EX-99.1

EX-99.1 2 d163119dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

Momo Announces Unaudited Financial Results for the Fourth Quarter and Fiscal Year 2020

BEIJING, CHINA, March 25, 2021 – Momo Inc. (NASDAQ: MOMO) (“Momo” or the “Company”), a leading mobile social networking platform in China, today announced its unaudited financial results for the fourth quarter and the full year ended December 31, 2020.

Fourth Quarter of 2020 Highlights

•

Net revenues decreased by 19.0% year over year to RMB3,795.2 million (US$581.6 million^*) in the fourth quarter of 2020.

•

Net income attributable to Momo Inc. decreased to RMB651.5 million (US$99.8 million) in the fourth quarter of 2020 from RMB1,055.9 million in the same period of 2019.

•

Non-GAAP net income attributable to Momo Inc. (note 1) decreased to RMB836.4 million (US$128.2 million) in the fourth quarter of 2020, from RMB1,252.5 million in the same period of 2019.

•

Diluted net income per American Depositary Share (“ADS”) was RMB2.98 (US$0.46) in the fourth quarter of 2020, compared to RMB4.74 in the same period of 2019.

•

Non-GAAP diluted net income per ADS (note 1) was RMB3.80 (US$0.58) in the fourth quarter of 2020, compared to RMB5.61 in the same period of 2019.

•

Monthly Active Users (“MAU”) on Momo application were 113.8 million in December 2020, compared to 114.5 million in December 2019.

•

Total paying users of our live video service and value-added service, without double counting the overlap and including 3.8 million paying users of Tantan Limited (“Tantan”), were 12.8 million for the fourth quarter of 2020, compared to 13.8 million for the fourth quarter of 2019, which included 4.5 million paying users of Tantan.

Full Year 2020 Highlights

•

Net revenues decreased by 11.7% year over year to RMB15,024.2 million (US$2,302.6 million) for the full year of 2020.

•

Net income attributable to Momo Inc. was RMB2,103.5 million (US$322.4 million) for the full year of 2020, compared with RMB2,970.9 million during the same period of 2019.

•

Non-GAAP net income attributable to Momo Inc. (note 1) was RMB2,896.2 million (US$443.9 million) for the full year of 2020, compared with RMB4,493.3 million during the same period of 2019.

•

Diluted net income per ADS was RMB9.65 (US$1.48) for the full year of 2020, compared with RMB13.52 during the same period of 2019.

•

Non-GAAP diluted net income per ADS (note 1) was RMB13.16 (US$2.02) for the full year of 2020, compared with RMB20.26 during the same period of 2019.

“2020 was a tough year for us. I am proud that my teams were able to navigate through the many challenges with relentless focus on our core mission. Our commitment to the core mission enabled us to make difficult but right decision in the past year for the long term wellbeing of our company and our community.” Commented Li Wang, CEO of Momo. “After several months of hard work, we have started seeing positive trends in the content ecosystem as well as business of the core Momo. Getting through the bumpy journey last year was a valuable growth experience for our team. I am happy to see we have finally come out of the temporary drawbacks, stronger and better poised to seize the growth opportunities ahead of us.”

This press release contains translations of certain Renminbi amounts into U.S. dollars at specified rates solely for the convenience of readers. Unless otherwise noted, all translations from Renminbi to U.S. dollars, in this press release, were made at a rate of RMB6.525 to US$1.00, the effective noon buying rate for December 31, 2020 as set forth in the H.10 statistical release of the Federal Reserve Board.

Fourth Quarter of 2020 Financial Results

Net revenues

Total net revenues were RMB3,795.2 million (US$581.6 million) in the fourth quarter of 2020, a decrease of 19.0% from RMB4,687.9 million in the fourth quarter of 2019.

Live video service revenues were RMB2,327.9 million (US$356.8 million) in the fourth quarter of 2020, a decrease of 31.2% from RMB3,383.5 million during the same period of 2019. The decrease was primarily due to our structural reform on Momo’s core live video business, which was used to revive the long tail content ecosystem and to a lesser extent, the impact of COVID-19 adversely affecting the sentiment of our paying users, especially among the top of the pyramid paying users. The decrease was partially offset by the growth from Tantan’s live video service, and live video service revenues from Tantan were RMB404.3 million (US$62.0 million) in the fourth quarter of 2020.

Value-added service revenues mainly include virtual gift revenues and membership subscription revenues. Total value-added service revenues were RMB1,401.3 million (US$214.8 million) in the fourth quarter of 2020, an increase of 17.8% from RMB1,189.1 million during the same period of 2019. The year-over-year increase was primarily attributable to the continued growth of the virtual gift business on the Momo application driven by more innovative products and operational ideas launched, and more paying scenarios introduced to enhance the social entertainment experience of Momo users.

Mobile marketing revenues were RMB52.7 million (US$8.1 million) in the fourth quarter of 2020, a decrease of 43.4% from RMB93.0 million during the same period of 2019. The decrease in mobile marketing revenues was primarily caused by the decreased demand from our advertising and marketing customers as well as our strategy to underweight the line in terms of resource allocation.

Mobile games revenues were RMB7.3 million (US$1.1 million) in the fourth quarter of 2020, a decrease of 49.1% from RMB14.4 million in the fourth quarter of 2019. The decrease in mobile game revenues was mainly due to the continued decrease in quarterly paying users of mobile games.

Net revenues from the Momo segment decreased from RMB4,317.3 million in the fourth quarter of 2019 to RMB3,051.3 million (US$467.6 million) in the fourth quarter of 2020, primarily due to the decrease in net revenues from live video service, partially offset by the increase in net revenues from value-added service. Net revenues from the Tantan segment increased from RMB369.8 million in the fourth quarter of 2019 to RMB740.5 million (US$113.5 million) in the fourth quarter of 2020, which was mainly due to the increase in net revenues from live video service.

Cost and expenses

Cost and expenses were RMB3,290.0 million (US$504.2 million) in the fourth quarter of 2020, a decrease of 8.1% from RMB3,581.1 million in the fourth quarter of 2019. The decrease was primarily attributable to: (a) a decrease in revenue sharing with broadcasters related to our live video service; (b) a decrease in professional fees related to technological service and bandwidth costs; (c) a decrease in commission fees paid to payment channels. These decreases were partially offset by an increase in revenue sharing with virtual gift recipients for our virtual gift service.

Non-GAAP cost and expenses (note 1) were RMB3,095.9 million (US$474.5 million) in the fourth quarter of 2020, a decrease of 8.3% from RMB3,374.9 million during the same period of 2019.

Other operating income

Other operating income was RMB88.4 million (US$13.5 million) in the fourth quarter of 2020, a decrease from RMB142.6 million during the fourth quarter of 2019. The other operating income mainly consisted of government incentives.

Income from operations

Income from operations was RMB593.6 million (US$91.0 million) in the fourth quarter of 2020, compared to RMB1,249.4 million during the same period of 2019. Income from operations of the Momo segment was RMB650.9 million (US$99.8 million) in the fourth quarter of 2020, which decreased from RMB1,458.5 million in the fourth quarter of 2019. Loss from operations of the Tantan segment was RMB53.1 million (US$8.1 million) in the fourth quarter of 2020, compared to loss from operations of RMB202.7 million in the fourth quarter of 2019.

Non-GAAP income from operations (note 1) was RMB787.7 million (US$120.7 million) in the fourth quarter of 2020, compared to RMB1,455.7 million during the same period of 2019. Non-GAAP income from operations of the Momo segment was RMB791.8 million (US$121.4 million) in the fourth quarter of 2020, which decreased from RMB1,593.9 million in the fourth quarter of 2019. Non-GAAP loss from operations of the Tantan segment was RMB2.3 million (US$0.4 million) in the fourth quarter of 2020, compared to non-GAAP loss from operations of RMB135.0 million in the fourth quarter of 2019.

Income tax expenses

Income tax expenses were RMB5.5 million (US$0.8 million) in the fourth quarter of 2020, decreasing from RMB253.7 million in the fourth quarter of 2019. The decrease in income tax expenses was mainly due to (a) the preferential tax rate adjustment from 12.5% to 10.0% for one of our major profit generating entities, due to the approval in 2020 of the Key Software Enterprise application for the income tax of the fiscal year of 2019; and (b) the lower profit in the fourth quarter of 2020.

Net income

Net income was RMB651.1 million (US$99.8 million) in the fourth quarter of 2020, compared to RMB1,052.3 million during the same period of 2019. Net income from the Momo segment was RMB705.8 million (US$108.2 million) in the fourth quarter of 2020, which decreased from RMB1,246.9 million in the fourth quarter of 2019. Net loss from the Tantan segment was RMB50.5 million (US$7.7 million) in the fourth quarter of 2020, compared to net loss of RMB188.2 million in the fourth quarter of 2019.

Non-GAAP net income (note 1) was RMB836.1 million (US$128.1 million) in the fourth quarter of 2020, compared to RMB1,248.9 million during the same period of 2019. Non-GAAP net income from the Momo segment was RMB846.7 million (US$129.8 million) in the fourth quarter of 2020, which decreased from RMB1,382.3 million in the fourth quarter of 2019. Non-GAAP net loss of the Tantan segment was RMB8.8 million (US$1.4 million) in the fourth quarter of 2020, compared to non-GAAP net loss of RMB130.2 million in the fourth quarter of 2019.

Net income attributable to Momo Inc.

Net income attributable to Momo Inc. was RMB651.5 million (US$99.8 million) in the fourth quarter of 2020, compared to RMB1,055.9 million during the same period of 2019.

Non-GAAP net income (note 1) attributable to Momo Inc. was RMB836.4 million (US$128.2 million) in the fourth quarter of 2020, compared to RMB1,252.5 million during the same period of 2019.

Net income per ADS

Diluted net income per ADS was RMB2.98 (US$0.46) in the fourth quarter of 2020, compared to RMB4.74 in the fourth quarter of 2019.

Non-GAAP diluted net income per ADS (note 1) was RMB3.80 (US$0.58) in the fourth quarter of 2020, compared to RMB5.61 in the fourth quarter of 2019.

Cash and cash flow

As of December 31, 2020, Momo’s cash, cash equivalents, short-term deposits, long-term deposits and restricted cash totaled RMB16,482.3 million (US$2,526.0 million), compared to RMB15,225.3 million as of December 31, 2019. Net cash provided by operating activities in the fourth quarter of 2020 was RMB1,039.1 million (US$159.2 million), compared to RMB1,675.1 million in the fourth quarter of 2019.

Full Year 2020 Financial Results

Net revenues for the full year of 2020 were RMB15,024.2 million (US$2,302.6 million), a decrease of 11.7% from RMB17,015.1 million in the same period of 2019.

Net income attributable to Momo Inc. was RMB2,103.5 million (US$322.4 million) for the full year of 2020, compared to RMB2,970.9 million during the same period of 2019.

Non-GAAP net income attributable to Momo Inc. (note 1) was RMB2,896.2 million (US$443.9 million) for the full year of 2020, compared to RMB4,493.3 million during the same period of 2019.

Diluted net income per ADS was RMB9.65 (US$1.48) during the full year of 2020, compared to RMB13.52 in the same period of 2019.

Non-GAAP diluted net income per ADS (note 1) was RMB13.16 (US$2.02) during the full year of 2020, compared to RMB20.26 in the same period of 2019.

Net cash provided by operating activities was RMB3,080.9 million (US$472.2 million) during the full year of 2020, compared to RMB5,448.9 million in the same period of 2019.

Recent Developments

Declaration of a special cash dividend

Momo’s board of directors has declared a special cash dividend in the amount of US$0.64 per ADS, or US$0.32 per ordinary share. The cash dividend will be paid on April 30, 2021 to shareholders of record at the close of business on April 13, 2021. The ex-dividend date will be April 12, 2021. The aggregate amount of cash dividends to be paid is approximately US$132 million, which will be funded by surplus cash on the Company’s balance sheet.

Execution of share repurchase program

On September 3, 2020, Momo’s board of directors authorized a share repurchase program under which the Company may repurchase up to US$300 million of its shares over the next 12 months. As of March 24, 2021, the Company has repurchased approximately 3.61 million ADSs for approximately US$49.2 million on the open market under this program, at an average purchase price of US$13.63 per ADS.

Resignation of Chief Technology Officer

Mr. Chunlai Wang will resign from the Company’s Chief Technology Officer position for personal reasons, effective April 30, 2021, and he will continue to serve as an advisor to the Company. The Company is grateful to Mr. Chunlai Wang for his valuable contributions over the past nine years.

Business Outlook

For the first quarter of 2021, the Company expects total net revenues to be between RMB3.36 billion to RMB3.46 billion, representing a decrease of 6.5% to 3.7% year-over-year. This forecast considers the potential impact of the COVID-19 pandemic and reflects the Company’s current and preliminary views on the market and operational conditions, which are subject to change, particularly with respect to the potential lasting impact of COVID-19 on the economy in China.

Note 1: Non-GAAP measures

To supplement our consolidated financial statements presented in accordance with U.S. generally accepted accounting principles (“GAAP”), we use various non-GAAP financial measures that are adjusted from the most comparable GAAP results to exclude share-based compensation and amortization of intangible assets from business acquisitions, and tax impacts related to the amortization of intangible assets from business acquisitions.

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

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

Our non-GAAP information (including non-GAAP cost and operating expenses, income (loss) from operations, net income (loss)，net income attributable to Momo 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 a significant recurring expense in our results of operations. We compensate for these limitations 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

Momo’s management will host an earnings conference call on Thursday, March 25, 2021, at 8:00 a.m. U.S. Eastern Time (8:00 p.m. Beijing / Hong Kong Time on March 25, 2021).

All participants must preregister online prior to the call to receive the dial-in details. Once preregistration has been complete, participants will receive dial-in numbers, direct event passcode, and a unique registrant ID.

PRE-REGISTER LINK http://apac.directeventreg.com/registration/event/2751618

To join the conference, simply dial the number in the calendar invite you receive after preregistering, enter the passcode followed by your registrant ID, and you will join the conference instantly.

A telephone replay of the call will be available after the conclusion of the conference call through 8:00 a.m. U.S. Eastern Time, April 1, 2021. The dial-in details for the replay are as follows:

International: +61-2-8199-0299

U.S. Toll Free: +1-855-452-5696

Passcode: 2751618

Additionally, a live and archived webcast of the conference call will be available on the Investor Relations section of Momo’s website at http://ir.immomo.com.

About Momo

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 interactions based on location, interests and a variety of recreational activities including live talent shows, short videos, social games as well as other video- and audio-based interactive experiences, such as live chats and mobile karaoke experience. Tantan, which was added into our family of applications through acquisition in May 2018, is a leading social and dating application for the younger generation. Tantan is designed to help its users find and establish romantic connections as well as meet interesting people.

For investor and media inquiries, please contact:

Momo Inc.

Investor Relations

Phone: +86-10-5731-0538

Email: ir@immomo.com

Christensen

In China

Mr. Eric Yuan

Phone: +86-10-5900-1548

E-mail: Eyuan@christensenir.com

In US

Ms. Linda Bergkamp

Phone: +1-480-614-3004

Email: lbergkamp@christensenir.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 2021, 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 2020 are preliminary, unaudited and subject to audit adjustment. In addition, we may not meet our financial outlook for the first quarter of 2021 and may be unable to grow our business in the manner planned. We may also modify our strategy for growth. Moreover, there are other risks and uncertainties that could cause our actual results to differ from what we currently anticipate, including those relating to our ability to retain and grow our user base, our ability to attract and retain sufficiently trained professionals to support our operations, our ability to anticipate and develop new services and enhance existing services to meet the demand of our users or customers, the impact of the COVID-19 pandemic on Momo’s business operations and the economy in China, the market price of Momo’s stock prevailing from time to time, the nature of other investment opportunities presented to Momo from time to time, Momo’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

Momo 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
	2019			2020			2020			2019			2020			2020
	RMB			RMB			US$			RMB			RMB			US$
Net revenues:
Live video service		3,383,477			2,327,875			356,762			12,448,131			9,637,579			1,477,024
Value-added service		1,189,114			1,401,269			214,754			4,105,963			5,112,182			783,476
Mobile marketing		92,991			52,663			8,071			331,822			198,197			30,375
Mobile games		14,418			7,334			1,124			92,451			39,564			6,063
Other services		7,898			6,060			929			36,722			36,666			5,620

Total net revenues		4,687,898			3,795,201			581,640			17,015,089			15,024,188			2,302,558
Cost and expenses:
Cost of revenues		(2,351,309	)		(2,042,781	)		(313,070	)		(8,492,096	)		(7,976,781	)		(1,222,495	)
Research and development		(292,188	)		(327,295	)		(50,160	)		(1,095,031	)		(1,167,677	)		(178,954	)
Sales and marketing		(725,029	)		(697,722	)		(106,931	)		(2,690,824	)		(2,813,922	)		(431,252	)
General and administrative		(212,603	)		(222,191	)		(34,052	)		(1,527,282	)		(763,150	)		(116,958	)

Total cost and expenses		(3,581,129	)		(3,289,989	)		(504,213	)		(13,805,233	)		(12,721,530	)		(1,949,659	)
Other operating income		142,646			88,385			13,546			344,843			228,777			35,062

Income from operations		1,249,415			593,597			90,973			3,554,699			2,531,435			387,961
Interest income		108,205			100,880			15,461			407,542			444,471			68,118
Interest expense		(20,190	)		(19,047	)		(2,919	)		(78,611	)		(78,872	)		(12,088	)
Other gain or loss, net		—			7,500			1,149			(15,711	)		1,500			230

Income before income tax and share of income on equity method investments		1,337,430			682,930			104,664			3,867,919			2,898,534			444,221
Income tax expenses		(253,704	)		(5,481	)		(840	)		(883,801	)		(755,620	)		(115,804	)

Income before share of income on equity method investments		1,083,726			677,449			103,824			2,984,118			2,142,914			328,417
Share of loss on equity method investments		(31,406	)		(26,319	)		(4,034	)		(23,350	)		(42,522	)		(6,517	)

Net income		1,052,320			651,130			99,790			2,960,768			2,100,392			321,900

Less: net loss attributable to non-controlling interest		(3,579	)		(320	)		(49	)		(10,122	)		(3,092	)		(474	)

Net income attributable to the shareholders of Momo Inc.		1,055,899			651,450			99,839			2,970,890			2,103,484			322,374

Net income per share attributable to ordinary shareholders
Basic		2.53			1.57			0.24			7.15			5.05			0.77
Diluted		2.37			1.49			0.23			6.76			4.83			0.74
Weighted average shares used in calculating net income per ordinary share
Basic		416,878,784			414,839,350			414,839,350			415,316,627			416,914,898			416,914,898
Diluted		453,937,852			449,683,596			449,683,596			451,206,091			452,081,642			452,081,642

Momo 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
	2019			2020			2020			2019			2020			2020
	RMB			RMB			US$			RMB			RMB			US$
Net income		1,052,320			651,130			99,790			2,960,768			2,100,392			321,900
Other comprehensive loss, net of tax
Foreign currency translation adjustment		(39,524	)		(69,010	)		(10,576	)		(8,835	)		(141,677	)		(21,713	)

Comprehensive income		1,012,796			582,120			89,214			2,951,933			1,958,715			300,187
Less: comprehensive loss attributed to the non-controlling interest		(8,637	)		(9,059	)		(1,388	)		(8,081	)		(26,004	)		(3,985	)

Comprehensive income attributable to Momo Inc.		1,021,433			591,179			90,602			2,960,014			1,984,719			304,172


Momo Inc.
Unaudited Condensed Consolidated Balance Sheets
(All amounts in thousands, except share and per share data)
	December 31 2019 RMB		December 31 2020 RMB		December 31 2020 US$
Assets
Current assets
Cash and cash equivalents		2,612,743		3,363,942		515,547
Short-term deposits		12,312,585		7,566,250		1,159,579
Restricted cash		—		2,130		326
Accounts receivable, net of allowance for doubtful accounts of RMB12,209 and RMB15,390 as of December 31, 2019 and 2020, respectively		265,155		200,831		30,779
Amount due from a related party		4,382		—		—
Prepaid expenses and other current assets		599,000		613,696		94,053


Total current assets		15,793,865		11,746,849		1,800,284
Long-term deposits		300,000		5,550,000		850,575
Right-of-use assets, net		190,552		278,175		42,632
Property and equipment, net		346,345		265,765		40,730
Intangible assets		890,303		687,211		105,320
Rental deposits		25,028		21,794		3,340
Long-term investments		495,905		454,996		69,731
Other non-current assets		44,009		94,868		14,539
Deferred tax assets		37,064		32,495		4,980
Goodwill		4,360,610		4,088,403		626,575

Total assets		22,483,681		23,220,556		3,558,706

Liabilities and equity
Current liabilities
Accounts payable		714,323		699,394		107,186
Deferred revenue		503,461		511,617		78,409
Accrued expenses and other current liabilities		985,873		854,835		131,009
Amount due to related parties		29,606		19,462		2,983
Lease liabilities due within one year		135,169		132,793		20,351
Income tax payable		153,976		236,490		36,244
Deferred consideration in connection with business acquisitions		84,346		62,149		9,525

Total current liabilities		2,606,754		2,516,740		385,707
Deferred tax liabilities		222,576		171,803		26,330
Convertible senior notes		4,954,352		4,658,966		714,018
Share-based compensation liability		902,047		875,616		134,194
Lease liabilities		56,498		136,436		20,910
Other non-current liabilities		22,672		25,666		3,933

Total liabilities		8,764,899		8,385,227		1,285,092
Shareholder’s equity (i)		13,718,782		14,835,329		2,273,614

Total liabilities and shareholder’s equity		22,483,681		23,220,556		3,558,706

(i):	As of December 31, 2020, the number of ordinary shares outstanding was 411,981,508.


Momo Inc. Unaudited Condensed Consolidated Statement of Cash Flows (All amounts in thousands, except share and per share data)
	Three months ended December 31									Year ended December 31
	2019 RMB			2020 RMB			2020 US$			2019 RMB			2020 RMB			2020 US$
Cash flows from operating activities:
Net income		1,052,320			651,130			99,790			2,960,768			2,100,392			321,900
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation of property and equipment		51,385			55,375			8,487			198,237			208,990			32,029
Amortization of intangible assets		40,239			37,741			5,784			157,954			157,258			24,101
Share-based compensation		167,458			157,584			24,151			1,408,232			678,686			104,013
Share of loss on equity method investments		31,406			26,319			4,034			23,350			42,522			6,517
Gain or loss on long-term investments		—			(7,500	)		(1,149	)		15,711			(1,500	)		(230	)
Gain on subsidiary deconsolidation		—			—			—			—			(6,676	)		(1,023	)
Loss (gain) on disposal of property and equipment		—			3			—			(398	)		(282	)		(43	)
Provision of losses on receivable and other assets		—			19,663			3,013			12,209			46,075			7,061
Cash received on investment income distribution		—			—			—			—			1,153			177
Changes in operating assets and liabilities:
Accounts receivable		110,340			34,533			5,292			442,176			52,247			8,007
Prepaid expenses and other current assets		49,554			104,636			16,036			26,372			(59,117	)		(9,060	)
Amount due from a related party		(2,776	)		—			—			(4,382	)		4,382			672
Rental deposits		(474	)		(4,372	)		(670	)		(836	)		(4,265	)		(654	)
Deferred tax assets		(2,582	)		1,535			235			20,722			4,569			700
Other non-current assets		(3,411	)		(166,665	)		(25,543	)		(24,022	)		(138,484	)		(21,224	)
Accounts payable		98,021			66,948			10,260			52,246			(11,716	)		(1,796	)
Income tax payable		39,938			(95,341	)		(14,612	)		16,886			82,514			12,646
Deferred revenue		6,852			24,740			3,792			61,641			8,910			1,366
Accrued expenses and other current liabilities		75,791			41,048			6,291			212,349			(120,363	)		(18,446	)
Amount due to related parties		235			(12,406	)		(1,901	)		(53,032	)		(10,144	)		(1,555	)
Deferred tax liability		(10,060	)		(9,435	)		(1,446	)		(45,382	)		(39,315	)		(6,025	)
Other non-current liabilities		(29,153	)		113,553			17,403			(31,915	)		85,053			13,035

Net cash provided by operating activities		1,675,083			1,039,089			159,247			5,448,886			3,080,889			472,168
Cash flows from investing activities:
Purchase of property and equipment		(32,109	)		(16,095	)		(2,467	)		(186,522	)		(124,143	)		(19,026	)
Proceeds from disposal of property and equipment		4			2			—			808			476			73
Payment for long-term investments		(21,500	)		(9,000	)		(1,379	)		(64,500	)		(13,500	)		(2,069	)
Prepayment of long-term investments		—			—			—			(15,000	)		—			—
Cash dividend received		—			—			—			—			233			36
Cash outflow due to subsidiary deconsolidation		—			—			—			—			(1,026	)		(157	)
Purchase of short-term deposits		(7,650,000	)		(3,654,500	)		(560,077	)		(22,151,135	)		(14,949,665	)		(2,291,136	)
Cash received on maturity of short-term deposits		6,036,000			3,954,500			606,054			18,686,430			19,577,159			3,000,331
Payment for short-term investments		(80,000	)		—			—			(360,000	)		(10,000	)		(1,533	)
Cash received from sales of short-term investment		120,000			—			—			360,000			10,000			1,533
Cash received from sales of long term investment		—			12,000			1,839			—			12,000			1,839
Purchase of long-term deposits		(300,000	)		(900,000	)		(137,931	)		(300,000	)		(5,250,000	)		(804,598	)

Net cash used in investing activities		(1,927,605	)		(613,093	)		(93,961	)		(4,029,919	)		(748,466	)		(114,707	)
Cash flows from financing activities:
Deferred payment for business acquisition		—			—			—			(379,507	)		(18,355	)		(2,813	)
Proceeds from exercise of share options		1			171			26			187			226			35
Deferred payment of purchase of property and equipment		(127	)		—			—			(17,114	)		—			—
Repurchase of ordinary shares		—			(197,799	)		(30,314	)		—			(330,206	)		(50,606	)
Repurchase of subsidiary’s share options		—			(932	)		(143	)		—			(25,832	)		(3,959	)
Dividends payment		—			—			—			(877,346	)		(1,123,983	)		(172,258	)

Net cash used in financing activities		(126	)		(198,560	)		(30,431	)		(1,273,780	)		(1,498,150	)		(229,601	)
Effect of exchange rate changes		(5,532	)		(37,770	)		(5,788	)		(478	)		(80,944	)		(12,407	)

Net (decrease) increase in cash and cash equivalents		(258,180	)		189,666			29,067			144,709			753,329			115,453
Cash and cash equivalents at the beginning of period		2,870,923			3,176,406			486,806			2,468,034			2,612,743			400,420

Cash, cash equivalent and restricted cash at the end of period		2,612,743			3,366,072			515,873			2,612,743			3,366,072			515,873

Momo 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 ended December 31, 2019													Three months ended December 31, 2020													Three months ended December 31, 2020
	GAAP RMB			Amortization of intangible assets from business acquisitions RMB		Share- based compen sation RMB		Tax impacts (ii) RMB			Non-GAAP RMB			GAAP RMB			Amortization of intangible assets from business acquisitions RMB		Share- based compensa tion RMB		Tax impacts (ii) RMB			Non-GAAP RMB			GAAP US$			Amortization of intangible assets from business acquisitions US$		Share- based compen sation US$		Tax impacts (ii) US$			Non- GAAP US$
Cost of revenues		(2,351,309	)		18,818		7,601		—			(2,324,890	)		(2,042,781	)		17,694		4,242		—			(2,020,845	)		(313,070	)		2,712		650		—			(309,708	)
Research and development		(292,188	)		2,390		45,455		—			(244,343	)		(327,295	)		2,247		38,515		—			(286,533	)		(50,160	)		344		5,903		—			(43,913	)
Sales and marketing		(725,029	)		17,598		53,466		—			(653,965	)		(697,722	)		16,547		27,122		—			(654,053	)		(106,931	)		2,536		4,157		—			(100,238	)
General and administrative		(212,603	)		—		60,936		—			(151,667	)		(222,191	)		—		87,705		—			(134,486	)		(34,052	)		—		13,441		—			(20,611	)

Cost and operating expenses		(3,581,129	)		38,806		167,458		—			(3,374,865	)		(3,289,989	)		36,488		157,584		—			(3,095,917	)		(504,213	)		5,592		24,151		—			(474,470	)
Income from operations		1,249,415			38,806		167,458		—			1,455,679			593,597			36,488		157,584		—			787,669			90,973			5,592		24,151		—			120,716
Net income attributable to Momo Inc.		1,055,899			38,806		167,458		(9,701	)		1,252,462			651,450			36,488		157,584		(9,122	)		836,400			99,839			5,592		24,151		(1,398	)		128,184

Momo Inc.

Reconciliation of Non-GAAP financial measures to comparable GAAP measures

(All amounts in thousands, except per share data)

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


	Year ended December 31, 2019													Year ended December 31, 2020													Year ended December 31, 2020
	GAAP RMB			Amortization of intangible assets from business acquisitions RMB		Share- based compensation RMB		Tax impacts (ii) RMB			Non- GAAP RMB			GAAP RMB			Amortization of intangible assets from business acquisitions RMB		Share- based compensation RMB		Tax impacts (ii) RMB			Non- GAAP RMB			GAAP US$			Amortization of intangible assets from business acquisitions US$		Share-based compensation US$		Tax impacts (ii) US$			Non- GAAP US$
Cost of revenues		(8,492,096	)		73,817		23,972		—			(8,394,307	)		(7,976,781	)		73,740		18,449		—			(7,884,592	)		(1,222,495	)		11,301		2,827		—			(1,208,367	)
Research and development		(1,095,031	)		9,375		175,053		—			(910,603	)		(1,167,677	)		9,365		175,870		—			(982,442	)		(178,954	)		1,435		26,953		—			(150,566	)
Sales and marketing		(2,690,824	)		69,031		196,311		—			(2,425,482	)		(2,813,922	)		68,960		158,902		—			(2,586,060	)		(431,252	)		10,569		24,353		—			(396,330	)
General and administrative		(1,527,282	)		—		1,012,896		—			(514,386	)		(763,150	)		—		325,465		—			(437,685	)		(116,958	)		—		49,880		—			(67,078	)

Cost and operating expenses		(13,805,233	)		152,223		1,408,232		—			(12,244,778	)		(12,721,530	)		152,065		678,686		—			(11,890,779	)		(1,949,659	)		23,305		104,013		—			(1,822,341	)
Income from operations		3,554,699			152,223		1,408,232		—			5,115,154			2,531,435			152,065		678,686		—			3,362,186			387,961			23,305		104,013		—			515,279
Net income attributable to Momo Inc.		2,970,890			152,223		1,408,232		(38,056	)		4,493,289			2,103,484			152,065		678,686		(38,016	)		2,896,219			322,374			23,305		104,013		(5,826	)		443,866

(ii)	Includes tax impacts related to the amortization of intangible assets from business acquisition.

Momo Inc.

Unaudited Condensed Segment Report

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


	Three months
	ended December 31, 2020
	Momo			Tantan			QOOL			Total			Total
	RMB			RMB			RMB			RMB			US$
Net revenues:
Live video service		1,923,544			404,331			—			2,327,875			356,762
Value-added service		1,065,062			336,207			—			1,401,269			214,754
Mobile marketing		52,663			—			—			52,663			8,071
Mobile games		7,334			—			—			7,334			1,124
Other services		2,743			—			3,317			6,060			929

Total net revenues		3,051,346			740,538			3,317			3,795,201			581,640
Cost and expenses (iii):
Cost of revenues		(1,676,071	)		(365,350	)		(1,360	)		(2,042,781	)		(313,070	)
Research and development		(243,555	)		(83,740	)		—			(327,295	)		(50,160	)
Sales and marketing		(361,115	)		(336,558	)		(49	)		(697,722	)		(106,931	)
General and administrative		(202,831	)		(11,891	)		(7,469	)		(222,191	)		(34,052	)

Total cost and expenses		(2,483,572	)		(797,539	)		(8,878	)		(3,289,989	)		(504,213	)
Other operating income		83,110			3,945			1,330			88,385			13,546

Income (loss) from operations		650,884			(53,056	)		(4,231	)		593,597			90,973
Interest income		100,347			486			47			100,880			15,461
Interest expense		(19,047	)		—			—			(19,047	)		(2,919	)
Other gain or loss, net		7,500			—			—			7,500			1,149

Income (loss) before income tax and share of income on equity method investments		739,684			(52,570	)		(4,184	)		682,930			104,664
Income tax (expenses) benefits		(7,565	)		2,084			—			(5,481	)		(840	)

Income (loss) before share of income on equity method investments		732,119			(50,486	)		(4,184	)		677,449			103,824
Share of loss on equity method investments		(26,319	)		—			—			(26,319	)		(4,034	)

Net income (loss)		705,800			(50,486	)		(4,184	)		651,130			99,790

(iii)

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


	Three months
	ended December 31, 2020
	Momo		Tantan		QOOL		Total		Total
	RMB		RMB		RMB		RMB		US$
Cost of revenues		2,844		1,398		—		4,242		650
Research and development		31,946		6,569		—		38,515		5,903
Sales and marketing		21,452		5,670		—		27,122		4,157
General and administrative		84,706		644		2,355		87,705		13,441

Total cost and expenses		140,948		14,281		2,355		157,584		24,151

Momo 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, 2020
	Momo RMB		Tantan RMB			QOOL RMB			Total RMB			Total US$
Income (loss) from operations		650,884		(53,056	)		(4,231	)		593,597			90,973
Share-based compensation		140,948		14,281			2,355			157,584			24,151
Amortization of intangible assets from business acquisitions		—		36,488			—			36,488			5,592

Non-GAAP income (loss) from operations		791,832		(2,287	)		(1,876	)		787,669			120,716
Net income (loss)		705,800		(50,486	)		(4,184	)		651,130			99,790
Share-based compensation		140,948		14,281			2,355			157,584			24,151
Amortization of intangible assets from business acquisitions		—		36,488			—			36,488			5,592
Tax impacts		—		(9,122	)		—			(9,122	)		(1,398	)

Non-GAAP net income (loss)		846,748		(8,839	)		(1,829	)		836,080			128,135

Momo Inc.

Unaudited Condensed Segment Report

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


	Three months ended December 31, 2019
	Momo RMB			Tantan RMB			QOOL RMB			Total RMB			Total US$¹
Net revenues:
Live video service		3,383,477			—			—			3,383,477			486,006
Value-added service		819,325			369,789			—			1,189,114			170,806
Mobile marketing		92,991			—			—			92,991			13,357
Mobile games		14,418			—			—			14,418			2,071
Other services		7,111			—			787			7,898			1,134

Total net revenues		4,317,322			369,789			787			4,687,898			673,374
Cost and expenses (iv):
Cost of revenues		(2,222,912	)		(127,748	)		(649	)		(2,351,309	)		(337,744	)
Research and development		(205,793	)		(86,395	)		—			(292,188	)		(41,970	)
Sales and marketing		(379,940	)		(345,089	)		—			(725,029	)		(104,144	)
General and administrative		(192,789	)		(13,275	)		(6,539	)		(212,603	)		(30,539	)

Total cost and expenses		(3,001,434	)		(572,507	)		(7,188	)		(3,581,129	)		(514,397	)
Other operating income		142,613			—			33			142,646			20,490

Income (loss) from operations		1,458,501			(202,718	)		(6,368	)		1,249,415			179,467
Interest income		105,947			2,197			61			108,205			15,543
Interest expense		(20,190	)		—			—			(20,190	)		(2,900	)

Income (loss) before income tax and share of income on equity method investments		1,544,258			(200,521	)		(6,307	)		1,337,430			192,110
Income tax (expenses) benefits		(265,981	)		12,277			—			(253,704	)		(36,442	)

Income (loss) before share of income on equity method investments		1,278,277			(188,244	)		(6,307	)		1,083,726			155,668
Share of loss on equity method investments		(31,406	)		—			—			(31,406	)		(4,511	)

Net income (loss)		1,246,871			(188,244	)		(6,307	)		1,052,320			151,157

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


	Three months ended December 31, 2019
	Momo RMB		Tantan RMB		QOOL RMB		Total RMB		Total US$
Cost of revenues		6,000		1,601		—		7,601		1,092
Research and development		26,980		18,475		—		45,455		6,529
Sales and marketing		45,971		7,495		—		53,466		7,680
General and administrative		56,467		1,384		3,085		60,936		8,753

Total cost and expenses		135,418		28,955		3,085		167,458		24,054

¹	All translations from RMB to U.S. dollars are made at a rate of RMB 6.9618 to US$1.00, the effective noon buying rate for December 31, 2019 as set forth in the H.10 statistical release of the Federal Reserve Board.

Momo 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, 2019
	Momo RMB		Tantan RMB			QOOL RMB			Total RMB			Total US$
Income (loss) from operations		1,458,501		(202,718	)		(6,368	)		1,249,415			179,467
Share-based compensation		135,418		28,955			3,085			167,458			24,054
Amortization of intangible assets from business acquisitions		—		38,806			—			38,806			5,574

Non-GAAP income (loss) from operations		1,593,919		(134,957	)		(3,283	)		1,455,679			209,095
Net income (loss)		1,246,871		(188,244	)		(6,307	)		1,052,320			151,157
Share-based compensation		135,418		28,955			3,085			167,458			24,054
Amortization of intangible assets from business acquisitions		—		38,806			—			38,806			5,574
Tax impacts		—		(9,701	)		—			(9,701	)		(1,394	)

Non-GAAP net income (loss)		1,382,289		(130,184	)		(3,222	)		1,248,883			179,391

Momo Inc.

Unaudited Condensed Segment Report

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


	Year
	ended December 31, 2020
	Momo			Tantan			QOOL			Total			Total
	RMB			RMB			RMB			RMB			US$
Net revenues:
Live video service		8,638,810			998,769			—			9,637,579			1,477,024
Value-added service		3,742,637			1,369,545			—			5,112,182			783,476
Mobile marketing		198,197			—			—			198,197			30,375
Mobile games		39,564			—			—			39,564			6,063
Other services		11,911			—			24,755			36,666			5,620

Total net revenues		12,631,119			2,368,314			24,755			15,024,188			2,302,558
Cost and expenses (v):
Cost of revenues		(6,865,836	)		(1,088,816	)		(22,129	)		(7,976,781	)		(1,222,495	)
Research and development		(844,826	)		(322,851	)					(1,167,677	)		(178,954	)
Sales and marketing		(1,454,123	)		(1,359,709	)		(90	)		(2,813,922	)		(431,252	)
General and administrative		(664,458	)		(73,019	)		(25,673	)		(763,150	)		(116,958	)

Total cost and expenses		(9,829,243	)		(2,844,395	)		(47,892	)		(12,721,530	)		(1,949,659	)
Other operating income		223,312			3,945			1,520			228,777			35,062

Income (loss) from operations		3,025,188			(472,136	)		(21,617	)		2,531,435			387,961
Interest income		440,878			3,353			240			444,471			68,118
Interest expense		(78,872	)		—			—			(78,872	)		(12,088	)
Other gain or loss, net		1,500			—			—			1,500			230

Income (loss) before income tax and share of income on equity method investments		3,388,694			(468,783	)		(21,377	)		2,898,534			444,221
Income tax (expenses) benefits		(770,333	)		14,713			—			(755,620	)		(115,804	)

Income (loss) before share of income on equity method investments		2,618,361			(454,070	)		(21,377	)		2,142,914			328,417
Share of loss on equity method investments		(42,522	)		—			—			(42,522	)		(6,517	)

Net income (loss)		2,575,839			(454,070	)		(21,377	)		2,100,392			321,900

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


	Year
	ended December 31, 2020
	Momo		Tantan		QOOL		Total		Total
	RMB		RMB		RMB		RMB		US$
Cost of revenues		15,189		3,260		—		18,449		2,827
Research and development		127,714		48,156		—		175,870		26,953
Sales and marketing		142,908		15,994		—		158,902		24,353
General and administrative		292,356		22,882		10,227		325,465		49,880

Total cost and expenses		578,167		90,292		10,227		678,686		104,013

Momo 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, 2020
	Momo		Tantan			QOOL			Total			Total
	RMB		RMB			RMB			RMB			US$
Income (loss) from operations		3,025,188		(472,136	)		(21,617	)		2,531,435			387,961
Share-based compensation		578,167		90,292			10,227			678,686			104,013
Amortization of intangible assets from business acquisitions		—		152,065			—			152,065			23,305

Non-GAAP income (loss) from operations		3,603,355		(229,779	)		(11,390	)		3,362,186			515,279
Net income (loss)		2,575,839		(454,070	)		(21,377	)		2,100,392			321,900
Share-based compensation		578,167		90,292			10,227			678,686			104,013
Amortization of intangible assets from business acquisitions		—		152,065			—			152,065			23,305
Tax impacts		—		(38,016	)		—			(38,016	)		(5,826	)

Non-GAAP net income (loss)		3,154,006		(249,729	)		(11,150	)		2,893,127			443,392

Momo Inc.

Unaudited Condensed Segment Report

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


	Year
	ended December 31, 2019
	Momo			Tantan			QOOL			Total			Total
	RMB			RMB			RMB			RMB			US$
Net revenues:
Live video service		12,448,131			—			—			12,448,131			1,788,062
Value-added service		2,846,057			1,259,906			—			4,105,963			589,785
Mobile marketing		331,822			—			—			331,822			47,663
Mobile games		92,451			—			—			92,451			13,280
Other services		22,354			—			14,368			36,722			5,275

Total net revenues		15,740,815			1,259,906			14,368			17,015,089			2,444,065
Cost and expenses (vi):
Cost of revenues		(8,065,300	)		(415,688	)		(11,108	)		(8,492,096	)		(1,219,813	)
Research and development		(797,471	)		(297,560	)		—			(1,095,031	)		(157,291	)
Sales and marketing		(1,521,511	)		(1,162,912	)		(6,401	)		(2,690,824	)		(386,513	)
General and administrative		(641,269	)		(851,099	)		(34,914	)		(1,527,282	)		(219,380	)

Total cost and expenses		(11,025,551	)		(2,727,259	)		(52,423	)		(13,805,233	)		(1,982,997	)
Other operating income		323,444			—			21,399			344,843			49,534

Income (loss) from operations		5,038,708			(1,467,353	)		(16,656	)		3,554,699			510,602
Interest income		396,672			10,706			164			407,542			58,540
Interest expense		(78,611	)		—			—			(78,611	)		(11,292	)
Other gain or loss, net		(15,711	)		—			—			(15,711	)		(2,257	)

Income (loss) before income tax and share of income on equity method investments		5,341,058			(1,456,647	)		(16,492	)		3,867,919			555,593
Income tax (expenses) benefits		(917,265	)		33,464			—			(883,801	)		(126,950	)

Income (loss) before share of income on equity method investments		4,423,793			(1,423,183	)		(16,492	)		2,984,118			428,643
Share of income on equity method investments		(23,350	)		—			—			(23,350	)		(3,354	)

Net income (loss)		4,400,443			(1,423,183	)		(16,492	)		2,960,768			425,289

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


	Year
	ended December 31, 2019
	Momo		Tantan		QOOL		Total		Total
	RMB		RMB		RMB		RMB		US$
Cost of revenues		20,393		3,579		—		23,972		3,443
Research and development		103,655		71,398		—		175,053		25,145
Sales and marketing		175,657		20,654		—		196,311		28,198
General and administrative		207,053		795,033		10,810		1,012,896		145,493

Total cost and expenses		506,758		890,664		10,810		1,408,232		202,279

Momo 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, 2019
	Momo		Tantan			QOOL			Total			Total
	RMB		RMB			RMB			RMB			US$
Income (loss) from operations		5,038,708		(1,467,353	)		(16,656	)		3,554,699			510,602
Share-based compensation		506,758		890,664			10,810			1,408,232			202,279
Amortization of intangible assets from business acquisitions		—		152,223			—			152,223			21,866

Non-GAAP income (loss) from operations		5,545,466		(424,466	)		(5,846	)		5,115,154			734,747
Net income (loss)		4,400,443		(1,423,183	)		(16,492	)		2,960,768			425,289
Share-based compensation		506,758		890,664			10,810			1,408,232			202,279
Amortization of intangible assets from business acquisitions		—		152,223			—			152,223			21,866
Tax impacts		—		(38,056	)		—			(38,056	)		(5,466	)

Non-GAAP net income (loss)		4,907,201		(418,352	)		(5,682	)		4,483,167			643,968