Note: US$ rate is based on exchange rate at time of writing
Alibaba Films posted a loss in 2016, despite a significant jump in revenue.
In an earnings report released on March 30th, the company says that 2016 revenue was RMB904.6 million (US$131 million), marking a 246% year-on-year increase. However, the company also recorded a loss of RMB976.1 million (US$142 million), a major loss considering that the company recorded RMB466 million (US$67.6 million) in profit in the previous year.
The company attributes the loss to marketing expenses incurred by Tao Piao Piao, an internet ticketing platform that Alibaba acquired in 2015. Most of the aforementioned marketing expenses went to ticket subsidies, offering deep discounts to encourage movie-goers to sign up for its platform. The company’s internet-based promotion and distribution business generated RMB683 million (US$99.1 million) in revenue for the year, but it was offset by the marketing cost to make that happen.
The company’s film releases – Zhang Jiajia and Wong Kar-wai’s See You Tomorrow (擺渡人), Derek Tsang’s Soul Mate (七月與安生) and fantasy epic League of Gods (封神傳奇) – mostly performed below expectations, leading to a loss of RMB243 million (US$35.3 million) in the content production sector.
The company’s 2017 projects include period fantasy romance Once Upon a Time (三生三世十里桃花), romantic comedy Mr. Pride vs Miss Prejudice (傲嬌與偏見) and Vicki Zhao’s troubled second directorial effort 沒有別的愛. It also invested in Steven Spielberg’s Amblin Partners.