DOUYU DEADLINE ALERT

Faruqi & Faruqi, LLP Encourages Investors Who Suffered Losses Exceeding $50,000 In DouYu International Holdings Limited To Contact The Firm - Seite 2

On July 29, 2019, the day before the incident was first reported, DouYu ADSs closed at $10.08 per ADS. After the market absorbed all this information, on August 6, 2019, DouYu ADSs closed at $7.84 per ADS: a drop of $2.24 or 22.22%.

Then, on August 11, 2019, Bloomberg published an article from the South China Morning Post, profiling Liu Mou (“Liu”), a top streamer who plays exclusively on DouYu and purportedly contributed as much as 3% of DouYu’s revenues in the second quarter of 2019 alone. In addition to explaining how DouYu lives and dies on virtual gifts from fans, with “[n]inety-one per cent of Douyu’s revenue [coming] from virtual gifts” in the previous quarter, the article warned that “the cash burn on marketing and retaining top performers has caused investors to question the business model.” [Emphasis added.] Using Liu as an example, the article noted how “Douyu pay[s] top gamers like Liu at least $4 million a year to retain them exclusively” and gives them half of whatever money was spent on “virtual gifts [bestowed upon them] from followers[.]”

On this news, the price of the Company’s ADSs fell from $9.93 per share on August 12, 2019 to $8.84 per share on August 13, 2020: a $1.09 or 10.98% drop.

Then, on October 15, 2019, J.P. Morgan announced in an analyst report that DouYu had temporarily removed its “lucky draw feature in late Aug 2019,” before “reinstat[ing]” it “on Oct 10,” which, according to J.P. Morgan, “will cause its 3Q19 revenue to decline 1.5% QoQ . . ., 5% below the low end of company’s 3Q19 guidance . . . and 7% lower than current Bloomberg consensus.” [Emphasis added.] According to J.P. Morgan, which characterized the suspension of luck draw features as a “headwind."

On this news, the price of the Company’s ADSs fell from $7.47 per share on October 15, 2019 to $7.12 per share on October 16, 2019: a $0.35 or 4.69% drop.

Finally, on November 27, 2019, DouYu released its third quarter 2019 financial results. During the Q&A portion of the earnings call held the same day, the Company addressed the temporary removal of its “lucky draw” features.

On this news, the price of the Company’s ADSs fell from $7.84 per share on November 27, 2019 to $7.46 per share on November 28, 2019: a $0.38 or 4.85% drop.

The court-appointed lead plaintiff is the investor with the largest financial interest in the relief sought by the class who is adequate and typical of class members who directs and oversees the litigation on behalf of the putative class. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. Your ability to share in any recovery is not affected by the decision to serve as a lead plaintiff or not.

Faruqi & Faruqi, LLP also encourages anyone with information regarding DouYu’s conduct to contact the firm, including whistleblowers, former employees, shareholders and others.

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