Xunlei Reports Q2 Non-GAAP EPS of $0.13, Revenue of $104M; Initiates Q3 Outlook

Xunlei reported Q2 Non-GAAP EPS of $0.13 and revenue of $104M, a 30.6% YoY increase. Subscription revenues rose 10.5% to $36.4M, while live-streaming and other services revenue surged 85.5% to $37.6M. The company initiated a Q3 outlook.

Xunlei Limited (NASDAQ: XNET), a leading technology company providing distributed cloud services in China, reported its Q2 2025 financial results, showcasing robust growth and significant achievements. The company's Q2 Non-GAAP EPS was $0.13, with total revenues reaching $104.0 million, representing a 30.6% year-over-year (YoY) increase [1][2].

Key highlights include subscription revenues rising 10.5% to $36.4 million, live-streaming and other services revenues surging 85.5% to $37.6 million, and cloud computing revenues increasing 13.6% to $30.0 million. The quarter was marked by three significant milestones: the successful acquisition of Hupu, the IPO of investee company Arashi Vision, and substantial revenue growth [2].

Notably, Xunlei recorded unrealized pre-tax gains of $720 million from its investment in Arashi Vision following its June IPO, contributing to a dramatic increase in net income to $727.4 million compared to $2.5 million in Q2 2024. The company's subscriber base expanded to 6.40 million from 5.71 million a year earlier, with average revenue per subscriber also increasing [2].

For Q3 2025, Xunlei projects revenues between $116 million and $124 million, representing a 15.4% quarter-over-quarter (QoQ) increase at the midpoint. This growth is expected to be driven by the successful acquisition of Hupu, which should continue diversifying revenue streams, particularly bolstering advertising income [2].

Despite the impressive revenue growth, operating margins remain slim with operating income of just $1.1 million. The cost structure shows some concerning trends, with gross profit increasing 25.9% to $51.2 million, but gross margin declining from 51.1% to 49.3%. Sales and marketing expenses nearly doubled to $21.6 million, representing 20.8% of revenue compared to 13.7% a year ago, indicating significant spending on user acquisition [2].

The successful acquisition of Hupu and the IPO of Arashi Vision have significantly strengthened Xunlei's financial position, with cash and short-term investments now at $275.6 million. The company's Q2 2025 results demonstrate remarkable growth across all business segments, with total revenue reaching $104.0 million, up 30.6% year-over-year [2].

References:
[1] https://seekingalpha.com/news/4485178-xunlei-non-gaap-epads-of-013-revenue-of-104m-initiates-q3-outlook
[2] https://www.stocktitan.net/news/XNET/xunlei-announces-unaudited-financial-results-for-the-second-quarter-7e57dvq009xd.html