Huya Inc. (HUYA), a leading game live streaming platform in China, saw its stock plummet by 5.06% in pre-market trading on Thursday. This significant drop comes despite the company's recent announcement of a substantial cash dividend and the setting of its ex-dividend date.

According to a press release, Huya Inc. has set July 1, 2025, as the ex-dividend date for its previously announced cash dividend of US$1.47 per ordinary share or American depositary share (ADS). The dividend is part of the company's 2025-2027 Dividend Plan, with the expected payment date set for June 30, 2025. The New York Stock Exchange (NYSE) will apply "due bill" procedures for trades entered into before July 1, 2025, and settled on or after the record date of June 17, 2025.

The stock's sharp decline, despite the generous dividend announcement, may seem counterintuitive. However, it could be attributed to several factors. Some investors might be selling their shares to capture the dividend before the ex-dividend date, causing downward pressure on the stock price. Additionally, the market might interpret the large dividend payout as a sign that the company lacks better investment opportunities for its cash reserves, potentially raising concerns about future growth prospects. It's also possible that other market factors or broader economic concerns are influencing the stock's performance beyond the dividend announcement.