Hello Group Inc. Reports Third Quarter 2024 Financial Results
Hello Group Inc. (NASDAQ: MOMO), a prominent player in China's online social networking space, has released its unaudited financial results for the third quarter of 2024.
Key Financial Metrics
Table: Financial Performance Summary (Q3 2024)
| Metric | Q3 2024 | Q3 2023 | YoY Change |
|---|---|---|---|
| Total Revenue (RMB) | 2,674.7 million | 3,042.8 million | -12.1% |
| Net Income (RMB) | 449.4 million | 546.4 million | -17.8% |
| Non-GAAP Net Income (RMB) | 493.3 million | 605.9 million | -18.6% |
| Diluted Net Income per ADS (RMB) | 2.46 | 2.75 | -10.5% |
| Non-GAAP Diluted Net Income per ADS | 2.70 | 3.05 | -11.5% |
The third quarter of 2024 saw a decline in total revenues by 12.1% year-over-year and a corresponding decrease in net income. This decrease is attributed to strategic operational adjustments and a broader softening in consumer sentiment. However, despite the challenges, Hello Group has managed to maintain robust cost management, evidenced by a reduction in overall expenses.
Revenue Breakdown by Segment
Table: Revenue Performance by Segment (Q3 2024)
| Segment | Q3 2024 Revenue (RMB) | Q3 2023 Revenue (RMB) | YoY Change |
|---|---|---|---|
| Live Video Services | 1,286.4 million | 1,530.8 million | -16.0% |
| Value-added Services | 1,356.3 million | 1,466.7 million | -7.5% |
| Mobile Marketing | 30.7 million | 30.7 million | 0.0% |
| Momo Segment Total | 2,462.3 million | 2,743.1 million | -10.2% |
| Tantan Segment Total | 212.1 million | 295.0 million | -28.1% |
The revenue decline in key segments such as live video and value-added services highlights a pivot in operational priorities and challenges in the current economic environment. Notably, the Momo segment experienced a decline due to reduced emphasis on large-scale competition events, while the Tantan segment's revenue dip was influenced by a decreased user base and strategic adjustments.
Key Developments & Operational Highlights
- Operational Adjustments: Focused on improving ecosystem and product offering across Momo and Tantan apps.
- Overseas Expansion: Demonstrated reaccelerated growth through enhanced operational efficiency and localization efforts.
- Cost Management: Effective cost and expense management with a notable decrease in salary and share-based compensation expenses.
Management Commentary
Yan Tang, Chairman and CEO of Hello Group, remarked on the company's strategic advancements and satisfactory financial performance amid operational realignment. Emphasizing the progress in overseas markets, Tang expressed confidence in ongoing investments to foster diversified growth.
Share Repurchase Program
In March 2024, Hello Group extended and expanded its Share Repurchase Program, authorizing the repurchase of up to US$286.1 million worth of its shares through June 2026. As of December 9, 2024, a total of 40 million ADSs have been repurchased for US$238.4 million, averaging US$5.94 per ADS.
Forward Guidance
For Q4 2024, Hello Group anticipates net revenues between RMB2.56 billion and RMB2.66 billion, suggesting a year-over-year decrease ranging from 11.4% to 14.7%.
In summary, while Hello Group navigates through a challenging economic landscape with strategic pivots and operational adjustments, its focus on cost management and overseas growth provides a framework for future resilience.
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