iQiyi officially landed on the Nasdaq opening up 1.1%

Tencent Securities News On the evening of March 29th, Beijing time, iQiyi officially listed on the NASDAQ stock market tonight, the stock code is “IQ”, which opened up 1.1% to US$18.2/ADS. The iQI IPO issuance price is set at 18 US dollars / ADS, according to the IPO issue of 125 million ADS, the financing amount reached 2.25 billion US dollars.

On March 26th, Beijing time, iQiyi stated in the amendment document No. 1 submitted to the US Securities and Exchange Commission that the company will issue 125 million American Depositary Receipts (ADS) in an initial public offering (IPO). The issue price range is $17 to $19, and the raised funds range from $2.25 billion to $2.375 billion. iQiyi's American depositary receipts per share is equivalent to 7 shares of Class A common stock.

Together with the 18.75 million American depositary receipts underwritten by the underwriters, iQiyi will reach a total of $2,731.25 million through the initial public offering.

After completing the initial public offering, IQI tradable shares will include Class A common shares and Class B common shares. Baiqi, the controlling shareholder of iQiyi, will hold all Class B common stock. iQI's Class A and Class B common stocks differ only in conversion rights and voting rights. 1 Class A common stock contains 1 share of voting rights and cannot be converted into B ordinary shares; 1 share of Class B common shares contains 10 voting rights and can be converted into Class A ordinary shares.

iQiyi has never achieved profitability

iQiyi's revenue in 2017 reached US$2.67 billion, up 55% year-on-year; however, its net loss reached US$574 million, an increase of 22% from the previous quarter's net loss. The company's prospectus shows that this situation is unlikely to change rapidly. iQiYi's revenue in 2017 reached $2.67 billion, equivalent to company revenue. Content expenditure increased by 67% year-on-year to US$1.94 billion; bandwidth spending increased by 17% year-on-year to US$336 million.

iQiyi currently expects that the company's revenue costs will continue to grow, and the growth rate will exceed the revenue growth rate at least in the short term.

iQiyi has 98.10 million subscribers and 98% are paid users

According to the statistics of China's third-party market research company iResearch, as of February 28, iQiyi has 60.1 million subscribers, of which more than 98% are paying users. In contrast, Netflix has a total of approximately 53 million subscribers in the US in the fourth quarter of last year, with approximately 58 million overseas subscribers.

In the fourth quarter ended December 31, 2017, iQiyi had an average monthly mobile visitor number of 421.3 million and an average mobile daily visitor of 126 million. In December alone, users watched 9.2 billion hours of video content on the iQiyi platform, and each user watched 1.7 hours of video content on the iQiyi app every day.

Equity structure

All directors and executives of iQiyi currently hold 2,946,341,194 tradable shares of the company, accounting for 70.6% of the total share capital. After the initial public offering, they will hold iQiyi 106,810,489 Class A shares and 2,839,530,705 Class B shares, accounting for 93.4% of the company's total voting rights.

Prior to iQiyi's initial public offering, Baidu held 2,839,530,705 shares of the company, accounting for 69.6% of the total share capital; after the initial public offering, Baidu will hold 2,839,530,705 B shares of iQiyi, accounting for 93.1% of the company's voting rights. .

Prior to iQiyi's initial public offering, Xiaomi Investment, a subsidiary of Xiaomi Technology, held 341,874,885 shares of the company, accounting for 8.4% of the total share capital. After the initial public offering, Xiaomi Investment held 341,874,885 shares of Class A, accounting for A. The total number of common stocks was 16.2%, accounting for 1.1% of the company's voting rights.

HH RSV-V Holdings Limited, a subsidiary of Gaochun Capital, held 232,060,527 common shares of iQIYI before the initial public offering, accounting for 5.7% of the total share capital. After the initial public offering, the company will hold 232,060,527 Class A shares of iQIY, accounting for 11.0% of the total A-shares.

Investment banks Goldman Sachs, Credit Suisse and Bank of America Merrill Lynch will act as joint lead underwriters for iQiyi's initial public offering, and Huaxing Capital, Citigroup and UBS Securities will act as joint deputy underwriters.