The layoffs of iQiyi may be the largest in history. According to reports, the proportion of layoffs is between 20% and 40%. At present, the layoff policy is still changing, and there is still uncertainty about the amount of layoff compensation. The layoffs of iQiyi may be the largest in history.
The layoffs of iQiyi may be the biggest in history. 11February1. According to the First Financial Report, iQiyi is currently laying off employees, and the proportion of layoffs is between 20% and 40%. Redundancy compensation shall be paid temporarily as "N+ 1". The Beijing News Shell Finance reporter learned from many sources that the layoffs of iQiyi involve multiple departments. In addition to the core drama series, variety show procurement and production departments, user product departments, short video lettering, intelligent hardware (VR), animation and games are all among the layoffs, and public departments such as the market also have layoffs.
"Older employees are greatly affected," a former employee of iQiyi told Shell Finance. "It's time to lay off employees. There are too many of them, with seven or eight thousand people, nearly twice as many as similar companies in the industry, "an industry insider told Guoke Finance reporter.
In response to the above problems, the Beijing News Shell Finance reporter has repeatedly asked iQiyi for verification, and has not received a response as of press time.
Last month, Gong Yu, founder, director and CEO of iQiyi, revealed the layoffs. At the conference call of analysts of the third quarterly report of iQiyi held on the evening of 10/17, Gong Yu said that the focus of iQiyi is to open up sources and cut down expenses, mainly to cut down inefficient businesses and projects, and to increase and try new monetization opportunities.
The financial report shows that in the third quarter of 20021,the total revenue of iqiyi reached 7.6 billion yuan (RMB, the same below), up 6% year-on-year; The net loss attributable to iQiyi was 654.38+07 billion yuan, compared with 654.38+02 billion yuan in the same period last year.
The epidemic affected the advertising and content supply of iQiyi. Member advertising, online advertising services, content distribution and others are the four main businesses of iQiyi: in the third quarter, iQiyi's membership service income was 4.3 billion yuan, an increase of 8% over the same period in 2020; The revenue of online advertising service was 654.38+07 billion yuan, down 654.38+00% compared with the same period in 2020, mainly due to the lack of high-quality content launched this quarter and the challenging macroeconomic environment. Content distribution revenue was 630 million yuan, an increase of 60% over the same period in 2020; Other income 1 100 million yuan, an increase of 3% over the same period in 2020.
Gong Yu said in the above conference call that the main challenge facing the industry at present is the shortage of content supply. "The epidemic is the most direct cause. For example, so far, the online volume of movies is less than half that of the same period last year, and the online volume of TV dramas is less than one-third of that of the same period last year. The new network drama can't go online because of audit reasons, and the quality after going online has also been discounted, which is only part of it. There has been a big problem in the supply of content. " Gong Yu said that he also agrees that the objective competition of short videos for users' duration is an important reason why the industry is facing challenges.
While the growth is affected, the cost of iQiyi is also rising. The revenue cost of iQiyi in the third quarter was 7 billion yuan, an increase of 65,438+00% compared with the same period in 2020. The increase in revenue cost is mainly due to the increase in content cost this quarter. As an important part of revenue cost, content cost is 5.3 billion yuan, an increase of 65,438+03% compared with the same period in 2020; Sales, general affairs and management expenses are1200 million yuan, down 9% compared with the same period in 2020; R&D expenditure was 683 million yuan, an increase of 2% over the same period in 2020. To sum up, the operating loss of iQiyi in the third quarter was 654.38+04 billion yuan, compared with 654.38+02 billion yuan in the same period in 2020, and the operating loss rate was 654.38+08%.
At the industry level, long video platforms such as iQiyi, Tencent Video, Youku, and Didi have not yet achieved profitability. As the growth rate of video platform members and revenue scale slows down, the capital market pays more attention to when long videos can achieve profitability.
Regarding this issue, Gong Yu said at the above analyst meeting, "This will take time, but it is not far from this stage, because iQiyi has accumulated more and more IP." "Eat one more fish" that iQiyi often says is to develop IP into different forms from content and production. For example, what used to be novels has now become TV series, movies, animations and games. Then authorize IP commercialization and turn it into stationery and props. When these comprehensive incomes include advertising income, membership fee income directly extracted from users, and single-chip on-demand income, this business model is established. , more than the investment in content.
The layoffs of iQiyi may be the largest in history. Iqiyi is laying off employees, and the proportion of layoffs is between 20% and 40%.
According to the report, the current layoff policy is still changing, and there is still uncertainty about how much layoff compensation to pay. As of press time, iQiyi has not responded to this matter.
Under the dynamic news about the layoffs of iQiyi, a large number of short video platform employees started the "fishing for people" mode-"Are there any friends interested in Tik Tok?" "We are doing live broadcast in Tik Tok here, and we started to do live broadcast last year. This is a new business project, but DAU and its daily revenue are several hundred million, ranking first in the industry, and its business is still growing at a high speed." "Tik Tok Music currently has a large number of HC (recruitment places), including servers, clients and front ends."
Based on the news of many insiders, the specific situation of iQiyi's layoffs is:
1, layoffs are to speed up the pace of profitability, focus on content and technology, fine cost management, and flatten the structure. Therefore, in this layoff, the middle level (director level) was laid off more.
2. Iqiyi's budget is shrinking, and the departments that mainly spend money, such as marketing, distribution, channel cooperation, etc. There are more than 30% layoffs, and the most can reach 50%. Employees who have not passed the probation period are among the layoffs. Almost all departments have been laid off, and short video products will be merged with other products, and only 40% can stay. The laid-off employees will receive compensation of N+ 1
3. Independent Iqiyi Intelligence (with VR and other products) also has the proportion of layoffs, but it is relatively low compared with the expenditure department. The proportion of layoffs in the content department is around 30%, and many studios are gone. The principle is that only low-cost employees stay in the same position.
4. Many old employees call this layoff "the biggest layoff in the history of iQiyi", and this round of layoffs is not over yet. Many people will be laid off before and after the Spring Festival.
The financial report shows that:
The number of employees decreased last year 1 168.
The financial report released by iQiyi recently shows that in the third quarter of 20021,the revenue was 7.589 billion yuan and the net loss was170.7 billion yuan. As of the close of 1 1.30 EDT, the share price of iqiyi fell by 2. 19% to 6.24 USD/share, with a total market value of 4.925 billion USD, which has fallen by more than 80% compared with the peak in May 20 18.
Last year, iQiyi lost 6 billion RMB for the whole year. According to this year's latest third-quarter financial report, iQiyi's total revenue in this quarter was 7.589 billion yuan, up 5.59% year-on-year, and its net profit returned to its mother was 65.438+07 billion yuan, up 465.438+0.6% year-on-year. The revenue cost was 7.028 billion yuan, of which the content cost expenditure was 5.3 billion yuan, a year-on-year increase of 65,438+03%. This part of the growth mainly comes from increasing investment in original content.
According to the data of the annual report, the number of employees of iQiyi was 4794, 60 14, 8577, 8889 and 20 18, 20 19 at the end of 2020, respectively. It can be seen that before 20 19 years ago, the number of employees of iqiyi showed an increasing trend, but in 2020, the number of employees decreased by 1 168, a decrease of about 13. 14%.
Short videos are booming.
Squeezed the advertising revenue space of iQiyi.
The vigorous development of short videos has squeezed the advertising revenue space of iQiyi in the last two years. Judging from the market scale, user scale, usage duration and other data, short video has occupied a dominant position in the dispute between long and short videos.
The Research Report on the Development of Network Audiovisual in 2020 shows that in the second half of 20 18, the average daily usage time of short video applications has surpassed that of long videos, making it the first in the field of network audiovisual applications. QuestMobile data shows that in the first half of 20021,advertising revenue of typical Internet media accounted for 42.2% of short video advertising revenue such as Tik Tok, 30% for Tik Tok alone, 2.6% for long video platform advertising revenue, and only 4.5% for iQiyi.
Gong Yu, founder and CEO of Aiqiyi, said earlier that the biggest problem that the long video industry is currently facing is the serious shortage of content supply in terms of supply and demand. The new network drama has been delayed because of the audit, and the quality of the online drama has been discounted ... the supply of content is very problematic; The objective reason is the competition between short videos and users' duration.
In the case that the copyright fees of film and television dramas are too high and the new profit scene has not yet been opened, the long video platform with both traffic and revenue losses has indeed entered a difficult and dark moment. Layoffs may be the simplest way to reduce the burden.
In order to solve the problem of "lack of high-quality content", Gong Yu mentioned the future plan: there will be a large number of film and animation studios in the next two years. At the same time, with more and more internal studios, iQiyi will continue to adhere to the development of multi-content categories and deepen the vertical track such as "Fog Theater".
The layoffs of iQiyi may be the largest in history. Iqiyi has already taken this step.
65438+February 1 According to Sina Technology, on the same day, iQiyi began a round of mass layoffs. A number of laid-off employees said that the layoffs were the largest round of layoffs in the history of iQiyi. Almost all departments were laid off, and even profitable departments such as content and intelligent hardware had indicators.
According to reports, iQiyi's layoffs are aimed at accelerating the pace of profitability, focusing on content and technology, refining cost management and flattening the structure. Therefore, there are many middle-level (director-level) employees who have been laid off, and there are also employees who are older, older and have higher wages. Most of them have been laid off.
At the same time, the budget of iQiyi has shrunk, mainly in the departments that spend money, such as marketing, distribution and channel cooperation. All of them have laid off more than 30%, and the most can reach 50%. Almost all employees who have not passed the probation period are among the layoffs. Almost all departments such as iQiyi Research Institute and iQiyi Game Center have laid off employees, and only 40% of short video products can stay with the combination of lettering and other products. The laid-off employees will be compensated by N+ 1, and they can leave after the handover. However, employees with long service life and middle-level employees can stay until the end of the month.
Independence. Iqiyi Smart (with VR and other products) also has a layoff ratio, but it is relatively low compared with the expenditure department. The proportion of layoffs in the content department is around 30%, and many studios are gone. The principle is that only low-cost employees stay in the same position.
2 1 Century Business Herald When the reporter asked iQiyi for the authenticity of the above news, the relevant person in charge said that he would not respond to it.
According to 2 1 Century Business Herald, the reporter learned from many Internet platform people including iQiyi, Tencent Video and Ali Digital Entertainment that the overall salary of iQiyi is not dominant. Moreover, because the long video has not found a profit model, the income of the whole industry is low in the Internet ecology.
Irretrievable loss
Behind the layoffs is the expansion of the net loss of iQiyi.
According to the third quarterly report, the revenue of iQiyi in this period was RMB 7.6 billion (about US$ 65.438+RMB 200 million), a year-on-year increase of 6%; The net loss was 654.38+07 billion yuan (about 268.4 million US dollars), compared with 654.38+02 billion yuan in the same period last year.
The reason comes from weak growth.
In this issue, the service income of iQiyi members was 4.3 billion yuan, an increase of 8% year-on-year; The online advertising service revenue was 654.38+07 billion yuan, down 654.38+00% year-on-year; The revenue from content distribution was 627,654.38 billion yuan, a year-on-year increase of 60%; Other income was 654.38 billion yuan, a year-on-year increase of 3%.
As the biggest income source of membership business, the opposite of growth is the decline in the number of users, and it has won an 8% growth rate by raising prices. By the end of the third quarter, the number of subscribed members of iQiyi had reached 654.38+36 million. In the same period last year, this figure was 65.438+0.48 billion.
At the end of last year, iQiyi launched a new membership pricing scheme. After the price adjustment, the multi-terminal price is unified, and * * * is divided into six grades. The prices of continuous monthly rent, monthly card, continuous quarterly rent, seasonal card, continuous annual rent and annual card are 19 yuan, 25 yuan, 58 yuan, 68 yuan, 2 18 yuan and 248 yuan respectively.
Objectively, the actual increase in this price is limited. In the past, the price paid by video members through iOS was generally higher than that paid through Android /PC. This time, the price of iQiyi was adjusted to multi-terminal unified pricing. Comparing the prices before and after the price increase, the iOS end is basically flat, and the membership fee of Android /PC end has increased by about 25%.
However, the small number of members makes it difficult to support long-term income growth.
In the advertising business of iQiyi, the income is still declining.
This has a lot of environmental factors. According to the data released by the National Bureau of Statistics, the total retail sales of consumer goods in August increased by 2.5% year-on-year, with the previous value of 8.5%, and the growth rate slowed down significantly. The consumption data in August was significantly lower than expected.
At the same time, the industry where important advertisers are located continues to fluctuate. Take Tencent as an example, the slowdown in advertising growth is mainly due to the weak advertising demand in education, insurance and game industries and the rectification of Internet advertising.
Baidu also said that in advertising business, real estate, decoration, education, tourism and other industries have been negatively affected. At present, education, real estate and other industries are the key regulatory targets, while tourism is deeply affected by the epidemic.
"The more cautious, the better, and must look at the rate of return. There is a lot of pressure. " An executive of a Fortune 500 beverage company told 2 1 Century Business Herald.
Iqiyi also faces a special industry background.
"The decline in the number of members is due to the lack of content. Because of the epidemic, cinema movies are not on the cinema, so they can't get cinema movies. The second is that the TV series was affected by the epidemic and the audit, and the broadcast was postponed. Third, variety shows are affected by advertisers stopping advertising and sponsorship, which also leads to delays. There are also some other influences, such as animation and so on. These are the main reasons for the decline in the number of users and members. " Gong Yu, founder and CEO of iQiyi, said at the beginning of the year.
In addition, the cost control of iQiyi is limited. The revenue cost in the third quarter was 7 billion yuan, up 65,438+00% year-on-year. The content cost was 5.3 billion yuan, up 13% year-on-year.
As a result, iQiyi has fallen into a reverse cycle of unsuccessful profit model and rising costs, and layoffs have become a necessary topic.
The effect of layoffs is limited. Is it important to rectify discipline?
The fundamental problem has not been solved. Can layoffs effectively reduce costs?
At present, it can only be partially alleviated. According to the third quarterly report, iQiyi's R&D expenditure was 683 million yuan, up 2% year-on-year, and employees' income was mainly reflected in this category.
This is less than half of iQiyi's loss of 65.438+07 billion yuan. After all, there is limited room for layoffs.
According to media reports, iQiyi will reduce the market budget, and this actual effect may be relatively large. Iqiyi's sales, general affairs and management expenses in the third quarter were 654.38+02 billion yuan, a year-on-year increase of 9%.
For iQiyi, the practical significance of layoffs may lie in cleaning up discipline, thus saving costs in structure. For video platforms, most of employees' income comes from gray income.
People including Iqiyi, Tencent and Ali all admitted to the 2 1 Century Business Herald that there is room for kickbacks in the company's projects. This is more obvious in the non-standard film and television industry.
Recently, in an anti-fraud investigation, Tencent found that Alina Zhang, the producer of Tencent's video and film projects, violated the company's "high-voltage line" and was suspected of breaking the law. It has been handed over to the judicial organs for handling. Alina Zhang works in Tian Peng Studio under Tencent Video.
Last year, criminal judgment, the first trial of Yan Tao's bribery case, was published by Judgment Document Network. On June 24th, Ren, the former editor-in-chief of Zhejiang Satellite TV, was sentenced to five years' imprisonment in the first instance for illegally accepting 4.88 million yuan of investment in TV dramas.
20 18 12, Yang Weidong, former president of Ali Entertainment Youku and CEO of Ali Music, was investigated by the police for economic problems. The verdict shows that during his tenure as president of Youku, Yang Weidong took advantage of his position to illegally accept bribes totaling RMB 8.55 million to seek benefits for others, which constituted the crime of accepting bribes by non-state staff.
In August of 20 13, Liu Chunning, former general manager of Tencent's network video department, left his post and joined Ali. 20 14 During the internal audit of Tencent, it was found that the video team headed by Liu Chunning was suspected of corruption, so it struck hard.
2065438+In April 2006, Liu Chunning was accused of accepting bribes and heard in the Nanshan District People's Court in Shenzhen. According to Caixin's report at that time, the two criminal facts that Liu Chunning was accused of occurred during his tenure as the general manager of Tencent's network video department. The first accusation was that he was suspected of interfering with the ratings of the TV series "Young Heroes" and took bribes of 6.5438+0.43 million yuan.
The second alleged criminal fact accused by the prosecution is that Liu Chunning took bribes of 700,000 yuan when buying two dramas, Baby and Warrior Lan Ling.
"This industry is too market-oriented. Starting from grabbing IP, grabbing stars and other projects in the early stage, it is full of variables and moisture. The cost of the shooting stage is also opaque, and the price in the later stage is even more foggy. It is not clear whether the market price is still feasible. It is originally two sides of a body, and water is sometimes a necessary living condition. " Some executives of listed film and television companies admitted to the reporter of 2 1 Century Business Herald.
Under the pressure of operation, it may also be helpful to clean the iQiyi system by cutting middle-level and old employees.
"We often say that one fish eats more than one fish: the investment in content has produced IP related to content, and then IP has been developed into different works, such as novels, and now it has become movies, dramas, animations and games. Later, the authorization of IP commercialization was turned into comprehensive income such as stationery and props, including advertising income and membership fees or single-chip on-demand fees charged directly to users. Only these combined revenues exceed the investment in content, this kind of business. This takes time, and iQiyi is not far from this day, because we have accumulated more and more IP. " Gong Yu made a statement on the earnings conference call.
This is his rare direct call.