Briefing: Meitu cuts smartphone segment amid gloomy financials

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美图2018年财报喜忧参半 互联网业务将“接棒”智能手机 – 21st Century Business Herald

What happened: Chinese selfie app maker Meitu has announced its annual results for the 12 months ended Dec. 31, 2018, reporting a net loss of over RMB 1.2 billion (around $179.6 million). The Xiamen-based company’s total revenue declined 37.8% to RMB 2.8 billion (around $419 million), which the company attributed primarily to a slower smartphone business. Meitu said that of its net loss, some RMB 0.5 billion was linked to its smartphone activities. The company said it expected to wind down that business line by the middle of this year. Last November, Meitu announced a partnership with Xiaomi, in which Xiaomi would represent all future Meitu branded smartphones other than the Meitu V7. That model was released at the end of 2018.

Why it’s important: Starting out as a beauty filter app maker, Meitu developed its first selfie smartphone called the Meitu Kiss in 2013. Since then, the company has released several smartphones that highlight selfie features. But the company only sold 3.5 million smartphones in the five years of its hardware business, according to an earlier announcement. After handing its smartphone business over to Xiaomi, Meitu will shift focus back to core activities and says it is committed to developing next-generation image technology and algorithms.