Boasting 635 million mobile monthly average users, Cheetah Mobile, Inc. (NYSE: CMCM) is setting its sights on global expansion. On the company’s Q4 and year-end earnings call yesterday, Cheetah Mobile’s CEO indicated he would rely on India for user acquisition, through strategic tie-ups with the likes of Indian consumer electronics leader Micromax. That said, management emphasized the importance of focusing on user quality over aggressive growth.
Cheetah Mobile also announced its upcoming expansion to Silicon Valley, with the addition of a CTO, and a new share repurchase program for up to US$100 million shares in the company. Management noted the strength of its 1,600 person R&D department and indicated that new products would be rolled out in Q2. The company identified a key area of investment as its direct sales network for developed markets such as the U.S.
Cheetah Mobile’s management described India as a very attractive long-term market with a lot of potential. However, the company is mindful that the Indian market is still early in its development and intends to rely on organic growth for its India expansion plans. Despite having US$ 300 million of cash on its balance sheet, Cheetah Mobile will only selectively make small investments in India if they present themselves at attractive valuations.
© 2016 DaWall Street. All Rights Reserved.