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Momo Announces Unaudited Financial Results for the Fourth Quarter and Fiscal Year 2019

BEIJING, March 19, 2020 /PRNewswire/ -- Momo Inc. (NASDAQ: MOMO) ("Momo" or the "Company"), a leading mobile social networking platform in China, today announced its unaudited financial results for the fourth quarter and the full year ended December 31, 2019

Fourth Quarter of 2019 Highlights

  • Net revenues increased by 22% year over year to RMB4,687.9 million (US$673.4 million*) in the fourth quarter of 2019.
  • Net income attributable to Momo Inc. increased to RMB1,055.9 million (US$151.7 million) in the fourth quarter of 2019 from RMB660.8 million in the same period of 2018.
  • Non-GAAP net income attributable to Momo Inc. (note 1) increased to RMB1,252.5 million (US$179.9 million) in the fourth quarter of 2019, from RMB887.4 million in the same period of 2018.
  • Diluted net income per American Depositary Share ("ADS") was RMB4.74 (US$0.68) in the fourth quarter of 2019, compared to RMB3.04 in the same period of 2018.
  • Non-GAAP diluted net income per ADS (note 1) was RMB5.61 (US$0.81) in the fourth quarter of 2019, compared to RMB4.05 in the same period of 2018.
  • Monthly Active Users ("MAU") on Momo application were 114.5 million in December 2019, compared to 113.3 million in December 2018.
  • Total paying users of our live video service and value-added service, without double counting the overlap and including 4.5 million paying users of Tantan, were 13.8 million for the fourth quarter of 2019, compared to 13.0 million for the fourth quarter of 2018, which included 3.9 million paying users of Tantan.

Full Year 2019 Highlights

  • Net revenues increased 27% year over year to RMB17,015.1 million (US$2,444.1 million) for the full year of 2019.
  • Net income attributable to Momo Inc. was RMB2,970.9 million (US$426.7 million) for the full year of 2019, compared with RMB2,815.8 million for 2018.
  • Non-GAAP net income attributable to Momo Inc. (note 1) was RMB4,493.3 million (US$645.4 million) for the full year of 2019, compared with RMB3,462.1 million for 2018.
  • Diluted net income per ADS was RMB13.52 (US$1.94) for the full year of 2019, compared with RMB13.18 for 2018.
  • Non-GAAP diluted net income per ADS (note 1) was RMB20.26 (US$2.91) for the full year of 2019, compared with RMB16.17 for 2018.

* 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 RMB6.9618 to US$1.00, the effective noon buying rate for December 31, 2019 as set forth in the H.10 statistical release of the Federal Reserve Board.

"2019 was a fruitful year, with total net revenue up by 27%, net income up by 6% and Non-GAAP net income up by 30%. The strong financial performance is a testament of the competence of our team," commented Yan Tang, Chairman and CEO of Momo. "Looking into the year 2020, we are going to continue to focus on enhancing user experience and drive product innovations in order to capture the many growth opportunities ahead of us."

Fourth Quarter of 2019 Financial Results

Net revenues

Total net revenues were RMB4,687.9 million (US$673.4 million) in the fourth quarter of 2019, an increase of 22% from RMB3,843.9 million in the fourth quarter of 2018.

Live video service revenues were RMB3,383.5 million (US$486.0 million) in the fourth quarter of 2019, an increase of 14% from RMB2,959.2 million during the same period of 2018, as a result of the effective growth strategy to apply different products and operational efforts for different cohorts of users.

Value-added service revenues mainly include virtual gift revenues and membership subscription revenues. Total value-added service revenues were RMB1,189.1 million (US$170.8 million) in the fourth quarter of 2019, an increase of 65% from RMB722.4 million during the same period of 2018. The year-over-year increase was primarily attributable to the continued growth of the virtual gift business on the Momo application driven by more functions launched and more paying scenarios introduced to enhance the social experience of Momo users, and to a lesser extent, the increase in the membership subscription revenues of Tantan.

Mobile marketing revenues were RMB93.0 million (US$13.4 million) in the fourth quarter of 2019, a decrease of 24% from RMB122.1 million during the same period of 2018. The decrease in mobile marketing revenues was primarily caused by the decreased demand from our advertising and marketing customers and the decrease in advertisement properties on Momo's platform.

Mobile games revenues were RMB14.4 million (US$2.1 million) in the fourth quarter of 2019, a decrease of 43% from RMB25.5 million in the fourth quarter of 2018. The decrease in mobile game revenues was mainly due to the continued decrease in quarterly paying users of mobile games.

Net revenues from Momo segment increased from RMB3,609.3 million in the fourth quarter of 2018 to RMB4,317.3 million (US$620.1 million) in the fourth quarter of 2019, primarily driven by the significant increase in net revenues from live video service and value-added service. Net revenues from Tantan segment increased from RMB223.0 million in the fourth quarter of 2018 to RMB369.8 million (US$53.1million) in the fourth quarter of 2019, which was mainly due to the increase in the number of paying users of Tantan.

Cost and expenses

Cost and expenses were RMB3,581.1 million (US$514.4 million) in the fourth quarter of 2019, an increase of 12% from RMB3,195.7 million in the fourth quarter of 2018. The increase was primarily attributable to: (a) an increase in revenue sharing with broadcasters related to our live video service and virtual gift recipients; (b) an increase in marketing and promotional expenses to attract users on both Momo and Tantan platforms and to promote our live video services; (c) an increase in infrastructure-related spending, such as bandwidth costs and server depreciation costs, driven by more functions introduced on Momo's platform. The increase was partially offset by a decrease in production cost in connection with a television program.

Non-GAAP cost and expenses (note 1) were RMB3,374.9 million (US$484.8 million) in the fourth quarter of 2019, an increase of 14% from RMB2,959.6 million during the same period of 2018.

Other operating income

Other operating income was RMB142.6 million (US$20.5 million) in the fourth quarter of 2019, an increase from RMB141.4 million during the fourth quarter of 2018. The other operating income mainly consisted of government incentives.

Income from operations

Income from operations was RMB1,249.4 million (US$179.5 million) in the fourth quarter of 2019, compared to RMB789.6 million during the same period of 2018. Income from operations of Momo segment was RMB1,458.5 million (US$209.5 million) in the fourth quarter of 2019, increasing from RMB1,092.6 million in the fourth quarter of 2018. Loss from operations of Tantan segment was RMB202.7 million (US$29.1 million) in the fourth quarter of 2019, compared to loss from operations of RMB219.9 million in the fourth quarter of 2018.

Non-GAAP income from operations (note 1) was RMB1,455.7 million (US$209.1 million) in the fourth quarter of 2019, compared to RMB1,025.7 million during the same period of 2018. Non-GAAP income from operations of Momo segment was RMB1,593.9 million (US$229.0 million) in the fourth quarter of 2019, increasing from RMB1,200.8 million in the fourth quarter of 2018. Non-GAAP loss from operations of Tantan segment was RMB135.0 million (US$19.4 million) in the fourth quarter of 2019, compared to non-GAAP loss from operations of RMB92.6 million in the fourth quarter of 2018.

Income tax expenses

Income tax expenses were RMB253.7 million (US$36.4 million) in the fourth quarter of 2019, increasing from RMB183.3 million in the fourth quarter of 2018. The increase was mainly because we generated higher profit in the fourth quarter of 2019.

Net income

Net income was RMB1,052.3 million (US$151.2 million) in the fourth quarter of 2019, compared to RMB646.4 million during the same period of 2018. Net income from Momo segment was RMB1,246.9 million (US$179.1 million) in the fourth quarter of 2019, increasing from RMB940.5 million in the fourth quarter of 2018. Net loss from Tantan segment was RMB188.2 million (US$27.0 million) in the fourth quarter of 2019, compared to net loss of RMB206.4 million in the fourth quarter of 2018.

Non-GAAP net income (note 1) was RMB1,248.9 million (US$179.4 million) in the fourth quarter of 2019, compared to RMB873.0 million during the same period of 2018. Non-GAAP net income from Momo segment was RMB1,382.3 million (US$198.6 million) in the fourth quarter of 2019, increasing from RMB1,048.7 million in the fourth quarter of 2018. Non-GAAP net loss of Tantan segment was RMB130.2 million (US$18.7 million) in the fourth quarter of 2019, compared to non-GAAP net loss of RMB88.5 million in the fourth quarter of 2018.

Net income attributable to Momo Inc.

Net income attributable to Momo Inc. was RMB1,055.9 million (US$151.7 million) in the fourth quarter of 2019, compared to RMB660.8 million during the same period of 2018.

Non-GAAP net income (note 1) attributable to Momo Inc. was RMB1,252.5 million (US$179.9 million) in the fourth quarter of 2019, compared to RMB887.4 million during the same period of 2018.

Net income per ADS

Diluted net income per ADS was RMB4.74 (US$0.68) in the fourth quarter of 2019, compared to RMB3.04 in the fourth quarter of 2018.

Non-GAAP diluted net income per ADS (note 1) was RMB5.61 (US$0.81) in the fourth quarter of 2019, compared to RMB4.05 in the fourth quarter of 2018.

Cash and cash flow

As of December 31, 2019, Momo's cash, cash equivalents and term deposits totaled RMB14,925.3 million (US$2,143.9 million), compared to RMB11,292.6 million as of December 31, 2018. Net cash provided by operating activities in the fourth quarter of 2019 was RMB1,675.1 million (US$240.6 million), compared to RMB1,163.4 million in the fourth quarter of 2018.

Full Year 2019 Financial Results

Net revenues for the full year of 2019 were RMB17,015.1 million (US$2,444.1 million), an increase of 27% from RMB13,408.4 million in the same period of 2018, primarily driven by the significant increase in net revenues from live video service and value-added service.

Net income attributable to Momo Inc. was RMB2,970.9 million (US$426.7 million) for the full year of 2019, compared to RMB2,815.8 million during the same period of 2018.

Non-GAAP net income attributable to Momo Inc. (note 1) was RMB4,493.3 million (US$645.4 million) for the full year of 2019, compared to RMB3,462.1 million during the same period of 2018.

Diluted net income per ADS was RMB13.52 (US$1.94) during the full year of 2019, compared to RMB13.18 in the same period of 2018.

Non-GAAP diluted net income per ADS (note 1) was RMB20.26 (US$2.91) during the full year of 2019, compared to RMB16.17 in the same period of 2018.

Net cash provided by operating activities was RMB5,448.9 million (US$782.7 million) during the full year of 2019, compared to RMB3,327.7 million in the same period of 2018.

Recent Development - Declaration of Special Cash Dividend

Momo's board of directors has declared a special cash dividend in the amount of US$0.76 per ADS, or US$0.38 per ordinary share. The cash dividend will be paid on April 30, 2020 to shareholders of record at the close of business on April 8, 2020. The ex-dividend date will be April 7, 2020. The aggregate amount of cash dividends to be paid is approximately US$161 million, which will be funded by surplus cash on the Company's balance sheet.

Business Outlook

For the first quarter of 2020, the Company expects total net revenues to be between RMB3.45 billion to RMB3.55 billion, representing a decrease of 7.3% to 4.6% year over year. This forecast considers the potential impact of the COVID-19 outbreak and reflects the Company's current and preliminary views on the market and operational conditions, which are subject to change, particularly as to the potential impact of the COVID-19 on the economy in China.

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 Momo 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

Momo's management will host an earnings conference call on Thursday, March 19, 2020, at 8:00 a.m. U.S. Eastern Time (8:00 p.m. Beijing / Hong Kong Time on March 19, 2020).

Dial-in details for the earnings conference call are as follows:

International:

+65-6713-5090

U.S. Toll Free:

+1-866-519-4004

Hong Kong Toll Free:

800-906601

Mainland China: 

4006-208038

Passcode:

Momo

Please dial in 15 minutes before the call is scheduled to begin.

A telephone replay of the call will be available after the conclusion of the conference call through 8:00 a.m. U.S. Eastern Time, March 26, 2020. The dial-in details for the replay are as follows:

International: 

+61-2-8199-0299

U.S. Toll Free:

+1-855-452-5696

Passcode: 

3264508

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

About Momo

Momo is a leading mobile social networking platform in China. Momo connects people in a personal and lively way through a revolutionary mobile-based social networking platform. With powerful and precise location-based features, Momo enables users to connect with each other and expand relationships from online to offline. Momo's platform includes the Momo mobile application and a variety of related features, functionalities, tools and services that it provides to users, customers and platform partners. Leveraging its social interest graph engine and analysis of user behavior data, Momo is able to provide users a customized experience based on their social preferences and needs. Momo users can maintain and strengthen their relationships through private and group communication tools, content creation and sharing functions, as well as the offline social activities promoted on Momo's platform. Momo users are also able to enjoy live video on our platform. In addition, in May 2018, Momo completed its acquisition of Tantan, a leading social and dating app for the younger generation. Tantan, whose primary users consist of young Chinese singles, is designed to help its users find and establish romantic connections, as well as meet interesting people.

For investor and media inquiries, please contact:

Momo Inc.

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

Christensen

In China
Mr. Christian Arnell
Phone: +86-10-5900-1548
E-mail: carnell@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 and our financial outlook for the first quarter of 2020. 

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 fourth quarter and full year of 2019 are preliminary, unaudited and subject to audit adjustment. In addition, we may not meet our financial outlook for the first quarter of 2020 and may be unable to grow our business in the manner planned. We may also modify our strategy for growth.  In addition, 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, and the impact of the COVID-19 to Momo's business operations and the economy in China. 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.

Momo Inc.

Unaudited Condensed Consolidated Statement of Operations

(All amounts in thousands, except share and per share data)



Three months


Year

ended  December 31


ended  December 31


2018


2019


2019


2018


2019


2019


RMB


RMB


US$


RMB


RMB


US$

Net revenues:












     Live video service

2,959,222


3,383,477


486,006


10,709,491


12,448,131


1,788,062

     Value-added service

722,414


1,189,114


170,806


1,883,150


4,105,963


589,785

     Mobile marketing

122,143


92,991


13,357


500,321


331,822


47,663

     Mobile games

25,502


14,418


2,071


130,392


92,451


13,280

     Other services

14,635


7,898


1,134


185,067


36,722


5,275

Total net revenues

3,843,916


4,687,898


673,374


13,408,421


17,015,089


2,444,065

Cost and expenses:












     Cost of revenues

(2,099,265)


(2,351,309)


(337,744)


(7,182,897)


(8,492,096)


(1,219,813)

     Research and development

(243,499)


(292,188)


(41,970)


(760,644)


(1,095,031)


(157,291)

     Sales and marketing

(618,268)


(725,029)


(104,144)


(1,812,262)


(2,690,824)


(386,513)

     General and administrative

(234,700)


(212,603)


(30,539)


(640,023)


(1,527,282)


(219,380)

Total cost and expenses

(3,195,732)


(3,581,129)


(514,397)


(10,395,826)


(13,805,233)


(1,982,997)

Other operating income

141,420


142,646


20,490


253,697


344,843


49,534

Income from operations

789,604


1,249,415


179,467


3,266,292


3,554,699


510,602

Interest income

89,766


108,205


15,543


272,946


407,542


58,540

Interest expense

(19,646)


(20,190)


(2,900)


(56,503)


(78,611)


(11,292)

Impairment loss on long-term
     investments

(43,200)


-


-


(43,200)


(15,711)


(2,257)

Income before income tax
     and share of income on
     equity method
     investments

816,524


1,337,430


192,110


3,439,535


3,867,919


555,593

Income tax expenses

(183,338)


(253,704)


(36,442)


(699,648)


(883,801)


(126,950)

Income before share of
     income on equity method
     investments

633,186


1,083,726


155,668


2,739,887


2,984,118


428,643

Share of income (loss) on
     equity method investments

13,221


(31,406)


(4,511)


48,660


(23,350)


(3,354)

Net income

646,407


1,052,320


151,157


2,788,547


2,960,768


425,289

Less: net loss attributable to
     non-controlling interest

(14,430)


(3,579)


(514)


(27,228)


(10,122)


(1,454)

Net income attributable to
     Momo Inc.

660,837


1,055,899


151,671


2,815,775


2,970,890


426,743













Net income per share
     attributable to ordinary
     shareholders

Basic

1.60


2.53


0.36


6.92


7.15


1.03

Diluted

1.52


2.37


0.34


6.59


6.76


0.97

Weighted average shares
     used in calculating net
     income per ordinary share












Basic

413,732,538


416,878,784


416,878,784


407,009,875


415,316,627


415,316,627

Diluted

447,773,521


453,937,852


453,937,852


433,083,643


451,206,091


451,206,091

 

 

Momo Inc.

Unaudited Condensed Consolidated Statement of Comprehensive Income

(All amounts in thousands, except share and per share data)









Three months


Year

ended December 31


ended December 31


2018


2019


2019


2018


2019


2019


RMB


RMB


US$


RMB


RMB


US$

Net income 

646,407


1,052,320


151,157


2,788,547


2,960,768


425,289

Other comprehensive income
     (loss), net of tax












Foreign currency translation
     adjustment

5,171


(39,524)


(5,677)


198,654


(8,835)


(1,269)

Comprehensive income 

651,578


1,012,796


145,480


2,987,201


2,951,933


424,020

Less: comprehensive loss
     attributed to the non-controlling
     interest

(14,535)


(8,637)


(1,241)


(24,613)


(8,081)


(1,161)

Comprehensive income
     attributable to Momo Inc.

666,113


1,021,433


146,721


3,011,814


2,960,014


425,181

 

Momo Inc.

Unaudited Condensed Consolidated Balance Sheets

(All amounts in thousands, except share and per share data)








December 31


December 31


December 31


2018


2019


2019


RMB

RMB


US$

Assets






Current assets






     Cash and cash equivalents

2,468,034


2,612,743


375,297

     Term deposits

8,824,610


12,312,585


1,768,592

     Accounts receivable, net of allowance for doubtful accounts of RMB
          nil and RMB12,209 as of December 31, 2018 and 2019,
          respectively

719,606


265,155


38,087

     Amounts due from a related party

-


4,382


629

     Prepaid expenses and other current assets

620,979


599,000


86,041

Total current assets

12,633,229


15,793,865


2,268,646

     Long-term deposit

-


300,000


43,092

     Right-of-use assets, net[1]

-


190,552


27,371

     Property and equipment, net

387,532


346,345


49,749

     Intangible assets

1,036,986


890,303


127,884

     Rental deposits

24,192


25,028


3,595

     Long-term investments

447,465


495,905


71,232

     Deferred tax assets

57,786


37,064


5,324

     Other non-current assets

71,519


44,009


6,322

     Goodwill

4,306,829


4,360,610


626,362

Total assets

18,965,538


22,483,681


3,229,577

Liabilities and equity






Current liabilities






     Accounts payable

718,362


714,323


102,604

     Deferred revenue

441,892


503,461


72,318

     Accrued expenses and other current liabilities

846,710


985,873


141,611

     Amount due to related parties

82,948


29,606


4,253

     Lease liabilities due within one year[1]

-


135,169


19,416

     Income tax payable

137,090


153,976


22,117

     Deferred consideration in connection with business acquisitions

469,274


84,346


12,116

Total current liabilities

2,696,276


2,606,754


374,435

     Deferred tax liabilities

259,247


222,576


31,971

     Convertible senior notes

4,877,116


4,954,352


711,648

     Share-based compensation liability

86,767


902,047


129,571

     Lease liabilities[1]

-


56,498


8,115

     Other non-current liabilities

23,273


22,672


3,257

Total liabilities

7,942,679


8,764,899


1,258,997

Shareholder's equity (i)

11,022,859


13,718,782


1,970,580

Total liabilities and shareholder's equity

18,965,538


22,483,681


3,229,577













(i): As of December 31, 2019, the number of ordinary shares issued and outstanding was 417,279,310.







[1] On January 1, 2019, the Company adopted ASU 2016-02, the new lease standard, using the modified retrospective basis
and did not restate comparative periods.

 

Momo Inc.

Unaudited Condensed Consolidated Statement of Cash Flows

(All amounts in thousands, except share and per share data)


Three months


Year


ended December 31


ended December 31


2018


2019


2019


2018


2019


2019


RMB


RMB


US$


RMB


RMB


US$

Cash flows from operating activities:












Net income 

646,407


1,052,320


151,157


2,788,547


2,960,768


425,289

Adjustments to reconcile net income to net cash provided by operating
activities:












     Depreciation of property and equipment

42,244


51,385


7,381


148,238


198,237


28,475

     Amortization of intangible assets

39,522


40,239


5,780


93,030


157,954


22,689

     Share-based compensation

198,013


167,458


24,054


580,813


1,408,232


202,279

     Share of (income) loss on equity method investments

(13,221)


31,406


4,511


(48,660)


23,350


3,354

     Impairment loss on long-term investments

43,200


-


-


43,200


15,711


2,257

     Income on disposal of property and equipment

(44)


-


-


(1,283)


(398)


(57)

     Provision of allowance for doubtful accounts

-


-


-


(585)


12,209


1,754

Changes in operating assets and liabilities:












     Accounts receivable

(84,973)


110,340


15,849


(440,644)


442,176


63,515

     Prepaid expenses and other current assets

14,190


49,554


7,118


(67,304)


26,372


3,788

     Amount due from related parties

56


(2,776)


(399)


33,463


(4,382)


(629)

     Rental deposits

(4,062)


(474)


(68)


(3,817)


(836)


(120)

     Deferred tax assets

(39,874)


(2,582)


(371)


(10,961)


20,722


2,977

     Other non-current assets

(670)


(3,411)


(490)


(45,534)


(24,022)


(3,451)

     Accounts payable

(18,987)


98,021


14,080


233,713


52,246


7,505

     Income tax payable

81,097


39,938


5,737


(38,791)


16,886


2,426

     Deferred revenue

12,470


6,852


984


(14,249)


61,641


8,854

     Accrued expenses and other current liabilities

235,104


75,791


10,887


51,903


212,349


30,502

     Amount due to related parties

25,349


235


34


43,024


(53,032)


(7,618)

     Deferred tax liability

(9,547)


(10,060)


(1,445)


(22,923)


(45,382)


(6,519)

     Other non-current liabilities

(2,915)


(29,153)


(4,188)


6,538


(31,915)


(4,584)

Net cash provided by operating activities

1,163,359


1,675,083


240,611


3,327,718


5,448,886


782,686

Cash flows from investing activities:












     Purchase of property and equipment

(81,243)


(32,109)


(4,612)


(242,843)


(186,522)


(26,792)

     Proceeds from disposal of property and equipment

4


4


1


2,214


808


116

     Payment for long-term investments

(3,000)


(21,500)


(3,088)


(65,125)


(64,500)


(9,265)

     Prepayment of long-term investments

(8,000)


-


-


(55,000)


(15,000)


(2,155)

     Payment for business acquisition, net of cash acquired

(40,632)


-


-


(3,318,841)


-


-

     Purchase of term deposits

(5,300,000)


(7,650,000)


(1,098,854)


(20,287,302)


(22,151,135)


(3,181,811)

     Cash received on maturity of term deposits

4,600,000


6,036,000


867,017


13,922,393


18,686,430


2,684,138

     Payment for short-term investments

(103,000)


(80,000)


(11,491)


(457,200)


(360,000)


(51,711)

     Cash received from sales of short-term investment

218,000


120,000


17,237


467,700


360,000


51,711

     Purchase of long-term deposits

-


(300,000)


(43,092)


-


(300,000)


(43,092)

Net cash used in investing activities

(717,871)


(1,927,605)


(276,882)


(10,034,004)


(4,029,919)


(578,861)

Cash flows from financing activities:












     Proceeds from exercise of options

1


1


-


5,313


187


27

     Deferred payment of purchase of property and equipment

(157)


(127)


(18)


(8,562)


(17,114)


(2,458)

     Capital contribution from non-controlling interest shareholder

12


-


-


12


-


-

     Dividends payment

-


-


-


-


(877,346)


(126,023)

     Proceeds from bank loan

-


-


-


1,913,190


-


-

     Repayment of bank loan

-


-


-


(2,041,680)


-


-

     Deferred payment for business acquisition

-


-


-


-


(379,507)


(54,513)

     Proceeds from issuance of Convertible Senior Notes, net of issuance
          cost of RMB113,673

-


-


-


4,820,387


-


-

     Payment of issuance cost of convertible notes

(709)


-


-


(709)


-


-

Net cash (used in) provided by financing activities

(853)


(126)


(18)


4,687,951


(1,273,780)


(182,967)

Effect of exchange rate changes

1,439


(5,532)


(796)


24,175


(478)


(72)

Net increase (decrease) in cash, cash equivalents,and restricted
     cash 

446,074


(258,180)


(37,085)


(1,994,160)


144,709


20,786

Cash, cash equivalents, and restricted cash at beginning of period

2,021,960


2,870,923


412,382


4,462,194


2,468,034


354,511

Cash, cash equivalents, and restricted cash at end of period

2,468,034


2,612,743


375,297


2,468,034


2,612,743


375,297

 

Momo 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 December 31, 2018

ended December 31, 2019


ended December 31, 2019


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

(2,099,265)

18,471

5,498

-

(2,075,296)


(2,351,309)

18,818

7,601

-

(2,324,890)


(337,744)

2,703

1,092

-

(333,949)

Research and
     development

(243,499)

2,345

47,215

-

(193,939)


(292,188)

2,390

45,455

-

(244,343)


(41,970)

343

6,529

-

(35,098)

Sales and marketing

(618,268)

17,273

43,707

-

(557,288)


(725,029)

17,598

53,466

-

(653,965)


(104,144)

2,528

7,680

-

(93,936)

General and
     administrative

(234,700)

-

101,593

-

(133,107)


(212,603)

-

60,936

-

(151,667)


(30,539)

-

8,753

-

(21,786)

Cost and operating
     expenses

(3,195,732)

38,089

198,013

-

(2,959,630)


(3,581,129)

38,806

167,458

-

(3,374,865)


(514,397)

5,574

24,054

-

(484,769)

Income from
     operations

789,604

38,089

198,013

-

1,025,706


1,249,415

38,806

167,458

-

1,455,679


179,467

5,574

24,054

-

209,095

Net income attributable
     to Momo Inc.

660,837

38,089

198,013

(9,522)

887,417


1,055,899

38,806

167,458

(9,701)

1,252,462


151,671

5,574

24,054

(1,394)

179,905

 

Momo 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.








Year


Year


Year

ended December 31, 2018

ended December 31, 2019


ended December 31, 2019


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

(7,182,897)

42,336

21,661

-

(7,118,900)


(8,492,096)

73,817

23,972

-

(8,394,307)


(1,219,813)

10,603

3,443

-

(1,205,767)

Research and
     development

(760,644)

5,375

152,806

-

(602,463)


(1,095,031)

9,375

175,053

-

(910,603)


(157,291)

1,347

25,145

-

(130,799)

Sales and marketing

(1,812,262)

39,589


-

(1,629,746)


(2,690,824)

69,031

196,311

-

(2,425,482)


(386,513)

9,916

28,198

-

(348,399)

142,927

General and
     administrative

(640,023)

-

263,419

-

(376,604)


(1,527,282)

-

1,012,896

-

(514,386)


(219,380)

-

145,493

-

(73,887)

Cost and operating
     expenses

(10,395,826)

87,300

580,813

-

(9,727,713)


(13,805,233)

152,223

1,408,232

-

(12,244,778)


(1,982,997)

21,866

202,279

-

(1,758,852)

Income from
     operations

3,266,292

87,300

580,813

-

3,934,405


3,554,699

152,223

1,408,232

-

5,115,154


510,602

21,866

202,279

-

734,747

Net income attributable
     to Momo Inc.

2,815,775

87,300

580,813

(21,823)

3,462,065


2,970,890

152,223

1,408,232

(38,056)

4,493,289


426,743

21,866

202,279

(5,466)

645,422

















(ii) Includes tax impacts related to the amortization of intangible assets from business acquisition. There is no tax impact related to share-based compensation.







 

Momo Inc.

Unaudited Segment Report

(All amounts in thousands, except share and per share data)



Three months

  ended   December 31, 2019


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Net revenues:










     Live video service

3,383,477


-


-


3,383,477


486,006

     Value-added service

819,325


369,789


-


1,189,114


170,806

     Mobile marketing

92,991


-


-


92,991


13,357

     Mobile games

14,418


-


-


14,418


2,071

     Other services

7,111


-


787


7,898


1,134

Total net revenues

4,317,322


369,789


787


4,687,898


673,374

Cost and expenses (iii):










     Cost of revenues

(2,222,912)


(127,748)


(649)


(2,351,309)


(337,744)

     Research and development

(205,793)


(86,395)


-


(292,188)


(41,970)

     Sales and marketing

(379,940)


(345,089)


-


(725,029)


(104,144)

     General and administrative

(192,789)


(13,275)


(6,539)


(212,603)


(30,539)

Total cost and expenses

(3,001,434)


(572,507)


(7,188)


(3,581,129)


(514,397)

Other operating income

142,613


-


33


142,646


20,490

Income (loss) from operations

1,458,501


(202,718)


(6,368)


1,249,415


179,467

Interest income

105,947


2,197


61


108,205


15,543

Interest expense

(20,190)


-


-


(20,190)


(2,900)

Income (loss) before income tax
     and share of income on equity
     method investments

1,544,258


(200,521)


(6,307)


1,337,430


192,110

Income tax (expenses) benefits

(265,981)


12,277


-


(253,704)


(36,442)

Income (loss) before share of
     income on equity method
     investments

1,278,277


(188,244)


(6,307)


1,083,726


155,668

Share of loss on equity method
     investments

(31,406)


-


-


(31,406)


(4,511)

Net income (loss)

1,246,871


(188,244)


(6,307)


1,052,320


151,157











(iii) Share-based compensation was allocated in cost of revenues and operating expenses as follows:














Three months


ended December 31, 2019


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Cost of revenues

6,000


1,601


-


7,601


1,092

Research and development

26,980


18,475


-


45,455


6,529

Sales and marketing

45,971


7,495


-


53,466


7,680

General and administrative

56,467


1,384


3,085


60,936


8,753

Total cost and expenses

135,418


28,955


3,085


167,458


24,054

 

Momo 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 December 31, 2019


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Operating income (loss)

1,458,501


(202,718)


(6,368)


1,249,415


179,467

Share-based compensation

135,418


28,955


3,085


167,458


24,054

Amortization of intangible assets from
     business acquisitions

-


38,806


-


38,806


5,574

Non-GAAP operating income (loss)

1,593,919


(134,957)


(3,283)


1,455,679


209,095











Net income (loss)

1,246,871


(188,244)


(6,307)


1,052,320


151,157

Share-based compensation

135,418


28,955


3,085


167,458


24,054

Amortization of intangible assets from
     business acquisitions

-


38,806


-


38,806


5,574

Tax impacts

-


(9,701)


-


(9,701)


(1,394)

Non-GAAP net income (loss)

1,382,289


(130,184)


(3,222)


1,248,883


179,391

 

Momo Inc.

Unaudited Segment Report

(All amounts in thousands, except share and per share data)



Three months

ended December 31, 2018


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$[2] 

Net revenues:










     Live video service

2,959,222


-


-


2,959,222


430,401

     Value-added service

499,446


222,968


-


722,414


105,071

     Mobile marketing

122,143


-


-


122,143


17,765

     Mobile games

25,502


-


-


25,502


3,709

     Other services

2,970


-


11,665


14,635


2,128

Total net revenues

3,609,283


222,968


11,665


3,843,916


559,074

Cost and expenses (iv):










     Cost of revenues

(1,960,632)


(82,758)


(55,875)


(2,099,265)


(305,325)

     Research and development

(202,486)


(41,013)


-


(243,499)


(35,415)

     Sales and marketing

(363,798)


(251,286)


(3,184)


(618,268)


(89,923)

     General and administrative

(130,062)


(67,935)


(36,703)


(234,700)


(34,136)

Total cost and expenses

(2,656,978)


(442,992)


(95,762)


(3,195,732)


(464,799)

Other operating income

140,269


85


1,066


141,420


20,569

Income (loss) from operations

1,092,574


(219,939)


(83,031)


789,604


114,844

Interest income

85,694


4,049


23


89,766


13,056

Interest expense

(19,646)


-


-


(19,646)


(2,857)

Impairment loss on long-term investments

(43,200)


-


-


(43,200)


(6,283)

Income (loss) before income tax and share
     of income on equity method investments

1,115,422


(215,890)


(83,008)


816,524


118,760

Income tax (expenses) benefits

(188,117)


9,522


(4,743)


(183,338)


(26,665)

Income (loss) before share of income on
     equity method investments

927,305


(206,368)


(87,751)


633,186


92,095

Share of income on equity method investments

13,221


-


-


13,221


1,923

Net income (loss)

940,526


(206,368)


(87,751)


646,407


94,018











(ii)            Share-based compensation was allocated in cost of revenues and operating expenses as follows:













Three months


ended December 31, 2018


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Cost of revenues

4,126


1,372


-


5,498


800

Research and development

24,067


23,148


-


47,215


6,867

Sales and marketing

37,718


5,989


-


43,707


6,357

General and administrative

42,271


58,756


566


101,593


14,776

Total cost and expenses

108,182


89,265


566


198,013


28,800































[2] All translations from RMB to U.S. dollars are made at a rate of RMB 6.8755 to US$1.00, the effective noon buying rate for
December 31, 2018 as set forth in the H.10 statistical release of the Federal Reserve Board.

 

Momo 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 December 31, 2018


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Operating income (loss)

1,092,574


(219,939)


(83,031)


789,604


114,844

Share-based compensation

108,182


89,265


566


198,013


28,800

Amortization of intangible assets from
     business acquisitions

-


38,089


-


38,089


5,539

Non-GAAP operating income (loss)

1,200,756


(92,585)


(82,465)


1,025,706


149,183











Net income (loss)

940,526


(206,368)


(87,751)


646,407


94,018

Share-based compensation

108,182


89,265


566


198,013


28,800

Amortization of intangible assets from
     business acquisitions

-


38,089


-


38,089


5,539

Tax impacts

-


(9,522)


-


(9,522)


(1,385)

Non-GAAP net income (loss)

1,048,708


(88,536)


(87,185)


872,987


126,972

 

Momo Inc.

Unaudited Segment Report

(All amounts in thousands, except share and per share data)


Year

  ended   December 31, 2019


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Net revenues:










     Live video service

12,448,131


-


-


12,448,131


1,788,062

     Value-added service

2,846,057


1,259,906


-


4,105,963


589,785

     Mobile marketing

331,822


-


-


331,822


47,663

     Mobile games

92,451


-


-


92,451


13,280

     Other services

22,354


-


14,368


36,722


5,275

Total net revenues

15,740,815


1,259,906


14,368


17,015,089


2,444,065

Cost and expenses (v):










     Cost of revenues

(8,065,300)


(415,688)


(11,108)


(8,492,096)


(1,219,813)

     Research and development

(797,471)


(297,560)


-


(1,095,031)


(157,291)

     Sales and marketing

(1,521,511)


(1,162,912)


(6,401)


(2,690,824)


(386,513)

     General and administrative

(641,269)


(851,099)


(34,914)


(1,527,282)


(219,380)

Total cost and expenses

(11,025,551)


(2,727,259)


(52,423)


(13,805,233)


(1,982,997)

Other operating income

323,444


-


21,399


344,843


49,534

Income (loss) from operations

5,038,708


(1,467,353)


(16,656)


3,554,699


510,602

Interest income

396,672


10,706


164


407,542


58,540

Interest expense

(78,611)


-


-


(78,611)


(11,292)

Impairment loss on long-term
     investments

(15,711)


-


-


(15,711)


(2,257)

Income (loss) before income tax
     and share of income on equity
     method investments

5,341,058


(1,456,647)


(16,492)


3,867,919


555,593

Income tax (expenses) benefits

(917,265)


33,464


-


(883,801)


(126,950)

Income (loss) before share of
     income on equity method
     investments

4,423,793


(1,423,183)


(16,492)


2,984,118


428,643

Share of income on equity method
      investments

(23,350)


-


-


(23,350)


(3,354)

Net income (loss)

4,400,443


(1,423,183)


(16,492)


2,960,768


425,289











(vi)            Share-based compensation was allocated in cost of revenues and operating expenses as follows:



Year


ended December 31, 2019


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Cost of revenues

20,393


3,579


-


23,972


3,443

Research and development

103,655


71,398


-


175,053


25,145

Sales and marketing

175,657


20,654


-


196,311


28,198

General and administrative

207,053


795,033


10,810


1,012,896


145,493

Total cost and expenses

506,758


890,664


10,810


1,408,232


202,279

 

 

Momo Inc.

Reconciliation of GAAP and NON-GAAP Results of Unaudited Segment Report

(All amounts in thousands, except share and per share data)



Year


ended December 31, 2019


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Operating income (loss)

5,038,708


(1,467,353)


(16,656)


3,554,699


510,602

Share-based compensation

506,758


890,664


10,810


1,408,232


202,279

Amortization of intangible assets
     from business acquisitions

-


152,223


-


152,223


21,866

Non-GAAP operating income (loss)

5,545,466


(424,466)


(5,846)


5,115,154


734,747











Net income (loss)

4,400,443


(1,423,183)


(16,492)


2,960,768


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