500.com Posts Lousy Q1, Stock Price Jumps Anyways
This feat is even more impressive when you consider the fact that 500.com hasn’t generated revenue of any kind since March, when its business operations were suspended.
The company’s story is a great example of the incredible potential of regulated online gambling in China, as well as the incredible volatility of the Chinese stock market.
According to 500.com’s Q1 Earnings Report, sales were off by 32% over the previous year. That, combined with the fact that the number of Chinese using 500.com fell by a whopping 42.5% to less than a million users.
The earnings reports also notes the departure of company CEO, Man San Law. Though Law will remain at 500.com in the Chairman position, the reasons for his departure are still not entirely clear.
In any normal market, this slate of bad news would be enough to send stock prices swirling into oblivion, but China is not currently anyone’s definition of a normal market. China is currently in the throes of a stock market boom that’s minted millions of new stock owners who don’t seem to mind bad news much at all.
Upon news of the earnings report, 500.com’s stock absolutely caught fire and had spiked by as much as 25% during the course of Tuesday’s trading. Considering that 500.com stock was down as much as 37% over the course the last 12 months, that feat is even more impressive.
500.com’s strange story is evidence of the incredible potential, and incredible volatility, the Chinese online gambling market could offer…if it’s ever fully opened.