(Yicai Global) Aug. 6 -- Kuaishou Technology’s share price plumbed new depths today as a six-month lock-up period for stocks in China’s second-largest short video platform operator expired yesterday and investors went on a selling spree.

Kuaishou’s share price [HKG:1024] closed down 4.71 percent at HKD84.90 (USD11). Earlier in the day it had fallen 11.8 percent to a record low of HKD78.60. Yesterday shares tumbled 15 percent.

Existing shareholders and the employee stock ownership program, accounting for 95 percent of equity, agreed to a six-month lock-up period after the livestreaming platform went public on the Hong Kong stock exchange in February.

Listed companies tend to drop around the time the trading ban is lifted, securities analyst Song Yuxiang told Yicai Global. The share price will recover if the short-video platform’s fundamentals, including its bottom line and user data, improve.

Kuaishou’s underwhelming performance this year is also behind the sinking stock, which is now trading at around 80 percent of its peak in February. The company has seen HKD1 trillion (USD128.6 billion) wiped off its market valuation in the last half year. The Beijing-based firm’s net deficit expanded in the first quarter by 89 percent to reach CNY57 billion (USD8.8 billion), even though revenue grew 36 percent to CNY17 billion (USD2.6 billion).

The number of subscribers dropped by about 15 million in the first quarter. This is expected to fall even further in the second quarter, US investment bank Morgan Stanley said last month, citing data from Quest Mobile. The New York-based bank also pushed back the date when it expects Kuaishou to break even to 2025 from next year as it feels the company is facing big challenges with a shrinking gross margin and increasing expenditure to acquire new users.

The firm has also encountered setbacks abroad. Earlier this week Kuaishou confirmed that it will shut down its Zynn app, which was intended to compete with ByteDance’s TikTok in the North American market. Zynn was barred from app stores by Google and Apple in June due to its users’ theft of content from other platforms.

The termination of the Zynn service is a normal part of business operations and will not affect the company’s other products in overseas markets, it said.

Editors: Liu Xiaojie, Kim Taylor