08.12.2022, 13:23

Hello Group Inc. Announces Unaudited Financial Results for the Third Quarter of 2022

BEIJING, Dec. 8, 2022 /PRNewswire/ -- Hello Group Inc. (NASDAQ: MOMO) ("Hello Group" or the "Company"), a leading mobile social and entertainment platform in China, today announced its unaudited financial results for the third quarter of 2022.   

Third Quarter of 2022 Highlights

  • Net revenues decreased by 14.0% year over year to RMB3,233.0 million (US$454.5 million*) in the third quarter of 2022.
  • Net income attributable to Hello Group Inc. increased to RMB450.8 million (US$63.4 million) in the third quarter of 2022, from RMB403.2 million in the same period of 2021.
  • Non-GAAP net income attributable to Hello Group Inc. (note 1) decreased to RMB535.8 million (US$75.3 million) in the third quarter of 2022, from RMB571.6 million in the same period of 2021.
  • Diluted net income per American Depositary Share ("ADS") was RMB2.20 (US$0.31) in the third quarter of 2022, compared to RMB1.93 in the same period of 2021.
  • Non-GAAP diluted net income per ADS (note 1) was RMB2.60 (US$0.37) in the third quarter of 2022, compared to RMB2.70 in the same period of 2021.
  • Monthly Active Users ("MAU") on Momo application were 108.8 million in September 2022, compared to 115.5 million in September 2021. MAU on Tantan application were 20.9 million in September 2022.
  • For the Momo app total paying users was 8.4 million for the third quarter of 2022, compared to 9.3 million for the same period last year. Tantan had 2.0 million paying users for the third quarter of 2022 compared to 2.9 million from the year ago period.

* 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 RMB7.1135 to US$1.00, the effective noon buying rate for September 30, 2022 as set forth in the H.10 statistical release of the Federal Reserve Board.

First Nine Months of 2022 Highlights

  • Net revenues decreased 12.9% year over year to RMB9,491.5 million (US$1,334.3 million) for the first nine months of 2022.
  • Net income attributable to Hello Group Inc. was RMB1,086.3 million (US$152.7 million) for the first nine months of 2022, compared to RMB1,329.0 million during the same period of 2021.
  • Non-GAAP net income attributable to Hello Group Inc. (note 1) was RMB1,397.8 million (US$196.5 million) for the first nine months of 2022, compared to RMB1,756.2 million during the same period of 2021.
  • Diluted net income per ADS was RMB5.30 (US$0.75) for the first nine months of 2022, compared to RMB6.22 during the same period of 2021.
  • Non-GAAP diluted net income per ADS (note 1) was RMB6.75 (US$0.95) for the first nine months of 2022, compared to RMB8.14 during the same period of 2021.

"I am very happy to return to the CEO position. In the third quarter, thanks to product and operational enhancements, we delivered good financial results and made solid progress across all business lines." commented Yan Tang, Chairman and CEO of Hello Group. "Such progress on the business front, coupled with the efforts to improve cost efficiency, allowed us to see meaningful bottom line improvement on a sequential basis. I am very proud of the execution capabilities that the team demonstrated in such a challenging environment."

Third Quarter of 2022 Financial Results

Net revenues

Total net revenues were RMB3,233.0 million (US$454.5 million) in the third quarter of 2022, a decrease of 14.0% from RMB3,759.2 million in the third quarter of 2021.

Live video service revenues were RMB1,657.5 million (US$233.0 million) in the third quarter of 2022, a decrease of 23.5% from RMB2,166.7 million during the same period of 2021. The decrease was primarily attributable to COVID related consumption softness and regulatory changes, and to a lesser extent, Tantan's product adjustment to improve user experience in September last year and negative impact of pandemic resurgence and channel investment reduction.

Value-added service revenues mainly include virtual gift revenues and membership subscription revenues. Total value-added service revenues were RMB1,537.7 million (US$216.2 million) in the third quarter of 2022, an increase of 0.3% from RMB1,533.3 million during the same period of 2021. The year-over-year increase was primarily attributable to the rapid revenue growth from the new standalone apps. The increase was partially offset by the decrease in Tantan's value-added service due to the demonetization process to improve user experience and retention, as well as the negative impact of COVID and the reduction of channel investments on Tantan's user growth and paying conversion.

Mobile marketing revenues were RMB28.2 million (US$4.0 million) in the third quarter of 2022, a decrease of 34.8% from RMB43.3 million during the same period of 2021. The decrease in mobile marketing revenues was due to the negative impact of macro headwind on client's advertising budget.

Mobile games revenues were RMB7.7 million (US$1.1 million) in the third quarter of 2022, a decrease of 4.1% from RMB8.1 million in the third quarter of 2021. The decrease in mobile game revenues was mainly due to the decrease in paying users of mobile games.

Net revenues from the Momo segment decreased from RMB3,246.3 million in the third quarter of 2021 to RMB2,891.0 million (US$406.4 million) in the third quarter of 2022, primarily due to the decrease in net revenues from live video service. Net revenues from the Tantan segment decreased from RMB510.7 million in the third quarter of 2021 to RMB341.3 million (US$48.0 million) in the third quarter of 2022, due to our demonetization strategy to improve user experience, as well as the negative impact of COVID and the reduction of channel investments on Tantan's user growth and paying conversion.

Cost and expenses

Cost and expenses were RMB2,734.2 million (US$384.4 million) in the third quarter of 2022, a decrease of 17.6% from RMB3,319.9 million in the third quarter of 2021. The decrease was primarily attributable to: (a) a decrease in revenue sharing with broadcasters related to Momo's core live video service and Tantan's live video service, which was partially offset by an increase in revenue sharing with virtual gift recipients for our virtual gift service; (b) a decrease in sales and marketing expenses due to our initiatives to control cost and optimize Tantan's channel marketing strategy; (c) a decrease in salary expenses and share-based compensation expenses, due to our continuous optimization in personnel costs since the beginning of the year and the decreased fair value of the share options new grants; (d) no production cost from television program and film compared to the third quarter of 2021; and (e) a decrease in depreciation and amortization cost due to the impairment of intangible assets in 2021.

Non-GAAP cost and expenses (note 1) were RMB2,649.2 million (US$372.4 million) in the third quarter of 2022, a decrease of 15.7% from RMB3,143.2 million during the same period of 2021.

Income from operations

Income from operations was RMB520.1 million (US$73.1 million) in the third quarter of 2022, compared to RMB460.5 million during the same period of 2021. Income from operations of the Momo segment was RMB569.4 million (US$80.0 million) in the third quarter of 2022, which decreased from RMB676.5 million in the third quarter of 2021. Loss from operations of the Tantan segment was RMB44.5 million (US$6.2 million) in the third quarter of 2022, compared to loss from operations of RMB179.8 million in the third quarter of 2021.

Non-GAAP income from operations (note 1) was RMB605.1 million (US$85.1 million) in the third quarter of 2022, compared to RMB637.2 million during the same period of 2021. Non-GAAP income from operations of the Momo segment was RMB648.2 million (US$91.1 million) in the third quarter of 2022, which decreased from RMB786.3 million in the third quarter of 2021. Non-GAAP loss from operations of the Tantan segment was RMB38.3 million (US$5.4 million) in the third quarter of 2022, compared to non-GAAP loss from operations of RMB112.9 million in the third quarter of 2021.  

Other gain or loss, net

Other gain was RMB40.4 million (US$5.7 million) in the third quarter of 2022, which mainly resulted from the Company's repurchase of its convertible senior notes from certain bond holders in the third quarter of 2022, partially offset by impairment loss on other long-term investments.

Income tax expenses

Income tax expenses were RMB156.0 million (US$21.9 million) in the third quarter of 2022, compared to RMB143.2 million in the third quarter of 2021. The increase was primarily due to the fact that in the third quarter of 2022, we accrued withholding income tax of RMB42.9 million (US$6.0 million) on undistributed earnings generated in the third quarter of 2022 by our wholly-foreign owned enterprise ("WFOE"), because we plan to remit WFOE's earnings to its offshore parent company in the foreseeable future to fund its demand for US dollars in business operations, payments of dividends and debts, potential investments, share repurchase plan, etc.

Net income

Net income was RMB449.9 million (US$63.2 million) in the third quarter of 2022, compared to RMB395.9 million during the same period of 2021. Net income from the Momo segment was RMB499.6 million (US$70.2 million) in the third quarter of 2022, compared to RMB611.1 million in the same period of 2021. Net loss from the Tantan segment was RMB45.0 million (US$6.3 million) in the third quarter of 2022, compared to net loss of RMB179.0 million in the third quarter of 2021.

Non-GAAP net income (note 1) was RMB534.8 million (US$75.2 million) in the third quarter of 2022, compared to RMB564.3 million during the same period of 2021. Non-GAAP net income from the Momo segment was RMB578.4 million (US$81.3 million) in the third quarter of 2022, which decreased from RMB720.9 million in the third quarter of 2021. Non-GAAP net loss of the Tantan segment was RMB38.8 million (US$5.5 million) in the third quarter of 2022, compared to non-GAAP net loss of RMB120.5 million in the third quarter of 2021.

Net income attributable to Hello Group Inc.

Net income attributable to Hello Group Inc. was RMB450.8 million (US$63.4 million) in the third quarter of 2022, compared to a net income of RMB403.2 million during the same period of 2021.

Non-GAAP net income (note 1) attributable to Hello Group Inc. was RMB535.8 million (US$75.3 million) in the third quarter of 2022, compared to RMB571.6 million during the same period of 2021.

Net income per ADS

Diluted net income per ADS was RMB2.20 (US$0.31) in the third quarter of 2022, compared to RMB1.93 in the third quarter of 2021.

Non-GAAP diluted net income per ADS (note 1) was RMB2.60 (US$0.37) in the third quarter of 2022, compared to RMB2.70 in the third quarter of 2021.

Cash and cash flow

As of September 30, 2022, the Company's cash, cash equivalents, short-term deposits, long-term deposits, short-term restricted cash and long-term restricted cash totaled RMB13,021.3 million (US$1,830.5 million), compared to RMB15,707.0 million as of December 31, 2021. The decrease was due to a number of cash outflow items, including our cash dividend payment of RMB841.0 million (US$118.2 million) to shareholders; an aggregate payment of RMB2,137.0 million (US$300.4 million) for the repurchase of the company's convertible notes; an aggregate of RMB287.7 million (US$40.4 million) in relation to the share repurchase program; and RMB300.0 million (US$42.2 million) payment to Chinese tax authorities to repatriate cash from our WOFE in China to our offshore entity in the first nine months of 2022.

Net cash provided by operating activities in the third quarter of 2022 was RMB444.5 million (US$62.5 million), compared to RMB559.9 million in the third quarter of 2021.

First Nine Months of 2022 Financial Results

Net revenues for the first nine months of 2022 were RMB9,491.5 million (US$1,334.3 million), a decrease of 12.9% from RMB10,901.5 million in the same period of 2021.

Net income attributable to Hello Group Inc. was RMB1,086.3 million (US$152.7 million) for the first nine months of 2022, compared to RMB1,329.0 million during the same period of 2021.

Non-GAAP net income attributable to Hello Group Inc. (note 1) was RMB1,397.8 million (US$196.5 million) for the first nine months of 2022, compared to RMB1,756.2 million during the same period of 2021.

Diluted net income per ADS was RMB5.30 (US$0.75) during the first nine months of 2022, compared to RMB6.22 in the same period of 2021.

Non-GAAP diluted net income per ADS (note 1) was RMB6.75 (US$0.95) during the first nine months of 2022, compared to RMB8.14 in the same period of 2021.

Net cash provided by operating activities was RMB688.2 million (US$96.7 million) during the first nine months of 2022, compared to RMB893.7 million in the same period of 2021.

Recent Development

Execution of share repurchase program

On June 7, 2022, Hello Group's board of directors authorized a share repurchase program under which the Company may repurchase up to US$200 million of its shares over the next 24 months. As of December 8, 2022, the Company has repurchased 12.0 million ADSs for US$56.7 million on the open market under this program, at an average purchase price of US$4.71 per ADS.

Business Outlook

For the fourth quarter of 2022, the Company expects total net revenues to be between RMB3.15 billion to RMB3.25 billion, representing a decrease of 14.3% to 11.5% year-over-year. This forecast 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 resurgence on the Chinese and global economies, as well as on users' paying capabilities.

Note 1: Non-GAAP measures

To supplement our consolidated financial statements presented in accordance with U.S. generally accepted accounting principles ("GAAP"), we, Hello Group, use various non-GAAP financial measures that are adjusted from the most comparable GAAP results to exclude share-based compensation, impairment loss on goodwill and intangible assets, 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 (loss) attributable to Hello Group Inc., and diluted net income per ADS) is adjusted from the most comparable GAAP results to exclude share-based compensation, impairment loss on goodwill and intangible assets, 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, impairment loss on goodwill and intangible assets, 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 significant recurring expenses in our results of operations. We compensate for such limitation 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, December 8, 2022, at 8:00 a.m. U.S. Eastern Time (9:00 p.m. Beijing / Hong Kong Time on December 8, 2022).

Participants can register for the conference call by navigating to:

https://s1.c-conf.com/diamondpass/10027148-ghj92l.html. 

Upon registration, each participant will receive details for the conference call, including dial-in numbers, conference call passcode and a unique access PIN. Please dial in 10 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 December 15, 2022. The dial-in details for the replay are as follows:

U.S. / Canada: 1-855-883-1031
Hong Kong:      800-930-639
Passcode:        10027148

Additionally, a live and archived webcast of the conference call will be available on the Investor Relations section of Hello Group's website at https://ir.hellogroup.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. Tantan 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@hellogroup.com  

Christensen

In China
Mr. Eric Yuan
Phone: +86-10-5900-1548
E-mail: eric.yuan@christensencomms.com  

In U.S.

Ms. Linda Bergkamp
Phone: +1-480-614-3004
Email: linda.bergkamp@christensencomms.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 2022, 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 2022 are preliminary, unaudited and subject to audit adjustment. In addition, we may not meet our financial outlook for the fourth quarter of 2022 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 nine months

Ended September 30


Ended September 30


2021


2022


2022


2021


2022


2022


RMB


RMB


US$


RMB


RMB


US$

Net revenues:












Live video service

2,166,733


1,657,531


233,012


6,230,160


4,786,232


672,838

Value-added service

1,533,288


1,537,666


216,162


4,496,059


4,557,481


640,681

Mobile marketing

43,323


28,243


3,970


133,641


92,029


12,937

Mobile games

8,052


7,719


1,085


28,418


50,416


7,087

Other services

7,784


1,862


262


13,212


5,356


753

Total net revenues

3,759,180


3,233,021


454,491


10,901,490


9,491,514


1,334,296

Cost and expenses:












Cost of revenues

(2,183,337)


(1,886,135)


(265,149)


(6,191,911)


(5,505,369)


(773,933)

Research and development

(260,939)


(245,105)


(34,456)


(815,757)


(733,562)


(103,123)

Sales and marketing

(680,896)


(467,012)


(65,652)


(1,944,705)


(1,666,542)


(234,279)

General and administrative

(194,734)


(135,933)


(19,109)


(459,443)


(453,514)


(63,754)

Total cost and expenses

(3,319,906)


(2,734,185)


(384,366)


(9,411,816)


(8,358,987)


(1,175,089)

Other operating income

21,221


21,289


2,993


137,389


85,790


12,060

Income from operations

460,495


520,125


73,118


1,627,063


1,218,317


171,267

Interest income

93,564


89,274


12,550


284,706


280,761


39,469

Interest expense

(18,669)


(25,010)


(3,516)


(55,332)


(72,575)


(10,202)

Other gain or loss, net

-


40,403


5,680


(18,000)


118,325


16,634

Income before income tax and

share of income on equity method

investments

535,390


624,792


87,832


1,838,437


1,544,828


217,168

Income tax expenses

(143,158)


(156,041)


(21,936)


(526,065)


(452,860)


(63,662)

Income before share of income on

equity method investments

392,232


468,751


65,896


1,312,372


1,091,968


153,506

Share of income (loss) on equity

method investments

3,658


(18,880)


(2,654)


5,961


(8,967)


(1,261)

Net income 

395,890


449,871


63,242


1,318,333


1,083,001


152,245

Less: net loss attributable to non-

controlling interest

(7,301)


(964)


(136)


(10,677)


(3,288)


(462)

Net income attributable to the

shareholders of Hello Group Inc.

403,191


450,835


63,378


1,329,010


1,086,289


152,707













Net income per share attributable to

ordinary shareholders

Basic

1.01


1.15


0.16


3.26


2.75


0.39

Diluted

0.96


1.1


0.15


3.11


2.65


0.37

Weighted average shares used in

calculating net income per ordinary share












Basic

400,835,428


391,027,485


391,027,485


408,074,205


394,333,009


394,333,009

Diluted

437,639,164


423,608,050


423,608,050


444,906,615


429,765,849


429,765,849

 

 

 

Hello Group 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


2021


2022


2022


2021


2022


2022


RMB


RMB


US$


RMB


RMB


US$

Net income 

395,890


449,871


63,242


1,318,333


1,083,001


152,245

Other comprehensive income (loss), net of tax:












Foreign currency translation adjustment

368


(188,343)


(26,477)


(31,830)


(328,832)


(46,226)

Comprehensive income 

396,258


261,528


36,765


1,286,503


754,169


106,019

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

controlling interest

(7,540)


10,831


1,523


(13,323)


17,710


2,490

Comprehensive income attributable to Hello Group Inc.

403,798


250,697


35,242


1,299,826


736,459


103,529

 

 

 

Hello Group Inc.

Unaudited Condensed Consolidated Balance Sheets

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








December 31


September 30


September 30


2021


2022


2022

RMB

RMB


US$

Assets






Current assets






Cash and cash equivalents

5,570,563


3,435,616


482,971

Short-term deposits

2,860,000


5,900,000


829,409

Restricted cash

-


100,327


14,104

Accounts receivable, net of allowance for doubtful accounts of RMB15,127

and RMB5,945 as of December 31, 2021 and September 30, 2022,

respectively

205,225


194,344


27,320

Prepaid expenses and other current assets

775,072


877,348


123,336

Total current assets

9,410,860


10,507,635


1,477,140

Long-term deposits

7,200,000


3,500,000


492,022

Long-term restricted cash

76,471


85,362


12,000

Right-of-use assets, net

257,934


142,492


20,031

Property and equipment, net

180,664


186,949


26,281

Intangible assets, net

27,320


23,482


3,301

Rental deposits

19,204


20,737


2,915

Long-term investments

820,006


863,452


121,382

Other non-current assets

83,930


119,620


16,816

Deferred tax assets

34,849


35,836


5,038

Total assets

18,111,238


15,485,565


2,176,926

Liabilities and equity






Current liabilities






Accounts payable

726,207


622,980


87,576

Deferred revenue

539,967


467,763


65,757

Accrued expenses and other current liabilities

911,050


664,867


93,466

Amount due to related parties

5,016


9,443


1,327

Lease liabilities due within one year

162,950


102,585


14,421

Income tax payable

125,773


74,848


10,522

Deferred consideration in connection with business acquisitions

44,802


27,313


3,840

Convertible Senior Notes-current

-


2,726,763


383,322

Total current liabilities

2,515,765


4,696,562


660,231

Deferred tax liabilities

213,384


37,635


5,291

Convertible senior notes

4,565,292


-


-

Lease liabilities

103,105


42,578


5,986

Other non-current liabilities

128,095


114,577


16,107

Total liabilities

7,525,641


4,891,352


687,615

Shareholder's equity (i)

10,585,597


10,594,213


1,489,311

Total liabilities and shareholder's equity

18,111,238


15,485,565


2,176,926













(i): As of September 30, 2022, the number of ordinary shares outstanding was 385,309,239.





 

 

 

Hello Group 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


2021


2022


2022


2021


2022


2022


RMB


RMB


US$


RMB


RMB


US$

Cash flows from operating activities:












Net income 

395,890


449,871


63,242


1,318,333


1,083,001


152,245

Adjustments to reconcile net income to net cash provided by

operating activities:












Depreciation of property and equipment

38,696


27,047


3,802


121,311


83,107


11,683

Amortization of intangible assets

34,722


1,279


180


107,783


3,837


539

Share-based compensation

143,280


84,976


11,945


349,195


311,540


43,797

Share of income (loss) on equity method investments

(3,658)


18,880


2,654


(5,961)


8,967


1,261

Gain on repurchase of convertible senior notes

-


(51,653)


(7,261)


-


(129,575)


(18,215)

Loss on long-term investments

-


11,250


1,581


18,000


11,250


1,581

Gain on disposal of subsidiaries

-


-


-


(15,526)


-


-

Cash received on distributions from equity method investments

-


-


-


-


1,708


240

Loss or gain on disposal of property and equipment

2,351


(923)


(130)


1,272


(783)


(110)

Provision of losses on receivable and other assets

(322)


(820)


(115)


242


(453)


(64)

Changes in operating assets and liabilities:












Accounts receivable

(1,616)


22,973


3,229


(24,358)


15,695


2,206

Prepaid expenses and other current assets

(85,048)


41,418


5,822


(203,666)


(16,144)


(2,269)

Rental deposits

(922)


716


101


(1,514)


1,399


197

Deferred tax assets

(782)


590


83


(2,016)


(986)


(139)

Other non-current assets

(57,100)


16,130


2,268


(8,050)


76,820


10,799

Accounts payable

(28,400)


(438)


(62)


19,422


(106,392)


(14,956)

Income tax payable

24,947


(15,635)


(2,198)


(71,431)


(50,923)


(7,159)

Deferred revenue

9,369


(19,356)


(2,721)


25,454


(73,891)


(10,387)

Accrued expenses and other current liabilities

56,954


(108,513)


(15,255)


(38,829)


(304,346)


(42,784)

Amount due to related parties

1,860


7,824


1,100


(4,696)


4,427


622

Deferred tax liabilities

(8,676)


(14,425)


(2,028)


(26,941)


(171,752)


(24,145)

Share-based compensation liability

-


-


-


(678,153)


-


-

Other non-current liabilities

38,335


(26,655)


(3,747)


13,818


(58,311)


(8,197)

Net cash provided by operating activities

559,880


444,536


62,490


893,689


688,195


96,745

Cash flows from investing activities:












Purchase of property and equipment

(30,919)


(27,051)


(3,803)


(76,122)


(70,392)


(9,896)

Payment for long-term investments

-


-


-


(300,000)


(55,343)


(7,780)

Purchase of short-term deposits

(2,100,000)


(1,700,000)


(238,982)


(4,576,688)


(1,700,000)


(238,982)

Cash received on maturity of short-term deposits

3,458,658


2,700,000


379,560


6,117,570


3,710,000


521,544

Cash received on investment income distribution

-


-


-


5,610


3,523


495

Cash of disposed subsidiaries

-


-


-


(8,750)


-


-

Purchase of long-term deposits

-


(1,000,000)


(140,578)


(250,000)


(2,550,000)


(358,473)

Cash received on maturity of long-term deposits

-


-


-


-


1,200,000


168,693

Other investing activities

13


2,781


391


2,406


3,103


436

Net cash provided by (used in) investing activities

1,327,752


(24,270)


(3,412)


914,026


540,891


76,037

Cash flows from financing activities:












Deferred payment for business acquisition

-


(15,858)


(2,229)


(12,907)


(21,421)


(3,011)

Proceeds from exercise of share options

461


18


3


771


51


7

Payment in relation to the share repurchase program

(756,714)


(285,355)


(40,115)


(862,865)


(287,690)


(40,443)

Repurchase of subsidiary's share options

(48,489)


(14,330)


(2,014)


(54,050)


(39,867)


(5,604)

Dividends payment

-


-


-


(852,743)


(840,997)


(118,225)

Payment for redemption of convertible bonds

-


(1,024,443)


(144,014)


-


(2,136,987)


(300,413)

Net cash used in financing activities

(804,742)


(1,339,968)


(188,369)


(1,781,794)


(3,326,911)


(467,689)

Effect of exchange rate changes

(3,661)


(6,190)


(869)


(28,697)


72,096


10,135

Net increase (decrease) in cash and cash equivalents 

1,079,229


(925,892)


(130,160)


(2,776)


(2,025,729)


(284,772)

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

2,284,067


4,547,197


639,235


3,366,072


5,647,034


793,847

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

3,363,296


3,621,305


509,075


3,363,296


3,621,305


509,075

 

 

 

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, 2021

Ended September 30, 2022


Ended September 30, 2022


GAAP

Amortization of

intangible assets

from business

acquisitions 

Share-based

compensation

Tax

impacts

Non-GAAP


GAAP

Share-based

compensation

Non-GAAP


GAAP

Share-based

compensation

Non-GAAP




(ii)








RMB

RMB

RMB

RMB

RMB

RMB

RMB

RMB

US$

US$

US$

Cost of revenues

(2,183,337)

17,286

6,623

-

(2,159,428)


(1,886,135)

1,496

(1,884,639)


(265,149)

210

(264,939)

Research and development

(260,939)

-

29,094

-

(231,845)


(245,105)

21,713

(223,392)


(34,456)

3,052

(31,404)

Sales and marketing

(680,896)

16,165

27,653

-

(637,078)


(467,012)

8,453

(458,559)


(65,652)

1,188

(64,464)

General and administrative

(194,734)

-

79,910

-

(114,824)


(135,933)

53,314

(82,619)


(19,109)

7,495

(11,614)

Cost and operating expenses

(3,319,906)

33,451

143,280

-

(3,143,175)


(2,734,185)

84,976

(2,649,209)


(384,366)

11,945

(372,421)

Income from operations

460,495

33,451

143,280

-

637,226


520,125

84,976

605,101


73,118

11,945

85,063

Net income attributable to Hello

Group Inc.

403,191

33,451

143,280

(8,363)

571,559


450,835

84,976

535,811


63,378

11,945

75,323

 

 

 

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 nine months


First nine months


First nine months

Ended September 30, 2021

Ended September 30, 2022


Ended September 30, 2022


GAAP

Amortization of

intangible assets

from business

acquisitions 

Share-based

compensation

Tax

impacts

Non-GAAP


GAAP

Share-based

compensation

Non-GAAP


GAAP

Share-based

compensation

Non-GAAP




(ii)








RMB

RMB

RMB

RMB

RMB

RMB

RMB

RMB

US$

US$

US$

Cost of revenues

(6,191,911)

51,853

14,548

-

(6,125,510)


(5,505,369)

12,488

(5,492,881)


(773,933)

1,756

(772,177)

Research and development

(815,757)

3,660

103,268

-

(708,829)


(733,562)

66,652

(666,910)


(103,123)

9,370

(93,753)

Sales and marketing

(1,944,705)

48,491

59,797

-

(1,836,417)


(1,666,542)

29,952

(1,636,590)


(234,279)

4,211

(230,068)

General and administrative

(459,443)

-

171,582

-

(287,861)


(453,514)

202,448

(251,066)


(63,754)

28,460

(35,294)

Cost and operating expenses

(9,411,816)

104,004

349,195

-

(8,958,617)


(8,358,987)

311,540

(8,047,447)


(1,175,089)

43,797

(1,131,292)

Income from operations

1,627,063

104,004

349,195

-

2,080,262


1,218,317

311,540

1,529,857


171,267

43,797

215,064

Net income attributable to

Hello Group Inc.

1,329,010

104,004

349,195

(26,002)

1,756,207


1,086,289

311,540

1,397,829


152,707

43,797

196,504

































(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 September 30, 2022


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Net revenues:










Live video service

1,517,872


139,659


-


1,657,531


233,012

Value-added service

1,336,050


201,616


-


1,537,666


216,162

Mobile marketing

28,243


-


-


28,243


3,970

Mobile games

7,719


-


-


7,719


1,085

Other services

1,126


-


736


1,862


262

Total net revenues

2,891,010


341,275


736


3,233,021


454,491

Cost and expenses (iii):










Cost of revenues

(1,704,934)


(180,277)


(924)


(1,886,135)


(265,149)

Research and development

(176,727)


(68,378)


-


(245,105)


(34,456)

Sales and marketing

(335,350)


(130,222)


(1,440)


(467,012)


(65,652)

General and administrative

(124,184)


(8,574)


(3,175)


(135,933)


(19,109)

Total cost and expenses

(2,341,195)


(387,451)


(5,539)


(2,734,185)


(384,366)

Other operating income

19,563


1,722


4


21,289


2,993

Income (loss) from operations

569,378


(44,454)


(4,799)


520,125


73,118

Interest income

89,003


187


84


89,274


12,550

Interest expense

(25,010)


-


-


(25,010)


(3,516)

Other gain or loss, net

40,403


-


-


40,403


5,680

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

method investments

673,774


(44,267)


(4,715)


624,792


87,832

Income tax expenses

(155,328)


(713)


-


(156,041)


(21,936)

Income (loss) before share of income on equity method

investments

518,446


(44,980)


(4,715)


468,751


65,896

Share of loss on equity method investments

(18,880)


-


-


(18,880)


(2,654)

Net income (loss)

499,566


(44,980)


(4,715)


449,871


63,242





















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




























Three months


Ended September 30, 2022


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Cost of revenues

1,478


18


-


1,496


210

Research and development

15,640


6,073


-


21,713


3,052

Sales and marketing

8,446


7


-


8,453


1,188

General and administrative

53,272


42


-


53,314


7,495

Total cost and expenses

78,836


6,140


-


84,976


11,945

 

 

 

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 September 30, 2022


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Income (loss) from operations

569,378


(44,454)


(4,799)


520,125


73,118

Share-based compensation

78,836


6,140


-


84,976


11,945

Non-GAAP income (loss) from operations

648,214


(38,314)


(4,799)


605,101


85,063











Net income (loss)

499,566


(44,980)


(4,715)


449,871


63,242

Share-based compensation

78,836


6,140


-


84,976


11,945

Non-GAAP net income (loss)

578,402


(38,840)


(4,715)


534,847


75,187

 

 

 

Hello Group Inc.

Unaudited Condensed Segment Report

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


Three months

Ended September 30, 2021


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$[1]

Net revenues:










Live video service

1,932,141


234,592


-


2,166,733


336,272

Value-added service

1,257,158


276,130


-


1,533,288


237,962

Mobile marketing

43,323


-


-


43,323


6,724

Mobile games

8,052


-


-


8,052


1,250

Other services

5,589


-


2,195


7,784


1,208

Total net revenues

3,246,263


510,722


2,195


3,759,180


583,416

Cost and expenses (iv):










Cost of revenues

(1,884,931)


(269,376)


(29,030)


(2,183,337)


(338,849)

Research and development

(194,475)


(66,464)


-


(260,939)


(40,497)

Sales and marketing

(336,691)


(341,636)


(2,569)


(680,896)


(105,673)

General and administrative

(171,609)


(16,321)


(6,804)


(194,734)


(30,222)

Total cost and expenses

(2,587,706)


(693,797)


(38,403)


(3,319,906)


(515,241)

Other operating income

17,946


3,270


5


21,221


3,293

Income (loss) from operations

676,503


(179,805)


(36,203)


460,495


71,468

Interest income

93,174


356


34


93,564


14,521

Interest expense

(18,669)


-


-


(18,669)


(2,897)

Income (loss) before income tax and share of income on

equity method investments

751,008


(179,449)


(36,169)


535,390


83,092

Income tax (expenses) benefits

(143,562)


404


-


(143,158)


(22,218)

Income (loss) before share of income on equity method

investments

607,446


(179,045)


(36,169)


392,232


60,874

Share of income on equity method investments

3,658


-


-


3,658


568

Net income (loss)

611,104


(179,045)


(36,169)


395,890


61,442





















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
















Three months


Ended September 30, 2021


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Cost of revenues

2,847


3,776


-


6,623


1,028

Research and development

18,071


11,023


-


29,094


4,515

Sales and marketing

11,280


16,373


-


27,653


4,292

General and administrative

77,616


2,294


-


79,910


12,402

Total cost and expenses

109,814


33,466


-


143,280


22,237











[1] All translations from RMB to U.S. dollars are made at a rate of RMB6.4434 to US$1.00, the effective noon buying rate for September 30, 2021 as 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 September 30, 2021


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Income (loss) from operations

676,503


(179,805)


(36,203)


460,495


71,468

Share-based compensation

109,814


33,466


-


143,280


22,237

Amortization of intangible assets from

business acquisitions

-


33,451


-


33,451


5,192

Non-GAAP income (loss) from operations

786,317


(112,888)


(36,203)


637,226


98,897











Net income (loss)

611,104


(179,045)


(36,169)


395,890


61,442

Share-based compensation

109,814


33,466


-


143,280


22,237

Amortization of intangible assets from

business acquisitions

-


33,451


-


33,451


5,192

Tax impacts

-


(8,363)


-


(8,363)


(1,298)

Non-GAAP net income (loss)

720,918


(120,491)


(36,169)


564,258


87,573

 

 

 

Hello Group Inc.

Unaudited Condensed Segment Report

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


First nine months

Ended September 30, 2022


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Net revenues:










Live video service

4,404,991


381,241


-


4,786,232


672,838

Value-added service

3,917,609


639,872


-


4,557,481


640,681

Mobile marketing

92,029


-


-


92,029


12,937

Mobile games

50,416


-


-


50,416


7,087

Other services

4,298


-


1,058


5,356


753

Total net revenues

8,469,343


1,021,113


1,058


9,491,514


1,334,296

Cost and expenses (v):










Cost of revenues

(4,981,345)


(522,188)


(1,836)


(5,505,369)


(773,933)

Research and development

(536,640)


(196,922)


-


(733,562)


(103,123)

Sales and marketing

(1,039,526)


(623,680)


(3,336)


(1,666,542)


(234,279)

General and administrative

(415,954)


(25,335)


(12,225)


(453,514)


(63,754)

Total cost and expenses

(6,973,465)


(1,368,125)


(17,397)


(8,358,987)


(1,175,089)

Other operating income

76,253


9,491


46


85,790


12,060

Income (loss) from operations

1,572,131


(337,521)


(16,293)


1,218,317


171,267

Interest income

280,252


291


218


280,761


39,469

Interest expense

(72,575)


-


-


(72,575)


(10,202)

Other gain or loss, net

118,325


-


-


118,325


16,634

Income (loss) before income tax and share

of income on equity method investments

1,898,133


(337,230)


(16,075)


1,544,828


217,168

Income tax expenses

(451,061)


(1,799)


-


(452,860)


(63,662)

Income (loss) before share of income on

equity method investments

1,447,072


(339,029)


(16,075)


1,091,968


153,506

Share of loss on equity method investments

(8,967)


-


-


(8,967)


(1,261)

Net income (loss)

1,438,105


(339,029)


(16,075)


1,083,001


152,245





















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
























First nine months


Ended September 30, 2022


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Cost of revenues

5,477


7,011


-


12,488


1,756

Research and development

51,752


14,900


-


66,652


9,370

Sales and marketing

29,729


223


-


29,952


4,211

General and administrative

202,319


129


-


202,448


28,460

Total cost and expenses

289,277


22,263


-


311,540


43,797

 

 

 

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 nine months


ended September 30, 2022


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Operating income (loss)

1,572,131


(337,521)


(16,293)


1,218,317


171,267

Share-based compensation

289,277


22,263


-


311,540


43,797

Non-GAAP operating income

(loss)

1,861,408


(315,258)


(16,293)


1,529,857


215,064











Net income (loss)

1,438,105


(339,029)


(16,075)


1,083,001


152,245

Share-based compensation

289,277


22,263


-


311,540


43,797

Non-GAAP net income (loss)

1,727,382


(316,766)


(16,075)


1,394,541


196,042

 

 

 

Hello Group Inc.

Unaudited Condensed Segment Report

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


First nine months

Ended September 30, 2021


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Net revenues:










Live video service

5,527,851


702,309


-


6,230,160


966,906

Value-added service

3,606,393


889,666


-


4,496,059


697,777

Mobile marketing

133,641


-


-


133,641


20,741

Mobile games

28,418


-


-


28,418


4,410

Other services

9,263


-


3,949


13,212


2,051

Total net revenues

9,305,566


1,591,975


3,949


10,901,490


1,691,885

Cost and expenses (vi):










Cost of revenues

(5,338,330)


(816,562)


(37,019)


(6,191,911)


(960,970)

Research and development

(595,176)


(220,581)


-


(815,757)


(126,604)

Sales and marketing

(1,042,458)


(898,612)


(3,635)


(1,944,705)


(301,813)

General and administrative

(471,965)


28,763


(16,241)


(459,443)


(71,304)

Total cost and expenses

(7,447,929)


(1,906,992)


(56,895)


(9,411,816)


(1,460,691)

Other operating income

103,352


34,006


31


137,389


21,322

Income (loss) from operations

1,960,989


(281,011)


(52,915)


1,627,063


252,516

Interest income

283,629


952


125


284,706


44,186

Interest expense

(55,332)


-


-


(55,332)


(8,587)

Other gain or loss, net

(18,000)


-


-


(18,000)


(2,794)

Income (loss) before income tax and share of

income on equity method investments

2,171,286


(280,059)


(52,790)


1,838,437


285,321

Income tax (expenses) benefits

(533,508)


7,443


-


(526,065)


(81,644)

Income (loss) before share of income on

equity method investments

1,637,778


(272,616)


(52,790)


1,312,372


203,677

Share of income on equity method investments

5,961


-


-


5,961


925

Net income (loss)

1,643,739


(272,616)


(52,790)


1,318,333


204,602





















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














First nine months


ended September 30, 2021


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Cost of revenues

7,812


6,736


-


14,548


2,258

Research and development

78,259


25,009


-


103,268


16,027

Sales and marketing

37,157


22,640


-


59,797


9,280

General and administrative

238,408


(66,826)


-


171,582


26,629

Total cost and expenses

361,636


(12,441)


-


349,195


54,194

 

 

 

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 nine months


ended September 30, 2021


Momo


Tantan


QOOL


Total


Total


RMB


RMB


RMB


RMB


US$

Operating income (loss)

1,960,989


(281,011)


(52,915)


1,627,063


252,516

Share-based compensation

361,636


(12,441)


-


349,195


54,194

Amortization of intangible assets

from business acquisitions

-


104,004


-


104,004


16,141

Non-GAAP operating income (loss)

2,322,625


(189,448)


(52,915)


2,080,262


322,851











Net income (loss)

1,643,739


(272,616)


(52,790)


1,318,333


204,602

Share-based compensation

361,636


(12,441)


-


349,195


54,194

Amortization of intangible assets

from business acquisitions

-


104,004


-


104,004


16,141

Tax impacts

-


(26,002)


-


(26,002)


(4,035)

Non-GAAP net income (loss)

2,005,375


(207,055)


(52,790)


1,745,530


270,902

 

View original content:https://www.prnewswire.com/news-releases/hello-group-inc-announces-unaudited-financial-results-for-the-third-quarter-of-2022-301697932.html


Source: Hello Group Inc. Related Stocks: NASDAQ:MOMO