Xunlei (NASDAQ:XNET) Posts Earnings Results

Xunlei (NASDAQ:XNET) released its quarterly earnings results on Thursday. The software maker reported ($0.26) earnings per share for the quarter, FiscalAI reports. The company had revenue of $100.82 million for the quarter. Xunlei had a positive return on equity of 0.62% and a negative net margin of 15.25%.

Here are the key takeaways from Xunlei’s conference call:

• Revenue grew 12.9% year over year to $101.3 million, with subscription revenue up 8.5% and live streaming and other services up 16.6%. Management also cited strong, World Cup-related growth in Hupu advertising, while noting that the boost may be cyclical.
• Subscription growth moderated as Xunlei shifted user acquisition toward customers it believes have stronger retention and lifetime value, even if they initially spend less. Management said Q3 remained a transition period and expects benefits to emerge in later quarters.
• Profitability weakened: the company reported a $14.8 million operating loss and a $16.4 million non-GAAP net loss, versus non-GAAP net income a year earlier. Higher operating and marketing expenses pressured results, while a $219.2 million mark-to-market loss on its Arashi Vision investment contributed to a $235.8 million GAAP net loss.
• The board authorized a new $20 million share repurchase program for the next 12 months after the previous authorization was fully used; Xunlei had spent $13.8 million under that program as of September 30. Management said it will continue repurchases within the company’s charter restrictions.
• Xunlei gave no timeline or specific plan for reducing its 7.8% stake in Arashi Vision, citing the stock’s performance, market liquidity and regulatory considerations. Management said it is monitoring the investment’s share of assets and described the company as near the relevant threshold, adding another source of uncertainty.

Xunlei Stock Performance

Shares of XNET stock traded down $0.17 on Thursday, hitting $3.31. 229,123 shares of the stock traded hands, compared to its average volume of 264,561. The company’s fifty day moving average is $4.43 and its 200 day moving average is $5.38. Xunlei has a 1-year low of $3.10 and a 1-year high of $8.80. The company has a market capitalization of $211.30 million, a PE ratio of -2.67 and a beta of 1.13. The company has a debt-to-equity ratio of 0.03, a current ratio of 2.03 and a quick ratio of 2.03.

Analysts Set New Price Targets

Separately, Weiss Ratings upgraded shares of Xunlei from a “hold (c)” rating to a “hold (c+)” rating in a research note on Monday, September 28th. One research analyst has rated the stock with a Hold rating. Based on data from MarketBeat.com, the company presently has an average rating of “Hold”.

Institutional Trading of Xunlei

An institutional investor recently bought a new stake in Xunlei stock. Renaissance Technologies LLC purchased a new position in Xunlei Limited (NASDAQ:XNET) during the first quarter, according to its most recent 13F filing with the Securities and Exchange Commission. The firm purchased 89,300 shares of the software maker’s stock, valued at approximately $497,000. Renaissance Technologies LLC owned about 0.14% of Xunlei as of its most recent filing with the Securities and Exchange Commission. Institutional investors own 5.07% of the company’s stock.

Xunlei Company Profile

Xunlei Limited is a Chinese technology company founded in 2003 and headquartered in Shenzhen. It develops internet software and services, including Xunlei, a download and content-delivery platform designed to accelerate file transfers and online access. The company also offers cloud-related services, such as cloud storage and distributed cloud computing. Through its OneThing and related offerings, Xunlei uses shared computing resources to support services including content delivery and data processing.