A few months ago, it seemed online video site, Tudou was flying through a storm especially when it IPO’d in August and faced increasing pressure from Youku. Now it seems, the storm has settled and financially, things are improving for Tudou.

Tudou has just reported its Q3 2011 financial results. Here are the highlights:

The increase in net revenues is due to increased demand for online advertising services. The decline in gross profit was primarily due to the increase in Internet bandwidth costs and licensed content costs.

Registered users are now over 96 million.

“We are pleased to see growing demand for Tudou’s online video platform as evidenced by our healthy revenue growth,” said Gary Wang, Founder, Chairman and Chief Executive Officer of the Company.

What’s been happening?

In August, Tudou and LeTV entered into a revenue sharing arrangement, where LeTV’s content portfolio of over 680 TV episodes and 650 movies have begun to air on tudou.letv.com.

In October, Tudou entered into an agreement with The Walt Disney Company for the online distribution rights to the Pixar animation movie, Cars 2, in Mainland China. From recollection, Cars wasn’t a very popular movie. Toy Story would have been a better option in my opinion.

What’s next?

For Q4, the company expects year on year growth in net revenues of 55-60%.

Jason is an Australian born Chinese living in Beijing, specializing in entrepreneurship, start-ups and the investment eco-system in China, especially in the tech and social area.

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