Stock plunge in Hong Kong has erased 70% of company’s value in past year
Kuaishou Technology, a China video and e-commerce platform that competes with larger homegrown rival ByteDance, said on Tuesday its operating loss quadrupled in the fourth quarter of 2021 to 5.79 billion yuan, or about $904 million from 1.37 billion a year earlier amid an increase in marketing and research expenses. Covid-19 outbreak in China was adding uncertainty to the outlook, it noted. Revenue in the last three months of 2021 increased by 35% to 24.4 billion yuan from 18.1 billion yuan on gains in online ads, e-commerce and livestreaming. Kuaishou’s Hong Kong-traded shares have lost 70% of their value in the past year. For all of 2021, Kuaishou lost 78 billion yuan on revenue of 81 billion yuan. About 28 billion yuan of that loss was from operations. (See financial details 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 cornerstone investors – underscored how China, the world’s No.2 economy and No.1 number user of mobile phone users, has been making a mark in the global media and entertainment industry. China’s early recovery from the worst of Covid-19 pandemic has given way to more disruptions this year, however, particularly this month in Shanghai, one of Asia’s main business hubs, and Kuaishou said containment was uncertain.
