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Qudian's new project is out of the way and the traditional main business doesn't operate well, either.

Qudian (Chinese: 趣店, NYSE: QD) announced its unaudited financial results for the second quarter of 2022 on Sept. 7. The financial results show that in the second quarter of this year, Qudian's total revenue was CNY 105 million, down 74.4% compared to CNY 412.1 million in the same period last year; net loss attributable to Qudian shareholders was CNY 61.3 million, or a diluted net loss of CNY 0.25 per American Depositary Share (ADS); GAAP net income attributable to shareholders was CNY 52.8 million, down 81% from last year. In the second quarter, sales revenue and other income decreased to CNY 8.8 million; financing revenue reached CNY 66.2 million, down 78.8% year over year; loan facilitation revenue and other related income decreased 47.6% to CNY 6.6 million; and transaction service fees and other related income decreased to CNY 6.5 million.

Less than two months after its high-profile foray into pre-made dishes, Qudian announced that it was streamlining the program and taking a series of initiatives such as laying off employees, terminating supplier partnerships, and clearing inventory to cut back on investment across the board. As a result of the pre-made dish program, Qudian’s costs and marketing expenses rose sharply, with total operating costs rising 53% to CNY 136 million and sales and marketing expenses rising 83% to CNY 53.2 million. With the new project out of the way and the traditional main business not looking good, currently, Qudian can only rely entirely on short-term investments to replenish its cash.

Due to the shrinking business after the IPO and several failed cross-border transformations lowering the stock price, Qudian even received a delisting risk warning from NYSE twice for its stock price being below USD 1 for a long time. On August 2, the company announced that it had regained compliance with the minimum requirements and resumed normal trading in the U.S. stock market.

As a result of the financial report, with a market cap of USD 213 million, Qudian's share price opened in a stepped-down pattern, with a maximum drop of 12% to close at USD 0.83 apiece, down 11%.

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