iQiyi's share drops on its first trading day in Nasdaq

iQiyi, dubbed as China's Netflix with Baidu Inc as a major shareholder, had its shares drop 13.6 percent to close at US$15.5 on its first trading day in Nasdaq.

The online video firm raised US$2.2 billion from its initial public offering, which is expected to boost development and competition in the domestic market.

iQiyi’s Chief Executive Gong You said he was not concerned about “short-term volatility” in the stock market. Gong, 50, called iQiyi business a “long-term running.” 

Founded in 2010, iQiyi now has 60 million paid users with a revenue of 17.3 billion yuan (US$2.67 billion) in 2017, up 54.6 percent year on year.

China's top three online video firms include Baidu-invested iQiyi, Alibaba-invested Youku Tudou and Tencent’s online video business, which are supported by top three Internet firms Baidu, Alibaba and Tencent, also known as BAT. 

Online video services, covering film, drama, talk show and broadcasting programs, are darling of investors due to their growth potential during China's new round of consumption upgrade.

Some iQiyi’s dramas have been distributed overseas through Netflix channel.