iQiyi Sets Sights on China’s $9.0 Billion Box Office

China’s booming movie market

iQiyi (IQ), often referred to as China’s Netflix, has set its sights on the country’s movie market, and for good reason. China has one of the world’s largest and fast-growing movie markets. Last year, the country’s box office expanded 9.0% YoY (year-over-year) to generate $9.0 billion in revenue, making it the largest movie market outside the US and Canada.

iQiyi Sets Sights on China’s $9.0 Billion Box Office

iQiyi founder and chief executive Yu Gong told CNBC last month that for the next two to three years, the company aims to focus on developing its movie business to take advantage of China’s massive box office. Gong said the company plans to release its original movies in theaters before bringing them to its video streaming platform.

Video streaming is iQiyi’s main business. iQiyi’s videos can be accessed through paid subscriptions or free with commercials, a mode similar to that of Google’s (GOOGL) YouTube. Netflix (NFLX) runs a purely paid subscription video service.

iQiyi’s revenue rose 43%

In the first quarter, revenue at iQiyi rose 43% YoY to $1.0 billion, and it rose 16% YoY at domestic video streaming competitor Tencent (TCEHY). iQiyi is mostly owned by Baidu (BIDU), China’s leading Internet search company.