How Huya, A China-Based Esports Platform, Went Public

Morning Report: Huya went public! What is Huya?

Good morning and happy Friday. Today we’re going to rewind and go over something I should have had us watching all along. Namely, the Huya IPO.

Huya is a video game video platform that claims, per its F-1, to be the “No. 1 and most active game live streaming platform in China.” It’s akin, in some ways, to Twitch here in the United States. Huya is a company wagered on the continued rise of esports and the more general phenomenon of watching video games as a regular pastime.¹

The company raised $536.6 million during its life, according to Crunchbase.

Huya priced its shares a $12, the top of its range. Per Investor’s Business Daily, the company raised $180 million through a sale of 15 million shares. In its first day of trading, Huya is up 33 percent, trading for $15.95 per share.

Thus Huya marks another Chinese company listing on American shores this year and another technology IPO enthusiastically welcomed by investors. (Bilibili and iQiyi, two Chinese tech shops, listed in America earlier in 2018.)

What do we think of the company? That it looks kinda ok, really. Revenue grew 174.2 percent in 2017 to $335.8 million. The firm managed to wring $39.2 million in gross profit from its top line over the same period. Sadly, $55.3 million in operating expenses before other incomes left the firm with a deficit of $12.5 million for the year.

The company’s loss fell by 84 percent during the same year that its revenue nearly tripled. That’s a ramp to profits, I’d say.

Oh, and the firm had nicely positive operating cash flow during 2017. Not bad.

1. If you don’t know the difference between Overwatch, League of Legends, Starcraft 2, and DOTA 2, you are pretty damn far behind.

From The Crunchbase Daily:

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