Xunlei (NASDAQ:XNET) Releases Quarterly Earnings Results

Xunlei (NASDAQ:XNET) released its quarterly earnings results on Thursday. The software maker reported ($0.03) EPS for the quarter, FiscalAI reports. The company had revenue of $102.11 million for the quarter. Xunlei had a return on equity of 1.47% and a net margin of 185.71%.

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

• Revenue increased 38.9% year over year to $102.7 million, driven by 22.6% growth in subscription revenue and strong expansion in overseas audio live streaming, alongside improved Hupu advertising.
• Overseas audio live streaming remained the primary growth engine, generating $58.2 million in revenue as Xunlei expanded in Southeast Asia, the Middle East, Turkey and Latin America through localized products and operations.
• Profitability weakened as the lower-margin live-streaming mix increased costs; gross margin fell to 55.8% from 63.0%, the company posted a $4.8 million operating loss, and non-GAAP net loss was $2.1 million.
• A $230.8 million net other loss, primarily from mark-to-market volatility in Xunlei’s Arashi Vision investment, drove a $218.5 million GAAP net loss from continuing operations versus $726.4 million of net income a year earlier.
• Xunlei began its newly authorized $20 million share repurchase program on July 1 and had repurchased approximately 1.07 million ADSs for $5.9 million by August 12, while preparing to potentially reduce its 7.8% Arashi Vision stake in compliance with regulatory requirements.

Xunlei Stock Performance

Shares of NASDAQ XNET traded up $0.09 during midday trading on Friday, hitting $5.24. The company’s stock had a trading volume of 138,707 shares, compared to its average volume of 276,632. Xunlei has a 1-year low of $4.52 and a 1-year high of $11.03. The firm’s fifty day moving average price is $5.37 and its 200-day moving average price is $5.76. The company has a debt-to-equity ratio of 0.03, a quick ratio of 2.11 and a current ratio of 2.11. The firm has a market cap of $333.23 million, a P/E ratio of 0.38 and a beta of 1.15.

Xunlei declared that its board has initiated a share buyback program on Friday, June 26th that allows the company to repurchase $0.00 in outstanding shares. This repurchase authorization allows the software maker to repurchase shares of its stock through open market purchases. Stock repurchase programs are often an indication that the company’s board believes its stock is undervalued.

Institutional Trading of Xunlei

Several hedge funds have recently made changes to their positions in XNET. Public Employees Retirement System of Ohio boosted its position in Xunlei by 3.7% during the 4th quarter. Public Employees Retirement System of Ohio now owns 57,331 shares of the software maker’s stock valued at $406,000 after purchasing an additional 2,047 shares during the period. Schonfeld Strategic Advisors LLC increased its position in Xunlei by 4.6% in the fourth quarter. Schonfeld Strategic Advisors LLC now owns 52,889 shares of the software maker’s stock worth $375,000 after buying an additional 2,313 shares during the period. Geode Capital Management LLC lifted its stake in Xunlei by 15.2% in the fourth quarter. Geode Capital Management LLC now owns 31,122 shares of the software maker’s stock valued at $221,000 after buying an additional 4,117 shares during the last quarter. Dimensional Fund Advisors LP boosted its holdings in shares of Xunlei by 0.9% during the fourth quarter. Dimensional Fund Advisors LP now owns 487,101 shares of the software maker’s stock valued at $3,455,000 after acquiring an additional 4,511 shares during the period. Finally, Walleye Capital LLC acquired a new position in shares of Xunlei during the second quarter valued at $51,000. Institutional investors own 5.07% of the company’s stock.

Analyst Upgrades and Downgrades

A number of analysts have recently issued reports on XNET shares. Wall Street Zen lowered shares of Xunlei from a “buy” rating to a “hold” rating in a research note on Saturday, May 2nd. Weiss Ratings upgraded shares of Xunlei from a “hold (c)” rating to a “hold (c+)” rating in a research note on Wednesday, June 3rd. One equities research analyst has rated the stock with a Hold rating, Based on data from MarketBeat.com, Xunlei currently has an average rating of “Hold”.

Xunlei Company Profile

Xunlei Limited (NASDAQ: XNET) is a China-based technology company specializing in content acceleration and cloud services. Its core offerings include the Xunlei download manager, which integrates peer-to-peer (P2P) and cloud-based acceleration technologies to enhance file delivery speeds for large downloads. The company has expanded its suite of products to encompass cloud storage solutions, media streaming applications and mobile browsing tools, all aimed at improving digital content distribution and user experience.

Founded in 2003 and headquartered in Shenzhen, Xunlei originally gained traction by addressing bandwidth constraints in China’s burgeoning internet market.