MOMO Q2 2026 Earnings Call Summary

1Key Financial Results and Metrics

Total Revenue: RMB 2.49 billion, down 5% year-over-year but up 4% quarter-over-quarter.

Domestic Revenue: RMB 1.81 billion, down 17% year-over-year, up 1% quarter-over-quarter.

Overseas Revenue: RMB 673 million, up 52% year-over-year and 13% quarter-over-quarter, now accounting for 27% of total revenue.

Adjusted Operating Income: RMB 276 million, with an operating margin of 11%.

Non-GAAP Net Income: RMB 249 million, compared to a net loss of RMB 96 million in Q2 2025.

Value-Added Services (VAS) Revenue: RMB 2.44 billion, down 5% year-over-year but up 4% quarter-over-quarter.

2Strategic Updates and Business Highlights

Momo: Focused on product innovation and refined operations, leading to a modest increase in user engagement and a rise in paying users to 3.9 million.

Tantan: Emphasized AI-driven improvements to enhance user experience, with a slight decrease in paying users to 0.5 million due to external factors affecting payment renewals.

Overseas Expansion: Strong growth in MENA products, with Yahalan achieving breakeven and Ammar showing rapid revenue growth. The diversification of the product portfolio is expected to enhance resilience against external risks.

3Forward Guidance and Outlook

Q3 Revenue Guidance: Expected to be between RMB 2.4 billion and RMB 2.5 billion, representing a year-over-year decline of 5.7% to 9.4%.

Domestic Revenue Outlook: Anticipated to decline by high-teens percentage-wise, while overseas revenue is expected to grow by high-thirties percentage-wise.

Full-Year Revenue Outlook: Group revenue decline is now expected to be in the mid-single-digit range, reflecting a more challenging environment than previously anticipated.

4Bad News, Challenges, or Points of Concern

Domestic Revenue Pressure: Significant decline in spending from high net worth users due to macroeconomic volatility, impacting overall revenue.

Regulatory Environment: Although currently stable, any future changes could pose risks.

Profitability Challenges: Additional pressure from investments in film production and the need for cost management to maintain margins.

User Acquisition Costs: Rising costs and changes in payment policies have affected user acquisition and retention strategies.

5Notable Q&A Insights

Domestic Revenue Decline: Management acknowledged that the decline in domestic revenue is more pronounced than earlier expected, primarily due to reduced spending among high-value users.

Cost Management Focus: Plans to optimize operating expenses, particularly in personnel and marketing, to mitigate revenue pressures.

Overseas Business Performance: The combined revenue from Yahalan and Ammar is expected to surpass that of SoulChill, indicating strong growth potential in the MENA region despite challenges faced by SoulChill.

Profitability Outlook: While the revenue environment is challenging, management believes that with effective cost control, the original margin targets could still be achievable. This summary encapsulates MOMO's current financial standing, strategic direction, and challenges, providing a clear overview for stakeholders.