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midureader.com

Founded Year

2018

Stage

Acquired | Acquired

Total Raised

$228M

About Midu Novels

Midu Novels, established by Qutoutiao, is a free mobile literature app supported by advertising.On November 8th, 2021, Midu Novels was acquired by China Literature. The terms of the transaction were not disclosed.

Midu Novels Headquarter Location

Room JT7450, Building 2, No. 4268, Zhennan Road, Jiading District

Shanghai, Shanghai, 200000,

China

+86-21-68782586

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Latest Midu Novels News

Qutoutiao Inc. Reports Fourth Quarter and Fiscal Year 2021 Unaudited Financial Results

May 2, 2022

Pudong New Area, CHINA SHANGHAI, China, May 02, 2022 (GLOBE NEWSWIRE) -- Qutoutiao Inc. (“Qutoutiao”, the “Company” or “We”, and together with its subsidiaries and controlled affiliated entities, the “Group”) (NASDAQ: QTT), a leading operator of mobile content platforms in China, today announced its unaudited financial results in the fourth quarter and fiscal year ended December 31, 2021. Fourth Quarter 2021 Highlights Net revenues was RMB881.1 million (US$138.3 million), representing a decrease of 32.3% from RMB1,302.4 million in the fourth quarter of 2020, and a decrease of 8.7% quarter-over-quarter from RMB965.5 million in the third quarter of 2021. Net loss was RMB298.0 million (US$46.8 million), compared to net loss of RMB81.8 million in the fourth quarter of 2020 and net loss of RMB583.6 million in the third quarter of 2021. Net loss margin was 33.8%, compared to 6.3% in the fourth quarter of 2020 and 60.4% in the third quarter of 2021. Non-GAAP net income/(loss)1 was RMB273.5 million (US$42.9 million), compared to non-GAAP net income of RMB50.8 million in the fourth quarter of 2020 and non-GAAP net loss of RMB525.1 million in the third quarter of 2021. Non-GAAP net loss margin was 31.0%, compared to non-GAAP net income margin of 3.9% in the fourth quarter of 2020 and non-GAAP net loss margin of 54.4% in the third quarter of 2021. Combined average MAUs2 were 97.6 million, representing a decrease of 21.7% from 124.7 million in the fourth quarter of 2020; and a decrease of 17.6% from 118.5 million in the third quarter of 2021. Combined average DAUs3 were 25.0 million, representing a decrease of 22.6% from 32.3 million in the fourth quarter of 2020; and a decrease of 5.7% from 26.5 million in the previous quarter. Average daily time spent per DAU was 43.2 minutes, compared to 50.3 minutes in the fourth quarter of 2020 and 51.9 minutes in the third quarter of 2021. Fourth Quarter 2021 Financial Results Net revenues in the fourth quarter of 2021 were RMB881.1 million (US$138.3 million), a decrease of 32.3% from RMB1,302.4 million in the fourth quarter of 2020, and a decrease of 8.7% from RMB965.5 million in the third quarter of 2021. Advertising and marketing revenues were RMB821.8 million (US$129.0 million) in the fourth quarter of 2021, a decrease of 33.8% from RMB1,241.9 million in the fourth quarter of 2020, primarily due to the tightening regulatory environment in internet and technology sector which, to some extent, resulted in constrained budgets of advertisers. Other revenues were RMB59.4 million (US$9.3 million) in the fourth quarter of 2021, a slight decrease of 1.8% from RMB60.5 million in the fourth quarter of 2020. Cost of revenues were RMB199.1million (US$31.2 million) in the fourth quarter of 2021, a decrease of 54.9% from RMB441.7 million in the fourth quarter of 2020, primarily attributable to decreases in IT infrastructure costs; gaming revenue sharing; integrated marketing service costs which are in line with the decrease in integrated marketing service revenues; and costs related to live-streaming revenue sharing and compensation expenses. Gross profit was RMB682.0 million (US$107.0 million) in the fourth quarter of 2021, a decrease of 20.8% from RMB860.7 million in the fourth quarter of 2020. Gross margin was 77.4%, compared to 66.1% in the fourth quarter of 2020. The improved gross margin was primarily attributed to changes in product mix. Research and development expenses were RMB88.7 million (US$13.9 million) in the fourth quarter of 2021, a decrease of 55.6% from RMB199.7 million in the fourth quarter of 2020 primarily due to a reduction in overall research and development headcount and consequentially the decrease in compensation expenses, including share-based compensations. Sales and marketing expenses were RMB796.0 million (US$124.9 million) in the fourth quarter of 2021, an increase of 17.0% from RMB680.3 million in the fourth quarter of 2020, primarily due to the expansion of Midu Novels. Sales and marketing expenses as a percentage of net revenues were 90.3% in the fourth quarter of 2021, compared to 52.2% in the fourth quarter of 2020. User engagement expenses were RMB156.5 million (US$24.6 million) in the fourth quarter of 2021, representing a decrease of 4.1% year-over-year. User engagement expenses per DAU per day were RMB 0.07 in the fourth quarter of 2021, compared to RMB0.05 in the fourth quarter of 2020. User acquisition expenses were RMB599.8 million (US$94.1 million) in the fourth quarter of 2021, an increase of 51.0% year-over-year. User acquisition expenses consist of the costs of both word-of-mouth referrals and third-party marketing. The year-over-year increase was primarily due to the expansion of Midu Novels. User acquisition expenses per new installed user4 in the fourth quarter of 2021 were RMB8.26, compared to RMB7.89 in the fourth quarter of 2020. Other sales and marketing expenses were RMB39.7 million (US$6.2 million) in the fourth quarter of 2021, representing a decrease of 66.9% year-over-year from RMB119.9 million in the fourth quarter of 2020, primarily due to an overall headcount reduction in sales personnel and consequentially the decrease in compensations as well as ESOP expenses and decrease in brand promotion expenses. General and administrative expenses were RMB62.6 million (US$9.8 million) in the fourth quarter of 2021, a decrease of 33.7% from RMB94.4 million in the fourth quarter of 2020, mainly due to a reduction in overall administrative headcount and consequentially the decrease in compensations as well as ESOP expenses. The decrease was partially offset by an increase in additional expected credit loss provision recorded in the fourth quarter of 2021 under ASC 326, Measurement of Credit Losses on Financial Instruments. Loss from operations was RMB247.8 million (US$38.9 million) in the fourth quarter of 2021, compared to RMB90.1 million in the fourth quarter of 2020. Operating loss margin was 28.1%, compared to 6.9% in the fourth quarter of 2020. Non-operating loss was RMB45.2 million (US$7.1 million) in the fourth quarter of 2021, which mainly included investment loss of RMB36.8 million due to impairment loss on certain investments as well as net interest expenses of RMB8.3 million. Non-operating gain for the fourth quarter of 2020 was RMB7.9 million, which mainly included RMB20.0 million gain associated with fair value changes on long-term investments, offset by net interest expenses of RMB9.5 million. Non-GAAP loss from operations was RMB223.3 million (US$35.0 million) in the fourth quarter of 2021, compared to a Non-GAAP gain from operations of RMB42.5 million in the fourth quarter of 2020. Non-GAAP operating loss margin was 25.3% in the fourth quarter of 2021, compared to a Non-GAAP operating gain margin of 3.3% in the fourth quarter of 2020. Net loss was RMB298.0 million (US$46.8 million) in the fourth quarter of 2021, compared to RMB81.8 million in the fourth quarter of 2020. Net loss margin was 33.8%, compared to 6.3% in the fourth quarter of 2020. Non-GAAP net loss was RMB273.5 million (US$42.9 million) in the fourth quarter of 2021, compared to a Non-GAAP net gain of RMB50.8 million in the fourth quarter of 2020. Non-GAAP net loss margin was 31.0%, compared to a Non-GAAP net gain margin of 3.9% in the fourth quarter of 2020. Net loss attributable to Qutoutiao Inc.'s ordinary shareholders was RMB326.3 million (US$51.2 million) in the fourth quarter of 2021, compared to RMB78.7 million in the fourth quarter of 2020. Non-GAAP net loss attributable to Qutoutiao Inc.'s ordinary shareholders was RMB301.8 million (US$47.4 million) in the fourth quarter of 2021, compared to RMB54.0 million in the fourth quarter of 2020. Basic and diluted net loss per American Depositary Share (“ADS”) was RMB10.69 (US$1.68) in the fourth quarter of 2021. Non-GAAP basic and diluted net loss per ADS was RMB9.88 (US$1.55) in the fourth quarter of 2021. Balance Sheet As of December 31, 2021, the Company had cash, cash equivalents, restricted cash and short-term investments of RMB658.9 million (US$103.4 million), compared to RMB985.8 million as of December 31, 2020. The Group has incurred accumulated and recurring losses from operations, and cash outflows from operating activities. As of December 31, 2021, the Company had a negative working capital. In addition, the convertible loan of the Company with principal amount of US$171.1 million (RMB1,109.3 million) had the original maturity date on April 4, 2022. The Company is currently exploring a variety of measures to improve the Group’s liquidity and financial position, which include continuing efforts to optimize its user loyalty programs and traffic acquisition strategy to efficiently control and reduce costs and continuing to be selective in its content and better leverage its existing content varieties to attract and maintain users. These measures can in turn lead to savings in user related costs. The Company is also planning to preserve liquidity and manage cash flows by reducing expenditure on developing and maintaining smaller and novel applications and limiting other general and administrative expenses, to obtain additional external financing and funds through, including but not limited to, additional credit facilities obtained from banks in the normal course of business, potential additional issuances of equity and/or debt as a Group or through its subsidiaries, and sale of its assets, including the Group’s equity interest in its subsidiaries, to third parties. The Company and the creditor entered into two supplemental agreements to the original convertible loan agreement on March 28, 2022 and April 29, 2022, respectively. According to the supplemental agreements, the original convertible loan has been extended to May 28, 2022. The total amount of principal and accumulated interest as of May 28, 2022 will be approximately RMB1.5 billion. The Company cannot assure that it will be able to further extend the maturity date of the convertible loan. Facts and circumstances including accumulated and recurring losses from operations, net cash used in operating activities, negative working capital and uncertainties on the repayment of the convertible loan, raise substantial doubt about the Group’s ability to continue as a going concern. The fourth quarter and fiscal year 2021 unaudited financial information does not include any adjustment that is reflective of this uncertainty. Fiscal Year 2021 Financial Results Net revenues in the fiscal year of 2021 were RMB4,339.6 million (US$681.0 million), a decrease of 17.9% from RMB5,285.2 million in the fiscal year of 2020. Advertising and marketing revenues were RMB4,090.4 million (US$641.9 million) in the fiscal year of 2021, a decrease of 19.0% from RMB5,046.8 million in the prior year, primarily due to the tightening regulatory environment in internet and technology sector which, to some extent, resulted in constrained budgets of advertisers. Other revenues were RMB249.2 million (US$39.1 million) in the fiscal year of 2021, an increase of 4.6% from RMB238.4 million in the fiscal year of 2020. Cost of revenues was RMB1,171.6 million (US$183.9 million) in the fiscal year of 2021, a decrease of 30.0% from RMB1,674.4 million in the fiscal year of 2020, primarily attributable to the decrease in bandwidth and IT infrastructure costs, integrated marketing service costs which are in line with the decrease in integrated marketing service revenues, salaries and benefits associated with content management personnel as well as live-streaming and online games revenue share. The decrease was partially offset by an increase in Midu content procurement costs. Gross profit was RMB3,168.0 million (US$497.1 million) in the fiscal year of 2021, a decrease of 12.3% from RMB3,610.8 million in the prior year. Gross margin was 73.0%, compared to 68.3% in the fiscal year of 2020. Research and development expenses were RMB551.6 million (US$86.6 million) in the fiscal year of 2021, a decrease of 41.8% from RMB947.9 million in the prior year, primarily due to the reduction in research and development headcount and sequentially a decrease in salaries as well as ESOP expenses. Sales and marketing expenses were RMB3,483.8 million (US$546.9 million) in the fiscal year of 2021, a slight increase of 3.0% from RMB3,381.6 million in the fiscal year of 2020. General and administrative expenses were RMB431.9 million (US$67.8 million) in the fiscal year of 2021, an increase of 10.0% from RMB392.8 million in the fiscal year of 2020, primarily due to an increase in additional expected credit loss provision recorded in 2021 under ASC 326, Measurement of Credit Losses on Financial Instruments, which was partially offset by decrease in salaries as well as other administrative expenses. Loss from operations was RMB1,193.2 million (US$187.2 million), compared to RMB1,032.2 million in the fiscal year of 2020. Operating loss margin was 27.5%, compared to 19.5% in the fiscal year of 2020. Non-GAAP loss from operations was RMB993.0 million (US$155.8 million), compared to RMB569.0 million in the fiscal year of 2020. Non-GAAP operating loss margin was 22.9%, compared to non-GAAP operating loss margin of 10.8% in the fiscal year of 2020. Net loss was RMB1,240.2 million (US$194.6 million) in the fiscal year of 2021, compared to a net loss of RMB1,105.2 million in the fiscal year of 2020. Net loss margin was 28.6%, compared to 20.9% in the fiscal year of 2020. Non-GAAP net loss was RMB1,040.0 million (US$163.2 million), compared to Non-GAAP net loss of RMB642.0 million in the fiscal year of 2020. Non-GAAP net loss margin was 24.0%, compared to 12.1% in the fiscal year of 2020. Net loss attributable to Qutoutiao Inc.'s ordinary shareholders was RMB1,348.5 million (US$211.6 million), compared to RMB1,137.9 million in the fiscal year of 2020. Non-GAAP net loss attributable to Qutoutiao Inc.'s ordinary shareholders was RMB1,148.3 million (US$180.2 million), compared to RMB674.7 million in the fiscal year of 2020. Recent Development Change to the Board of Directors Mr. Lei Li resigned as Vice Chairman of the Board of Directors of the Company due to personal reasons. The resignation became effective on April 29, 2022. Following his resignation, the Board of the Company is now comprised of five members. About Qutoutiao Inc. Qutoutiao Inc. operates a mobile content platforms in China with a mission to bring fun and value to its users. The eponymous mobile application, Qutoutiao, meaning “fun headlines” in Chinese, applies artificial intelligence-based algorithms to deliver customized feeds of articles and short videos to users based on their unique profiles, interests and behaviors. Qutoutiao has attracted a large group of users, many of whom are from lower-tier cities in China. They enjoy Qutoutiao’s fun and entertainment-oriented content as well as its social-based user loyalty program. Midu, first launched in May 2018 as Midu Novels and with an alternative version Midu Lite launched one year later, pioneered provision of free online literature supported by advertising. It has been one of the market leaders of the free online literature industry since inception. The Company will continue to bring more exciting products to users through innovation, and strive towards creating a leading global online content ecosystem. For more information, please visit: https://ir.qutoutiao.net . Use of Non-GAAP Financial Measures We use non-GAAP profit or loss from operations, non-GAAP operating profit or loss margin, non-GAAP net profit loss, non-GAAP net profit or loss margin, non-GAAP net profit or loss attributable to Qutoutiao Inc.’s ordinary shareholders and non-GAAP basic and diluted net profit or loss per ADS, which are non-GAAP financial measures, in evaluating our operating results and for financial and operational decision-making purposes. Each of these non-GAAP financial measures represents the corresponding GAAP financial measure before share-based compensation expenses. We believe that such non-GAAP financial measures help identify underlying trends in our business that could otherwise be distorted by the effect of such share-based compensation expenses that we include in cost of revenues, total operating expenses and net loss. We believe that all such non-GAAP financial measures also provide useful information about our operating results, enhance the overall understanding of our past performance and future prospects and allow for greater visibility with respect to key metrics used by our management in its financial and operational decision-making. The non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. They should not be considered in isolation or construed as alternatives to net loss or any other measure of performance prepared in accordance with U.S. GAAP or as an indicator of our operating performance. We mitigate these limitations by reconciling the non-GAAP financial measures to the most comparable U.S. GAAP performance measures, all of which should be considered when evaluating our performance. For more information on these non-GAAP financial measures, please see the table captioned “Reconciliations of GAAP and Non-GAAP Results” set forth at the end of this press release. Exchange Rate Information This announcement contains translations of certain RMB amounts into U.S. dollars at a specified rate solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to U.S. dollars are made at a rate of RMB6.3726 to US$1.00, the rate in effect as of December 31, 2021 as set forth in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or US$ amounts referred could be converted into US$ or RMB, as the case may be, at any particular rate or at all. Safe Harbor Statement This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Statements that are not historical facts, including statements about Qutoutiao's beliefs, plans and expectations, are forward-looking statements. Among other things, the “Business Outlook” section and quotations from management in this announcement, contain forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: Qutoutiao’s strategies; Qutoutiao’s future business development, financial condition and results of operations; Qutoutiao’s ability to retain and increase the number of users and provide quality content; competition in the mobile content platform industry; Qutoutiao’s ability to manage its costs and expenses; the future developments of the COVID-19 pandemic; general economic and business conditions globally and in China; and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in Qutoutiao's filings with the SEC. All information provided in this press release is as of the date of this press release, and Qutoutiao does not undertake any obligation to update any forward-looking statement, except as required under applicable law. For investor and media inquiries, please contact: Qutoutiao Inc.

  • When was Midu Novels founded?

    Midu Novels was founded in 2018.

  • Where is Midu Novels's headquarters?

    Midu Novels's headquarters is located at Room JT7450, Building 2, No. 4268, Zhennan Road, Jiading District, Shanghai.

  • What is Midu Novels's latest funding round?

    Midu Novels's latest funding round is Acquired.

  • How much did Midu Novels raise?

    Midu Novels raised a total of $228M.

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