Hall of Shame

Communication Services

Qutoutiao (QTT US)

Year: 2019

Qutoutiao Inc. is a Chinese company that operates as a mobile content platform company. The Company develops mobile application "Qutoutiao" providing aggregates articles and short videos and presents customized feeds to users. Qutoutiao also launches mobile literature application "Midu Novels" in offering users free literature supported by advertising.

It listed in the US in September 2018, raising US$84m, then, in March 2019, Alibaba injected $171 million in a convertible loan to Qutoutiao, converted into about 11.4 million shares, representing about 4 percent of Qutoutiao.

In Dec 10, 2019, Wolfpack Research's report, "QTT: Fake Revenue, Non-Existent Cash, Undisclosed Related Parties", the analysis of  Qutoutiao's finances & operations, in summary showed :

  1. 74% of QTT’s 2018 revenues are fake
  2. 78% of its current cash balance is non-existent
  3. removed independent third-party oversight of its advertising traffic and replaced it with its own in-house “advertising agent,”  Thus allowing QTT to begin directing advertising traffic wherever it wanted. QTT wanted to direct traffic to undisclosed related parties owned by QTT’s CEO
  4. Nearly 50% of QTT’s Ads Came from Undisclosed Related Parties, or QTT Itself.
  5. QTT’s App is a Malware (Spyware) nightmare
  6. QTT’s “Loyalty Program” Creates Fake Ad Traffic and User Growth

On December 27, 2019, QTT issued a response to the report with a headline stating that it was “false and misleading,”

On the 17th January 2020, Wolfpack responed via it's second report,"QTT’s Top 12 Lies and Omissions for the New Year"  noting that they had responded poorly to only a few points, while ignoring arguably the most serious issues brought up. QTT only addressed seven points and did so with explanations that were, in thier view, vague and, in some cases, contained blatant material misrepresentations.

Jan 22, 2020 - Mr. Jingbo Wang resigned as Director and Chief Financial Officer of the Company due to personal reasons. 

Wolfpack Research: QTT: Fake Revenue, Non-Existent Cash, Undisclosed Related Parties, 10 Dec 2019
Wolfpack Research: QTT’s Top 12 Lies and Omissions for the New Year, 17 Dec 2020
Capital Watch: Short-seller Calls Qutoutiao a 'Low-Tech China Hustle' but Stock Rebounds, 10 Dec 2019
Capital Watch: Qutoutiao Refutes Short-seller Report but Faces More Trouble at Home, 27 Dec 2019
Qutoutiao:  Annual Report 2018
Qutoutiao:  Prospectus issued 2018