Chinese video streamer iQiyi unveiled a rare quarterly profit in the three months to March, amidst a mixed picture on revenue and subscriptions.
The company, which is listed on the NASDAQ stock exchange but is predominantly controlled by Chinese tech conglomerate Baidu, said in a filing that it had achieved net income attributable of RMB169 million ($26.7 million), compared to net loss attributable of RMB1.3 billion in the same period in 2021.
After more than a decade of annual losses, the company has recently discovered a need to become more efficient and focus on earnings rather than growth.
Revenues between January and March 2022 amounted to RMB7.3 billion ($1.1 billion) a decrease of 9% year-over-year. But the revenue portion that came from membership services was RMB4.5 billion ($705.4 million), increasing 4% year-over-year.
After a period of declining subscriber numbers, iQiyi’s captive market may have bottomed out. The average daily number of total subscribing members (including trial memberships) for the quarter was 101.4 million, compared to 105.4 million for the same period in 2021. But that was higher than the 97.0 million recorded in the fourth quarter in 2021.
The company has also squeezed content spending and made staff redundancies.
“We improved our operating efficiency, leading to margin expansion and profits. Our new strategy cemented our market leadership while yielding healthy financial performance. Going forward, we will adhere to the same strategy,” said Gong Yu, founder, director, and CEO.
The company’s shares remain far adrift of their $18 per ADR IPO price in early 2018. In the past 12 month, the stock has swung between a high of $16.12 and $1.86. At Wednesday’s trading close, they finished at $3.56 apiece.