Second quarter revenue will reach 970 million yuan, mainly by the lower non-advertising revenue impact

Pacific Crest, the US investment bank, today released an investment report to keep the Youku potato stock (Nyse:yoku) "Flat with the market" rating.

The following is a summary of the article content:

Less than we expected: in the first quarter of fiscal year 2014, Youku potato revenue was 112.7 million U.S. dollars, less than our expected 115.6 million dollars. But if the exchange rate factor is excluded, the revenue of RMB 700.4 million is in line with our expected 700 million yuan. Diluted by 0.22 dollars per share, and our expectation is that each share of diluted losses of 0.17 U.S. dollars, mainly affected by higher bandwidth costs. Affected by seasonal downturn, the number of advertisers dropped to 405. In the first quarter, mobile revenue contributed more than 1/3 of total revenue.

Second-quarter results lower than expected: Youku potatoes expect the second-quarter revenue to reach 970 million yuan, below our expected 980 million yuan, mainly influenced by lower ad revenue.

Revenue diversification: We believe that partnering with Alibaba (rolling information) will bring benefits to Youku potatoes, such as potential small to medium advertisers and data sharing. Youku potatoes are currently looking for revenue diversification, such as application publishing, film production, membership and the commercialization model based on the project.

Valuation: We continue to maintain the "flat" rating of the Youku Potato stock market.