JOYY Inc. (JOYY) Q1 2025 Earnings Call Transcript

JOYY Inc. reported Q1 2025 revenue of $494 million, with non-livestreaming revenue up 25.3% year-over-year to $123 million, representing 25% of total revenue. Non-GAAP operating profit increased 25% year-over-year to $31 million, and the company generated $58 million in operating cash flow, while returning capital to shareholders through $49.1 million in dividends and $22.5 million in share repurchases. The company is focusing on expanding its programmatic advertising platform, BIGO Ads, and smart commerce SaaS platform to drive future growth, anticipating these non-livestreaming businesses will become a second growth engine.

Analysis

JOYY Inc. reported a robust first quarter for 2025, demonstrating significant progress in its strategic shift towards revenue diversification. Total revenue reached $494 million, with a notable 25.3% year-over-year increase in non-livestreaming revenue to $123 million, which now constitutes 25% of the group's total revenue, up from 17.4% in the prior year. This transition is underpinned by the rapid expansion of its non-livestreaming businesses, particularly within the BIGO segment where non-livestreaming revenues (primarily advertising) grew 27.3% year-over-year to $80.3 million and are already contributing positively to the bottom line. The company's financial health is further evidenced by a 24.9% year-over-year rise in non-GAAP operating profit to $31 million and strong operating cash flow of $58 million. JOYY also continued its commitment to shareholder returns, distributing $49.1 million in dividends during the first quarter and repurchasing $32.5 million worth of its shares during the year as of May 23, 2025. While the core livestreaming business, contributing $371 million, experienced temporary fluctuations due to strategic optimizations aimed at improving ROI and user quality, particularly in developed markets like North America where BIGO Live's MAU grew over 7% YoY, management anticipates stabilization and a return to QoQ growth from Q2 2025. Operational efficiency measures have led to a reduction in operating expenses and an improved non-GAAP operating profit margin for the BIGO segment to 13.3%. With a strong net cash position of $3.4 billion and positive Q2 revenue guidance of $499 million to $519 million, JOYY appears well-positioned to leverage its AI capabilities and global user base of 260 million to drive its non-livestreaming businesses as a new growth engine.

Key Decisions for Investors

• Investors should consider the accelerating growth in non-livestreaming revenues, particularly from BIGO Ads, as a primary driver for JOYY's future earnings potential and re-rating.
• Monitor the stabilization and expected resumption of quarter-over-quarter growth in the livestreaming segment from Q2 2025, as its performance remains crucial for the company's overall revenue trajectory and profitability.
• Factor in JOYY's consistent capital return program, including $49.1 million in Q1 dividends and ongoing share repurchases ($32.5 million YTD as of May 23rd), alongside its substantial $3.4 billion net cash position, when evaluating the stock's risk-reward profile.
• Closely track the execution of JOYY's strategy to scale its advertising and smart commerce SaaS platforms, which management has identified as the company's second growth engine, focusing on advancements in AI-driven user targeting and market penetration.