Xu Zuori: We focus on the company's operations.

Abstract: Qihoo 360 CFO Xu Zuori recently interviewed by Bloomberg Television. Xu Zuori said Qihoo 360 had started the commercialization of search and mobile-end businesses in the fourth quarter of last year and in the first quarter of this year, with revenue growth in 2013

Qihoo 360 CFO Xu Zuori recently received an interview with Bloomberg Television. Xu Zuori said that Qihoo 360 had started the commercialization of search and mobile services in the fourth quarter of last year and in the first quarter of this year, and that 2013 would be an important driver of revenue growth. For the search business, 360 is indeed in the hands of a scramble for market share from Baidu, while on the mobile side, for a few weeks before the 360 apps were Apple itunes Store under the shelf, 360 is still in the communication with Apple, so far still failed to restore 360 of the application to the shelves, the future, Qihoo 360 Mobile End commercialization will be mainly on the Androping stage.

The following is the transcript of this interview:

Reporter: First of all, let's take a look at the 2012 quarterly results you've just made, and after you've made your earnings, Jefferies your stock rating to "hold", what were your expectations for the first quarter of 2013?

Xu Zuori: Our expectations for the first quarter are high, with revenues projected at 104.5 million to 106.5 million dollars. It is clear that there are many reasons for stock price changes and we are only focused on the operation of the company. We think that with the launch and commercialization of our search business, coupled with our first-quarter commercialization of mobile-end businesses, our growth potential for the first quarter and for the full year of 2013 is huge.

Interviewer: Let's take a look at your line of business, first of all, the mobile end, you will be spending more on the mobile side, how important is the mobile end for you? How do you plan to invest more in this?

Xu Zuori: It's not just us, it's important for all our industry competitors to move the end. We are also starting from the security field on the mobile side, by the end of 2012, we have more than 200 million users in the field of mobile phone security, we also have the largest application store products on the China National Security Platform, which is a good basis for our commercialization. We've been more focused on increasing the number of users in the past, but as I mentioned earlier, starting in the first quarter of 2013, we're going to start the commercialization of mobile-end products, and we've got good feedback in this area.

Reporter: You launched your own search engine last August, how will you compete with Baidu? Now that you're starting a commercial search business, how does this work?

Xu Zuori: We think the most important thing to compete with Baidu is the competition for quality of search and user experience. We started out as Internet security products, so the brand image we create for our search business is "clean" and "safe" compared to our competitors. In terms of commercialization, we launched our own search commercialization system last December and started working with Google on the commercialisation of search this year, both of which are progressing smoothly and revenues are growing. So we believe that 2013 and further search will be an important driver of our overall revenue.

Journalist: Are you currently robbing the market share from Baidu?

Xu Zuori: I think so, when we first launched the search engine about four months ago, the industry thought we had about 8% to 10% of the market, and I think according to third party data, we have about 12% to 13% market share, from this point of view, We are, of course, grabbing market share from our competitors.

Journalist: How do you get users? How do you make users change their search habits?

Xu Zuori: I think there are several aspects, the most important of course is product quality and user experience. Since we launched our search business, we've been trying to increase our comprehensiveness, and in the past few months we've added image search, music search, map search, and a Wikipedia-like product to provide a "one-stop" search service for users like other big search engines. Second, we have a powerful browser product, which is an excellent distribution of various Internet products including search business channels, which can help us gradually increase the market share of the search business.

Reporter: I'm a bit intimidated by your user base, and by the end of 2012 you have more than 460 million users, basically to the number of Facebook users half, you think in the near future to see which areas fit to enter, to get more revenue?

Xu Zuori: In the near term, search business is one of our most valuable business, the Chinese search engine market size is about 5 billion U.S. dollars, most of which are obtained by Baidu, but we also come, even if we just take a part of this 5 billion dollars, for our companies of this size will be a big income, After all, we had only 329 million dollars last year, so we saw the search as a very important opportunity in the short term. Other more important areas are mobile internet, everyone is talking about the mobile end now, but we have a good layout now, we have China's largest mobile internet security products and the largest application store on the Android platform, these products and services will provide a solid foundation for our mobile end commercialization,

Reporter: Your mobile app was taken off the itunes store a couple of weeks ago, so how do you communicate with Apple? Will you not be able to reduce the development of iOS apps and more to Android apps in the future?

Xu Zuori: We've been working closely with Apple to find the solution, and we've made some progress but we haven't been able to get our apps back on itunes yet. From our perspective, we want to maintain the cooperation and friendly relationship with Apple, which is a strategy we will work on for a long time. But if you look at our mobile end users, 70% to 80% of users are Android users, which may also be the overall status of China Mobile (microblogging) Internet users. At present, from the point of view of commercialization of mobile end, our center of gravity is absolutely Android platform, but Apple is also the partner that we want to treat carefully, we want to treat the relationship with Apple cautiously.

Reporter: Internet security is your core business, there are many attacks on China, how do you think of this problem? How will your company stop these cyber hacking attacks? Do you think America's attack on China is fair?

Xu Zuori: Our products are for individual users, in other words, our internet security products are to protect Chinese mainland internet users from rogue programs, malicious links and other attacks, this is our main goal, we only develop personal user products, currently only available in Chinese version, So we're not very good at evaluating hacker cyber attacks you've mentioned. But we can be very proud to say that since we launched a free internet security product a few years ago, we have basically created a new market to help Chinese Internet users understand that they need a secure Internet environment that we have achieved over the past few years.

Reporter: The South China Morning Post released news this week that Sohu is considering delisting from Nasdaq, and I wonder if you have any plans for mergers and acquisitions?

Xu Zuori: There are a lot of companies in various segments of the internet in China, and I think mergers may be a way to expand the market quickly, and we're also examining the opportunities, but there are no suitable acquisitions. But if the opportunity is right and valuable, we will take action, but not now.