Zhihu posts strong Q2 revenue growth, huge boost in users

China's biggest online question-and-answer website, Zhihu, posted a revenue growth of 144 percent in the second quarter, thanks to a growing number of paid members and business diversification, the New York-listed firm said.

The Quora-like Zhihu, which started listing in New York in March, is establishing "a content-centric ecosystem and sustainable commercialization model," said Chairman and Chief Executive Zhou Yuan.

It posted a revenue of 638 million yuan (US$100 million) in the second quarter, a little higher than market expectations of 629 million yuan. Net loss expanded to 321 million yuan in the quarter, compared with 116.1 million yuan a year ago.

Zhihu is attracting users to pay for high-quality content, mainly in categories involving consumption, IT industry analysis and general sciences.

The business growth came from more paying members and the company's diversification strategy, which aims to cash in through various streams other than advertising.

Zhihu's monthly active user base grew to 94.3 million, of which 4.7 million were paid users – an increase of 121.1 percent year on year. The portion of paid users increased slightly to 5 percent, compared with 4.7 percent a year ago.

"We are optimizing content structure and refining our evaluation standards for quality content to enhance our unique position in the market," Zhou said in a statement.

Advertising income now accounts for 39 percent of the company's revenue, compared with 64 percent a year ago, Zhihu reported.

Video business in the second quarter expanded, with uploaded video volume tripling from a year ago.

However, industry insiders say the company faces competition from firms such as Bilibili and Douyin, both of which have strong video business in China.