Youku Tudou (YOKU) predicts its content costs, long an investor concern, will decline as a % of revenue next year, as the Chinese online video market's content rates rationalize following last year's surge, and the company's merger gives it more purchasing power. Content costs made up 37% of Youku's Q2 revenue, up from 25% in the year-ago period. (previous)
European tech and telecom stocks carrying heavy debt loads are jumping today on optimism regarding the ECB's latest efforts to prop up Europe's bond markets. NOK +6.1%. ALU +4.5%. TI +7.8%. TEF +3.6%. Many Asian tech names are also posting solid gains, after the continent's stock markets rallied overnight in the wake of a new Chinese stimulus plan. YOKU +4.8%. SPRD +4.7%. SNE +3.6%.
Youku (YOKU -0.1%) and Tudou (TUDO) shareholders approve Youku's all-stock acquisition of Tudou in a deal that combines China's two biggest video Web sites and creates a company with over 300M weekly users. The transaction will increase Youku's lead over rivals Baidu (BIDU) and Tencent, and should generate savings of up to $60M/year.
Chinese Internet stocks are rallying, as pleasing earnings reports from Sina and messaging/gaming giant Tencent (TCEHY.PK) more than offset a miss from NetEase. BIDU +2.5%. SOHU +5.5%. GAME +4.9%. YOKU +5.9%. TUDO +5.5%. CYOU +2.1%. Tencent, which received a favorable WSJwrite-up ahead of earnings, rose 6.4% in Hong Kong after reporting revenue of $1.65B (+56% Y/Y) and net income of $487M.
Chinese Internet stocks surge in response to pleasing Q2 reports (I, II, III) from Youku (YOKU +7.6%), Sohu (SOHU +17%), and Changyou (CYOU +16.6%). BIDU +4.3%. SINA +9.7%. RENN +11.4%. PWRD +6.7%. TUDO +8%. Baidu's gains are coming in spite of the company's disclosure that 3 employees were arrested for taking bribes to delete message board posts.
Tudou (TUDO), which is set to merge with fellow Chinese video site Youku (YOKU), has reported Q2 revenue of $27.1M (+47.4% Y/Y) and EPS of -$0.80; the results miss consensus by $6.3M and $0.41. Nonetheless, Youku is up 4.8% - the Street seems pleased with its Q2 EPS beat and guidance for Q3 revenue growth of 70%-80% Y/Y, though the latter is below an 86.8% consensus. Youku had a short ratio of 6.4 as of July 13.
More on Baidu's Q2: 352K online ad customers, +9.7% Q/Q and +18.1% Y/Y. Revenue/customer was $2,440, +16.5% Q/Q and +34.8% Y/Y. Traffic acquisition costs were 8.3% of revenue, up from 7.8% in Q1 and 7.9% in year-ago period. SG&A expenses +55.6% Y/Y, R&D expenses +82.7%. BIDU +5.5% AH. Up in sympathy: SINA +2.8%. SOHU +2.5%. YOKU +1.7%. (PR)
Youku.com (YOKU +3.4%) and merger partner Tudou (TUDO +4.1%) are rallying after Youku receives positive comments from JPMorgan and OTR Global. JPM, which launched coverage on Monday, says the recent weakness in Youku shares, caused by the resignation of Tudou's COO, is overblown. OTR argues online video ad spending remains healthy.
Youku Tudou Inc is an Internet television company in china. Its internet television platform enables consumers to search, view and share high-quality video content quickly and easily across multiple devices.