Chinese streaming platform iQiyi Inc. priced its US initial public offering at US$18 per share, in the middle of its target range, Reuters reports, citing a source familiar with the matter.
The Netflix-like video platform had issued price guidance of US$17-US$19 per share. At US$18, proceeds will total US$2.25 billion.
Representatives for iQiyi did not immediately respond to an emailed request for comment.
IQiyi, which has around 50 million subscribers and whose programming includes music reality show The Rap of China and crime drama Burning Ice, will list shares from Thursday on the Nasdaq under the symbol “IQ”.
The Beijing-based company, which is majority-owned by Chinese internet search giant Baidu Inc., said it plans to use half the net proceeds from the offering to expand and enhance its content offerings.
Baidu will continue to be the company’s controlling shareholder upon completion of the offering.
IQiyi has posted losses since its inception in 2010. It reported a net loss of 3.74 billion yuan (US$594.16 million) for 2017, compared with a 3.07 billion yuan loss a year earlier.
Unlike Netflix, which makes the vast majority of revenues from subscriptions, membership service fees provided 37.6 percent of iQiyi’s revenues in 2017.
That was up from 18.7 percent in 2015, though iQiyi has said it expects it will remain around the 2017 level “for the foreseeable future”.
The rest of its revenues come from areas such as online marketing, syndication and gaming.
Goldman Sachs (Asia) LLC, Credit Suisse and BofA Merrill Lynch are the lead underwriters for the IPO.
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