Core Viewpoint - The overall performance of the company in 2023 was mediocre, particularly in comparison to market expectations that were already lowered due to the delay of "With the Phoenix" [1][2]. Revenue Summary - The company's total revenue for the second half of 2023 was 3,729 million RMB, which was slightly below market expectations of 3,731 million RMB, reflecting a year-on-year growth of 5.4% [4]. - The online business revenue for the second half of 2023 was 1,909 million RMB, down 72% year-on-year, which was also below the expected 1,955 million RMB [4][15]. - The copyright operation revenue showed a significant year-on-year increase of 38%, excluding the contribution from New Classics Media [2][19]. Online Literature Performance - The company shifted its strategy in the second half of 2022 to focus on paid premium content, resulting in a decrease in total user scale but an increase in the payment rate [2][6]. - Online business revenue for the second half of 2023 was 1,900 million RMB, down 7% year-on-year, slightly below the expected 1,960 million RMB [15][17]. - Free reading revenue (advertising) decreased by 32%, while paid reading revenue saw a smaller decline of 3.7% [2][17]. Copyright Operations - Copyright operations have become a significant revenue source, contributing nearly half of the company's income, especially during the downturn in online literature [19][26]. - The revenue from copyright operations reached 1,784 million RMB in the second half of 2023, with a year-on-year growth of 38% when excluding New Classics Media [19][25]. New Classics Media Performance - New Classics Media experienced a 9% growth in revenue in the second half of 2023, despite the delay of key productions [3][19]. - The company has several upcoming high-quality productions, including "With the Phoenix," which began airing in March 2024 [3][21]. Marketing and Cost Management - Marketing expenses increased in the second half of 2023 due to the launch of new content, but overall sales expenses remained stable as employee costs were reduced [25][26]. - The company reduced its workforce by approximately 100 employees, leading to a 15% decrease in employee welfare expenses [25][26]. Cash Flow and Financial Health - The company reported a robust cash flow, with nearly 1 billion RMB in free cash flow and approximately 2.8 billion RMB in available cash [28]. - The net cash position stands at 6.2 billion RMB, representing 24% of the current market capitalization of 27.9 billion HKD [28].
阅文集团：网文垂暮，短剧续命？