With Post-IPO Profit Warning, Is Readboy Losing Its Gold Star?

Less than a month after its Hong Kong listing, the smart learning device maker admitted losing up to 45 million yuan in first half of the year Key Takeaways: Readboy has warned it expects to post a loss of 40 million yuan to 45 million yuan in the first half of the year The learning device maker’s offline distribution network, which accounts for up to 90% of sales, took a hit from Covid store closures during the period By Fai Pui Continual school closures with a steady stream of Covid…

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SenseTime Steps on Smart Car Accelerator with GAC Tie-Up

Controversial AI company’s new alliance with major automaker could help it diversify beyond the government contracts that are its main revenue source Key Takeaways: SenseTime is stepping up its drive into the smart automobile industry as part of its effort to diversify beyond government clients The company’s stock slumped up to 51% on June 30 after a lock-up period expired, and its shares have now lost nearly two-thirds of their value from their post-IPO high By Trevor Mo Move over, Huawei, Baidu (BIDU.US; BIDU.US) and all the other China big…

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Tuya Seeks Hong Kong IPO to Hedge U.S. Delisting Risk, But Investors Are Wary

With the possibility of being forced to delist from the U.S. market by the SEC, Tuya is primarily seeking a safe harbor and only aims to raise a conservative HK$140 million Key takeaways: Tuya’s failure to turn a profit and a lackluster performance of the overall share market in Hong Kong has dampened investor interest The first-quarter loss of the internet of things company widened by 35.6% year-on-year as a result of rising R&D and operational costs By Fai Pui As the diplomatic and economic showdown between Beijing and Washington…

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Despite iQiyi Denial, Is Baidu Set to Roll Credits on Its Video Affiliate?

Baidu is rumored to be seeking to sell its controlling stake in iQiyi, a video platform dubbed “China’s Netflix”. The report was denied by iQiyi, but Baidu’s silence is stoking market speculation Key Takeaways: A Reuters report says search engine giant Baidu is considering selling the recently profitable iQiyi platform with a target price of $7 billion iQiyi denied the report. But it could make sense for Baidu to divest from video streaming to sharpen its focus on cloud services, AI and self-driving products By Fai Pui Just as the video…

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YSB’s B2B Pharma Platform: Sexier Than the SOEs, But Stodgier Than B2Cs

The drug distributor for pharmacies and community-level medical institutions has filed for a Hong Kong listing, boasting strong revenue growth but also massive losses Key Takeaways: YSB has filed for a Hong Kong listing, operating a B2B drug-selling business model with lower margins than B2C platforms Company operates a drug-trading platform and its own proprietary business, with a P/S ratio lower than B2C platforms but higher than traditional drug distributors By Molly Wen While selling to consumers can generate big user numbers for e-commerce companies, it also generates big pressure…

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Readboy Tries Again for IPO but Faces Tough Test from Edtech Rivals

The maker of learning devices for children has filed for an IPO at the Hong Kong Stock Exchange for a third time, but an old-school operating model could weigh on revenues Key Takeaways: Readboy Education wants to raise money to buy companies up and down the supply chain and expand its sales network The company relies heavily on brick-and-mortar distributors, and faces daunting challenges from many new players adept at e-commerce marketing By Molly Wen Readboy Education Holding Co. Ltd. was among China’s pioneers of educational technology when digital devices first appeared in…

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FAST NEWS: U.S. Warns of ‘Significant Issues,’ ‘Time Running Out’ to Reach Securities Deal With China

The latest: Despite recent progress in negotiations for an information-sharing agreement between U.S. and Chinese securities regulators, “significant issues remain and time is quickly running out” to reach such an agreement, a U.S. Securities and Exchange Commission (SEC) official said. Looking Up: Recent talks with the China Securities Regulatory Commission (CSRC) have been “productive” and “constructive,” Y.J. Fischer, director of the SEC’s Office of International Affairs, said in remarks published online on Tuesday. Take Note: Fischer warned that even if an agreement is reached, more time will be needed to…

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Shrinking Tencent Music Looks for Sustainable Business Model

China’s equivalent of Spotify posted first-quarter revenue and profit declines, as it overhauls its business after being ordered to stop anti-competitive practices Key Takeaways: Tencent Music’s revenue and profit fell 15% and 34%, respectively, in the first quarter, after the company was ordered to stop its anti-competitive practices last year Company is shifting focus to providing more products and services for music lovers in bid to create a sustainable business model in the current environment By Doug Young Singing the blues, or hitting all the right notes? Those are two…

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Zhihu in Quest to Be First Internet Firm with U.S., Hong Kong Primary Listings

The Q&A platform has applied for a second primary listing in Hong Kong, though reception for the deal has been tepid Key takeaways: Zhihu will make a second primary listing in Hong Kong alongside its current U.S. listing, aiming to ease U.S. regulatory pressure and reach more Chinese investors Lukewarm interest in the new Hong Kong offering suggests investors are concerned about the company’s growing losses By Jony Ho Another Chinese company is jumping on the dual-listing bandwagon to Hong Kong, this time by online Q&A platform Zhihu Inc. (ZH.US;…

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FAST NEWS: SEC Doubles Number of Chinese Companies at Risk of Delisting

The latest: The U.S. Securities and Exchange Commission (SEC) on Tuesday added 12 company names to a growing list of New York-traded Chinese firms that could be delisted for failing to comply with U.S. law. The additions are mostly midcap companies, including solar materials company Daqo New Energy (DQ.US; 688303.SH), internet portal Sohu (SOHU.US) and asset manager Noah Holdings (NOAH.US). Looking Up: The addition of the companies to the SEC’s list isn’t related to their individual performance, but instead appears related to recent public filings of their annual reports. Nearly…

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