Core Viewpoint - The article emphasizes the significant shift in content consumption habits towards "micro-dramas" on iQIYI, highlighting the company's strategic pivot in response to changing viewer preferences and declining revenues from traditional long-form content [1][3]. Financial Performance - In Q1 2025, iQIYI reported total revenue of 7.19 billion yuan, a year-on-year decline of 9%. The net profit attributable to iQIYI was 182.1 million yuan, down 72% year-on-year. Non-GAAP net profit was 304.4 million yuan, a decrease of approximately 64% [1][2]. - Membership service revenue accounted for over half of total revenue, amounting to 4.4 billion yuan, a year-on-year decrease of 8%, primarily due to a reduction in content release volume compared to the previous year [2]. - Online advertising service revenue was 1.33 billion yuan, down 10% year-on-year, attributed to declines in brand advertising and a slight decrease in performance advertising revenue [2]. - Content distribution revenue was 630 million yuan, down 32% year-on-year, mainly due to reduced income from TV series and films [2]. - Total costs for the quarter were 5.41 billion yuan, a year-on-year decrease of 4%, with content costs at 3.79 billion yuan, down 7% [2]. Strategic Shifts - iQIYI's CEO mentioned that the habit of watching micro-dramas is forming among users, with heavy users increasing threefold from December to April [1]. - The company has approximately 15,000 micro-dramas on its platform, with half being paid and half free. Successful titles like "Home and Away" and "Please Enter My Embrace" quickly surpassed 1 million yuan in revenue within a week [1]. - iQIYI announced the rebranding of its "极速版" to "iQIYI Micro-Short Drama App," focusing on free micro-short dramas [3]. - The company aims to attract new members through micro-dramas, particularly in underpenetrated markets and among older users, while also exploring monetization opportunities in advertising and e-commerce [4]. Content Strategy - Despite the focus on micro-dramas, iQIYI will continue to invest in long-form content, with plans to reduce the number of episodes and duration to enhance quality [4]. - The company has launched "content e-commerce" initiatives and started a VR immersive theater project [4]. - As of March 31, 2025, iQIYI's cash balance totaled 5.7 billion yuan, indicating a stable financial position [4].