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Momo Announces Unaudited Financial Results for the Third Quarter of 2020

BEIJING, Dec. 1, 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 third quarter of 2020.

Third Quarter of 2020 Highlights

  • Net revenues decreased by 15.4% year over year to RMB3,766.7 million (US$554.8 million*) in the third quarter of 2020.
  • Net income attributable to Momo Inc. decreased to RMB456.7 million (US$67.3 million) in the third quarter of 2020 from RMB893.9 million in the same period of 2019.
  • Non-GAAP net income attributable to Momo Inc. (note 1) decreased to RMB653.8 million (US$96.3 million) in the third quarter of 2020, from RMB1,088.1 million in the same period of 2019.
  • Diluted net income per American Depositary Share ("ADS") was RMB2.11 (US$0.31) in the third quarter of 2020, compared to RMB4.04 in the same period of 2019.
  • Non-GAAP diluted net income per ADS (note 1) was RMB2.98 (US$0.44) in the third quarter of 2020, compared to RMB4.90 in the same period of 2019.
  • Monthly Active Users ("MAU") on Momo application were 113.6 million in September 2020, compared to 114.1 million in September 2019.
  • Total paying users of our live video service and value-added service, without double counting the overlap and including 4.1 million paying users of Tantan Limited ("Tantan"), were 13.1 million for the third quarter of 2020, compared to 13.4 million for the third quarter of 2019, which included 4.5 million paying users of Tantan.

First Nine Months of 2020 Highlights

  • Net revenues decreased by 8.9% year over year to RMB11,229.0 million (US$1,653.9 million) for the first nine months of 2020.
  • Net income attributable to Momo Inc. was RMB1,452.0 million (US$213.9 million) for the first nine months of 2020, compared with RMB1,915.0 million during the same period of 2019.
  • Non-GAAP net income attributable to Momo Inc. (note 1) was RMB2,059.8 million (US$303.4 million) for the first nine months of 2020, compared with RMB3,240.8 million during the same period of 2019.
  • Diluted net income per ADS was RMB6.68 (US$0.98) for the first nine months of 2020, compared with RMB8.76 during the same period of 2019.
  • Non-GAAP diluted net income per ADS (note 1) was RMB9.36 (US$1.38) for the first nine months of 2020, compared with RMB14.65 during the same period of 2019.

"The third quarter of 2020 was a busy quarter for us. As a result of management's commitment and the persistence of our colleagues, the structural reform within the core live broadcasting business has achieved initial success." Commented Li Wang, CEO of Momo. "The critical metrics reflecting the healthiness of the ecosystem have been showing positive signs. As the content ecosystem gradually improved, non-event days' revenue is also seeing strong rebound. Although we have more hard work to do down the path, what we have achieved so far gives us the confidence that our live streaming business has entered into a virtuous cycle supported by a sustainable content ecosystem."

 

* 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 RMB6.7896 to US$1.00, the effective noon buying rate for September 30, 2020 as set forth in the H.10 statistical release of the Federal Reserve Board.

 

Third Quarter of 2020 Financial Results

Net revenues

Total net revenues were RMB3,766.7 million (US$554.8 million) in the third quarter of 2020, a decrease of 15.4% from RMB4,451.6 million in the third quarter of 2019.

Live video service revenues were RMB2,374.8 million (US$349.8 million) in the third quarter of 2020, a decrease of 27% from RMB3,275.4 million during the same period of 2019. The decrease was primarily due to our structural reform on Momo's core live video business, which was used to revive the long tail content ecosystem and to a lesser extent, the impact of COVID-19 adversely affecting the sentiment of our paying users, especially among the top of the pyramid paying users. The decrease was partially offset by the growth from Tantan's live video service, and live video service revenues from Tantan were RMB396.7 million (US$58.4 million) in the third quarter of 2020.

Value-added service revenues mainly include virtual gift revenues and membership subscription revenues. Total value-added service revenues were RMB1,330.8 million (US$196.0 million) in the third quarter of 2020, an increase of 25% from RMB1,064.6 million during the same period of 2019. 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 launched and more paying scenarios introduced to enhance the social entertainment experience of Momo users, and to a lesser extent, the increase in the membership subscription revenues of Tantan.

Mobile marketing revenues were RMB50.4 million (US$7.4 million) in the third quarter of 2020, a decrease of 38% from RMB81.9 million during the same period of 2019. The decrease in mobile marketing revenues was primarily caused by the decreased demand from our advertising and marketing customers as well as our strategy to underweight the line in terms of resource allocation.

Mobile games revenues were RMB8.0 million (US$1.2 million) in the third quarter of 2020, a decrease of 49% from RMB15.8 million in the third quarter of 2019. 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 decreased from RMB4,138.9 million in the third quarter of 2019 to RMB3,037.0 million (US$447.3 million) in the third quarter of 2020, 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 Tantan segment increased from RMB310.0 million in the third quarter of 2019 to RMB728.9 million (US$107.4 million) in the third quarter of 2020, which was mainly due to the increase in net revenues from live video service and to a lesser extent, the increase in net revenues from value-added services.

Cost and expenses

Cost and expenses were RMB3,258.5 million (US$479.9 million) in the third quarter of 2020, a decrease of 6.6% from RMB3,487.9 million in the third quarter of 2019. The decrease was primarily attributable to: (a) a decrease in revenue sharing with broadcasters related to our live video service; (b) a decrease in personnel related costs, professional fees and infrastructure-related spending, such as bandwidth costs and server depreciation costs. The decrease was partially offset by an increase in revenue sharing with virtual gift recipients for our virtual gift service, and an increase in marketing and promotional expenses to attract users on Tantan.

Non-GAAP cost and expenses (note 1) were RMB3,052.0 million (US$449.5 million) in the third quarter of 2020, a decrease of 7.1% from RMB3,284.0 million during the same period of 2019.

Income from operations

Income from operations was RMB531.1 million (US$78.2 million) in the third quarter of 2020, compared to RMB993.1 million during the same period of 2019. Income from operations of Momo segment was RMB658.7 million (US$97.0 million) in the third quarter of 2020, decreasing from RMB1,227.2 million in the third quarter of 2019. Loss from operations of Tantan segment was RMB121.5 million (US$17.9 million) in the third quarter of 2020, compared to loss from operations of RMB228.7 million in the third quarter of 2019.

Non-GAAP income from operations (note 1) was RMB737.6 million (US$108.6 million) in the third quarter of 2020, compared to RMB1,196.9 million during the same period of 2019. Non-GAAP income from operations of Momo segment was RMB805.8 million (US$118.7 million) in the third quarter of 2020, decreasing from RMB1,364.1 million in the third quarter of 2019. Non-GAAP loss from operations of Tantan segment was RMB64.7 million (US$9.5 million) in the third quarter of 2020, compared to non-GAAP loss from operations of RMB164.4 million in the third quarter of 2019.

Income tax expenses

Income tax expenses were RMB143.6 million (US$21.2 million) in the third quarter of 2020, decreasing from RMB182.6 million in the third quarter of 2019. The decrease in income tax expenses was mainly due to the lower profit in the third quarter of 2020.

Net income

Net income was RMB456.0 million (US$67.2 million) in the third quarter of 2020, compared to RMB890.8 million during the same period of 2019. Net income from Momo segment was RMB576.2 million (US$84.9 million) in the third quarter of 2020, decreasing from RMB1,110.2 million in the third quarter of 2019. Net loss from Tantan segment was RMB114.2 million (US$16.8 million) in the third quarter of 2020, compared to net loss of RMB214.1 million in the third quarter of 2019.

Non-GAAP net income (note 1) was RMB653.1 million (US$96.2 million) in the third quarter of 2020, compared to RMB1,084.9 million during the same period of 2019. Non-GAAP net income from Momo segment was RMB723.4 million (US$106.5 million) in the third quarter of 2020, decreasing from RMB1,247.2 million in the third quarter of 2019. Non-GAAP net loss of Tantan segment was RMB66.9 million (US$9.8 million) in the third quarter of 2020, compared to non-GAAP net loss of RMB159.5 million in the third quarter of 2019.

Net income attributable to Momo Inc.

Net income attributable to Momo Inc. was RMB456.7 million (US$67.3 million) in the third quarter of 2020, compared to RMB893.9 million during the same period of 2019.

Non-GAAP net income (note 1) attributable to Momo Inc. was RMB653.8 million (US$96.3 million) in the third quarter of 2020, compared to RMB1,088.1 million during the same period of 2019.

Net income per ADS

Diluted net income per ADS was RMB2.11 (US$0.31) in the third quarter of 2020, compared to RMB4.04 in the third quarter of 2019.

Non-GAAP diluted net income per ADS (note 1) was RMB2.98 (US$0.44) in the third quarter of 2020, compared to RMB4.90 in the third quarter of 2019.

Cash and cash flow

As of September 30, 2020, Momo's cash, cash equivalents, short-term deposits and long-term deposits totaled RMB15,764.1 million (US$2,321.8 million), compared to RMB15,225.3 million as of December 31, 2019. Net cash provided by operating activities in the third quarter of 2020 was RMB691.1 million (US$101.8 million), compared to RMB1,175.9 million in the third quarter of 2019.

First Nine Months of 2020 Financial Results

Net revenues for the first nine months of 2020 were RMB11,229.0 million (US$1,653.9 million), a decrease of 8.9% from RMB12,327.2 million in the same period of 2019.

Net income attributable to Momo Inc. was RMB1,452.0 million (US$213.9 million) for the first nine months of 2020, compared to RMB1,915.0 million during the same period of 2019.

Non-GAAP net income attributable to Momo Inc. (note 1) was RMB2,059.8 million (US$303.4 million) for the first nine months of 2020, compared to RMB3,240.8 million during the same period of 2019.

Diluted net income per ADS was RMB6.68 (US$0.98) during the first nine months of 2020, compared to RMB8.76 in the same period of 2019.

Non-GAAP diluted net income per ADS (note 1) was RMB9.36 (US$1.38) during the first nine months of 2020, compared to RMB14.65 in the same period of 2019.

Net cash provided by operating activities was RMB2,041.8 million (US$300.7 million) during the first nine months of 2020, compared to RMB3,773.8 million in the same period of 2019.

Recent Developments

On September 3, 2020, Momo'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 November 30, 2020, the Company had repurchased approximately 1.66 million ADSs for approximately US$23.3 million on the open market under this program, at an average purchase price of US$14.03 per ADS.

Mr. Xiaoliang Lei will step down from the Company's Chief Strategy Officer position for personal reasons effective from December 2020, and he will continue to serve as a senior advisor to the Company.

Business Outlook

For the fourth quarter of 2020, the Company expects total net revenues to be between RMB3.65 billion to RMB3.75 billion, representing a decrease of 22.1% to 20.0% 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 Tuesday, December 1, 2020, at 8:00 a.m. U.S. Eastern Time (9:00 p.m. Beijing / Hong Kong Time on December 1, 2020).

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/1217808

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 8:00 a.m. U.S. Eastern Time, December 9, 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:

1217808

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 

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 interactions based on location, interests and a variety of recreational activities including live talent shows, short videos, social games as well as other video- and audio-based interactive experiences, such as live chats and mobile karaoke experience. Tantan, which was added into our family of applications through acquisition in May 2018, is a leading social and dating application for the younger generation. Tantan 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. 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 fourth quarter of 2020, 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 third quarter of 2020 are preliminary, unaudited and subject to audit adjustment. In addition, we may not meet our financial outlook for the fourth quarter of 2020 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 to Momo's business operations and the economy in China, the market price of Momo's stock prevailing from time to time, the nature of other investment opportunities presented to Momo from time to time, Momo'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

 

 


Momo Inc.

Unaudited Condensed Consolidated Statement of Operations

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




Three months


First nine months

ended September 30


ended  September  30


2019


2020


2020


2019


2020


2020



RMB


RMB


US$


RMB


RMB


US$


Net revenues:













Live video service

3,275,354


2,374,824


349,774


9,064,654


7,309,704


1,076,603


Value-added service

1,064,606


1,330,839


196,012


2,916,849


3,710,913


546,559


Mobile marketing

81,894


50,415


7,425


238,831


145,534


21,435


Mobile games

15,785


7,975


1,175


78,033


32,230


4,747


Other services

14,003


2,598


382


28,824


30,606


4,507


Total net revenues

4,451,642


3,766,651


554,768


12,327,191


11,228,987


1,653,851


Cost and expenses:













Cost of revenues

(2,203,350)


(2,020,779)


(297,629)


(6,140,787)


(5,934,000)


(873,984)


Research and development

(301,754)


(299,221)


(44,070)


(802,843)


(840,382)


(123,775)


Sales and marketing

(771,338)


(754,892)


(111,184)


(1,965,795)


(2,116,200)


(311,683)


General and administrative

(211,423)


(183,649)


(27,049)


(1,314,679)


(540,959)


(79,675)


Total cost and expenses

(3,487,865)


(3,258,541)


(479,932)


(10,224,104)


(9,431,541)


(1,389,117)


Other operating income

29,342


22,944


3,379


202,197


140,392


20,678


Income from operations

993,119


531,054


78,215


2,305,284


1,937,838


285,412


Interest income

105,384


104,232


15,352


299,337


343,591


50,605


Interest expense

(20,117)


(19,885)


(2,929)


(58,421)


(59,825)


(8,811)


Impairment loss on long-term
   investments

(11,211)


-


-


(15,711)


(6,000)


(884)


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

1,067,175


615,401


90,638


2,530,489


2,215,604


326,322


Income tax expenses

(182,578)


(143,615)


(21,152)


(630,097)


(750,139)


(110,484)


Income before share of
   income on equity method
   investments

884,597


471,786


69,486


1,900,392


1,465,465


215,838


Share of income (loss) on
   equity method investments

6,185


(15,763)


(2,322)


8,056


(16,203)


(2,386)


Net income

890,782


456,023


67,164


1,908,448


1,449,262


213,452


Less: net loss attributable to
   non-controlling interest

(3,115)


(705)


(104)


(6,543)


(2,772)


(408)


Net income attributable to
   the shareholders of
   Momo Inc.

893,897


456,728


67,268


1,914,991


1,452,034


213,860


 

Net income per share
   attributable to ordinary
   shareholders













Basic

2.15


1.09


0.16


4.62


3.48


0.51


Diluted

2.02


1.05


0.16


4.38


3.34


0.49


Weighted average shares
   used in calculating net
   income per ordinary share













Basic

415,615,139


417,884,266


417,884,266


414,790,186


417,580,609


417,580,609


Diluted

452,571,862


452,724,863


452,724,863


450,470,088


452,854,314


452,854,314

















 

 

Momo Inc.


Unaudited Condensed Consolidated Statement of Comprehensive Income


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

























Three months


First nine months


ended September 30


ended September 30



2019


2020


2020


2019


2020


2020


RMB


RMB


US$


RMB


RMB


US$

Net income

890,782


456,023


67,164


1,908,448


1,449,262


213,452

Other comprehensive income
   (loss), net of tax












Foreign currency translation
   adjustment

62,771


(80,618)


(11,874)


30,689


(72,667)


(10,703)

Comprehensive income

953,553


375,405


55,290


1,939,137


1,376,595


202,749

Less: comprehensive income
   (loss) attributed to the non-
   controlling interest

3,519


(9,953)


(1,466)


556


(16,945)


(2,496)

Comprehensive income
   attributable to Momo Inc.

950,034


385,358


56,756


1,938,581


1,393,540


205,245





















 

 


 

Momo Inc.

Unaudited Condensed Consolidated Balance Sheets

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








December 31


September 30


September 30


2019


2020


2020

RMB

RMB


US$

Assets






Current assets






Cash and cash equivalents

2,612,743


3,176,406


467,834

Short-term deposits

12,312,585


7,937,692


1,169,096

Accounts receivable, net of allowance for doubtful accounts of RMB12,209 and
   RMB17,621 as of December 31, 2019 and September 30, 2020, respectively

265,155


233,398


34,376

Amount due from a related party

4,382


-


-

Prepaid expenses and other current assets

599,000


738,502


108,769

Total current assets

15,793,865


12,085,998


1,780,075

Long-term deposits

300,000


4,650,000


684,871

Right-of-use assets, net

190,552


112,012


16,498

Property and equipment, net

346,345


305,420


44,983

Intangible assets

890,303


752,470


110,827

Rental deposits

25,028


24,922


3,671

Long-term investments

495,905


476,815


70,227

Other non-current assets

44,009


94,368


13,899

Deferred tax assets

37,064


34,031


5,012

Goodwill

4,360,610


4,253,297


626,443

Total assets

22,483,681


22,789,333


3,356,506

Liabilities and equity






Current liabilities






Accounts payable

714,323


634,249


93,415

Deferred revenue

503,461


487,234


71,761

Accrued expenses and other current liabilities

985,873


858,038


126,376

Amount due to related parties

29,606


31,868


4,694

Lease liabilities due within one year

135,169


92,500


13,624

Income tax payable

153,976


331,831


48,873

Deferred consideration in connection with business acquisitions

84,346


64,669


9,525

Total current liabilities

2,606,754


2,500,389


368,268

Deferred tax liabilities

222,576


188,118


27,707

Convertible senior notes

4,954,352


4,843,751


713,407

Share-based compensation liability

902,047


910,197


134,057

Lease liabilities

56,498


15,287


2,252

Other non-current liabilities

22,672


34,495


5,081

Total liabilities

8,764,899


8,492,237


1,250,772

Shareholder's equity (i)

13,718,782


14,297,096


2,105,734

Total liabilities and shareholder's equity

22,483,681


22,789,333


3,356,506







     (i): As of September 30, 2020, the number of ordinary shares outstanding was 415,801,407.

 

 


Momo Inc.

Unaudited Condensed Consolidated Statement of Cash Flows

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




Three months


First nine months



ended September 30


ended September 30



2019


2020


2020


2019


2020


2020



RMB


RMB


US$


RMB


RMB


US$


Cash flows from operating activities:













Net income

890,782


456,023


67,164


1,908,448


1,449,262


213,452


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













Depreciation of property and equipment

50,216


49,024


7,220


146,852


153,615


22,625


Amortization of intangible assets

40,100


39,347


5,795


117,715


119,517


17,603


Share-based compensation

165,163


168,475


24,814


1,240,774


521,102


76,751


Share of (income) loss on equity method investments

(6,185)


15,763


2,322


(8,056)


16,203


2,386


Impairment loss on long-term investments

11,211


-


-


15,711


6,000


884


Gain on subsidiary deconsolidation

-


-


-


-


(6,676)


(983)


Gain on disposal of property and equipment

(64)


(284)


(42)


(398)


(285)


(42)


Provision of allowance for doubtful accounts

2,900


26,006


3,830


12,209


26,412


3,890


Cash received on investment income distribution

-


-


-


-


1,153


170


Changes in operating assets and liabilities:













Accounts receivable

(103,290)


15,968


2,352


331,836


17,714


2,609


Prepaid expenses and other current assets

(24,378)


(207,586)


(30,574)


(23,182)


(163,753)


(24,118)


Amount due from a related party

(1,335)


2,029


299


(1,606)


4,382


645


Rental deposits

2,033


(83)


(12)


(362)


107


16


Deferred tax assets

(2,803)


561


83


23,304


3,034


447


Other non-current assets

(33,254)


9,930


1,463


(20,611)


28,181


4,151


Accounts payable

(133,863)


(62,189)


(9,159)


(45,775)


(78,664)


(11,586)


Income tax payable

(16,064)


112,799


16,613


(23,052)


177,855


26,195


Deferred revenue

84,711


17,442


2,569


54,789


(15,830)


(2,332)


Accrued expenses and other current liabilities

278,181


52,819


7,779


136,558


(161,411)


(23,773)


Amount due to related parties

(10,550)


13,495


1,988


(53,267)


2,262


333


Deferred tax liability

(10,025)


(9,837)


(1,449)


(35,322)


(29,880)


(4,401)


Other non-current liabilities

(7,556)


(8,648)


(1,274)


(2,762)


(28,500)


(4,198)


Net cash provided by operating activities

1,175,930


691,054


101,781


3,773,803


2,041,800


300,724


Cash flows from investing activities:













Purchase of property and equipment

(59,933)


(24,078)


(3,546)


(154,413)


(108,048)


(15,914)


Proceeds from disposal of property and equipment

294


457


67


804


474


70


Payment for long-term investments

(19,000)


-


-


(43,000)


(4,500)


(663)


Prepayment of long-term investments

-


-


-


(15,000)


-


-


Cash dividend received

-


-


-


-


233


34


Cash outflow due to subsidiary deconsolidation

-


-


-


-


(1,026)


(151)


Purchase of short-term deposits

(4,786,130)


(3,053,307)


(449,704)


(14,501,135)


(11,295,165)


(1,663,598)


Cash received on maturity of short-term deposits

4,785,400


4,337,085


638,784


12,650,430


15,622,659


2,300,969


Payment for short-term investments

(30,000)


-


-


(280,000)


(10,000)


(1,473)


Cash received from sales of short-term investment

80,000


-


-


240,000


10,000


1,473


Purchase of long-term deposits

-


(1,550,000)


(228,290)


-


(4,350,000)


(640,686)


Net cash used in investing activities

(29,369)


(289,843)


(42,689)


(2,102,314)


(135,373)


(19,939)


Cash flows from financing activities:













Deferred payment for business acquisition

(759)


-


-


(379,507)


(18,355)


(2,703)


Proceeds from exercise of share options

71


54


8


186


55


8


Deferred payment of purchase of property and
   equipment

(16,893)


-


-


(16,987)


-


-


Repurchase of ordinary shares

-


(132,407)


(19,501)


-


(132,407)


(19,501)


Repurchase of subsidiary's share options

-


(24,900)


(3,667)


-


(24,900)


(3,667)


Dividends payment

-


-


-


(877,346)


(1,123,983)


(165,545)


Net cash used in financing activities

(17,581)


(157,253)


(23,160)


(1,273,654)


(1,299,590)


(191,408)


Effect of exchange rate changes

6,200


(45,135)


(6,649)


5,054


(43,174)


(6,358)


Net increase in cash and cash equivalents

1,135,180


198,823


29,283


402,889


563,663


83,019


Cash and cash equivalents at the beginning of period

1,735,743


2,977,583


438,551


2,468,034


2,612,743


384,815


Cash and cash equivalents at the end of period

2,870,923


3,176,406


467,834


2,870,923


3,176,406


467,834


 

 


 

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 September 30, 2019

ended September 30, 2020


ended September 30, 2020



 

 

GAAP

RMB

Amortization
of intangible
assets from
business
acquisitions
RMB

Share-
based
compensation

RMB

Tax
impacts

(ii)
RMB

Non-GAAP

RMB


GAAP

RMB

Amortization
of intangible
assets from
business
acquisitions
RMB

Share-
based
compensation
RMB

Tax
impacts

(ii)

RMB

Non-GAAP

RMB


GAAP

US$

Amortization
of intangible
assets from
business
acquisitions

US$

Share-
based
compensation

US$

Tax
impacts

(ii)

US$

Non-GAAP

US$


Cost of revenues

(2,203,350)

18,751

6,738

-

(2,177,861)


(2,020,779)

18,472

4,434

-

(1,997,873)


(297,629)

2,721

653

-

(294,255)


Research and development

(301,754)

2,381

45,345

-

(254,028)


(299,221)

2,346

44,610

-

(252,265)


(44,070)

346

6,570

-

(37,154)


Sales and marketing

(771,338)

17,535

52,100

-

(701,703)


(754,892)

17,275

41,583

-

(696,034)


(111,184)

2,544

6,125

-

(102,515)


General and 
   administrative

(211,423)

-

60,980

-

(150,443)


(183,649)

-

77,848

-

(105,801)


(27,049)

-

11,466

-

(15,583)


Cost and operating
   expenses

(3,487,865)

38,667

165,163

-

(3,284,035)


(3,258,541)

38,093

168,475

-

(3,051,973)


(479,932)

5,611

24,814

-

(449,507)


Income from operations

993,119

38,667

165,163

-

1,196,949


531,054

38,093

168,475

-

737,622


78,215

5,611

24,814

-

108,640


Net income attributable to
   Momo Inc.

893,897

38,667

165,163

(9,667)

1,088,060


456,728

38,093

168,475

(9,523)

653,773


67,268

5,611

24,814

(1,403)

96,290
























































 

 

 

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.










First nine months


First nine months


First nine months


ended September 30, 2019

ended September 30, 2020


ended September 30, 2020



 

 

GAAP

RMB

Amortization of intangible assets from business acquisitions RMB

Share-
based compensation

RMB

Tax impacts

(ii)

RMB

Non-GAAP

RMB


GAAP

RMB

Amortization of intangible assets from business acquisitions RMB

Share-
based compensation

RMB

Tax impacts

(ii)

RMB

Non-GAAP

RMB


GAAP

US$

Amortization of intangible assets from business acquisitions

US$

Share-
based compensation

US$

Tax impacts

(ii)

US$

Non-GAAP

US$


Cost of revenues

(6,140,787)

54,999

16,371

-

(6,069,417)


(5,934,000)

56,046

14,207

-

(5,863,747)


(873,984)

8,255

2,092

-

(863,637)


Research and development

(802,843)

6,985

129,598

-

(666,260)


(840,382)

7,118

137,355

-

(695,909)


(123,775)

1,048

20,231

-

(102,496)


Sales and marketing

(1,965,795)

51,433

142,845

-

(1,771,517)


(2,116,200)

52,413

131,780

-

(1,932,007)


(311,683)

7,720

19,409

-

(284,554)


General and
   administrative

(1,314,679)

-

951,960

-

(362,719)


(540,959)

-

237,760

-

(303,199)


(79,675)

-

35,019

-

(44,656)


Cost and operating
   expenses

(10,224,104)

113,417

1,240,774

-

(8,869,913)


(9,431,541)

115,577

521,102

-

(8,794,862)


(1,389,117)

17,023

76,751

-

(1,295,343)


Income from operations

2,305,284

113,417

1,240,774

-

3,659,475


1,937,838

115,577

521,102

-

2,574,517


285,412

17,023

76,751

-

379,186


Net income
   attributable to
   Momo Inc.

1,914,991

113,417

1,240,774

(28,355)

3,240,827


1,452,034

115,577

521,102

(28,894)

2,059,819


213,860

17,023

76,751

(4,255)

303,379
























































(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  Condensed Segment Report

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




Three months

  ended September 30, 2020


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Net revenues:










Live video service

1,978,098


396,726


-


2,374,824


349,774

Value-added service

998,668


332,171


-


1,330,839


196,012

Mobile marketing

50,415


-


-


50,415


7,425

Mobile games

7,975


-


-


7,975


1,175

Other services

1,810


-


788


2,598


382

Total net revenues

3,036,966


728,897


788


3,766,651


554,768

Cost and expenses (iii):










Cost of revenues

(1,660,806)


(358,743)


(1,230)


(2,020,779)


(297,629)

Research and development

(214,597)


(84,624)


-


(299,221)


(44,070)

Sales and marketing

(361,448)


(393,437)


(7)


(754,892)


(111,184)

General and administrative

(164,331)


(13,620)


(5,698)


(183,649)


(27,049)

Total cost and expenses

(2,401,182)


(850,424)


(6,935)


(3,258,541)


(479,932)

Other operating income

22,893


-


51


22,944


3,379

Income (loss) from operations

658,677


(121,527)


(6,096)


531,054


78,215

Interest income

103,477


706


49


104,232


15,352

Interest expense

(19,885)


-


-


(19,885)


(2,929)

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

742,269


(120,821)


(6,047)


615,401


90,638

Income tax (expenses) benefits

(150,278)


6,663


-


(143,615)


(21,152)

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

591,991


(114,158)


(6,047)


471,786


69,486

Share of loss on equity method investments

(15,763)


-


-


(15,763)


(2,322)

Net income (loss)

576,228


(114,158)


(6,047)


456,023


67,164





















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












Three months


ended September 30, 2020


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Cost of revenues

3,338


1,096


-


4,434


653

Research and development

32,296


12,314


-


44,610


6,570

Sales and marketing

37,110


4,473


-


41,583


6,125

General and administrative

74,416


837


2,595


77,848


11,466

Total cost and expenses

147,160


18,720


2,595


168,475


24,814

 

 

 

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 September 30, 2020


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Operating income (loss)

658,677


(121,527)


(6,096)


531,054


78,215

Share-based compensation

147,160


18,720


2,595


168,475


24,814

Amortization of intangible assets from
   business acquisitions

-


38,093


-


38,093


5,611

Non-GAAP operating income (loss)

805,837


(64,714)


(3,501)


737,622


108,640











Net income (loss)

576,228


(114,158)


(6,047)


456,023


67,164

Share-based compensation

147,160


18,720


2,595


168,475


24,814

Amortization of intangible assets from
   business acquisitions

-


38,093


-


38,093


5,611

Tax impacts

-


(9,523)


-


(9,523)


(1,403)

Non-GAAP net income (loss)

723,388


(66,868)


(3,452)


653,068


96,186

 

 

 

Momo Inc.

Unaudited Condensed Segment Report

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




Three months

ended September 30, 2019


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$[1] 

Net revenues:










Live video service

3,275,354


-


-


3,275,354


458,239

Value-added service

754,629


309,977


-


1,064,606


148,944

Mobile marketing

81,894


-


-


81,894


11,457

Mobile games

15,785


-


-


15,785


2,208

Other services

11,234


-


2,769


14,003


1,960

Total net revenues

4,138,896


309,977


2,769


4,451,642


622,808

Cost and expenses (iv):










Cost of revenues

(2,101,678)


(99,722)


(1,950)


(2,203,350)


(308,260)

Research and development

(225,539)


(76,215)


-


(301,754)


(42,217)

Sales and marketing

(422,034)


(349,274)


(30)


(771,338)


(107,914)

General and administrative

(191,832)


(13,425)


(6,166)


(211,423)


(29,579)

Total cost and expenses

(2,941,083)


(538,636)


(8,146)


(3,487,865)


(487,970)

Other operating income

29,342


-


-


29,342


4,105

Income (loss) from operations

1,227,155


(228,659)


(5,377)


993,119


138,943

Interest income

102,749


2,594


41


105,384


14,744

Interest expense

(20,117)


-


-


(20,117)


(2,814)

Impairment loss on long-term investments

(11,211)


-


-


(11,211)


(1,568)

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

1,298,576


(226,065)


(5,336)


1,067,175


149,305

Income tax (expenses) benefits

(194,580)


12,002


-


(182,578)


(25,544)

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

1,103,996


(214,063)


(5,336)


884,597


123,761

Share of income on equity method
   investments

6,185


-


-


6,185


865

Net income (loss)

1,110,181


(214,063)


(5,336)


890,782


124,626





















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












Three months


ended September 30, 2019


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Cost of revenues

5,917


821


-


6,738


943

Research and development

27,375


17,970


-


45,345


6,344

Sales and marketing

46,831


5,269


-


52,100


7,289

General and administrative

56,860


1,486


2,634


60,980


8,531

Total cost and expenses

136,983


25,546


2,634


165,163


23,107





















[1] All translations from RMB to U.S. dollars are made at a rate of RMB 7.1477 to US$1.00, the effective noon buying rate for September 30, 2019 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 September 30, 2019


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Operating income (loss)

1,227,155


(228,659)


(5,377)


993,119


138,943

Share-based compensation

136,983


25,546


2,634


165,163


23,107

Amortization of intangible assets from
business acquisitions

-


38,667


-


38,667


5,409

Non-GAAP operating income (loss)

1,364,138


(164,446)


(2,743)


1,196,949


167,459











Net income (loss)

1,110,181


(214,063)


(5,336)


890,782


124,626

Share-based compensation

136,983


25,546


2,634


165,163


23,107

Amortization of intangible assets from
business acquisitions

-


38,667


-


38,667


5,409

Tax impacts

-


(9,667)


-


(9,667)


(1,352)

Non-GAAP net income (loss)

1,247,164


(159,517)


(2,702)


1,084,945


151,790

 

 

Momo Inc.

Unaudited Condensed Segment Report

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




First nine months

  ended  September  30, 2020


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Net revenues:










Live video service

6,715,266


594,438


-


7,309,704


1,076,603

Value-added service

2,677,575


1,033,338


-


3,710,913


546,559

Mobile marketing

145,534


-


-


145,534


21,435

Mobile games

32,230


-


-


32,230


4,747

Other services

9,168


-


21,438


30,606


4,507

Total net revenues

9,579,773


1,627,776


21,438


11,228,987


1,653,851

Cost and expenses (v):










Cost of revenues

(5,189,765)


(723,466)


(20,769)


(5,934,000)


(873,984)

Research and development

(601,271)


(239,111)


-


(840,382)


(123,775)

Sales and marketing

(1,093,008)


(1,023,151)


(41)


(2,116,200)


(311,683)

General and administrative

(461,627)


(61,128)


(18,204)


(540,959)


(79,675)

Total cost and expenses

(7,345,671)


(2,046,856)


(39,014)


(9,431,541)


(1,389,117)

Other operating income

140,202


-


190


140,392


20,678

Income (loss) from operations

2,374,304


(419,080)


(17,386)


1,937,838


285,412

Interest income

340,531


2,867


193


343,591


50,605

Interest expense

(59,825)


-


-


(59,825)


(8,811)

Impairment loss on long-term investments

(6,000)


-


-


(6,000)


(884)

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

2,649,010


(416,213)


(17,193)


2,215,604


326,322

Income tax (expenses) benefits

(762,768)


12,629


-


(750,139)


(110,484)

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

1,886,242


(403,584)


(17,193)


1,465,465


215,838

Share of loss on equity method investments

(16,203)


-


-


(16,203)


(2,386)

Net income (loss)

1,870,039


(403,584)


(17,193)


1,449,262


213,452











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












First nine months


ended September 30, 2020


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Cost of revenues

12,345


1,862


-


14,207


2,092

Research and development

95,768


41,587


-


137,355


20,231

Sales and marketing

121,456


10,324


-


131,780


19,409

General and administrative

207,650


22,238


7,872


237,760


35,019

Total cost and expenses

437,219


76,011


7,872


521,102


76,751

 

 

Momo Inc.

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

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












First nine months


ended September 30, 2020


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$