IQiyi Raises $285 Million From Baidu and Investment Consortium
What’s new: IQiyi Inc. raised $285 million from its controlling shareholder Baidu and a consortium of investors through a private placement, the troubled video streaming company said Friday.
Baidu agreed to buy 164.7 million newly issued iQiyi class B ordinary shares, and the consortium, which includes Oasis Management Co. Ltd., will purchase 304.7 million newly issued Class A ordinary shares, iQiyi said.
Before the deal, Baidu owned more than 52% of iQiyi’s outstanding ordinary shares and 91.6% of the voting power as of Feb. 28, 2021.
The background: The Nasdaq-listed video streaming platform faces unprecedented challenges. While losing users, the company is trying to maintain growth by raising membership prices and cutting costs. Meanwhile, its stock price has continued to fall in the past year.
In the three months through December, iQiyi’s quarterly loss swelled to 1.8 billion yuan ($278.7 million) from 1.5 billion yuan in the comparable previous period. Revenue for the quarter dropped by 100 million yuan to 7.4 billion yuan.
At the end of 2021, iQiyi slashed 20% of its workforce. The company had more than 7,700 employees at the end of 2020, according to its earnings report. That means it released around 1,500 staff.
Quick Takes are condensed versions of China-related stories for fast news you can use. To read the full story in Chinese, click here.
Contact reporter Denise Jia (firstname.lastname@example.org) and editor Bob Simison (email@example.com)
Download our app to receive breaking news alerts and read the news on the go.
Get our weekly free Must-Read newsletter.
- MOST POPULAR