Our Holding Company Structure and Contractual Arrangements with the VIE HUYA Inc. is not a Chinese operating company but a Cayman Islands holding company with no equity ownership in the VIE. We conduct our operations primarily through our subsidiaries and the VIE in mainland China. Laws and regulations of mainland China restrict and impose conditions on foreign direct investment in companies that engage in internet and other related businesses, including the provision of internet content. Therefore, we operate such business in mainland China through the variable interest entity, Guangzhou Huya Information Technology Co., Ltd., or Guangzhou Huya, which we may refer to as “the VIE” and “the variable interest entity” in this annual report, and rely on contractual arrangements among Guangzhou Huya Technology Co., Ltd., or Huya Technology, our subsidiary in mainland China, the VIE and its nominee shareholders to control the business operations of the VIE. The VIE is consolidated for accounting purposes, but is not an entity in which our Cayman Islands holding company, or our investors, own equity. Such structure enables investors to share economic interests in mainland China-based companies in sectors where foreign direct investment is prohibited or restricted under laws and regulations in mainland China. Revenues contributed by the VIE accounted for 95.6%, 94.1% and 91.6% of our total net revenues for the fiscal years 2023, 2024 and 2025, respectively. As used in this annual report, “we,” “us,” “our company,” “our” and “Huya” refer to HUYA Inc., a Cayman Islands company, and its subsidiaries, and, in the context of describing our operations and consolidated financial information, also include the VIE and its subsidiaries in mainland China. Investors in our ADSs are not purchasing equity interest in the VIE in mainland China but instead are purchasing equity interest in a Cayman Islands holding company and may never directly hold equity interest in the VIE in mainland China. A series of contractual agreements, including an equity interest pledge agreement, an exclusive business cooperation agreement, a shareholder voting rights proxy agreement and an exclusive option agreement, have been entered into by and among Huya Technology, the VIE and its shareholders. As a result of the contractual arrangements, we are the primary beneficiary of the VIE and its subsidiaries for accounting purposes, and HUYA Inc. has consolidated the financial results of operations, assets, and liabilities of these companies in its consolidated financial statements under U.S. GAAP. Neither HUYA Inc. nor its investors has an equity ownership (including foreign direct investment) in, or control through such equity ownership of, the VIE, and the contractual arrangements are not equivalent to an equity ownership in the business of the VIE. For more details of these contractual arrangements, see “Item 4. Information on the Company—C. Organizational Structure—Contractual Arrangements with Guangzhou Huya.” However, the contractual arrangements may not be as effective as direct ownership in providing us with control over the VIE and we may incur substantial costs to enforce the terms of the arrangements. As such, the VIE structure involves unique risks to investors of our Cayman Islands holding company. In addition, the legality and enforceability of the contractual agreements by and among Huya Technology, our subsidiary in mainland China, the VIE, and its nominee shareholders have not been tested in mainland China courts. See “Item 3. Key Information—D. Risk Factors—Risks Related to Our Corporate Structure—We rely on contractual arrangements with the variable interest entity and its shareholders for the operation of our business, which may not be as effective as direct ownership. If the variable interest entity and its shareholders fail to perform their obligations under these contractual arrangements, we may have to resort to litigation to enforce our rights, which may be time-consuming, unpredictable, expensive and damaging to our operations and reputation” and “Item 3. Key Information—D. Risk Factors—Risks Related to Our Corporate Structure—The shareholders of the VIE have potential conflicts of interest with us, and if any such conflicts of interest are not resolved in our favor, our business may be materially and adversely affected.” 3 Table of Contents There are also uncertainties regarding the interpretation and application of current and future laws, regulations and rules of mainland China regarding the status of the rights of our Cayman Islands holding company with respect to its contractual arrangements with the VIE and its shareholders. It is uncertain whether any new laws or regulations of mainland China relating to variable interest entity structures will be adopted or if adopted, what they would provide. If we or any of the VIE is found to be in violation of any existing or future laws or regulations of mainland China, or fail to obtain or maintain any of the required permits or approvals, the regulatory authorities of mainland China may exercise their discretion in accordance with the applicable laws and regulations in dealing with such violations or failures. See “Item 3. Key Information—D. Risk Factors—Risks Related to Our Corporate Structure—If the government of mainland China finds that the structure we have adopted for our business operations does not comply with laws and regulations of mainland China, or if these laws or regulations or interpretations of existing laws or regulations change in the future, we could be subject to penalties, including the shutting down of our platform and our business operations” and “Item 3. Key Information—D. Risk Factors—Risks Related to Our Corporate Structure—Uncertainties exist with respect to the interpretation and implementation of the PRC Foreign Investment Law and how it may impact the viability of our current corporate structure, corporate governance and business operations.” Our corporate structure is subject to risks associated with our contractual arrangements with the VIE. Investors may never directly hold equity interests in the VIE. If the government of mainland China finds that the agreements that establish the structure for operating our business do not comply with laws and regulations of mainland China, or if these regulations or their interpretations change in the future, we could be subject to penalties or be forced to relinquish our interests in those operations. Our holding company, our subsidiaries in mainland China, the VIE, and investors of our company face uncertainty about potential future actions by the government of mainland China that could affect the enforceability of the contractual arrangements with the VIE and, consequently, significantly affect the financial performance of the VIE and our company as a whole. The regulatory authorities of mainland China could disallow the VIE structure, which would likely result in a material adverse change in our operations and cause the value of our ADSs to significantly decline or become worthless. For a detailed description of the risks associated with our corporate structure, please refer to risks disclosed under “Item 3. Key Information—D. Risk Factors—Risks Related to Our Corporate Structure.” The Holding Foreign Companies Accountable Act Pursuant to the Holding Foreign Companies Accountable Act, or the HFCAA, if the SEC determines that we have filed audit reports issued by a registered public accounting firm that has not been subject to inspections by the Public Company Accounting Oversight Board, or the PCAOB, for two consecutive years, the SEC will prohibit our shares or the ADSs from being traded on a national securities exchange or in the over-the-counter trading market in the United States. On December 16, 2021, the PCAOB issued a report to notify the SEC of its determination that the PCAOB was unable to inspect or investigate completely registered public accounting firms headquartered in mainland China and Hong Kong, including our auditor. In May 2022, the SEC conclusively listed us as a Commission-Identified Issuer under the HFCAA following the filing of our annual report on Form 20-F for the fiscal year ended December 31, 2021. On December 15, 2022, the PCAOB issued a report that vacated its December 16, 2021 determination and removed mainland China and Hong Kong from the list of jurisdictions where it is unable to inspect or investigate completely registered public accounting firms. For this reason, we were not identified as a Commission-Identified Issuer under the HFCAA for the previous fiscal years and do not expect to be so identified after we file this annual report on Form 20-F. Each year, the PCAOB will determine whether it can inspect and investigate completely audit firms in mainland China and Hong Kong, among other jurisdictions. If PCAOB determines in the future that it no longer has full access to inspect and investigate completely accounting firms in mainland China and Hong Kong and we continue to use an accounting firm headquartered in one of these jurisdictions to issue an audit report on our financial statements filed with the SEC, we would be identified as a Commission-Identified Issuer following the filing of the annual report on Form 20-F for the relevant fiscal year. There can be no assurance that we would not be identified as a Commission-Identified Issuer for any future fiscal year, and if we were so identified for two consecutive years, we would become subject to the prohibition on trading under the HFCAA. For more details, see “Item 3. Key Information—D. Risk Factors—Risks Related to Doing Business in Mainland China—The PCAOB had historically been unable to inspect our auditor in relation to their audit work performed for our financial statements and the inability of the PCAOB to conduct inspections of our auditor in the past has deprived our investors with the benefits of such inspection” and “Item 3. Key Information—D. Risk Factors—Risks Related to Doing Business in Mainland China—Our ADSs may be prohibited from trading in the United States under the HFCAA in the future if the PCAOB is unable to inspect or investigate completely auditors located in China. The delisting of the ADSs, or the threat of their being delisted, may materially and adversely affect the value of your investment.” 4 Table of Contents Other Risks Related to Our Mainland China Operations We face various legal and operational risks and uncertainties associated with being based in or having the majority of our operations in mainland China and the complex and evolving laws and regulations of mainland China. For example, we face risks associated with recent statements and regulatory actions by mainland China’s government, such as those related to regulatory approvals on offerings conducted overseas by and foreign investment in mainland China-based issuers, the use of variable interest entities, anti-monopoly regulatory actions, and oversight on cybersecurity and data privacy, which may impact our ability to conduct certain businesses, accept foreign investments, or list on a United States or other foreign exchange. Specifically, these statements and regulatory actions require us to complete filing procedures for any future offshore offering or listing with the China Securities Regulatory Commission, to fulfill certain obligations as required under the cybersecurity laws and regulations of mainland China if we are deemed to be a critical information infrastructure operator defined thereunder, and to comply with the anti-monopoly and competitions laws. For details of these regulatory requirements and relevant risks, see “Item 3. Key Information—Permissions Required from the PRC Authorities for our Operations” and “Item 4. Information on the Company—B. Business Overview—Government Regulations.” We face risks and uncertainties as to whether we could address these regulatory requirements in a proper and timely manner, or at all. These risks and uncertainties could result in a material adverse change in our operations and the value of our ADSs, significantly limit or completely hinder our ability to continue to offer securities to investors, or cause the value of such securities to significantly decline or become worthless. For a detailed description of risks related to doing business in mainland China, please refer to risks disclosed under “Item 3. Key Information—D. Risk Factors—Risks Related to Doing Business in Mainland China.” Significant authority of government of mainland China in regulating our operations and its oversight and control over offerings conducted overseas by, and foreign investment in, mainland China-based issuers could significantly limit or completely hinder our ability to offer or continue to offer securities to investors. Implementation of industry-wide regulations in this nature, such as data security or anti-monopoly related regulations, may cause the value of such securities to significantly decline or become worthless. For more details, see “Item 3. Key Information—D. Risk Factors—Risks Related to Doing Business in Mainland China—The significant oversight and discretion of the government of mainland China over our business operation could result in a material adverse change in our operations and the value of our ADSs.” Risks and uncertainties arising from the legal system in mainland China, including risks and uncertainties regarding the enforcement of laws and evolving rules and regulations in mainland China, could result in a material adverse change in our operations and the value of our ADSs. For more details, see “Item 3. Key Information—D. Risk Factors—Risks Related to Doing Business in Mainland China—Uncertainties with respect to the legal system of mainland China and the interpretation and enforcement of laws and regulations of mainland China may affect the legal protections available to you and us.” Permissions Required from the PRC Authorities for Our Operations We conduct our business primarily through our subsidiaries and the VIE in mainland China. Our operations in mainland China are governed by laws and regulations of mainland China. As of the date of this annual report, our subsidiaries in mainland China, the VIE and its subsidiaries have obtained the requisite licenses and permits from the government authorities of mainland China that are necessary for our business operations in mainland China, including, among others, a value-added telecommunications business operation license for information services via internet, or ICP License, a permit for internet audio-video program service, a radio and television program production and operating permit, a commercial performance license and an internet culture operation license for music entertainment products, animation products, and online performance. Given the uncertainties of interpretation and implementation of laws and regulations and the enforcement practice by government authorities of mainland China, we may be required to obtain additional licenses, permits, filings or approvals for the functions and services of our platform in the future. For more detailed information, see “Item 3. Key Information—D. Risk Factors—Risks Related to Our Business and Industry—If we fail to obtain and maintain the licenses and approvals required under the complex regulatory environment for internet-based businesses in mainland China, our business, financial condition and results of operations may be materially and adversely affected.” 5 Table of Contents Under applicable laws of mainland China, we, our subsidiaries in mainland China and the VIE may be required to complete certain filing procedures with the China Securities Regulatory Commission in connection with future offering and listing in an overseas market, including our follow-on offerings, issuance of convertible bonds, offshore relisting after going-private transactions, and other equivalent offering activities. If we fail to complete such filing procedures for any future offshore offering or listing, including our follow-on offerings, issuance of convertible bonds, offshore relisting after going-private transactions, and other equivalent offering activities, we may face sanctions by the China Securities Regulatory Commission or other regulatory authorities of mainland China, which may include fines and penalties on our operations in mainland China, limitations on our operating privileges in mainland China, restrictions on or delays to our future financing transactions offshore, or other actions that could have a material and adverse effect on our business, financial condition, results of operations, reputation and prospects, as well as the trading price of our ADSs. In addition, we are required to file a report to the China Securities Regulatory Commission after the occurrence and public disclosure of certain material corporate events, including but not limited to, change of control and voluntary or mandatory delisting. In connection with our previous issuance of securities to foreign investors, as of the date of this annual report, we, our subsidiaries in mainland China and the VIE (i) have not been required to obtain permissions from the China Securities Regulatory Commission, (ii) have not been required to go through cybersecurity review by the Cyberspace Administration of China, and (iii) have not been asked to obtain or were denied such permissions by any authority of mainland China. However, the government of mainland China has indicated an intent to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in mainland China-based issuers. For more detailed information, see “Item 3. Key Information—D. Risk Factors—Risks Related to Doing Business in Mainland China—The approval of and filing with the China Securities Regulatory Commission or other government authorities in mainland China may be required in connection with our future offshore offerings and capital raising activities under law of mainland China, and, if required, we cannot predict whether or for how long we will be able to obtain such approval or complete such filing.” Furthermore, if we are deemed to be a critical information infrastructure operator under the cybersecurity laws and regulations of mainland China, we must fulfill certain obligations as required under the cybersecurity laws and regulations of mainland China including, among others, storing personal information and important data collected and produced within the territory of mainland China during our operations in mainland China, and we may be subject to review when purchasing internet products and services. If we are not able to comply with the cybersecurity and data privacy requirements in a timely manner, or at all, we may be subject to government enforcement actions and investigations, fines, penalties, suspension of our non-compliant operations, or removal of our apps from application stores, among other sanctions, which could materially and adversely affect our business and results of operations. For more detailed information, see “Item 3. Key Information—D. Risk Factors—Risks Related to Our Business and Our Industry—Our business generates and processes a large amount of data, and we are required to comply with laws of mainland China and other applicable laws relating to privacy and cybersecurity. The improper use or disclosure of data could have a material and adverse effect on our business and prospects.” and “Item 4. Information on the Company—B. Business Overview—Government Regulations.” Cash Flows through Our Organization HUYA Inc. is a holding company with no operations of its own. We conduct our operations in mainland China primarily through our subsidiaries and the VIE in mainland China. As a result, although other means are available for us to obtain financing at the holding company level, HUYA Inc.’s ability to pay dividends to the shareholders and to service any debt it may incur may depend upon dividends paid by our subsidiaries in mainland China and service fees paid by the VIE. If any of our subsidiaries incurs debt on its own behalf in the future, the instruments governing such debt may restrict its ability to pay dividends to HUYA Inc. In addition, our subsidiaries in mainland China are permitted to pay dividends to HUYA Inc. only out of their retained earnings, if any, as determined in accordance with accounting standards and regulations of mainland China. Furthermore, our subsidiaries in mainland China and the VIE are required to make appropriations to certain statutory reserve funds or may make appropriations to certain discretionary funds, which are not distributable as cash dividends and can only be used for specific purposes. For more details, see “Item 5. Operating and Financial Review and Prospects—B. Liquidity and Capital Resources—Holding Company Structure.” Under laws and regulations of mainland China, our subsidiaries in mainland China and the VIE are subject to certain restrictions with respect to paying dividends or otherwise transferring any of their net assets to us. The VIE cannot pay dividends to us as we do not own any equity interest in the VIE. Remittance of dividends by a wholly foreign-owned enterprise out of mainland China is also subject to examination by the banks designated by the State Administration of Foreign Exchange. The amounts restricted include the paid-up capital and the statutory reserve funds of our subsidiaries in mainland China and the net assets of the VIE in which we have no legal ownership. For risks relating to the fund flows of our operations in mainland China, see “Item 3. Key Information—D. Risk Factors—Risks Related to Our Corporate Structure—Our subsidiaries in mainland China and the variable interest entity are subject to restrictions on paying dividends or making other payments to us, which may restrict our ability to satisfy our liquidity requirements.” 6 Table of Contents Under law of mainland China, HUYA Inc. and its offshore subsidiaries may provide funding to our subsidiaries in mainland China only through capital contributions or loans, including advances, and to the VIE only through loans, including advances, subject to satisfaction of applicable government registration and approval requirements. HUYA Inc. and its offshore subsidiaries extended capital contributions of nil, nil and nil in the years ended December 31, 2023, 2024 and 2025, respectively, and advances in the amount of RMB51.0 million, RMB37.6 million and nil as of December 31, 2023, 2024 and 2025, respectively, to our subsidiaries in mainland China. Our company has established a centralized cash management policy to direct how funds are transferred between HUYA Inc., its subsidiaries and the VIE to improve the efficiency and ensure the security of cash management. Our centralized cash management policy consists of a series of manuals and procedures on fund management, bank accounts management, financing activities and safe handling of cash and assets, which apply to all of our subsidiaries and VIE and its subsidiaries. The cash of our company is centrally managed by our finance department and is deployed and applied to each operating entity based on the budget and operating conditions of the specific operating entity. Based on the specific amount of each transfer of funds and the use of funds, requisite internal approval from our finance department must be obtained prior to each funds transfer. The finance department will only allocate the cash to the operating entity after the application for cash requirement is approved by the responsible person in the finance department. Furthermore, the funds will be transferred in accordance with the applicable PRC laws and regulations, either through our cash pooling structure, intercompany loans, and deposits or entrusted loans, depending on the circumstances and taking the regulatory and taxation requirements into consideration. For more information relating to fund flows through our organization, see “Item 3. Key Information—Financial Information Related to the VIE (and VIE’s Subsidiaries)” and Note 1(d) to our audited consolidated financial statements included elsewhere in this annual report. The VIE may transfer cash to our subsidiaries in mainland China by paying service fees according to the exclusive business cooperation agreement. Pursuant to this agreement, the VIE agrees to pay our subsidiaries in mainland China fees for technology support, business support and consulting services, subject to conditions therein. In the years ended December 31, 2023, 2024 and 2025, the VIE settled a total amount of RMB5,530.3 million, RMB4,622.5 million and RMB4,782.8 million (US$683.9 million), respectively, for services provided by our subsidiaries. Our subsidiaries in mainland China have the right to determine the service fee to be charged to the VIE under this agreement by considering, among other things, the technical difficulty and the complexity of the services, the time needed for providing such services and the specific content and business value of the services. The term of this agreement is ten years, commencing on September 17, 2020, and will be automatically renewed for an additional ten-year period provided there is no objection from our subsidiaries in mainland China. In the future, to the extent there is any fee owed to our subsidiaries in mainland China under this agreement, the VIE intends to settle it. Neither our subsidiaries nor the VIE made cash dividends or other distributions to HUYA Inc., the holding company, or its offshore subsidiaries, in the years ended December 31, 2023, 2024 and 2025. Going forward, our subsidiaries and the VIE intend to retain most, if not all, of their available funds and any future earnings. We declared a special cash dividend on March 19, 2024 of US$0.66 per ordinary share, or US$0.66 per ADS, to holders of ordinary shares and holders of ADSs of record as of the close of business on May 10, 2024, and distributed such dividend in May 2024 in a total amount of approximately US$150 million. In addition, we declared a special cash dividend on August 13, 2024 of US$1.08 per ordinary share, or US$1.08 per ADS, to holders of ordinary shares and holders of ADSs of record as of the close of business on October 9, 2024, and distributed such dividend in October 2024 in a total amount of approximately US$250 million. In March 2025, our board approved a cash dividend plan for the years 2025, 2026, and 2027 (the “2025-2027 Dividend Plan”) for the purpose of enhancing shareholder returns and optimizing our capital structure. The 2025-2027 Dividend Plan consists of a special cash dividend paid in 2025 (the “2025 Cash Dividend”), a special cash dividend to be paid in 2026 (the “2026 Cash Dividend”) and a cash dividend currently expected to be paid in 2027 (the “Expected 2027 Dividend”). We distributed the 2025 Cash Dividend to the holders of our ordinary shares and holders of our ADSs in June 2025. The total amount of the 2025 Cash Dividend was approximately US$340 million, which was funded by surplus cash on our balance sheet. In addition, our board approved the 2026 Cash Dividend in March 2026, which will be paid to the holders of our ordinary shares and holders of our ADSs as of the close of business on June 17, 2026, in U.S. dollars, in an amount of US$0.135 per ordinary share or US$0.135 per ADS. The total amount of cash to be distributed for the 2026 Cash Dividend is expected to be approximately US$31 million, which will be funded by surplus cash on our balance sheet. The aggregate amount of the Expected 2027 Dividend is expected to be no less than US$30 million. With respect to the Expected 2027 Dividend, our board reserves full discretion relating to the determination to make such dividend distribution and the amount, timing, and other specifics of such distribution. The dividends to be paid under the 2025-2027 Dividend Plan to our ADS holders through the depositary bank will be subject to the terms of the deposit agreement. For mainland China and U.S. federal income tax considerations of an investment in our ADSs and/or ordinary shares, see “Item 10. Additional Information—E. Taxation.” 7 Table of Contents For purposes of illustration, the following discussion reflects the hypothetical taxes that might be required to be paid within China, assuming that: (i) we have taxable earnings, (ii) we determine to pay dividends in the future, and (iii) all profits of the VIE and the VIE’s subsidiaries will be distributed as fees to our subsidiaries in mainland China under tax neutral contractual arrangements. ​ ​ ​ ​ ​ ​ ​ ​ Tax calculation(1) Hypothetical pre-tax earnings(2) 100.00 % Tax on earnings at statutory rate of 25%(3) ​ (25.00) % Net earnings available for distribution 75.00 % Withholding tax at standard rate of 10%(4) ​ (7.50) % Net distribution to Parent/Shareholders 67.50 % ​ If, in the future, the accumulated earnings of the VIE exceed the service fees paid to our subsidiaries in mainland China (or if the current and contemplated fee structure between the intercompany entities is determined to be non-substantive and disallowed by Chinese tax authorities), the VIE and the VIE’s subsidiaries could make a non-deductible transfer to our subsidiaries in mainland China for the amounts of the stranded cash in the VIE. This would result in such transfer being non-deductible expenses for the VIE and the VIE’s subsidiaries but still taxable income for the subsidiaries in mainland China. Such a transfer and the related tax burdens would reduce our after-tax income to approximately 50.6% of the pre-tax income. Our management believes that there is only a remote possibility that this scenario would happen. Notes: (1) For purposes of this example, the tax calculation has been simplified. The hypothetical book pre-tax earnings amount, not considering timing differences, is assumed to equal taxable income in mainland China. (2) Under the terms of our contractual arrangements with the VIE, our subsidiaries in mainland China may charge the VIE and the VIE’s subsidiaries for services provided to the VIE and the VIE’s subsidiaries. These service fees shall be recognized as expenses of the VIE and the VIE’s subsidiaries, with a corresponding amount as service income by our subsidiaries in mainland China and eliminate in consolidation. For income tax purposes, our subsidiaries in mainland China and the VIE and the VIE’s subsidiaries file income tax returns on a separate company basis. The service fees paid are recognized as a tax deduction by the VIE and the VIE’s subsidiaries and as income by our mainland China subsidiaries and are tax neutral. (3) Certain of our subsidiaries and the VIE qualifies for a 15% preferential income tax rate in mainland China. However, such rate is subject to qualification, is temporary in nature, and may not be available in a future period when distributions are paid. For purposes of this hypothetical example, the table above reflects a maximum tax scenario under which the full statutory rate would be effective. (4) The PRC Enterprise Income Tax Law imposes a withholding income tax of 10% on dividends distributed by a foreign invested enterprise to its immediate holding company outside of mainland China. A lower withholding income tax rate of 5% is applied if the immediate holding company of a foreign invested enterprise is registered in Hong Kong or other jurisdictions that have a tax treaty arrangement with mainland China, subject to a qualification review at the time of the distribution. For purposes of this hypothetical example, the table above assumes a maximum tax scenario under which the full withholding tax would be applied. Under the current laws of the Cayman Islands, HUYA Inc. is not subject to tax on income or capital gains. Upon payments of dividends to our shareholders, no Cayman Islands withholding tax will be imposed. A.[Reserved] Financial Information Related to the VIE (and VIE’s Subsidiaries) The following tables related to the VIE and the VIE’s subsidiaries and other entities present the condensed consolidating schedules of financial information of HUYA Inc., its subsidiary that is the primary beneficiary of the VIE, its other subsidiaries and the VIE and its subsidiaries for the years and as of the dates indicated. 8 Table of Contents Selected Condensed Consolidating Statements of Operation Data ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, 2025 ​ ​ ​ ​ Other ​ Primary ​ VIE and ​ Eliminating ​ Consolidated ​ ​ ​ ​ HUYA Inc. ​ ​ ​ subsidiaries ​ ​ ​ beneficiary of VIE ​ ​ ​ VIE’s subsidiaries ​ ​ ​ adjustments ​ ​ ​ Totals ​ ​ (RMB in thousands) Third-party revenues ​ — ​ 411,050 ​ 133,780 ​ 5,957,570 ​ — ​ 6,502,400 Inter-company revenues(1) — ​ 9,894 ​ 4,783,206 ​ 19,540 ​ (4,812,640) ​ — Total cost and expenses(2) 3,795 ​ (409,479) ​ (5,146,617) ​ (5,963,899) ​ 4,813,814 ​ (6,702,386) Share of loss of subsidiaries, VIE and VIE’s subsidiaries(3) (111,468) ​ (236,537) ​ (93,603) ​ — ​ 441,608 ​ — Others, net 804 ​ 120,388 ​ 86,698 ​ (103,820) ​ (1,174) ​ 102,896 Loss before income tax (106,869) ​ (104,684) ​ (236,536) ​ (90,609) ​ 441,608 ​ (97,090) Income tax expenses (5,722) ​ (6,784) ​ (1) ​ (299) ​ — ​ (12,806) Share of loss from equity method investments — ​ — ​ — ​ (2,695) ​ — ​ (2,695) Net loss (112,591) ​ (111,468) ​ (236,537) ​ (93,603) ​ 441,608 ​ (112,591) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, 2024 ​ ​ ​ ​ Other ​ Primary ​ VIE and ​ Eliminating ​ Consolidated ​ ​ ​ ​ HUYA Inc. ​ ​ ​ subsidiaries ​ ​ ​ beneficiary of VIE ​ ​ ​ VIE’s subsidiaries ​ ​ ​ adjustments ​ ​ ​ Totals ​ ​ (RMB in thousands) Third-party revenues ​ ​ ​ — ​ 349,593 ​ 10,163 ​ 5,719,359 ​ — ​ 6,079,115 Inter-company revenues(1) — 8,145 4,642,018 6,196 (4,656,359) — Total cost and expenses(2) (6,720) (367,111) (4,863,336) (5,732,001) 4,657,981 (6,311,187) Share of loss of subsidiaries, VIE and VIE’s subsidiaries(3) (92,013) (213,602) (104,374) — 409,989 — Others, net 54,197 140,644 102,073 (97,675) (1,622) 197,617 Loss before income tax (44,536) (82,331) (213,456) (104,121) 409,989 (34,455) Income tax expenses (3,419) ​ (9,682) ​ (146) ​ (253) ​ — ​ (13,500) Net loss (47,955) ​ (92,013) ​ (213,602) ​ (104,374) ​ 409,989 ​ (47,955) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, 2023 ​ ​ ​ ​ Other ​ Primary ​ VIE and ​ Eliminating ​ Consolidated ​ ​ ​ ​ HUYA Inc. ​ ​ ​ subsidiaries ​ ​ ​ beneficiary of VIE ​ ​ ​ VIE’s subsidiaries ​ ​ ​ adjustments ​ ​ ​ Totals ​ ​ (RMB in thousands) Third-party revenues ​ ​ ​ — ​ 306,969 ​ 1,326 ​ 6,686,033 ​ — ​ 6,994,328 Inter-company revenues(1) — ​ 16,650 ​ 5,534,256 ​ — ​ (5,550,906) ​ — Total cost and expenses(2) (16,707) ​ (403,456) ​ (5,903,519) ​ (6,746,390) ​ 5,550,894 ​ (7,519,178) Share of loss of subsidiaries, VIE and VIE’s subsidiaries(3) (289,783) ​ (382,321) ​ (154,982) ​ — ​ 827,086 ​ — Others, net 109,030 ​ 178,888 ​ 140,598 ​ (94,625) ​ (345) ​ 333,546 Loss before income tax (197,460) ​ (283,270) ​ (382,321) ​ (154,982) ​ 826,729 ​ (191,304) Income tax expenses (6,702) ​ (6,513) ​ — ​ — ​ — ​ (13,215) Net loss (204,162) ​ (289,783) ​ (382,321) ​ (154,982) ​ 826,729 ​ (204,519) Notes: ​ (1) It represents the elimination of the inter-company service fees for technology support, business support and consulting fees (collectively defined as “VIE service fees”) that are charged pursuant to the exclusive business cooperation agreement. ​ 9 Table of Contents (2) For the years ended December 31, 2023, 2024 and 2025, VIE service fees were charged by the primary beneficiary of the VIE and other subsidiaries to the VIE and VIE’s subsidiaries amounting to RMB5,530.3 million, RMB4,622.5 million and RMB4,782.8 million, respectively. These inter-company charges were eliminated in consolidation. (3) It represents the elimination of the investments in the VIE, the VIE’s subsidiaries, the primary beneficiary of the VIE and other subsidiaries by HUYA Inc. Selected Condensed Consolidating Balance Sheets Data ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, 2025 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Primary ​ ​ ​ VIE and ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other ​ beneficiary ​ VIE’s ​ Eliminating ​ Consolidated ​ ​ ​ ​ HUYA Inc. ​ ​ ​ subsidiaries ​ ​ ​ of VIE ​ ​ ​ subsidiaries ​ ​ ​ adjustments ​ ​ ​ Totals ​ ​ (RMB in thousands) Assets ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ 1,511 ​ 181,985 ​ 505,353 ​ 3,814 ​ — ​ 692,663 Restricted cash 1,666 ​ — ​ — ​ 10,365 ​ — ​ 12,031 Short-term deposits — ​ 1,405,760 ​ 1,610,000 ​ 110,000 ​ — ​ 3,125,760 Accounts receivable, net — ​ 62,473 ​ 54,848 ​ 121,248 ​ — ​ 238,569 Prepayments and other current assets, net 2,915 ​ 77,769 ​ 194,368 ​ 272,026 ​ — ​ 547,078 Amounts due from related parties, net ​ — ​ 24,232 ​ 5,151 ​ 261,364 ​ — ​ 290,747 Amounts due from Group companies, net (1) 2,740,940 ​ — ​ 401,911 ​ 844,155 ​ (3,987,006) ​ — Investments — ​ 31,132 ​ — ​ 265,033 ​ — ​ 296,165 Long-term deposits — ​ — ​ — ​ — ​ — ​ — Investment in subsidiaries, VIE and VIE’s subsidiaries(2) 2,312,249 ​ 2,526,153 ​ 1,190,235 ​ — ​ (6,028,637) ​ — Intangible assets, net — ​ 81,110 ​ 1,420 ​ 45,103 ​ — ​ 127,633 Right of use asset — ​ 283,286 ​ 14,194 ​ 6,537 ​ — ​ 304,017 Other assets — ​ 569,327 ​ 41,453 ​ 2,679 ​ (248) ​ 613,211 Goodwill ​ — ​ 453,498 ​ — ​ — ​ — ​ 453,498 Total assets 5,059,281 ​ 5,696,725 ​ 4,018,933 ​ 1,942,324 ​ (10,015,891) ​ 6,701,372 Advances from customers and deferred revenue — ​ 9,045 ​ — ​ 250,946 ​ — ​ 259,991 Amounts due to Group companies(1) 120,467 ​ 3,205,384 ​ 661,155 ​ — ​ (3,987,006) ​ — Accrued liabilities and other current liabilities 17,004 ​ 106,217 ​ 562,085 ​ 347,131 ​ — ​ 1,032,437 Amount due to related parties — ​ 9,620 ​ 10,674 ​ 129,872 ​ — ​ 150,166 Other liabilities 1,846 ​ 54,210 ​ 258,866 ​ 24,140 ​ — ​ 339,062 Total liabilities 139,317 ​ 3,384,476 ​ 1,492,780 ​ 752,089 ​ (3,987,006) ​ 1,781,656 Total shareholders’ equity(2) 4,919,964 ​ 2,312,249 ​ 2,526,153 ​ 1,190,235 ​ (6,028,885) ​ 4,919,716 ​ 10 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Primary ​ ​ ​ VIE and ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other ​ beneficiary ​ VIE’s ​ Eliminating ​ Consolidated ​ ​ ​ ​ HUYA Inc. ​ ​ ​ subsidiaries ​ ​ ​ of VIE ​ ​ ​ subsidiaries ​ ​ ​ adjustments ​ ​ ​ Totals ​ ​ (RMB in thousands) Assets ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents 9,723 ​ 866,372 ​ 301,076 ​ 11,740 ​ — ​ 1,188,911 Restricted cash — ​ — ​ 1,140 ​ 15,891 ​ — ​ 17,031 Short-term deposits — ​ 2,940,048 ​ 705,000 ​ 430,000 ​ — ​ 4,075,048 Accounts receivable, net — ​ 29,902 ​ 597 ​ 45,545 ​ — ​ 76,044 Prepayments and other current assets, net 1,446 ​ 119,829 ​ 113,983 ​ 288,416 ​ — ​ 523,674 Amounts due from related parties, net — ​ 4,564 ​ 4,886 ​ 198,115 ​ — ​ 207,565 Amounts due from Group companies, net (1) 5,213,715 ​ — ​ 120,977 ​ 724,076 ​ (6,058,768) ​ — Investments — ​ 31,838 ​ — ​ 408,952 ​ — ​ 440,790 Long-term deposits ​ — ​ — ​ 1,410,000 ​ 60,000 ​ — ​ 1,470,000 Investment in subsidiaries, VIE and VIE’s subsidiaries(2) 2,378,739 ​ 2,734,833 ​ 1,317,199 ​ — ​ (6,430,771) ​ — Intangible assets, net — ​ 106,219 ​ 1,926 ​ 45,045 ​ — ​ 153,190 Right of use asset — ​ 293,786 ​ 31,755 ​ 13,951 ​ — ​ 339,492 Other assets — ​ 417,185 ​ 193,028 ​ 2,440 ​ (383) ​ 612,270 Goodwill ​ — ​ 463,796 ​ — ​ — ​ — ​ 463,796 Total assets 7,603,623 ​ 8,008,372 ​ 4,201,567 ​ 2,244,171 ​ (12,489,922) ​ 9,567,811 Advances from customers and deferred revenue — ​ 13,249 ​ — ​ 288,165 ​ — ​ 301,414 Amounts due to Group companies(1) ​ 36,544 ​ 5,426,145 ​ 596,079 ​ — ​ (6,058,768) ​ — Accrued liabilities and other current liabilities 15,523 ​ 124,745 ​ 798,451 ​ 422,230 ​ — ​ 1,360,949 Amount due to related parties — ​ 9,394 ​ 17,966 ​ 134,169 ​ — ​ 161,529 Other liabilities 494 ​ 56,100 ​ 54,238 ​ 82,408 ​ — ​ 193,240 Total liabilities 52,561 ​ 5,629,633 ​ 1,466,734 ​ 926,972 ​ (6,058,768) ​ 2,017,132 Total shareholders’ equity(2) 7,551,062 ​ 2,378,739 ​ 2,734,833 ​ 1,317,199 ​ (6,431,154) ​ 7,550,679 Notes: (1) It represents the elimination of inter-company balances among HUYA Inc., the VIE and the VIE’s subsidiaries, and other subsidiaries. As of December 31, 2024 and 2025, the outstanding balance of amounts due from/to Group companies related to inter-company advances. There were no outstanding balances at the balance sheet date related to VIE service fees charged to the VIE and the VIE’s subsidiaries. (2) It represents the elimination of the investments in the VIE, the VIE’s subsidiaries, the primary beneficiary of the VIE and other subsidiaries by HUYA Inc. 11 Table of Contents Selected Condensed Consolidating Cash Flows Data ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, 2025 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Primary ​ ​ ​ VIE and ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other ​ beneficiary ​ VIE’s ​ Eliminating ​ Consolidated ​ ​ ​ ​ HUYA Inc. ​ ​ ​ subsidiaries ​ ​ ​ of VIE ​ ​ ​ subsidiaries ​ ​ ​ adjustments ​ ​ ​ Totals ​ (RMB in thousands) Net cash provided by/(used in) operating activities(1) ​ 18,726 ​ 148,815 ​ 8,576 ​ (352,269) ​ — ​ (176,152) Repayment of advances received from Group companies: 2,473,167 ​ — ​ (197,451) ​ — ​ (2,275,716) ​ — Other investing activities — ​ 1,344,473 ​ 501,988 ​ 338,817 ​ — ​ 2,185,278 Net cash provided by/(used in) investing activities 2,473,167 ​ 1,344,473 ​ 304,537 ​ 338,817 ​ (2,275,716) ​ 2,185,278 Repayment of advances to Group companies: — ​ (2,165,740) ​ (109,976) ​ — ​ 2,275,716 ​ — Other financing activities (2,498,192) ​ — ​ — ​ — ​ — ​ (2,498,192) Net cash (used in)/provided by financing activities (2,498,192) ​ (2,165,740) ​ (109,976) ​ — ​ 2,275,716 ​ (2,498,192) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Primary ​ ​ ​ VIE and ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other ​ beneficiary ​ VIE’s ​ Eliminating ​ Consolidated ​ ​ ​ ​ HUYA Inc. ​ ​ ​ subsidiaries ​ ​ ​ of VIE ​ ​ ​ subsidiaries ​ ​ ​ adjustments ​ ​ ​ Totals ​ ​ (RMB in thousands) Net cash provided by/(used in) operating activities(1) ​ 151,016 ​ 374,861 ​ (456,196) ​ 24,602 ​ — ​ 94,283 Repayment of advances received from Group companies: 796,333 ​ — ​ 55,887 ​ — ​ (852,220) ​ — Other investing activities 2,067,219 ​ 1,065,082 ​ 569,072 ​ (22,838) ​ — ​ 3,678,535 Net cash provided by/(used in) investing activities 2,863,552 ​ 1,065,082 ​ 624,959 ​ (22,838) ​ (852,220) ​ 3,678,535 Repayment of advances to Group companies: — ​ (852,220) ​ — ​ — ​ 852,220 ​ — Other financing activities (3,104,671) ​ — ​ — ​ — ​ — ​ (3,104,671) Net cash (used in)/provided by financing activities (3,104,671) ​ (852,220) ​ — ​ — ​ 852,220 ​ (3,104,671) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Primary ​ ​ ​ VIE and ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other ​ beneficiary ​ VIE’s ​ Eliminating ​ Consolidated ​ ​ ​ ​ HUYA Inc. ​ ​ ​ subsidiaries ​ ​ ​ of VIE ​ ​ ​ subsidiaries ​ ​ ​ adjustments ​ ​ ​ Totals ​ ​ (RMB in thousands) Net cash provided by/(used in) operating activities(1) ​ 33,061 ​ 123,828 ​ (245,791) ​ 56,821 ​ — ​ (32,081) Repayments/(payments) of advances from Group companies 1,122,769 ​ — ​ (78,852) ​ — ​ (1,043,917) ​ — Other investing activities (881,852) ​ 742,658 ​ 241,663 ​ (49,263) ​ — ​ 53,206 Net cash provided by/(used in) investing activities 240,917 ​ 742,658 ​ 162,811 ​ (49,263) ​ (1,043,917) ​ 53,206 Repayments of advances to Group companies — ​ (1,043,917) ​ — ​ — ​ 1,043,917 ​ — Other financing activities (202,294) ​ — ​ — ​ — ​ — ​ (202,294) Net cash (used in)/provided by financing activities (202,294) ​ (1,043,917) ​ — ​ — ​ 1,043,917 ​ (202,294) Notes: (1) For the years ended December 31, 2023, 2024 and 2025, cash paid by the VIE and the VIE’s subsidiaries to the primary beneficiary of the VIE and other subsidiaries for VIE service fees were RMB5,391.5 million, RMB4,410.4 million and RMB4,782.8. million, respectively. 12 Table of Contents B.Capitalization and Indebtedness Not Applicable. C.Reasons for the Offer and Use of Proceeds Not Applicable. D.Risk Factors Summary of Risk Factors An investment in our ADSs involves significant risks. Below is a summary of material risks we face, organized under relevant headings. These risks are discussed more fully following this summary. Risks Related to Our Business and Our Industry ● If we fail to keep our existing users highly engaged, to further expand our user reach, or to effectively monetize our user base, our business, profitability and prospects may be adversely affected; ● We may fail to attract and retain talented and popular broadcasters; ● We may fail to offer attractive content, in particular popular game content, on our platform; ● We are undertaking a strategic transformation to expand our presence in the game industry. We cannot assure you that the transformation will succeed or achieve anticipated effect, and our results of operations may be materially and adversely affected as a result; ● We face competition in several major aspects of our business. If we fail to compete effectively, our business, results of operations and financial condition may be negatively impacted; ● Intensified government regulations, rules or guidelines of the internet industry in mainland China could restrict our ability to maintain or increase the level of user traffic to, and user spending on, our platform as well as our ability to tap into other market opportunities, and negatively impact our businesses, results of operations, or financial condition; ● If we fail to obtain and maintain the licenses and approvals required under the complex regulatory environment for internet-based businesses in mainland China, our business, financial condition and results of operations may be materially and adversely affected; ● We cooperate with various talent agencies to manage and recruit our broadcasters. If we are not able to maintain our relationship with talent agencies, in particular the platinum talent agencies which possess the capacity to produce a large volume of high-quality content and manage a considerable pool of talent, our operations may be materially and adversely affected; ● Significant revenue sharing fees and content costs on our platform have had and may continue to have an adverse effect on our business, financial condition and results of operations; ● We are subject to risks associated with operating in a rapidly changing industry and a relatively new market; ● We have made investments in applications of AI technologies and other technological advancements, and may face uncertainties with respect to their commercialization and the evolving laws and regulations applicable to us; ● Our revenue model for live streaming may not remain effective and we cannot guarantee that our future monetization strategies will be successfully implemented or generate sustainable revenues and profit; and 13 Table of Contents ● Changes in international trade policies and rising political tensions, particularly between the U.S. and China, may adversely impact our business and operating results. Risks Related to Our Relationship with Our Controlling Shareholder ● Our controlling shareholder will control the outcome of shareholder actions in our company; ● We may have conflicts of interest with Tencent and, because of Tencent’s controlling ownership interest in our company, we may not be able to resolve such conflicts on favorable terms for us; ● If we are no longer able to benefit from our business cooperation with Tencent, our business may be adversely affected; and ● Any negative development in Tencent’s market position and reputation, brand recognition and financial condition may materially and adversely affect our user base and brand image. Risks Related to Our Corporate Structure ● We are a Cayman Islands holding company with no equity ownership in the VIE and we conduct operations in mainland China primarily through (i) our subsidiaries in mainland China and (ii) the VIE, with which we have maintained contractual arrangements, and its subsidiaries. Investors in our ADSs thus are not purchasing equity interest in the VIE in mainland China but instead are purchasing equity interest in a Cayman Islands holding company. If the government of mainland China finds that the structure we have adopted for our business operations does not comply with laws and regulations of mainland China, or if these laws or regulations or interpretations of existing laws or regulations change in the future, we could be subject to penalties, including the shutting down of our platform and our business operations. Our holding company in the Cayman Islands, the VIE, and investors of our company face uncertainty about potential future actions by the government of mainland China that could affect the enforceability of the contractual arrangements with the VIE and, consequently, significantly affect the financial performance of the VIE and our company as a whole. The regulatory authorities of mainland China could disallow the VIE structure, which would likely result in a material adverse change in our operations, and our ADSs may decline significantly in value; ● We rely on contractual arrangements with the variable interest entity and its shareholders for the operation of our business, which may not be as effective as direct ownership. If the variable interest entity and its shareholders fail to perform their obligations under these contractual arrangements, we may have to resort to litigation to enforce our rights, which may be time-consuming, unpredictable, expensive and damaging to our operations and reputation; and ● The shareholders of the VIE have potential conflicts of interest with us, and if any such conflicts of interest are not resolved in our favor, our business may be materially and adversely affected. Risks Related to Doing Business in Mainland China ● The PCAOB had historically been unable to inspect our auditor in relation to their audit work performed for our financial statements and the inability of the PCAOB to conduct inspections of our auditor in the past has deprived our investors with the benefits of such inspections; ● Our ADSs may be prohibited from trading in the United States under the HFCAA in the future if the PCAOB is unable to inspect or investigate completely auditors located in mainland China. The delisting of the ADSs, or the threat of their being delisted, may materially and adversely affect the value of your investment; 14 Table of Contents ● Our mainland China operations are governed by PRC laws and regulations. The PRC government may have certain oversight and discretion over the conduct of our business, and may regulate or influence our operations to advance regulatory and societal goals and policy positions, which could result in a material adverse change in our operations and the value of our ADSs. For more details, see “Item 3. Key Information—D. Risk Factors—Risks Related to Doing Business in Mainland China—The significant oversight and discretion of the government of mainland China over our business operation could result in a material adverse change in our operations and the value of our ADSs;” ● Compliance with the laws or regulations governing virtual currency may result in us having to obtain additional approvals or licenses or change our current business model. For more details, see “Item 3. Key Information—D. Risk Factors—Risks Related to Doing Business in Mainland China—Compliance with the laws or regulations governing virtual currency may result in us having to obtain additional approvals or licenses or change our current business model;” ● Changes in the economic, political or social conditions or government policies in mainland China could have a material adverse effect on our business and operations. For more details, see “Item 3. Key Information—D. Risk Factors—Risks Related to Doing Business in Mainland China—Changes in the economic, political or social conditions or government policies in mainland China could have a material adverse effect on our business and operations;” ● Uncertainties with respect to the legal system of mainland China may adversely affect us. Since the interpretation and enforcement of certain laws and regulations may involve uncertainties and may affect the legal protections available to you and us. For more details, see “Item 3. Key Information—D. Risk Factors—Risks Related to Doing Business in Mainland China—Uncertainties with respect to the legal system of mainland China and the interpretation and enforcement of laws and regulations of mainland China may affect the legal protections available to you and us;” ● The PRC government may exert more control over offerings conducted overseas by and/or foreign investment in our company, which could result in a material change in our operations and/or the value of our securities. Any actions by the PRC government to exert more oversight and control over offshore offerings could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline or become worthless. The approval of and filing with the China Securities Regulatory Commission or other government authorities in mainland China may be required in connection with our future offshore offerings and capital raising activities under law of mainland China, and, if required, we cannot predict whether or for how long we will be able to obtain such approval or complete such filing. For more details, see “Item 3. Key Information—D. Risk Factors—Risks Related to Doing Business in Mainland China—The approval of and filing with the China Securities Regulatory Commission or other government authorities in mainland China may be required in connection with our future offshore offerings and capital raising activities under law of mainland China, and, if required, we cannot predict whether or for how long we will be able to obtain such approval or complete such filing;” and ● The funds in our subsidiaries in mainland China or the VIE may not be available to fund operations or for other use outside of mainland China due to interventions in or the imposition of restrictions and limitations on the ability of our holding company, our subsidiaries or the VIE by the PRC laws and regulations on currency conversion. For more details, see “Item 3. Key Information—D. Risk Factors—Risks Related to Doing Business in Mainland China—Our subsidiaries in mainland China and the variable interest entity are subject to restrictions on paying dividends or making other payments to us, which may restrict our ability to satisfy our liquidity requirements.” Risks Related to Our ADSs ● The trading price of our ADSs has been volatile and may be volatile regardless of our operating performance; ● Our dual-class share structure with different voting rights will limit your ability to influence corporate matters and could discourage others from pursuing any change of control transactions that holders of our Class A ordinary shares and ADSs may view as beneficial; ● The dual-class structure of our ordinary shares may adversely affect the trading market for our ADSs; and 15 Table of Contents ● We believe that we were likely a passive foreign investment company for U.S. federal income tax purposes for the taxable year ended December 31, 2025, which could subject United States investors in our ADSs or Class A ordinary shares to adverse U.S. federal income tax consequences. Risks Related to Our Business and Our Industry If we fail to keep our existing users highly engaged, to further expand our user reach, or to effectively monetize our user base, our business, profitability and prospects may be adversely affected. Our success depends on our ability to maintain and grow our user base and keep our users highly engaged. In order to attract, retain and engage users and remain competitive, we must continue to innovate our products and services, implement new technologies and strategies, offer interesting content, improve features of our platform and stimulate interactions in our community. A decline user activity or engagement may adversely affect the vibrancy of our community, which may in turn reduce our monetization opportunities and have a material and adverse effect on our business, financial condition and results of operations. If we are unable to maintain strong user engagement or effectively monetize our user base, our revenues may decline and our results of operations and financial condition may suffer. We cannot assure you that our platform will remain sufficiently popular with users to offset the costs incurred to operate and expand it. It is vital to our operations that we remain sensitive and responsive to evolving user preferences and offer content that attracts our users. We must also keep providing our users with new features and functions to enable superior content viewing and social experience. We will need to continue to develop and improve our platform and to enhance our brand awareness, which may require us to incur substantial costs and expenses. We cannot assure you that increased costs and expenses will effectively translate into improved user traffic or engagement. Additionally, if we decide to consciously scale back our marketing and promotional expenditures, we may experience a decline in user base and user engagement on our platform, which may in turn adversely affect our results of operations. Furthermore, as we increasingly expand our user reach beyond our own platforms, our ability to effectively manage and monetize user engagement across diverse third-party content platforms is subject to various uncertainties, which may in turn adversely affect our results of operations. We may fail to attract and retain talented and popular broadcasters. The size and engagement level of our user base as well as the quality of the live streaming content offered on our platform are critical to our success and are closely linked to our broadcasters’ involvement and performance. Although we have entered into multi-year cooperation agreements that contain exclusivity clauses with some of the popular broadcasters on our platform, if any of these broadcasters decides to breach the agreement or chooses not to continue the cooperation with us once the term of the agreement expires, the popularity of our platform may decline and the number of our users may decrease, which could materially and adversely affect our results of operations and financial condition. In addition to our most popular broadcasters, we must continue to attract and retain talented and productive broadcasters in order to maintain and increase our content offerings and ensure the sustainable growth of our game live streaming community. We must identify and acquire potential talented broadcasters and provide them with sufficient resources. We cooperate with talent agencies to recruit, manage, train and support our broadcasters. However, we cannot assure you that we can continue to maintain the same level of attractiveness to our broadcasters and talent agencies. Furthermore, as we continue to optimize our operational efficiency and potentially adjust our spending on broadcaster incentives, we may face increased challenges in retaining broadcasters. In addition, we engage in directly managing certain broadcasters to produce and distribute content on our own platforms or on various third-party content platforms, which may pose additional operational complexities and management challenges. Broadcasters on our platform, including those who have entered into exclusivity agreements with us, may leave us for other platforms which may offer better services and terms than we do. Furthermore, we may lose broadcasters if the talent agencies that manage them are unable to reach or maintain satisfactory cooperation arrangements with such broadcasters. In addition, if talented and popular broadcasters cease to contribute content to our platform, or their live streams fail to attract users, we may experience a decline in user base and user engagement, which may have a material and adverse impact on our results of operations and financial conditions. 16 Table of Contents We may fail to offer attractive content, in particular popular game content, on our platform. We offer comprehensive live streaming content with a primary focus on games. Our content library is constantly evolving and developing. Game content has been a key genre of our content offerings since our inception. Our ability to maintain an attractive library of game content largely depends on the variety and availability of popular games in mainland China, which may be affected by various factors, including but not limited to, investments by game developers and publishers, game market conditions and regulatory supervision and approval. If there is a decrease in the number of new games launched or approved for launch in mainland China, or if there is a decrease in the number of users on existing popular games, or if we fail to live stream popular games due to various legal or business restrictions, our operations may be negatively impacted and we may face difficulties in continuously supplying attractive game content. Among the various types of gaming content on our platform, e-sports tournaments and game events constitute an important genre to generate our user traffic. If we fail to obtain the broadcasting rights for popular e-sports tournaments and game events and fail to produce popular tournaments and events in-house, or we fail to attract users through these e-sports tournaments and game events, we may experience decreased users, viewership and user engagement, which may materially and adversely affect our results of operations and financial condition. Moreover, there are uncertainties with respect to the interpretation and implementation in practice of the laws and regulations governing online games. Pursuant to laws and regulations in mainland China, operators who operate online games without governmental pre-approval are prohibited from publishing and operating such games. The grants of pre-approval for online game operation have not be stable historically and the likelihood of successfully obtaining one is uncertain. Additionally, regulatory actions have been taken over the past few years to further regulate the game industry. For example, on August 30, 2018, the government of mainland China issued a notice implementing a plan to protect the eyesight of teenagers, which, among other things, regulates the number of online games and new releases. On August 30, 2021, the government of mainland China issued a Notice on Further Strengthening the Management and Effectively Preventing Minors from Becoming Addicted to Online Games, which became effective on September 1, 2021 and imposes compliance obligations on game operators to limit minors’ gaming time and implement real-name verification. On April 12, 2022, the government of mainland China issued a Notice on Strengthening the Administration of Live Streaming Games on the Online Audio-Visual Program Platforms, which strictly prohibits dissemination of any illegal games. Given that, if game publishers and operators fail to maintain the normal publication and operation of their online games, or if they fail to obtain or make the necessary approvals and filings of their online games, our content offerings may be negatively impacted, and we may be subject to penalties for live streaming or promoting such games on our platform. In addition, in response to our users’ interests, we also offer other entertainment content genres. We actively track viewership growth and community feedback to identify trending content and encourage our broadcasters and talent agencies to create content that caters to users’ constantly changing taste. We also cooperate with broadcasters, talent agencies and other video content creators to offer video content such as gameplay videos, e-sports videos, and other videos, to cater for the increasing needs for diversified content of our users. However, if we fail to continue to expand and diversify our content offerings, identify trending and popular genres, or maintain the quality of our content, we may experience decreased viewership and user engagement, which may materially and adversely affect our results of operations and financial conditions. Furthermore, we largely rely on our broadcasters and talent agencies to create high-quality and fun live streaming content. We have in place a comprehensive and effective incentive mechanism to encourage broadcasters and talent agencies to supply content that is attractive to our users. Also, talent agencies cooperating with us may guide or influence broadcasters to live streaming content that is well received by our users. However, if we fail to observe the latest trends and timely guide broadcasters and talent agencies accordingly or fail to attract broadcasters who are capable of creating content based on popular games, or if broadcasters fail to produce content for trending games, our user number may decline and our financial condition and results of operations may be materially and adversely affected. 17 Table of Contents We are undertaking a strategic transformation to expand our presence in the game industry. We cannot assure you that the transformation will succeed or achieve anticipated effect, and our results of operations may be materially and adversely affected as a result. We are committed to serving the evolving needs of game enthusiasts, content creators and our partners across the game value chain. We are undertaking a strategic transformation to expand our presence in the game industry, exploring new opportunities that complement our user community and content ecosystem to drive sustainable long-term business development. In doing so, since August 2023, we have been implementing various initiatives to drive a shift in our commercialization roadmap by offering more game-related services, such as game distribution, in-game item sales and game advertising, while also optimizing content creators’ income structure to boost their financial rewards and better align our content costs with our revenues. To achieve these goals, we are proactively adjusting various aspects of our business for a more targeted allocation of internal resources. While we aim to increase the proportion of revenues from game-related services and achieve a more balanced revenue mix across the value chain, these initiatives may cause some volatility in our results of operations and financial conditions in the near term. We are also exploring game publishing opportunities, For example, we launched our co-published title Goose Goose Duck mobile in the Chinese mainland in January 2026, and we may face additional risks and challenges in connection with such initiatives. Additionally, as we have limited experience in game industry, our efforts in expanding our business presence in the game industry may not succeed and we may not be able to generate sufficient revenue to cover our investment and become profitable. In addition, our success to expand our presence in the game industry depends on our ability to maintain existing relationships and establish new relationships with game companies on terms and conditions acceptable to us, which we may fail to secure. We face competition in several major aspects of our business. If we fail to compete effectively, our business, results of operations and financial condition may be negatively impacted. We face competition in several major aspects of our business, particularly from companies that provide game live streaming services and other online entertainment services, including companies that our shareholders operate or invest in and companies that our shareholders may operate or invest in in the future. As we are expanding our presence in the game industry and offer more game-related services, we also face additional competition from the game industry and other game service providers. See “Item 4. Information on the Company—B. Business Overview—Competition.” Some of our competitors may have longer operating histories, significantly larger user bases, more established brand names, broader product or service offerings, significantly greater financial, technical and marketing resources than we do or have long-term strategic relationships with game developers or publishers, and in turn may have an advantage in attracting and retaining users, broadcasters, talent agencies, advertisers and other business partners. Our competitors may also compete with us for content such as games, e-sports tournaments and game events; business partners such as broadcasters, talent agencies, and advertisers; skilled personnel such as management, engineers, product and content personnel; and other resources such as user traffic, user time spent online, and investments. Furthermore, if we are involved in disputes with any of our competitors that result in litigations or negative publicity to us, such disputes, regardless of their veracity or outcome, may harm our reputation or brand image and in turn lead to a reduced number of users and advertisers. Any legal proceedings or measures we take in response to such disputes may be expensive, time-consuming and disruptive to our operations and divert our management’s attention. If we are not able to effectively compete in one or more of our business lines, our business, results of operations may be negatively impacted, for example, our overall user base and level of user engagement may decrease, which could reduce the number of our paying users or make us less attractive to broadcasters, talent agencies, advertisers, and other business partners. If we are not able to compete effectively, it may lead to decrease in revenues and increase in costs and expenses, which may have a negative impact on our results of operations and financial condition. We may also be required to devote additional resources to increase our brand recognition and promote our products and services, and there can be no assurance that such additional spending will generate anticipated result. 18 Table of Contents Intensified government regulations, rules or guidelines of the internet industry in mainland China could restrict our ability to maintain or increase the level of user traffic to, and user spending on, our platform as well as our ability to tap into other market opportunities, and negatively impact our businesses, results of operations, or financial condition. The government of mainland China has promulgated, in recent years, intensified regulations, rules, or guidelines on various aspects of the internet industry in mainland China. For example, the government of mainland China adopted more stringent policies to monitor the online games industry due to negative public perception of addiction to online games, including policies for the protection of minors. See “Item 4. Information on the Company—B. Business Overview—Government Regulations—Anti-fatigue Compliance System and Real-name Registration System” for details. On November 12, 2020, the government of mainland China promulgated the Notice on Strengthening the Administration of the Online Show Live Streaming and E-commerce Live Streaming, which sets forth registration requirements for platforms providing online show live streaming or e-commerce live streaming to have their information and business operations registered by November 30, 2020. This regulation also set forth requirements for certain live streaming businesses with respect to real-name registration, limits on user spending on virtual gifting, restrictions on minors on virtual gifting, live stream review personnel requirements, content tagging requirements, and other requirements. For example, this regulation requires live streaming platforms to set a limit to the amount of virtual gifts a user can send per day and per month, as well as the amount that can be gifted at any one time. However, there is currently no clear guidance as to the specific levels of limits on virtual gifting spending to be applied pursuant to this regulation and it is unclear how and to what degree any such limits would be imposed on different platforms. Furthermore, in recent years, mainland China has seen promulgation of various other regulations and opinions concerning online live streaming platforms, user spending and virtual gifting. See “Item 4. Information on the Company—B. Business Overview—Government Regulations—Online Transmission of Audio-Visual Programs.” For example, on May 7, 2022, the government of mainland China issued the Opinion on Live Streaming Virtual Gifting and Enhancing the Protection of Minors, which stipulates that internet platforms shall, among other restrictions, (i) within one month of the publication of this opinion terminate all billboard functions that rank users or broadcasters by the volume of virtual gifts that they send or receive, respectively, (ii) restrict certain interaction and engagement functions between 8:00 p.m. and 10:00 p.m. every day, and (iii) prohibit minors from giving rewards for live-streaming. In response to this opinion, we have proactively sought guidance from and cooperated with government authorities in connection with the efforts that we should devote in complying with this opinion and related implementation rules. While we will continue to comply with all applicable laws and regulations in providing live streaming services, there can be no assurance that the measures that we take will be effective or our compliance efforts will be well received by the governmental authorities. In addition, new laws and regulations, rules or guidelines may be introduced to address emerging issues, and some of them may put additional restrictions on our users, broadcasters, content, product offerings or service offerings, potentially having negative impact on our businesses, results of operations, or financial condition. We are also subject to a variety of regulatory restrictions concerning the age limit for broadcasters, as well as restrictions on our products’ features. The existing and future regulations rules and guidelines that could affect us are beyond our control, and their potential impact on us is difficult to predict. We may incur substantial financial, operational and managerial costs in response to and in anticipation to the regulatory and policy risks, and we may not be able to effectively predict, estimate or manage those risks in a timely and cost-efficient manner. Moreover, we may not timely obtain or maintain all the required licenses or approvals or to satisfy all the requirements posed by the authorities in the future. As we are undertaking a strategic transformation to expand our presence in the game industry and we might expand into other internet businesses in the future, we cannot assure you that we will be able to obtain the required licenses or approvals or to satisfy all the requirements posed by the authorities. If we fail to timely obtain or maintain any of the required licenses or approvals, we may be subject to various penalties, which may disrupt our business operations or derail our business strategy, and materially and adversely affect our business, financial condition and results of operations. See “—If we fail to obtain and maintain the licenses and approvals required under the complex regulatory environment for internet-based businesses in mainland China, our business, financial condition and results of operations may be materially and adversely affected” and “Item 4. Information on the Company—B. Business Overview—Government Regulations.” 19 Table of Contents If we fail to obtain and maintain the licenses and approvals required under the complex regulatory environment for internet-based businesses in mainland China, our business, financial condition and results of operations may be materially and adversely affected. The internet industry in mainland China is highly regulated. See “Item 4. Information on the Company—B. Business Overview—Government Regulation” for details. For example, an internet information service provider shall obtain an ICP License from the Ministry of Industry and Information Technology of China or its local counterparts before engaging in any commercial internet information services. The variable interest entity, Guangzhou Huya, has obtained a valid ICP License for provision of internet information services, a radio and television program production and operating permit, a commercial performance license and an internet culture operation license for music entertainment products, animation products, and online performance. Under the PRC Administrative Provisions for the Internet Audio-Video Program Service, providers of internet audio-visual program services are required to obtain a license for online transmission of audio-visual programs, or the Audio-Visual License, issued by the National Radio and Television Administration, or complete certain registration procedures with the National Radio and Television Administration. In August 2018, the Notice on Strengthen the Management of Live Streaming Service was issued by governmental authorities of mainland China, which requires internet live streaming providers involving internet audio-visual program live streaming services to obtain the Audio-Visual License and complete certain registration procedures with the local public security authority. Guangzhou Huya has registered and filed its business development regarding its live streaming service on Information Management System for National Online Audio-Visual Platforms and the Guangzhou Aowei Information Technology Co., Ltd., a subsidiary of Guangzhou Huya, has obtained the Audio-Visual License on February 28, 2024. According to the Notice on Issues Concerning Strengthening the Administration of Live Streaming Services of Online Audiovisual Programs issued by the government of mainland China on September 2, 2016, live streaming services covering (i) major political, military, economics, social, cultural, and sports activities and events streaming or (ii) activities such as general social groups cultural activities and sports events are required to apply for an Audio-Visual License. Currently, we allow broadcasters and users to upload their recorded or edited video clips to our platform. We also selectively record and edit live streaming gameplays of certain popular broadcasters and turn them into video clip highlights. Streaming those videos on our platform may be regarded as providing internet audio-video program service. If our practice of offering video clips is deemed as violating the PRC Administrative Provisions for the Internet Audio-Video Program Service, our ability to expand our business scope may be limited and we may be subject to fines or other regulatory actions by the regulators. Moreover, we may be required to obtain additional licenses or approvals for our video clip services if the government of mainland China adopts more stringent policies or regulations on online video clips offerings. As we develop our video service offerings, we may need to obtain additional qualifications, permits, approvals or licenses. New laws and regulations that apply to the internet industry in mainland China may be adopted from time to time to address new issues that come to the authorities’ attention. Considerable uncertainties still exist with respect to the interpretation and implementation of existing and future laws and regulations governing our business activities. We cannot assure you that we will not be found in violation of any current or future laws and regulations due to potential changes in the authorities’ interpretation of these laws and regulations. In addition, we may be required to obtain additional licenses or approvals, and we cannot assure you that we will be able to timely obtain or maintain all of the required licenses or approvals or make all of the necessary filings in the future. If we fail to obtain or maintain any of the required licenses or approvals or make the necessary filings, we may be subject to various penalties, such as confiscation of the net revenues that were generated through the unlicensed internet activities, the imposition of fines and the discontinuation or restriction of our operations. Any such penalties may disrupt our business operations and materially and adversely affect our business, financial condition and results of operations. We cooperate with various talent agencies to manage and recruit our broadcasters. If we are not able to maintain our relationship with talent agencies, in particular the platinum talent agencies which possess the capacity to produce a large volume of high-quality content and manage a considerable pool of talent, our operations may be materially and adversely affected. We cooperate with talent agencies to manage, organize and recruit broadcasters on our platform. As we are an open platform that welcomes qualified broadcasters to register on our websites, cooperation with talent agencies substantially increases our operational efficiency in terms of discovering, supporting and managing broadcasters in a more organized and structured manner, and turning amateur broadcasters into full-time broadcasters. 20 Table of Contents We share a portion of the revenues generated from the sales of virtual items and other products and services attributed to the broadcasters’ live streams with broadcasters and talent agencies who manage these broadcasters. If we cannot balance the interests between us, the broadcasters and the talent agencies and design a revenue-sharing mechanism that is agreeable to both broadcasters and talent agencies, we may not be able to retain or attract broadcasters or talent agencies, or both. In addition, while we have entered into exclusive streaming agreements with certain broadcasters, none of the talent agencies we cooperate with has an exclusive cooperation relationship with us. If other platforms offer better revenue sharing incentive to talent agencies, such talent agencies may choose to devote more of their resources to broadcasters who stream on the other platforms, or they may encourage their broadcasters to use or even enter into an exclusive agreement with other platforms, all of which could materially and adversely affect our business, financial condition and results of operations. We are subject to risks associated with operating in a rapidly changing industry and a relatively new market. Many elements of our business are unique, evolving and relatively unproven. Our business and prospects depend on the continuing development of the live streaming industry in mainland China. The market for our services is relatively new and rapidly changing and is subject to significant challenges. In addition, since we are undertaking a strategic transformation to expand our presence in the game industry and offer more game-related services, the future development and evolvement of the game industry will have an impact on the prospects of our business. Our business relies upon our ability to cultivate, grow and maintain an active game live streaming and game user community and to successfully monetize our user base, so as to increase revenues from our live streaming as well as game-related services and online advertising services. In addition, our business development depends, in part, on our ability to respond to constant changes in the internet industry, including rapid technological evolution, continued shifts in customer demands, frequent introductions of new products and services and constant emergence of new industry standards and practices. Developing and integrating new content, services or infrastructure could be expensive and time-consuming, and these efforts may not yield the benefits we expect to achieve at all. For example, our strategic transformation to expand our business in the game industry may not succeed. We cannot assure you that we will succeed in any of these aspects or that these industries in mainland China will continue to change as rapidly as they have in the past. As users are facing a growing number of entertainment options that directly or indirectly compete with online live streaming, live streaming may not maintain or increase its current popularity. Growth of the live streaming industry is affected by numerous factors, such as content quality, user experience, technological innovations, development of internet and internet-based services, regulatory environment, and macroeconomic environment. If live streaming as a form of entertainment loses its popularity due to changing social trends and consumer preferences, our results of operations and financial condition may be materially and adversely affected. We have made investments in applications of AI technologies and other technological advancements, and may face uncertainties with respect to their commercialization and the evolving laws and regulations applicable to us. The live streaming platforms and online content communities are evolving with continued technological advancements. To enhance content creation and user experience and beyond, we have made investments in applications of AI technologies, including AI-powered live-streaming, AI-powered game tools, among others, and have also allocated resources in these areas, including human resources and technology updates. Our success will depend on our ability to keep up with these technological advancements. For instance, applications of foundation models and generative AI to our products and services to cater to user needs may be essential for us to remain competitive in the market and any failure in maintaining or improving the effectiveness of these technologies may impede our understanding of user preferences and content creators, consequently adversely affecting our capability to manage content operations and user experience. Therefore, failure to keep up with technological advancement may result in a decline in demand for our products and services, which may in turn materially and adversely affect our business, financial condition, results of operations, and prospects. For example, we continue to integrate AI technologies throughout the entire cycle of live streaming content production, distribution, and consumption with the aim to improve broadcasters’ content creation efficiency, foster AI-powered digital IP innovation, and facilitate the design of more distinctive virtual streamers. However, we cannot guarantee the success of implementing these technologies in our products and services, nor the effectiveness of our efforts and investments in these technological advancements. Furthermore, the research and development of technological changes and innovations may require substantial capital expenditures, along with the need for products or services upgrades. We cannot assure you that we will have necessary capital, or access to additional capital in a timely manner or on acceptable terms, to adequately support our investments in these technologies. 21 Table of Contents In addition, the regulatory and legal framework on generative AI of mainland China is also evolving rapidly. In recent years, the government authorities of mainland China have released a series of laws and regulations related to generative AI services, including the Administrative Provisions on Algorithm Recommendation of Internet Information Services, the Administrative Provisions on Deep Synthesis of Internet Information Services and the Interim Measures for the Administration of Generative Artificial Intelligence Services. See “Item 4. Information on the Company—B. Business Overview—Government Regulations—Regulations on Artificial Intelligence.” However, these laws and regulations related to generative AI services are relatively new, and the competent government authorities of mainland China may introduce additional or more detailed laws and regulations to oversee the generative AI services. Therefore, we may need to comply with more compliance requirements in the field of generative AI, which may increase our compliance costs. We also face uncertainties with respect to such evolving laws and regulations as well as their interpretations and our business operations and development may be affected as a result. Our revenue model for live streaming may not remain effective and we cannot guarantee that our future monetization strategies will be successfully implemented or generate sustainable revenues and profit. We operate our live streaming platform primarily using a revenue model whereby users can get free access to live streaming of game or other types of content but have the options to purchase our products or services. We have generated, and may continue to generate, a substantial majority of our live streaming revenues using this revenue model, although revenue contribution from live streaming may decline as we continue to implement a strategic transformation to expand our presence in the game industry and offer more game-related services. In 2023, 2024 and 2025, our live streaming revenues contributed to 92.2%, 78.1% and 70.7% of our total net revenues, respectively. Our live streaming revenues experienced a decline in 2023, 2024 and 2025, and we may continue to experience a decline and not be able to achieve a growth in the future, as the user demand for this service may change, decrease substantially or dissipate, we may fail to anticipate and serve user demands effectively, or we may have to make adjustments on our live streaming revenue model under intensified regulations, rules, or guidelines on the live streaming industry and we may not be able to mitigate revenue impacts of those adjustments, or our live streaming revenue model may not be competitive and we may lose market share if competition in the live streaming industry further intensifies. Although we factor in industry standards and user demand in determining how to optimize our monetization effectively, if we fail to properly manage the supply and timing of our products and services and their appropriate prices, our users may be less likely to make purchases from us. In addition, if users’ spending habits change and they choose to only access our content for free without additional purchases, we may not be able to continue to successfully implement our revenue model for live streaming, in which case we may have to provide other value-added services or products to monetize our user base. We cannot guarantee that our attempts to monetize our user base and products and services will continue to be successful, profitable or widely accepted, and therefore the future revenue and income potential of our business are difficult to evaluate. Changes in international trade policies and rising political tensions, particularly between the U.S. and China, may adversely impact our business and operating results. There have been changes in international trade policies and rising political tensions, particularly between the U.S. and China and as a result of the conflict between Ukraine and Russia and sanctions on Russia. The U.S. government has implemented policies restricting international trade and investment, such as tariffs, export controls, economic or trade sanctions, and foreign investment filing and approval requirements. These actions may materially and adversely affect international trade, global financial markets, and the stability of the global economic condition. Recently, President Trump has imposed prohibitively high tariffs on Chinese imports, and China has retaliated with its own tariffs and other counter-measures. Other economies that are affected by increased tariffs by the United States are also considering imposing or increasing tariffs on goods from the United States, although after President Trump announced a 90-day pause on the individualized higher tariff rates for other countries, it is unclear how this situation will develop. As of the date of this annual report, there is still a high degree of uncertainty surrounding U.S. tariff policy, how it will be implemented, and how other countries will react to it. It also remains uncertain whether increased tariffs and trade tensions will create further disruptions and uncertainties to the international trade and lead to a downturn to the global economy. While cross-border trade is not a primary area of focus for us, any unfavorable government policies on international trade may affect the demand for our services, or prevent us from providing services in certain countries. If any new tariffs, legislation and/or regulations are implemented, existing trade agreements are renegotiated or, in particular, the U.S. government takes further actions due to ongoing U.S.-China trade tensions, such changes could have an adverse effect on our business, financial condition, and results of operations. In addition, escalating U.S.-China tariff tensions have triggered a chain reaction of economic and political repercussions, including U.S. legislative and policy initiatives that may impose stricter measures on China-based companies listed on U.S. stock exchanges. 22 Table of Contents The United States has also taken efforts to limit U.S. investment in China. On October 28, 2024, the U.S. Department of the Treasury issued a final rule to prohibit U.S. investment in Chinese companies active in developing certain national security technologies, or the Outbound Investment Rule. The Outbound Investment Rule targets investments involving persons and entities associated with “countries of concern,” a designation currently limited to China. In effect since January 2025, the Outbound Investment Rule imposes investment prohibitions and notification requirements on a range of investments in companies engaged in activities relating to three sectors: (i) semiconductors and microelectronics, (ii) quantum technologies, and (iii) artificial intelligence systems. Persons from countries of concern engaged in these activities are defined as “covered foreign persons.” Investments by U.S. persons subject to the Outbound Investment Rule include the acquisition of equity or a contingent equity interest, the provision of certain debt financing, the conversion of contingent equity interest into equity interest, involvement in a greenfield or brownfield investment, entrance into a joint venture, and the acquisition of a limited partner interest in non-U.S. pooled investment fund. The Outbound Investment Rule is aimed at exerting greater U.S. government oversight of U.S. direct and indirect investments involving China, and may introduce new hurdles and uncertainties for cross-border collaborations, investments, and funding opportunities of China-based companies. Importantly, the Outbound Investment Rule excludes some investments from the scope of covered transactions, including those in publicly traded securities listed on a national stock exchange. U.S. persons’ acquisitions of publicly traded securities, such as our ADSs, will therefore be exempted from the scope of covered transactions under the Outbound Investment Rule. We do not believe we would be considered a “covered foreign person” under the Outbound Investment Rule. However, there is no assurance that the U.S. Department of Treasury will take the same view as ours. If we were to be deemed a “Covered Foreign Person,” and if U.S. persons were to engage in a “covered transaction” (as defined under the Outbound Investment Rule) that involves the acquisition of our equity interests, such U.S. persons may need to make a notification pursuant to the Outbound Investment Rule. In addition, policies continue to evolve and we cannot rule out the possibility of being deemed a Covered Foreign Person in the future due to different views taken by the U.S. Department of Treasury, potential amendments to the Outbound Investment Rule or the introduction of additional regulations. For example, on December 18, 2025, the Comprehensive Outbound Investment National Security Act of 2025, or the COINS Act, was signed into law. The COINS Act largely preserves the core framework of the Outbound Investment Rule, while expanding its scope and coverage in certain respects. The COINS Act will not become effective until the U.S. Department of the Treasury issues implementing regulations, which must be promulgated through notice-and-comment rulemaking and no later than March 13, 2027. Accordingly, the Treasury may amend, expand or otherwise modify existing outbound investment prohibitions and restrictions pursuant to the COINS Act. In addition, on February 21, 2025, the White House released President Trump’s “America First Investment Policy” memorandum, outlining several initiatives to incentivize investment from U.S. allies and partners while restricting investments involving “foreign adversaries,” including China. Among other things, the policy aims to expand the industry sectors covered by the U.S. outbound investment regulations and supplement outbound restrictions through the imposition of sanctions. As of the date of this annual report, the proposed changes under the America First Investment Policy are not implemented, although the proposed restrictions may further deepen the uncertainties for cross-border collaborations, investments, and funding opportunities for China-based issuers including us. If our ability to raise such capital is significantly and negatively affected, it could be detrimental to our business, financial condition and prospects, and our ADSs may significantly decline in value. In addition, on September 29, 2025, the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) issued an immediately effective interim final rule that, among others, extends Entity List and Military End-User List restrictions to entities that are 50% or more owned, directly or indirectly, by parties designated on those lists. This rule is currently suspended for one year. If implemented, these measures are expected to have significant impact on the targeted countries, markets and/or entities, making compliance more complicated and time-consuming and increasing the risk of inadvertent omissions. Besides, in the event that any of our major business partners become subject to sanctions or restrictions by the U.S. government, our business may be negatively and adversely affected. Rising trade and political tensions could reduce levels of trades, investments, technological exchanges and other economic activities between China and other countries, which would have an adverse effect on global economic conditions, the stability of global financial markets, and international trade policies. It could also adversely affect the financial and economic conditions in the jurisdictions in which we operate, as well as our overseas expansion, our financial condition, and results of operations. We have an international business and may expand our global footprint in the future. Any rising trade and political tensions or unfavorable government policies on international trade and Chinese companies could impact our competitive position or hinder our commercial activities in certain countries. In addition, our results of operations could be adversely affected if any such tensions or unfavorable government trade policies harm the Chinese economy or the global economy in general. ​ 23 Table of Contents We have a unique community culture that is vital to our success. Our operations may be materially and adversely affected if we fail to maintain our culture within our addressable user communities. We have cultivated an interactive and vibrant online social community, centered around live game streaming. We provide resources and support to the broadcasters through talent agencies that help train and retain talented broadcasters on our platform, who in turn, attract and retain users. We also enhance user experience by constantly improving user interface and features of our platform and encouraging active interaction between users and broadcasters. We believe that maintaining and promoting such a vibrant community culture is critical to retaining and expanding our user and broadcaster base. We have taken multiple initiatives to preserve our community culture and values. Despite our efforts, we may be unable to maintain our community culture and cease to be the preferred platform for our target users, broadcasters and talent agencies. For example, frictions among our users or broadcasters and inflammatory comments posted by internet trolls may damage our community culture and brand image, which would be detrimental to our business operations. We generate a portion of our revenues from advertising. If we fail to attract more advertisers to our platform or if advertisers are less willing to advertise with us, our revenues may be adversely affected. Although we primarily rely on revenues generated from live streaming services, we generate a portion of our revenues from advertising. Our revenues from advertising partly depend on the continued development of the online advertising industry in mainland China and advertisers’ willingness to allocate budgets to online advertising. In addition, companies that decide to advertise or promote online may utilize more established methods or channels, such as more established Chinese internet portals or search engines, over advertising on our platform. As we expand our offerings to provide more game-related services, such as game advertisements, the development of the game industry may influence the demand for our advertising services from game companies. If the online advertising market does not continue to grow, or if we are unable to capture and retain a sufficient share of that market, our ability to increase our current level of advertising revenues and our profitability and prospects may be materially and adversely affected. Furthermore, our core and long-term priority of optimizing user experience and satisfaction may limit our platform’s ability to generate revenues from advertising. For example, in order to avoid interruptions to our users’ entertainment experience, we may restrict or limit advertising during streaming. While this decision would adversely affect our operating results in the short term, we believe it enables us to provide a superior user experience on our platform, which will help us expand and maintain our current user base and enhance our monetization potential in the long term. However, this philosophy of putting our users first may also negatively impact our relationships with advertisers or other third parties, and may not result in the long-term benefits that we expect, in which case the success of our business and operating results could be harmed. On February 25, 2023, the State Administration for Market Regulation of China promulgated the Measures for the Administration of Internet Advertisements, which became effective on May 1, 2023. The regulation stipulates that the promotion of commodities or services through paid listings on the internet must be clearly identified as advertisements to distinguish them from the natural search results. Furthermore, the measures require advertisers, operators and publishers of internet advertisements containing links to examine the content of the next-level link. It is also noted that the Chinese government may, from time to time, promulgate new advertising laws and regulations in the future. We cannot assure you that we will be in compliance with the requirements under these new laws and regulations. Failure to comply with these obligations may subject us to fines and other administrative penalties and may negatively impact our relationships with advertisers or other third parties. We may suffer from a loss of advertisers and our business and results of operations may be materially and adversely affected. We offer advertising services primarily through contracts entered into with advertisers or advertising agencies and by displaying advertisement on our platform or providing advertising integrated in the content offered on our live streaming platform. We also offer advertisements through cooperation with our popular broadcasters and other content creators. We cannot assure you that we will be able to attract or retain direct advertisers or advertising agencies. If we fail to retain and enhance our business relationships with these advertisers or advertising agencies, or if our cooperation with broadcasters and other content creators to provide advertisements is not successful, we may suffer from a loss of advertisers and our business and results of operations may be materially and adversely affected. If we fail to retain existing advertisers and advertising agencies or attract new direct advertisers and advertising agencies or any of our current advertising methods or promotional activities becomes less effective, our business, financial condition and results of operations may be adversely affected. We continue to evolve our advertising offerings, including incorporating more performance-based advertising, which require additional technologies and sophisticated data analytics to track and measure advertising effectiveness. We also collaborate with third-party advertising partners and strategic partners to support these initiatives and extend our advertising reach. However, we cannot assure you that these initiatives will be as effective or competitive as those offered by more established platforms, which could limit our ability to further grow our advertising revenues. 24 Table of Contents Significant revenue sharing fees and content costs on our platform have had and may continue to have an adverse effect on our business, financial condition and results of operations. We need to continue offering popular and attractive content on our platform to provide our users with engaging and satisfying viewing experiences, and our ability to provide such content is dependent on our ability to attract and retain our broadcasters and talent agencies. We have a revenue sharing arrangement with both our broadcasters and talent agencies under which we share with them a portion of the revenues from the sales of our products and services, including live streaming services and game-related services. We also pay some popular broadcasters additional fees to sign agreements that contain exclusivity clauses with us. The absolute amounts and revenue percentages that we pay broadcasters and talent agencies may increase. If our competitor platforms offer higher revenue sharing ratios or additional fees with an intent to attract our popular broadcasters, costs to retain our broadcasters may increase. If we are not able to continue to retain our broadcasters and produce high-quality content on our platform at commercially acceptable costs, our business, financial condition and results of operations would be adversely impacted. Furthermore, as our business and user base further develop, we may have to devote more resources in attracting broadcasters and talent agencies to produce more content that meets the varied interests of a diverse user base, which would increase the costs of content on our platform. While we aim to optimize content creators’ income structure in the process of our strategic transformation to boost their financial rewards and better align our content costs with our revenues, we cannot assure you that this initiative will succeed or achieve anticipated effect. The portion of revenues we share with our broadcasters for live streaming services has remained at a relatively high level from 2023 to 2025 and we currently expect it to remain high in 2026, although there are still uncertainties, such as general market conditions. The significant revenue sharing fees with broadcasters has had and will continue to have a material adverse effect on our profitability. In addition, we pay game developers or publishers, e-sports tournaments and game events organizers and participants, and other content broadcasting right owners for content and increases in prices for these broadcasting rights would also have an adverse effect on our business, financial condition and results of operations. If we fail to procure these content, or if we fail to procure these content at commercially acceptable costs, our business and results of operations may be adversely impacted. Our licensed e-sports content costs decreased in 2023, 2024 and 2025, primarily because of our more stringent procurement policy for e-sports content and a decrease in prices of some key licensed e-sports tournaments. Substantial uncertainties remain as to whether we can procure anticipated content at commercially acceptable costs, or at all. As our self-organized e-sports tournaments are gaining popularity on our platform, we may also increase content production costs for in-house produced content. Even though we have put stringent procurement policy in place, we cannot assure you that our revenue sharing fees and content costs or our cost of revenues in general would necessarily decrease as a result. In addition, if we are unable to generate sufficient revenues that outpace our revenue sharing fees and content costs, or we experience a greater decline in revenues than the decline in revenue sharing fees and content costs, our business, financial condition and results of operations may be materially and adversely affected. We incurred net losses in the past, which may continue in the future. In 2023, 2024 and 2025, we incurred net loss of RMB204.5 million, RMB48.0 million and RMB112.6 million (US$16.1 million), respectively. We cannot assure you that we will be able to generate net income in the future. Furthermore, although we have been adopting measures to optimize costs and improve operational efficiency, we may continue to incur significant costs and expenses, such as costs and expenses to support our expansion into new business areas in particular game-related services, retain and attract content creators, acquire and produce content, maintain and grow our user base and generally expand our business operations, and research and development expenses and bandwidth and server custody fees to support our streaming functions, and personnel costs and expenses to attract and retain key employees, and investments to develop new businesses. We may again not be able to generate sufficient revenues to offset such costs and expenses to sustain profitability in the future. Our financial results may also be adversely affected by one-off provisions or charges related to our commercial arrangements. For instance, in 2025, we recognized a provision of RMB66.0 million (US$9.4 million) related to a receivable arising from a 2021 arrangement with a broadcaster, which was deemed to have a heightened risk of non-recoverability. We may also continue to incur impairment losses if we recognize impairment charges on our investments, such as due to the weak financial performance of certain investees, or we may incur goodwill impairment charges as a result of our acquisitions. In addition, we expect to continue to make necessary investments in our operations to maintain our current market position, support anticipated future growth and meet our reporting and compliance obligations as a public company. ​ 25 Table of Contents Our profitability is also affected by other factors beyond our control. For example, live streaming as a form of entertainment may not continue to retain or increase its viewership levels or popularity. In addition, advertisers may not increase or maintain their spending on live streaming platforms, including our platform. Furthermore, our expansion into game-related services may fail to gain sufficient market traction or achieve the anticipated financial results. We may not succeed in developing or promoting game-related service offerings that appeal to our users, and these new initiatives may not generate enough revenue to offset the associated costs and expenses. The continued success of our business depends on our ability to identify which services will appeal to our user base and to offer them on commercially acceptable terms. Our profitability also depends in part on our ability to monetize our user base, attract advertisers, enhance cooperation with game companies and successfully compete in a very competitive market. In addition, factors including regulatory trends, economic environment and monetary policies in mainland China and globally also affect our profitability. Increasing focus with respect to environmental, social and governance matters may impose additional costs on us or expose us to additional risks. Failure to adapt to or comply with the evolving expectations and standards on environmental, social and governance matters from investors and the government of mainland China may adversely affect our business, financial condition and results of operations. The government of mainland China and public advocacy groups have been increasingly focused on environment, social and governance, or ESG, issues in recent years, making our business more sensitive to ESG issues and changes in governmental policies and laws and regulations associated with environment protection and other ESG-related matters. Investor advocacy groups, certain institutional investors, investment funds, and other influential investors are also increasingly focused on ESG practices and in recent years have placed increasing importance on the implications and social cost of their investments. Regardless of the industry, increased focus from investors and the government of mainland China on ESG and similar matters may hinder access to capital, as investors may decide to reallocate capital or to not commit capital as a result of their assessment of a company’s ESG practices. Any ESG concern or issue could increase our regulatory compliance costs. If we do not adapt to or comply with the evolving expectations and standards on ESG matters from investors and the government of mainland China or are perceived to have not responded appropriately to the growing concern for ESG issues, regardless of whether there is a legal requirement to do so, we may suffer from reputational damage and the business, financial condition, and the price of our ADSs could be materially and adversely affected. Our results of operations are subject to substantial quarterly and annual fluctuations due to seasonality. We may experience seasonality in our business, reflecting seasonal fluctuations in online entertainment consumption. As a result, comparing our operating results on a period-to-period basis may not be meaningful. For example, our users, revenues, or profits may be impacted by public holidays, school vacations, e-sports tournaments and game events that we launch from time to time, marketing campaigns and promotional activities that we conduct from time to time, new game launches on the market and game operational activities that game companies conduct from time to time, or regulations, rules and guidelines that government authorities pose from time to time. Overall, the historical seasonality of our business has been relatively mild, but seasonality may increase in the future. Due to our limited operating history, the seasonal trends that we have experienced in the past may not apply to, or be indicative of, our future operating results. As a result, our operating results in future quarters or years may fall below the expectations of securities analysts and investors. In such event, the trading price of our ADSs would likely be materially and adversely affected. We are a relatively young company, and we may not be able to effectively manage our development or implement our business strategies. We have a limited operating history, particularly as a stand-alone company. Our Huya platform was launched in 2014 as a business unit of JOYY Inc. (Nasdaq: JOYY). While we experienced significant growth since our platform was launched, our historical growth rate may not be indicative of our future performance due to our limited operating history and the rapid evolvement of our business environment. We may not be able to replicate our growth trajectory as we achieved in the past. Furthermore, we may adjust our product and service offerings or modify our business model. These adjustments may not achieve expected results and may have a material and adverse impact on our financial conditions and results of operations. 26 Table of Contents In addition, our development have placed, and could continue to place, significant strain on our management and resources. We believe that our continued development will depend on many factors, including our ability to develop new sources of revenues, diversify monetization methods, attract and retain users and content creators, increase user engagement, continue developing innovative technologies in response to user demand, increase brand awareness, expand into new market segments, and adapt to the macroeconomic and regulatory environment in mainland China. We cannot assure you that we will achieve any of the above, and our failure to do so may materially and adversely affect our business and results of operations. We have a limited operating history in overseas markets. If we fail to meet the challenges presented by our overseas operations, our business, financial condition and results of operations may be materially and adversely affected. We began our business operations overseas in May 2018. Furthermore, we acquired a 100% equity interest in a global mobile application service provider from Tencent in December 2023. Our global operation strategy might not be successfully executed and may expose us to a number of risks, including but not limited to: ● challenges in formulating effective local sales and marketing strategies targeting internet and mobile users from various jurisdictions and cultures, who have a diverse range of preferences and demands; ● challenges in identifying appropriate local third-party business partners such as game developers and publishers, e-sports tournament and game event organizers, broadcasters and talent agencies, and establishing and maintaining good working relationships with them; ● challenges in recruiting quality local broadcasters to attract and engage local users; ● challenges in effectively managing overseas operations from our headquarters and establishing overseas IT systems and infrastructure; ● challenges in selecting suitable geographical regions for global expansion and the general economic condition of various regions we operate; ● challenges in increasing and diversifying revenues, controlling costs and expenses, and making profits; ● fluctuations in currency exchange rates; ● regulatory actions, including sanctions brought against us or our business partners, initiated by local authorities; ● compliance with applicable foreign laws and regulations, including but not limited to internet content requirements, foreign exchange controls, cash repatriation restrictions, intellectual property protection rules, data privacy requirements, anti-money laundering laws and regulations, tax regulations and rules; and ● competition situations in various regions we operate. Our overseas operations may exert pressure on our operating results and net margins in the near term. Our overseas expansion may not progress at the intended pace, or generate the anticipated revenue to cover our investment and be profitable. Furthermore, the monetization of our overseas business may experience fluctuations. We cannot guarantee that we will be able to increase or sustain our overseas revenues in the future, as our current monetization may not continue to work, monetization strategies may change. In particular, our initiatives to diversify revenue sources, such as by providing more game-related and advertising services, or exploring other new product and service offerings, may not be successful. The geographic scope of our overseas markets and the product and service offerings we provide may also further change as we continually adjust our overseas business strategies. For example, we made major adjustments of the geographic coverage of Nimo TV as part of our overall strategy to focus on key markets in 2022, and we may further make adjustments in the future. In addition, the mobile application service provider we acquired may not achieve anticipated business performance or create the expected synergies with Nimo TV in the overseas markets. Our business, financial condition and results of operations may be materially and adversely affected by the risks associated with our overseas operations. 27 Table of Contents Our business depends substantially on the continuing efforts of our executive officers, key employees and qualified personnel, and our business operations may be severely disrupted if we lose their services. Our future success depends substantially on the continued efforts of our executive officers and key employees. If one or more of our executive officers or key employees were unable or unwilling to continue their services with us, we might not be able to replace them easily, in a timely manner, or at all. Since the internet industry is characterized by high demand and intense competition for talents, we cannot assure you that we will be able to attract or retain qualified staff or other highly skilled employees. In addition, as our company is relatively young, our ability to train and integrate new employees into our operations may not meet the evolving demands of our business which may materially and adversely affect our ability to grow our business and hence our results of operations. If any of our executive officers and key employees terminates their services with us, our business may be severely disrupted, our financial condition and results of operations may be materially and adversely affected and we may incur additional expenses to recruit, train and retain qualified personnel. Further, labor disputes, work stoppages or slowdowns at our company or any of our third-party service providers could significantly disrupt our daily operation or our expansion plans and have a material adverse effect on our business. If any of our executive officers or key employees joins a competitor or forms a competing company, we may lose customers, know-how and key professionals and staff members. Each of our executive officers and key employees has entered into an employment agreement and a non-compete agreement with us. However, as advised by our mainland China legal counsel, Commerce & Finance Law Offices, certain provisions under the non-compete agreement may be deemed invalid or unenforceable under laws of mainland China. If any dispute arises between our executive officers and key employees and us, we cannot assure you that we would be able to enforce these non-compete agreements in mainland China, where these executive officers reside, in light of variations in judicial interpretation and enforcement practice in mainland China. See “—Risks Related to Doing Business in Mainland China—Uncertainties with respect to the legal system of mainland China and the interpretation and enforcement of laws and regulations of mainland China may affect the legal protections available to you and us.” We may be held liable for information or content displayed on, retrieved from or linked to our platform, or distributed to our users, and government authorities may impose legal sanctions on us, including, in serious cases, suspending or revoking the licenses needed to operate our platform. Our interactive live streaming platform enables users and broadcasters to exchange information and engage in various other online activities. We have required broadcasters, to complete the real-name registration. In August 2018, a notice jointly issued by National Office of Anti-Pornography and Illegal Publication and other five authorities called for the adoption of a real-name registration system for users. In November 2020, a notice issued by the National Radio and Television Administration sets forth real-name registration requirements for certain broadcasters and users. However, there are still considerable uncertainties in the interpretation and enforcement of such notices in actual practice. As such, we are unable to verify the sources of the information posted by our users. In addition, while we have consistently regulated and monitored the information and content displayed on our platform, because a majority of the communications on our platform is conducted in real time, we are unable to examine the content generated by users and broadcasters before they are posted or streamed. Therefore, it is possible that broadcasters and users may engage in illegal, obscene or incendiary conversations or activities, including publishing of inappropriate or illegal content that may be deemed unlawful under laws and regulations of mainland China on our platform. If any content on our platform is deemed illegal, obscene or incendiary, or if appropriate licenses and third-party consents have not been obtained, claims may be brought against us for defamation, libel, negligence, copyright, patent or trademark infringement, other unlawful activities or other theories and claims based on the nature and content of the information delivered on or otherwise accessed through our platform. ​ 28 Table of Contents We have occasionally received fines and been required to disgorge any illegal income earned for certain inappropriate content generated by broadcasters on our platform. Despite our efforts to closely monitor the content on our platform and the actions of our broadcasters, we may be subject to similar fines and penalties in the future. In addition, if the authorities of mainland China find that we have not adequately managed the content on our platform and identify some incompliant practices and activities on our platform, they may impose other legal sanctions on us, including, in serious cases, suspending or revoking the licenses needed to operate our platform and holding us liable for material civil and/or criminal liability. See “Item 4. Information on the Company—B. Business Overview—Government Regulations—Internet Information Services.” Moreover, the costs of compliance may continue to increase when more content is made available on our platform, which may adversely affect our results of operations. Furthermore, the distribution of inappropriate or illegal content by broadcasters may result in the suspension of broadcasters from our platform, and, in some serious cases, the broadcasters may be held criminally liable or be subject to major civil liabilities, which may materially and adversely impact our image, reputation, content offering and our attractiveness to users, thereby negatively impacting our business operations and financial results. In the event popular broadcasters are suspended from our platform as a result of inappropriate or illegal content, we may not be able to recoup or realize the expected returns on our investments made to engage such broadcasters. We may be subject to intellectual property infringement claims or other allegations, which could result in our payment of substantial damages, penalties and fines, removal of relevant content from our platform or seeking license arrangements which may not be available on commercially reasonable terms. Content posted by our users may expose us to allegations by third parties of infringement of intellectual property rights, unfair competition, invasion of privacy, defamation and other violations of third-party rights. For example, we facilitate broadcasters to live stream games on our platform, and, in some cases, we may dictate the games that our broadcasters stream. As a result, we could face copyright infringement claims with respect to online games being streamed live, recorded or made accessible, or songs performed live, recorded or made accessible on our platform. Furthermore, we may not have complete licenses for the copyrights underlying a portion of the content offered by us on our platform, and therefore we may be subject to third-party assertions of infringement or other violations by us of their copyright in connection with such content. The validity, enforceability and scope of protection of intellectual property rights in internet-related industries, are uncertain and still evolving. As we face increasing competition and as litigation becomes a more common way to resolve disputes in mainland China, we face a higher risk of being the subject of intellectual property infringement claims. Under laws and regulations of mainland China, online service providers which provide storage space for users to upload works or links to other services or content could be held liable for copyright infringement under various circumstances, including situations where an online service provider knows or should reasonably have known that the relevant content uploaded or linked to on its platform infringes the copyrights of others and the provider realizes economic benefits from such infringement activities. In particular, there have been cases in mainland China in which courts have found online service providers to be liable for the posting of copyrighted content by users which was accessible from and stored on such providers’ servers. For example, in August 2018, a game publisher filed a suit against us as a co-defendant, claiming that one of the mobile games developed by us infringed the plaintiff’s licensed mobile game. The game publisher sought RMB20 million in damages and requested us to remove each version of such game from our platform. In November 2020, a local court in mainland China in charge of this case passed a first-instance judgment which was unfavorable to us. In this judgment, the local court held that one of the mobile games developed by us infringed the copyright of plaintiff’s licensed mobile game and our actions constitute unfair competition, and therefore we were ordered to pay the game publisher RMB20 million in damages and stop all the actions relative to unfair competition. We filed an appeal to overturn the first-instance judgment and the court handling our appeal ruled in favor of us in June 2023, overturning the first-instance judgment. In December 2023, the game publisher appealed for a retrial of the second-instance judgment, which was dismissed by the relevant court in Novemebr 2025, and the case was finally concluded. We are also subject to the risk of being held liable for unauthorized postings or live performances of copyrighted content by our user, such as live-streaming of games over which we do not have license or copyright. In that event, our business, results of operations and financial conditions may be materially and adversely affected. 29 Table of Contents In addition, we may also be subject to allegations that are associated with the broadcasters and talent agencies on our platform. Even though we prevailed in a number of cases where the court rejected the plaintiff’s claims historically, we cannot assure you that we will always prevail in the cases we have been involved or may be involved. Regardless of the merits of such cases, if the final outcome is unfavorable to us, we may suffer certain damage to our financial position and reputation. In the ordinary course of our business, we have entered, and may in the future enter, into various contractual arrangements with broadcasters, talent agencies, and other participants on our platform. Certain of these arrangements may survive or give rise to obligations or claims after the underlying business relationship has been terminated or has otherwise concluded. Although we have required our users to post only legally compliant and inoffensive materials and have set up screening procedures, our screening procedures may fail to screen out all potentially offensive, unauthorized or non-compliant user-generated content and, even if properly screened, a third party may still find user-generated content posted on our platform offensive and/or infringing and take action against us in connection with such content. In addition, we have entered into revenue-sharing arrangements with broadcasters and talent agencies on our platform, and we cannot assure you that courts in mainland China will not view these broadcasters or talent agencies as our employees or agents, deem us to have control over their activities on our platform and the content they upload or otherwise make available on our platform, determine that we have knowingly uploaded such infringing content on our platform and hold us directly liable for their infringement activities on our platform. We may also face litigations or administrative actions for defamation, negligence or other purported injuries resulting from the content we provide or the nature of our services. Such litigations and administrative actions, with or without merits, may be expensive and time-consuming, resulting in significant diversion of resources and management attention from our business operations, and adversely affect our brand image and reputation. Separately, as our business develops, the cost of carrying out these procedures and obtaining authorization and licenses for the growing content on our platform may increase, which may potentially have material and adverse effects on our results of operations. In addition, while we are currently unaware of any material claims in jurisdictions outside of China alleging infringement of intellectual property rights, we cannot assure you that we will not become subject to such claims in other jurisdictions, such as the United States, by virtue of our ADSs being listed on the NYSE, the ability of users to access our platform from the United States and other jurisdictions, the performance of songs and other content which are subject to copyright and other intellectual property laws of countries outside China, including the United States, the unauthorized usage of intellectual properties by users, the ownership of our ADSs by investors in the United States and other jurisdictions, or the extraterritorial application of foreign law by foreign courts or otherwise. In addition, as a publicly listed company, we are exposed to increased risk of litigation. If an infringement claim brought against us in China, the United States or any other jurisdiction is successful, we may be required to pay substantial statutory penalties or other damages and fines, remove relevant content from our platform or enter into license agreements which may not be available on commercially reasonable terms or at all. Litigation or other claims against us may also subject us to adverse publicity which could harm our reputation and affect our ability to attract and retain broadcasters and talent agencies, which could materially and adversely affect the popularity of our platform and therefore, our business, financial condition, results of operations and prospects may be materially and adversely affected. Our brand image, business, operating results and financial condition may be adversely impacted by user misconduct and misuse of our platform. Since we do not have full control over what broadcasters live stream on our platform and what users communicate on our platform, our platform may be misused or abused by broadcasters or users. We have an internal control system in place to review and monitor live streams and will shut down any streams that may be illegal or inappropriate. However, because the methods and techniques used by those broadcasters or users who may attempt to abuse or misuse our platform evolve and change frequently, some in disguised form, and may not be recognized until a while later, we may be unable to anticipate these misconduct and misuse. We may not be able to identify all such streams and content, or prevent all such content from being posted, in a timely manner, or at all. Moreover, as we have limited control over the illegal or inappropriate behavior of our broadcasters and users, to the extent such behavior is associated with our platform, our ability to protect our brand image and reputation may be limited. Our business and public perception of our brand may be materially and adversely affected. In addition, in response to allegations of illegal or inappropriate activities conducted through our platform or any negative media coverage about us, government authorities of mainland China may intervene and hold us liable for non-compliance with laws and regulations in mainland China concerning the dissemination of information on the internet or others and subject us to administrative penalties, including confiscation of income and fines, or other sanctions, such as requiring us to restrict or discontinue some of the broadcasters, or features and services provided on our platform. Furthermore, certain behaviors of broadcasters or the talent agencies they belong to, such as tax evasion, that are not directly associated with our platform but cause the broadcasters to be banned from online broadcasting or other consequences, may nevertheless affect our brand. We may also be subject to criminal liability if we are involved in criminal offenses on our platform. 30 Table of Contents As a result, our business may suffer and our user base, revenues and profitability may be materially and adversely affected, and the price of our ADSs may decline. If we fail to maintain and enhance our brand or if we incur excessive expenses in this effort, our business, results of operations and prospects may be materially and adversely affected. We believe that maintaining and enhancing our brand is of significant importance to the success of our business. A well-recognized brand is important to increasing the number of users and the level of engagement of our users and enhancing our attractiveness to advertisers. Since we operate in a highly competitive market, brand maintenance and enhancement directly affect our ability to maintain our market position. Although we have developed brand partly through word-of-mouth referrals, as we develop, we may conduct various marketing and brand promotion activities using various methods to continue promoting our brand. We cannot assure you, however, that these activities will be successful or that we will be able to achieve the brand promotion effect we expect. In addition, any negative publicity in relation to our products, services or operations, regardless of its veracity, could harm our brands and reputation. We have sometimes received, and expect to continue to receive, complaints from users such as complaints regarding the quality of the products and services we offer, minors’ use of gaming products and livestreaming services, and misconduct by broadcasters, talent agencies, and other content creators. Negative publicity or public complaints may harm our reputation, and if complaints against us are not addressed to their satisfaction, our reputation and our market position could be significantly harmed, which may materially and adversely affect our business, results of operations and prospects. We may incur significant managerial, financial and operational costs and expenses in dealing with the negative publicity or public complaints. We use certain operating metrics to evaluate the performance of our business, and real or perceived inaccuracies in such metrics, or changes in our metric reporting practices, including discontinuation of certain operating metrics, may harm our reputation and negatively affect our business. We have used certain operating metrics, such as MAUs and paying users, to evaluate the performance of our business. As our business evolves and we further expand into game-related services and other new initiatives, the relevance and importance of our existing operating metrics may change. Certain metrics that were previously considered as key indicators of our performance, such as MAUs and paying users, may no longer accurately reflect our business or be meaningfully related to our financial and operational performance. We may, from time to time, modify the definition of our existing metrics, adopt new metrics to better reflect our business developments, or cease to track or disclose certain metrics that we believe are no longer representative of our performance. Any such change or discontinuation, including any decision to cease the regular disclosure of MAUs and paying users, may lead to confusion among investors and analysts, reduce analyst coverage, alter the valuation methodologies applied to our business, or otherwise adversely affect the market price of our ADSs. For example, starting from 2026, we have decided to cease the regular disclosure of MAUs and paying users, as we believe our current and future strategic progress can be more meaningfully reflected through our overall financial and operational performance. Our operating metrics are calculated using internal company data that have not been independently verified. While these numbers are based on what we believe to be reasonable calculations for the applicable periods of measurement, there are inherent challenges in measuring these metrics across our large user base. For example, our MAUs may not accurately reflect the actual number of people who accessed our platforms and related services, as it is possible that some people may use more than one device, some people may share one device with others, and some people may access our platform through multiple channels. Our measures of operating metrics may differ from estimates published or adopted by third parties, including but not limited to users, business partners, market research institutions, investors and media, or from similarly titled metrics used by our competitors or other companies in the relevant industries due to differences in methodology and assumptions. If these third parties do not perceive our operating metrics to be accurate representations of operations, or if we discover material inaccuracies in our operating metrics, our brand value and reputation may be materially harmed, and our business and operating results may be negatively impacted. If operating metrics we have disclosed are later found to be inaccurate, we may also face potential lawsuits, regulatory scrutiny, or disputes. 31 Table of Contents Our business is highly dependent on the proper functioning and improvement of our information technology systems and infrastructure. Our business and operating results may be harmed by service disruptions, cybersecurity-related threats or by our failure to timely and effectively scale up and adjust our existing technology and infrastructure. The popularity of our platform and services and our ability to further monetize user base depend on our ability to adapt to rapidly changing technologies as well as our ability to continually innovate in response to evolving consumer demands and expectations and intense market competition. Our ability to provide a superior user experience on our platform depends on the continuous and reliable operation of our IT systems. We may not be able to procure sufficient bandwidth in a timely manner or on acceptable price and other terms or at all. Failure to do so may significantly impair user experience on our platform, decrease the overall effectiveness of our platform to users, broadcasters, talent agencies and advertisers, and increase costs and expenses. Our IT systems and content delivery network are vulnerable to damage or interruption as a result of fires, floods, earthquakes, power losses, telecommunications failures, undetected errors in software, computer viruses, hacking and other attempts to harm our IT systems. We have experienced, and may in the future experience, service disruptions, outages and other performance problems due to a variety of factors, including infrastructure changes and cybersecurity-related threats as follows: ● our technology, system, networks and our users’ devices have been subject to, and may continue to be the target of, cyber-attacks, computer viruses, malicious code, phishing attacks or information security breaches that could result in an unauthorized release, gathering, monitoring, misuse, loss or destruction of confidential, proprietary and other information of ours, our employees or sensitive information provided by our users, or otherwise disrupt our, our users’ or other third parties’ business operations; ● we periodically encounter attempts to create false accounts or use our platform to send targeted and untargeted spam messages to our users, or take other actions on our platform for purposes such as spamming or spreading misinformation, and we may not be able to repel spamming attacks; ● the use of encryption and other security measures intended to protect our systems and confidential data may not provide absolute security, and losses or unauthorized access to or releases of confidential information may still occur; ● our security measures may be breached due to employee error, malfeasance or unauthorized access to sensitive information by our employees, who may be induced by outside third parties, and we may not be able to anticipate any breach of our security or to implement adequate preventative measures; and ● we may be subject to information technology system failures or network disruptions caused by natural disasters, accidents, power disruptions, telecommunications failures, acts of terrorism or war, computer viruses, physical or electronic break-ins, or other events or disruptions. Disruptions, failures, unscheduled service interruptions or a decrease in connection speeds could damage our reputation and cause our users, content providers and advertisers to migrate to our competitors’ platforms. If we experience frequent or constant service disruptions, whether caused by failures of our own IT systems or those of third-party service providers, our user experience may be negatively affected, which in turn may have a material and adverse effect on our reputation and business. We may not be successful in minimizing the frequency or duration of service interruptions. As our offerings become more comprehensive and our users generate more content on our platform, we may be required to expand and adjust our technology and infrastructure to continue to reliably store and process content. It may become increasingly difficult to maintain and improve the performance of our platform, particularly during peak usage times, as our services become more complex and the demands on our computing and storage resources increase. 32 Table of Contents We use third-party services and technologies in connection with our business, and any disruption to the provision of these services and technologies to us could result in disruptions to our business, negative publicity, a slowdown in the growth of our users or even a decline of our user base and engagement, which could materially and adversely affect our business, financial condition and results of operations. Our business partially depends on services provided by, and relationships with, various third parties. Some third-party software we use in our operations is currently publicly available, free of charge. If the owner of any such software decides to charge users or no longer makes the software publicly available, we may need to incur significant costs to obtain licensing, find replacement software or develop it on our own. If we are unable to obtain licensing, find or develop replacement software at a reasonable cost, or at all, our business and operations may be adversely affected. ​ 33 Table of Contents We rely on third-party mobile application and PC application distribution channels such as Apple’s app store, various Android application stores, and websites to distribute our mobile apps and PC clients to users and broadcasters. We expect that a substantial number of downloads of our mobile apps and PC clients will continue to be derived from these distribution channels. As such, the promotion, distribution and operation of our mobile apps and PC clients are subject to such distribution platforms’ standard terms and policies for application developers, which are subject to the interpretation of, and frequent changes by, these distribution channels. If Apple’s app store or any other major distribution channel interprets or changes its standard terms and conditions in a manner that is detrimental to us, removes our mobile apps or PC clients from their channels, or even suspends or terminates its existing relationship with us, our business, financial condition and results of operations may be materially and adversely affected. In addition, we process transactions of many of our services through third-party online payment systems. Most of our users use online payment systems, such as WeChat Pay and Alipay, to make payments for various products and services on our platform. If any of these third-party online payment systems suffer from security breaches, users may lose confidence in such payment systems and refrain from purchasing our products and services online, in which case our results of operations would be negatively impacted. See “—The security of operations of, and fees charged by, third-party online payment platforms may have a material adverse effect on our business and results of operations.” Furthermore, such third-party online payment systems are subject to anti-money laundering obligations under applicable anti-money laundering laws and regulations in mainland China, which require them to comply with certain anti-money laundering requirements, including the establishment of a customer identification procedure, the monitoring and reporting of suspicious transactions, the preservation of customer information and transaction records, and the provision of assistance to the public security department and judicial authority in investigations and proceedings in relation to anti-money laundering matters. If a third-party payment system fails to perform its anti-money laundering obligations, it may be subject to fines or other proceedings in accordance with laws and regulations. If any of such third-party payment system fails to comply with applicable anti-money laundering laws and regulations, our reputation could suffer and we could become subject to regulatory intervention, which could have a material and adverse effect on our business, financial condition, results of operations and prospects. We exercise no control over the third parties with whom we have business arrangements. If such third parties increase their prices, fail to provide their services effectively, terminate their service or agreements or discontinue their relationships with us, we could suffer service interruptions, reduced revenues or increased costs, any of which may have a material adverse effect on our business, financial condition and results of operations. We may extend credit to some of our customers, which could negatively affect our operating cash flow and financial performance. We may extend credit to some of our customers such as our advertising clients and business partners on game-related services based on our business needs. Offering credit may lead to increased sales and customer loyalty, but it may also expose us to the risk of late payment or defaults, which can strain our cash flow and reduce our liquidity. Accurately assessing the creditworthiness of customers is another challenge. Additionally, managing credit accounts requires administrative resources and can lead to higher operational costs. Economic downturns or shifts in market conditions may further exacerbate these risks. Our operations depend on the performance of the internet infrastructure and fixed telecommunications networks in mainland China, which is in large part maintained by state-owned operators. Almost all access to the internet in mainland China is maintained through state-owned telecommunication operators under the administrative control and regulatory supervision of the Ministry of Industry and Information Technology. Moreover, we primarily rely on a limited number of telecommunication service providers to provide us with data communications capacity through local telecommunications lines and internet data centers to host our servers. We have limited access to alternative networks or services in the event of disruptions, failures or other problems with internet infrastructure in mainland China or the fixed telecommunications networks provided by telecommunication service providers. Web traffic in mainland China has experienced significant growth during the past few years. With the expansion of our business, we may be required to upgrade our technology and infrastructure to keep up with the increasing traffic on our platform. We cannot assure you that the internet infrastructure and the fixed telecommunications networks in mainland China will be able to support the demands associated with the continued growth in internet usage. If we cannot increase our capacity to deliver our online services, we may not be able to accommodate the increases in traffic from expanding user base, and the adoption of our services may be hindered, which could adversely impact our business. 34 Table of Contents In addition, we have no control over the costs of the services provided by telecommunication service providers. If the prices we pay for telecommunications and internet services rise significantly, our results of operations may be materially and adversely affected. Furthermore, if internet access fees or other charges to internet users increase, some users may be prevented from accessing the mobile internet and thus cause the growth of mobile internet users to decelerate. Such deceleration may adversely affect our ability to continue to expand our user base. User reach and engagement depend upon effective interoperation with mobile operating systems, networks, mobile devices and standards that we do not control. We make our services available across a variety of mobile operating systems and devices. We are dependent on the interoperability of our services with popular mobile devices and mobile operating systems that we do not control, such as Android and iOS. Any changes in such mobile operating systems or devices that degrade the functionality of our services or give preferential treatment to competitive services could adversely affect usage of our services. In order to deliver high-quality services, it is important that our services work well across a range of mobile operating systems, networks, mobile devices and standards that we do not control. We may not be successful in developing relationships with key participants in the mobile industry or in developing services that operate effectively with these operating systems, networks, devices and standards. In the event that it is difficult for our users to access and use our services, particularly on their mobile devices, our user reach and user engagement could be harmed, and our business and operating results could be adversely affected. Spammers and malicious software and applications may affect user experience, which could reduce our ability to attract users and advertisers and materially and adversely affect our business, financial condition and results of operations. Spammers may use our platform to send spam messages to users, which may affect user experience. As a result, our users may reduce using our products and services or stop using them altogether. In spamming activities, spammers typically create multiple user accounts for the purpose of sending a high volume of repetitive messages. Although we attempt to identify and delete accounts created for spamming purposes, we may not be able to effectively eliminate all spam messages from our platform in a timely fashion. Any spamming activities could have a material and adverse effect on our business, financial condition and results of operations. In addition, malicious software and applications may interrupt the operations of our mobile apps, websites, or PC clients and pass on such malware to our users which could adversely hinder user experience. Although we have been successfully blocking these attacks in the past, we cannot guarantee that this will always be the case. In the event that our users experience a malware attack by using our platform, they may associate the malware with our mobile apps, websites, or PC clients, which could materially and adversely affect our reputation, business, and results of operations. The security of operations of, and fees charged by, third-party online payment platforms may have a material adverse effect on our business and results of operations. Currently, most of our users use third-party online payment systems to make payments for various products and services on our platform. In all these online payment transactions, secured transmission of confidential information such as paying users’ credit card numbers and personal information over public networks is essential to maintaining consumer confidence. We do not have control over the security measures of our third-party online payment vendors. Any security breaches of the online payment systems that we use could expose us to litigation and possible liability for failing to secure confidential customer information and could, among other things, damage our reputation and the perceived security of all of the online payment systems that we use. If a well-publicized internet or mobile network security breach were to occur, users may become reluctant to purchase our products and services even if the publicized breach did not involve payment systems or methods used by us. In addition, there may be billing software errors that would damage customer confidence in these online payment systems. If any of the above were to occur and damage our reputation or the perceived security of the online payment systems we use, we may lose paying users and users may be discouraged from purchasing our products and services, which may have a material adverse effect on our business. In addition, there are currently only a limited number of reputable third-party online payment systems in mainland China that meet our operational and compliance requirements. If any of these major payment systems decides to cease to provide services to us, or significantly increase the percentage they charge us for using their payment systems for our products and services, our results of operations may be materially and adversely affected. 35 Table of Contents Concerns or claims about the collection and use of personal data could damage our reputation and deter current and potential users from using our products and services, which could materially and adversely affect our business, financial condition and results of operations. Concerns or claims about our practices with regard to the collection, use or disclosure of personal information or other privacy-related matters, even if unfounded, could damage our reputation and operating results. We apply strict management and protection for any information provided by users and, under our privacy policy, without our users’ prior consent, we will not provide any of our users’ personal information to any unrelated third party. While we strive to comply with our privacy guidelines as well as all applicable data protection laws and regulations, any failure or perceived failure to comply may result in proceedings or actions against us by government entities or others, and could damage our reputation. See “—Our business generates and processes a large amount of data, and we are required to comply with laws of mainland China and other applicable laws relating to privacy and cybersecurity. The improper use or disclosure of data could have a material and adverse effect on our business and prospects.” User and regulatory attitudes towards privacy are evolving, and future regulatory or user concerns about the extent to which personal information is used or shared with advertisers or others may adversely affect our ability to share certain data with advertisers or others, which may limit certain methods of targeted advertising or our cooperation with other business partners. Concerns about the security of personal data could also lead to a decline in general internet usage, which could lead to lower registered, active or paying user numbers on our platform. For example, if the government authorities of mainland China require real-name registration system for users of our platform with stricter and higher standards, the growth of our user numbers may slow down or the numbers may even decline, and our business, financial condition and results of operations may be adversely affected. See “—Risks Related to Doing Business in Mainland China—We may be adversely affected by the complexity, uncertainties and changes in the regulation of mainland China relating to the internet industry and companies.” A significant reduction in registered, active or paying user numbers could lead to lower revenues, which could have a material and adverse effect on our business, financial condition and results of operations. Third parties may register trademarks or domain names or purchase internet search engine keywords that are similar to our trademarks, brands or websites, or misappropriate our data and copy our platform, all of which could cause confusion to our users, divert online customers away from our products and services or harm our reputation. Competitors and other third parties may purchase (i) trademarks that are similar to our trademarks and (ii) keywords that are confusingly similar to our brands or websites in internet search engine advertising programs and in the header and text of the resulting sponsored links or advertisements in order to divert potential customers from us to their websites. Preventing such unauthorized use is inherently difficult. If we are unable to prevent such unauthorized use, competitors and other third parties may continue to drive potential online customers away from our platform to competing, irrelevant or potentially offensive platform, which could harm our reputation and cause us to lose revenue. From time to time, third parties have misappropriated our data through scraping our platform, robots or other means and aggregated this data on their platforms with data from other companies. In addition, “copycat” platforms or apps have misappropriated data on our platform, implanted Trojan viruses in user PCs to steal user data from our platform and attempted to imitate our brand or the functionality of our platform. When we became aware of such platform, we employed technological and legal measures in an attempt to halt their operations. However, we may not be able to detect all such platforms in a timely manner and, even if we could, technological and legal measures may be insufficient to stop their operations. In those cases, our available remedies may not be adequate to protect us against such platforms. Regardless of whether we can successfully enforce our rights against these platforms, any measures that we may take could require significant financial or other resources from us. Those platforms may also lure away some of our users or advertisers or reduce our market share, causing material and adverse effects to our business operations. We may not be able to prevent others from unauthorized use of our intellectual property, which could harm our business and competitive position. We regard our trademarks, service marks, patents, domain names, trade secrets, proprietary technologies and similar intellectual property as critical to our success. We rely on trademark and patent law, trade secret protection and confidentiality and license agreements with our employees and others to protect our proprietary rights. We have invested significant resources to develop our own intellectual property and acquire licenses to use and distribute the intellectual property of others on our platform. Failure to maintain or protect these rights could harm our business. In addition, any unauthorized use of our intellectual property by third parties may adversely affect our current and future revenues and our reputation. 36 Table of Contents Policing unauthorized use of proprietary technology is difficult and expensive. We rely on a combination of patent, copyright, trademark and trade secret laws and restrictions on disclosure to protect our intellectual property rights. Despite our efforts to protect our proprietary rights, third parties may attempt to copy or otherwise obtain and use our intellectual property or seek court declarations that they do not infringe upon our intellectual property rights. Monitoring unauthorized use of our intellectual property is difficult and costly, and we cannot assure you that the steps we have taken will prevent misappropriation of our intellectual property. From time to time, we may have to resort to litigation to enforce our intellectual property rights, which could result in substantial costs and diversion of our resources. As our patents may expire and may not be extended, our patent applications may not be granted and our patent rights may be contested, circumvented, invalidated or limited in scope, our patent rights may not protect us effectively. In particular, we may not be able to prevent others from developing or exploiting competing technologies, which could have a material and adverse effect on our business operations, financial condition and results of operations. As of March 31, 2026, we have 1,124 registered patents and 371 patent applications pending in mainland China. For our pending application, we cannot assure you that we will be granted patents pursuant to our pending applications. Even if our patent applications succeed, it is still uncertain whether these patents will be contested, circumvented or invalidated in the future. In addition, the rights granted under any issued patents may not provide us with sufficient protection or competitive advantages. The claims under any patents that issue from our patent applications may not be broad enough to prevent others from developing technologies that are similar or that achieve results similar to ours. It is also possible that the intellectual property rights of others will bar us from licensing and from exploiting any patents that issue from our pending applications. There are numerous U.S. and foreign issued patents and pending patent applications owned by others in the fields in which we have developed and are developing our technology. These patents and patent applications might have priority over our patent applications and could subject our patent applications to invalidation. Finally, in addition to those who may claim priority, any of our existing or pending patents may also be challenged by others on the basis that they are otherwise invalid or unenforceable. Some of our products and services contain open-source software, which may pose particular risks to our proprietary software, products and services in a manner that negatively affects our business. We use open-source software in some of our services and will continue to use open-source software in the future. There is a risk that open-source software licenses could be construed in a manner that imposes unanticipated conditions or restrictions on our ability to provide or distribute our services. Additionally, we may face claims from third parties claiming ownership of, or demanding release of, the open-source software or derivative works that we developed using such software. These claims could result in litigation and could require us to make our software source code freely available, purchase a costly license or cease offering the implicated products or services unless and until we can re-engineer them to avoid infringement. This re-engineering process could require significant additional research and development resources, and we may not be able to complete it successfully. Furthermore, because any software source code we contribute to open-source projects is publicly available, our ability to protect our intellectual property rights with respect to such software source code may be limited or lost entirely. As a result, we may be unable to prevent our competitors or others from using such software source code contributed by us. Our business is sensitive to economic conditions. A severe or prolonged downturn in the global economy could materially and adversely affect our business, financial condition and results of operations. The global macroeconomic environment faces numerous challenges. The Russia-Ukraine conflict, the Hamas-Israel conflict, the conflict in the Persian Gulf and surrounding areas as far west as Israel and Lebanon, and the restrictions at various times on shipping through the straits of Hormuz and the Red Sea have heightened geopolitical tensions across the world. The impact of the regional conflicts may create disruptions and uncertainties to oil prices, inflation, the international finance market and global economy. There also have been concerns about the relationship between China and other countries, which may potentially have economic effects. In particular, there is significant uncertainty about the future relationship between the United States and China with respect to a wide range of issues including trade policies, treaties, government regulations, investment policies and tariffs. Any severe or prolonged slowdown in the global or Chinese economy may materially and adversely affect our business, results of operations and financial condition. 37 Table of Contents Future strategic alliances or acquisitions may have a material and adverse effect on our business, reputation and results of operations. We may enter into strategic alliances, including joint ventures or minority equity investments, with various third parties to further our business purpose from time to time. These alliances could subject us to a number of risks, including risks associated with sharing proprietary information, non-performance by the third party and increased expenses in establishing new strategic alliances, any of which may materially and adversely affect our business, or our investments may be subject to loss. We may have limited ability to monitor or control the actions of these third parties and, to the extent any of these strategic third parties experiences negative publicity or harm to their reputation from events relating to their business, we may also suffer negative publicity or harm to our reputation by virtue of our association with any such third party. In addition, when appropriate opportunities arise, we may acquire additional assets, products, technologies or businesses that are complementary to our existing business. In addition to possible shareholders’ approval, we may also have to obtain approvals and licenses from the government authorities for the acquisitions and to comply with any applicable laws and regulations of mainland China, which could result in increased delay and costs, and may derail our business strategy if we fail to do so. Furthermore, past and future acquisitions and the subsequent integration of new assets and businesses into our own require significant attention from our management and could result in a diversion of resources from our existing business, which in turn could have an adverse effect on our business operations. Acquired assets or businesses may not generate the operational and financial results we expect. Acquisitions could result in the use of substantial amounts of cash, potentially dilutive issuances of equity securities, the occurrence of significant goodwill impairment charges, assets impairment loss, amortization expenses for other intangible assets and exposure to potential unknown liabilities of the acquired business. Moreover, the costs of identifying and consummating acquisitions may be significant. If we are deemed to be an investment company under the United States Investment Company Act of 1940, as amended, it may be required to institute burdensome compliance requirements and its activities may be restricted. We do not believe that we are an “investment company” and we do not intend to become registered as an “investment company” under the United States Investment Company Act of 1940, as amended, or the Investment Company Act. Certain of our assets and our future holdings, including long-term and short-term time deposits, may be deemed to be “investment securities” within the meaning of the Investment Company Act. Under the Investment Company Act, a company is deemed to be an “investment company” if it (i) is engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting, owning, holding or trading in securities or (ii) owns or proposes to acquire investment securities having a value exceeding 40% of the value of the company’s total assets (exclusive of government securities and cash items) on an unconsolidated basis. On a consolidated basis, a significant portion of our present assets as of December 31, 2025 consists of time deposits held for cash management purposes, which may be deemed to be “investment securities,” rather than cash items, within the meaning of the Investment Company Act. However, we do not hold ourselves out as being primarily engaged, or proposing to engage primarily, in the business of investing, reinvesting or trading in securities. Rather, we are primarily engaged in the business of providing online live streaming platforms and related services. We seek to conduct our operations so that we do not meet the definition of an “investment company” under the Investment Company Act. Doing so may require us to forego potential future acquisitions of interests in companies that may be deemed to be “investment securities” within the meaning of the Investment Company Act. If we are unable to structure or operate our business in a manner that avoids investment company status under the Investment Company Act, we may be deemed to be an investment company within the meaning of the Investment Company Act. As a foreign private issuer, we would not be eligible to register under the Investment Company Act unless the SEC issued an order permitting us to do so. As a result, if we are deemed to be an investment company within the meaning of the Investment Company Act, we would either have to obtain exemptive relief from the SEC or dispose of investment securities in order to fall outside the definition of an investment company. Failure to avoid being deemed an investment company under the Investment Company Act, coupled with our inability as a foreign private issuer to register under the Investment Company Act, could make us unable to comply with our reporting obligations as a public company in the United States and lead to our being delisted from the New York Stock Exchange, which would materially and adversely affect the liquidity and value of the ADSs. We would also be unable to raise capital through the sale of securities in the United States or to conduct business in the United States. Moreover, if we were deemed to be an investment company under the Investment Company Act and not exempted from the application of the Investment Company Act, contracts we enter into in violation of, or the performance of which entails a violation of, the Investment Company Act, including any securities sold in the United States or to U.S. persons, may not be enforceable against us. In addition, we may be subject to SEC enforcement action or purported class action lawsuits for alleged violations of U.S. securities laws. Defending ourselves against any such enforcement action or lawsuits would require significant attention from our management and divert resources from our existing businesses and could materially and adversely affect our business, results of operations, and financial condition. 38 Table of Contents Failure to maintain effective internal control over financial reporting could have a material and adverse effect on the trading price of our ADSs. We are subject to the reporting obligations under the U.S. securities laws. The SEC, as required by Section 404 of the Sarbanes-Oxley Act, adopted rules requiring every public company to include a report from management on the effectiveness of such company’s internal control over financial reporting in its annual report on Form 20-F. In addition, the independent registered public accounting firm must report on the effectiveness of such company’s internal control over financial reporting. If we fail to maintain effective internal control over financial reporting, we will not be able to conclude and our independent registered public accounting firm will not be able to report that we have effective internal control over financial reporting in accordance with the Sarbanes-Oxley Act of 2002 in our future annual report on Form 20-F covering the fiscal year in which this failure occurs. Effective internal control over financial reporting is necessary for us to produce reliable financial reports. Any failure to maintain effective internal control over financial reporting could result in the loss of investor confidence in the reliability of our financial statements, which in turn could have a material and adverse effect on the trading price of our ADSs. Furthermore, we may need to incur additional costs and use additional management and other resources as our business and operations develop or in an effort to remediate any significant control deficiencies that may be identified in the future. We are subject to changing laws and regulations regarding regulatory matters, corporate governance and public disclosure that have increased both our costs and the risk of non-compliance. We are subject to rules and regulations by various governing bodies, including, for example, the SEC, which is charged with the protection of investors and the oversight of companies whose securities are publicly traded, and the various regulatory authorities in mainland China and the Cayman Islands, and to new and evolving regulatory measures under applicable law. Our efforts to comply with new and changing laws and regulations have resulted in and are likely to continue to result in, increased general and administrative expenses and a diversion of management time and attention from revenue-generating activities to compliance activities. For example, on December 29, 2023, the Standing Committee of the National People’s Congress promulgated the PRC Company Law, which came into effect on July 1, 2024 and superseded the previous PRC Company Law. The changes are considerable in many respects and will have profound implications for companies incorporated in China, such as the five-year capital contribution timeframe for shareholders of limited liability companies to make their capital contributions in full. On July 1, 2024, the State Council issued the Provisions of the State Council on Implementing the Registered Capital Registration Management System under the PRC Company Law, and on December 20, 2024, the State Administration for Market Regulation promulgated the Implementing Measures for the Administration of Company Registration (effective on February 10, 2025), both of which further strengthen the registration management of companies’ registered capital. See “Item 4. Information on the Company—B. Business Overview—Government Regulations—Regulations on Corporate Governance.” We will closely monitor the legislative developments concerning the PRC Company Law and its implementation measures and ensuring a prompt evaluation of any potential implications for our operations. In response to these changes, we may need to devote significant efforts and resources to adapt and conform our PRC corporate practices to the new regulatory regime. Moreover, because these laws, regulations and standards are subject to varying interpretations, their application in practice may evolve over time as new guidance becomes available. This evolution may result in continuing uncertainty regarding compliance matters and additional costs necessitated by ongoing revisions to our disclosure and governance practices. If we fail to address and comply with these regulations and any subsequent changes, we may be subject to penalties and our business may be harmed. Our business generates and processes a large amount of data, and we are required to comply with laws of mainland China and other applicable laws relating to privacy and cybersecurity. The improper use or disclosure of data could have a material and adverse effect on our business and prospects. Our business generates and processes a large quantity of data. We face risks inherent in handling and protecting large volume of data. In particular, we face a number of challenges relating to data from transactions and other activities on our platforms, including: ● protecting the data in and hosted on our system, including against attacks on our system by outside parties or fraudulent behavior or improper use by our employees; ● addressing concerns related to privacy and sharing, safety, security and other factors; and complying with applicable laws, rules and regulations relating to the collection, use, storage, transfer, disclosure and security of personal information, including any requests from regulatory and government authorities relating to these data. 39 Table of Contents In general, we expect that data security and data protection compliance will receive greater attention and focus from regulators, both domestically and globally, as well as attract continued or greater public scrutiny and attention going forward, which could increase our compliance costs and subject us to heightened risks and challenges associated with data security and protection. If we are unable to manage these risks, we could become subject to penalties, including fines, suspension of business and revocation of required licenses, and our reputation and results of operations could be materially and adversely affected. The regulatory and enforcement regime in mainland China with regard to data security and data protection is evolving and may be subject to different interpretations or significant changes. See “Item 4. Information on the Company—B. Business Overview—Government Regulations—Regulations on Internet Content and Information Security” and “Item 4. Information on the Company—B. Business Overview—Government Regulations—Privacy Protection.” Many of the data-related legislations are relatively new and certain concepts thereunder remain subject to interpretation by the regulators. If any data that we possess belongs to data categories that are subject to heightened scrutiny, we may be required to adopt stricter measures for protection and management of such data. On December 28, 2021, the Cyberspace Administration of China, the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, the Ministry of National Security, the Ministry of Finance, the Ministry of Commerce, the People’s Bank of China, the State Administration for Market Regulation, the National Radio and Television Administration, the China Securities Regulatory Commission, the National Administration of State Secrets Protection and the State Cryptography Administration jointly released the Cybersecurity Review Measures, which became effective on February 15, 2022. In September 2024, the State Council promulgated the Regulations on the Management of Network Data Security, or the Data Security Regulations, which is applicable to network data processing activities and the security supervision and administration thereof conducted within the territory of the PRC and took effect on January 1, 2025. On November 22, 2025, the Cyberspace Administration of China, and the Ministry of Public Security promulgated the Public Comments Solicitation for the Provisions on Personal Information Protection for Large Online Platforms (Draft for Comment), which provides that the national cyberspace administration, together with the Ministry of Public Security under the State Council and other relevant departments, shall formulate and publish a catalogue of large online platforms and update it dynamically, and a large network platform service provider is a network data processor providing large online platform services. As of the date of this annual report, the Cybersecurity Review Measures and the Regulations on the Management of Network Data Security remain unclear on whether relevant requirements will be applicable to companies that are already listed in the United States, such as us, if we were to pursue another listing outside mainland China. In addition, there is uncertainty regarding whether we would be classified as a critical information infrastructure operator under the Regulations on Protection of Critical Information Infrastructure. We cannot predict the impact and interpretations of these regulations, if any, at this stage, and we will closely monitor and assess any development in the rule-making process. If the Cybersecurity Review Measures and the enacted version of the Regulations on the Management of Network Data Security mandate clearance of cybersecurity review and other specific actions to be taken by issuers like us, we face uncertainties as to whether these additional procedures can be completed by us timely, or at all, which may delay or disallow our future listing (should we decide to pursue them), subject us to government enforcement actions and investigations, fines, penalties, suspension of our non-compliant operations, or removal of our apps from application stores, and materially and adversely affect our business and results of operations. As of the date of this annual report, we have not been involved in any formal investigations on cybersecurity review made by the Cyberspace Administration of China on such basis. In addition, if we are classified as a critical information infrastructure operator by any government authorities, we may be subject to obligations beyond those already met under the cybersecurity laws and regulations of mainland China. As of the date of this annual report, we have not been informed that we are a critical information infrastructure operator by any government authorities. In general, compliance with the existing laws and regulations of mainland China, as well as any additional laws and regulations enacted by regulatory bodies of mainland China in the future, related to data security and personal information protection, may involve ongoing efforts to meet evolving requirements, and any deficiencies in compliance may result in negative publicity, which could harm our reputation and business operations. There are also uncertainties with respect to how these laws and regulations will be implemented and interpreted in practice. On June 11, 2021, the Cyberspace Administration of China issued a notice requiring 129 named apps to rectify certain non-compliance related to collection of personal information, including our Huya Live app which was named for “collecting personal information that is not related to the functioning of the app.” We submitted a rectification report to the authorities on July 1, 2021. On July 19, 2021. The Ministry of Industry and Information Technology issued a notice requiring 145 apps named for infringement of users’ rights to complete rectification before July 26, 2021, including our Huya Live app which was named for “deceiving, misleading, and forcing users” by way of pop-up ads when users log onto the platform. We submitted a rectification report to the authorities on July 22, 2021. We have taken actions in response to the identified issues and completed the rectification as required. However, we cannot guarantee that we will not be involved in future regulatory actions and be subject to penalties as a result. 40 Table of Contents In addition, regulatory authorities around the world have adopted or are considering a number of legislative and regulatory proposals concerning data protection. If these legislative and regulatory proposals are adopted, along with the uncertain interpretations and application thereof, they could potentially lead to fines or an order mandating changes to our data practices and policies, which could have an adverse effect on our business and results of operations. The European Union General Data Protection Regulation, which came into effect on May 25, 2018, includes operational requirements for companies that receive or process personal data of residents of the European Economic Area. The European Union General Data Protection Regulation establishes requirements applicable to the processing of personal data, affords data protection rights to individuals and imposes penalties for serious data breaches. Individuals also have a right to compensation under the European Union General Data Protection Regulation for financial or non-financial losses. If residents of the European Economic Area access our website or our mobile platform and input protected information, we may become subject to provisions of the European Union General Data Protection Regulation. We may need additional capital, and we may be unable to obtain such capital in a timely manner or on acceptable terms, or at all. Furthermore, our future capital needs may require us to sell additional equity or debt securities that may dilute our shareholders or introduce covenants that may restrict our operations or our ability to pay dividends. To support our business development and remain competitive, we may require additional capital from time to time for our daily operation. For example, in November 2020, we entered into an agreement to obtain the usage right to a piece of land in Guangdong Province on which we are in the process of developing office space, which requires a significant amount of capital. See “Item 4. Information on the Company—D. Property, Plants and Equipment.” Our ability to obtain additional capital is subject to a variety of uncertainties, including: ● our market position and competitiveness in the live streaming service, in particular, game live streaming, and our ability to successfully expand into game-related services; ● our future profitability, overall financial condition, results of operations and cash flows; ● general market conditions for capital raising activities by game, live streaming and other internet and content companies in mainland China and internationally; ● foreign currency restrictions; and ● economic, political and other conditions in mainland China and internationally. We may be unable to obtain additional capital in a timely manner or on acceptable terms or at all. In addition, our future capital needs and other business reasons could require us to sell additional equity or debt securities or obtain a credit facility. The sale of additional equity or equity-linked securities could dilute our shareholders. The incurrence of indebtedness would result in increased debt service obligations and could result in operating and financing covenants that would restrict our operations or our ability to pay dividends to our shareholders. Furthermore, we may be adversely affected by bank failures or other crises in the financial industry. We have funds in several banks, and if a bank or other financial institution at which a portion of our cash, cash equivalents or deposits is held fails in the future, our ability to access our existing cash, cash equivalents and deposits may be impacted and we may need to obtain capital from elsewhere. Our business and financial condition may be materially adversely affected as a result. We face risks related to natural disasters, health epidemics, and other outbreaks, which could significantly disrupt our operations. Our business could be adversely affected by the effects of epidemics. In recent years, there have been outbreaks of epidemics in mainland China and globally. Our business operations could be disrupted if one of our employees is suspected of having contracted COVID-19, H1N1 flu, avian flu, Ebola or another epidemic, since it could require our employees to be quarantined or our offices to be disinfected. Our results of operations could be adversely affected to the extent that the outbreak has any negative impact on the Chinese and global economy in general and the Chinese and global mobile internet, live streaming, game and e-sports industries in particular. Additionally, any outbreaks of other health epidemics could pose challenges on us in navigating potential headwinds, affecting our business, financial condition, and results of operations. 41 Table of Contents We are also vulnerable to natural disasters, extreme weather (including as a result of the global climate change) and other calamities. It is possible that we may be unable to recover certain data in the event of a server failure. We cannot assure you that any backup systems will be adequate to protect us from the effects of fire, floods, typhoons, earthquakes, power loss, telecommunications failures, sabotages, war, riots, terrorist attacks or similar events. Any of the foregoing events may give rise to server interruptions, breakdowns, system failures, technology platform failures or internet failures, which could cause the loss or corruption of data or malfunctions of software or hardware as well as adversely affect our ability to provide services on our platform. We have no business insurance coverage, so that any uninsured occurrence of business disruption may result in substantial costs to us and the diversion of our resources, which could have an adverse effect on our results of operations and financial condition. Insurance companies in mainland China currently do not offer as extensive an array of insurance products as insurance companies do in more developed economies. We do not have any business liability or disruption insurance to cover our operations. We have determined that the costs of insuring for these risks and the difficulties associated with acquiring such insurance on commercially reasonable terms make it impractical for us to have such insurance. Any uninsured occurrence may disrupt our business operations, require us to incur substantial costs and divert our resources, which could have an adverse effect on our results of operations and financial condition. Risks Related to Our Relationship with Our Controlling Shareholder Our controlling shareholder will control the outcome of shareholder actions in our company. On April 3, 2020, Linen Investment Limited, a wholly-owned subsidiary of Tencent, exercised its option to acquire 16,523,819 Class B ordinary shares for an aggregate purchase price of US$262.6 million in cash from JOYY Inc. On October 12, 2020, Linen Investment Limited entered into a share transfer agreement with certain affiliates of Mr. Rongjie Dong, our then chief executive officer and director, to purchase an additional 1,970,804 Class B ordinary shares, which agreement was terminated on July 12, 2021 concurrently with the termination of our proposed merger with DouYu in 2021. See “Item 4. Information on the Company.” On April 28, 2023, Linen Investment Limited entered into a definitive share transfer agreement with JOYY Inc. to acquire 38,374,463 Class B ordinary shares and the transaction was closed on May 5, 2023. As of March 31, 2026, Tencent held all of our outstanding Class B ordinary shares, resulting in 95.0% voting power in us calculated based on our total issued and outstanding shares. Tencent’s voting power gives it the power to control over certain actions that require shareholder approval under Cayman Islands law, our memorandum and articles of association and NYSE requirements, including approval of mergers and other business combinations, changes to our memorandum and articles of association, the number of shares available for issuance under any share incentive plans, and the issuance of significant amounts of our ordinary shares in private placements. Tencent’s voting control may cause transactions to occur that might not be beneficial to you as a holder of ADSs and may prevent transactions that would be beneficial to you. For example, Tencent’s voting control may prevent a transaction involving a change of control of us, including transactions in which you as a holder of our ADSs might otherwise receive a premium for your securities over the then-current market price. Tencent is not prohibited from selling a controlling interest in us to a third party and may do so without your approval and without providing for a purchase of your ADSs. If Tencent is acquired or otherwise undergoes a change of control, any acquirer or successor will be entitled to exercise the voting control and contractual rights of Tencent, and may do so in a manner that could vary significantly from that of Tencent. In addition, the significant concentration of share ownership may adversely affect the trading price of the ADSs due to investors’ perception that conflicts of interest may exist or arise. See “—We may have conflicts of interest with Tencent and, because of Tencent’s controlling ownership interest in our company, we may not be able to resolve such conflicts on favorable terms for us.” We may have conflicts of interest with Tencent and, because of Tencent’s controlling ownership interest in our company, we may not be able to resolve such conflicts on favorable terms for us. We may have conflicts of interest with Tencent and, because of Tencent’s controlling interest in our company, we may not be able to resolve such conflicts on favorable terms for us. Conflicts of interest may arise between Tencent and us in a number of areas relating to our ongoing relationships. Potential conflicts of interest that we have identified include the following: ● Agreements with Tencent. We may enter into agreements with Tencent from time to time. Tencent may use its control over us to prevent us from bringing a legal claim against it in the event of a contractual breach by Tencent, notwithstanding our contractual rights under these agreements. 42 Table of Contents ● Developing business relationships with Tencent’s competitors. So long as Tencent remains as our controlling shareholder, we may be limited in our ability to do business with its competitors. This may limit our ability to serve the best interests of our company and our other shareholders. ● Employee recruiting and retention. Because both Tencent and we are engaged in live streaming, online entertainment businesses, and game-related services in mainland China, we may compete with Tencent in the hiring of new employees and retaining talents. ● Allocation of business opportunities. There may arise other business opportunities that both we and Tencent find attractive. If Tencent decides to take up such opportunities itself, we may be prevented from taking advantage of those opportunities. ● Our directors may have conflicts of interest. As of the date of this annual report, a majority of our directors were appointed by Tencent. This relationship could create, or appear to create, conflicts of interest when these directors are faced with decisions with potentially different implications for Tencent and us. ● Sales of shares in our company. Tencent may decide to sell all or a portion of our shares that it holds to a third party, including our competitors, thereby giving that third party substantial influence over our business and our affairs. Such a sale could be contrary to the interests of our employees or our other shareholders. Although we are a stand-alone public company, we expect to operate, for as long as Tencent is our controlling shareholder, as an affiliate of Tencent. Tencent may from time to time make strategic decisions that it believes are in the best interests of its business as a whole, including our company. These decisions may be different from the decisions that we would have made on our own. Tencent’s decisions with respect to us or our business may be resolved in ways that favor Tencent and therefore Tencent’s own shareholders, which may not coincide with the interests of our other shareholders. Although we have an audit committee to review and approve all proposed related party transactions, including any transactions between us and Tencent, we may not be able to resolve any potential conflicts, and even if we do, the resolution may be less favorable to us than if we were dealing with a non-controlling shareholder. Even if both parties seek to do business on an arm’length term, the transaction may not meet the practical requirements of the arm’s length standard. Furthermore, if Tencent were to compete with us in the game live streaming services or our other key business initiatives, including game-related services, our business, financial condition, results of operations and prospects could be materially and adversely affected. If we are no longer able to benefit from our business cooperation with Tencent, our business may be adversely affected. Tencent, our controlling shareholder and strategic partner, is one of the largest internet companies in the world. Our business has benefited from our cooperation with Tencent. We cooperate with Tencent in a number of areas, such as content licensing, game-related services, advertising services, IT infrastructure and payment services. We cannot assure you that we will continue to benefit from our cooperation with Tencent and its affiliates in the future. To the extent we cannot maintain our cooperative relationships with Tencent on terms favorable to us or at all, including due to Tencent ceasing to be our controlling shareholder for any reason, we would need to source other business partners to provide replacement services. We cannot assure you that we will be able to find such partners or services on terms favorable to us or at all. Failure to do so could result in material and adverse effects on our business and results of operations. Any negative development in Tencent’s market position and reputation, brand recognition and financial condition may materially and adversely affect our user base and brand image. We have benefited and expect to continue to benefit from Tencent’s strong brand recognition, broad user base, and content ecosystem, which enhance our services and reputation. Any negative publicity associated with Tencent or any negative development with respect to Tencent’s market position and reputation, brand recognition, financial condition or compliance with legal requirements, including any reputational damages from regulatory developments, may have an adverse impact on our user traffic and engagement as well as our reputation and brand. 43 Table of Contents We are a “controlled company” within the meaning of the NYSE Listed Company Manual and, as a result, may rely on exemptions from certain corporate governance requirements that provide protection to shareholders of other companies. We are a “controlled company” as defined under the NYSE Listed Company Manual because Tencent owns more than 50% of our total voting power for the election of directors. For so long as we remain a controlled company under that definition, we are permitted to elect to rely, and have relied on, on certain exemptions from corporate governance rules, including an exemption from the rule that a majority of our board of directors must be independent directors, an exemption from the rule that we have to establish a nominating committee composed entirely of independent directors and an exemption from the rule that we have to establish a compensation committee that is composed entirely of independent directors. See “Item 6. Directors, Senior Management and Employees—C. Board Practices.” As a result, you will not have the same protection afforded to shareholders of companies that are subject to these corporate governance requirements. Risks Related to Our Corporate Structure If the government of mainland China finds that the structure we have adopted for our business operations does not comply with laws and regulations of mainland China, or if these laws or regulations or interpretations of existing laws or regulations change in the future, we could be subject to penalties, including the shutting down of our platform and our business operations. Current laws and regulations of mainland China impose certain restrictions or prohibitions on foreign ownership of companies that engage in internet and other related businesses, including the provision of internet content. Specifically, foreign ownership of an internet content provider may not exceed 50%. We are an exempted company limited by shares incorporated under the laws of the Cayman Islands and Guangzhou Huya Technology Co., Ltd., or Huya Technology, our wholly owned subsidiary in mainland China, is considered a foreign-invested enterprise. To comply with laws and regulations of mainland China, we conduct our business in mainland China through the variable interest entity, Guangzhou Huya, and its subsidiaries, based on a series of contractual arrangements by and among Huya Technology, Guangzhou Huya and its shareholders. As a result of these contractual arrangements, we have become the primary beneficiary of Guangzhou Huya for accounting purposes. Accordingly, we have consolidated the financial results of this variable interest entity and its subsidiaries in our consolidated financial statements under U.S. GAAP. The variable interest entity holds the licenses, approvals and key assets that are essential for our business operations. In addition, in 2009, the General Administration of Press and Publication and other government authorities have issued the Notice on Further Strengthening the Administration of Pre-examination and Approval of Online Games and the Examination and Approval of Imported Online Games, which prohibits the foreign investors to invest in online game-operating business in mainland China, including by way of variable interest entity structural similar to the one we adopted. See “Item 4. Information on the Company—B. Business Overview—Government Regulations—Regulations Relating to Foreign Ownership Restrictions.” We do not have an online game operating business subject to such prohibition, nor are we aware of any companies that have adopted a corporate structure that is the same as or similar to ours having been penalized or terminated due to such prohibition. However, if the government deems otherwise, and if we, our subsidiaries in mainland China or the variable interest entity are found to be in violation of such prohibition, the General Administration of Press and Publication, in conjunction with regulatory authorities in charge, may impose applicable penalties, which in the most serious cases may include suspension or revocation of relevant licenses and registrations. Investors in our ADSs are not purchasing equity interest in the variable interest entity in mainland China but instead are purchasing equity interest in a Cayman Islands holding company. If the government of mainland China deems that our contractual arrangements with the variable interest entity do not comply with regulatory restrictions of mainland China on foreign investment in the relevant industries, or if these regulations or the interpretation of existing regulations change or are interpreted differently in the future, we could be subject to penalties or be forced to relinquish our interests in those operations, and our ADSs may decline in value or become worthless, if we are unable to assert our contractual rights over the assets of the VIE which contributed to 91.6% of our revenues in 2025. Our holding company in the Cayman Islands, the variable interest entity, and investors of our company face uncertainty about potential future actions by the government of mainland China that could affect the enforceability of the contractual arrangements with the variable interest entity and, consequently, significantly affect the financial performance of the variable interest entity and our company as a group. 44 Table of Contents In the opinion of our mainland China legal counsel, Commerce & Finance Law Offices, based on its understanding of the laws and regulations in mainland China, each of the contracts among our subsidiary in mainland China, the variable interest entity and its shareholders is valid, binding and enforceable in accordance with its terms under currently effective laws and regulations. There are, however, uncertainties regarding the interpretation and application of current or future laws and regulations in mainland China. Thus, future governmental interpretations or enforcement practices may differ from those currently reflected in our mainland China legal counsel’s opinion. If we are found in violation of any laws or regulations of mainland China or if the contractual arrangements among Huya Technology, Guangzhou Huya and its shareholders are determined as illegal or invalid by the court in mainland China, arbitral tribunal or regulatory authorities, the governmental authorities may exercise their discretion in accordance with the applicable laws and regulations in dealing with such violation, including, without limitation: ● revoke our business and operating licenses; ● levy fines on us; ● confiscate any of our income that they deem to be obtained through illegal operations; ● require us to discontinue or restrict operations; ● restrict our right to collect revenues; ● block our mobile apps, websites, or PC clients; ● require us to restructure the operations in such a way as to compel us to establish a new enterprise, re-apply for the necessary licenses or relocate our businesses, staff and assets; ● impose additional conditions or requirements with which we may not be able to comply; or ● take other regulatory or enforcement actions against us that could be harmful to our business. The imposition of any of these penalties may result in a material and adverse effect on our ability to conduct the business. In addition, if the imposition of any of these penalties causes us to lose the rights to direct the activities of the variable interest entity and its subsidiaries or the right to receive their economic benefits, we would no longer be able to consolidate the variable interest entity and its subsidiaries. We do not believe that any penalties imposed or actions taken by the government of mainland China would result in the liquidation of our company, Huya Technology, Guangzhou Huya and its subsidiaries. We rely on contractual arrangements with the variable interest entity and its shareholders for the operation of our business, which may not be as effective as direct ownership. If the variable interest entity and its shareholders fail to perform their obligations under these contractual arrangements, we may have to resort to litigation to enforce our rights, which may be time-consuming, unpredictable, expensive and damaging to our operations and reputation. Because of restrictions on foreign ownership of internet-based businesses in mainland China, we depend on contractual arrangements with the variable interest entity in which we have no direct ownership interest to conduct our business. These contractual arrangements are intended to provide us with contractual rights over these entities and allow us to obtain economic benefits from them. See “Item 4. Information on the Company—C. Organizational Structure—Contractual Arrangements with Guangzhou Huya” for more details about these contractual arrangements. However, these contractual arrangements may not be as effective in providing control as direct ownership. For example, the variable interest entity and its shareholders could breach their contractual arrangements with us by, among other things, failing to operate our business in an acceptable manner or taking other actions that are detrimental to our interests. If we were the controlling shareholder of the variable interest entity with direct ownership, we would be able to exercise our rights as shareholders to effect changes to its board of directors, which in turn could implement changes at the management and operational level. However, under the current contractual arrangements, if the variable interest entity or their shareholders fail to perform their obligations under these contractual arrangements, we may have to incur substantial costs to enforce such arrangements, and rely on legal remedies under law of mainland China, including contract remedies, which may not be sufficient or effective. 45 Table of Contents All of these contractual arrangements are governed by and interpreted in accordance with law of mainland China. Disputes arising from these contractual arrangements between us and the variable interest entity will be resolved through arbitration in mainland China, although these disputes do not include claims arising under the United States federal securities law and thus do not prevent you from pursuing claims under the United States federal securities law. Uncertainties relating to the enforcement of legal rights through arbitration, litigation and other legal proceedings remain in mainland China, which could limit our ability to enforce these contractual arrangements and exert contractual rights over the variable interest entity. If we are unable to enforce these contractual arrangements, or if we suffer significant delay or other obstacles in the process of enforcing these contractual arrangements, our business and operations could be severely disrupted, which could materially and adversely affect our results of operations and damage our reputation. See “—Risks Related to Doing Business in Mainland China—Uncertainties with respect to the legal system of mainland China and the interpretation and enforcement of laws and regulations of mainland China may affect the legal protections available to you and us.” The shareholders of the VIE have potential conflicts of interest with us, and if any such conflicts of interest are not resolved in our favor, our business may be materially and adversely affected. What is in the best interests of the variable interest entity may not be in the best interests of our company. We cannot assure you that when conflicts of interest arise, the nominee shareholders of the variable interest entity will act in the best interests of our company or that conflicts of interests will be resolved in our favor. In addition, the nominee shareholders of the variable interest entity may breach or cause Guangzhou Huya and its respective subsidiaries to breach or refuse to renew the existing contractual arrangements with us. Currently, we do not have existing arrangements to address such potential conflicts of interest; provided that we could, at all times, exercise our option under the exclusive option agreement to cause the nominee shareholders to transfer all of their equity ownership in Guangzhou Huya to a mainland China entity or individual designated by us, and this new shareholder of Guangzhou Huya could then appoint a new director of Guangzhou Huya to replace the existing directors. In addition, if such conflicts of interest arise, Huya Technology, our wholly owned subsidiary in mainland China, could also, in the capacity of attorney-in-fact for the nominee shareholders as provided under the relevant powers of attorney, directly appoint a new director of Guangzhou Huya. We rely on the nominee shareholders to comply with the laws of mainland China, which protect our contractual rights and provide that a director owes a duty of loyalty to our company and require them to avoid conflicts of interest and not to take advantage of their position for personal gains. If we cannot resolve any conflicts of interest or disputes between us and the nominee shareholders of the variable interest entity, we would have to rely on legal proceedings, which could result in disruption of our business and subject us to uncertainty as to the outcome of any such legal proceedings. Uncertainties exist with respect to the interpretation and implementation of the PRC Foreign Investment Law and how it may impact the viability of our current corporate structure, corporate governance and business operations. On March 15, 2019, the National People’s Congress approved the Foreign Investment Law, which came into effect on January 1, 2020. The Foreign Investment Law embodies a regulatory trend in mainland China to rationalize its foreign investment regulatory regime in line with prevailing international practice and the legislative efforts to unify the corporate legal requirements for both foreign and domestic investments. However, uncertainties still exist in relation to its interpretation and implementation of the Foreign Investment Law and its current implementation and interpretation rules. For instance, under the Foreign Investment Law, “foreign investment” refers to the investment activities directly or indirectly conducted by foreign individuals, enterprises or other entities in mainland China. Though it does not explicitly classify contractual arrangements as a form of foreign investment, there is no assurance that foreign investment via contractual arrangement would not be interpreted as a type of indirect foreign investment activities under the definition in the future. In addition, the definition contains a catch-all provision which includes investments made by foreign investors through means stipulated in laws or administrative regulations or other methods prescribed by the State Council. Therefore, it still leaves leeway for future laws, administrative regulations or provisions promulgated by the State Council to provide for contractual arrangements as a form of foreign investment. In any of these cases, it will be uncertain whether our contractual arrangements will be deemed to be in violation of the market access requirements for foreign investment under the laws and regulations in mainland China. Furthermore, if future laws, administrative regulations or provisions prescribed by the State Council mandate further actions to be taken by companies with respect to existing contractual arrangements, we may face uncertainties as to whether we can complete such actions in a timely manner, or at all. Failure to take timely and appropriate measures to cope with any of these or similar regulatory compliance challenges could materially and adversely affect our current corporate structure, corporate governance and business operations. 46 Table of Contents Our existing shareholders have substantial influence over our company and their interests may not be aligned with the interests of our other shareholders, which may discourage, delay or prevent a change in control of our company, which could deprive our shareholders of an opportunity to receive a premium for their securities. As of March 31, 2026, our controlling shareholder Tencent held 95.0% voting power in us calculated based on our total issued and outstanding shares. In addition, the shareholder of the variable interest entity, Guangzhou Huya, is Linzhi Tencent Technology Co., Ltd., or Linzhi Tencent, which owns 100% of the equity interests in Guangzhou Huya. Our controlling shareholder and management group has substantial influence over our business, including decisions regarding mergers, consolidations and the sale of all or substantially all of our assets, election of directors and other significant corporate actions. This concentration of ownership may discourage, delay or prevent a change in control of our company, which could deprive our shareholders of an opportunity to receive a premium for their shares as part of any contemplated sale of our company and may reduce the price of our ADSs. In addition, our management group could violate their legal duties by diverting business opportunities from us, resulting in our losses of corporate opportunities. These actions may take place even if they are opposed by our other shareholders and therefore adversely affect the value of our shares. We may lose the ability to use and enjoy assets held by the variable interest entity that are important to the operation of our business if such entity goes bankrupt or become subject to a dissolution or liquidation proceeding. As part of our contractual arrangements with the variable interest entity, Guangzhou Huya holds certain assets, such as patents for the proprietary technology that are essential to the operations of our platform and important to the operation of our business. If Guangzhou Huya goes bankrupt and all or part of its assets become subject to liens or rights of third-party creditors, we may be unable to continue some or all of our business activities, which could materially and adversely affect our business, financial condition and results of operations. If the variable interest entity undergoes a voluntary or involuntary liquidation proceeding, the unrelated third-party creditors may claim rights to some or all of its assets, thereby hindering our ability to operate our business, which could materially and adversely affect our business, financial condition and results of operations. Our ability to enforce the equity pledge agreements between us and the variable interest entity’s shareholders may be subject to limitations based on laws and regulations in mainland China. Pursuant to the equity interest pledge agreements between Guangzhou Huya, the variable interest entity, and Huya Technology, our wholly-owned subsidiary in mainland China, and the shareholders of Guangzhou Huya, each shareholder of Guangzhou Huya agrees to pledge its equity interests in Guangzhou Huya to our subsidiary to secure Guangzhou Huya’s performance of its obligations under the contractual arrangements. The equity interest pledges of shareholders of variable interest entity under these equity pledge agreements have been registered with the local branch of the State Administration for Market Regulation of China. In addition, in the registration forms of the local branch of the State Administration for Market Regulation for the pledges over the equity interests under the equity interest pledge agreements, the aggregate amount of registered equity interests pledged to Huya Technology represents 100% of the registered capital of Guangzhou Huya. The equity interest pledge agreements with the VIE’s shareholders provide that the pledged equity interest shall constitute continuing security for any and all of the indebtedness, obligations and liabilities under all of the principal service agreements and the scope of pledge shall not be limited by the amount of the registered capital of that variable interest entity. However, it is possible that a court in mainland China may take the position that the amount listed on the equity pledge registration forms represents the full amount of the collateral that has been registered and perfected. If this is the case, the obligations that are supposed to be secured in the equity interest pledge agreements in excess of the amount listed on the equity pledge registration forms could be determined by the court in mainland China as unsecured debt, which takes last priority among creditors. ​ 47 Table of Contents Our contractual arrangements with the variable interest entity may result in adverse tax consequences to us. As a result of our corporate structure and the contractual arrangements among our subsidiary in mainland China, the variable interest entity and its shareholders, we are effectively subject to turnover tax in mainland China on revenues generated by our subsidiaries from our contractual arrangements with the variable interest entity. Such tax generally includes the value-added tax in mainland China, or the VAT, primarily at a rate of 6% along with related surcharges. The applicable turnover tax is determined by the nature of the transaction generating the revenues subject to taxation. The mainland China enterprise income tax law requires every enterprise in mainland China to submit its annual enterprise income tax return together with a report on transactions with its affiliates or related parties to the tax authorities. These transactions may be subject to audit or challenge by the tax authorities of mainland China within ten years after the taxable year during which the transactions are conducted. We may be subject to adverse tax consequences if the tax authorities of mainland China were to determine that the contracts between us and the variable interest entity were not on an arm’s length basis and therefore constitute favorable transfer pricing arrangements. If this occurs, the tax authorities of mainland China could request that the variable interest entity adjust its taxable income upward for purposes of tax in mainland China. Such a pricing adjustment could adversely affect us by reducing expense deductions recorded by the variable interest entity and thereby increasing its entities’ tax liabilities, which could subject the VIE to late payment fees and other penalties for the underpayment of taxes. Our financial results may be materially and adversely affected if the variable interest entity’s tax liabilities increase or if it becomes subject to late payment fees or other penalties. Risks Related to Doing Business in Mainland China The PCAOB had historically been unable to inspect our auditor in relation to their audit work performed for our financial statements and the inability of the PCAOB to conduct inspections of our auditor in the past has deprived our investors with the benefits of such inspections. Our auditor, the independent registered public accounting firm that issues the audit report included elsewhere in this annual report, as an auditor of companies that are traded publicly in the United States and a firm registered with the PCAOB, is subject to laws in the United States pursuant to which the PCAOB conducts regular inspections to assess its compliance with the applicable professional standards. The auditor is located in mainland China, a jurisdiction where the PCAOB had historically been unable to conduct inspections and investigations completely before 2022. As a result, we and investors in the ADSs were deprived of the benefits of such PCAOB inspections. The inability of the PCAOB to conduct inspections of auditors in China in the past has made it more difficult to evaluate the effectiveness of our independent registered public accounting firm’s audit procedures or quality control procedures as compared to auditors outside of China that are subject to the PCAOB inspections. On December 15, 2022, the PCAOB issued a report that vacated its December 16, 2021 determination and removed mainland China and Hong Kong from the list of jurisdictions where it is unable to inspect or investigate completely registered public accounting firms. However, there can be no assurance that the PCAOB will be able to continue to inspect and investigate completely registered public accounting firms in mainland China and Hong Kong in the future. If the PCAOB determines in the future that it no longer has full access to inspect and investigate completely accounting firms in mainland China and Hong Kong, and we use an accounting firm headquartered in one of these jurisdictions to issue an audit report on our financial statements filed with the Securities and Exchange Commission, we and investors in our ADSs would be deprived of the benefits of such PCAOB inspections again, which could cause investors and potential investors in the ADSs to lose confidence in our audit procedures and reported financial information and the quality of our financial statements. Our ADSs may be prohibited from trading in the United States under the HFCAA in the future if the PCAOB is unable to inspect or investigate completely auditors located in China. The delisting of the ADSs, or the threat of their being delisted, may materially and adversely affect the value of your investment. Pursuant to the HFCAA, if the SEC determines that we have filed audit reports issued by a registered public accounting firm that has not been subject to inspections by the PCAOB for two consecutive years, the SEC will prohibit our shares or ADSs from being traded on a national securities exchange or in the over-the-counter trading market in the United States. On December 16, 2021, the PCAOB issued a report to notify the SEC of its determination that the PCAOB was unable to inspect or investigate completely registered public accounting firms headquartered in mainland China and Hong Kong, including our auditor. In May 2022, the SEC conclusively listed us as a Commission-Identified Issuer under the HFCAA following the filing of our annual report on Form 20-F for the fiscal year ended December 31, 2021. On December 15, 2022, the PCAOB removed mainland China and Hong Kong from the list of jurisdictions where it is unable to inspect or investigate completely registered public accounting firms. For this reason, we were not identified as a Commission-Identified Issuer under the HFCAA for the previous fiscal year and do not expect to be so identified after we file this annual report on Form 20-F. 48 Table of Contents Each year, the PCAOB will determine whether it can inspect and investigate completely audit firms headquartered in mainland China and Hong Kong, among other jurisdictions. There can be no assurance that the PCAOB will continue to determine that it can inspect and investigate completely audit firms headquartered in mainland China and Hong Kong, among other jurisdictions, at all times. If the PCAOB determines in the future that it no longer has full access to inspect and investigate completely accounting firms in mainland China and Hong Kong and we use an accounting firm headquartered in one of these jurisdictions to issue an audit report on our financial statements filed with the Securities and Exchange Commission, we would be identified as a Commission-Identified Issuer following the filing of the annual report on Form 20-F for the relevant fiscal year. In accordance with the HFCAA, our securities would be prohibited from being traded on a national securities exchange or in the over-the-counter trading market in the United States if we are identified as a Commission-Identified Issuer for two consecutive years in the future. If our shares and ADSs are prohibited from trading in the United States, there is no certainty that we will be able to list on a non-U.S. exchange or that a market for our shares will develop outside of the United States. A prohibition of being able to trade in the United States would substantially impair your ability to sell or purchase our ADSs when you wish to do so, and the risk and uncertainty associated with delisting would have a negative impact on the price of our ADSs. In addition, such a prohibition would significantly affect our ability to raise capital on terms acceptable to us, or at all, which would have a material adverse impact on our business, financial condition, and prospects. The significant oversight and discretion of the government of mainland China over our business operation could result in a material adverse change in our operations and the value of our ADSs. We conduct our business primarily in mainland China. Our operations in mainland China are governed by laws and regulations in mainland China. The government of mainland China has certain oversight and discretion over the conduct of our business, and may regulate or influence our operations to advance regulatory and social goals and policy positions. The government of mainland China has published policies that significantly affected certain industries and we cannot rule out the possibility that the government of mainland China will in the future release regulations or policies that directly or indirectly affect our industry or require us to seek additional permission to continue our operations, which could result in a material adverse change in our operation, and our ADSs may decline in value or become worthless. Therefore, investors of our company and our business face potential uncertainty from actions taken by the mainland China government affecting our business. Compliance with the laws or regulations governing virtual currency may result in us having to obtain additional approvals or licenses or change our current business model. The issuance and use of “virtual currency” in mainland China have been regulated since 2007 in response to the growth of the online games industry in mainland China. On January 25, 2007, the Ministry of Public Security, the Ministry of Culture and Tourism, the Ministry of Industry and Information Technology and the General Administration of Press and Publication jointly issued a circular regarding online gambling which has implications for the use of virtual currency. To curtail online games that involve online gambling, as well as address concerns that virtual currency could be used for money laundering or illicit trade, the circular (a) prohibits online game operators from charging commissions in the form of virtual currency in relation to winning or losing of games; (b) requires online game operators to impose limits on use of virtual currency in guessing and betting games; (c) bans the conversion of virtual currency into real currency or property; and (d) prohibits services that enable game players to transfer virtual currency to other players. On June 4, 2009, the Ministry of Culture and Tourism and the Ministry of Commerce jointly issued a notice regarding strengthening the administration of online game virtual currency. Although we issue different virtual currencies to users on our platform for them to purchase various items to be used on our platform as well in online games, our service does not constitute online game virtual currency transaction services because users cannot transfer or trade these currencies among themselves. However, we cannot assure you that the regulatory authorities of mainland China will not take a view contrary to ours. If the regulatory authorities of mainland China deem any transfer or exchange on our platform to be a virtual currency transaction, then in addition to being deemed to be engaging in the issuance of virtual currency, we may also be deemed to be providing transaction platform services that enable the trading of such virtual currency. Simultaneously engaging in both of these activities is prohibited under the notice regarding strengthening the administration of online game virtual currency issued by the Ministry of Culture and Tourism and the Ministry of Commerce. In that event, we may be required to cease either our virtual currency issuance activities or such deemed “transaction service” activities and may be subject to certain penalties, including mandatory corrective measures and fines. The occurrence of any of the foregoing could have a material adverse effect on our business, financial condition and results of operations. Furthermore, our broadcasters and users may misuse our virtual currencies to engage in illegal conducts and disguise their illicit intent via the entertainment features available on our platform. As these misconducts usually take place in disguised form, we may not be able detect these illegal conducts in a timely manner, or at all. If we fail to timely detect these illegal conducts and eliminate them, we may be subject to administrative penalties as well as civil and criminal liabilities, which may materially and adversely affect our business, results of operations, financial condition and business prospects. 49 Table of Contents Changes in the economic, political or social conditions or government policies in mainland China could have a material adverse effect on our business and operations. Substantially all of our assets and operations are located in mainland China. Accordingly, our results of operations, financial condition and prospects are influenced by economic, political and legal developments in mainland China. Economic reforms begun in the late 1970s have resulted in significant economic growth. However, any economic reform policies or measures in mainland China may from time to time be modified or revised. Economy in mainland China differs from the economies of other countries in many respects, including with respect to the amount of government involvement, level of development, growth rate, control of foreign exchange and allocation of resources. Any adverse changes in economic conditions in mainland China, in the policies of the government of mainland China or in the laws and regulations in mainland China could have a material adverse effect on the overall economic growth of mainland China. Such developments could adversely affect our business and results of operations, lead to reduction in demand for our services and adversely affect our competitive position. Therefore, investors of our company and our business face potential uncertainty from mainland China. Uncertainties with respect to the legal system of mainland China and the interpretation and enforcement of laws and regulations of mainland China may affect the legal protections available to you and us. The legal system of mainland China is based on written statutes where prior court decisions have limited value as precedents. The legal system of mainland China is evolving rapidly, and the interpretations of many laws, regulations and rules may contain inconsistencies and enforcement of these laws, regulations and rules involves uncertainties. Moreover, because the laws, regulations, and standards in the legal system of mainland China are subject to interpretations, their application in practice may evolve over time as new guidance becomes available. This evolvement may result in additional costs necessitated by ongoing revisions to our disclosure and governance practices. If we fail to address and comply with these regulations and any subsequent changes, we may be subject to penalties and our business may be harmed. From time to time, we may have to resort to administrative and court proceedings to enforce our legal rights. However, since administrative and court authorities of mainland China have significant discretion in interpreting and implementing statutory and contractual terms, it may be more difficult to evaluate the outcome of administrative and court proceedings. Such uncertainties, including uncertainty over the scope and effect of our contractual, property (including intellectual property) and procedural rights, could materially and adversely affect our business and impede our ability to continue our operations. The approval of and filing with the China Securities Regulatory Commission or other government authorities in mainland China may be required in connection with our future offshore offerings and capital raising activities under law of mainland China, and, if required, we cannot predict whether or for how long we will be able to obtain such approval or complete such filing. The Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors, adopted by six regulatory agencies of mainland China in 2006 and amended in 2009, require an overseas special purpose vehicle formed for listing purposes through acquisitions of mainland China domestic companies and controlled by persons or entities of mainland China to obtain the approval of the China Securities Regulatory Commission prior to the listing and trading of such special purpose vehicle’s securities on an overseas stock exchange. The interpretation and application of the regulations remain uncertain, and our offshore offerings may ultimately require approval of the China Securities Regulatory Commission. If the approval of the China Securities Regulatory Commission is required, it is uncertain whether we can or how long it will take us to obtain the approval and, even if we obtain such approval, the approval could be rescinded. Any failure to obtain or delay in obtaining the approval of the China Securities Regulatory Commission for any of our offshore offerings, or a rescission of such approval if obtained by us, would subject us to sanctions imposed by the China Securities Regulatory Commission or other regulatory authorities of mainland China, which could include fines and penalties on our operations in mainland China, restrictions or limitations on our ability to pay dividends outside of mainland China, and other forms of sanctions that may materially and adversely affect our business, financial condition, and results of operations. ​ 50 Table of Contents On February 17, 2023, the China Securities Regulatory Commission released several regulations regarding the filing requirements for overseas offerings and listings by domestic companies, including the Trial Administrative Measures of Overseas Securities Offerings and Listings by Domestic Companies and five interpretive guidelines (collectively, the “Overseas Listing Filing Rules”), which were formally implemented starting on March 31, 2023. Subsequently, the China Securities Regulatory Commission promulgated supporting guideline No. 6, which became effective on May 16, 2023, and supporting guideline No. 7, which became effective on May 7, 2024. According to the Overseas Listing Filing Rules, a filing-based regulatory system will be applied to “indirect overseas offerings and listings” of domestic companies in mainland China, which refers to securities offerings and listings in an overseas market made under the name of an offshore entity but based on the underlying equity, assets, earnings or other similar rights of a domestic company that operates its main business domestically. Pursuant to the Announcement Relating to the Notice on Filing Management Arrangements for Overseas Securities Offering and Listing by Domestic Companies issued by the China Securities Regulatory Commission, domestic companies that had been listed overseas prior to March 31, 2023 are “existing enterprises” that are not required to file with the China Securities Regulatory Commission with regard to their previous listing immediately. However, such companies are required to fulfill the filing requirements when they pursue any future securities offerings and listings for which filings are required as provided in the Overseas Listing Filing Rules, including but not limited to follow-on offerings, secondary listings and going private transactions. Therefore, any such offerings or listings conducted by us in overseas markets will be subject to the filing procedures with the China Securities Regulatory Commission. If we fail to obtain required approval or complete other review or filing procedures, under the Overseas Listing Filing Rules or otherwise, for any future overseas securities offerings or listings, including but not limited to follow-on offerings, issuance of convertible bonds, secondary listings, offshore relisting after going-private transactions, and other equivalent offering activities, we may face sanctions by the China Securities Regulatory Commission or other regulatory agencies of mainland China, which may include fines and penalties on our operations in mainland China, limitations on our operating privileges in mainland China, restrictions on or prohibition of the payments or remittance of dividends by our subsidiaries in mainland China, or other actions that could have a material and adverse effect on our business, financial condition, results of operations, reputation and prospects, as well as the trading price of our ADSs. In addition, we are required to file a report to the China Securities Regulatory Commission after the occurrence and public disclosure of certain material corporate events, including but not limited to, change of control and voluntary or mandatory delisting. The China Securities Regulatory Commission or other regulatory authorities of mainland China also may take actions requiring us, or making it advisable for us, to halt our offerings before settlement and delivery of the shares offered. Consequently, if investors engage in market trading or other activities in anticipation of and prior to settlement and delivery, they do so at the risk that settlement and delivery may not occur. Furthermore, if the China Securities Regulatory Commission or other regulatory authorities later promulgate new rules or explanations requiring that we obtain their approvals or accomplish the required filing or other regulatory procedures for our prior offshore offerings, we may be unable to obtain a waiver of such approval requirements, if and when procedures are established to obtain such a waiver. Any uncertainties or negative publicity regarding such approval requirement could materially and adversely affect our business, prospects, financial condition, reputation, and the trading price of our ADSs. Our subsidiaries in mainland China and the variable interest entity are subject to restrictions on paying dividends or making other payments to us, which may restrict our ability to satisfy our liquidity requirements. We are a holding company incorporated in the Cayman Islands. We rely on dividends from our subsidiaries in mainland China which in turn rely on consulting and other fees paid by the variable interest entity for our cash and financing requirements, such as the funds necessary to pay dividends and other cash distributions to our shareholders, including holders of our ADSs, and service any debt we may incur. Current regulations of mainland China permit our subsidiaries in mainland China to pay dividends to us only out of their accumulated after-tax profits upon satisfaction of relevant statutory condition and procedures, if any, determined in accordance with Chinese accounting standards and regulations. In addition, each of our subsidiaries in mainland China is required to set aside at least 10% of its accumulated profits each year, if any, to fund certain reserve funds until the total amount set aside reaches 50% of its registered capital. As of December 31, 2025, we made appropriations of RMB122.4 million (US$17.5 million) to statutory reserves. Furthermore, if our subsidiaries in mainland China, the variable interest entity and its subsidiaries incur debt on their own behalf in the future, the instruments governing the debt may restrict their ability to pay dividends or make other payments to us, which may restrict our ability to satisfy our liquidity requirements. 51 Table of Contents In addition, the Enterprise Income Tax Law, and its implementation rules provide that withholding tax rate of 10% will be applicable to dividends payable by Chinese companies to non-mainland China-resident enterprises unless otherwise exempted or reduced according to treaties or arrangements between the central government of mainland China and governments of other countries or regions where the non-mainland China-resident enterprises are incorporated. As of December 31, 2025, the undistributed earnings and reserves of our subsidiaries and the variable interest entity located in mainland China are considered to be indefinitely reinvested, because we do not have any present plan to utilize the funds in these subsidiaries or the variable interest entity located in mainland China for dividend declaration in the foreseeable future, and we intend to retain most of the available funds and any future earnings in these subsidiaries or the variable interest entity for use in the operation and expansion of our business. Regulation and censorship of information disseminated over the mobile and internet in mainland China may adversely affect our business and subject us to liability for content streamed or posted on our platform. Internet companies in mainland China are subject to a variety of existing and new rules, regulations, policies, and license and permit requirements. In connection with enforcing these rules, regulations, policies and requirements, the government authorities may suspend services by, or revoke licenses of, any internet or mobile content service provider that is deemed to provide illicit content online or on mobile devices, and such activities may be intensified in connection with any ongoing government campaigns to eliminate prohibited content online. Since 2018, the Chinese regulatory authorities have conducted the “Clean Up the Internet” campaign on a yearly basis, aiming to eliminate pornographic information and content in the internet information services industry by, among other things, holding liable individuals and corporate entities that facilitate the distribution of pornographic information and content. We may also be subject to other routine or specific campaigns from time to time. During the campaigns, government authorities have taken various measures such as shutting down websites, removing links, closing accounts, seizing publications and closing down mobile apps that contain illegal, harmful or obscene information. In March 2018, the government of mainland China issued a notice to further regulate the transmission of internet audio-visual programs. Given the uncertainty in the interpretation and implementation of this notice, we may be required to subsequently implement further content monitoring measures, which could materially and adversely affect our business, financial condition and results of operations. For further information regarding this notice, see “Item 4. Information on the Company—B. Business Overview—Government Regulations—Online Transmission of Audio-Visual Programs.” We endeavor to eliminate illicit content from our platform. We have made substantial investments in resources to monitor content that users post on our platform and the way in which our users engage with each other through our platform. We use a variety of methods to ensure our platform remains a healthy and positive experience for our users. See “Item 4. Information on the Company—B. Business Overview—Content Moderation.” In response to the above-mentioned campaigns, we adopted various measures to prevent the dissemination of gambling, pornographic and other illicit information. Although we employ these methods to filter content posted by our users, we cannot be sure that our internal content control efforts will be sufficient to remove all content that may be viewed as indecent or otherwise non-compliant with law and regulations of mainland China. Government standards and interpretations as to what constitutes illicit online content or behavior are subject to interpretation and may change in a manner that could render our current monitoring efforts insufficient. The Chinese government has wide discretion in regulating online activities and, irrespective of our efforts to control the content on our platform, government campaigns and other actions to reduce illicit content and activities could subject us to negative press or regulatory challenges and sanctions, including fines, suspension or revocation of our licenses to operate in mainland China or a ban on our platform, including closure of one or more parts of or our entire business. Further, our senior management could be held criminally liable if we are deemed to be profiting from illicit content on our platform. Although our business and operations have not been materially and adversely affected by government campaigns or any other regulatory actions in the past, we cannot assure you that our business and operations will be immune from government actions or sanctions in the future. If government actions or sanctions are brought against us, or if there are widespread rumors that government actions or sanctions have been brought against us, our reputation could be harmed, we may lose users and customers, our revenues and results of operations may be materially and adversely affected and the value of our ADSs could be dramatically reduced. 52 Table of Contents We may be adversely affected by the complexity, uncertainties and changes in the regulation of mainland China relating to the internet industry and companies. The government of mainland China extensively regulates the internet industry, including foreign ownership of, and the licensing and permit requirements pertaining to, companies in the internet industry. These internet-related laws and regulations are relatively new and evolving, and their interpretation and enforcement may change from time to time. As a result, in certain circumstances it may be difficult to determine what actions or omissions may be deemed to be in violations of applicable laws and regulations. Issues, risks and uncertainties relating to the regulation of the internet business in mainland China include, but are not limited to, the following: ● We only have contractual rights over our platform. Guangzhou Huya, the variable interest entity, owns our platform due to the restriction of foreign investment in businesses providing value-added telecommunication services in mainland China, including internet content provision services. If Guangzhou Huya breaches its contractual arrangements with us and no longer remains under our control, this may significantly disrupt our business, subject us to sanctions, compromise enforceability of related contractual arrangements, or have other harmful effects on us. ● There are uncertainties relating to the regulation of the internet business in mainland China, including evolving licensing practices and the requirement for real-name registrations and its implementation in actual practice. Permits, licenses or operations at some of our subsidiaries and variable interest entity levels may be subject to challenge, or we may fail to obtain permits or licenses that may be deemed necessary for our operations or we may not be able to obtain or renew certain permits or licenses. See “—Risks Related to Our Business and Our Industry—If we fail to obtain and maintain the licenses and approvals required under the complex regulatory environment for internet-based businesses in mainland China, our business, financial condition and results of operations may be materially and adversely affected” and “Item 4. Information on the Company—B. Business Overview” for details. In addition, if we were required to implement real-name registration system on our platform with stricter and higher standards, we may lose large numbers of registered user accounts for various reasons, because users may no longer maintain multiple accounts and users who dislike giving out their private information may cease to use our products and services altogether. ● The evolving regulatory system in mainland China for the internet industry may lead to the establishment of new regulatory agencies. We are unable to determine what policies any new agencies to be established in the future may have or how they may interpret existing laws, regulations and policies and how they may affect us. Furthermore, new laws, regulations or policies may be promulgated or announced that will regulate internet activities, including online video and online advertising businesses. If these new laws, regulations or policies are promulgated, additional licenses may be required for our operations. If our operations do not comply with these new regulations after they become effective, or if we fail to obtain any licenses required under these new laws and regulations, we could be subject to penalties. The interpretation and application of existing mainland China laws, regulations and policies and possible new laws, regulations or policies relating to the internet industry have created uncertainties regarding the legality of existing and future foreign investments in, and the businesses and activities of, internet businesses in mainland China, including our business. There are also risks that we may be found to violate the existing or future laws and regulations given the uncertainty and complexity of regulation of internet business of mainland China. On August 31, 2018, the Standing Committee of the National People’s Congress issued the E-commerce Law, which came into effect on January 1, 2019. Pursuant to the E-commerce Law, operators of e-commerce platforms shall verify and register the basic information of e-commerce operators on their platforms, including the identity, address, contact and administrative license, and establish archives with regular updates for such information. It further provides that operators of e-commerce platforms shall submit information on the identification of e-commerce operators to department for market regulation and submit e-commerce operators’ identification information and other information relating to tax payment to tax authority. Additionally, operators of e-commerce platforms shall record and save information released on their platform about commodities and services, and report to competent authorities, if such information show that e-commerce operators have failed to obtain the administrative license when they are subject to the administrative approval, or commodities sold or services offered by e-commerce operators are found to be in violation of certain requirements to safeguard personal safety, property security and the requirements on environmental protection, or to be prohibited by laws and administrative regulations. 53 Table of Contents The E-commerce Law establishes obligations to protect consumers for operators of e-commerce platforms, such as obligations to protect consumers’ personal information and record information of deals concluded on their platforms, obligations to refund guarantee deposits to consumers in a timely manner and obligations to noticeably label commodities or services ranked under competitive bidding with the word “Advertisement.” E-commerce operators shall not conduct false or misleading commercial publicity by fabricating transactions, making up user reviews or any other means, to cheat or mislead consumers. E-commerce platform operators shall not delete consumers’ ratings of commodities sold or services provided on the platform. We have carried out compliance work in accordance with these regulatory requirements. In addition, on December 18, 2024, the State Administration for Market Regulation promulgated the Interim Measures for Assistance in Law Enforcement Investigation Relating to Online Transactions (effective on January 20, 2025); on March 18, 2025, the State Administration for Market Regulation amended the Measures for the Supervision and Administration of Online Transactions (effective on May 1, 2025); and on December 18, 2025, the State Administration for Market Regulation and the Cyberspace Administration of China jointly promulgated the Measures for the Supervision and Administration of Rules of Online Transaction Platforms (effective on February 1, 2026), all of which further strengthen and specify the obligations of operators of online transaction platforms. However, there are uncertainties with respect to the interpretation and implementation of the E-commerce Law and the related regulations, and how these laws and regulations may impact our business operations. We cannot guarantee that the compliance measures we have taken are fully consistent with the interpretation of regulators, and there is a risk that the company will be punished by those regulators because of any non-compliance activities. In April 2022, the Cyberspace Administration of China launched the “Clear and Bright” campaign to rectify a variety of online misconduct, in response to which certain enforcement actions were launched. If the governmental authorities of mainland China determine that we are not in compliance with all the requirements under applicable laws and regulations relating to Internet content, we may be subject to fines and/or other sanctions such as an order to correct the violation, confiscation of illegal earnings, suspension or shutdown of the related business and website, cessation of business operation for rectification, and revocation of business license, any of which could disrupt our operations. In conducting anti-monopoly and competition laws and regulations related scrutiny or action, governmental agencies and regulators may, among other things, prohibit future acquisitions, divestitures, or combinations we plan to make, impose significant fines or penalties, require divestiture of certain of our assets, or impose other restrictions that limit or require us to modify our operations. On July 10, 2021, the State Administration for Market Regulation decided to prohibit our proposed merger with DouYu following its antitrust review, as a result of which the proposed merger was terminated. The anti-monopoly regulators may also issue implementation rules or guidelines from time to time to reinforce their regulation on certain industrial sectors. For instance, on February 7, 2021, the Anti-monopoly Committee of the State Council published the Guideline on Anti-monopoly of Platform Economy Sector, or the Guideline, which became effective on the same day, aiming at enhancing anti-monopoly administration on businesses that operate under the platform model and the overall platform economy. This guideline intends to regulate abuse of a dominant position and other anti-competitive practices by online platform operators and the related merchants and service providers on online platforms, such as unfairly locking in exclusive agreements with merchants and targeting specific customers with unreasonable big-data driven tailored pricing through their online behavior to eliminate or limit market competition. On June 24, 2022, the revised version of Anti-Monopoly Law was promulgated by the Standing Committee of the National People’s Congress. According to the revised Anti-monopoly Law, where a concentration of undertakings reaches the declaration threshold stipulated by the State Council, a declaration must be approved by the anti-monopoly authority before parties implement the concentration. Furthermore, the Provisions on the Review of Concentrations of Undertakings issued by the State Administration for Market Regulation on March 10, 2023 further clarified the factors that should be considered to determine whether an undertaking acquires control over, or may exercise decisive influence on, other undertakings. On January 28, 2026, the State Administration for Market Regulation promulgated the Guidelines on Anti-Monopoly Compliance for Internet Platforms, which further provide compliance standards under the Guideline. As of the date of this annual report, other than the decision of the State Administration for Market Regulation to prohibit our proposed merger with DouYu in 2021, we have not been subject to any regulatory actions or investigations in connection with anti-monopoly and we do not expect that the Guideline will have a material impact on our business. However, there remains uncertainties as to how these guidelines and the revised Anti-Monopoly Law will be implemented, and we cannot assure you that the governmental authorities will not take an opposite opinion. Any failure or perceived failure by us to comply with these guidelines and other anti-monopoly laws and regulations may result in governmental investigations or enforcement actions, litigation or claims against us and could have an adverse effect on our business, financial condition and results of operations. 54 Table of Contents Currently there is no law or regulation specifically governing virtual asset property rights and therefore it is not clear what liabilities, if any, online game operators may have for virtual assets. While participating on our platform, our users acquire, purchase and accumulate some virtual assets, such as gifts or certain status. Such virtual assets can be important to users and have monetary value and, in some cases, are sold for actual money. In practice, virtual assets can be lost for various reasons, often through unauthorized use of the user account of one user by other users and occasionally through data loss caused by delays of network service, network crashes, or hacking activities. Apart from the Civil Code of China, which was passed by the National People’s Congress on May 28, 2020 and became effective on January 1, 2021, prescribing the protection of network virtual property according to the laws and regulations stipulating the protection of such property, the government of mainland China has not yet enacted any specific laws regarding virtual property rights. As a result, there is uncertainty as to who the legal owner of virtual assets is, whether and how the ownership of virtual assets is protected by law, and whether an operator of live streaming platform such as us would have any liability, whether in contract, tort or otherwise, to users or other interested parties, for loss of such virtual assets. Based on recent court judgments in mainland China, the courts have typically held online platform operators liable for losses of virtual assets by platform users and ordered online platform operators to return the lost virtual items to users or pay damages and losses. In case of a loss of virtual assets, we may be sued by our users and held liable for damages, which may negatively affect our reputation and business, financial condition and results of operations. Advertisements shown on our platform may subject us to penalties and other administrative actions. Under the advertising laws and regulations in mainland China, we are obligated to monitor the advertising content shown on our platform to ensure that such content is true and accurate and in full compliance with applicable laws and regulations. In addition, where a special government review is required for specific types of advertisements prior to internet posting, such as advertisements relating to pharmaceuticals, medical instruments, agrochemicals and veterinary pharmaceuticals, we are obligated to confirm that such review has been performed and approval has been obtained. Violation of these laws and regulations may subject us to penalties, including fines, confiscation of our advertising income, orders to cease dissemination of the advertisements and orders to publish an announcement correcting the misleading information. In circumstances involving serious violations by us, governmental authorities of mainland China may force us to terminate our advertising operations or revoke our licenses. In addition to the advertisements that were placed by the advertising agencies or advertisers we directly cooperate with, our platform also displays side-bar advertisements placed by broadcasters on their own streaming channels and offers native advertisements in cooperation with broadcasters. While we have made significant efforts to ensure that the advertisements shown on our platform are in full compliance with applicable laws and regulations of mainland China, we cannot assure you that all the content contained in such advertisements or offers is true and accurate as required by the advertising laws and regulations. If we are found to be in violation of applicable advertising laws and regulations of mainland China, we may be subject to penalties and our reputation may be harmed, which may have a material adverse effect on our business, financial condition, results of operations and prospects. Under the enterprise income tax law of mainland China, we may be classified as a mainland China “resident enterprise,” which could result in unfavorable tax consequences to us and our shareholders and have a material adverse effect on our results of operations and the value of your investment. Under the PRC Enterprise Income Tax Law and its implementation rules and administrative measures, an enterprise established outside mainland China with “de facto management bodies” within the People’s Republic of China is considered a “resident enterprise” for mainland China enterprise income tax purposes and is generally subject to a uniform 25% enterprise income tax rate on its worldwide income. Although certain rules and measures issued by the State Administration of Taxation provide the definition of and the determination criteria for “de facto management bodies,” they only apply to offshore incorporated enterprises controlled by mainland China enterprises or mainland China enterprise group instead of those controlled by mainland China individuals or foreigners. Commerce & Finance Law Offices, our legal counsel as to mainland China law, has advised us that the determination criteria set forth therein may reflect the general position of the State Administration of Taxation on how the term “de facto management body” could be applied in determining the tax resident status of offshore enterprises, regardless of whether they are controlled by mainland China enterprises, individuals or foreigners. 55 Table of Contents Furthermore, we do not meet all of the conditions as set forth in these rules and measures, and therefore, we believe that we should not be treated as a “resident enterprise” for mainland China tax purposes even if the standards for “de facto management body” prescribed in this notice are applicable to us. For example, our minutes and files of the resolutions of our board of directors and the resolutions of our shareholders are maintained outside mainland China. However, it is possible that the mainland China tax authorities may take a different view. Commerce & Finance Law Offices, our legal counsel as to mainland China law, has advised us that if the mainland China tax authorities determine that our Cayman Islands holding company is a mainland China resident enterprise for mainland China enterprise income tax purposes, our world-wide income could be subject to mainland China tax at a rate of 25%, which could reduce our net income. In addition, we will also be subject to mainland China enterprise income tax reporting obligations. Although dividends paid by one mainland China tax resident to another mainland China tax resident should qualify as “tax-exempt income” under the enterprise income tax law, we cannot assure you that dividends by our mainland China subsidiary to our Cayman Islands holding company will not be subject to a 10% withholding tax, as the mainland China foreign exchange control authorities, which enforce the withholding tax on dividends, and the mainland China tax authorities have not yet issued guidance with respect to the processing of outbound remittances to entities that are treated as resident enterprises for mainland China enterprise income tax purposes. Non-mainland China resident ADS holders may also be subject to mainland China withholding tax on dividends paid by us and mainland China tax on gains realized on the sale or other disposition of ADSs or Class A ordinary shares, if such income is sourced from within mainland China. The tax would be imposed at the rate of 10% in the case of non-mainland China resident enterprise holders and 20% in the case of non-mainland China resident individual holders. In the case of dividends, we would be required to withhold the tax at source. Any mainland China tax liability may be reduced under applicable tax treaties or similar arrangements. Although our holding company is incorporated in the Cayman Islands, it remains unclear whether dividends received and gains realized by our non-mainland China resident ADS holders will be regarded as income from sources within mainland China if we are classified as a mainland China resident enterprise. Any such tax will reduce the returns on your investment in our ADSs. Finally, we face uncertainties on the reporting and consequences on private equity financing transactions, private share transfers and share exchange involving the transfer of shares in our company by non-resident investors. According to the Notice on Several Issues Concerning Enterprise Income Tax for Indirect Share Transfer by Non-PRC Resident Enterprises, issued by the State Administration of Taxation on February 3, 2015, an “indirect transfer” of assets of a mainland China resident enterprise, including a transfer of equity interests in a non-mainland China holding company of a mainland China resident enterprise, by non-mainland China resident enterprises may be re-characterized and treated as a direct transfer of mainland China taxable properties, if such transaction lacks reasonable commercial purpose and was undertaken for the purpose of reducing, avoiding or deferring mainland China enterprise income tax. As a result, gains derived from such indirect transfer may be subject to mainland China enterprise income tax, and tax filing or withholding obligations may be triggered, depending on the nature of the mainland China taxable properties being transferred. With respect to an indirect offshore transfer of assets of a mainland China establishment or place of business of a foreign enterprise, the resulting gain is to be included with the annual enterprise filing of the mainland China establishment or place of business being transferred and would consequently be subject to mainland China enterprise income tax at a rate of 25%. Where the underlying transfer relates to mainland China real properties or to equity investments in a mainland China resident enterprise, which is not related to a mainland China establishment or place of business of a non-resident enterprise, a mainland China enterprise income tax at 10% would apply, subject to available preferential tax treatment under applicable tax treaties or similar arrangements, and the party who is obligated to make the transfer payments has the withholding obligation. Where the payer fails to withhold any or sufficient tax, the transferor shall declare and pay such tax to the competent tax authority by itself within the statutory time limit. Late payment of applicable tax will subject the transferor to default interest. Currently, this notice does not apply to the sale of shares by investors through a public stock exchange where such shares were acquired from a transaction through a public stock exchange. We cannot assure you that the tax authorities of mainland China will not, at their discretion, adjust any capital gains and impose tax return filing and withholding or tax payment obligations with respect to any internal restructuring, and our subsidiaries in mainland China may be requested to assist in the filing. Any tax of mainland China imposed on a transfer of our shares not through a public stock exchange, or any adjustment of such gains would cause us to incur additional costs and may have a negative impact on the value of your investment in our company. 56 Table of Contents The M&A Rules and certain other regulations in mainland China establish complex procedures for certain acquisitions of Chinese companies by foreign investors, which could make it more difficult for us to pursue growth through acquisitions in mainland China. The Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors, or the M&A Rules, and other adopted regulations and rules concerning mergers and acquisitions, such as the Anti-Monopoly Law last amended on June 24, 2022, the Rules of the State Council on Declaration Threshold for Concentration of Undertakings last amended on January 22, 2024 and the Provisions on the Review of Concentrations of Undertakings issued on March 10, 2023, established additional procedures and requirements that could make merger and acquisition activities by foreign investors more time consuming and complex. See “Item 4. Information on the Company—B. Business Overview—Government Regulations—M&A Regulations and Overseas Listings.” On July 10, 2021, the State Administration for Market Regulation decided to prohibit our proposed merger with DouYu following its antitrust review. Accordingly, on July 12, 2021, the proposed merger was terminated. In the future, we may grow our business by acquiring complementary businesses. Complying with the requirements of applicable regulations to complete such transactions could be time consuming, and any required approval processes, including clearing the antitrust review conducted by State Administration for Market Regulation and obtaining approval from the Ministry of Commerce or its local counterparts may delay or inhibit our ability to complete such transactions. We believe that it is unlikely that our business would be deemed to be in an industry that raises “national defense and security” or “national security” concerns. However, the Ministry of Commerce or other government agencies may publish explanations in the future determining that our business is in an industry subject to the security review, in which case our future acquisitions in mainland China, including those by way of entering into contractual control arrangements with target entities, may be closely scrutinized or prohibited. The regulations in mainland China relating to offshore investment activities by mainland China residents may limit the ability of our subsidiaries in mainland China to increase their registered capital or distribute profits to us or otherwise expose us to liability and penalties under law of mainland China. The PRC State Administration of Foreign Exchange promulgated the Circular on Relevant Issues Relating to Domestic Resident’s Investment and Financing and Round-trip Investment through Special Purpose Vehicles in July 2014 that requires mainland China residents or entities to register with the State Administration of Foreign Exchange or its local branch in connection with their establishment or control of an offshore entity established for the purpose of overseas investment or financing. In addition, such mainland China residents or entities must update their registrations with the State Administration of Foreign Exchange when the offshore special purpose vehicle undergoes material events relating to any change of basic information (including change of such mainland China citizens or residents, name and operation term), increases or decreases in investment amount, transfers or exchanges of shares, or mergers or divisions. According to the Notice on Further Simplifying and Improving Policies for the Foreign Exchange Administration of Direct Investment released on February 13, 2015 and amended on December 30, 2019 by the State Administration of Foreign Exchange, local banks examines and handles foreign exchange registration for overseas direct investment, including the initial foreign exchange registration and amendment registration, under the circular above from June 1, 2015. If our shareholders who are mainland China residents or entities do not complete their registration with the local branches of the State Administration of Foreign Exchange, our subsidiaries in mainland China may be prohibited from distributing their profits and proceeds from any reduction in capital, share transfer or liquidation to us, and we may be restricted in our ability to contribute additional capital to our subsidiaries in mainland China. Moreover, failure to comply with the registration described above could result in liability under laws of mainland China for evasion of applicable foreign exchange restrictions. We may not at all times be fully aware or informed of the identities of all our shareholders or beneficial owners that are required to make such registrations, and we cannot compel our beneficial owners to comply with the registration requirements. As a result, we cannot assure you that all of our shareholders or beneficial owners who are mainland China residents or entities have complied with, and will in the future make or obtain any applicable registrations or approvals required by, the laws and regulations. Failure by such shareholders or beneficial owners to comply with laws and regulations, or failure by us to amend the foreign exchange registrations of our subsidiaries in mainland China, could subject us to fines or legal sanctions, restrict our overseas or cross-border investment activities, limit our subsidiaries’ ability to make distributions or pay dividends or affect our ownership structure, which could adversely affect our business and prospects. 57 Table of Contents The regulation in mainland China of direct investment and loans by offshore holding companies to mainland China entities may delay or limit us from using offshore assets, including the proceeds of our initial public offering, to make additional capital contributions or loans to our subsidiaries in mainland China. We are an offshore holding company conducting our operations in mainland China through our subsidiaries in mainland China, the variable interest entity and its subsidiaries. We may make loans to our mainland China subsidiary, the variable interest entity and its subsidiaries, or we may make additional capital contributions to our subsidiaries in mainland China. Any loans by us to our subsidiaries in mainland China, which are treated as foreign-invested enterprises under law of mainland China, are subject to regulations and foreign exchange loan registrations of mainland China. For example, loans by us to our mainland China subsidiaries to finance its activities cannot exceed statutory limits and must be registered with the competent local counterpart of the State Administration of Foreign Exchange, or filed with the State Administration of Foreign Exchange in its information system. We may also decide to finance our subsidiaries in mainland China by means of capital contributions. These capital contributions must be filed with the Ministry of Commerce and the State Administration for Market Regulation, or their local counterparts. Due to the restrictions imposed on loans in foreign currencies extended to any mainland China domestic companies, we are not likely to make such loans to the VIE and the VIE’s subsidiaries, which are mainland China domestic companies. Furthermore, we are not likely to finance the activities of the VIE and the VIE’s subsidiaries by means of capital contributions due to regulatory restrictions relating to foreign investment in mainland China domestic enterprises engaged in internet content services. Pursuant to the Circular on the Reforming of the Management Method of the Settlement of Foreign Currency Capital of Foreign-Invested Enterprises, which became effective on June 1, 2015, and the Circular of the State Administration of Foreign Exchange on Reforming and Regulating Policies on the Control over Foreign Exchange Settlement of Capital Accounts, which was promulgated in June 2016, foreign-invested enterprises may either continue to follow the current payment-based foreign currency settlement system or choose to follow the “conversion-at-will” system for foreign currency settlement. These regulations, therefore, have substantially lifted the restrictions on the usage by a foreign-invested enterprise of its Renminbi registered capital, foreign debt and repatriated funds raised through overseas listing converted from foreign currencies. According to these regulations, foreign-invested enterprises can use these Renminbi capital, foreign debt and repatriated funds raised through overseas listing at their discretion and the State Administration of Foreign Exchange will eliminate the prior approval requirement and only examine the authenticity of the declared usage afterwards. Nevertheless, it is still unclear whether foreign-invested enterprises, such as our subsidiaries in mainland China, are permitted to provide intercompany loans to the VIE and the VIE’s subsidiaries. In addition, the State Administration of Foreign Exchange promulgated the Circular Regarding Further Promotion of the Facilitation of Cross-Border Trade and Investment on October 23, 2019, pursuant to which all foreign-invested enterprises can make equity investments in mainland China with their capital funds in accordance with the law. Furthermore, on September 12, 2025, the State Administration of Foreign Exchange promulgated the Circular Regarding Matters Concerning Deepening the Reform of Foreign Exchange Administration for Cross-Border Investment and Financing, or SAFE Circular 43, which became effective on the same day. SAFE Circular 43 provides that registration procedures are not required to complete when foreign-invested enterprises use their foreign exchange capital and the Renminbi funds obtained from its settlement for domestic reinvestment in mainland China, and the relevant funds for such domestic reinvestment may be directly transferred to the relevant accounts, on the condition that the special administrative measures for foreign investment access are not violated and such investment project is genuine and compliant. As the relevant government authorities have certain discretion in interpreting the regulation, there still remains uncertainties regarding the use of these capital funds for equity investments in mainland China in practice. See “Item 4. Information on the Company—B. Business Overview—Government Regulations—Regulations on Foreign Currency Exchange and Dividend Distribution.” In light of the various requirements imposed by regulations of mainland China on loans to and direct investment in mainland China entities by offshore holding companies, we cannot assure you that we will be able to complete the necessary registration or obtain the necessary approval on a timely basis, or at all. If we fail to complete the necessary registration or obtain the necessary approval, our ability to make loans or equity contributions to our subsidiaries in mainland China may be negatively affected, which could adversely affect the liquidity of our subsidiaries in mainland China and the ability of our subsidiaries in mainland China to fund its working capital and expansion projects and meet its obligations and commitments. 58 Table of Contents Failure to comply with regulations of mainland China regarding the registration requirements for employee stock ownership plans or share option plans may subject the plan participants in mainland China or us to fines and other legal or administrative sanctions. Pursuant to the Circular on Relevant Issues Relating to Domestic Resident’s Investment and Financing and Roundtrip Investment through Special Purpose Vehicles, mainland China residents who participate in share incentive plans in overseas non-publicly-listed companies may submit applications to the PRC State Administration of Foreign Exchange or its local branches for the foreign exchange registration with respect to offshore special purpose companies. In the meantime, our directors, executive officers and other employees who are mainland China citizens or who are non-mainland China residents residing in mainland China for a continuous period of not less than one year, subject to limited exceptions, and who have been granted incentive share awards by us, may follow the Notices on Issues Concerning the Foreign Exchange Administration for Domestic Individuals Participating in Stock Incentive Plan of Overseas Publicly-Listed Company, promulgated by the State Administration of Foreign Exchange in 2012. Pursuant to this regulation, mainland China citizens and non-mainland China citizens who reside in mainland China for a continuous period of not less than one year who participate in any stock incentive plan of an overseas publicly listed company, subject to a few exceptions, are required to register with the State Administration of Foreign Exchange through a domestic qualified agent, which could be the mainland China subsidiaries of such overseas listed company, and complete certain other procedures. In addition, an overseas entrusted institution must be retained to handle matters in connection with the exercise or sale of stock options and the purchase or sale of shares and interests. We and our executive officers and other employees who are mainland China citizens or who reside in mainland China for a continuous period of not less than one year and who have been granted options are subject to these regulations when our company became an overseas listed company. Failure to complete the registrations with the State Administration of Foreign Exchange may subject them to fines, and legal sanctions and may also limit our ability to contribute additional capital into our subsidiaries in mainland China and limit the ability of our subsidiaries in mainland China to distribute dividends to us. We also face regulatory uncertainties that could restrict our ability to adopt additional incentive plans for our directors, executive officers and employees under law of mainland China. See “Item 4. Information on the Company—B. Business Overview—Government Regulations—Regulations on Foreign Currency Exchange and Dividend Distribution—Stock option rules.” The State Administration of Taxation has issued certain circulars concerning employee share options and restricted shares. Under these circulars, our employees working in mainland China who exercise share options or are granted restricted shares will be subject to individual income tax of mainland China. Our subsidiaries in mainland China have obligations to file documents related to employee share options or restricted shares with tax authorities and to withhold individual income taxes of those employees who exercise their share options. If our employees fail to pay or we fail to withhold their income taxes according to the laws and regulations, we may face sanctions imposed by the tax authorities or other mainland China governmental authorities. See “Item 4. Information on the Company—B. Business Overview—Government Regulations—Regulations on Foreign Currency Exchange and Dividend Distribution—Stock option rules” It may be difficult for overseas regulators to conduct investigations or collect evidence within mainland China. Shareholder claims or regulatory investigations may face procedural complexities when pursued in mainland China. Although the authorities in mainland China may establish a regulatory cooperation mechanism with the securities regulatory authorities of another country or region to implement cross-border supervision and administration, such cooperation with the securities regulatory authorities in the United States or other jurisdictions may not be efficient in the absence of a mutual and practical cooperation mechanism. Furthermore, according to Article 177 of the PRC Securities Law, which became effective in March 2020, no overseas securities regulator is allowed to directly conduct investigation or evidence collection activities within the territory of mainland China, and without the consent by the Chinese securities regulatory authorities and the other competent governmental agencies, no entity or individual may provide documents or materials related to securities business to any foreign party. While detailed interpretation of or implementation rules under Article 177 of the PRC Securities Law have yet to be promulgated, the inability of an overseas securities regulator to directly conduct investigation or evidence collection activities within mainland China and the potential obstacles for information provision may further increase difficulties you face in protecting your interests. See also “—Risks Related to Our ADSs—You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because we are incorporated under Cayman Islands law” for risks associated with investing in us as a Cayman Islands company. 59 Table of Contents Fluctuations in exchange rates could have a material adverse effect on our results of operations and the value of your investment. The conversion of Renminbi into foreign currencies, including U.S. dollars, is based on rates set by the People’s Bank of China. The Renminbi has fluctuated against the U.S. dollar, at times significantly and unpredictably. The value of Renminbi against the U.S. dollar and other currencies is affected by changes in political and economic conditions of mainland China and by foreign exchange policies of mainland China, among other things. We cannot assure you that Renminbi will not appreciate or depreciate significantly in value against the U.S. dollar in the future. It is difficult to predict how market forces or China or U.S. government policy may impact the exchange rate between Renminbi and the U.S. dollar in the future. Any significant appreciation or depreciation of Renminbi may materially and adversely affect our revenues, earnings and financial position, and the value of, and any dividends payable on, our ADSs in U.S. dollars. For example, to the extent that we need to convert U.S. dollars we receive into Renminbi to pay our operating expenses, appreciation of Renminbi against the U.S. dollar would have an adverse effect on the RMB amount we would receive from the conversion. Conversely, a significant depreciation of Renminbi against the U.S. dollar may significantly reduce the U.S. dollar equivalent of our earnings, which in turn could adversely affect the price of our ADSs. Very limited hedging options are available in mainland China to reduce our exposure to exchange rate fluctuations. To date, we have not entered into any hedging transactions in an effort to reduce our exposure to foreign currency exchange risk. While we may decide to enter into hedging transactions in the future, the availability and effectiveness of these hedges may be limited and we may not be able to adequately hedge our exposure or at all. In addition, our currency exchange losses may be magnified by exchange control regulations of mainland China that restrict our ability to convert Renminbi into foreign currency. As a result, fluctuations in exchange rates may have a material adverse effect on your investment. Governmental regulation of currency conversion may limit our ability to utilize our revenues effectively and affect the value of your investment. We receive substantially all of our revenues in Renminbi. Under existing foreign exchange regulations of mainland China, payments of current account items, including profit distributions, interest payments and trade and service-related foreign exchange transactions, can be made in foreign currencies without prior approval from the State Administration of Foreign Exchange or banks designated by the State Administration of Foreign Exchange by complying with certain procedural requirements. Therefore, our subsidiaries in mainland China are able to pay dividends in foreign currencies to us without prior approval from the State Administration of Foreign Exchange. However, approval from or registration with appropriate government authorities is required where Renminbi is to be converted into foreign currency and remitted out of mainland China to pay capital expenses such as the repayment of loans denominated in foreign currencies. The government of mainland China may also at its discretion manage access to foreign currencies for current account transactions in the future. If the foreign exchange management system prevents us from obtaining sufficient foreign currencies to satisfy our foreign currency demands, we may not be able to pay dividends in foreign currencies to our shareholders, including holders of our ADSs. If the custodians or authorized users of controlling non-tangible assets of our company, including our corporate chops and seals, fail to fulfill their responsibilities, or misappropriate or misuse these assets, our business and operations could be materially and adversely affected. Under law of mainland China, legal documents for corporate transactions are executed using the chops or seal of the signing entity or with the signature of a legal representative whose designation is registered and filed with the branch of the Administration of Industry and Commerce. 60 Table of Contents Although we usually utilize chops to enter into contracts, the designated legal representatives of each of our subsidiaries in mainland China, the variable interest entity and its subsidiaries have the apparent authority to enter into contracts on behalf of such entities without chops and bind such entities. All designated legal representatives of our subsidiaries in mainland China, the variable interest entity and its subsidiaries are members of our senior management team who have signed employment agreements with us or our subsidiaries in mainland China, the variable interest entity and its subsidiaries under which they agree to abide by various duties they owe to us. In order to maintain the physical security of our chops and chops of our entities in mainland China, we generally store these items in secured locations accessible only by the authorized personnel in the legal or finance department of each of our subsidiaries and variable interest entity (including its subsidiaries). Although we monitor such authorized personnel, there is no assurance such procedures will prevent all instances of abuse or negligence. Accordingly, if any of our authorized personnel misuse or misappropriate our corporate chops or seals, we could encounter difficulties in maintaining control over the entities and experience significant disruption to our operations. If a designated legal representative obtains control of the chops in an effort to obtain control over any of our subsidiaries in mainland China, the variable interest entity or its subsidiaries, we or our subsidiaries in mainland China, the variable interest entity and its subsidiaries would need to pass a new shareholder or board resolution to designate a new legal representative and we would need to take legal action to seek the return of the chops, apply for new chops with the authorities, or otherwise seek legal redress for the violation of the representative’s fiduciary duties to us, which could involve significant time and resources and divert management attention away from our regular business. In addition, the affected entity may not be able to recover corporate assets that are sold or transferred out of our control in the event of such a misappropriation if a transferee relies on the apparent authority of the representative and acts in good faith. Our leased property interest may be defective and our right to lease the properties affected by such defects challenged, which could cause significant disruption to our business. Under laws of mainland China, all lease agreements are required to be registered with the local housing authorities. We presently lease nine premises in mainland China, and the landlords of these premises have not completed the registration of their ownership rights or the registration of our leases with the authorities. Failure to complete these required registrations may expose our landlords, lessors and us to potential monetary fines. If these registrations are not obtained in a timely manner or at all, we may be subject to monetary fines or may have to relocate our offices and incur the associated losses. Risks Related to Our ADSs The trading price of our ADSs has been volatile and may be volatile regardless of our operating performance. The trading price of our ADSs has been volatile. The trading price of our ADSs could fluctuate widely due to factors beyond our control. This may happen because of broad market and industry factors, including the performance and fluctuation of the market prices of other companies with business operations located mainly in mainland China that have listed their securities in the United States. Furthermore, the stock market in general has experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of companies like us. These broad market and industry factors may materially reduce the market price of our ADSs, regardless of our operating performance. In addition to market and industry factors, the price and trading volume for our ADSs may be highly volatile for factors specific to our own operations, including the following: ● variations in our revenues, earnings, cash flow and operating metrics; ● announcements of new investments, acquisitions, strategic partnerships or joint ventures by us or our competitors; ● announcements of new product and service offerings, solutions and expansions by us or our competitors; ● changes in financial estimates by securities analysts; ● regulatory developments affecting us or our industry; ● our controlling shareholder’s business performance and the trading price of its stock; ● detrimental adverse publicity about us, our shareholders, affiliates, directors, officers or employees, our content offerings, our business model, our services or our industry; 61 Table of Contents ● announcements of new regulations, rules or policies relevant for our business; ● any share repurchase program or dividend declarations; ● additions or departures of key personnel; and ● potential litigation or regulatory investigations. Any of these factors may result in large and sudden changes in the volume and price at which our ADSs will trade. In addition, the stock market in general experiences price and volume fluctuations that are often unrelated or disproportionate to the operating performance of individual companies. These market and industry fluctuations may significantly affect the trading prices of our listed securities. In the past, shareholders of public companies have often brought securities class action suits against those companies following periods of instability in the market price of their securities. If we were involved in a class action suit, it could divert a significant amount of our management’s attention and other resources from our business and operations and require us to incur significant expenses to defend the suit, which could harm our results of operations. Any such class action suit, whether or not successful, could harm our reputation and restrict our ability to raise capital in the future. In addition, if a claim is successfully made against us, we may be required to pay significant damages, which could have a material adverse effect on our financial condition and results of operations. Our dual-class share structure with different voting rights will limit your ability to influence corporate matters and could discourage others from pursuing any change of control transactions that holders of our Class A ordinary shares and ADSs may view as beneficial. We have a dual-class share structure such that our ordinary shares consist of Class A ordinary shares and Class B ordinary shares. With respect to matters requiring the votes of shareholders, holders of Class A ordinary shares are entitled to one vote per share, while holders of Class B ordinary shares are entitled to ten votes per share based on our dual-class share structure. Each Class B ordinary share is convertible into one Class A ordinary share at any time by the holder thereof, while Class A ordinary shares are not convertible into Class B ordinary shares under any circumstances. Upon any sale, transfer, assignment or disposition of any Class B ordinary shares by a holder to any person or entity who is not an affiliate of such holder, or upon a change of ultimate beneficial ownership of any Class B ordinary shares to any person or entity who is not an affiliate of the holder of such Class B ordinary shares, such Class B ordinary shares shall be automatically and immediately converted into the equivalent number of Class A ordinary shares. As of March 31, 2026, Tencent, our controlling shareholder, beneficially owned all of our issued and outstanding Class B ordinary shares, which constituted 65.4% of our total issued and outstanding share capital and 95.0% of the aggregate voting power of our total issued and outstanding share capital due to the disparate voting powers associated with our dual-class share structure. As a result of the dual-class share structure and the concentration of ownership, the holder of Class B ordinary shares will have considerable influence over matters such as decisions regarding mergers, consolidations and the sale of all or substantially all of our assets, election of directors and other significant corporate actions. Such holder may take actions that are not in the best interest of us or our other shareholders. This concentration of ownership may discourage, delay or prevent a change in control of our company, which could have the effect of depriving our other shareholders of the opportunity to receive a premium for their shares as part of a sale of our company and may reduce the price of our ADSs. This concentrated control will limit your ability to influence corporate matters and could discourage others from pursuing any potential merger, takeover or other change of control transactions that holders of Class A ordinary shares and ADSs may view as beneficial. The dual-class structure of our ordinary shares may adversely affect the trading market for our ADSs. S&P Dow Jones and FTSE Russell have announced changes to their eligibility criteria for inclusion of shares of public companies on certain indices, including the S&P 500, to exclude companies with multiple classes of shares and companies whose public shareholders hold no more than 5% of total voting power from being added to such indices. In addition, several shareholder advisory firms have announced their opposition to the use of multiple class structures. As a result, the dual class structure of our ordinary shares may prevent the inclusion of our ADSs representing Class A ordinary shares in such indices and may cause shareholder advisory firms to publish negative commentary about our corporate governance practices or otherwise seek to cause us to change our capital structure. The exclusion from indices could result in a less active trading market for our ADSs. Any actions or publications by shareholder advisory firms critical of our corporate governance practices or capital structure could also adversely affect the value of our ADSs. 62 Table of Contents We believe that we were likely a passive foreign investment company for U.S. federal income tax purposes for the taxable year ended December 31, 2025, which could subject U.S. investors to adverse U.S. federal income tax consequences. We will be a passive foreign investment company (“PFIC”) for a taxable year if either (a) 75% or more of our gross income for such year consists of certain types of “passive” income or (b) 50% or more of the average quarterly value of our assets (generally determined on the basis of a quarterly average) during such year produce or are held for the production of passive income. Passive income generally includes dividends, interest, royalties, rents, annuities, net gains from the sale or exchange of property producing such income and net foreign currency gains. For this purpose, cash and assets readily convertible into cash are generally categorized as passive assets, and goodwill and other unbooked intangibles associated with active business activity are generally taken into account as non-passive assets. We will be treated as owning our proportionate share of the assets and earning our proportionate share of the income of any other corporation in which we own, directly or indirectly, at least 25% (by value) of the stock. Although the law in this regard is unclear, we treat the variable interest entity (including its subsidiaries) as being owned by us for U.S. federal income tax purposes, not only because we exercise effective control over the operations of such entities, but also because we are entitled to substantially all of their economic benefits, and, as a result, we consolidate their results of operations in our consolidated financial statements. Based upon the nature and composition of our assets (in particular the retention of a substantial amount of cash, deposits, and investments), and the market price of our ADSs, we believe that we were likely a PFIC for U.S. federal income tax purposes for the taxable year ended December 31, 2025, and that we will likely be a PFIC for our current taxable year unless the market price of our ADSs increases and/or we invest a substantial amount of the cash and other passive assets we hold in assets that produce or are held for the production of active income. If we are a PFIC for any taxable year, a U.S. holder, as defined in “Item 10. Additional Information-E. Taxation-U.S. Federal Income Tax Considerations,” will generally be subject to burdensome reporting requirements and may incur significantly increased U.S. federal income tax on gain recognized on the sale or other disposition of our ADSs or Class A ordinary shares and on the receipt of distributions on our ADSs or Class A ordinary shares to the extent such distribution is treated as an “excess distribution” under the U.S. federal income tax rules. Furthermore, if we are a PFIC for any year during which a U.S. holder holds our ADSs or Class A ordinary shares, we will generally continue to be treated as a PFIC for all succeeding years during which such U.S. holder holds our ADSs or Class A ordinary shares, unless we were to cease to be a PFIC and the U.S. holder were to make a “deemed sale” election with respect to our ADSs or Class A ordinary shares. For more information, see “Item 10. Additional Information—E. Taxation—U.S. Federal Income Tax Considerations” and “Item 10. Additional Information—E. Taxation—U.S. Federal Income Tax Considerations—Passive Foreign Investment Company Rules.” If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, the market price for our ADSs and trading volume could decline. The trading market for our ADSs depends in part on the research and reports that securities or industry analysts publish about us or our business. If research analysts do not maintain adequate research coverage or if one or more of the analysts who covers us downgrades our ADSs or publishes inaccurate or unfavorable research about our business, the market price for our ADSs would likely decline. If one or more of these analysts cease coverage of our company or fail to publish reports on us regularly, we could lose visibility in the financial markets, which, in turn, could cause the market price of or trading volume for our ADSs to decline. 63 Table of Contents Because the amount, timing, and whether or not we distribute dividends at all is entirely at the discretion of our board of directors, you must rely on price appreciation of our ADSs for return on your investment. We declared a special cash dividend on March 19, 2024 of US$0.66 per ordinary share, or US$0.66 per ADS, to holders of ordinary shares and holders of ADSs of record as of the close of business on May 10, 2024, and distributed such dividend in May 2024 in a total amount of approximately US$150 million. In addition, we declared a special cash dividend on August 13, 2024 of US$1.08 per ordinary share, or US$1.08 per ADS, to holders of ordinary shares and holders of ADSs of record as of the close of business on October 9, 2024, and distributed such dividend in October 2024 in a total amount of approximately US$250 million. In March 2025, our board approved the 2025-2027 Dividend Plan for the purpose of enhancing shareholder returns and optimizing our capital structure. The 2025-2027 Dividend Plan consists of the 2025 Cash Dividend, the 2026 Cash Dividend and the Expected 2027 Dividend. We distributed the 2025 Cash Dividend to the holders of our ordinary shares and holders of our ADSs in June 2025. The total amount of the 2025 Cash Dividend was approximately US$340 million, which was funded by surplus cash on our balance sheet. In addition, our board approved the 2026 Cash Dividend in March 2026, which will be paid to the holders of our ordinary shares and holders of our ADSs as of the close of business on June 17, 2026, in U.S. dollars, in an amount of US$0.135 per ordinary share or US$0.135 per ADS. The total amount of cash to be distributed for the 2026 Cash Dividend is expected to be approximately US$31 million, which will be funded by surplus cash on our balance sheet. The aggregate amount of the Expected 2027 Dividend is expected to be no less than US$30 million. With respect to the Expected 2027 Dividend, our board reserves full discretion relating to the determination to make such dividend distribution and the amount, timing, and other specifics of such distribution. Our board of directors has complete discretion as to whether to distribute dividends. If our board of directors decides to declare and pay dividends, the timing, amount, and form of future dividends, if any, will depend on, among other things, our future results of operations and cash flow, our capital requirements and surplus, the amount of distributions, if any, that we receive from our subsidiaries, our financial condition, contractual restrictions, and other factors deemed relevant by our board of directors. Accordingly, the return on your investment in our ADSs will likely depend entirely upon any future price appreciation of our ADSs. There is no assurance that our ADSs will appreciate in value or even maintain the price at which you purchased the ADSs. You may not realize a return on your investment in our ADSs and you may even lose your entire investment in our ADSs. Substantial future sales or perceived potential sales of our ADSs in the public market could cause the price of our ADSs to decline. Certain holders of our ordinary shares may cause us to register under the Securities Act the sale of their shares, subject to the applicable lock-up period. Registration of these shares under the Securities Act would result in ADSs representing these shares becoming freely tradable without restriction under the Securities Act immediately upon the effectiveness of the registration. Sales of these registered shares in the form of ADSs in the public market could cause the price of our ADSs to decline. The voting rights of holders of ADSs are limited by the terms of the deposit agreement, and you may not be able to exercise your right to direct the voting of the underlying Class A ordinary shares which are represented by your ADSs. As a holder of our ADSs, you will only be able to exercise the voting rights with respect to the underlying Class A ordinary shares representing your ADSs in accordance with the provisions of the deposit agreement. Under the deposit agreement, you must vote by giving voting instructions to the depositary. Upon receipt of your voting instructions, the depositary will vote the underlying Class A ordinary shares representing your ADSs in accordance with these instructions. You will not be able to directly exercise your right to vote with respect to the underlying Class A ordinary shares representing your ADSs unless you withdraw the shares and become the registered holder of such shares prior to the record date for the general meeting. Under our fourth amended and restated memorandum and articles of association, the minimum notice period required for convening a general meeting is ten days. When a general meeting is convened, you may not receive sufficient advance notice enable you to withdraw the underlying Class A ordinary shares represented by your ADSs and become the registered holder of such shares prior to the record date of the general meeting to allow you to vote with respect to any specific matter. In addition, under our memorandum and articles of association, for the purposes of determining those shareholders who are entitled to attend and vote at any general meeting, our directors may close our register of members or fix in advance a record date for such meeting, and such closure of our register of members or the setting of such a record date may prevent you from withdrawing the Class A ordinary shares represented by your ADSs and becoming the registered holder of such shares prior to the record date, so that you would not be able to attend the general meeting or to vote directly. Where any matter is to be put to a vote at a general meeting, the depositary will use its best endeavors to notify you of the upcoming vote and to deliver our voting materials to you. We cannot assure you that you will receive the voting materials in time to ensure that you can instruct the depositary to vote your shares. In addition, the depositary and its agents are not responsible for failing to carry out voting instructions or for their manner of carrying out your voting instructions. This means that you may not be able to exercise your right to vote and you may have no legal remedy if the underlying Class A ordinary shares represented by your ADSs are not voted as you requested. 64 Table of Contents Except in limited circumstances, the depositary for our ADSs will give us a discretionary proxy to vote the Class A ordinary shares underlying your ADSs if you do not vote at shareholders’ meetings, which could adversely affect your interests. Under the deposit agreement for the ADSs, if you do not timely and properly give voting instructions to the depository as to how to vote the underlying Class A ordinary shares represented by your ADSs, the depositary will give us or our nominee a discretionary proxy to vote the underlying Class A ordinary shares represented by your ADSs at shareholders’ meetings unless: ● we have failed to timely provide the depositary with notice of meeting and related voting materials; ● we have instructed the depositary that we do not wish a discretionary proxy to be given; ● we have informed the depositary that there is substantial opposition as to a matter to be voted on at the meeting; ● a matter to be voted on at the meeting would have a material adverse impact on shareholders; or ● the voting at the meeting is to be made on a show of hands. The effect of this discretionary proxy is that if you do not timely and properly give voting instructions to the depository as to how to vote the underlying Class A ordinary shares represented by your ADSs at shareholders’ meetings, you cannot prevent such underlying Class A ordinary shares represented by your ADSs from being voted, except under the circumstances described above. This may make it more difficult for shareholders to influence the management of our company. Holders of our ordinary shares are not subject to this discretionary proxy. Your rights to pursue claims against the depositary as a holder of ADSs are limited by the terms of the deposit agreement. Under the deposit agreement, any action or proceeding against or involving the depositary, arising out of or based upon the deposit agreement or the transactions contemplated thereby or by virtue of owning the ADSs may only be instituted in a state or federal court in New York, New York, and you, as a holder of our ADSs, will have irrevocably waived any objection which you may have to the laying of venue of any such proceeding, and irrevocably submitted to the exclusive jurisdiction of such courts in any such action or proceeding. The depositary may, in its sole discretion, require that any dispute or difference arising from the relationship created by the deposit agreement be referred to and finally settled by an arbitration conducted under the terms described in the deposit agreement, although the arbitration provisions do not preclude you from pursuing claims under federal securities laws in federal courts. Also, we may amend or terminate the deposit agreement without your consent. If you continue to hold your ADSs after an amendment to the deposit agreement, you agree to be bound by the deposit agreement as amended. Your right to participate in any future rights offerings may be limited, which may cause dilution to your holdings. We may from time to time distribute rights to our shareholders, including rights to acquire our securities. However, we cannot make such rights available to you in the United States unless we register both the rights and the securities to which the rights relate under the Securities Act or an exemption from the registration requirements is available. Under the deposit agreement, the depositary will not make rights available to you unless both the rights and the underlying securities to be distributed to ADS holders are either registered under the Securities Act or exempt from registration under the Securities Act. We are under no obligation to file a registration statement with respect to any such rights or securities or to endeavor to cause such a registration statement to be declared effective and we may not be able to establish a necessary exemption from registration under the Securities Act. Accordingly, you may be unable to participate in our rights offerings in the future and may experience dilution in your holdings. ​ 65 Table of Contents You may not receive dividends or other distributions on our Class A ordinary shares and you may not receive any value for them, if it is illegal or impractical to make them available to you. The depositary of our ADSs has agreed to pay to you the cash dividends or other distributions it or the custodian receives on Class A ordinary shares or other deposited securities underlying our ADSs, after deducting its fees and expenses. You will receive these distributions in proportion to the number of Class A ordinary shares your ADSs represent. However, the depositary is not responsible if it decides that it is unlawful or impractical to make a distribution available to any holders of ADSs. For example, it would be unlawful to make a distribution to a holder of ADSs if it consists of securities that require registration under the Securities Act but that are not properly registered or distributed under an applicable exemption from registration. The depositary may also determine that it is not feasible to distribute certain property through the mail. Additionally, the value of certain distributions may be less than the cost of mailing them. In these cases, the depositary may determine not to distribute such property. We have no obligation to register under U.S. securities laws any ADSs, ordinary shares, rights or other securities received through such distributions. We also have no obligation to take any other action to permit the distribution of ADSs, ordinary shares, rights or anything else to holders of ADSs. This means that you may not receive distributions we make on our Class A ordinary shares or any value for them if it is illegal or impractical for us to make them available to you. These restrictions may cause a material decline in the value of our ADSs. You may be subject to limitations on transfer of your ADSs. Your ADSs are transferable on the books of the depositary. However, the depositary may close its books at any time or from time to time when it deems expedient in connection with the performance of its duties. The depositary may close its books from time to time for a number of reasons, including in connection with corporate events such as a rights offering, during which time the depositary needs to maintain an exact number of ADS holders on its books for a specified period. The depositary may also close its books in emergencies, and on weekends and public holidays. The depositary may refuse to deliver, transfer or register transfers of our ADSs generally when our share register or the books of the depositary are closed, or at any time if we or the depositary thinks that it is advisable to do so because of any requirement of law or of any government or governmental body, or under any provision of the deposit agreement, or for any other reason in accordance with the terms of the deposit agreement. As a result, you may be unable to transfer your ADSs when you wish to. Certain judgments obtained against us by our shareholders may not be enforceable. We are an exempted company limited by shares incorporated under the laws of the Cayman Islands. We conduct substantially all of our operations in mainland China and substantially all of our assets are located in mainland China. In addition, a majority of our directors and executive officers reside within mainland China, and most of the assets of these persons are located within mainland China. As a result, it may be difficult or impossible for you to effect service of process within the United States upon these individuals, or to bring an action against us or against these individuals in the United States in the event that you believe your rights have been infringed under the U.S. federal securities laws or otherwise. Even if you are successful in bringing an action of this kind, the laws of the Cayman Islands and of mainland China may render you unable to enforce a judgment against our assets or the assets of our directors and officers. Our memorandum and articles of association contain anti-takeover provisions that could have a material adverse effect on the rights of holders of our Class A ordinary shares and ADSs. Our memorandum and articles of association contain certain provisions to limit the ability of others to acquire control of our company or cause us to engage in change-of-control transactions, including a dual-class structure and a provision that grants authority to our board of directors to establish and issue from time to time one or more series of preferred shares without action by our shareholders and to determine, with respect to any series of preferred shares without action by our shareholders and to determine, with respect to any series of preferred shares, the terms and rights of that series. These provisions could have the effect of depriving our shareholders and ADSs holders of the opportunity to sell their shares or ADSs at a premium over the prevailing market price by discouraging third parties from seeking to obtain control of our company in a tender offer or similar transactions. ​ 66 Table of Contents You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because we are incorporated under Cayman Islands law. We are an exempted company limited by shares incorporated under the laws of the Cayman Islands. Our corporate affairs are governed by our memorandum and articles of association, the Companies Act (As Revised) of the Cayman Islands and the common law of the Cayman Islands. The rights of shareholders to take action against the directors, actions by minority shareholders and the fiduciary duties of our directors to us under Cayman Islands law are to a large extent governed by the common law of the Cayman Islands. The common law of the Cayman Islands is derived in part from comparatively limited judicial precedent in the Cayman Islands as well as from the common law of England and Wales, the decisions of whose courts are of persuasive authority, but are not binding, on a court in the Cayman Islands. The rights of our shareholders and the fiduciary duties of our directors under Cayman Islands law are not as clearly established as they would be under statutes or judicial precedent in some jurisdictions in the United States. In particular, the Cayman Islands has a less developed body of securities laws than the United States. Some U.S. states, such as Delaware, have more fully developed and judicially interpreted bodies of corporate law than the Cayman Islands. In addition, with respect to Cayman Islands companies, plaintiffs may face special obstacles, including but not limited to those relating to jurisdiction and standing, in attempting to assert derivative claims in state or federal courts of the United States. Shareholders of Cayman Islands exempted companies like us have no general rights under Cayman Islands law to inspect corporate records (save for the memorandum and articles of association, the register of mortgages and charges, a list of the names of our current directors upon payment of fees to the Cayman Registrar and special resolutions of shareholders) or to obtain copies of lists of shareholders of these companies. Our directors have discretion under our memorandum and articles of association to determine whether or not, and under what conditions, our corporate records may be inspected by our shareholders, but are not obliged to make them available to our shareholders. This may make it more difficult for you to obtain the information needed to establish any facts necessary for a shareholder resolution or to solicit proxies from other shareholders in connection with a proxy contest. As a result of all of the above, our public shareholders may have more difficulty in protecting their interests in the face of actions taken by management, members of the board of directors or controlling shareholders than they would as public shareholders of a company incorporated in the United States. We have granted, and may continue to grant, share incentive awards, which may result in increased share-based compensation expenses. We adopted our stock incentive plan, or the 2017 Share Incentive Plan, in July 2017, for purposes of granting share-based compensation awards to employees, directors and consultants to incentivize their performance and align their interests with ours. We adopted an amended and restated 2017 share incentive plan in March 2018, or the Amended and Restated 2017 Plan. We account for compensation costs for all share options using a fair-value based method and recognize expenses in our consolidated statements of comprehensive loss in accordance with U.S. GAAP. Under the Amended and Restated 2017 Plan, we are authorized to grant options to purchase Class A ordinary shares of our company and restricted share units to receive Class A ordinary shares. The maximum number of Class A ordinary shares which may be issued pursuant to all awards under the Amended and Restated 2017 Plan is 28,394,117. As of March 31, 2026, options to purchase 72,500 Class A ordinary shares have been granted and are outstanding, and 956,845 restricted share units have been granted and are outstanding under the Amended and Restated 2017 Plan. We adopted the 2021 Share Incentive Plan, effective on June 22, 2021. We may only grant restricted share units pursuant to the 2021 Share Incentive Plan. We adopted an amended and restated 2021 share incentive plan in September 2022, or the Amended and Restated 2021 Plan. Under the Amended and Restated 2021 Plan, the maximum aggregate number of shares of our company available for grant of awards is 8,018,111 Class A ordinary shares. As of March 31, 2026, 1,000,327 restricted share units have been granted and are outstanding under the Amended and Restated 2021 Plan. We adopted the 2024 Share Incentive Plan, effective on December 22, 2024. We may grant both options and restricted shares units pursuant to the 2024 Share Incentive Plan. Under the 2024 Share Incentive Plan, the maximum aggregate number of shares of our company available for grant of awards is 15,846,000 Class A ordinary shares. As of March 31, 2026, options to purchase 4,562,919 Class A ordinary shares have been granted and are outstanding, and 3,679,699 restricted share units have been granted and are outstanding under the 2024 Share Incentive Plan. 67 Table of Contents For the fiscal year ended 2025, we recorded share-based compensation of RMB73.6 million (US$10.5 million), related to share incentive plans. On April 3, 2020, Linen Investment Limited exercised its option to acquire 16,523,819 Class B ordinary shares from JOYY Inc. and became our controlling shareholder. Pursuant to the 2017 Share Incentive Plan and option agreements with grantees, all of the share options shall be deemed vested and exercisable immediately in the event of a change of control, regardless of the vesting schedule. Accordingly, upon the aforementioned share transfer, options to purchase 8,343,527 Class A ordinary shares were deemed vested and exercisable immediately, and share-based compensation expense of RMB57.7 million was immediately recognized. We believe the granting of share incentive awards is of significant importance to our ability to attract and retain employees, and we will continue to grant share incentive awards to employees in the future. As a result, our expenses associated with share-based compensation may increase, which may have an adverse effect on our results of operations. We are a foreign private issuer within the meaning of the rules under the Exchange Act, and as such we are exempt from certain provisions applicable to U.S. domestic public companies. Because we qualify as a foreign private issuer under the Exchange Act, we are exempt from certain provisions of the securities rules and regulations in the United States that are applicable to U.S. domestic issuers, including: ● the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q or current reports on Form 8-K; ● the sections of the Exchange Act regulating the solicitation of proxies, consents, or authorizations with respect to a security registered under the Exchange Act; ● the sections of the Exchange Act requiring principal shareholders to file public reports of their stock ownership and trading activities and liability for insiders who profit from trades made in a short period of time; ● the selective disclosure rules by issuers of material nonpublic information under Regulation FD; and ● certain audit committee independence requirements in Rule 10A-3 of the Exchange Act. We are required to file an annual report on Form 20-F within four months of the end of each fiscal year. In addition, we publish our results on a quarterly basis as press releases, distributed pursuant to the rules and regulations of the NYSE. Press releases relating to financial results and material events are furnished to the SEC on Form 6-K. However, the information we are required to file with or furnish to the SEC is less extensive and less timely compared to that required to be filed with the SEC by U.S. domestic issuers. As a result, you may not be afforded the same protections or information that would be made available to you were you investing in a U.S. domestic issuer. ​ 68 Table of Contents As an exempted company incorporated in the Cayman Islands, we are permitted to adopt certain home country practices in relation to corporate governance matters that differ significantly from the NYSE corporate governance listing standards; these practices may afford less protection to shareholders than they would enjoy if we complied fully with the NYSE corporate governance listing standards. As an exempted company incorporated in the Cayman Islands that is listed on the NYSE, we are subject to the NYSE corporate governance listing standards. However, NYSE rules permit a foreign private issuer like us to follow the corporate governance practices of its home country. Certain corporate governance practices in the Cayman Islands, which is our home country, may differ significantly from the NYSE corporate governance listing standards. We follow home country practice and have a two-member audit committee, in lieu of the requirement of NYSE Listed Company Manual Section 303A.07 to have an audit committee with at least three members. Additionally, Section 303A.08 of the NYSE Listed Company Manual requires that shareholders must be given the opportunity to vote on all equity-compensation plans and material revisions thereto, with limited exemptions. We have followed our home country practice in this regard and did not seek shareholders’ approval when we approved the 2024 Share Incentive Plan. Furthermore, Section 303A.12(a) of the NYSE Listed Company Manual requires each listed company’s chief executive officer to certify to the NYSE each year that he or she is not aware of any violation by the company of NYSE corporate governance listing standards. We have followed our home country practice in this regard and have not in the past submitted the certification set forth in Section 303A.12(a) of the NYSE Listed Company Manual. In addition, Section 302.00 of the NYSE Listed Company Manual requires that we must hold an annual general meeting of shareholders during each fiscal year. We have followed our home country practice in lieu of the provisions of Section 302 and did not hold an annual general meeting of shareholders in 2025. We may also rely on other exemptions available to foreign private issuers in the future, and to the extent that we choose to do so in the future, our shareholders may be afforded less protection than they otherwise would under the NYSE corporate governance listing standards applicable to U.S. domestic issuers. ​