(Yicai Global) Feb. 28 -- Baidu Inc.'s video streaming unit IQiyi Inc. plans an initial public offering of shares in the US to raise USD1.5 billion despite never having turned a profit since it was founded eight years ago.

Half of the IPO proceeds would go to expand and consolidate content inventory, the Beijing-based company said in its prospectus for listing on the Nasdaq Stock Market. Some 40 percent would be used to fund operations, while the remainder would go toward upgrading its tech capabilities.

IQiyi was China's first video site to adopt a subscription-based business model. Revenue at China's most-viewed video service comes mainly from members, online ads, content release, and other services such as live broadcast, gaming, and e-literature. It has yet to make a profit, though financial losses are common among video streaming providers.

Along with the release of the IPO prospectus, iQiyi also made public its financial and operational data. It had net losses of CNY2.5 billion (USD395 million) in 2015, CNY3 billion in 2016, and CNY3.7 billion last year. Its net loss ratio was 48 percent, 27 percent, and 22 percent in those years. The decrease indicates that the company has improved the efficiency of its capital usage.

In 2017, revenue was CNY17.3 billion, up nearly 55 percent from a year earlier. It more than doubled to CNY11.2 billion in 2016 from CNY5.3 billion in 2015. But despite steady revenue increases, its net loss last year was CNY3.7 billion, compared with CNY3.1 billion in 2016. The number of its daily active users was 53.7 million and it had an average of more than 420 million mobile users a month in 2017.

Baidu holds 69.6 percent stake in iQiyi, while Xiaomi Inc. holds 8.4 percent, HH RSV-V Holdings Ltd., affiliated to Hillhouse Capital, holds 5.7 percent, and iQiyi's founder and CEO Gong Yu holds 1.8 percent.

After the IPO, Baidu will own common B shares of the company exercising voting rights, and will remain as the controlling shareholder. Baidu founder Robin Li is also the board chairman of iQiyi, and Baidu COO Lu Qi and CFO Yu Zhengjun are both board members.

The IPO's underwriters are Goldman Sachs Asia, Credit Suisse, Bank of America Merrill Lynch, China Renaissance, Citibank and UBS.