VNET Group Inc ADR (VNET)

VNET Group Inc - ADR Stock (VNET) dropped by 26.27% from $3.54 to $2.61 in the trading on Thursday November 16, 2023. The reasons why VNET stock down today include:

• Mixed third-quarter 2023 results: VNET's non-GAAP adjusted EBITDA grew 11.6% year-over-year to RMB507.9 million in Q3 2023, marginally exceeding analyst expectations. However, the company's revenue fell short of estimates, reaching RMB1,886.9 million, marking a 3.2% year-over-year slowdown.
• Lowering of full-year guidance: VNET's downward revision of its full-year guidance, including a 3.2% cut to revenue expectations, sent shockwaves through the market, causing its stock price to tumble 26% on Thursday. The company attributed the reduced outlook to its exit from low-profit businesses and a shift towards high-profit areas. Despite the earnings miss, VNET's projected FY 2023 EBITDA expansion of 8.4% remains better than the company's FY 2022 EBITDA increase of 6.8%.
• $299 million investment: VNET announced that it has secured a US$299 million investment from Success Flow International Investment Limited and Choice Faith Group Holdings Limited, both beneficially owned by Shandong Hi-Speed Holdings Group Limited (SDHG). The investment will be made in the form of equity and will help VNET expand its business and explore new opportunities.