Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2020shares | |
Entity Addresses [Line Items] | |
Document Type | 20-F |
Document Period End Date | Dec. 31, 2020 |
Entity Central Index Key | 0001510593 |
Entity Registrant Name | Xunlei Ltd |
Current Fiscal Year End Date | --12-31 |
Entity Well-known Seasoned Issuer | No |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Accelerated Filer |
Entity Common Stock, Shares Outstanding | 334,401,981 |
Entity Shell Company | false |
Entity Emerging Growth Company | false |
Document Fiscal Year Focus | 2020 |
Document Fiscal Period Focus | FY |
Amendment Flag | false |
Document Registration Statement | false |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company Report | false |
Entity File Number | 001-35224 |
Entity Address, Address Line One | 21-23/F, Block B, Building No. 12 |
Entity Address, Address Line Two | No.18 Shenzhen Bay ECO-Technology Park |
Entity Address, Address Line Three | Keji South Road, Yuehai Street |
Entity Address, City or Town | Shenzhen |
Entity Address, Postal Zip Code | 518057 |
Entity Address, Country | CN |
Entity Incorporation, State or Country Code | E9 |
Document Accounting Standard | U.S. GAAP |
ICFR Auditor Attestation Flag | true |
Business Contact [Member] | |
Entity Addresses [Line Items] | |
Contact Personnel Name | Naijiang (Eric) Zhou |
Entity Address, Address Line One | 21-23/F, Block B, Building No. 12 |
Entity Address, Address Line Two | No.18 Shenzhen Bay ECO-Technology Park |
Entity Address, Address Line Three | Keji South Road, Yuehai Street |
Entity Address, City or Town | Shenzhen |
Entity Address, Postal Zip Code | 518057 |
Entity Address, Country | CN |
City Area Code | +86-755 |
Local Phone Number | 8633-8443 |
Contact Personnel Email Address | zhounaijiang@xunlei.com |
ADR | |
Entity Addresses [Line Items] | |
Trading Symbol | XNET |
Title of 12(b) Security | American depositary shares, |
Security Exchange Name | NASDAQ |
Common shares | |
Entity Addresses [Line Items] | |
Title of 12(b) Security | Common shares, par value US$0.00025 per share |
Security Exchange Name | NASDAQ |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 137,248 | $ 162,465 |
Short-term investments | 117,821 | 102,847 |
Accounts receivable, net (Allowance for credit losses of USD7,604 and USD9,329 as of December 31, 2019 and 2020, respectively) | 22,983 | 27,533 |
Inventories | 1,726 | 5,537 |
Due from related parties | 10,970 | 1,658 |
Prepayments and other current assets (Allowance for credit losses of USD5,503 and USD10,283 as of December 31, 2019 and 2020, respectively) | 11,534 | 16,543 |
Total current assets | 302,282 | 316,583 |
Non-current assets: | ||
Restricted cash | 1,541 | 2,983 |
Long-term investments | 26,734 | 26,365 |
Deferred tax assets | 1,118 | |
Property and equipment, net | 50,725 | 38,770 |
Right-of-use assets | 1,954 | 8,747 |
Intangible assets, net | 8,857 | 9,426 |
Goodwill | 22,607 | 20,382 |
Other long-term prepayments and non-current assets | 905 | 313 |
Total assets | 415,605 | 424,687 |
Current liabilities: | ||
Accounts payable (including accounts payable of the consolidated variable interest entities ("VIE") and its subsidiaries without recourse to the Company of USD 23,865 and USD 20,588 as of December 31, 2019 and 2020, respectively) | 20,644 | 24,213 |
Due to related parties (including due to related parties of the consolidated VIE and its subsidiaries without recourse to the Company of USD 2 and USD 55 as of December 31, 2019 and 2020, respectively) | 5,389 | 5,002 |
Contract liabilities and deferred income, current portion (including contract liabilities and deferred income, current portion of the consolidated VIE and its subsidiaries without recourse to the Company of USD 31,988 and USD 34,040 as of December 31, 2019 and 2020, respectively) | 34,040 | 31,988 |
Income tax payable (including income tax payable of the consolidated VIE and its subsidiaries without recourse to the Company of USD 2,436 and USD 2,500 as of December 31, 2019 and 2020, respectively) | 2,553 | 2,550 |
Accrued liabilities and other payables (including accrued liabilities and other payables of the consolidated VIE and its subsidiaries without recourse to the Company of USD 38,502 and USD 33,361 as of December 31, 2019 and 2020, respectively) | 38,689 | 42,840 |
Lease liabilities, current portion (including lease liabilities, current portion of the consolidated VIE and its subsidiaries without recourse to the Company of USD 4,621 and USD 1,912 as of December 31, 2019 and 2020, respectively) | 1,961 | 4,693 |
Total current liabilities | 103,276 | 111,286 |
Non-current liabilities: | ||
Contract liabilities and deferred income, non current portion (including contract liabilities and deferred income, non-current portion of the consolidated VIE and its subsidiaries without recourse to the Company of USD 1,223 and USD 920 as of December 31, 2019 and 2020, respectively) | 920 | 1,223 |
Deferred tax liabilities (including deferred tax liabilities of the consolidated VIE and its subsidiaries without recourse to the Company of USD 1,1 79 and USD 1,085 as of December 31, 2019 and 2020, respectively) | 1,085 | 1,179 |
Bank borrowings (including bank borrowing of the consolidated VIE and its subsidiaries without recourse to the Company of USD 11,324 and USD 19,924 as of December 31, 2019 and 2020, respectively) | 19,924 | 11,324 |
Lease liabilities, non-current portion (including lease liabilities, non-current portion of the consolidated VIE and its subsidiaries without recourse to the Company of USD 4,073 and USD 27 as of December 31, 2019 and 2020, respectively) | 27 | 4,132 |
Total liabilities | 125,232 | 129,144 |
Commitments and contingencies | ||
Equity | ||
Common shares (368,877,205 shares issued and 339,165,241 shares outstanding as of December 31, 2019; 368,877,205 shares issued and 334,401,981 shares outstanding as of December 31, 2020) | 84 | 85 |
Additional paid-in-capital | 469,887 | 472,052 |
Accumulated other comprehensive loss | (2,144) | (13,425) |
Statutory reserves | 5,414 | 5,132 |
Treasury shares (29,711,964 shares and 34,475,224 shares as of December 31, 2019 and 2020, respectively) | 8 | 7 |
Accumulated deficits | (181,095) | (166,973) |
Total Xunlei Limited's shareholders' equity | 292,154 | 296,878 |
Non-controlling interests | (1,781) | (1,335) |
Total liabilities and shareholders' equity | $ 415,605 | $ 424,687 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Allowance for credit losses of accounts receivable | $ 9,329,000 | $ 7,604,000 |
Allowance for credit losses of prepayments and other current assets | 10,283,000 | 5,503,000 |
Contract liabilities and deferred income, current portion of the consolidated variable interest entities and VIE's subsidiaries without recourse | 34,040,000 | 31,988,000 |
Contract liabilities and deferred income, non-current portion of the consolidated variable interest entities and VIE's subsidiaries without recourse | $ 920,000 | $ 1,223,000 |
Common stock, shares issued | 368,877,205 | 368,877,205 |
Common stock, shares outstanding | 334,401,981 | 339,165,241 |
Treasury stock, shares | 34,475,224 | 29,711,964 |
Variable Interest Entity, Primary Beneficiary [Member] | ||
Accounts payable, consolidated variable interest entities and VIE's subsidiaries without recourse | $ 20,588,000 | $ 23,865,000 |
Due to related party, consolidated variable interest entities and VIE's subsidiaries without recourse | 55,000 | 2,000 |
Contract liabilities and deferred income, current portion of the consolidated variable interest entities and VIE's subsidiaries without recourse | 34,040,000 | 31,988,000 |
Income tax payable, consolidated variable interest entities and VIE's subsidiaries without recourse | 2,500,000 | 2,436,000 |
Accrued liabilities and other payables, consolidated variable interest entities and VIE's subsidiaries without recourse | 33,361,000 | 38,502,000 |
Lease liabilities, current portion of the consolidated VIE and its subsidiaries without recourse | 1,912,000 | 4,621,000 |
Contract liabilities and deferred income, non-current portion of the consolidated variable interest entities and VIE's subsidiaries without recourse | 920,000 | 1,223,000 |
Deferred Taxes Liabilities Consolidated Variable Interest Entities Without Recourse | 1,085,000 | 1,179,000 |
Bank borrowings, consolidated variable interest entities and VIE's subsidiaries without recourse | 19,924,000 | 11,324,000 |
Lease liabilities, non-current portion, consolidated variable interest entities and VIE's subsidiaries without recourse | $ 27,000 | $ 4,073,000 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Net revenues | |||
Total revenues, net of rebates and discounts | $ 186,683 | $ 181,267 | $ 232,132 |
Business taxes and surcharges | (312) | (602) | (1,528) |
Net revenues | 186,371 | 180,665 | 230,604 |
Total cost of revenues | (92,637) | (99,913) | (115,667) |
Gross profit | 93,734 | 80,752 | 114,937 |
Operating expenses | |||
Research and development expenses | (55,463) | (68,571) | (76,763) |
Sales and marketing expenses | (18,064) | (31,820) | (35,322) |
General and administrative expenses | (33,910) | (38,930) | (40,833) |
Asset impairment loss, net of recoveries | (5,090) | 2,147 | (6,348) |
Total operating expenses | (112,527) | (137,174) | (159,266) |
Operating loss | (18,793) | (56,422) | (44,329) |
Interest income | 1,471 | 1,897 | 1,183 |
Interest expense | (406) | (75) | (239) |
Other income, net | 4,737 | 5,861 | 2,810 |
Share of loss from equity investees | (307) | ||
Loss from continuing operations before income tax | (12,991) | (48,739) | (40,882) |
Income tax benefits/(expenses) | (1,149) | (4,676) | 89 |
Net loss from continuing operations | (14,140) | (53,415) | (40,793) |
Discontinued operations | |||
Income from discontinued operations before income taxes | 1,533 | ||
Income tax expenses | (230) | ||
Net profit from discontinued operations | 1,303 | ||
Net loss for the year | (14,140) | (53,415) | (39,490) |
Less: net loss attributable to the non-controlling interests | (300) | (246) | (212) |
Net loss attributable to Xunlei Limited | (13,840) | (53,169) | (39,278) |
Net loss for the year | (14,140) | (53,415) | (39,490) |
Other comprehensive (loss)/income: Currency translation adjustments, net of tax | 11,135 | (650) | (5,539) |
Comprehensive loss | (3,005) | (54,065) | (45,029) |
Less: comprehensive loss attributable to non-controlling interest | (446) | (219) | (34) |
Comprehensive loss attributable to Xunlei Limited | $ (2,559) | $ (53,846) | $ (44,995) |
Loss per share for common shares, basic | |||
Continuing operations | $ (0.04) | $ (0.16) | $ (0.12) |
Discontinued operations | 0 | ||
Total loss per share for common shares, basic | (0.04) | (0.16) | (0.12) |
Loss per share for common shares, diluted | |||
Continuing operations | (0.04) | (0.16) | (0.12) |
Discontinued operations | 0 | ||
Total loss per share for common shares, diluted | $ (0.04) | $ (0.16) | $ (0.12) |
Weighted average number of common shares used in calculating continuing operations, -Basic | 337,429,601 | 337,845,675 | 334,965,987 |
Weighted average number of common shares used in calculating continuing operations, Diluted | 337,429,601 | 337,845,675 | 334,965,987 |
Service [Member] | |||
Net revenues | |||
Revenue from Contract with Customer, Including Assessed Tax | $ 185,271 | $ 172,998 | $ 177,528 |
Total cost of revenues | (90,977) | (92,732) | (84,033) |
Product [Member] | |||
Net revenues | |||
Revenue from Contract with Customer, Including Assessed Tax | 1,412 | 8,269 | 54,604 |
Total cost of revenues | $ (1,660) | $ (7,181) | $ (31,634) |
Consolidated statements of chan
Consolidated statements of changes in shareholders' equity - USD ($) $ in Thousands | Common shares | Treasury stock [Member] | Additional paid-in capital [Member] | Retained earnings (Accumulated deficits) [Member] | Statutory reserves [Member] | Accumulated other comprehensive income/(loss) [Member] | Total Xunlei Limited's shareholders' equity [Member] | Non-controlling interest [Member] | Total |
Beginning Balance, Amount at Dec. 31, 2017 | $ 83 | $ 9 | $ 461,330 | $ (74,526) | $ 5,132 | $ (7,031) | $ 384,997 | $ (2,160) | $ 382,837 |
Beginning Balance, Shares at Dec. 31, 2017 | 333,643,560 | 35,233,649 | |||||||
Share-based compensation | 5,294 | 5,294 | 5,294 | ||||||
Restricted shares vested, Amount | $ 1 | $ (1) | |||||||
Restricted shares vested, shares | 2,879,220 | (2,879,220) | |||||||
Net loss | (39,278) | (39,278) | (212) | (39,490) | |||||
Currency translation adjustments | (5,717) | (5,717) | 152 | (5,565) | |||||
Contribution by non-controlling interest holders | 197 | 197 | |||||||
Acquisition of a subsidiary | 907 | 907 | |||||||
Ending Balance, Amount at Dec. 31, 2018 | $ 84 | $ 8 | 466,624 | (113,804) | 5,132 | (12,748) | 345,296 | (1,116) | 344,180 |
Ending Balance, Shares at Dec. 31, 2018 | 336,522,780 | 32,354,429 | |||||||
Repurchase of common shares, Amount | $ (1) | ||||||||
Share-based compensation | 5,428 | 5,428 | 5,428 | ||||||
Restricted shares vested, Amount | $ 1 | ||||||||
Restricted shares vested, shares | 2,642,465 | (2,642,465) | |||||||
Cancellation of common shares | (4) | ||||||||
Net loss | (53,169) | (53,169) | (246) | (53,415) | |||||
Currency translation adjustments | (677) | (677) | 27 | (650) | |||||
Ending Balance, Amount at Dec. 31, 2019 | $ 85 | $ 7 | 472,052 | (166,973) | 5,132 | (13,425) | 296,878 | (1,335) | 295,543 |
Ending Balance, Shares at Dec. 31, 2019 | 339,165,241 | 29,711,964 | |||||||
Repurchase of common shares, Amount | $ (1) | $ 1 | (4,475) | (4,475) | (4,475) | ||||
Repurchase of common shares, shares | (5,956,960) | 5,956,960,000 | |||||||
Share-based compensation | 2,310 | 2,310 | 2,310 | ||||||
Restricted shares vested, shares | 1,193,700 | (1,193,700) | |||||||
Appropriation of statutory reserves | (282) | 282 | |||||||
Net loss | (13,840) | (13,840) | (300) | (14,140) | |||||
Currency translation adjustments | 11,281 | 11,281 | (146) | 11,135 | |||||
Ending Balance, Amount at Dec. 31, 2020 | $ 84 | $ 8 | $ 469,887 | $ (181,095) | $ 5,414 | $ (2,144) | $ 292,154 | $ (1,781) | $ 290,373 |
Ending Balance, Shares at Dec. 31, 2020 | 334,401,981 | 34,475,224 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from operating activities | |||
Net loss for the year | $ (14,140) | $ (53,415) | $ (39,490) |
Adjustments to reconcile net loss to net cash generated from/(used in) operating activities | |||
Depreciation of property and equipment | 9,277 | 5,824 | 5,595 |
Amortization of intangible assets | 1,216 | 1,200 | 1,231 |
Amortization of the right-of-use assets | 3,685 | 5,634 | |
Allowance for credit losses | 1,137 | 19 | 7,680 |
Impairment/(recovery) of prepayments and other assets | 4,168 | (2,147) | (1,516) |
Loss/(gain) on disposal of property and equipment | (55) | 144 | 37 |
Share-based compensation | 2,310 | 5,428 | 5,294 |
Share of loss from equity investees | 307 | ||
Investment income on short-term investments | (664) | (1,708) | (1,117) |
Impairment of inventories | 3,283 | 3,578 | 200 |
Impairment of long-term investments | 794 | 19,831 | 7,794 |
Net unrealized gains on long-term investments | (794) | (10,907) | |
Investment income on disposal of long-term investment | (214) | (579) | |
Interest expense accrued on long-term payable | 406 | 75 | 239 |
Deferred taxes | 966 | 4,361 | 1,748 |
Deferred government grants | (865) | (1,735) | (1,050) |
Changes in operating assets and liabilities: | |||
Accounts receivable | 5,048 | (8,739) | 13,256 |
Prepayments and other assets | (1,263) | 772 | (2,000) |
Due from/to related parties | (8,598) | (684) | 11,457 |
Accounts payable | (4,938) | 2,086 | (27,728) |
Inventories | 643 | 3,435 | (10,178) |
Contract liabilities | 289 | (664) | 7,680 |
Income tax payable | (163) | 98 | (390) |
Accrued liabilities and other payables | (11,707) | (12,580) | (14,657) |
Lease liabilities | (3,732) | (4,976) | |
Net cash used in operating activities | (13,911) | (45,649) | (35,608) |
Cash flows from investing activities | |||
Purchase of short-term investments | (177,075) | (355,294) | (287,553) |
Proceeds from disposal of short-term investments | 167,439 | 450,687 | 223,738 |
Proceeds from disposal of property and equipment | 721 | 576 | 442 |
Proceeds from disposal of long-term investments | 1,076 | 528 | |
Purchase of intangible assets | (59) | (433) | (2,121) |
Acquisition of long-term investments | (2,838) | ||
Repayment of loans from employees | 696 | 711 | 201 |
Acquisition of property and equipment | (134) | (3,084) | (1,419) |
Payment for constructions in progress | (13,420) | (11,593) | (2,645) |
Net cash (used in)/generated from investing activities | (20,756) | 79,260 | (69,357) |
Cash flows from financing activities | |||
Repurchase of shares | (4,475) | ||
Governments grants received | 853 | 732 | |
Contribution by non-controlling | 197 | ||
Proceeds from bank borrowings | 7,816 | 11,324 | |
Repayment of loans due to a related party arising from a business combination | (662) | ||
Net cash generated from financing activities | 2,679 | 12,177 | 929 |
Net (decrease)/increase in cash, cash equivalents and restricted cash | (31,988) | 45,788 | (104,036) |
Cash, cash equivalents, and restricted cash at beginning of year | 165,448 | 122,930 | 233,479 |
Effect of exchange rates on cash and cash equivalents, and restricted cash | 5,329 | (3,270) | (6,513) |
Cash, cash equivalents, and restricted cash at end of year | 138,789 | 165,448 | 122,930 |
Supplemental disclosure of cash flow information | |||
Income tax paid | (356) | (142) | |
Non cash investing and financing activities | |||
Acquisition of property and equipment in form of other payables | (5,217) | (321) | $ (1,093) |
Acquisition of right-of-use assets and lease liabilities, net off impact from lease modification | $ (3,325) | $ 2,723 |
Organization and nature of oper
Organization and nature of operations | 12 Months Ended |
Dec. 31, 2020 | |
Organization and nature of operations | |
Organization and nature of operations | 1. Organization and nature of operations Xunlei Limited, previously known as Giganology Limited, (the “Company”) was incorporated under the law of the Cayman Islands (“Cayman”) as a limited liability company on February 3, 2005. The Company completed its initial public offering (“IPO”) on June 24, 2014 on the NASDAQ Global Market. Each American Depositary Shares (“ADSs”) of the Company represents five common shares. These consolidated financial statements include the financial statements of the Company, its subsidiaries, its variable interest entity (“VIE”) and the VIE’s subsidiaries (collectively referred to as the “Group”). As of December 31, 2020, the Company’s major subsidiaries, VIE and VIE’s subsidiaries are as follows: % of direct or indirect Place of Period of economic Name of entities incorporation incorporation Relationship ownership Principal activities Shenzhen Xunlei Networking Technologies Co., Ltd. (“Shenzhen Xunlei”) People’s Republic of China (“PRC”) January 2003 VIE 100 % Development of software, provision of online and related advertising, membership subscription and online game services, as well as sales of software licenses Giganology (Shenzhen) Co., Ltd. (“Giganology Shenzhen”) PRC June 2005 Subsidiary 100 % Development of computer software and provision of information technology services to related companies Shenzhen Xunlei Wangwenhua Co., Ltd. (formerly known as “Shenzhen Fengdong Networking Technologies Co., Ltd.”) (“Wangwenhua”) PRC December 2005 VIE’s subsidiary 100 % Development of software for related companies and provision of advertising services Shenzhen Zhuolian Software Co., Ltd. (formerly known as “Xunlei Software (Shenzhen) Co., Ltd.”) PRC January 2010 VIE’s subsidiary 100 % Provision of software technology development for related companies Xunlei Games Development (Shenzhen) Co., Ltd. (“Xunlei Games”) PRC February 2010 VIE’s subsidiary 70 % Development of online game and computer software for related companies and provision of advertising services Xunlei Network Technologies Limited (“Xunlei BVI”) British Virgin Islands February 2011 Subsidiary 100 % Holding company Xunlei Network Technologies Limited (“Xunlei HK”) Hong Kong March 2011 Subsidiary 100 % Holding company and development of computer software Xunlei Computer (Shenzhen) Co., Ltd. (“Xunlei Computer”) PRC November 2011 Subsidiary 100 % Development of computer software and provision of information technology services Shenzhen Onething Technologies Co., Ltd. (“Onething”) PRC September 2013 VIE’s subsidiary 100 % Development of computer software, sale of hardware, and provision of information technology services Beijing Xunjing Technologies Co., Ltd. (formerly known as “Wangxin Century Technologies (Beijing) Co., Ltd.”) (“Beijing Xunjing”) PRC October 2015 VIE’s subsidiary 100 % Development of computer software and provision of information technology services 1. Organization and nature of operations (Continued) % of direct or indirect Place of Period of economic Name of entities incorporation incorporation Relationship ownership Principal activities Shenzhen Crystal Interactive Technologies Co., Ltd. (“Crystal Interactive”) PRC May 2016 VIE’s subsidiary 100 % Development of computer software and provision of information technology services Beijing Onething Technologies Co., Ltd. PRC January 2017 VIE’s subsidiary 100 % Provision of technology services and development of computer software HK Onething Technologies Ltd. (“HK Onething”) Hong Kong December 2017 Subsidiary 100 % Development of cloud computing technology and provision of related services Hainan Onething E-Sports Co., Ltd. PRC May 2018 Subsidiary 100 % Development of computer software and E-sports related services Henan Tourism Information Co., Ltd. (“Henan Tourism”) PRC June 2018 VIE’s Subsidiary 80 % Software development, tourism consulting and other related services Onething Co., Ltd. (Thailand) (“Thailand Onething”) Thailand July 2018 Subsidiary 49 % Development of cloud computing technology and provision of related services Hainan Xunlei Blockchain Technology Co., Ltd. PRC August 2018 VIE’s subsidiary 100 % Development of computer software and provision of information technology services Shenzhen Yunwang Wulian Technology Co., Ltd. (formerly known as “Shenzhen Qianhai Shanxian Daojia Technology Co., Ltd.”, “Shanxian Daojia”) PRC September 2020 Subsidiary 100 % Development of computer software and provision of information technology services Jiangxi Node Technology Service Co., Ltd. PRC July 2020 Subsidiary 100 % Development of computer software and provision of information technology services Note a : The English names of the PRC companies represent management’s translation of the Chinese names of these companies as they have not adopted formal English names. The Group engages primarily in the provision of premium downloading services to its members, online advertising services on its websites and mobile phone applications, sales of bandwidth, sales of cloud computing hardware, platform for live streaming services, online game platform for game developers and users and other internet value added services. To comply with the PRC laws and regulations that prohibit or restrict foreign ownership of companies that provide online advertising services, operate online games, and hold Internet Content Provider (‘‘ICP’’) license, the Company conducts its business through Shenzhen Xunlei, its consolidated VIE. Through the various agreements enacted among the Company, Giganology Shenzhen, a wholly owned subsidiary of the Company, Shenzhen Xunlei and legal shareholders of Shenzhen Xunlei, the Company received all of the economic benefits and residual interest and absorbed all of the risks and expected losses from Shenzhen Xunlei. 1. Organization and nature of operations (Continued) Details of certain key agreements with the VIE are as follows: — Loan Agreements Under a separate loan agreement between Giganology Shenzhen and Mr. Sean Shenglong Zou as a legal shareholder of Shenzhen Xunlei, Giganology Shenzhen made an additional interest-free loan of RMB20 million to Mr. Sean Shenglong Zou, the entire amount of which was contributed to the registered capital of Shenzhen Xunlei, increasing the registered capital of Shenzhen Xunlei to RMB 30 million. The term of this agreement lasts for two years from the date it was signed, and will be automatically extended afterwards on a yearly basis until Mr. Zou has repaid the loan in its entirety in accordance with the loan agreement. This loan will be deemed to be repaid when all equity interest held by the shareholders in Shenzhen Xunlei has been transferred to Giganology Shenzhen or its designated parties. At any time during the term of this loan agreement, the Company may, at their sole discretion, require all or any portion of the outstanding loan under the agreement to be repaid. — Business Operation Agreements — Equity Pledge Agreement — Power of Attorney 1. Organization and nature of operations (Continued) — Service Agreements For the Exclusive Technology Support and Services Agreement and the Exclusive Technology Consulting and Training Agreement, the term of these agreements will expire in 2025 and may be extended with Giganology Shenzhen’s written confirmation prior to the expiration date. Giganology Shenzhen is entitled to terminate the agreement at any time by providing 30 days' prior written notice to Shenzhen Xunlei. For the Proprietary Technology License Contract, the term of this contract will expire in 2022 and may be extended with Giganology Shenzhen’s written confirmation prior to the expiration date. Giganology Shenzhen grants Shenzhen Xunlei a non-exclusive and non-transferable right to use Giganology Shenzhen’s proprietary technology. Shenzhen Xunlei can only use the proprietary technology to conduct business according to its authorized business scope. Giganology Shenzhen or its designated representative(s) owns the rights to any new technology developed due to implementation of this contract. —Intellectual Properties Purchase Option Agreement — Call Option Agreement As a result of these agreements (collectively defined as “Structured Service Contracts”), Giganology Shenzhen can exercise effective control over Shenzhen Xunlei, receives all of the economic benefits and residual interest and absorbs all of the risks and expected losses from Shenzhen Xunlei as if it were the sole shareholder, and has an exclusive option to purchase all of the equity interest in Shenzhen Xunlei at a minimal price. Therefore, Giganology Shenzhen is considered the primary beneficiary of Shenzhen Xunlei and accordingly Shenzhen Xunlei’s results of operations, assets and liabilities have been consolidated in the Company’s financial statements. 1. Organization and nature of operations (Continued) VIE-Related Risks It is possible that the Group’s operation of certain of its operations and businesses through VIEs could be found by PRC authorities to be in violation of PRC laws and regulations prohibiting or restricting foreign ownership of companies that engage in such operations and businesses. While the Group’s management considers the possibility of such a finding by PRC regulatory authorities under current laws and regulations to be remote, on January 19, 2015, the Ministry of Commerce of the PRC, or (the “MOFCOM”) released on its Website for public comment a proposed PRC law (the “Draft FIE Law”) that appears to include VIEs within the scope of entities that could be considered to be foreign invested enterprises (or “FIEs”) that would be subject to restrictions under existing PRC law on foreign investment in certain categories of industry. Specifically, the Draft FIE Law introduces the concept of “actual control” for determining whether an entity is considered to be an FIE. In addition to control through direct or indirect ownership or equity, the Draft FIE Law includes control through contractual arrangements within the definition of “actual control”. If the Draft FIE Law is passed by the People’s Congress of the PRC and goes into effect in its current form, these provisions regarding control through contractual arrangements could be construed to reach the Group’s VIE arrangements, and as a result the Group’s VIEs could become explicitly subject to the current restrictions on foreign investment in certain categories of industry. The Draft FIE Law includes provisions that would exempt from the definition of foreign invested enterprises entities where the ultimate controlling shareholders are either entities organized under PRC law or individuals who are PRC citizens. On December 26, 2018, the Standing Committee of National People’s Congress published the Draft FIE Law on its official website for public consultation (the “2018 Draft Foreign Investment Law”). The 2018 Draft Foreign Investment Law does not explicitly recognize the variable interest entity structure as a form of foreign investment. Since the 2018 Draft Foreign Investment Law remains silent with respect to the variable interest entity structure as a form of foreign investment, the validity of the Group’s VIE structure as a whole and each of the agreements comprising VIEs will not be affected by the 2018 Draft Foreign Investment Law. It leaves leeway for government’s future regulation of the variable interest entity structure. According to the deliberation and voting results from the final session of the 13 th If a finding was made by PRC authorities under existing laws and regulations and becomes effective, the Group’s operation of certain of its operations and businesses through VIEs, regulatory authorities with jurisdiction over the licensing and operation of such operations and businesses would have broad discretion in dealing with such a violation, including levying fines, confiscating the Group’s income, revoking the business or operating licenses of the affected businesses, requiring the Group to restructure its ownership structure or operations, or requiring the Group to discontinue all or any portion of its operations. Any of these actions could cause significant disruption to the Group’s business operations, and have a severe adverse impact on the Group’s cash flows, financial position and operating performance. In addition, it is possible that the contracts among the Group, the Group’s VIEs and shareholders of its VIEs would not be enforceable in China if PRC government authorities or courts were to find that such contracts contravene PRC law and regulations or are otherwise not enforceable for public policy reasons. In the event that the Group was unable to enforce these contractual arrangements, the Group would not be able to exert effective control over the affected VIEs. Consequently, such VIE’s results of operations, assets and liabilities would not be included in the Group’s consolidated financial statements. If such were the case, the Group’s cash flows, financial position and operating performance would be severely adversely affected. The Group’s contractual arrangements with respect to its consolidated VIEs are approved and in place. The Group’s management believes that such contracts are enforceable, and considers the possibility remote that PRC regulatory authorities with jurisdiction over the Group’s operations and contractual relationships would find the contracts to be unenforceable. |
Summary of significant accounti
Summary of significant accounting policies | 12 Months Ended |
Dec. 31, 2020 | |
Summary of significant accounting policies | |
Summary of significant accounting policies | 2. Summary of significant accounting policies (a) Basis of presentation and use of estimates The consolidated financial statements of the Group have been prepared in accordance with accounting principles generally accepted in the United States of America (‘‘U.S. GAAP’’). Significant accounting policies followed by the Group in the preparation of the accompanying consolidated financial statements are summarized below. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the accompanying consolidated financial statements and related disclosures. Actual results could differ materially from these estimates. Significant accounting estimates reflected in the Group’s consolidated financial statements mainly include allowance for credit losses, valuation allowance of deferred tax assets, impairment assessment of goodwill and impairment assessment of long-lived assets. In addition, the Group uses assumptions in a valuation model to estimate the fair value of share options granted, warrants issued and underlying common shares. Management bases the estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results could differ from these estimates. (b) Consolidation The consolidated financial statements include the financial statements of the Company, its subsidiaries, VIE for which the Company is the primary beneficiary and its subsidiaries. All significant transactions and balances among the Company, its subsidiaries, VIE and its subsidiaries have been eliminated upon consolidation. A subsidiary is an entity in which the Company, directly or indirectly, controls more than one-half of the voting power, or has the power to appoint or remove the majority of the members of the board of directors to cast majority of votes at meetings of the board of directors or to govern the financial and operating policies of the investee under a statute or agreement among the shareholders or equity holders. An entity is considered to be a VIE if the entity’s equity holders do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. The Group consolidates entities for which the Company is the primary beneficiary if the entity’s other equity holders do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. 2. Summary of significant accounting policies (Continued) (b) Consolidation (Continued) In determining whether the Company or its subsidiary is the primary beneficiary of a VIE, the Company considered whether it has the power to direct activities that are significant to the VIE’s economic performance, including the power to appoint senior management, right to direct company strategy, power to approve capital expenditure budgets, and power to establish and manage ordinary business operation procedures and internal regulations and systems. Management has evaluated the contractual arrangements among Giganology Shenzhen, Shenzhen Xunlei and its shareholders and concluded that Giganology Shenzhen receives all of the economic benefits and absorbs all of the expected losses from Shenzhen Xunlei and has the power to direct the aforementioned activities that are significant to Shenzhen Xunlei’s economic performance, and is the primary beneficiary of Shenzhen Xunlei. Therefore, Shenzhen Xunlei and its subsidiaries’ results of operation, assets and liabilities have been included in the Group’s consolidated financial statements. Management monitors the regulatory risk associated with these contractual arrangements. See note 29 for further discussion. Non-controlling interests represent the portion of the net assets of a subsidiary attributable to interests that are not owned by the Company. The non-controlling interests are presented in the consolidated balance sheets, separately from equity attributable to the shareholders of the Company. Non-controlling interests in the results of the Group is presented on the face of the consolidated statements of comprehensive income as an allocation of the total income or loss for the year between non-controlling shareholders and the shareholders of the Company. (c) The Group accounts for acquisitions of entities that include inputs and processes and have the ability to generate economic benefit as business combinations. The Group allocates the purchase price of the acquisition to the tangible assets and identifiable intangible assets acquired based on their estimated fair values. The excess of the purchase price over those fair values is recorded as goodwill. Acquisition-related costs are expensed as incurred. (d) Discontinued operations When disposals that represent a strategic shift that has (or will have) a major effect on the entity’s results and operations would qualify as discontinued operations. Discontinued operations are reported when a component of an entity comprising operations and cash flows that can be clearly distinguished, operationally and for financial reporting purposes, from the rest of the entity is classified as held for disposal or has been disposed of, if the component either (1) represents a strategic shift or (2) have a major impact on an entity’s financial results and operations. Examples include a disposal of a major geographical location, line of business, or other significant part of the entity, or disposal of a major equity method investment. In the consolidated statement of comprehensive income, result from discontinued operations is reported separately from the income and expenses from continuing operations and prior periods are presented on a comparative basis. Cash flows for discontinuing operations are presented separately in note 4. In order to present the financial effects of the continuing operations and discontinued operations, revenues and expenses arising from intra-group transactions are eliminated except for those revenues and expenses that are considered to continue after the disposal of the discontinued operations. 2. Summary of significant accounting policies (Continued) (d) Discontinued operations (Continued) Non-current assets or disposal groups are classified as held for sale assets when the carrying amount is to be recovered principally through a sale transaction rather than through continuing use. For this to be the case, the asset or disposal group must be available for immediate sale in its present condition subject only to terms that are usual and customary for sale of such assets or disposal groups and the sale must be highly probable. Non-current assets classified as held for sale and disposal groups are measured at the lower of their carrying or fair value less costs to sell. (e) Foreign currency translation The Company’s reporting and functional currency is the United States Dollar (‘‘USD’’). Xunlei BVI, Xunlei HK and HK Onething’s functional currency is the USD, and Thailand Onething’s functional currency is the Thai Baht (“THB”). The functional currency of other subsidiaries, VIE and its subsidiaries located in the PRC is the Renminbi (‘‘RMB’’), which is their respective local currency. Transactions denominated in foreign currencies are remeasured into the functional currency at the exchange rates prevailing on the transaction dates. Financial assets and liabilities denominated in foreign currencies are remeasured into the functional currency using the applicable exchange rates prevailing at the balance sheet date. The resulting exchange gains and losses from foreign currency transactions are included in other income/(loss) within the consolidated statements of comprehensive income. The Company uses the monthly average exchange rate for the year and the exchange rates at the balance sheet date to translate the operating results and financial position, respectively, of its subsidiaries whose functional currency is other than the USD. The resulting translation differences are recorded in cumulated translation adjustments, a component of shareholders’ equity. The exchange rate used is the one released by Chinese State Administration of Foreign Exchange. (f) Cash and cash equivalents and restricted cash Cash and cash equivalents include cash on hand, cash in bank and time deposits placed with banks or other financial institutions, which have original maturities of three months or less and are readily convertible to known amounts of cash. Cash that is restricted as to withdrawal or for use or pledged as security is reported separately on the face of the consolidated balance sheets, and is included in the total cash, cash equivalents, and restricted cash in the consolidated statements of cash flows. The Group's restricted cash is substantially cash balance on deposit required by its business partners, commercial banks and the court. (g) Short-term investments Short-term investments include deposits placed with banks with original maturities of more than three months but within one year and investments in financial instruments with a variable interest rate indexed to the performance of underlying assets. In accordance with ASC 825 Financial Instruments 2. Summary of significant accounting policies (Continued) (h) Allowance for expected credit losses Effective on January 1, 2020, the Group adopted Accounting Standards Update (ASU) 2016-13, Financial Instruments - Credit Losses (Topic 326) The Group assessed the credit loss for accounts receivable with similar risk characteristics on a pool basis. The credit loss assessment for each pool was mainly based on past collection experience, consideration of current and future economic conditions and changes in our collection trends. The credit allowances provided for accounts receivable from continuing operations as of December 31, 2019 and 2020 were USD 7,604,000 and USD 9,329,000, respectively. (i) Inventories Inventories are stated at the lower of cost or net realizable value. Cost is determined using actual cost on a weighted average basis. Net realizable value is the amount that can be realized from the sale of the inventory in the normal course of business after allowing for the costs of realization. (j) Long-term investments The Group holds investments in privately held companies. Prior to adopting ASU 2016-01, Financial Instruments On January 1, 2018, the Group adopted ASU 2016-01, Financial Instruments 2. Summary of significant accounting policies (Continued) (j) Long-term investments (Continued) Management regularly evaluates the impairment of long-term equity investments based on performance and financial position of the investee as well as other evidence of market value. Such evaluation includes, but not limited to, reviewing the investee’s cash position, recent financing, projected and historical financial performance, cash flow forecasts and financing needs. An impairment loss recognized equal to the excess of the investment costs over its fair value at the end of each reporting period for which the assessment is made. The fair value would then become the new cost basis of investment. During the years ended December 31, 2018, 2019 and 2020 the Group recognized an impairment of USD 7,794,000, USD 19,830,000 and USD 794,000, and share of loss of equity investees of USD 317,000, nil and nil, respectively, from equity method investments. (k) Property and equipment Property and equipment are stated at historical cost less accumulated depreciation and impairment loss, if any. Depreciation is calculated using the straight-line method over their estimated useful lives. Residual rate is determined based on the economic value of the asset at the end of the estimated useful life as a percentage of the original cost. If the Group commits to a plan to abandon a long-lived asset before the end of its previous estimated useful life, depreciation shall be revised to reflect a shortened useful life. Estimated useful lives Residual rate Servers and network equipment 3-5 years 5 % Computer equipment 5 years 5 % Furniture, fittings and office equipment 3-5 years 5 % Motor vehicles 5 years 5 % Leasehold improvements Shorter of lease term or 3 years — Repair and maintenance costs are expensed as incurred. Expenditures that substantially increase an asset’s useful life are capitalized. Upon sale or disposal, gain or loss on the disposal of property and equipment is the difference between the net sales proceeds and the carrying amount of the relevant assets and is recognized in the consolidated statements of comprehensive loss. The cost and related accumulated depreciation are removed from the balance sheets. (l) Goodwill Goodwill represents the excess of the purchase consideration over the fair value of the identifiable tangible and intangible assets acquired and liabilities assumed from the acquired entity as a result of the Company’s acquisitions of interests in its subsidiaries and consolidated VIEs. Goodwill is not amortized but is tested for impairment on an annual basis, or more frequently if events or changes in circumstances indicate that it might be impaired. The Company first assesses qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. In the qualitative assessment, the Company considers primary factors such as industry and market considerations, overall financial performance of the reporting unit, and other specific information related to the operations. Based on the qualitative assessment, if it is more likely than not that the fair value of each reporting unit is less than the carrying amount, the quantitative impairment test is performed. 2. Summary of significant accounting policies (Continued) (l) Goodwill (Continued) In performing the two-step quantitative impairment test, the first step compares the fair values of each reporting unit to its carrying amount, including goodwill. If the fair value of each reporting unit exceeds its carrying amount, goodwill is not considered to be impaired and the second step will not be required. If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of goodwill to the carrying value of a reporting unit’s goodwill. The implied fair value of goodwill is determined in a manner similar to accounting for a business combination with the allocation of the assessed fair value determined in the first step to the assets and liabilities of the reporting unit. The excess of the fair value of the reporting unit over the amounts assigned to the assets and liabilities is the implied fair value of goodwill. This allocation process is only performed for the purposes of evaluating goodwill impairment and does not result in an entry to adjust the value of any assets or liabilities. Application of a goodwill impairment test requires significant management judgment, including the identification of reporting units, allocation of assets, liabilities and goodwill to reporting units, and determination of the fair value of each reporting unit. Starting in 2020, the Company adopted the FASB issued ASU 2017-04: Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (the “Update”). To simplify the subsequent measurement of goodwill, the Board eliminated Step 2 from the goodwill impairment test. Under the amendments in this Update, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. An entity should apply the amendments in this Update on a prospective basis. An entity is required to disclose the nature of and reason for the change in accounting principle upon transition. It is more likely that, by adopting simplified measurement which eliminates the Step 2 from goodwill impairment test, an entity with the triggering event for goodwill impairment will recognize more goodwill impairment than it would do under the old model. The Group’s goodwill was attributable to the Company as a whole. The impairment test for goodwill determines the fair value of the reporting unit, the Company as a whole, and compares it to the carrying value of the assets and liabilities, including goodwill, of the reporting unit. The fair value of the Company was estimated by management using the discounted cash flow model derived from the long-term (five-year) cash flow projections, which included significant judgements and assumptions relating to revenue forecast and operating margins, discount rate of 18.2% that reflects market assessments of the time value and the specific risks relating to the Company, and cash flows beyond the five-year period are extrapolated using a terminal growth rate of 2%. No goodwill impairment losses were recognized for the years ended December 31, 2018, 2019 and 2020 based on the impairment test performed by the Group. (m) Intangible assets Intangible assets, which include land use rights, acquired computer software, online game licenses and audio-visual license, are carried at cost less accumulated amortization with no residual value and impairment loss, if any. Amortization of intangible assets is computed using the straight-line method over the estimated useful lives of the assets as follows: Estimated useful lives Land use rights 30 years Acquired computer software 5 years Online game licenses 1 Audio-visual license 9 years 2. Summary of significant accounting policies (Continued) (n) Impairment of long-lived assets For other long-lived assets, the Group evaluates its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may no longer be recoverable. The Group assesses the recoverability of the long-lived assets by comparing the carrying value of the long-lived assets to the estimated undiscounted future cash flows expected to be received from use of the assets and their eventual disposition at the lowest level of identifiable cash flows. Such assets are considered to be impaired if the sum of the expected undiscounted cash flows is less than the carrying amount of the assets. If the Group identifies an impairment, the carrying value of the asset will be reduced to its estimated fair value based on a discounted cash flow approach or, when available and appropriate, to comparable market values. (o) Commitments and contingencies In the normal course of business, the Group is subject to contingencies, such as legal proceedings and claims arising out of its business, that cover a wide range of matters. Liabilities for such contingencies are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated. In regard to legal cost, the Group recorded such costs as incurred. Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Group, but which will only be resolved when one or more future events occur or fail to occur. The Group’s management and its legal counsel assess such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Group or unasserted claims that may result in such proceedings, the Group, in consultation with its legal counsel, evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Group’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss, if determinable and material, would be disclosed. (p) Operating leases On January 1, 2019, the Group adopted ASC Topic 842 Leases Lessees shall follow the requirements to classify most leases as either financing or operating using principles similar to previous lease accounting. In the statement of comprehensive income, a lessee shall present both of the following: a) for finance leases, the interest expense on the lease liability and amortization of the right-of-use asset are not required to be presented as separate line items and shall be presented in a manner consistent with how the entity presents other interest expense and depreciation or amortization of similar assets, respectively; b) for operating leases, lease expense shall be included in the lessee’s income from continuing operations. 2. Summary of significant accounting policies (Continued) (p) Operating leases (Continued) The Group adopted ASC 842 on a modified retrospective basis and did not restate comparative periods. The adoption of ASC 842 resulted in the recognition of right-of-use assets and related lease liabilities of approximately USD11.8 million and USD11.4 million, respectively, which were reported on the consolidated balance sheet as of January 1, 2019. The Group have elected the short-term lease exemption for all leases with a lease term of 12 months. Payments associated with short-term leases are recognized on a straight-line basis as an expense in profit or loss. The standard also requires a lessee to recognize a single lease cost related to operating lease, calculated so that the cost of the lease is allocated over the lease term, on a generally straight-line basis. The net profit after tax had not to be materially impacted as a result of adopting the new rules. With the adoption of ASC 842, the Group assesses, at contract inception, whether a contract is, or contains, a lease. That is, if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. In determining the appropriate discount rate to use in calculating the present value of contractual lease payments, management regularly evaluates the lessee’s incremental borrowing rate, as the rate implicit in the lease cannot be readily determined. See note 12 for additional disclosures on operating lease arrangements. (q) Revenue recognition The Group adopted ASC Topic 606 Revenue from Contracts with Customer Revenue is recognized when or as the control of the services or goods is transferred to the customer. Depending on the terms of the contract and the laws that apply to the contract, control of the services and goods may be transferred over time or at a point in time. A contract liability is the Group’s obligation to transfer goods or services to a customer for which the Group has received consideration (or an amount of consideration is due) from the customer. Contract costs includes incremental costs of obtaining a contract and costs to fulfil a contract. The Group generates revenues from various streams. Net revenues presented in the consolidated statements of loss represent revenues from service and product sales net off sales discount, value-added tax and related surcharges. 2. Summary of significant accounting policies (Continued) (q) Revenue recognition (Continued) (I) Subscription revenues The Group operates a VIP membership program where VIP members can have access to high speed online acceleration services, online streaming and other access privileges. The membership fee is time-based and is collected up-front from subscribers. The terms of time-based subscriptions range from one month to twelve months, with the subscribers having the option to renew the contract. The receipt of subscription fee is initially recorded as contract liabilities. The Group satisfies its various performance obligations by providing services throughout the subscription period and revenue is recognized ratably over the period of subscription as services are rendered. Unrecognized portion beyond 12 months from balance sheet date is classified as a long-term liability. The Group evaluated the principal versus agent criteria and determined that the Group is the principal in the transaction and accordingly records revenue on a gross basis. In determining whether to report revenues gross for the amount of subscription revenue, the Group assesses whether it maintains the principal relationship with the VIP members, whether it bears the credit risk and whether it establishes prices for the end users. Service fees levied by online system, fixed phone line and mobile payment channels (‘‘Payment handling charges’’) are recorded as the cost of revenues in the same period as the revenue for the membership fee is recognized. (II) Advertising revenues Advertising revenues are derived principally from arrangements where the customers pay to place their advertisements on the Group’s platform over a particular period of time. It includes multiple performance obligations, primarily for advertisements to be displayed in different spots at different times, placed under different formats including but are not limited to videos, banners, links, logos and buttons. Advertisements on the Group’s platform are generally charged on the basis of duration, and advertising contracts are signed to establish the fixed price and the advertising services to be provided. The Group enters into advertising contracts with third party advertising agencies that represents advertisers, as well as directly with advertisers. A typical contract term would range from a few days to 3 months. Both third party advertising agencies and direct advertisers are generally billed at the end of the display period and payments are due usually within 3 months. Where the Group’s customers purchase multiple advertising spaces with different display periods in the same contract, the Group allocates the total consideration to the various advertising elements based on their relative fair values and recognizes revenue for the different elements over their respective display periods. The Group determines the fair values of different advertising elements based on the prices charged when these elements were sold on a standalone basis. The Group recognizes revenue on the elements delivered and defers the recognition of revenue for the fair value of the undelivered elements until the remaining obligations have been satisfied. Where all of the elements within an arrangement are delivered uniformly over the agreement period, the revenue is recognized on a straight-line basis over the contract period. Transactions with third party advertising agencies For contracts entered into with third party advertising agencies, the third-party advertising agencies will in turn sell the advertising services to advertisers. Revenue is recognized ratably over the contract period of display. The Group provides sales incentives in the forms of discounts and rebates to third party advertising agencies based on purchase volume. As the advertising agencies are viewed as the customers in these transactions, revenue is recognized based on the price charged to the agencies, net of sales incentives provided to the agencies. Sales incentives are estimated and recorded at the time of revenue recognition based on the contracted rebate rates and estimated sales volume based on historical experience. 2. Summary of significant accounting policies (Continued) (q) Revenue recognition (Continued) (II) Advertising revenues (Continued) Transactions with advertisers The Group also enters into advertisement contracts directly with advertisers. Under these contracts, similar to transactions with third party advertising agencies, the Group recognizes revenue ratably over the contract period of display. The terms and conditions, including price, are fixed according to the contract between the Group and the advertisers. The Group also performs credit assessment of all advertisers prior to entering into contracts. Revenue is recognized based on the amount charged to the advertisers, net of discounts. The Group has estimated and recorded sales rebates provided to the agencies and advertisers of USD 394,000, nil and nil for the years ended December 31, 2018, 2019 and 2020, respectively. Transactions with advertising platforms Xunlei also cooperates with advertising platforms such as Guangdiantong and Baidu, of which, the advertising platforms are responsible for matching the requirements of advertisers or advertising agencies and dispatching the advertising content to Xunlei's platforms by certain analysis systematically. As the advertising platforms are viewed as customers in these transactions, revenue is recognized monthly based on the data publicized on the platforms and pre-agreed sharing portion. In May 2020, the Group entered into a user traffic monetization agreement with Beijing Itui Technology Co., Ltd. (“Beijing Itui”), a company controlled by the Company's principal shareholder. Since May 2020, Beijing Itui has been handling all of the Group's advertising resources, including matching the requirements of advertisers and dispatching the advertising content to Xunlei's platforms. Beijing Itui is viewed as the customer and revenue is recognized monthly based on the data publicized on the platforms and pre-agreed sharing portion. (III) Live streaming revenue The Group operates a live streaming platform where users can access the platform, view the live streaming content provided by the Group’s performers, and purchase virtual gifts which they can grant to performers in the live streaming platform to show support for their favorite performers. Xunlei is the principal in the provision of the live streaming content and experience, which is considered as the performance obligation of the Group. The Group recognized revenue from sales of virtual gifts to the viewers when the relevant virtual gifts are presented to the performers or over the duration of stated period of the time-based item. The Group does not have further obligations to the viewers after the virtual gifts are consumed immediately or after the stated period for time-based items, although the Group will continue to provide the live streaming content to the viewers in order to continue to generate more sales of virtual gifts. (IV) Cloud computing and other internet value-added services (i) Revenues from cloud computing As part of the Group’s cloud computing business, the Group engages in sale of OneThing Cloud. OneThing Cloud is a personal cloud hardware device that allows users to share their idle bandwidth with the Group, in exchange for LinkTokens. LinkTokens are not convertible into cash but they can be used to redeem products and services offered in the LinkTokens Mall. LinkTokens represent an obligation to deliver future services by the operator of the LinkToken program. 2. Summary of significant accounting policies (Continued) (q) Revenue recognition (Continued) (IV) Cloud computing and other internet value-added services (Continued) (i) Revenues from cloud computing (Continued) Prior to April 1, 2019, the bandwidth shared by the users in exchange for LinkTokens is an identifiable benefit which the Group can reasonably estimate fair value. The benefit that the Group receives from user’s contribution of bandwidth is independent from OneThing Cloud that the Group sells to users. In April 2019, the Group transferred the operation of LinkTokens, including the issuance and redemption obligation of LinkTokens, as well as the LinkTokens Mall to a third party, Beijing LinkChain Co., Ltd. (“Beijing LinkChain”). Upon completion of the transfer, users could continue to share their idle bandwidth with the Group in exchange for the LinkTokens issued by Hainan LinkChain Networking Technology Co., Ltd. (“Hainan LinkChain”), a wholly owned subsidiary of Beijing LinkChain, (note 9). In addition, the Group is obligated to pay to Hainan LinkChain a pre-determined amounts per active |
Business combination
Business combination | 12 Months Ended |
Dec. 31, 2020 | |
Business combination | |
Business combination | 3. Business combination In September 2020, the Group entered into a sale and purchase agreement to acquire 100% equity interests of Shanxian Daojia from Weimin Luo, a director and Chief Operating Officer of the Company (see note 26), and a third party individual at nil consideration while taken up the net liabilities of Shanxian Daojia The allocation of the purchase price at the date of acquisition is as follows: USD (In thousands) As of acquisition date Property and equipment, net 17 Accrued liabilities and other payables (798) Goodwill 781 Total — Shanxian Daojia is a company principally operating an internet platform for daily services. The purpose of this acquisition is to acquire the skilled talents of Shanxian Daojia and goodwill arising from this acquisition is attributable to the acquired workforce. This acquisition was completed on September 30, 2020. The acquired goodwill is not deductible for tax purposes. Acquisition related costs were immaterial and were included in general and administrative expenses for the year ended December 31, 2020. Pro forma revenue data and pro forma earnings data was not disclosed because the impact was immaterial. |
Discontinued operations
Discontinued operations | 12 Months Ended |
Dec. 31, 2020 | |
Discontinued operations | |
Discontinued operations | 4. Discontinued operations In December 2017, the Company signed a contract (“Disposal Agreement”) to divest its web game business, a major line of the Group’s online game business, to Shenzhen Xunyi Network Technology Corp., Ltd. (“Shenzhen Xunyi”), a company operated by a few former core members of Xunlei’s web game business at a consideration of RMB 4,180,000 (equivalent to approximately USD 640,000). The disposal was due to a shift of strategy to allow the Group better manages its internal resources, including internal traffic referral and corporate allocation. The disposal was completed in January 2018 and a gain of USD 1.4 million was recognized. As part of the disposal and according to the Disposal Agreement, Xunlei agreed to assist the Buyer to collect and pay certain receivables and payables of the web game business for a period of no longer than one year after the completion of disposal. In addition, the Buyer agreed to enter into business cooperation services with Xunlei, including purchase of advertising services in the next 24 months, after signing the Disposal Agreement, under a separate negotiated term. Relevant business cooperation agreements have been signed in January 2018 at market term. Results of the discontinued operation Year ended USD (In thousands) December 31, 2018 Revenues, net of rebates and discounts 656 Business taxes and surcharges (1) Net revenues 655 Cost of revenues (16) Gross profit 639 Operating expenses Research and development expenses (419) Sales and marketing expenses (63) General and administrative expenses (18) Total operating expenses (500) Operating income 139 Gain on disposal of web game 1,394 Income tax expenses (230) Income from discontinued operations 1,303 Cash flows generated from the discontinued operation Year ended USD (In thousands) December 31, 2018 Net cash generated from operating activities 1,065 Net cash flow for the year 1,065 |
Cash and cash equivalents
Cash and cash equivalents | 12 Months Ended |
Dec. 31, 2020 | |
Cash and cash equivalents | |
Cash and cash equivalents | 5. Cash and cash equivalents Cash and cash equivalents represent cash on hand, cash held at bank, and time deposits placed with banks or other financial institutions, which have original maturities of three months or less. Cash on hand and cash held at bank balance as of December 31, 2019 and 2020 primarily consist of the following currencies: December 31, 2019 December 31, 2020 USD USD (In thousands) Amount equivalent Amount equivalent RMB 322,972 46,296 312,581 47,906 USD 115,805 115,805 89,050 89,050 Hong Kong Dollar 2,202 283 1,737 224 THB 2,417 81 2,052 68 Total 162,465 137,248 As at December 31, 2019 and 2020, included in the cash and cash equivalents are time deposits with original maturities of three months or less of USD 34,000,000 and USD 27,200,000 respectively. |
Short-term investments
Short-term investments | 12 Months Ended |
Dec. 31, 2020 | |
Short-term investments | |
Short-term investments | 6. Short-term investments (In thousands) December 31, 2019 December 31, 2020 Time deposits 102,555 68,828 Investments in financial instruments (note) 292 48,993 Total 102,847 117,821 Note: The investments were issued by commercial banks in the PRC with a variable interest rate indexed to performance of underlying assets. Since these investments’ maturity dates are within one year, they are classified as short-term investments. Time deposits and investments in financial instruments are stated on the balance sheets at the principal amount plus accrued interest. Interest income is recorded in “Other income, net” in the consolidated statements of comprehensive loss. |
Accounts receivable, net
Accounts receivable, net | 12 Months Ended |
Dec. 31, 2020 | |
Accounts receivable, net | |
Accounts receivable, net | 7. Accounts receivable, net (In thousands) December 31, 2019 December 31, 2020 Accounts receivable 35,137 32,312 Less: Allowance for credit losses (7,604) (9,329) Accounts receivable, net 27,533 22,983 The following table presents movement in the allowance for expected credit loss: (In thousands) December 31, 2018 December 31, 2019 December 31, 2020 Balance at beginning of the year 31 7,709 7,604 Additions 7,680 19 1,137 Exchange difference (2) (124) 588 Balance at end of the year 7,709 7,604 9,329 The top 10 customers accounted for about 63% and 65% of accounts receivable as of December 31, 2019 and 2020, respectively. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2020 | |
Inventories | |
Inventories | 8. Inventories (In thousands) December 31, 2019 December 31, 2020 Hardware devices (note) 9,091 4,830 Others 162 324 Less: Impairment (3,716) (3,428) Total 5,537 1,726 Note: Hardware devices mainly include OneThing Cloud and hard disks. OneThing Cloud is a hardware, which can act as a micro server between users and Xunlei, which enables users to share their idle uplink capacity with Xunlei. The inventory written down was USD 3,523,000 and USD 3,283,000 for the years ended December 31, 2019 and 2020, respectively. |
Prepayments and other current a
Prepayments and other current assets | 12 Months Ended |
Dec. 31, 2020 | |
Prepayments and other current assets | |
Prepayments and other current assets | 9. Prepayments and other current assets (In thousands) December 31, 2019 December 31, 2020 Current portion: Advance to suppliers (note a) 3,579 1,483 Receivable related to Linktoken disposal (note b) 3,536 — Interest-free loans to employees (note c) 3,185 1,896 Rental and other deposits 1,990 1,670 Proceed receivable 1,105 137 Prepayment for taxation 936 112 Prepaid management insurance 249 241 Advance to employees for business purposes 211 86 Interest receivable 4 2 Deposit related to an ongoing litigation (note d) — 4,751 Others 1,748 1,156 Total of prepayments and other current assets 16,543 11,534 Non-current portion: Low-interest loans to employees, non-current portion (note c) 313 905 Total of long-term prepayments and other assets 313 905 Notes: (a) Advances to suppliers primarily include prepayments to bandwidth suppliers. (b) In September 2018, Onething entered into a sale and purchase agreement with Beijing LinkChain to dispose of the operation and related assets and liabilities of LinkToken program. In June 2019, certain supplemental agreements were entered into with Beijing LinkChain and Hainan LinkChain, the rights and obligations related to LinkToken program was transferred to Hainan LinkChain. The receivable related to LinkToken disposal as of December 31, 2019 included the consideration receivable due from Hainan LinkChain and the amount recoverable from expenses paid on behalf of Hainan LinkChain. An impairment provision of USD 3,536,000 was recognized as of December 31, 2020, due to the deterioration of Hainan LinkChain’s operation and financial position. 9. Prepayments and other current assets (Continued) (c) The Group had entered into loan contracts with certain employees as of December 31, 2020, under which the Group provided interest-free loans or low-interest loans to these employees. The loan amounts vary amongst different employees from repayable on demand to repayable in equal installments on a monthly basis over a term of 5 to 10 years . The balances classified as current represented loan amounts that are repayable on demand or repayable within the next twelve months from the balance sheet date. (d) The balance as of December 31, 2020 represented the deposits placed in a custodian bank account of the court to secure an order for preservation of assets against a supplier of the Group. |
Long-term investments
Long-term investments | 12 Months Ended |
Dec. 31, 2020 | |
Long-term investments | |
Long-term investments | 10. Long-term investments (In thousands) December 31, 2019 December 31, 2020 Equity interests without a readily determinable fair value: Balance at beginning of the year 33,638 26,365 Additions 2,838 — Disposal (1,055) — Net unrealized gains on investments held 10,907 794 Exchange difference (132) 369 Less: impairment loss on long-term investments (19,831) (794) Balance at end of the year 26,365 26,734 Total long-term investments 26,365 26,734 Details of the Group's ownership of the long-term investments are as follows: Percentage of ownership of shares as of December 31, Investee 2019 2020 Equity method investments: Zhuhai Qianyou Technology Co., Ltd. 19.00 % 19.00 % Shenzhen Mojingou Information Services Co., Ltd. (formerly named as “Xunlei Big Data Information Service Co., Ltd.”). 28.77 % 28.77 % Equity interests without a readily determinable fair value: 9.30 % 9.30 % Shanghai Guozhi Electronic Technology Co., Ltd. 16.80 % 16.80 % Guangzhou Hongsi Network Technology Co., Ltd. 19.90 % 19.90 % Chengdu Diting Technology Co., Ltd. 12.74 % 12.74 % Xiamen Diensi Network Technology Co., Ltd. 14.25 % 14.25 % 11.2 Capital I, L.P. 2.03 % 2.03 % Cloudtropy 9.69 % 9.69 % Tianjin Kunzhiyi Network Technology Co., Ltd. (note a) 19.90 % N/A Shanghai Lexiang Technology Co., Ltd. ("Shanghai Lexiang") (note b) 13.54 % 7.81 % Hangzhou Feixiang Data Technology Co., Ltd. 28.00 % 28.00 % Shenzhen Meizhi Interactive Technology Co., Ltd. 9.40 % 9.40 % Beijing Yunhui Tianxia Technology Co., Ltd. 13.70 % 13.70 % Yingshi Innovation Technology Co., Ltd. (formerly named as “Shenzhen Arashi Vision Interactive Technology Co., Ltd.” or “Insta360”) 8.73 % 8.73 % Beijing Cloudin Technology Limited Co., Ltd. 4.12 % 4.12 % Quanxun Huiju Networking Technology (Beijing) Co., Ltd. 5.40 % 5.40 % 10. Long-term investments (Continued) Notes : (a) The company has been deregistered in May 2020. (b) In October 2020, the Group disposed 4.82% of the equity interest in Shanghai Lexiang, for which full impairment have been provided in December 2019, at a consideration of USD 268,000. The remaining equity interest in Shanghai Lexiang was remeasured based on this observable price change from the disposal, a fair value gain of USD 794,000 was recognized accordingly. The Group recognized impairment against this investment of USD 794,000 as of December 31, 2020, after considering Shanghai Lexiang’s operation performance, financial and liquidity position after the above transaction. |
Property and equipment
Property and equipment | 12 Months Ended |
Dec. 31, 2020 | |
Property and equipment | |
Property and equipment | 11. Property and equipment Property and equipment consist of the following: (In thousands) December 31, 2019 December 31, 2020 Servers and network equipment 39,130 35,827 Computer equipment 1,762 1,565 Furniture, fixtures and office equipment 806 836 Motor vehicles 406 481 Leasehold improvements 6,566 6,604 Total original costs 48,670 45,313 Less: Accumulated depreciation (28,357) (33,006) Less: Accumulated impairment (4) (3) Sub-total 20,309 12,304 Construction in progress 18,461 38,421 Total 38,770 50,725 No impairment loss was recognized for the years ended December 31, 2018, 2019 and 2020. Impairment loss of USD 6,000 and USD 1,000 has been reversed as of December 31, 2019 and December 31, 2020 due to disposal. Depreciation expense recognized for the years ended December 31, 2018, 2019 and 2020 are summarized as follows: Years ended December 31 (In thousands) 2018 2019 2020 Cost of revenues 5,018 5,198 6,247 Research and development expenses 331 300 529 General and administrative expenses 245 317 2,492 Sales and marketing expenses 1 9 9 Total 5,595 5,824 9,277 |
Right-of-use assets and lease l
Right-of-use assets and lease liabilities | 12 Months Ended |
Dec. 31, 2020 | |
Right-of-use assets and lease liabilities | |
Right-of-use assets and lease liabilities | 12. Right-of-use assets and lease liabilities The right-of-use assets represented the office lease in the Group, are amortized over the lease terms, which are greater than 1 year but less than 3 years. Right-of-use assets for long-term operating leases were as below: (In thousands) Office leases Balance at January 1, 2019 on adoption of ASC 842 Leases 11,819 Additions 3,830 Modification of operating lease (1,107) Amortization (5,634) Effect of foreign currency exchange differences (161) Net book amount at December 31, 2019 8,747 Additions 500 Modification of operating lease (3,825) Amortization (3,685) Effect of foreign currency exchange differences 217 Net book amount at December 31, 2020 1,954 During the years ended December 31, 2019 and 2020, the general and administrative expenses for long-term operating lease were USD 6,077,000 and USD 3,762,000, respectively. A charge of USD 301,000 and USD 291,000 were recognized in relation to short-term lease for the years ended December 31, 2019 and 2020. The future minimum payments under non-cancellable short-term operating leases of office rental will be USD 119,000 in 2021. The weighted average discount rate related to operating lease was 5.5% and 5.4% respectively as of December 31, 2019 and 2020, and the weighted average remaining lease term were 2 years and 1 year as of December 31, 2019 and 2020, respectively. The total cash payments in respect of operating lease was USD 5,149,000 and USD 3,797,000 for the years ended December 31, 2019 and 2020, respectively. The undiscounted cash payment for each of the next five years as of December 31, 2019 is: (In thousands) 2020 5,034 2021 3,000 2022 1,279 Total undiscounted payments 9,313 Less: effect of discounting (488) Discounted lease liabilities 8,825 The undiscounted cash payment for each of the next five years as of December 31, 2020 is: (In thousands) 2021 1,998 2022 28 Total undiscounted payments 2,026 Less: effect of discounting (38) Discounted lease liabilities 1,988 |
Intangible assets, net
Intangible assets, net | 12 Months Ended |
Dec. 31, 2020 | |
Intangible assets, net | |
Intangible assets, net | 13. Intangible assets, net December 31, 2019 December 31, 2020 Net book Net book (In thousands) Cost Amortization Impairment value Cost Amortization Impairment value Land use rights 4,769 (1,017) — 3,752 5,099 (1,258) — 3,841 Acquired computer software 2,391 (1,433) — 958 3,530 (2,853) — 677 Online game licenses 5,910 (5,193) (717) — — — — — Audio-visual license 5,621 (905) — 4,716 6,010 (1,671) — 4,339 18,691 (8,548) (717) 9,426 14,639 (5,782) — 8,857 Amortization expense recognized for the years ended December 31, 2018, 2019 and 2020 are summarized as follows: Years ended December 31 (In thousands) 2018 2019 2020 Cost of revenues 266 5 — General and administrative expenses 721 1,136 1,210 Research and development expenses 244 59 6 Total 1,231 1,200 1,216 The estimated aggregate amortization expense for each of the next five years as of December 31, 2020 is: (In thousands) Intangible assets 2021 1,107 2022 1,050 2023 1,036 2024 972 2025 and thereafter 4,692 The weighted average amortization periods of intangible assets as at December 31, 2019 and 2020 are as below: (In year) December 31, 2019 December 31, 2020 Land use rights 30 30 Acquired computer software 5 5 Online game licenses 3 — Audio-visual license 9 9 Total weighted average amortization periods 12 10 |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill. | |
Goodwill | 14. Goodwill (In thousands) December 31, 2019 December 31, 2020 Beginning balance 20,717 20,382 Addition (note) — 815 Foreign currency translation adjustment (335) 1,410 Ending balance 20,382 22,607 Note: The addition of goodwill in 2020 was related to the acquisition of Shanxian Daojia, please refer to note 3 for the acquisition. No impairment loss was recognized for the years ended December 31, 2018, 2019 and 2020. |
Contract liabilities and deferr
Contract liabilities and deferred income | 12 Months Ended |
Dec. 31, 2020 | |
Contract liabilities and deferred income | |
Contract liabilities and deferred income | 15. Contract liabilities and deferred income (In thousands) December 31, 2019 December 31, 2020 Contract liabilities (Note a) Membership subscription 29,769 31,981 Others 2,142 2,513 Other deferred income Government grants 1,300 466 Total 33,211 34,960 Less: non-current portion (Note b) (1,223) (920) Contract liabilities and deferred income, current portion 31,988 34,040 Notes: (a) Contract liabilities were related to unsatisfied performance obligations at the end of the year. Due to the generally short-term duration of the contracts, the majority of the performance obligations are satisfied in the following period. The amount of revenue recognized that was included in contract liabilities balance at the beginning of the year was USD 26,911,000 and USD 30,189,000 for the years ended December 31, 2019 and 2020, respectively. (b) As of December 31, 2019 and 2020, the non-current portion consists of membership subscription of USD 781,000 and USD 751,000, and government grants of USD 442,000 and USD 169,000, respectively. |
Accrued liabilities and other p
Accrued liabilities and other payables | 12 Months Ended |
Dec. 31, 2020 | |
Accrued liabilities and other payables | |
Accrued liabilities and other payables | 16. Accrued liabilities and other payables (In thousands) December 31, 2019 December 31, 2020 Payroll and welfare 14,995 12,871 Tax levies 4,538 3,394 Payables related to Kankan 3,733 2,581 Payables for advertisement 3,606 1,895 Legal and litigation related expenses (note 28) 2,765 1,640 Professional fees 2,714 2,106 Agency commissions and rebates—online advertising 2,521 2,696 Payables for construction in progress 1,382 5,291 Tax surcharges 1,076 1,095 Payables for technological services 778 617 Payables for gaming distribution 288 148 Deposits from customers 225 229 Payables for proceeds from selling exercised stock options and restricted shares 94 137 Payables for purchase of equipment 21 29 Others 4,104 3,960 Total 42,840 38,689 |
Bank borrowings
Bank borrowings | 12 Months Ended |
Dec. 31, 2020 | |
Bank borrowings | |
Bank borrowings | 17. Bank borrowings (In thousands) December 31, 2019 December 31, 2020 Bank borrowings 11,324 19,924 The bank borrowings were borrowed by Shenzhen Xunlei for the construction of Xunlei Building, which was pledged by the land use rights of Xunlei Building and the building under construction. The net interest expense of USD nil, USD 470,000 and USD 890,000 has been capitalized for the years ended December 31, 2018, 2019 and December 31, 2020 respectively. The bank borrowings are denominated in RMB, and the interest rate is calculated based on LPR plus 15 or 30 basis points. As of December 31, 2020, the bank borrowings will be due according to the following schedule: (In thousands) Principal amounts Within 1 year — Between 1 to 2 years — Between 2 to 3 years 747 Between 3 to 4 years 996 Between 4 to 5 years 996 Beyond 5 years 17,185 |
Common shares
Common shares | 12 Months Ended |
Dec. 31, 2020 | |
Common shares | |
Common shares | 18. Common shares The Company’s Memorandum and Articles of Association authorizes the Company to issue 1,000,000,000 shares of USD 0.00025 par value per common share as of December 31, 2020. Each common share is entitled to one vote. The holders of common shares are also entitled to receive dividends whenever funds are legally available and when declared by the Board of Directors, which is subject to the approval by the holders of the common shares representing a majority of the aggregate voting power of all outstanding shares. As of December 31, 2019 and 2020, there were 339,165,241 and 334,401,981 common shares outstanding, respectively. |
Repurchase of shares
Repurchase of shares | 12 Months Ended |
Dec. 31, 2020 | |
Repurchase of shares | |
Repurchase of shares | 19. Repurchase of shares In June 2020, the board of directors of the Company authorized a share buyback program (the "Share Buyback Program"), whereby the Company may repurchase up to USD 20 million of common shares or ADSs from June 29, 2020 for twelve months on the open market at the prevailing market prices, in privately negotiated transactions, in block trades and through other legally permissible means, depending on market conditions and in accordance with applicable rules and regulations. 19. Repurchase of shares (Continued) The following table is a summary of the shares repurchased by the Company under the Share Buyback Program. All shares were purchased through privately negotiated transactions and publicly purchasing from the open market pursuant to the Share Buyback Program: Total number of ADSs purchased as Average price Period part of the publicly announced plan paid per ADS July 8 - July 31 857,147 3.72 August 3 - August 18 334,245 3.86 Total for the year ended December 31, 2020 1,191,392 During the year ended December 31, 2020, 1,191,392 ADSs were purchased at an aggregate consideration of USD 4,475,000 under the Share Buyback Program. No shares were repurchased during the years ended December 31, 2018 and 2019. |
Share-based compensation
Share-based compensation | 12 Months Ended |
Dec. 31, 2020 | |
Share-based compensation | |
Share-based compensation | 20. Share-based compensation 2010 share incentive plan In December 2010, the Group adopted a share incentive plan, which is referred to as the 2010 Share Incentive Plan (“the 2010 Plan”). The purpose of the plan is to attract and retain the best available personnel by linking the personal interests of the members of the board, employees, and consultants to the success of the Group’s business and by providing such individuals with an incentive for outstanding performance to generate superior returns for our shareholders. Under the 2010 Plan, the maximum number of shares in respect of which share options, restricted shares, or restricted share units may be granted is 26,822,828 shares (excluding the share options previously granted to the directors who are the founders of the Company). The number of shares available for such grants as of December 31, 2020 is 11,284,463. The maximum term of any issued share option is seven (1) One-fourth of the options shall be vested upon the first anniversary of the grant date; (2) The remaining three quarters of the options shall be vested on monthly basis over the next thirty-six months. ( 1 / 48 of options shall be vested per month subsequently) Share options granted to directors were subject to a vesting schedule of approximately 32 months. All share-based payments to employees are measured based on their grant-date fair values. Compensation expense is recognized on a straight-line basis over the requisite service period. In November 2014, the Company issued to the depositary bank of 10,000,000 common shares, which were reserved for the future exercise of share options or vesting of restricted shares. 20. Share-based compensation (Continued) 2010 share incentive plan (Continued) The following table summarizes the share option activities for the years ended December 31, 2018, 2019 and 2020: Weighted Weighted Weighted- average average average remaining Aggregate Number of exercise grant-date contractual life intrinsic share options price (USD) fair value (USD) (years) value (USD) Outstanding, January 1, 2018 389,815 3.90 — 1.64 — Vested and expected to vest at January 1, 2018 389,693 3.90 0.95 1.64 — Exercisable at January 1, 2018 389,190 3.90 0.95 1.64 — Expired (373,315) 3.89 Outstanding, December 31, 2018 16,500 3.97 — 1.37 — Vested and expected to vest at December 31, 2018 16,500 3.97 1.56 1.37 — Exercisable at December 31, 2018 16,500 3.97 1.56 1.37 — Expired (6,500) 3.97 Outstanding, December 31, 2019 10,000 3.97 — 1.16 — Vested and expected to vest at December 31, 2019 10,000 3.97 1.01 1.16 — Exercisable at December 31, 2019 10,000 3.97 1.01 1.16 — Expired (10,000) 3.97 Outstanding, December 31, 2020 — — — — — Vested and expected to vest at December 31, 2020 — — — — — Exercisable at December 31, 2020 — — — — — The aggregate intrinsic value in the table above represents the difference between the estimated fair value of the Company's common shares as of December 31, 2019 and 2020 and the exercise price. As at December 31, 2019 and 2020, there were no unrecognised share-based compensation costs related to share options of 2010 Plan. In addition, the vesting schedule of the restricted shares under 2010 Plan are determined by the directors of the Company. As at December 31, 2020, 10,770,520 restricted shares (2019: 10,770,520), excluding those converted from share options, were granted to employees and officers under 2010 Plan and the unvested restricted shares granted to employees and officers vest as follows: (1) 410,000 of these restricted shares shall be vested within 2021. (2) 390,000 of these restricted shares shall be vested within 2022. (3) 390,000 of these restricted shares shall be vested within 2023. (4) 70,000 of these restricted shares shall be vested within 2024. 20. Share-based compensation (Continued) 2010 share incentive plan (Continued) A summary of the restricted shares activities under the 2010 Plan for the years ended December 31, 2018, 2019 and 2020 is presented below: Weighted-average Number of grant-date fair restricted shares value Unvested at January 1, 2018 1,272,150 Expected to vest at January 1, 2018 1,081,327 Granted 6,750,520 2.32 Vested (267,630) Forfeited (1,103,000) Unvested at December 31, 2018 6,652,040 Expected to vest at December 31, 2018 5,654,234 Granted 800,000 0.81 Vested (1,296,540) Forfeited (971,000) Unvested at December 31, 2019 5,184,500 Expected to vest at December 31, 2019 4,406,825 Vested (965,500) Forfeited (2,959,000) Unvested at December 31, 2020 1,260,000 Expected to vest at December 31, 2020 1,071,000 Forfeitures are estimated at the time of grant and are revised in subsequent periods if actual forfeitures differ from those estimates. Based upon the Company’s historical and expected forfeitures for stock options granted, the directors of the Company estimated that its future forfeiture rate would be 15% for employees and nil for directors and advisors. All restricted shares granted are measured based on their grant-date fair values. Compensation expense is recognized on a straight-line basis over the requisite service period. As of December 31, 2019 and 2020, total unrecognized compensation expense relating to the restricted shares was USD 8,981,000 and USD 2,000,000, respectively. The number of restricted shares issued to non-employees and vested as of December 31, 2019 and 2020 were both 60,000. 2013 share incentive plan In November 2013, the Group adopted a share incentive plan, which is referred to as the 2013 Share Incentive Plan (“the 2013 Plan”). The purpose of the plan is to motivate, attract and retain the best available personnel by linking the personal interests of senior officers to the success of the Group’s business. Under the 2013 Plan, the maximum number of restricted shares that may be granted is 9,073,732 shares. The vesting schedule of the restricted shares under the 2013 Plan are determined by the directors of the Company. As at December 31, 2020, 8,664,980 restricted shares (2019: 8,664,980) were granted to senior officers under the 2013 Plan and there were no unvested restricted shares under the 2013 Plan. 20. Share-based compensation (Continued) 2013 share incentive plan (Continued) A summary of the restricted shares activities under the 2013 Plan for the years ended December 31, 2018, 2019 and 2020 is presented below: Number of restricted shares Unvested at January 1, 2018 587,760 Vested (525,140) Forfeited (28,445) Unvested at December 31, 2018 34,175 Expected to vest at December 31, 2018 29,049 Unvested at January 1, 2019 34,175 Vested (27,475) Forfeited (6,700) Unvested at December 31, 2019 — Expected to vest at December 31, 2019 — Forfeitures are estimated at the time of grant and are revised in subsequent periods if actual forfeitures differ from those estimates. All restricted shares granted are measured based on their grant-date fair values. Compensation expense is recognized on a straight-line basis over the requisite service period. As of December 31, 2019 and 2020, total unrecognized compensation expense relating to the restricted shares was both nil. The number of restricted shares issued to non-employees and vested as of December 31, 2019 and 2020 were 60,000. 2014 share incentive plan In April 2014, the Group adopted a share incentive plan, which is referred to as the 2014 Share Incentive Plan (“the 2014 Plan”). The purpose of the plan is to motivate, attract and retain the best available personnel by linking the personal interests of senior management to the success of the Group’s business. Under the 2014 Plan, the maximum number of restricted shares that may be granted is 14,195,412 shares to certain officers, directors or employees of, or advisors or consultants to the Company and its subsidiaries and consolidated affiliated entities. The company issued 14,195,412 common shares to Leading Advice Holdings Limited, a company owned by the co-founder, to facilitate the administration of the 2014 Plan. The 2014 Plan was administered by the Company’s compensation committee. The vesting schedule of the restricted shares under the 2014 Plan is determined by the directors of the Company. As of December 31, 2020, 14,536,000 restricted shares (2019: 14,536,000) were granted to employees and officers under the 2014 Plan and the 26,000 unvested restricted shares granted to employees and officers shall be vested within 2021. 20. Share-based compensation (Continued) 2014 share incentive plan (Continued) A summary of the restricted shares activities under the 2014 Plan for the years ended December 31, 2018, 2019 and 2020 is presented below: Number of restricted shares Unvested at January 1, 2018 5,806,350 Vested (2,086,450) Forfeited (243,250) Unvested at December 31, 2018 3,476,650 Expected to vest at December 31, 2018 2,955,153 Unvested at January 1, 2019 3,476,650 Vested (1,318,450) Forfeited (837,000) Unvested at December 31, 2019 1,321,200 Expected to vest at December 31, 2019 1,123,020 Unvested at January 1, 2020 1,321,200 Vested (228,200) Forfeited (1,067,000) Unvested at December 31, 2020 26,000 Expected to vest at December 31, 2020 22,100 Forfeitures are estimated at the time of grant and are revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. All restricted shares granted are measured based on their grant-date fair values. Compensation expense is recognized on a straight-line basis over the requisite service period. As of December 31, 2020, the total unrecognized compensation expense relating to the restricted shares was USD 12,000 (2019: USD 766,000). 2020 share incentive plan In June 2020, the Group terminated its 2010 Plan, 2013 Plan and 2014 Plan (the “Existing Plans”) and adopted a 2020 share incentive plan, which is referred to as the 2020 Share Incentive Plan (“the 2020 Plan”). Under the 2020 Plan, the maximum aggregate number of shares of the Company that may be granted is 31,000,000. Upon termination of the Existing Plans, the awards that are granted and outstanding under the Existing Plans remain effective under the 2020 Plan, subject to any amendment and modification to the original award agreements that the Company shall determine. As of December 31, 2020, no shares have been granted under the 2020 Plan. 20. Share-based compensation (Continued) 2020 share incentive plan (Continued) Total compensation costs recognized for the years ended December 31, 2018, 2019 and 2020 are as follows: Years ended December 31, (In thousands) 2018 2019 2020 Sales and marketing expenses 404 381 185 General and administrative expenses 2,245 2,453 1,209 Research and development expenses 2,645 2,594 916 Total 5,294 5,428 2,310 |
Non-controlling interests
Non-controlling interests | 12 Months Ended |
Dec. 31, 2020 | |
Non-controlling interests | |
Non-controlling interests | 21. Non-controlling interests Non-controlling interests are recognized to reflect the portion of the equity of majority-owned subsidiaries and VIE's which is not attributable, directly or indirectly, to the controlling shareholder. The non-controlling interests in the Company's consolidated financial statements consist primarily of the non-controlling interests in Xunlei Games, Thailand Onething and Henan Tourism. |
Cost of revenues
Cost of revenues | 12 Months Ended |
Dec. 31, 2020 | |
Cost of revenues | |
Cost of revenues | 22. Cost of revenues Years ended December 31, Cost of revenues from continuing operations (In thousands) 2018 2019 2020 Bandwidth costs 48,118 57,093 62,384 Cost of inventories sold 31,634 7,181 1,660 Cost of live streaming 23,928 20,734 15,640 Depreciation of servers and other equipment 5,018 5,198 6,247 Payment handling charges 3,016 1,658 1,459 Other costs (note) 3,953 8,049 5,247 Total 115,667 99,913 92,637 Note: Other costs mainly included write-down of inventories. |
Other income, net
Other income, net | 12 Months Ended |
Dec. 31, 2020 | |
Other income, net | |
Other income, net | 23. Other income, net Continuing Operations Years ended December 31, (In thousands) 2018 2019 2020 Government subsidy income 2,096 2,061 2,287 Investment income from short-term investments 5,817 4,020 2,943 Net unrealized gains arising from long-term investments — 10,907 794 Investment income on disposal of long-term investments — 579 214 Impairment of long-term investments (7,794) (19,831) (794) Exchange gain/(loss), net 1,216 (402) (2,948) Settlement income 414 1,531 — Gains from disposal of Linktoken program — 6,630 — Value-added tax deduction — 427 1,361 Others 1,061 (61) 880 Total 2,810 5,861 4,737 |
Taxation
Taxation | 12 Months Ended |
Dec. 31, 2020 | |
Taxation | |
Taxation | 24. Taxation (i) Cayman Islands Under the current laws of the Cayman Islands, the Company is not subject to tax on income or capital gains. Additionally, upon payment of dividends by the Company to its shareholders, no Cayman Islands withholding tax will be imposed. (ii) PRC Enterprise Income Tax (“EIT”) The PRC enterprise income tax is calculated based on the taxable income determined under the PRC laws and accounting standards. Under the Enterprise Income Tax (“EIT”) Law, foreign invested enterprises and domestic enterprises are subject to a unified EIT rate of 25%. In accordance with the implementation rules of the EIT Law, a qualified “High and New Technology Enterprise” (“HNTE”) is eligible for a preferential tax rate of 15%, a “Software Enterprise” (“SE”) is entitled exemption from income taxation for the first two years, counting from the first profitable year, and reduction by half for the next three years, and a certified National Key Software Enterprise (“NKSE”) is entitled a preferential tax rate of 10%. Shenzhen Xunlei, Wangwenhua and Xunlei Computer have been recognized as HNTE and entitled to preferential tax rate of 15%for the years ended December 31, 2018, 2019 and 2020. Onething has been recognized as HNTE and entitled to preferential tax rate of 15% for the years ended December 31, 2018 and 2019. Onething continued to adopt a preferential tax rate of 15% for the year ended December 31, 2020, as it was established in Qianhai Shenzhen-Hongkong Modern Service Industry Cooperation Zone and met the requirements set out by local authorities for the preferential tax rate. According to a policy of the PRC State Tax Bureau, enterprises that engage in research and development activities are entitled to claim 175% of the research and development expenses incurred in a year as tax deductible expenses in determining their tax assessable profits for that year (“Super Deduction”). The other PRC subsidiaries and consolidated VIEs are subject to a 25% EIT rate. In addition, according to the EIT Law and its implementation rules, foreign enterprises, which have no establishment or place in the PRC but derive dividends, interest, rents, royalties and other income (including capital gains) from sources in the PRC are subject to PRC withholding tax, or WHT, at 10% (a further reduced WHT rate may be available according to the applicable double tax treaty or arrangement). The 10% WHT is generally applicable to any dividends to be distributed from Giganology Shenzhen and Xunlei Computer to the Company out of any profits of Giganology Shenzhen and Xunlei Computer derived after January 1, 2008. Up to December 31, 2020, both Giganology Shenzhen and Xunlei Computer did not declare any dividend to the parent company and have determined that they have no present plan to declare and pay any dividends. The Group currently plans to continue to reinvest its subsidiaries’ undistributed earnings, if any, in its operations in China indefinitely. Accordingly, no withholding income tax was accrued or required to be accrued for the years ended December 31, 2018, 2019 and 2020. Moreover, the current EIT Law treats enterprises established outside of China with “effective management and control” located in the PRC as PRC resident enterprises for tax purposes. The term “effective management and control” is generally defined as exercising overall management and control over the business, personnel, accounting, properties, etc. of an enterprise. The Company, if considered a PRC resident enterprise for tax purposes, would be subject to the PRC EIT at the rate of 25% on its worldwide income for the period after January 1, 2008. As of December 31, 2019 and 2020, the Company has not accrued for PRC tax on such basis. The Company will continue to monitor its tax status. 24. Taxation (Continued) (ii) PRC Enterprise Income Tax (“EIT”) (Continued) The current and deferred portions of income tax expense included in the consolidated statements of operations are as follows: Continuing operations Years ended December 31, (In thousands) 2018 2019 2020 Current income tax (benefits)/expenses (471) 315 183 Deferred income tax expenses 382 4,361 966 Income tax (benefits)/expenses (89) 4,676 1,149 The aggregate amount and per share effect of the tax holidays and concession are as follows: Years ended December 31, 2018 2019 2020 Aggregate dollar effect (In thousands) (3,776) (3,856) 197 Per share effect—basic (0.01) (0.01) (0.00) Per share effect—diluted (0.01) (0.01) (0.00) The reconciliation of total tax (benefits)/expenses computed by applying the respective statutory income tax rates to pre-tax loss is as follows: Continuing operations Years ended December 31, (In thousands) 2018 2019 2020 Income tax benefit at PRC statutory rate (based on statutory tax rate applicable to enterprises in China) (10,384) (11,886) (3,736) Effects of differences in tax rates in different jurisdictions applicable to entities of the Group outside of the PRC 485 788 787 Non-deductible expenses 245 228 101 Effect of Super Deduction (881) (1,920) (733) Effect of tax holidays and tax concessions 3,776 3,856 (197) Change in valuation allowance of deferred tax assets 6,720 13,180 4,704 Effect on deferred tax assets due to change in tax rates (167) — — Expiration of tax loss 562 400 84 Others (445) 30 139 Income tax (benefits)/expenses (89) 4,676 1,149 24. Taxation (Continued) (ii) PRC Enterprise Income Tax (“EIT”) (Continued) The tax effects of temporary differences that give rise to the deferred tax assets and liabilities balances of December 31, 2019 and 2020 are as follows: (In thousands) December 31, 2019 December 31, 2020 Deferred tax assets: Net operating losses carried forward (note a) 27,712 32,458 Impairment of long-term equity investments 4,061 4,233 Impairment of other receivables 1,553 1,858 Impairment of accounts receivable 1,140 1,451 Impairment of inventories 549 540 Allowance for advance to suppliers 346 369 Impairment of property and equipment 14 15 Valuation allowance (34,257) (40,924) Deferred tax assets, net (note b) 1,118 — Deferred tax liabilities: Deferred credit arising from an asset acquisition (1,179) (1,085) Notes: (a) As of December 31, 2020, the accumulated net operating loss of USD 3,079,000 of the Group’s subsidiaries incorporated in Hong Kong can be carried forward indefinitely to offset future taxable income, the remaining accumulated net operating loss of USD 179,797,000 mainly arose from the Company’s subsidiaries and consolidated VIEs established in the PRC, which can be carried forward to offset future taxable income and will expire during the period from 2021 to 2030. (b) As of December 31, 2019 and 2020, the deferred tax assets and liabilities balances are expected to be recoverable as follows: Deferred tax assets (In thousands) 2019 2020 Within one year 133 — After one year 985 — 1,118 — Deferred tax liabilities (In thousands) 2019 2020 Within one year (165) (176) After one year (1,014) (909) (1,179) (1,085) 24. Taxation (Continued) (ii) PRC Enterprise Income Tax (“EIT”) (Continued) Movement of valuation allowance is as follows: Years ended December 31, (In thousands) 2018 2019 2020 Beginning balance (16,599) (20,181) (34,257) Additions (6,720) (13,180) (4,704) Exchange difference 3,138 (896) (1,963) Ending balance (20,181) (34,257) (40,924) In 2018, valuation allowance was provided for net operating loss carryforwards of Onething, Xunlei Games, Beijing Xunjing and Crystal Interactive because it was more likely than not that such deferred tax assets will not be realized based on the Group's estimate of their future taxable income, and the fact that the these entities were not included in the tax strategy plan. In 2019 and 2020, valuation allowance was provided for net operating loss carryforwards of the Group because it was more likely than not that such deferred tax assets will be realized based on the Group's estimate of future taxable income of those companies. As of December 31, 2020, the tax returns of the Group’s subsidiaries, VIE and its subsidiaries since their respective dates of incorporation are still open to examination. |
Basic and diluted net loss per
Basic and diluted net loss per share | 12 Months Ended |
Dec. 31, 2020 | |
Basic and diluted net loss per share | |
Basic and diluted net loss per share | 25. Basic and diluted net loss per share Basic and diluted net loss per share for the years ended December 31, 2018, 2019 and 2020 are calculated as follows: (Amounts expressed in thousands of USD, except for number of shares and per Years ended December 31, share data) 2018 2019 2020 Numerator: Net loss from continuing operations (40,793) (53,415) (14,140) Net income from discontinued operations 1,303 — — Net loss (39,490) (53,415) (14,140) Less: Net loss attributable to the non-controlling interest (212) (246) (300) Net loss attributable to Xunlei Limited’s common shareholders (39,278) (53,169) (13,840) Numerator of basic net loss per share from continuing operations (40,581) (53,169) (13,840) Numerator of basic net income per share from discontinued operations. 1,303 — — Numerator for diluted loss per share from continuing operations (40,581) (53,169) (13,840) Numerator for diluted income per share from discontinued operations 1,303 — — Denominator: Denominator for basic net loss per share-weighted average shares outstanding 334,965,987 337,845,675 337,429,601 Denominator for diluted net loss per share 334,965,987 337,845,675 337,429,601 Basic net loss per share from continuing operations (0.12) (0.16) (0.04) Basic net income per share from discontinued operations 0.00 N/A N/A Diluted net loss per share from continuing operations (0.12) (0.16) (0.04) Diluted net income per share from discontinued operations 0.00 N/A N/A All potentially dilutive securities were not included in the calculation of dilutive net income per share for the years ended December 31, 2018, 2019 and 2020 as their effects would be anti-dilutive. |
Related party transactions
Related party transactions | 12 Months Ended |
Dec. 31, 2020 | |
Related party transactions | |
Related party transactions | 26. Related party transactions The table below sets forth the related parties and their relationships with the Group: Related Party Relationship with the Group Chuan Wang Chairman and director of the Company (note i) Shenglong Zou Co-founder, director and shareholder of the Company Weimin Luo Director and Chief Operating Officer of the Company Shenzhen Crystal Technology Co., Ltd. ("Shenzhen Crystal”) Company owned by a co-founder and director of the Company Vantage Point Global Limited Shareholder of the Company Aiden & Jasmine Limited Shareholder of the Company Millet Technology Co., Ltd. (“Xiaomi Technology”) Note ii Millet Communication Technology Co., Ltd. (“Millet Communication Technology”) Note ii Beijing Xiaomi Mobile Software Co., Ltd. (“Beijing Xiaomi Mobile Software”) Note ii Beijing Millet Payment Technologies Co., Ltd. (“Beijing Millet Payment Technologies”) Note ii Guangzhou Millet Information Service Co., Ltd. (“Guangzhou Millet”) Note ii Shenzhen Xiaomi Technology Co., Ltd. (“Shenzhen Xiaomi”) Note ii Beijing Itui Company owned by the principal shareholder of the Company (note iii) Beijing Itui Online Network Technology Co., Ltd. (“Itui Online”) Company owned by the principal shareholder of the Company (note iii) 26. Related party transactions (Continued) Note: (i) Chuan Wang has resigned from the board on April 2, 2020. (ii) Prior to April 2, 2020, these companies were related companies to the Company as they were affiliated companies of a shareholder of the Company, Xiaomi Ventures Limited (“Xiaomi Ventures”). On April 2, 2020, Xiaomi Ventures ceased to be the shareholder of the Company as Xiaomi Ventures together with certain shareholders of the Company exchanged their common shares of the Company for the shares of Itui International Inc. (“Itui”). In addition, Xiaomi Ventures entitled to certain veto rights in determining Itui’s voting on the Company. As a result, Xiaomi Ventures and the companies controlled by Xiaomi Ventures continued to be related parties of the Company. (iii) These companies become related parties of Xunlei since April 2, 2020. During the years ended December 31, 2018, 2019 and 2020, significant related party transactions were as follows: Years ended December 31, (In thousands) 2018 2019 2020 Game sharing costs paid and payable to an investee company 9 — — Bandwidth revenue from Beijing Xiaomi Mobile Software (note a) 4,254 1,815 — Bandwidth revenue from Xiaomi Technology (note a) — 875 2,211 Forum service fees paid and payable to Xiaomi Technology (note b) 38 13 — Advertisement revenue from Guangzhou Millet (note c) — 19 — Technology service revenue from Guangzhou Millet (note d) 3,932 2,460 2,466 Advertisement revenue from Shenzhen Xunyi (note e) 493 — — Bandwidth revenue from Shenzhen Xunyi (note e) 160 — — Accrued to Vantage Point Global Limited (note f) 146 46 243 Accrued to Aiden & Jasmine Limited (note f) 54 17 91 Advertisement revenues from Beijing Itui (note g) — — 7,269 Bandwidth revenues from Itui Online (note h) — — 1,119 Bandwidth cost from an investee company — — 594 Advertisement revenue from Shenzhen Xiaomi (note i) — — 53 Repayment of loans to Weimin Luo arising from a business combination (note 3) — — 662 26. Related party transactions (Continued) Notes: (a) From July 2017 to July 2019, Onething entered into a contract with Beijing Xiaomi Mobile Software for the provision of bandwidth to Beijing Xiaomi Mobile Software at a price benchmarking against market price, based on actual usage. From August 2019 till now, Onething entered into the contract with Xiaomi Technology for the provision of bandwidth to Xiaomi Technology at a price benchmarking against market price, based on actual usage. (b) Onething Cloud devices were available for sale on the online platform operated by Xiaomi Technology starting from August 2018 till April 2019, during which Xiaomi Technology was entitled to receive service fees based on a certain percentage of sales on the platform. (c) From 2017, an advertising services contract was entered into with Guangzhou Millet at a price benchmarking against market price. (d) The Group is entitled to receive a mutually agreed sharing of net advertising revenue covering a period from mid-June 2017 to mid-June 2019, as compensation for technology solution services provided to Guangzhou Millet. The contract was extended for two years from mid-June 2019 to mid-June 2021 based on the same term. (e) In 2018, a sales contract was entered into with Shenzhen Xunyi for provision of bandwidth and advertising services at a price benchmarking against market price, based on actual usage. (f) In 2014, the Group repurchased 3,860,733 common shares from Aiden & Jasmine Limited (Co founder’s company) for USD10,879,000 and 10,334,679 common shares from Vantage Point Global Limited for USD29,121,000. According to the repurchase contract, the Company was entitled to an amount (the “Withheld Price”) to withhold any taxes with respect to this repurchase as required under the applicable laws. If the Seller has not been specifically required by the applicable governmental or regulatory authority to pay any taxes as required under the applicable laws in connection with the repurchase, after the fifth anniversary of the Closing Date, the Company will pay to the Seller the Withheld Price with a simple interest thereon at the rate of five percent (5%) per annum from the Closing Date. Therefore, the Withheld Price for Aiden & Jasmine Limited and Vantage Point Global Limited was USD 1,451,000 (including interest of USD 363,000) and USD 3,883,000 (including interest of USD 971,000) respectively. The interest accrued for the year ended December 31, 2020 was USD 91,000 and USD 243,000 for Aiden & Jasmine Limited and Vantage Point Global Limited respectively. The Group has repaid USD 3,883,000 to Vantage Point Global Limited in January 2021. (g) In 2020, an user traffic monetization agreement was entered into with Beijing Itui, according to which Xunlei is entitled to receive a mutually agreed sharing of net advertising revenue covering a period from mid-May 2020 to mid-May 2021. (h) The Company entered into a sales contract with Itui Online for provision of bandwidth at a price benchmarking against market price and charged based on actual usage since 2019. (i) In 2020, a user traffic monetization agreement was entered into with Shenzhen Xiaomi, according to which Xunlei is entitled to receive a mutually agreed sharing of net advertising revenue 26. Related party transactions (Continued) As of December 31, 2019 and 2020, the amounts due from/to related parties were as follows: (In thousands) December 31, 2019 December 31, 2020 Amounts due from related parties Accounts receivable from Guangzhou Millet 1,361 1,456 Accounts receivable from Xiaomi Technology 262 576 Accounts receivable from Itui Online — 1,153 Accounts receivable from Beijing Itui — 7,689 Accounts receivable from Shenzhen Xiaomi — 60 Other receivable from Xiaomi Technology 14 15 Other receivable from Shenzhen Crystal 6 6 Other receivable from Shenglong Zou 9 9 Other receivable from Chuan Wang 6 6 (In thousands) December 31, 2019 December 31, 2020 Amounts due to related parties Accounts payable to investee companies 2 55 Other payable to Vantage Point Global Limited 3,640 3,883 Other payable to Aiden & Jasmine Limited 1,360 1,451 |
Fair value measurements
Fair value measurements | 12 Months Ended |
Dec. 31, 2020 | |
Fair value measurements | |
Fair value measurements | 27. Fair value measurements ASC 820-10 establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1—Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets Level 2—Include other inputs that are directly or indirectly observable in the marketplace or based on quoted price in markets that are not active Level 3—Unobservable inputs which are supported by little or no market activity and are significant to the overall fair value measurement ASC 820-10 describes three main approaches to measuring the fair value of assets and liabilities: (1) market approach; (2) income approach and (3) cost approach. The market approach uses prices and other relevant information generated from market transactions involving identical or comparable assets or liabilities. The income approach uses valuation techniques to convert future amounts to a single present value amount. The measurement is based on the value indicated by current market expectations about those future amounts. The cost approach is based on the amount that would currently be required to replace an asset. 27. Fair value measurements (Continued) The following table sets forth the financial instruments, measured at fair value, by level within the fair value hierarchy as of December 31, 2019 and 2020. Fair value measurements as at December 31, 2019 Quoted prices Significant in active market other Significant for identical observable unobservable assets inputs inputs (In thousands) Total (Level 1) (Level 2) (Level 3) Short term investments: Investments in financial instruments 292 — 292 — 292 — 292 — Fair value measurements as at December 31, 2020 Quoted prices Significant in active market other Significant for identical observable unobservable assets inputs inputs (In thousands) Total (Level 1) (Level 2) (Level 3) Short term investments: Investments in financial instruments 48,993 — 48,993 — 48,993 — 48,993 — Investments in privately held companies for which the Company elected to record using the measurement alternative are re-measured on a non-recurring basis, and are categorized within Level 3 under the fair value hierarchy. The values are estimated based on valuation methods using the observable transaction price at the transaction date and other unobservable inputs including volatility, as well as rights and obligations of the securities. |
Commitments and contingencies
Commitments and contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and contingencies | |
Commitments and contingencies | 28. Commitments and contingencies Bandwidth purchase commitments The Group purchase bandwidth in the PRC under non-cancellable contract expiring on different dates. Payments under purchase of bandwidth are expensed on a straight-line basis over the duration of the respective periods. Future minimum payments under non-cancellable bandwidth contracts consist of the following as of December 31, 2020: (In thousands) 2021 3,388 2022 406 3,794 28. Commitments and contingencies (Continued) Capital commitments As at December 31, 2020, the Group has unconditional purchase obligations for office software and construction in progress that had not been recognized in the amount of USD 7,953,000. (In thousands) 2021 7,040 2022 — 2023 913 7,953 Litigation The Group is involved in a number of cases pending in various courts. These cases are substantially related to alleged copyright infringement as well as routine and incidental matters to its business, among others. Adverse results in these lawsuits may include awards of damages and may also result in, or even compel, a change in the Group’s business practices, which could impact the Group’s future financial results. The Group had incurred USD 4,667,000 and USD 1,955,000 legal and litigation related expenses for the years ended December 31, 2018 and 2019, respectively, while the Group had reversed USD 1,217,000 legal expense for the year ended December 31, 2020. Up to April 26, 2021, which is the date when the consolidated financial statements were issued, the Group had 16 lawsuits pending against the Group with an aggregate amount of claimed damages of approximately RMB 13.3 million (USD 1.9 million) which occurred before December 31, 2020 (2019: RMB 82.0 million (USD 11.9 million)). Of the 16 pending lawsuits, 13 lawsuits were relating to the alleged copyright infringement in the PRC. The Group had accrued for USD 1,640,000 litigation related expenses in ‘‘Accrued liabilities and other payables’’ in the consolidated balance sheet as of December 31, 2020 (2019: USD 2,765,000), which is the most probable and reasonably estimable outcome. The Group estimated the litigation compensation based on judgments handed down by the court, out-of-court settlements of similar cases as well as advices from the Group’s legal counsels. The Group is in the process of appealing certain judgments for which the losses had been accrued. Although the results of unsettled litigation and claims cannot be predicted with certainty, the Group does not expect that the outcome of the 16 lawsuits will result in the amounts accrued materially different from the range of reasonably possible losses. In the opinion of management, there was not at least a reasonable possibility the Company may have incurred a material loss, or a material loss in excess of a recorded accrual, with respect to loss contingencies for asserted legal and other claims. However, the outcome of litigation is inherently uncertain. If one or more of these legal matters were resolved against the Company in a reporting period for amounts in excess of management’s expectations, the Company’s consolidated financial statements for that reporting period could be materially adversely affected. In May 2014, the Group entered into a content protection agreement with the Motion Picture Association of America, Inc., or MPAA, and its members, which are six major U.S. entertainment content providers. In that agreement, the Group agreed to implement a comprehensive system of measures designed to prevent unauthorized downloading of and access to such content providers’ works. Despite the fact that the Group put in place preventive measures, the Group may still be subject to copyright infringement suits. In January 2015, a number of MPAA member studios filed 28 copyright infringement lawsuits against the Group on 28 video products in the Shenzhen Nanshan District Court in China. The court combined these cases into two cases for trial and entered a judgment on both cases on August 21, 2017. The court held, among others, that the Group infringed the plaintiffs’ copyright on 28 video products and were required by the court to compensate the plaintiff for a total of RMB 1.4 million (USD 0.2 million), the compensation costs was paid by the Group in 2018. 28. Commitments and contingencies (Continued) Litigation (Continued) In addition, two putative shareholder class action lawsuits have been filed in the United States District Courts for the Southern District of New York against the Company and certain current and former officers and directors of the Company. Purporting to sue on behalf of all investors who purchased or acquired Xunlei stock from October 10, 2017 to January 11, 2018, plaintiffs allege that certain statements regarding OneCoin, later renamed as LinkToken, in the Company’s press releases and on a quarterly investor call were false and misleading because, among other things, they failed to disclose that OneCoin was a disguised “initial coin offering” and “initial miner offering” and constituted “unlawful financial activity.” Plaintiffs seek to recover under Sections 10(b) and 20(a) of the U.S. Securities Exchange Act of 1934 and Rule 10b-5 thereunder. On April 12, 2018, the court consolidated the actions under the caption In re Xunlei Limited Securities Litigation |
Certain risks and concentration
Certain risks and concentration | 12 Months Ended |
Dec. 31, 2020 | |
Certain risks and concentration | |
Certain risks and concentration | 29. Certain risks and concentration PRC regulations Current PRC laws and regulations place certain restrictions on foreign ownership of companies that engage in internet businesses, including the provision of online video and online advertising services. Specifically, foreign ownership in an internet content provider or other value-added telecommunication service providers may not exceed 50%. The Group conducts its operations in China principally through contractual arrangements among Giganology Shenzhen, its wholly owned PRC subsidiary, and Shenzhen Xunlei and its shareholders. Shenzhen Xunlei holds the licenses and permits necessary to conduct its resource discovery network, online advertising, online games and related businesses in China and hold various operating subsidiaries that conduct a majority of its operations in China. The Company conducts all of its operations in China through, Shenzhen Xunlei, a variable interest entity, which it consolidates as a result of a series contractual arrangements enacted. If the Company had direct ownership of Shenzhen Xunlei, it would be able to exercise its rights as a shareholder to effect changes in the board of directors of Shenzhen Xunlei, which in turn could effect changes at the management level, subject to any applicable fiduciary obligations. However, under the current contractual arrangements, it relies on Shenzhen Xunlei and its shareholders’ performance of their contractual obligations to exercise effective control. In addition, its operating contract with Shenzhen Xunlei has a term of ten years, which is subject to Giganology Shenzhen’s unilateral termination right. None of Shenzhen Xunlei or its shareholders may terminate the contracts prior to the expiration date. 29. Certain risks and concentration (Continued) PRC regulations (Continued) Further, the Group believes that the contractual arrangements among Giganology Shenzhen, Shenzhen Xunlei and its shareholders are in compliance with PRC law and are legally enforceable. However, the Chinese government may issue from time to time new laws or new interpretations on existing laws to regulate this industry. Regulatory risk also encompasses the interpretation by the tax authorities of current tax laws, and the Group’s legal structure and scope of operations in the PRC, which could be subject to further restrictions resulting in limitations on the Company’s ability to conduct business in the PRC. The PRC government may also require the Company to restructure the Group’s operations entirely if it finds that its contractual arrangements do not comply with applicable laws and regulations. Furthermore, it could revoke the Group’s business and operating licenses, require it to discontinue or restrict its operations, restrict its right to collect revenues, block its website, require it to restructure its operations, impose additional conditions or requirements with which the Group may not be able to comply, or take other regulatory or enforcement actions against the Group that could be harmful to its business. The imposition of any of these penalties may result in a material and adverse effect on the Group’s ability to conduct the Group’s business. In addition, if the imposition of any of these penalties causes the Group to lose the rights to direct the activities of the VIE and its subsidiaries or the right to receive their economic benefits, the Group would no longer be able to consolidate the VIE. The Group does not believe that any penalties imposed or actions taken by the PRC Government would result in the liquidation of the Company, Giganology Shenzhen or Shenzhen Xunlei. As stated above, Shenzhen Xunlei holds assets that are important to the operation of the Group’s business, including patents for proprietary technology, related domain names and trademarks. If Shenzhen Xunlei or its subsidiaries falls into bankruptcy and all or part of its assets become subject to liens or rights of third-party creditors, the Group may be unable to conduct its business activities in China, which could have a material adverse effect on the Group’s future financial position, results of operations or cash flows. However, the Group believes this is a normal business risk many companies face. The Group will continue to closely monitor the financial conditions of Shenzhen Xunlei and its subsidiaries. Shenzhen Xunlei and its subsidiaries’ assets comprise both recognized and unrecognized revenue-producing assets. The recognized revenue-producing assets include intangible assets, purchased property and equipment. The balances of these assets held by the VIE and its subsidiaries are included in “property and equipment, net” and “intangible assets, net” in the consolidated balance sheet and specifically in the VIE table on the following page. The unrecognized revenue-producing assets mainly consist of license, patents, trademarks, and domain names which are not recorded in the financial statement as they did not meet the recognition criteria set in ASC 350-30-25. The licenses stated above primarily consist of licenses that grant the VIE and its subsidiaries the right to produce and broadcast internet, radio, and television programs. One of them is the ICP licenses as described in note 1. As of December 31, 2020, Shenzhen Xunlei and its subsidiaries held patents granted in the PRC and in the United States. Presently, certain patent applications are being examined by the State Intellectual Property Office of the PRC. As of December 31, 2020, Shenzhen Xunlei and its subsidiaries have applied to register trademarks, of which the Company has received registered trademarks in different applicable trademark categories including registered with World Intellectual Property Organization. 29. Certain risks and concentration (Continued) PRC regulations (Continued) The following consolidated financial information of the Group’s VIE and its subsidiaries from continuing operations was included in the accompanying consolidated financial statements, before elimination of balances with the Company and its subsidiaries, as of and for the years ended: As of December 31, (In thousands) 2019 2020 Current assets: Cash and cash equivalents 34,847 14,284 Short-term investments 292 — Accounts receivable, net 30,686 32,485 Due from related parties 1,644 10,955 Inventories 5,330 1,726 Prepayments and other current assets 20,747 15,712 Total current assets 93,546 75,162 Non-current assets: Long-term investments 5,337 5,706 Deferred tax assets 985 — Property and equipment, net 38,417 50,532 Intangible assets, net 9,426 8,857 Goodwill 20,382 22,607 Other long-term prepayments and non-current assets 313 905 Right-of-use assets 8,619 1,915 Restricted cash 2,983 1,541 Total non-current assets 86,462 92,063 Total assets 180,008 167,225 Current liabilities: Accounts payable (including inter-companies balances with the Company and its subsidiaries of USD 21,297 and USD 30,439 as of December 31, 2019 and 2020, respectively (note a)) 45,162 51,027 Due to a related party 2 55 Contract liabilities and deferred income, current portion 31,988 34,040 Income tax payable 2,436 2,500 Accrued liabilities and other payables (including inter-companies balances with the Company and its subsidiaries of USD 152,904 and USD 152,611 as of December 31, 2019 and 2020, respectively (note b)) 191,406 185,972 Lease liabilities, current portion 4,621 1,912 Total current liabilities 275,615 275,506 Non-current liabilities: Contract liabilities and deferred income, non-current portion 1,223 920 Deferred tax liabilities 1,179 1,085 Lease liabilities, non-current portion 4,073 27 Bank borrowings 11,324 19,924 Total non-current liabilities 17,799 21,956 Total liabilities 293,414 297,462 29. Certain risks and concentration (Continued) PRC regulations (Continued) Notes: (a) Excluding the inter-companies balances with the Company and its subsidiaries of USD 21,297,000 and USD 30,439,000 , the balance of accounts payable as of December 31, 2019 and 2020, was USD 23,865,000 and USD 20,588,000 , respectively. (b) Excluding the inter-companies balances with the Company and its subsidiaries of USD 152,904,000 and USD 152,611,000 , the balance of accrued liabilities and other payables as of December 31, 2019 and 2020 was USD 38,502,000 and USD 33,361,000 , respectively. Years ended December 31, (In thousands) 2018 2019 2020 Net revenues from continuing operations 231,616 177,520 186,413 Net loss attributable to Xunlei Limited (40,728) (56,328) (10,673) Years ended December 31, (In thousands) 2018 2019 2020 Net cash provided by/(used in) operating activities 7,548 (16,047) (21,008) Net cash used in investing activities (7,925) (5,001) (9,160) Net cash provided by financing activities 2,096 11,707 7,154 1,719 (9,341) (23,014) Foreign exchange risk The Group’s financing activities are denominated mainly in USD. The RMB is not freely convertible into foreign currencies. Remittances of foreign currencies into the PRC and exchange of foreign currencies into the RMB require approval by foreign exchange administrative authorities and certain supporting documentation. The State Administration for Foreign Exchange, under the authority of the People’s Bank of China, controls the conversion of RMB into other currencies. The revenues and expenses of the Company’s subsidiaries, consolidated VIE and its subsidiaries are generally denominated in RMB and their assets and liabilities are denominated in RMB. Concentration of customer risk The top 10 customers accounted for 23%, 31% and 38% of the net revenues for the years ended December 31, 2018, 2019 and 2020, respectively. Credit risk As of December 31, 2019 and 2020, substantially all of the Group’s cash and cash equivalents, restrict cash and short-term investments were held at reputable financial institutions in the jurisdictions where the Group and its subsidiaries are located. The Group believes that it is not exposed to unusual risks as these financial institutions have high credit quality. The Group has not experienced any losses on its deposits of cash and cash equivalents, restricted cash and short-term investments. Prior to entering into sales agreements, the Group performs ongoing credit assessments of its customers, taking into account their financial position, credit history and other factors such as current market conditions. Further, the Group has not experienced any significant bad debts with respect to its accounts receivable for the years ended December 31, 2019 and 2020, the addition of allowance for doubtful accounts for the year ended December 31, 2018 was mainly arisen from the cloud computing service to a customer. 29. Certain risks and concentration (Continued) Credit risk (Continued) The Group is exposed to credit risk in relation to other assets comprised of due from related parties and other receivables, which are typically unsecured. In evaluating the collectability of the balances, the Group considered various factors, including the related parties and third parties’ repayment history and their credit-worthiness. An allowance for credit losses is made when collection of the full amount is no longer probable. Restricted net assets Relevant PRC laws and regulations permit payments of dividends by the Company’s subsidiaries, VIE and VIE’s subsidiaries in China only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. In addition, the Company’s subsidiaries, VIE and VIE’s subsidiaries in China are required to make certain appropriation of net after-tax profits or increase in net assets to the statutory surplus fund (see note 2(bb)) prior to payment of any dividends. As a result of these and other restrictions under PRC laws and regulations, the Company’s subsidiaries, VIE and VIE’s subsidiaries in China are restricted in their ability to transfer their net assets to the Company in terms of cash dividends, loans or advances, which restricted portion amounted to USD 168,493,000 as of December 31, 2020, or 58% of the Company's total consolidated net assets. Even though the Company currently does not require any such dividends, loans or advances from the PRC subsidiaries, VIE and VIE’s subsidiaries for working capital and other funding purposes, the Company may in the future require additional cash resources from the Company’s subsidiaries, VIE and a VIE’s subsidiaries in China due to changes in business conditions, to fund future acquisitions and development, or merely to declare and pay dividends to make distributions to shareholders. |
Subsequent events
Subsequent events | 12 Months Ended |
Dec. 31, 2020 | |
Subsequent events | |
Subsequent events | 30. Subsequent events The Company performed an evaluation of subsequent events through April 26, 2021, which is the date the financial statements were issued, and did not identify any material events or transactions that would require adjustment to or disclosure in the financial statements. |
Additional information_ condens
Additional information: condensed financial statements of the Company | 12 Months Ended |
Dec. 31, 2020 | |
Additional information: condensed financial statements of the Company | |
Additional information: condensed financial statements of the Company | 31. Additional information: condensed financial statements of the Company Regulation S-X requires condensed financial information as to financial position, statements of cash flows and results of operations of a parent company as of the same dates and for the same periods for which audited consolidated financial statements have been presented when the restricted net assets of consolidated and unconsolidated subsidiaries together exceed 25 percent of consolidated net assets as of the end of the most recently completed fiscal year. The Company records its investment in its subsidiaries, VIE and VIE’s subsidiaries under the equity method of accounting. Such investments are presented on the separate condensed balance sheets of the Company as “long-term investments”. The subsidiaries did not pay any dividends to the Company for the periods presented. Certain information and footnote disclosures generally included in financial statements prepared in accordance with U.S. GAAP have been condensed and omitted. The footnote disclosures represent supplemental information relating to the operations of the Company, as such, these statements should be read in conjunction with the notes to the consolidated financial statements of the Group. 31. Additional information: condensed financial statements of the Company (Continued) The Company did not have significant other commitments, long-term obligations, or guarantees as of December 31, 2020. Condensed Balance Sheets (In thousands) December 31, 2019 December 31, 2020 Assets Current assets: Cash and cash equivalents 7,683 57,585 Short-term investments 102,555 47,525 Due from subsidiaries and consolidated VIEs 277,241 279,043 Prepayments and other current assets 274 860 Total current assets 387,753 385,013 Non-current assets: Investments in subsidiaries and consolidated VIEs (79,165) (79,936) Total assets 308,588 305,077 Liabilities Current liabilities: Accounts payable 55 55 Due to subsidiaries and consolidated VIEs 9,737 10,750 Contract liabilities and deferred income, current portion 1 1 Accrued liabilities and other payables 1,918 2,118 Total current liabilities 11,711 12,924 Total liabilities 11,711 12,924 Commitments and contingencies Shareholders’ equity Common shares 85 84 Treasury shares (29,711,964 shares and 34,475,224 shares as of December 31, 2019 and 2020, respectively) 7 8 Other shareholders’ equity 296,785 292,061 Total Xunlei Limited’s shareholders’ equity 296,877 292,153 Total liabilities and shareholders’ equity 308,588 305,077 31. Additional information: condensed financial statements of the Company (Continued) Condensed Statements of Operations Years ended December 31, (In thousands) 2018 2019 2020 Operating expenses Sales and marketing expenses — (1) — General and administrative expenses (1,483) (1,247) (1,438) Total operating expenses (1,483) (1,248) (1,438) Operating loss (1,483) (1,248) (1,438) Interest income 879 1,496 2 Interest expense (239) (75) (399) Other income, net 4,646 4,712 2,455 (Loss)/profit from subsidiaries and consolidated VIE - Continuing operations (43,221) (57,787) (14,361) - Discontinued operations 139 — — Loss before income tax (39,279) (52,902) (13,741) Income tax expenses — (267) (99) Net loss (39,279) (53,169) (13,840) Net loss attributable to Xunlei Limited’s common shareholders (39,279) (53,169) (13,840) Condensed Statements of Cash Flows Years ended December 31, (In thousands) 2018 2019 2020 Cash flows from operating activities Net cash used in operating activities (88,309) (171,796) (12,704) Cash flows from investing activities Net cash generated from investing activities 37,788 52,359 12,051 Cash flows from financing activities Net cash used in financing activities — — (4,475) Net decrease in cash and cash equivalents (50,521) (119,437) (5,128) Cash and cash equivalents at beginning of year 280,196 229,675 110,238 Effect of exchange rates on cash and cash equivalents — — — Cash and cash equivalents at end of year 229,675 110,238 105,110 |
Summary of significant accoun_2
Summary of significant accounting policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Summary of significant accounting policies | |
Basis of presentation and use of estimates | (a) Basis of presentation and use of estimates The consolidated financial statements of the Group have been prepared in accordance with accounting principles generally accepted in the United States of America (‘‘U.S. GAAP’’). Significant accounting policies followed by the Group in the preparation of the accompanying consolidated financial statements are summarized below. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the accompanying consolidated financial statements and related disclosures. Actual results could differ materially from these estimates. Significant accounting estimates reflected in the Group’s consolidated financial statements mainly include allowance for credit losses, valuation allowance of deferred tax assets, impairment assessment of goodwill and impairment assessment of long-lived assets. In addition, the Group uses assumptions in a valuation model to estimate the fair value of share options granted, warrants issued and underlying common shares. Management bases the estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results could differ from these estimates. |
Consolidation | (b) Consolidation The consolidated financial statements include the financial statements of the Company, its subsidiaries, VIE for which the Company is the primary beneficiary and its subsidiaries. All significant transactions and balances among the Company, its subsidiaries, VIE and its subsidiaries have been eliminated upon consolidation. A subsidiary is an entity in which the Company, directly or indirectly, controls more than one-half of the voting power, or has the power to appoint or remove the majority of the members of the board of directors to cast majority of votes at meetings of the board of directors or to govern the financial and operating policies of the investee under a statute or agreement among the shareholders or equity holders. An entity is considered to be a VIE if the entity’s equity holders do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. The Group consolidates entities for which the Company is the primary beneficiary if the entity’s other equity holders do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. 2. Summary of significant accounting policies (Continued) (b) Consolidation (Continued) In determining whether the Company or its subsidiary is the primary beneficiary of a VIE, the Company considered whether it has the power to direct activities that are significant to the VIE’s economic performance, including the power to appoint senior management, right to direct company strategy, power to approve capital expenditure budgets, and power to establish and manage ordinary business operation procedures and internal regulations and systems. Management has evaluated the contractual arrangements among Giganology Shenzhen, Shenzhen Xunlei and its shareholders and concluded that Giganology Shenzhen receives all of the economic benefits and absorbs all of the expected losses from Shenzhen Xunlei and has the power to direct the aforementioned activities that are significant to Shenzhen Xunlei’s economic performance, and is the primary beneficiary of Shenzhen Xunlei. Therefore, Shenzhen Xunlei and its subsidiaries’ results of operation, assets and liabilities have been included in the Group’s consolidated financial statements. Management monitors the regulatory risk associated with these contractual arrangements. See note 29 for further discussion. Non-controlling interests represent the portion of the net assets of a subsidiary attributable to interests that are not owned by the Company. The non-controlling interests are presented in the consolidated balance sheets, separately from equity attributable to the shareholders of the Company. Non-controlling interests in the results of the Group is presented on the face of the consolidated statements of comprehensive income as an allocation of the total income or loss for the year between non-controlling shareholders and the shareholders of the Company. |
Business combinations | (c) The Group accounts for acquisitions of entities that include inputs and processes and have the ability to generate economic benefit as business combinations. The Group allocates the purchase price of the acquisition to the tangible assets and identifiable intangible assets acquired based on their estimated fair values. The excess of the purchase price over those fair values is recorded as goodwill. Acquisition-related costs are expensed as incurred. |
Discontinued operations | (d) Discontinued operations When disposals that represent a strategic shift that has (or will have) a major effect on the entity’s results and operations would qualify as discontinued operations. Discontinued operations are reported when a component of an entity comprising operations and cash flows that can be clearly distinguished, operationally and for financial reporting purposes, from the rest of the entity is classified as held for disposal or has been disposed of, if the component either (1) represents a strategic shift or (2) have a major impact on an entity’s financial results and operations. Examples include a disposal of a major geographical location, line of business, or other significant part of the entity, or disposal of a major equity method investment. In the consolidated statement of comprehensive income, result from discontinued operations is reported separately from the income and expenses from continuing operations and prior periods are presented on a comparative basis. Cash flows for discontinuing operations are presented separately in note 4. In order to present the financial effects of the continuing operations and discontinued operations, revenues and expenses arising from intra-group transactions are eliminated except for those revenues and expenses that are considered to continue after the disposal of the discontinued operations. 2. Summary of significant accounting policies (Continued) (d) Discontinued operations (Continued) Non-current assets or disposal groups are classified as held for sale assets when the carrying amount is to be recovered principally through a sale transaction rather than through continuing use. For this to be the case, the asset or disposal group must be available for immediate sale in its present condition subject only to terms that are usual and customary for sale of such assets or disposal groups and the sale must be highly probable. Non-current assets classified as held for sale and disposal groups are measured at the lower of their carrying or fair value less costs to sell. |
Foreign currency translation | (e) Foreign currency translation The Company’s reporting and functional currency is the United States Dollar (‘‘USD’’). Xunlei BVI, Xunlei HK and HK Onething’s functional currency is the USD, and Thailand Onething’s functional currency is the Thai Baht (“THB”). The functional currency of other subsidiaries, VIE and its subsidiaries located in the PRC is the Renminbi (‘‘RMB’’), which is their respective local currency. Transactions denominated in foreign currencies are remeasured into the functional currency at the exchange rates prevailing on the transaction dates. Financial assets and liabilities denominated in foreign currencies are remeasured into the functional currency using the applicable exchange rates prevailing at the balance sheet date. The resulting exchange gains and losses from foreign currency transactions are included in other income/(loss) within the consolidated statements of comprehensive income. The Company uses the monthly average exchange rate for the year and the exchange rates at the balance sheet date to translate the operating results and financial position, respectively, of its subsidiaries whose functional currency is other than the USD. The resulting translation differences are recorded in cumulated translation adjustments, a component of shareholders’ equity. The exchange rate used is the one released by Chinese State Administration of Foreign Exchange. |
Cash and cash equivalents and restricted cash | (f) Cash and cash equivalents and restricted cash Cash and cash equivalents include cash on hand, cash in bank and time deposits placed with banks or other financial institutions, which have original maturities of three months or less and are readily convertible to known amounts of cash. Cash that is restricted as to withdrawal or for use or pledged as security is reported separately on the face of the consolidated balance sheets, and is included in the total cash, cash equivalents, and restricted cash in the consolidated statements of cash flows. The Group's restricted cash is substantially cash balance on deposit required by its business partners, commercial banks and the court. |
Short-term investments | (g) Short-term investments Short-term investments include deposits placed with banks with original maturities of more than three months but within one year and investments in financial instruments with a variable interest rate indexed to the performance of underlying assets. In accordance with ASC 825 Financial Instruments |
Allowance for expected credit losses | (h) Allowance for expected credit losses Effective on January 1, 2020, the Group adopted Accounting Standards Update (ASU) 2016-13, Financial Instruments - Credit Losses (Topic 326) The Group assessed the credit loss for accounts receivable with similar risk characteristics on a pool basis. The credit loss assessment for each pool was mainly based on past collection experience, consideration of current and future economic conditions and changes in our collection trends. The credit allowances provided for accounts receivable from continuing operations as of December 31, 2019 and 2020 were USD 7,604,000 and USD 9,329,000, respectively. |
Inventories | (i) Inventories Inventories are stated at the lower of cost or net realizable value. Cost is determined using actual cost on a weighted average basis. Net realizable value is the amount that can be realized from the sale of the inventory in the normal course of business after allowing for the costs of realization. |
Long-term investments | (j) Long-term investments The Group holds investments in privately held companies. Prior to adopting ASU 2016-01, Financial Instruments On January 1, 2018, the Group adopted ASU 2016-01, Financial Instruments 2. Summary of significant accounting policies (Continued) (j) Long-term investments (Continued) Management regularly evaluates the impairment of long-term equity investments based on performance and financial position of the investee as well as other evidence of market value. Such evaluation includes, but not limited to, reviewing the investee’s cash position, recent financing, projected and historical financial performance, cash flow forecasts and financing needs. An impairment loss recognized equal to the excess of the investment costs over its fair value at the end of each reporting period for which the assessment is made. The fair value would then become the new cost basis of investment. During the years ended December 31, 2018, 2019 and 2020 the Group recognized an impairment of USD 7,794,000, USD 19,830,000 and USD 794,000, and share of loss of equity investees of USD 317,000, nil and nil, respectively, from equity method investments. |
Property and equipment | (k) Property and equipment Property and equipment are stated at historical cost less accumulated depreciation and impairment loss, if any. Depreciation is calculated using the straight-line method over their estimated useful lives. Residual rate is determined based on the economic value of the asset at the end of the estimated useful life as a percentage of the original cost. If the Group commits to a plan to abandon a long-lived asset before the end of its previous estimated useful life, depreciation shall be revised to reflect a shortened useful life. Estimated useful lives Residual rate Servers and network equipment 3-5 years 5 % Computer equipment 5 years 5 % Furniture, fittings and office equipment 3-5 years 5 % Motor vehicles 5 years 5 % Leasehold improvements Shorter of lease term or 3 years — Repair and maintenance costs are expensed as incurred. Expenditures that substantially increase an asset’s useful life are capitalized. Upon sale or disposal, gain or loss on the disposal of property and equipment is the difference between the net sales proceeds and the carrying amount of the relevant assets and is recognized in the consolidated statements of comprehensive loss. The cost and related accumulated depreciation are removed from the balance sheets. |
Goodwill | (l) Goodwill Goodwill represents the excess of the purchase consideration over the fair value of the identifiable tangible and intangible assets acquired and liabilities assumed from the acquired entity as a result of the Company’s acquisitions of interests in its subsidiaries and consolidated VIEs. Goodwill is not amortized but is tested for impairment on an annual basis, or more frequently if events or changes in circumstances indicate that it might be impaired. The Company first assesses qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. In the qualitative assessment, the Company considers primary factors such as industry and market considerations, overall financial performance of the reporting unit, and other specific information related to the operations. Based on the qualitative assessment, if it is more likely than not that the fair value of each reporting unit is less than the carrying amount, the quantitative impairment test is performed. 2. Summary of significant accounting policies (Continued) (l) Goodwill (Continued) In performing the two-step quantitative impairment test, the first step compares the fair values of each reporting unit to its carrying amount, including goodwill. If the fair value of each reporting unit exceeds its carrying amount, goodwill is not considered to be impaired and the second step will not be required. If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of goodwill to the carrying value of a reporting unit’s goodwill. The implied fair value of goodwill is determined in a manner similar to accounting for a business combination with the allocation of the assessed fair value determined in the first step to the assets and liabilities of the reporting unit. The excess of the fair value of the reporting unit over the amounts assigned to the assets and liabilities is the implied fair value of goodwill. This allocation process is only performed for the purposes of evaluating goodwill impairment and does not result in an entry to adjust the value of any assets or liabilities. Application of a goodwill impairment test requires significant management judgment, including the identification of reporting units, allocation of assets, liabilities and goodwill to reporting units, and determination of the fair value of each reporting unit. Starting in 2020, the Company adopted the FASB issued ASU 2017-04: Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (the “Update”). To simplify the subsequent measurement of goodwill, the Board eliminated Step 2 from the goodwill impairment test. Under the amendments in this Update, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. An entity should apply the amendments in this Update on a prospective basis. An entity is required to disclose the nature of and reason for the change in accounting principle upon transition. It is more likely that, by adopting simplified measurement which eliminates the Step 2 from goodwill impairment test, an entity with the triggering event for goodwill impairment will recognize more goodwill impairment than it would do under the old model. The Group’s goodwill was attributable to the Company as a whole. The impairment test for goodwill determines the fair value of the reporting unit, the Company as a whole, and compares it to the carrying value of the assets and liabilities, including goodwill, of the reporting unit. The fair value of the Company was estimated by management using the discounted cash flow model derived from the long-term (five-year) cash flow projections, which included significant judgements and assumptions relating to revenue forecast and operating margins, discount rate of 18.2% that reflects market assessments of the time value and the specific risks relating to the Company, and cash flows beyond the five-year period are extrapolated using a terminal growth rate of 2%. No goodwill impairment losses were recognized for the years ended December 31, 2018, 2019 and 2020 based on the impairment test performed by the Group. |
Intangible assets | (m) Intangible assets Intangible assets, which include land use rights, acquired computer software, online game licenses and audio-visual license, are carried at cost less accumulated amortization with no residual value and impairment loss, if any. Amortization of intangible assets is computed using the straight-line method over the estimated useful lives of the assets as follows: Estimated useful lives Land use rights 30 years Acquired computer software 5 years Online game licenses 1 Audio-visual license 9 years 2. Summary of significant accounting policies (Continued) |
Impairment of long-lived assets | (n) Impairment of long-lived assets For other long-lived assets, the Group evaluates its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may no longer be recoverable. The Group assesses the recoverability of the long-lived assets by comparing the carrying value of the long-lived assets to the estimated undiscounted future cash flows expected to be received from use of the assets and their eventual disposition at the lowest level of identifiable cash flows. Such assets are considered to be impaired if the sum of the expected undiscounted cash flows is less than the carrying amount of the assets. If the Group identifies an impairment, the carrying value of the asset will be reduced to its estimated fair value based on a discounted cash flow approach or, when available and appropriate, to comparable market values. |
Commitments and contingencies | (o) Commitments and contingencies In the normal course of business, the Group is subject to contingencies, such as legal proceedings and claims arising out of its business, that cover a wide range of matters. Liabilities for such contingencies are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated. In regard to legal cost, the Group recorded such costs as incurred. Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Group, but which will only be resolved when one or more future events occur or fail to occur. The Group’s management and its legal counsel assess such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Group or unasserted claims that may result in such proceedings, the Group, in consultation with its legal counsel, evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Group’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss, if determinable and material, would be disclosed. |
Operating leases | (p) Operating leases On January 1, 2019, the Group adopted ASC Topic 842 Leases Lessees shall follow the requirements to classify most leases as either financing or operating using principles similar to previous lease accounting. In the statement of comprehensive income, a lessee shall present both of the following: a) for finance leases, the interest expense on the lease liability and amortization of the right-of-use asset are not required to be presented as separate line items and shall be presented in a manner consistent with how the entity presents other interest expense and depreciation or amortization of similar assets, respectively; b) for operating leases, lease expense shall be included in the lessee’s income from continuing operations. 2. Summary of significant accounting policies (Continued) (p) Operating leases (Continued) The Group adopted ASC 842 on a modified retrospective basis and did not restate comparative periods. The adoption of ASC 842 resulted in the recognition of right-of-use assets and related lease liabilities of approximately USD11.8 million and USD11.4 million, respectively, which were reported on the consolidated balance sheet as of January 1, 2019. The Group have elected the short-term lease exemption for all leases with a lease term of 12 months. Payments associated with short-term leases are recognized on a straight-line basis as an expense in profit or loss. The standard also requires a lessee to recognize a single lease cost related to operating lease, calculated so that the cost of the lease is allocated over the lease term, on a generally straight-line basis. The net profit after tax had not to be materially impacted as a result of adopting the new rules. With the adoption of ASC 842, the Group assesses, at contract inception, whether a contract is, or contains, a lease. That is, if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. In determining the appropriate discount rate to use in calculating the present value of contractual lease payments, management regularly evaluates the lessee’s incremental borrowing rate, as the rate implicit in the lease cannot be readily determined. See note 12 for additional disclosures on operating lease arrangements. |
Revenue recognition | (q) Revenue recognition The Group adopted ASC Topic 606 Revenue from Contracts with Customer Revenue is recognized when or as the control of the services or goods is transferred to the customer. Depending on the terms of the contract and the laws that apply to the contract, control of the services and goods may be transferred over time or at a point in time. A contract liability is the Group’s obligation to transfer goods or services to a customer for which the Group has received consideration (or an amount of consideration is due) from the customer. Contract costs includes incremental costs of obtaining a contract and costs to fulfil a contract. The Group generates revenues from various streams. Net revenues presented in the consolidated statements of loss represent revenues from service and product sales net off sales discount, value-added tax and related surcharges. 2. Summary of significant accounting policies (Continued) (q) Revenue recognition (Continued) (I) Subscription revenues The Group operates a VIP membership program where VIP members can have access to high speed online acceleration services, online streaming and other access privileges. The membership fee is time-based and is collected up-front from subscribers. The terms of time-based subscriptions range from one month to twelve months, with the subscribers having the option to renew the contract. The receipt of subscription fee is initially recorded as contract liabilities. The Group satisfies its various performance obligations by providing services throughout the subscription period and revenue is recognized ratably over the period of subscription as services are rendered. Unrecognized portion beyond 12 months from balance sheet date is classified as a long-term liability. The Group evaluated the principal versus agent criteria and determined that the Group is the principal in the transaction and accordingly records revenue on a gross basis. In determining whether to report revenues gross for the amount of subscription revenue, the Group assesses whether it maintains the principal relationship with the VIP members, whether it bears the credit risk and whether it establishes prices for the end users. Service fees levied by online system, fixed phone line and mobile payment channels (‘‘Payment handling charges’’) are recorded as the cost of revenues in the same period as the revenue for the membership fee is recognized. (II) Advertising revenues Advertising revenues are derived principally from arrangements where the customers pay to place their advertisements on the Group’s platform over a particular period of time. It includes multiple performance obligations, primarily for advertisements to be displayed in different spots at different times, placed under different formats including but are not limited to videos, banners, links, logos and buttons. Advertisements on the Group’s platform are generally charged on the basis of duration, and advertising contracts are signed to establish the fixed price and the advertising services to be provided. The Group enters into advertising contracts with third party advertising agencies that represents advertisers, as well as directly with advertisers. A typical contract term would range from a few days to 3 months. Both third party advertising agencies and direct advertisers are generally billed at the end of the display period and payments are due usually within 3 months. Where the Group’s customers purchase multiple advertising spaces with different display periods in the same contract, the Group allocates the total consideration to the various advertising elements based on their relative fair values and recognizes revenue for the different elements over their respective display periods. The Group determines the fair values of different advertising elements based on the prices charged when these elements were sold on a standalone basis. The Group recognizes revenue on the elements delivered and defers the recognition of revenue for the fair value of the undelivered elements until the remaining obligations have been satisfied. Where all of the elements within an arrangement are delivered uniformly over the agreement period, the revenue is recognized on a straight-line basis over the contract period. Transactions with third party advertising agencies For contracts entered into with third party advertising agencies, the third-party advertising agencies will in turn sell the advertising services to advertisers. Revenue is recognized ratably over the contract period of display. The Group provides sales incentives in the forms of discounts and rebates to third party advertising agencies based on purchase volume. As the advertising agencies are viewed as the customers in these transactions, revenue is recognized based on the price charged to the agencies, net of sales incentives provided to the agencies. Sales incentives are estimated and recorded at the time of revenue recognition based on the contracted rebate rates and estimated sales volume based on historical experience. 2. Summary of significant accounting policies (Continued) (q) Revenue recognition (Continued) (II) Advertising revenues (Continued) Transactions with advertisers The Group also enters into advertisement contracts directly with advertisers. Under these contracts, similar to transactions with third party advertising agencies, the Group recognizes revenue ratably over the contract period of display. The terms and conditions, including price, are fixed according to the contract between the Group and the advertisers. The Group also performs credit assessment of all advertisers prior to entering into contracts. Revenue is recognized based on the amount charged to the advertisers, net of discounts. The Group has estimated and recorded sales rebates provided to the agencies and advertisers of USD 394,000, nil and nil for the years ended December 31, 2018, 2019 and 2020, respectively. Transactions with advertising platforms Xunlei also cooperates with advertising platforms such as Guangdiantong and Baidu, of which, the advertising platforms are responsible for matching the requirements of advertisers or advertising agencies and dispatching the advertising content to Xunlei's platforms by certain analysis systematically. As the advertising platforms are viewed as customers in these transactions, revenue is recognized monthly based on the data publicized on the platforms and pre-agreed sharing portion. In May 2020, the Group entered into a user traffic monetization agreement with Beijing Itui Technology Co., Ltd. (“Beijing Itui”), a company controlled by the Company's principal shareholder. Since May 2020, Beijing Itui has been handling all of the Group's advertising resources, including matching the requirements of advertisers and dispatching the advertising content to Xunlei's platforms. Beijing Itui is viewed as the customer and revenue is recognized monthly based on the data publicized on the platforms and pre-agreed sharing portion. (III) Live streaming revenue The Group operates a live streaming platform where users can access the platform, view the live streaming content provided by the Group’s performers, and purchase virtual gifts which they can grant to performers in the live streaming platform to show support for their favorite performers. Xunlei is the principal in the provision of the live streaming content and experience, which is considered as the performance obligation of the Group. The Group recognized revenue from sales of virtual gifts to the viewers when the relevant virtual gifts are presented to the performers or over the duration of stated period of the time-based item. The Group does not have further obligations to the viewers after the virtual gifts are consumed immediately or after the stated period for time-based items, although the Group will continue to provide the live streaming content to the viewers in order to continue to generate more sales of virtual gifts. (IV) Cloud computing and other internet value-added services (i) Revenues from cloud computing As part of the Group’s cloud computing business, the Group engages in sale of OneThing Cloud. OneThing Cloud is a personal cloud hardware device that allows users to share their idle bandwidth with the Group, in exchange for LinkTokens. LinkTokens are not convertible into cash but they can be used to redeem products and services offered in the LinkTokens Mall. LinkTokens represent an obligation to deliver future services by the operator of the LinkToken program. 2. Summary of significant accounting policies (Continued) (q) Revenue recognition (Continued) (IV) Cloud computing and other internet value-added services (Continued) (i) Revenues from cloud computing (Continued) Prior to April 1, 2019, the bandwidth shared by the users in exchange for LinkTokens is an identifiable benefit which the Group can reasonably estimate fair value. The benefit that the Group receives from user’s contribution of bandwidth is independent from OneThing Cloud that the Group sells to users. In April 2019, the Group transferred the operation of LinkTokens, including the issuance and redemption obligation of LinkTokens, as well as the LinkTokens Mall to a third party, Beijing LinkChain Co., Ltd. (“Beijing LinkChain”). Upon completion of the transfer, users could continue to share their idle bandwidth with the Group in exchange for the LinkTokens issued by Hainan LinkChain Networking Technology Co., Ltd. (“Hainan LinkChain”), a wholly owned subsidiary of Beijing LinkChain, (note 9). In addition, the Group is obligated to pay to Hainan LinkChain a pre-determined amounts per active user of OneThing Cloud who shared their idle bandwidth with the Group. This arrangement expired in April 2020. In April 2020, the Group launched the OneThing Cloud app, allowing users to contribute their idle bandwidth capacity in exchange for certain amount of cash rewards. As the sales of OneThing Cloud and purchase of excess bandwidth by the Group are considered separate transactions, the sales of OneThing Cloud should be reported as revenue, while cash rewards given for purchase of bandwidth should be reported as bandwidth cost. The Group primarily sells OneThing Cloud to individuals through online e-commerce platforms before 2019 and also corporate customers starting from 2019. The performance obligation is satisfied when the item is dispatched to the end customers. The core business concept of cloud computing is to collect idle uplink capacity from individuals with reward, and deliver those collected computing resources to online video streaming platforms. On a monthly basis, the Group records the bandwidth it delivers and recognizes revenue from these online video streamers under contractual rates applied (price per GB of bandwidth multiplies total GBs of bandwidth per month). Revenue is recognized net of return allowances when the products are delivered and title passes to customers. Return allowances, which reduce net revenues, are estimated based on historical experiences. Product warranties are estimated and recognized at the time the Company recognizes revenue. The warranty period is 1 year. The Company accrues warranty liabilities at the time of sale, based on historical and projected incident rates and expected future warranty costs. (ii) Revenues from online games Since 2018, the Group discontinued its web game business and started to operate web game business again under a co-operation model with third party games operators in 2019. 2. Summary of significant accounting policies (Continued) (q) Revenue recognition (Continued) (IV) Cloud computing and other internet value-added services (Continued) (ii) Revenues from online games (Continued) Web games – cooperating with third parties The Group enters into a series of technical cooperation agreements with third party online game operators. Users access to the Group’s platform and purchase in-game virtual items which can then be used in games provided by the third-party online game operators. The Group provides the third-party online game operators with a portal which the online game operators can host the online games. The Group charges the online game operators based on a pre-determined portion of proceeds earned from paying users pursuant to the revenue sharing arrangements for the provision of portal and payment collection service to the online game operators. The third-party online game operators are the principal in the provision of games to users and the Group provide the relevant platform to the game operators, therefore, the game operators are viewed as the customers in these transactions. The service fees receivable from the third-party online game operators are variable, which are contingent upon future events (future cash proceeds paid by game players), and are recognized when the contingency is met provided that collectability is reasonably assured. |
Sales and marketing expenses | (r) Sales and marketing expenses Sales and marketing expenses comprise primarily salary, benefits of sales and marketing personnel and external advertising and market promotion expenses. The external advertising and market promotion expenses from continuing operations amounted to approximately USD 22,935,000, USD 20,974,000 and USD 11,026,000 for the years ended December 31, 2018, 2019 and 2020, respectively. Shipping and handling fee is recorded in sales and marketing expenses. |
General and administrative expenses | (s) General and administrative expenses General and administrative expenses consist primarily of salary and benefits, professional service fees, legal expenses and other administrative expenses. |
Research and development costs | (t) Research and development costs The Group incurred research and development costs to develop its downloading software and bandwidth crowdsourcing technologies to enhance the competitive advantages of the Group’s key products, such as Xunlei Accelerator and cloud computing services. Costs incurred during the research phase are expensed as incurred. Costs incurred for the development of the downloading software and bandwidth crowdsourcing technologies prior to the establishment of technological feasibility, which is when a working model is available, are expensed when incurred. The development costs qualified for capitalization have been immaterial for the periods presented. In addition, the Group incurred other research and development costs in relation to software used to support its operations. Any development costs qualified for capitalization were immaterial for the periods presented. |
Taxation and uncertain tax positions | 2. Summary of significant accounting policies (Continued) (u) Taxation and uncertain tax positions Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statements’ carrying amounts of existing assets and liabilities and their respective tax bases and tax loss carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which the difference is expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the consolidated statement of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the carrying amount of deferred tax assets if it is considered more likely than not that some portion, or all, of the deferred tax assets will not be realized. The estimation of future taxable income involves significant judgement and estimates. Based on management’s estimated future taxable income, management concluded that it is more likely than not that the net operating losses carried forward can be utilized prior to their respective expiration dates. The Group adopted the guidance regarding uncertain tax positions and evaluated its open tax positions that exist in each jurisdiction for each reporting period. If an uncertain tax position is taken or expected to be taken in a tax return, the tax benefit from that uncertain position is recognized in the Group’s consolidated financial statements if it is more likely than not that the position is sustainable upon examination by the relevant taxing authority. The Group did not have any significant uncertain tax position and there was no effect on its financial condition or results of operations as a result of implementing the new guidance. The Group recognizes interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense, if any. PRC Value Added Tax VAT payable on goods sold or taxable labor services provided by a general VAT taxpayer for a taxable period is the net balance of the output VAT for the period after crediting the input VAT for the period. In addition to the product revenues currently subject to VAT at a rate of 13% (16% before April 1, 2019 and 17% before May 1, 2018), the Group’s advertising revenues, subscription revenue, online game revenue, revenue from cloud computing services and live streaming revenue are now subject to VAT at a rate of 6%. According to the policy of the PRC State Tax Bureau, starting from April 1, 2019 to December 31, 2021 enterprises that engage in postal services, telecommunication services and consumer services are entitled to claim 110% of the input tax incurred as tax credit in determining VAT payable. |
Retirement benefits | (v) Retirement benefits Full-time employees of the Company’s subsidiaries, consolidated VIE and its subsidiaries in the PRC participate in a government mandated multi-employer defined contribution plan pursuant to which certain pension benefits, medical care, unemployment insurance, employee housing fund and other welfare benefits are provided to employees. Chinese labor regulations require that the subsidiaries and VIEs of the Company make contributions to the government for these benefits based on certain percentages of the employees’ salaries. The Group has no legal obligation for the benefits beyond the contributions made. The total amounts from continuing operations for such employee benefits, which are expensed as incurred, were USD 12,501,000, USD 12,337,000 and USD 7,949,000 for the years ended December 31, 2018, 2019 and 2020, respectively. |
Share-based compensation | (w) Share-based compensation The Group measures share-based compensation at the grant date based on the fair value of the award determined using the Black-Scholes option pricing model. As the Group has granted share options and restricted shares with service-only condition, the Group elected to recognize compensation costs net of estimated forfeitures on a straight-line basis over the requisite service period, which is generally the same as the vesting period. The amount of compensation cost recognized at any date is at least equal to the portion of the grant-date value of the award that is vested at that date. |
Government subsidies | (x) Government subsidies The Group receives subsidies from the local PRC government for general use or purchase of equipment. General-use subsidies which are not subject to any conditions or specific use requirements are recorded as subsidy income in the consolidated statements of operations. Subsidies for purchase of equipment are recorded as deferred government grant when received, and are recorded as other income over the expected useful life of the assets after the related equipment has been purchased. |
Segment reporting | (y) Segment reporting The Group’s Chief Executive Officer has been identified as the chief operating decision maker, who reviews consolidated operating results of the Group when making decisions about allocating resources and assessing performance of the Group as a whole. The Group has internal reporting of revenue, cost and expenses that does not distinguish between segments, and reports costs and expense by nature as a whole. The Group does not distinguish between markets or segments for the purpose of internal reporting. Management has determined that the Group operates and manages its business as a single segment, over 99%of revenues of the Group were derived from mainland China. An analysis of the different types of revenues for the years ended December 31, 2018, 2019 and 2020 are summarized as follows: Revenue from continuing operations Years ended December 31, (In thousands) 2018 2019 2020 Subscription revenue 81,877 81,532 84,299 Product revenue (note a) 54,604 8,269 1,412 Live streaming revenue 31,031 26,920 20,866 Advertising revenue 27,781 15,643 13,206 Cloud computing service and other internet value-added services (note b) 36,839 48,903 66,900 Total 232,132 181,267 186,683 Notes: (a) Product revenue comprise sales of OneThing Cloud devices and hard disks. (b) Other internet value-added services mainly comprise provision of technical services. |
Net loss per share | (z) Net loss per share Net basic loss per share is computed by dividing net loss attributable to holders of common shares by the weighted-average number of common shares outstanding during the year using the two class method. Using the two class method, net loss is allocated between common shares and other participating securities based on their participating rights. Net diluted loss per share is calculated by dividing net loss attributable to common shareholders as adjusted for the effect of dilutive common equivalent shares, if any, by the weighted-average number of common and dilutive common equivalents shares outstanding during the year. Dilutive equivalent shares are excluded from the computation of diluted loss per share if their effects would be anti-dilutive. Common share equivalents consist of the common shares issuable upon the conversion of the stock options, using the treasury stock method. |
Comprehensive income | (aa) Comprehensive income Comprehensive income is defined as the change in equity of a Group during the period from transactions and other events and circumstances excluding transactions resulting from investments from shareholders and distributions to shareholders. Accumulated other comprehensive income, as presented on the accompanying consolidated balance sheets, consists of cumulative translation adjustments. |
Profit appropriation and statutory reserves | (bb) Profit appropriation and statutory reserves The Group’s subsidiaries, consolidated VIE and its subsidiaries incorporated in the PRC are required on an annual basis to make appropriations of retained earnings set at certain percentage of after-tax profit determined in accordance with PRC accounting standards and regulations (“PRC GAAP”). Appropriation to the statutory general reserve should be at least 10% of the after-tax net income determined in accordance with the legal requirements in the PRC until the reserve is equal to 50% of the entities’ registered capital. The Group is not required to make appropriation to other reserve funds and the Group does not have any intentions to make appropriations to any other reserve funds. The general reserve fund can only be used for specific purposes, such as setting off the accumulated losses, enterprise expansion or increasing the registered capital. Appropriations to the general reserve funds are classified in the consolidated balance sheets as statutory reserves. There are no legal requirements in the PRC to fund these reserves by transfer of cash to restricted accounts, and the Group does not do so. |
Dividends | (cc) Dividends Dividends are recognized when declared. No dividends were declared for the years ended December 31, 2018, 2019 and 2020. The Group does not have any present plan to pay any dividends on common shares in the foreseeable future. The Group currently intends to retain the available funds and any future earnings to operate and expand its business. |
Recent accounting pronouncements | (dd) Recent accounting pronouncements Income Tax (Topic 740): Simplifying the Accounting for Income Taxes. Clarifying the interactions between Topic 321, Topic 323, and Topic 815: |
Organization and nature of op_2
Organization and nature of operations (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Organization and nature of operations | |
Accompanying Consolidated Financial Statements Include Financial Statements of Company, Subsidiaries, Variable Interest Entity ("VIE") and VIE's Subsidiaries | These consolidated financial statements include the financial statements of the Company, its subsidiaries, its variable interest entity (“VIE”) and the VIE’s subsidiaries (collectively referred to as the “Group”). As of December 31, 2020, the Company’s major subsidiaries, VIE and VIE’s subsidiaries are as follows: % of direct or indirect Place of Period of economic Name of entities incorporation incorporation Relationship ownership Principal activities Shenzhen Xunlei Networking Technologies Co., Ltd. (“Shenzhen Xunlei”) People’s Republic of China (“PRC”) January 2003 VIE 100 % Development of software, provision of online and related advertising, membership subscription and online game services, as well as sales of software licenses Giganology (Shenzhen) Co., Ltd. (“Giganology Shenzhen”) PRC June 2005 Subsidiary 100 % Development of computer software and provision of information technology services to related companies Shenzhen Xunlei Wangwenhua Co., Ltd. (formerly known as “Shenzhen Fengdong Networking Technologies Co., Ltd.”) (“Wangwenhua”) PRC December 2005 VIE’s subsidiary 100 % Development of software for related companies and provision of advertising services Shenzhen Zhuolian Software Co., Ltd. (formerly known as “Xunlei Software (Shenzhen) Co., Ltd.”) PRC January 2010 VIE’s subsidiary 100 % Provision of software technology development for related companies Xunlei Games Development (Shenzhen) Co., Ltd. (“Xunlei Games”) PRC February 2010 VIE’s subsidiary 70 % Development of online game and computer software for related companies and provision of advertising services Xunlei Network Technologies Limited (“Xunlei BVI”) British Virgin Islands February 2011 Subsidiary 100 % Holding company Xunlei Network Technologies Limited (“Xunlei HK”) Hong Kong March 2011 Subsidiary 100 % Holding company and development of computer software Xunlei Computer (Shenzhen) Co., Ltd. (“Xunlei Computer”) PRC November 2011 Subsidiary 100 % Development of computer software and provision of information technology services Shenzhen Onething Technologies Co., Ltd. (“Onething”) PRC September 2013 VIE’s subsidiary 100 % Development of computer software, sale of hardware, and provision of information technology services Beijing Xunjing Technologies Co., Ltd. (formerly known as “Wangxin Century Technologies (Beijing) Co., Ltd.”) (“Beijing Xunjing”) PRC October 2015 VIE’s subsidiary 100 % Development of computer software and provision of information technology services 1. Organization and nature of operations (Continued) % of direct or indirect Place of Period of economic Name of entities incorporation incorporation Relationship ownership Principal activities Shenzhen Crystal Interactive Technologies Co., Ltd. (“Crystal Interactive”) PRC May 2016 VIE’s subsidiary 100 % Development of computer software and provision of information technology services Beijing Onething Technologies Co., Ltd. PRC January 2017 VIE’s subsidiary 100 % Provision of technology services and development of computer software HK Onething Technologies Ltd. (“HK Onething”) Hong Kong December 2017 Subsidiary 100 % Development of cloud computing technology and provision of related services Hainan Onething E-Sports Co., Ltd. PRC May 2018 Subsidiary 100 % Development of computer software and E-sports related services Henan Tourism Information Co., Ltd. (“Henan Tourism”) PRC June 2018 VIE’s Subsidiary 80 % Software development, tourism consulting and other related services Onething Co., Ltd. (Thailand) (“Thailand Onething”) Thailand July 2018 Subsidiary 49 % Development of cloud computing technology and provision of related services Hainan Xunlei Blockchain Technology Co., Ltd. PRC August 2018 VIE’s subsidiary 100 % Development of computer software and provision of information technology services Shenzhen Yunwang Wulian Technology Co., Ltd. (formerly known as “Shenzhen Qianhai Shanxian Daojia Technology Co., Ltd.”, “Shanxian Daojia”) PRC September 2020 Subsidiary 100 % Development of computer software and provision of information technology services Jiangxi Node Technology Service Co., Ltd. PRC July 2020 Subsidiary 100 % Development of computer software and provision of information technology services Note a : The English names of the PRC companies represent management’s translation of the Chinese names of these companies as they have not adopted formal English names. |
Summary of significant accoun_3
Summary of significant accounting policies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Summary of significant accounting policies | |
Schedule of Property and Equipment Estimated Useful Life | Estimated useful lives Residual rate Servers and network equipment 3-5 years 5 % Computer equipment 5 years 5 % Furniture, fittings and office equipment 3-5 years 5 % Motor vehicles 5 years 5 % Leasehold improvements Shorter of lease term or 3 years — |
Summary of estimated useful lives of the intangible assets | Estimated useful lives Land use rights 30 years Acquired computer software 5 years Online game licenses 1 Audio-visual license 9 years |
Analysis of Different Types of Revenues | Revenue from continuing operations Years ended December 31, (In thousands) 2018 2019 2020 Subscription revenue 81,877 81,532 84,299 Product revenue (note a) 54,604 8,269 1,412 Live streaming revenue 31,031 26,920 20,866 Advertising revenue 27,781 15,643 13,206 Cloud computing service and other internet value-added services (note b) 36,839 48,903 66,900 Total 232,132 181,267 186,683 Notes: (a) Product revenue comprise sales of OneThing Cloud devices and hard disks. (b) Other internet value-added services mainly comprise provision of technical services. |
Business combination (Tables)
Business combination (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Business combination | |
Summary of the allocation of the purchase price at the date of acquisition | USD (In thousands) As of acquisition date Property and equipment, net 17 Accrued liabilities and other payables (798) Goodwill 781 Total — |
Discontinued operations (Tables
Discontinued operations (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Web Game Business [Member] | |
Disposal Groups, Including Discontinued Operations | Results of the discontinued operation Year ended USD (In thousands) December 31, 2018 Revenues, net of rebates and discounts 656 Business taxes and surcharges (1) Net revenues 655 Cost of revenues (16) Gross profit 639 Operating expenses Research and development expenses (419) Sales and marketing expenses (63) General and administrative expenses (18) Total operating expenses (500) Operating income 139 Gain on disposal of web game 1,394 Income tax expenses (230) Income from discontinued operations 1,303 Cash flows generated from the discontinued operation Year ended USD (In thousands) December 31, 2018 Net cash generated from operating activities 1,065 Net cash flow for the year 1,065 |
Cash and cash equivalents (Tabl
Cash and cash equivalents (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Cash and cash equivalents | |
Summary of Cash on Hand and Cash Held at Bank | Cash and cash equivalents represent cash on hand, cash held at bank, and time deposits placed with banks or other financial institutions, which have original maturities of three months or less. Cash on hand and cash held at bank balance as of December 31, 2019 and 2020 primarily consist of the following currencies: December 31, 2019 December 31, 2020 USD USD (In thousands) Amount equivalent Amount equivalent RMB 322,972 46,296 312,581 47,906 USD 115,805 115,805 89,050 89,050 Hong Kong Dollar 2,202 283 1,737 224 THB 2,417 81 2,052 68 Total 162,465 137,248 |
Short-term investments (Tables)
Short-term investments (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Short-term investments | |
Schedule of Short-Term Investments | (In thousands) December 31, 2019 December 31, 2020 Time deposits 102,555 68,828 Investments in financial instruments (note) 292 48,993 Total 102,847 117,821 Note: The investments were issued by commercial banks in the PRC with a variable interest rate indexed to performance of underlying assets. Since these investments’ maturity dates are within one year, they are classified as short-term investments. |
Accounts receivable, net (Table
Accounts receivable, net (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Accounts receivable, net | |
Schedule of Accounts Receivable | (In thousands) December 31, 2019 December 31, 2020 Accounts receivable 35,137 32,312 Less: Allowance for credit losses (7,604) (9,329) Accounts receivable, net 27,533 22,983 |
Schedule of Allowance for Doubtful Accounts | The following table presents movement in the allowance for expected credit loss: (In thousands) December 31, 2018 December 31, 2019 December 31, 2020 Balance at beginning of the year 31 7,709 7,604 Additions 7,680 19 1,137 Exchange difference (2) (124) 588 Balance at end of the year 7,709 7,604 9,329 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Inventories | |
Schedule of inventories | (In thousands) December 31, 2019 December 31, 2020 Hardware devices (note) 9,091 4,830 Others 162 324 Less: Impairment (3,716) (3,428) Total 5,537 1,726 Note: Hardware devices mainly include OneThing Cloud and hard disks. OneThing Cloud is a hardware, which can act as a micro server between users and Xunlei, which enables users to share their idle uplink capacity with Xunlei. |
Prepayments and other current_2
Prepayments and other current assets (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Prepayments and other current assets | |
Schedule of Prepayments and Other Assets | (In thousands) December 31, 2019 December 31, 2020 Current portion: Advance to suppliers (note a) 3,579 1,483 Receivable related to Linktoken disposal (note b) 3,536 — Interest-free loans to employees (note c) 3,185 1,896 Rental and other deposits 1,990 1,670 Proceed receivable 1,105 137 Prepayment for taxation 936 112 Prepaid management insurance 249 241 Advance to employees for business purposes 211 86 Interest receivable 4 2 Deposit related to an ongoing litigation (note d) — 4,751 Others 1,748 1,156 Total of prepayments and other current assets 16,543 11,534 Non-current portion: Low-interest loans to employees, non-current portion (note c) 313 905 Total of long-term prepayments and other assets 313 905 Notes: (a) Advances to suppliers primarily include prepayments to bandwidth suppliers. (b) In September 2018, Onething entered into a sale and purchase agreement with Beijing LinkChain to dispose of the operation and related assets and liabilities of LinkToken program. In June 2019, certain supplemental agreements were entered into with Beijing LinkChain and Hainan LinkChain, the rights and obligations related to LinkToken program was transferred to Hainan LinkChain. The receivable related to LinkToken disposal as of December 31, 2019 included the consideration receivable due from Hainan LinkChain and the amount recoverable from expenses paid on behalf of Hainan LinkChain. An impairment provision of USD 3,536,000 was recognized as of December 31, 2020, due to the deterioration of Hainan LinkChain’s operation and financial position. 9. Prepayments and other current assets (Continued) (c) The Group had entered into loan contracts with certain employees as of December 31, 2020, under which the Group provided interest-free loans or low-interest loans to these employees. The loan amounts vary amongst different employees from repayable on demand to repayable in equal installments on a monthly basis over a term of 5 to 10 years . The balances classified as current represented loan amounts that are repayable on demand or repayable within the next twelve months from the balance sheet date. (d) The balance as of December 31, 2020 represented the deposits placed in a custodian bank account of the court to secure an order for preservation of assets against a supplier of the Group. |
Long-term investments (Tables)
Long-term investments (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Long-term investments | |
Schedule of Long-Term Investments | (In thousands) December 31, 2019 December 31, 2020 Equity interests without a readily determinable fair value: Balance at beginning of the year 33,638 26,365 Additions 2,838 — Disposal (1,055) — Net unrealized gains on investments held 10,907 794 Exchange difference (132) 369 Less: impairment loss on long-term investments (19,831) (794) Balance at end of the year 26,365 26,734 Total long-term investments 26,365 26,734 |
Schedule of Equity Investments, Percentage of Ownership of Common Share | Details of the Group's ownership of the long-term investments are as follows: Percentage of ownership of shares as of December 31, Investee 2019 2020 Equity method investments: Zhuhai Qianyou Technology Co., Ltd. 19.00 % 19.00 % Shenzhen Mojingou Information Services Co., Ltd. (formerly named as “Xunlei Big Data Information Service Co., Ltd.”). 28.77 % 28.77 % Equity interests without a readily determinable fair value: 9.30 % 9.30 % Shanghai Guozhi Electronic Technology Co., Ltd. 16.80 % 16.80 % Guangzhou Hongsi Network Technology Co., Ltd. 19.90 % 19.90 % Chengdu Diting Technology Co., Ltd. 12.74 % 12.74 % Xiamen Diensi Network Technology Co., Ltd. 14.25 % 14.25 % 11.2 Capital I, L.P. 2.03 % 2.03 % Cloudtropy 9.69 % 9.69 % Tianjin Kunzhiyi Network Technology Co., Ltd. (note a) 19.90 % N/A Shanghai Lexiang Technology Co., Ltd. ("Shanghai Lexiang") (note b) 13.54 % 7.81 % Hangzhou Feixiang Data Technology Co., Ltd. 28.00 % 28.00 % Shenzhen Meizhi Interactive Technology Co., Ltd. 9.40 % 9.40 % Beijing Yunhui Tianxia Technology Co., Ltd. 13.70 % 13.70 % Yingshi Innovation Technology Co., Ltd. (formerly named as “Shenzhen Arashi Vision Interactive Technology Co., Ltd.” or “Insta360”) 8.73 % 8.73 % Beijing Cloudin Technology Limited Co., Ltd. 4.12 % 4.12 % Quanxun Huiju Networking Technology (Beijing) Co., Ltd. 5.40 % 5.40 % 10. Long-term investments (Continued) Notes : (a) The company has been deregistered in May 2020. (b) In October 2020, the Group disposed 4.82% of the equity interest in Shanghai Lexiang, for which full impairment have been provided in December 2019, at a consideration of USD 268,000. The remaining equity interest in Shanghai Lexiang was remeasured based on this observable price change from the disposal, a fair value gain of USD 794,000 was recognized accordingly. The Group recognized impairment against this investment of USD 794,000 as of December 31, 2020, after considering Shanghai Lexiang’s operation performance, financial and liquidity position after the above transaction. |
Property and equipment (Tables)
Property and equipment (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property and equipment | |
Schedule of Property and Equipment | (In thousands) December 31, 2019 December 31, 2020 Servers and network equipment 39,130 35,827 Computer equipment 1,762 1,565 Furniture, fixtures and office equipment 806 836 Motor vehicles 406 481 Leasehold improvements 6,566 6,604 Total original costs 48,670 45,313 Less: Accumulated depreciation (28,357) (33,006) Less: Accumulated impairment (4) (3) Sub-total 20,309 12,304 Construction in progress 18,461 38,421 Total 38,770 50,725 |
Summary of Depreciation Expense | Years ended December 31 (In thousands) 2018 2019 2020 Cost of revenues 5,018 5,198 6,247 Research and development expenses 331 300 529 General and administrative expenses 245 317 2,492 Sales and marketing expenses 1 9 9 Total 5,595 5,824 9,277 |
Right-of-use assets and lease_2
Right-of-use assets and lease liabilities (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Right-of-use assets and lease liabilities | |
Schedule of right-of-use assets for long-term operating leases | (In thousands) Office leases Balance at January 1, 2019 on adoption of ASC 842 Leases 11,819 Additions 3,830 Modification of operating lease (1,107) Amortization (5,634) Effect of foreign currency exchange differences (161) Net book amount at December 31, 2019 8,747 Additions 500 Modification of operating lease (3,825) Amortization (3,685) Effect of foreign currency exchange differences 217 Net book amount at December 31, 2020 1,954 |
Schedule of undiscounted cash payment | The undiscounted cash payment for each of the next five years as of December 31, 2019 is: (In thousands) 2020 5,034 2021 3,000 2022 1,279 Total undiscounted payments 9,313 Less: effect of discounting (488) Discounted lease liabilities 8,825 The undiscounted cash payment for each of the next five years as of December 31, 2020 is: (In thousands) 2021 1,998 2022 28 Total undiscounted payments 2,026 Less: effect of discounting (38) Discounted lease liabilities 1,988 |
Intangible assets, net (Tables)
Intangible assets, net (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Intangible assets, net | |
Schedule of Intangible Assets | December 31, 2019 December 31, 2020 Net book Net book (In thousands) Cost Amortization Impairment value Cost Amortization Impairment value Land use rights 4,769 (1,017) — 3,752 5,099 (1,258) — 3,841 Acquired computer software 2,391 (1,433) — 958 3,530 (2,853) — 677 Online game licenses 5,910 (5,193) (717) — — — — — Audio-visual license 5,621 (905) — 4,716 6,010 (1,671) — 4,339 18,691 (8,548) (717) 9,426 14,639 (5,782) — 8,857 |
Schedule of Amortization Expense Recognized | Years ended December 31 (In thousands) 2018 2019 2020 Cost of revenues 266 5 — General and administrative expenses 721 1,136 1,210 Research and development expenses 244 59 6 Total 1,231 1,200 1,216 |
Schedule of Estimated Aggregate Amortization Expense | (In thousands) Intangible assets 2021 1,107 2022 1,050 2023 1,036 2024 972 2025 and thereafter 4,692 |
Schedule of Weighted Average Amortization Periods of Intangible Assets | (In year) December 31, 2019 December 31, 2020 Land use rights 30 30 Acquired computer software 5 5 Online game licenses 3 — Audio-visual license 9 9 Total weighted average amortization periods 12 10 |
Goodwil (Tables)
Goodwil (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill. | |
Summary of goodwill | (In thousands) December 31, 2019 December 31, 2020 Beginning balance 20,717 20,382 Addition (note) — 815 Foreign currency translation adjustment (335) 1,410 Ending balance 20,382 22,607 Note: The addition of goodwill in 2020 was related to the acquisition of Shanxian Daojia, please refer to note 3 for the acquisition. |
Contract liabilities and defe_2
Contract liabilities and deferred income (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Contract liabilities and deferred income | |
Schedule of Contract Liabilities and Deferred Income | (In thousands) December 31, 2019 December 31, 2020 Contract liabilities (Note a) Membership subscription 29,769 31,981 Others 2,142 2,513 Other deferred income Government grants 1,300 466 Total 33,211 34,960 Less: non-current portion (Note b) (1,223) (920) Contract liabilities and deferred income, current portion 31,988 34,040 Notes: (a) Contract liabilities were related to unsatisfied performance obligations at the end of the year. Due to the generally short-term duration of the contracts, the majority of the performance obligations are satisfied in the following period. The amount of revenue recognized that was included in contract liabilities balance at the beginning of the year was USD 26,911,000 and USD 30,189,000 for the years ended December 31, 2019 and 2020, respectively. (b) As of December 31, 2019 and 2020, the non-current portion consists of membership subscription of USD 781,000 and USD 751,000, and government grants of USD 442,000 and USD 169,000, respectively. |
Accrued liabilities and other_2
Accrued liabilities and other payables (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Accrued liabilities and other payables | |
Schedule of Accrued Liabilities and Other Payables | (In thousands) December 31, 2019 December 31, 2020 Payroll and welfare 14,995 12,871 Tax levies 4,538 3,394 Payables related to Kankan 3,733 2,581 Payables for advertisement 3,606 1,895 Legal and litigation related expenses (note 28) 2,765 1,640 Professional fees 2,714 2,106 Agency commissions and rebates—online advertising 2,521 2,696 Payables for construction in progress 1,382 5,291 Tax surcharges 1,076 1,095 Payables for technological services 778 617 Payables for gaming distribution 288 148 Deposits from customers 225 229 Payables for proceeds from selling exercised stock options and restricted shares 94 137 Payables for purchase of equipment 21 29 Others 4,104 3,960 Total 42,840 38,689 |
Bank borrowings (Tables)
Bank borrowings (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Bank borrowings | |
Summary of bank borrowings | (In thousands) December 31, 2019 December 31, 2020 Bank borrowings 11,324 19,924 |
Summary of maturity of bank borrowings | As of December 31, 2020, the bank borrowings will be due according to the following schedule: (In thousands) Principal amounts Within 1 year — Between 1 to 2 years — Between 2 to 3 years 747 Between 3 to 4 years 996 Between 4 to 5 years 996 Beyond 5 years 17,185 |
Repurchase of shares (Tables)
Repurchase of shares (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Repurchase of shares | |
Schedule of share repurchase activity | Total number of ADSs purchased as Average price Period part of the publicly announced plan paid per ADS July 8 - July 31 857,147 3.72 August 3 - August 18 334,245 3.86 Total for the year ended December 31, 2020 1,191,392 |
Share-based compensation (Table
Share-based compensation (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Summary of Share Option Activity | The following table summarizes the share option activities for the years ended December 31, 2018, 2019 and 2020: Weighted Weighted Weighted- average average average remaining Aggregate Number of exercise grant-date contractual life intrinsic share options price (USD) fair value (USD) (years) value (USD) Outstanding, January 1, 2018 389,815 3.90 — 1.64 — Vested and expected to vest at January 1, 2018 389,693 3.90 0.95 1.64 — Exercisable at January 1, 2018 389,190 3.90 0.95 1.64 — Expired (373,315) 3.89 Outstanding, December 31, 2018 16,500 3.97 — 1.37 — Vested and expected to vest at December 31, 2018 16,500 3.97 1.56 1.37 — Exercisable at December 31, 2018 16,500 3.97 1.56 1.37 — Expired (6,500) 3.97 Outstanding, December 31, 2019 10,000 3.97 — 1.16 — Vested and expected to vest at December 31, 2019 10,000 3.97 1.01 1.16 — Exercisable at December 31, 2019 10,000 3.97 1.01 1.16 — Expired (10,000) 3.97 Outstanding, December 31, 2020 — — — — — Vested and expected to vest at December 31, 2020 — — — — — Exercisable at December 31, 2020 — — — — — |
Schedule of Recognized Compensation Costs | Total compensation costs recognized for the years ended December 31, 2018, 2019 and 2020 are as follows: Years ended December 31, (In thousands) 2018 2019 2020 Sales and marketing expenses 404 381 185 General and administrative expenses 2,245 2,453 1,209 Research and development expenses 2,645 2,594 916 Total 5,294 5,428 2,310 |
2013 Plan | |
Summary of Restricted Shares Activities | A summary of the restricted shares activities under the 2013 Plan for the years ended December 31, 2018, 2019 and 2020 is presented below: Number of restricted shares Unvested at January 1, 2018 587,760 Vested (525,140) Forfeited (28,445) Unvested at December 31, 2018 34,175 Expected to vest at December 31, 2018 29,049 Unvested at January 1, 2019 34,175 Vested (27,475) Forfeited (6,700) Unvested at December 31, 2019 — Expected to vest at December 31, 2019 — |
2010 Plan | |
Summary of Restricted Shares Activities | A summary of the restricted shares activities under the 2010 Plan for the years ended December 31, 2018, 2019 and 2020 is presented below: Weighted-average Number of grant-date fair restricted shares value Unvested at January 1, 2018 1,272,150 Expected to vest at January 1, 2018 1,081,327 Granted 6,750,520 2.32 Vested (267,630) Forfeited (1,103,000) Unvested at December 31, 2018 6,652,040 Expected to vest at December 31, 2018 5,654,234 Granted 800,000 0.81 Vested (1,296,540) Forfeited (971,000) Unvested at December 31, 2019 5,184,500 Expected to vest at December 31, 2019 4,406,825 Vested (965,500) Forfeited (2,959,000) Unvested at December 31, 2020 1,260,000 Expected to vest at December 31, 2020 1,071,000 |
2014 Plan | |
Summary of Restricted Shares Activities | A summary of the restricted shares activities under the 2014 Plan for the years ended December 31, 2018, 2019 and 2020 is presented below: Number of restricted shares Unvested at January 1, 2018 5,806,350 Vested (2,086,450) Forfeited (243,250) Unvested at December 31, 2018 3,476,650 Expected to vest at December 31, 2018 2,955,153 Unvested at January 1, 2019 3,476,650 Vested (1,318,450) Forfeited (837,000) Unvested at December 31, 2019 1,321,200 Expected to vest at December 31, 2019 1,123,020 Unvested at January 1, 2020 1,321,200 Vested (228,200) Forfeited (1,067,000) Unvested at December 31, 2020 26,000 Expected to vest at December 31, 2020 22,100 |
Cost of revenues (Tables)
Cost of revenues (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Cost of revenues | |
Schedule of cost of revenues | Years ended December 31, Cost of revenues from continuing operations (In thousands) 2018 2019 2020 Bandwidth costs 48,118 57,093 62,384 Cost of inventories sold 31,634 7,181 1,660 Cost of live streaming 23,928 20,734 15,640 Depreciation of servers and other equipment 5,018 5,198 6,247 Payment handling charges 3,016 1,658 1,459 Other costs (note) 3,953 8,049 5,247 Total 115,667 99,913 92,637 Note: Other costs mainly included write-down of inventories. |
Other income, net (Tables)
Other income, net (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Other income, net | |
Schedule of other income, net | Continuing Operations Years ended December 31, (In thousands) 2018 2019 2020 Government subsidy income 2,096 2,061 2,287 Investment income from short-term investments 5,817 4,020 2,943 Net unrealized gains arising from long-term investments — 10,907 794 Investment income on disposal of long-term investments — 579 214 Impairment of long-term investments (7,794) (19,831) (794) Exchange gain/(loss), net 1,216 (402) (2,948) Settlement income 414 1,531 — Gains from disposal of Linktoken program — 6,630 — Value-added tax deduction — 427 1,361 Others 1,061 (61) 880 Total 2,810 5,861 4,737 |
Taxation (Tables)
Taxation (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Taxation | |
Schedule of Current and Deferred Portions of Income Tax Expense | Continuing operations Years ended December 31, (In thousands) 2018 2019 2020 Current income tax (benefits)/expenses (471) 315 183 Deferred income tax expenses 382 4,361 966 Income tax (benefits)/expenses (89) 4,676 1,149 |
Summary of Aggregate Amount and Per Share Effect of Tax Holiday | Years ended December 31, 2018 2019 2020 Aggregate dollar effect (In thousands) (3,776) (3,856) 197 Per share effect—basic (0.01) (0.01) (0.00) Per share effect—diluted (0.01) (0.01) (0.00) |
Reconciliation of Total Tax (Benefits)/Expenses | Continuing operations Years ended December 31, (In thousands) 2018 2019 2020 Income tax benefit at PRC statutory rate (based on statutory tax rate applicable to enterprises in China) (10,384) (11,886) (3,736) Effects of differences in tax rates in different jurisdictions applicable to entities of the Group outside of the PRC 485 788 787 Non-deductible expenses 245 228 101 Effect of Super Deduction (881) (1,920) (733) Effect of tax holidays and tax concessions 3,776 3,856 (197) Change in valuation allowance of deferred tax assets 6,720 13,180 4,704 Effect on deferred tax assets due to change in tax rates (167) — — Expiration of tax loss 562 400 84 Others (445) 30 139 Income tax (benefits)/expenses (89) 4,676 1,149 |
Summary of Changes in Deferred Tax Asset and Liability Balances | The tax effects of temporary differences that give rise to the deferred tax assets and liabilities balances of December 31, 2019 and 2020 are as follows: (In thousands) December 31, 2019 December 31, 2020 Deferred tax assets: Net operating losses carried forward (note a) 27,712 32,458 Impairment of long-term equity investments 4,061 4,233 Impairment of other receivables 1,553 1,858 Impairment of accounts receivable 1,140 1,451 Impairment of inventories 549 540 Allowance for advance to suppliers 346 369 Impairment of property and equipment 14 15 Valuation allowance (34,257) (40,924) Deferred tax assets, net (note b) 1,118 — Deferred tax liabilities: Deferred credit arising from an asset acquisition (1,179) (1,085) Notes: (a) As of December 31, 2020, the accumulated net operating loss of USD 3,079,000 of the Group’s subsidiaries incorporated in Hong Kong can be carried forward indefinitely to offset future taxable income, the remaining accumulated net operating loss of USD 179,797,000 mainly arose from the Company’s subsidiaries and consolidated VIEs established in the PRC, which can be carried forward to offset future taxable income and will expire during the period from 2021 to 2030. (b) As of December 31, 2019 and 2020, the deferred tax assets and liabilities balances are expected to be recoverable as follows: Deferred tax assets (In thousands) 2019 2020 Within one year 133 — After one year 985 — 1,118 — Deferred tax liabilities (In thousands) 2019 2020 Within one year (165) (176) After one year (1,014) (909) (1,179) (1,085) |
Schedule of Deferred Tax Assets and Liabilities Balances | Deferred tax assets (In thousands) 2019 2020 Within one year 133 — After one year 985 — 1,118 — Deferred tax liabilities (In thousands) 2019 2020 Within one year (165) (176) After one year (1,014) (909) (1,179) (1,085) |
Schedule of Movement of Valuation Allowance | Years ended December 31, (In thousands) 2018 2019 2020 Beginning balance (16,599) (20,181) (34,257) Additions (6,720) (13,180) (4,704) Exchange difference 3,138 (896) (1,963) Ending balance (20,181) (34,257) (40,924) |
Basic and diluted net loss pe_2
Basic and diluted net loss per share (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Basic and diluted net loss per share | |
Schedule of Basic and Diluted Net Loss Per Share | Basic and diluted net loss per share for the years ended December 31, 2018, 2019 and 2020 are calculated as follows: (Amounts expressed in thousands of USD, except for number of shares and per Years ended December 31, share data) 2018 2019 2020 Numerator: Net loss from continuing operations (40,793) (53,415) (14,140) Net income from discontinued operations 1,303 — — Net loss (39,490) (53,415) (14,140) Less: Net loss attributable to the non-controlling interest (212) (246) (300) Net loss attributable to Xunlei Limited’s common shareholders (39,278) (53,169) (13,840) Numerator of basic net loss per share from continuing operations (40,581) (53,169) (13,840) Numerator of basic net income per share from discontinued operations. 1,303 — — Numerator for diluted loss per share from continuing operations (40,581) (53,169) (13,840) Numerator for diluted income per share from discontinued operations 1,303 — — Denominator: Denominator for basic net loss per share-weighted average shares outstanding 334,965,987 337,845,675 337,429,601 Denominator for diluted net loss per share 334,965,987 337,845,675 337,429,601 Basic net loss per share from continuing operations (0.12) (0.16) (0.04) Basic net income per share from discontinued operations 0.00 N/A N/A Diluted net loss per share from continuing operations (0.12) (0.16) (0.04) Diluted net income per share from discontinued operations 0.00 N/A N/A |
Related party transactions (Tab
Related party transactions (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Related party transactions | |
Schedule of Relationship Between Related Parties with their Groups | The table below sets forth the related parties and their relationships with the Group: Related Party Relationship with the Group Chuan Wang Chairman and director of the Company (note i) Shenglong Zou Co-founder, director and shareholder of the Company Weimin Luo Director and Chief Operating Officer of the Company Shenzhen Crystal Technology Co., Ltd. ("Shenzhen Crystal”) Company owned by a co-founder and director of the Company Vantage Point Global Limited Shareholder of the Company Aiden & Jasmine Limited Shareholder of the Company Millet Technology Co., Ltd. (“Xiaomi Technology”) Note ii Millet Communication Technology Co., Ltd. (“Millet Communication Technology”) Note ii Beijing Xiaomi Mobile Software Co., Ltd. (“Beijing Xiaomi Mobile Software”) Note ii Beijing Millet Payment Technologies Co., Ltd. (“Beijing Millet Payment Technologies”) Note ii Guangzhou Millet Information Service Co., Ltd. (“Guangzhou Millet”) Note ii Shenzhen Xiaomi Technology Co., Ltd. (“Shenzhen Xiaomi”) Note ii Beijing Itui Company owned by the principal shareholder of the Company (note iii) Beijing Itui Online Network Technology Co., Ltd. (“Itui Online”) Company owned by the principal shareholder of the Company (note iii) 26. Related party transactions (Continued) Note: (i) Chuan Wang has resigned from the board on April 2, 2020. (ii) Prior to April 2, 2020, these companies were related companies to the Company as they were affiliated companies of a shareholder of the Company, Xiaomi Ventures Limited (“Xiaomi Ventures”). On April 2, 2020, Xiaomi Ventures ceased to be the shareholder of the Company as Xiaomi Ventures together with certain shareholders of the Company exchanged their common shares of the Company for the shares of Itui International Inc. (“Itui”). In addition, Xiaomi Ventures entitled to certain veto rights in determining Itui’s voting on the Company. As a result, Xiaomi Ventures and the companies controlled by Xiaomi Ventures continued to be related parties of the Company. (iii) These companies become related parties of Xunlei since April 2, 2020. |
Schedule of Significant Related Party Transactions | During the years ended December 31, 2018, 2019 and 2020, significant related party transactions were as follows: Years ended December 31, (In thousands) 2018 2019 2020 Game sharing costs paid and payable to an investee company 9 — — Bandwidth revenue from Beijing Xiaomi Mobile Software (note a) 4,254 1,815 — Bandwidth revenue from Xiaomi Technology (note a) — 875 2,211 Forum service fees paid and payable to Xiaomi Technology (note b) 38 13 — Advertisement revenue from Guangzhou Millet (note c) — 19 — Technology service revenue from Guangzhou Millet (note d) 3,932 2,460 2,466 Advertisement revenue from Shenzhen Xunyi (note e) 493 — — Bandwidth revenue from Shenzhen Xunyi (note e) 160 — — Accrued to Vantage Point Global Limited (note f) 146 46 243 Accrued to Aiden & Jasmine Limited (note f) 54 17 91 Advertisement revenues from Beijing Itui (note g) — — 7,269 Bandwidth revenues from Itui Online (note h) — — 1,119 Bandwidth cost from an investee company — — 594 Advertisement revenue from Shenzhen Xiaomi (note i) — — 53 Repayment of loans to Weimin Luo arising from a business combination (note 3) — — 662 Notes: (a) From July 2017 to July 2019, Onething entered into a contract with Beijing Xiaomi Mobile Software for the provision of bandwidth to Beijing Xiaomi Mobile Software at a price benchmarking against market price, based on actual usage. From August 2019 till now, Onething entered into the contract with Xiaomi Technology for the provision of bandwidth to Xiaomi Technology at a price benchmarking against market price, based on actual usage. (b) Onething Cloud devices were available for sale on the online platform operated by Xiaomi Technology starting from August 2018 till April 2019, during which Xiaomi Technology was entitled to receive service fees based on a certain percentage of sales on the platform. (c) From 2017, an advertising services contract was entered into with Guangzhou Millet at a price benchmarking against market price. (d) The Group is entitled to receive a mutually agreed sharing of net advertising revenue covering a period from mid-June 2017 to mid-June 2019, as compensation for technology solution services provided to Guangzhou Millet. The contract was extended for two years from mid-June 2019 to mid-June 2021 based on the same term. (e) In 2018, a sales contract was entered into with Shenzhen Xunyi for provision of bandwidth and advertising services at a price benchmarking against market price, based on actual usage. (f) In 2014, the Group repurchased 3,860,733 common shares from Aiden & Jasmine Limited (Co founder’s company) for USD10,879,000 and 10,334,679 common shares from Vantage Point Global Limited for USD29,121,000. According to the repurchase contract, the Company was entitled to an amount (the “Withheld Price”) to withhold any taxes with respect to this repurchase as required under the applicable laws. If the Seller has not been specifically required by the applicable governmental or regulatory authority to pay any taxes as required under the applicable laws in connection with the repurchase, after the fifth anniversary of the Closing Date, the Company will pay to the Seller the Withheld Price with a simple interest thereon at the rate of five percent (5%) per annum from the Closing Date. Therefore, the Withheld Price for Aiden & Jasmine Limited and Vantage Point Global Limited was USD 1,451,000 (including interest of USD 363,000) and USD 3,883,000 (including interest of USD 971,000) respectively. The interest accrued for the year ended December 31, 2020 was USD 91,000 and USD 243,000 for Aiden & Jasmine Limited and Vantage Point Global Limited respectively. The Group has repaid USD 3,883,000 to Vantage Point Global Limited in January 2021. (g) In 2020, an user traffic monetization agreement was entered into with Beijing Itui, according to which Xunlei is entitled to receive a mutually agreed sharing of net advertising revenue covering a period from mid-May 2020 to mid-May 2021. (h) The Company entered into a sales contract with Itui Online for provision of bandwidth at a price benchmarking against market price and charged based on actual usage since 2019. (i) In 2020, a user traffic monetization agreement was entered into with Shenzhen Xiaomi, according to which Xunlei is entitled to receive a mutually agreed sharing of net advertising revenue |
Schedule of Amount Due to from Related Party | (In thousands) December 31, 2019 December 31, 2020 Amounts due from related parties Accounts receivable from Guangzhou Millet 1,361 1,456 Accounts receivable from Xiaomi Technology 262 576 Accounts receivable from Itui Online — 1,153 Accounts receivable from Beijing Itui — 7,689 Accounts receivable from Shenzhen Xiaomi — 60 Other receivable from Xiaomi Technology 14 15 Other receivable from Shenzhen Crystal 6 6 Other receivable from Shenglong Zou 9 9 Other receivable from Chuan Wang 6 6 (In thousands) December 31, 2019 December 31, 2020 Amounts due to related parties Accounts payable to investee companies 2 55 Other payable to Vantage Point Global Limited 3,640 3,883 Other payable to Aiden & Jasmine Limited 1,360 1,451 |
Fair value measurements (Tables
Fair value measurements (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Fair value measurements | |
Schedule of Financial Instruments Measured at Fair Value | Fair value measurements as at December 31, 2019 Quoted prices Significant in active market other Significant for identical observable unobservable assets inputs inputs (In thousands) Total (Level 1) (Level 2) (Level 3) Short term investments: Investments in financial instruments 292 — 292 — 292 — 292 — Fair value measurements as at December 31, 2020 Quoted prices Significant in active market other Significant for identical observable unobservable assets inputs inputs (In thousands) Total (Level 1) (Level 2) (Level 3) Short term investments: Investments in financial instruments 48,993 — 48,993 — 48,993 — 48,993 — |
Commitments and contingencies (
Commitments and contingencies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Bandwidth Purchase Commitments [Member] | |
Future Minimum Payments under Non-Cancellable Leases | Future minimum payments under non-cancellable bandwidth contracts consist of the following as of December 31, 2020: (In thousands) 2021 3,388 2022 406 3,794 |
Capital commitments [Member] | |
Future Minimum Payments under Non-Cancellable Leases | As at December 31, 2020, the Group has unconditional purchase obligations for office software and construction in progress that had not been recognized in the amount of USD 7,953,000. (In thousands) 2021 7,040 2022 — 2023 913 7,953 |
Certain risks and concentrati_2
Certain risks and concentration (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Certain risks and concentration | |
Schedule of Consolidated Financial Information of VIEs and VIE's Subsidiaries | The following consolidated financial information of the Group’s VIE and its subsidiaries from continuing operations was included in the accompanying consolidated financial statements, before elimination of balances with the Company and its subsidiaries, as of and for the years ended: As of December 31, (In thousands) 2019 2020 Current assets: Cash and cash equivalents 34,847 14,284 Short-term investments 292 — Accounts receivable, net 30,686 32,485 Due from related parties 1,644 10,955 Inventories 5,330 1,726 Prepayments and other current assets 20,747 15,712 Total current assets 93,546 75,162 Non-current assets: Long-term investments 5,337 5,706 Deferred tax assets 985 — Property and equipment, net 38,417 50,532 Intangible assets, net 9,426 8,857 Goodwill 20,382 22,607 Other long-term prepayments and non-current assets 313 905 Right-of-use assets 8,619 1,915 Restricted cash 2,983 1,541 Total non-current assets 86,462 92,063 Total assets 180,008 167,225 Current liabilities: Accounts payable (including inter-companies balances with the Company and its subsidiaries of USD 21,297 and USD 30,439 as of December 31, 2019 and 2020, respectively (note a)) 45,162 51,027 Due to a related party 2 55 Contract liabilities and deferred income, current portion 31,988 34,040 Income tax payable 2,436 2,500 Accrued liabilities and other payables (including inter-companies balances with the Company and its subsidiaries of USD 152,904 and USD 152,611 as of December 31, 2019 and 2020, respectively (note b)) 191,406 185,972 Lease liabilities, current portion 4,621 1,912 Total current liabilities 275,615 275,506 Non-current liabilities: Contract liabilities and deferred income, non-current portion 1,223 920 Deferred tax liabilities 1,179 1,085 Lease liabilities, non-current portion 4,073 27 Bank borrowings 11,324 19,924 Total non-current liabilities 17,799 21,956 Total liabilities 293,414 297,462 Years ended December 31, (In thousands) 2018 2019 2020 Net revenues from continuing operations 231,616 177,520 186,413 Net loss attributable to Xunlei Limited (40,728) (56,328) (10,673) Years ended December 31, (In thousands) 2018 2019 2020 Net cash provided by/(used in) operating activities 7,548 (16,047) (21,008) Net cash used in investing activities (7,925) (5,001) (9,160) Net cash provided by financing activities 2,096 11,707 7,154 1,719 (9,341) (23,014) |
Additional information_ conde_2
Additional information: condensed financial statements of the Company (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Additional information: condensed financial statements of the Company | |
Schedule of Condensed Balance Sheets | The Company did not have significant other commitments, long-term obligations, or guarantees as of December 31, 2020. Condensed Balance Sheets (In thousands) December 31, 2019 December 31, 2020 Assets Current assets: Cash and cash equivalents 7,683 57,585 Short-term investments 102,555 47,525 Due from subsidiaries and consolidated VIEs 277,241 279,043 Prepayments and other current assets 274 860 Total current assets 387,753 385,013 Non-current assets: Investments in subsidiaries and consolidated VIEs (79,165) (79,936) Total assets 308,588 305,077 Liabilities Current liabilities: Accounts payable 55 55 Due to subsidiaries and consolidated VIEs 9,737 10,750 Contract liabilities and deferred income, current portion 1 1 Accrued liabilities and other payables 1,918 2,118 Total current liabilities 11,711 12,924 Total liabilities 11,711 12,924 Commitments and contingencies Shareholders’ equity Common shares 85 84 Treasury shares (29,711,964 shares and 34,475,224 shares as of December 31, 2019 and 2020, respectively) 7 8 Other shareholders’ equity 296,785 292,061 Total Xunlei Limited’s shareholders’ equity 296,877 292,153 Total liabilities and shareholders’ equity 308,588 305,077 |
Schedule of Condensed Statements of Operations | 31. Additional information: condensed financial statements of the Company (Continued) Condensed Statements of Operations Years ended December 31, (In thousands) 2018 2019 2020 Operating expenses Sales and marketing expenses — (1) — General and administrative expenses (1,483) (1,247) (1,438) Total operating expenses (1,483) (1,248) (1,438) Operating loss (1,483) (1,248) (1,438) Interest income 879 1,496 2 Interest expense (239) (75) (399) Other income, net 4,646 4,712 2,455 (Loss)/profit from subsidiaries and consolidated VIE - Continuing operations (43,221) (57,787) (14,361) - Discontinued operations 139 — — Loss before income tax (39,279) (52,902) (13,741) Income tax expenses — (267) (99) Net loss (39,279) (53,169) (13,840) Net loss attributable to Xunlei Limited’s common shareholders (39,279) (53,169) (13,840) |
Schedule of Condensed Statements of Cash Flows | Condensed Statements of Cash Flows Years ended December 31, (In thousands) 2018 2019 2020 Cash flows from operating activities Net cash used in operating activities (88,309) (171,796) (12,704) Cash flows from investing activities Net cash generated from investing activities 37,788 52,359 12,051 Cash flows from financing activities Net cash used in financing activities — — (4,475) Net decrease in cash and cash equivalents (50,521) (119,437) (5,128) Cash and cash equivalents at beginning of year 280,196 229,675 110,238 Effect of exchange rates on cash and cash equivalents — — — Cash and cash equivalents at end of year 229,675 110,238 105,110 |
Organization and nature of op_3
Organization and nature of operations - Additional Information (Details) ¥ / shares in Units, $ in Thousands, ¥ in Millions | 1 Months Ended | 12 Months Ended | ||||
May 31, 2011CNY (¥) | Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2020¥ / shares | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Variable Interest Entity [Line Items] | ||||||
Number of year's power of attorney retained | 10 years | |||||
Percentage of pre-tax operating profit | 80.00% | |||||
Right-of-use assets | $ | $ 1,954 | $ 8,747 | $ 11,819 | |||
Lease liabilities | $ | $ 1,988 | $ 8,825 | ||||
Giganology Shenzhen | ||||||
Variable Interest Entity [Line Items] | ||||||
Termination of agreement, notice period | 30 days | |||||
Automated extended period of agreement | 10 years | |||||
Agreement expiration date | 2022 | |||||
Agreement between Giganology Shenzhen and Mr. Sean Shenglong Zou [Member] | ||||||
Variable Interest Entity [Line Items] | ||||||
Additional interest-free loans | ¥ 20 | |||||
Increase in registered capital | 30 | |||||
Agreement between Giganology Shenzhen and Shareholders of Shenzhen Xunlei [Member] | ||||||
Variable Interest Entity [Line Items] | ||||||
Interest-free loans | ¥ 9 | |||||
Agreement between Giganology Shenzhen and Shenzhen Xunlei [Member] | ||||||
Variable Interest Entity [Line Items] | ||||||
Increase in registered capital | ¥ 20 | |||||
Term agreement expiration year | 2016 | |||||
Call Option Agreement [Member] | Giganology Shenzhen | ||||||
Variable Interest Entity [Line Items] | ||||||
Agreement expiration date | 2022 | |||||
Outstanding share, purchase price per share | ¥ / shares | ¥ 1 | |||||
Exclusive Technology Support and Services Agreement [Member] | ||||||
Variable Interest Entity [Line Items] | ||||||
Percentage of pre-tax operating profit | 20.00% | |||||
Exclusive Technology Support and Services Agreement [Member] | Giganology Shenzhen | ||||||
Variable Interest Entity [Line Items] | ||||||
Term agreement expiration year | 2025 | |||||
Exclusive Technology Consulting and Training Agreement [Member] | ||||||
Variable Interest Entity [Line Items] | ||||||
Percentage of pre-tax operating profit | 20.00% | |||||
Software and Proprietary Technology License Contract [Member] | ||||||
Variable Interest Entity [Line Items] | ||||||
Percentage of pre-tax operating profit | 40.00% |
Organization and nature of op_4
Organization and nature of operations - Accompanying Consolidated Financial Statements Include Financial Statements of Company, Subsidiaries, Variable Interest Entity ("VIE") and VIE's Subsidiaries (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Giganology Shenzhen | |
Variable Interest Entity [Line Items] | |
Place of incorporation | PRC |
Period of incorporation | Jun. 30, 2005 |
Relationship | Subsidiary |
Percentage of direct or indirect economic ownership | 100.00% |
Principal activities | Development of computer software and provision of information technology services to related companies |
Xunlei BVI | |
Variable Interest Entity [Line Items] | |
Place of incorporation | British Virgin Islands |
Period of incorporation | Feb. 28, 2011 |
Relationship | Subsidiary |
Percentage of direct or indirect economic ownership | 100.00% |
Principal activities | Holding company |
Xunlei HK | |
Variable Interest Entity [Line Items] | |
Place of incorporation | Hong Kong |
Period of incorporation | Mar. 31, 2011 |
Relationship | Subsidiary |
Percentage of direct or indirect economic ownership | 100.00% |
Principal activities | Holding company and development of computer software |
Xunlei Computer | |
Variable Interest Entity [Line Items] | |
Place of incorporation | PRC |
Period of incorporation | Nov. 30, 2011 |
Relationship | Subsidiary |
Percentage of direct or indirect economic ownership | 100.00% |
Principal activities | Development of computer software and provision of information technology services |
Shenzhen Xunlei | |
Variable Interest Entity [Line Items] | |
Place of incorporation | People’s Republic of China (“PRC”) |
Period of incorporation | Jan. 31, 2003 |
Relationship | VIE |
Percentage of direct or indirect economic ownership | 100.00% |
Principal activities | Development of software, provision of online and related advertising, membership subscription and online game services, as well as sales of software licenses |
Wangwenhua | |
Variable Interest Entity [Line Items] | |
Place of incorporation | PRC |
Period of incorporation | Dec. 31, 2005 |
Relationship | VIE’s subsidiary |
Percentage of direct or indirect economic ownership | 100.00% |
Principal activities | Development of software for related companies and provision of advertising services |
Zhuolian Software | |
Variable Interest Entity [Line Items] | |
Place of incorporation | PRC |
Period of incorporation | Jan. 31, 2010 |
Relationship | VIE’s subsidiary |
Percentage of direct or indirect economic ownership | 100.00% |
Principal activities | Provision of software technology development for related companies |
Xunlei Games | |
Variable Interest Entity [Line Items] | |
Place of incorporation | PRC |
Period of incorporation | Feb. 28, 2010 |
Relationship | VIE’s subsidiary |
Percentage of direct or indirect economic ownership | 70.00% |
Principal activities | Development of online game and computer software for related companies and provision of advertising services |
Onething | |
Variable Interest Entity [Line Items] | |
Place of incorporation | PRC |
Period of incorporation | Sep. 30, 2013 |
Relationship | VIE’s subsidiary |
Percentage of direct or indirect economic ownership | 100.00% |
Principal activities | Development of computer software, sale of hardware, and provision of information technology services |
Beijing Xunjing | |
Variable Interest Entity [Line Items] | |
Place of incorporation | PRC |
Period of incorporation | Oct. 31, 2015 |
Relationship | VIE’s subsidiary |
Percentage of direct or indirect economic ownership | 100.00% |
Principal activities | Development of computer software and provision of information technology services |
Summary of significant accoun_4
Summary of significant accounting policies - Additional Information (Details) - USD ($) | May 01, 2018 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2019 |
Accounting Policies and General Information [Line Items] | |||||||
Allowance for doubtful accounts | $ 9,329,000 | $ 7,604,000 | $ 7,709,000 | $ 31,000 | |||
Impairment of long-term investments | $ 794,000 | 19,831,000 | 7,794,000 | ||||
Cash flow projection period | 5 years | ||||||
Discount rate | 18.20% | ||||||
Terminal Growth Rate to extrapolate the cash flows beyond five-year period | 2.00% | ||||||
Goodwill impairment losses | $ 0 | 0 | 0 | ||||
Sales rebates provided to the agencies and advertisers | 0 | 0 | 394,000 | ||||
External advertising and market promotion expenses from continuing operations | $ 11,026,000 | 20,974,000 | 22,935,000 | ||||
Value added tax on revenues | 17.00% | 16.00% | 13.00% | ||||
Value added tax on sub-licensing revenues | 6.00% | ||||||
Employee benefit costs | $ 7,949,000 | $ 12,337,000 | $ 12,501,000 | ||||
Statutory general reserve rate | 10.00% | ||||||
Statutory general reserve rate of registered capital | 50.00% | ||||||
Dividends declared | $ 0 | $ 0 | $ 0 | ||||
Income (Loss) from Equity Method Investments | $ (307,000) | ||||||
Right-of-use assets | $ 1,954,000 | $ 8,747,000 | 11,819,000 | ||||
Lease liabilities | 1,988,000 | 8,825,000 | |||||
Shenzhen Mojingou Information Service Co., Ltd [Member] | |||||||
Accounting Policies and General Information [Line Items] | |||||||
Income (Loss) from Equity Method Investments | 0 | 0 | 317,000 | ||||
Long-term Investments [Member] | |||||||
Accounting Policies and General Information [Line Items] | |||||||
Impairment of long-term investments | 794,000 | 19,830,000 | $ 7,794,000 | ||||
Income (Loss) from Equity Method Investments | $ 214,000 | $ 579,000 | |||||
Minimum | |||||||
Accounting Policies and General Information [Line Items] | |||||||
Term of time-based subscriptions | 1 month | ||||||
Maximum | |||||||
Accounting Policies and General Information [Line Items] | |||||||
Term of time-based subscriptions | 12 months | ||||||
Advertising contract term | 3 months | ||||||
Sales Revenue, Net [Member] | Geographic Concentration Risk [Member] | China [Member] | Minimum | |||||||
Accounting Policies and General Information [Line Items] | |||||||
Percent of revenue | 99.00% | 99.00% | 99.00% | ||||
Accounting Standards Update 2016-02 [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | Revision of Prior Period, Adjustment [Member] | |||||||
Accounting Policies and General Information [Line Items] | |||||||
Right-of-use assets | $ 11,800,000 | ||||||
Lease liabilities | $ 11,400,000 | ||||||
Land use right [Member] | |||||||
Accounting Policies and General Information [Line Items] | |||||||
Other intangible assets, amortization period | 30 years |
Summary of significant accoun_5
Summary of significant accounting policies - Schedule of Property and Equipment Estimated Useful Life (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Servers and network equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Residual rate | 5.00% |
Servers and network equipment [Member] | Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 3 |
Servers and network equipment [Member] | Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | P5Y |
Computer equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | P5Y |
Residual rate | 5.00% |
Furniture, fittings and office equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Residual rate | 5.00% |
Furniture, fittings and office equipment [Member] | Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 3 |
Furniture, fittings and office equipment [Member] | Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | P5Y |
Motor vehicles [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | P5Y |
Residual rate | 5.00% |
Leasehold improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | Shorter of lease term or 3 years |
Summary of significant accoun_6
Summary of significant accounting policies - Intangible assets (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Land use right [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful lives | 30 years |
Acquired computer software [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful lives | 5 years |
Audio visual licenses [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful lives | 9 years |
Minimum | Online game licenses [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful lives | 1 year |
Maximum | Online game licenses [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful lives | 3 years |
Summary of significant accoun_7
Summary of significant accounting policies - Analysis of Different Types of Revenues (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Net revenues | |||
Product revenue | $ 1,412 | $ 8,269 | $ 54,604 |
Live streaming revenue | 20,866 | 26,920 | 31,031 |
Total | 186,683 | 181,267 | 232,132 |
Subscription and circulation [Member] | |||
Net revenues | |||
Revenue from Contract with Customer, Including Assessed Tax | 84,299 | 81,532 | 81,877 |
Advertising | |||
Net revenues | |||
Revenue from Contract with Customer, Including Assessed Tax | 13,206 | 15,643 | 27,781 |
Product and Service, Other [Member] | |||
Net revenues | |||
Revenue from Contract with Customer, Including Assessed Tax | $ 66,900 | $ 48,903 | $ 36,839 |
Business combination (Details)
Business combination (Details) - Shanxian Daojia $ in Thousands | 1 Months Ended |
Sep. 30, 2020USD ($) | |
Business Acquisition [Line Items] | |
Percentage of equity acquired | 100.00% |
Cash consideration | $ 0 |
Business combination - Purchase
Business combination - Purchase price at the date of acquisitions (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Allocation of the purchase price at the date of acquisition | ||||
Goodwill | $ 22,607 | $ 20,382 | $ 20,717 | |
Shanxian Daojia | ||||
Allocation of the purchase price at the date of acquisition | ||||
Property and equipment, net | $ 17 | |||
Accrued liabilities and other payables | (798) | |||
Goodwill | $ 781 |
Discontinued operations - Addit
Discontinued operations - Additional Information (Details) | 1 Months Ended | |||
Jan. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2020CNY (¥) | Dec. 31, 2020USD ($) | |
Discontinued operations [Line Items] | ||||
Web game business period, after completion of disposal | 24 months | |||
Maximum | ||||
Discontinued operations [Line Items] | ||||
Period the Company will assist buyer with collection and payment of certain receivables and payables per Disposal Agreement | 1 year | |||
Web Game Business [Member] | ||||
Discontinued operations [Line Items] | ||||
Sales price | ¥ 4,180,000 | $ 640,000 |
Discontinued operations - Resul
Discontinued operations - Results of discontinued operations (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Operating expenses | |
Income tax expenses | $ (230) |
Web Game Business [Member] | |
Results of the discontinued operation | |
Revenues, net of rebates and discounts | 656 |
Business taxes and surcharges | (1) |
Net revenues | 655 |
Cost of revenues | (16) |
Gross profit | 639 |
Operating expenses | |
Research and development expenses | (419) |
Sales and marketing expenses | (63) |
General and administrative expenses | (18) |
Total operating expenses | (500) |
Operating income | 139 |
Gain on disposal of web game | 1,394 |
Income tax expenses | (230) |
Income from discontinued operations | 1,303 |
Cash flows generated from the discontinued operations | |
Net cash used in operating activities | 1,065 |
Net cash flow for the year | $ 1,065 |
Cash and cash equivalents - Add
Cash and cash equivalents - Additional Information (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Cash and cash equivalents | ||
Time Deposits, at Carrying Value | $ 27,200,000 | $ 34,000,000 |
Cash and cash equivalents - Sum
Cash and cash equivalents - Summary of Cash on Hand and Cash Held at Bank (Details) ฿ in Thousands, ¥ in Thousands, $ in Thousands, $ in Thousands | Dec. 31, 2020USD ($) | Dec. 31, 2020CNY (¥) | Dec. 31, 2020HKD ($) | Dec. 31, 2020THB (฿) | Dec. 31, 2019USD ($) | Dec. 31, 2019CNY (¥) | Dec. 31, 2019HKD ($) | Dec. 31, 2019THB (฿) |
Cash and Cash Equivalents [Line Items] | ||||||||
Cash on hand and cash held at bank | $ 137,248 | $ 162,465 | ||||||
RMB [Member] | ||||||||
Cash and Cash Equivalents [Line Items] | ||||||||
Cash on hand and cash held at bank | 47,906 | ¥ 312,581 | 46,296 | ¥ 322,972 | ||||
USD [Member] | ||||||||
Cash and Cash Equivalents [Line Items] | ||||||||
Cash on hand and cash held at bank | 89,050 | 115,805 | ||||||
HKD [Member] | ||||||||
Cash and Cash Equivalents [Line Items] | ||||||||
Cash on hand and cash held at bank | 224 | $ 1,737 | 283 | $ 2,202 | ||||
THB [Member] | ||||||||
Cash and Cash Equivalents [Line Items] | ||||||||
Cash on hand and cash held at bank | $ 68 | ฿ 2,052 | $ 81 | ฿ 2,417 |
Short-term investments - Schedu
Short-term investments - Schedule of Short-Term Investments (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Schedule of Investments [Line Items] | ||
Short-term investments | $ 117,821 | $ 102,847 |
Time deposits [Member] | ||
Schedule of Investments [Line Items] | ||
Short-term investments | 68,828 | 102,555 |
Investments in financial instruments [Member] | ||
Schedule of Investments [Line Items] | ||
Short-term investments | $ 48,993 | $ 292 |
Accounts receivable, net - Addi
Accounts receivable, net - Additional Information (Details) - customer | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number of top customers | 10 | |
Credit concentration risk [Member] | Accounts receivable [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable, percentage | 65.00% | 63.00% |
Accounts receivable, net - Sche
Accounts receivable, net - Schedule of Accounts Receivable (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Accounts receivable, net | ||||
Accounts receivable | $ 32,312,000 | $ 35,137,000 | ||
Less: Allowance for credit losses | (9,329,000) | (7,604,000) | $ (7,709,000) | $ (31,000) |
Accounts receivable, net | $ 22,983,000 | $ 27,533,000 |
Accounts receivable, net - Sc_2
Accounts receivable, net - Schedule of Allowance for Doubtful Accounts (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Accounts receivable, net | |||
Balance at beginning of the year | $ 7,604,000 | $ 7,709,000 | $ 31,000 |
Additions | 1,137,000 | 19,000 | 7,680,000 |
Exchange difference | 588,000 | (124,000) | (2,000) |
Balance at end of the year | $ 9,329,000 | $ 7,604,000 | $ 7,709,000 |
Inventories - Additional Inform
Inventories - Additional Information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Inventories | ||
Inventory Write-down | $ 3,283,000 | $ 3,523,000 |
Inventories - Schedule (Details
Inventories - Schedule (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Inventories [Line Items] | ||
Less: Impairment | $ (3,428) | $ (3,716) |
Inventories | 1,726 | 5,537 |
Hardware Devices [Member] | ||
Inventories [Line Items] | ||
Inventories | 4,830 | 9,091 |
Others [Member] | ||
Inventories [Line Items] | ||
Inventories | $ 324 | $ 162 |
Prepayments and other current_3
Prepayments and other current assets - Schedule of Prepayments and Other Assets (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Current portion: | ||
Advance to suppliers (note a) | $ 1,483,000 | $ 3,579,000 |
Receivable related to Linktoken disposal (note b) | 3,536,000 | |
Interest-free loans to employees (note c) | 1,896,000 | 3,185,000 |
Rental and other deposits | 1,670,000 | 1,990,000 |
Proceed receivable | 137,000 | 1,105,000 |
Prepayment for taxation | 112,000 | 936,000 |
Prepaid management insurance | 241,000 | 249,000 |
Advance to employees for business purposes | 86,000 | 211,000 |
Interest receivable | 2,000 | 4,000 |
Deposit related to an ongoing litigation | 4,751,000 | |
Others | 1,156,000 | 1,748,000 |
Total of prepayments and other current assets | 11,534,000 | 16,543,000 |
Non-current portion: | ||
Low-interest loans to employees, non-current portion (note c) | 905,000 | 313,000 |
Total of long-term prepayments and other assets | 905,000 | $ 313,000 |
Impairment provision recognised | $ 3,536,000 |
Prepayments and other current_4
Prepayments and other current assets - Schedule of Prepayments and Other Assets (Parenthetical) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Receivable related to Linktoken disposal | $ 3,536 | |
Employees [Member] | Minimum | ||
Term of interest-free loans to employees | 5 years | |
Employees [Member] | Maximum | ||
Term of interest-free loans to employees | 10 years |
Long-term investments - Additio
Long-term investments - Additional Information (Details) | 1 Months Ended | 12 Months Ended | ||
Oct. 31, 2020 | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Net unrealized gains on investments held | $ 794,000 | $ 10,907,000 | ||
Impairment of long-term investments | 794,000 | 19,831,000 | $ 7,794,000 | |
Shanghai Lexiang [Member] | ||||
Percentage of equity interest disposed | 4.82 | |||
Consideration for disposal of equity interest | $ 268,000 | |||
Net unrealized gains on investments held | 794,000 | |||
Impairment of long-term investments | $ 794,000 | |||
Chengdu Diting [Member] | ||||
Percent of equity interest owned | 12.74% | 12.74% | ||
Guangzhou Yuechuan [Member] | ||||
Percent of equity interest owned | 9.30% | 9.30% | ||
Zhuhai Qianyou [Member] | ||||
Percent of equity interest owned | 19.00% | 19.00% |
Long-term investments - Schedul
Long-term investments - Schedule of Long-Term Investments (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Equity method investments: | |||
Share of loss from equity investees | $ (307) | ||
Cost method investments: | |||
Balance at beginning of the year | $ 26,365 | $ 33,638 | |
Additions | 2,838 | ||
Disposal | (1,055) | ||
Net unrealized gains on investments held | 794 | 10,907 | |
Exchange difference | 369 | (132) | |
Less: impairment loss on long-term investments | (794) | (19,831) | |
Balance at end of the year | 26,734 | 26,365 | $ 33,638 |
Total long-term investments | $ 26,734 | $ 26,365 |
Long-term investments - Sched_2
Long-term investments - Schedule of Equity Investments, Percentage of Ownership of Common Share (Details) | Dec. 31, 2020 | Dec. 31, 2019 | |
Zhuhai Qianyou [Member] | |||
Equity method investments: | |||
Equity method investments, Percentage of ownership of common share | 19.00% | 19.00% | |
Big Data [Member] | |||
Equity method investments: | |||
Equity method investments, Percentage of ownership of common share | 28.77% | 28.77% | |
Guangzhou Yuechuan [Member] | |||
Equity method investments: | |||
Equity method investments, Percentage of ownership of common share | 9.30% | 9.30% | |
Shanghai Guozhi [Member] | |||
Cost method investments: | |||
Cost method investments, Percentage of ownership of common share | 16.80% | 16.80% | |
Guangzhou Hongsi [Member] | |||
Cost method investments: | |||
Cost method investments, Percentage of ownership of common share | 19.90% | 19.90% | |
Chengdu Diting [Member] | |||
Equity method investments: | |||
Equity method investments, Percentage of ownership of common share | 12.74% | 12.74% | |
Xiamen Diensi [Member] | |||
Cost method investments: | |||
Cost method investments, Percentage of ownership of common share | 14.25% | 14.25% | |
11.2 Capital [Member] | |||
Cost method investments: | |||
Cost method investments, Percentage of ownership of common share | 2.03% | 2.03% | |
Cloudtropy [Member] | |||
Cost method investments: | |||
Cost method investments, Percentage of ownership of common share | 9.69% | 9.69% | |
Tianjin Kunzhiyi [Member] | |||
Cost method investments: | |||
Cost method investments, Percentage of ownership of common share | [1] | 19.90% | |
Shanghai Lexiang [Member] | |||
Cost method investments: | |||
Cost method investments, Percentage of ownership of common share | [2] | 7.81% | 13.54% |
Hangzhou Feixiang [Member] | |||
Cost method investments: | |||
Cost method investments, Percentage of ownership of common share | 28.00% | 28.00% | |
Shenzhen Meizhi Interactive Technology Co Ltd [Member] | |||
Cost method investments: | |||
Cost method investments, Percentage of ownership of common share | 9.40% | 9.40% | |
Beijing Yunhui Tianxia [Member] | |||
Cost method investments: | |||
Cost method investments, Percentage of ownership of common share | 13.70% | 13.70% | |
Shen Zhen Arashi [Member] | |||
Cost method investments: | |||
Cost method investments, Percentage of ownership of common share | 8.73% | 8.73% | |
Beijing Cloudin Technology [Member] | |||
Cost method investments: | |||
Cost method investments, Percentage of ownership of common share | 4.12% | 4.12% | |
Quanxun Huiju [Member] | |||
Cost method investments: | |||
Cost method investments, Percentage of ownership of common share | 5.40% | 5.40% | |
[1] | The company has been deregistered in May 2020. | ||
[2] | In October 2020, the Group disposed 4.82% of the equity interest in Shanghai Lexiang, for which full impairment have been provided in December 2019, at a consideration of USD 268,000. The remaining equity interest in Shanghai Lexiang was remeasured based on this observable price change from the disposal, a fair value gain of USD 794,000 was recognized accordingly. |
Property and equipment - Schedu
Property and equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | $ 45,313 | $ 48,670 |
Less: Accumulated depreciation | (33,006) | (28,357) |
Less: Accumulated impairment | (3) | (4) |
Sub-total | 12,304 | 20,309 |
Construction in progress | 38,421 | 18,461 |
Total | 50,725 | 38,770 |
Servers and network equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | 35,827 | 39,130 |
Computer equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | 1,565 | 1,762 |
Furniture, fittings and office equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | 836 | 806 |
Motor vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | 481 | 406 |
Leasehold improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | $ 6,604 | $ 6,566 |
Property and equipment - Impair
Property and equipment - Impairment loss (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Property and equipment | |||
Impairment of Long-Lived Assets Held-for-use | $ 0 | $ 0 | $ 0 |
Reversal of impairment loss | $ 1,000 | $ 6,000 |
Property and equipment - Summar
Property and equipment - Summary of Depreciation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation expense | $ 9,277 | $ 5,824 | $ 5,595 |
Cost of revenue [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation expense | 6,247 | 5,198 | 5,018 |
Research and development expenses [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation expense | 529 | 300 | 331 |
General and administrative expenses [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation expense | 2,492 | 317 | 245 |
Sales and marketing expenses [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation expense | $ 9 | $ 9 | $ 1 |
Right-of-use assets and lease_3
Right-of-use assets and lease liabilities - Operating leases (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Right-of-use assets for long-term operating leases | ||
Beginning balance | $ 8,747,000 | $ 11,819,000 |
Additions | 500,000 | 3,830,000 |
Modification of operating lease | (3,825,000) | (1,107,000) |
Amortization | (3,685,000) | (5,634,000) |
Effect of foreign currency exchange differences | 217,000 | (161,000) |
Ending balance | 1,954,000 | 8,747,000 |
General and administrative expenses for long-term operating lease | 3,762,000 | 6,077,000 |
Charge recognized in relation to short-term lease | 291,000 | $ 301,000 |
Future minimum payments under non-cancellable short-term operating leases in 2020 | $ 119,000 | |
Discount rate related to operating lease (as a percent) | 5.40% | 5.50% |
Weighted average remaining lease term (in years) | 1 year | 2 years |
Cash payments in respect of operating lease | $ 3,797,000 | $ 5,149,000 |
Minimum | ||
Right-of-use assets and lease liabilities | ||
Operating lease, term of contract | 1 year | |
Maximum | ||
Right-of-use assets and lease liabilities | ||
Operating lease, term of contract | 3 years |
Right-of-use assets and lease_4
Right-of-use assets and lease liabilities - Undiscounted cash payment (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Undiscounted cash payment | ||
2020 | $ 5,034 | |
2021 | $ 1,998 | 3,000 |
2022 | 28 | 1,279 |
Total undiscounted payments | 2,026 | 9,313 |
Less: effect of discounting | (38) | (488) |
Discounted lease liabilities | $ 1,988 | $ 8,825 |
Intangible assets, net - Schedu
Intangible assets, net - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Finite-Lived Intangible Assets [Line Items] | ||
Cost | $ 14,639 | $ 18,691 |
Amortization | (5,782) | (8,548) |
Impairment | 0 | (717) |
Net book value | 8,857 | 9,426 |
Land use right [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 5,099 | 4,769 |
Amortization | (1,258) | (1,017) |
Impairment | 0 | |
Net book value | 3,841 | 3,752 |
Acquired computer software [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 3,530 | 2,391 |
Amortization | (2,853) | (1,433) |
Impairment | 0 | |
Net book value | 677 | 958 |
Online game licenses [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 0 | 5,910 |
Amortization | 0 | (5,193) |
Impairment | 0 | (717) |
Net book value | 0 | |
Audio visual licenses [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 6,010 | 5,621 |
Amortization | (1,671) | (905) |
Impairment | 0 | |
Net book value | $ 4,339 | $ 4,716 |
Intangible assets, net - Sche_2
Intangible assets, net - Schedule of Amortization Expense Recognized (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expense | $ 1,216 | $ 1,200 | $ 1,231 |
Cost of revenue [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expense | 5 | 266 | |
General and administrative expenses [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expense | 1,210 | 1,136 | 721 |
Research and development expenses [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expense | $ 6 | $ 59 | $ 244 |
Intangible assets, net - Sche_3
Intangible assets, net - Schedule of Estimated Aggregate Amortization Expense (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Intangible assets, net | |
2021 | $ 1,107 |
2022 | 1,050 |
2023 | 1,036 |
2024 | 972 |
2025 and thereafter | $ 4,692 |
Intangible assets, net - Sche_4
Intangible assets, net - Schedule of Weighted Average Amortization Periods of Intangible Assets (Details) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Finite-Lived Intangible Assets [Line Items] | ||
Weighted average amortization periods of intangible assets | 10 years | 12 years |
Land use right [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted average amortization periods of intangible assets | 30 years | 30 years |
Acquired computer software [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted average amortization periods of intangible assets | 5 years | 5 years |
Online game licenses [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted average amortization periods of intangible assets | 0 years | 3 years |
Audio visual licenses [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted average amortization periods of intangible assets | 9 years | 9 years |
Goodwill (Details)
Goodwill (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Goodwill [Roll Forward] | |||
Goodwill, Beginning Balance | $ 20,382,000 | $ 20,717,000 | |
Addition (note) | 815,000 | ||
Foreign currency translation adjustment | 1,410,000 | (335,000) | |
Goodwill, Ending Balance | 22,607,000 | 20,382,000 | $ 20,717,000 |
Impairment loss | $ 0 | $ 0 | $ 0 |
Contract liabilities and defe_3
Contract liabilities and deferred income - Schedule of Contract liabilities and deferred income (Detail) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 | |
Contract Liabilities And Deferred Income [Line Items] | |||
Deferred revenue and income, Total | $ 34,960,000 | $ 33,211,000 | |
Less: non-current portion | [1] | (920,000) | (1,223,000) |
Contract liabilities and deferred income, current portion | 34,040,000 | 31,988,000 | |
Membership subscription [Member] | |||
Contract Liabilities And Deferred Income [Line Items] | |||
Deferred revenue and income, Total | [2] | 31,981,000 | 29,769,000 |
Less: non-current portion | (751,000) | (781,000) | |
Government grants [Member] | |||
Contract Liabilities And Deferred Income [Line Items] | |||
Deferred revenue and income, Total | 466,000 | 1,300,000 | |
Less: non-current portion | (169,000) | (442,000) | |
Other deferred income [Member] | |||
Contract Liabilities And Deferred Income [Line Items] | |||
Deferred revenue and income, Total | [2] | $ 2,513,000 | $ 2,142,000 |
[1] | As of December 31, 2019 and 2020, the non-current portion consists of membership subscription of USD 781,000 and USD 751,000, and government grants of USD 442,000 and USD 169,000, respectively. | ||
[2] | Contract liabilities were related to unsatisfied performance obligations at the end of the year. Due to the generally short-term duration of the contracts, the majority of the performance obligations are satisfied in the following period. The amount of revenue recognized that was included in contract liabilities balance at the beginning of the year was USD 26,911,000 and USD 30,189,000 for the years ended December 31, 2019 and 2020, respectively. |
Contract liabilities and defe_4
Contract liabilities and deferred income - Schedule of Contract liabilities and deferred income (Parenthetical) (Detail) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 | |
Contract Liabilities And Deferred Income [Line Items] | |||
Contract Liabilities | $ 30,189,000 | $ 26,911,000 | |
Deferred revenue and income, non-current | [1] | 920,000 | 1,223,000 |
Membership subscription [Member] | |||
Contract Liabilities And Deferred Income [Line Items] | |||
Deferred revenue and income, non-current | 751,000 | 781,000 | |
Government grants [Member] | |||
Contract Liabilities And Deferred Income [Line Items] | |||
Deferred revenue and income, non-current | $ 169,000 | $ 442,000 | |
[1] | As of December 31, 2019 and 2020, the non-current portion consists of membership subscription of USD 781,000 and USD 751,000, and government grants of USD 442,000 and USD 169,000, respectively. |
Accrued liabilities and other_3
Accrued liabilities and other payables - Schedule of Accrued Liabilities and Other Payables (Detail) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Accrued liabilities and other payables | ||
Payroll and welfare((note | $ 12,871 | $ 14,995 |
Tax levies | 3,394 | 4,538 |
Payables related to Kankan | 2,581 | 3,733 |
Payables for advertisement | 1,895 | 3,606 |
Legal and litigation related expenses (note 28) | 1,640 | 2,765 |
Professional fees | 2,106 | 2,714 |
Agency commissions and rebates-online advertising | 2,696 | 2,521 |
Payables for construction in progress | 5,291 | 1,382 |
Tax surcharges | 1,095 | 1,076 |
Payables for technological services | 617 | 778 |
Payables for gaming distribution | 148 | 288 |
Deposits from customers | 229 | 225 |
Payables for proceeds from selling exercised stock options and restricted shares | 137 | 94 |
Payables for purchase of equipment | 29 | 21 |
Others | 3,960 | 4,104 |
Total | $ 38,689 | $ 42,840 |
Bank borrowings (Details)
Bank borrowings (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Debt Instrument [Line Items] | |||
Bank borrowings | $ 19,924,000 | $ 11,324,000 | |
Net interest expense capitalized | $ 890,000 | $ 470,000 | $ 0 |
Minimum | Loan Prime Rate | |||
Debt Instrument [Line Items] | |||
Spread on variable basis rate | 15.00% | ||
Maximum | Loan Prime Rate | |||
Debt Instrument [Line Items] | |||
Spread on variable basis rate | 30.00% |
Bank borrowings - Maturity of b
Bank borrowings - Maturity of bank borrowings (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Maturity of bank borrowings | |
Between 2 to 3 years | $ 747 |
Between 3 to 4 years | 996 |
Between 4 to 5 years | 996 |
Beyond 5 years | $ 17,185 |
Common shares - Additional Info
Common shares - Additional Information (Details) | 12 Months Ended | |
Dec. 31, 2020Vote$ / sharesshares | Dec. 31, 2019shares | |
Common shares | ||
Common stock, shares authorized | 1,000,000,000 | |
Common stock, par value | $ / shares | $ 0.00025 | |
Number of votes per common share | Vote | 1 | |
Common stock, shares outstanding | 334,401,981 | 339,165,241 |
Repurchase of shares - Summary
Repurchase of shares - Summary of the Shares Repurchased by the Company (Detail) - Share Buyback Program [Member] - USD ($) | 1 Months Ended | 12 Months Ended | ||||
Aug. 18, 2020 | Jul. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2020 | |
Equity, Class of Treasury Stock [Line Items] | ||||||
Share repurchase authorized amount | $ 20,000,000 | |||||
Total number of ADS Purchased | 334,245 | 857,147 | 1,191,392 | 0 | 0 | |
Average price paid per share | $ 3.86 | $ 3.72 | ||||
Approximate Dollar Value of ADSs that May Yet Be Purchased Under the Plan | $ 4,475,000 |
Share-based compensation - 2010
Share-based compensation - 2010 Plan (Detail) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Dec. 31, 2010 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Nov. 30, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares issued to depositary bank to reserve for future exercise of share options or vesting of restricted shares | 10,000,000 | ||||
Minimum | Share options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock award vesting period | 7 years | ||||
Maximum | Share options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock award vesting period | 10 years | ||||
2010 Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares available for grant | 11,284,463 | ||||
2010 Plan | Directors [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock award vesting period | 32 months | ||||
2010 Plan | Share options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unrecognized compensation costs on share options | $ 0 | $ 0 | |||
2010 Plan | Restricted shares | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Granted | 800,000 | 6,750,520 | |||
Number of restricted share vested | 965,500 | 1,296,540 | 267,630 | ||
Unrecognized compensation costs on restricted shares | $ 2,000,000 | $ 8,981,000 | |||
2010 Plan | Restricted shares | Officers and Employees [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Percent of options vesting monthly | 15.00% | ||||
2010 Plan | Restricted shares | Directors [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted shares expected to vest | 10,770,520 | 10,770,520 | |||
2010 Plan | Restricted shares | Nonemployee [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of restricted share vested | 60,000 | 60,000 | |||
2010 Plan | Restricted shares | Tranche One [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted shares expected to vest | 410,000 | ||||
2010 Plan | Restricted shares | Tranche Two [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted shares expected to vest | 390,000 | ||||
2010 Plan | Restricted shares | Tranche Three [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted shares expected to vest | 390,000 | ||||
2010 Plan | Restricted shares | Tranche Four [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted shares expected to vest | 70,000 | ||||
2010 Plan | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares available for grant | 26,822,828 |
Share-based compensation - 2013
Share-based compensation - 2013 Plan (Detail) - 2013 Plan - Restricted shares - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares available for grant | 9,073,732 | ||
Unrecognized compensation costs on restricted shares | $ 0 | $ 0 | |
Number of restricted share vested | 27,475 | 525,140 | |
Nonemployee [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of restricted share vested | 60,000 | 60,000 | |
Officers and Employees [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares available for grant | 8,664,980 | 8,664,980 |
Share-based compensation - 2014
Share-based compensation - 2014 Plan (Detail) - 2014 Plan - USD ($) | 1 Months Ended | 12 Months Ended | ||
Apr. 30, 2014 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Leading Advice Holdings Limited [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock Issued During Period, Shares, New Issues | 14,195,412 | |||
Restricted shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of restricted share vested | 228,200 | 1,318,450 | 2,086,450 | |
Unrecognized compensation costs on restricted shares | $ 12,000 | $ 766,000 | ||
Restricted shares | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares available for grant | 14,195,412 | |||
Restricted shares | Officers and Employees [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Restricted shares expected to vest | 14,536,000 | 14,536,000 | ||
Restricted shares | Tranche One [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Restricted shares expected to vest | 26,000 |
Share-based compensation - Summ
Share-based compensation - Summary of Stock Option Activity (Detail) - Share options - 2010 Plan - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Number of share options | ||||
Outstanding at beginning of period | 10,000 | 16,500 | 389,815 | |
Vested and expected to vest | 10,000 | 16,500 | 389,693 | |
Exercisable | 10,000 | 16,500 | 389,190 | |
Expired | (10,000) | (6,500) | (373,315) | |
Outstanding at end of period | 10,000 | 16,500 | 389,815 | |
Weighted average exercise price (USD) | ||||
Outstanding at beginning of period | $ 3.97 | $ 3.97 | $ 3.90 | |
Vested and expected to vest | 3.97 | 3.97 | $ 3.90 | |
Exercisable | 3.97 | 3.97 | 3.90 | |
Expired | $ 3.97 | 3.97 | 3.89 | |
Outstanding at end of period | 3.97 | 3.97 | 3.90 | |
Weighted average grant-date fair value (USD) | ||||
Vested and expected to vest | 1.01 | 1.56 | 0.95 | |
Exercisable | $ 1.01 | $ 1.56 | $ 0.95 | |
Share option activity - additional disclosures | ||||
Weighted-average remaining contractual life, vested and expected to vest | 0 years | 1 year 1 month 28 days | 1 year 4 months 13 days | 1 year 7 months 20 days |
Weighted-average remaining contractual life, exercisable | 0 years | 1 year 1 month 28 days | 1 year 4 months 13 days | 1 year 7 months 20 days |
Weighted-average remaining contractual life, outstanding | 0 years | 1 year 1 month 28 days | 1 year 4 months 13 days | 1 year 7 months 20 days |
Aggregate intrinsic value, vested and expected to vest | $ 0 | $ 0 | $ 0 | $ 0 |
Aggregate intrinsic value, exercisable | 0 | 0 | 0 | 0 |
Aggregate intrinsic value, outstanding | $ 0 | $ 0 | $ 0 | $ 0 |
Share-based compensation - Su_2
Share-based compensation - Summary of Restricted Shares Activities (Detail) - Restricted shares - $ / shares | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
2010 Plan | ||||
Number of restricted shares | ||||
Unvested at beginning of period | 5,184,500 | 6,652,040 | 1,272,150 | |
Granted | 800,000 | 6,750,520 | ||
Vested | (965,500) | (1,296,540) | (267,630) | |
Forfeited | (2,959,000) | (971,000) | (1,103,000) | |
Unvested at end of period | 1,260,000 | 5,184,500 | 6,652,040 | 1,272,150 |
Vested and expected to vest | 1,071,000 | 4,406,825 | 5,654,234 | 1,081,327 |
Weighted-Average Grant-Date Fair Value | ||||
Weighted-Average Grant Date Fair Value, Granted | $ 0.81 | $ 2.32 | ||
2013 Plan | ||||
Number of restricted shares | ||||
Unvested at beginning of period | 34,175 | 587,760 | ||
Vested | (27,475) | (525,140) | ||
Forfeited | (6,700) | (28,445) | ||
Unvested at end of period | 34,175 | 34,175 | 587,760 | |
Vested and expected to vest | 29,049 | |||
2014 Plan | ||||
Number of restricted shares | ||||
Unvested at beginning of period | 1,321,200 | 3,476,650 | 5,806,350 | |
Vested | (228,200) | (1,318,450) | (2,086,450) | |
Forfeited | (1,067,000) | (837,000) | (243,250) | |
Unvested at end of period | 26,000 | 1,321,200 | 3,476,650 | 5,806,350 |
Vested and expected to vest | 22,100 | 1,123,020 | 2,955,153 |
Share-based compensation - 2020
Share-based compensation - 2020 Plan (Detail) - 2020 Incentive Plan - shares | 12 Months Ended | |
Dec. 31, 2020 | Jun. 30, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Maximum aggregate number of shares that may be granted | 31,000,000 | |
Number of shares granted | 0 |
Share-based compensation - Sche
Share-based compensation - Schedule of Recognized Compensation Costs (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total compensation costs | $ 2,310 | $ 5,428 | $ 5,294 |
Sales and marketing expenses [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total compensation costs | 185 | 381 | 404 |
General and administrative expenses [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total compensation costs | 1,209 | 2,453 | 2,245 |
Research and development expenses [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total compensation costs | $ 916 | $ 2,594 | $ 2,645 |
Cost of revenues - Schedule of
Cost of revenues - Schedule of cost of revenuues (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Contract Liabilities And Deferred Income [Line Items] | |||
Cost of revenues | $ 92,637 | $ 99,913 | $ 115,667 |
Bandwidth costs [Member] | |||
Contract Liabilities And Deferred Income [Line Items] | |||
Cost of revenues | 62,384 | 57,093 | 48,118 |
Cost of inventories sold [Member] | |||
Contract Liabilities And Deferred Income [Line Items] | |||
Cost of revenues | 1,660 | 7,181 | 31,634 |
Cost of live streaming [Member] | |||
Contract Liabilities And Deferred Income [Line Items] | |||
Cost of revenues | 15,640 | 20,734 | 23,928 |
Depreciation of servers and other equipment [Member] | |||
Contract Liabilities And Deferred Income [Line Items] | |||
Cost of revenues | 6,247 | 5,198 | 5,018 |
Payment handling charges [Member] | |||
Contract Liabilities And Deferred Income [Line Items] | |||
Cost of revenues | 1,459 | 1,658 | 3,016 |
Other Cost of revenues [Member] | |||
Contract Liabilities And Deferred Income [Line Items] | |||
Cost of revenues | $ 5,247 | $ 8,049 | $ 3,953 |
Other income, net - Schedule of
Other income, net - Schedule of Other income, net (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Government subsidy income | $ 2,287 | $ 2,061 | $ 2,096 |
Net unrealized gains arising from long-term investments | 794 | 10,907 | |
Investment income | (307) | ||
Impairment of long-term investments | (794) | (19,831) | (7,794) |
Exchange gain/(loss), net | (2,948) | (402) | 1,216 |
Settlement income | 1,531 | 414 | |
Value-added tax deduction | 1,361 | 427 | |
Others | 880 | (61) | 1,061 |
Other income, net | 4,737 | 5,861 | 2,810 |
Linktoken program [Member] | |||
Gains from disposal of Linktoken program | 6,630 | ||
Short-term Investments [Member] | |||
Investment income | 2,943 | 4,020 | $ 5,817 |
Long-term Investments [Member] | |||
Investment income | $ 214 | $ 579 |
Taxation - Additional Informati
Taxation - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Giganology Shenzhen and Xunlei Computer [Member] | |||
Income Tax [Line Items] | |||
Withholding taxes on dividends paid | $ 10 | ||
PRC Enterprise [Member] | |||
Income Tax [Line Items] | |||
Effective income tax rate | 25.00% | ||
High And New Technology Enterprises [Member] | Shenzhen Xunlei, Onething, Wangwenhua and Xunlei Computer | |||
Income Tax [Line Items] | |||
Preferential tax rate (as a percent) | 15.00% | 15.00% | 15.00% |
State Administration of Taxation, China [Member] | Research And Development Enterprise Activities [Member] | Shenzhen Xunlei [Member] | |||
Income Tax [Line Items] | |||
Portion of research and development expenses incurred that are allowable as tax deductible expenses (as a percent) | 175.00% | ||
Domestic Tax Authority [Member] | |||
Income Tax [Line Items] | |||
Withholding tax rate on foreign enterprises | 10.00% | ||
Withholding tax accrued or required to be accrued | $ 0 | $ 0 | $ 0 |
Domestic Tax Authority [Member] | High And New Technology Enterprises [Member] | PRC Enterprise [Member] | |||
Income Tax [Line Items] | |||
Preferential tax rate (as a percent) | 15.00% | ||
Domestic Tax Authority [Member] | Software Enterprise [Member] | PRC Enterprise [Member] | |||
Income Tax [Line Items] | |||
Period of full exemption from income tax | 2 years | ||
Period of 50% reduction to income tax rate | 3 years | ||
Domestic Tax Authority [Member] | National Key Software Enterprise [Member] | PRC Enterprise [Member] | |||
Income Tax [Line Items] | |||
Preferential tax rate (as a percent) | 10.00% | ||
Foreign Tax Authority [Member] | Cayman Islands Tax Information Authority [Member] | |||
Income Tax [Line Items] | |||
Withholding taxes on dividends paid | $ 0 |
Taxation - Schedule of Current
Taxation - Schedule of Current and Deferred Portions of Income Tax Expense (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Taxation | |||
Current income tax (benefits)/expenses | $ 183 | $ 315 | $ (471) |
Deferred income tax expenses | 966 | 4,361 | 382 |
Income tax (benefits)/expenses | $ 1,149 | $ 4,676 | $ (89) |
Taxation - Summary of Aggregate
Taxation - Summary of Aggregate Amount and Per Share Effect of Tax Holiday (Detail) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Taxation | |||
Aggregate dollar effect (In thousands) | $ (197) | $ (3,856) | $ (3,776) |
Per share effect-basic | $ 0 | $ (0.01) | $ (0.01) |
Per share effect-diluted | $ 0 | $ (0.01) | $ (0.01) |
Taxation - Reconciliation of To
Taxation - Reconciliation of Total Tax (Benefits)/ Expenses (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Continuing operations | |||
Income tax benefit at PRC statutory rate (based on statutory tax rate applicable to enterprises in China) | $ (3,736) | $ (11,886) | $ (10,384) |
Effects of differences in tax rates in different jurisdictions applicable to entities of the Group outside of the PRC | 787 | 788 | 485 |
Non-deductible expenses | 101 | 228 | 245 |
Effect of Super Deduction | (733) | (1,920) | (881) |
Effect of tax holidays and tax concessions | (197) | 3,856 | 3,776 |
Change in valuation allowance of deferred tax assets | 4,704 | 13,180 | 6,720 |
Effect on deferred tax assets due to change in tax rates | (167) | ||
Expiration of tax loss | 84 | 400 | 562 |
Others | 139 | 30 | (445) |
Income tax (benefits)/expenses | $ 1,149 | $ 4,676 | $ (89) |
Taxation - Summary of Changes i
Taxation - Summary of Changes in Deferred Tax Asset and Liability Balances (Detail) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Deferred tax assets: | |||||
Net operating losses carried forward (note a) | [1] | $ 32,458,000 | $ 27,712,000 | ||
Impairment of long-term equity investment | 4,233,000 | 4,061,000 | |||
Impairment of other receivables | 1,858,000 | 1,553,000 | |||
Impairment of accounts receivable | 1,451,000 | 1,140,000 | |||
Impairment of inventories | 540,000 | 549,000 | |||
Allowance for advance to suppliers | 369,000 | 346,000 | |||
Impairment of property and equipment | 15,000 | 14,000 | |||
Valuation allowance | (40,924,000) | (34,257,000) | $ (20,181,000) | $ (16,599,000) | |
Total deferred tax assets, net | [2] | 1,118,000 | |||
Deferred tax liabilities: | |||||
Deferred credit arising from an asset acquisition | (1,085,000) | $ (1,179,000) | |||
Accumulated net operating loss which can be carried forward indefinitely | 3,079,000 | ||||
Accumulated net operating loss which can be carried forward and will expire during the period from 2021 to 2030 | $ 179,797,000 | ||||
[1] | As of December 31, 2020, the accumulated net operating loss of USD 3,079,000 of the Group’s subsidiaries incorporated in Hong Kong can be carried forward indefinitely to offset future taxable income, the remaining accumulated net operating loss of USD 179,797,000 mainly arose from the Company’s subsidiaries and consolidated VIEs established in the PRC, which can be carried forward to offset future taxable income and will expire during the period from 2021 to 2030. | ||||
[2] | As of December 31, 2019 and 2020, the deferred tax assets and liabilities balances are expected to be recoverable as follows: |
Taxation - Deferred Tax Assets
Taxation - Deferred Tax Assets and Deferred Tax Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | |
Deferred Tax Assets, Net [Abstract] | |||
Within one year | $ 133 | ||
After one year | 985 | ||
Total deferred tax assets, net | [1] | 1,118 | |
Deferred Tax Liabilities, Net [Abstract] | |||
Within one year | $ (176) | (165) | |
After one year | (909) | (1,014) | |
Total deferred tax liabilities | $ (1,085) | $ (1,179) | |
[1] | As of December 31, 2019 and 2020, the deferred tax assets and liabilities balances are expected to be recoverable as follows: |
Taxation - Schedule of Movement
Taxation - Schedule of Movement of Valuation Allowance (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Taxation | |||
Beginning balance | $ (34,257) | $ (20,181) | $ (16,599) |
Additions | (4,704) | (13,180) | (6,720) |
Exchange difference | (1,963) | (896) | 3,138 |
Ending balance | $ (40,924) | $ (34,257) | $ (20,181) |
Basic and diluted net loss pe_3
Basic and diluted net loss per share (Detail) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Numerator: | |||
Net loss from continuing operations | $ (14,140) | $ (53,415) | $ (40,793) |
Net income from discontinued operations | 1,303 | ||
Net loss for the year | (14,140) | (53,415) | (39,490) |
Less: Net loss attributable to the non-controlling interest | (300) | (246) | (212) |
Net loss attributable to Xunlei Limited | (13,840) | (53,169) | (39,278) |
Numerator of basic net loss per share from continuing operations | (13,840) | (53,169) | (40,581) |
Numerator of basic net income per share from discontinued operations | 1,303 | ||
Numerator for diluted loss per share from continuing operations | $ (13,840) | $ (53,169) | (40,581) |
Numerator for diluted income per share from discontinued operations | $ 1,303 | ||
Denominator: | |||
Denominator for basic net loss per share-weighted average shares outstanding | 337,429,601 | 337,845,675 | 334,965,987 |
Denominator for diluted net loss per share | 337,429,601 | 337,845,675 | 334,965,987 |
Basic net loss per share from continuing operations | $ (0.04) | $ (0.16) | $ (0.12) |
Basic net income per share from discontinued operations | 0 | ||
Diluted net loss per share from continuing operations | $ (0.04) | $ (0.16) | (0.12) |
Diluted net income per share from discontinued operations | $ 0 |
Related party transactions - Ad
Related party transactions - Additional Information (Detail) - USD ($) | 1 Months Ended | 12 Months Ended | ||||
Jan. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2014 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Schedule of Other Related Party Transactions [Line Items] | ||||||
Repayment of loans to related party | $ 662,000 | |||||
Treasury stock [Member] | ||||||
Schedule of Other Related Party Transactions [Line Items] | ||||||
Interest on withheld tax price | 5.00% | |||||
Aiden & Jasmine Limited | ||||||
Schedule of Other Related Party Transactions [Line Items] | ||||||
Withholding Tax Payable Non-current | 91,000 | $ 17,000 | $ 54,000 | |||
Aiden & Jasmine Limited | Treasury stock [Member] | ||||||
Schedule of Other Related Party Transactions [Line Items] | ||||||
Shares repurchased | 3,860,733 | |||||
Shares repurchased, value | $ 10,879,000 | |||||
Interest on withheld tax | 363,000 | |||||
Withholding Tax Payable Non-current | $ 1,451,000 | |||||
Vantage Point Global Limited | ||||||
Schedule of Other Related Party Transactions [Line Items] | ||||||
Withholding Tax Payable Non-current | [1] | $ 243,000 | $ 46,000 | $ 146,000 | ||
Vantage Point Global Limited | Treasury stock [Member] | ||||||
Schedule of Other Related Party Transactions [Line Items] | ||||||
Shares repurchased | 10,334,679 | |||||
Shares repurchased, value | $ 29,121,000 | |||||
Interest on withheld tax | 971,000 | |||||
Withholding Tax Payable Non-current | $ 3,883,000 | |||||
Vantage Point Global Limited | Subsequent event | ||||||
Schedule of Other Related Party Transactions [Line Items] | ||||||
Repayment of loans to related party | $ 3,883,000 | |||||
[1] | In 2014, the Group repurchased 3,860,733 common shares from Aiden & Jasmine Limited (Co founder’s company) for USD10,879,000 and 10,334,679 common shares from Vantage Point Global Limited for USD29,121,000. According to the repurchase contract, the Company was entitled to an amount (the “Withheld Price”) to withhold any taxes with respect to this repurchase as required under the applicable laws. If the Seller has not been specifically required by the applicable governmental or regulatory authority to pay any taxes as required under the applicable laws in connection with the repurchase, after the fifth anniversary of the Closing Date, the Company will pay to the Seller the Withheld Price with a simple interest thereon at the rate of five percent (5%) per annum from the Closing Date. Therefore, the Withheld Price for Aiden & Jasmine Limited and Vantage Point Global Limited was USD 1,451,000 (including interest of USD 363,000) and USD 3,883,000 (including interest of USD 971,000) respectively. The interest accrued for the year ended December 31, 2020 was USD 91,000 and USD 243,000 for Aiden & Jasmine Limited and Vantage Point Global Limited respectively. |
Related party transactions - Sc
Related party transactions - Schedule of Relationship Between Related Parties with their Groups (Detail) | 12 Months Ended |
Dec. 31, 2020 | |
Chuan Wang | |
Schedule of Other Related Party Transactions [Line Items] | |
Related parties relationship | Chairman and director of the Company (note i) |
Shenglong Zou | |
Schedule of Other Related Party Transactions [Line Items] | |
Related parties relationship | Co-founder, director and shareholder of the Company |
Weimin Luo | |
Schedule of Other Related Party Transactions [Line Items] | |
Related parties relationship | Director and Chief Operating Officer of the Company |
Shenzhen Crystal Technology Co., Ltd. | |
Schedule of Other Related Party Transactions [Line Items] | |
Related parties relationship | Company owned by a co-founder and director of the Company |
Vantage Point Global Limited | |
Schedule of Other Related Party Transactions [Line Items] | |
Related parties relationship | Shareholder of the Company |
Aiden & Jasmine Limited | |
Schedule of Other Related Party Transactions [Line Items] | |
Related parties relationship | Shareholder of the Company |
Millet Technology Co., Ltd. [Member] | |
Schedule of Other Related Party Transactions [Line Items] | |
Related parties relationship | Note ii |
Millet Communication Technology Co., Ltd. [Member] | |
Schedule of Other Related Party Transactions [Line Items] | |
Related parties relationship | Note ii |
Beijing Xiaomi Mobile Software Co., Ltd. ("Beijing Xiaomi Mobile Software") [Member] | |
Schedule of Other Related Party Transactions [Line Items] | |
Related parties relationship | Note ii |
Beijing Millet Payment Technologies Co., Ltd. ("Beijing Millet Payment Technologies") [Member] | |
Schedule of Other Related Party Transactions [Line Items] | |
Related parties relationship | Note ii |
Guangzhou Millet Information Service Co Ltd [Member] | |
Schedule of Other Related Party Transactions [Line Items] | |
Related parties relationship | Note ii |
Shenzhen Xiaomi Technology Co., Ltd. | |
Schedule of Other Related Party Transactions [Line Items] | |
Related parties relationship | Note ii |
Beijing Itui | |
Schedule of Other Related Party Transactions [Line Items] | |
Related parties relationship | Company owned by the principal shareholder of the Company (note iii) |
Itui Online | |
Schedule of Other Related Party Transactions [Line Items] | |
Related parties relationship | Company owned by the principal shareholder of the Company (note iii) |
Related party transactions - _2
Related party transactions - Schedule of Significant Related Party Transactions (Detail) - USD ($) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Schedule of Other Related Party Transactions [Line Items] | ||||
Repayment of loans to related party | $ 662,000 | |||
Advertising | ||||
Schedule of Other Related Party Transactions [Line Items] | ||||
Technology service revenue related party | 13,206,000 | $ 15,643,000 | $ 27,781,000 | |
Investee companies | ||||
Schedule of Other Related Party Transactions [Line Items] | ||||
Game sharing costs paid and payable to Zhuhai Qianyou | 9,000 | |||
Investee companies | Bandwidth | ||||
Schedule of Other Related Party Transactions [Line Items] | ||||
Cost for related party | 594,000 | |||
Beijing Xiaomi Mobile Software Co., Ltd. [Member] | Bandwidth | ||||
Schedule of Other Related Party Transactions [Line Items] | ||||
Revenue from related party | 1,815,000 | 4,254,000 | ||
Xiaomi Technology | ||||
Schedule of Other Related Party Transactions [Line Items] | ||||
Service Fees | [1] | 13,000 | 38,000 | |
Xiaomi Technology | Bandwidth | ||||
Schedule of Other Related Party Transactions [Line Items] | ||||
Revenue from related party | 2,211,000 | 875,000 | ||
Guangzhou Millet | Technology Service [Member] | ||||
Schedule of Other Related Party Transactions [Line Items] | ||||
Technology service revenue related party | 2,466,000 | 2,460,000 | 3,932,000 | |
Guangzhou Millet | Advertising | ||||
Schedule of Other Related Party Transactions [Line Items] | ||||
Revenue from related party | 19,000 | |||
Shenzhen Xunyi [Member] | Advertising | ||||
Schedule of Other Related Party Transactions [Line Items] | ||||
Revenue from related party | [2] | 493,000 | ||
Shenzhen Xunyi [Member] | Bandwidth | ||||
Schedule of Other Related Party Transactions [Line Items] | ||||
Revenue from related party | [2] | 160,000 | ||
Vantage Point Global Limited | ||||
Schedule of Other Related Party Transactions [Line Items] | ||||
Accrued to related party | [3] | 243,000 | 46,000 | 146,000 |
Aiden & Jasmine Limited | ||||
Schedule of Other Related Party Transactions [Line Items] | ||||
Accrued to related party | 91,000 | $ 17,000 | $ 54,000 | |
Beijing Itui | Advertising | ||||
Schedule of Other Related Party Transactions [Line Items] | ||||
Revenue from related party | 7,269,000 | |||
Itui Online | Bandwidth | ||||
Schedule of Other Related Party Transactions [Line Items] | ||||
Revenue from related party | 1,119,000 | |||
Shenzhen Xiaomi Technology Co., Ltd. | Advertising | ||||
Schedule of Other Related Party Transactions [Line Items] | ||||
Revenue from related party | 53,000 | |||
Weimin Luo | ||||
Schedule of Other Related Party Transactions [Line Items] | ||||
Repayment of loans to related party | $ 662,000 | |||
[1] | Onething Cloud devices were available for sale on the online platform operated by Xiaomi Technology starting from August 2018 till April 2019, during which Xiaomi Technology was entitled to receive service fees based on a certain percentage of sales on the platform. | |||
[2] | In 2018, a sales contract was entered into with Shenzhen Xunyi for provision of bandwidth and advertising services at a price benchmarking against market price, based on actual usage. | |||
[3] | In 2014, the Group repurchased 3,860,733 common shares from Aiden & Jasmine Limited (Co founder’s company) for USD10,879,000 and 10,334,679 common shares from Vantage Point Global Limited for USD29,121,000. According to the repurchase contract, the Company was entitled to an amount (the “Withheld Price”) to withhold any taxes with respect to this repurchase as required under the applicable laws. If the Seller has not been specifically required by the applicable governmental or regulatory authority to pay any taxes as required under the applicable laws in connection with the repurchase, after the fifth anniversary of the Closing Date, the Company will pay to the Seller the Withheld Price with a simple interest thereon at the rate of five percent (5%) per annum from the Closing Date. Therefore, the Withheld Price for Aiden & Jasmine Limited and Vantage Point Global Limited was USD 1,451,000 (including interest of USD 363,000) and USD 3,883,000 (including interest of USD 971,000) respectively. The interest accrued for the year ended December 31, 2020 was USD 91,000 and USD 243,000 for Aiden & Jasmine Limited and Vantage Point Global Limited respectively. |
Related party transactions - _3
Related party transactions - Schedule of Amount Due to from Related Party (Detail) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Schedule of Other Related Party Transactions [Line Items] | ||
Accounts payable to related party | $ 5,389 | $ 5,002 |
Accounts and other receivable from related party | 10,970 | 1,658 |
Guangzhou Millet | ||
Schedule of Other Related Party Transactions [Line Items] | ||
Accounts and other receivable from related party | 1,456 | 1,361 |
Xiaomi Technology | ||
Schedule of Other Related Party Transactions [Line Items] | ||
Accounts and other receivable from related party | 576 | 262 |
Due from Other Related Parties, Current | 15 | 14 |
Itui Online | ||
Schedule of Other Related Party Transactions [Line Items] | ||
Accounts and other receivable from related party | 1,153 | |
Beijing Itui | ||
Schedule of Other Related Party Transactions [Line Items] | ||
Accounts and other receivable from related party | 7,689 | |
Shenzhen Xiaomi Technology Co., Ltd. | ||
Schedule of Other Related Party Transactions [Line Items] | ||
Accounts and other receivable from related party | 60 | |
Shenzhen Crystal Technology Co., Ltd. | ||
Schedule of Other Related Party Transactions [Line Items] | ||
Due from Other Related Parties, Current | 6 | 6 |
Shenglong Zou | ||
Schedule of Other Related Party Transactions [Line Items] | ||
Due from Other Related Parties, Current | 9 | 9 |
Chuan Wang | ||
Schedule of Other Related Party Transactions [Line Items] | ||
Due from Other Related Parties, Current | 6 | 6 |
Investee companies | ||
Schedule of Other Related Party Transactions [Line Items] | ||
Accounts payable to related party | 55 | 2 |
Vantage Point Global Limited | ||
Schedule of Other Related Party Transactions [Line Items] | ||
Due to Other Related Parties, Current | 3,883 | 3,640 |
Aiden & Jasmine Limited | ||
Schedule of Other Related Party Transactions [Line Items] | ||
Due to Other Related Parties, Current | $ 1,451 | $ 1,360 |
Fair value measurements - Sched
Fair value measurements - Schedule of financial instruments measured at fair value (Detail) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Fair Value Of Assets And Liabilities Measured On Non Recurring Basis [Line Items] | ||
Fair value measurements, Short term investments | $ 117,821 | $ 102,847 |
Fair value measurements, Total | 48,993 | 292 |
Investments in financial instruments [Member] | ||
Fair Value Of Assets And Liabilities Measured On Non Recurring Basis [Line Items] | ||
Fair value measurements, Short term investments | 48,993 | 292 |
Significant other observable inputs (Level 2) [Member] | ||
Fair Value Of Assets And Liabilities Measured On Non Recurring Basis [Line Items] | ||
Fair value measurements, Total | 48,993 | 292 |
Significant other observable inputs (Level 2) [Member] | Investments in financial instruments [Member] | ||
Fair Value Of Assets And Liabilities Measured On Non Recurring Basis [Line Items] | ||
Fair value measurements, Short term investments | $ 48,993 | $ 292 |
Commitments and contingencies -
Commitments and contingencies - Additional Information (Detail) ¥ in Millions | Aug. 21, 2017USD ($)case | Aug. 21, 2017CNY (¥)case | Jan. 31, 2018case | Jan. 31, 2015case | Dec. 31, 2020USD ($)case | Dec. 31, 2020CNY (¥) | Dec. 31, 2019USD ($) | Dec. 31, 2019CNY (¥) | Dec. 31, 2018USD ($) | Apr. 22, 2020case |
Loss Contingencies [Line Items] | ||||||||||
Legal and litigation related expenses | $ | $ 1,955,000 | $ 4,667,000 | ||||||||
Legal expense reversed | $ | $ 1,217,000 | |||||||||
Number of lawsuits pending | 16 | |||||||||
Aggregate amount of claimed damages | $ | 1,900,000 | |||||||||
Legal and litigation related expenses | $ | $ 1,640,000 | 2,765,000 | ||||||||
Copyright Infringement [Member] | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Claims filed during the period | 28 | |||||||||
Number of video products included in lawsuits | 28 | |||||||||
Putative Shareholder Class Action [Member] | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Claims filed during the period | 2 | |||||||||
Pending Litigation [Member] | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Number of lawsuits pending | 16 | |||||||||
Aggregate amount of claimed damages | 1,900,000 | ¥ 13.3 | 11,900,000 | ¥ 82 | ||||||
Legal and litigation related expenses | $ | $ 1,640,000 | $ 2,765,000 | ||||||||
Pending Litigation [Member] | Copyright Infringement [Member] | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Number of lawsuits pending | 13 | |||||||||
Judicial Ruling [Member] | Copyright Infringement [Member] | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Number of trial cases after combination of lawsuits by court | 2 | 2 | ||||||||
Loss Contingency, Damages Awarded, Value | $ 200,000 | ¥ 1.4 |
Commitments and contingencies_2
Commitments and contingencies - Future Minimum Payments under Non-Cancellable Leases (Detail) - Bandwidth Purchase Commitments [Member] $ in Thousands | Dec. 31, 2020USD ($) |
Operating Leased Assets [Line Items] | |
2021 | $ 3,388 |
2022 | 406 |
Total | $ 3,794 |
Commitments and contingencies_3
Commitments and contingencies - Capital commitments (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Commitments and contingencies | |
2021 | $ 7,040 |
2022 | 0 |
2023 | 913 |
Unrecorded Unconditional Purchase Obligation | $ 7,953 |
Certain risks and concentrati_3
Certain risks and concentration - Additional Information (Detail) | 12 Months Ended | ||
Dec. 31, 2020USD ($)customer | Dec. 31, 2019USD ($) | Dec. 31, 2018 | |
Concentration Risk [Line Items] | |||
Maximum foreign ownership in internet information provider or other value-added telecommunication service provider's business allowed under PRC laws and regulations | 50.00% | ||
Retained earnings and distributable reserves | $ (181,095,000) | $ (166,973,000) | |
Number of top customers accounted for net revenues | customer | 10 | ||
Intercompany balance included in accounts payable | $ 30,439,000 | 21,297,000 | |
Accrued Liabilities and Other Liabilities, Inter-companies Balance | 152,611,000 | 152,904,000 | |
Amount of Restricted Net Assets for Consolidated and Unconsolidated Subsidiaries | 168,493,000 | ||
Variable Interest Entity, Primary Beneficiary [Member] | |||
Concentration Risk [Line Items] | |||
Accounts payable, consolidated variable interest entities and VIE's subsidiaries without recourse | 20,588,000 | 23,865,000 | |
Accrued liabilities and other payables, consolidated variable interest entities and VIE's subsidiaries without recourse | $ 33,361,000 | $ 38,502,000 | |
Shenzhen Xunlei | |||
Concentration Risk [Line Items] | |||
Term of operating contract | 10 years | ||
Sales Revenue, Net [Member] | Customer concentration risk [Member] | |||
Concentration Risk [Line Items] | |||
Percentage of net revenues accounted from customers | 38.00% | 31.00% | 23.00% |
Certain risks and concentrati_4
Certain risks and concentration - Schedule of Consolidated Financial Information of VIEs and VIE's Subsidiaries - Balance sheet (Detail) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Current assets: | ||||
Cash and cash equivalents | $ 137,248 | $ 162,465 | ||
Short-term investments | 117,821 | 102,847 | ||
Accounts receivable, net | 22,983 | 27,533 | ||
Due from related parties | 10,970 | 1,658 | ||
Inventories | 1,726 | 5,537 | ||
Prepayments and other current assets | 11,534 | 16,543 | ||
Total current assets | 302,282 | 316,583 | ||
Non-current assets: | ||||
Long-term investments | 26,734 | 26,365 | ||
Deferred tax assets | 1,118 | |||
Property and equipment, net | 50,725 | 38,770 | ||
Intangible assets, net | 8,857 | 9,426 | ||
Goodwill | 22,607 | 20,382 | $ 20,717 | |
Other long-term prepayments and non-current assets | 905 | 313 | ||
Right-of-use assets | 1,954 | 8,747 | $ 11,819 | |
Restricted cash | 1,541 | 2,983 | ||
Total assets | 415,605 | 424,687 | ||
Current liabilities: | ||||
Accounts payable (including inter-companies balances with the Company and its subsidiaries of USD 21,297 and USD 30,439 as of December 31, 2019 and 2020, respectively) | 20,644 | 24,213 | ||
Due to a related party | 5,389 | 5,002 | ||
Contract liabilities and deferred income, current portion | 34,040 | 31,988 | ||
Accrued liabilities and other payables (including inter-companies balances with the Company and its subsidiaries of USD 152,904 and USD 152,611 as of December 31, 2019 and 2020, respectively) | 38,689 | 42,840 | ||
Lease liabilities, current portion | 1,961 | 4,693 | ||
Total current liabilities | 103,276 | 111,286 | ||
Non-current liabilities: | ||||
Contract liabilities and deferred income, non-current portion | [1] | 920 | 1,223 | |
Deferred tax liabilities | 1,085 | 1,179 | ||
Lease liabilities, non-current portion | 27 | 4,132 | ||
Bank borrowings | 19,924 | 11,324 | ||
Total liabilities | 125,232 | 129,144 | ||
Variable Interest Entity, Primary Beneficiary [Member] | ||||
Current assets: | ||||
Cash and cash equivalents | 14,284 | 34,847 | ||
Short-term investments | 292 | |||
Accounts receivable, net | 32,485 | 30,686 | ||
Due from related parties | 10,955 | 1,644 | ||
Inventories | 1,726 | 5,330 | ||
Prepayments and other current assets | 15,712 | 20,747 | ||
Total current assets | 75,162 | 93,546 | ||
Non-current assets: | ||||
Long-term investments | 5,706 | 5,337 | ||
Deferred tax assets | 985 | |||
Property and equipment, net | 50,532 | 38,417 | ||
Intangible assets, net | 8,857 | 9,426 | ||
Goodwill | 22,607 | 20,382 | ||
Other long-term prepayments and non-current assets | 905 | 313 | ||
Right-of-use assets | 1,915 | 8,619 | ||
Restricted cash | 1,541 | 2,983 | ||
Total non-current assets | 92,063 | 86,462 | ||
Total assets | 167,225 | 180,008 | ||
Current liabilities: | ||||
Accounts payable (including inter-companies balances with the Company and its subsidiaries of USD 21,297 and USD 30,439 as of December 31, 2019 and 2020, respectively) | [2] | 51,027 | 45,162 | |
Due to a related party | 55 | 2 | ||
Contract liabilities and deferred income, current portion | 34,040 | 31,988 | ||
Income tax payable | 2,500 | 2,436 | ||
Accrued liabilities and other payables (including inter-companies balances with the Company and its subsidiaries of USD 152,904 and USD 152,611 as of December 31, 2019 and 2020, respectively) | [3] | 185,972 | 191,406 | |
Lease liabilities, current portion | 1,912 | 4,621 | ||
Total current liabilities | 275,506 | 275,615 | ||
Non-current liabilities: | ||||
Contract liabilities and deferred income, non-current portion | 920 | 1,223 | ||
Deferred tax liabilities | 1,085 | 1,179 | ||
Lease liabilities, non-current portion | 27 | 4,073 | ||
Bank borrowings | 19,924 | 11,324 | ||
Total non-current liabilities | 21,956 | 17,799 | ||
Total liabilities | $ 297,462 | $ 293,414 | ||
[1] | As of December 31, 2019 and 2020, the non-current portion consists of membership subscription of USD 781,000 and USD 751,000, and government grants of USD 442,000 and USD 169,000, respectively. | |||
[2] | Excluding the inter-companies balances with the Company and its subsidiaries of USD 21,297,000 and USD 30,439,000 , the balance of accounts payable as of December 31, 2019 and 2020, was USD 23,865,000 and USD 20,588,000 , respectively. | |||
[3] | Excluding the inter-companies balances with the Company and its subsidiaries of USD 152,904,000 and USD 152,611,000 , the balance of accrued liabilities and other payables as of December 31, 2019 and 2020 was USD 38,502,000 and USD 33,361,000 , respectively. |
Certain risks and concentrati_5
Certain risks and concentration - Schedule of Consolidated Financial Information of VIEs and VIE's Subsidiaries - Income Statement (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Net revenue from continuing operations | $ 186,371 | $ 180,665 | $ 230,604 |
Net loss attributable to Xunlei Limited | (13,840) | (53,169) | (39,278) |
Variable Interest Entity, Primary Beneficiary [Member] | |||
Net revenue from continuing operations | 186,413 | 177,520 | 231,616 |
Net loss attributable to Xunlei Limited | $ (10,673) | $ (56,328) | $ (40,728) |
Certain risks and concentrati_6
Certain risks and concentration - Schedule of Consolidated Financial Information of VIEs and VIE's Subsidiaries - Cash Flow (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Net (decrease)/increase in cash, cash equivalents and restricted cash | $ (31,988) | $ 45,788 | $ (104,036) |
Variable Interest Entity, Primary Beneficiary [Member] | |||
Net cash provided by/ (used in) operating activities | (21,008) | (16,047) | 7,548 |
Net cash used in investing activities | (9,160) | (5,001) | (7,925) |
Net cash provided by financing activities | 7,154 | 11,707 | 2,096 |
Net (decrease)/increase in cash, cash equivalents and restricted cash | $ (23,014) | $ (9,341) | $ 1,719 |
Additional information_ conde_3
Additional information: condensed financial statements of the Company - Schedule of Condensed Balance Sheets (Detail) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 137,248 | $ 162,465 |
Short-term Investments | 117,821 | 102,847 |
Prepayments and other current assets | 11,534 | 16,543 |
Total current assets | 302,282 | 316,583 |
Non-current assets: | ||
Total assets | 415,605 | 424,687 |
Current liabilities: | ||
Accounts payable | 20,644 | 24,213 |
Contract liabilities and deferred income, current portion | 34,040 | 31,988 |
Total current liabilities | 103,276 | 111,286 |
Total liabilities | 125,232 | 129,144 |
Commitments and contingencies | ||
Shareholders' equity | ||
Common shares | 84 | 85 |
Treasury shares (29,711,964 shares and 34,475,224 shares as of December 31, 2019 and 2020, respectively) | 8 | 7 |
Total Xunlei Limited's shareholders' equity | 292,154 | 296,878 |
Total liabilities and shareholders' equity | 415,605 | 424,687 |
Xunlei Limited [Member] | ||
Current assets: | ||
Cash and cash equivalents | 57,585 | 7,683 |
Short-term Investments | 47,525 | 102,555 |
Due from subsidiaries and consolidated VIEs | 279,043 | 277,241 |
Prepayments and other current assets | 860 | 274 |
Total current assets | 385,013 | 387,753 |
Non-current assets: | ||
Investments in subsidiaries and consolidated VIEs | (79,936) | (79,165) |
Total assets | 305,077 | 308,588 |
Current liabilities: | ||
Accounts payable | 55 | 55 |
Due to subsidiaries and consolidated VIEs | 10,750 | 9,737 |
Contract liabilities and deferred income, current portion | 1 | 1 |
Accrued liabilities and other payables | 2,118 | 1,918 |
Total current liabilities | 12,924 | 11,711 |
Total liabilities | 12,924 | 11,711 |
Shareholders' equity | ||
Common shares | 84 | 85 |
Treasury shares (29,711,964 shares and 34,475,224 shares as of December 31, 2019 and 2020, respectively) | 8 | 7 |
Other shareholders' equity | 292,061 | 296,785 |
Total Xunlei Limited's shareholders' equity | 292,153 | 296,877 |
Total liabilities and shareholders' equity | $ 305,077 | $ 308,588 |
Additional information_ conde_4
Additional information: condensed financial statements of the Company - Schedule of Condensed Balance Sheets (Parenthetical) (Detail) - shares | Dec. 31, 2020 | Dec. 31, 2019 |
Consolidated Balance Sheet Statements Captions [Line Items] | ||
Treasury stock, shares | 34,475,224 | 29,711,964 |
Xunlei Limited [Member] | ||
Consolidated Balance Sheet Statements Captions [Line Items] | ||
Treasury stock, shares | 34,475,224 | 29,711,964 |
Additional information_ conde_5
Additional information: condensed financial statements of the Company - Schedule of Condensed Statements of Operations (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Operating expenses | |||
Sales and marketing expenses | $ (18,064) | $ (31,820) | $ (35,322) |
General and administrative expenses | (33,910) | (38,930) | (40,833) |
Total operating expenses | (112,527) | (137,174) | (159,266) |
Operating loss | (18,793) | (56,422) | (44,329) |
Interest income | 1,471 | 1,897 | 1,183 |
Interest expense | (406) | (75) | (239) |
Other income, net | 4,737 | 5,861 | 2,810 |
Loss from continuing operations before income tax | (12,991) | (48,739) | (40,882) |
Income tax expenses | (1,149) | (4,676) | 89 |
Net loss | (14,140) | (53,415) | (39,490) |
Xunlei Limited [Member] | |||
Operating expenses | |||
Sales and marketing expenses | 0 | (1) | 0 |
General and administrative expenses | (1,438) | (1,247) | (1,483) |
Total operating expenses | (1,438) | (1,248) | (1,483) |
Operating loss | (1,438) | (1,248) | (1,483) |
Interest income | 2 | 1,496 | 879 |
Interest expense | (399) | (75) | (239) |
Other income, net | 2,455 | 4,712 | 4,646 |
(Loss)/income from subsidiaries and consolidated VIE - Continuing operations | (14,361) | (57,787) | (43,221) |
(Loss)/income from subsidiaries and consolidated VIE - Discontinued operations | 0 | 0 | 139 |
Loss from continuing operations before income tax | (13,741) | (52,902) | (39,279) |
Income tax expenses | (99) | (267) | 0 |
Net loss | (13,840) | (53,169) | (39,279) |
Net loss attributable to Xunlei Limited's common shareholders | $ (13,840) | $ (53,169) | $ (39,279) |
Additional information_ conde_6
Additional information: condensed financial statements of the Company - Schedule of Condensed Statement of Cash Flows (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from financing activities | |||
Net (decrease)/increase in cash, cash equivalents and restricted cash | $ (31,988) | $ 45,788 | $ (104,036) |
Cash, cash equivalents, and restricted cash at beginning of year | 165,448 | 122,930 | 233,479 |
Effect of exchange rates on cash and cash equivalents, and restricted cash | 5,329 | (3,270) | (6,513) |
Cash, cash equivalents, and restricted cash at end of year | 138,789 | 165,448 | 122,930 |
Xunlei Limited [Member] | |||
Cash flows from operating activities | |||
Net cash used in operating activities | (12,704) | (171,796) | (88,309) |
Cash flows from investing activities | |||
Net cash generated from investing activities | 12,051 | 52,359 | 37,788 |
Cash flows from financing activities | |||
Net cash used in financing activities | (4,475) | ||
Net (decrease)/increase in cash, cash equivalents and restricted cash | (5,128) | (119,437) | (50,521) |
Cash, cash equivalents, and restricted cash at beginning of year | 110,238 | 229,675 | 280,196 |
Effect of exchange rates on cash and cash equivalents, and restricted cash | 0 | 0 | 0 |
Cash, cash equivalents, and restricted cash at end of year | $ 105,110 | $ 110,238 | $ 229,675 |