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XNET, Xunlei Limited

Software asset-light

Our ADSs currently trade on The Nasdaq Global Select Market under the symbol "XNET."

Latest annual: FY2025 20-F · 1 ADS = 5 ordinary shares

XNET · Xunlei Limited

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$460M

+42.5% YoY · 20% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $460M 5-yr avg $346M

Gross margin 47% 5-yr avg 47%

Operating margin 1.4% 5-yr avg −0.5%

ROIC 1% 5-yr avg −1%

Owner-earnings margin 6% 5-yr avg 8%

Free cash flow margin 6% 5-yr avg 6%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

What it is: Revenue is Xunlei (96%) and Hupu (4%).
What moves the needle: Operating margin has run around −10% through the cycle on a 45% gross margin, the operating line in the red even at its best — so the lever is whether the spending below the gross line can come down enough to clear a profit: revenue growth against the cost curve, and the cash runway until it does. The cash cycle has run negative through the cycle (a median of −14 days): the operation is paid before it pays, so working capital releases cash as the business grows rather than tying it up. Read this kind of business on retention and the cost of growth. On its own account, the filing leans hardest on debt terms & refinancing, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has rarely cleared the cost of capital (median −8%, above 15% in 0 of 10 years). The steadier read is owner earnings: roughly 6% of revenue reaches owners as cash, though it swings, and customers and suppliers fund the business through negative working capital. This is price-taker territory, where the balance sheet and the cycle matter more than any multiple; the rest is in the 10-K.

Every line is arithmetic on the company's filings, shown in full in the sections below.

Where the money comes from

read the 20-F →

The largest slice of sales is Xunlei at 96%, but the profit engine is Hupu: 4% of revenue and 76% of segment operating profit.

Revenue by reportable segment, FY2025

Operating profit same segments

Xunlei96%$442M24% of profit
Hupu4%$20M76% of profit

From the segment footnote of the company's own 20-F. Shares are of total revenue; the profit bar shows each segment's share of segment operating profit, before unallocated corporate costs.

The record

Ten years of arithmetic, read across the cycle.

The record, 2016–2025

realized figures from each filing · older years to the left

2016’16	2017’17	2018’18	2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMDec 2025
											Income statement
$140M	$201M	$231M	$181M	$186M	$239M	$341M	$364M	$323M	$460M	$460M	RevenueRevenue
43%	41%	50%	45%	50%	50%	41%	45%	52%	47%	47%	Gross marginGross mgn
($42M)	($54M)	($44M)	($56M)	($19M)	($4M)	$10M	($2M)	($16M)	$7M	$7M	Operating incomeOp. inc.
−29.6%	−27.0%	−19.2%	−31.2%	−10.1%	−1.8%	2.9%	−0.4%	−4.9%	1.4%	1.4%	Operating marginOp. mgn
($24M)	($38M)	($39M)	($53M)	($14M)	$1M	$21M	$14M	$663K	$1.0B	$1.0B	Net incomeNet inc.
—	—	—	—	—	—	16%	22%	—	-0%	-0%	Effective tax rateTax rate
											Cash flow & returns
$17M	($14M)	($36M)	($46M)	($14M)	$19M	$51M	$26M	$31M	$32M	$32M	Operating cash flowOp. cash
$6M	$8M	$6M	$6M	$9M	$6M	$3M	$4M	$5M	$5M	$5M	DepreciationDeprec.
$35M	$16M	($2M)	$2M	($9M)	$12M	$27M	$7M	$26M	($1.0B)	($1.0B)	Working capital & otherWC & other
$14M	$5M	$1M	$3M	$14M	$13M	$15M	$4M	$8M	$5M	$5M	CapexCapex
9.8%	2.7%	0.6%	1.7%	7.3%	5.5%	4.4%	1.1%	2.5%	1.2%	1.2%	Capex / revenueCapex/rev
$11M	($20M)	($37M)	($49M)	($23M)	$13M	$48M	$22M	$26M	$27M	$27M	Owner earningsOwner earn.
7.7%	−9.7%	−16.1%	−27.0%	−12.4%	5.5%	14.2%	6.0%	8.1%	5.9%	5.9%	Owner earnings marginOE mgn
$3M	($20M)	($37M)	($49M)	($27M)	$6M	$36M	$22M	$23M	$27M	$27M	Free cash flowFCF
2.3%	−9.7%	−16.1%	−27.0%	−14.7%	2.6%	10.6%	6.0%	7.1%	5.9%	5.9%	Free cash flow marginFCF mgn
-16%	-28%	-16%	-31%	-8%	-2%	6%	-1%	-7%	1%	1%	ROICROIC
-6%	-10%	-11%	-18%	-5%	0%	7%	4%	0%	76%	76%	Return on equityROE
−6%	−10%	−11%	−18%	−5%	0%	7%	4%	0%	76%	76%	Retained to equityRetained/eq
											Balance sheet
$381M	$372M	$319M	$265M	$255M	$239M	$261M	$272M	$288M	$305M	$305M	Cash & investmentsCash+inv
$15M	$41M	$19M	$28M	$23M	$26M	$30M	$31M	$33M	$68M	$68M	ReceivablesReceiv.
$374K	$4M	$13M	$6M	$2M	$1M	$457K	$2M	$1M	$403K	$403K	InventoryInvent.
$33M	$50M	$23M	$24M	$21M	$26M	$25M	$24M	$23M	$42M	$42M	Accounts payablePayables
($18M)	($5M)	$9M	$9M	$4M	$1M	$5M	$9M	$11M	$27M	$27M	Operating working capitalOper. WC
$412M	$431M	$363M	$317M	$302M	$294M	$332M	$327M	$363M	$400M	$400M	Current assetsCur. assets
$93M	$142M	$108M	$111M	$103M	$120M	$128M	$128M	$127M	$208M	$208M	Current liabilitiesCur. liab.
4.4×	3.0×	3.4×	2.8×	2.9×	2.5×	2.6×	2.6×	2.9×	1.9×	1.9×	Current ratioCurr. ratio
$20M	$22M	$21M	$20M	$23M	$23M	$21M	$21M	—	$39M	$39M	GoodwillGoodwill
$510M	$533M	$455M	$425M	$416M	$441M	$463M	$469M	$474M	$1.6B	$1.6B	Total assetsAssets
—	—	—	$11M	$20M	—	—	$22M	$28M	$42M	$42M	Total debtDebt
—	—	—	($254M)	($235M)	—	—	($249M)	($260M)	($263M)	($263M)	Net debt / (cash)Net debt
$408M	$385M	$345M	$297M	$292M	$304M	$310M	$325M	$318M	$1.4B	$1.4B	Shareholders’ equityEquity
											Per share
334M	332M	335M	338M	337M	336M	336M	327M	319M	316M	314M	Shares out (diluted)Shares
$0.42	$0.60	$0.69	$0.53	$0.55	$0.71	$1.02	$1.11	$1.01	$1.45	$1.47	Revenue / shareRev/sh
$-0.07	$-0.11	$-0.12	$-0.16	$-0.04	$0.00	$0.06	$0.04	$0.00	$3.31	$3.33	EPS (diluted)EPS
$0.03	$-0.06	$-0.11	$-0.14	$-0.07	$0.04	$0.14	$0.07	$0.08	$0.09	$0.09	Owner earnings / shareOE/sh
$0.01	$-0.06	$-0.11	$-0.14	$-0.08	$0.02	$0.11	$0.07	$0.07	$0.09	$0.09	Free cash flow / shareFCF/sh
$0.04	$0.02	$0.00	$0.01	$0.04	$0.04	$0.04	$0.01	$0.03	$0.02	$0.02	Cap. spending / shareCapex/sh
$1.22	$1.16	$1.03	$0.88	$0.87	$0.90	$0.92	$0.99	$1.00	$4.34	$4.37	Book value / shareBVPS

Per-share growththe realized rate an owner's share compounded

	9-yr	5-yr
Revenue / share	+14.8%/yr	+21.4%/yr
Owner earnings / share	+11.4%/yr	—
Capital spending / share	−9.4%/yr	−15.9%/yr
Book value / share	+15.1%/yr	+38.0%/yr

The record, charted

FY2016–2025

Each measure over its full record; the current point and the worst year marked.

Share count

316Mpeak FY2019

ROIC

1%low FY2019

Gross margin

47%low FY2017

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

$27Mowner earningsvs.$1.0Bnet incomelow FY2019

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetained

Each year's operating cash, by what management did with it: the mix, and how it drifts.

FY2016FY2025

Owner-earnings bridge

FY2021–FY2025cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2025 the business reported $1.0B of profit but $27M of owner earnings: $1.0B less than the profit line, taken out by capital spending and the timing of cash.

Reported net income$1.0B

Owner earnings$27M · 6% of revenue

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	$1.0B	$663K	$14M	$21M	$1M
Depreciation & amortizationnon-cash charge added back	+$5M	+$5M	+$4M	+$3M	+$6M
Working capital & othertiming of cash in and out, other non-cash items	−$1.0B	+$26M	+$7M	+$27M	+$12M
Cash from operations	$32M	$31M	$26M	$51M	$19M
Maintenance capital expenditurethe spending needed just to hold position and volume	−$5M	−$5M	−$4M	−$3M	−$6M
Owner earnings	$27M	$26M	$22M	$48M	$13M
Growth capital expenditurediscretionary; spent to get bigger, not to stand still	—	−$3M	—	−$12M	−$7M
Free cash flow	$27M	$23M	$22M	$36M	$6M
Owner-earnings marginowner earnings ÷ revenue	6%	8%	6%	14%	6%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position .

Much of fiscal 2025's profit didn't arrive as operating cash; it sits in “working capital & other” above. That can be a real inventory or timing swing, or profit that doesn't run through operating cash at all: a heavy tax year, equity-method earnings, or investment income booked through investing. For a year like this, owner earnings understates the cash earned; the full cash-flow statement carries the rest.

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 20-F · source on SEC EDGAR →

Will it survive?

Can it pay its interest? 3.9×

Adequate

Operating income $7M ÷ interest expense $2M

What this means
Comfortable in a normal year, but below the margin of safety Graham looked for. Worth checking how stable the coverage has been across a full cycle.
How heavy is the debt, net of cash? +$263M

Net cash

Cash $157M + ST investments $148M − debt $42M

What this means
Cash and short-term investments exceed every dollar of debt by $263M, on net the company owes nothing, and can act from strength when others can't. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? -8d

Negative, funded by others

DSO 54 + DIO 1 − DPO 63 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. A negative cycle is a quiet moat: suppliers and customers fund the operation (Buffett's “float”), the company grows on other people's money.

Is it a good business?

Return on invested capital -8%

Below average through the cycle

10-yr median, range -31%–6%; 1% latest = NOPAT $7M ÷ invested capital $1.3B

Industry peers: median -23%

What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 10 years (it ran 1% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
Owner-earnings margin 6%

Solid through the cycle

10-yr median margin, range -27%–14%; latest $27M = operating cash $32M − maintenance capex $5M

Industry peers: median 2%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 6% of revenue this year, a 6% median across 10 years.
Are earnings backed by cash? 0.03×

Thinly cash-backed

Cash from ops $32M ÷ net income $1.0B

What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

Where do the earnings go? —

Not enough data

What this means
The filing data didn't include the inputs for this check.
Investing or harvesting? 1.08×

Maintaining

Capex $5M ÷ depreciation $5M

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 1 of 5 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Miss

Revenue ≥ $2B · $460M

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Near

Current ratio ≥ 2× · 1.92×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Conservative debt Pass

Debt ≤ working capital · $42M vs $191M WC

What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
Earnings stability Miss

A profit every year (10-yr record) · 5 loss years

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Miss

Uninterrupted dividends · none paid

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth —

Earnings +33% over the record · —

What this means
Earnings were negative early in the record, a growth rate isn't meaningful.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $1.13/share (latest year $3.33), the averaged base the calculator's gate runs on, and book value is $4.37/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2016–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 5 of 10

What this means
Lost money in 5 year(s), look at what happened there before trusting the average.
Return on capital ≥ 15% 0 of 5 yrs

What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
Operating margin −25% → −1% (3-yr avg ends)

What this means
Through the cycle the operating margin widened — about −25% early to −1% lately, median −10% — pricing power intact or improving.
Reinvestment, incremental ROIC 9%

What this means
Reinvested capital came back at only a modest incremental return — near the cost of capital, where extra growth adds little per dollar. The record shows whether it is a soft stretch or a thinning moat.
Worst year 2019 · −31.2% op. margin

What this means
Operations went underwater in 2019, understand why before trusting the good years.
Share count −0.6%/yr

What this means
The share count is shrinking, buybacks are quietly growing your slice of the business.

Does AI threaten the moat?

Elevated contestability

The product is software or information, the very thing capable AI now produces more cheaply, so the moat is more contestable than the record alone implies.

In its own filing Raised, but not as a competitor

The filing raises AI among its risks, but in other terms (security, regulation, energy or the like), not as a competitor to its product; it frames AI mainly as a capability.

AI has collapsed the cost of building a capable substitute for the very thing this business sells. When a credible alternative can be assembled for a fraction of the incumbent's price, it is pricing power that erodes first, not revenue tomorrow. The live question is whether the moat survives that, not whether it held in the past. Whether that question is answerable at all is yours to decide, against your own circle of competence.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of fiscal year-end, Dec 31, 2025

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$400M

Cash & short-term investments$305M
Receivables$68M
Inventory$403K
Other current assets$26M

Current liabilities$208M

Debt due within a year$4M
Accounts payable$42M
Other current liabilities$163M

Current ratio1.92×all current assets ÷ what's due · Graham looked for 2×

Quick ratio1.92×stricter: inventory excluded

Cash ratio1.46×strictest: cash alone against what's due

Working capital$191Mthe cushion left after near-term bills

Debt due this year vs. cash$4M due · $305M cash covered by cash on hand, no refinancing forced · both figures from the Dec 31, 2025 balance sheet

Deeper floors

Tangible book value$1.3Bequity stripped of goodwill & intangibles

Net current asset value$140MGraham's net-net: current assets less all liabilities

Debt incl. operating leases$42M$487K of it operating leases

Deferred revenue$43Mcustomer cash collected before delivery; operating float

From the company's latest filing.

How the cash was used, 2016–2025

Over the record, the business generated $67M of operating cash; how management split it reads as a reinvestor, most operating cash is plowed back into the business.

Reinvested$83M · 123%
Buybacks$712K · 1%

Returned to owners$712K
4% of the owner earnings the business produced over the span, $0 as dividends and $712K as buybacks.
Source of funding−$16M
Reinvestment and shareholder returns ran $16M beyond the operating cash the business generated, so the gap was financed off the balance sheet: cash and short-term investments drew down $76M.
Average price paid for buybacks—
Buybacks ran $712K over the span, but the filings don't tag the share count needed to deduce the average price paid.
Net change in share count−5.9%
The diluted count fell from 334M to 314M, so the buybacks outran the stock issued to staff.
Dividend record—
No dividend line was reported in the filing data over the span; the record here neither confirms nor rules out a payout.
Return on what it retained4%
Of the earnings it kept rather than paid out ($915M over the span), annual owner earnings (first three years vs last three) grew $40M, so each retained $1 added about 0.04 of yearly owner earnings. Buffett's test, run on owner earnings instead of market value.

Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.

Inverting the record

Invert: instead of why Xunlei Limited is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2016–2025.

2 of the 4 tests turned up something to look into; the other 2 came back clean.

Look hereDid reported profit become cash?0.07×
Across the record the business reported $916M of net income but generated $67M of operating cash, a 0.07-to-one conversion. Profit that does not turn into cash over many years is the classic mark of earnings that are softer than they look. Ask where the gap sits, receivables, inventory, or costs being capitalized rather than expensed.
Look hereDid receivables and inventory outpace sales?11% → 15% of sales
Receivables and inventory grew from $15M to $69M while revenue grew 228%: working capital is climbing faster than sales (11% of revenue then, 15% now). That can mean customers paying slower, stock building up, or revenue pulled forward. The filing's cash-flow and receivables notes say which.

And these came back clean

Is it less profitable than it was?
Did the share count rise anyway?

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

Peers, Software

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
INTAIntapp	$504M	67%	-9.8%	-23%	6%
PDPagerDuty	$493M	84%	-33.4%	-24%	3%
XNETXunlei Limited	$460M	46%	-7.5%	-8%	6%
SPTSprout Social Inc	$458M	76%	-20.6%	-52%	2%
XPERXperi Inc. Common Stock	$448M	—	-29.1%	-19%	-7%
ALKTAlkami Technology Inc.	$444M	54%	-28.2%	-15%	-19%
VIAVia Transportation Inc.	$434M	40%	-24.8%	-24%	-21%
AVPTAvePoint Inc.	$419M	72%	-10.2%	—	12%
Group median	—	67%	-22.7%	-23%	3%

The price

What a price has to assume.

What the price implies

reverse-DCF

Enter the US price, in dollars: the NYSE/Nasdaq quote you hold. Per the filing's own cover, “American depositary shares , each representing five common”; Xunlei Limited reports in USD, so every figure in this tool is stated per ADS so your dollar quote reconciles exactly. The record tables elsewhere on this page remain as filed.

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Xunlei Limited has delivered.

Today’s price $

Through the cycle, Xunlei Limited earns about $26M on its 5.7% median owner-earnings margin. This year’s 5.9% margin runs in line with that. Normalize, below, values the price on that through-cycle figure rather than the latest year.

Base Normalize · through-cycle ($26M) Net of stock comp

—

The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth · ’21→’25−4%/yr

Owner-earnings growth · since FY2021+44%/yr

Owner-earnings yield—

P/E (3-yr earnings ’23–’25)—

P/B—

Graham’s price gate—

Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Owner earnings $27M on 63M shares outstanding, per the 20-F cover, as of 2025-12-31; net cash $263M. The base is the latest year by default; Normalize values it on the through-cycle median owner-earnings margin (to avoid paying on a peak year). Net of stock comp treats option pay as the expense it is. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh XNET against another business →

Cite: Owner Scorecard, "Xunlei Limited (XNET), the owner's record," https://ownerscorecard.com/c/XNET, data as of 2026-07-09.

Manual order: ← XHG its page in the Manual XP →

Industry order: ← WRD the Software chapter XPER →