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Shares of iQIYI (NASDAQ:IQ) stock have soared higher by over 25% today following news of the company’s expansion into Spanish-speaking regions. iQIYI operates as a content streaming provider and also provides a social media platform for users.
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After today’s gain, IQ stock is still down about 6% year-to-date (YTD). However, that return is roughly in-line with the S&P 500’s YTD return of 5.4% as of this writing.
With that in mind, let’s jump into the latest news surrounding this content provider. Here’s what investors should know about IQ stock.
Why Is IQ Stock Up Today?
Today, IQ stock is up on an announcement that the company will be introducing original Chinese content to Spanish-speaking regions. The original content — including names like Kidnapping Game and Crimson River — will be dubbed in Spanish and broadcasted to 11 different channels. These channels include Epic Network, Toku and Top Cine, among others.
So far, with an “increase in demand for modern dramas,” iQIYI has seen success in South Korea and Japan. The company believes it will see similar success in Spanish-speaking markets. Alice Leung, the company’s General Manager of International Distribution, had the following to say:
“iQIYI is dedicated to producing quality content that meets the diverse and ever-changing demands of our audience. Over the past few years, we are pleased to see the original series we released overseas generating much enthusiasm among local users […] Going forward, we will continue to introduce quality original C-content to the overseas market as we see a rising demand.”
Last year, the company received approval to release over 1,500 episodes of original Chinese content to overseas markets. In addition, iQIYI’s Love is Sweet show became “the first Chinese drama series to air” on South Korea’s TBS channel.
Could iQIYI Be Delisted?
Earlier this month, IQ stock hit a 52-week low of $1.86 on delisting and regulatory fears. However, it seem that China has since taken a defensive stance, walking back on harsh regulatory policies. The People’s Bank of China stated that it would “ensure stability in capital markets” and support overseas listings. As a result, Chinese stocks across the board have seen huge price appreciations this month.
Moving forward, China has also asked some U.S.-listed Chines companies to prepare for more U.S. audit disclosures. This was done to comply with the United States’ Holding Foreign Companies Accountable Act (HFCAA). Under the HFCAA, foreign companies can potentially be delisted from U.S. exchanges if they don’t provide U.S. auditors with the proper financial forms for three consecutive years.
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On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
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