iQIYI Posts Q2 2025 Loss as Revenue Slides 11% Amid Subscription and Ad Declines

Overall revenue for the quarter fell to CNY 66.3 billion, an 11 percent drop from the previous year. The decline was driven by two core businesses. Membership services—iQIYI’s primary subscription offering—generated CNY 40.9 billion, down 9 percent year‑on‑year. Analysts attribute the slide to a thinner slate of new content, which appears to have dampened both renewal rates and the willingness of users to sign up for new plans. Online advertising, another key pillar, slipped to CNY 12.7 billion, a 13‑percent contraction, reflecting tighter marketing budgets as advertisers respond to a sluggish macro‑economic environment.

Total costs eased to CNY 52.9 billion, 7 percent lower than a year ago, but the savings were not enough to offset the revenue shortfall. Content expenses alone stood at CNY 37.8 billion, underscoring how the platform’s heavy investment in programming continues to weigh on the bottom line.

The shift from profit to loss has reignited concerns among investors about iQIYI’s long‑term viability. Shares swung sharply in the wake of the announcement, with traders watching closely for signs that the company can translate its considerable cash reserves—reported at CNY 5.06 billion—into sustainable earnings. The market is also eyeing the upcoming summer slate, hoping that high‑profile dramas such as “Seven Nights Snow” and “Go to the Mountains and Seas” can inject fresh subscriber interest and bolster ad sales.

Public sentiment on China’s leading social‑media platform, Weibo, mirrors the investor unease. Users expressed disbelief that a company turning over tens of billions in revenue could still be losing money, with comments ranging from “How can a business with so much revenue still be losing money?” to more pointed queries about where the funds are being spent. A recurring theme was frustration over the cost of membership combined with the persistence of advertising, leading some users to compare iQIYI unfavorably with short‑form competitors like Douyin. Others highlighted the platform’s reliance on Baidu’s financial backing, suggesting that iQIYI’s survival may hinge more on its parent’s deep pockets than on its own profitability.

Amid the criticism, a number of observers pointed to brighter spots in the company’s performance. Non‑GAAP operating profit remained in the black, and the integration of artificial‑intelligence tools has reportedly lifted ad click‑through rates, offering a glimpse of how technology could help offset declining ad spend. Moreover, the robust cash cushion gives iQIYI room to experiment with new revenue models, whether that means revising subscription pricing, expanding tiered ad‑free options, or exploring alternative content formats.

In short, iQIYI’s Q2 loss underscores the intensifying competition and rising cost pressures confronting China’s online video market. While the platform’s vast user base and strong backing provide a buffer, the coming months will be decisive. Success will likely depend on the company’s ability to deliver compelling content that re‑engages subscribers, innovate its monetisation approach, and navigate an advertising landscape that remains cautious in uncertain economic times. The next set of releases could prove pivotal in turning the current tide and restoring confidence among both investors and viewers.