Cheetah Mobile Inc. announced it has entered into a new strategic cooperation agreement with Shenzhen Tencent Computer Systems Company Limited (Tencent Shenzhen), a subsidiary of Tencent Holdings Limited (Tencent), for the two-year period from January 2016 until December 2017.
Under the terms of the new agreement, Cheetah Mobile and Tencent will continue to provide promotion services for each other. The table below sets out the actual transaction amounts of the promotion services provided by each party to the other party for the year ended December 31, 2014 and the eleven months ended November 30, 2015
Sheng Fu, Cheetah Mobile’s Chief Executive Officer, stated, “We are delighted to continue our strong partnership with Tencent, one of the world’s leading companies in the Internet and mobile technology space. The demand from advertisers for our mobile advertising services on the GDT ad platform continues to grow, which helps us further extend our advertiser reach and monetization capabilities in the domestic market. Furthermore, by leveraging Tencent’s tremendous user base and traffic from its various products and platforms, we are able to further grow Cheetah’s market share, brand recognition and mobile user base in China, each of which are key components of the Company’s global strategy. Looking forward, we will continue to work closely with our partners, to build one of the best mobile advertising platforms for advertisers globally.”
On December 27, 2013, Cheetah Mobile and Tencent Shenzhen initially entered into a strategic cooperation agreement, which was amended on July 31, 2014, January 30, 2015, June 30, 2015 and November 5, 2015. Pursuant to the agreement, Cheetah Mobile would, through its PC and mobile products and platforms (including licensed products and platforms), provide various forms of promotional services to Tencent for various types of products. Under the amendment on November 5, 2015, the annual cap with respect to the fees payable by Tencent to Cheetah for the year ending December 31, 2015 was increased to RMB340 million.
Additionally, on January 30, 2015, Cheetah Mobile and Tencent expanded scope of strategic cooperation agreement, pursuant to which Tencent agrees to provide promotional services to Cheetah Mobile, subject to an annual cap of RMB100 million for the year ended December 31, 2015.