MOMO

Interested in Hello Group Inc. Sponsored ADR? Here are five stocks we like better. Second-quarter revenue fell 5% year over year to RMB2.49 billion, while non-GAAP net income recovered to RMB273.9 million from a loss a year earlier. Profitability weakened, with the adjusted operating margin declining to 11.1%. Domestic revenue dropped 17% amid tax scrutiny affecting agencies and broadcasters and reduced spending by high-value livestreaming users. Tantan’s revenue also declined, though its user base stabilized and the company is adding payment options and AI-powered features. Overseas revenue surged 52% to RMB673 million, reaching 27% of total revenue, led by newer Middle East and North Africa products. Hello Group lowered its outlook, now expecting full-year revenue to decline at a mid-single-digit rate and acknowledging its RMB3 billion overseas revenue target may be missed. Hello Group Stock is Attractive Value Speculators Hello Group (NASDAQ:MOMO) reported second-quarter 2026 revenue of RMB2.49 billion, down 5% from a year earlier but up 4% sequentially, as growth in overseas operations partly offset continued pressure in its domestic business. Non-GAAP net income attributable to shareholders totaled RMB273.9 million, compared with a RMB96 million loss in the prior-year period and RMB328.8 million in the first quarter. Non-GAAP operating income was RMB276.1 million, producing an 11.1% operating margin, down from RMB447.7 million and a 17.1% margin a year earlier. → Boarding Call: EHang Secures First-Mover Altitude MOMO Is Not Getting Love From Investors Chief Operating Officer Jianhua Wen said domestic revenue was RMB1.81 billion, down 17% year over year and up 1% from the prior quarter. Momo’s revenue was RMB1.54 billion, declining 16% year over year but increasing 2% sequentially. The company attributed the domestic decline primarily to ongoing tax scrutiny affecting Momo agencies and broadcasters, along with weaker consumer spending amid macroeconomic pressure. Wen said some audio-scenario agencies reduced operations beginning in April because of tax-related pressures. Hello Group introduced targeted subsidies in late May, which it said supported a recovery in revenue. → Medtronic’s Stars Are Aligning for a Price Recovery Chief Executive Officer Tang Yan said the company revised its domestic outlook after seeing a more pronounced reduction in spending among Momo’s highest-spending livestreaming users. He said these users generally remain active on the platform but have become more cautious in their spending, leading to a significant decline in average revenue per paying user. “The weakness we are seeing in revenue is not primarily a function of users leaving the platforms or a deterioration in engagement,” Chief Financial Officer Peng Hui said. “It is much more concentrated in the spending behavior of the highest net worth users.” → Dutch Bros Sell-Off Creates a Growth Opportunity Momo’s audio and video small-ticket scenarios added 200,000 paying users sequentially, bringing the total to 3.9 million, helped by themed World Cup and seasonal events. The company also cited product initiatives including AI-generated custom gifts, match-prediction games and testing of a paid “Moments Boost” feature for increasing post exposure. Hello Group said it will pursue a tiered approach for domestic users. For high-value users, it plans to emphasize social interaction features, offline events and VIP services, while supplying top broadcasters with resources such as overseas training tours and short-drama production. For mid-tier and long-tail users, the company plans to focus on lower-barrier offerings including audio interactions and social mini-games. Tantan generated RMB156 million in second-quarter revenue, down 18% year over year and 3% from the prior quarter. Paying users totaled 500,000 at quarter-end, down 40,000 sequentially, largely because Alipay adjusted its auto-renewal deduction rules, according to management. However, the company said Tantan’s average domestic user base was stable with a slight increase during the quarter, marking its first user-base stabilization since marketing spending was reduced in early 2022. Refined targeting strategies improved matching efficiency and retention among male and female users, Wen said. Tantan continued to deploy artificial intelligence tools, including AI icebreakers, chat assistance, curated matching and profile optimization. The company said AI tools that analyze photo content to generate personalized opening messages showed a particularly strong benefit for female-user retention. To address membership renewal pressure, Tantan launched a lifetime membership option, encouraged shorter-cycle subscribers to shift to longer-term plans, and added Douyin Pay and WeChat Pay to reduce reliance on a single payment channel. Overseas revenue rose 52% year over year and 13% sequentially to RMB673 million, accounting for 27% of total revenue, compared with 17% a year earlier. Overseas value-added-services revenue was RMB664.9 million, up 51% from a year earlier. The growth was driven by newer Middle East and North Africa products, seasonal recovery following Ramadan, and the contribution from overseas dating businesses acquired last year. Wen said the company’s two newer MENA products, YahalaLand and Amar, were approaching the revenue scale of SoulChill during the second quarter. Tang said the combined revenue of Yahala and Amar had surpassed SoulChill in the third quarter to date. YahalaLand reached net-income breakeven for the first time in the second quarter, while Amar’s loss narrowed as revenue grew. Management said it expects both products to contribute to group profit next year. SoulChill continued to recover from its first-quarter low, though its performance remained below the company’s original expectations after its removal from Turkey’s App Store and geopolitical tensions in the Middle East. Meanwhile, dating app happn increased conversion and average revenue per user through membership and targeting changes, and began expansion efforts in markets including Korea, Taiwan and the U.K. Hello Group forecast third-quarter revenue of RMB2.4 billion to RMB2.5 billion, representing a year-over-year decline of 9.4% to 5.7%. At the midpoint, the company expects mainland China revenue to decline by a high-teens percentage rate and overseas revenue to grow by a high-thirties percentage rate. Peng said the company’s previous RMB3 billion overseas revenue target for 2026 appeared “a little bit of a stretch,” and indicated a result potentially RMB100 million to RMB200 million below that goal. The company now expects full-year group revenue to decline by a mid-single-digit percentage rate, rather than decline only slightly as previously anticipated. Second-quarter non-GAAP gross margin was 35.8%, compared with 38.8% a year earlier. The company recorded RMB56.8 million in film production expenses during the quarter; excluding that item, gross margin would have been 38.1%. Hello Group said payment-channel costs rose as its international revenue mix expanded, though improved MENA margins and a greater contribution from higher-margin overseas dating businesses helped offset pressure. Management said it will seek additional efficiencies in personnel, sales and marketing costs, particularly in domestic operations. Despite the more challenging revenue environment and film-related losses, Peng said the company still believes its low-teens adjusted operating-margin target for 2026 remains achievable if it executes on cost controls and operating-efficiency initiatives. Hello Group Inc (NASDAQ: MOMO) is a China-based technology company specializing in mobile social networking and interactive entertainment. Its flagship product, the Momo app, offers location-based social discovery services that enable users to find and connect with new friends based on shared interests and geographic proximity. The platform integrates instant messaging, group chat, and content-sharing features, while also providing premium subscriptions and in-app purchases such as virtual gifts and sticker packs. In addition to Momo, Hello Group's portfolio includes Tantan, a dating-focused social app designed to help users build meaningful relationships through profile matching and interest-driven swiping. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Hello Group Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for September 2026.

BEIJING, Sept. 3, 2026 /PRNewswire/ -- Hello Group Inc. (NASDAQ: MOMO) ("Hello Group" or the "Company"), a leading player in Asia's online social networking space, today announced its unaudited financial results for the second quarter of 2026. Second Quarter of 2026 Highlights Net revenues decreased by 5.1% year over year to RMB2,486.0 million (US$366.4 million*) in the second quarter of 2026. Net revenues from overseas increased by 52.0% year over year to RMB672.7 million (US$99.1 million) in the second quarter of 2026. Net income attributable to the shareholders of Hello Group Inc. was RMB237.4 million (US$35.0 million) in the second quarter of 2026, compared to a net loss of RMB140.2 million in the same period of 2025. Non-GAAP net income attributable to the shareholders of Hello Group Inc. (note 1) was RMB273.9 million (US$40.4 million) in the second quarter of 2026, compared to a net loss of RMB96.0 million in the same period of 2025. In the second quarter of 2025, the Company accrued an additional withholding tax of RMB547.9 million related to dividends paid or payable by its wholly foreign-owned enterprise ("WFOE") in Chinese mainland to its offshore parent company in Hong Kong, Momo Hong Kong. Diluted net income per American Depositary Share ("ADS") was RMB1.52 (US$0.22) in the second quarter of 2026, compared to a diluted net loss per ADS of RMB0.84 in the same period of 2025. Non-GAAP diluted net income per ADS (note 1) was RMB1.75 (US$0.26) in the second quarter of 2026, compared to a diluted net loss per ADS of RMB0.58 in the same period of 2025. For Momo app, total paying users were 3.9 million for the second quarter of 2026, compared to 3.5 million for the same period last year, and 3.7 million for the previous quarter. Tantan had 0.5 million paying users for the second quarter of 2026 compared to 0.7 million for the same period last year and 0.6 million for the previous quarter. First Half of 2026 Highlights Net revenues decreased by 5.2% year over year to RMB4,872.0 million (US$718.0 million) for the first half of 2026. Net revenues from overseas increased by 48.2% year over year to RMB1,270.1 million (US$187.2 million) for the first half of 2026. Net income attributable to the shareholders of Hello Group Inc. was RMB528.5 million (US$77.9 million) for the first half of 2026, compared to RMB217.8 million during the same period of 2025. Non-GAAP net income attributable to the shareholders of Hello Group Inc. (note 1) was RMB602.7 million (US$88.8 million) for the first half of 2026, compared to RMB307.7 million during the same period of 2025. Diluted net income per ADS was RMB3.33 (US$0.49) for the first half of 2026, compared to RMB1.27 during the same period of 2025. Non-GAAP diluted net income per ADS (note 1) was RMB3.80 (US$0.56) for the first half of 2026, compared to RMB1.80 during the same period of 2025. "The Group maintained steady business momentum in the second quarter of 2026," commented Yan Tang, Chairman and CEO of Hello Group. "On the domestic front, Momo navigated external headwinds to sustain the healthy performance of our cash-cow business, while Tantan continued to strengthen its AI capabilities to enhance user experience and monetization efficiency. Overseas, our product portfolio shifted from single-product reliance to more balanced and diversified growth, with growing synergies across the portfolio." Second Quarter of 2026 Financial Results Net revenues Total net revenues were RMB2,486.0 million (US$366.4 million) in the second quarter of 2026, a decrease of 5.1% from RMB2,620.4 million in the second quarter of 2025. Value-added service revenues mainly include virtual gift revenues from various audio, video and text-based scenarios, and membership subscription revenues. Total value-added service revenues were RMB2,439.6 million (US$359.6 million) in the second quarter of 2026, a decrease of 5.4% from RMB2,579.3 million during the same period of 2025. The decrease was primarily due to (a) external factors that influenced the operational focus of certain broadcasters and agencies on Momo app, which are still in recovery; (b) weak consumer sentiment due to macro headwinds; and (c) to a lesser extent, a decline in Tantan resulting from a decline in user base. The decrease was partially offset by the revenue growth from our overseas apps, driven by the rapid expansion from multiple social entertainment and dating brands across our rich portfolio. Other services revenues were RMB46.4 million (US$6.8 million) in the second quarter of 2026, compared to RMB41.1 million during the same period of 2025. Net revenues from Chinese mainland decreased from RMB2,177.9 million in the second quarter of 2025 to RMB1,813.3 million (US$267.2 million) in the second quarter of 2026, primarily due to the decrease in net revenues from Momo app and Tantan app. Net revenues from overseas increased from RMB442.4 million in the second quarter of 2025 to RMB672.7 million (US$99.1 million) in the second quarter of 2026, driven by the growth of new audio- and video-based products in the Middle East and North Africa ("MENA") region, along with incremental revenue from dating brands outside of MENA. Cost and expenses Cost and expenses were RMB2,260.3 million (US$333.1 million) in the second quarter of 2026, an increase of 1.5% from RMB2,227.7 million in the second quarter of 2025. The increase was primarily attributable to: (a) an increase of RMB56.8 million (US$8.4 million) in production costs in connection with films; (b) increased marketing investments in our new overseas apps, partially offset by continued reductions in marketing expenses for our China apps; and (c) increased payment channel costs due to the growth of overseas businesses, which incur higher payment channel costs as a percentage of revenue. The increase was further partially offset by lower revenue-sharing costs with broadcasters on Momo app, despite higher revenue-sharing costs with virtual gift recipients on our overseas apps. Non-GAAP cost and expenses (note 1) were RMB2,222.3 million (US$327.5 million) in the second quarter of 2026, compared to RMB2,183.6 million during the same period of 2025. Income from operations Income from operations was RMB238.0 million (US$35.1 million) in the second quarter of 2026, compared to RMB403.5 million during the same period of 2025. Non-GAAP income from operations (note 1) was RMB276.1 million (US$40.7 million) in the second quarter of 2026, compared to RMB447.7 million during the same period of 2025. Interest income Interest income was RMB53.6 million (US$7.9 million) in the second quarter of 2026, compared to RMB105.5 million during the same period of 2025. The decrease was primarily attributable to: (a) a reduction in the total volume of interest-bearing funds, as a result of bank loan repayments, the distribution of a special cash dividend, settlement of withholding tax accrued for prior periods, certain acquisitions and investments, and payment under the Company's Share Repurchase Program; (b) a lower proportion of high-yield US dollar funds in the total funds; and (c) a drop in the yield of both US dollar and RMB funds due to falling market interest rates. Other gain or loss, net Other gain or loss, net was a net loss of RMB25.1 million (US$3.7 million) in the second quarter of 2026, primarily consisting of losses from unrealized fair value changes in short-term investments, mainly including paper gold. Income tax expenses Income tax expenses were RMB69.6 million (US$10.3 million) in the second quarter of 2026, compared to RMB638.4 million in the second quarter of 2025. The decrease was primarily attributable to the Company's accrual of an additional withholding tax of RMB547.9 million related to dividends paid or payable by its wholly foreign-owned enterprise ("WFOE") in Chinese mainland to its offshore parent company, Momo Hong Kong, in the second quarter of 2025. Share of income on equity method investments Share of income on equity method investments was RMB41.5 million (US$6.1 million) in the second quarter of 2026, compared to RMB13.4 million during the same period of 2025. The increase was primarily attributable to a higher unrealized gain in fair value change of an investment fund. Net income (loss) Net income was RMB238.4 million (US$35.1 million) in the second quarter of 2026, compared to a net loss of RMB139.4 million during the same period of 2025. Non-GAAP net income (note 1) was RMB274.8 million (US$40.5 million) in the second quarter of 2026, compared to a net loss of RMB95.2 million during the same period of 2025. Net income (loss) attributable to the shareholders of Hello Group Inc. Net income attributable to the shareholders of Hello Group Inc. was RMB237.4 million (US$35.0 million) in the second quarter of 2026, compared to a net loss of RMB140.2 million during the same period of 2025. Non-GAAP net income (note 1) attributable to the shareholders of Hello Group Inc. was RMB273.9 million (US$40.4 million) in the second quarter of 2026, compared to a net loss of RMB96.0 million during the same period of 2025. Net income (loss) per ADS Diluted net income per ADS was RMB1.52 (US$0.22) in the second quarter of 2026, compared to a diluted net loss per ADS of RMB0.84 in the second quarter of 2025. Non-GAAP diluted net income per ADS (note 1) was RMB1.75 (US$0.26) in the second quarter of 2026, compared to a diluted net loss per ADS of RMB0.58 in the second quarter of 2025. Cash and cash flow As of June 30, 2026, the Company's cash, cash equivalents, short-term deposits, short-term investments, short-term restricted cash and long-term deposits totaled RMB8,542.4 million (US$1,259.0 million), compared to RMB8,677.6 million as of December 31, 2025. Net cash provided by operating activities in the second quarter of 2026 was RMB642.3 million (US$94.7 million), compared to RMB250.1 million in the second quarter of 2025. First Half of 2026 Financial Results Net revenues for the first half of 2026 were RMB4,872.0 million (US$718.0 million), a decrease of 5.2% from RMB5,141.2 million in the same period of 2025. Net income attributable to the shareholders of Hello Group Inc. was RMB528.5 million (US$77.9 million) for the first half of 2026, compared to RMB217.8 million during the same period of 2025. Non-GAAP net income attributable to the shareholders of Hello Group Inc. (note 1) was RMB602.7 million (US$88.8 million) for the first half of 2026, compared to RMB307.7 million during the same period of 2025. Diluted net income per ADS was RMB3.33 (US$0.49) during the first half of 2026, compared to RMB1.27 in the same period of 2025. Non-GAAP diluted net income per ADS (note 1) was RMB3.80 (US$0.56) during the first half of 2026, compared to RMB1.80 in the same period of 2025. Net cash provided by operating activities was RMB801.3 million (US$118.1 million) during the first half of 2026, compared to RMB489.9 million in the same period of 2025. Recent Development Share repurchase program As of September 3, 2026, the Company has repurchased 68.0 million ADSs for US$424.1 million on the open market under the Share Repurchase Program announced on June 7, 2022 and amended on March 14, 2024 and March 12, 2025, at an average purchase price of US$6.22 per ADS. The remaining size of the program is US$62.0 million. Appointment of New Chief Operating Officer The board of directors has appointed Mr. Jianhua Wen as the chief operating officer of the Company, effective September 3, 2026. In connection with this appointment, Mr. Wen will cease serving as the chief technology officer of the Company on the same date. Mr. Wen served as the chief technology officer of the Company from April 2024 to September 2026. He joined the Company in August 2011 and, prior to his appointment as the chief technology officer, held various positions, including development engineer, technical director and vice president of technology, overseeing the Company's app development and AI department. Before joining the Company, Mr. Wen served as a development engineer at Huawen Group from July 2010 to June 2011. Business Outlook For the third quarter of 2026, the Company expects total net revenues to be between RMB2.4 billion and RMB2.5 billion, representing a decrease of 9.4% to 5.7% year over year. This forecast reflects the Company's current and preliminary views on the market and operational conditions, which are subject to change. Note 1: Non-GAAP measures To supplement our consolidated financial statements presented in accordance with U.S. generally accepted accounting principles ("GAAP"), we, Hello Group, use various non-GAAP financial measures that are 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. 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 from operations, net income (loss), net income (loss) attributable to the shareholders of Hello Group Inc., and diluted net income (loss) 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 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, September 3, 2026, at 7:00 a.m. U.S. Eastern Time (7:00 p.m. Beijing / Hong Kong Time on September 3, 2026). Participants can register for the conference call by navigating to: https://s1.c-conf.com/diamondpass/10056690-cemk7n.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 September 10, 2026. The dial-in details for the replay are as follows: U.S. / Canada: 1-855-883-1031Hong Kong: 800-930-639Passcode: 10056690 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 Asia's online social networking 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. Since 2019, we have continuously expanded our portfolio through internal incubation and strategic acquisitions, adding apps such as Hertz, Soulchill, and Happn. These products target more niche markets and selective user demographics both domestically and internationally, further strengthening our global presence. For investor and media inquiries, please contact: Hello Group Inc. Investor RelationsPhone: +852-3157-1669Email: [email protected] Christensen In ChinaMs. Xiaoyan SuPhone: +86-10-5900-1548E-mail: [email protected] Safe Harbor Statement This news release contains "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements include but are not limited to our management quotes, our financial outlook for the third quarter of 2026, as well as the amount of, timing, methods and funding sources for repurchases of our shares under the share repurchase program. Our forward-looking statements are not historical facts but instead represent only our belief regarding expected results and events, many of which, by their nature, are inherently uncertain and outside of our control. Our actual results and other circumstances may differ, possibly materially, from the anticipated results and events indicated in these forward-looking statements. Announced results for the second quarter of 2026 are preliminary, unaudited and subject to audit adjustment. In addition, we may not meet our financial outlook for the third quarter of 2026 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 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. View original content:https://www.prnewswire.com/news-releases/hello-group-inc-announces-unaudited-financial-results-for-the-second-quarter-of-2026-302868775.html

This article first appeared on GuruFocus. Total Revenue: RMB2.49 billion, down 5% year over year but up 4% quarter over quarter. Domestic Revenue: RMB1.81 billion, down 17% year over year but up 1% quarter over quarter. Overseas Revenue: RMB673 million, up 52% year over year and 13% quarter over quarter, accounting for 27% of total revenue. Adjusted Operating Income: RMB276 million with a margin of 11.1%. Non-GAAP Net Income: RMB273.9 million, compared to a net loss of RMB96 million in the same period of 2025. Value-Added Services (VAS) Revenue: RMB2.44 billion, down 5% year over year but up 4% quarter over quarter. PRC Mainland VAS Revenue: RMB1.77 billion, down 17% year over year but up 1% quarter over quarter. Overseas VAS Revenue: RMB664.9 million, up 51% year over year and 12% quarter over quarter. Non-GAAP Gross Margin: 35.8%, compared to 38.8% in the year-ago period; excluding film production expenses, gross margin would have been 38.1%. Non-GAAP Sales and Marketing Expenses: RMB380.4 million, up 15% year over year, representing 13% of total revenue. Non-GAAP R&D Expenses: RMB171.3 million, compared to RMB172.0 million in the same period last year. Non-GAAP G&A Expenses: RMB75.1 million, compared to RMB67.5 million in the same period last year. Net Cash Provided by Operating Activities: RMB642.3 million in Q2 2026. Cash and Investments: Totaled RMB8.54 billion as of June 30, 2026. Momo Paying Users: Increased by 200,000 quarter over quarter to 3.9 million. Tantan Paying Users: 0.5 million, a decrease of 40,000 quarter over quarter. Tantan Revenue: RMB156 million, down 18% year over year and 3% quarter over quarter. Q3 2026 Revenue Guidance: Expected in the range of RMB2.4 billion to RMB2.5 billion, representing a decrease of 9.4% to 5.7% year over year. Warning! GuruFocus has detected 5 Warning Signs with MOMO. Is MOMO fairly valued? Test your thesis with our free DCF calculator. Release Date: September 03, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Overseas revenue surged 52% year-over-year to RMB673 million, now accounting for 27% of total revenue, up from 17% a year ago, driven by strong momentum in MENA products and acquired dating apps. Momo's paying users increased by 200,000 quarter-over-quarter to 3.9 million, supported by themed events around the World Cup and seasonal occasions, lifting engagement. Tantan's domestic user base stabilized with a slight uptick in Q2, marking the first stabilization since early 2022, aided by AI-driven features like AI icebreaker and AI chat assistant that improved retention. Yaahlan achieved net income breakeven for the first time in Q2, while Amar's net loss is narrowing quickly, demonstrating improving profitability in the MENA product portfolio. The company identified opportunities to optimize channel spend for user acquisition, with holdout experiments showing potential to maintain platform scale and revenue with less marketing expenditure. Happn and other acquired dating products are expanding successfully into new markets like Korea, Taiwan, and the UK, validating long-term growth potential with disciplined investment. Total group revenue declined 5% year-over-year to RMB2.49 billion, with domestic revenue down 17% year-over-year due to continued tax scrutiny on agencies and weak consumer spending. Momo's VAS revenue fell 16% year-over-year, pressured by sustained tax-related negative impacts on agencies and broadcasters, as well as macro-driven softness in consumer spending. Tantan's paying users decreased by 40,000 quarter-over-quarter to 0.5 million, mainly due to Alipay's adjustments to auto-renewal deduction rules pressuring paying conversion. The company revised its Q3 revenue guidance downward, expecting domestic revenue to decline by high teens year-over-year, widening from Q2's 17% decline, due to reduced spending from high-net-worth users. SoulChill's progress moderated due to its removal from the Turkish App Store and ongoing geopolitical tensions in the Middle East, leading to a downward revision of the full-year overseas revenue target by RMB100-200 million. Non-GAAP operating margin declined to 11.1% from 17.1% a year ago, impacted by film production expenses and rising payment channel costs from the geographic mix shift towards international operations. Q: The Q3 guidance implies a widening year-over-year decline for the domestic business compared to Q2. What is the key reason for this change, and what specific measures is the company taking in response? A: (COO & CFO) The revised outlook is primarily due to new trends in Momo's live streaming revenue, specifically a consumption downgrade among high-spending users. While these users remain active, their average revenue per paying user (ARPPU) has declined significantly due to weaker wealth expectations among high-net-worth individuals amid macro volatility. In response, the company will adopt a tiered operating approach: for top-tier users, it will focus on deepening social connections through light-weighted features and exclusive offline events rather than pushing spending; for mid-tier and long-tail users, it will focus on low-barrier, high-retention scenarios like audio-based interactive features and social mini-games. The company is also actively managing costs, including optimizing personnel and sales & marketing expenses, to mitigate bottom-line pressure. Q: With the combined revenue of Yaahlan and Amar approaching that of SoulChill, how will this diversification impact the stability and margin profile of the MENA business? Has the full-year overseas revenue outlook changed? A: (COO & CFO) The combined revenue of the two new MENA products is expected to surpass SoulChill in Q3. This diversification strengthens resilience to external risks, as pressure on one product can be offset by others. On profitability, Yaahlan has already achieved net income breakeven, and Amar is expected to do so in about half a year, with both contributing to group profit next year. However, the CFO noted that the original RMB3 billion overseas revenue target for 2026 is now a "stretch," and the company would rather lower the target by RMB100 million to RMB200 million due to SoulChill's underperformance from external factors, despite the strong growth of the newer apps. Q: Given the weaker domestic revenue outlook for the second half, how should we think about the impact on the group's overall profitability and earnings performance? A: (CFO) The full-year group revenue decline is now expected to be in the mid-single-digit range, larger than the slight decline previously expected. Additionally, investments in two movies have created incremental pressure on the bottom line. However, the company sees opportunities to offset this through cost management and operational efficiency, particularly in personnel and sales & marketing spending. Despite the challenges, the CFO stated that the original target of a low-teens adjusted operating margin for 2026 remains achievable, provided the company executes well on cost control. Q: Can you provide more color on the financial performance and user trends for Momo and Tantan in Q2 2026? A: (COO) Momo's paying users increased by 200,000 quarter-over-quarter to 3.9 million, driven by product iterations and themed events. Momo's VAS revenue was RMB1.54 billion, down 16% year-over-year but up 2% quarter-over-quarter, impacted by tax tightening and macro softness. Tantan's paying users decreased by 40,000 to 0.5 million due to Alipay's auto-renewal policy changes. However, Tantan's domestic user base stabilized with a slight uptick, marking the first stabilization since early 2022. Tantan's total revenue was RMB156 million, down 18% year-over-year, but the company is exploring AI-driven features like AI icebreakers and chat assistants to improve user experience and retention. Q: What were the key drivers behind the strong growth in overseas revenue, and what is the current status of the different overseas products? A: (COO) Overseas revenue reached RMB673 million, up 52% year-over-year and 13% quarter-over-quarter, accounting for 27% of total revenue. Growth was driven by strong momentum from new MENA products (Yaahlan and Amar) and the consolidation of acquired overseas dating products. SoulChill is recovering from its Q1 trough after being removed from the Turkish App Store and facing geopolitical tensions. Happn, the developed-market dating app, has maintained high-quality expansion and is exploring neighboring markets with encouraging early results. The overseas portfolio has shifted from a single-product model to a diversified, balanced growth structure. Q: What is the company's strategy for user acquisition and marketing spend, particularly in light of the challenges in the domestic market? A: (COO) For Momo, a holdout experiment on channel spend for dormant user reactivation revealed inefficiencies in channel investments. The company is confident it can maintain current platform scale and revenue with less spend and will continue to improve acquisition efficiency in Q3. For Tantan, external factors have pushed up unit acquisition costs, leading to a reduction in paid acquisition. However, organic traffic retains better, partially offsetting the pressure. The company is focusing on improving ROI and maintaining a healthy payback period above 100%. Q: Can you elaborate on the impact of the tax-related pressures on Momo's agencies and the measures taken to mitigate them? A: (COO) The year-over-year decline in Momo's VAS revenue was partly due to continued tightening on the tax front, which negatively impacted agencies and broadcasters. In late May, the company rolled out targeted subsidies to ease operating pressure on these agencies, which drove a quick recovery in revenue. The overall VAS revenue share ratio rose by a low single-digit percentage point to support core agencies through the tax compliance process, keeping the supply side stable at a manageable cost. Q: What are the key initiatives for Tantan to counter the revenue decline and improve its business model? A: (COO) Tantan is focusing on AI-driven improvements to the user experience, including AI icebreakers, AI chat assistants, and an AI matching feature to reduce decision fatigue for female users. To address the revenue decline from Alipay's policy changes, Tantan launched a lifetime membership product to encourage longer-cycle subscriptions and upgraded its payment infrastructure to integrate Douyin Pay and WeChat Pay, reducing reliance on a single channel. The company also optimized the matching strategy behind Flash Chat, driving revenue growth in that scenario. Q: What is the company's view on the regulatory environment and its impact on the business outlook? A: (CFO) The company is not seeing any significant incremental regulatory pressure and expects the environment to remain relatively stable. This is not a major driver of the change in the outlook. The primary headwind is the macro spending environment, particularly among the top cohort of users, which is affecting discretionary and For the complete transcript of the earnings call, please refer to the full earnings call transcript.

BEIJING, Aug. 10, 2026 /PRNewswire/ -- Hello Group Inc. (NASDAQ: MOMO) (the "Company"), a leading player in Asia's online social networking space, today announced that it will release its unaudited financial results for the second quarter ended June 30, 2026 before U.S. markets open on Thursday, September 3, 2026. Hello Group's management will host an earnings conference call on Thursday, September 3, 2026, at 7:00 a.m. U.S. Eastern Time (7:00 p.m. Beijing / Hong Kong Time on the same day). Preregistration Information Participants can register for the conference call by navigating to https://s1.c-conf.com/diamondpass/10056690-cemk7n.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 September 10, 2026. The dial-in details for the replay are as follows: 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 Asia's online social networking 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 we added to 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. Since 2019, we have continuously expanded our portfolio through internal incubation and strategic acquisitions, adding apps such as Hertz, Soulchill, and Happn. These products target more niche markets and selective user demographics both domestically and internationally, further strengthening our global presence. For investor and media inquiries, please contact: Hello Group Inc. Investor RelationsPhone: +852-3157-1669Email: [email protected] Christensen In ChinaMs. Xiaoyan SuPhone: +86-10-5900-1548E-mail: [email protected] View original content:https://www.prnewswire.com/news-releases/hello-group-to-report-second-quarter-2026-results-on-september-3-2026-302847025.html

BEIJING, June 2, 2026 /PRNewswire/ -- Hello Group Inc. (NASDAQ: MOMO) ("Hello Group" or the "Company"), a leading player in Asia's online social networking space, today announced its unaudited financial results for the first quarter of 2026. First Quarter of 2026 Highlights Net revenues decreased by 5.3% year over year to RMB2,386.0 million (US$345.9 million[*]) in the first quarter of 2026. Net revenues from overseas increased by 44.1% year over year to RMB597.4 million (US$86.6 million) in the first quarter of 2026. Net income attributable to the shareholders of Hello Group Inc. was RMB291.0 million (US$42.2 million) in the first quarter of 2026, compared to RMB358.0 million in the same period of 2025. Non-GAAP net income attributable to the shareholders of Hello Group Inc. (note 1) was RMB328.8 million (US$47.7 million) in the first quarter of 2026, compared to RMB403.8 million in the same period of 2025. Diluted net income per American Depositary Share ("ADS") was RMB1.81 (US$0.26) in the first quarter of 2026, compared to RMB2.07 in the same period of 2025. Non-GAAP diluted net income per ADS (note 1) was RMB2.05 (US$0.30) in the first quarter of 2026, compared to RMB2.34 in the same period of 2025. For Momo app, total paying users were 3.7 million for the first quarter of 2026, compared to 4.2 million for the same period last year, and 3.9 million from last quarter. Tantan had 0.6 million paying users for the first quarter of 2026 compared to 0.8 million from the year ago period and 0.6 million from last quarter. "In the first quarter of 2026, the Group maintained steady business momentum." commented Yan Tang, Chairman and CEO of Hello Group. "Guided by our strategic focus, our domestic business continued to sustain the healthy operation of the cash cow business through a focus on product innovation and refined operations. Leveraging the synergy of a diversified product portfolio, our overseas business has maintained a positive development trend. Looking ahead, we are confident in our ability to execute on the strategic roadmap for each business line in 2026." First Quarter of 2026 Financial Results Net revenues Total net revenues were RMB2,386.0 million (US$345.9 million) in the first quarter of 2026, a decrease of 5.3% from RMB2,520.8 million in the first quarter of 2025. Value-added service revenues mainly include virtual gift revenues from various audio, video and text-based scenarios, and membership subscription revenues. Total value-added service revenues were RMB2,353.6 million (US$341.2 million) in the first quarter of 2026, a decrease of 5.5% from RMB2,489.9 million during the same period of 2025. The decrease was primarily due to external factors that influenced the operational focus of certain broadcasters and agencies on Momo app, which are still in recovery, and to a lesser extent, the decline in Tantan resulting from a decline in user base. The decrease was largely offset by the revenue growth from our overseas apps, driven by the rapid expansion from multiple social entertainment and dating brands across our rich portfolio. Other services revenues were RMB32.3 million (US$4.7 million) in the first quarter of 2026, compared to RMB30.9 million during the same period of 2025. Net revenues from Chinese mainland decreased from RMB2,106.2 million in the first quarter of 2025 to RMB1,788.6 million (US$259.3 million) in the first quarter of 2026, primarily due to the decrease in net revenues from Momo app and Tantan app. Net revenues from overseas increased from RMB414.6 million in the first quarter of 2025 to RMB597.4 million (US$86.6 million) in the first quarter of 2026, driven by the growth of audio- and video-based products in the Middle East and North Africa ("MENA") region, primarily by the new apps, along with incremental revenue from dating brands outside of MENA. Cost and expenses Cost and expenses were RMB2,088.7 million (US$302.8 million) in the first quarter of 2026, a decrease of 6.5% from RMB2,234.5 million in the first quarter of 2025. The decrease was primarily attributable to: (a) a decrease in revenue sharing with broadcasters on Momo app, partially offset by an increased revenue sharing with virtual gift recipients on overseas apps; (b) a decrease in salary expenses and share-based compensation expenses, due to our continuous optimization in personnel costs and the newly granted share options which had lower fair value; and (c) partially offset by increased investment in marketing for our new overseas apps while we continued to reduce marketing expenses for China apps. Non-GAAP cost and expenses (note 1) were RMB2,049.3 million (US$297.1 million) in the first quarter of 2026, compared to RMB2,188.8 million during the same period of 2025. Income from operations Income from operations was RMB309.7 million (US$44.9 million) in the first quarter of 2026, compared to RMB299.5 million during the same period of 2025. Non-GAAP income from operations (note 1) was RMB349.2 million (US$50.6 million) in the first quarter of 2026, compared to RMB345.3 million during the same period of 2025. Interest income Interest income was RMB54.0 million (US$7.8 million) in the first quarter of 2026, compared to RMB120.3 million during the same period of 2025. The decrease was primarily attributable to: (a) a reduction in the total volume of interest-bearing funds, as a result of bank loan repayments, the distribution of a special cash dividend, settlement of withholding tax accrued for prior periods, certain acquisitions and investments, and payment under the Company's Share Repurchase Program; (b) a lower proportion of high-yield US dollar funds in the total funds; and (c) a drop in the yield of both US dollar and RMB funds due to falling market interest rates. Income tax expenses Income tax expenses were RMB79.9 million (US$11.6 million) in the first quarter of 2026, compared to RMB70.4 million in the first quarter of 2025. Share of income on equity method investments Share of income on equity method investments was RMB8.5 million (US$1.2 million) in the first quarter of 2026, compared to RMB39.7 million during the same period of 2025. The decrease was primarily attributable to lower fair value gains recognized from an investment in an open mutual fund. Net income Net income was RMB291.5 million (US$42.3 million) in the first quarter of 2026, compared to RMB358.5 million during the same period of 2025. Non-GAAP net income (note 1) was RMB329.3 million (US$47.7 million) in the first quarter of 2026, compared to RMB404.3 million during the same period of 2025. Net income attributable to the shareholders of Hello Group Inc. Net income attributable to the shareholders of Hello Group Inc. was RMB291.0 million (US$42.2 million) in the first quarter of 2026, compared to RMB358.0 million during the same period of 2025. Non-GAAP net income (note 1) attributable to the shareholders of Hello Group Inc. was RMB328.8 million (US$47.7 million) in the first quarter of 2026, compared to RMB403.8 million during the same period of 2025. Net income per ADS Diluted net income per ADS was RMB1.81 (US$0.26) in the first quarter of 2026, compared to RMB2.07 in the first quarter of 2025. Non-GAAP diluted net income per ADS (note 1) was RMB2.05 (US$0.30) in the first quarter of 2026, compared to RMB2.34 in the first quarter of 2025. Cash and cash flow As of March 31, 2026, the Company's cash, cash equivalents, short-term deposits, short-term investments, short-term restricted cash and long-term deposits totaled RMB8,561.0 million (US$1,241.1 million), compared to RMB8,677.6 million as of December 31, 2025. Net cash provided by operating activities in the first quarter of 2026 was RMB158.9 million (US$23.0 million), compared to RMB239.7 million in the first quarter of 2025. Recent Development Payment of a special cash dividend In March 2026, Hello Group's board of directors declared a special cash dividend in the amount of US$0.28 per ADS, or US$0.14 per ordinary share. The cash dividend was paid in April 2026 to shareholders of record at the close of business on April 10, 2026. The aggregate amount of cash dividends paid was US$41.2 million. Share repurchase program As of June 2, 2026, the Company has repurchased 63.7 million ADSs for US$399.5 million on the open market under the Share Repurchase Program announced on June 7, 2022 and amended on March 14, 2024 and March 12, 2025, at an average purchase price of US$6.25 per ADS. The remaining size of the program is US$86.6 million. Business Outlook For the second quarter of 2026, the Company expects total net revenues to be between RMB2.45 billion and RMB2.55 billion, representing a decrease of 6.5% to 2.7% year over year. This forecast reflects the Company's current and preliminary views on the market and operational conditions, which are subject to change. Note 1: Non-GAAP measures To supplement our consolidated financial statements presented in accordance with U.S. generally accepted accounting principles ("GAAP"), we, Hello Group, use various non-GAAP financial measures that are 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. 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 from operations, net income, net income attributable to the shareholders of Hello Group Inc., and diluted net income per ADS) is adjusted from the most comparable GAAP results to exclude share-based compensation, amortization of intangible assets from business acquisitions, and tax impacts related to the amortization of intangible assets from business acquisitions. A limitation of using these non-GAAP financial measures is that share-based compensation, amortization of intangible assets from business acquisitions and tax impacts related to the amortization of intangible assets from business acquisitions have been and will continue to be for the foreseeable future 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 Tuesday, June 2, 2026, at 7:00 a.m. U.S. Eastern Time (7:00 p.m. Beijing / Hong Kong Time on June 2, 2026). Participants can register for the conference call by navigating to:https://s1.c-conf.com/diamondpass/10054808-suvwn2.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 June 10, 2026. The dial-in details for the replay are as follows: U.S. / Canada: 1-855-883-1031Hong Kong: 800-930-639Passcode: 10054808 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 Asia's online social networking 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. Since 2019, we have continuously expanded our portfolio through internal incubation and strategic acquisitions, adding apps such as Hertz, Soulchill, and Happn. These products target more niche markets and selective user demographics both domestically and internationally, further strengthening our global presence. For investor and media inquiries, please contact: Hello Group Inc. Investor RelationsPhone: +852-3157-1669Email: [email protected] Christensen In ChinaMs. Xiaoyan SuPhone: +86-10-5900-1548E-mail: [email protected] 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 second quarter of 2026, 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 first quarter of 2026 are preliminary, unaudited and subject to audit adjustment. In addition, we may not meet our financial outlook for the second quarter of 2026 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 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. View original content:https://www.prnewswire.com/news-releases/hello-group-inc-announces-unaudited-financial-results-for-the-first-quarter-of-2026-302788171.html

Interested in Hello Group Inc. Sponsored ADR? Here are five stocks we like better. Q1 revenue fell 5% to RMB 2.39 billion as weakness in mainland China offset strong overseas growth, but adjusted operating income still rose 1% to RMB 349 million on improved margins. Domestic business remains under pressure from tax scrutiny, softer consumer sentiment, and Alipay billing changes, with Momo revenue down 15% year over year and Tantan paying users slipping to 600,000. Overseas operations were the main growth engine, with revenue up 44% year over year as newer MENA products surged, while Hello Group also highlighted AI investments and reaffirmed expectations for near-flat to slightly lower full-year revenue. Hello Group Stock is Attractive Value Speculators Hello Group (NASDAQ:MOMO) reported a decline in first-quarter revenue as weakness in its mainland China operations offset rapid growth overseas, while management said adjusted operating income edged higher on improved margins. For the first quarter of 2026, total revenue was RMB 2.39 billion, down 5% from a year earlier and 7% from the prior quarter, according to CFO Hui Peng. Non-GAAP net income attributable to shareholders was RMB 328.8 million, compared with RMB 403.8 million in the same period of 2025 and RMB 281.3 million in the previous quarter. → Best Buy’s AI Laptop Boost Sparks Hope for a BBY Turnaround MOMO Is Not Getting Love From Investors Sichuan Zhang said the company maintained “steady business momentum” during the quarter, with domestic operations remaining healthy despite external pressure and overseas revenue continuing to grow. Domestic revenue was RMB 1.79 billion, down 15% year over year, while overseas revenue rose 44% to RMB 597 million. Overseas revenue accounted for 25% of total revenue, up from 16% in the prior-year quarter. Adjusted operating income was RMB 349 million, up 1% year over year, with an adjusted operating margin of 14.6%. → 3 Up-and-Coming Stocks That Could Be the Next NVIDIA Management said Momo, the company’s core domestic platform, remains focused on stabilizing its user base and improving monetization efficiency. Zhang said the company continued refining chat features, including its “Knock Knock” matching function, voice and video interaction tools, and AI-assisted greetings and chat support. However, Momo revenue fell 15% year over year and 9% quarter over quarter to RMB 1.52 billion. Zhang attributed the year-over-year decline primarily to the continuing impact of new tax regulations and stricter local enforcement that began in the second half of 2025, which affected some high-grossing agencies and broadcasters. The sequential decline was largely seasonal, tied to the Chinese New Year, as well as soft consumer spending sentiment. → These 3 CLO ETFs Target a Niche Corner of the Fixed-Income Market During the question-and-answer session, CEO Yan Tang said tax authorities tightened policies targeting agencies again in early 2026, pressuring agency-related revenue in March and April. Tang said Hello Group began assisting selected high-quality agencies with tax compliance in mid-May and introduced a new incentive program to help offset profit pressure from compliance costs. “Since late May, both operational enthusiasm and revenue among these agencies have rebounded actually rapidly,” Tang said through the call interpreter. “We expect their performance to return to normal level by Q3.” Peng said the domestic business is now expected to decline by a mid-teens percentage for the full year, compared with the company’s prior expectation for a low-teens decline. She said the most difficult period from tax-related disruption is likely behind the company, although some pressure may carry into the third quarter. Tantan ended the quarter with 600,000 paying users, down by 30,000 from the prior quarter. Zhang said the decline reflected a continuing reduction in monthly active users and changes to Alipay’s auto-renewal billing rules, which created short-term pressure on membership conversion. Tantan’s domestic revenue was RMB 125 million, down 25% year over year and 8% quarter over quarter. Management said the company has reduced channel investments and personnel costs, helping net profit grow significantly year over year. Tang said Alipay’s policy changes primarily affected subscription and membership products, especially Tantan’s domestic membership business. He said Momo’s core payment model is based on consumable virtual gifts and is not materially dependent on auto-renewal, while overseas businesses use App Store and Google Play payment channels. To offset pressure on Tantan, management said the team unbundled some membership benefits, such as Super Likes and Boosts, into standalone purchases and improved pay-as-you-go features like Flash Chats. Tang said the company expects the Alipay-related impact to be concentrated in the first half of the year and gradually improve in the second half as payment channels and membership structures are adjusted. Hello Group’s overseas business remained a major growth driver. Zhang said overseas revenue reached RMB 597 million, up 44% year over year, though down 2% sequentially. Peng said overseas value-added services revenue rose 44% to RMB 593.7 million, driven by expansion of the company’s diversified product portfolio. Management said the sequential softness reflected Ramadan seasonality and external challenges in the Middle East and North Africa region, including pressure on Social, the company’s flagship overseas app. Peng said Social was affected by tighter regulation in Turkey, which resulted in the temporary removal of social and streaming apps across the industry, as well as conflict-related pressure in the Gulf region. Tang said the company believes Social complies with Turkish laws and regulations and is working with authorities to return the app to app stores. He added that the business has begun recovering from its first-quarter low and that Hello Group is accelerating localization in other markets to offset the Turkey impact. The company’s newer MENA products, Yaahlan and amar, continued to grow rapidly, with both posting triple-digit year-over-year revenue growth in the quarter. Zhang said Yaahlan is approaching net income break-even, while amar achieved positive marginal contribution for the first time. Tang said Yaahlan should reach net profitability within a quarter, while amar is roughly six months behind on that path. Peng said the company still expects 2026 overseas revenue to approach an RMB 3 billion milestone, with possible variation of about RMB 100 million in either direction depending on market expansion. Management also highlighted AI as a product development priority. Tang said AI is “particularly meaningful” for a company centered on social products because it can lower barriers to user connections and improve engagement. Tang said the company is pursuing two AI directions: tools that help users break the ice, such as AI-assisted chat and AI voice “drift bottle” features, and new AI-native product formats. He cited Donut, a fully AI-powered voice social product that has begun monetization in China, and MiraiMind, an AI role-play dating app that has shown early traction in Japan and is expanding into other Asian markets. Tang said AI investment is expected to be “high return” because it can improve user experience and increase willingness to pay. He said the company plans to reuse its AI technology stack across additional use cases, including AI agents for Momo live streaming, AI-generated short dramas based on broadcasters’ images, and smarter matching and chat support for Tantan. Hello Group guided for second-quarter revenue of RMB 2.45 billion to RMB 2.55 billion, representing a year-over-year decline of 6.5% to 2.7%. At the midpoint, Peng said mainland China revenue is expected to decline by a high-teens percentage, while overseas revenue is expected to grow by a high-50s percentage. For the full year, Peng said group revenue is now expected to decline slightly from 2025, “probably down by a couple of percentage points.” She said the company still expects to achieve an adjusted operating margin in the low teens, consistent with its earlier target, though lower absolute revenue creates pressure on absolute profit levels. As of March 31, Hello Group held RMB 8.56 billion in cash, deposits, short-term investments and restricted cash, compared with RMB 8.68 billion at the end of 2025. Net cash provided by operating activities was RMB 158.9 million in the quarter. Hello Group Inc (NASDAQ: MOMO) is a China-based technology company specializing in mobile social networking and interactive entertainment. Its flagship product, the Momo app, offers location-based social discovery services that enable users to find and connect with new friends based on shared interests and geographic proximity. The platform integrates instant messaging, group chat, and content-sharing features, while also providing premium subscriptions and in-app purchases such as virtual gifts and sticker packs. In addition to Momo, Hello Group's portfolio includes Tantan, a dating-focused social app designed to help users build meaningful relationships through profile matching and interest-driven swiping. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Hello Group Q1 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for June 2026.

Image source: The Motley Fool. Wednesday, March 18, 2026 at 8:00 a.m. ET Chief Operating Officer — Zhang Sichuan Chief Financial Officer — Peng Hui Investor Relations Director — Ashley Jing Operator: Ladies and gentlemen, thank you for standing by, and welcome to Hello Group's Fourth Quarter 2025 Earnings Conference Call. [Operator Instructions] Please note this conference is being recorded today. I would now like to hand the conference over to your first speaker today, Ms. Ashley Jing. Thank you. Please go ahead, ma'am. Ashley Jing: Thank you, operator. Good morning, and good evening, everyone. Thank you for joining us today for Hello Group's Fourth Quarter and Fiscal 2025 Earnings Conference Call. The company's results were released earlier today and are available on the company's IR website. On the call today are Ms. Zhang Sichuan, COO of the company; and Ms. Peng Hui, CFO of the company. They will discuss the company's business operations and highlights as well as the financials and guidance. They will be available to answer your questions during the Q&A session that follows. Before we begin, I would like to remind you that this call may contain forward-looking statements made under the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Such statements are based on management's current expectations and current market and operating conditions and relate to events that involve known or unknown risks, uncertainties and other factors, all of which are difficult to predict and many of which are beyond the company's control, which may cause the company's actual results, performance or achievements to differ materially from those in the forward-looking statements. Further information regarding this and other risks, uncertainties and factors is included in the company's filings with the U.S. Securities and Exchange Commission. The company does not undertake any obligation to update any forward-looking statements as a result of new information, future events or otherwise, except as required under law. I will now pass the call over to our COO, Ms. Zhang Sichuan. Ms. Zhang, please? Sichuan Zhang: Thank you, Ashley. Hello, everyone. Thank you for joining today's call. In the second half of 2025, our domestic business faced fresh external headwinds. That said, through the team's agile response and strong execution, we kept our cash cow business stable while sustaining a healthy ecosystem. To better show you our ongoing structural transition towards overseas growth, we began providing a geographic revenue breakdown in 2025 to improve transparency for investors. Our overseas business delivered exceptional results last year, fueled by organic product incubation and targeted M&A. This allowed us to diversify our portfolio and rapidly expand our global presence, leading to accelerated revenue momentum. The overseas business is now a solidified revenue contributor and a key engine for our future growth. Next, I'll walk you through the major highlights from Q4 and the full year of 2025 across our business lines, followed by our strategic priorities for 2026. Starting with the financials. For Q4 '25, total group revenue was RMB 2.58 billion, down 2% year-over-year. Domestic revenue reached RMB 1.97 billion, down 14% year-over-year. Overseas revenue was RMB 608 million, up 70% year-over-year. Overseas revenue accounted for 24% compared to 14% in the same period last year. Adjusted operating income was RMB 354 million, up 26% year-over-year with a margin of 13.7%. For fiscal 2025, total group revenue was RMB 10.37 billion, a slight decrease of less than 2% year-over-year. Domestic revenue reached RMB 8.37 billion, down 11% year-over-year. Overseas revenue reached RMB 2 billion, up 71% year-over-year. Overseas revenue now accounts for 19% of our total, up for 11% in 2024. Adjusted operating income was RMB 1.55 billion, down 10% year-over-year with a margin of 15% Next, I'll review the execution of the strategic priorities for Momo and Tantan and our new endeavors in 2025. Let's start with Momo. Our goal is to maintain the productivity of this cash cow while keeping the social ecosystem healthy. Over the past year, our product and channel efforts are centered on this core objective. On the product side, we focused on 2 major upgrades. First, we upgraded the AI greeting and AI chat assist models to help users break the ice with personalized messages and keep conversation going. Our tech team is consistently iterating these models to make them more humanized and diverse. This upgrades, combined with tailored exposure strategies, significantly boosted the adoption rate of our AI features. Second, we optimized our product strategy for real-time chat scenario. By using historical data to target users with high chat intent, we have made matching more accurate and interactions smoother. This led to an increase in key metrics such as number of 2-way chats and the rate of in-depth chats. For user acquisition, we proactively cut negative ROI marketing spend refined channel and material by ROI and rebalanced spend between new acquisitions and dormant user reactivation. This helped us to reduce average acquisition cost despite intensifying channel competition. We also boosted conversation in high ARPU paying scenario, sustaining ARPU growth and delivering profitable ROI all year. We are highly satisfied with 2025 channels results. Early marketing cuts led to some trends among ultra-low spenders, but with very limited revenue drag. In fact, reducing the inefficient spending helped stabilize our profit. While paying users declined sharply in the first half of the year, the impact bottomed out in the second half. Our new features in audio and video scenarios drove gains in paying ratio, resulting in 3.9 million paying users of Momo in Q4. That's up 200,000 quarter-over-quarter. With some subscription growth in 2 straight quarters, we see clear evidence of healthy recovery. This validates our strategy to broaden low-ticket payment scenario. In the current economic environment, by focusing on [ non-WOU ] users and a profit-centric channel approach, we have strengthened Momo's position as a resilient 15-year-old cash cow. This strategy has enabled the platform to preserve strong operational help, exhibit solid resilience against external pressures and consistently deliver stable results. Turning to Momo's commercial performance. In Q4, Momo's VAS revenue was RMB 1.68 billion, a year-over-year decrease of 14% and a sequential decrease of 6%. As mentioned last quarter, the decline was mainly due to the new tax regulations in October and stricter enforcement which significantly dampened the motivation of high-grossing streamers and agencies. For the full year 2025, Momo's VAS revenue totaled RMB 7.09 billion, down 11% year-over-year. Beyond tax factors, macro softness also affected spender sentiment among high-value users. Product and operation-wise, we focus to focus -- we continue to focus on our top cohort users in live streaming through specialized events and gameplay innovation. Meanwhile, we pivoted our emphasis towards audio and video scenarios that better align with mid-tier and long-tail users. This shift helped offset some of the external headwinds on revenue. Furthermore, the growing proportion of the revenue from higher-margin audio and video scenarios contributed our overall gross margin stable. Now let's turn to Tantan. Our 2025 goal was to build a dating experience and efficient business model tailored for Asian users. As of Q4, Tantan has 600,000 paying users, a decrease from 700,000 from last quarter. Marketing costs have driven user declines in recent years, but our return to brand building and experience optimization have kept organic traffic stable. Currently, the vast majority of new users on Tantan come from organic growth. and the platform is no longer reliant on channel acquisition. At the same time, retention has improved slightly. On the financial side, in Q4, Tantan's domestic business generated RMB 136 million in revenue, down RMB 41 million year-over-year and RMB 16 million quarter-over-quarter. For the full year 2025, domestic revenue totaled RMB 613 million compared to RMB 733 million in 2024. The decline was a deliberate result of reducing channel investments through steady ARPU growth provided a partial offset. On the product side, we rolled out our new version in the first half of 2025, focusing on real person verification and a cleaner interface. We further advanced AI tools for profile enrichment and chat assistance while improving the female users' recommendation. This reduced noise from poor matches and development chat boosted female users retention and like per user. To balance the revenue impact of declining paying users, we also restructured membership tiers to improve low-end coverage and increase paywall exposure for users with high payment potential. This product and algorithmic optimization drove increases in both pay conversion rate and ARPU. Regarding channels, we focus on achieving 100% return on acquisition costs. By cutting high-cost negative ROI channels, we significantly narrowed acquisition costs compared to last year. Combined with ARPU improvement driven by product upgrades, Tantan achieved full payback on channel investment in Q1 with ROI reaching new highs throughout the year. Based on this trajectory, we expect Tantan to generate around RMB 100 million in annual operating profit for the foreseeable future. This gives the team a comfortable window to focus on what matters most, the long-term retention of the Tantan users. This can be achieved only through providing a better dating experience and building a brand image as a dating platform uniquely for Asian daters. We will continue to plough this land until we get the reward we deserve. Lastly, our new businesses. In 2025, our goal was to deepen our overseas presence, enrich our brand portfolio and build a long-term growth engine. In Q4, overseas revenue reached RMB 608 million, up 70% year-over-year and 14% quarter-over-quarter. For the full year 2025, overseas revenue totaled RMB 2 billion, a 71% year-over-year growth. This growth has largely offset the revenue dip in the domestic market. This rapid growth was driven by audio and video social products in MENA region, especially Yaha Live and Amar. The 2 new apps that began monetization at the end of 2024, leveraging the successful experience of SoulChill, which has driven continued revenue growth while narrowing the net loss. Meanwhile, SoulChill remain our largest contributor, although its growth fell slightly short of our initial expectation due to slower localization, which slowed our plans to expand into live streaming and the wealthier golf countries. For 2026, strengthening our regional operation remain a top priority. Beyond MENA, we have seen great progress with MiraiMind in Japan. As mentioned before, MiraiMind is an AI-powered anime style companion and romance app. Its AI-driven character creation and natural language model has been very well received, and we see a clear expansion opportunities there. In our Dating segment, Tantan International officially separated its domestic and overseas version in the second half of 2025, allowing for a more tailored international experience. This separation removed historical technical and operational constraints, laying on a solid foundation for Tantan's long-term international growth. We also made a major breakthrough by acquiring Happn, a well-known European dating product, which was an important driver of the accelerated year-over-year overseas revenue growth in Q4. This, along with other recent acquisitions has allowed us to rapidly penetrate key untapped markets, including Europe, Turkey and South America. Moving forward, we plan to bring this premium global brands into Asian markets to create even more synergies across our ecosystem. Overall, in 2025, our overseas business delivered robust gains in both scale and quality. driven by a multiproduct strategy, deepening penetration in core regions, leveraging our proven expertise and complementing organic growth with strategy acquisition. Moving forward, we remain committed to solidifying our marketing -- our market position in MENA region, rapidly enter high potential new markets and maximizing synergies across our core business segments, thereby establishing overseas operation as a key driver of the group's sustained long-term growth. That concludes our business review for 2025. For 2026, we will continue our strategy, our strategic priorities, Momo for productivity, Tantan for the Asian leading experience and new businesses for the growth engine. Lastly, I'm pleased to announce that our Board has approved a special cash dividend in the amount of USD 0.28 per ADS for a total cash payment of approximately USD 42.6 million or about 30% of the adjusted net income contributed to -- hello Group Inc. in 2025. And this is the eighth consecutive year of dividends, reflecting our stable operation and commitment to creating long-term value for shareholders. This concludes my remarks. Now let me pass the call over to Cathy for financial review. Cathy, please. Cathy Peng: Thanks, Sic. Hello, everyone. Thank you for joining our conference call today. Now let me take you through the financial review. Total revenues for the fourth quarter 2025 was RMB 2.58 billion, down 2% year-on-year and 3% quarter-on-quarter. Non-GAAP net income attributable to the company was RMB 281.3 million compared to RMB 230.5 million in the same period of 2024 and RMB 404.5 million in the previous quarter. Looking into key revenue items for Q4. Total revenue for value-added services for the fourth quarter of 2025 was RMB 2.53 billion, down 2% year-on-year and 3% quarter-on-quarter. On a geographic basis, PRC Mainland VAS revenue was RMB 1.93 billion, down 14% year-on-year and 3% quarter-over-quarter. The decrease was primarily due to 3 factors: number one, heightened tax scrutiny on the supply side, which diverted their operational focus; number two, softened consumer sentiment amid broad macro pressures; and number three, a decline in paying users on Tantan. VAS overseas revenue reached RMB 604.4 million, up 70% year-over-year and 13% quarter-over-quarter. This robust growth was primarily fueled by the rapid expansion from multiple social entertainment and dating brands across our diverse portfolio. Turning to costs and expenses. Non-GAAP cost of revenue for the fourth quarter of 2025 was RMB 1.6 billion compared to RMB 1.72 billion for the same period last year. Non-GAAP gross margin for the quarter was 37.8% compared to 34.7% from a year ago period. In Q4 '24, our non-GAAP cost of revenue included certain one-off items. Excluding these special items, gross profit margin in Q4 '25 was slightly down 0.4 percentage points year-over-year. The decrease was the net impact from several factors due to the same structural shift of revenue toward membership subscription revenue in the overseas market, especially in developed markets. These factors are: number one, payment channel costs accounted for a higher proportion of total revenues. two, personnel costs increased as a percentage of revenue; and number three, revenue share to the content providers and agencies decreased as a percentage of revenues. The first 2 are headwinds to gross margin and the third one is a tailwind. Non-GAAP R&D expenses for the fourth quarter was RMB 203.9 million compared to RMB 212.4 million for the same period last year, representing a 4% decrease year-over-year. The decrease was attributed to optimization of engineering personnel. Non-GAAP R&D expenses as a percentage of revenue was 8%, same as Q4 last year. We ended the quarter with 1,400 total employees compared to 1,390 from a year ago. The R&D personnel as a percentage of total employees for the group was 56% compared to 61% from Q4 last year. Non-GAAP sales and marketing expenses for the fourth quarter was RMB 339.9 million compared to RMB 311.7 million for the same period last year, representing 13% and 12% of total revenues, respectively. The year-over-year increase in sales and marketing expenses was primarily driven by marketing investment in our overseas apps. This increase was partially offset by our ongoing cost control measures in the PRC Mainland businesses, where both Momo and Tantan reduced their marketing spend. Non-GAAP G&A expenses was RMB 85.7 million for the fourth quarter compared to RMB 117.6 million for the same quarter last year, representing 3% and 4% of total revenue, respectively. The decrease in G&A expenses was due to a combination of factors that resulted in a high base in Q4 '24, including provisions for some pending legal matters as well as due diligence costs in connection with potential investments. Non-GAAP operating income was RMB 354.1 million, representing a margin of 13.7% compared with RMB 279.9 million and a margin of 10.6% from Q4 '24. Excluding certain one-off costs and expenses items, operating margin for Q4 '24 would have been 14.2%. Non-GAAP operating expenses as a percentage of total revenue stood at 24%, unchanged from the year ago period. Now briefly on income tax expenses. Total non-GAAP income tax expenses was RMB 72.0 million for the quarter with an effective tax rate of 17%. In Q4, the company accrued withholding income tax of RMB 18.4 million, which is 10% of undistributed profit generated by our ROFE. Without the withholding tax, our estimated non-GAAP effective tax rate was around 13% in the fourth quarter. Now turning to balance sheet and cash flow items. As of December 31, 2025, Hello Group's cash, cash equivalents, short-term deposits, long-term deposits, short-term investments and restricted cash totaled RMB 8.68 billion compared to RMB 14.73 billion as of December 31, 2024. The decrease in cash reserves was attributable to bank loan repayments, distribution of a special cash dividend, settlement of withholding tax accrued for prior periods, together with certain acquisitions and investments and ongoing repurchases of the company's own shares throughout 2025. Net cash provided by operating activities in the fourth quarter 2025 was RMB 549.7 million. Lastly, on business outlook. We estimated our first quarter revenue to come in the range from RMB 2.3 billion to RMB 2.4 billion, representing a decrease of 8.8% to 4.8% year-on-year. This is based on the assumption that at midpoint on a year-over-year basis, revenue from our Mainland China business will decline by mid- to high teens percentage-wise, while overseas revenue is expected to grow by high 40s percentage-wise. Please be mindful that this forecast represents the company's current and preliminary view on the market and operational conditions, which are subject to change. That concluded our prepared portion of today's discussion. With that, let me turn the call back to Ashley to start Q&A. Ashley, please. Ashley Jing: [Operator Instructions] Operator, we're ready for questions. Operator: [Operator Instructions] Your first question comes from Thomas Chong with Jefferies. Thomas Chong: Based on the guidance just given now, Q1 domestic business is expected to decline more than what we saw in Q4 last year and full year 2025. Can management provide some color about the trend for domestic revenue this year? What are the measures undertaken on this cash cow business? When should we expect domestic revenue to start declining year-on-year and stabilize? Sichuan Zhang: Thank you. Looking back, our 2025 revenue hit the overall target. But the path, there was a little bit of surprise. We actually started the year very strong by tapping into our mid-tier and regular users, which helped us beat expectations in the first half. However, things got tougher in the second half. New tax policies really hit our supply side and momentum slowed. That said, the Momo team did an incredible job staying steady a really challenging environment, and we are very happy with how they handle it. So while the top-tier users started to tighten their belts, we pivoted and we did it fast. We moved our focus to small ticket spender. -- think social games and direct chat features that don't need expensive agencies. We kept moving our AI tools to make the social experience smoother. This strategy worked. We added 400,000 new paying users in the second half of the year. For a mature platform like Momo, growing that much in this economy is not easy. This shows our business is becoming more resilient and less dependent on top-tier users. Protecting profits, I think I want to highlight that we have been very proactive with our cost cutting. Because we streamlined our teams and reduced channel spending, our profit didn't drop nearly as much as our revenue did. We are keeping the cash cow healthy. Looking into 2026, we are not expecting the macro environment to fix itself overnight. So we are sticking the game plan that works in 2025. On the product side, more AI, better chat features and more social games to keep users grew to the platform. On the money side, we will keep focusing on audio and video scenarios that regular users love. We also expect revenue pressures to continue this year, similar to what we saw in 2025. But our commitment to efficiency is ironclad. Even if the top line numbers fluctuated, we are fully confident that we can keep our profit stable. Let me hand it to Cathy to dig into the numbers. Cathy Peng: Okay. I would like to frame the 2026 revenue outlook around my good old 3 key drivers. Number one is regulatory environment; number two, macro conditions; and number three, platform fundamentals. Firstly, on regulation. The tax scrutiny on agencies and broadcasters in the second half of '25 materially impacted our value-added services revenues. But we believe most of the negative impact from that scrutiny has been absorbed by the end of Q1 '26. So assuming no incremental regulatory tightening from here, Q1 should provide a cleaner base to assess underlying trends. Second factor, macro. Consumer sentiment remains soft, perhaps even a little bit softer compared to a year ago. That said, macro conditions have been challenging for the past several years, and we have been adapting our monetization and product strategies accordingly. Encouragingly, our revenue mix is, as Sic said, becoming less top heavy, reflecting improved contribution from mid- and long-tail users. We have additional initiatives rolling out in the coming quarters that aimed at improving monetization efficiency under weak demand conditions. And the third factor, platform fundamentals. Since Q3 2025, we have seen a meaningful shift after multiple years of decline, paying users have returned to net growth, roughly -- I think we've been adding roughly 200,000 net adds per quarter. Retention metrics for both users and paying customers have also improved modestly. We see this as evidence that product optimization and user experience upgrades are working, particularly in expanding monetization beyond heavy standards. So if you put these 3 factors together and assuming no incremental regulatory tightening and broadly stable macro conditions, our baseline view for 2026 is First of all, full year revenue decline should be around low to mid-teens year-over-year. If you break the time line down, first half of '26 decline should decline in the mid-teens and perhaps the second half '26 would moderate meaningfully due to easier comps and improving fundamentals. So that's the outlook for '26. I think there is another question, which is when does the domestic business bottom? It's difficult to precisely call the bottom at this stage. However, based on the trajectory that we're seeing, like I said, we expect the year-over-year decline to moderate in the second half of '26. If the external conditions are stable by Q4 this year, we may narrow the year-over-year decline rate to below 10% if we are lucky. That said, the timing of a full bottom will depend significantly on, of course, macro recovery. Our current focus is on strengthening controllable fundamentals so that when macro stabilizes, we are positioned to return to growth. Back to Ashley for more questions. Ashley Jing: Operator next question, please. Operator: Your next question comes from Xueqing Zhang with CICC. Xueqing Zhang: My question is about overseas business. As you mentioned in your prepared remarks, the overseas business accelerated in 2025, mainly driven by the commercialization of new products in MENA regions as well as contribution from M&A consolidation. Could management share more color on the revenue contribution from MENA, specifically for audio and video products, new apps and SoulChill ? What kind of sales are we looking at for each of these? And how should we think about the growth trend of overseas revenue in 2026? Also has the recent geopolitical situation in the Mid East had any impact on the operations in the region? And lastly, considering the overseas business is still in the investment phase, what's the margin impact in 2026? And when do you expect overseas operations to start contributing meaningful profit? Sichuan Zhang: Thank you for the question. First, let's look at the big picture. Back in 2024, our overseas revenue was almost entirely driven by SoulChill and Tantan International. But in 2025 was a total breakout year for us. Our overseas revenue dropped more than 70%, hitting the RMB 2 billion mark. In terms of mix, SoulChill is still the heavy hitter. It brings in over half of our international revenue, but the real growth engine right now is our new MENA products, Yaha Live and Amar. They are scaling fast, and they will be the main drivers for us as we head into 2026. But it's not only just about the Middle East though, our other markets are also picking up serious speed. We have got Tantan International in Asia, MiraiMind in Japan and Happn, which started in Europe and is now moving into Turkey and South America. In 2026, we are focusing on going deeper into this market. We expect this dating segment to become our first largest revenue pillar right behind SoulChill and our new MENA app. Long term, we see massive potential there. The developed markets are more mature and stable. So we are staying fully committed to them for the long haul. As for the revenue trends and the final details for 2026, I will let Cathy walk you through the numbers. Cathy Peng: Okay. Let me break this down into 2 parts, growth trajectory of overseas business and profitability. With regards to the revenue growth outlook, unfortunately, it's a bit hard to give you a precise quantitative outlook for 2026 because as Sic said in her remarks, if you look at the overseas part of the business, it's a piece that spans across different markets, including both developing markets and developed markets. In addition, it also spans across different business sectors, including social entertainment and dating. -- each of these markets and sectors presents different growth dynamics and associated risks/ uncertainties. All of those make it hard to pin down a very precise outlook at the beginning of the year, specifically at the time when a lot of these business are still developing so fast. But what I can do is to try to sort of unpack the growth dynamics in each of the different sectors along the lines that are just outlined by Sic. In MENA area, we're -- what we are doing mostly involves social entertainment, SoulChill, which is our flagship brand has already surpassed RMB 1 billion revenue. As the base scales, growth rates will naturally moderate. Additionally, we also have to admit that some of our product and geographical expansion plans didn't progress as fast as we planned in 2025. So there is going to be a further slowdown in its growth in 2026, especially in first half. But in absolute terms, it will remain a meaningful contributor this year. At the same time, newer products such as Yaha Land and Amar are still in rapid expansion phase. Their continued scaling should be able to offset the moderation at SoulChill. With regards to the impact from the war, the Iran war, so far, the negative impact on our business is quite limited. However, if it becomes a prolonged conflict or keeps escalating, it certainly would have adverse effects on our business, especially our expansion plan into the Gulf countries and existing business in regions such as Saudi and perhaps Iraq as well. Outside MENA, our dating and AI-driven products in developed markets are gaining very strong traction. The AI-powered application MiraiMind is scaling quickly in Japan, and we are beginning to replicate that model in other markets. The various dating brands that we have are also growing -- are also growing stronger in their established markets. In 2026, we are also investing to expand our dating footprint in new markets as well. So overall, we expect the non-MENA piece to grow rapidly and reach a pretty sizable level in 2026. So if you take all of these together based on current run rate and expansion plans, we believe something like RMB 3 billion in overseas revenue for 2026 is a pretty achievable target, and that compares to around RMB 2 billion in 2025. So I would take that RMB 3 billion number as the baseline scenario, perhaps add in a couple of hundred millions as potential upside or downside depending on execution and the pace of geographical rollout. Now moving on to the second question, which is on profitability, when the -- specifically when the overseas business is going to turn profitable. Again, I don't want to sound too prescriptive on that because we are still early stage in our overseas development and facing so many different growth opportunities as well as associated uncertainties. But you're generally right in thinking that overseas remains in an investment phase. And I can perhaps talk more about where we are right now in terms of bottom line for our overseas business. And hopefully, by explaining how we manage the growth with financial discipline, we can help you form your own view about when we can expect overseas business to reach a breakeven point. At an operational level, overseas was loss-making in 2025, primarily due to continued investment in the 2 new MENA apps and AI-driven products. While we do not disclose segment level operating profit, directionally, the overseas operating should be roughly in the RMB 200 million range for 2025. That's my best estimate at this point. If you break things down among different applications, the picture is actually quite mixed. More mature apps such as SoulChill has long been profitable. Established dating brands are also profitable. But instead of trying to grow the profit, we are going to invest part of the profit into growing into new markets because we do believe these acquired brands have a lot of potential to be unleashed outside of their existing strongholds. Yaha Land and Amar are scaling rapidly and narrowing losses with clear payback visibility. We expect Yaha Land to turn profitable within this year and Amar should be behind it by half a year or so. The AI-driven product MiraiMind remains in investment mode as we prioritize user growth and product capability. We don't want to focus too much on reaching profitability for that product. But of course, for each of the region we are in, we also have a payback period that's required. On timing -- overall timing to profitability for the overseas piece, while I don't have a clear answer, here is the principle how we exercise financial discipline when talking about growing into various markets. Structurally, our internal requirement is that new products should achieve payback within either 1 to 3 years, depending on the maturity of the market and the business model. That means if we are -- if we were to moderate top line expansion, then we should see profits coming in sooner. However, as long as we see attractive new investment opportunities, be it new markets or new products, we are willing to reinvest to maximize long-term value creation. The key point is this, we are not pursuing growth at any cost. We are pursuing scalable -- only scalable growth with defined payback periods and disciplined capital allocation. I guess that's what I can say at this point about overseas profitability. Now back to Ashley for more questions. Ashley Jing: Next question, please operator. Operator: Your next question comes from Leo Chiang with Deutsche Bank. Leo Chiang: We had initially expected that adjustment in ratio in the second half together with the rising contribution from low-margin overseas audio and video business would drive a sequential decline in gross margin in Q4. However, Q4 gross margin held relatively stable and even came in slightly above management previous guidance of 36% to 37%. Should we interpret this as an indication that group gross margin in 2026 could remain broadly at the Q4 2025 level? My second question is management indicated that domestic revenue in 2026 is expected to decline year-over-year and low to mid-teens. while overseas revenue is projected to increase from RMB 2 billion to RMB 3 billion. Does this suggest that overall revenue for 2026 could be roughly flat? And given that overseas operations are still in the investment phase, could you provide us with some directional guidance on profitability for the 2026? Cathy Peng: Okay. I'll take this question. I'm hearing many questions. Firstly, on gross profit. And the second question is revenue at the group level. Third question is perhaps asking for guidance on the group level profit. So let me sort of flip the sequence of the question a little bit. Let me talk about group level revenue. Before that, I would like to throw out a disclaimer here that we do not really have visibility to give annual guidance on either top or bottom line at this point. So my comments below should be taken as a sort of a working assumption rather than firm targets, especially given uncertainties in both domestic macro environment and the pace of overseas expansion. With that in mind, here are how we think about 2026. On revenue, your math is broadly in line with how we are thinking about it. If we take the baseline assumption we previously discussed domestic business declining roughly low to mid-teens year-over-year and overseas revenue increasing from around RMB 2 billion in '25 to roughly RMB 3 billion in '26, then at the group level, a -- either a flattish or slightly downtick top line versus 2025 would be a reasonable baseline assumption. And then the question on gross margin, you're right that Q4 came in better than we had guided in Q3, and the outperformance mainly came from 2 areas. Number one is on the domestic side, we had expected to further compress margins by raising payout ratios to support agencies under tax scrutiny. In practice, we faced a payout increase in several rounds. And after the first 2 rounds, we saw motivation among agencies and broadcasters recover pretty strongly, more strongly than expected. As a result, we didn't need to deploy as many promotional incentives as originally planned. That helped domestic margin came in better than we had assumed. And second, on the overseas side, particularly in MENA region, we are starting to see operating leverage as revenue scales. Gross margin there improved faster than we initially modeled as well. So given those dynamics, I think it's reasonable to use Q4 gross margin as a reference point when thinking about '26. If overseas continues to scale as expected, that could be -- there could be some upside at the group level. However, I want to be careful not to over extrapolate one quarter, one specific quarter. There is still macro uncertainty domestically. And if we feel additional investment is needed to support the content partners and sustain revenue quality, we would be willing to do that. So at this stage, stability around the 2025 level feels like a prudent base case with potential variability on either side. And on the last question on profitability, if you look at operating expenses, personnel and marketing remain the 2 largest components. And here is my thinking along those lines. Because overseas markets are still in an investment phase, we do expect absolute engineering and personnel costs to increase slightly. But at the same time, we're going to continue to optimize some of the nonperforming businesses. So for R&D, currently, I'm thinking low single digits year-over-year. Marketing could grow in the somewhere around high teens range or 20-something percent. A lot of it -- I mean, how much we end up spending on marketing will depend on ROI in new markets. If certain regions are delivering strong returns, we may lean in more aggressively in that region. If returns are below expectations, we can dial back relatively quickly. So there is a building flexibility in our cost structure and how we manage revenue against marketing investments. Putting this together, if revenue is broadly flat and operating expenses growth at low teens, then on a reported basis, the bottom line will likely come in lower -- come in below 2025 levels. So if we were to frame it in margin terms in 2025, we delivered somewhere around 15% adjusted operating margin for '26. At this point of time, our internal objective is to keep the operating margin above 10%, likely in the low teens range. Overall, I would describe this year as a year where we are balancing profitability with disciplined investment. We see opportunities overseas, but we also want to maintain flexibility. So these assumptions reflect what we can see today with the understanding that we will adjust as conditions evolve. With that, I would like to turn back to Ashley for closing remarks. Ashley Jing: Yes. In the interest of time, I think we're going to call it a day, and thank you for joining us and see you next quarter. Operator: Thank you. That does conclude our conference for today. Thank you for participating. You may now disconnect. Before you buy stock in Hello Group, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Hello Group wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. 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As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool recommends Hello Group. The Motley Fool has a disclosure policy. Hello Group (MOMO) Q4 2025 Earnings Transcript was originally published by The Motley Fool

This article first appeared on GuruFocus. Total Revenue: RMB2.39 billion, down 5% year-over-year. Domestic Revenue: RMB1.79 billion, down 15% year-over-year. Overseas Revenue: RMB597 million, up 44% year-over-year. Adjusted Operating Income: RMB349 million, up 1% year-over-year with a margin of 14.6%. Non-GAAP Net Income: RMB328 million, compared to RMB403.8 million in the same period of 2025. Value-Added Services Revenue: RMB2.35 billion, down 6% year-over-year. Non-GAAP Gross Margin: 38.8%, compared to 37.9% from the year-ago period. Non-GAAP R&D Expenses: RMB165.2 million, representing a 11% decrease year-over-year. Non-GAAP Sales and Marketing Expenses: RMB335.4 million, representing 14% of total revenue. Cash and Cash Equivalents: RMB8.56 billion as of March 31, 2026. Net Cash Provided by Operating Activities: RMB158.9 million. Q2 Revenue Guidance: Estimated to be in the range of RMB2.45 billion to RMB2.55 billion. Warning! GuruFocus has detected 5 Warning Signs with MOMO. Is MOMO fairly valued? Test your thesis with our free DCF calculator. Release Date: June 02, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Overseas revenue increased by 44% year-over-year, accounting for 25% of total revenue compared to 16% last year. Adjusted operating income rose by 1% year-over-year with a margin of 14.6%. AI-driven innovations have improved user engagement and retention, particularly among female users. New overseas products are showing rapid growth, with some nearing profitability. The company is actively working on AI product innovations, which are expected to enhance user experience and drive long-term growth. Total group revenue decreased by 5% year-over-year, with domestic revenue down 15%. The company faced regulatory challenges in Turkey and geopolitical tensions in the Middle East, impacting overseas revenue. New tax regulations and stricter enforcement have negatively affected domestic revenue, particularly for Momo's entertainment business. Alipay's policy changes have led to a temporary decline in Tantan's membership renewals. The company expects a mid-teens percentage decline in domestic revenue for the full year due to regulatory and macroeconomic pressures. Q: Could the management provide more details on the challenges faced by the MENA business in Q1, and will this impact the full-year revenue outlook for the overseas business? A: The sequential revenue decline was due to three main factors: tightened regulations in Turkey affecting user acquisition, softer consumer sentiment during Ramadan, and ongoing conflicts in the Middle East. Despite these challenges, the business has begun to recover, and we remain confident in our full-year overseas revenue outlook. We expect our new MENA products to turn profitable soon, with Yahanlan reaching net profitability within a quarter and Mine about half a year behind. Q: When should we expect the external factors affecting domestic revenue, such as new tax rules and Alipay changes, to be fully digested? A: The impact of new tax regulations and stricter enforcement affected agency-related revenue, but we expect performance to normalize by Q3. The Alipay auto-renewal policy changes primarily impacted Tantan's membership business, with improvements expected in the second half of the year as we diversify payment channels and membership structures. Q: Could you share more about the group's AI product roadmap and its impact on long-term growth and profitability? A: AI is transforming user experience by enhancing connections and enabling new product formats. We are focusing on AI-assisted chat features and AI voice tools to lower social barriers. AI investment is high-return, directly improving user experience and driving higher propensity to pay. We will continue to expand AI's penetration across our products to maximize returns. Q: How should we think about the full-year domestic revenue outlook given the external challenges? A: The domestic revenue decline is expected to improve in the second half of the year as regulatory impacts normalize and the comparison base becomes easier. We now expect a mid-teens year-over-year decline for the full year, slightly adjusting from our previous low 10s decline guidance. Q: What is the profitability outlook for 2026, considering the challenges faced in the first half of the year? A: We expect a slight year-over-year decline in group revenue for 2026. Despite additional pressure from tax-related disruptions, we remain on track to achieve our adjusted operating margin target in the low 10s. We are optimizing spending to improve productivity without affecting long-term growth initiatives. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Image source: The Motley Fool. Tuesday, June 2, 2026 at 8 a.m. ET Chief Executive Officer — Tang Yan Chief Operating Officer — Zhang Sichuan Chief Financial Officer — Peng Hui Investor Relations Director — Ashley Jing Operator: Ladies and gentlemen, thank you for standing by, and welcome to Hello Group's First Quarter 2026 Earnings Conference Call. [Operator Instructions] Please note, this conference is being recorded today. I would now like to hand the conference over to your first speaker today, Ms. Ashley Jing. Thank you. Please go ahead, ma'am. Ashley Jing: Thank you, operator. Good morning and good evening, everyone. Thank you for joining us today for Hello Group's First Quarter 2026 Earnings Conference Call. The company's results were released earlier today and are available on the company's IR website. On the call today are Mr. Tang Yan, CEO of the company; Ms. Zhang Sichuan, COO of the company; and Ms. Peng Hui, CFO of the company, who will discuss the company's business operations and highlights as well as the financials and guidance. They will all be available to answer your questions during the Q&A session that follows. Before we begin, I would like to remind you that this call may contain forward-looking statements made under the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Such statements are based on management's current expectations and current market and operating conditions and relate to events that involve known, unknown risks, uncertainties and other factors, all of which are difficult to predict and many of which are beyond the company's control. which may cause the company's actual results, performance or achievements to differ materially from those in the forward-looking statements. Further information regarding this and other risks, uncertainties and factors is included in the company's filings with the U.S. Securities and Exchange Commission. The company does not undertake any obligation to update any forward-looking statements as a result of new information, future events or otherwise, except as required under law. I will now pass the call over to our COO, Ms. Zhang Sichuan. Ms. Zhang, please? Sichuan Zhang: Thank you, Ashley. Hello, everyone. Thank you for joining today's call. The group maintained steady business momentum in Q1 guided by the strategic priorities that last year. Our domestic business a healthy through focused product innovation and refined operations despite external pressures leveraging the synergy of a diversified product portfolio, our overseas business has remained a positive trend. Looking ahead, we have full confidence in each business line to continue to advance along the strategic road map in 2026. Now I'll walk you through the key updates. Starting with the financials. For Q1 '26, total group revenue was RMB 2.39 billion, down 5% year-over-year. Domestic revenue reached RMB 1.79 billion, down 15% year-over-year. Overseas revenue was RMB 597 million, up 44% year-over-year. Overseas revenue accounted for 25% compared to 16% in the same period last year. Adjusted operating income was RMB 349 million, up 1% year-over-year with a margin of 14.6%. Building on the strategic direction from 2025, our '26 priorities continue along 3 main tracks. For Momo, the growth is still ensuring stable sustained productivity of our cash cow business. For Tantan, to continue exploring updating experience and efficient business model tailored for Asian users. And for our new business, to different overseas presents enrich our brand portfolio and build a long-term growth engine. Let me walk you through each. Starting with Momo. On the product side, our key focus in recent years has been to optimize user experience and stabilize our user base. This year, we have continued to refine the track experience. Our network feature improves connection [indiscernible] by analyzing users historical check patterns to optimize matching algorithm. Driving sustained growth in 2A and [indiscernible]. In real-time check scenario, building on a steady ramp-up of voice features, we have also introduced video features to enrich our portfolio of instant interactions. The combined upgrades in Argo recommendation and product experience has lowered the barrier for users to [indiscernible]. This is the main driver behind the steady improvement in retention among existing users. In tenure, we undertook a number of meaningful installations in leveraging AI to improve users' social efficiency with encouraging initial results. For example, our AI buildings and AI chat assist features improve the female users experience. This drove higher [indiscernible] from male users and more in-depth conversation overall. In Q1, the product team explored AI-driven innovations such as voice [indiscernible], guiding users complete voice profiles. Also generating voice content and releasing it on to the platform in a message in the [indiscernible] format to spot users desire to connect. For user acquisition, China ROI has remained fully profitable since the beginning of the year. Ongoing audio room, game plan updates and better channel conversions lifted payment intent among net and small spending users. This drove study or TV growth and channel ROI improved model quarter-over-quarter. Overall, acquisition spend continue the refined disciplined approach narrowing slightly from last quarter. This is worth noting that Q1 was affected by the Chinese New Year as some users shifted their [indiscernible] offline gathering and close friends and family. This temporary pullback platform activity and paying scale with Momo's paying users decreasing by RMB 200,000 quarter-over-quarter to RMB 3.7 million. That's thanks to a year of product refinement focus on chat experience, organic traffic grew compared to last year and retention among existing users improved slightly. Turning to Chinese New Year, the team ran targeted operational events at a low point of the cycle, narrowing the decline in user activities compared to last half holidays. As a result, the post-holiday recovery was meaningfully better than in the same period last year. This set a solid foundation for stabilizing our user base over the full year. Turning to more commercial performance. In Q1, Momo's glass revenue was RMB 1.52 billion, down 15% year-over-year. and 9% quarter-over-quarter. The year-over-year decline mainly reflects the ongoing impact of the new tax regulations and stricter local enforcement that came into effect in the second half of '25. The motivation of some high grossing agencies and broadcasters is still recovering. The [indiscernible] decline was largely seasonal, driven by the Chinese New Year alongside persistently soft consumer spending sentiment. In response to these external shift, the teams continue to direct gameplay innovation and operational resources towards mid-tier and long-tail users giving revenue from audio scenarios and social games such as parking was relatively resilient. This has partially absorbed the external pressure on overall revenue. On the product and operations side, our live streaming business organized a series of user-oriented events during the Chinese New Year effectively cushioning the demotion of online behavior from the long holiday. As a result, the post-holiday recovery in key operational metrics, including user engagement paying conversion rate and streamer return rate was meaningfully stronger than in the same period last year. At the same time, we continue to introduce and selectively support high-quality talent streamer, lifting organic revenue through content quality improvements. In audio scenario, we roll out the new PA game play to further motivate users to give one another. With some mid-tier and non-car broadcasters and agencies on our platform facing ongoing profit pressure during the test combining process, we have rolled out new incentive base revenue sharing policy. This has decided to enable the quality performance to deliver greater value to the platform while ensuring their sale of the mixed stable income in turn. Now let's turn to Tantan. As of the end of Q1, Tantan had 0.6 million paying users a modest decrease of 30,000 quarter-over-quarter. This decline was driven by 2 factors. First, the carryover from ongoing MAU decline and second, Alipay changes through its ultra renewal paying rules, billing rules, which placed short-term pressure on our membership conversion. Under the continued factor of our strategic marketing cuts, content user base remain on the downward trajectory through so the magnitude of the client was has narrowed meaningfully through algorithm innovation and refined operations, engagement and retention among younger users show slight improvement contributing positive to user base stability. On the product side, the team optimized recommendation strategies in our core wet-based scenario. For example, we introduced her restrictions on female users metrics, allowing only [indiscernible] or upward matching a benefit for female users, we will show expectations. This drove a near 3 percentage point increase in average swipe or female user [indiscernible] improving the retention. On new scenario in portion, we piloted MAC-based [indiscernible] and AI chat assist features. Our user acquisition alter the year-over-year reduction in China investment led to a lower required volume. The meaningful narrowing the unit acquisition costs, partially [indiscernible] Additionally, because organic traffic outperformed channel traffic on both user engagement and retention, the overall decline in our user base has far smaller than the channel-driven decline implied by our strategic up. Sequentially, both spend and user acquisition costs narrowed by various degrees. So the China volume decline was relatively limited. While Alipay will policy created near-term ARPU pressure. Channel [indiscernible] was sustained well above 100% throughout the quarter. On the financial side in Q1, Tantan's domestic business generated RMB 125 million in revenue, down 25% year-over-year and 8% quarter-over-quarter. The primary driver remains MAU construction leading the fewer paying users compounded by the short-term impact of Alipay's policy adjustments on [indiscernible] payments. On monetization, the team unbundled membership issues into [indiscernible] card offerings while enriching fresh chat game plan and stepping up in app promotion to ease top line pressure. On profitability, thanks to ongoing cost in channel investment and personnel costs Net profit grew significantly year-over-year. Lastly, our new businesses. Our 2026 gold carries forward from '25 to deepen our overseas presence in which our brand portfolio and our long-term growth engine. In Q1, overseas revenue totaled RMB 597 million, up 44% year-over-year with a slight 2% sequential decline. Overseas now accounted for 25% of group revenue compared to 16% in the same period last year. The sequential softness was mainly due to some external challenges so to pace during the quarter, which rated on our overseas business overall. Excluding SoC, the rest of our overseas businesses continue to deliver healthy growth this quarter. Further validating the value of diversified product portfolio in this sensing risk from a single product volatility. Our 2 new product in [indiscernible] continue their rapid growth trajectory with both delivering triple-digit revenue growth year-over-year in Q1, driven by continuously improving localized operations a more precise scraps of local user preferences and sustain game plan innovation, both products of concurrent improvement in revenue and profit. This quarter, Yahoo is approaching net income breakeven, and Amar achieved positive marginal contribution for the first time. This is a significant milestone making our shift in MENA from a social dominated model to a multiproduct portfolio. Beyond our audio and video social products in MENA region, our dating business focused on developed markets is another important pillar of our overseas footprint, also deliver satisfying progress this quarter. Tantan International, met by our Singapore team completed a full upgrade of product positioning and branding over the past year. And in second half of '25, began migrating from share domestic international app built to [indiscernible] overseas. The migration was completed in Q1 with 99% of paying users successfully transferred, minimizing the revenue impact of the version speed. Starting in Q2. The team's focus is try to further optimizing product experience and improving monetization efficiency separately, happen, which down the group last year has continued a steady healthy growth trajectory since the beginning of this year. Happens user base has remained relatively stable over the past year and both sequential and the year -- our year-over-year revenue growth came mainly from improvements in paid conversion rate and people, reflecting greater efficiencies in operating the existing user base. In Q1, we began testing happens entry into new markets, laying the foundation for the brand's mid- to long-term growth. As a voluntary newer segment for our overseas funds, we remain confident in the dating businesses, continued release of growth potential in 2006. This concludes my remarks. Now let me pass the call to Cathy for the financial review. Cathy, please. Cathy Peng: Thanks, Sic. Hello, everyone. Thank you for joining our conference call today. Now let me take you through the financial review. Total revenue for the first quarter 2026 was RMB 2.39 million, down 5% year-on-year and 7% quarter-over-quarter. Non-GAAP net income attributable to the shareholders of the company was RMB 288 million compared to RMB 403.8 million in the same period of 2025 and RMB 281.3 million in the previous quarter. Looking into the key revenue items for Q1. Total revenue for value-added services for the first quarter of 2026 was RMB 2.35 billion, down 6% year-on-year and 7% quarter-on-quarter. On a geographic basis, PRC Mainland value-added service revenue was RMB 1.76 billion, down 15% year-over-year and 9% quarter-over-quarter. The decrease was primarily due to heightened tax scrutiny on the agencies for Momo's Entertainment business, combined with softened consumer sentiment amid broader macro pressures and, to a lesser degree, a decline in paying users on Tantan. BaaS overseas revenue reached RMB 593.7 million, up 44% year-over-year driven by the rapid expansion of our diversified product portfolio. Overseas VAS revenue decreased slightly by 2% sequentially due to seasonal factors, namely Ramadan as well as some external challenges in MENA area during the quarter. Turning to cost and expenses. Non-GAAP cost of revenue for the first quarter of 2026 was RMB 1.46 billion, compared to RMB 1.57 billion for the same period last year. Non-GAAP gross margin for the quarter was 38.8% compared to 37.9% from year ago period. Gross profit margin, or GPM, in Q1 '26 rose by around 1 percentage point Y-o-Y. The increase was primarily driven by improved margins in MENA products after lowering the revenue sharing ratio to promote quality growth, together with a greater revenue mix from higher-margin overseas staining products. This was partially offset by a decline in Momo's GPM resulted from increased payout ratio to agencies in order to cushion the impact from the tax scrutiny. Non-GAAP R&D expenses for the first quarter was RMB 165.2 million compared to RMB 185.9 million for the same period last year, representing an 11% decrease Y-o-Y. The decrease was due to overall labor cost savings from the optimization of our personnel structure. Non-GAAP R&D expenses as a percentage of revenue was 7% same as Q1 last year. We ended the quarter with 1,396 total employees compared to 1,336 from a year ago. The R&D personnel as a percentage of total employees for the group was 56% compared with 58% from Q1 last year. Non-GAAP sales and marketing expenses for the first quarter was RMB 335.4 million compared to RMB 22.1 million for the same period last year, representing a 14% and 13% of total revenue, respectively. The year-over-year increase in sales and marketing expenses was mainly driven by increased marketing investments in our new overseas apps. This was partially offset by continued cost control in our PRC Mainland operations as both Momo and Tantan reduced marketing spend while Soulchill also temporarily scaled back channel investments amid external challenges. Non-GAAP G&A expenses was RMB 89.4 million for the first quarter compared to RMB 114.8 million for the same period last year, representing a 4% and 5% of total revenue, respectively. The decrease in G&A expenses was primarily attributable to a high base effect in Q1 '25, resulting from a self-inspection related to tax matters. Non-GAAP operating income was RMB 349.2 million representing a margin of 14.6% compared with RMB 345.3 million and a margin of 13.7% from Q1 '25. The increase was driven by improvement in GP non-GAAP OpEx as a percentage of total revenue stood at 25%, unchanged from the year ago period. Now briefly on income tax expenses. Total non-GAAP income tax expenses was RMB 81.5 million for the quarter with an effective tax rate of 20%. In Q1, the company accrued withholding tax withholding income tax of RMB 21.2 million, which is 10% of undistributed profit generated by our ROFE. Without a withholding tax, our estimated non-GAAP effective tax rate was around 15% in the first quarter. Now turning to balance sheet and cash flow items. As of March 31, 2026, Hello Group's cash, cash equivalents, short-term deposits, long-term deposits from investments and restricted cash totaled RMB 8.56 billion compared to RMB 8.68 billion as of December 31, 2025. Net cash provided by operating activities in the first quarter of 2026 was RMB 158.9 million. The difference between operating net cash and non-GAAP net income was mainly due to a significant increase in accounts receivable caused by temporary payment collection delays on one of our apps as well as higher other current liabilities from the accrual of year-end bonuses and the 13-month payroll. Lastly on business outlook. We estimated our second quarter revenue to come in the range from RMB 2.45 billion to RMB 2.55 billion, representing a decrease of 6. 1 -- I'm sorry, 6.5% to 2.7% year-on-year. This is based on the assumption that at midpoint on a year-over-year basis, revenue from our Mainland China business will decline by high teens percentage-wise while overseas revenue is expected to grow by high 50s percentage wise. Please be mindful that this forecast represents the company's current and preliminary view on the market and operational conditions, which are subject to change. That concluded our prepared portion of today's discussion. With that, let me turn the call back to Ashley to start Q&A. Ashley, please. Ashley Jing: [Operator Instructions] Operator, we're ready for questions, please. Thank you. Operator: [Operator Instructions] Your first question today comes from Xueqing Zhang with CICC. Xueqing Zhang: [Foreign Language] My question about the overseas business. Regarding the [indiscernible] prepared remarks, the [indiscernible] challenges from external factors in the first quarter. Management provide more details on what happened and will this have an impact on the full year revenue abroad for the overseas business. In addition, she also mentioned that the 2 new products continue to see revenue growth, while the losses kept narrowing. So could management share on this new business to turn profitable. Going forward, will the company continue to increase marketing investment to scale these products or will you focus more on narrowing losses and moving to our profitability? Unknown Executive: [Foreign Language] Ashley Jing: Let me start with [indiscernible] in Q1. So the sequential revenue decline came down to 3 main things. Number one is the Turkish government tightened regulation on social and streaming apps which temporarily resulted in a blanket removal of all related products across the industry. That created a headwind for us in terms of user acquisition in Turkey. And number 2 is a consumer sentiment in the MENA region doing Ramadan was relatively softer. As a large and rather mature product, Socio was more noticeably impacted by this seasonal kind of [indiscernible] and number 3 is the ongoing complex in the Middle East. That has also had some drag on Social's revenue in the Gulf region. Unknown Executive: [Foreign Language] Ashley Jing: We are confident that [indiscernible] compliance with all applicable Turkish laws and regulations governing social platforms. Our team is actively working with the relevant authorities to bring the app back to the app store as soon as possible. In the meantime, we are accelerating localization efforts in other markets to offset the temporary impact from Turkey. So thus business has already begun to see a steady recovery from the Q1 low, and we do not believe investors need to be overly concerned about it. Unknown Executive: [Foreign Language] Ashley Jing: So the [indiscernible] manner products had a strong triple-digit year-over-year revenue growth with losses narrowing rapidly. As the business has scaled, the team has been able to gradually adjust the revenue sharing structure, driving meaningful and sustained gross margin improvement over the past year and we have selectively increasing marketing spend where ROI targets are being met and actively testing markets while keeping the losses -- the loss trajectory moving in the right direction each quarter. Our path for these 2 [indiscernible] products is pretty clear, build scale first. Optimize the gross margin structure, keep marketing ROI driven and net profitability flow naturally. [indiscernible] should keep net profitability within a quarter [indiscernible] about half a year behind on that trajectory. And for the full year overseas revenue outlook, I will hand it over to Cathy. Cathy Peng: Let me first break the overseas I'll walk into 3 separate pieces. First is our flagship overseas app, Social. As [indiscernible] mentioned earlier, Soulchill was under some pressure in Q1, mainly due to regulatory changes in Turkey as well as the prolonged geopolitical tensions in parts of the Middle East. That said, I think the team has adapted reasonably well to the changing environment. While revenue in Turkey remained somewhat pressured, performance in other Middle East -- other Middle Eastern markets has actually been quite solid. So overall, I would say that social particularly in the first half of the year is likely to come in a bit below our original expectations. But the business itself remains fundamentally healthy. And the -- if you look at the second piece, for the 2 newer social entertainment apps, we've been scaling in the MENA region, their trends are actually developing very much in line with our plans. And third, for the dating a membership-oriented business outside of the MENA region, that part of the portfolio has remained very much on track. And honestly, that's one of the things that makes stating our membership business model pretty attractive compared with entertainment-driven platforms, the revenue visibility and forecasting clarity are generally much higher. So putting these 3 pieces together, if you recall what we said on the last earnings call, we mentioned that overseas revenue for 2025 was, I think, somewhere around RMB 2 billion. This year, for 2026, we are likely to hit RMB 3 billion milestone. At this point, our overall view really hasn't changed materially depending on how market expansion progresses across different regions, there could still be somewhere around RMB 100 million variation either to the upside or to the downside of that RMB 3 billion number. But based on what we see today, we remain pretty comfortable with that original range. So hopefully, that answers your question. Back to Ashley for questions. Ashley Jing: Operator, next question, please. Operator: Our next question comes from Thomas Chong with Jefferies. Thomas Chong: [Foreign Language] In Q1, we saw domestic revenue declined by 15% year-on-year and year-on-year decline widened versus 2025. Management comments, this is related to the new tax rules which affects Momo. May I understand when should we expect these external factors to be fully digested. On the other hand, management comments Alipay automatic renewal has some changes which need to short-term impact to Tantan paying conversion. Can management comment about the scope for this adjustment? And how long did it last? And should we expect this will affect Momo and other subscription products as well? Lastly, how should we think about the full year outlook for the domestic revenue? Unknown Executive: [Foreign Language] Ashley Jing: So let me first address the impact of tax policies on Momo. I mean new tax regulations introduced in the second half of 2025, combined with stricter local tax collection and enforcement of affected agency's operating chatroom scenario to elevate the pressure on the supply side, we moderately adjusted the revenue sharing ratios for key agencies in the latter half of last year, which yield positive results for those impacted. However, tax authorities further tightened the policies targeting agencies in early 2026, resulting in a decline in agency-related revenue during March and April. . In response, we selected a group of high-quality agencies in May and began assisting them with tax compliance to help offset the profit pressure caused by additional compliance costs, we introduced a new incentive program and provided further financial support to these selected agencies. And since late May, both operational enthusiasm and revenue among these agencies have rebounded actually rapidly. We expect their performance to return to normal level by Q3. Unknown Executive: [Foreign Language] Ashley Jing: So as for when Momo Vas will return to year-over-year growth, beyond the tax issue, it also depends on when broader consumer sentiment picks back up. What we can control is making sure the product fundamentals are rock solid and operating efficiency is maximized. And we are very confident in Momo's modernization capabilities. Unknown Executive: [Foreign Language] Ashley Jing: So on the auto renewal -- Alipay auto renewal policy changes, yes, this did impact Tantan's membership business primarily manifesting as the temporary decline in renewal rates and resulting in some subscriber churn. Team actually responded swiftly. On the monetization side, we launched an unbundling strategy, separating high-frequency pubs that were previously bundled into membership packages such as super likes and booths and offering them as a stand-alone purchases. And we have also enhanced our [indiscernible] features like FlashChat to help offset headwinds in membership renewals. In addition, we are diversifying payment channels, encouraging users to shift towards less affected options and promoting longer-term membership plans. Unknown Executive: [Foreign Language] Ashley Jing: So in terms of scope, the Alipay policy changes primarily affected subscription or membership products. Momo's core payment model is based on consumable virtual gifts which do not rely on auto renewal. So the impact is actually quite minimal. Our overseas business uses up store or Google Play payment channels, which remain unaffected. Overall, this is a relatively contained issue, primarily impacting only Tantan's domestic membership business. On timing, we expect the impact to be concentrated in the first half of the year with the situation gradually improving in the second half as we diversify payment channels and membership structures. So for the full year domestic revenue outlook, I will hand it over to Cathy. Cathy Peng: Okay, time for an update on how we are thinking about the revenue outlook for the rest of 2026. I will, as in previous quarters, used the same framework, which is set upon 3 key elements. The macro environment, the regulatory environment and our own platform fundamentals along those lines, starting with the macro side, honestly, consumer sentiment looks largely unchanged from what we saw at the end of last year and through Q1, it remains relatively soft. But importantly, we are not seeing any meaningful deterioration either. On the regulatory front, this is really where most of the incremental pressure came from in Q1 and Q2. You are right. that the year-over-year decline in Q1 widened versus last year. And if you look at our Q2 guidance, the domestic revenue decline is expected to widen further from Q1's level. The main reason is tighter tax scrutiny on some of the small- and medium-sized agencies in our ecosystem, which hit March, April and early May, particularly hard. In response, we rolled out new agency incentive policies to encourage tax compliance. The goal here is very straightforward. We want to maintain the long-term health and stability as the content ecosystem and continue supporting the agencies that create the most value on the platform. Since rolling out these measures in late May, we've already started seeing encouraging feedback and some improvement in operating trends and we do expect June performance to benefit from these adjustments. That said, April and May were clearly impacted by the tightened regulatory environment and that pressure is reflected in our Q2 guidance. Some of the impact could still carry into Q3. But at this stage, we believe the most difficult period is likely behind us already. Now turning to platform fundamentals. As Sic mentioned in the prepared remarks, the core business itself remains very solid. So outside of the regulatory pressure, there really hasn't been any material change in the underlying business fundamentals compared with what we saw in Q1. Looking into the second half of the year, we still expect the year-over-year decline rate to narrow meaningfully. Part of this is because the regulatory impact should gradually normalize as the year progresses. And part of it is simply because the comparison base become significantly easier in the second half of 2025. So for the second half, we still expect the domestic business decline rate to improve to somewhere below 15% year-over-year. That said, given the additional disruption that we saw in the first half from tax tightening. We are modestly adjusting our full year outlook -- full year outlook. Previously, we were guiding to a low teens decline for the domestic business. Based on what we see so far happened in the first half, we now expect the full year decline to be closer to somewhere around mid-teens year-over-year. So that's how we are currently thinking about the domestic revenue outlook back to Ashley, maybe for one more question. . Ashley Jing: Yes. So in the interest of time, let's just take one last before we close the line, and we're ready. Thank you, operator. Operator: Your next question comes from [indiscernible] with UBS. Unknown Analyst: [Foreign Language] [indiscernible] System futures to newly launched AI voice [indiscernible] quarter. So could you please share more details on the group's AI product road map going forward? And more broadly, how do you view the contribution of innovation to our longer-term earnings growth? And should we expect any nice impact on near-term profitability from AI investments? And given the external [indiscernible] domain overseas business at [indiscernible] how do we assess the group's full year prospect or [indiscernible] Unknown Executive: [Foreign Language] Ashley Jing: AI is particularly meaningful for a company like ours where social products are the core. On the essence of our product features and recommendation logic is to lower the barriers for users to for connections and enable long-term and effective interactions and deliver emotional value. AI that can genuinely transform the user experience in this space. Unknown Executive: [Foreign Language] Ashley Jing: Based on what we have built so far, AI is advancing in 2 distinct directions on the product side. And first, enhancing connections between users by breaking the eyes and lowering social areas. Examples include our AI-assisted chat features and the AI voice drift bottle, which we are currently testing. The concept is that AI guys users to provide basic profile information through voice input and then automatically generates more vivid and engage in self-introduction and greetings using the user's actual voice. And this is then published on the platform as a gift bottle. So these AI tools are particularly valuable for users who have dating needs but relatively weaker social skills. And second, enabling new product formats. For example, like Donut is fully AI-powered voice social products that has already begun monetization in China. And on the overseas side, our AI role play dating app, [indiscernible], has shown solid early traction in Japan and is now expanding to other Asian markets. And these products represent our exploration of what next-generation social experience can look like. Unknown Executive: [Foreign Language] Ashley Jing: Regarding the impact of AI investment on profitability, our view is that AI spending is high return in nature. It directly improves user experience and drives higher propensity to pay. From an execution standpoint, AI penetration across our products is still in a rapid expansion phase. Over the past year, we focused on refining the AI greeting and AISC chart algorithm on the Momo platform. Going forward, we will be replicating that tax at across more use cases. including AI agents for Momo live streaming, AI shop dramas generation based on broadcasters images as well as smart matching and content distribution [indiscernible] and AI-assisted chatting features. This kind of horizontal reuse of the Tax Act helps maximize the return on investment for the group's profitability outlook, I will pass it over to Cathy. Cathy Peng: Okay. On profitability outlook. I will just go back to the framework that we laid out at the beginning of the year on our March earnings call. Starting from the top line, if you combine our updated view on the domestic business with what I just discussed on the overseas side, we now expect group revenue for 2026 to see a slight year-over-year decline versus 2025, probably down by a couple of percentage points at the top level. At the beginning of the year, we also said that we were targeting adjusted operating margin in the low teens. And based on what we see today, that target still looks quite achievable. That said, because the domestic business faced additional pressure from the tax-related disruption in Q1 and the early part of Q2, our full year revenue outlook in absolute dollar terms is now somewhat lower than where we started the year. naturally, that creates more pressure in terms of absolute profit amount. So internally, we are looking at additional opportunities to optimize spending wherever appropriate and necessary, whether on personnel side, marketing efficiency or other operating areas where we believe we can improve productivity without affecting long-term growth initiatives. So overall, I would say that we remain broadly on track to achieve the profitability targets that we laid out at the beginning of the year. So I think that wraps up the call. Now I'm handing back to Ashley for closing remarks. Ashley Jing: Well, so thank you for participating today, and that's going to be the end of the call, and we will see you next quarter. Thank you. Bye. Operator: Thank you. That does conclude our conference for today. Thank you for participating. You may now disconnect. Before you buy stock in Hello Group, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Hello Group wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $462,983!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,375,447!* Now, it’s worth noting Stock Advisor’s total average return is 995% — a market-crushing outperformance compared to 212% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of June 2, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool recommends Hello Group. The Motley Fool has a disclosure policy. Hello Group (MOMO) Q1 2026 Earnings Transcript was originally published by The Motley Fool

BEIJING, May 11, 2026 /PRNewswire/ -- Hello Group Inc. (NASDAQ: MOMO) (the "Company"), a leading player in Asia's online social networking space, today announced that it will release its unaudited financial results for the first quarter ended March 31, 2026 before U.S. markets open on Tuesday, June 2, 2026. Hello Group's management will host an earnings conference call on Tuesday, June 2, 2026, at 7:00 a.m. U.S. Eastern Time (7:00 p.m. Beijing / Hong Kong Time on the same day). Preregistration Information Participants can register for the conference call by navigating to https://s1.c-conf.com/diamondpass/10054808-suvwn2.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 June 10, 2026. The dial-in details for the replay are as follows: 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 Asia's online social networking 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 we added to 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. Since 2019, we have continuously expanded our portfolio through internal incubation and strategic acquisitions, adding apps such as Hertz, Soulchill, and Happn. These products target more niche markets and selective user demographics both domestically and internationally, further strengthening our global presence. For investor and media inquiries, please contact: Hello Group Inc. Investor Relations Phone: +852-3157-1669 Email: [email protected] Christensen In China Ms. Xiaoyan Su Phone: +86-10-5900-1548 E-mail: [email protected] View original content:https://www.prnewswire.com/news-releases/hello-group-to-report-first-quarter-2026-results-on-june-2-2026-302768030.html