BEIJING, Nov. 17, 2021 /PRNewswire/ -- iQIYI, Inc.
(Nasdaq: IQ) ("iQIYI" or the "Company"), an innovative
market-leading online entertainment service in China, today announced its unaudited financial
results for the third quarter ended September 30, 2021.
Third Quarter 2021 Highlights
- Total revenues were RMB7.6
billion (US$1.2
billion1), representing a 6% increase from the
same period in 2020.
- Operating loss was RMB1.4 billion
(US$212.3 million) and operating loss
margin was 18%, compared to operating loss of RMB1.2 billion and operating loss margin of 17%
in the same period in 2020.
- Net loss attributable to iQIYI was RMB1.7 billion (US$268.4
million), compared to net loss attributable to iQIYI of
RMB1.2 billion in the same period in
2020. Diluted net loss attributable to iQIYI per ADS was
RMB2.17 (US$0.34), compared to diluted net loss
attributable to iQIYI per ADS of RMB1.61 in the same period of 2020.
- The number of total subscribing members was 103.6 million as of
September 30, 2021, or 103.0 million
excluding individuals with trial memberships.
"During the third quarter, we experienced significant
uncertainty in terms of content scheduling, which resulted in
softer than expected top-line performance," commented Mr.
Yu Gong, Founder, Director, and
Chief Executive Officer of iQIYI. "We expect the uncertainty to
largely remain, so we are proactively adapting ourselves to the new
market environment. We are determined to continue improving the
efficiency of our operations as we execute our diversified content
strategy. Meanwhile, we are seeing a promising growth trajectory
for our new initiatives, such as iQIYI Lite and our overseas
business. We will continue to take the lead in rolling out new
intelligent production capabilities and driving the
industrialization of the long-form video production process, which
will help to further optimize our operating efficiency. The
experiences we have accumulated from the past decade and the recent
temporary challenges will enable us to be more resilient and
adaptive to market changes in the long run."
"Our membership services revenue increased by 8% year-over-year
as we experienced subscriber volatility during the third quarter,"
commented Mr. Xiaodong Wang, Chief
Financial Officer of iQIYI. "This was driven by our refined
membership strategy and innovative operational initiatives that
focused on elevating the user experience. Furthermore, we will
continue to improve the efficiency of our operations, and remain
cautious with our investments in content. In the long term, we will
continue to grow our portfolio with diversified content and develop
innovative new products and services with better ROI."
Footnotes:
[1] Unless
otherwise noted, all translations from RMB to U.S. dollars are made
at a rate of RMB6.4434 to US$1.00, the exchange rate in effect as
of September 30, 2021 as set forth in the H.10 statistical release
of the Board of Governors of the Federal Reserve System.
Translations are provided solely for the convenience of the
reader.
|
Third Quarter 2021 Financial Results
Total revenues reached RMB7.6
billion (US$1.2 billion),
representing a 6% increase from the same period in 2020.
Membership services revenue was RMB4.3
billion (US$665.5 million),
representing an 8% increase from the same period in 2020. This was
mainly attributable to our refined membership strategy that focused
on content diversification and user experience, and improved
monetization capabilities.
Online advertising services revenue was RMB1.7 billion (US$257.7
million), representing a 10% decrease from the same period
in 2020, primarily due to less premium content launched during the
quarter and challenging macroeconomic environment in China.
Content distribution revenue was RMB627.1
million (US$97.3 million),
representing a 60% increase from the same period in 2020. The
increase was primarily driven by more content titles distributed to
other platforms during the quarter.
Other revenues were RMB1.0 billion
(US$157.3 million), representing a 3%
increase from the same period in 2020.
Cost of revenues was RMB7.0
billion (US$1.1 billion),
representing a 10% increase from the same period in 2020. The
increase in cost of revenues was primarily due to higher content
costs during the quarter. Content costs as a component of cost of
revenues were RMB5.3 billion
(US$824.5 million), representing a
13% increase from the same period in 2020, primarily due to more
investment in original content.
Selling, general and administrative expenses were RMB1.2 billion (US$193.4
million), representing a 9% decrease from the same period in
2020.
Research and development expenses were RMB683.0 million (US$106.0
million), representing a 2% increase from the same period in
2020.
Operating loss was RMB1.4 billion
(US$212.3 million), compared to
operating loss of RMB1.2 billion in
the same period in 2020. Operating loss margin was 18%, compared to
operating loss margin of 17% in the same period in 2020.
Total other expense was RMB330.5
million (US$51.3 million),
compared to total other income of RMB67.0
million during the same period of 2020. The year-over-year
variance was mainly due to the fluctuation of exchange rate between
Renminbi and the U.S. dollar.
Loss before income taxes was RMB1.7
billion (US$263.6 million),
compared to loss before income taxes of RMB1.1 billion in the same period in 2020.
Income tax expense was RMB9.0
million (US$1.4 million),
compared to income tax expense of RMB18.8
million in the same period in 2020.
Net loss attributable to iQIYI was RMB1.7
billion (US$268.4 million),
compared to net loss attributable to iQIYI of RMB1.2 billion in the same period in 2020.
Diluted net loss attributable to iQIYI per ADS was RMB2.17 (US$0.34)
for the third quarter of 2021, compared to diluted net loss
attributable to iQIYI per ADS of RMB1.61 in the same period of 2020.
As of September 30, 2021, the
Company had cash, cash equivalents, restricted cash and short-term
investments of RMB11.0 billion
(US$1.7 billion).
Financial Guidance
For the fourth quarter of 2021, iQIYI expects total net revenues
to be between RMB7.08 billion
(US$1.10 billion) and RMB7.53 billion (US$1.17
billion), representing a 5% decrease to 1% increase year
over year. This forecast reflects iQIYI's current and preliminary
view, which may be subject to change.
Conference Call Information
iQIYI's management will hold an earnings conference call at
6:30 AM on November 17, 2021, U.S. Eastern Time
(7:30 PM on November 17, 2021, Beijing Time).
Please register in advance of the conference using the link
provided below. Upon registering, you will be provided with
participant dial-in numbers, Direct Event passcode and unique
registrant ID by email.
Participant Online Registration:
http://apac.directeventreg.com/registration/event/6981067
It will automatically direct you to the registration page of
"iQIYI Third Quarter 2021 Earnings Conference Call," where you may
fill in your details for RSVP. If it requires you to enter a
participant conference ID, please enter "6981067".
In the 10 minutes prior to the call start time, you may use the
conference access information (including dial-in number(s), Direct
Event passcode and unique registrant ID) provided in the
confirmation email that you have received following your
pre-registration.
A telephone replay of the call will be available after the
conclusion of the conference call through November 25, 2021.
Dial-in numbers for the replay are as follows:
International
Dial-in
|
+61 2 8199
0299
|
Passcode:
|
6981067
|
A live and archived webcast of the conference call will be
available at http://ir.iqiyi.com/.
About iQIYI, Inc.
iQIYI, Inc. is an innovative market-leading online entertainment
service in China. Its corporate
DNA combines creative talent with technology, fostering an
environment for continuous innovation and the production of
blockbuster content. iQIYI's platform features highly popular
original content, as well as a comprehensive library of other
professionally-produced content, professional user generated
content and user-generated content. The Company distinguishes
itself in the online entertainment industry by its leading
technology platform powered by advanced AI, big data analytics and
other core proprietary technologies. iQIYI attracts a massive user
base with tremendous user engagement, and has developed a
diversified monetization model including membership services,
online advertising services, content distribution, online games,
live broadcasting, IP licensing, talent agency, online literature,
etc.
Safe Harbor Statement
This announcement contains forward-looking statements. These
statements are made under the "safe harbor" provisions of the U.S.
Private Securities Litigation Reform Act of 1995. These
forward-looking statements can be identified by terminology such as
"will," "expects," "anticipates," "future," "intends," "plans,"
"believes," "estimates," "confident" and similar statements. Among
other things, the Financial Guidance and quotations from management
in this announcement, as well as iQIYI's strategic and operational
plans, contain forward-looking statements. iQIYI may also make
written or oral forward-looking statements in its periodic reports
to the U.S. Securities and Exchange Commission, in its annual
report to shareholders, in press releases and other written
materials and in oral statements made by its officers, directors or
employees to third parties. Statements that are not historical
facts, including but not limited to statements about iQIYI's
beliefs and expectations, are forward-looking statements.
Forward-looking statements involve inherent risks and
uncertainties. A number of factors could cause actual results to
differ materially from those contained in any forward-looking
statement, including but not limited to the following: iQIYI's
strategies; iQIYI's future business development, financial
condition and results of operations; iQIYI's ability to retain and
increase the number of users, members and advertising customers,
and expand its service offerings; competition in the online
entertainment industry; changes in iQIYI's revenues, costs or
expenditures; Chinese governmental policies and regulations
relating to the online entertainment industry, general economic and
business conditions globally and in China and assumptions underlying or related to
any of the foregoing. Further information regarding these and other
risks is included in the Company's filings with the Securities and
Exchange Commission. All information provided in this press release
and in the attachments is as of the date of the press release, and
iQIYI undertakes no duty to update such information, except as
required under applicable law.
Non-GAAP Financial Measures
To supplement iQIYI's consolidated financial results presented
in accordance with GAAP, iQIYI uses free cash flow as non-GAAP
financial measure. The presentation of the non-GAAP financial
measure is not intended to be considered in isolation or as a
substitute for the financial information prepared and presented in
accordance with GAAP.
iQIYI believes that the non-GAAP financial measure provides
meaningful supplemental information regarding its liquidity by
excluding certain items that may not be indicative of its recurring
liquidity position, such as operating cash flows adjusted by
capital expenditures. The Company believes that both management and
investors benefit from referring to the non-GAAP financial measure
in assessing its liquidation and when planning and forecasting
future periods. The non-GAAP financial measure also facilitates
management's internal comparisons to iQIYI's historical liquidity.
The Company believes the non-GAAP financial measure is useful to
investors in allowing for greater transparency with respect to
supplemental information used by management in its financial and
operational decision making. A limitation of using the non-GAAP
financial measure is that the non-GAAP measure exclude certain
items that have been and will continue to be for the foreseeable
future a significant component in the Company's results of
operations. The non-GAAP financial measure presented here may not
be comparable to similarly titled measures presented by other
companies. Other companies may calculate similarly titled measures
differently, limiting their usefulness as comparative measures to
the Company's data.
Free cash flow represents net cash provided by operating
activities less capital expenditures.
For more information, please contact:
Investor Relations
iQIYI, Inc.
+ 86 10 8264 6585
ir@qiyi.com
iQIYI,
INC.
Condensed
Consolidated Statements of Loss
(In RMB
thousands, except for number of shares and per share
data)
|
|
|
|
Three Months
Ended
|
|
September
30,
|
|
June
30,
|
|
September
30,
|
|
2020
|
|
2021
|
|
2021
|
|
RMB
|
|
RMB
|
|
RMB
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
Revenues:
|
|
|
|
|
|
Membership
services
|
3,975,514
|
|
3,992,956
|
|
4,288,215
|
Online advertising
services
|
1,840,231
|
|
1,825,333
|
|
1,660,332
|
Content
distribution
|
392,338
|
|
687,891
|
|
627,134
|
Others
|
979,609
|
|
1,102,094
|
|
1,013,423
|
Total
revenues
|
7,187,692
|
|
7,608,274
|
|
7,589,104
|
|
|
|
|
|
|
Operating
costs and expenses:
|
|
|
|
|
|
Cost of
revenues
|
(6,363,438)
|
|
(6,868,868)
|
|
(7,027,681)
|
Selling, general and
administrative
|
(1,363,935)
|
|
(1,184,736)
|
|
(1,246,334)
|
Research and
development
|
(669,933)
|
|
(676,481)
|
|
(683,047)
|
Total
operating costs and expenses
|
(8,397,306)
|
|
(8,730,085)
|
|
(8,957,062)
|
Operating
loss
|
(1,209,614)
|
|
(1,121,811)
|
|
(1,367,958)
|
|
|
|
|
|
|
Other
expense
|
|
|
|
|
|
Interest
income
|
34,049
|
|
29,231
|
|
35,979
|
Interest
expenses
|
(269,311)
|
|
(343,124)
|
|
(351,293)
|
Foreign exchange gain,
net
|
265,572
|
|
35,404
|
|
4,462
|
Loss from equity
method investments
|
(24,749)
|
|
(64,230)
|
|
(17,345)
|
Others, net
|
61,461
|
|
116,280
|
|
(2,292)
|
Total other
income/(expense), net
|
67,022
|
|
(226,439)
|
|
(330,489)
|
|
|
|
|
|
|
Loss before
income taxes
|
(1,142,592)
|
|
(1,348,250)
|
|
(1,698,447)
|
Income tax
expense
|
(18,846)
|
|
(30,418)
|
|
(8,978)
|
|
|
|
|
|
|
Net
loss
|
(1,161,438)
|
|
(1,378,668)
|
|
(1,707,425)
|
Less: Net income
attributable to noncontrolling interests
|
12,850
|
|
18,559
|
|
22,135
|
Net loss
attributable to iQIYI, Inc.
|
(1,174,288)
|
|
(1,397,227)
|
|
(1,729,560)
|
Accretion of
redeemable noncontrolling interests
|
(1,796)
|
|
(4,343)
|
|
(4,769)
|
Net loss
attributable to ordinary shareholders
|
(1,176,084)
|
|
(1,401,570)
|
|
(1,734,329)
|
|
|
|
|
|
|
Net loss per
share for Class A and Class B ordinary shares:
|
|
|
|
|
|
Basic
|
(0.23)
|
|
(0.25)
|
|
(0.31)
|
Diluted
|
(0.23)
|
|
(0.25)
|
|
(0.31)
|
|
|
|
|
|
|
Net loss per
ADS (1 ADS equals 7 Class A ordinary shares):
|
|
|
|
|
|
Basic
|
(1.61)
|
|
(1.75)
|
|
(2.17)
|
Diluted
|
(1.61)
|
|
(1.75)
|
|
(2.17)
|
|
|
|
|
|
|
Weighted average
number of Class A and Class B ordinary shares used in
net loss per share computation:
|
|
|
|
|
|
Basic
|
5,182,686,302
|
|
5,569,531,698
|
|
5,590,418,635
|
Diluted
|
5,182,686,302
|
|
5,569,531,698
|
|
5,590,418,635
|
iQIYI,
INC.
Condensed
Consolidated Balance Sheets
(In RMB thousands,
except for number of shares and per share data)
|
|
|
|
|
December
31,
|
|
September
30,
|
|
|
2020
|
|
2021
|
|
|
RMB
|
|
RMB
|
|
|
|
|
(Unaudited)
|
ASSETS
|
|
|
|
|
Current assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
10,915,282
|
|
7,296,165
|
Restricted
cash
|
|
25,230
|
|
89,667
|
Short-term
investments
|
|
3,358,174
|
|
3,661,719
|
Accounts receivable,
net
|
|
3,344,433
|
|
2,882,733
|
Prepayments and other
assets
|
|
3,515,855
|
|
3,715,664
|
Amounts due from
related parties
|
|
96,111
|
|
274,498
|
Licensed copyrights,
net
|
|
1,035,339
|
|
1,096,941
|
Total current assets
|
|
22,290,424
|
|
19,017,387
|
|
|
|
|
|
Non-current assets:
|
|
|
|
|
Fixed assets,
net
|
|
1,393,467
|
|
1,315,895
|
Long-term
investments
|
|
3,202,828
|
|
3,435,521
|
Deferred tax assets,
net
|
|
51,347
|
|
84,917
|
Licensed copyrights,
net
|
|
6,435,055
|
|
7,292,712
|
Intangible assets,
net
|
|
627,198
|
|
563,199
|
Produced content,
net
|
|
6,556,084
|
|
9,597,884
|
Prepayments and other
assets
|
|
2,699,423
|
|
3,079,995
|
Operating lease
assets
|
|
1,001,857
|
|
939,934
|
Goodwill
|
|
3,888,346
|
|
3,888,346
|
Amounts due from
related parties
|
|
39,400
|
|
81,000
|
Total non-current assets
|
|
25,895,005
|
|
30,279,403
|
|
|
|
|
|
Total
assets
|
|
48,185,429
|
|
49,296,790
|
|
|
|
|
|
LIABILITIES,
REDEEMABLE NONCONTROLLING INTERESTS AND SHAREHOLDERS'
EQUITY
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts and notes
payable
|
|
7,561,532
|
|
9,128,010
|
Amounts due to related
parties
|
|
1,778,783
|
|
2,418,734
|
Customer advances and
deferred revenue
|
|
3,444,917
|
|
3,209,078
|
Convertible senior
notes, current portion
|
|
4,752,061
|
|
4,807,593
|
Short-term
loans
|
|
2,965,957
|
|
3,990,459
|
Long-term loans,
current portion
|
|
909,034
|
|
656,861
|
Operating lease
liabilities, current portion
|
|
201,307
|
|
179,077
|
Accrued expenses and
other liabilities
|
|
3,240,987
|
|
3,557,070
|
Total current liabilities
|
|
24,854,578
|
|
27,946,882
|
Non-current
liabilities:
|
|
|
|
|
Convertible senior
notes
|
|
11,926,715
|
|
12,671,436
|
Deferred tax
liabilities
|
|
4,588
|
|
4,231
|
Amounts due to related
parties
|
|
977,407
|
|
793,990
|
Operating lease
liabilities
|
|
767,676
|
|
633,265
|
Other non-current
liabilities
|
|
210,167
|
|
204,268
|
Total non-current liabilities
|
|
13,886,553
|
|
14,307,190
|
|
|
|
|
|
Total
liabilities
|
|
38,741,131
|
|
42,254,072
|
|
|
|
|
|
Redeemable
noncontrolling interests
|
|
108,629
|
|
374,355
|
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
|
|
|
|
|
Class A ordinary
shares
|
|
165
|
|
172
|
Class B ordinary
shares
|
|
183
|
|
183
|
Additional paid-in
capital
|
|
47,687,483
|
|
49,365,225
|
Accumulated
deficit
|
|
(40,973,853)
|
|
(45,379,956)
|
Accumulated other
comprehensive income
|
|
2,542,680
|
|
2,601,930
|
Non-controlling
interests
|
|
79,011
|
|
80,809
|
Total
shareholders' equity
|
|
9,335,669
|
|
6,668,363
|
|
|
|
|
|
Total liabilities,
redeemable noncontrolling interests and shareholders'
equity
|
|
48,185,429
|
|
49,296,790
|
iQIYI,
INC.
Condensed
Consolidated Statements of
Cash Flows
(In RMB
thousands, except for number of shares and per share
data)
|
|
|
|
Three Months
Ended
|
|
September
30,
|
|
June
30,
|
|
September
30,
|
|
2020
|
|
2021
|
|
2021
|
|
RMB
|
|
RMB
|
|
RMB
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
|
|
Net cash used for
operating activities
|
(1,929,077)
|
|
(1,425,910)
|
|
(2,080,544)
|
Net cash provided by
investing activities (1,2)
|
342,847
|
|
58,140
|
|
1,885,081
|
Net cash provided by
financing activities
|
238,109
|
|
801,074
|
|
867,420
|
Effect of exchange
rate changes on cash, cash equivalents
and restricted cash
|
(113,074)
|
|
(92,498)
|
|
(22,206)
|
Net
(decrease)/increase in cash, cash equivalents and
restricted cash
|
(1,461,195)
|
|
(659,194)
|
|
649,751
|
|
|
|
|
|
|
Net cash used for
operating activities
|
(1,929,077)
|
|
(1,425,910)
|
|
(2,080,544)
|
Less: Capital
expenditures (2)
|
(89,938)
|
|
(60,728)
|
|
(116,320)
|
Free cash
flow
|
(2,019,015)
|
|
(1,486,638)
|
|
(2,196,864)
|
|
(1) Net cash provided by
investing activities primarily consists of net cash flows from
investing in debt securities, purchase of long-term investments and
capital expenditures.
|
(2) Capital expenditures are
incurred primarily in connection with leasehold improvements,
computers and servers.
|
View original
content:https://www.prnewswire.com/news-releases/iqiyi-announces-third-quarter-2021-financial-results-301426335.html
SOURCE iQIYI, Inc.