Shares of Chinese video streaming platform iQIYI Inc. (NASDAQ: IQ) surged 5.26% in pre-market trading on Wednesday after the company reported better-than-expected second quarter 2025 financial results. Despite facing macroeconomic headwinds, iQIYI managed to beat earnings estimates and showcase its content strength.
For Q2 2025, iQIYI reported a loss of 0.14 yuan per share, narrower than analysts' expectations of a 0.23 yuan per share loss. Although revenue declined 11% year-over-year to 6.63 billion yuan ($925.3 million), it slightly beat the consensus estimate. The company's non-GAAP operating income was 58.7 million yuan, marking its 14th consecutive quarter of non-GAAP operating profitability.
Investors were particularly encouraged by iQIYI's content performance and strategic initiatives. CEO Gong Yu highlighted the company's success in delivering hit content, with several drama series achieving high popularity scores. Additionally, iQIYI is focusing on innovation by investing in key growth areas such as AI applications, micro-dramas, user experience services, and international expansion. The company's transition to self-operated IP consumer products and its growing micro-drama content pipeline of 15,000 titles also signal potential for future revenue diversification and growth.
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