ChinaNet's Stock Tumbles Despite Narrowed Net Loss
Shares in ChinaNet Online Holdings Inc. (Nasdaq: CNET) tumbled nearly 6 percent, to $1.40 apiece, on Tuesday after the company reported diminished revenue for the second quarter.
The Beijing-based company, which provides online advertising services, marketing and data analysis, said its revenue in the three months through June reached $15.5 million, down 31 percent year-over-year. Net loss was $400,000, or 2 cents per share, compared with $9.5 million, or 60 cents per share, a year ago.
ChinaNet attributed the results primarily to the decrease in revenues affiliated with distribution of search engine marketing for key search engines in the second quarter.
The company also confirmed closing a private placement with certain investors. ChinaNet said it issued 3,216,860 shares of common stock for $4.8 million under the deal.
"Our previously announced private placement agreement with strategic investors will help to shore up our capital position going forward and provide us with future growth opportunities," Handong Cheng, the chairman, president and chief executive officer of the company said in a statement on Tuesday.
He also said, "We are excited to explore the synergies between both parties' resources and optimistic regarding our potential to grow new, profitable lines of businesses."
Last month, ChinaNet announced Mark Li would assume the duties as the chief financial officer, after Zhige Zhang, the company's previous CFO, resigned for personal reasons.
Looking forward, the company said it will continue to integrate blockchain and AI technology with its products services for advertising, marketing and data analytics.
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