Xunlei (XNET) Q2 2026 Earnings Call Transcript

Xunlei posted a $218.5 million net loss in Q2 2026 despite revenue climbing 38.9% year-over-year to $102.7 million. The loss stemmed primarily from fair value swings in its Arashi Vision stake, which the company is now working to reduce from 7.8% to meet investment regulations. XNET also reported a $4.8 million operating loss for the quarter.

Revenue growth was driven by subscription services and overseas audio live-streaming, but the shift came at a cost. Gross margin compressed to 55.8% from 63% in the prior-year period as the lower-margin live-streaming business claimed a larger share of the revenue mix.

Management announced a $20 million share repurchase program during the quarter.

The gap between top-line momentum and bottom-line deterioration highlights execution risk as XNET scales its international streaming operations. The forced reduction of the Arashi Vision position adds regulatory pressure to an already margin-challenged quarter.