The healthcare advertisers we met with have prepared a budget for Qihoo equivalent to 15-25% of that for Baidu and all budgets are incremental.
We note that healthcare-related traffic is shifting towards mobile from PC faster than other categories, likely out of more privacy protection
consideration. Given Qihoo?s weak position on mobile search, it is negative to Qihoo in the long term.
Mobile games on the other hand is slowing faster than we expected, likely due to a weak pipeline and intense competition from Tencent and Baidu.
