BEIJING, March 14, 2024 /PRNewswire/ — Hello Group Inc. (NASDAQ: MOMO) (“Hello Group” or the “Company”), a leading mobile social and entertainment platform in China, today announced its unaudited financial results for the fourth quarter and the full year ended December 31, 2023.  

Fourth Quarter of 2023 Highlights

  • Net revenues decreased by 6.5% year over year to RMB3,002.9 million (US$423.0 million*) in the fourth quarter of 2023.
  • Net income attributable to Hello Group Inc. increased to RMB452.5 million (US$63.7 million) in the fourth quarter of 2023, from RMB398.0 million in the same period of 2022.
  • Non-GAAP net income attributable to Hello Group Inc. (note 1) increased to RMB514.7 million (US$72.5 million) in the fourth quarter of 2023, from RMB487.9 million in the same period of 2022.
  • Diluted net income per American Depositary Share (“ADS”) was RMB2.32 (US$0.33) in the fourth quarter of 2023, compared to RMB2.01 in the same period of 2022.
  • Non-GAAP diluted net income per ADS (note 1) was RMB2.63 (US$0.37) in the fourth quarter of 2023, compared to RMB2.46 in the same period of 2022.
  • Monthly Active Users (“MAU”) on Tantan app were 13.7 million in December 2023, compared to 18.4 million in December 2022.
  • For the Momo app total paying users was 7.4 million for the fourth quarter of 2023, compared to 7.8 million for the same period last year. Tantan had 1.2 million paying users for the fourth quarter of 2023 compared to 1.7 million from the year ago period.

Full Year 2023 Highlights

  • Net revenues decreased by 5.5% year over year to RMB12,002.3 million (US$1,690.5 million) for the full year of 2023.
  • Net income attributable to Hello Group Inc. was RMB1,957.6 million (US$275.7 million) for the full year of 2023, compared to RMB1,484.3 million during the same period of 2022.
  • Non-GAAP net income attributable to Hello Group Inc. (note 1) was RMB2,224.7 million (US$313.3 million) for the full year of 2023, compared to RMB1,885.8 million during the same period of 2022.
  • Diluted net income per ADS was RMB9.84 (US$1.39) for the full year of 2023, compared to RMB7.31 during the same period of 2022.
  • Non-GAAP diluted net income per ADS (note 1) was RMB11.17 (US$1.57) for the full year of 2023, compared to RMB9.20 during the same period of 2022.

“2023 was a busy, yet fruitful year. Despite many changes and challenges in the external environment, our team made steady progress against our strategic priorities.” Commented Yan Tang, Chairman and CEO of Hello Group. “With solid improvement in cost efficiency, we were able to meaningfully improve the profitability of the company against economic headwinds. I am also pleased to see that our new endeavors in the overseas market have started bearing fruits, which gives us more confidence to invest more resources and take bigger strides to explore wider markets abroad.”

* This press release contains translations of certain Renminbi amounts into U.S. dollars at specified rate solely for the convenience of readers. Unless otherwise noted, all translations from Renminbi to U.S. dollars, in this press release, were made at a rate of RMB7.0999 to US$1.00, the effective noon buying rate for December 29, 2023 as set forth in the H.10 statistical release of the Federal Reserve Board.

Fourth Quarter of 2023 Financial Results

Net revenues

Total net revenues were RMB3,002.9 million (US$423.0 million) in the fourth quarter of 2023, a decrease of 6.5% from RMB3,212.7 million in the fourth quarter of 2022.

Live video service revenues were RMB1,523.9 million (US$214.6 million) in the fourth quarter of 2023, a decrease of 11.6% from RMB1,724.2 million during the same period of 2022. The decrease was primarily attributable to a soft consumer sentiment in the current macro environment and our proactive operation adjustments to de-emphasise large scale competition events in the Momo app, and to a lesser degree, Tantan pivoting away from the less dating-centric live video service.

Value-added service revenues mainly include virtual gift revenues and membership subscription revenues. Total value-added service revenues were RMB1,424.9 million (US$200.7 million) in the fourth quarter of 2023, a decrease of 1.7% from RMB1,449.5 million during the same period of 2022. The decrease was primarily due to the impact of the macro economy on consumer sentiment as well as our product adjustments to improve Momo app’s ecosystem, and to a lesser extent, the decline in Tantan’s paying users that resulted from a reduction in channel investment, the anti-spam campaign and the adjustments to subscription renewals. The decrease was partially offset by the rapid revenue growth from the new standalone apps.

Mobile marketing revenues were RMB44.9 million (US$6.3 million) in the fourth quarter of 2023, an increase of 36.4% from RMB32.9 million during the same period of 2022.

Mobile games revenues were RMB5.4 million (US$0.8 million) in the fourth quarter of 2023, an increase of 2.4% from RMB5.3 million in the fourth quarter of 2022.

Net revenues from the Momo segment decreased from RMB2,865.8 million in the fourth quarter of 2022 to RMB2,728.7 million (US$384.3 million) in the fourth quarter of 2023, primarily due to the decrease in net revenues from value-added service and live video service on Momo app. The decrease was partially offset by the revenue growth of the new standalone apps. Net revenues from the Tantan segment decreased from RMB346.7 million in the fourth quarter of 2022 to RMB272.2 million (US$38.3 million) in the fourth quarter of 2023, mainly due to the decrease in net revenues from live video service, and to a lesser extent, the decrease from value-added service.

Cost and expenses

Cost and expenses were RMB2,431.8 million (US$342.5 million) in the fourth quarter of 2023, a decrease of 11.2% from RMB2,738.3 million in the fourth quarter of 2022. The decrease was primarily attributable to: (a) a decrease in revenue sharing with broadcasters related to live video service on the Momo app and on the Tantan app, and a decrease in revenue sharing with virtual gift recipients of virtual gift service on the Momo app. The decrease was partially offset by an increase in revenue sharing with virtual gift recipients for new standalone 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; (c) a decrease in sales and marketing expenses due to our initiatives to control cost and optimize Tantan’s channel marketing strategy and, to a lesser extent, Momo’s strategy to trim inefficient channel marketing spend.

Non-GAAP cost and expenses (note 1) were RMB2,369.5 million (US$333.7 million) in the fourth quarter of 2023, a decrease of 10.5% from RMB2,648.3 million during the same period of 2022.

Other operating income (loss), net

Other operating income was RMB30.8 million (US$4.3 million) in the fourth quarter of 2023, compared to a loss of RMB65.2 million during the fourth quarter of 2022. The other operating loss in the fourth quarter of 2022 mainly included a contingent loss accrual of RMB92.9 million related to an ongoing investigation of the alleged illegal activity on the source of the funding consumed on Momo’s platform.

Income from operations

Income from operations was RMB602.0 million (US$84.8 million) in the fourth quarter of 2023, compared to RMB409.2 million during the same period of 2022. Income from operations of the Momo segment was RMB576.9 million (US$81.3 million) in the fourth quarter of 2023, which increased from RMB435.8 million in the fourth quarter of 2022. Income from operations of the Tantan segment was RMB26.8 million (US$3.8 million) in the fourth quarter of 2023, compared to a loss from operations of RMB21.7 million in the fourth quarter of 2022.

Non-GAAP income from operations (note 1) was RMB664.2 million (US$93.6 million) in the fourth quarter of 2023, compared to RMB499.2 million during the same period of 2022. Non-GAAP income from operations of the Momo segment was RMB638.9 million (US$90.0 million) in the fourth quarter of 2023, which increased from RMB519.2 million in the fourth quarter of 2022. Non-GAAP income from operations of the Tantan segment was RMB27.0 million (US$3.8 million) in the fourth quarter of 2023, compared to a non-GAAP loss from operations of RMB15.2 million in the fourth quarter of 2022.  

Income tax expenses

Income tax expenses were RMB183.4 million (US$25.8 million) in the fourth quarter of 2023, compared to RMB109.4 million in the fourth quarter of 2022. The increase in income tax expenses was primarily due to the higher profit in the fourth quarter of 2023.

Net income

Net income was RMB452.5 million (US$63.7 million) in the fourth quarter of 2023, compared to RMB397.0 million during the same period of 2022. Net income from the Momo segment was RMB430.0 million (US$60.6 million) in the fourth quarter of 2023, compared to RMB397.1 million in the same period of 2022. Net income from the Tantan segment was RMB24.2 million (US$3.4 million) in the fourth quarter of 2023, compared to RMB4.7 million in the fourth quarter of 2022.

Non-GAAP net income (note 1) was RMB514.7 million (US$72.5 million) in the fourth quarter of 2023, compared to RMB487.0 million during the same period of 2022. Non-GAAP net income from the Momo segment was RMB492.1 million (US$69.3 million) in the fourth quarter of 2023, which increased from RMB480.5 million in the fourth quarter of 2022. Non-GAAP net income of the Tantan segment was RMB24.4 million (US$3.4 million) in the fourth quarter of 2023, compared to RMB11.3 million in the fourth quarter of 2022.

Net income attributable to Hello Group Inc.

Net income attributable to Hello Group Inc. was RMB452.5 million (US$63.7 million) in the fourth quarter of 2023, compared to RMB398.0 million during the same period of 2022.

Non-GAAP net income (note 1) attributable to Hello Group Inc. was RMB514.7 million (US$72.5 million) in the fourth quarter of 2023, compared to RMB487.9 million during the same period of 2022.

Net income per ADS

Diluted net income per ADS was RMB2.32 (US$0.33) in the fourth quarter of 2023, compared to RMB2.01 in the fourth quarter of 2022.

Non-GAAP diluted net income per ADS (note 1) was RMB2.63 (US$0.37) in the fourth quarter of 2023, compared to RMB2.46 in the fourth quarter of 2022.

Cash and cash flow

As of December 31, 2023, the Company’s cash, cash equivalents, short-term deposits, long-term deposits, short-term investments, short-term restricted cash and long-term restricted cash totaled RMB13,478.5 million (US$1,898.4 million), compared to RMB13,398.8 million as of December 31, 2022.

Net cash provided by operating activities in the fourth quarter of 2023 was RMB415.9 million (US$58.6 million), compared to RMB538.7 million in the fourth quarter of 2022.

Full Year 2023 Financial Results

Net revenues for the full year of 2023 were RMB12,002.3 million (US$1,690.5 million), a decrease of 5.5% from RMB12,704.2 million in the same period of 2022.

Net income attributable to Hello Group Inc. was RMB1,957.6 million (US$275.7 million) for the full year of 2023, compared to RMB1,484.3 million during the same period of 2022.

Non-GAAP net income attributable to Hello Group Inc. (note 1) was RMB2,224.7 million (US$313.3 million) for the full year of 2023, compared to RMB1,885.8 million during the same period of 2022.

Diluted net income per ADS was RMB9.84 (US$1.39) during the full year of 2023, compared to RMB7.31 in the same period of 2022.

Non-GAAP diluted net income per ADS (note 1) was RMB11.17 (US$1.57) during the full year of 2023, compared to RMB9.20 in the same period of 2022.

Net cash provided by operating activities was RMB2,277.2 million (US$320.7 million) during the full year of 2023, compared to RMB1,226.9 million in the same period of 2022.

Recent Development

Declaration of a special cash dividend

Hello Group’s board of directors has declared a special cash dividend in the amount of US$0.54 per ADS, or US$0.27 per ordinary share. The cash dividend will be paid on April 30, 2024 to shareholders of record at the close of business on April 12, 2024. The ex-dividend date will be April 11, 2024. The aggregate amount of cash dividends to be paid is approximately US$103 million, which will be funded by available cash on the Company’s balance sheet.

Share repurchase program

On June 7, 2022, Hello Group’s board of directors authorized a share repurchase program under which the Company may repurchase up to US$200 million of its shares up to June 6, 2024 (the “Share Repurchase Program”). As of March 14, 2024, the Company has repurchased 16.2 million ADSs for US$86.1 million on the open market under this program, at an average purchase price of US$5.31 per ADS.

On March 14, 2024, Hello Group’s board of directors approved to amend the Share Repurchase Program to (i) extend the term of the Share Repurchase Program up to June 30, 2026, and (ii) upsize the Share Repurchase Program so that the Company is authorized to, from time to time, acquire up to an aggregate of US$286.1 million worth of its shares in the form of ADSs and/or the ordinary shares of the Company in the open market and through privately negotiated transactions, in block trades and/or through other legally permissible means, depending on market conditions and in accordance with applicable rules and regulations.

Business Outlook

For the first quarter of 2024, the Company expects total net revenues to be between RMB2.45 billion to RMB2.55 billion, representing a decrease of 13.1% to 9.5% year over year. This forecast reflects the Company’s current and preliminary views on the market and operational conditions, which are subject to change.

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.

Reconciliations of our non-GAAP financial measures to our U.S. GAAP financial measures are shown in tables at the end of this earnings release, which provide more details about the non-GAAP financial measures.

Our non-GAAP financial information is provided as additional information to help investors compare business trends among different reporting periods on a consistent basis and to enhance investors’ overall understanding of the historical and current financial performance of our continuing operations and our prospects for the future. Our non-GAAP financial information should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to the GAAP results. In addition, our calculation of the non-GAAP financial measures may be different from the calculation used by other companies, and therefore comparability may be limited.

Our non-GAAP information (including non-GAAP cost and operating expenses, income (loss) from operations, net income (loss), net income attributable to Hello Group Inc., and diluted net income per ADS) is adjusted from the most comparable GAAP results to exclude share-based compensation. A limitation of using these non-GAAP financial measures is that share-based compensation has 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, March 14, 2024, at 8:00 a.m. U.S. Eastern Time (8:00 p.m. Beijing / Hong Kong Time on March 14, 2024).

Participants can register for the conference call by navigating to:

https://s1.c-conf.com/diamondpass/10037219-7ww6gf.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 March 21, 2024. The dial-in details for the replay are as follows:

U.S. / Canada: 1-855-883-1031

Hong Kong: 800-930-639

Passcode: 10037219

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

About Hello Group Inc.

We are a leading player in China’s online social and entertainment space. Through Momo, Tantan and other properties within our product portfolio, we enable users to discover new relationships, expand their social connections and build meaningful interactions. Momo is a mobile application that connects people and facilitates social interactions based on location, interests and a variety of online recreational activities. Tantan, which was added into our family of applications through acquisition in May 2018, is a leading social and dating application. Tantan is designed to help its users find and establish romantic connections as well as meet interesting people. We also operate a number of other applications to serve different social and entertainment demands from our users.

For investor and media inquiries, please contact:

Hello Group Inc.

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

Christensen

In China

Ms. Xiaoyan Su
Phone: +86-10-5900-1548
E-mail: Xiaoyan.Su@christensencomms.com 

In U.S.

Ms. Linda Bergkamp
Phone: +1-480-614-3004
Email: linda.bergkamp@christensencomms.com 

Safe Harbor Statement

This news release contains “forward-looking” statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements include but are not limited to our management quotes, our financial outlook for the first quarter of 2024, 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 fourth quarter of 2023 are preliminary, unaudited and subject to audit adjustment. In addition, we may not meet our financial outlook for the first quarter of 2024 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.          

Hello Group Inc.

Unaudited Condensed Consolidated Statement of Operations

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

Three months

Year

Ended December 31

Ended December 31

2022

2023

2023

2022

2023

2023

RMB

RMB

US$

RMB

RMB

US$

Net revenues:

Live video service

1,724,228

1,523,885

214,635

6,510,460

6,072,871

855,346

Value-added service

1,449,537

1,424,893

200,692

6,007,018

5,752,571

810,233

Mobile marketing

32,927

44,915

6,326

124,956

133,677

18,828

Mobile games

5,316

5,441

766

55,732

19,610

2,762

Other services

650

3,798

535

6,006

23,594

3,323

Total net revenues

3,212,658

3,002,932

422,954

12,704,172

12,002,323

1,690,492

Cost and expenses:

Cost of revenues

(1,916,050)

(1,770,117)

(249,316)

(7,421,419)

(7,025,394)

(989,506)

Research and development

(272,657)

(231,445)

(32,598)

(1,006,219)

(884,590)

(124,592)

Sales and marketing

(407,075)

(304,696)

(42,916)

(2,073,617)

(1,414,949)

(199,291)

General and administrative

(142,492)

(125,498)

(17,676)

(596,006)

(502,479)

(70,773)

Total cost and expenses

(2,738,274)

(2,431,756)

(342,506)

(11,097,261)

(9,827,412)

(1,384,162)

Other operating (loss) income, net

(65,158)

30,821

4,341

20,632

130,105

18,325

Income from operations

409,226

601,997

84,789

1,627,543

2,305,016

324,655

Interest income

88,118

124,354

17,515

368,879

436,253

61,445

Interest expense

(10,955)

(20,552)

(2,895)

(83,530)

(62,223)

(8,764)

Other gain or loss, net

(31,250)

(4,401)

118,325

(26,685)

(3,759)

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

486,389

674,549

95,008

2,031,217

2,652,361

373,577

Income tax expenses

(109,421)

(183,377)

(25,828)

(562,281)

(630,023)

(88,737)

Income before share of income on equity method investments

376,968

491,172

69,180

1,468,936

2,022,338

284,840

Share of income (loss) on equity method investments

20,040

(38,703)

(5,451)

11,073

(70,643)

(9,950)

Net income 

397,008

452,469

63,729

1,480,009

1,951,695

274,890

Less: net loss attributable to non-controlling interest

(986)

(4,274)

(5,886)

(829)

Net income attributable to the shareholders of Hello Group Inc.

397,994

452,469

63,729

1,484,283

1,957,581

275,719

Net income per share attributable to ordinary shareholders

Basic

1.05

1.2

0.17

3.8

5.18

0.73

Diluted

1.01

1.16

0.16

3.65

4.92

0.69

Weighted average shares used in calculating net income per ordinary share

Basic

377,841,986

376,317,036

376,317,036

390,176,367

377,639,399

377,639,399

Diluted

406,152,757

390,956,175

390,956,175

423,810,279

401,833,328

401,833,328

Hello Group Inc.

Unaudited Condensed Consolidated Statement of Comprehensive Income

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

Three months

Year

Ended December 31

Ended December 31

2022

2023

2023

2022

2023

2023

RMB

RMB

US$

RMB

RMB

US$

Net income 

397,008

452,469

63,729

1,480,009

1,951,695

274,890

Other comprehensive income (loss), net of tax:

Foreign currency translation adjustment

54,041

(95,774)

(13,489)

(274,791)

20,414

2,875

Comprehensive income 

451,049

356,695

50,240

1,205,218

1,972,109

277,765

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

(7,154)

(5,020)

(707)

10,556

357

50

Comprehensive income attributable to Hello Group Inc.

458,203

361,715

50,947

1,194,662

1,971,752

277,715

Hello Group Inc.

Unaudited Condensed Consolidated Balance Sheets

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

December 31

December 31

December 31

2022

2023

2023

RMB

RMB

US$

Assets

Current assets

Cash and cash equivalents

5,018,129

5,620,466

791,626

Short-term deposits

5,300,000

1,270,626

178,964

Restricted cash

97,706

10,147

1,429

Short-term investments

300,240

Accounts receivable, net of allowance for doubtful accounts of
RMB5,870 and RMB12,780 as of December 31, 2022 and 2023,
respectively

188,711

201,517

28,383

Amounts due from related parties

55

7,258

1,022

Prepaid expenses and other current assets

819,706

723,364

101,884

Total current assets

11,724,547

7,833,378

1,103,308

Long-term deposits

2,600,000

3,924,975

552,821

Long-term restricted cash

82,766

2,652,299

373,569

Right-of-use assets, net

115,520

109,572

15,433

Property and equipment, net

172,984

659,033

92,823

Intangible assets, net

22,203

17,086

2,407

Rental deposits

20,737

12,962

1,826

Long-term investments

893,988

786,911

110,834

Amounts due from RPT-non current

20,000

2,817

Other non-current assets

162,499

180,052

25,360

Deferred tax assets

34,343

31,741

4,471

Total assets

15,829,587

16,228,009

2,285,669

Liabilities and equity

Current liabilities

Accounts payable

617,022

616,681

86,857

Deferred revenue

484,775

442,805

62,368

Accrued expenses and other current liabilities

797,504

630,617

88,821

Amounts due to related parties

9,178

4,314

608

Lease liabilities due within one year

88,352

60,008

8,452

Income tax payable

68,765

94,719

13,341

Deferred consideration in connection with business acquisitions

26,483

27,261

3,840

Long-term borrowings, current portion

215,615

30,369

Convertible senior notes-current

2,646,168

Total current liabilities

4,738,247

2,092,020

294,656

Deferred tax liabilities

22,011

24,987

3,519

Convertible Senior Notes

19,571

2,757

Long-term borrowings

1,938,385

273,016

Lease liabilities

33,281

52,171

7,348

Other non-current liabilities

105,410

114,085

16,069

Total liabilities

4,898,949

4,241,219

597,365

Shareholder’s equity (i)

10,930,638

11,986,790

1,688,304

Total liabilities and shareholder’s equity

15,829,587

16,228,009

2,285,669

(i): As of December 31, 2023, the number of ordinary shares outstanding was 375,085,192.

Hello Group Inc.

Unaudited Condensed Consolidated Statement of Cash Flows

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

Three months

Year

Ended December 31

Ended December 31

2022

2023

2023

2022

2023

2023

RMB

RMB

US$

RMB

RMB

US$

Cash flows from operating activities:

Net income 

397,008

452,469

63,729

1,480,009

1,951,695

274,890

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

Depreciation of property and equipment

23,908

15,394

2,168

107,015

74,492

10,492

Amortization of intangible assets

1,279

1,279

180

5,116

5,116

721

Share-based compensation

89,944

62,224

8,765

401,484

267,101

37,620

Share of (income) loss on equity method investments

(20,040)

38,703

5,451

(11,073)

70,643

9,950

Gain on repurchase of convertible senior notes

(129,575)

(4,565)

(643)

Loss on long-term investments

31,250

4,401

11,250

31,250

4,401

Cash received on distributions from equity method investments

1,708

2,067

291

Gain or loss on disposal of property and equipment

4

2

(779)

(518)

(73)

Provision of (income) loss on receivable and other assets

(75)

1,553

219

(528)

11,624

1,637

Changes in operating assets and liabilities:

Accounts receivable

4,643

(11,392)

(1,605)

20,338

(21,308)

(3,001)

Prepaid expenses and other current assets

(36,784)

(13,492)

(1,900)

(52,928)

84,802

11,944

Amounts due from related parties

(55)

(144)

(20)

(55)

(27,203)

(3,831)

Rental deposits

5,524

778

1,399

7,776

1,095

Deferred tax assets

1,493

1,728

243

507

2,600

366

Other non-current assets

(15,907)

16,033

2,258

60,913

(11,606)

(1,635)

Accounts payable

(8,992)

(25,118)

(3,538)

(115,384)

13,707

1,931

Income tax payable

(6,081)

5,456

768

(57,004)

25,952

3,655

Deferred revenue

17,504

(31,253)

(4,402)

(56,387)

(42,390)

(5,971)

Accrued expenses and other current liabilities

121,638

(11,586)

(1,632)

(182,708)

(183,772)

(25,884)

Amount due to related parties

(265)

639

90

4,162

(4,865)

(685)

Deferred tax liabilities

(15,367)

(130,345)

(18,359)

(187,119)

(147)

(21)

Other non-current liabilities

(15,159)

6,953

979

(73,470)

24,710

3,480

Net cash provided by operating activities

538,696

415,877

58,573

1,226,891

2,277,161

320,729

Cash flows from investing activities:

Purchase of property and equipment

(10,053)

(316,847)

(44,627)

(80,445)

(576,310)

(81,172)

Payment for long-term investments

(15,000)

(9,750)

(1,373)

(70,343)

(18,750)

(2,641)

Purchase of short-term deposits

(1,700,000)

(1,028,556)

(144,869)

Cash received on maturity of short-term deposits

1,700,000

800,000

112,678

5,410,000

6,209,820

874,635

Payment for short term investments

(300,000)

(300,000)

Cash received from sales of short-term investment

308,550

43,458

308,550

43,458

Cash received on investment income distribution

3,523

1,517

214

Purchase of long-term deposits

(200,000)

(361,165)

(50,869)

(2,750,000)

(4,210,025)

(592,970)

Cash received on maturity of long-term deposits

1,200,000

1,700,000

239,440

Cash received from sales of long-term investment

10,000

1,408

25,000

3,521

Other investing activities

7

1

3,110

1,823

257

Net cash provided by investing activities

1,174,954

430,789

60,675

1,715,845

2,413,069

339,873

Cash flows from financing activities:

Deferred payment for business acquisition

(21,421)

Proceeds from exercise of share options

112

31

4

163

601

85

Repurchase of ordinary shares

(104,684)

(150,191)

(21,154)

(392,374)

(212,195)

(29,887)

Repurchase of subsidiary’s share options

(1,076)

(40,943)

(4,319)

(608)

Dividends payment

(20,803)

(2,930)

(840,997)

(958,052)

(134,939)

Proceeds from long-term borrowings

2,154,000

303,385

Payment for redemption of convertible bonds

(2,136,987)

(2,679,942)

(377,462)

Net cash used in financing activities

(105,648)

(170,963)

(24,080)

(3,432,559)

(1,699,907)

(239,426)

Effect of exchange rate changes

(30,706)

(34,609)

(4,872)

41,390

93,988

13,240

Net increase (decrease) in cash and cash equivalents 

1,577,296

641,094

90,296

(448,433)

3,084,311

434,416

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

3,621,305

7,641,818

1,076,328

5,647,034

5,198,601

732,208

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

5,198,601

8,282,912

1,166,624

5,198,601

8,282,912

1,166,624

 Hello Group Inc.

Reconciliation of Non-GAAP financial measures to comparable GAAP measures

(All amounts in thousands, except per share data)

1.

Reconciliation of Non-GAAP cost and operating expenses, income from operations, and net income to comparable GAAP measures.

Three months

Three months

Three months

Ended December 31, 2022

Ended December 31, 2023

Ended December 31, 2023

GAAP

Share-based
compensation

Non-GAAP

GAAP

Share-based
compensation

Non-GAAP

GAAP

Share-based
compensation

Non-GAAP

RMB

RMB

RMB

RMB

RMB 

RMB

US$

US$

US$

Cost of revenues

(1,916,050)

1,707

(1,914,343)

(1,770,117)

1,909

(1,768,208)

(249,316)

269

(249,047)

Research and development

(272,657)

22,145

(250,512)

(231,445)

13,375

(218,070)

(32,598)

1,884

(30,714)

Sales and marketing

(407,075)

8,480

(398,595)

(304,696)

8,653

(296,043)

(42,916)

1,219

(41,697)

General and administrative

(142,492)

57,612

(84,880)

(125,498)

38,287

(87,211)

(17,676)

5,393

(12,283)

Cost and operating expenses

(2,738,274)

89,944

(2,648,330)

(2,431,756)

62,224

(2,369,532)

(342,506)

8,765

(333,741)

Income from operations

409,226

89,944

499,170

601,997

62,224

664,221

84,789

8,765

93,554

Net income attributable to Hello Group Inc.

397,994

89,944

487,938

452,469

62,224

514,693

63,729

8,765

72,494

Reconciliation of Non-GAAP financial measures to comparable GAAP measures

(All amounts in thousands, except per share data)

1.

Reconciliation of Non-GAAP cost and operating expenses, income from operations, and net income to comparable GAAP measures-continued.

Year

Year

Year

Ended December 31, 2022

Ended December 31, 2023

Ended December 31, 2023

GAAP

Share-based
compensation

Non-GAAP

GAAP

Share-based
compensation

Non-GAAP

GAAP

Share-based
compensation

Non-GAAP

RMB

RMB

RMB

RMB

RMB 

RMB

US$

US$

US$

Cost of revenues

(7,421,419)

14,195

(7,407,224)

(7,025,394)

6,307

(7,019,087)

(989,506)

888

(988,618)

Research and development

(1,006,219)

88,797

(917,422)

(884,590)

64,561

(820,029)

(124,592)

9,093

(115,499)

Sales and marketing

(2,073,617)

38,432

(2,035,185)

(1,414,949)

29,066

(1,385,883)

(199,291)

4,094

(195,197)

General and administrative

(596,006)

260,060

(335,946)

(502,479)

167,167

(335,312)

(70,773)

23,545

(47,228)

Cost and operating expenses

(11,097,261)

401,484

(10,695,777)

(9,827,412)

267,101

(9,560,311)

(1,384,162)

37,620

(1,346,542)

Income from operations

1,627,543

401,484

2,029,027

2,305,016

267,101

2,572,117

324,655

37,620

362,275

Net income attributable to Hello Group Inc.

1,484,283

401,484

1,885,767

1,957,581

267,101

2,224,682

275,719

37,620

313,339

Hello Group Inc.

Unaudited Condensed Segment Report

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

Three months

  Ended December 31, 2023

Momo

Tantan

QOOL

Total

Total

RMB

RMB

RMB

RMB

US$

Net revenues:

Live video service

1,423,730

100,155

1,523,885

214,635

Value-added service

1,264,358

160,535

1,424,893

200,692

Mobile marketing

33,395

11,520

44,915

6,326

Mobile games

5,441

5,441

766

Other services

1,760

2,038

3,798

535

Total net revenues

2,728,684

272,210

2,038

3,002,932

422,954

Cost and expenses (ii):

Cost of revenues

(1,638,915)

(130,237)

(965)

(1,770,117)

(249,316)

Research and development

(180,343)

(51,102)

(231,445)

(32,598)

Sales and marketing

(244,043)

(58,444)

(2,209)

(304,696)

(42,916)

General and administrative

(117,923)

(6,882)

(693)

(125,498)

(17,676)

Total cost and expenses

(2,181,224)

(246,665)

(3,867)

(2,431,756)

(342,506)

Other operating income

29,442

1,301

78

30,821

4,341

Income (loss) from operations

576,902

26,846

(1,751)

601,997

84,789

Interest income

124,294

57

3

124,354

17,515

Interest expense

(20,552)

(20,552)

(2,895)

Other gain or loss, net

(31,250)

(31,250)

(4,401)

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

649,394

26,903

(1,748)

674,549

95,008

Income tax expenses

(180,669)

(2,708)

(183,377)

(25,828)

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

468,725

24,195

(1,748)

491,172

69,180

Share of loss on equity method investments

(38,703)

(38,703)

(5,451)

Net income (loss)

430,022

24,195

(1,748)

452,469

63,729

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

Three months

Ended December 31, 2023

Momo

Tantan

QOOL

Total

Total

RMB

RMB

RMB

RMB

US$

Cost of revenues

1,905

4

1,909

269

Research and development

13,194

181

13,375

1,884

Sales and marketing

8,653

8,653

1,219

General and administrative

38,279

8

38,287

5,393

Total cost and expenses

62,031

193

62,224

8,765

Hello Group Inc.

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

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

Three months

Ended December 31, 2023

Momo

Tantan

QOOL

Total

Total

RMB

RMB

RMB

RMB

US$

Income (loss) from operations

576,902

26,846

(1,751)

601,997

84,789

Share-based compensation

62,031

193

62,224

8,765

Non-GAAP income (loss) from operations

638,933

27,039

(1,751)

664,221

93,554

Net income (loss)

430,022

24,195

(1,748)

452,469

63,729

Share-based compensation

62,031

193

62,224

8,765

Non-GAAP net income (loss)

492,053

24,388

(1,748)

514,693

72,494

Hello Group Inc.

Unaudited Condensed Segment Report

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

Three months

  Ended December 31, 2022

Momo

Tantan

QOOL

Total

Total

RMB

RMB

RMB

RMB

US$[1]

Net revenues:

Live video service

1,561,332

162,896

1,724,228

249,990

Value-added service

1,265,693

183,844

1,449,537

210,164

Mobile marketing

32,927

32,927

4,774

Mobile games

5,316

5,316

771

Other services

483

167

650

93

Total net revenues

2,865,751

346,740

167

3,212,658

465,792

Cost and expenses (iii):

Cost of revenues

(1,722,675)

(192,748)

(627)

(1,916,050)

(277,801)

Research and development

(200,740)

(71,917)

(272,657)

(39,532)

Sales and marketing

(307,166)

(98,209)

(1,700)

(407,075)

(59,020)

General and administrative

(131,844)

(7,899)

(2,749)

(142,492)

(20,659)

Total cost and expenses

(2,362,425)

(370,773)

(5,076)

(2,738,274)

(397,012)

Other operating (loss) income, net

(67,499)

2,339

2

(65,158)

(9,447)

Income (loss) from operations

435,827

(21,694)

(4,907)

409,226

59,333

Interest income

87,799

253

66

88,118

12,776

Interest expense

(10,955)

(10,955)

(1,588)

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

512,671

(21,441)

(4,841)

486,389

70,521

Income tax (expenses) benefits

(135,602)

26,181

(109,421)

(15,865)

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

377,069

4,740

(4,841)

376,968

54,656

Share of income on equity method investments

20,040

20,040

2,906

Net income (loss)

397,109

4,740

(4,841)

397,008

57,562

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

Three months

Ended December 31, 2022

Momo

Tantan

QOOL

Total

Total

RMB

RMB

RMB

RMB

US$

Cost of revenues

1,689

18

1,707

247

Research and development

15,907

6,238

22,145

3,211

Sales and marketing

8,473

7

8,480

1,229

General and administrative

57,350

262

57,612

8,353

Total cost and expenses

83,419

6,525

89,944

13,040

[1] All translations from RMB to U.S. dollars are made at a rate of RMB6.8972 to US$1.00, the effective noon buying rate for December 30, 2022 as set forth in the H.10 statistical release of the Federal Reserve Board.

Hello Group Inc.

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

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

Three months

Ended December 31, 2022

Momo

Tantan

QOOL

Total

Total

RMB

RMB

RMB

RMB

US$

Income (loss) from operations

435,827

(21,694)

(4,907)

409,226

59,333

Share-based compensation

83,419

6,525

89,944

13,040

Non-GAAP income (loss) from
operations

519,246

(15,169)

(4,907)

499,170

72,373

Net income (loss)

397,109

4,740

(4,841)

397,008

57,562

Share-based compensation

83,419

6,525

89,944

13,040

Non-GAAP net income (loss)

480,528

11,265

(4,841)

486,952

70,602

Hello Group Inc.

Unaudited Condensed Segment Report

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

Year

Ended December 31, 2023

Momo

Tantan

QOOL

Total

Total

RMB

RMB

RMB

RMB

US$

Net revenues:

Live video service

5,567,894

504,977

6,072,871

855,346

Value-added service

5,085,541

667,030

5,752,571

810,233

Mobile marketing

109,125

24,552

133,677

18,828

Mobile games

19,610

19,610

2,762

Other services

16,337

7,257

23,594

3,323

Total net revenues

10,798,507

1,196,559

7,257

12,002,323

1,690,492

Cost and expenses (iv):

Cost of revenues

(6,404,042)

(599,348)

(22,004)

(7,025,394)

(989,506)

Research and development

(664,340)

(220,250)

(884,590)

(124,592)

Sales and marketing

(1,138,505)

(268,652)

(7,792)

(1,414,949)

(199,291)

General and administrative

(467,537)

(26,482)

(8,460)

(502,479)

(70,773)

Total cost and expenses

(8,674,424)

(1,114,732)

(38,256)

(9,827,412)

(1,384,162)

Other operating income

125,318

4,411

376

130,105

18,325

Income (loss) from operations

2,249,401

86,238

(30,623)

2,305,016

324,655

Interest income

435,451

713

89

436,253

61,445

Interest expense

(62,223)

(62,223)

(8,764)

Other gain or loss, net

(26,685)

(26,685)

(3,759)

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

2,595,944

86,951

(30,534)

2,652,361

373,577

Income tax expenses

(623,844)

(6,179)

(630,023)

(88,737)

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

1,972,100

80,772

(30,534)

2,022,338

284,840

Share of loss on equity method investments

(70,643)

(70,643)

(9,950)

Net income (loss)

1,901,457

80,772

(30,534)

1,951,695

274,890

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

Year

Ended December 31, 2023

Momo

Tantan

QOOL

Total

Total

RMB

RMB

RMB

RMB

US$

Cost of revenues

6,167

140

6,307

888

Research and development

49,987

14,574

64,561

9,093

Sales and marketing

29,061

5

29,066

4,094

General and administrative

167,135

32

167,167

23,545

Total cost and expenses

252,350

14,751

267,101

37,620

Hello Group Inc.

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

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

Year

Ended December 31, 2023

Momo

Tantan

QOOL

Total

Total

RMB

RMB

RMB

RMB

US$

Income (loss) from operations

2,249,401

86,238

(30,623)

2,305,016

324,655

Share-based compensation

252,350

14,751

267,101

37,620

Non-GAAP income (loss) from operations

2,501,751

100,989

(30,623)

2,572,117

362,275

Net income (loss)

1,901,457

80,772

(30,534)

1,951,695

274,890

Share-based compensation

252,350

14,751

267,101

37,620

Non-GAAP net income (loss)

2,153,807

95,523

(30,534)

2,218,796

312,510

Hello Group Inc.

Unaudited Condensed Segment Report

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

Year

Ended December 31, 2022

Momo

Tantan

QOOL

Total

Total

RMB

RMB

RMB

RMB

US$

Net revenues:

Live video service

5,966,323

544,137

6,510,460

943,928

Value-added service

5,183,302

823,716

6,007,018

870,936

Mobile marketing

124,956

124,956

18,117

Mobile games

55,732

55,732

8,080

Other services

4,781

1,225

6,006

871

Total net revenues

11,335,094

1,367,853

1,225

12,704,172

1,841,932

Cost and expenses (v):

Cost of revenues

(6,704,020)

(714,936)

(2,463)

(7,421,419)

(1,076,005)

Research and development

(737,380)

(268,839)

(1,006,219)

(145,888)

Sales and marketing

(1,346,692)

(721,889)

(5,036)

(2,073,617)

(300,646)

General and administrative

(547,798)

(33,234)

(14,974)

(596,006)

(86,413)

Total cost and expenses

(9,335,890)

(1,738,898)

(22,473)

(11,097,261)

(1,608,952)

Other operating income

8,753

11,830

49

20,632

2,991

Income (loss) from operations

2,007,957

(359,215)

(21,199)

1,627,543

235,971

Interest income

368,051

544

284

368,879

53,482

Interest expense

(83,530)

(83,530)

(12,111)

Other gain or loss, net

118,325

118,325

17,156

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

2,410,803

(358,671)

(20,915)

2,031,217

294,498

Income tax (expenses) benefits

(586,663)

24,382

(562,281)

(81,523)

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

1,824,140

(334,289)

(20,915)

1,468,936

212,975

Share of income on equity method investments

11,073

11,073

1,605

Net income (loss)

1,835,213

(334,289)

(20,915)

1,480,009

214,580

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

Year

Ended December 31, 2022

Momo

Tantan

QOOL

Total

Total

RMB

RMB

RMB

RMB

US$

Cost of revenues

7,166

7,029

14,195

2,058

Research and development

67,659

21,138

88,797

12,874

Sales and marketing

38,202

230

38,432

5,572

General and administrative

259,669

391

260,060

37,705

Total cost and expenses

372,696

28,788

401,484

58,209

Hello Group Inc.

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

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

Year

Ended December 31, 2022

Momo

Tantan

QOOL

Total

Total

RMB

RMB

RMB

RMB

US$

Income (loss) from operations

2,007,957

(359,215)

(21,199)

1,627,543

235,971

Share-based compensation

372,696

28,788

401,484

58,209

Non-GAAP income (loss) from
operations

2,380,653

(330,427)

(21,199)

2,029,027

294,180

Net income (loss)

1,835,213

(334,289)

(20,915)

1,480,009

214,580

Share-based compensation

372,696

28,788

401,484

58,209

Non-GAAP net income (loss)

2,207,909

(305,501)

(20,915)

1,881,493

272,789

Source: Hello Group Inc.