Hello Group Inc. Announces Unaudited Financial Results for the Second Quarter of 2021

Rhea-AI Summary

Hello Group Inc. (NASDAQ: MOMO) reported its Q2 2021 financial results, revealing a 5.1% year-over-year decrease in net revenues to RMB3,671.7 million (US$568.7 million). Despite this decline, net income attributable to the Company rose to RMB464.2 million (US$71.9 million) from RMB456.4 million in Q2 2020. Non-GAAP net income fell to RMB551.0 million (US$85.3 million). Monthly active users reached 115.6 million, up from 111.5 million in June 2020. The Company forecasts Q3 revenues between RMB3.65 billion and RMB3.75 billion, indicating a potential decline of up to 3.1% year-over-year.

Positive

• Net income attributable to Hello Group Inc. increased to RMB464.2 million (US$71.9 million) in Q2 2021.
• Monthly Active Users (MAU) rose to 115.6 million in June 2021, compared to 111.5 million in June 2020.
• Value-added service revenues grew by 25.2% year-over-year to RMB1,507.3 million (US$233.4 million).
• Mobile marketing revenues increased by 35.9% to RMB51.6 million (US$8.0 million).

Negative

• Total net revenues decreased by 5.1% year-over-year to RMB3,671.7 million (US$568.7 million) in Q2 2021.
• Non-GAAP net income decreased to RMB551.0 million (US$85.3 million) from RMB669.8 million in the same period of 2020.
• Live video service revenues declined by 19.3% year-over-year to RMB2,101.3 million (US$325.5 million).
• Net cash used in operating activities was RMB167.8 million (US$26.0 million), down from RMB807.3 million in Q2 2020.

BEIJING, Aug. 26, 2021 /PRNewswire/ -- Hello Group Inc. (NASDAQ: MOMO) (the "Company"), a leading mobile social and entertainment platform in China, today announced its unaudited financial results for the second quarter of 2021.

Second Quarter of 2021 Highlights

• Net revenues decreased by 5.1% year over year to RMB3,671.7 million (US$568.7 million*) in the second quarter of 2021.
• Net income attributable to Hello Group Inc. increased to RMB464.2 million (US$71.9 million) in the second quarter of 2021 from RMB456.4 million in the same period of 2020.
• Non-GAAP net income attributable to Hello Group Inc. (note 1) decreased to RMB551.0 million (US$85.3 million) in the second quarter of 2021, from RMB669.8 million in the same period of 2020.
• Diluted net income per American Depositary Share ("ADS") was RMB2.15 (US$0.33) in the second quarter of 2021, compared to RMB2.11 in the same period of 2020.
• Non-GAAP diluted net income per ADS (note 1) was RMB2.54 (US$0.39) in the second quarter of 2021, compared to RMB3.05 in the same period of 2020.
• Monthly Active Users ("MAU") on the Company application were 115.6 million in June 2021, compared to 111.5 million in June 2020.
• Total paying users of our live video service and value-added service, without double counting the overlap and including 3.1 million paying users of Tantan Limited ("Tantan"), were 12.4 million for the second quarter of 2021, compared to 12.8 million for the second quarter of 2020, which included 3.9 million paying users of Tantan.

First Half of 2021 Highlights

• Net revenues decreased 4.3% year over year to RMB7,142.3 million (US$1,106.2 million) for the first half of 2021.
• Net income attributable to Hello Group Inc. was RMB925.8 million (US$143.4 million) for the first half of 2021, compared with RMB995.3 million during the same period of 2020.
• Non-GAAP net income attributable to Hello Group Inc. (note 1) was RMB1,184.6 million (US$183.5 million) for the first half of 2021, compared with RMB1,406.0 million during the same period of 2020.
• Diluted net income per ADS was RMB4.29 (US$0.66) for the first half of 2021, compared with RMB4.57 during the same period of 2020.
• Non-GAAP diluted net income per ADS (note 1) was RMB5.45 (US$0.84) for the first half of 2021, compared with RMB6.39 during the same period of 2020.

"The second quarter of 2021 was a solid quarter with decent financial results and progress on all of our strategic priorities." commented Li Wang, CEO of Hello Group. "The fundamentals of the core Momo as a social platform continued to strengthen. At the same time revenue performance and structure showed solid improvements. The healthy and productive core business gives us important leverage to plow new grounds and build longer term drivers for the group."

* This press release contains translations of certain Renminbi amounts into U.S. dollars at specified rates solely for the convenience of readers. Unless otherwise noted, all translations from Renminbi to U.S. dollars, in this press release, were made at a rate of RMB6.4566 to US$1.00, the effective noon buying rate for June 30, 2021 as set forth in the H.10 statistical release of the Federal Reserve Board.

Second Quarter of 2021 Financial Results

Net revenues

Total net revenues were RMB3,671.7 million (US$568.7 million) in the second quarter of 2021, a decrease of 5.1% from RMB3,868.3 million in the second quarter of 2020.

Live video service revenues were RMB2,101.3 million (US$325.5 million) in the second quarter of 2021, a decrease of 19.3% from RMB2,602.9 million during the same period of 2020. The decrease was primarily due to our structural reform on the Company's core live video business, which was used to revive the long tail content ecosystem. The decrease was partially offset by the growth from Tantan's live video service revenues, which were RMB216.5 million (US$33.5 million) in the second quarter of 2021, compared to RMB191.7 million in the same period of 2020.

Value-added service revenues mainly include virtual gift revenues and membership subscription revenues. Total value-added service revenues were RMB1,507.3 million (US$233.4 million) in the second quarter of 2021, an increase of 25.2% from RMB1,204.3 million during the same period of 2020. The year-over-year increase was primarily attributable to the continued growth of the virtual gift business on the Momo application driven by more innovative products and operational ideas launched, and more paying scenarios introduced to enhance the social entertainment experience of Momo users, and to a lesser extent, the increase in the virtual gift revenues of new applications. The increase was partially offset by the decrease in the membership subscription revenues of Tantan, due to the decrease of paying users of Tantan.

Mobile marketing revenues were RMB51.6 million (US$8.0 million) in the second quarter of 2021, an increase of 35.9% from RMB38.0 million during the same period of 2020. The increase in mobile marketing revenues was primarily caused by the increased demand from brand marketers.

Mobile games revenues were RMB9.2 million (US$1.4 million) in the second quarter of 2021, a decrease of 20.6% from RMB11.6 million in the second quarter of 2020. The decrease in mobile game revenues was mainly due to the continued decrease in quarterly paying users of mobile games.

Net revenues from the Momo segment decreased from RMB3,340.7 million in the second quarter of 2020 to RMB3,157.5 million (US$489.0 million) in the second quarter of 2021, primarily due to the decrease in net revenues from live video service, partially offset by the increase in net revenues from value-added service. Net revenues from the Tantan segment decreased from RMB517.2 million in the second quarter of 2020 to RMB513.5 million (US$79.5 million) in the second quarter of 2021, which was mainly due to the decrease in the membership subscription revenues. 

Cost and expenses

Cost and expenses were RMB3,075.6 million (US$476.4 million) in the second quarter of 2021, a decrease of 2.3% from RMB3,146.9 million in the second quarter of 2020. The decrease was primarily attributable to: (a) a decrease in share-based compensation expenses due to the fair value remeasurement of liability classified options granted to Tantan's founders; (b) a decrease in infrastructure-related spending, such as server depreciation costs; (c) a decrease in commission fees paid to payment channels. These decreases were partially offset by an increase in revenue sharing with virtual gift recipients for our virtual gift service, an increase in revenue sharing with broadcasters related to Tantan's live video service, and an increase in marketing and promotional expenses to promote our core live video services.

Non-GAAP cost and expenses (note 1) were RMB2,980.1 million (US$461.6 million) in the second quarter of 2021, an increase of 1.9% from RMB2,923.7 million during the same period of 2020.

Other operating income

Other operating income was RMB90.3 million (US$14.0 million) in the second quarter of 2021, a decrease from RMB91.3 million during the second quarter of 2020. The other operating income mainly consisted of government incentives.

Income from operations

Income from operations was RMB686.3 million (US$106.3 million) in the second quarter of 2021, compared to RMB812.7 million during the same period of 2020. Income from operations of the Momo segment was RMB711.3 million (US$110.2 million) in the second quarter of 2021, which decreased from RMB945.3 million in the second quarter of 2020. Loss from operations of the Tantan segment was RMB11.9 million (US$1.8 million) in the second quarter of 2021, compared to loss from operations of RMB125.6 million in the second quarter of 2020.

Non-GAAP income from operations (note 1) was RMB781.9 million (US$121.1 million) in the second quarter of 2021, compared to RMB1,035.8 million during the same period of 2020. Non-GAAP income from operations of the Momo segment was RMB835.8 million (US$129.5 million) in the second quarter of 2021, which decreased from RMB1,102.6 million in the second quarter of 2020. Non-GAAP loss from operations of the Tantan segment was RMB40.9 million (US$6.3 million) in the second quarter of 2021, compared to non-GAAP loss from operations of RMB62.4 million in the second quarter of 2020.

Income tax expenses

Income tax expenses were RMB291.5 million (US$45.1 million) in the second quarter of 2021, decreasing from RMB443.6 million in the second quarter of 2020. The decrease in income tax expenses was mainly due to (a) the lower profit in the second quarter of 2021; and (b) less payment of withholding income tax on dividends distributed by our wholly-foreign owned enterprise ("WFOE") in China to our offshore entity in the second quarter of 2021. The dividends of RMB1,300.0 million (US$201.3 million) and withholding income tax of RMB130.0 million (US$20.1 million) were paid in the second quarter of 2021.

Net income

Net income was RMB461.5 million (US$71.5 million) in the second quarter of 2021, compared to RMB455.5 million during the same period of 2020. Net income from the Momo segment was RMB481.3 million (US$74.5 million) in the second quarter of 2021, which decreased from RMB586.7 million in the second quarter of 2020. Net loss from the Tantan segment was RMB6.7 million (US$1.0 million) in the second quarter of 2021, compared to net loss of RMB124.3 million in the second quarter of 2020.

Non-GAAP net income (note 1) was RMB548.3 million (US$84.9 million) in the second quarter of 2021, compared to RMB668.9 million during the same period of 2020. Non-GAAP net income from the Momo segment was RMB605.8 million (US$93.8 million) in the second quarter of 2021, which decreased from RMB744.0 million in the second quarter of 2020. Non-GAAP net loss of the Tantan segment was RMB44.5 million (US$6.9 million) in the second quarter of 2021, compared to non-GAAP net loss of RMB70.8 million in the second quarter of 2020.

Net income attributable to Hello Group Inc.

Net income attributable to Hello Group Inc. was RMB464.2 million (US$71.9 million) in the second quarter of 2021, compared to RMB456.4 million during the same period of 2020.

Non-GAAP net income (note 1) attributable to Hello Group Inc. was RMB551.0 million (US$85.3 million) in the second quarter of 2021, compared to RMB669.8 million during the same period of 2020.

Net income per ADS

Diluted net income per ADS was RMB2.15 (US$0.33) in the second quarter of 2021, compared to RMB2.11 in the second quarter of 2020.

Non-GAAP diluted net income per ADS (note 1) was RMB2.54 (US$0.39) in the second quarter of 2021, compared to RMB3.05 in the second quarter of 2020.

Cash and cash flow

As of June 30, 2021, the Company's cash, cash equivalents, short-term deposits, long-term deposits, short-term restricted cash and long-term restricted cash totaled RMB15,450.0 million (US$2,392.9 million), compared to RMB16,482.3 million as of December 31, 2020. Net cash used in operating activities in the second quarter of 2021 was RMB167.8 million (US$26.0 million), compared to a net cash provided by operating activities of RMB807.3 million in the second quarter of 2020. The decrease in net cash provided by operating activities was mainly due to the cash payment of RMB678.2 million (US$105.0 million) we made to Tantan's founders to settle the previously granted liability-classified share options upon their termination of services with Tantan in the second quarter of 2021.

First Half of 2021 Financial Results

Net revenues for the first half of 2021 were RMB7,142.3 million (US$1,106.2 million), a decrease of 4.3% from RMB7,462.3 million in the same period of 2020.

Net income attributable to Hello Group Inc. was RMB925.8 million (US$143.4 million) for the first half of 2021, compared to RMB995.3 million during the same period of 2020.

Non-GAAP net income attributable to Hello Group Inc. (note 1) was RMB1,184.6 million (US$183.5 million) for the first half of 2021, compared to RMB1,406.0 million during the same period of 2020.

Diluted net income per ADS was RMB4.29 (US$0.66) during the first half of 2021, compared to RMB4.57 in the same period of 2020.

Non-GAAP diluted net income per ADS (note 1) was RMB5.45 (US$0.84) during the first half of 2021, compared to RMB6.39 in the same period of 2020.

Net cash provided by operating activities was RMB333.8 million (US$51.7 million) during the first half of 2021, compared to RMB1,350.7 million in the same period of 2020.

Recent Developments

Execution of share repurchase program

On September 3, 2020, the Company's board of directors authorized a share repurchase program under which the Company may repurchase up to US$300 million of its shares over the next 12 months. As of August 26, 2021, the Company has repurchased 13.46 million ADSs for US$173.4 million on the open market under this program, at an average purchase price of US$12.87 per ADS.

Business Outlook

For the third quarter of 2021, the Company expects total net revenues to be between RMB3.65 billion to RMB3.75 billion, representing a decrease of 3.1% to 0.4% year-over-year. This forecast reflects the Company's current and preliminary views on the market and operational conditions, which are subject to change.

Note 1: Non-GAAP measures

To supplement our consolidated financial statements presented in accordance with U.S. generally accepted accounting principles ("GAAP"), we use various non-GAAP financial measures that are adjusted from the most comparable GAAP results to exclude share-based compensation and amortization of intangible assets from business acquisitions, and tax impacts related to the amortization of intangible assets from business acquisitions.

Reconciliations of our non-GAAP financial measures to our U.S. GAAP financial measures are shown in tables at the end of this earnings release, which provide more details about the non-GAAP financial measures.

Our non-GAAP financial information is provided as additional information to help investors compare business trends among different reporting periods on a consistent basis and to enhance investors' overall understanding of the historical and current financial performance of our continuing operations and our prospects for the future. Our non-GAAP financial information should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to the GAAP results. In addition, our calculation of the non-GAAP financial measures may be different from the calculation used by other companies, and therefore comparability may be limited.

Our non-GAAP information (including non-GAAP cost and operating expenses, income (loss) from operations, net income (loss)，net income attributable to Hello Group Inc., and diluted net income per ADS) is adjusted from the most comparable GAAP results to exclude share-based compensation, amortization of intangible assets from business acquisitions, and tax impacts related to the amortization of intangible assets from business acquisitions. A limitation of using these non-GAAP financial measures is that share-based compensation, amortization of intangible assets from business acquisitions and tax impacts related to the amortization of intangible assets from business acquisitions have been and will continue to be for the foreseeable future a significant recurring expense in our results of operations. We compensate for these limitations by providing reconciliations of our non-GAAP measures to our U.S. GAAP measures. Please see the reconciliation tables at the end of this earnings release.

Conference Call

Hello Group's management will host an earnings conference call on Thursday, August 26, 2021, at 8:00 a.m. U.S. Eastern Time (8:00 p.m. Beijing / Hong Kong Time on August 26, 2021).

All participants must preregister online prior to the call to receive the dial-in details. Once preregistration has been complete, participants will receive dial-in numbers, direct event passcode, and a unique registrant ID.

PRE-REGISTER LINK http://apac.directeventreg.com/registration/event/5771017

To join the conference, simply dial the number in the calendar invite you receive after preregistering, enter the passcode followed by your registrant ID, and you will join the conference instantly.

A telephone replay of the call will be available after the conclusion of the conference call through 9:00 a.m. U.S. Eastern Time, September 3, 2021. The dial-in details for the replay are as follows:

International:   +61-2-8199-0299
U.S. Toll Free: +1-855-452-5696
Passcode: 5771017

Additionally, a live and archived webcast of the conference call will be available on the Investor Relations section of the Company's website at http://ir.immomo.com.

About Hello Group Inc.

We are a leading player in China's online social and entertainment space. Through Momo, Tantan and other properties within our product portfolio, we enable users to discover new relationships, expand their social connections and build meaningful interactions. Momo is a mobile application that connects people and facilitates social interactions based on location, interests and a variety of online recreational activities. Tantan, which was added into our family of applications through acquisition in May 2018, is a leading social and dating application. It is designed to help its users find and establish romantic connections as well as meet interesting people. We also operate a number of other applications to serve different social and entertainment demands from our users.

For investor and media inquiries, please contact:

Hello Group Inc.

Investor Relations
Phone: +86-10-5731-0538
Email: ir@immomo.com   

Christensen

In China
Mr. Eric Yuan
Phone: +86-10-5900-1548
E-mail: Eyuan@christensenir.com  

In US
Ms. Linda Bergkamp
Phone: +1-480-614-3004
Email: lbergkamp@christensenir.com

Safe Harbor Statement

This news release contains "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements include but are not limited to our management quotes, our financial outlook for the third quarter of 2021, as well as the amount of, timing, methods and funding sources for repurchases of our shares under the share repurchase program.

Our forward-looking statements are not historical facts but instead represent only our belief regarding expected results and events, many of which, by their nature, are inherently uncertain and outside of our control. Our actual results and other circumstances may differ, possibly materially, from the anticipated results and events indicated in these forward-looking statements. Announced results for the second quarter of 2021 are preliminary, unaudited and subject to audit adjustment. In addition, we may not meet our financial outlook for the third quarter of 2021 and may be unable to grow our business in the manner planned. We may also modify our strategy for growth.  Moreover, there are other risks and uncertainties that could cause our actual results to differ from what we currently anticipate, including those relating to our ability to retain and grow our user base, our ability to attract and retain sufficiently trained professionals to support our operations, our ability to anticipate and develop new services and enhance existing services to meet the demand of our users or customers, the impact of the COVID-19 pandemic on the Company's business operations and the economy in China, the market price of the Company's stock prevailing from time to time, the nature of other investment opportunities presented to the Company from time to time, the Company's cash flows from operations, general economic conditions, and other factors.  For additional information on these and other important factors that could adversely affect our business, financial condition, results of operations, and prospects, please see our filings with the U.S. Securities and Exchange Commission.          

All information provided in this press release and in the attachments is as of the date of the press release. We undertake no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise, after the date of this release, except as required by law. Such information speaks only as of the date of this release.

 

 

Hello Group Inc.
Unaudited Condensed Consolidated Statement of Operations
(All amounts in thousands, except share and per share data)
	Three months						First half year
	Ended June 30						Ended June 30
	2020		2021		2021		2020		2021		2021
	RMB		RMB		US$		RMB		RMB		US$
Net revenues:
Live video service	2,602,876		2,101,332		325,455		4,934,880		4,063,427		629,345
Value-added service	1,204,320		1,507,258		233,445		2,380,074		2,962,771		458,875
Mobile marketing	37,964		51,601		7,992		95,119		90,318		13,988
Mobile games	11,564		9,182		1,422		24,255		20,366		3,154
Other services	11,528		2,341		362		28,008		5,428		841
Total net revenues	3,868,252		3,671,714		568,676		7,462,336		7,142,310		1,106,203
Cost and expenses:
Cost of revenues	(2,036,305)		(2,070,329)		(320,653)		(3,913,221)		(4,008,574)		(620,849)
Research and development	(279,002)		(268,325)		(41,558)		(541,161)		(554,818)		(85,930)
Sales and marketing	(651,500)		(650,236)		(100,709)		(1,361,308)		(1,263,809)		(195,739)
General and administrative	(180,061)		(86,747)		(13,435)		(357,310)		(264,709)		(40,998)
Total cost and expenses	(3,146,868)		(3,075,637)		(476,355)		(6,173,000)		(6,091,910)		(943,516)
Other operating income	91,329		90,268		13,981		117,448		116,168		17,992
Income from operations	812,713		686,345		106,302		1,406,784		1,166,568		180,679
Interest income	108,536		94,448		14,628		239,359		191,142		29,604
Interest expense	(20,121)		(18,302)		(2,835)		(39,940)		(36,663)		(5,678)
Other gain or loss, net	-		(10,500)		(1,626)		(6,000)		(18,000)		(2,788)
Income before income tax    and share of income on    equity method    investments	901,128		751,991		116,469		1,600,203		1,303,047		201,817
Income tax expenses	(443,633)		(291,509)		(45,149)		(606,524)		(382,907)		(59,305)
Income before share of    income on equity method    investments	457,495		460,482		71,320		993,679		920,140		142,512
Share of (loss) income on    equity method investments	(1,967)		1,042		161		(440)		2,303		357
Net income	455,528		461,524		71,481		993,239		922,443		142,869
Less: net loss attributable to non-controlling interest	(872)		(2,636)		(408)		(2,067)		(3,376)		(523)
Net income attributable to    the shareholders of Hello    Group Inc.	456,400		464,160		71,889		995,306		925,819		143,392
Net income per share    attributable to ordinary    shareholders
Basic	1.09		1.13		0.17		2.38		2.25		0.35
Diluted	1.05		1.07		0.17		2.29		2.15		0.33
Weighted average shares    used in calculating net    income per ordinary share
Basic	417,559,984		411,540,714		411,540,714		417,427,113		411,753,583		411,753,583
Diluted	452,500,168		449,020,572		449,020,572		452,915,745		448,597,242		448,597,242

 

 

Hello Group Inc.
Unaudited Condensed Consolidated Statement of Comprehensive Income
(All amounts in thousands, except share and per share data)
	Three months						First half year
	Ended June 30						Ended June 30
	2020		2021		2021		2020		2021		2021
	RMB		RMB		US$		RMB		RMB		US$
Net income	455,528		461,524		71,481		993,239		922,443		142,869
Other comprehensive income    (loss), net of tax:
Foreign currency translation    adjustment	8,818		(28,396)		(4,398)		7,951		(32,198)		(4,987)
Comprehensive income	464,346		433,128		67,083		1,001,190		890,245		137,882
Less: comprehensive loss    attributed to the non-controlling    interest	(1,423)		(6,162)		(954)		(6,992)		(5,783)		(896)
Comprehensive income    attributable to Hello Group    Inc.	465,769		439,290		68,037		1,008,182		896,028		138,778

 

 

Hello Group Inc.
Unaudited Condensed Consolidated Balance Sheets
(All amounts in thousands, except share and per share data)
	December 31		June 30		June 30
	2020		2021		2021
	RMB		RMB		US$
Assets
Current assets
Cash and cash equivalents	3,363,942		2,204,455		341,427
Short-term deposits	7,566,250		7,365,886		1,140,830
Restricted cash	2,130		2,133		330
Accounts receivable, net of allowance for doubtful accounts of    RMB15,390 and RMB15,954 as of December 31, 2020 and June 30, 2021, respectively	200,831		217,063		33,619
Prepaid expenses and other current assets	613,696		733,792		113,650
Total current assets	11,746,849		10,523,329		1,629,856
Long-term deposits	5,550,000		5,800,000		898,306
Long-term restricted cash	-		77,479		12,000
Right-of-use assets, net	278,175		223,901		34,678
Property and equipment, net	265,765		224,964		34,842
Intangible assets, net	687,211		607,411		94,076
Rental deposits	21,794		22,386		3,467
Long-term investments	454,996		733,689		113,634
Other non-current assets	94,868		100,054		15,496
Deferred tax assets	32,495		33,729		5,224
Goodwill	4,088,403		4,045,777		626,611
Total assets	23,220,556		22,392,719		3,468,190
Liabilities and equity
Current liabilities
Accounts payable	699,394		752,474		116,545
Deferred revenue	511,617		517,921		80,216
Accrued expenses and other current liabilities	854,835		752,881		116,606
Amount due to related parties	19,462		12,906		1,999
Lease liabilities due within one year	132,793		129,044		19,986
Income tax payable	236,490		140,111		21,700
Deferred consideration in connection with business acquisitions	62,149		45,443		7,038
Total current liabilities	2,516,740		2,350,780		364,090
Deferred tax liabilities	171,803		151,853		23,519
Convertible senior notes	4,658,966		4,617,465		715,154
Share-based compensation liability	875,616		-		-
Lease liabilities	136,436		99,858		15,466
Other non-current liabilities	25,666		135,050		20,916
Total liabilities	8,385,227		7,355,006		1,139,145
Shareholder's equity (i)	14,835,329		15,037,713		2,329,045
Total liabilities and shareholder's equity	23,220,556		22,392,719		3,468,190
(i): As of June 30, 2021, the number of ordinary shares outstanding was 411,632,190.

 

 

Hello Group Inc.
Unaudited Condensed Consolidated Statement of Cash Flows
(All amounts in thousands, except share and per share data)
	Three months						First half year
	Ended June 30						Ended June 30
	2020		2021		2021		2020		2021		2021
	RMB		RMB		US$		RMB		RMB		US$
Cash flows from operating activities:
Net income	455,528		461,524		71,481		993,239		922,443		142,869
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation of property and equipment	52,210		40,072		6,206		104,591		82,615		12,795
Amortization of intangible assets	40,288		36,108		5,592		80,170		73,061		11,316
Share-based compensation	184,100		60,658		9,395		352,627		205,915		31,891
Share of loss (income) on equity method investments	1,967		(1,042)		(161)		440		(2,303)		(357)
Loss on long-term investments	-		10,500		1,626		6,000		18,000		2,788
Gain on subsidiary deconsolidation	-		-		-		(6,676)		-		-
Gain on disposal of subsidiaries	-		(15,526)		(2,405)		-		(15,526)		(2,405)
Loss on disposal of property and equipment	(1)		(1,101)		(171)		(1)		(1,079)		(167)
Provision of  losses on receivable and other assets	1,060		169		26		406		564		87
Cash received on investment income distribution	-		-		-		1,153		-		-
Changes in operating assets and liabilities:
Accounts receivable	39,725		(15,162)		(2,348)		1,746		(22,742)		(3,522)
Prepaid expenses and other current assets	42,671		(31,941)		(4,947)		43,833		(118,618)		(18,372)
Amount due from a related party	230		-		-		2,353		-		-
Rental deposits	363		(1,951)		(302)		190		(592)		(92)
Deferred tax assets	435		(627)		(97)		2,473		(1,234)		(191)
Other non-current assets	3,411		36,720		5,687		18,251		49,050		7,597
Accounts payable	63,598		48,889		7,572		(16,475)		47,822		7,407
Income tax payable	44,712		(119,269)		(18,472)		65,056		(96,378)		(14,927)
Deferred revenue	(12,249)		16,464		2,550		(33,272)		16,085		2,491
Accrued expenses and other current liabilities	(59,987)		23,189		3,592		(214,230)		(95,783)		(14,835)
Amount due to related parties	(16,217)		600		93		(11,233)		(6,556)		(1,015)
Deferred tax liability	(10,072)		(9,027)		(1,398)		(20,043)		(18,265)		(2,829)
Share-based compensation liability	-		(678,153)		(105,033)		-		(678,153)		(105,033)
Other non-current liabilities	(24,522)		(28,877)		(4,472)		(19,852)		(24,517)		(3,797)
Net cash provided by (used in) operating activities	807,250		(167,783)		(25,986)		1,350,746		333,809		51,699
Cash flows from investing activities:
Purchase of property and equipment	(45,803)		(20,020)		(3,101)		(83,970)		(45,203)		(7,001)
Payment for long-term investments	-		(300,000)		(46,464)		(4,500)		(300,000)		(46,464)
Purchase of short-term deposits	(4,941,858)		(1,566,688)		(242,649)		(8,241,858)		(2,476,688)		(383,590)
Cash received on maturity of short-term deposits	8,306,434		2,089,618		323,641		11,285,574		2,658,912		411,813
Payment for short-term investments	-		-		-		(10,000)		-		-
Cash received from sales of short-term investment	-		-		-		10,000		-		-
Cash received on investment income distribution	-		-		-		-		5,610		869
Cash of disposed subsidiaries	-		(8,750)		(1,355)		-		(8,750)		(1,355)
Purchase of long-term deposits	(2,800,000)		(250,000)		(38,720)		(2,800,000)		(250,000)		(38,720)
Other investing activities	15		2,390		370		(776)		2,393		371
Net cash provided by (used in) investing activities	518,788		(53,450)		(8,278)		154,470		(413,726)		(64,077)
Cash flows from financing activities:
Deferred payment for business acquisition	(18,355)		-		-		(18,355)		(12,907)		(1,999)
Proceeds from exercise of share options	1		310		48		1		310		48
Repurchase of ordinary shares	-		(103,072)		(15,964)		-		(106,151)		(16,441)
Repurchase of subsidiary's share options	-		(2,780)		(431)		-		(5,561)		(861)
Dividends payment	(1,123,983)		(852,743)		(132,073)		(1,123,983)		(852,743)		(132,073)
Net cash used in financing activities	(1,142,337)		(958,285)		(148,420)		(1,142,337)		(977,052)		(151,326)
Effect of exchange rate changes	(5,332)		(28,952)		(4,484)		1,961		(25,036)		(3,877)
Net increase (decrease) in cash and cash equivalents	178,369		(1,208,470)		(187,168)		364,840		(1,082,005)		(167,581)
Cash, cash equivalents and restricted cash at the beginning    of period	2,799,214		3,492,537		540,925		2,612,743		3,366,072		521,338
Cash, cash equivalents and restricted cash at the end of    period	2,977,583		2,284,067		353,757		2,977,583		2,284,067		353,757

 

 

	Hello Group Inc.
	Reconciliation of Non-GAAP financial measures to comparable GAAP measures
	(All amounts in thousands, except per share data)
1.		Reconciliation of Non-GAAP cost and operating expenses, income from operations, and net income to comparable GAAP measures.
		Three months						Three months						Three months
		Ended June 30, 2020						Ended June 30, 2021						Ended June 30, 2021
		GAAP	Amortization of intangible assets from business acquisitions	Share- based compensation	Tax impacts	Non- GAAP		GAAP	Amortization of intangible assets from business acquisitions	Share- based compensation	Tax impacts	Non-GAAP		GAAP	Amortization of intangible assets from business acquisitions	Share- based compensation	Tax impacts	Non-GAAP
					(ii)						(ii)						(ii)
		RMB	RMB	RMB	RMB	RMB		RMB	RMB	RMB	RMB	RMB		US$	US$	US$	US$	US$
Cost of revenues		(2,036,305)	18,929	2,804	-	(2,014,572)		(2,070,329)	17,256	4,201	-	(2,048,872)		(320,653)	2,673	651	-	(317,329)
Research and    development		(279,002)	2,404	49,985	-	(226,613)		(268,325)	1,461	33,965	-	(232,899)		(41,558)	226	5,261	-	(36,071)
Sales and marketing		(651,500)	17,702	43,123	-	(590,675)		(650,236)	16,137	14,588	-	(619,511)		(100,709)	2,499	2,259	-	(95,951)
General and    administrative		(180,061)	-	88,188	-	(91,873)		(86,747)	-	7,904	-	(78,843)		(13,435)	-	1,224	-	(12,211)
Cost and operating    expenses		(3,146,868)	39,035	184,100	-	(2,923,733)		(3,075,637)	34,854	60,658	-	(2,980,125)		(476,355)	5,398	9,395	-	(461,562)
Income from operations		812,713	39,035	184,100	-	1,035,848		686,345	34,854	60,658	-	781,857		106,302	5,398	9,395	-	121,095
Net income attributable to    Hello Group Inc.		456,400	39,035	184,100	(9,759)	669,776		464,160	34,854	60,658	(8,714)	550,958		71,889	5,398	9,395	(1,351)	85,331

 

 

Hello Group Inc.
Reconciliation of Non-GAAP financial measures to comparable GAAP measures
(All amounts in thousands, except per share data)
1		Reconciliation of Non-GAAP cost and operating expenses, income from operations, and net income to comparable GAAP measures-continued.
		First half year						First half year						First half year
		Ended June 30, 2020						Ended June 30, 2021						Ended June 30, 2021
		GAAP	Amortization of intangible assets from business acquisitions	Share- based compensation	Tax impacts	Non-GAAP		GAAP	Amortization of intangible assets from business acquisitions	Share- based compensation	Tax impacts	Non-GAAP		GAAP	Amortization of intangible assets from business acquisitions	Share- based compensation	Tax impacts	Non-GAAP
					(ii)						(ii)						(ii)
		RMB	RMB	RMB	RMB	RMB		RMB	RMB	RMB	RMB	RMB		US$	US$	US$	US$	US$
Cost of revenues		(3,913,221)	37,574	9,773	-	(3,865,874)		(4,008,574)	34,567	7,925	-	(3,966,082)		(620,849)	5,354	1,227	-	(614,268)
Research and    development		(541,161)	4,772	92,745	-	(443,644)		(554,818)	3,660	74,174	-	(476,984)		(85,930)	567	11,488	-	(73,875)
Sales and marketing		(1,361,308)	35,138	90,197	-	(1,235,973)		(1,263,809)	32,326	32,144	-	(1,199,339)		(195,739)	5,007	4,978	-	(185,754)
General and    administrative		(357,310)	-	159,912	-	(197,398)		(264,709)	-	91,672	-	(173,037)		(40,998)	-	14,198	-	(26,800)
Cost and operating    expenses		(6,173,000)	77,484	352,627	-	(5,742,889)		(6,091,910)	70,553	205,915	-	(5,815,442)		(943,516)	10,928	31,891	-	(900,697)
Income from    operations		1,406,784	77,484	352,627	-	1,836,895		1,166,568	70,553	205,915	-	1,443,036		180,679	10,928	31,891	-	223,498
Net income attributable    to Hello Group Inc.		995,306	77,484	352,627	(19,371)	1,406,046		925,819	70,553	205,915	(17,639)	1,184,648		143,392	10,928	31,891	(2,732)	183,479
(ii) Includes tax impacts related to the amortization of intangible assets from business acquisition.

 

 

Hello Group Inc.
Unaudited Condensed Segment Report
(All amounts in thousands, except share and per share data)
	Three months
	Ended June 30, 2021
	Momo		Tantan		QOOL		Total		Total
	RMB		RMB		RMB		RMB		US$
Net revenues:
Live video service	1,884,821		216,511		-		2,101,332		325,455
Value-added service	1,210,220		297,038		-		1,507,258		233,445
Mobile marketing	51,601		-		-		51,601		7,992
Mobile games	9,182		-		-		9,182		1,422
Other services	1,706		-		635		2,341		362
Total net revenues	3,157,530		513,549		635		3,671,714		568,676
Cost and expenses (iii):
Cost of revenues	(1,796,504)		(266,197)		(7,628)		(2,070,329)		(320,653)
Research and development	(195,371)		(72,954)		-		(268,325)		(41,558)
Sales and marketing	(378,938)		(270,266)		(1,032)		(650,236)		(100,709)
General and administrative	(140,905)		59,205		(5,047)		(86,747)		(13,435)
Total cost and expenses	(2,511,718)		(550,212)		(13,707)		(3,075,637)		(476,355)
Other operating income	65,445		24,798		25		90,268		13,981
Income (loss) from operations	711,257		(11,865)		(13,047)		686,345		106,302
Interest income	94,112		291		45		94,448		14,628
Interest expense	(18,302)		-		-		(18,302)		(2,835)
Other gain or loss, net	(10,500)		-		-		(10,500)		(1,626)
Income (loss) before income tax and    share of income on equity method    investments	776,567		(11,574)		(13,002)		751,991		116,469
Income tax (expenses) benefits	(296,344)		4,835		-		(291,509)		(45,149)
Income (loss) before share of income    on equity method investments	480,223		(6,739)		(13,002)		460,482		71,320
Share of income on equity method investments	1,042		-		-		1,042		161
Net income (loss)	481,265		(6,739)		(13,002)		461,524		71,481
(iii) Share-based compensation was allocated in cost of revenues and operating expenses as follows:
	Three months
	Ended June 30, 2021
	Momo		Tantan		QOOL		Total		Total
	RMB		RMB		RMB		RMB		US$
Cost of revenues	2,640		1,561		-		4,201		651
Research and development	29,663		4,302		-		33,965		5,261
Sales and marketing	12,971		1,617		-		14,588		2,259
General and administrative	79,308		(71,404)		-		7,904		1,224
Total cost and expenses	124,582		(63,924)		-		60,658		9,395

 

 

Hello Group Inc.
Reconciliation of GAAP and NON-GAAP Results of Unaudited Segment Report
(All amounts in thousands, except share and per share data)
	Three months
	Ended June 30, 2021
	Momo		Tantan		QOOL		Total		Total
	RMB		RMB		RMB		RMB		US$
Income (loss) from operations	711,257		(11,865)		(13,047)		686,345		106,302
Share-based compensation	124,582		(63,924)		-		60,658		9,395
Amortization of intangible assets from business    acquisitions	-		34,854		-		34,854		5,398
Non-GAAP income (loss) from operations	835,839		(40,935)		(13,047)		781,857		121,095
Net income (loss)	481,265		(6,739)		(13,002)		461,524		71,481
Share-based compensation	124,582		(63,924)		-		60,658		9,395
Amortization of intangible assets from business    acquisitions	-		34,854		-		34,854		5,398
Tax impacts	-		(8,714)		-		(8,714)		(1,351)
Non-GAAP net income (loss)	605,847		(44,523)		(13,002)		548,322		84,923

 

 

Hello Group Inc.
Unaudited Condensed Segment Report
(All amounts in thousands, except share and per share data)
	Three months
	Ended June 30, 2020
	Momo		Tantan		QOOL		Total		Total
	RMB		RMB		RMB		RMB		US$[1]
Net revenues:
Live video service	2,411,223		191,653		-		2,602,876		368,413
Value-added service	878,804		325,516		-		1,204,320		170,460
Mobile marketing	37,964		-		-		37,964		5,373
Mobile games	11,564		-		-		11,564		1,637
Other services	1,163		-		10,365		11,528		1,633
Total net revenues	3,340,718		517,169		10,365		3,868,252		547,516
Cost and expenses (iv):
Cost of revenues	(1,792,442)		(232,445)		(11,418)		(2,036,305)		(288,220)
Research and development	(202,774)		(76,228)		-		(279,002)		(39,490)
Sales and marketing	(337,196)		(314,293)		(11)		(651,500)		(92,214)
General and administrative	(154,161)		(19,828)		(6,072)		(180,061)		(25,486)
Total cost and expenses	(2,486,573)		(642,794)		(17,501)		(3,146,868)		(445,410)
Other operating income	91,190		-		139		91,329		12,927
Income (loss) from operations	945,335		(125,625)		(6,997)		812,713		115,033
Interest income	107,776		689		71		108,536		15,362
Interest expense	(20,121)		-		-		(20,121)		(2,848)
Income (loss) before income tax and    share of income on equity method    investments	1,032,990		(124,936)		(6,926)		901,128		127,547
Income tax (expenses) benefits	(444,278)		645		-		(443,633)		(62,792)
Income (loss) before share of income    on equity method investments	588,712		(124,291)		(6,926)		457,495		64,755
Share of loss on equity method    investments	(1,967)		-		-		(1,967)		(278)
Net income (loss)	586,745		(124,291)		(6,926)		455,528		64,477
(iv)            Share-based compensation was allocated in cost of revenues and operating expenses as follows:
	Three months
	Ended June 30, 2020
	Momo		Tantan		QOOL		Total		Total
	RMB		RMB		RMB		RMB		US$
Cost of revenues	3,396		(592)		-		2,804		397
Research and development	36,670		13,315		-		49,985		7,075
Sales and marketing	38,905		4,218		-		43,123		6,104
General and administrative	78,250		7,280		2,658		88,188		12,482
Total cost and expenses	157,221		24,221		2,658		184,100		26,058
[1] All translations from RMB to U.S. dollars are made at a rate of RMB7.0651 to US$1.00, the effective noon buying rate for June 30, 2020 a s set forth in the H.10 statistical release of the Federal Reserve Board.

 

Hello Group Inc.
Reconciliation of GAAP and NON-GAAP Results of Unaudited Segment Report
(All amounts in thousands, except share and per share data)
	Three months
	Ended June 30, 2020
	Momo		Tantan		QOOL		Total		Total
	RMB		RMB		RMB		RMB		US$
Income (loss) from operations	945,335		(125,625)		(6,997)		812,713		115,033
Share-based compensation	157,221		24,221		2,658		184,100		26,058
Amortization of intangible assets from business acquisitions	-		39,035		-		39,035		5,525
Non-GAAP income (loss) from operations	1,102,556		(62,369)		(4,339)		1,035,848		146,616
Net income (loss)	586,745		(124,291)		(6,926)		455,528		64,477
Share-based compensation	157,221		24,221		2,658		184,100		26,058
Amortization of intangible assets from business acquisitions	-		39,035		-		39,035		5,525
Tax impacts	-		(9,759)		-		(9,759)		(1,381)
Non-GAAP net income (loss)	743,966		(70,794)		(4,268)		668,904		94,679

 

 

Hello Group Inc.
Unaudited Condensed Segment Report
(All amounts in thousands, except share and per share data)
	First half year
	Ended June 30, 2021
	Momo		Tantan		QOOL		Total		Total
	RMB		RMB		RMB		RMB		US$
Net revenues:
Live video service	3,595,710		467,717		-		4,063,427		629,345
Value-added service	2,349,235		613,536		-		2,962,771		458,875
Mobile marketing	90,318		-		-		90,318		13,988
Mobile games	20,366		-		-		20,366		3,154
Other services	3,674		-		1,754		5,428		841
Total net revenues	6,059,303		1,081,253		1,754		7,142,310		1,106,203
Cost and expenses (v):
Cost of revenues	(3,453,399)		(547,186)		(7,989)		(4,008,574)		(620,849)
Research and development	(400,701)		(154,117)		-		(554,818)		(85,930)
Sales and marketing	(705,767)		(556,976)		(1,066)		(1,263,809)		(195,739)
General and administrative	(300,356)		45,084		(9,437)		(264,709)		(40,998)
Total cost and expenses	(4,860,223)		(1,213,195)		(18,492)		(6,091,910)		(943,516)
Other operating income	85,406		30,736		26		116,168		17,992
Income (loss) from operations	1,284,486		(101,206)		(16,712)		1,166,568		180,679
Interest income	190,455		596		91		191,142		29,604
Interest expense	(36,663)		-		-		(36,663)		(5,678)
Other gain or loss, net	(18,000)		-		-		(18,000)		(2,788)
Income (loss) before income tax and    share of income on equity method    investments	1,420,278		(100,610)		(16,621)		1,303,047		201,817
Income tax (expenses) benefits	(389,946)		7,039		-		(382,907)		(59,305)
Income (loss) before share of income    on equity method investments	1,030,332		(93,571)		(16,621)		920,140		142,512
Share of income on equity method    investments	2,303		-		-		2,303		357
Net income (loss)	1,032,635		(93,571)		(16,621)		922,443		142,869
(v) Share-based compensation was allocated in cost of revenues and operating expenses as follows:
	First half year
	Ended June 30, 2021
	Momo		Tantan		QOOL		Total		Total
	RMB		RMB		RMB		RMB		US$
Cost of revenues	4,965		2,960		-		7,925		1,227
Research and development	60,188		13,986		-		74,174		11,488
Sales and marketing	25,877		6,267		-		32,144		4,978
General and administrative	160,792		(69,120)		-		91,672		14,198
Total cost and expenses	251,822		(45,907)		-		205,915		31,891

 

 

Hello Group Inc.
Reconciliation of GAAP and NON-GAAP Results of Unaudited Segment Report
(All amounts in thousands, except share and per share data)
	First half year
	ended June 30, 2021
	Momo		Tantan		QOOL		Total		Total
	RMB		RMB		RMB		RMB		US$
Operating income (loss)	1,284,486		(101,206)		(16,712)		1,166,568		180,679
Share-based compensation	251,822		(45,907)		-		205,915		31,891
Amortization of intangible assets    from business acquisitions	-		70,553		-		70,553		10,928
Non-GAAP operating income (loss)	1,536,308		(76,560)		(16,712)		1,443,036		223,498
Net income (loss)	1,032,635		(93,571)		(16,621)		922,443		142,869
Share-based compensation	251,822		(45,907)		-		205,915		31,891
Amortization of intangible assets    from business acquisitions	-		70,553		-		70,553		10,928
Tax impacts	-		(17,639)		-		(17,639)		(2,732)
Non-GAAP net income (loss)	1,284,457		(86,564)		(16,621)		1,181,272		182,956

 

 

Hello Group Inc.
Unaudited Condensed Segment Report
(All amounts in thousands, except share and per share data)
	First half year
	Ended June 30, 2020
	Momo		Tantan		QOOL		Total		Total
	RMB		RMB		RMB		RMB		US$
Net revenues:
Live video service	4,737,168		197,712		-		4,934,880		698,487
Value-added service	1,678,907		701,167		-		2,380,074		336,878
Mobile marketing	95,119		-		-		95,119		13,463
Mobile games	24,255		-		-		24,255		3,433
Other services	7,358		-		20,650		28,008		3,964
Total net revenues	6,542,807		898,879		20,650		7,462,336		1,056,225
Cost and expenses (vi):
Cost of revenues	(3,528,959)		(364,723)		(19,539)		(3,913,221)		(553,880)
Research and development	(386,674)		(154,487)		-		(541,161)		(76,596)
Sales and marketing	(731,560)		(629,714)		(34)		(1,361,308)		(192,681)
General and administrative	(297,296)		(47,508)		(12,506)		(357,310)		(50,574)
Total cost and expenses	(4,944,489)		(1,196,432)		(32,079)		(6,173,000)		(873,731)
Other operating income	117,309		-		139		117,448		16,624
Income (loss) from operations	1,715,627		(297,553)		(11,290)		1,406,784		199,118
Interest income	237,054		2,161		144		239,359		33,879
Interest expense	(39,940)		-		-		(39,940)		(5,653)
Other gain or loss, net	(6,000)		-		-		(6,000)		(849)
Income (loss) before income tax and    share of income on equity method    investments	1,906,741		(295,392)		(11,146)		1,600,203		226,495
Income tax (expenses) benefits	(612,490)		5,966		-		(606,524)		(85,848)
Income (loss) before share of income    on equity method investments	1,294,251		(289,426)		(11,146)		993,679		140,647
Share of loss on equity method    investments	(440)		-		-		(440)		(62)
Net income (loss)	1,293,811		(289,426)		(11,146)		993,239		140,585
(vi) Share-based compensation was allocated in cost of revenues and operating expenses as follows:
	First half year
	ended June 30, 2020
	Momo		Tantan		QOOL		Total		Total
	RMB		RMB		RMB		RMB		US$
Cost of revenues	9,007		766		-		9,773		1,383
Research and development	63,472		29,273		-		92,745		13,127
Sales and marketing	84,346		5,851		-		90,197		12,767
General and administrative	133,234		21,401		5,277		159,912		22,634
Total cost and expenses	290,059		57,291		5,277		352,627		49,911

 

Hello Group Inc.
Reconciliation of GAAP and NON-GAAP Results of Unaudited Segment Report
(All amounts in thousands, except share and per share data)
	First half year
	ended June 30, 2020
	Momo		Tantan		QOOL		Total		Total
	RMB		RMB		RMB		RMB		US$
Operating income (loss)	1,715,627		(297,553)		(11,290)		1,406,784		199,118
Share-based compensation	290,059		57,291		5,277		352,627		49,911
Amortization of intangible assets    from business acquisitions	-		77,484		-		77,484		10,966
Non-GAAP operating income (loss)	2,005,686		(162,778)		(6,013)		1,836,895		259,995
Net income (loss)	1,293,811		(289,426)		(11,146)		993,239		140,585
Share-based compensation	290,059		57,291		5,277		352,627		49,911
Amortization of intangible assets    from business acquisitions	-		77,484		-		77,484		10,966
Tax impacts	-		(19,371)		-		(19,371)		(2,742)
Non-GAAP net income (loss)	1,583,870		(174,022)		(5,869)		1,403,979		198,720

 

 

View original content:https://www.prnewswire.com/news-releases/hello-group-inc-announces-unaudited-financial-results-for-the-second-quarter-of-2021-301363441.html

SOURCE Hello Group Inc.

FAQ

What were Hello Group's Q2 2021 financial results for MOMO?

Hello Group reported Q2 2021 net revenues of RMB3,671.7 million (US$568.7 million), down 5.1% year-over-year, with a net income of RMB464.2 million (US$71.9 million).

How many monthly active users does MOMO have as of June 2021?

MOMO had 115.6 million monthly active users in June 2021, an increase from 111.5 million in June 2020.

What is the revenue forecast for Hello Group in Q3 2021?

Hello Group expects Q3 2021 total net revenues to be between RMB3.65 billion and RMB3.75 billion, reflecting a year-over-year decline of up to 3.1%.

What are the key negative financial trends reported by Hello Group?

Key negatives include a 5.1% drop in total net revenues, a decrease in non-GAAP net income, and a significant 19.3% decline in live video service revenues.