What’s new: IQiyi Inc. has raised $285 million from its majority shareholder Baidu and a consortium of investors through a private placement, the struggling video streaming company announced on Friday.
Baidu has agreed to purchase 164.7 million newly issued Class B ordinary shares of iQiyi, and the consortium, which includes Oasis Management Co. Ltd., will purchase 304.7 million newly issued Class A ordinary shares , said iQiyi.
Prior to the deal, Baidu owned more than 52% of iQiyi’s outstanding common shares and 91.6% of the voting rights as of February 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 subscription prices and cutting costs. Meanwhile, its share price has continued to decline over the past year.
In the three months to December, iQiyi’s quarterly loss swelled to 1.8 billion yuan ($278.7 million), from 1.5 billion yuan in the prior comparable period. Revenue for the quarter fell 100 million yuan to 7.4 billion yuan.
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 he freed up around 1,500 employees.
Quick Takes are condensed versions of China-related stories for quick news that you can use. To read the full story in Chinese, click here.
To download our app to receive news alerts and read news on the go.
To have our free weekly Must-Read newsletter.