U.S. short seller Wolfpack Research’s allegations of financial fraud against Qutoutiao at the end of 2019 have not stopped the Chinese news aggregator from achieving top-line growth in the first quarter of 2020.
On Thursday, Tencent-backed Qutoutiao released its latest earnings report showing net revenue of 1.41 billion yuan ($199.4 million) in the first quarter, a year-on-year increase of 26.2%. Advertising and marketing revenue reached 1.36 billion yuan, up from 1.09 billion yuan in the same period last year.
As the coronavirus pandemic kept people indoors, there has been dramatic growth in traffic to various apps in the January-March period. This trend is also reflected in Qutoutiao’s growing base of monthly active users, which increased to 138.3 million from 111.4 million in the first quarter of 2019.
Despite the top-line growth, Qutoutiao still posted a net loss of 531.8 million yuan, albeit less than the 688.2 million yuan loss the company made in the same quarter of last year, the financial report showed.
For the second quarter, the Shanghai-based company expects its net revenue to reach between 1.41 billion yuan and 1.43 billion yuan, representing a year-on-year increase of 2% to 3%.
In December last year, Qutoutiao was targeted by Wolfpack Research, which claimed that the Chinese company had fabricated the vast majority of its 2018 revenue.
Contact reporter Ding Yi (firstname.lastname@example.org)