Chinese video streaming platform iQIYI swings to Q2 loss as advertisers adjust strategies
Overview
iQIYI Q2 revenue falls 11% yr/yr to RMB6.63 bln ($925.3 mln)
Company reports operating loss of RMB46.2 mln, reversing last year's profit
Net loss attributable to iQIYI is RMB133.7 mln, compared to net income last year
Result Drivers
LIGHTER CONTENT SLATE - Membership services revenue fell 9% yr/yr due to a lighter content slate, according to CEO Yu Gong
ADVERTISING REVENUE DROP - Online advertising services revenue decreased 13% yr/yr as advertisers adjusted strategies amid macroeconomic pressures
CONTENT DISTRIBUTION DECLINE - Content distribution revenue fell 37% yr/yr, primarily due to a decrease in barter and cash transactions
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q2 Revenue |
| RMB 6.63 bln |
|
Q2 Adjusted Net Income |
| RMB 14.70 mln |
|
Q2 Net Income |
| -RMB 133.70 mln |
|
Q2 Adjusted Operating Income |
| RMB 58.70 mln |
|
Q2 Adjusted Operating Margin |
| 1.0% |
|
Q2 Operating Income |
| -RMB 46.20 mln |
|
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 8 "strong buy" or "buy", 12 "hold" and no "sell" or "strong sell"
The average consensus recommendation for the online services peer group is "buy"
Wall Street's median 12-month price target for iQIYI Inc is $2.00, about 14% below its August 19 closing price of $2.28
The stock recently traded at 21 times the next 12-month earnings vs. a P/E of 10 three months ago
Press Release: ID:nGNX4FQHsY
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