Iqiyi has been exposed to substantial layoffs.
On December 1, there were media reports that iQiyi was laying off employees. The proportion of layoffs is about 20% to 40%. The compensation for layoffs has not been fully finalized, or press N+ 1 Issued. According to media reports, among the layoffs, more middle-level (director-level) employees were laid off, and there were also older employees, older employees with higher salaries, and most of them were laid off.
Regarding the issue of layoffs, as of press time, iQiyi has not responded.
Reduce more than a thousand employees?
On the workplace social platform “Maimai”, netizens also discussed the layoffs of iQiyi. Some netizens said: “This wave of layoffs The core departments and the fringe departments are involved. The moment, iQiyi, the studio, and the independent iQiyi Intelligence are also laying off employees. The longer they stay and the higher the salary cost, the more likely they are to be shot.” A netizen who was certified as an “iqiyi employee” said: “Some groups (cutting) 75%, it’s terrible.” Another netizen said: “Intelligent production has been cut.”
A former employee of iQiyi told a news reporter: “According to his understanding, many people in the company received more than 200,000 compensation for a long time. Wanqi started, and many people took the initiative to’give away people’ (seeking to be laid off).” Another probationary employee who was laid off from iQiyi’s core business department told reporters: “The company’s language is to flatten management, but everyone understands it. The cost of layoffs for employees with high salaries and still in the probationary period is relatively low. For the employees who have been dismissed, the company is also quick to cut the mess, requiring the resignation procedures to be completed immediately.”News reporters inquired about iQiyi’s 2018 and 2020 annual reports and found that at the end of 2016, 2017, 2018, 2019 and 2020, the number of iQiyi employees was 4,794, 6,014, 8577, 8889 and 7721, respectively . Among them, iQiyi has 1168 fewer employees in 2020 than in 2019.
If iQiyi’s number of employees at the end of 2020 is calculated from 7721, the number of layoffs between 20% and 40% will be between 1544 and 3088.
As of December 1, Eastern Time, iQiyi’s stock price plummeted by 9.46% to $5.650 per share, with a total market value of 44.59 billion U.S. dollars, which is a far cry from the issue price of 18 U.S. dollars when it was listed on the Nasdaq in 2018.
Loss of more than 26 billion yuan in three years
Judging from the financial report of iQiyi after its listing, it is also a loss year after year. Its financial report shows that in 2020 In 2015, iQiyi had a net loss of 7 billion yuan, a net loss of 10.3 billion yuan in 2019, a net loss of 9.1 billion yuan in 2018, and a total net loss of 26.4 billion yuan in three years.
Before the news of the layoffs, iQiyi had just experienced an unsatisfactory financial report for the quarter: loss of members and increased losses.
On November 17, iQiyi announced its unaudited financial report for the third quarter ending September 30, 2021. The financial report shows that in the third quarter of 2021, iQiyi’s total revenue reached 7.6 billion yuan, a year-on-year increase of 6%; the net loss attributable to iQiyi was 1.7 billion yuan, compared with a loss of 1.2 billion yuan in the same period last year, and the loss increased by 42% year-on-year. %.
In terms of subscription members, as of September 30, 2021, iQiyi’s subscription members reached 103.6 million, compared with 103 million in the same period last year, but the second in 2021 In the quarter, the total number of iQiyi members was 106.2 million. Compared with the second quarter, the third quarter lost 2.6 million subscribers. Member advertising is one of iQiyi’s main businesses. In the third quarter, membership advertising accounted for 56.6% of revenue. Regarding the outlook for the fourth quarter, iQiyi expects total revenue to be between 7.08 billion yuan and 7.53 billion yuan, a year-on-year decrease of 5% to a year-on-year increase of 1%.
After the release of the earnings report, iQiyi’s share price plummeted by 17.23%. Haitong International pointed out in a report on November 18 that the company’s net cash reached negative 11 billion yuan, and if long-term convertible bonds were not considered, it was 1.6 billion yuan. At the current rate of burning money, the company may need to refinance within two quarters.
Gong Yu, CEO of iQiyi, mentioned in the financial report that during the quarter, iQiyi experienced significant uncertainty in content arrangements, which led to The higher-end performance was weaker than expected. Uncertainty is expected to continue to a large extent, so iQiyi is actively adapting to the new market environment and is determined to continue to improve operational efficiency while implementing a diversified content strategy.
It is reported that in August this year, Gong Yu stated that Iqiyi will cancel the idol talent show in the next few years. In October, iQiyi announced that it would officially cancel the advance-on-demand series of dramas and cancel the content promotional videos visible to members. In November, because members can still see a wide variety of advertisements, the Zhejiang Provincial Consumer Protection Committee interviewed video platforms such as iQiyi, Youku, Tencent Video, and Sohu. The above platforms have also submitted rectification reports on schedule.