Shares of Lizhi (NASDAQ:LIZI) were up more than 20% in pre-market trading on Monday after the Chinese audio equipment maker said its products would be included in Mercedes Benz S-class cars. The LIZI stock surge follows a similar, deal-linked move late last year.
In December, the Guangzhou, China firm signed a deal with Xpeng (NYSE:XPEV) to have its service added to the company’s smart electric vehicles (EVs). This will allow customers to make use of its premium content and AI-enhanced recommendations in the EVs. That news fueled a more-than-75% rise in LIZI stock.
The Mercedes connection will be made via Huawei Mobile Services (HMS) for Car, building on a collaboration Lizhi also announced in December to provide users with rich content and in-car services utilizing Huawei’s AI engine.
Lizhi is a platform for audio content, with a particular focus on user-generated content (UGC). At its most basic level, UGC refers to any kind of content (videos, photos, GIFs, memes, blog posts, and audio, for example) that has been created and shared by users online, according to website Tint. This type of content is a growing marketing and social media force, particularly with Generation Z.
LIZI Stock Bolstered By Tie-Up With Car Royalty
A deal with its Chinese neighbor Xpeng is one thing. But Mercedes Benz is a name that sits among car making royalty. This could be a deal that LIZI stock can take to the bank. Providing customers of the German manufacturer with a high-quality listening and audio entertainment experience seems like a perfect fit for the S-class demographic.
In its initial letter to shareholders earlier this month, Lizhi founder and CEO Jinnan (Marco) Lai said the company “envisions a future where real-time audio-based social networking can be realized anytime anywhere — either through the mirrors in restrooms, in self-driving smart cars, or through smart headsets that people carry around.”
To that end, the company has embarked on a series of technology partnerships, including one with Horizon Robotics, an established chip maker for smart mobility in China, to collaborate on audio services for the Internet of Vehicles (IoV) market. Horizon is a manufacturer of artificial intelligence (AI) chips for smart mobility in China.
On the date of publication, Robert Lakin did not have (either directly or indirectly) any positions in the securities mentioned in this article.
InvestorPlace contributor Robert Lakin is a veteran financial writer and editor, following fintech, agtech and property tech startups.