iQIYI Faces a Bleak Forecast Amid Stagnant Growth
iQIYI’s latest quarterly earnings have once again underscored the company’s struggle to translate massive content libraries into profitable growth. The Chinese streaming giant reported a loss of $0.04 per share for the quarter ending September 30, 2025, a decline from the $0.030 loss posted a year earlier. While revenue reached $933.6 million—a modest increase versus the same period last year—the company remains trapped in a cycle of revenue expansion that fails to offset escalating costs.
A Price Target Plummeted by CFRA
On November 21, 2025, CFRA lowered its price target for iQIYI to $1.90 from a higher level, citing “weak outlooks” and the company’s inability to generate sustainable earnings. The analyst’s assessment comes at a time when iQIYI’s share price languishes near the $2.19 close, a mere $0.64 below the 52‑week high of $2.84. The downgrade signals a growing consensus that the platform’s content strategy and monetization model are insufficient to counterbalance intense competition from both domestic players—such as Tencent’s emerging short‑comic drama initiatives—and global streaming services.
AI‑Driven Content Expansion: A Mirage?
iQIYI announced on November 18 that it would accelerate its AI‑driven content creation pipeline and pursue global expansion, noting that overseas membership revenue had more than doubled. Yet the company’s fundamentals tell a different story. With a market capitalization of $2.16 billion and a price‑to‑earnings ratio of ‑34.39, iQIYI remains a high‑risk investment. Even if AI efficiencies reduce production costs, the current loss trajectory suggests that the company has yet to discover a scalable business model that can convert new subscribers into profitable revenue streams.
Market Sentiment Remains Tepid
Benchmark Capital’s decision on November 19 to maintain a “Hold” rating for iQIYI reflects the market’s ambivalence. The firm’s stock, which has slipped from the 52‑week high, shows no signs of a breakout, especially given the negative earnings per share and the recent downgrade by CFRA. Analysts are wary that iQIYI’s reliance on ad‑supported revenue and premium subscriptions may not be enough to offset the high costs of content acquisition and original production.
Competitive Pressure Intensifies
While iQIYI seeks to differentiate itself with AI‑generated content, its main competitors are not idle. Tencent, for instance, launched mini‑programs for short comic‑style dramas on the same day CFRA revised its target, signaling an aggressive push into niche formats that could siphon viewers away from iQIYI’s broader offerings. The Chinese market’s appetite for short‑form, highly curated content is growing, and iQIYI’s current strategy appears ill‑prepared to meet this shift.
Bottom Line: A Company on the Brink
The confluence of a declining earnings per share, a lowered price target, and a market that is neither bullish nor bearish paints a stark picture for iQIYI. Investors should note that the company’s valuation is heavily discounted by its negative earnings and that its recent attempts to harness AI and expand abroad have yet to produce tangible financial upside. Unless iQIYI can dramatically improve its monetization framework and secure a sustainable competitive moat, the company’s future growth prospects remain doubtful.
