Huawei, meanwhile, has been banned from importing components from American companies as a result of the Trump administration’s concerns that the company may hand over US telecom user data to the Chinese government.Ĭompany founder and CEO Fu Sheng said during the call on Tuesday evening that its sinking revenue was due to a dropoff in online advertising income from its utility apps, which accounted for 80.4% of its total revenue in the quarter. Beijing-based Bytedance’s popular short video app TikTok is struggling to assuage US lawmakers’ growing scrutiny over its content moderation policies and data security practices. Cheetah, whose at least sloppy and allegedly fraudulent advertising and data collection practices have been criticized at length by Buzzfeed, faces a context in which such allegations are hard to ignore.ĭata security is increasingly critical to Chinese tech companies that target users in the US. The end of its relationships with US tech companies comes as they’re under increasing pressure to reassure their users about security. Per Bjorke, Google’s senior product manager for ad traffic quality, told BuzzFeed News in a February interview that the apps removed were “mainly from developers based in China, Hong Kong, Singapore, and India.”Ĭheetah said it generated around 22.6% of its total revenue from Google in the first nine months of 2019 and that the removal would “adversely affect” its ability to attract new users and generate revenue from Google platforms. Google said its reason for removing Cheetah Mobile apps, along with hundreds of apps from other developers, was that they displayed “disruptive ads” some of which were full-screen ads that covered the interface of their host apps. Though Q4 results do not include the impact from the removals, company CFO Thomas Ren warned that the removals were “a bigger threat to the company than the coronavirus outbreak” during the earnings call. In February, all of Cheetah Mobile’s apps and mobile games were removed from the Google Play store. Changing political contexts have sharply reduced the tolerance of US partners like Facebook and Google for small companies with mixed reputations. What went wrong? The truth is that Cheetah has faced serious questions about data collection and ad practices for years, but until recently privacy and security questions haven’t been a serious threat to companies like Cheetah. The NYSE-listed company has seen its share price drop 43% since the start of the year, and its market cap has shrunk by nearly 94% from a historical high of $4.8 billion in May 2015. The company booked a net loss of RMB 821.2 million in the fourth quarter, compared with net income of RMB 733.3 million in the same period a year ago.
The company’s apps were removed from Google’s store in February as part of a purge of apps identified as malicious by Google, Android’s parent company, company executives said on a Tuesday earnings call.Ĭheetah reported on Tuesday that its fourth-quarter revenue fell 55.7% year on year to RMB 612 million (about $86 million), and warned that the worst was yet to come.
The company has been cut off from major mobile ad platforms, including Facebook. Today, it’s a wounded gazelle, battling for survival. Backed by investments from Tencent and Bytedance, its utility apps for Android-including Clean Master, a browser, and a popular keyboard-were some of the most downloaded apps ever on Google’s Play Store.
A few years ago, Chinese app developer Cheetah Mobile was a solid, medium-sized software company with a global user base.