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424B4
IQIYI, INC. filed this Form 424B4 on 03/29/2018
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foreign exchange administration mechanism as provided in the PBOC Notice No. 9, or the Notice No. 9 Foreign Debt mechanism, the risk-weighted outstanding amount of the loans, which shall be calculated based on the formula provided in the PBOC Notice No. 9, shall not exceed 200% of the net asset of the relevant PRC subsidiary. According to the PBOC Notice No. 9, after a transition period of one year since the promulgation of the PBOC Notice No. 9, the PBOC and SAFE will determine the cross-border financing administration mechanism for the foreign-invested enterprises after evaluating the overall implementation of the PBOC Notice No. 9. As of the date hereof, neither PBOC nor SAFE has promulgated and made public any further rules, regulations, notices or circulars in this regard. It is uncertain which mechanism will be adopted by PBOC and SAFE in the future and what statutory limits will be imposed on us when providing loans to our PRC subsidiaries.

A majority of our future revenues are likely to continue to be in the form of Renminbi. Under existing PRC foreign exchange regulations, Renminbi may be converted into foreign exchange for current account items, including profit distributions, interest payments and trade-and service related foreign exchange transactions.

Our PRC subsidiaries may convert Renminbi amounts that they generate in their own business activities, including technical consulting and related service fees pursuant to their contracts with the consolidated affiliated entities, as well as dividends they receive from their own subsidiaries, into foreign exchange and pay them to their non-PRC parent companies in the form of dividends. However, current PRC regulations permit our PRC subsidiaries to pay dividends to us only out of their accumulated profits, if any, determined in accordance with PRC accounting standards and regulations. Each of our PRC subsidiaries is required to set aside at least 10% of its after-tax profits after making up previous years’ accumulated losses each year, if any, to fund certain reserve funds until the total amount set aside reaches 50% of its registered capital. These reserves are not distributable as cash dividends. Furthermore, capital account transactions, which include foreign direct investment and loans, must be approved by and/or registered with SAFE and its local branches. The total amount of loans we can make to our PRC subsidiaries cannot exceed statutory limits and must be registered with the local counterpart of SAFE. The statutory limit for the total amount of foreign debts of a foreign-invested company is the difference between the amount of total investment as approved by the MOFCOM and the amount of registered capital of such foreign-invested company.

The following table sets forth a summary of our cash flows for the years indicated.

 

     For the Year Ended December 31,  
     2015     2016     2017  
     RMB     RMB     RMB      US$  
     (in thousands)  

Summary Consolidated Cash Flow Data:

         

Net cash provided by operating activities

     1,070,770       2,612,121       4,011,784        616,594  

Net cash used for investing activities

     (3,133,375     (6,663,100     (10,660,674)        (1,638,515)  

Net cash (used in)/provided by financing activities

     (131,708     3,411,766       6,561,110        1,008,424  

Effect of exchange rate changes on cash and cash equivalents

     71,951       14,681       (143,417)        (22,037)  
  

 

 

   

 

 

   

 

 

    

 

 

 

Net decrease in cash and cash equivalents

     (2,122,362     (624,532     (231,197)        (35,534)  

Cash and cash equivalents at the beginning of the year

     3,711,101       1,588,739       964,207        148,196  

Cash and cash equivalents at the end of the year

     1,588,739       964,207       733,010        112,662  
  

 

 

   

 

 

   

 

 

    

 

 

 

Net cash provided by operating activities

Net cash provided by operating activities increased from RMB2,612.1 million in 2016 to RMB4,011.8 million (US$616.6 million) in 2017 primarily due to the combined effect of increase in net loss, as adjusted for

 

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