Q2 2025 Xunlei Ltd Earnings Call Transcript
Key Points
- Xunlei Ltd (XNET) reported a year-over-year revenue growth of 30.6%, demonstrating strong performance across key business segments.
- The Subscription business generated $36.4 million in revenue, reflecting a 10.5% increase compared to the same period in 2024, with a record number of 6.4 million subscribers.
- Live-Streaming and Other Services achieved a strong year-over-year revenue growth of 85.5%, largely driven by the expansion of the overseas Audio Live-Streaming business and advertising revenue from the acquisition of Hupu.
- The Cloud Computing business brought in $30 million in revenue, marking a 13.6% increase compared to the same period in 2024, due to recovery from previous setbacks and rising demand from major clients.
- Xunlei Ltd (XNET) booked approximately $720 million in realized pretax capital gains from its investment in Arashi Vision Inc., providing a solid foundation for future growth opportunities.
- Despite the revenue growth, the gross profit margin decreased to 49.3% in Q2 2025 from 51.1% in the same period of 2024, mainly due to decreased margins in the Cloud Computing business.
- Sales and marketing expenses increased significantly to $21.6 million, representing 20.8% of total revenues, up from 13.7% in the same period of 2024, primarily due to increased marketing efforts.
- The Live-Streaming business, although growing, is still in the investment phase and currently losing money.
- The Cloud Computing segment, despite improved performance, is still not profitable.
- The cost of revenues increased to $52.3 million, representing 50.3% of total revenues, up from 48.5% in the same period of 2024, mainly due to increased bandwidth costs and revenue sharing expenses.
Welcome, ladies and gentlemen, and thank you for your patience. You've joined Xunlei's second-quarter 2025 earnings conference call. (Operator Instructions) Please be advised that today's conference is being recorded. I'd now like to turn the call over to the host, Investor Relations Manager, Ms. Luhan Tang.
Good morning, and good evening, everyone, and thank you for joining Xunlei's Q2 2025 earnings conference call. With me today are Eric Zhou, CFO; and Lee Li, Vice President of Finance. Our IR website has our earnings press release to supplement our prepared remarks during the call.
Today's agenda includes a prepared opening remarks from Chairman and CEO, Mr. Jinbo Li on Q2 operational highlights, followed by CFO, Eric Zhou's presentation of financial results details of Q2 2025 and revenue guidance for Q3 2025, before I open up the floor to your questions in the Q&A session. Please note that this call is recorded and can be replayed on our Investor Relations website at ir.xunlei.com.
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