Meitu's "coin speculation" has experienced two extremes.
On the evening of July 3, Meitu announced that the company may record a net loss of about 274.9 million to 349.9 million yuan in the first half of the year, mainly due to the impairment of the purchased cryptocurrencies.
At present, Meitu is optimistic about the prospect of this investment.
Previously, in 2021, Meitu made a floating profit of nearly 400 million yuan due to its investment in cryptocurrencies.
Meitu, which was once famous for its photo editing software Meitu Xiuxiu, has gradually become quiet in recent years.
According to the Beijing News Shell Finance reporter, Meitu has continuously adjusted its corporate strategy in recent years.
In 2018, Meitu made its beauty business run by Secoo Investment Company; it authorized the brand, imaging technology and second-level domain name of its Meitu mobile phone to Xiaomi Group.
However, Meitu has already taken back the authorization of Meitu mobile phones in 2021.
In addition, Meitu's total monthly active users have declined in recent years.
On July 4, 2022, affected by the news of the floating loss of currency speculation, Meitu opened higher and lower after the opening, with a drop of more than 10%.
As of the close, Meitu closed at HK$0.93 per share, down 10.58%.
Last year, the "special currency" floating profit was nearly 400 million, and the expected loss in the first half of this year is about 300 million
Meitu makes hot searches from time to time by relying on "specializing coins".
On the evening of July 3, Meitu issued an announcement stating that it has initially reviewed the unaudited consolidated management accounts of the group for the five months ended May 31, 2022, and it is expected that the group may record a record for the six months ended June 30, 2022. A net loss of about 274.9 million yuan to 349.9 million yuan was obtained, and the net loss increased by about 99.6% to 154.1% year-on-year.
The expected increase in net loss is mainly due to impairment of purchased cryptocurrencies.
Meitu's "coin speculation" is like a roller coaster ride.
In early 2021, the value of cryptocurrencies such as Bitcoin moved higher.
Meitu has purchased 100 million yuan of cryptocurrencies in batches since March of that year, joining the army of speculators.
At the high point, Meitu’s highest floating profit exceeded 100 million yuan.
However, starting in early May of that year, the Bitcoin index plummeted several times, and Meitu-related investment income also suffered losses.
In May 2021, at the Meitu performance conference, regarding whether to continue investing in cryptocurrencies, Meitu CEO Wu Xinhong said that there are currently no plans, because the amount approved by the board of directors is 100 million US dollars, which is the only amount for the time being.
"Buying cryptocurrencies is more about asset allocation and overseas business layout, and will not be short-term operations."
Cryptocurrencies have been on the rise and fall, though.
According to the financial report, as of December 31, 2021, the fair value of Bitcoin purchased by Meitu as of December 31, 2021 decreased by approximately RMB 28.5 million, which has been recognized as impairment, and the fair value of purchased Ethereum as of December 2021. The increase of about 425.6 million yuan on the 31st was not recognized as a revaluation gain.
Based on this calculation, in 2021, Meitu will purchase cryptocurrencies for 100 million US dollars. As of December 31, 2021, the floating profit will be 62.4 million US dollars, or about 397 million yuan.
At the same time, Meitu's revenue in 2021 will be 1.666 billion yuan, a year-on-year increase of 39.5%; the adjusted net profit attributable to company owners is 85.1 million yuan, a year-on-year increase of 39.7%.
In 2021, Meitu's cryptocurrency investment income will far exceed the company's operating net profit.
Regarding the profit and loss of cryptocurrencies in the first half of 2022, Meitu stated that the impairment loss of the purchased cryptocurrencies will not have any significant impact on the cash flow and net operating profit in the group's interim results.
In addition, cryptocurrencies are still in their infancy, and their prices tend to be vulnerable to volatility, but the blockchain industry is still developing rapidly, and cryptocurrencies have ample room for growth.
The board remains optimistic about the long-term prospects of purchased cryptocurrencies.
Ding Daoshi, a senior Internet observer, believes that if a company makes money by investing in virtual currency, it is more cause for concern, because it will create a bad cognition that does not need to work hard, does not focus on business, and makes money by hyping empty-headed things , not the positive way of business operation.
Therefore, it is a good thing to lose money at this time, and stay away from these unsustainable things as soon as possible.
The strategy is constantly adjusted, and the platform activity will decline in 2021
In August 2018, Cai Wensheng, chairman of Meitu, announced the company's new strategy: in the next ten years, while continuing to explore "beauty", it will enter the "social" field.
In November of that year, Meitu announced that the beauty business would be operated by Secoo Investment Company.
At the same time, Xiaomi Group and Meitu have reached a strategic cooperation, and Xiaomi will obtain the exclusive authorization of Meitu mobile phones and smart hardware products for up to 30 years.
Meitu exclusively licenses the brand, imaging technology and second-level domain names of its Meitu mobile phones to Xiaomi Group worldwide.
The authorized Meitu mobile phone will be developed, produced, sold and promoted by Xiaomi; Meitu will continue to provide joint support for imaging technology and beauty algorithms.
But the collaboration didn't last long.
Regarding the progress of the cooperation between Meitu and Xiaomi smartphone authorization.
In March 2021, at Meitu's 2020 annual results conference, Meitu CEO Wu Xinhong said that Meitu will no longer enter the mobile phone manufacturing and sales industry in the future; as for the progress of cooperation with Xiaomi, Meitu has already taken it back Authorized by Meitu Mobile.
In fact, after 2018, Meitu has continued to adjust.
In February 2019, Meitu announced that it planned to acquire a 31% stake in an indirect wholly-owned subsidiary of Hong Kong-listed game company Leyou Technology at a transaction consideration of HK$2.687 billion.
However, the deal eventually "aborted".
In August of that year, Meitu strategically invested about 57.09% of Dajie.com by issuing shares and paying cash, with a total transaction amount of about HK$395 million.
At present, Meitu's revenue sources consist of online advertising, VIP subscription and video SaaS, Internet value-added services, and IMS.
The stable growth of the company's total revenue and adjusted net profit in 2021 is mainly driven by the VIP subscription and imaging SaaS business.
Among them, online advertising revenue was 766 million yuan, a year-on-year increase of 12.5%; VIP subscription and image SaaS revenue was 519 million yuan, a year-on-year increase of 146.9%.
However, judging from the platform activity data, in recent years, the overall user activity on the Meitu platform has declined.
According to the financial report, as of the end of 2019, Meitu had a total of 282.5 million monthly active users.
As of December 31, 2021, Meitu had a total of 231 million monthly active users, down 11.6% year-on-year.
From the age of pictures to the age of videos, can Meitu still be "beautiful"?
In early 2022, Meitu founder and CEO Wu Xinhong once told the media: "Meitu was born in the era of pictures, but now pictures are being squeezed by videos, and more and more people are going to videos whether they are shooting, sharing or consuming content. Rely on. So what Meitu is doing now is, on the one hand, to maintain its advantages in the field of pictures, and on the other hand to try to capture the new needs of young people.”
In March 2021, Meitu launched 6 new image products including Wink, Chic, Meitu Xiuxiu for Mac, Meitu Design Studio, Meitu Cloud Repair, and Meitu ID Photo.
Wink is a video-oriented product.
However, the industry generally believes that in the video era, Meitu is not the first company to eat crabs.
At present, there are many video editing and beautification tools on the market. It is unclear whether Meitu Wink can achieve the same success as Meitu Xiuxiu.
"Meitu's products are pretty good. If we can improve from image processing to video processing, and do a good job of this social system, then the company's real breakthrough will be. In recent years, the company has been engaged in some things that have nothing to do with its main business. It is difficult to succeed in the investment activities of the company. I hope that Meitu will return to its essence and provide consumers with some reliable products and services, and there are still opportunities in the market.” Ding Daoshi said.
Beijing News Shell Finance reporter Chen Weicheng