Quora's Chinese Rival Zhihu Stock Slides After Mixed Q3 Results - Here's Why
Portfolio Pulse from Anusuya Lahiri
Zhihu Inc (NYSE:ZH) reported Q3 FY23 revenue of $140.1 million, a 12.1% increase Y/Y but below the consensus of $143.6 million, leading to a stock price decline. Adjusted loss per ADS was $(0.05), better than the expected $(0.06). Marketing services revenue fell 17.1% Y/Y, while paid membership and vocational training revenues grew significantly. MAUs and monthly paying members increased. Gross margin decreased due to monetization efforts and cloud services. The company has $775 million in cash and equivalents. ZH shares dropped 1% to $1.01.
November 29, 2023 | 3:30 pm
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NEGATIVE IMPACT
Zhihu Inc reported lower-than-expected Q3 revenue and a decrease in marketing services revenue, but outperformed EPS estimates. The stock price fell by 1% following the announcement.
The stock price decline is directly related to the revenue miss and the contraction in the marketing services segment. However, the better-than-expected EPS and growth in memberships and training may cushion the negative impact. The 1% decline in stock price post-earnings indicates a negative short-term sentiment.
CONFIDENCE 90
IMPORTANCE 75
RELEVANCE 100