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Iqiyi Inc (IQ)
NASDAQ:IQ
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Iqiyi
(NASDAQ:IQ)69Neutral
Positive Factors
Content Strategy
The launch of several quality drama series drove a solid rebound of membership business and reinforced iQiyi’s top position in terms of total drama market share.
International Expansion
IQiyi is seeing better growth in its overseas business, particularly in regions like Thailand, Malaysia, and Hong Kong, and plans to optimize content strategy to drive subscriber revenue growth.
Negative Factors
Revenue Decline
Membership services declined 15% year-over-year, online ads down 13% year-over-year, content distribution set back 20% year-over-year and other revenues down 10% year-over-year.
Iqiyi (IQ) vs. S&P 500 (SPY)
Market Cap
$2.26B
Dividend YieldN/A
Average Volume (3M)34.31M
Price to Earnings (P/E)21.2
Beta (1Y)1.07
Revenue Growth-9.84%
EPS Growth-61.26%
CountryUS
Employees4,788
SectorCommunication Services
Sector Strength85
IndustryTraditional Media
Share Statistics
EPS (TTM)0.11
Shares Outstanding525,220,640
10 Day Avg. Volume30,325,960
30 Day Avg. Volume34,311,313
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)3.67
Price to Cash Flow (P/CF)N/A
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$2.68Price Target Upside14.04% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering8
Iqiyi Business Overview & Revenue Model
Company DescriptioniQIYI, Inc. is a leading online entertainment service in China. The company offers a comprehensive library of content, including licensed movies, television dramas, variety shows, and other video content. As a pioneer in China's internet video streaming industry, iQIYI integrates a wide range of content with innovative technology, offering users a high-quality viewing experience. The company's platform supports various devices, including mobile phones, tablets, and smart TVs, catering to a broad audience base.
How the Company Makes MoneyiQIYI generates revenue primarily through a combination of membership services and online advertising. Membership services, where users pay subscription fees for access to premium content and ad-free viewing, form a significant portion of its income. Additionally, the company monetizes its platform through advertising by offering advertisers access to its large user base. This includes display ads, sponsored content, and video commercials. iQIYI also explores other revenue streams, such as content distribution, licensing fees, and partnerships with other media companies to expand its reach and content offerings.
Iqiyi Financial Statement Overview
Summary
Iqiyi shows signs of financial improvement with better profitability and operational efficiency. However, declining revenue and high debt levels remain key areas to watch. The company needs to sustain its cash flow generation and manage debt effectively to ensure long-term stability.Income Statement
Iqiyi's revenue showed a decline from 2023 to 2024, with a revenue growth rate of -8.31%. Despite this, the company improved its profitability metrics, with a gross profit margin of 24.88% and a net profit margin of 2.61% in 2024, compared to previous losses. The company's EBIT and EBITDA margins were positive, indicating operational improvements. However, the revenue decline remains a concern.70
Positive
Balance Sheet
Iqiyi's balance sheet reflects a moderate financial position. The debt-to-equity ratio of 1.06 is stable but shows reliance on debt. Return on Equity improved significantly to 5.72% in 2024, reflecting better profitability. The equity ratio stands at 29.21%, indicating a decent proportion of assets funded by equity. While there are improvements, the high debt levels could pose risks in the future.65
Positive
Cash Flow
The cash flow statement indicates a decline in free cash flow from 2023 to 2024 by 37.46%. The operating cash flow to net income ratio was 2.76, suggesting strong cash generation relative to profits. However, the free cash flow to net income ratio was 2.66, highlighting potential challenges in maintaining cash flow levels amidst revenue declines.60
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 29.23B | 31.87B | 29.00B | 30.55B | 29.71B | Gross Profit |
| 7.27B | 8.77B | 6.68B | 3.04B | 1.82B | EBIT |
| 1.81B | 2.99B | -12.81B | -4.48B | -6.04B | EBITDA |
| 1.82B | 17.25B | 14.34B | 12.10B | 11.28B | Net Income Common Stockholders |
| 764.06M | 1.93B | -117.78M | -6.11B | -7.01B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 4.47B | 5.38B | 7.92B | 4.35B | 14.27B | Total Assets |
| 45.76B | 44.59B | 46.05B | 42.47B | 48.19B | Total Debt |
| 14.14B | 15.29B | 21.83B | 17.57B | 21.52B | Net Debt |
| 10.61B | 10.86B | 14.74B | 14.57B | 10.61B | Total Liabilities |
| 32.39B | 32.41B | 39.70B | 36.80B | 38.85B | Stockholders Equity |
| 13.37B | 12.09B | 6.25B | 5.19B | 9.26B |
| Cash Flow | Free Cash Flow | |||
| 2.03B | 3.25B | -6.22B | -6.35B | -5.80B | Operating Cash Flow |
| 2.11B | 3.35B | -5.95B | -5.95B | -5.41B | Investing Cash Flow |
| -2.44B | -1.74B | 1.26B | 1.26B | 159.30M | Financing Cash Flow |
| -1.37B | -4.29B | -2.96B | -2.96B | 9.37B |
Iqiyi Technical Analysis
Positive
2.35
Price Trends
2.15
Positive
2.23
Positive
2.76
Negative
Market Momentum
0.01
Negative
55.99
Neutral
80.50
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IQ, the sentiment is Positive. The current price of 2.35 is above the 20-day moving average (MA) of 2.28, above the 50-day MA of 2.15, and below the 200-day MA of 2.76, indicating a neutral trend. The MACD of 0.01 indicates Negative momentum. The RSI at 55.99 is Neutral, neither overbought nor oversold. The STOCH value of 80.50 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IQ.
Iqiyi Risk Analysis
Iqiyi disclosed 96 risk factors in its most recent earnings report. Iqiyi reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Iqiyi Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $2.11T | 36.08 | 24.29% | ― | 10.99% | 91.61% | |
77 Outperform | $142.13B | 9.07 | 19.24% | 3.30% | 1.78% | 11.62% | |
74 Outperform | $190.74B | 34.26 | 5.54% | 0.90% | 3.97% | 89.53% | |
73 Outperform | $11.19B | ― | -5.37% | ― | 18.03% | 82.15% | |
69 Neutral | $2.26B | 21.19 | 6.01% | ― | -9.84% | -61.26% | |
65 Neutral | $381.18B | 44.94 | 38.43% | ― | 15.28% | 65.72% | |
59 Neutral | $30.54B | 0.25 | -13.23% | 4.04% | 2.36% | -49.53% |
* Communication Services Sector Average
Performance Comparison
IQ
Iqiyi
2.35
-1.72
-42.26%
AMZN
Amazon
199.25
27.29
15.87%
CMCSA
Comcast
37.59
-4.61
-10.92%
DIS
Walt Disney
105.51
-5.79
-5.20%
NFLX
Netflix
891.11
290.18
48.29%
ROKU
Roku
76.67
12.26
19.03%
Iqiyi Earnings Call Summary
Earnings Call Date: Feb 18, 2025 | % Change Since: -7.48% | Next Earnings Date: May 20, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted a significant rebound in business performance with strong content expansion and advertising growth. However, the call also noted annual declines in total revenues and challenges in membership and advertising revenue, creating a mixed outlook.Highlights
Significant Rebound in Business Performance
Since late November, there has been a significant increase in subscribing members and user time spent, with a strong comeback of top-tier content leading to improved market share.
Expansion of Content Portfolio
The mini-drama portfolio has expanded to over 10,000 titles, capturing 95% of the leading mini-drama content providers in the market.
Improvement in Membership Revenue
Membership revenue in Q1 was RMB 4.1 billion with strategies to cater to mass audiences and enhance membership benefits.
Advertising Revenue Growth
Advertising revenue grew by 7% sequentially, driven by double-digit brand ad revenue growth from premium dramas.
Strong Overseas Market Performance
Membership revenue from Hong Kong, U.K., Thailand, and Australia grew by over 30% year-over-year, with a plan to expand in new regions such as the Middle East and Latin America.
Lowlights
Annual Decline in Total Revenues
Total revenues for Q4 were RMB 6.6 billion, down 14% annually.
Decrease in Membership Services Revenue
Membership services revenue decreased by 15% annually due to a lighter content slate.
Online Advertising Revenue Decline
Revenue decreased by 13% year-over-year to RMB 1.4 billion, primarily due to a decline in brand advertisement business.
Content Distribution Revenue Drop
Content distribution revenue was down 20% annually, largely due to lower revenue from theatrical movies and decreased barter transactions.
Company Guidance
During the call, iQIYI provided guidance indicating a significant rebound in business performance across various metrics starting late November 2024. The company reported an increase in net additions of subscribing members and user time spent, with a strengthened leading position in the total drama market share. Two of their popular dramas surpassed 10,000 on the IT popularity index, solidifying their position in the suspense genre. The company also aimed to boost membership revenue by enhancing content quality and expanding advertising revenue through the growth of the mini-drama business. Financially, iQIYI reported total revenues of RMB 6.6 billion for Q4 2024, with membership services revenue reaching RMB 4.1 billion and online advertising revenue at RMB 1.4 billion. The company highlighted the introduction of new membership tiers and benefits, such as the S Diamond membership plan, to improve user retention and attract new subscribers. Additionally, iQIYI is optimistic about its overseas growth, particularly in markets like Southeast Asia and North America, and plans to expand into new regions such as the Middle East and Latin America in 2025.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.