Xiaoying Technology IPO withdrawal: 60 % of the revenue of a single product, the ace products are cut -off, and the business compliance is doubtful

Picture source: Oriental IC

Recently, the official website of the Shenzhen Stock Exchange showed that Hangzhou Xiaoying Innovation Technology Co., Ltd. (hereinafter referred to as "Xiaoying Technology") applied for the withdrawal and issuance of listing application documents. According to relevant regulations, the Shenzhen Stock Exchange decided to terminate its first public offering of shares and listed on the GEM.

At present, Xiaoying Technology's IPO review status has been changed. This is less than one year before its application for listing in September 2021. The dream of "the first share of video editing" is broken.

Why did Xiaoying Technology missed the A -share capital market? In this regard, a reporter from Blue Whale Finance sent an interview letter to the company, and there was no response to the other party for the time being.

Revenue profit has risen year by year, and the small shadow app has contributed more than 60 % of revenue

The prospectus shows that Xiaoying Technology is a mobile video creation software and service provider. It is mainly engaged in the design, research and development, and sales promotion of mobile video creation software products and services.

The company's main products include mobile video creation software such as Vivavideo, Vivacut and Tempoapp. Due to Douyin, the shelter of fast hands, and the rapid development of fast shadows in China, Xiaoying Technology chose software to go out to sea, and its products developed to more than 200 countries and regions around the world.

From 2019 to 2021 (hereinafter referred to as the "reporting period"), the revenue of Xiaoying Technology was 196 million yuan, 302 million yuan, and 385 million yuan; the net profit attributable to approximately -50.5531 million yuan, 43.169 million yuan, and 820.86 million Yuan; After deduction, the net profit attributable to was about -104.635 million yuan, 46.843 million yuan, and 74.2823 million yuan, respectively.

Xiaoying Technology said that the company's revenue mainly comes from mobile video creation software subscription business. During the reporting period, its subscription revenue was 167 million yuan, 285 million yuan, and 314 million yuan, respectively, accounting for 85.68%, 94.6%, and 81.57%of the revenue.

In the mobile video creation software subscription business, the subscription revenue of Xiaoying APP has long contributed more than 60 % of revenue. During the reporting period, the subscription revenue of Xiaoying APP was 156 million yuan, 240 million yuan, and 246 million yuan, respectively, accounting for 79.91%, 79.56%, and 63.92%of the company's current revenue.

Except for the Xiaoying APP, the remaining two main products do not have much sound in the market, and their contributions to revenue are also very limited. It can be seen that Xiaoying Technology has a high dependence on a single product.

Xiaoying Technology also said that if the Xiaoying APP cannot be updated in a timely manner, or the operating strategy has a deviation, it cannot meet the needs of user needs, which may lead to a decline in the market share of the product, which will adversely affect the operating performance.

Some analysts pointed out that Xiaoying Technology only rely on the explosive "small shadow" and cannot establish the moat. In the video editing industry, in addition to Xiaoying, there are third -party mobile video creation software such as VideoLeap and Splice, as well as The creative software launched by the head short video platform will further intensify the future industry competition, and the living space of Xiaoying Technology will be squeezed.

The number of new users and the monthly work of the ace product is two -handed

It can be seen from the prospectus that Xiaoying Technology has only achieved profit in 2021, and has been in a loss of money in the past two years.

Regarding the loss during the reporting period, Xiaoying Technology explained that in 2018 and 2019, the company's VIDSTAS products have invested large investment and the employee shares payments are high, resulting in two consecutive years of losses.

Although the company has improved its product operation capabilities and monetization capacity since 2020, the cost and costs invested after the transformation of VIDSTAS products have decreased, which has increased its operating performance in 2020 and January to June 2021. The year -on -year decline in operating profits may exceed 50%, and even losses have occurred.

According to the prospectus, in 2020 and 2021, Vidstatus's product revenue was 7.7175 million yuan and 14.791 million yuan, respectively, accounting for 2.56%and 3.76%of the current total revenue.

Xiaoying Technology said that after the positioning of VIDSTATUS products, it will no longer focus on its short video community business. The future income of the product may decline, which will adversely affect the company's operating performance.

It is worth mentioning that during the reporting period, the number of newly added registered users and average monthly active users of Xiaoying Technology's ace product Xiaoying APP have been cut. Among them, the average number of monthly active users dropped from 32.431 million in 2019 to 15.359 million in 2021; the number of registered users dropped from 170 million in 2019 to 72.341 million in 2021.

The main function of the small shadow app is to provide users with basic editing functions, such as timeline display, adding background and subtitles, multiple video ratios, multi -track music, voice transfer text, etc. At the same time, it includes fonts, stickers, music, filters, special effects and transit.

"But these functions are not obviously different from the video editing software launched by the giant. Xiaoying Technology does not have more differentiated competitiveness in terms of product functions. The development potential is greater. "The above analysts pointed out.

The business coordination was questioned. The product had been removed in the Indian market before the withdrawal of the IPO application. Xiaoying Technology disclosed two rounds of inquiry response opinions. Among them, the company's business compliance was inquired by the Shenzhen Stock Exchange.

The prospectus shows that in addition to mobile video creation software subscription business income, part of the income of Xiaoying Technology comes from the Internet advertising service business and live broadcast business.

In the first round of inquiries, the Shenzhen Stock Exchange requested Xiaoying Technology to combine relevant regulations to analyze the company's main responsibility for whether the advertisement published in the product, and the compliance and responsibility division of the compliance and responsibilities released by advertising content in the product at home and abroad. The situation; in addition, it also requires it to explain whether there is a situation that does not meet the business development conditions and qualifications to carry out business during the live broadcast business.

In October 2018, Xiaoying Technology chased the air outlet to launch its own live product. Users can watch the live broadcast of the anchor online through this product, and they can also recharge the purchase of Star Beans to redeem virtual gifts and give it to the anchor.

However, the business progress is not smooth. From 2018 to the first half of 2021, the live broadcast business revenue was 714,500, 11.982 million, 213,300, and 0.21 million, respectively, with revenue ratio of 1.21%, 6.12%, 0.07%, and 0%. As the business cannot effectively support the development of the main business, Xiaoying Technology announced that it will no longer start the live broadcast platform in December 2019.

In the second round of inquiries, the compliance of Xiaoying Technology's business was once again asked. The Shenzhen Stock Exchange requires it to distinguish between domestic and overseas products, explaining the differences in operating content of domestic and overseas products. Problems such as service compliance.

In this regard, the company explained that, except for MAST and VIDSTATUS 2 main operating countries in India, the remaining products are operated simultaneously at home and abroad. The domestic and overseas versions of related products are designed in UI, editing editing modules, and material modules. Basically the same function.

In recent years, the operating environment of domestic Internet companies in overseas has become increasingly complicated. In June 2020, the Indian Information and Technology Department announced that it was announced on the grounds that "sovereign security and privacy information were threatened", and announced the release of 59 Chinese application software, including Xiaoying, including Xiaoying in the Indian market.

Xiaoying Technology stated that this move caused the small shadow app to not get new users in India, which instructed to adversely affect the business development and income of the product in India.

"The company's main layout of overseas markets will face more supervision in the future, which will challenge them to expand and serve overseas users. At the same time, the industry competition has intensified and depends on a single product. The profitability will be tested, "said the above analysts.

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