Nan Fang Du Shi Bao·2025-05-08 10:41Core Viewpoint - The capital market is showing a lack of confidence in the film industry, as evidenced by the planned share reduction by a major shareholder of Wanda Film, indicating ongoing challenges in the sector [1][4]. Company Summary - Wanda Film's major shareholder, Hangzhou Zhenxi Investment Management Co., plans to reduce its stake by up to 1.3927%, which amounts to over 3 billion yuan based on current stock prices [1][3]. - Hangzhou Zhenxi holds 135 million shares, representing 6.3927% of Wanda Film's total shares, and the reduction is attributed to its own business arrangements [3]. - The stock price of Wanda Film has dropped by 2.61% to 10.82 yuan per share, reflecting a significant decline from the price of approximately 51.96 yuan per share when Alibaba acquired shares in 2018 [3][4]. Financial Performance - Wanda Film's revenue for 2024 is reported at 12.362 billion yuan, a year-on-year decline of 15.44%, with a net loss of 940 million yuan, marking a staggering 203.05% drop compared to the previous year [4][5]. - The company's return on assets (ROA) has been highly unstable over the past five years, with a low of -27.39% in 2020 and a high of 3.6% in 2023, and a projected ROA of -3.96% for 2024, down 210.2% [4]. Industry Context - The overall film industry is experiencing a downturn, with Wanda Film's 2024 box office revenue declining by 22.6% to 42.502 billion yuan, and total audience numbers dropping by 22.3% [5]. - Despite the challenges, there are signs of recovery in early 2025, with Wanda Film reporting a revenue increase of 23.23% in Q1, reaching 4.709 billion yuan, and a net profit increase of 154.72% [5]. - The company has maintained a leading position in market share and audience attendance, with successful releases such as "Detective Chinatown 1900" contributing significantly to its revenue [5]. Strategic Adjustments - Alibaba's decision to reduce its stake in Wanda Film may reflect a broader strategic shift towards focusing on core business areas like cloud computing and artificial intelligence, while divesting from non-core assets [7].