JOYY(YY) - 2024 Q4 - Annual Report

Financial and Operational Highlights This section provides an overview of JOYY's key financial and operational performance for Q4 and full year 2024 Fourth Quarter 2024 Financial Highlights JOYY reported a significant GAAP net loss in Q4 2024 due to goodwill impairment, despite strong non-GAAP net income growth Q4 2024 Key Financial Metrics (vs. Q4 2023) | Metric | Q4 2024 | Q4 2023 | Change | | :--- | :--- | :--- | :--- | | Net Revenues | US$549.4 M | US$569.8 M | -3.6% | | Net (Loss)/Income (GAAP) | (US$304.1 M) | US$45.8 M | -763.9% | | Non-GAAP Net Income | US$96.1 M | US$64.2 M | +49.7% | - The significant GAAP net loss was primarily due to a one-time, non-cash goodwill impairment charge of US$454.9 million[3] Full Year 2024 Highlights For the full year 2024, net revenues remained flat, with a GAAP net loss driven by impairment, while non-GAAP net income slightly increased Full Year 2024 Key Financial Metrics (vs. FY 2023) | Metric | FY 2024 | FY 2023 | Change | | :--- | :--- | :--- | :--- | | Net Revenues | US$2,237.8 M | US$2,267.9 M | -1.3% | | Net (Loss)/Income (GAAP) | (US$146.2 M) | US$301.8 M | -148.4% | | Non-GAAP Net Income | US$298.5 M | US$292.5 M | +2.1% | Fourth Quarter 2024 Operational Highlights The company experienced a decline in user metrics in Q4 2024 due to strategic marketing optimization, impacting paying users and ARPPU - The decline in global MAUs was a result of the company's strategic optimization of sales and marketing to focus on return-on-investment and disciplined spending[6] Q4 2024 Average Mobile MAUs (vs. Q4 2023) | Platform | Q4 2024 MAUs | Q4 2023 MAUs | Change | | :--- | :--- | :--- | :--- | | Global | 263.1 M | 274.9 M | -4.3% | | Bigo Live | 33.4 M | 38.4 M | -13.0% | | Likee | 30.6 M | 39.1 M | -21.7% | | Hago | 3.6 M | 4.6 M | -21.7% | Q4 2024 BIGO Paying User Metrics (vs. Q4 2023) | Metric | Q4 2024 | Q4 2023 | Change | | :--- | :--- | :--- | :--- | | Paying Users | 1.54 M | 1.67 M | -7.8% | | ARPPU | US$237.1 | US$244.8 | -3.1% | Management Commentary The CEO highlighted significant progress in operational efficiency and revenue diversification, positioning the company as a global AI-driven technology firm - Non-livestreaming revenues grew by 55.9% to US$449.8 million in 2024, highlighting successful revenue diversification[10] - The company is committed to shareholder returns, having repurchased US$309.2 million in ADSs during 2024[10] - Future strategy involves driving diversified growth in global operations and enhancing user experiences through AI-driven innovation, following the divestiture of YY Live[10] Detailed Financial Results This section provides an in-depth analysis of JOYY's financial performance for the fourth quarter and full year 2024 Fourth Quarter 2024 Financial Results Q4 2024 saw a GAAP operating and net loss due to a goodwill impairment, despite improved gross margin and strong non-GAAP performance Revenues Q4 2024 net revenues decreased due to lower live streaming revenue, partially offset by a significant increase in other revenues from advertising Q4 2024 Revenue Breakdown (vs. Q4 2023) | Revenue Stream | Q4 2024 | Q4 2023 | Change | | :--- | :--- | :--- | :--- | | Live streaming | US$422.4 M | US$486.2 M | -13.1% | | Others | US$127.0 M | US$83.6 M | +51.9% | | Total Net Revenues | US$549.4 M | US$569.8 M | -3.6% | Cost, Gross Profit, and Operating Expenses Cost of revenues decreased, improving gross margin, but a significant goodwill impairment charge led to a GAAP operating loss despite controlled other expenses - Gross margin improved to 37.1% in Q4 2024 from 35.4% in Q4 2023, despite lower revenues[16] - Operating expenses were significantly impacted by a US$454.9 million goodwill impairment[17] Sales and marketing expenses decreased due to reduced advertising spend[17] Q4 2024 Operating Income (vs. Q4 2023) | Metric | Q4 2024 | Q4 2023 | | :--- | :--- | :--- | | Operating (Loss)/Income (GAAP) | (US$427.9 M) | US$4.8 M | | Non-GAAP Operating Income | US$46.4 M | US$27.9 M | Net Income and EPS The goodwill impairment resulted in a GAAP net loss, while non-GAAP net income and diluted EPS showed strong growth, reflecting underlying profitability Q4 2024 Net Income & Margin (vs. Q4 2023) | Metric | Q4 2024 | Q4 2023 | | :--- | :--- | :--- | | Net (Loss)/Income (GAAP) | (US$304.1 M) | US$45.8 M | | Non-GAAP Net Income | US$96.1 M | US$64.2 M | | Non-GAAP Net Income Margin | 17.5% | 11.3% | Q4 2024 Net Income per ADS (vs. Q4 2023) | Metric | Q4 2024 | Q4 2023 | | :--- | :--- | :--- | | Diluted Net (Loss)/Income per ADS (GAAP) | (US$5.67) | US$0.70 | | Non-GAAP Diluted Net Income per ADS | US$1.77 | US$0.97 | Full Year 2024 Financial Results Full year 2024 net revenues slightly decreased, with a GAAP net loss due to impairment, but non-GAAP operating and net income increased Full Year 2024 Financial Summary (vs. FY 2023) | Metric | FY 2024 | FY 2023 | | :--- | :--- | :--- | | Net Revenues | US$2,237.8 M | US$2,267.9 M | | Operating (Loss)/Income (GAAP) | (US$405.6 M) | US$28.8 M | | Non-GAAP Operating Income | US$136.1 M | US$130.5 M | | Net (Loss)/Income (GAAP) | (US$146.2 M) | US$301.8 M | | Non-GAAP Net Income | US$298.5 M | US$292.5 M | | Diluted Net (Loss)/Income per ADS (GAAP) | (US$2.55) | US$4.87 | | Non-GAAP Diluted Net Income per ADS | US$4.96 | US$4.10 | Financial Position and Corporate Actions This section details JOYY's balance sheet, cash flows, shareholder return initiatives, and recent corporate updates Balance Sheet and Cash Flows As of December 31, 2024, JOYY maintained a strong financial position with substantial net cash and positive operating cash flow - The company held net cash of US$3,300.4 million as of December 31, 2024[24] - Net cash from operating activities was US$110.5 million for the fourth quarter of 2024[24] Shareholder Return Initiatives JOYY demonstrated strong commitment to shareholder returns through significant share repurchases and the introduction of a new quarterly dividend policy - In 2024, the company repurchased 9.21 million ADSs for a total of US$309.2 million[33] - A new share repurchase program (2025 Program) was approved, authorizing up to US$300 million in buybacks until the end of 2027[34] - A new quarterly dividend program was authorized for 2025-2027, planning to distribute a total of approximately US$600 million[35] The first dividend is US$0.93 per ADS[36] Update on YY Live Sale and Ticker Symbol Change The sale of YY Live to Baidu was finalized, and JOYY will change its Nasdaq ticker symbol to reflect its global transformation - The sale of YY Live to Baidu was closed for an aggregate purchase price of approximately US$2.1 billion in cash[37] - The company will change its ticker symbol on Nasdaq from 'YY' to 'JOYY', with trading under the new symbol expected to begin on March 31, 2025[38] Business Outlook This section provides JOYY's financial guidance for the upcoming quarter, considering macroeconomic uncertainties First Quarter 2025 Guidance For Q1 2025, JOYY forecasts net revenues between US$482 million and US$490 million, subject to macroeconomic conditions - The company forecasts Q1 2025 net revenues to be in the range of US$482 million to US$490 million[31] Financial Statements and Reconciliations This section provides detailed financial statements and reconciliations of GAAP to non-GAAP results for comprehensive analysis Use of Non-GAAP Financial Measures This section explains the company's use of non-GAAP financial measures, excluding specific items for a clearer view of operating performance Unaudited Condensed Consolidated Balance Sheets This section presents a detailed breakdown of the company's assets, liabilities, and shareholders' equity as of December 31, 2024, and 2023 Unaudited Condensed Consolidated Statements of Operations This section presents the company's revenues, costs, expenses, and profits for Q4 and full year 2024, with comparative data Unaudited Reconciliation of GAAP and Non-GAAP Results This section contains tables that reconcile the reported GAAP financial figures to the non-GAAP figures by detailing specific adjustments Unaudited Segment Report This section details the financial performance of the company's primary operating segments, including GAAP to non-GAAP reconciliations