Xunlei (NASDAQ:XNET) Issues Quarterly Earnings Results

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

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 opened at $3.54 on Friday. Xunlei has a 1 year low of $3.10 and a 1 year high of $8.80. The company has a debt-to-equity ratio of 0.03, a current ratio of 2.03 and a quick ratio of 2.03. The stock’s fifty day moving average price is $4.40 and its two-hundred day moving average price is $5.37. The firm has a market cap of $225.64 million, a PE ratio of 26.85 and a beta of 1.13.

Institutional Inflows and Outflows

A hedge fund recently bought a new position in Xunlei stock. Renaissance Technologies LLC acquired a new stake in shares of Xunlei Limited (NASDAQ:XNET) during the 1st quarter, according to its most recent disclosure with the Securities and Exchange Commission (SEC). The institutional investor acquired 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 SEC filing. Institutional investors own 5.07% of the company’s stock.

Analyst Ratings Changes

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 equities research analyst has rated the stock with a Hold rating. Based on data from MarketBeat.com, Xunlei presently has a consensus rating of “Hold”.

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.