After three years of long-distance running, Ximalaya, the leading player in the online audio track, has still failed to land in the capital market as expected. After withdrawing its U.S. IPO in September 2021, Himalaya's move to the Hong Kong stock market has also experienced twists and turns, and both submissions have come to a standstill.
Recently, Himalaya made a comeback and once again submitted its latest prospectus on the Hong Kong Stock Exchange.
If the huge loss is the main reason for the closure of Himalaya's listing, then the success rate of Himalaya knocking on the door of the Hong Kong Stock Exchange may be greatly improved. Thanks to the new progress made in commercialization and cost control, Himalaya achieved an adjusted profit of RMB224 million in 2023.
Revenues slowed, but losses were reversed
Himalaya is the largest online audio platform in mainland China, and it has a partnership with Lychee (SOGP. US) and Dragonfly FM together form the "Three Musketeers" of the mainland online audio market.
Himalaya has established a healthy, balanced and dynamic ecological content system covering from head IP to long-tail content, and is the most comprehensive audio content ecosystem in China, including the largest audio content library and the largest number of audio content creators.
Unlike LIZHI's commercialization, which relies heavily on audio entertainment, Ximalaya's monetization model is more diversified, with revenue sources including subscriptions, advertising, live streaming, and other innovations and services (such as sales of IoT devices, IP-derived cultural and creative products, etc.).
Supported by the subscription service sector, the main force of revenue, Himalaya has achieved revenue growth in the past few years, but the growth rate has gradually slowed down, with revenue of 5.857 billion yuan, 6.061 billion yuan and 6.132 billion yuan from 2021 to 2023, with revenue growth rates of 43.7%, 3.5% and 1.7% respectively.
In addition to the poor growth rate of subscription revenue, the growth of Himalaya's advertising business and live broadcast business was sluggish.
Advertising revenue has fallen twice in the past two years, largely due to the reduction in advertiser spending in the economic environment, which is a common dilemma faced by the industry. The live streaming market has been strictly regulated in recent years, and Himalaya has had to strengthen compliance supervision of user behavior, resulting in a decrease in the number of paying users of the live streaming business.
In terms of hematopoietic capacity, Himalaya has reduced food and clothing through layoffs and salary cuts on the one hand, and on the other hand, it has enhanced its liquidity and finally achieved a turnaround in 2023.
In 2021, Himalaya's adjusted net loss was $718 million, narrowing to $296 million in 2022, and achieving an adjusted net profit of $224 million for the full year of 2023.
As for the increase in profitability in 2023, Himalaya explained, "It is mainly due to the expansion of the user base, the enhancement of liquidity, and the improvement of gross profit margin and operating efficiency brought about by the optimization of cost structure." ”
Key data such as payment rates declined
In the era of short videos, the attention and time of many Internet users have been snatched away by short video platforms, which has made the domestic online audio "Three Musketeers" feel the pressure.
For example, the average monthly active users of Himalaya in 2023 will be 302.6 million, an increase of 11.4 million over 2022, and a large gap compared with the growth of 23.3 million in 2022.
With the slowdown in the growth of paying users and the decline in the payment rate, Himalaya has had to adjust its strategy, that is, to focus on attracting and retaining users with higher unit value, and enhance the sustainable development of products with greater monetization potential.
It can be seen that some important operational data of Himalaya are not performing well. In 2023, the company's average mobile monthly active paying users and mobile average monthly active paying members will be 15.8 million and 15.5 million, respectively, both slowing down significantly, while the payment rate will decline, both down by 1 percentage point.
In addition, the average daily active user listening time on Ximalaya mobile has also decreased, with 144 minutes, 142 minutes, and 130 minutes from 2021 to 2023, respectively. In this regard, Ximalaya explained that the main reason is that podcasts are becoming more and more popular on mobile, and compared to audiobooks, podcasts have a shorter content duration.
In terms of market competition, Himalaya pointed out in the prospectus that the company mainly faces fierce competition from users and their time and expenses from online audio content provided by other online audio content providers in China, such as Dragonfly FM and Lizhi. In addition to mobile applications, the Company is also competing for user engagement and attention with other major Internet companies (such as ByteDance, Tencent and Kuaishou) that provide other forms of online content such as music, literature, games and videos in emerging scenarios such as the Internet of Things (IoT) and in-vehicle devices.
Himalaya did not choose to sit idly by and chose to embrace the AI model.
In the prospectus, Ximalaya said that it plans to strengthen its AI infrastructure and AI large models focusing on audio, enhance the company's diversified, personalized and emotional service methods, and reduce production costs.
In addition, Himalaya also plans to continue to enrich its content supply, develop new content such as audio adaptations and radio dramas, and improve the product and service experience around user needs to achieve in-depth and full-range user coverage across different age groups.
Author: Far away
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