Shares of Chinese internet companies dropped in early Hong Kong trade, extending the sector’s heavy losses on Wall Street overnight.
Video-streaming platform Bilibili Inc.
led the selloff, with an 11% slump after the company on Thursday evening posted worse-than-expected earnings for the first quarter. Its U.S.-traded stock
plunged 15% in New York.
While the tech sector was broadly lower, with the Hang Seng TECH Index falling 1.2%, losses were concentrated in companies that rely heavily on online advertising operations, including Baidu and Kuaishou.
In the first quarter, Bilibili’s advertising revenue particularly weakened compared to its other businesses, as clients cut marketing budgets amid China’s pandemic resurgence, Shanghai’s lockdown and muted consumption sentiment.
Revenue at Bilibili’s advertising business rose 46% in the first quarter, marking a sharp slowdown from its doubling growth momentum in 2021.