Based on the DuPont analysis method under the IQIYI Study on Profitability Issues

Abstract

With the improvement of material conditions and the increasing popularity of the Internet, video websites have become an important pastime for people. At present, most domestic video websites are losing money, and the research subject of this paper, Iqiyi, as a comprehensive reflection of a platform's operational efficiency, its profitability is the key to its survival and development. After years of development, video websites have formed three different profit models: "advertising revenue", "membership payment", and "IP industry chain”. However, the current problems facing the profitability of domestic video websites are: high cost, shortage of capital, frequent piracy infringement, and homogenization of content. This dissertation takes literature method and DuPont analysis as the research object, and explains the background, purpose and significance of the research. The main contents of the article include Dupont analysis, profitability factors, etc. Secondly, based on a comprehensive understanding of relevant literature and theories, this paper takes Iqiyi as the theme and provides an in-depth analysis of various profitability factors of Iqiyi from the perspective of profitability model; it finds the main problems under the current profitability model: uneven profit sources and consecutive years of losses. The main causes of these problems are: narrow profit target range, high costs and expenses, and decreasing number of member users. Finally, based on the analysis of this paper, suggestions are given to improve Iqiyi's profitability.