among
others:
successfully implement our plan to further develop and monetize our
mobile platform both in China and globally;
offer new, innovative products and services and enhance our existing
products and services with innovative and advanced technology to attract and
retain a larger user base;
retain existing customers and attract additional customers and increase
spending per customer;
maintain our relationships with important suppliers, such as bandwidth
suppliers, on favorable terms;
respond to evolving user preferences and industry changes;
respond to competitive market conditions;
upgrade our technology to support increased traffic and expanded product
and service offerings;
maintain effective control of our costs and expenses;
respond to changes in the regulatory environment in China and overseas
markets and manage legal risks, including those associated with intellectual
property rights; and
execute our strategic investments and acquisitions and post-acquisition integrations
effectively.
The number of people who access the internet through mobile devices is increasing
dramatically. The varying display sizes, functionality, and memory associated
with mobile devices make the use of our applications on such devices more difficult
and the versions of our applications developed for these devices may not be
compelling to users, manufacturers or distributors of devices. Each manufacturer
or distributor may establish unique technical standards for its devices, and
our applications may not work or be accessible on these devices. Some manufacturers
may also elect not to include our applications on their devices. As new devices
and new platforms are continually being released, it is difficult to predict
the problems we may encounter in developing versions of our applications for
use on these mobile devices and we may need to devote significant resources
to the creation, support, and maintenance of our applications tailored for such
devices. If we are unable to attract and retain a substantial number of mobile
device manufacturers, distributors, and users to adopt and use our applications,
or if we are slow to develop products and technologies that are more compatible
with mobile devices, our business could be adversely affected.
Our users rely on our utility products and related services to optimize the
performance of their mobile devices, provide real time protection against security
threats, and gain personalized mobile device experience. Our applications are
highly technical and complex and, when deployed, may contain defects or security
vulnerabilities. Some errors in our products may only be discovered after a
product has been installed and used by our users.
Our applications for users rely on our cloud-based data analytics engines to
optimize system performance and protect against security threats. The data analytics
engines include our most up-to-date security threats library and application
behavior library in the cloud, and our applications only include a subset of
these libraries on the users’ end devices. If our data analytics engines
do not function properly, or if the infrastructure supporting the data analytics
engine malfunctions, our applications may not achieve optimal results.
Our cloud-based data analytics engines employ a heuristic, or experience-based,
approach to detect unknown security threats and behavior of unknown mobile applications.
However, new malware and malicious applications are constantly appearing and
evolving, and our detection technologies may not detect all forms of security
threats or malicious applications encountered by our users. In addition, our
applications may not work properly with the Windows, Android or iOS operating
systems if we cannot promptly upgrade our applications following any changes
or updates to these operating systems. We previously experienced system disruption
due to compatibility issues resulting from an update to the Windows operating
system.
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