Hello Group and Industry Analysis Summary Company Overview - **Company**: Hello Group - **Industry**: Social Networking and Mobile Applications Key Financial Performance - **Total Revenue**: 2024 total revenue was 10.6 billion RMB, a decrease of 11.7% from 2023's 12 billion RMB [3][5] - **Adjusted Operating Income**: 1.73 billion RMB with a profit margin of 16.3% [3][5] - **Fourth Quarter Revenue**: 2.64 billion RMB, down 12% year-over-year [3][11] - **Cost Structure**: Fourth quarter included 940 million RMB in fuel production costs; adjusted operating income would be 3.174 billion RMB without these costs [3] Revenue Breakdown - **Mobile Applications and New Apps**: Combined revenue of 9.7 billion RMB, down 11% year-over-year; however, independent new app revenue grew by 40% due to overseas expansion [3][5] - **Tantan Performance**: 2024 total revenue was 900 million RMB, a 25% decline; Vast business line revenue down 18%, and live streaming revenue down 38% [3][6] Strategic Initiatives - **Cost Optimization**: Hello Group is reducing marketing expenses and exploring partnerships with short video platforms to acquire users [3][8] - **Product Innovation**: Focus on enhancing user experience through product upgrades, particularly in live streaming and interactive features [3][9] - **User Acquisition**: Tantan is implementing offline events and integrated marketing strategies to optimize user acquisition costs [3][10] Future Outlook - **First Quarter 2025 Revenue Forecast**: Expected between 2.4 billion to 2.5 billion RMB, a decline of 6.3% to 2.4% year-over-year [3][14] - **International Growth**: Anticipated overseas revenue of approximately 1 billion RMB in 2024, growing to 1.7 billion to 2 billion RMB in 2025 [3][22] - **Cash Dividend**: Board approved a special cash dividend of $0.3 per American Depositary Share, totaling approximately $15 million, representing 30% of adjusted net income for 2024 [3][13] Research and Development - **R&D Spending**: 101 million RMB in 2024, significantly reduced from 423 million RMB in 2023, indicating a shift in investment strategy [3][9] Market Challenges - **User Engagement**: Despite a 1.2 million increase in paid users in Q1 2025, the company anticipates a decline in overall paid users due to economic conditions [3][15] - **Live Streaming and Content Adjustments**: Management believes significant improvements have been made in mobile content, with no further revenue-reducing changes planned [3][16] Conclusion - Hello Group is navigating a challenging economic landscape with a focus on cost optimization, product innovation, and international expansion. The company is strategically reducing R&D expenses while maintaining a flexible approach to capital returns, balancing between dividends and stock buybacks to maximize shareholder value.

Financial Data and Key Metrics Changes - For Q4 2024, total group revenue was RMB2.64 billion, down 12% year-over-year. Adjusted operating income was RMB280 million, with a margin of 10.6% [9][51]. - For fiscal 2024, total group revenue was RMB10.6 billion, compared to RMB12 billion in the previous year. Adjusted operating income was RMB1.173 billion with a margin of 16.3% [12][13]. Business Line Data and Key Metrics Changes - Revenue from the Momo app and standalone new apps totaled RMB2.42 billion, down 11% year-over-year, with Momo app revenue decreasing by 18% [10][13]. - Tantan's Q4 revenue totaled RMB213 million, down 22% year-over-year due to a decrease in paying users [12][34]. - Revenue from value-added services (VAS), excluding Tantan, totaled RMB1.2 billion in Q4, down 5% year-over-year [26][55]. Market Data and Key Metrics Changes - The overseas business maintained robust growth, contributing significantly to the group's financial standing [8]. - The Momo app had 5.7 million paying users, a sequential decrease of 1.2 million due to cost reduction strategies [22]. Company Strategy and Development Direction - The company aims to maintain the productivity of the Momo app while focusing on improving user experience and optimizing operational efficiency [15][48]. - For Tantan, the strategic goal is to reduce costs and improve efficiency while exploring dating experiences suitable for agents [48][110]. - The company plans to increase investments in overseas markets, particularly in the MENA region, to drive growth and innovation [41][104]. Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by the macroeconomic environment and regulatory changes but expressed confidence in the resilience of the Momo platform [80][83]. - The company expects a revenue decline in Q1 2025 but anticipates a slight rebound in Q2, depending on macroeconomic conditions [68][86]. Other Important Information - The Board approved a special cash dividend of $0.30 per ADS, totaling approximately $50 million, marking the seventh consecutive year of cash dividends [49]. - The company is focusing on optimizing headcount and improving marketing efficiency to absorb top-line pressure while reallocating resources to overseas business [88]. Q&A Session All Questions and Answers Question: What caused the significant drop in paying users for the Momo app? - Management indicated that the drop was due to a strategic shift away from acquiring low-return paying users, which has historically pressured profitability [74][76]. Question: What adjustments have been made to live streaming and VAS products? - Management stated that after improving Momo's content, no further changes to reduce earnings are planned, focusing instead on adding engaging features [77]. Question: What is the outlook for Tantan's revenue and profit in 2025? - Management expects a revenue decline of 20% to 30% year-over-year for Tantan in 2025, but profitability is anticipated to improve due to better ROI from reduced marketing spend [120].

Financial Performance - Net revenues for Q4 2024 decreased by 12.2% year over year to RMB2,636.5 million (US$361.2 million) from RMB3,002.9 million in Q4 2023[5] - Net income attributable to Hello Group Inc. in Q4 2024 was RMB187.2 million (US$25.6 million), down from RMB452.5 million in the same period of 2023[5] - Full year 2024 net revenues were RMB10,563.0 million (US$1,447.1 million), a decrease of 12.0% from RMB12,002.3 million in 2023[24] - Non-GAAP net income for the full year 2024 was RMB1,232.9 million (US$168.9 million), compared to RMB2,224.7 million in the same period of 2023[25] - The net income for Q4 2024 was RMB187,235, down from RMB452,469 in Q4 2023, reflecting a decrease of about 58.6%[48] - Net income for the year ended December 31, 2024, was RMB 1,039,573, a decrease of 46.7% compared to RMB 1,951,695 in 2023[53] User Metrics - Monthly Active Users (MAU) on the Tantan app decreased to 10.8 million in December 2024, compared to 13.7 million in December 2023[5] - Total paying users for the Momo app in Q4 2024 was 5.7 million, down from 7.4 million in the same period last year[5] Expenses and Costs - Research and development expenses for Q4 2024 were RMB222,684, slightly down from RMB231,445 in Q4 2023, indicating a decrease of about 3.3%[46] - The total cost and expenses for Q4 2024 were RMB2,407,825, a slight decrease from RMB2,431,756 in Q4 2023[46] - The cost of revenues for the three months ended December 31, 2024, was RMB 1,724,821, reflecting an increase from RMB 1,621,151 in the previous year[61] - The company incurred total costs and expenses of RMB 9,089,204 (US$ 1,245,216) for the year ended December 31, 2024, with significant allocations to research and development at RMB 804,425 (US$ 110,206)[69] Cash and Assets - As of December 31, 2024, the company's cash and cash equivalents totaled RMB14,728.5 million (US$2,017.8 million), an increase from RMB13,478.5 million a year earlier[23] - Total current assets increased from RMB 7,833,378 in 2023 to RMB 12,011,870 in 2024, representing a growth of 53.9%[50] - Cash and cash equivalents at the end of the period rose to RMB 9,642,421, up from RMB 8,282,912, indicating an increase of 16.4%[53] - The company reported a cash inflow from the maturity of short-term deposits of RMB 1,047,165 in 2024, compared to RMB 800,000 in 2023, an increase of 30.9%[53] Shareholder Actions - The company declared a special cash dividend of US$0.30 per ADS, totaling approximately US$50 million, to be paid on April 30, 2025[27] - The share repurchase program was upsized to US$486.1 million, with US$222 million remaining as of March 12, 2025[29] Future Outlook - For Q1 2025, the Company expects total net revenues to be between RMB2.4 billion to RMB2.5 billion, representing a year-over-year decrease of 6.3% to 2.4%[31] - The company plans to continue expanding its market presence, particularly in live video and value-added services, which are key growth areas[69] Operational Metrics - Non-GAAP diluted net income per ADS for Q4 2024 was RMB1.30 (US$0.18), down from RMB2.63 in the same period of 2023[22] - The Company reported a comprehensive income of RMB510,170 for Q4 2024, compared to RMB356,695 in Q4 2023, showing an increase of approximately 43%[48] - The Company’s diluted net income per share for Q4 2024 was RMB0.53, compared to RMB1.16 in Q4 2023, representing a decline of approximately 54.4%[46] - The company reported an income from operations of RMB 236,686 for the three months ended December 31, 2024, compared to RMB 226,424 in the prior year[63] Investment and Growth - The Company has incubated several new apps since 2019, targeting niche markets and selective demographics, including Hertz, Soulchill, and Duidui[40] - The company demonstrated a strong performance in non-GAAP metrics, indicating operational efficiency[75] - Future strategies may focus on enhancing user engagement and expanding market presence[75]

Company Performance - Hello Group Inc. (MOMO) reported quarterly earnings of $0.18 per share, missing the Zacks Consensus Estimate of $0.21 per share, and down from $0.37 per share a year ago, representing an earnings surprise of -14.29% [1] - The company posted revenues of $361.2 million for the quarter ended December 2024, missing the Zacks Consensus Estimate by 1.06%, and down from $422.95 million year-over-year [2] - Over the last four quarters, the company has surpassed consensus EPS estimates two times and topped consensus revenue estimates two times [2] Market Outlook - Momo shares have lost about 3.8% since the beginning of the year, compared to the S&P 500's decline of -5.3% [3] - The company's earnings outlook, including current consensus earnings expectations for the coming quarters, will be crucial for investors [4] - The current consensus EPS estimate for the coming quarter is $0.24 on revenues of $319.48 million, and for the current fiscal year, it is $0.82 on revenues of $1.38 billion [7] Industry Context - The Internet - Software industry, to which Momo belongs, is currently in the top 33% of over 250 Zacks industries, indicating a favorable outlook [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Momo's stock performance [5] - The current estimate revisions trend for Momo is mixed, resulting in a Zacks Rank 3 (Hold), suggesting the shares are expected to perform in line with the market in the near future [6]

Financial Data and Key Metrics Changes - For Q4 2024, total group revenue was RMB 2.64 billion, down 12% year over year [9] - Adjusted operating income was RMB 280 million with a margin of 10.6% [9] - For fiscal 2024, total revenue was RMB 10.6 billion compared to RMB 12 billion in the previous year [11] Business Line Data and Key Metrics Changes - Revenue from the Momo app and standalone new apps totaled RMB 9.7 billion, down 11% year over year [12] - Tantan's Q4 revenue was RMB 213 million, down 22% year over year due to a decrease in paying users [11] - Revenue from value-added services excluding Tantan totaled RMB 4.18 billion, down 6% year over year [20] Market Data and Key Metrics Changes - The overseas business maintained robust growth, contributing significantly to the group's financials [6] - Revenue from standalone new apps grew 40% year over year, driven by overseas expansion [12] - Tantan's MAU declined by 10% sequentially to 10.8 million in September [23] Company Strategy and Development Direction - The company aims to maintain the productivity of the Momo app while focusing on improving user experience and optimizing operational efficiency [13][14] - For Tantan, the strategy is to enhance the dating experience and build a sustainable business model while reducing user acquisition costs [78][80] - The company plans to increase investments in overseas markets and new product initiatives to drive growth [28][30] Management Comments on Operating Environment and Future Outlook - Management acknowledged challenges from the macroeconomic environment and regulatory changes but expressed confidence in the resilience of the Momo platform [56][58] - The outlook for Q1 2025 anticipates a revenue decline of 6.3% to 2.4% year over year, with expectations of a slight rebound in Q2 [45][61] - Management expects Tantan's revenue to decline by 20% in 2025 due to reduced marketing spend and operational adjustments [86] Other Important Information - The Board approved a special cash dividend of USD 0.3 per ADS, totaling approximately USD 15 million [32] - The company emphasized a flexible approach to capital allocation, preferring to invest in growth opportunities rather than committing to a fixed dividend policy [92] Q&A Session Summary Question: What caused the significant drop in paying users for Momo? - Management indicated that the drop was due to a strategic shift away from acquiring low-return paying users, which was necessary to improve profitability [52][53] Question: What are the adjustments to live streaming and value-added services? - Management stated that no major changes would be made to reduce earnings, focusing instead on enhancing user engagement and adding fun features [54] Question: What is the outlook for Tantan's revenue and profit in 2025? - Management expects a revenue decline of 20% to 30% for Tantan in 2025 due to reduced marketing spend and operational adjustments [86] Question: How does the company view its overseas business growth? - The overseas business is expected to grow significantly, with revenue projected to increase from around RMB 1 billion in 2024 to between RMB 1.7 billion to RMB 2 billion in 2025 [73] Question: What is the company's approach to capital returns? - Management prefers flexibility in capital allocation, indicating that a rigid dividend policy is not being considered, as they aim to optimize returns through various means [92]

Core Viewpoint - Hello Group Inc. reported its unaudited financial results for Q4 and the full year of 2024, highlighting challenges and opportunities faced during the year, with a focus on the performance of its Momo and Tantan segments and plans for future growth and innovation in international markets [3][4]. Q4 2024 Highlights - Total net revenues for Q4 2024 were RMB2,636.5 million (US$361.2 million), a decrease of 12.2% from RMB3,002.9 million in Q4 2023 [4][15]. - Live video service revenues decreased by 17.0% to RMB1,264.9 million (US$173.3 million) due to operational adjustments and soft consumer sentiment [5]. - Value-added service revenues fell by 6.9% to RMB1,326.8 million (US$181.8 million), impacted by product adjustments and a decline in Tantan's paying users [6]. - Net income attributable to Hello Group Inc. was RMB187.2 million (US$25.6 million), down from RMB452.5 million in Q4 2023 [15][19]. - Monthly Active Users (MAU) on Tantan app decreased to 10.8 million in December 2024 from 13.7 million in December 2023 [15]. Full Year 2024 Highlights - Full year net revenues were RMB10,563.0 million (US$1,447.1 million), a decrease of 12.0% from RMB12,002.3 million in 2023 [22][23]. - Net income attributable to Hello Group Inc. for the full year was RMB1,039.6 million (US$142.4 million), compared to RMB1,957.6 million in 2023 [22]. - Non-GAAP net income for the full year was RMB1,232.9 million (US$168.9 million), down from RMB2,224.7 million in 2023 [23]. Cash and Cash Flow - As of December 31, 2024, the Company had cash and cash equivalents totaling RMB14,728.5 million (US$2,017.8 million), an increase from RMB13,478.5 million as of December 31, 2023 [21]. - Net cash provided by operating activities in Q4 2024 was RMB423.6 million (US$58.0 million), compared to RMB415.9 million in Q4 2023 [21]. Recent Developments - The board of directors declared a special cash dividend of US$0.30 per ADS, totaling approximately US$50 million, to be paid on April 30, 2025 [25]. - The Share Repurchase Program was amended to increase the total authorization to US$486.1 million, with a remaining size of US$222 million as of March 12, 2025 [26][27]. Business Outlook - For Q1 2025, the Company expects total net revenues to be between RMB2.4 billion to RMB2.5 billion, representing a decrease of 6.3% to 2.4% year over year [28].

Core Viewpoint - Hello Group Inc. is set to release its unaudited financial results for Q4 and the fiscal year ending December 31, 2024, on March 12, 2025, before U.S. markets open [1] Group 1: Financial Results Announcement - The unaudited financial results will be announced before U.S. markets open on March 12, 2025 [1] - An earnings conference call will be held on the same day at 8:00 a.m. U.S. Eastern Time [2] - Participants can preregister for the conference call through a provided link and will receive details including dial-in numbers and a unique access PIN [3] Group 2: Conference Call Details - A telephone replay of the conference call will be available until March 19, 2025, with specific dial-in details provided [4] - A live and archived webcast of the conference call will be accessible on the Investor Relations section of Hello Group's website [4] Group 3: Company Overview - Hello Group Inc. is a leading player in mainland China's online social networking space, operating applications like Momo and Tantan [5] - Momo facilitates social interactions based on location and interests, while Tantan focuses on romantic connections [5] - The company has also incubated several new apps targeting niche markets since 2019 [5]

Group 1 - Hello Group Inc. (NASDAQ: MOMO) operates social media apps in China, benefiting from a massive potential client base [1] - The company has been in the industry since 2011, accumulating significant expertise [1] - MOMO is well-positioned in the market, similar to how a kingfisher searches for small fish, indicating a strategic approach to identifying opportunities [1] Group 2 - The analyst has a beneficial long position in MOMO shares, indicating confidence in the company's future performance [2] - The article expresses the author's personal opinions and does not involve compensation from any company mentioned [2]

Investment Rating - The report maintains a **Neutral** rating for Momo Inc (MOMO US) with a target price of $7.40, representing a potential upside of 0.1% from the current price of $7.39 [1][4] Core Views - Momo's core business and Tantan are expected to remain under pressure due to ongoing business adjustments and weak social consumption trends [1] - Overseas business is growing rapidly, partially offsetting the decline in core business, with total revenue expected to decrease by 5% YoY in 2025 [1] - The company's market capitalization of $1.3 billion is below its net cash position of $1.4 billion as of Q3 2024, and its shareholder returns are leading among internet companies, with quarterly buybacks of $30-60 million and a dividend yield exceeding 7% [1] Financial Performance Q3 2024 Results - Revenue declined 12% YoY to RMB 2.68 billion, slightly better than expected, with adjusted net profit of RMB 490 million, down 19% YoY but above expectations [2] - Adjusted net margin was 18%, down 2 percentage points YoY, mainly due to increased operating expenses from higher overseas app revenue share and overall revenue decline [2] - Momo's live streaming and value-added services revenue declined 14% and 18% YoY respectively, while new app revenue grew 41% YoY, driven by overseas social product growth [2] - Tantan's revenue fell 28% YoY, with MAU and quarterly paying members declining by 900k and 100k respectively [2] Financial Forecasts - Revenue is expected to decline 12% YoY in Q4 2024, with the decline narrowing in 2025 as ecosystem adjustments conclude [2] - 2025 net profit forecast is revised down by 11% due to changes in revenue structure and ongoing new business investments [2] - For 2024E, revenue is forecast at RMB 10.526 billion, with adjusted net profit of RMB 1.3 billion, representing a net margin of 12.3% [3] - 2025E revenue is projected at RMB 10.015 billion, with adjusted net profit of RMB 1.308 billion and a net margin of 13.1% [3] Business Segments - Momo's revenue is expected to decline 3% YoY in Q4 2024, while Tantan's revenue is forecast to drop 26% YoY [16] - New independent social apps accounted for 16% of total revenue in Q3 2024, up from 2% in Q1 2021 [12] - Momo's live streaming revenue declined 45% YoY in Q3 2024, while value-added services revenue fell 19% YoY [14] Valuation and Shareholder Returns - The target price is based on 7x 2025E P/E ratio, raised from $5.90 to $7.40 [1] - The company's shareholder return policy is leading among internet peers, with quarterly buybacks of $30-60 million and a dividend yield exceeding 7% [1]

Exhibit 99.1 Hello Group Inc. Announces Unaudited Financial Results for the Third Quarter of 2024 BEIJING, CHINA, December 9, 2024 – Hello Group Inc. (NASDAQ: MOMO) ("Hello Group" or the "Company"), a leading player in mainland China's online social networking space, today announced its unaudited financial results for the third quarter of 2024. Third Quarter of 2024 Highlights • Net revenues decreased by 12.1% year over year to RMB2,674.7 million (US$381.1 million*) in the third quarter of 2024. • Net incom ...