Kuaishou Technology, a Chinese video and e-commerce platform that rivals its biggest local rival ByteDance, said on Tuesday that its operating loss quadrupled in the fourth quarter of 2021 to 5790 million yuan, or about $904 million from $1370 million a year earlier. marketing and costs. The COVID-19 outbreak in China added uncertainty to the outlook, he noted.
Revenue for the last 3 months of 2021 rose 35% to 24. 4 billion yuan from 18. 1 billion yuan thanks to gains in online advertising, e-commerce and streaming.
Kuaishou shares traded in Hong Kong have lost 70% of their price over the past year. For the 2021 total, Kuaishou lost 78 billion yuan with revenues of 81 billion yuan. Approximately 28 billion yuan of this loss came from operations. (See main monetary points here. )
Kuaishou’s $5 billion IPO last year, which attracted Capital Group, Temasek, Invesco, Fidelity International, Blackrock, Boyu Capital, Morgan Stanley and the Abu Dhabi Investment Authority as major investors, underscored how China, the world’s second-largest economy and the number of cell phone users, has made its mark on the global media and entertainment industry.
However, China’s immediate recovery from the worst of the COVID-19 pandemic has given way to more disruptions this year, especially this month in Shanghai, one of Asia’s main shopping hubs, and Kuaishou said the lockdown was uncertain. During the COVID-19 pandemic outbreak, adding the emergence of variants of the delta and Omicron virus, the government of the People’s Republic of China (PRC) followed social distancing projects in reaction to the pandemic, and many other people turned to online social and entertainment activities instead of physical gatherings. As a result, there has been a sharp increase in demand for the Internet and cellular services. »
“However,” Kuaishou continued, “the increase in demand was offset by certain factors, adding (i) the reduction in ad spend of some of our advertisers who experienced uncertainties in their business operations due to the spread of Covid-19 and its multiple variants, which in turn affected the revenue of our online marketing facilities; (ii) a reduction in revenue and a reduction in the intake of our users due to the economic disruption caused by the Covid-19 pandemic, which has had an effect on the revenues of our live streaming business and on the expansion of our gmv e-commerce (gross value of products); and (iii) supply chain disruptions and demanding logistics situations that had limited our merchants’ ability to obtain goods and facilities for our users, affecting our e-commerce GMV.
“Although there has been an improvement in the COVID-19 scenario in China,” Kuaishou said, “we do not know when the COVID-19 outbreak will continue to be contained, nor can we expect whether the effect will be long-lasting. In particular, the recent emergence of the Omicron virus variant, a variant of the Covid-19 virus that is particularly more contagious than its predecessors, may just be a general business sentiment. We have taken a number of measures in reaction to the outbreak to protect our workers in accordance with government measures, including but not limited to remote operating arrangements for our workers and travel restrictions or suspensions. These measures have temporarily reduced the capacity and power of our operations.
Kuaishou still has a market capitalization of around $41 billion; President Su Hua has a fortune of $4. 9 billion, and CEO Cheng Yixiao now has $3. 8 billion on Forbes’ list of real-time billionaires.
ByteDance operates the Douyin video platforms in China and TikTok internationally.
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