MOMO Q4 2025 Earnings Call Summary

1. Key Financial Results and Metrics

Q4 2025 Revenue: RMB 2.58 billion, down 2% year-over-year.
- Domestic Revenue: RMB 1.97 billion, down 14% year-over-year.
- Overseas Revenue: RMB 608 million, up 70% year-over-year, now 24% of total revenue (up from 14%).
Adjusted Operating Income: RMB 354 million, up 26% year-over-year, with a margin of 13.7%.
Full Year 2025 Revenue: RMB 10.37 billion, a slight decrease of less than 2% year-over-year.
- Domestic Revenue: RMB 8.37 billion, down 11% year-over-year.
- Overseas Revenue: RMB 2 billion, up 71% year-over-year.
Adjusted Operating Income for 2025: RMB 1.55 billion, down 10% year-over-year, with a margin of 15%.

2. Strategic Updates and Business Highlights

Domestic Business: Focused on maintaining productivity and enhancing the social ecosystem despite external headwinds. Implemented AI upgrades to improve user engagement and chat experiences.
Overseas Expansion: Significant growth driven by new product launches and acquisitions, particularly in the MENA region with apps like Yaha Live and Amar.
Tantan: Shifted focus to organic user growth and improved user experience, resulting in a slight increase in retention metrics.
New Initiatives: Continued investment in overseas operations and new product development, including the acquisition of Happn to enhance international dating offerings.

3. Forward Guidance and Outlook

Q1 2026 Revenue Guidance: Expected to be between RMB 2.3 billion to RMB 2.4 billion, indicating a year-over-year decline of 4.8% to 8.8%.
2026 Revenue Outlook: Anticipated domestic revenue decline in the low to mid-teens percentage-wise, while overseas revenue is projected to grow to approximately RMB 3 billion.
Operating Margin: Aim to maintain adjusted operating margins above 10%, likely in the low teens range.

4. Challenges and Points of Concern

Domestic Revenue Decline: Continued pressures from regulatory changes and macroeconomic conditions have negatively impacted domestic revenue, particularly affecting high-value users and overall spending sentiment.
User Metrics: Notable decline in paying users for Tantan, which fell from 700,000 to 600,000 quarter-over-quarter.
Profitability of Overseas Operations: While overseas revenue is growing, the business remains in an investment phase with ongoing losses expected. Profitability timelines are uncertain and dependent on market conditions.

5. Notable Q&A Insights

Domestic Business Trends: Management acknowledged challenges in the domestic market but expressed confidence in their adaptability and strategies to stabilize profits while focusing on lower-tier users.
Overseas Revenue Drivers: Emphasis on the importance of MENA products and the potential for growth in developed markets. Management noted that geopolitical tensions could impact operations but have not yet significantly affected business.
Gross Margin Stability: Q4 gross margin was stable, suggesting potential for similar performance in 2026, though management cautioned against over-extrapolating from one quarter due to ongoing uncertainties.

Overall, Hello Group (MOMO) is navigating a challenging domestic environment while successfully expanding its overseas operations. The company remains focused on maintaining profitability and adapting to market conditions.

MOMO — Hello Group Inc.