Release Date: August 28, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- JOYY Inc (YY, Financial) reported a year-over-year revenue increase of 3.3% to $565.1 million for Q2 2024.
- The company achieved a non-GAAP net profit of $74 million, up 10.2% quarter-over-quarter.
- Bigo Live's revenue increased by 7.7% year-over-year, marking the fourth consecutive quarter of top-line recovery.
- JOYY Inc (YY) repurchased $71.4 million worth of shares in Q2, demonstrating a commitment to shareholder returns.
- The company continues to generate robust cash flow, with $71.1 million in positive operating cash flow for the quarter.
Negative Points
- Despite revenue growth, the company's GAAP net income attributable to controlling interest dropped to $52.1 million from $155.1 million in the same period of 2023.
- Bigo's gross margin decreased year-over-year due to a higher contribution of network advertising revenue.
- General and administrative expenses increased to $40.7 million from $29 million in the same period of 2023, primarily due to impairment losses of equity investments.
- The company anticipates near-term fluctuations in Bigo's top-line due to adjustments in content costs and non-core audio live streaming products.
- The contribution of new monetization streams remains relatively small, indicating a need for further development to achieve significant impact.
Q & A Highlights
Q: Should we expect any changes in the company's strategy after the recent management change?
A: Ting Li, Chairman and CEO, emphasized that the strategic priorities will remain consistent. The company will continue to focus on globalization, strengthening its unique value proposition as a global social platform, improving operating efficiency, and exploring new revenue streams for sustainable long-term growth.
Q: Can management share the revenue trend for Bigo in the second half and across different geographies?
A: Alex, an unidentified corporate representative, noted that Bigo's live streaming revenue has maintained positive growth driven by paying users. Developed countries have consistently outperformed other regions. While some regions might see positive revenue growth sequentially, adjustments to Bigo's non-core audio live streaming products may cause short-term fluctuations. However, the company expects single-digit revenue growth for the full year.
Q: What is the margin trend for Bigo and the group in the second half?
A: Alex explained that Bigo's non-GAAP operating profit grew by 10.1% sequentially due to content cost optimization and reduced user acquisition spending. The margins are expected to remain stable or slightly increase. However, adjustments to Bigo's non-core audio live streaming products may modestly decline the absolute amount of Bigo's non-GAAP operating profit compared to last year.
Q: Could you provide an update on the share repurchase program and future capital return outlook?
A: Ting Li stated that the company repurchased $71.4 million worth of ADS in the second quarter, representing 3.9% of outstanding ADS. The Board has authorized an extension of the share repurchase program, allowing up to $400 million in repurchases until November 2025. The company remains committed to rewarding shareholders.
Q: Can management comment on the advertising business trend and outlook?
A: Ting Li highlighted that Bigo's advertising revenue increased by 34.7% year-over-year and 12.8% quarter-over-quarter. The advertising revenue now contributes 13.4% to Bigo's total revenue. The company expects continued sequential growth in advertising revenue in the second half, although it is still in the early stages of development.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
