In This Article:
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Total Revenue: RMB7.2 billion, down 10% annually.
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Membership Services Revenue: RMB4.4 billion, down 13% annually.
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Online Advertising Revenue: RMB1.3 billion, down 20% year over year.
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Content Distribution Revenue: RMB814 million, grew 52% annually.
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Other Revenues: RMB729 million, decreased by 8% annually.
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Content Cost: RMB4.0 billion, down 5% annually.
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Total Operating Expenses: RMB1.4 billion, down 5% annually.
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Non-GAAP Operating Income: RMB369 million with a margin of 5%.
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Operating Cash Flow: RMB243 million, positive for ten consecutive quarters.
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Cash and Cash Equivalents: RMB4.7 billion at the end of Q3.
Release Date: November 21, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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iQIYI Inc (NASDAQ:IQ) regained the number one position in viewership market share for long-form videos, driven by successful drama releases.
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The company has introduced mini and short dramas, which have gained considerable popularity and offer new monetization opportunities.
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iQIYI Inc (NASDAQ:IQ) is leveraging AI technology to improve business efficiency, including content translation and dubbing for overseas markets.
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The company has launched a Family Account option to enhance user experience and combat unauthorized password sharing.
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iQIYI Inc (NASDAQ:IQ) recorded solid performance in its overseas business, with significant growth in membership revenue in markets like Hong Kong, UK, Brazil, and Australia.
Negative Points
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Total revenues for the third quarter were down 10% annually, with membership services revenue decreasing by 13%.
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Advertising revenue decreased by 20% year over year, primarily due to a decline in brand ad business.
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The company faced challenges in the supply of premium female-oriented and ancient costume dramas, impacting membership revenue.
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Macro headwinds and increased entertainment options have led to more cautious consumer spending.
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Despite advancements, the company experienced a decrease in brand ad revenue due to weak advertiser sentiment amid macroeconomic challenges.
Q & A Highlights
Q: Can management elaborate on the strategy for mini and short dramas? A: Yu Gong, CEO, explained that iQIYI has integrated mini and short dramas into its content ecosystem, complementing traditional long-form videos. Mini dramas are 1 to 5 minutes long, while short dramas are 5 to 20 minutes. The company is focusing on mini dramas, offering them for free to subscribers and introducing a subscription model to enhance membership retention and attract new users. The strategy includes licensing, buyouts, and profit-sharing to develop high-quality content unique to iQIYI.