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Saturday, June 19, 2021

Why Lizhi Inc. (LIZI) is Popping high Right Now? Here is what you need to know

Lizhi Inc. (LIZI) is a leading online user-generated content audio community and interactive audio entertainment platform in China. Lizhi reported its unaudited fourth quarter and fiscal year 2020 financial results after which the LIZI stock price saw a jump of 14.37% to reach $7.80 a share as of this writing. The stock seemed red with a 6.19% drop at the previous closing but  Q4 earnings and fiscal year results of 2020 have made the momentum for the LIZI stock price to grow. Let’s deep dive to explore more of it.


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What’s happening?

Lizhi has shown exceptional growth in its quarterly and yearly revenue. The audio platform has recorded growth in its active users as more users are added to the company’s database in 2020  as compared to 2019. Here is the summary of Lizhi’s unaudited financial and fiscal year results of 2020

Fourth Quarter:

  • Net revenues surged by 15% to reach RMB420.3 million as compared to RMB365.3 million in the same quarter of the previous year. The company reported RMB361.5 million revenue in the previous quarter of 2020.
  • Average monthly active users in mobile totaled 58.4 million in the fourth quarter as compared to 51.9 million in the same quarter of the prior year.
  • The average total monthly paying users reached 422.4 thousand in the fourth quarter as compared to 434.1 thousand in the same tenure of the previous year.
  • Audio entertainment revenues were recorded at RMB414.7 million with a 15% rise as compared to RMB360.4 million in the same period of 2019.
  • Podcast, advertising, and other revenues were reached RMB5.5 million with a 12% rise from RMB4.9 million in the fourth quarter of 2019.
  • Cost of revenues increased by 11% to  RMB301.3 million in the fourth quarter of 2020 as compared to RMB300.8 million in the fourth quarter of last year.

Fiscal Year Results:

  • Net revenues surged by 27% to reach RMB1,502.9 million as compared to RMB1,180.6 million in the previous year.
  • Average monthly active users in mobile totaled 58.4 million in the fourth quarter as compared to 51.9 million in the same quarter of the prior year.
  • The average total mobile MAUs reached 56.2 million in 2020 as compared to 45.7 million in 2019.
  • The average total monthly paying users reached 446.1 thousand as compared to 351.7.1 thousand in the previous year.
  • Audio entertainment revenues were recorded at RMB1,481.1 million with a 27% rise as compared to RMB1,167.9 million of 2019.
  • Podcast, advertising, and other revenues were reached RMB21.8 million with a 72% rise from RMB12.7 million in 2019.
  • Cost of revenues increased by 25% to   RMB1,134.7million in the fourth quarter of 2020 as compared to RMB910.2 million in the previous year.

Conclusion:

Considering the bullish sentiment, things are favorable for LIZI stock. Lizhi Inc. has shown growth in its yearly revenue as well as monthly active users. The increase in the cost of revenue of Lizhi due to increased salaries and welfare benefits points to the growth of the company. In short LIZI stock can be a good bet for investors in the future.

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